sign in sign up
<<
Home , Northstar Island, November 4

11–28–03 Friday Vol. 68 No. 229 Nov. 28, 2003

Pages 66693–67012

VerDate jul 14 2003 21:10 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4710 Sfmt 4710 E:\FR\FM\28NOWS.LOC 28NOWS

1 II Federal Register / Vol. 68, No. 229 / Friday, 28, 2003

The FEDERAL REGISTER (ISSN 0097–6326) is published daily, SUBSCRIPTIONS AND COPIES Monday through Friday, except official holidays, by the Office of the Federal Register, National Archives and Records PUBLIC Administration, Washington, DC 20408, under the Federal Register Subscriptions: Act (44 U.S.C. Ch. 15) and the regulations of the Administrative Paper or fiche 202–512–1800 Committee of the Federal Register (1 CFR Ch. I). The Assistance with public subscriptions 202–512–1806 Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402 is the exclusive distributor of the official General online information 202–512–1530; 1–888–293–6498 edition. Periodicals postage is paid at Washington, DC. Single copies/back copies: The FEDERAL REGISTER provides a uniform system for making Paper or fiche 202–512–1800 available to the public regulations and legal notices issued by Assistance with public single copies 1–866–512–1800 Federal agencies. These include Presidential proclamations and (Toll-Free) Executive Orders, Federal agency documents having general FEDERAL AGENCIES applicability and legal effect, documents required to be published by act of Congress, and other Federal agency documents of public Subscriptions: interest. Paper or fiche 202–741–6005 Documents are on file for public inspection in the Office of the Assistance with Federal agency subscriptions 202–741–6005 Federal Register the day before they are published, unless the issuing agency requests earlier filing. For a list of documents currently on file for public inspection, see http://www.nara.gov/ fedreg. What’s NEW! The seal of the National Archives and Records Administration Federal Register Table of Contents via e-mail authenticates the Federal Register as the official serial publication Subscribe to FEDREGTOC, to receive the Federal Register Table of established under the Federal Register Act. Under 44 U.S.C. 1507, Contents in your e-mail every day. the contents of the Federal Register shall be judicially noticed. The Federal Register is published in paper and on 24x microfiche. If you get the HTML version, you can click directly to any document It is also available online at no charge as one of the databases in the issue. on GPO Access, a service of the U.S. Government Printing Office. To subscribe, go to http://listserv.access.gpo.gov and select: The online edition of the Federal Register www.access.gpo.gov/ Online mailing list archives nara, available through GPO Access, is issued under the authority of the Administrative Committee of the Federal Register as the FEDREGTOC-L official legal equivalent of the paper and microfiche editions (44 Join or leave the list U.S.C. 4101 and 1 CFR 5.10). It is updated by 6 a.m. each day Then follow the instructions. the Federal Register is published and includes both text and graphics from Volume 59, Number 1 ( 2, 1994) forward. For more information about GPO Access, contact the GPO Access User Support Team, call toll free 1-888-293-6498; DC area 202- 512-1530; fax at 202-512-1262; or via email at [email protected]. The Support Team is available between 7:00 a.m. and 9:00 p.m. Eastern Time, Monday–Friday, except official holidays. The annual subscription price for the Federal Register paper edition is $699, or $764 for a combined Federal Register, Federal Register Index and List of CFR Sections Affected (LSA) subscription; the microfiche edition of the Federal Register including the Federal Register Index and LSA is $264. Six month subscriptions are available for one-half the annual rate. The charge for individual copies in paper form is $10.00 for each issue, or $10.00 for each group of pages as actually bound; or $2.00 for each issue in microfiche form. All prices include regular domestic postage and handling. International customers please add 40% for foreign handling. Remit check or money order, made payable to the Superintendent of Documents, or charge to your GPO Deposit Account, VISA, MasterCard, American Express, or Discover. Mail to: New Orders, Superintendent of Documents, P.O. Box 371954, Pittsburgh, PA 15250-7954; or call toll free 1-866-512-1800, DC area 202-512-1800; or go to the U.S. Government Online Bookstore site, [email protected]. There are no restrictions on the republication of material appearing in the Federal Register. How To Cite This Publication: Use the volume number and the page number. Example: 68 FR 12345. Postmaster: Send address changes to the Superintendent of Documents, Federal Register, U.S. Government Printing Office, Washington DC 20402, along with the entire mailing label from the last issue received.

.

VerDate jul 14 2003 21:10 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4710 Sfmt 4710 E:\FR\FM\28NOWS.LOC 28NOWS

2 III

Contents Federal Register Vol. 68, No. 229

Friday, , 2003

Agricultural Marketing Service Coast Guard RULES NOTICES Milk marketing orders: Meetings: Central, 66697–66699 Baltimore Captain of Port Area Maritime Security Committee, 66845 Agriculture Department Merchant Marine Personnel Advisory Committee, 66845– See Agricultural Marketing Service 66846 See Forest Service Commerce Department Antitrust Division See Census Bureau NOTICES See International Trade Administration Competitive impact statements and proposed consent See National Institute of Standards and Technology judgments: See National Oceanic and Atmospheric Administration Univision Communications Inc., 66854–66873 NOTICES Agency information collection activities; proposals, Army Department submissions, and approvals, 66797–66798 RULES Acquisition regulations: Committee for Purchase From People Who Are Blind or Foreign acquisition; contractors accompanying the force; Severely Disabled deployment of contractor personnel in support of NOTICES military operations, 66738–66740 Procurement list; additions and deletions, 66796–66797 Solicitation provisions and contract clauses; contractors Defense Department accompanying the force, 66740–66741 See Army Department PROPOSED RULES Blind or Severely Disabled, Committee for Purchase From Federal Acquisition Regulation (FAR): People Who Are Cost principles and penalties for unallowable costs; See Committee for Purchase From People Who Are Blind applicability, 66987–66989 or Severely Disabled NOTICES Agency information collection activities; proposals, Census Bureau submissions, and approvals, 66822 NOTICES Surveys, determinations, etc.: Defense Nuclear Facilities Safety Board Manufacturing area; annual, 66798–66799 NOTICES Retail trade; annual, 66799 Meetings; Sunshine Act, 66822–66823

Centers for Disease Control and Prevention Education Department NOTICES NOTICES Grants and cooperative agreements; availability, etc.: Agency information collection activities; proposals, Association between exposure to media violence and submissions, and approvals, 66823 youth violence; research program, 66829–66834 Smoke Alarm Installation and Fire Safety Education Employment and Training Administration Program; community trial to test effectiveness, NOTICES 66834–66839 Adjustment assistance: Authentic Fitness Corp. et al., 66873–66875 Centers for Medicare & Medicaid Services Biddle Precision Components, 66875 RULES Bose Corp., 66875 Medicare: Carm Newsome Hosiery, Inc., 66875 Medicare+Choice plans; Medicare Part B premium EDM Corp., 66875 reduction, 66721–66723 Fall River Manufacturing II, 66875 Medicare and Medicaid: Fishing Vessels— Religious nonmedical health care institutions and AQUARIUS, 66876 advance directives, 66710–66721 BIG DOG et al., 66876 PROPOSED RULES DEBORAH RENEE, 66876 Medicare: ELDORADO, 66875–66876 Hospital inpatient services of psychiatric facilities; FAMILY PRIDE, 66876 prospective payment system, 66919–66978 Halmode Apparel, Inc., 66876–66877 Henredon Furniture, Industries, 66877 Citizenship and Immigration Services Bureau Lucent Technologies, 66877 NOTICES Pulaski Furniture Corp. et al., 66877–66882 Agency information collection activities; proposals, Romac Industries, Inc., 66882–66883 submissions, and approvals, 66843–66845 Silicon Graphics, Inc., 66883

VerDate jul<14>2003 21:12 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4748 Sfmt 4748 E:\FR\FM\28NOCN.SGM 28NOCN IV Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Contents

Snap-Tite, Inc., 66883 NOTICES Southeastern Adhesives Co., 66883 Agency information collection activities; proposals, Textron, 66883 submissions, and approvals, 66826–66827 West Coast Fashion, Inc., 66883–66884 Agency information collection activities; proposals, Federal Deposit Insurance Corporation submissions, and approvals, 66884–66885 NOTICES Meetings: Employment Standards Administration Meetings; Sunshine Act, 66827–66828 NOTICES Minimum wages for Federal and federally-assisted Federal Election Commission construction; general wage determination decisions, RULES 66885–66886 Bipartisan Campaign Reform Act; implementation: Presidential candidates and nominating conventions; Environmental Protection Agency public financing NOTICES Effective date and correction, 66699 Environmental statements; availability, etc.: NOTICES Agency statements— Meetings; Sunshine Act, 66828 Comment availability, 66824 Weekly receipts, 66824–66825 Federal Maritime Commission Superfund; response and remedial actions, proposed NOTICES settlements, etc.: Ocean transportation intermediary licenses: Illinois Central Railroad Company’s Johnston Yard Site, Asiana Transport Inc. et al., 66828 TN, 66825 G.C. International Forwarding Co. et al., 66828–66829 Lakewood Treating, Inc. Site, SC, 66825 Internet Shipping Line et al., 66829 Water pollution control: National Pollutant Discharge Elimination System— Fish and Wildlife Service Massachusetts and New Hampshire; hydroelectric RULES generating facilities discharges; general permits, Marine mammals: 66826 Incidental take during specified activities— , AK; oil and gas industry exploration, Executive Office of the President development, and production operations; polar See Presidential Documents bears and Pacific walrus, 66744–66761 NOTICES Export-Import Bank Endangered and threatened species and marine mammal NOTICES permit applications, 66850–66851 Meetings: Environmental statements; availability, etc.: Advisory Committee, 66826 Incidental take permits— Clark County, WA; J.L. Storedahl & Sons, Inc.; habitat Federal Aviation Administration conservation plan, 66820–66821 RULES Class D airspace, 66699–66700 Forest Service Class E airspace, 66700–66702 NOTICES PROPOSED RULES Airworthiness directives: Meetings: Aerospatiale, 66772–66775 Resource Advisory Committees— Airbus, 66762–66764 Catron County, 66796 Boeing, 66764–66765 Lassen County, 66796 Bombardier, 66765–66768 McDonnell Douglas, 66768–66772 General Services Administration PROPOSED RULES Federal Communications Commission Federal Acquisition Regulation (FAR): RULES Cost principles and penalties for unallowable costs; Television broadcasting: applicability, 66987–66989 Digital cable products; commercial availability of navigation devices and compatibility between cable Health and Human Services Department systems and consumer electronics equipment, See Centers for Disease Control and Prevention 66728–66738 See Centers for Medicare & Medicaid Services PROPOSED RULES See National Institutes of Health Digital television stations; table of assignments: See Substance Abuse and Mental Health Services Idaho, 66781–66782 Administration New York; correction, 66781 Radio stations; table of assignments: Homeland Security Department Various States, 66782 See Citizenship and Immigration Services Bureau Television broadcasting: See Coast Guard Digital cable products; commercial availability of See Immigration and Customs Enforcement Bureau navigation devices and compatibility between cable NOTICES systems and consumer electronics equipment, Homeland Security Center designations: 66776–66781 University of Southern California, 66842–66843

VerDate jul<14>2003 21:12 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4748 Sfmt 4748 E:\FR\FM\28NOCN.SGM 28NOCN Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Contents V

Housing and Urban Development Department Labor Department RULES See Employment and Training Administration Public and Indian housing: See Employment Standards Administration Native Hawaiian Housing Block Grant and Loan Guarantees for Native Hawaiian Housing Programs, Maritime Administration 66979–66985 NOTICES NOTICES Agency information collection activities; proposals, Agency information collection activities; proposals, submissions, and approvals, 66917 submissions, and approvals, 66847–66849 Grants and cooperative agreements; availability, etc.: National Aeronautics and Space Administration Facilities to assist homeless— PROPOSED RULES Excess and surplus Federal property, 66849 Federal Acquisition Regulation (FAR): Cost principles and penalties for unallowable costs; Immigration and Customs Enforcement Bureau applicability, 66987–66989 NOTICES NOTICES Patent licenses; non-exclusive, exclusive, or partially Agency information collection activities; proposals, exclusive: submissions, and approvals, 66846–66847 Air Systems, Inc., 66886 Interior Department National Communications System See Fish and Wildlife Service NOTICES RULES Meetings: Hearings and appeals procedures: National Security Telecommunications Advisory Surface coal mining; special rules, 66723–66728 Committee, 66886 NOTICES Agency information collection activities; proposals, National Highway Traffic Safety Administration submissions, and approvals, 66849–66850 RULES Meetings: Motor vehicle safety standards: Guam War Claims Review Commission, 66850 Child restraint systems— Harnesses for use on school bus seats; expiration date Internal Revenue Service delay, 66741–66743 RULES Income taxes: National Institute of Standards and Technology Nonaccrual-experience method of accounting; use RULES limitation National Construction Safety Team Act; implementation, Correction, 66707–66708 66703–66707 PROPOSED RULES Income taxes: National Institutes of Health Contingent payment debt instruments for one or more NOTICES payments denominated in or determined by reference Meetings: to nonfunctional currency; treatment National Institute of Allergy and Infectious Diseases, Correction, 66776 66841 National Institute of Dental and Craniofacial Research, International Trade Administration 66840 NOTICES National Institute of Environmental Health Sciences, Antidumping: 66841 Color television receivers from— National Institute on Alcohol Abuse and Alcoholism, China, 66800–66810 66840 Color televisions from— National Institute on Deafness and Other Communication Malaysia, 66810–66816 Disorders, 66839–66840 Floor-standing, metal top ironing tables and parts from— Scientific Review Center, 66841–66842 China, 66816 National Oceanic and Atmospheric Administration Granular polytetrafluroetheylene resin from— PROPOSED RULES Japan, 66817 Fishery conservation and management: Antidumping and countervailing duties: Atlantic highly migratory species— Administrative review requests, 66799–66800 Atlantic pelagic longline fishery; sea turtle bycatch mitigation; environmental impact statement, International Trade Commission 66783–66784 NOTICES Northeastern United States fisheries— Import investigations: Summer flounder, scup, and black sea bass, 66784– Carbazole violet pigment 23 from— 66795 China and India, 66851–66852 NOTICES Sildenafil or any pharmaceutically acceptable salt, such Agency information collection activities; proposals, as sildenafil citrate, and products containing same, submissions, and approvals, 66817–66819 66852–66853 Endangered and threatened species: Andromous fish take— Justice Department Natural Resource Scientists, Inc., et al.; California See Antitrust Division Central Valley steelhead, 66819–66820

VerDate jul<14>2003 21:12 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4748 Sfmt 4748 E:\FR\FM\28NOCN.SGM 28NOCN VI Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Contents

Environmental statements; availability, etc.: Special Counsel Office Incidental take permits— RULES Clark County, WA; J.L. Storedahl & Sons, Inc.; habitat Complaints and allegations; filing requirements and conservation plan, 66820–66821 options, including electronic filing, 66695–66697 Meetings: Gulf of Mexico Fishery Management Council, 66821– State Department 66822 NOTICES Meetings: Neighborhood Reinvestment Corporation Defense Trade Advisory Group, 66916 NOTICES Meetings; Sunshine Act, 66887 Substance Abuse and Mental Health Services Administration NOTICES Nuclear Regulatory Commission Meetings: NOTICES SAMHSA National Advisory Council, 66842 Meetings; Sunshine Act, 66887 Tennessee Valley Authority Presidential Documents NOTICES ADMINISTRATIVE ORDERS Agency information collection activities; proposals, International Criminal Court; waiving prohibition on submissions, and approvals, 66916 United States military assistance to parties to the Rome Statute (Presidential Determination No. 2004-04-09 of Transportation Department , 2003), 66693 See Federal Aviation Administration See Maritime Administration Securities and Exchange Commission See National Highway Traffic Safety Administration NOTICES RULES Securities: Aviation proceedings: Security holders and boards of directors; nominating Agreements filed; weekly receipts, 66916 committee functions and communications; disclosure requirements, 66991–67011 Treasury Department NOTICES See Internal Revenue Service Investment Company Act of 1940: RULES Deregistration applications— Currency and foreign transactions; financial reporting and First Philippine Fund Inc. et al., 66887–66888 recordkeeping requirements: Exemption applications— Bank Secrecy Act; implementation— First Trust Portfolios, L.P., et al., 66890–66892 Funds transmittal by financial institutions; conditional Hennion & Walsh, Inc., et al., 66888–66890 exception expiration, 66708–66710 Options Price Reporting Authority: Consolidated Options Last Sale Reports and Quotation Information; Reporting Plan; amendments, 66892– Separate Parts In This Issue 66898 Self-regulatory organizations; proposed rule changes: Part II American Stock Exchange LLC, 66898–66908 Health and Human Services Department, Centers for Chicago Board Options Exchange, Inc., 66908 Medicare & Medicaid Services, 66919–66978 International Stock Exchange, Inc., 66909–66910 National Association of Securities Dealers, Inc., 66910– Part III 66912 Housing and Urban Development Department, 66979–66985 Philadelphia Stock Exchange, Inc., 66912–66913 Part IV Small Business Administration Defense Department; General Services Administration; NOTICES National Aeronautics and Space Administration, Committees; establishment, renewal, termination, etc.: 66987–66989 National Advisory Council et al., 66913 Meetings: Part V Regulatory Fairness Boards— Securities and Exchange Commission, 66991–67011 Region IV; hearing, 66913

Social Security Administration Reader Aids NOTICES Consult the Reader Aids section at the end of this issue for Agency information collection activities; proposals, phone numbers, online resources, finding aids, reminders, submissions, and approvals, 66913–66915 and notice of recently enacted public laws. Meetings: To subscribe to the Federal Register Table of Contents Ticket to Work and Work Incentives Advisory Panel; LISTSERV electronic mailing list, go to http:// teleconference, 66915 listserv.access.gpo.gov and select Online mailing list Senior Executive Service: archives, FEDREGTOC-L, Join or leave the list (or change Performance Review Board; membership, 66915–66916 settings); then follow the instructions.

VerDate jul<14>2003 21:12 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4748 Sfmt 4748 E:\FR\FM\28NOCN.SGM 28NOCN Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Contents VII

CFR PARTS AFFECTED IN THIS ISSUE

A cumulative list of the parts affected this month can be found in the Reader Aids section at the end of this issue.

3 CFR 48 CFR Administrative Orders: 5125...... 66738 Presidential 5152...... 66740 Determinations: Proposed Rules: No. 2004-09 of 15...... 66988 November 21, 31...... 66988 2003 ...... 66693 42...... 66988 5 CFR 49 CFR 1800...... 66695 571...... 66741 7 CFR 50 CFR 1032...... 66697 18...... 66744 11 CFR Proposed Rules: 104...... 66699 635...... 66783 107...... 66699 648...... 66784 110...... 66699 9001...... 66699 9003...... 66699 9004...... 66699 9008...... 66699 9031...... 66699 9032...... 66699 9033...... 66699 9034...... 66699 9035...... 66699 9036...... 66699 9038...... 66699 14 CFR 71 (3 documents) ...... 66699, 66700, 66701 Proposed Rules: 39 (6 documents) ...... 66762, 66764, 66765, 66768, 66770, 66772 15 CFR 270...... 66703 17 CFR 228...... 66992 229...... 66992 240...... 66992 249...... 66992 270...... 66992 274...... 66992 24 CFR 1006...... 66980 1007...... 66980 26 CFR 1...... 66707 Proposed Rules: 1...... 66776 31 CFR 103...... 66708 42 CFR 403...... 66710 408...... 66721 489...... 66710 498...... 66710 Proposed Rules: 412...... 66920 413...... 66920 424...... 66920 43 CFR 4...... 66723 47 CFR 15...... 66728 76...... 66728 Proposed Rules: 15...... 66728 73 (3 documents) ...... 66781, 66782 76...... 66776

VerDate jul 14 2003 21:13 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4711 Sfmt 4711 E:\FR\FM\28NOLS.LOC 28NOLS 66693

Federal Register Presidential Documents Vol. 68, No. 229

Friday, November 28, 2003

Title 3— Presidential Determination No. 2004–09 of November 21, 2003

The President Waiving Prohibition on United States Military Assistance to Parties to the Rome Statute Establishing the International Criminal Court

Memorandum for the Secretary of State

Consistent with the authority vested in me by section 2007 of the American Servicemembers’ Protection Act of 2002 (the ‘‘Act’’), title II of Public Law 107–206 (22 U.S.C. 7421 et seq.), I hereby: • Determine that it is important to the national interest of the United States to waive the prohibition of section 2007 (a) with respect to Bulgaria, Estonia, Latvia, Lithuania, Slovakia, and Slovenia, with respect to military assistance for only certain specific projects that I have decided are needed to support the process of integration of these countries into NATO, or to support Operation ENDURING FREEDOM or Operation IRAQI FREEDOM; and • Waive the prohibition with respect to the projects referred to above for these countries. You are authorized and directed to report this determination and the accom- panying Memorandum of Justification, prepared by my Administration, to the Congress, and to arrange for publication of this determination in the Federal Register. W THE WHITE HOUSE, Washington, November 21, 2003.

[FR Doc. 03–29854 Filed 11–26–03; 8:45 am] Billing code 4710–10–P

VerDate jul<14>2003 08:31 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4705 Sfmt 4790 E:\FR\FM\28NOO0.SGM 28NOO0 66695

Rules and Regulations Federal Register Vol. 68, No. 229

Friday, November 28, 2003

This section of the FEDERAL REGISTER maintain records electronically, when the private sector within the meaning of contains regulatory documents having general practicable. OSC has been working to the UMRA. applicability and legal effect, most of which comply with GPEA in stages by first are keyed to and codified in the Code of Executive Order 12866 (Regulatory offering complaint and disclosure forms Planning and Review): OSC anticipates Federal Regulations, which is published under to be printed from OSC’s web site; then 50 titles pursuant to 44 U.S.C. 1510. that the economic impact of this adding the capability of filling the forms revision will be insignificant. Thus this out on-line and submitting them by mail The Code of Federal Regulations is sold by proposed revision is not a significant the Superintendent of Documents. Prices of or fax to OSC; and finally by offering new books are listed in the first FEDERAL electronic filing. These options are regulatory action under section 3(f) of REGISTER issue of each week. described on the OSC Web site at http:/ Executive Order 12866, and does not /www.osc.gov (under ‘‘Forms’’). This require an assessment of potential costs revision of OSC regulations on filing and benefits under section 6(a)(3) of the OFFICE OF SPECIAL COUNSEL complaints and disclosures with OSC is order. intended to present clear information on Executive Order 12988 (Civil Justice 5 CFR Part 1800 all available options for such filings. Reform): This proposed rule meets Revision of Regulations To Describe Procedural Determinations applicable standards of section 3(a) and 3(b)(2) of Executive Order 12988. Filing Requirements and Options, Administrative Procedure Act (APA) Including Electronic Filing This action is taken under the Special Executive Order 13132 (Federalism): AGENCY: U.S. Office of Special Counsel. Counsel’s authority, at 5 U.S.C. 1212(e), This proposed revision does not have to publish regulations in the Federal new federalism implications under ACTION: Final rule. Register. Under the Administrative Executive Order 13132. The Hatch Act, SUMMARY: The U.S. Office of Special Procedure Act, at 5 U.S.C. 553(b)(3)(B), at title 5 of the U.S. Code, chapter 15, Counsel (OSC) is revising its regulations statutory procedures for agency prohibits certain political activities of on filing to state filing requirements and rulemaking do not apply ‘‘when the covered state and local government options more clearly and to provide agency for good cause finds (and employees. The OSC has jurisdiction to information on where to find incorporates the finding and a brief issue advisory opinions on political instructions for electronic filing with statement of reasons therefore in the activity by those employees, and to OSC. rules issued) that notice and public bring an enforcement action before the DATES: This rule will be effective procedure thereon are impracticable, Merit Systems Protection Board for 1, 2003. unnecessary, or contrary to the public prohibited activity by a covered state or interest.’’ OSC finds that such notice FOR FURTHER INFORMATION CONTACT: local government employee. However, and public procedure are unnecessary Kathryn Stackhouse, General Law this proposed revision does not and contrary to the public interest Counsel, in writing at: U.S. Office of because: (1) these revisions more clearly substantively affect the rights of state Special Counsel, Legal Counsel and describe filing options at OSC; and (2) and local government employees. Policy Division, 1730 M Street NW., the public benefits from early notice of Rather, these revised regulations simply Suite 218, Washington, DC 20036–4505; additional filing options, and further provide information on options for by telephone at (202) 653–8971; or by delay is unnecessary and contrary to the filing an allegation of a violation of the facsimile at (202) 653–5151. public interest. Hatch Act, or a request for an advisory SUPPLEMENTARY INFORMATION: The U.S. Congressional Review Act (CRA): OSC opinion on the Hatch Act with OSC. Office of Special Counsel (OSC) is has determined that these revisions are List of Subjects in 5 CFR Part 1800 revising its regulations governing filing non-major under the Congressional of: (1) complaints of prohibited Review Act, and is submitting a report Administrative practice and personnel practices or other prohibited on this final rule to Congress and the procedure, Government employees, activity; (2) disclosures of information; General Accounting Office pursuant to Investigations, Law enforcement, and (3) requests for advisory opinions the act. The rule is effective December on the Hatch Act, under 5 CFR 1800.1, Political activities (Government 1, 2003, as permitted by 5 U.S.C. 808. employees), Reporting and 1800.2, and 1800.3. These revisions are Regulatory Flexibility Act (RFA): The recordkeeping requirements, intended to more clearly describe the Regulatory Flexibility Act does not Whistleblowing. requirements and options for filing apply, as this rule is not subject to complaints, disclosures and requests for notice and comment procedures under ■ For the reasons stated in the preamble, advisory opinions, and to direct the APA. OSC amends 5 CFR part 1800 as follows: potential filers to OSC’s web site for Paperwork Reduction Act (PRA): OSC information and instructions on has received OMB approval of the PART 1800–FILING OF COMPLAINTS electronic filing of complaints and Forms OSC–11 and OSC–12, which are AND ALLEGATIONS disclosures (at http://www.osc.gov). The referenced in the regulations, for use Government Paperwork Elimination Act through 31, 2006, including use ■ 1. The authority citation for Part 1800 (GPEA, Pub. L. 105–277) requires of these forms for electronic filing. continues to read as follows: Federal agencies to provide individuals Unfunded Mandates Reform Act Authority: 5 U.S.C. 1212(e). or entities that deal with agencies the (UMRA): This proposed revision does option to submit information or transact not impose any Federal mandates on ■ 2. Section 1800.1 is revised to read as with the agency electronically, and to State, local, or tribal governments, or on follows:

VerDate jul<14>2003 14:44 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66696 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

§ 1800.1 Filing complaints of prohibited (2) Violation of the state and local (i) By writing to OSC, at: Office of personnel practices or other prohibited Hatch Act at title 5 of the U.S. Code, Special Counsel, Complaints Examining activities. chapter 15; Unit, 1730 M Street NW., Suite 218, (a) Prohibited personnel practices. (3) Arbitrary and capricious Washington, DC 20036–4505; The Office of Special Counsel (OSC) has withholding of information prohibited (ii) By calling OSC, at: (800) 872–9855 investigative jurisdiction over the under the Freedom of Information Act at (toll-free), or (202) 653–7188 (in the following prohibited personnel 5 U.S.C. 552 (except for certain foreign Washington, DC area); or practices committed against current or and counterintelligence information); (iii) Online, at: http://www.osc.gov (to former Federal employees and (4) Activities prohibited by any civil print out and complete on paper, or to applicants for Federal employment: service law, rule, or regulation, complete online). (1) Discrimination, including including any activity relating to (5) A complainant can file a discrimination based on marital status political intrusion in personnel completed Form OSC–11 with OSC by or political affiliation (see §1810.1 of decisionmaking; any of the following methods: this chapter for information about OSC’s (5) Involvement by any employee in (i) By mail, to: Office of Special deferral policy); any prohibited discrimination found by Counsel, Complaints Examining Unit, (2) Soliciting or considering improper any court or appropriate administrative 1730 M Street NW., Suite 218, recommendations or statements about authority to have occurred in the course Washington, DC 20036–4505; individuals requesting, or under of any personnel action (unless the (ii) By fax, to: (202) 653–5151; or consideration for, personnel actions; Special Counsel determines that the (iii) Electronically, at: http:// (3) Coercing political activity, or allegation be resolved more www.osc.gov. engaging in reprisal for refusal to engage appropriately under an administrative (d) Procedures for filing complaints in political activity; appeals procedure); and alleging violation of the Hatch Act. (4) Deceiving or obstructing anyone (6) Violation of uniformed services (1) Complaints alleging a violation of with respect to competition for employment and reemployment rights the Hatch Act may be submitted in any employment; under 38 U.S.C. 4301, et seq. written form, but should include: (5) Influencing anyone to withdraw (c) Procedures for filing complaints (i) The complainant’s name, mailing from competition to improve or injure alleging prohibited personnel practices address, telephone number, and a time the employment prospects of another; or other prohibited activities (other than when OSC can contact that person about (6) Granting an unauthorized the Hatch Act). his or her complaint (unless the matter preference or advantage to improve or (1) Current or former Federal is submitted anonymously); injure the employment prospects of employees, and applicants for Federal (ii) The department or agency, another; employment, may file a complaint with (7) Nepotism; location, and organizational unit (8) Reprisal for whistleblowing OSC alleging one or more prohibited complained of; and (whistleblowing is generally defined as personnel practices, or other prohibited (iii) A concise description of the the disclosure of information about a activities within OSC’s investigative actions complained about, names and Federal agency by an employee or jurisdiction. Form OSC–11 (‘‘Complaint positions of employees who took the applicant who reasonably believes that of Possible Prohibited Personnel actions, if known to the complainant, the information shows a violation of any Practice or Other Prohibited Activity’’) and dates of the actions, preferably in law, rule, or regulation; gross must be used to file all such complaints chronological order, together with any mismanagement; gross waste of funds; (except those limited to an allegation or documentary evidence that the abuse of authority; or a substantial and allegations of a Hatch Act violation - see complainant can provide. specific danger to public health or paragraph (d) of this section for (2) A written Hatch Act complaint can safety); information on filing Hatch Act be filed with OSC by any of the methods (9) Reprisal for: complaints). listed in paragraph (c)(5)(i)-(iii) of this (i) Exercising certain appeal rights; (2) Part 2 of Form OSC–11 must be section. (ii) Providing testimony or other completed in connection with ■ 3. Section 1800.2 is revised to read as assistance to persons exercising appeal allegations of reprisal for follows: rights; whistleblowing, including identification (iii) Cooperating with the Special of: § 1800.2 Filing disclosures of information. Counsel or an Inspector General; or (i) Each disclosure involved; (a) General. OSC is authorized by law (iv) Refusing to obey an order that (ii) The date of each disclosure; (at 5 U.S.C. 1213) to provide an would require the violation of law; (iii) The person to whom each independent and secure channel for use (10) Discrimination based on personal disclosure was made; and by current or former Federal employees conduct not adverse to job performance; (iv) The type and date of any and applicants for Federal employment (11) Violation of a veterans’ personnel action that occurred because in disclosing information that they preference requirement; and of each disclosure. reasonably believe shows wrongdoing (12) Taking or failing to take a (3) Except for complaints limited to by a Federal agency. OSC must personnel action in violation of any law, alleged violation(s) of the Hatch Act, determine whether there is a substantial rule, or regulation implementing or OSC will not process a complaint filed likelihood that the information discloses directly concerning merit system in any format other than a completed a violation of any law, rule, or principles at 5 U.S.C. 2301(b). Form OSC–11. If a filer does not use regulation; gross mismanagement; gross (b) Other prohibited activities. OSC Form OSC–11 to submit a complaint, waste of funds; abuse of authority; or a also has investigative jurisdiction over OSC will provide the filer with substantial and specific danger to public allegations of the following prohibited information about the form. The health or safety. If it does, the law activities: complaint will be considered to be filed requires OSC to refer the information to (1) Violation of the Federal Hatch Act on the date on which OSC receives a the agency head involved for at title 5 of the U.S. Code, chapter 73, completed Form OSC–11. investigation and a written report on the subchapter III; (4) Form OSC–11 is available: findings to the Special Counsel. The law

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66697

does not authorize OSC to investigate opinion from OSC by any of the diversion limits; and establish a ‘‘net the subject of a disclosure. following methods: shipments’’ provision for milk (b) Procedures for filing disclosures. (a) By phone, at: (800) 854–2824 (toll- deliveries to distributing plants. For Current or former Federal employees, free), or (202) 653–7143 (in the Producer milk, this final rule continues and applicants for Federal employment, Washington, DC area); to adopt amendments which: Establish may file a disclosure of the type of (b) By mail, to: Office of Special higher year-round diversion limits; base information described in paragraph (a) Counsel, Hatch Act Unit, 1730 M Street diversion limits for supply plants on of this section with OSC. Such NW., Suite 218, Washington, DC 20036– deliveries to Central order distributing disclosures must be filed in writing 4505; plants; and eliminate the ability to (including electronically - see paragraph (c) By fax, to: (202) 653–5151; or simultaneously pool the same milk on (b)(3)(iii) of this section). (d) By e-mail, to: [email protected]. the Central order and a State-operated (1) Filers are encouraged to use Form Dated: , 2003 milk order that has marketwide pooling. OSC–12 (‘‘Disclosure of Information’’) to This administrative rule is governed William E. Reukauf, file a disclosure of the type of by the provisions of sections 556 and information described in paragraph (a) Acting Special Counsel. 557 of Title 5 of the United States Code of this section with OSC. This form [FR Doc. 03–29518 Filed 11–26–03; 8:45 am] and, therefore, is excluded from the provides more information about OSC BILLING CODE 7405–01–S requirements of Executive Order 12866. jurisdiction, and procedures for This final rule has been reviewed processing whistleblower disclosures. under Executive Order 12988, Civil Form OSC–12 is available: DEPARTMENT OF AGRICULTURE Justice Reform. This rule is not intended (i) By writing to OSC, at: Office of to have a retroactive effect. This rule Special Counsel, Disclosure Unit, 1730 Agricultural Marketing Service will not preempt any State or local laws, M Street NW., Suite 218, Washington, regulations, or policies, unless they DC 20036–4505; 7 CFR Part 1032 present an irreconcilable conflict with (ii) By calling OSC, at: (800) 572–2249 [Docket No. DA–01–07; AO–313–A44] the rule. (toll-free), or (202) 653–9125 (in the The Agricultural Marketing Washington, DC area); or Milk in the Central Marketing Area; Agreement Act of 1937, as amended (7 (iii) Online, at: http://www.osc.gov (to Order Amending the Order U.S.C. 601–674), provides that print out and complete on paper, or to administrative proceedings must be complete online). AGENCY: Agricultural Marketing Service, exhausted before parties may file suit in (2) Filers may use another written USDA. court. Under Section 608c(15)(A) of the format to submit a disclosure to OSC, ACTION: Final rule. Act, any handler subject to an order may but the submission should include: request modification or exemption from (i) The name, mailing address, and SUMMARY: This document adopts as a such order by filing with the telephone number(s) of the person(s) final rule, without change, an interim Department of Agriculture (USDA) a making the disclosure(s), and a time final rule concerning pooling provisions petition stating that the order, any when OSC can contact that person about of the Central milk order. More than the provision of the order, or any obligation his or her disclosure; required number of producers in the imposed in connection with the order is (ii) The department or agency, Central marketing area have approved not in accordance with the law. A location and organizational unit the issuance of the final order handler is afforded the opportunity for complained of; and amendments. a hearing on the petition. After a (iii) A statement as to whether the EFFECTIVE DATE: , 2003. hearing, the Department would rule on the petition. The Act provides that the filer consents to disclosure of his or her FOR FURTHER INFORMATION CONTACT: Jack identity by OSC to the agency involved, Rower or Carol S. Warlick, Marketing District Court of the United States in in connection with any OSC referral to Specialists, USDA/AMS/Dairy any district in which the handler is an that agency. Programs, Order Formulation and inhabitant, or has its principal place of (3) A disclosure can be filed in Enforcement Branch, Stop 0231—Room business, has jurisdiction in equity to writing with OSC by any of the 2971, 1400 Independence Avenue, SW., review the Department’s ruling on the following methods: Washington, DC 20250–0231, (202) 720– petition, provided a bill in equity is (i) By mail, to: Office of Special 2357, e-mail address: filed not later than 20 days after the date Counsel, Disclosure Unit, 1730 M Street [email protected], or (202) 720– of the entry of the ruling. NW., Suite 218, Washington, DC 20036– 9363, e-mail address: Regulatory Flexibility Act and 4505; [email protected]. Paperwork Reduction Act (ii) By fax, to: (202) 653–5151; or (iii) Electronically, at: http:// SUPPLEMENTARY INFORMATION: This In accordance with the Regulatory www.osc.gov. document adopts as a final rule, without Flexibility Act (5 U.S.C. 601 et seq.), the ■ 4. Section 1800.3 is revised to read as change, an interim final rule concerning Agricultural Marketing Service has follows: pooling provisions of the Central milk considered the economic impact of this order. Specifically, this final rule action on small entities and has certified § 1800.3 Advisory opinions. continues to amend the Pool plant that this rule will not have a significant The Special Counsel is authorized to provisions which: Establish lower but economic impact on a substantial issue advisory opinions only about year-round supply plant performance number of small entities. For the political activity of state or local officers standards; do not consider the volume purpose of the Regulatory Flexibility and employees (under title 5 of the of milk shipments to distributing plants Act, a dairy farm is considered a ‘‘small United States Code, at chapter 15), and regulated by another Federal milk order business’’ if it has an annual gross political activity of Federal officers and as a qualifying shipment on the Central revenue of less than $750,000, and a employees (under title 5 of the United order; exclude from receipts diverted dairy products manufacturer is a ‘‘small States Code, at chapter 73, subchapter milk made by a pool plant to another business’’ if it has fewer than 500 III). A person can seek an advisory pool plant in determining pool plant employees.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66698 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

For the purposes of determining proposed and no additional reporting price of feeds, available supplies of which dairy farms are ‘‘small requirements would be necessary. feeds, and other economic conditions businesses,’’ the $750,000 per year This action does not require which affect market supply and demand criterion was used to establish a additional information collection that for milk in the marketing area, and the production guideline of 500,000 pounds requires clearance by the Office of minimum prices specified in the order, per month. Management and Budget beyond as hereby amended, are such prices as Although this guideline does not currently approved information will reflect the aforesaid factors, insure factor in additional monies that may be collection. The primary sources of data a sufficient quantity of pure and received by dairy producers, it should used to complete the forms are routinely wholesome milk, and be in the public be an inclusive standard for most used in most business transactions. interest; and ‘‘small’’ dairy farmers. For purposes of Forms require only a minimal amount of (3) The Central order, as hereby determining a handler’s size, if the plant information which can be supplied amended, regulates the handling of milk is part of a larger company operating without data processing equipment or a in the same manner as, and is applicable multiple plants that collectively exceed trained statistical staff. Thus, the only to persons in the respective classes the 500-employee limit, the plant will information collection and reporting of industrial and commercial activity be considered a large business even if burden is relatively small. Requiring the specified in, a marketing agreement the local plant has fewer than 500 same reports for all handlers does not upon which a hearing has been held. employees. significantly disadvantage any handler (B) Additional Findings. It is Of the 10,108 dairy producers that is smaller than the industry necessary in the public interest to make (farmers) whose milk was pooled under average. these amendments to the Central order the Central order at the time of the Prior Documents in This Proceeding: effective December 1, 2003. hearing (November 2001) 9,695 or 95.9 The amendments to these orders are percent would meet the definition of Notice of Hearing: Issued 17, 2001; published , 2001 (66 known to handlers. The final decision small businesses. On the processing containing the proposed amendments to side, 10 of the 56 milk plants associated FR 53551). Tentative Final Decision: Issued these orders was issued on , with the Central order during November 2003. These proposed amendments are 2001 would qualify as ‘‘small , 2002; published , 2002 (67 FR 69910). identical to the amendments in the businesses,’’ constituting about 18 Interim Final Rule published in the percent of the total. Interim Final Rule: Issued 6, 2003; published , 2003 (68 Federal Register on February 12, 2003 Based on these criteria, more than 95 FR 7070). (68 FR 7070), regulating the handling of percent of the producers would be Final Decision: Issued August 18, milk in the Central marketing area. considered as small businesses. The 2003; published , 2003 (68 FR The changes that result from these adoption of the proposed pooling 51640). amendments will not require extensive standards serves to revise the criteria preparation or substantial alteration in Findings and Determinations that determine those producers, the method of operation for handlers. In producer milk, and plants that have a The findings and determinations view of the foregoing, it is hereby found reasonable association with, and are hereinafter set forth supplement those and determined that good cause exists consistently serving the fluid needs of, that were made when the Central order for making these order amendments the Central milk marketing area and are was first issued and when it was effective December 1, 2003. It would be not associated with other marketwide amended. The previous findings and contrary to the public interest to delay pools concerning the same milk. Criteria determinations are hereby ratified and the effective date of these amendments for pooling are established on the basis confirmed, except where they may for 30 days after their publication in the of performance levels that are conflict with those set forth herein. Federal Register. (Sec. 553(d), considered adequate to meet the Class I The following findings are hereby Administrative Procedure Act, 5 U.S.C. fluid needs and, by doing so, determine made with respect to the Central order: 551–559.) those that are eligible to share in the (A) Findings upon the basis of the revenue that arises from the classified (C) Determinations. It is hereby hearing record. Pursuant to the determined that: pricing of milk. Criteria for pooling are provisions of the Agricultural Marketing (1) The refusal or failure of handlers established without regard to the size of Agreement Act of 1937, as amended (7 (excluding cooperative associations any dairy industry organization or U.S.C. 601–674), and the applicable specified in Sec. 8c(9) of the Act) of entity. The criteria established are rules of practice and procedure more than 50 percent of the milk, which applied in an identical fashion to both governing the formulation of marketing is marketed within the specified large and small businesses and do not agreements and marketing orders (7 CFR marketing area, to sign a proposed have any different economic impact on part 900), a public hearing was held marketing agreement, tends to prevent small entities as opposed to large upon certain proposed amendments to the effectuation of the declared policy of entities. Therefore, the amendments will the tentative marketing agreement and the Act; not have a significant economic impact to the order regulating the handling of on a substantial number of small milk in the Central marketing area. (2) The issuance of this order entities. Upon the basis of the evidence amending the Central order is the only A review of reporting requirements introduced at such hearing and the practical means pursuant to the was completed under the Paperwork record thereof it is found that: declared policy of the Act of advancing Reduction Act of 1995 (44 U.S.C. (1) The Central order, as hereby the interests of producers as defined in Chapter 35). It was determined that amended, and all of the terms and the order as hereby amended; these amendments would have no conditions thereof, will tend to (3) The issuance of the order impact on reporting, recordkeeping, or effectuate the declared policy of the Act; amending the Central order is favored other compliance requirements because (2) The parity prices of milk, as by at least two-thirds of the producers they would remain identical to the determined pursuant to section 2 of the who were engaged in the production of current requirements. No new forms are Act, are not reasonable in view of the milk for sale in the marketing area.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66699

List of Subjects in 7 CFR Part 1032 a document in the Federal Register of incorrectly identified 11 CFR 9031.1 as Milk marketing orders. , 2003, at 68 FR 47386, 11 CFR 9003.1. Thus, this correction containing revised regulations at 11 CFR changes this reference in amendatory Order Relative to Handling 104.5, 107.2, 110.2, 9001.1, 9003.1, instruction 29 in the third column on ■ It is therefore ordered, that on and after 9003.3, 9003.5, 9004.4, 9008.3, 9008.7, page 47418 from ‘‘11 CFR 9003.1’’ to ‘‘11 the effective date of this document, the 9008.8, 9008.10, 9008.12, 9008.50, CFR 9031.1.’’ 9008.51, 9008.52, 9008.53, 9031.1, handling of milk in the Central Announcement of Effective Date marketing area shall be in conformity to 9032.9, 9033.1, 9033.11, 9034.4, 9035.1, and in compliance with the terms and 9036.1, 9036.2, and 9038.2, and new ■ New 11 CFR 9004.11, 9008.55, conditions of the order, as amended, and regulations at 11 CFR 9004.11, 9008.55, 9034.10, and 9034.11 and amended 11 as hereby further amended, as follows: 9034.10, and 9034.11. The Commission CFR 104.5, 107.2, 110.2, 9001.1, 9003.1, is announcing the effective date for 9003.3, 9003.5, 9004.4, 9008.3, 9008.7, PART 1032—MILK IN THE CENTRAL these regulations. Section 9009(c) of 9008.8, 9008.10, 9008.12, 9008.50, MARKETING AREA Title 26, United States Code, require 9008.51, 9008.52, 9008.53, 9031.1, that any rules or regulations prescribed 9032.9, 9033.1, 9033.11, 9034.4, 9035.1, ■ The interim final rule amending 7 CFR by the Commission to carry out the 9036.1, 9036.2, and 9038.2, as published part 1032 which was published at 68 FR provisions of the Presidential Election at 68 FR 47386 (Aug. 8, 2003), and as 7070 on February 12, 2003, is adopted as Campaign Fund Act be transmitted to corrected herein, are effective as of a final rule without change. the Speaker of the House of November 28, 2003. Dated: November 19, 2003. Representatives and the President of the Correction of Publication A.J. Yates, Senate thirty legislative days prior to Administrator, Agricultural Marketing final promulgation. These rules were ■ In rule FR Doc 03–19893, published on Service. transmitted to Congress on 31, August 8, 2003 (68 FR 47386), make the [FR Doc. 03–29624 Filed 11–26–03; 8:45 am] 2003. Thirty legislative days expired in following corrections. On page 47403, in BILLING CODE 3410–02–P the Senate and the House of the third column, in the thirty-fourth line Representatives on November 4, 2003. from the bottom, remove ‘‘11 CFR ■ The Commission’s document 9008.55(d)—’’. On page 47404, in the FEDERAL ELECTION COMMISSION published in the Federal Register on second column, in the sixth line from the August 8, 2003, contained three bottom (not including footnote text), 11 CFR Parts 104, 107, 110, 9001, 9003, incorrect references and one incorrect replace ‘‘11 CFR 9008.55(e)’’ with ‘‘11 9004, 9008, 9031, 9032, 9033, 9034, amendatory instruction. First, the CFR 9008.55(d)’’. On page 47404, in the 9035, 9036, and 9038 document as published included a third column, in the fourth line from the [Notice 2003–23] reference to a provision that was not bottom (not including footnote text), adopted by the Commission. That replace ‘‘11 CFR 9008.55(e)’’ with ‘‘11 Public Financing of Presidential provision was originally located in 11 CFR 9008.55(d)’’. On page 47418, in the Candidates and Nominating CFR 9008.55(d). Prior to adopting the third column, in the second through fifth Conventions; Announcement of final rules, the Commission deleted 11 lines from the top, correct the Effective Date and Correction CFR 9008.55(d) and redesignated amendatory instruction 29 to read as paragraph (e) of 11 CFR 9008.55 as follows: AGENCY: Federal Election Commission. paragraph (d). While this change was ■ 29. Section 9031.1 is amended by ACTION: Final rules; announcement of reflected in the regulatory text of 11 CFR removing the number ‘‘116’’ and adding effective date and correction. 9008.55 and in its Explanation and in its place the number ‘‘400’’ in both Justification, the deleted provision was instances in which ‘‘116’’ appears. SUMMARY: The Federal Election Commission announces that the final cited as 11 CFR 9008.55(d) in one Dated: November 21, 2003. rules governing the public financing of instance. See 69 FR 47403 (third Ellen L. Weintraub, Presidential candidates and nominating column). Thus, this correction deletes Chair, Federal Election Commission. the misleading reference to ‘‘11 CFR conventions that were published in the [FR Doc. 03–29616 Filed 11–26–03; 8:45 am] Federal Register on August 8, 2003, 68 9008.55(d)’’ in the third column on page 47403. BILLING CODE 6715–01–P FR 47386, are effective as of November ■ 28, 2003. Additionally, the Commission Second, the document as published contained two incorrect references to the is publishing a correction to the final DEPARTMENT OF TRANSPORTATION rules. The correction: Removes the provision that was proposed to be 11 citation ‘‘11 CFR 9008.55(d)’’ from a CFR 9008.55(e) but was redesignated in Federal Aviation Administration subject heading; changes two references the final regulations to be 11 CFR from ‘‘11 CFR 9008.55(e)’’ to ‘‘11 CFR 9008.55(d). This change was reflected in 14 CFR Part 71 9008.55(d)’’; and corrects an the regulatory text of 11 CFR 9008.55, but the Explanation and Justification for 11 [Docket No. FAA–2003–15532; Airspace amendatory instruction. The corrections Docket No. 03–ASO–10] also are effective as of November 28, CFR 9008.55 cited the redesignated provision as 11 CFR 9008.55(e) in two 2003. Establishment of Class D Airspace; instances. See 69 FR 47404 (second and Columbus, MS EFFECTIVE DATE: November 28, 2003. third columns). Thus, this correction FOR FURTHER INFORMATION CONTACT: Ms. changes the references in the second and AGENCY: Federal Aviation Mai T. Dinh, Acting Assistant General third columns on page 47404 from ‘‘11 Administration (FAA), DOT. Counsel, 999 E Street, NW., CFR 9008.55(e)’’ to ‘‘11 CFR 9008.55(d).’’ ACTION: Final rule. Washington, DC 20463, (202) 694–1650 ■ Third, the document as published or (800) 424–9530. contained one incorrect amendatory SUMMARY: This action establishes Class SUPPLEMENTARY INFORMATION: The instruction. Amendatory instruction 29 D airspace at Columbus, MS. A federal Federal Election Commission published in the third column on page 47418, contract tower with a weather reporting

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66700 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

system has been constructed at the when promulgated, will not have a DEPARTMENT OF TRANSPORTATION Golden Triangle Regional Airport. significant economic impact on a Therefore, the airport meets criteria for substantial number of small entities Federal Aviation Administration Class D airspace. Class D surface area under the criteria of the Regulatory airspace is required when the control Flexibility Act. 14 CFR Part 71 tower is open to contain Standard List of Subjects in 14 CFR Part 71 [Docket No. FAA–2003–16497; Airspace Instrument Approach Procedures Docket No. 03–ACE–81] (SIAPs) and other Instrument Flight Airspace, Incorporation by reference, Rules (IFR) operations at the airport. Modification of Class E Airspace; Navigation (Air). This action establishes Class D airspace Milford, IA extending upward from the surface to Adoption of the Amendment AGENCY: and including 2,800 feet MSL within a Federal Aviation 4.1-mile radius of the airport. ■ In consideration of the foregoing, the Administration (FAA), DOT. ACTION: Direct final rule; request for EFFECTIVE DATE: 0901 UTC, , Federal Aviation Administration 2004. proposes to amend 14 CFR Part 71 as comments. FOR FURTHER INFORMATION CONTACT: follows: SUMMARY: This action modifies the Class Walter R. Cochran, Manager, Airspace E airspace area at Milford, IA. A review Branch, Air Traffic Division, Federal PART 71—DESIGNATION OF CLASS A, of controlled airspace for Fuller Airport, Aviation Administration, P.O. Box CLASS B, CLASS C, CLASS D, AND Milford, IA, indicates it does not 20636, Atlanta, Georgia 30320; CLASS E AIRSPACE AREAS; comply with the criteria for 700 feet telephone (404) 305–5627. AIRWAYS; ROUTES; AND REPORTING Above Ground Level (AGL) airspace SUPPLEMENTARY INFORMATION: POINTS required for diverse departures as specified in FAA Order 7400.2E. The History ■ 1. The authority citation for Part 71 area is enlarged to conform to the On , 2003, the FAA proposed continues to read as follows: criteria in FAA Order 7400.2E. to amend part 71 of the Federal Aviation Authority: 49 U.S.C. 106(g); 40103, 40113, DATES: This direct final rule is effective Regulations (14 CFR part 71) by 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959– on 0901 UTC, February 19, 2004. establishing Class D airspace at 1963 Comp., p. 389. Comments for inclusion in the Rules Columbus, MS, (68 FR 43340). This Docket must be received on or before action provides adequate Class D § 71.1 [Amended] , 2003. airspace for IFR operations at Golden ■ 2. The incorporation by reference in 14 ADDRESSES: Send comments on this rule Triangle Regional Airport. Designations CFR 71.1 of Federal Aviation to the Docket Management System, U.S. for Class D are published in FAA Order Administration Order 7400.9L, Airspace Department of Transportation, Room 7400.9L, dated 2, 2003, and Plaza 401, 400 Seventh Street, SW., effective , 2003, which is Designations and Reporting Points, dated , 2003, and effective Washington, DC 20590–0001. You must incorporated by reference in 14 CFR identify the docket number FAA–2003– part 71.1. The Class D designations September 16, 2003, is amended as follows: 16497/Airspace Docket No. 03–ACE–81, listed in this document will be at the beginning of your comments. You published subsequently in the Order. Paragraph 5000 Class D Airspace. may also submit comments on the Interested parties were invited to Internet at http://dms.dot.gov. You may participate in this rulemaking ASO MS D Columbus Golden Triangle, MS [NEW] review the public docket containing the proceeding by submitting written proposal, any comments received, and comments on the proposal to the FAA. Golden Triangle Regional Airport, MS ° ′ ″ ° ′ ″ any final disposition in person in the No comments objecting to the proposal (Lat. 33 27 01 N, long. 88 35 29 W) Dockets Office between 9 a.m. and 5 were received. That airspace extending upward from the p.m., Monday through Friday, except The Rule surface to and including 2,800 feet MSL Federal holidays. The Docket Office within a 4.1-mile radius of the Golden (telephone 1–800–647–5527) is on the This amendment to part 71 of the Triangle Regional Airport. This Class D plaza level of the Department of Federal Aviation Regulations (14 CFR airspace area is effective during the specific Transportation NASSIF Building at the part 71) establishes Class D airspace at days and times established in advance by a above address. Columbus, MS. Notice to Airmen. The effective days and The FAA has determined that this times will thereafter be continuously FOR FURTHER INFORMATION CONTACT: proposed regulation only involves an published in the Airport/Facility Directory. Kathy Randolph, Air Traffic Division, Airspace Branch, ACE–520C, DOT established body of technical * * * * * regulations for which frequent and Municipal Headquarters Building, routine amendments are necessary to Issued in College Park, Georgia, on October Federal Aviation Administration, 901 keep them operationally current. It, 29, 2003. Locust, Kansas City, MO 64106; therefore, (1) is not a ‘‘significant Walter R. Cochran, telephone: (816) 329–2525. regulatory action’’ under Executive Acting Manager, Air Traffic Division, SUPPLEMENTARY INFORMATION: This Order 12866; (2) is not a ‘‘significant Southern Region. amendment to 14 CFR 71 modifies the rule’’ under DOT Regulatory Policies [FR Doc. 03–28536 Filed 11–26–03; 8:45 am] Class E airspace area extending upward and Procedures (44 FR 11034; February BILLING CODE 4910–13–M from 700 feet above the surface of the 26, 1979); and (3) does not warrant earth at Milford, IA. An examination of preparation of a Regulatory Evaluation controlled airspace for Fuller Airport as the anticipated impact is so minimal. reveals it does not meet the criteria for Since this is a routine matter that will 700 AGL airspace required for diverse only affect air traffic procedures and air departures as specified in FAA Order navigation, it is certified that this rule, 7400.2E, Procedures for Handling

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66701

Airspace Matters. The criteria in FAA triplicate to the address listed above. Paragraph 6005 Class E airspace areas Order 7400.2E for an aircraft to reach Commenters wishing the FAA to extending upward from 700 feet or more 1200 feet AGL is based on a standard acknowledge receipt of their comments above the surface of the earth. climb gradient of 200 feet per mile plus on this notice must submit with those * * * * * the distance from the Airport Reference comments a self-addressed, stamped ACE IA E5 Milford, IA Point (ARP) to the end of the outermost postcard on which the following ° ′ ″ runway. Any fractional part of a mile is statement is made: ‘‘Comments to Milford, Fuller Airport, IA (Lat. 43 19 59 N., long. 95°09′33″ W.) converted to the next higher tenth of a Docket No. FAA–2003–16497/Airspace That airspace extending upward from 700 mile. This amendment brings the legal Docket No. 03–ACE–81.’’ The postcard feet above the surface within a 6.3-mile description of the Milford, IA Class E will be date/time stamped and returned radius of Fuller Airport, excluding that airspace area into compliance with FAA to the commenter. airspace within the Spencer, IA Class E Order 7400.2E. This area will be airspace area. Agency Findings depicted on appropriate aeronautical * * * * * charts. Class E airspace areas extending The regulations adopted herein will upward from 700 feet or more above the not have a substantial direct effect on Issued in Kansas City, MO, on , 2003. surface of the earth are published in the States, on the relationship between paragraph 6005 of FAA Order 7400.9L, the national Government and the States, Paul J. Sheridan, dated September 2, 2003, and effective or on the distribution of power and Acting Manager, Air Traffic Division, Central September 16, 2003, which is responsibilities among the various Region. incorporated by reference in 14 CFR levels of government. Therefore, it is [FR Doc. 03–29452 Filed 11–26–03; 8:45 am] 71.1. The Class E airspace designation determined that this final rule does not BILLING CODE 4910–13–M listed in this document will be have federalism implications under published subsequently in the Order. Executive Order 13132. The FAA has determined that this DEPARTMENT OF TRANSPORTATION The Direct Final Rule Procedure regulation is noncontroversial and The FAA anticipates that this unlikely to result in adverse or negative Federal Aviation Administration regulation will not result in adverse or comments. For the reasons discussed in negative comment and, therefore, is the preamble, I certfy that this 14 CFR Part 71 issuing it as a direct final rule. Previous regulation (1) is not a ‘‘significant [Docket No. FAA–2003–16496; Airspace actions of this nature have not been regulatory action’’ under Executive Docket No. 03–ACE–80] controversial and have not resulted in Order 12866; (2) is not ‘‘significant rule’’ adverse comments or objections. Unless under Department of Transportation Modification of Class E Airspace; a written adverse or negative comment, (DOT) Regulatory Policies and Mapleton, IA or a written notice of intent to submit Procedures (44 FR 11034, , AGENCY: Federal Aviation an adverse or negative comment is 1979); and (3) if promulgated, will not Administration (FAA), DOT. received within the comment period, have a significant economic impact, ACTION: Direct final rule; request for the regulation will become effective on positive or negative, on a substantial comments. the date specified above. After the close number of small entities under the of the comment period, the FAA will criteria of the Regulatory Flexibility Act. SUMMARY: Mapleton Municipal Airport publish a document in the Federal List of Subjects in 14 CFR Part 71 has been renamed James G. Whiting Register indicating that no adverse or Memorial Field. A review of controlled negative comments were receiving and Airspace, Incorporation by reference, airspace for Mapleton, IA indicates it confirming the date on which the final Navigation (air). does not comply with the criteria for rule will become effective. If the FAA Adoption of the Amendment 700 feet Above Ground Level (AGL) does receive, within the comment airspace required for diverse departures. period, an adverse or negative comment, ■ Accordingly, the Federal Aviation This action replaces ‘‘Mapleton or written notice of intent to the submit Administration amends 14 CFR part 71 Municipal Airport’’ in the legal such a comment, a document as follows: description of Mapleton, IA Class E withdrawing the direct final rule will be airspace area with ‘‘James G. Whiting published in the Federal Register, and PART 71—DESIGNATION OF CLASS A, CLASS B, CLASS C, CLASS D, AND Memorial Field.’’ It also enlarges the a notice of proposed rulemaking may be area to provide adequate protection for published with a new comment period. CLASS E AIRSPACE AREAS; AIRWAYS; ROUTES; AND REPORTING diverse departures and brings the legal Comments Invited POINTS description into compliance with FAA Orders. Interested parties are invited to ■ 1. The authority citation for part 71 participate in this rulemaking by DATES: This direct final rule is effective continues to read as follows: submitting such written data, views, or on 0901 UTC, February 19, 2004. arguments, as they may desire. Authority: 49 U.S.C. 106(g), 40103, 40113, Comments for inclusion in the Rules Comments that provide the factual basis 40120; E.O. 10854, 24 FR 9656, 3 CFR, 1959– Docket must be received on or before 1963 Comp., p. 389. supporting the views and suggestions December 31, 2003. presented are particularly helpful in § 71.1 [Amended] ADDRESSES: Send comments on this rule developed reasoned regulatory ■ 2. The incorporation by reference in 14 to the Docket Management System, U.S. decisions on the proposal. Comments CFR 71.1 of Federal Aviation Department of Transportation, Room are specifically invited on the overall Administration Order 7400.9L, dated Plaza 401, 400 Seventh Street, SW., regulatory, aeronautical, economic, September 2, 2003, and effective Washington, DC 20590–0001. You must environmental, and energy-related September 16, 2003, is amended as identify the docket number FAA–2003– aspects of the proposal. follows: 16496/Airspace Docket No. 03–ACE–80, Communications should identify both at the beginning of your comments. You docket numbers and be submitted in * * * * * may also submit comments on the

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66702 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Internet at http://dms.dot.gov. You may issuing it as a direct final rule. Previous regulation (1) is not a ‘‘significant review the public docket containing the actions of this nature have not been regulatory action’’ under Executive proposal, any comments received, and controversial and have not resulted in Order 12866; (2) is not a ‘‘significant any final disposition in person in the adverse comments or objections. Unless rule’’ under Department of Dockets Office between 9 a.m. and 5 a written adverse or negative comment, Transportation (DOT) Regulatory p.m., Monday through Friday, except or a written notice of intent to submit Policies and Procedure (44 FR 11034, Federal holidays. The Docket Office an adverse or negative comment is February 26, 1979); and (3) if (telephone 1–800–647–5527) is on the received within the comment period, promulgated, will not have a significant plaza level of the Department of the regulation will become effective on economic impact, positive or negative, Transportation NASSIF Building at the the date specified above. After the close on a substantial number of small entities above address. of the comment period, the FAA will under the criteria of the Regulatory FOR FURTHER INFORMATION CONTACT: publish a document in the Federal Flexibility Act. Register indicating that no adverse or Kathy Randolph, Air Traffic Division, List of Subjects in 14 CFR Part 71 Airspace Branch, ACE–520C, DOT negative comments were received and Regional Headquarters Building, Federal confirming the date on which the final Airspace, Incorporation by reference, Aviation Administration, 901 Locust, rule will become effective. If the FAA Navigation (air). Kansas City, MO 64106; telephone: does receive, within the comment (816) 329–2525. period, an adverse or negative comment, Adoption of the Amendment or written notice of intent to submit SUPPLEMENTARY INFORMATION: This such a comment, a document ■ Accordingly, the Federal Aviation amendment to 14 CFR 71 modifies the withdrawing the direct final rule will be Administration amends 14 CFR part 71 Class E airspace area extending upward published in the Federal Register and a as follows: from 700 feet above the surface at notice of proposed rulemaking may be Mapleton, IA. It replaces ‘‘Mapleton published with a new comment period. PART 71—DESIGNATION OF CLASS A, Municipal Airport,’’ the former name of CLASS B, CLASS C, CLASS D, AND the airport, with ‘‘James G. Whiting Comments Invited CLASS E AIRSPACE AREAS; Memorial field,’’ the new name of the Interested parties are invited to AIRWAYS; ROUTES; AND REPORTING airport, in the legal description. A participate in this rulemaking by POINTS review of controlled airspace at submitting such written data, views, or Mapleton, IA indicates 700 feet Above arguments, as they may desire. ■ 1. The authority citation for part 71 Ground Level (AGL) airspace required Comments that provide the factual basis continues to read as follows: for diverse departures, as specified in supporting the views and suggestions Authority: 49 U.S.C. 106(g), 40103, 40113, FAA Order 7400.2E, Procedures for presented are particularly helpful in 40120, E.O. 10854, 24 FR 9565, 3 CFR , 1959– Handling Airspace Matters, for James G. developing reasoned regulatory 1963 Comp., p. 389, Whiting Memorial Field does not decisions on the proposal. Comments comply with the Order. The criteria in are specifically invited on the overall § 71.1 Amended FAA Order 7400.2E for an aircraft to regulatory, aeronautical, economic, ■ 2. The incorporation by reference in 14 reach 1200 feet AGL is based on a environmental, and energy-related CFR 71.1 of Federal Aviation standard climb gradient of 200 feet per aspects of the proposal. Administration Order 7400.9L, dated mile plus the distance from the Airport Communications should identify both September 2, 2003, and effective Reference Point (ARP) to the end of the docket numbers and be submitted in September 16, 2003, is amended as outermost runway. Any fractional part triplicate to the address listed above. follows: of a mile is converted to the next higher Commenters wishing the FAA to tenth of a mile. The area is enlarged to acknowledge receipt of their comments Paragraph 6005 Class E airspace areas conform to the criteria in FAA Order on this notice must submit with those extending upward from 700 feet or more 7400.2E. This action also modifies the comments a self-addressed, stamped above the surface of the earth. northeast extension of the Mapleton, IA postcard on which the following * * * * * Class E airspace area by defining it with statement is made: ‘‘Comments to ACE IA E5 Mapleton, IA the 030° bearing from the Mapleton Docket No. FAA–2003–16496/Airspace NDB versus the current 032° bearing. It Mapleton, James G. Whiting Memorial Field, Docket No. 03–ACE–80.’’ The postcard IA brings the legal description of this will be date/time stamped and retuned (Lat. 42°10′42″ N., long. 95°47′37″ W.). airspace area into compliance with FAA to the commenter. Maplelon NDB Order 7400.2E. The area will be ° ′ ″ ° ′ ″ Agency Findings (Lat. 42 10 50 N., long. 95 47 41 W.) depicted on appropriate aeronautical That airspace extending upward from 700 charts. Class E airspace areas extending The regulations adopted herein will feet above the surface within a 6.3-mile upward from 700 feet or more above the not have a substantial direct effect on radius of James G. Whiting Memorial Field; surface of the earth are published in the States, on the relationship between and within 3.1 miles each side of the 030° paragraph 6005 of FAA Order 7400.9L, the national Government and the States, bearing from the Mapleton NDB extending dated September 2, 2003, and effective or on the distribution of power and from the 6.3-mile radius to 10 miles northeast September 16, 2003, which is responsibilities among the various of the airport. incorporated by reference in 14 CFR levels of government. Therefore, it is * * * * * 71.1. The Class E airspace designation determine that this final rule does not listed in this document will be have federalism implications under Issued in Kansas City, MO, on November published subsequently in the Order. Executive Order 13132. 14, 2003. The FAA has determined that this Paul J. Sheridan, The Direct Final Rule Procedure regulation is noncontroversial and Acting Manager, Air Traffic Division, Central The FAA anticipates that this unlikely to result in adverse or negative Region. regulation will not result in adverse or comments. For the reasons discussed in [FR Doc. 03–29451 Filed 11–26–03; 8:45 am] negative comment and, therefore, is the preamble, I certify that this BILLING CODE 4910–13–M

VerDate jul<14>2003 14:44 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66703

DEPARTMENT OF COMMERCE resulted in substantial loss of life or that necessary to the conduct of the posed significant potential of substantial investigation of the World Trade Center National Institute of Standards and loss of life. The purpose of disaster, already underway, and became Technology investigations by Teams is to improve effective immediately upon publication. the safety and structural integrity of The comment period closed on 3, 15 CFR Part 270 buildings in the United States. A Team 2003. On , 2003, NIST published [Docket No. 030421094–3094–01] will (1) establish the likely technical a final rule in the Federal Register (68 cause or causes of the building failure; FR 24343), addressing the comments RIN 0693–AB53 (2) evaluate the technical aspects of received. evacuation and emergency response The interim final rule amends section Procedures for Implementation of the procedures; (3) recommend, as National Construction Safety Team Act 270.1, Description of rule; purpose, necessary, specific improvements to applicability, of the final rule to clarify AGENCY: National Institute of Standards building standards, codes, and practices NIST’s role in recommending and Technology, Department of based on the findings made pursuant to improvements to building codes, Commerce. (1) and (2); and (4) recommend any standards, and practices and to clarify research and other appropriate actions ACTION: the relationship between investigations Interim final rule; request for needed to improve the structural safety conducted under the Act and criminal comments. of buildings, and improve evacuation investigations of the same building and emergency response procedures, SUMMARY: The Director of the National failure. This interim final rule also based on the findings of the Institute of Standards and Technology amends the definition of Credentials, investigation. Section 2(c)(1) of the Act (NIST), Technology Administration, contained in section 270.2, to clarify requires that the Director develop United States Department of Commerce, that credentials are issued by the procedures for certain activities to be requests comments on an interim final Director of NIST and to better define the carried out under the Act as follows: rule pertaining to the implementation of term. This interim final rule also sets Regarding conflicts of interest related to the National Construction Safety Team forth procedures regarding conflicts of Act (‘‘Act’’). The interim final rule service on a Team; defining the circumstances under which the Director interest related to service on a Team clarifies NIST’s role in recommending (section 270.106); defining the improvements to building codes, will establish and deploy a Team; prescribing the appropriate size of circumstances under which the Director standards, and practices, and clarifies will establish and deploy a Team the relationship between investigations Teams; guiding the disclosure of information under section 7 of the Act; (section 270.102); prescribing the conducted under the Act and criminal appropriate size of Teams (section investigations of the same building guiding the conduct of investigations under the Act; identifying and 270.104); guiding the conduct of failure. The interim final rule also investigations under the Act (section establishes procedures regarding the prescribing appropriate conditions for provision by the Director of additional 270.200); identifying and prescribing establishment and deployment of appropriate conditions for provision by National Construction Safety Teams resources and services Teams may need; to ensure that investigations under the the Director of additional resources and (‘‘Teams’’) and for the conduct of services Teams may need (section investigations under the Act. Act do not impede and are coordinated with any search and rescue efforts being 270.204); to ensure that investigations DATES: This interim rule is effective undertaken at the site of the building under the Act do not impede and are November 28, 2003. Comments must be failure; for regular briefings of the coordinated with any search and rescue received no later than , public on the status of the investigative efforts being undertaken at the site of 2003. proceedings and findings; guiding the the building failure (section 270.202); ADDRESSES: Comments on the interim Teams in moving and preserving for regular briefings of the public on the final rule regulations must be submitted evidence; providing for coordination status of the investigative proceedings to: Dr. James E. Hill, Acting Director, with Federal, State, and local entities and findings (section 270.206); Building and Fire Research Laboratory, that may sponsor research or providing for coordination with Federal, National Institute of Standards and investigations of building failures; and State, and local entities that may Technology, Mail Stop 8600, regarding other issues. sponsor research or investigations of Gaithersburg, MD 20899–8600, NIST published an interim final rule building failures (section 270.203); and telephone number (301) 975–5900. with a request for public comments in regarding other issues. This interim FOR FURTHER INFORMATION CONTACT: Dr. the Federal Register on , final rule also amends section 270.313, James E. Hill, Acting Director, Building 2003 (68 FR 4693), seeking public Requests for Evidence, to clarify that and Fire Research Laboratory, National comment on general provisions collections of evidence under that Institute of Standards and Technology, regarding implementation of the Act section are investigatory in nature and Mail Stop 8600, Gaithersburg, MD and on provisions establishing are not research. 20899–8600, telephone number (301) procedures for the collection and Research for Public Comment: 975–5900. preservation of evidence obtained and Persons interested in commenting on SUPPLEMENTARY INFORMATION: the protection of information created as the interim final rule should submit part of investigations conducted their comments in writing to the above Background pursuant to the Act, including guiding address. All comments received in The National Construction Safety the disclosure of information under response to this notice will become part Team Act, Pub. L. 107–231, was enacted section 7 of the Act (§§ 270.350, of the public record and will be to provide for the establishment of 270.351, and 270.352) and guiding the available for inspection and copying at investigative teams (‘‘Teams’’) to assess Teams in moving and preserving the Department of Commerce Central building performance and emergency evidence (§ 270.330). These general Reference and Records Inspection response and evacuation procedures in provisions and procedures, comprising facility, room 6228, Hoover Building, the wake of any building failure that has Subparts A and D of the rule, are Washington, DC 20230.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66704 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Additional Information PART 270—NATIONAL 270.102 Conditions for establishment and CONSTRUCTION SAFETY TEAMS deployment of a team. Executive Order 12866 270.103 Publication in the Federal Register. ■ 270.104 Size and composition of a team. This rule has been determined not to 1. The authority citation for Part 270 as follows: 270.105 Duties of a team. be significant under section 3(f) of 270.106 Conflicts of interest related to Executive Order 12866. Authority: Pub. L. 107–231, 116 Stat. 1471 service on a team. (15 U.S.C. 7301 et seq.). Executive Order 12612 Subpart C—Investigations ■ 2. Section 270.1 is amended by 270.200 Technical conduct of investigation. This rule does not contain policies revising paragraph (b) to read as follows: 270.201 Priority of investigation. with Federalism implications sufficient 270.202 Coordination with search and § 2701. Description of rule; purpose, to warrant preparation of a Federalism rescue efforts. applicability. assessment under Executive Order 270.203 Coordination with Federal, State, 12612. * * * * * and local entities. (b)(1) The purpose of investigations 270.204 Provision of additional resources Administrative Procedure Act by Teams is to improve the safety and and services needed by a team. 270.205 Reports. Prior notice and an opportunity for structural integrity of buildings in the United States. The role of NIST in 270.206 Public briefings and requests for public comment are not required for this information. rule of agency organization, procedure, implementing the Act is to understand or practice. 5 U.S.C. 553(b)(A). the factors contributing to the building Subpart B—Establishment and However, NIST feels it important to seek failure and to develop recommendations Deployment of Teams public comment on the issues addressed for improving national building and fire § 270.100 General. in this rule. model codes, standards, and practices. To do this, the Teams produce technical (a) Historically, in the United States Regulatory Flexibility Act reports containing data, findings, and building failures from fire, earthquake, recommendations for consideration by hurricanes, tornadoes, and other Because notice and comment are not private sector bodies responsible for the disasters that have ‘‘resulted in required under 5 U.S.C. 553, or any affected national building and fire substantial loss of life or that posed other law, the analytical requirements of model code, standard, or practice. While significant potential for substantial loss the Regulatory Flexibility Act (5 U.S.C. NIST is an active participant in many of of life’’ have occurred at a frequency of 601 et seq.) are inapplicable. As such, a these organizations, NIST’s less than once per year. It is expected regulatory flexibility analysis is not recommendations are one of many that this pattern is likely to continue in required, and none has been prepared. factors considered by these bodies. NIST the future. Acts of terrorism causing a Paperwork Reduction Act is not now and will not become a building failure may occur at any time. participant in the processes and (b) For purposes of this part, a Notwithstanding any other provision adoption of practices, standards, or building failure may involve one or of the law, no person is required to, nor codes by state or local regulatory more of the following: structural system, shall any person be subject to penalty authorities. fire protection (active or passive) for failure to comply with, a collection (2) It is not NIST’s role to determine system, air-handling system, and of information, subject to the whether a failed building resulted from building control system. Teams requirements of the Paperwork a criminal act, violated any applicable established under the Act and this part Reduction Act, unless that collection of federal requirements or state or local will investigate these technical causes of information displays a currently valid code or regulatory requirements, or to building failures and will also OMB Control Number. determine any culpability associated investigate the technical aspects of There are no collections of therewith. These are matters for other evacuation and emergency response information involved in this federal, state, or local authorities, who procedures, including multiple- rulemaking. enforce their regulations. occupant behavior or evacuation (egress or access) system, emergency response National Environmental Policy Act * * * * * system, and emergency communication ■ 3. Section 270.2 is amended by This rule will not significantly affect system. revising the definition of Credentials to the quality of the human environment. (c) For purposes of this part, the read as follows: Therefore, an environmental assessment number of fatalities considered to be ‘‘substantial’’ will depend on the nature or Environmental Impact Statement is § 270.2 Definitions used in this part. of the event, its impact, its unusual or not required to be prepared under the * * * * * unforeseen character, historical norms, National Environmental Policy Act of Credentials. Credentials issued by the and other pertinent factors. 1969. Director, identifying a person as a List of Subjects in 15 CFR Part 270 member of a National Construction § 270.101 Preliminary reconnaissance. Safety Team, including photo (a) To the extent the Director deems Administrative practice and identification and other materials, it appropriate, the Director may conduct procedure; investigations; buildings and including badges, deemed appropriate a preliminary reconnaissance at the site facilities; evidence; subpoena. by the Director. of a building failure. The Director may Dated: November 21, 2003. * * * * * establish and deploy a Team to conduct the preliminary reconnaissance, as Arden L. Bement, Jr., ■ 4. Add new subparts B and C to read described in § 270.102 of this subpart, or Director. as follows: may have information gathered at the ■ For the reasons set forth in the Subpart B—Establishment and Deployment site of a building failure without preamble, the National Institute of of Teams establishing a Team. Standards and Technology amends 15 270.100 General. (b) If the Director establishes and CFR Part 270 as follows: 270.101 Preliminary reconnaissance. deploys a Team to conduct the

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66705

preliminary reconnaissance, the Team capabilities and experiences of a Team; fire, forensic, safety, architectural, and shall perform all duties pursuant to and materials engineering, and specialists in section 2(b)(2) of the Act, and may (3) If the technical cause of the failure emergency response, human behavior, perform all activities that Teams are is readily apparent, whether an and evacuation. authorized to perform under the Act and investigation is likely to result in (c) Duration of a Team. A Team’s term these procedures, including gathering relevant knowledge other than will end 3 months after the Team’s final and preserving evidence. At the reaffirmation of the technical cause; and public report is published, but the term completion of the preliminary (4) Whether deployment of a Team may be extended or terminated earlier reconnaissance, the Team will report its will substantially duplicate local or by the Director. findings to the Director in a timely state resources equal in investigatory § 270.105 Duties of a team. manner. The Director may either and analytical capability and quality to determine that the Team should a Team; and (a) A Team’s Lead Investigator will conduct further investigation, or may (5) Recommendations resulting from a organize, conduct, and control all direct the Team to prepare its public preliminary reconnaissance of the site of technical aspects of the investigation, report immediately. the building failure. up to and including the completion of (c) If the preliminary reconnaissance (c) To the maximum extent the final investigation public report and is conducted without the establishment practicable, the Director will establish any subsequent actions that may be of a Team, the leader of the initial and deploy a Team within 48 hours required. The Lead Investigator has the assessment will report his/her findings after such an event. responsibility and authority to supervise to the Director in a timely manner. The and coordinate all resources and § 270.103 Publication in the Federal activities of NIST personnel involved in Director will decide whether to Register. establish a Team and conduct an the investigation. The Lead Investigator investigation using the criteria The Director will promptly publish in may be the Contracting Officer’s established in § 270.102 of this subpart. the Federal Register notice of the Technical Representative (COTR) on establishment of each Team. any contract for service on the Team or § 270.102 Conditions for establishment in support of the Team; while the COTR § 270.104 Size and composition of a team. and deployment of a Team. remains the technical representative of (a) The Director may establish a Team (a) Size of a Team. The size of a Team the Contracting Officer for purposes of for deployment after an event that will depend upon the likely scope and contract administration, the Lead caused the failure of a building or complexity of the investigation. A Team Investigator will oversee all NIST buildings that resulted in substantial may consist of five or less members if personnel acting as COTRs for contracts loss of life or posed significant potential the investigation is narrowly focused, or for service on the Team or in support of for substantial loss of life. The Director a Team may consist of twenty or more the Team. The Lead Investigator’s duties will determine the following prior to members divided into groups if the will terminate upon termination of the deploying a Team: breadth of the investigation spans a Team. The Lead Investigator will keep (1) The event was any of the number of technical issues. In addition, the Director and the NCST Advisory following: Teams may be supported by others at Committee informed about the status of (i) A major failure of one or more NIST, in other federal agencies, and in investigations. buildings or types of buildings due to an the private sector, who may conduct (b) A Team will: extreme natural event (earthquake, supporting experiments, analysis, (1) Establish the likely technical cause hurricane, tornado, flood, etc.); interviews witnesses, and/or examine or causes of the building failure; (ii) A fire that resulted in major the response of first responders, (2) Evaluate the technical aspects of damage or destruction of the building of occupants, etc. evacuation and emergency response origin, and/or that spread beyond the (b) Composition of a Team. (1) A procedures; building of origin; Team will be composed of individuals (3) Recommend, as necessary, specific (iii) A major building failure at selected by the Director and led by a improvements to building standards, significantly less than its design basis, Lead Investigator designated by the codes, and practices based on the during construction, or while in active Director. findings made pursuant to paragraphs use; or (2) The Lead Investigator will be a (b)(1) and (b)(2) of this section; (iv) An act of terrorism or other event NIST employee, selected based on his/ (4) Recommend any research and resulting in a Presidential declaration of her technical qualifications, ability to other appropriate actions needed to disaster and activation of the Federal mobilize and lead a multi-disciplinary improve the structural safety of Response Plan; and investigative team, and ability to deal buildings, and improve evacuation and (2) A fact-finding investigation of the with sensitive issues and the media. emergency response procedures, based building performance and emergency (3) Team members will include at on the findings of the investigation; and response and evacuation procedures least one employee of NIST and will (5) Not later than 90 days after will likely result in significant and new include experts who are not employees completing an investigation, issue a knowledge or building code revision of NIST, who may include private sector public report in accordance with recommendations needed to reduce experts, university experts, § 270.205 of this subpart. public risk and economic losses from representatives of professional (c) In performing these duties, a Team future building failures. organizations with appropriate will: (b) In making the determinations expertise, and appropriate Federal, (1) Not interfere unnecessarily with pursuant to paragraph (a) of this section, State, or local officials. services provided by the owner or the Director will consider the following: (4) Team members who are not operator of the buildings, building (1) Whether sufficient financial and Federal employees will be Federal components, materials, artifacts, personnel resources are available to Government contractors. property, records, or facility; conduct an investigation; and (5) Teams may include members who (2) Preserve evidence related to the (2) Whether an investigation of the are experts in one or more of the building failure consistent with the building failure warrants the advanced following disciplines: civil, mechanical, ongoing needs of the investigation;

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66706 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

(3) Preserve evidence related to a authorized to perform under the Act and years depending on the complexity of criminal act that may have caused the these procedures, with a focus on the event. building failure; gathering and preserving evidence, (2) Tasks that may be completed (4) Not impede and coordinate its inspecting the site of the building during investigations that proceed investigation with any search and failure, and interviewing of beyond preliminary reconnaissance rescue efforts being undertaken at the eyewitnesses, survivors, and first include: site of the building failure; responders. Collections of evidence by a (i) Consult with experts in building (5) Coordinate its investigation with Team established for preliminary design and construction, fire protection qualified researchers who are reconnaissance are investigatory in engineering, emergency evacuation, and conducting engineering or scientific nature and will not be considered members of other investigation teams research (including social science) research for any purpose. At the involved in the event to identify relating to the building failure; completion of the preliminary technical issues and major hypotheses (6) Cooperate with State and local reconnaissance, the Team will report its requiring investigation. authorities carrying out any activities findings to the Director in a timely (ii) Collect data from the building(s) related to a Team’s investigation; manner. The Director may either owner and occupants, local authorities, (d) In performing these duties, in a determine that the Team should and contractors and suppliers. Such manner consistent with the procedures conduct further investigation, or may data will include relevant building and set forth in this part, a Team may: direct the Team to immediately prepare fire protection documents, records, (1) Enter property where a building the public report as required by section video and photographic data, field data, failure being investigated has occurred 8 of the Act. and data from interviews and other oral and take necessary, appropriate, and (3) If the preliminary reconnaissance and written accounts from building reasonable action to carry out the duties is conducted without the establishment occupants, emergency responders, and described in paragraph (b) of this of a Team, the leader of the initial other witnesses. section; assessment will report his/her findings (iii) Collect and analyze physical (2) Inspect any record, process, or to the Director in a timely manner. The evidence, including material samples facility related to the investigation Director will decide whether to and other forensic evidence, to the during reasonable hours; establish a team and conduct an extent they are available. (3) Inspect and test any building investigation using the criteria (iv) Determine the conditions in the components, materials, and artifacts established in § 270.102 of this part. building(s) prior to the event, which related to the building failure; and (b) Investigation plan. (1) If the may include the materials of (4) Move records, components, Director establishes a Team without construction and contents; the location, materials, and artifacts related to the ordering preliminary reconnaissance, size, and condition of all openings that building failure. establishes a Team after preliminary may have affected egress, entry, and fire reconnaissance, or establishes a Team to conditions (if applicable); the installed § 270.106 Conflicts of interest related to conduct preliminary reconnaissance security and/or fire protection systems service on a Team. and subsequently determines that (if applicable); the number of occupants (a) Team members who are not further investigation is necessary prior and their approximate locations at the Federal employees will be Federal to preparing the public report required time of the event. Government contractors. by section 8 of the Act, the Director, or (v) Reconstruct the event within the (b) Contracts between NIST and Team his/her designee, will formulate a plan building(s) using computer models to members will include appropriate that includes: identify the most probable technical provisions to ensure that potential (i) A brief description of the building cause (or causes) of the failure and the conflicts of interest that arise prior to failure; uncertainty(ies) associated with it award or during the contract are (ii) The criteria upon which the (them). Such models may include initial identified and resolved. decision to conduct the investigation damage, blast effects, pre-existing was based; deficiencies and phenomena such as fire Subpart C—Investigations (iii) Supporting effort(s) by other spread, smoke movement, tenability, organizations either in place or expected occupant behavior and response, § 270.200 Technical conduct of evacuation issues, cooperation of investigation. in the future; (iv) Identification of the Lead security and fire protection systems, and (a) Preliminary reconnaissance. (1) An Investigator and Team members; building collapse. initial assessment of the event, (v) The technical investigation plan; (vi) Conduct small and full-scale including an initial site reconnaissance, (vi) Site, community, and local, state, experiments to provide additional data if deemed appropriate by the Director, and Federal agency liaison status; and and verify the computer models being will be conducted. This assessment will (vii) Estimated duration and cost. used. be done within a few hours of the event, (2) To the extent practicable, the (vii) Examine the impact of alternate if possible. The Director may establish Director will include the most building/system/equipment design and and deploy a Team to conduct the appropriate expertise on each Team use on the survivability of the building preliminary reconnaissance, using the from within NIST, other government and its occupants. criteria established in § 270.102 of this agencies, and the private sector. The (viii) Analyze emergency evacuation part, or may have information gathered NCST Advisory Committee may be and occupant responses to better at the site of a building failure without convened as soon as feasible following understand the actions of the first establishing a Team. the launch of an investigation to provide responders and the impediments to safe (2) If the Director establishes and the Director the benefit of its advice on egress encountered by the occupants. deploys a Team to conduct the investigation Team activities. (ix) Analyze the relevant building preliminary reconnaissance, the Team (c) Investigation. (1) The duration of practices to determine the extent to shall perform all duties pursuant to an investigation that proceeds beyond which the circumstances that led to this section 2(b)(2) of the Act, and may preliminary reconnaissance will be as building failure have regional or perform all activities that Teams are little as a few months to as long as a few national implications.

VerDate jul<14>2003 14:44 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00012 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66707

(x) Identify specific areas in building disaster site, the Lead Investigator will (b) Requests for information on the and fire codes, standards, and building identify the lead of the search and plans and conduct of an investigation practices that may warrant revisions rescue operations and will work closely should be submitted to the NIST Public based on investigation findings. with that person to ensure coordination and Business Affairs Division. (xi) Identify research and other of efforts. ■ 5. Section 270.313 is amended by appropriate actions required to help § 270.203 Coordination with Federal, State, adding new paragraph (c) to read as prevent future building failures. follows: (d) If a disaster site contains multiple and local entities. building failures, the Director will NIST will enter into Memoranda of § 270.313 Requests for evidence. narrow the scope of the investigation Understanding with Federal, State, and * * * * * plan taking into account available local entities, as appropriate, to ensure (e) Collections of evidence under financial and personnel resources, and the coordination of investigations. paragraphs (b), (c), and (d) of this giving priority to failures offering the § 270.204 Provision of additional section are investigatory in nature and most opportunity to advance the safety resources and services needed by a team. will not be considered research for any of building codes. The Director may The Director will determine the purpose. consider the capabilities of NIST in appropriate resources that a Team will ■ 6. Section 270.315 is amended by establishing priorities. require to carry out its investigation and revising paragraph (a) to read as follows: § 270.201 Priority of investigation. will ensure that those resources are § 270.315 Subpoenas. available to the Team. (a) General. Except as provided in this (a) General. Subpoenas requiring the section, a Team investigation will have § 270.205 Reports. attendance of witnesses or the priority over any other investigation of (a) Not later than 90 days after production of documentary or physical any other Federal agency. completing an investigation, a Team evidence for the purpose of taking (b) Criminal acts. (1) If the Attorney shall issue a public report which depositions or at a hearing may be General, in consultation with the includes: issued only under the signature of the Director, determines, and notifies the (1) An analysis of the likely technical Director with the concurrence of the Director that circumstances reasonably cause or causes of the building failure General Counsel, but may be served by indicate that the building failure being investigated; any person designated by the Counsel investigated by a Team may have been (2) Any technical recommendations for NIST on behalf of the Director. caused by a criminal act, the Team will for changes to or the establishment of * * * * * relinquish investigative priority to the evacuation or emergency response [FR Doc. 03–29615 Filed 11–26–03; 8:45 am] appropriate law enforcement agency. procedures; (2) If a criminal investigation of the (3) Any recommended specific BILLING CODE 3510–13–P building failure being investigated by a improvements to building standards, Team is initiated at the state or local codes, and practices; and level, the Team will relinquish (4) Recommendations for research and DEPARTMENT OF THE TREASURY investigative priority to the appropriate other appropriate actions needed to help Internal Revenue Service law enforcement agency. prevent future building failures. (3) The relinquishment of (b) A Team that is directed to prepare 26 CFR Part 1 investigative priority by the Team will its public report immediately after not otherwise affect the authority of the conducting a preliminary [TD 9090] Team to continue its investigation under reconnaissance will issue a public RIN 1545–BC31 the Act. report not later than 90 days after (c) National Transportation Safety completion of the preliminary Limitation on Use of the Nonaccrual- Board. If the National Transportation reconnaissance. The public report will Experience Method of Accounting Safety Board is conducting an be in accordance with paragraph (a) of Under Section 448(d)(5); Correction investigation related to an investigation this section, but will be summary in of a Team, the National Transportation nature. AGENCY: Internal Revenue Service (IRS), Safety Board investigation will have (c) A Team that continues to conduct Treasury. priority over the Team investigation. an investigation after conducting a ACTION: Correction to temporary Such priority will not otherwise affect preliminary reconnaissance will issue a regulations. the authority of the Team to continue its public report not later than 90 days after investigation under the Act. completing the investigation in SUMMARY: This document contains (d) Although NIST will share any accordance with paragraph (a) of this corrections to temporary regulations evidence of criminal activity that it section. that were published in the Federal obtains in the course of an investigation Register on , 2003 (68 FR under the Act with the appropriate law § 270.206 Public briefings and requests for 52496) that revises temporary income enforcement agency, NIST will not information. tax regulations to providing guidance participate in the investigation of any (a) NIST will establish methods to regarding the use of a nonaccrual- potential criminal activity. provide updates to the public on its experience method of accounting by planning and progress of an taxpayers using an accrual method of § 270.202 Coordination with search and investigation. Methods may include: accounting and performing services. rescue efforts. (1) A public Web site; EFFECTIVE DATE: This correction is NIST will coordinate its investigation (2) Mailing lists, to include an effective September 4, 2003. with any search and rescue or search emphasis on e-mail; and recovery efforts being undertaken at (3) Semi-annual written progress FOR FURTHER INFORMATION CONTACT: the site of the building failure, including reports; Terrance McWhorter (202) 622–4970 local FEMA offices and local emergency (4) Media briefings; and (not a toll free number). response groups. Upon arrival at a (5) Public meetings. SUPPLEMENTARY INFORMATION:

VerDate jul<14>2003 14:44 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00013 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66708 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Background transmittal order. This document further to determine whether to remove, The temporary regulations that are the explains that FinCEN is revoking prior modify, or make permanent the subject of these corrections are under guidance regarding the meaning of the Exception. term ‘‘address’’, eliminating the need to section 448 of the Internal Revenue II. Terms of CIF Exception Code. utilize the conditional exception for transmittal orders lacking a transmittor’s FinCEN promulgated the Travel Rule Need for Correction street address. in 1995. The Travel Rule requires As published, this temporary DATES: Effective , 2003. financial institutions to include certain regulation (TD 9090) contain errors that FOR FURTHER INFORMATION CONTACT: Don information in transmittal orders may prove to be misleading and are in Carbaugh, Office of Regulatory relating to transmittals of funds of need of clarification. Programs, FinCEN, (202) 354–6400; and $3,000 or more, which must ‘‘travel’’ with the order throughout the funds Correction of Publication Al Zarate, Office of Chief Counsel, FinCEN, at (703) 905–3590 (not toll-free transmittal sequence. Among these Accordingly, the publication of numbers). requirements is that each transmittor’s temporary regulations (TD 9090), which SUPPLEMENTARY INFORMATION: financial institution and intermediary were the subject of FR Doc. 03–22458, financial institution include in a is corrected as follows: I. Background transmittal order the transmittor’s name 1. On page 52504, column 1, § 1.448– In 1998, FinCEN granted a conditional and address. See 31 CFR 103.33(g)(1)(i)– 2T(f)(c) T3Example 4, the sixth entry in exception (the Customer Information (ii) and (g)(2)(i)–(ii). Subsequently, the table is corrected to read as follows: File (CIF) Exception) to the strict financial institutions represented to operation of 31 CFR 103.33(g) (the FinCEN that their ability to comply with Total ac- Bad debts Travel Rule). See FinCEN Issuance the Travel Rule at all depended on their Taxable year counts re- adjusted for ability to use their automated customer ceivable recoveries 98–1, 63 FR 3640 (, 1998). The Travel Rule requires a financial information files, known as CIFs. ***** institution to include certain Although an originating institution 2002 ...... 90,000 16,800 information in transmittal orders always maintains the originating ***** relating to transmittals of funds of customer’s true name and address, the $3,000 or more. The CIF Exception CIFs were sometimes programmed with 2. On page 52504, column 1, § 1.448– addressed computer programming coded or nominee names and addresses 2T(f)(c), Example 4 (ii), third line, the problems in the banking and securities (or post office boxes). The language ‘‘Assume that $49,300 of the industries by relaxing the Travel Rule’s reprogramming tasks involved in total $80,000 of’’ is corrected to read requirement that a customer’s true name changing the CIFs were represented to ‘‘Assume that $49,300 of the total and address be included in a funds be a significant barrier to compliance $90,000 of’’. transmittal order, so long as alternate with the Travel Rule. In light of these burdens, and in the interest of obtaining Cynthia E. Grigsby, steps, described in FinCEN Issuance 98– 1 and designed to prevent avoidance of prompt compliance, FinCEN Acting Chief, Publications and Regulations promulgated the conditional exception. Branch, Legal Processing Division, Associate the Travel Rule, were satisfied. By its Chief Counsel, (Procedure and terms, the CIF Exception to the Travel The conditional exception provides Administration). Rule was to expire on , 1999; that a financial institution may satisfy [FR Doc. 03–29727 Filed 11–26–03; 8:45 am] however, in light of programming the requirements of 31 CFR 103.33(g) BILLING CODE 4830–01–P burdens associated with year 2000 that a customer’s true name and address compliance issues, FinCEN extended be included in a transmittal order, only the CIF Exception so that it would upon satisfaction of the following DEPARTMENT OF THE TREASURY expire on May 31, 2001. See FinCEN conditions: Issuance 99–1, 64 FR 41041 (, (1) The CIFs are not specifically 31 CFR Part 103 1999). On , 2001, after first altered for the particular transmittal of soliciting input from the law funds in question; Notice of Expiration of Conditional enforcement community for its views on (2) The CIFs are generally Exception to Bank Secrecy Act any law enforcement burdens caused by programmed and used by the institution Regulations Relating to Orders for the CIF Exception, FinCEN again for customer communications, not Transmittals of Funds by Financial extended the CIF Exception so that it simply for transmittal of funds Institutions would expire on May 31, 2003. See transactions, and are programmed to AGENCY: Financial Crimes Enforcement FinCEN Issuance 2001–1, 66 FR 32746 generate other than true name and street Network (FinCEN), Treasury. ( 18, 2001). On , 2003, address information; ACTION: Notice of expiration of FinCEN published a Notice of intent to (3) The institution itself knows and conditional exception following permit the CIF exception to expire on can associate the CIF information used extension. May 31, 2003. See 68 FR 10965 (Notice in the funds transmittal order with the of Intent). The Notice of Intent solicited true name and street address of the SUMMARY: FinCEN is giving notice that comment on a number of issues relating transmittor of the order; on , 2004, a conditional exception to the operation of the CIF Exception. (4) The transmittal order includes a to a Bank Secrecy Act (BSA) On , 2003, FinCEN published a question mark symbol immediately requirement will permanently expire. notice that again extended the CIF following any designation of the Upon expiration of that exception, Exception so that it would expire on transmittor other than by a true name on financial institutions will no longer be December 1, 2003. See FinCEN Issuance the order; able to comply with the terms of that 2003–1, 68 FR 26996. The purpose of (5) Any currency transaction report or BSA requirement by using coded this most recent extension was to allow suspicious activity report by the information or pseudonyms for the time for FinCEN to conduct a study on institution with respect to the funds name of a customer in a funds the operation of the CIF Exception, and transmittal contains the true name and

VerDate jul<14>2003 20:17 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00014 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66709

address information for the transmittor Based on its factfinding and input overwhelmingly outweighed by the and plainly associates the report with from the Subcommittee, FinCEN has potential harm resulting from an the particular funds transmittal in made the following determinations. intermediary or receiving financial question. First, there is a powerful law institution not being able to determine The conditional exception further enforcement interest, particularly in whether it has records related to a provides that it has no application to light of the tragic events of 9/11, in government target. Weighed against the any funds transmittals for whose ensuring that a financial institution can small number of clients for which the processing an institution does not identify funds transfers conducted by a CIF Exception is used, the law automatically rely on preprogrammed terrorist suspect listed in a subpoena or enforcement interests predominate. and prespecified CIF name and address other authorized search request. The use FinCEN wishes to clarify that, although information. FinCEN’s release of coded names and pseudonyms the Travel Rule does not permit the use promulgating the CIF Exception further effectively prevents an intermediary or of coded names or pseudonyms, the informed financial institutions that any a receiving financial institution from Rule does allow the use of abbreviated customer request for a nominee name in recognizing if it has records related to a names, names reflecting different a CIF should be carefully evaluated as government target. Second, to the extent accounts of a corporation (e.g., XYZ a potentially suspicious transaction. See that code names and pseudonyms are Payroll Account), as well as trade and 63 FR 3642. used in transmittal orders, such use assumed names of businesses (D/B/A) or III. Results of CIF Exception Study appears to be limited to select private the names of unincorporated divisions banking customers for confidentiality or departments of businesses. Since the issuance in May 2003 of the purposes. Because the use of coded FinCEN has reached a different Notice of Intent, FinCEN has studied the names and pseudonyms is so conclusion regarding the requirement to use of the CIF Exception by financial infrequent, there is not a substantial cost use a transmittor’s street address. The institutions, and the implications of involved in changing CIFs to reflect true term ‘‘address,’’ as it is used in 31 continuing the CIF exception for law names. Lastly, FinCEN understands that U.S.C. 103.33(g), is not defined. FinCEN enforcement investigations. The staff of mailing addresses, rather than street has previously issued guidance that has the Federal Reserve Bank of New York addresses, are widely used by financial been interpreted as not allowing the use assisted in this process by providing institutions in their CIFs. The banking of mailing addresses, including post FinCEN with a sample of funds transfer industry contends that changing CIFs to office boxes, in situations in which a activity using the Fedwire system, reflect street addresses would require street address is known to the which gave FinCEN a one-day snapshot banks to examine each address in a CIF, transmittor’s financial institution.3 of the frequency and type of use of the and compare it with other customer Because the use of the conditional CIF Exception. FinCEN also obtained information maintained by the bank, to exception for mailing addresses arises the views of law enforcement officials determine whether the CIF address was and financial institutions on this issue. from a prior interpretation, rather than a mailing address or street address. In the explicit language of section Ultimately, FinCEN formed a addition, a new field would have to be Subcommittee of the Bank Secrecy Act 103.33(g) itself, FinCEN believes this created in the CIF to accommodate issue is more appropriately addressed Advisory Group (BSAAG)1 to advise street address information, because FinCEN on the costs and benefits of through a regulatory interpretation, customers would still want their rather than through a temporary maintaining, terminating, or modifying statements and other information sent to the Exception. The Subcommittee exception. their mailing address. Finally, each FinCEN believes that the Travel Rule, consists of officials representing program that links the CIF to each of the FinCEN, the U.S. Department of the like all Bank Secrecy Act rules, should bank’s systems would have to be revised be read with some flexibility so as to Treasury, the U.S. Department of so that the correct address would be Justice, the federal bank and securities avoid the unnecessary burdening of used for each application. According to financial institutions. After weighing regulators, the banking industry, and the the banking industry, each of these steps securities industry. FinCEN presented the competing interests involved in would have to be accomplished largely whether to require street address the Subcommittee with the results of its on a manual basis, resulting in information FinCEN has determined factfinding and the Subcommittee also significant costs to financial that the Travel Rule should be read to reviewed information provided by the institutions. Law enforcement has allow the use of mailing addresses. New York Clearing House Association acknowledged that the conduct of a 2 Consequently, for purposes of 31 CFR L.L.C. reliable search is more dependent upon 103.33(g), the term address means either the use of true names than it is upon the 1 the transmittor’s street address, or the The BSAAG is an advisory group consisting of use of street addresses. representatives of government, financial transmittor’s address maintained in the Based upon these findings, and after institutions, and other interested persons. The financial institution’s automated weighing the competing interests BSAAG meets semiannually for the purpose of customer information file so long as the informing private sector representatives of the involved, FinCEN has determined that institution maintains the transmittor’s utility of Bank Secrecy Act reports and to advise the revocation of the CIF Exception is Secretary of the Treasury (or his designee) of address on file and such address appropriate. Regarding true name potential enhancements or modifications to existing information is retrievable upon request information, whatever legitimate Bank Secrecy Act requirements. by law enforcement.4 Under no 2 See Letter from Clearing House to Director James interest is served by the use of coded F. Sloan, FinCEN, , 2003. The members names or pseudonyms in shielding the of the Clearing House are: Bank of America, 3 See Clearing House Letter (citing FinCEN National Association; The Bank of New York; Bank identity of a few select clients is Advisory Issue 3, Funds Transfers: Questions and One, National Association; Citibank, N.A.; Deutsche Answers, June 1996 (Q&A no. 18). Bank Trust Company Americas; Fleet National the positions taken in the October 20 letter: 4 Consistent with the final rules issued under Bank; HSBC Bank USA; JPMorgan Chase Bank; American Express Bank, Ltd.; The Bank of Tokyo- section 326 of the USA Patriot Act (Pub. L. 107– LaSalle Bank National Association; Wachovia Bank, Mitsubishi, Ltd., New York Branch; and UBS AG, 56), an ‘‘address’’ for purposes of the Travel Rule, National Association; and Wells Fargo Bank, Stamford Branch. In addition, the American for an individual, is a residential or business street National Association. The following members of Banker’s Association participated in the drafting of address, or an Army Post Office Box or a Fleet Post The Clearing House’s affiliate, The Clearing House the October 20 letter and supports the views Office Box, or the residential or business street Interbank Payments Company L.L.C, also support expressed in it. Continued

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00015 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66710 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

circumstances may a financial Dated: November 21, 2003. Printing Office. The Web site address is institution use its own address or William F. Baity, http://www.access.gpo.gov/nara/ another financial institution’s address in Acting Director, Financial Crimes index.html. place of the customer’s address, Enforcement Network. I. Background notwithstanding any prior guidance that [FR Doc. 03–29617 Filed 11–26–03; 8:45 am] appeared to allow the use of a financial BILLING CODE 4810–02–P Section 4454 of the Balanced Budget institution’s address under limited Act of 1997 (BBA ’97), (Pub. L. 105–33, circumstances.5 To avoid any confusion enacted , 1997) provides for on the issue of addresses in transmittal DEPARTMENT OF HEALTH AND removal of all statutory and regulatory orders, FinCEN, by this notice, hereby HUMAN SERVICES references to Christian Science revokes Q&A no. 18 contained in sanatoria, and for coverage and payment FinCEN Advisory Issue 3 (June 1996) Centers for Medicare and Medicaid of inpatient hospital services and post- and Q&A no.16 contained in FinCEN Services hospital extended care services Advisory Issue 7 (January 1997). furnished in qualified religious FinCEN anticipates issuing a new set of 42 CFR Parts 403, 489 and 498 nonmedical health care institutions frequently asked questions and answers [CMS–1909–F] (RNHCIs) under Medicare and as a State regarding the application of the funds Plan option under Medicaid. (We will transfer rules very shortly. Nothing in RIN 0938–AI93 refer to these services as ‘‘RNHCI this notice affects the obligation of a Medicare and Medicaid Programs; services.’’) The new amendments make financial institution to comply with any it possible for institutions other than other requirement imposed under the Religious Nonmedical Health Care Institutions and Advance Directives Christian Science facilities to qualify as Bank Secrecy Act, including a customer RNHCIs and to participate in Medicare identification program requirement AGENCY: Centers for Medicare and and Medicaid. imposed under Section 326 of the USA Medicaid Services (CMS), HHS. On , 1999, we published Patriot Act. ACTION: Final rule. an interim final rule in the Federal Finally, to give financial institutions Register (67 FR 67028) to implement the the opportunity to take those steps SUMMARY: This final rule implements BBA ’97 amendments that set forth the necessary to comply fully with the requirements under the Balanced requirements for coverage and payment Travel Rule, this Notice extends the Budget Act of 1997, which set forth for services furnished by RNHCIs, and conditional exception through July 1, requirements for the new Religious modified the rules regarding advance 2004. Nonmedical Health Care Institution directives. program and advance directives. This IV. FinCEN Issuance rule finalizes the Medicare requirements Specifically, the interim final rule for coverage and payment of services presented the methodologies under By virtue of the authority contained in furnished by religious nonmedical which we will pay RNHCIs, monitor the 31 CFR 103.55(a) and (b), which has health care institutions, the conditions Medicare expenditure level for RNHCI been delegated to the Director of of participation that these institutions secular services for any given federal FinCEN, the effective period of the CIF must meet before they can participate in fiscal year (FFY), and implement a Exception, as such Exception is set forth Medicare, and the methodology we will statutory ‘‘sunset’’ of the RNHCI benefit. (as part of FinCEN Issuance 98–1, 63 FR use to pay these institutions and In addition, the rule set forth the 3640 (, 1998)) under the monitor expenditures for services they conditions of participation that an heading ‘‘Grant of Exceptions’’ (63 FR furnish. This rule also finalizes the rules RNHCI must fully meet to participate in 3641) is extended so that CIF Exception governing States’ optional coverage of the Medicare program and revised will expire on July 1, 2004, for religious nonmedical health care Medicaid regulations to reflect statutory transmittals of funds initiated after that institution services under the Medicaid changes and made necessary date. program. Additionally, this final rule nomenclature and conforming changes. addresses comments we received on the Finally, the rule revised the regulations address of next of kin or another contact individual November 30, 1999, interim final rule pertaining to advance directives for all for individuals who do not have a residential or providers. business address. For a person other than an and also makes minor changes to clarify individual (such as a corporation, partnership, or our policy. Lastly, this rule incorporates II. Provisions of the Interim Final Rule trust), ‘‘address’’ is a principal place of business, a minor change to the requirements for local office, or other physical location. See 68 FR advance directives. Below we provide a brief summary of 25090 (, 2003) (Final Rules for Customer Identification Programs) issued jointly with the DATES: Effective date: These regulations the provisions we implemented in the Board of Governors of the Federal Reserve System, are effective December 29, 2003. November 30, 1999, interim final rule to Office of the Comptroller of the Currency, Office of comply with requirements set forth by FOR FURTHER INFORMATION CONTACT: Thrift Supervision, Federal Deposit Insurance section 4454 of BBA ’97. Corporation, National Credit Union Administration, Jean-Marie Moore, (410) 786–3508 (for Commodity Futures Trading Commission, and general information, Medicare A. RNHCI Medicare Benefits, Conditions Securities and Exchange Commission. Note, however, that while the Section 326 rules apply coverage, and payment issues); of Participation, and Payment Nancy Archer, (410) 786–0596 (for only to new customers opening accounts on or after 1. Basis and Purpose (§ 403.700) , 2003, and exempt wire transfers from the Medicare conditions of participation definition of ‘‘account’’ for banks, the Travel Rule issues); and Linda Tavener, (410) applies to all transmittals of funds of $3,000 or This subpart implemented sections more, whether or not the transmittor is a customer 786–3838 (for Medicaid issues). 1821; 1861(e), (y) and (ss); 1869; and for purposes of the Section 326 rules. SUPPLEMENTARY INFORMATION: 1878 of the Social Security Act (the Act) 5 See FinCEN Advisory Issue 7, Funds ‘‘Travel’’ Copies: This Federal Register regarding Medicare payment for Regulations: Questions & Answers, January 1997 (Q&A no. 16) (stating that a financial institution document is available from the Federal inpatient hospital or post-hospital must not use its own address ‘‘except where it is Register online database through GPO extended care services furnished to the actual address of record of the person’’). access, a service of the U.S. Government eligible beneficiaries in RNHCIs.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66711

2. Definitions and Terms (§ 403.702) discussed the limitations that apply to section 1821(c)(2)(C) of the Act as the Under this section, we included subsequent elections. ‘‘unadjusted trigger level’’ for an FFY, adjusted using the consumer price index definitions for terms or acronyms used 5. Conditions of Participation to the last 12 months ending July of the in the rule. Those terms that were Under section 1861(ss)(1)(J) of the defined elsewhere within the text of the prior FFY, and increased or decreased Act, we may accept an RNHCI as a by the carry forward from the previous rule were not included under this participating Medicare provider only if, FFY. In the interim final rule, we section. in addition to meeting the specific provided descriptions and examples of 3. Conditions for Coverage (§ 403.720) requirements of that section, it meets the trigger level calculation, the carry other requirements we find necessary in forward calculation, estimated Under this section, we specified the the interest of patient health and safety. 10 qualifying provisions as contained in expenditures, and adjustments in With the broad authority the Act gave us payments to help explain the statutory section 1861(ss)(1) of the Act that a to impose these requirements, we set Medicare or Medicaid provider must provision (64 FR 67036). forth those conditions we found to be Section 1821(c)(2)(A) of the Act satisfy to meet the definition of an appropriate and necessary in the provides for a proportional reduction in RNHCI. While the requirements religious nonmedical setting that an payments for covered RNHCI services contained in sections 1861(ss)(1)(B) RNHCI must meet to participate in the when the level of estimated (lawful operation), (G) (ownership by or Medicare program. We set forth expenditures exceeds the trigger level in a provider of medical services), and conditions of participation regarding for any FFY. In addition to a (H) (utilization review) of the Act were patient rights (§ 403.730); quality proportional reduction in payments, explicitly addressed in the Medicare assessment and performance section 1821(c)(2)(B) of the Act Conditions of Participation before improvement (§ 403.732); food services authorizes us to impose other passage of the BBA ’97, it is essential (§ 403.734); discharge planning conditions or limitations to keep that a facility meet all 10 elements to (§ 403.736); administration (§ 403.738); Medicare expenditure levels below the qualify as an RNHCI for both the staffing (§ 403.740); physical trigger level. The statute provides us Medicare and Medicaid programs. environment (§ 403.742); life safety from with authority to decide which type of In addition to meeting the definition fire (§ 403.744); and utilization review adjustment to apply but is silent about of an RNHCI, the facility must also meet (UR) (§ 403.746). when to apply a proportional conditions of coverage for RNHCI Life Safety from Fire. In the interim adjustment or when to apply alternative services as established under section final rule we required that an RNHCI adjustments. Therefore, we have 1821 of the Act. Specifically, section comply with the 1997 edition of the extremely broad authority to decide 1821(a) of the Act requires that as a National Fire Protection Association what type of adjustments to impose. condition for Part A Medicare coverage, (NFPA) Life Safety Code that we The regulations at § 403.750 the beneficiary must have a condition incorporated by reference. We discuss implement the statute and provide for that would qualify under Medicare Part the update to the Life Safety Code later imposing either a proportional A for inpatient hospital services or in this rule. adjustment to payments or alternative extended care services furnished in a Utilization Review. This was the only adjustments, depending on the hospital or skilled nursing facility that condition of participation specifically magnitude of the adjustment required to is not an RNHCI. The beneficiary must required by statute. Section keep the level of estimated expenditures also have a valid election in effect to 1861(ss)(1)(H) of the Act requires that an from exceeding the trigger level. To receive RNHCI services. RNHCI have in effect a UR plan that account for any error in the estimation The RNHCI may not accept a patient includes the establishment of a UR of expenditure levels, the trigger level as a Medicare or Medicaid beneficiary committee to carry out the functions of for the next FFY is adjusted by the after the sunset provision (§ 403.756) is the program. ‘‘carry forward.’’ If expenditures were to implemented, unless the patient has an exceed the trigger level, the trigger level election in effect before of the 6. Estimate of Expenditures and for the subsequent year must be year in which the sunset provision is Adjustments (§ 403.750) decreased, resulting in more drastic implemented. A claim filed for payment Section 1821(c)(1) of the Act requires payment adjustments in future years. for services furnished to a patient with us to estimate the level of Medicare We will do this in an attempt to prevent no valid election in effect before January expenditures for RNHCI benefits before expenditures from exceeding the trigger 1 of the year the sunset provision is the beginning of each Federal fiscal year level for 3 consecutive years and thus implemented would be denied. We (FFY) and requires us to monitor the avoid having to implement the sunset explain the circumstances in which the expenditure level for RNHCI services provision. sunset provision would be triggered at provided in each FFY. The estimation of § 403.750 of the regulations. expenditure levels is necessary to 7. Payment Provisions (§ 403.752) determine if adjustments are required to Payment to RNHCIs. Sections 1861(e) 4. Valid Election Requirements limit payments to RNHCIs in the and (y)(1) of the Act grant us broad (§ 403.724) following FFY. In addition, the estimate authority to construct a payment Under this section, we implemented is used to determine if the sunset methodology for RNHCIs. We specified section 1821(b) of the Act to address the provision is implemented. that we would continue to pay RNHCIs issues involved in beneficiary election As required by section 1861(e) of the under the same reasonable cost of RNHCI services. We specified the Act, we will issue an annual Report to methodology we used for Christian general requirements relating to the Congress, reviewed by the Office of Science sanatoria. We pay RNHCIs the election and the election process as well Management and Budget, as the vehicle reasonable cost of furnishing covered as the written statements that must be for reporting the potential need to make services to Medicare beneficiaries included in the election form. In adjustments in payments and proposed subject to the rate of increase limits in addition, we described the mechanisms to be employed in order to accordance with the provisions in 42 circumstances under which the election stay within the established expenditure CFR 413.40, which implement section would be revoked. Finally, we ‘‘trigger level’’ which is defined in 101 of the Tax Equity and Fiscal

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66712 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Responsibility Act of 1982 (TEFRA) beginning FFY 2002, if the level of amended the regulations at § 488.2 to (Pub. L. 97–248). estimated expenditures for all RNHCIs add section 1861(ss)(2) of the Act as the We added that we intended to exceeds the trigger level for 3 statutory basis for accreditation of continue paying all RNHCIs under a consecutive FFYs, we would not accept RNHCIs and § 488.6 to add the RNHCIs reasonable cost, subject to the rate of any Medicare claims for payment for to the list of providers in this section. increase limit methodology, until we any election executed on or after identify an appropriate prospective January 1 of the following calendar year. D. Part 489, Subpart I—Advance payment methodology to meet the We also specified in the interim final Directives special requirements for this provider rule that we would publish a notice in Section 4641 of the BBA ’97 required group. In the interim final rule, we the Federal Register at least 60 days that (for all providers entering into a removed and reserved § 412.90(c) and before the effective date of the sunset provider agreement with CMS) an § 412.98 for the RNHCI prospective provision to alert the public that no individual’s advance directive be placed payment. elections will be accepted for services in in a ‘‘prominent part’’ of his or her Administrative and Judicial Review. an RNHCI. medical record. As this was such a Under section 1821(c)(2)(D) of the Act, B. Medicaid Provisions (§ 440.170) minor change to our requirements at there is no administrative or judicial section 489, we requested that this Services in RNHCIs are optional review of our estimates of the level of change be appended to the RNHCI Medicaid services that a State may elect expenditures for RNHCI services or the regulation, thereby avoiding a separate application of the adjustment in to include in its title XIX State plan in accordance with section 1905(a)(27) of rulemaking process. Therefore, in the payments for those services. We November 30, 1999 final rule, we added incorporated this provision into our the Act. This section permits the inclusion of any other medical care and ‘‘prominent part’’ to § 489.102(a)(2) to regulations. reflect this requirement. That is, Beneficiary Liability. Under the new any other type of remedial care providers are required to document an regulations, RNHCIs are subject to recognized under State law, specified by advance directive in a prominent part of Medicare rules for deductibles and CMS. Federal financial participation is the individual’s current medical record. coinsurance. Under normal Medicare only available to a State for these rules, a provider of services may only services if they are included in the State III. Analysis of and Responses to bill a beneficiary deductible and Plan. Comments coinsurance amounts. However, section Section 4454(b) of the BBA ’97 1821(c)(2)(E) of the Act authorizes provides for coverage of a religious We received a total of three items of RNHCIs to bill individuals an amount nonmedical health care institution as correspondence on the interim final rule equal to the reduction in payments defined in section 1861(ss)(1) of the Act. with comment published on November applied under sections 1821(c)(2)(A) or Specific ownership and affiliation 30, 1999. The comment response on the (B) of the Act. We implemented this requirements related to RNHCIs are interim final rule was very limited, and provision specifying that when described in section 1861(ss)(4) of the there were no similarities in issues payments are reduced to prevent Act. We therefore revised § 440.170(c), raised by the commenters. We received estimated expenditures from exceeding ‘‘Services in Christian Science comments from a fire safety association; the trigger level, the RNHCI may bill the sanitoriums,’’ to accommodate the new a pediatric medical association; and a beneficiary the amount of the Medicare RNHCI program. Additionally, an national religious organization that is reduction attributable to his or her RNHCI as defined in section 1861(ss)(1) oriented to healing by prayer. Each covered services. In addition, we set of the Act furnishes exclusively commenter approached the final rule in forth the requirements an RNHCI must inpatient services. Consequently, we a manner that reflected the views of his follow regarding notifying a beneficiary revised § 440.170(b), ‘‘Services of or her particular organization. The of any current or proposed Medicare Christian Science nurses,’’ since it dealt major issues that commenters raised adjustments. with Christian Science and care in the included the following: home setting. We revised language at • A prohibition on the admission of 8. Monitoring Expenditure Level § 440.170(b), to define an RNHCI for children to an RNHCI. (§ 403.754) Medicaid coverage purposes as one that • Incorporation of a specific version Under this section, we implemented meets the requirements of section of the fire safety code in the rule. section 1821(c)(3)(A) of the Act that 1861(ss)(1) of the Act, and § 440.170(c), requires us to monitor the expenditure to describe the specific ownership and • Modification of the requirements to level of RNHCIs beginning with FFY affiliation requirements applicable to correspond to the beliefs of a specific 1999 which allows us to calculate the Medicaid RNHCIs. In addition, we religious group. carry forward. specified in the interim final rule that • Modification of the requirements RNHCIs are required to meet the 9. Sunset Provision (§ 403.756) related to the election process and the Medicare conditions of participation related coverage of services. Section 1821(d) of the Act contains described in part 403 of this rule in • Modification of the prohibition on the RNHCI sunset provision. This order to be eligible to receive payment the use of restraints. provision, when activated, will prevent under Medicaid, rather than developing beneficiaries from making elections to separate Medicaid requirements. We are not making any changes in the receive Medicare payment for religious regulation as a result of the three nonmedical health care services after a C. Part 488 Survey, Certification, and comments we received, although we certain date. The sunset provision will Enforcement Procedures note that one change, regarding the Life be activated when the level of estimated Section 1861(ss)(2) of the Act Safety Code, was made in a separate expenditures exceeds the trigger level provides that we may accept the rule on , 2003, with an for three consecutive FFYs. accreditation of an approved group that effective date of , 2003 (68 FR In accordance with this statutory RNHCIs meet or exceed some or all of 1374). We summarized the issues raised provision, we specified in our the applicable Medicare requirements. by each commenter and have provided regulations under this section that Therefore, in the interim final rule, we our responses below.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66713

A. Pediatric Medical Association The commenter argued that our current noted that Medicare does not cover definition, ‘‘health care furnished under these services and that they are the Sections 403.702, 403.730, and 440.170 established religious tenets that financial responsibility of the Comment: One commenter suggested prohibited conventional or individual. amending the conditions of unconventional medical care for the The use of the term ‘‘religious tenet’’ participation explicitly to prohibit treatment of a beneficiary, and the sole is considered appropriate to cover the RNHCIs from providing care to any reliance on these religious tenets,’’ if basic beliefs of any religious group that child, regardless of whether the interpreted literally, could actually is seeking participation in the RNHCI individual is seeking payment under prohibit religious nonmedical nursing program. While the use of the term is Medicare or Medicaid for that care. The facilities from qualifying as RNHCIs that not prescribed by the statute, the comment is based on the statutory the Congress clearly intended to be development of regulations does language that authorizes the Secretary to qualified. provide the opportunity to use other establish standards to ensure the health The commenter indicated that their language and the term ‘‘religious tenets’’ and safety of patients choosing to method of healing did not include the is consistent with the Act. Federal courts have repeatedly upheld the receive care in RNHCIs. The commenter use of conventional or unconventional care and that the teachings of this constitutionality of these provisions. believes that it is impossible to ensure Church did not expressly ‘‘prohibit’’ the See, for example, Kong v. Min De Parle, the health and safety of children who choice of medical treatment. The No. C 00–4285 CRB, 2001 WL 1464549 are patients in an RNHCI because the commenter stated that the choice of (N.D.Cal. Nov. 13, 2001) (upholding patient is isolated from persons treatment rested with the individual, constitutionality of section 4454 of the competent or willing to assess the need but an individual would not be BBA); see also Children’s Healthcare is and appropriately secure medical care practicing his or her religion while a Legal Duty, Inc. v. Min De Parle, 212 when the care is necessary to preserve receiving medical care. The commenter F.3d 1084 (8th Cir. 2000), cert. den., 532 the child’s life or health. The further stated that this is why practicing U.S. 957, 121 S.Ct. 1483 (2001) (same). commenter added that the Secretary has members of the group, relying entirely We are making no changes to the terms the authority to prohibit RNHCIs from on spiritual means for healing, required ‘‘religious nonmedical care’’ or providing services to children and accommodation in order to participate ‘‘religious method of healing.’’ should do so. in Medicare. The commenter indicated Comment: The commenter suggested Response: We do not have the that many members of their group that we provide a more flexible authority to exclude any patients, engaged in a number of practices that definition of ‘‘religious nonmedical including children, from admission to involved neither the acceptance of nursing personnel’’ to provide the an RNHCI. Nevertheless, our data medical treatment nor reliance on RNHCI more latitude in hiring outside indicate that no children have sought religious ‘‘tenets’’ but were undertaken their religious denomination, if they so RNHCI services as program beneficiaries in the interest of practicing good care of choose. The commenter indicates that thus far. The reason for this situation is their ‘‘health.’’ The commenter sought constitutional issues may be raised by that, in at least some instances, children more flexibility for a beneficiary to the requirement that nursing personnel must undergo some type of medical select some forms of health care that are ‘‘be grounded in the religious beliefs of examination before they can obtain nonintrusive such as visiting dentists the RNHCI.’’ The commenter stated that benefits under Medicare and Medicaid. for oral hygiene; visiting an optometrist the Act only requires personnel to be For example, a child can only receive or wearing eyeglasses; or being fitted for ‘‘experienced in caring for the physical Medicare benefits if he or she has or wearing a mechanical hearing aid. needs of these patients.’’ undergone a medical physical Additionally, the commenter Additionally the commenter would examination and as a result was expressed that the definition of appreciate it if the regulations could determined to meet Social Security ‘‘religious nonmedical care or religious clearly state that nursing personnel who criteria for disability. Such an method of healing’’ was neither required are less experienced, such as trainees, examination is inconsistent with by nor consistent with the Act, and that may provide service to patients under opposition to receipt of traditional Constitutional issues have been raised the supervision of those who are medical care. For these reasons, we regarding the use of the term ‘‘formally recognized as competent in believe few if any children will be ‘‘established religious tenets.’’ the administration of care within their admitted to RNHCIs as Medicare or Response: Both the statute and the religious nonmedical health care Medicaid beneficiaries. Therefore, we related legislative history demonstrate a group.’’ The commenter assumed that will not revise the conditions of clear congressional intent to establish the regulations did not prohibit RNHCIs participation as the commenter this benefit for those who for religious from allowing trainees to provide suggested. reasons are conscientiously opposed to service to patients when supervised by acceptance of medical care and to experienced personnel but requested B. Religious Nonmedical Organization provide parameters for nonexcepted that we provide clarification in the Definitions and Terms—§ 403.702 medical treatment. Since both the law regulation. and the congressional deliberations are Response: Medical model health care Comment: The commenter requested clear on the issue, the rule must follow settings use registered nurses or that the definition for ‘‘religious the statutory intent and provide a licensed practical nurses that have nonmedical care or religious method of framework for all religious groups that participated in educational programs healing’’ be removed or revised as may use the benefit. The rule must be and following graduation take follows: applicable to all in the intended benefit standardized tests for licensure. The group, not to just a sector of the statute requires that for payment Religious nonmedical care or religious method of healing’’ means health care potential beneficiaries. With regard to a purposes a beneficiary would require furnished in accordance with a religious beneficiary’s choice or need to receive hospital or skilled nursing facility care belief or doctrine with which the acceptance such services as oral hygiene visits, in order to qualify for admission to an of conventional or unconventional medical optometry visits or eyeglasses, or testing RNHCI. In turn, by statute the RNHCI care by a beneficiary would be inconsistent. and fitting for hearing aids, it should be may provide only nonmedical nursing

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00019 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66714 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

items and services to patients, which is periods when the business office is not that the program will pay for the service contrary to conventional nursing open, such as evenings, nights, under the statute. It is the payment for practice. Currently the only weekends, and holidays. that Medicare claim that actually standardization for RNHCI nurse Response: Since we consider triggers the revocation of the RNHCI credentials exists for those individuals obtaining notary authority for election and (if applicable) the start of prepared in religious group nurse individual staff members to be a the waiting period that determines training programs and involved in the relatively straightforward process, there when a new RNHCI election may be practice of that religion. can be several notaries in a facility to filed. The phrase ‘‘grounded in the religious meet beneficiary needs when the beliefs’’ of an RNHCI is not intended to business office is not open. Condition of Participation: Patient mean that religious nonmedical nursing Additionally, the RNHCI can establish Rights § 403.730(c)(4) personnel must ‘‘accept or practice’’ a relationships with notaries within the Comment: The commenter requested particular religious belief. The phrase community to provide assistance in that the utilization review committee ‘‘grounded in the religious beliefs’’ emergency situations. Therefore, we are have the power to authorize the limited means that nonmedical nursing retaining the election policy as use of restraints when the patient poses personnel must be appropriately established in the interim final rule. a danger to self, other patients, or staff. familiar with the culture and religious Comment: The commenter suggested The commenter indicated that since the beliefs of the RNHCI to care for the that care be covered without an election UR committee could make an initial physical needs of patients. under certain limited circumstances. determination for coverage under For purposes of writing the rule, it The commenter requested a grace period Medicare and Medicaid, it could also be was necessary to choose those of at least 72 hours to provide care for capable of determining if and when requirements that would provide a level a patient in distress, or to locate a legal those rare occasions existed when there of standardization for providing representative or have one appointed in would be a need to protect the safety of nonmedical nursing care to the case of admitting an unresponsive or a patient and the staff. Additionally, the beneficiaries. We are retaining the incompetent Medicare beneficiary, commenter stated that it would be definition of religious nonmedical before fully executing the election for appropriate to place specific nursing personnel as set forth in the RNHCI care. requirements on the use of restraints, interim final rule. Response: We do not believe we have such as— Similar to other provider types, the the authority for the requested grace • Choosing the least restrictive issue of nurse trainees was not period. The statute requires a valid manner for the least amount of time as addressed in the rule. The per-diem rate election to be in place for RNHCI possible; includes payment for RNHCI nurses services to be covered and paid for. • Placing time limits for using responsible for the care of beneficiaries, Delaying the election process is of restraints without additional review by and they may also supervise those concern particularly for an individual in the UR committee; aspects of care provided by trainees. distress and unable to make his or her • Not permitting standing orders for While trainees can provide care under personal wishes known. the use of restraints; the supervision of an RNHCI nurse, any Comment: The commenter • Using restraints only when cost or payment attributed to the trainee recommended that an election be absolutely necessary and other is not to be considered a component of effective retroactively for care provided interventions have been ineffective; and • the Medicare or Medicaid per diem rate. up to 72 hours before the election is Requiring RNHCI staff to frequently Comment: The commenter suggested signed. If the patient expires before the check on the restrained patient. that we expand the term ‘‘legal execution of a valid election, the Response: Section 1866(ss)(1) of the representative’’ that is included in the commenter requested that Medicare pay Act and the related legislative history definition of ‘‘election’’ to include for the care provided by the RNHCI to underscore the centrality of nonmedical someone acting under a valid health the beneficiary. interventions to the care provided by care durable power of attorney or an Response: We do not believe we have RNHCIs. The statute requires active equivalent instrument. the authority to accommodate the patient choice and limits the benefit to Response: The term ‘‘legal requested pre-election coverage period. those for whom the ‘‘acceptance of representative’’ as used in the definition medical health services would be of ‘‘election’’ is considered appropriate Election Revocation § 403.724(a)(1)(iii) inconsistent with their religious to safeguard the interest of the Comment: The commenter indicated beliefs.’’ Under this model, chemical beneficiary, and we are not making any an inconsistency between section restraints (drugs) would clearly be revisions. The designation of a legal 1821(b)(3) of the Act and antithetical, as well against the statute. representative is a serious responsibility § 403.724(a)(1)(iii) of the regulation, On the other hand, ‘‘assistive devices’’ that should follow accepted legal regarding payment being received (such as crutches, canes, and walkers, protocols and therefore does not require versus payment being requested. The etc.), used only on a voluntary basis by further definition in the rule. In this commenter believes that the election the patient, would not constitute a matter, we generally defer to the States should be revoked only if Medicare ‘‘restraint.’’ We currently define in deciding who qualifies as a ‘‘legal makes payment rather than when ‘‘physical restraint’’ in our hospital representative’’ since State law governs Medicare medical care is merely sought. condition of participation at § 482.13 as these questions. Response: Section 403.724(a)(1)(iii) of ‘‘any manual method or physical or our regulations implements section mechanical device, material, or Elections and Revocations § 403.724 1821(b)(3) of the Act, which set forth the equipment attached or adjacent to the Comment: The commenter suggested information that must be included in patient’s body that he or she cannot that for practical purposes an election the election form. This section specifies easily remove [and] that restricts be considered valid without that receipt of nonexcepted medical freedom of movement or normal access notarization under certain services constitutes a revocation of an to one’s body.’’ In thinking about circumstances. The commenter election. Seeking Medicare medical care whether a device or practice may be requested a grace period to cover those indicates that a beneficiary anticipates considered a restraint, the RNHCI

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66715

should consider how the device or religious beliefs observed by the mean that a medical prognosis is being practice affects the patient. For example, institution or its personnel.’’ The made. The requirement is not that a if a patient were in a wheelchair with commenter considered the prognosis be made but rather that the a belt, the belt would not be considered recommended dietary allowances of the discharge process be started early on a restraint if the patient can National Academy of Sciences to be a during a stay, and not only when independently unsnap the belt. The key medical model that involved learning discharge is imminent. The RNCHI is is to assess each patient and each the chemistry of food and determining also responsible for identifying the situation to determine how a device or the patient’s body weight and height. As qualified and experienced person for practice will affect the patient. If the the basis for their objection, the developing or supervising a discharge belt described above were snapped in commenter cited section plan. If a patient may need additional the back so that the patient could not 1861(ss)(3)(B)(i) of the Act, which services after discharge from the RNCHI, reach it to release it, it would be species that the Secretary shall not a plan must be in place to ensure that considered a restraint. (See previous subject a religious nonmedical health those services will be available in the discussion in the preamble of the care institution or its personnel to any community or another facility. interim final at 64 FR 67032.) medical supervision, regulations, or Condition of Participation: Utilization Current professional standards of control, insofar as such supervision, Review (UR) § 403.746(a)&(b) practice and guidelines advocate for regulation, or control would be contrary minimal use of physical restraints, in to the religious beliefs observed by the Comment: The commenter objected to limited medical circumstances. The institution or those personnel. the requirement of having a UR plan Medicare and Medicaid programs have Response: Our first priority is to that must contain written procedures for very strict criteria for the use of physical patient health and safety. We appreciate evaluating the duration of care and the restraints in other provider types, such the commenter’s suggestion, but we need for continuing care of an extended as hospitals and nursing homes, that disagree with the suggested provision. duration. The commenter believes that require both medical supervision and We do not believe that this requirement the requirement leads to speculation intensive ‘‘medical * * * examination, violates section 1861(ss)(3)(B)(i) of the about the duration of a patient’s illness diagnosis, prognosis [and] treatment’’ of Act because the requirement is designed and requires nurses to make a prognosis, the patient in order to assure that the to meet general physical health needs which is contrary to the nursing practice minimum appropriate restraint is used. unrelated to medical treatment for any of the religious group. The commenter While it would seem that rare occasions illness, injury, or condition. Because requested that we revise the standard could arise where (physical) restraints therapeutic diets or parenteral nutrition under § 403.746(a) to include a could be used to protect the safety of a are not expected to be ordered for the disclaimer in favor of their beliefs. patient or staff, we believe that this population of patients in these facilities, Response: We are not suggesting that restraint use, without medical review we are not suggesting that nurses RNHCI nurses practice outside of their poses too great a hazard. Since the perform duties outside the scope of their scope of practice or religious beliefs. We RNHCI statute expressly prohibits these religious beliefs. The requirements in are requiring, however, that the RNCHI facilities from engaging in ‘‘medical the rule are not medical in nature, but provide, through procedures written in * * * examination, diagnosis, prognosis rather guidance for the maintenance of their UR plan, the patient’s initial need [and] treatment,’’ the use of restraints is health within the general population. and appropriateness of an RNHCI stay not within their purview. and justifications for extending that We disagree that the utilization Condition of Participation: Discharge stay. The UR condition of coverage and review committees in the RNHCIs could Planning § 403.736(a)(1) condition of participation are statutory, provide an adequate oversight function Comment: One commenter requested and we do not believe we have authority for the use of physical restraints. While that, following the first sentence of the to alter those conditions. the UR committees are the body discharge planning evaluation standard Comment: The commenter requested responsible for ascertaining the at § 403.736(a) that states the RNCHI that we remove the requirement that the appropriateness of Medicare (or must assess the need for a discharge governing body be included on the UR Medicaid) covered services for an plan for patients likely to suffer adverse committee. The commenter stated that individual, they do not have the consequences if there is no plan and for the governing bodies of most Christian medical expertise necessary to assure patients upon request or at the request Science facilities are made up of that physical restraints could be of their legal representative, we add the Christian Scientists from the large provided to Medicare or Medicaid following language, ‘‘provided that this geographical area served by the facility beneficiaries safely. planning process shall not require and are not involved in the daily actions which would be contrary to the administration of the facility. Many do Condition of Participation: Food Service religious beliefs observed by the not live close enough to the facility to § 403.734(b) institution or its personnel.’’ The permit review of admissions or Comment: The commenter requested commenter believes that the decisions on a daily basis. Additionally, that we add the language to our requirement to initiate discharge they do not possess the skills or standard regarding requirements for the planning on admission requires the experience required to make appropriate meal served to the patient in the RNHCI nurse to make a prognosis. Again, the UR decisions. The commenter suggested at § 403.734(b). The commenter believes commenter cited section that the UR committee be composed of we should add that the RNHCI should 1861(ss)(3)(B)(i) of the Act as the basis the administrator, superintendent of be required to ensure that the meals for the objection. nursing, the assistant superintendent of served to beneficiaries meet the Response: Again, we appreciate the nursing or another Christian Science recommended daily allowances of the commenter’s suggestion for additional nurse, and a nonvoting secretary/ Food and Nutrition Board of the language, but we do not agree that the recorder. National Research Council, National requirement violates section Response: We appreciate the Academy of Sciences, ‘‘except insofar as 1861(ss)(3)(B)(i) of the Act. The commenter’s concerns; however, we do compliance with such dietary requirement for discharge planning is not agree with these suggestions. The allowances would be contrary to the for the safety of the patient and does not purpose of this requirement is to afford

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00021 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66716 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

the governing body the opportunity to IV. Provisions of the Final Rule Additional Change Affecting the Rule be involved in the daily operations of A final rule published on January 10, the provider. With current technology, For the most part, this final rule incorporates the provisions of the 2003 (68 FR 1374) revised § 403.744 that including the governing body in the UR set forth the condition of participation committee meetings may be November 30, 1999 interim final rule. However, we are making the following for life safety from fire. That final rule accomplished via many avenues (for amended the fire safety standards for example, teleconferencing). minor changes to our regulations: • We are making editorial changes to most health care providers, including Comment: One commenter stated that § 403.736(a)(3) to clarify our policy RNHCIs. It adopted the 2000 edition of the proposed regulations do not specify regarding the discharge planning the Life Safety Code and eliminated the frequency of the UR committee evaluation. We are specifying that the references in our regulations to all meeting. The organization believes that discharge planning evaluation must be earlier editions. The regulation became the rules before implementation of the included in the patient’s ‘‘care’’ record effective March 11, 2003. Since the rule BBA ’97, which required a meeting at rather than the patient’s ‘‘rights’’ record published in January updated this least every 14 days, were appropriate and specified that staff are required to provision, we are not republishing or and should be in the new rule. discuss the results of the evaluation making any additional changes to Response: We appreciate the with the beneficiary. § 403.744 of the regulations. commenter’s suggestion, but we do not • We are amending to § 403.738(a) to V. Collection of Information agree. Because there is no medical include that RNHCIs must comply with Requirements necessity for RNHCI UR committee Federal, State, and local laws pertaining meetings within certain time frames, we Under the Paperwork Reduction Act to ‘‘privacy of individually identifiable did not see a necessity to mandate these of 1995 (PRA), we are required to health information (45 CFR part 164).’’ provide 30-day notice in the Federal timeframes. Additionally, not • mandating a timeframe for the We are amending the introductory Register and solicit public comment frequency of UR committee meetings is text of § 489.102 to add RNHCIs among before a collection of information less burdensome for the provider and the list of providers that must maintain requirement is submitted to the Office of can appropriately accommodate patient written policies and procedures Management and Budget (OMB) for needs within an individual RNHCI. concerning advance directives. In review and approval. In order to fairly addition, we are adding that these evaluate whether an information C. National Fire Safety Protection advance directives must be maintained collection should be approved by OMB, Association with respect to all adult individuals section 3506(c)(2)(A) of the PRA Condition of Participation: Life Safety receiving medical care, ‘‘or patient care requires that we solicit comment on the From Fire § 403.744(a)(1) in the case of a patient in a religious following issues: nonmedical health care institution.’’ We • The need for the information Comment: The commenter intended to make these changes in the collection and its usefulness in carrying commended us for our recognition of interim final rule; however, they were out the proper functions of our agency. the National Fire Safety Protection not incorporated due to an error in our • The accuracy of our estimate of the Association as state-of-the-art amendatory language. information collection burden. technology in fire and life safety • Section 1861(ss)(i) of the Act • The quality, utility, and clarity of protection and the best method to specifies the requirements that a the information to be collected. provide continued health care fire safety Medicare or Medicaid provider must • Recommendations to minimize the to Medicare and Medicaid beneficiaries. meet to satisfy the definition of a information collection burden on the The association applauded our reference RNHCI. In addition, section 1866 of the affected public, including automated of the 1997 edition of the Life Safety Act requires that all providers of collection techniques. Code that, they stated, showed our services under Medicare enter into a We are soliciting public comment on commitment to Public Law 104–113, the provider agreement with the Secretary each of the issues for the provisions ‘‘National Technology Transfer and and comply with other requirements summarized below that contain Advancement Act of 1995’’ (requires specified in that section. Currently, all information collection requirements: Federal government agencies to use of the 16 not-for-profit Medicare/ private sector, national consensus Medicaid RNHCI providers have Section 403.724 Valid Election technology standards in carrying out provider agreements with CMS. In the Requirements public policy wherever appropriate). November 30, 1999 interim final rule, In summary, § 403.724(a)(1) requires Response: We appreciate the we intended to revise the regulations to an RNHCI to use a written election commenter’s support. When we include RNHCIs among the providers statement that includes the published the November 30, 1999 required to enter into provider requirements set forth in this section. interim final rule, we required RNHCIs agreements in accordance with the The burden associated with this to comply with the 1997 edition of the statute. These revisions were requirement is the one-time effort Life Safe Code, which, at that time, was inadvertently omitted from the interim required to agree on the format for the the latest edition. Since that time, a new final rule. Therefore, in this final rule, election statement. It was estimated that regulation was published updating the we are revising the regulations at part it would take each RNHCI 2 hours to Life Safety Code for providers, 489 so that RNHCIs are subject to the comply with these requirements. This including RNHCIs. Therefore, we are requirements regarding provider was completed by the 16 RNHCIs when now requiring RNHCIs to comply with agreements and supplier approval. In they started participating in the the 2000 edition of the Life Safety Code addition we are revising regulations at program. We know of only one provider that we incorporated by reference in the part 498 to ensure the RNHCI access to that is considering applying to final rule published in the Federal the appeals process in the case of an participate; thus, there will be a possible Register on January 10, 2003 (68 FR adverse determination concerning total of 2 burden hours. There have been 1374). That rule became effective on continued participation in the Medicare no new applications since the first March 11, 2003. program. providers transitioned into the RNHCI

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00022 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66717

program. The burden associated with these requirements would be incurred Section 403.736(b)(3) states that the signing, filing, and submitting the by persons in the normal course of their RNHCI must arrange for the initial election statement is described in activities. implementation of the patient’s § 403.724(a)(2), § 403.724(a)(3), and discharge plan. Section 403.730 Condition of § 403.724(a)(4). Section 403.736(b)(4) states that, if In summary § 403.724(a)(2) and Participation: Patient Rights there are factors that may affect § 403.724(a)(3) require that an election Section 403.730(a)(1) states that the continuing care needs or the must be signed and dated by the RNHCI must inform each patient of his appropriateness of the discharge plan, beneficiary or his or her legal or her rights in advance of furnishing the RNHCI must reevaluate the representative and have it notarized. patient care. beneficiary’s discharge plan. The burden associated with this Section 403.730(b)(3) states that the Section 403.736(b)(5) states that the requirement is the time required for the RNHCI must formulate advance RNHCI must inform the beneficiary or beneficiary or his or her legal directives and expect staff who furnish legal representative about the representative to read, sign, and date the care in the RNHCI to comply with those beneficiary’s post-RNHCI care election statement and have it notarized. directives, in accordance with part 489, requirements. It is estimated that it will take each subpart I of this chapter. For purposes Section 403.736(b)(6) states that the beneficiary approximately 10 minutes to of conforming with the requirement in discharge plan must inform the read, sign, and date the election § 489.102 that there be documentation beneficiary or his or her legal statement. We anticipate that the RNHCI in the patient’s medical records representative about the freedom to will have a notary present to witness concerning advanced directives, the choose among providers of care when a and notarize the election statement. patient care records of a beneficiary in variety of providers is available that are There are approximately 800 an RNHCI are equivalent to medical willing to respect the discharge beneficiaries that will be affected by this records held by other providers. preferences of the beneficiary or legal requirement for a total of 103.3 burden representative. hours during the first year of the final Section 403.732 Condition of Section 403.736(c) states that the rule. Participation: Quality Assessment and RNHCI must transfer or refer patients to Section 403.724(a)(4) requires that the Evaluation appropriate facilities (including medical RNHCI keep a copy of the election In summary, § 403.732 states that the facilities if the beneficiary so desires) as statement on file and submit the original RNHCI must develop, implement, and needed for follow up or ancillary care to CMS with any information obtained maintain a quality assessment and and notify the patient of his or her right regarding prior elections or revocations. evaluation program. to participate in planning the transfer or The burden associated with this referral in accordance with requirement is the time required for an Section 403.736 Condition of Participation: Discharge Planning §’’403.730(a)(2). RNHCI to keep a copy of the election Section 403.736(d) states that the statement and submit the original to Section 403.736(a)(1) requires that the RNHCI must reassess its discharge CMS. It is estimated that it will take 5 discharge planning evaluation must be planning process on an ongoing basis. minutes to comply with this initiated at admission and must include The reassessment must include a review requirement. During the first year, there the following: (1) An assessment of the of discharge plans to ensure that they will be approximately 800 election possibility of a patient needing post- are responsive to discharge needs. statements for a total of 66.6 burden RNHCI services and of the availability of hours. those services; and (2) an assessment of Section 403.738 Condition of If not revoked, an election is effective the probability of a patient’s capacity for Participation: Administration for life and does not need to be self-care or of the possibility of the In summary, § 403.738(a) states that completed during future admissions. patient being cared for in the an RNHCI must have written policies Section 403.724(b)(1) states that a environment from which he or she regarding its organization, services, and beneficiary can revoke his or her entered the RNHCI. administration. election statement by the receipt of Section 403.736(a)(3) states that the Section 403.738(c)(3) states that the nonexcepted medical treatment or the discharge planning evaluation must be RNHCI must furnish written notice, beneficiary may voluntarily revoke the included in the patient’s care record for including the identity of each new election and notify CMS in writing. We use in establishing an appropriate individual or company, to CMS at the anticipate that there would be very few discharge plan. Staff must discuss the time of a change, if a change occurs in (fewer than 10 beneficiaries) if any results of the discharge planning any of the following: Persons with an instances in which a beneficiary will evaluation with the patient or a legal ownership or control interest, as defined notify CMS in writing that he or she will representative acting on his or her in 42 CFR 420.201 and 455.101; the revoke his or her election statement. We behalf. officers, directors, agents, or managing believe the above requirement is not Section 403.736(b)(1) states that, if the employees; the religious entity, subject to the PRA in accordance with discharge planning evaluation indicates corporation, association, or other 5 CFR 1320.3(c)(4) since this a need for a discharge plan, qualified company responsible for the requirement does not collect and experienced personnel must management of the RNHCI; and the information from 10 or more entities on develop or supervise the development RNHCI’s administrator or director of an annual basis. of the plan. nonmedical nursing services. While the information collection Section 403.736(b)(2) states that, in While this information collection requirements summarized below are the absence of a finding by the RNHCI requirement is subject to the PRA, we subject to the PRA, we believe the that the beneficiary needs a discharge believe the burden associated with this burden associated with these plan, the beneficiary or his or her legal information collection requirement is information collection requirements is representative may request a discharge exempt as defined in 5 CFR 1320.3(c)(4), exempt as defined in 5 CFR 1320.3(b)(2) plan. In this case, the RNHCI must since it does not collect information because the time, effort, and financial develop a discharge plan for the from 10 or more entities on an annual resources necessary to comply with beneficiary. basis.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00023 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66718 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Section 403.742 Condition of Section 403.752(d)(ii) states that the Centers for Medicare & Medicaid Participation: Physical Environment RNHCI must, at time of billing, provide Services, Office of Strategic Section 403.742(a)(4) requires that a the beneficiary with his or her liability Operations and Regulatory Affairs, RNHCI have a written disaster plan to for payment, based on a calculation of Regulations Development and address loss of power, water, sewage the Medicare reduction pertaining to the Issuances Group, Attn: Dawn Willinghan, CMS–1909–F, Room C5– disposal, and other emergencies. beneficiary’s covered services permitted 14–03, 7500 Security Boulevard, Section 403.742(b)(3) requires that by § 403.750(b). Baltimore, MD 21244–1850; and CMS may permit variances in We believe that this ICR is not subject to the PRA, as implemented by 5 CFR Office of Information and Regulatory requirements specified in paragraphs Affairs, Office of Management and (b)(1)(i) and (b)(1)(ii) of this section 1320.4(a)(2), since the collection action is conducted during an investigation or Budget, Room 10235, New Executive relating to rooms on an individual basis Office Building, Washington, DC when the RNHCI adequately audit against specific individuals or entities. 20503, Attn.: Brenda Aguilar, CMS demonstrates in writing that the Desk Officer. variances meet the requirements of this Section 440.170 General Provisions— section. Medicaid VI. Regulatory Impact Statement While this information collection A. Overall Impact requirement is subject to the PRA, we Section 440.170(b)(9) states that an believe the burden associated with this RNHCI must provide, upon request, We have examined the impacts of this ICR is exempt as defined in 5 CFR information CMS may require to rule as required by Executive Order 1320.3(c)(4), since it does not collect implement section 1821 of the Act, 12866 (September 1993, Regulatory information from 10 or more entities on including information relating to quality Planning and Review), the Regulatory an annual basis. of care coverage and determinations. Flexibility Act (RFA) (September 16, 1980, Pub. L. 96–354), section 1102(b) of Section 403.746 Condition of Section 489.102 Requirements for Providers the Social Security Act, the Unfunded Participation: Utilization Review Mandates Reform Act of 1995 (Pub. L. In summary, § 403.746 states that the The ICR in the following section, 104–4), and Executive Order 13132. RNHCI must have in effect a written except for its application to RNHCIs, has Executive Order 12866 (as amended utilization review plan to assess the been approved under OMB approval by Executive Order 13258, which necessity of services furnished. The number 0938–0610. merely reassigns responsibility of plan must provide that records be In summary, § 489.102(a) requires that duties) directs agencies to assess all maintained of all meetings, decisions, hospitals, critical access hospitals, costs and benefits of available regulatory and actions by the utilization review skilled nursing facilities, home health alternatives and, if regulation is committee. The utilization review plan agencies, providers of home health care necessary, to select regulatory must contain written procedures for (and for Medicaid purposes, providers approaches that maximize net benefits evaluating the following: Admissions, of personal care services), hospices, and (including potential economic, the duration of care, continuing care of religious nonmedical health care environmental, public health and safety an extended duration, and items and institutions document and maintain effects, distributive impacts, and services furnished. written policies and procedures equity). A regulatory impact analysis The following sections describe the concerning advance directives with (RIA) must be prepared for major rules burden associated with the payment respect to all adult individuals receiving with economically significant effects provisions. Based on the most recent medical care. ($100 million or more in any 1 year). data available, Medicare expenditures For the current approval, we stated This rule provides religious for Christian Science sanatoria were that it will take each facility 3 minutes nonmedical health care institution approximately $5 million annually. The to document a beneficiary’s record (RNHCI) inpatient services to trigger level for FFY 1998, the first year whether he or she has implemented an individuals qualifying for Medicare or of RNHCI implementation, was $20 advance directive. We anticipate that it Medicaid benefits, who because of their million. Beginning in FFY 2000, when will also take each RNHCI 3 minutes per religious beliefs do not find it estimated expenditures for RNHCI patient to comply with this requirement, appropriate to use conventional medical services exceed the trigger level for a for a total of 104 burden hours on an care. The rule provides for the physical FFY, CMS must adjust the RNHCI annual basis. In addition, there will be care of these beneficiaries in RNHCIs payment rates. Therefore, the burden a one-time burden of 8 hours per RNHCI but does not provide payment for the associated with the following sections is to maintain written policies and religious component of care. Currently, not subject to the PRA at this point in procedures concerning advance only 16 RNHCI facilities nationally time. directives, for a total of 152 hours. participate in the program, with We will submit a revision to OMB expenditure levels approximately $5 Section 403.752 Payment Provisions approval number 0938–0610 to reflect million annually. This rule does not Section 403.752(d)(i) states that the the addition of RNHCIs to the reach the economic threshold and thus RNHCI must notify the beneficiary in paperwork burden. is not considered a major rule. writing at the time of admission of any We have submitted a copy of this rule B. Anticipated Effects proposed or current proportional to OMB for its review of the ICRs. These Medicare adjustment. A beneficiary requirements are not effective until they 1. Effects on Small Business currently receiving care in the RNHCI have been approved by OMB. A notice The RFA requires agencies to analyze must be notified in writing 30 days will be published in the Federal options for regulatory relief of small before the Medicare reduction is to take Register when approval is obtained. businesses. For purposes of the RFA, effect. The notification must inform the If you comment on these information small entities include small businesses, beneficiary that the RNHCI can bill him collection and recordkeeping nonprofit organizations, and or her for the proportional Medicare requirements, please mail copies government agencies. Most hospitals adjustment. directly to the following: and most other providers and suppliers

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00024 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66719

are small entities, either by nonprofit governments mentioned or on the Section 4454 of BBA ’97 establishes status or by having revenues of $6 private sector. certain controls on the amount of million to $29 million in any 1 year. For Executive Order 13132 establishes expenditures for RNHCI services in a purposes of the RFA, all of the 16 not- certain requirements that an agency given FFY. Section 1821(c)(2)(C) of the for-profit Medicare/Medicaid RNHCI must meet when it promulgates a Act explains the operation of these providers are considered small proposed rule (and subsequent final controls through the use of a trigger businesses according to the Small rule) that imposes substantial direct level. Business Administration’s size requirement costs on State and local The trigger level is used to determine standards, with total revenues of $6 governments, preempts State law, or if Medicare payments for the current million or less in any one year. otherwise has Federalism implications. FFY need to be adjusted. If the Individuals and States are not included In accordance with the provisions of estimated level of expenditures for an in the definition of a small entity. Executive Order 13132, this regulation FFY exceeds the trigger level for that Currently, only one religious group is will not significantly affect any State or FFY, we are required under statute to participating in the RNHCI program and local government. This rule describes make a proportional adjustment to no other groups have applied for only processes that must be undertaken payments or alternative adjustments to participation. The RNHCIs are operated if a State chooses to exercise its option prevent expenditures from exceeding as independent facilities by individual to amend the State plan and include the trigger level. boards composed of members from the coverage of inpatient RNHCI services. BBA ’97 precludes administrative or religious group. The facilities are not in Those States that have RNHCI judicial review of adjustments that we competition with other medical care facilities and have selected to offer the determine are necessary to control providers in any geographical area since optional RNHCI service are very limited. expenditures. The trigger level is also they pursue a religious rather than a Currently, we only have 16 facilities used to activate the sunset provision, medical approach to health care. We are participating in Medicare and one of which prohibits us from accepting any not preparing an analysis for the RFA these is dually eligible to participate in new elections when estimated because we have determined that this Medicare and Medicaid. The monitoring expenditures exceed the trigger level for rule will not have a significant of the program is conducted by staff in 3 consecutive fiscal years. It must be economic impact on a substantial noted that the trigger level has not been number of small entities. the Boston Regional Office (Region I) and they will be responsible for the even closely approached since the 2. Effects on Other Health Care survey and certification activity that is inception of the program. Currently, there are 16 RNHCIs that Providers usually conducted by a State Agency. are furnishing services and receiving Since this regulation does not impose In addition, section 1102(b) of the Act payment under Medicare. One of these any costs on State or local governments, requires us to prepare a regulatory facilities is dually eligible to participate the requirements of E.O. 13132 are not impact analysis if a rule may have a in Medicare and Medicaid. There have applicable. significant impact on the operations of been no Medicaid expenditure reports a substantial number of small rural 4. Effect on the Medicare and Medicaid submitted by any State for several years. hospitals. This analysis must conform to Programs the provisions of section 604 of the 5. Effects on RNHCIs RFA. For purposes of section 1102(b) of Section 4454 of BBA ’97 removed the The rule enables RNHCI providers the Act, we define a small rural hospital authorization for payment for services and beneficiaries the opportunity to as a hospital that is located outside of furnished in Christian Science sanatoria continue to receive funding for inpatient a Metropolitan Statistical Area and has from under both Medicare and health care service that are in keeping fewer than 100 beds. This rule will not Medicaid. Section 4454 authorizes with their religious convictions. have a significant impact on small rural payment for inpatient services in an Additionally, the rule provides that a hospitals. The RNHCIs are not in RNHCI for beneficiaries who, for beneficiary will always have the option competition with other medical care religious reasons, are conscientiously of choosing to seek conventional providers in any geographical area, opposed to the acceptance of medical medical care for covered services. since they pursue a religious rather than care. Section 4454 of BBA ’97 provides a medical approach to health care. for coverage of the nonmedical aspects C. Alternatives Considered Currently, all of the RNHCIs are located of inpatient care services in RNHCIs This final rule adheres to the statutory in metropolitan rather than rural areas. under Medicare and as a State option provisions, which in many instances We are not preparing an analysis for under Medicaid. In order for a provider were very prescriptive; however, we section 1102(b) of the Act because we to satisfy the definition of a religious used every opportunity possible to have determined that this rule will not nonmedical health care institution, for consider alternative approaches as have a significant impact on the both Medicare and Medicaid, it must discussed below. operations of a substantial number of satisfy the 10 qualifying provisions Elections small rural hospitals. contained in section 1861(ss)(1) of the Act. The RNHCI choosing to participate The statute does not prescribe when 3. Effects on States, Local or Tribal in Medicare must also be in compliance the election must be made except to Governments with both the conditions for coverage specify that it must be made before Section 202 of the Unfunded and the conditions of participation receiving care. Initially, we considered Mandates Reform Act of 1995 also contained in the regulations. Neither the possibility of opening the election requires that agencies assess anticipated Medicare nor Medicaid will pay for any process to all eligible beneficiaries, who costs and benefits before issuing any religious aspects of care provided in would wish to pursue RNHCI services, rule that may result in expenditure in these facilities. CMS has used one fiscal to ensure these benefits would be any one year by State, local, or tribal intermediary to handle all RNHCIs and available when they were admitted to an governments, in the aggregate, or by the the Boston Regional Office to monitor RNHCI. However, some religious groups private sector, of $110 million. This rule the process, and we plan to continue consider it acceptable to receive some will have no consequential effect on the that arrangement. medical care (for example, closed

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00025 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66720 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

reduction of fractures) that is considered 42 CFR Part 498 (b) The following providers are as nonexcepted care under the RNHCI subject to the provisions of this part: Administrative practice and amendments to the statute and procedure, Health facilities, Health * * * * * regulations. With the above cited professions, Medicare, Reporting and (9) Religious nonmedical health care approach to elections, we might be recordkeeping requirements. institutions (RNHCIs). placing some beneficiaries in a position of having an RNHCI election revoked ■ For reasons set forth in the preamble, * * * * * one or more times without ever being the Centers for Medicare & Medicaid ■ 3. In § 489.10 paragraphs (a) and (c) are admitted to an RNHCI. This would Services amends 42 CFR chapter IV as revised to read as follows: subject a beneficiary to having to wait set forth below: § 489.10 Basic requirements. the prescribed period of time between revocation and when they could again PART 403—SPECIAL PROGRAMS AND (a) Any of the providers specified in file a viable election. Therefore, we PROJECTS § 489.2 may request participation in Medicare. In order to be accepted, it decided it was in the beneficiary’s best ■ 1. The authority citation for part 403 must meet the conditions of interest to initiate the election process at continues to read as follows: the time of admission to an RNHCI. participation or requirements (for SNFs) Authority: Secs. 1102 and 1871 of the set forth in this section and elsewhere Payment to Providers Social Security Act (42 U.S.C. 1302 and in this chapter. The RNHCIs must meet The statute provided flexibility for 1395hh). the conditions for coverage, conditions provider payment and initially we Subpart G—Religious Nonmedical for participation and the requirements continued the new provider group Health Care Institutions—Benefits, set forth in this section and elsewhere under the TEFRA payment methodology Conditions of Participation, and in this chapter. to ensure a smooth transition. The new Payment * * * * * RNHCI group was already facing a (c) In order for a hospital, SNF, HHA, number of changes when compared ■ 2. In § 403.736, paragraph (a)(3) is hospice, or RNHCI to be accepted, it with their prior requirements as revised to read as follows: must also meet the advance directives Christian Science sanatoria. We requirements specified in subpart I of considered the possibility of moving § 403.736 Condition of participation: this part. swiftly to a prospective payment Discharge planning. * * * * * methodology as systems were being * * * * * developed for skilled nursing facilities, (a) Standard: Discharge planning ■ 4. In § 489.53 paragraph (a) introductry home health agencies and rehabilitation evaluation. *** text is republished and paragraph (a)(3) hospitals. While the new methodologies (3) The discharge planning evaluation is revised to read as follows: were different from those under the must be included in the patient’s care § 489.53 Termination by CMS. hospital diagnosis related group (DRG), record for use in establishing an there was still a partial diagnosis based appropriate discharge plan. Staff must (a) Basis for termination of agreement relationship to the payment system. discuss the results of the discharge with any provider. CMS may terminate Since the statute prohibits the use of planning evaluation with the patient or the agreement with any provider if CMS diagnosis or other medical approaches a legal representative acting on his or finds that any of the following failings for assessing RNHCI patients, we have her behalf. is attributable to that provider: decided to wait until we can conduct * * * * * * * * * * studies and find a methodology that is (3) It no longer meets the appropriate ■ 3. In § 403.738, paragraph (a)(4) is fully appropriate for the RNHCI setting. conditions of participation or added to read as follows: D. Conclusion requirements (for SNFs and NFs) set For the above reasons, we are not § 403.738 Condition of participation: forth elsewhere in this chapter. In the preparing analyses for either the RFA or Administration. case of an RNHCI no longer meets the section 1102(b) of the Act. We have * * * * * conditions for coverage, conditions of determined that this rule will not have (a) Standard: Compliance with participation and requirements set forth a significant economic impact on a Federal, State, and local laws. *** elsewhere in this chapter. substantial number of small entities or (4) Privacy of individually identifiable * * * * * a significant impact on the operations of health information (45 CFR part 164). ■ 5. In § 489.102, paragraph (a) a substantial number of small rural * * * * * introductory text is revised to read as hospitals. follows: In accordance with the provisions of PART 489—PROVIDER AGREEMENTS Executive Order 12866, this regulation AND SUPPLIER APPROVAL § 489.102 Requirements for providers. was reviewed by the Office of (a) Hospitals, critical access hospitals, Management and Budget. ■ 1. The authority citation for part 489 skilled nursing facilities, nursing continues to read as follows: List of Subjects facilities, home health agencies, Authority: Secs. 1102 and 1871 of the providers of home health care (and for 42 CFR Part 403 Social Security Act (42 U.S.C. 1302 and Medicaid purposes, providers of Health insurance, Hospitals, 1395hh). personal care services), hospices, and Intergovernmental relations, Medicare, ■ 2. In § 489.2, paragraph (b) religious nonmedical health care Reporting and recordkeeping introductory text is republished and a institutions must maintain written requirements. new paragraph (b)(9) is added to read as policies and procedures concerning follows: advance directives with respect to all 42 CFR Part 489 adult individuals receiving medical Health facilities, Medicare, Reporting § 489.2 Scope of part. care, or patient care in the case of a and recordkeeping requirements. * * * * * patient in a religious nonmedical health

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00026 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66721

care institution, by or through the DEPARTMENT OF HEALTH AND enclose your Visa or Master Card provider and are required to: HUMAN SERVICES number and expiration date. Credit card * * * * * orders can also be placed by calling the Centers for Medicare & Medicaid order desk at (202) 512–1800 or by PART 498—APPEALS PROCEDURES Services faxing to (202) 512–2250. The cost for FOR DETERMINATIONS THAT AFFECT each copy is $10. As an alternative, you PARTICIPATION IN THE MEDICARE 42 CFR Part 408 can view and photocopy the Federal PROGRAM AND FOR RIN 0938–AL49 Register document at most libraries DETERMINATIONS THAT AFFECT THE designated as Federal Depository PARTICIPATION OF ICFs/MR AND [CMS–6016–F] Libraries and at many other public and academic libraries throughout the CERTAIN NFs IN THE MEDICAID Medicare Program; Reduction in country that receive the Federal PROGRAM Medicare Part B Premiums as Register. This Federal Register Additional Benefits Under document is also available from the ■ 1. The authority citation for part 498 Medicare+Choice Plans Federal Register online database continues to read as follows: through GPO access, a service of the AGENCY: Centers for Medicare & U.S. Government Printing Office. The Authority: Secs. 1102 and 1871 of the Medicaid Services (CMS), HHS. Social Security Act (42 U.S.C. 1302 and Web site address is: http:// 1395hh). ACTION: Final rule. www.access.gpo.gov/nara/index.html. ■ 2. In § 498.2 the definition of SUMMARY: This final rule revises the I. Background ‘‘provider’’ is revised to read as follows: regulations to provide for a Section 606 of the Medicare, Medicare+Choice organization to offer a Medicaid, and SCHIP Benefits § 498.2 Definitions. reduction in the standard Medicare Part Improvement and Protection Act of * * * * * B premium as an additional benefit 2000 (BIPA) amended section 1854 (f) under one or more Medicare+Choice (1) of the Social Security Act (the Act) Provider means a hospital, critical (M+C) plans. The legislation specifies access hospital (CAH), skilled nursing by allowing Medicare+Choice (M+C) that the reduction to the Medicare Part organizations to elect to receive a facility (SNF), comprehensive B premium cannot exceed the standard reduction in its payment under outpatient rehabilitation facility (CORF), Medicare Part B premium amount and § 422.250(a)(1), 80 percent of which home health agency (HHA), hospice, or cannot be applied to surcharges. would be applied to reduce (or religious nonmedical health care Surcharges are increased premiums for eliminate) the standard Medicare Part B institution (RNHCI) that has in effect an late enrollment and for reenrollment. premium otherwise paid by, or on agreement to participate in Medicare, The Medicare Part B premium may be behalf of, its Medicare enrollees. This that has in effect an agreement to collected by a variety of methods: Paid was intended to make the M+C plan participate in Medicaid, or a clinic, directly to the Centers of Medicare & more attractive to Medicare rehabilitation agency, or public health Medicaid Services by the beneficiary; beneficiaries and increase enrollment in agency that has a similar agreement but collected as an adjustment to any Social M+C plans. only to furnish outpatient physical Security, Railroad Retirement, or Civil Beneficiaries must pay a premium in therapy or outpatient speech pathology Service Retirement benefits; paid by an order to receive Supplementary Medical services, and prospective provider employer as part of an annuity package; Insurance benefits commonly referred to means any of the listed entities that or, paid by the State for individuals as Medicare Part B. The Part B seeks to participate in Medicare as a enrolled in a qualifying State Medicaid premiums are collected monthly, most provider or to have any facility or program. This legislation applies to commonly as deductions from the organization determined to be a benefits under Medicare M+C plans beneficiary’s Social Security or other offered by an M+C organization electing department of the provider or provider- retirement benefits. They also may be this option, beginning January 1, 2003. based entity under § 413.65 of this paid by a third party, such as an This final rule revises the regulations to chapter. employer or the State Medicaid set out the basic rules under section 606 program, or are paid directly by the * * * * * of the Medicare, Medicaid, and SCHIP beneficiary. (Catalog of Federal Domestic Assistance Benefits Improvement Protection Act of The provisions of this final rule Program No. 93.773, Medicare—Hospital 2000 (BIPA) for adjustment and revising part 408 to reflect the Insurance; Program No. 93.774, Medicare— payment of the Medicare Part B provisions of section 606 of BIPA are Supplementary Medical Insurance Program; premium. described in detail in section II, and Program No. 93.778, Medical Assistance EFFECTIVE DATE: The provisions of this Provisions of the Final Rule. Program) final rule are effective December 29, II. Provisions of the Final Rule Dated: May 19, 2003. 2003. We are making the following revisions Thomas A. Scully, FOR FURTHER INFORMATION CONTACT: to 42 CFR part 408 to reflect changes in Administrator, Centers for Medicare and Michele Sanders, (410) 786–0808. the statute made in section 606 of BIPA: Medicaid Services. SUPPLEMENTARY INFORMATION: To order We are adding a new § 408.21 entitled Dated: , 2003. copies of the Federal Register ‘‘Reduction in Medicare Part B Premium Tommy G. Thompson, containing this document, send your as an Additional Benefit Under Secretary. request to: New Orders, Superintendent Medicare+Choice Plans.’’ This new [FR Doc. 03–29139 Filed 11–26–03; 8:45 am] of Documents, P.O. Box 371954, provision includes paragraphs treating, Pittsburgh, PA 15250–7954. Specify the respectively, the basis for a reduction of BILLING CODE 4120–01–P date of the issue requested and enclose Medicare Part B premiums, the a check or money order payable to the administrative requirements for a Superintendent of Documents, or Medicare Part B premium reduction,

VerDate jul<14>2003 20:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00027 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66722 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

beneficiary eligibility, and notification Part B premium reduction amount for effects; distributive impacts; and of premium reductions. each eligible beneficiary, the SSA, RRB, equity). A regulatory impact analysis In § 408.21(a), we set forth language or OPM, as applicable, will include the (RIA) must be prepared for major rules reflecting the fact that, under section adjusted amount of the Medicare Part B with economically significant effects 606 of BIPA, an M+C organization may premium in benefit check amounts as ($100 million or more annually). This is offer, as an additional benefit under an appropriate and notify the beneficiaries not a major rule. It will have no M+C plan, a reduction in the amount of their new benefit amount. The significant economic impact on either that an enrollee in the M+C plan pays paragraph also notes that we will notify costs or savings and may result in lower to Medicare for the Medicare Part B States, formal groups, and directly premiums for some beneficiaries. premium. For the Medicare Part B billed beneficiaries of each beneficiary’s The RFA requires agencies to analyze premium reduction to occur, the M+C reduced Medicare Part B premium options for regulatory relief of small organization must accept a reduction in amounts in the regular monthly billing businesses. For purposes of the RFA, its monthly capitation payments under process. small entities include small businesses, § 422.250(a)(1). The Medicare Part B nonprofit organizations, and premium paid by a beneficiary enrolled III. Collection of Information government agencies. Most hospitals in an M+C plan that offers this Requirements and most other providers and suppliers additional benefit will be reduced by 80 Under the Paperwork Reduction Act are small entities, either by nonprofit percent of the amount that the of 1995, we are required to provide 60- status or by having revenues of $6 capitation payment to the M+C day notice in the Federal Register and million to $29 million annually (see 65 organization is reduced. The Medicare solicit public comment before a FR 69432). Individuals and States are Part B premium reduction may not collection of information requirement is not included in the definition of small exceed the standard Medicare Part B submitted to the Office of Management entities. premium amount, and if the beneficiary and Budget (OMB) for review and In addition, section 1102(b) of the Act owes less than this amount, the approval. In order to fairly evaluate requires us to prepare a regulatory difference is not paid to the Medicare whether an information collection impact analysis if a rule may have a beneficiary. should be approved by OMB, section significant impact on the operations of In § 408.21(b), we set forth the 3506c(2)(A) of the Paperwork Reduction a substantial number of small rural administrative requirements under Act of 1995 requires that we solicit hospitals. This analysis must conform to section 606 of BIPA for the Medicare comment on the following issues: the provisions of section 604 of the Part B premium reductions. These RFA. For purposes of section 1102(b) of —The need for the information requirements include: (1) The M+C the Act, we define a small rural hospital collection and its usefulness in capitation reduction must not result in as a hospital located outside of a a Medicare Part B premium reduction carrying out the proper functions of Metropolitan Statistical Area with fewer greater than the standard premium our agency. than 100 beds. amount determined for the year under —The accuracy of our estimate of the We are not preparing analyses for section 1839 of the Act (the reduction to information collection burden. either the RFA or section 1102(b) of the the Medicare Part B premium may be —The quality, utility, and clarity of the Act because we have determined, and less); (2) the Medicare Part B premium information to be collected. we certify, that this rule will have no reduction will use only multiples of 10 —Recommendations to minimize the impact on any small entities or rural cents; (3) the Medicare Part B premium information collection burden on the hospitals. reduction will be applied to all affected public, including automated Section 202 of the Unfunded beneficiaries who are enrolled in the collection techniques. Mandates Reform Act of 1995 requires M+C plan under which the benefit is There are no information collection that agencies assess anticipated costs offered without regard to who actually requirements associated with this final and benefits before issuing any rule that pays/collects the Medicare Part B rule. This provision is strictly voluntary may result in an expenditure in any one premium (Social Security and is provided as a benefit option for year by State, local, or tribal Administration (SSA), Railroad M+C organizations. governments, in the aggregate, or by the private sector, of $110 million. This Retirement Board (RRB), Office of IV. Regulatory Impact Personnel Management (OPM), the final rule will have a positive effect on beneficiary, the State, or employer); (4) We have examined the impacts of this the annual expenditures of any State, The Medicare Part B premium reduction final rule as required by Executive local, or tribal government, or private will never result in a payment to a Order 12866 (September 1993, sector with enrollees covered under a beneficiary. (If the amount of the Regulatory Planning and Review), the State buy-in agreement or group payer reduction is equal to or greater than the Regulatory Flexibility Act (RFA) arrangement as set forth in subpart C amount a beneficiary owes due to hold (, 1980, Pub. L. 96–354), and E, respectively, of part 407 of this harmless premiums, the beneficiary will section 1102(b) of the Social Security chapter; and, whose enrollees opt to owe $0.) Act, the Unfunded Mandates Reform enroll in a Medicare+Choice Section 408.21(c) specifies the Act of 1955 (Pub. L. 104–4), and organization’s (M+CO) Plan Benefit eligibility requirements under section Executive Order 13132. Package that offers a reduction to the 606 of BIPA for the Medicare Part B Executive Order 12866 (as amended Medicare Part B premium permitted as premium reduction; namely that, in by Executive Order 13258, which an additional benefit, authorized under order to be eligible for the reduction, a merely reassigns responsibility of section 606 of the BIPA and defined beneficiary must be enrolled in an M+C duties) directs agencies to assess all under part 422, subpart A of this plan that offers the reduction to the costs and benefits of available regulatory chapter. Any reduction to the Medicare Part B premium as an alternatives and, if regulation is beneficiary’s Medicare Part B premium additional benefit. necessary, to select regulatory will be applied regardless of the entity Section 408.21(d) explains that after approaches that maximize net benefits that actually pays the Medicare Part B the Centers for Medicare & Medicaid (including potential economic, premium on behalf of the beneficiary. Services (CMS) determines the Medicare environmental, public health and safety The entity that actually pays the

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00028 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66723

Medicare Part B premium would receive taken effect consistent with the effective (1) Transmit this information to the the benefit of this reduction under this dates established under the BIPA. Social Security Administration, rule. If a beneficiary is paying the Railroad Retirement Board, or the Office List of Subjects in 42 CFR Part 408 premium, he or she would pay a lower of Personnel Management, as premium. If another entity pays the Medicare. appropriate, which will adjust the premium, they would receive the ■ For the reasons set forth in the benefit check amounts as appropriate savings. preamble, the Centers for Medicare & and notify the beneficiaries of their new Executive Order 13132 establishes Medicaid Services amends 42 CFR benefit amount. certain requirements that an agency chapter IV, part 408 as set forth below: (2) Notify states and formal groups must meet when it promulgates a final and direct billed beneficiaries of their rule that imposes substantial direct PART 408—PREMIUMS FOR reduced premium amounts in the requirement costs on State and local SUPPLEMENTAL MEDICAL regular monthly billing process. governments, preempts State law, or INSURANCE (Catalog of Federal Domestic Assistance otherwise has Federalism implications. ■ 1. The authority citation for part 408 Program No. 93.774, Medicare— This final rule would impose no direct continues to read as follows: Supplementary Medical Insurance Program) requirement costs on State and local governments, would not preempt State Authority: Secs. 1102 and 1871 of the Dated: , 2003. law, or have any Federalism Social Security Act (42 U.S.C. 1302 and Thomas A. Scully, 1395hh). implications. Participation is strictly Administrator, Centers for Medicare & Medicaid Services. voluntary. Subpart B—Amount of Monthly In accordance with the provisions of Premiums Approved: , 2003. Executive Order 12866, this final rule Tommy G. Thompson, was reviewed by the Office of ■ 2. Section 408.21 is added to read as Secretary. Management and Budget. This final rule follows: is not a major rule as defined at 5 U.S.C. [FR Doc. 03–28718 Filed 11–26–03; 8:45 am] § 408.21 Reduction in Medicare Part B BILLING CODE 4120–01–P 804(2). premium as an additional benefit under V. Waiver of Proposed Rulemaking Medicare+Choice plans. (a) Basis for reduction in Part B We ordinarily publish a notice of DEPARTMENT OF THE INTERIOR premium. Beginning January 1, 2003 an proposed rulemaking in the Federal M+C organization may elect to receive Register and invite public comment on Office of the Secretary a reduction in its payments under the proposed rule. The notice of § 422.250(a)(1) of this chapter if— proposed rulemaking includes a 43 CFR Part 4 (1) 80 percent of the payment reference to the legal authority under reduction is applied to reduce the RIN 1090–AA92 which the rule is proposed, and the standard Medicare Part B premiums of terms and substances of the proposed its Medicare enrollees. Special Rules Applicable to Surface rule or a description of the subjects and (2) The Medicare Part B premium is Coal Mining Hearings and Appeals issues involved. The notice of proposed reduced monthly and is offered to all AGENCY: Office of the Secretary, Interior. rulemaking can be waived, however, if Medicare enrollees in a specific plan ACTION: Final rule. an agency finds good cause that notice benefit package. and comment procedures are (b) Administrative requirements for SUMMARY: impracticable, unnecessary, or contrary The Office of Hearings and the Part B premium reduction. (1) The Appeals is publishing a final rule that to the public interest, and it Medicare Part B premium reduction incorporates a statement of the finding revises an existing regulation allocating cannot be greater than the standard the burden of proof in a proceeding and its reasons in the rule issued. premium amount determined for the Publishing a proposed rule is under the Surface Mining Control and year, under section 1839(a)(3) of the Reclamation Act of 1977. unnecessary in this instance, as this Act. However, it may be less. EFFECTIVE DATE: December 29, 2003. final rule only makes conforming (2) The Medicare Part B premium changes to the regulations to implement reduction must be a multiple of 10 FOR FURTHER INFORMATION CONTACT: Will sections of the BIPA in which the cents. A. Irwin, Administrative Judge, Interior Congress allowed no discretion as to the (3) The Medicare Part B premium Board of Land Appeals, U.S. actions to be taken and the times in reduction is applied regardless of who Department of the Interior, 801 N. which they must be completed. These pays or collects the Part B premium on Quincy Street, Suite 300, Arlington, changes were enacted by the Congress, behalf of the beneficiary. Virginia 22203, telephone 703–235– and would be in effect on the date (4) The Medicare Part B premium can 3750. Persons who use a mandated by the legislation without never be less than zero and will never telecommunications device for the deaf regard to whether they are reflected in result in a payment to a beneficiary for (TDD) may call the Federal Information conforming changes to the regulation a specific month. Relay Service (FIRS) at 800–877–8339. text, since a statute controls over a (c) Beneficiary eligibility. In order for SUPPLEMENTARY INFORMATION: regulation. In this final rule we merely a beneficiary to be eligible for the have revised the regulation text to Medicare Part B premium reduction, the I. Background reflect these new statutory provisions. beneficiary must be enrolled in an M+C On , 2003, the Office of The BIPA provisions have been plan that offers the Medicare Part B Hearings and Appeals (OHA) published incorporated virtually verbatim, with no premium reduction as an additional for comment a petition for rulemaking interpretation necessary. We do not benefit. that it had received from the National believe that publishing a notice of (d) Notifications. After determining Mining Association (NMA). 68 FR proposed rulemaking is necessary, nor the Medicare Part B premium reduction 13657–13661 (Mar. 20, 2003). On the would it be practicable given that a amount for each eligible beneficiary, basis of the decision of the U.S. number of the provisions have already CMS will— Supreme Court in Director, Office of

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00029 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66724 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Workers’ Compensation Programs, (1) Proceedings to review notices of application for review under this subsection Department of Labor v. Greenwich violation or cessation orders issued shall not operate as a stay of any order or Collieries, 512 U.S. 267, 114 S. Ct. 2251 under section 521 of the Act (the notice. (1994), the petition urged that OHA applicable existing rule is 43 CFR Section 525(a)(1) (emphasis added). reallocate the burden of proof in several 4.1171); (2) civil penalty proceedings Under section 525(a)(2), ‘‘[a]ny such existing rules that govern hearings (§ 4.1155); (3) individual civil penalty hearing shall be of record and shall be under the Surface Mining Control and proceedings (§ 4.1307); (4) permit subject to section 554 of title 5 of the Reclamation Act of 1977, 30 U.S.C. suspension or revocation proceedings United State Code.’’ 1201–1328 (2000) (the Act or SMCRA). (§ 4.1194); and (5) proceedings to review The existing regulation, 43 CFR The Administrative Procedure Act permit revisions ordered by OSM 4.1171, provides that OSM has the (APA), 5 U.S.C. 554 (2000), applies to (§ 4.1366(b)). ‘‘burden of going forward to establish a cases of adjudication that are required OHA received 19 comments in prima facie case as to the validity’’ of by statute to be determined on the support of the petition from mining the notice or order or its modification, record after an opportunity for an companies, mining trade associations, vacation or termination; the ‘‘ultimate agency hearing. Section 554(c)(2) of the and law firms; and it received one burden of persuasion’’ rests with the APA requires an agency to give all comment from an agency in a primacy applicant for review. OHA believes the interested parties an opportunity for a state recommending that the burden of regulation correctly allocates the hearing in accordance with sections 556 proof remain with the permittee. burdens of proof. and 557. Section 556(d) provides that As a preliminary matter OHA In Old Ben Coal Corp. v. Interior ‘‘[e]xcept as otherwise provided by observes that, although the Supreme Board of Mine Operations Appeals, 523 statute, the proponent of a rule or order Court did not discuss how often ‘‘the F.2d 25 (7th Cir. 1975), the court has the burden of proof.’’ evidence is evenly balanced,’’ in OHA’s construed nearly identical language In Greenwich Collieries, the Supreme experience under SMCRA it is quite from the Federal Coal Mine Health and Court considered whether a rule rare. See, e.g., OSM v. C-Ann Coal Co., Safety Act of 1969. Section 105(a)(1) of employed by the Department of Labor in 94 IBLA 14, 19 (1986); Harry Smith that statute, 30 U.S.C. 815(a)(1) (1976), adjudicating claims for benefits under Construction Co. v. OSM, 78 IBLA 27, provided as follows: the Black Lung Benefits Act was 29, 32 (1983). consistent with section 556(d) of the An operator issued an order pursuant to In any event, with one exception, the provisions of section 814 of this title, or APA. The Court explained that the OHA does not agree with the premise of any representative of miners in any mine effect of the rule was to ‘‘shift the the NMA petition, i.e., that SMCRA affected by such order or by any modification burden of persuasion to the party does not provide for a burden of proof or termination of such order, may apply to opposing the benefits claim—when the distinct from that set forth in section the Secretary for review of the order within evidence is evenly balanced, the 556(d) of the APA for the proceedings thirty days of receipt thereof or within thirty benefits claimant wins,’’ 512 U.S. at NMA addresses. Whether or not OSM is days of its modification or termination. 269, 114 S. Ct. at 2253. The Court ‘‘the proponent of a rule or order’’ * * * Upon receipt of such application, the construed the term ‘‘burden of proof’’ in Secretary shall cause such investigation to be within the meaning of section 556(d), it made as he deems appropriate. Such section 556(d) to mean ‘‘burden of does not bear the burden of persuasion persuasion,’’ not merely ‘‘burden of investigation shall provide an opportunity for in most of the proceedings discussed in a public hearing, at the request of the production (i.e., the burden of going NMA’s petition because SMCRA operator or the representative of miners in forward with evidence),’’ 512 U.S. at ‘‘otherwise provide[s].’’ Each of the such mine, to enable the operator and the 272, 114 S. Ct. at 2255; and it concluded proceedings is analyzed below. representative of miners in such mine to that the Department of Labor rule was present information relating to the issuance inconsistent with section 556(d), A. Proceedings To Review Notices of or continuance of such order or the pursuant to which ‘‘when the evidence Violation or Cessation Orders Issued modification or termination thereof or to the is evenly balanced, the benefits claimant Under Section 521 of the Act time fixed in such notice. The filing of an must lose.’’ 512 U.S. at 281, 114 S. Ct. Section 525(a)(1) of the Act, 30 U.S.C. application for review under this subsection shall not operate as a stay of any order or at 2259. 1275(a)(1), provides as follows: The NMA petition argued that, ‘‘[i]n notice. A permittee issued a notice or order by the (Emphasis added.) Section 105(a)(2) those proceedings where SMCRA does Secretary pursuant to the provisions of not expressly provide a burden of proof subparagraphs (a)(2) and (3) of section 521 of provided that any such hearing ‘‘shall distinct from that set forth in the APA, this title [30 U.S.C. 1271], or pursuant to a be of record and shall be subject to OHA has improperly relieved OSM [the Federal program or the Federal lands section 554 of title 5.’’ Office of Surface Mining Reclamation program, or any person having an interest The operator in that case argued that and Enforcement] of the burden of which is or may be adversely affected by a Department of the Interior regulation persuasion when OSM is the proponent such notice or order or by any modification, allocating the burden of proof under of a rule or order * * *. Since the vacation, or termination of such notice or section 105(a) to ‘‘the applicant, order, may apply to the Secretary for review petitioner, or other party initiating the ultimate burden of persuasion under of the notice or order within thirty days of section [556(d)] of the APA requires the receipt thereof or within thirty days of its proceedings’’ violated section 556(d) of agency as a proponent of a rule or order modification, vacation, or termination. Upon the APA because there was no provision to prove its case by a preponderance of receipt of such application, the Secretary in the Coal Mine Health and Safety Act the evidence * * *, OHA must revise shall cause such investigation to be made as that ‘‘require[d] the mine operator to its regulations concerning the burden of he deems appropriate. Such investigation carry the burden of proof in a review of proof to require OSM, as the proponent shall provide an opportunity for a public summary agency action.’’ 523 F.2d at of a rule or order, to prove its case by hearing, at the request of the applicant or the 35. In defending the regulation, the person having an interest which is or may be Secretary argued that section 105(a) fit a preponderance of the evidence.’’ adversely affected, to enable the applicant or Petition at 11. such person to present information relating within the ‘‘[e]xcept as otherwise The petition addressed existing OHA to the issuance and continuance of such provided by statute’’ language in section rules applicable to the burden of proof notice or order or the modification, vacation, 556(d) ‘‘because it specifically places on in five different kinds of proceedings: or termination thereof. The filing of an the operator who requests a public

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00030 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66725

hearing the burden ‘‘to present S. Rep. No. 95–128, 95th Cong., 1st of the violation and the amount of the information relating to the issuance and Sess., 92–93 (1977). civil penalty and the ultimate burden of continuance of such order [Section The legislative history also confirms persuasion as to the amount of the civil 104(a) withdrawal order].’’’ Id. at 36 what is obvious from the language of the penalty.’’ A person who petitions for (bracketed text in original). The court two statutes, namely, that SMCRA’s review of a proposed assessment of a agreed: enforcement provisions were modeled civil penalty, however, has ‘‘the We think that an examination of the after those in the Coal Mine Health and ultimate burden of persuasion as to the statutory scheme as a whole, as well as a Safety Act. Id. at 58. Thus, comparable fact of the violation.’’ review of the legislative history of the Act to the regulation at issue in Old Ben, 43 Viewing the statutory scheme as a * * *, supports respondents’ argument that CFR 4.1171 properly allocates to OSM whole, including the interplay among the Secretary’s regulation is consistent with the burden of going forward to establish SMCRA sections 518, 521, and 525, and the intent of Congress to place upon the mine a prima facie case as to the validity of in view of the legislative history and operator the primary responsibility for the the notice of violation or cessation order case precedent discussed above, OHA safety of miners. (or its modification, vacation, or concludes that the burden of proof as to Id. The court found ‘‘no compelling termination), and to the applicant for the fact of the violation in civil penalty indications that the Secretary was review the ultimate burden of proceedings fits within the exception wrong in interpreting the Act to place persuasion. language of 5 U.S.C. 556(d) and that 43 the burden of proof on the petitioner.’’ CFR 4.1155 is consistent with B. Civil Penalty Proceedings Id. On Petition for Rehearing, the court Congressional intent. clarified that, ‘‘[i]n practice * * *, the Section 518(a) of the Act, 30 U.S.C. burden of proof is split, with the 1268(a), provides that a permittee who C. Individual Civil Penalty Proceedings Government bearing the burden of going violates the Act or a permit condition Section 518(f) of the Act, 30 U.S.C. forward [to establish a prima facie case], may be assessed a civil penalty. Section 1268(f), provides that, when a corporate and the mine operator bearing the 518(b) provides that the penalty may permittee violates a condition of its ultimate burden of persuasion.’’ Id. at only be assessed after the person permit or fails or refuses to comply with 39, 40. charged with a violation has been given any order issued under section 521 of Since Old Ben dealt with the the opportunity for a public hearing the Act or any order in a final decision exception language in 5 U.S.C. 556(d), conducted in accordance with section by the Secretary (with certain rather than the meaning of the term 554 of the APA. Section 518(c) provides exceptions), any director, officer, or ‘‘burden of proof,’’ it remains good law that the person charged may contest the agent of the corporation who willfully after the Supreme Court’s decision in amount of the penalty or the fact of the and knowingly authorized, ordered, or Greenwich Collieries. II Richard J. violation. carried out the corporation’s violation or Pierce, Jr., Administrative Law Treatise Section 518(b) also provides that, its failure or refusal to comply, ‘‘shall be § 10.7 (4th ed. 2002), at 760–61. when there has been a hearing, ‘‘the subject to the same civil penalties * * * A similar examination of SMCRA’s Secretary shall * * * issue a written that may be imposed upon a person’’ language and legislative history decision as to the occurrence of the under section 518(a). demonstrates that the allocation of the violation and the amount of the penalty 43 CFR 4.1307(a) allocates to OSM the burden of proof in 43 CFR 4.1171 is which is warranted’’ and ‘‘shall burden of going forward with evidence likewise consistent with the intent of consolidate such hearings with other to establish a prima facie case that (1) Congress. The purpose of the hearing proceedings under section 521’’ when the corporation violated a permit provided in section 525(a)(1) is not for appropriate. condition or failed or refused to comply the Secretary to prove that a violation When OHA originally adopted the with an order; (2) the individual was a exists but ‘‘to enable the applicant regulation governing burdens of proof in director, officer, or agent of the * * * to present information relating to civil penalty proceedings, 43 CFR corporation at the time of the violation; the issuance and continuance of [the] 4.1155, it allocated both the burden of and (3) the individual acted willfully notice or order * * *.’’ (emphasis going forward to establish a prima facie and knowingly. Section 4.1307(b) supplied). Thus SMCRA itself places the case and the burden of persuasion to imposes on the individual the ultimate burden of proof on the applicant. This OSM, with respect to both the fact of burden of persuasion as to (1) whether interpretation is clear from the violation and the amount of the penalty. the corporation violated a permit legislative history: 43 FR 34376, 34393 (Aug. 3, 1978). The condition or failed or refused to comply In order to assure expeditious review and result was that the allocation of the with an order and (2) whether he or she due process for persons seeking ultimate burden of persuasion as to the was a director or officer at the time of administrative relief of enforcement fact of a violation was inconsistent with the violation or refusal. Section decisions of Federal inspectors under the the legislative history of the Act 4.1307(c) imposes on OSM the ultimate provisions of section [521], section [525] discussed above in connection with burden of persuasion as to (1) whether establishes clear, definitive administrative section 525. In addition, when there was the individual was an agent of the review procedures. Those persons having a consolidated hearing to review a corporation and (2) the amount of the standing to request such administrative review include permittees against whom notice or order issued under section 521 individual civil penalty. notices and orders have been issued pursuant and a civil penalty proposed under Just as the statutory scheme, to section [521] and persons having an section 518, there were contradictory legislative history, and court precedent interest which is or may be adversely affected provisions allocating the ultimate discussed above assign the burden of by such notice or order. Any person with burden of persuasion as to the fact of a persuasion as to the fact of a violation standing may request a public hearing which violation: § 4.1171 to the applicant for to a corporate permittee under section must be of record and subject to the review and § 4.1155 to OSM. 52 FR 518(a), so they support allocating the Administrative Procedure Act. The person burden of proof on that issue to the seeking review shall have the ultimate 38246–38247 (, 1987). burden of proof in proceedings to review In 1988, therefore, OHA amended individual under section 518(f). notices and orders issued under Section § 4.1155 to provide that ‘‘OSM shall However, the same conclusion cannot [521]. Pending review the notice or order have the burden of going forward to be drawn as to the individual’s role in complained of will remain in effect. * * * establish a prima facie case as to the fact the corporation. Since SMCRA does not

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00031 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66726 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

‘‘otherwise provide[]’’ an allocation of 518(b), and 518(f), therefore, SMCRA nature of such an order, the ultimate burden the burden of proof on that issue, OHA provides its own allocation of the of persuasion is properly on the permittee in agrees with NMA that the burden must burden of proof in permit suspension or 43 CFR [4.1366(b)]. Cf. 43 CFR 4.1171(b). be imposed on OSM as the proponent of revocation proceedings, and the 51 FR 35250 (Oct. 2, 1986) (emphasis the order (individual civil penalty) language of 5 U.S.C. 556(d) assigning added). under 5 U.S.C. 556(d). OHA is therefore the burden to the proponent of the order Under section 510(a) of the Act, 30 amending 43 CFR 4.1307 in this final does not apply. U.S.C. 1260(a), ‘‘[t]he applicant for a rule to state that OSM has the ultimate E. Proceedings To Review Permit permit, or revision of a permit, shall burden of persuasion as to whether the Revisions Ordered by OSM have the burden of establishing that his individual was a director, officer, or application is in compliance with all the Section 511 of the Act, 30 U.S.C. agent of the corporation. requirements of the applicable State or 1261, applies to revision of permits. Federal program.’’ If at any point the D. Permit Suspension or Revocation Section 511(a) provides that, during the permitted operation is no longer in Proceedings term of the permit, a permittee may compliance with the Act, ‘‘the apply for a revision to a permit. Section Section 521(a)(4) of the Act, 30 U.S.C. regulatory authority * * * may require 511(c) provides that the regulatory 1271(a)(4), provides as follows: reasonable revision or modification of authority must, within time limits When, on the basis of a Federal inspection the permit provisions * * * .’’ Section prescribed in regulations, review * * *, the Secretary or his authorized 511(c). It follows that, when challenging outstanding permits and may require representative determines that a pattern of OSM’s decision to require a permit violations of any requirements of this Act or reasonable revision or modification of any permit conditions required by this Act permit provisions during the term of the revision to ensure compliance with the exists or has existed, and if the Secretary or permit. The revision or modification is Act, the permit holder properly bears his authorized representative also finds that to be ‘‘based upon a written finding and the burden of persuasion. such violations are caused by the subject to notice and hearing Construing section 511(c) in light of unwarranted failure of the permittee to the statutory scheme as a whole, comply with any requirements of this Act or requirements established by the State or Federal program.’’ Id. including sections 510(a), 521(a), and any permit conditions, or that such violations 525(a), and in light of the legislative are willfully caused by the permittee, the OSM’s implementing regulations at 30 Secretary or his authorized representative CFR 774.10(a) provide that the history and case precedent interpreting shall forthwith issue an order to the regulatory authority must review each those provisions, OHA believes it has permittee to show cause as to why the permit permit issued under an approved correctly allocated the burden of proof should not be suspended or revoked and program not later than the middle of in 43 CFR 4.1366(b). shall provide opportunity for a public each permit term. The regulatory F. Conclusion hearing. If a hearing is requested, the authority ‘‘may, by order, require Secretary shall inform all interested parties of reasonable revision of a permit * * * to For the foregoing reasons, NMA’s the time and place of the hearing. Upon the petition for rulemaking is granted in permittee’s failure to show cause as to why ensure compliance with the Act and the the permit should not be suspended or regulatory program.’’ § 774.10(b). Any part with respect to 43 CFR 4.1307 and revoked, the Secretary or his authorized order requiring revision of a permit is otherwise denied. representative shall forthwith suspend or ‘‘shall be based upon written findings II. Review Under Procedural Statutes revoke the permit. and shall be subject to the provisions for and Executive Orders (Emphasis added.) Section 525(d) of the administrative and judicial review in Act, 30 U.S.C. 1275(d), provides that the [30 CFR] part 775.’’ § 774.10(c). Under A. Planning and Review (E.O. 12866). hearing shall be of record and subject to § 775.11(c), all hearings ‘‘under a accordance with the criteria in section 554 of the APA. Federal program for a State or a Federal Executive Order 12866, the Department OHA’s regulations at 43 CFR 4.1194 lands program * * * on an application of the Interior finds that this document provide that, in such proceedings, OSM for approval of * * * permit revision is not a significant rule. The Office of has the burden of going forward to shall be of record and governed by 5 Management and Budget has not establish a prima facie case for U.S.C. 554 and 43 CFR part 4.’’ reviewed this rule under Executive suspension or revocation of the permit, OHA’s regulations at 43 CFR Order 12866. but the ultimate burden of persuasion 4.1366(b) provide that, in a proceeding 1. This rule will not have an annual that the permit should not be suspended to review a permit revision ordered by economic effect of $100 million or or revoked rests with the permittee. OSM, OSM has the burden of going adversely affect an economic sector, The language of section 521(a)(4) forward to establish a prima facie case productivity, competition, jobs, the clearly assigns the burden of persuasion that the permit should be revised, and environment, public health or safety, or in permit suspension or revocation the permittee has the ultimate burden of other units of government. A cost- proceedings to the permittee. The persuasion. This allocation of the benefit and economic analysis is not legislative history confirms Congress’ burden of proof was explained in the required. The amended rule will have intent: preamble to the proposed rule: virtually no effect on the economy because it will only change the This section [section 525] also provides for A comment suggested due process requires the Secretary to hold a public hearing that 43 CFR [4.1365] should provide that the allocation of the burden of proof—from following the issuance of an order to show filing of a request for review would stay an the individual to OSM—on one issue in cause why a permit should not be revoked or OSM order requiring revision of a permit one kind of proceeding under SMCRA. suspended pursuant to [section 521]. At the because it is an ‘‘ex parte action by Moreover, the practical effect of the rule hearing the permittee shall have the burden OSM’’* * * . [B]ecause the purpose of such will be limited to the rare situation in of proof to show why his permit should not an order is to ensure compliance with the Act which the evidence on that one issue is be suspended or revoked. (see 30 CFR 774.11(b)), no stay is evenly balanced. S. Rep. No. 95–128, 95th Cong., 1st appropriate, just as it is not under 30 U.S.C. 1275(a)(1) when an application for review is 2. This rule will not create Sess., 96 (1977) (emphasis added). filed for a notice of violation or cessation inconsistencies with or interfere with As with the fact-of-the-violation issue order (unless temporary relief is granted). Cf. other agencies’ actions. The rule amends in proceedings under sections 525(a)(1), 43 CFR 4.1116. Because of the enforcement an existing OHA regulation to change

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00032 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66727

the allocation of the burden of proof in Changing the allocation of the burden of (NEPA), 42 U.S.C. 4321 et seq., Council one kind of proceeding under SMCRA. proof in one kind of proceeding under on Environmental Quality (CEQ) 3. This rule will not alter the SMCRA will neither uniquely nor regulations, 40 CFR part 1500, and the budgetary effects of entitlements, grants, significantly affect these governments. A Department of the Interior Departmental user fees, loan programs, or the rights statement containing the information Manual (DM). CEQ regulations, at 40 and obligations of their recipients. The required by the Unfunded Mandates CFR 1508.4, define a ‘‘categorical existing regulation has to do with the Reform Act, 2 U.S.C. 1531 et seq., is not exclusion’’ as a category of actions that burden of proof in one kind of required. the Department has determined proceeding under SMCRA, not with 2. This rule will not produce an ordinarily do not individually or entitlements, grants, user fees, loan unfunded Federal mandate of $100 cumulatively have a significant effect on programs, or the rights and obligations million or more on state, local, or tribal the human environment. The of their recipients. governments or the private sector in any regulations further direct each 4. This rule does not raise novel legal year, i.e., it is not a ‘‘significant department to adopt NEPA procedures, or policy issues. Rather, it conforms regulatory action’’ under the Unfunded including categorical exclusions. 40 OHA’s regulations to recent court Mandates Reform Act. CFR 1507.3. The Department has precedent. E. Takings (E.O. 12630). In determined that this rule is categorically B. Regulatory Flexibility Act. The accordance with Executive Order 12630, excluded from further environmental Department certifies that this rule will the Department finds that this rule will analysis under NEPA in accordance not have a significant economic effect not have significant takings with 516 DM 2, Appendix 1, which on a substantial number of small entities implications. A takings implication categorically excludes ‘‘[p]olicies, as defined under the Regulatory assessment is not required. Imposing on directives, regulations and guidelines of Flexibility Act (5 U.S.C. 601 et seq.). OSM the burden of proof on one issue an administrative, financial, legal, Changing the allocation of the burden of in one kind of proceeding under the technical or procedural nature.’’ In proof on one issue in individual civil SMCRA will have no effect on property addition, the Department has penalty proceedings under SMCRA will rights. determined that none of the exceptions have no effect on small entities. A Small F. Federalism (E.O. 13132). In to categorical exclusions, listed in 516 Entity Compliance Guide is not accordance with Executive Order 13132, DM 2, Appendix 2, applies to this rule. required. the Department finds that this rule does This rule is an administrative and C. Small Business Regulatory not have sufficient federalism procedural rule, relating to the Enforcement Fairness Act. This rule is implications to warrant the preparation allocation of the burden of proof in one not a major rule under 5 U.S.C. 804(2), of a Federalism Assessment. States with kind of proceeding under SMCRA. the Small Business Regulatory approved regulatory programs may be Therefore, neither an environmental Enforcement Fairness Act. affected to the extent they make a assessment nor an environmental 1. This rule will not have an annual conforming change to their own rules impact statement under NEPA is effect on the economy of $100 million and consequently bear the burden of required. or more. Changing the allocation of the proof on the issue of whether someone J. Government-to-Government burden of proof in one kind of who receives a proposed individual Relationship with Tribes. In accordance proceeding under SMCRA will have no civil penalty assessment was an officer, with the President’s memorandum of effect on the economy. director, or agent of the corporation. 29, 1994, ‘‘Government-to- 2. This rule will not cause a major These effects are so minor that a Government Relations with Native increase in costs or prices for Federalism Assessment is not required. American Tribal Governments’’ (59 FR consumers, individual industries, G. Civil Justice Reform (E.O. 12988). 22951), E.O. 13175, and 512 DM 2, the Federal, state, or local government In accordance with Executive Order Department has evaluated potential agencies, or geographic regions. 12988, the Office of the Solicitor has effects of this rule on Federally Changing the allocation of the burden of determined that this rule does not recognized Indian tribes and has proof in one kind of proceeding under unduly burden the judicial system and determined that there are no potential SMCRA will not affect costs or prices meets the requirements of sections 3(a) effects. This rule will not affect Indian for citizens, individual industries, or and 3(b)(2) of the Order. This rule, trust resources; it will simply change government agencies. because it simply changes the allocation the allocation of the burden of proof in 3. This rule will not have significant of the burden of proof proceedings in one kind of proceeding under SMCRA. adverse effects on competition, one kind of proceeding under SMCRA, K. Effects on the Nation’s Energy employment, investment, productivity, will not burden either administrative or Supply. In accordance with Executive innovation, or the ability of U.S.-based judicial tribunals. Order 13211, the Department finds that enterprises to compete with foreign- H. Paperwork Reduction Act. This this regulation does not have a based enterprises. Changing the rule will not require an information significant effect on the nation’s energy allocation of the burden of proof in one collection from 10 or more parties, and supply, distribution, or use. Changing kind of proceeding under SMCRA will a submission under the Paperwork the allocation of the burden of proof in have no effects, adverse or beneficial, on Reduction Act is not required. An OMB one kind of proceeding under SMCRA competition, employment, investment, form 83–I has not been prepared and will not affect energy supply or productivity, innovation, or the ability has not been approved by the Office of consumption. of U.S.-based enterprises to compete Policy Analysis. This rule will only III. Determination To Issue Final Rule with foreign-based enterprises. change the allocation of the burden of D. Unfunded Mandates Reform Act. proof in one kind of proceeding under The Department has determined that In accordance with the Unfunded SMCRA; it will not require the public to prior publication of a proposed rule to Mandates Reform Act (2 U.S.C. 1531 et provide information. amend 43 CFR 4.1307 is not required by seq.), the Department finds as follows: I. National Environmental Policy Act. the notice and comment provisions of 1. This rule will not have a significant The Department has analyzed this rule the Administrative Procedure Act, 5 or unique effect on state, local, or tribal in accordance with the National U.S.C. 553(b), because an opportunity governments or the private sector. Environmental Policy Act of 1969 was provided to comment on the change

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00033 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66728 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

as proposed in NMA’s petition for digital cable televisions and other continuing effort to reduce paperwork rulemaking (68 FR 13657). unidirectional digital cable products as burdens, invites the general public and ‘‘digital cable ready.’’ The rules also the Office of Management and Budget List of Subjects in 43 CFR Part 4 require cable operators to support (OMB) to comment on the information Administrative practice and operation of unidirectional digital cable collections contained in this Second procedure; Mines; Public lands; Surface products on digital cable systems and Report and Order, as required by the mining. set limits on the levels of content Paperwork Reduction Act of 1995, Dated: , 2003. protection that could be triggered by Public Law 104–13. Public and agency P. Lynn Scarlett, MVPDs. This action is taken to further comments are due , 2004. the digital television transition and the In addition to filing comments with Assistant Secretary—Policy, Management the Secretary, a copy of any PRA and Budget. commercial availability of navigation devices pursuant to section 629 of the comments on the information ■ For the reasons set forth in the Communications Act. collections contained herein should be preamble, part 4, subpart L, of title 43 of DATES: Effective December 29, 2003, submitted to Leslie Smith, Federal the Code of Federal Regulations is except for §§ 15.123, 76.1905, and Communications Commission, Room 1– amended as set forth below: 76.1906 which contains information A804, 445 12th Street, SW., Washington, DC 20554, or via the PART 4—[AMENDED] collection requirements that are not effective until approved by the Office of Internet to [email protected], and to Subpart L—Special Rules Applicable Management and Budget. The FCC will Kim A. Johnson, OMB Desk Officer, to Surface Coal Mining Hearings and publish a document in the Federal Room 10236 NEOB, 725 17th Street, Appeals Register announcing the effective date NW., Washington, DC 20503, or via the Internet to for those sections. The incorporation by _ _ ■ 1. The authority for 43 CFR part 4 reference of certain publications listed Kim A. [email protected]. subpart L continues to read as follows: in the regulations is approved by the Summary of the Second Report and Authority: 30 U.S.C. 1256, 1260, 1261, Director of the Federal Register, as of Order 1264, 1268, 1271, 1272, 1275, 1293; 5 U.S.C. December 29, 2003, except for the 301. 1. In the Second Report and Order incorporation by reference in § 15.123 portion of this Second Report and Order ■ 2. In § 4.1307, revise paragraphs (b) which will be approved as of the and Second Further Notice of Proposed and (c) to read as follows: effective date announced in the Federal Rulemaking, the Commission is Register. § 4.1307 Elements; burden of proof. adopting final rules that set technical FOR FURTHER INFORMATION CONTACT: and other criteria that manufacturers * * * * * Susan Mort, [email protected], (202) would have to meet in order to label or (b) The individual shall have the 418–1043. For additional information market unidirectional digital cable ultimate burden of persuasion by a concerning the information collection(s) televisions and other unidirectional preponderance of the evidence as to the contained in this document, contact digital cable products as ‘‘digital cable elements set forth in paragraph (a)(1) of Leslie Smith, Federal Communications ready.’’ This regime includes testing and this section. Commission, Room 1–A804, 445 12th self-certification standards. The final (c) OSM shall have the ultimate Street, SW., Washington, DC 20554, or rules also require consumer information burden of persuasion by a via the Internet at [email protected]., disclosures to purchasers of preponderance of the evidence as to the or at 202–418–0217. unidirectional digital cable televisions elements set forth in paragraphs (a)(2) SUPPLEMENTARY INFORMATION: This is a receivers in appropriate post-sale and (a)(3) of this section and as to the summary of the Federal materials that describe the functionality amount of the individual civil penalty. Communications Commission’s Second of these devices and the need to obtain [FR Doc. 03–29695 Filed 11–26–03; 8:45 am] Report and Order and Second Further a security module from their cable BILLING CODE 4310–79–P Notice of Proposed Rulemaking, FCC operator. Cable operators with digital 03–225, adopted on , 2003, systems of 750 MHz or greater activated and released on , 2003. The channel capacity will be required to FEDERAL COMMUNICATIONS full text of this document is available for support operation of unidirectional COMMISSION inspection and copying during normal digital cable products on digital cable business hours in the FCC Reference systems. Certain other technical support 47 CFR Parts 15 and 76 Center, 445 12th Street, SW., requirements apply to all digital cable Washington, DC 20554. The complete systems, regardless of channel capacity, [CS Docket No. 97–80; PP Docket No. 00– text may be purchased from the including those systems whole only 67; FCC 03–225] Commission’s copy contractor, Qualex digital programming comes from HITS. Commercial Availability of Navigation International, 445 12th Street, SW., In addition, all cable operators will be Devices and Compatibility Between Room CY–B402, Washington, DC 20554. required to supply digital subscribers Cable Systems and Consumer The full text may also be downloaded with point-of-deployment modules Electronics Equipment at: www.fcc.gov. Alternative formats are (‘‘PODs’’) and high definition set-top available to persons with disabilities by boxes that comply with certain AGENCY: Federal Communications contacting Brian Millin at (202) 418– technical standards by , 2004 and Commission. 7426 or TTY (202) 418–7365 or at July 1, 2005 deadlines. Finally, all ACTION: Final rule. [email protected]. MVPDs would be prohibited from encoding content to activate selectable SUMMARY: In this document the Paperwork Reduction Act output controls on consumer premises Commission adopts rules that set The Second Report and Order portion equipment, or the down-resolution of technical and other criteria that of this document contains either a new unencrypted broadcast television manufacturers would have to meet in or modified information collection(s). programming. MVPDs would also be order to label or market unidirectional The Commission, as part of its limited in the levels of copy protection

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00034 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66729

that could be applied to various such a standard has been identified as compliance impacts in this FRFA in categories of programming. a key impediment to the anticipated rate below. 2. Paperwork Reduction Act: This and scope of the transition to digital 8. Description and Estimate of the Second Report and Order contains television (‘‘DTV’’). Such a standard Number of Small Entities to Which the either a new or modified information would allow consumers to directly Proposed Rules Will Apply. The RFA collection(s). The Commission, as part attach their DTV receivers to cable directs the Commission to provide a of its continuing effort to reduce systems and receive certain cable description of and, where feasible, an paperwork burdens, invites the general television services without the need for estimate of the number of small entities public to comment on the information an external navigation device. Since that will be affected by the proposed collection(s) contained in this Second more than sixty percent of television rules. The RFA generally defines the Report and Order as required by the households subscribe to cable term ‘‘small entity’’ as encompassing the Paperwork Reduction Act of 1995, programming services, the availability terms ‘‘small business,’’ ‘‘small Public Law 104–13. Public and agency of digital cable television receivers and organization,’’ and ‘‘small governmental comments are due January 27, 2004. entity.’’ In addition, the term ‘‘small products would encourage more 3. Final Regulatory Flexibility business’’ has the same meaning as the consumers to convert to DTV, thereby Analysis: As required by the Regulatory term ‘‘small business concern’’ under furthering the transition. Private Flexibility Act, the Commission has the Small Business Act. A small prepared a Final Regulatory Flexibility industry negotiations between cable business concern is one which: (1) Is Analysis (‘‘FRFA’’) relating to this operators and consumer electronics independently owned and operated; (2) Second Report and Order. The FRFA is manufacturers resulted in a is not dominant in its field of operation; set forth within. Memorandum of Understanding and (3) satisfies any additional criteria 4. Ordering Clauses: It is ordered that (‘‘MOU’’) on a cable compatibility established by the Small Business pursuant to the authority contained in standard for an integrated, Administration (‘‘SBA’’). sections 1, 4(i) and (j), 303, 403, 601, unidirectional digital cable television 9. Television Broadcasting. The Small 624A and 629 of the Communications receiver, as well as for other Business Administration defines a Act of 1934, 47 U.S.C 151, 154(i) and (j), unidirectional digital cable products. television broadcasting station that has 303, 403, 521, 544a and 549, that the The MOU requires the consumer no more than $12 million in annual Commission’s rules are hereby amended electronics and cable television receipts as a small business. Business as set forth herein, and shall become industries to each commit to certain concerns included in this industry are effective December 29, 2003, except that voluntary acts and sought the creation those ‘‘primarily engaged in §§ 15.123, 76.1905, and 76.1906 that or revision of certain relevant broadcasting images together with contain information collection Commission rules. The objective of the sound.’’ According to Commission staff requirements under the PRA is not final rules, as set forth in the Second review of the BIA Publications, Inc. effective until approved by OMB. The Report and Order portion of the Second Master Access Television Analyzer FCC will publish a document in the Report and Order and Further Notice of Database as of , 2003, about 814 Federal Register announcing the Proposed Rulemaking (‘‘Second Report of the 1,220 commercial television effective date for those sections. The and Order’’), is to facilitate the DTV stations in the United States have Commission’s Consumer and transition. revenues of $12 million or less. We Governmental Affairs Bureau, Reference 7. Summary of Significant Issues note, however, that, in assessing whether a business concern qualifies as Information Center, shall send a copy of Raised by Public Comments in Response small under the above definition, this Second Report and Order, to the IRFA. The Commission received including the Final Regulatory business (control) affiliations must be comments from the American Cable Flexibility Analysis, to the Chief included. Our estimate, therefore, likely Association (‘‘ACA’’) in response to the Counsel for Advocacy of the Small overstates the number of small entities IRFA accompanying the FNPRM. In Business Administration. that might be affected by our action, these comments, ACA expresses its because the revenue figure on which it Final Regulatory Flexibility Analysis support for the Commission’s efforts to is based does not include or aggregate 5. As required by the Regulatory advance the DTV transition, but asks revenues from affiliated companies. Flexibility Act of 1980, as amended that the Commission take into account There are also 2,127 low power (‘‘RFA’’) an Initial Regulatory Flexibility the special circumstances of smaller television stations (LPTV). Given the Analysis (‘‘IRFA’’) was incorporated in cable companies in this proceeding. nature of this service, we will presume the Further Notice of Proposed Specifically, ACA asks that the that all LPTV licensees qualify as small Rulemaking (‘‘FNPRM’’). The Commission consider: (1) the costs of entities under the SBA definition. Commission sought written public compliance for smaller cable systems, 10. In addition, an element of the comment on the proposals in the (2) how plug-and-play requirements definition of ‘‘small business’’ is that the FNPRM, including comment on the might affect smaller cable systems that entity not be dominant in its field of IRFA. Comments were received on the use Comcast’s Headend-in-the-Sky operation. We are unable at this time to IRFA. This present Final Regulatory (‘‘HITS’’) programming, and (3) why define or quantify the criteria that Flexibility Analysis (‘‘FRFA’’) conforms some of the plug-and-play requirements would establish whether a specific to the RFA. are limited to systems having 750 MHz television station is dominant in its field 6. Need for, and Objectives of, the activated channel capacity or higher, of operation. Accordingly, the estimate Second Report and Order and Second while other requirements apply to all of small businesses to which rules may Further Notice of Proposed Rulemaking. digital cable systems. To the extent that apply do not exclude any television The need for FCC regulation in this area the Commission determines that there station from the definition of a small derives from the lack of a so-called cable would be a disparate cost impact upon business on this basis and are therefore compatibility ‘‘plug and play’’ standard small cable systems, ACA asks that the over-inclusive to that extent. Also as for a digital cable television receiver and Commission consider waivers and an noted, an additional element of the related digital cable television consumer extended phase-in for small system definition of ‘‘small business’’ is that the electronics equipment. The absence of compliance. We have discussed entity must be independently owned

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00035 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66730 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

and operated. We note that it is difficult not exceed $250 million in the affords them access to most of the same at times to assess these criteria in the aggregate. Based on available data, we programming provided to subscribers of context of media entities and our find that the number of cable operators other MVPDs; (2) viewers who receive estimates of small businesses to which serving 685,000 subscribers or less totals only non-subscription programming; they apply may be over-inclusive to this approximately 1,450. Although it seems and (3) viewers who receive satellite extent. certain that some of these cable system programming services illegally without 11. Cable and Other Program operators are affiliated with entities subscribing. Because scrambled Distribution. The SBA has developed a whose gross annual revenues exceed packages of programming are most small business size standard for cable $250,000,000, we are unable at this time specifically intended for retail and other program distribution services, to estimate with greater precision the consumers, these are the services most which includes all such companies number of cable system operators that relevant to this discussion. generating $12.5 million or less in would qualify as small cable operators 16. Multipoint Distribution Service revenue annually. This category under the definition in the (‘‘MDS’’), Multichannel Multipoint includes, among others, cable operators, Communications Act. Distribution Service (‘‘MMDS’’) direct broadcast satellite (‘‘DBS’’) 14. Direct Broadcast Satellite (‘‘DBS’’) Instructional Television Fixed Service services, home satellite dish (‘‘HSD’’) Service. Because DBS provides (‘‘ITFS’’) and Local Multipoint services, multipoint distribution subscription services, DBS falls within Distribution Service (‘‘LMDS’’). MMDS services (‘‘MDS’’), multichannel the SBA-recognized definition of cable systems, often referred to as ‘‘wireless multipoint distribution service and other program distribution services. cable,’’ transmit video programming to (‘‘MMDS’’), Instructional Television This definition provides that a small subscribers using the microwave Fixed Service (‘‘ITFS’’), local multipoint entity is one with $12.5 million or less frequencies of the MDS and ITFS. LMDS distribution service (‘‘LMDS’’), satellite in annual receipts. There are four is a fixed broadband point-to-multipoint master antenna television (‘‘SMATV’’) licensees of DBS services under Part 100 microwave service that provides for systems, and open video systems of the Commission’s Rules. Three of two-way video telecommunications. (‘‘OVS’’). According to the Census those licensees are currently 17. In connection with the 1996 MDS Bureau data, there are 1,311 total cable operational. Two of the licensees that auction, the Commission defined small and other pay television service firms are operational have annual revenues businesses as entities that had annual that operate throughout the year of that may be in excess of the threshold average gross revenues of less than $40 which 1,180 have less than $10 million for a small business. The Commission, million in the previous three calendar in revenue. We address below each however, does not collect annual years. This definition of a small entity service individually to provide a more revenue data for DBS and, therefore, is in the context of MDS auctions has been precise estimate of small entities. unable to ascertain the number of small approved by the SBA. The MDS 12. Cable Operators. The Commission DBS licensees that could be impacted by auctions resulted in 67 successful has developed, with SBA’s approval, these proposed rules. DBS service bidders obtaining licensing our own definition of a small cable requires a great investment of capital for opportunities for 493 Basic Trading system operator for the purposes of rate operation, and we acknowledge, despite Areas (‘‘BTAs’’). Of the 67 auction regulation. Under the Commission’s the absence of specific data on this winners, 61 met the definition of a small rules, a ‘‘small cable company’’ is one point, that there are entrants in this field business. MDS also includes licensees serving fewer than 400,000 subscribers that may not yet have generated $12.5 of stations authorized prior to the nationwide. We last estimated that there million in annual receipts, and therefore auction. As noted, the SBA has were 1,439 cable operators that qualified may be categorized as a small business, developed a definition of small entities as small cable companies. Since then, if independently owned and operated. for pay television services, which some of those companies may have 15. Home Satellite Dish (‘‘HSD’’) includes all such companies generating grown to serve over 400,000 subscribers, Service. Because HSD provides $12.5 million or less in annual receipts. and others may have been involved in subscription services, HSD falls within This definition includes multipoint transactions that caused them to be the SBA-recognized definition of cable distribution services, and thus applies combined with other cable operators. and other program distribution services. to MDS licensees and wireless cable Consequently, we estimate that there are This definition provides that a small operators that did not participate in the fewer than 1,439 small entity cable entity is one with $12.5 million or less MDS auction. Information available to system operators that may be affected by in annual receipts. The market for HSD us indicates that there are the decisions and rules proposed in this service is difficult to quantify. Indeed, approximately 850 of these licensees Second Report and Order. the service itself bears little resemblance and operators that do not generate 13. The Communications Act, as to other MVPDs. HSD owners have revenue in excess of $12.5 million amended, also contains a size standard access to more than 265 channels of annually. Therefore, for purposes of the for a small cable system operator, which programming placed on C-band IRFA, we find there are approximately is ‘‘a cable operator that, directly or satellites by programmers for receipt 850 small MDS providers as defined by through an affiliate, serves in the and distribution by MVPDs, of which the SBA and the Commission’s auction aggregate fewer than 1% of all 115 channels are scrambled and rules. subscribers in the United States and is approximately 150 are unscrambled. 18. The SBA definition of small not affiliated with any entity or entities HSD owners can watch unscrambled entities for cable and other program whose gross annual revenues in the channels without paying a subscription distribution services, which includes aggregate exceed $250,000,000.’’ The fee. To receive scrambled channels, such companies generating $12.5 Commission has determined that there however, an HSD owner must purchase million in annual receipts, seems are 68,500,000 subscribers in the United an integrated receiver-decoder from an reasonably applicable to ITFS. There are States. Therefore, an operator serving equipment dealer and pay a presently 2,032 ITFS licensees. All but fewer than 685,000 subscribers shall be subscription fee to an HSD 100 of these licenses are held by deemed a small operator if its annual programming package. Thus, HSD users educational institutions. Educational revenues, when combined with the total include: (1) viewers who subscribe to a institutions are included in the annual revenues of all of its affiliates, do packaged programming service, which definition of a small business. However,

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00036 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66731

we do not collect annual revenue data not required to file financial data with equipment manufacturer must have 750 for ITFS licensees, and are not able to the Commission. Furthermore, we are or fewer employees in order to qualify ascertain how many of the 100 non- not aware of any privately published as a small business concern. Census educational licensees would be financial information regarding these Bureau data indicates that there are 554 categorized as small under the SBA operators. Based on the estimated U.S. establishments that manufacture definition. Thus, we tentatively number of operators and the estimated audio and visual equipment, and that conclude that at least 1,932 licensees are number of units served by the largest 542 of these establishments have fewer small businesses. ten SMATVs, we believe that a than 500 employees and would be 19. Additionally, the auction of the substantial number of SMATV operators classified as small entities. The 1,030 LMDS licenses began on February qualify as small entities remaining 12 establishments have 500 18, 1998, and closed on , 1998. 22. Open Video Systems (‘‘OVS’’). or more employees; however, we are The Commission defined ‘‘small entity’’ Because OVS operators provide unable to determine how many of those for LMDS licenses as an entity that has subscription services, OVS falls within have fewer than 750 employees and average gross revenues of less than $40 the SBA-recognized definition of cable therefore, also qualify as small entities million in the three previous calendar and other program distribution services. under the SBA definition. Under the years. An additional classification for This definition provides that a small SBA’s regulations, a radio and television ‘‘very small business’’ was added and is entity is one with $12.5 million or less broadcasting and wireless defined as an entity that, together with in annual receipts. The Commission has communications equipment its affiliates, has average gross revenues certified 25 OVS operators with some manufacturer must also have 750 or of not more than $15 million for the now providing service. Affiliates of fewer employees in order to qualify as preceding calendar years. These Residential Communications Network, a small business concern. Census regulations defining ‘‘small entity’’ in Inc. (‘‘RCN’’) received approval to Bureau data indicates that there 1,215 the context of LMDS auctions have been operate OVS systems in New York City, U.S. establishments that manufacture approved by the SBA. There were 93 Boston, Washington, D.C. and other radio and television broadcasting and winning bidders that qualified as small areas. RCN has sufficient revenues to wireless communications equipment, entities in the LMDS auctions. A total of assure us that they do not qualify as and that 1,150 of these establishments 93 small and very small business small business entities. Little financial have fewer than 500 employees and bidders won approximately 277 A Block information is available for the other would be classified as small entities. licenses and 387 B Block licenses. On entities authorized to provide OVS that The remaining 65 establishments have , 1999, the Commission re- are not yet operational. Given that other 500 or more employees; however, we auctioned 161 licenses; there were 40 entities have been authorized to provide are unable to determine how many of winning bidders. Based on this OVS service but have not yet begun to those have fewer than 750 employees information, we conclude that the generate revenues, we conclude that at and therefore, also qualify as small number of small LMDS licenses will least some of the OVS operators qualify entities under the SBA definition. We include the 93 winning bidders in the as small entities. therefore conclude that there are no first auction and the 40 winning bidders 23. Electronics Equipment more than 542 small manufacturers of in the re-auction, for a total of 133 small Manufacturers. Rules adopted in this audio and visual electronics equipment entity LMDS providers as defined by the proceeding could apply to and no more than 1,150 small SBA and the Commission’s auction manufacturers of DTV receiving manufacturers of radio and television rules. equipment and other types of consumer broadcasting and wireless 20. In sum, there are approximately a electronics equipment. The SBA has communications equipment for total of 2,000 MDS/MMDS/LMDS developed definitions of small entity for consumer/household use. stations currently licensed. Of the manufacturers of audio and video 24. Computer Manufacturers. The approximate total of 2,000 stations, we equipment as well as radio and Commission has not developed a estimate that there are 1,595 MDS/ television broadcasting and wireless definition of small entities applicable to MMDS/LMDS providers that are small communications equipment. These computer manufacturers. Therefore, we businesses as deemed by the SBA and categories both include all such will utilize the SBA definition of the Commission’s auction rules. companies employing 750 or fewer electronic computers manufacturing. 21. Satellite Master Antenna employees. The Commission has not According to SBA regulations, a Television (‘‘SMATV’’) Systems. The developed a definition of small entities computer manufacturer must have 1,000 SBA definition of small entities for applicable to manufacturers of or fewer employees in order to qualify cable and other program distribution electronic equipment used by as a small entity. Census Bureau data services includes SMATV services and, consumers, as compared to industrial indicates that there are 563 firms that thus, small entities are defined as all use by television licensees and related manufacture electronic computers and such companies generating $12.5 businesses. Therefore, we will utilize of those, 544 have fewer than 1,000 million or less in annual receipts. the SBA definitions applicable to employees and qualify as small entities. Industry sources estimate that manufacturers of audio and visual The remaining 19 firms have 1,000 or approximately 5,200 SMATV operators equipment and radio and television more employees. We conclude that were providing service as of December broadcasting and wireless there are approximately 544 small 1995. Other estimates indicate that communications equipment, since these computer manufacturers. SMATV operators serve approximately are the two closest NAICS Codes 25. Description of Projected 1.5 million residential subscribers as of applicable to the consumer electronics Reporting, Recordkeeping and other July 2001. The best available estimates equipment manufacturing industry. Compliance Requirements. The final indicate that the largest SMATV However, these NAICS categories are rules set technical and other criteria that operators serve between 15,000 and broad and specific figures are not manufacturers would have to meet in 55,000 subscribers each. Most SMATV available as to how many of these order to label or market unidirectional operators serve approximately 3,000– establishments manufacture consumer digital cable televisions and other 4,000 customers. Because these equipment. According to the SBA’s unidirectional digital cable products as operators are not rate regulated, they are regulations, an audio and visual ‘‘digital cable ready.’’ This regime

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00037 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66732 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

includes testing and self-certification 28. The record in this proceeding did PART 15—RADIO FREQUENCY standards. The final rules also require not provide the Commission with DEVICES consumer information disclosures to detailed cost information on the digital purchasers of unidirectional digital cable system support requirements. In ■ 1. The authority for part 15 continues cable televisions receivers in an effort to take into account the to read as follows: appropriate post-sale materials that concerns of small cable systems, the Authority: 47 U.S.C. 154, 302, 303, 304, describe the functionality of these Commission has indicated that it will 307, 336, and 544a. devices and the need to obtain a consider waiver requests for these ■ 2. Amend § 15.19 by revising security module from their cable requirements on a case-by-case basis. As paragraph (d) to read as follows: operator. Cable operators with digital to the POD-provisioning mandate, cable systems of 750 MHz or greater activated operators are already required to § 15.19 Labelling requirements. channel capacity will be required to provide PODs to subscribers by request. * * * * * support operation of unidirectional We therefore do not believe that the new (d) Consumer electronics TV receiving digital cable products on digital cable provisioning requirements will have a devices, including TV receivers, systems. Certain other technical support significant impact on small cable videocassette recorders, and similar requirements apply to all digital cable systems. Likewise, we anticipate that devices, that incorporate features systems, regardless of channel capacity, the upcoming high definition set-top intended to be used with cable including those systems whose only box deadlines will not negatively television service, but do not fully digital programming comes from HITS. impact small operators since the 2004 comply with the technical standards for In addition, all cable operators will be deadline only applies to output cable ready equipment set forth in required to supply digital subscribers upgrades upon subscriber request, and § 15.118, shall not be marketed with with point-of-deployment modules the 2005 deadline will only apply to terminology that describes the device as (‘‘PODs’’) and high definition set-top inventory acquired after that date. ‘‘cable ready’’ or ‘‘cable compatible,’’ or boxes that comply with certain 29. Finally, we anticipate that the that otherwise conveys the impression technical standards by April 1, 2004 and encoding prohibitions on selectable that the device is fully compatible with July 1, 2005 deadlines. Finally, all output controls and the down-resolution cable service. Factual statements about MVPDs would be prohibited from of unencrypted broadcast programming the various features of a device that are encoding content to activate selectable will largely impact upon the DBS intended for use with cable service or output controls on consumer premises industry, which is primarily composed the quality of such features are equipment, or the down-resolution of of large entities. While the caps on copy acceptable so long as such statements do unencrypted broadcast television protection will affect all MVPDs, we do not imply that the device is fully programming. MVPDs would also be not believe they will negatively impact compatible with cable service. limited in the levels of copy protection small entities. Statements relating to product features that could be applied to various are generally acceptable where they are categories of programming. 30. Federal Rules Which Duplicate, Overlap, or Conflict with the limited to one or more specific features 26. Steps Taken to Minimize Commission’s Proposals. None. of a device, rather than the device as a Significant Impact on Small Entities, whole. This requirement applies to and Significant Alternatives Considered. 31. Report to Congress: The consumer TV receivers, videocassette The RFA requires an agency to describe Commission will send a copy of the recorders and similar devices any significant alternatives that it has Second Report and Order, including this manufactured or imported for sale in considered in reaching its proposed FRFA, in a report to be sent to Congress this country on or after , approach, which may include the pursuant to the Congressional Review 1994. Act. In addition, the Commission will following four alternatives (among ■ 3. Add § 15.38 to subpart A to read as send a copy of the Second Report and others): (1) The establishment of follows: differing compliance or reporting Order, including this FRFA, to the Chief requirements or timetables that take into Counsel for Advocacy of the SBA. A § 15.38 Incorporation by reference. account the resources available to small copy of the Second Report and Order (a) The materials listed in this section entities; (2) the clarification, and FRFA (or summaries thereof) will are incorporated by reference in this consolidation, or simplification of also be published in the Federal part. These incorporations by reference compliance or reporting requirements Register. were approved by the Director of the under the rule for small entities; (3) the List of Subjects Federal Register in accordance with 5 use of performance, rather than design, U.S.C. 552(a) and 1 CFR part 51. These standards; and (4) an exemption from 47 CFR Part 15 materials are incorporated as they exist coverage of the rule, or any part thereof, on the date of the approval, and notice Cable television, Incorporation by for small entities. of any change in these materials will be reference, Television. 27. Because the ‘‘digital cable ready’’ published in the Federal Register. The labeling regime does not require 47 CFR Part 76 materials are available for purchase at manufacturers to affix a label to devices, the corresponding addresses as noted, we do not anticipate that small Cable television, Incorporation by and all are available for inspection at manufacturers will be significantly reference, Recordings, Television. the Office of the Federal Register, 800 affected. Although the consumer Federal Communications Commission. North Capitol Street, NW., suite 700, information disclosure in post-sale is Marlene H. Dortch, Washington, DC, and at the Federal mandatory, we do not believe that it Secretary. Communications Commission, 445 12th. will adversely affect small St., SW., Reference Information Center, manufacturers since they already ■ For the reasons discussed in the Room CY–A257, Washington, DC 20554. include owner’s manuals and other preamble, the Federal Communications (b) The following materials are documentation inside equipment Commission amends 47 CFR parts 15 available for purchase from at least one packaging. and 76 as follows: of the following addresses: Global

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00038 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66733

Engineering Documents, 15 Inverness § 15.123 Labeling of digital cable ready Cable Television’’ (incorporated by Way East, Englewood, CO 80112 or at products. reference, see § 15.38). http://global.ihs.com; or American (a) The requirements of this section (6) In addition to the requirements of National Standards Institute, 25 West shall apply to unidirectional digital paragraphs (b)(1) through (5) of this 43rd Street, 4th Floor, New York, NY cable products. Unidirectional digital section, a unidirectional digital cable 10036 or at http://webstore.ansi.org/ cable products are one-way devices that television may not be labeled or ansidocstore/default.asp; or Society of accept a Point of Deployment module marketed as digital cable ready or with Cable Telecommunications Engineers at (POD) and which include, but are not other terminology as described in http://www.scte.org/standards/ limited to televisions, set-top-boxes and paragraph (b) of this section, unless it index.cfm. recording devices connected to digital includes a DTV broadcast tuner as set (1) SCTE 28 2003 (formerly DVS 295): cable systems. Unidirectional digital forth in § 15.117(i) and employs at least ‘‘Host-POD Interface Standard,’’ 2003, cable products do not include one specified interface in accordance IBR approved for § 15.123. interactive two-way digital television with the following schedule: (2) SCTE 41 2003 (formerly DVS 301): products. (i) For 480p grade unidirectional ‘‘POD Copy Protection System,’’ 2003, (b) A unidirectional digital cable digital cable televisions, either a DVI/ IBR approved for § 15.123. product may not be labeled with or HDCP, HDMI/HDCP, or 480p Y,Pb,Pr (3) ANSI/SCTE 54 2003 (formerly marketed using the term ‘‘digital cable interface: DVS 241): ‘‘Digital Video Service ready,’’ or other terminology that (A) Models with screen sizes 36 Multiplex and Transport System describes the device as ‘‘cable ready’’ or inches and above: 50% of a Standard for Cable Television,’’ 2003, ‘‘cable compatible,’’ or otherwise manufacturer’s or importer’s models IBR approved for § 15.123. indicates that the device accepts a POD manufactured or imported after July 1, (4) ANSI/SCTE 65 2002 (formerly or conveys the impression that the 2004; 100% of such models DVS 234): ‘‘Service Information device is compatible with digital cable manufactured or imported after July 1, Delivered Out-of-Band for Digital Cable service unless it implements at a 2005. Television,’’ 2002, IBR approved for minimum the following features: (B) Models with screen sizes 32 to 35 § 15.123. (1) Tunes NTSC analog channels inches: 50% of a manufacturer’s or (5) SCTE 40 2003 (formerly DVS 313): transmitted in-the-clear. importer’s models manufactured or ‘‘Digital Cable Network Interface (2) Tunes digital channels that are imported after July 1, 2005; 100% of Standard,’’ 2003, IBR approved for transmitted in compliance with SCTE such models manufactured or imported § 15.123. 40 2003 (formerly DVS 313): ‘‘Digital after July 1, 2006. (6) ANSI C63.4–1992: ‘‘Methods of Cable Network Interface Standard’’ (ii) For 720p/1080i grade Measurement of Radio-Noise Emissions (incorporated by reference, see § 15.38), unidirectional digital cable televisions, from Low-Voltage Electrical and provided, however, that with respect to either a DVI/HDCP or HDMI/HDCP Electronic Equipment in the Range of 9 Table B.11 of that standard, the phase interface: kHz to 40 GHz,’’ 1992, IBR approved for noise requirement shall be –86 dB/Hz (A) Models with screen sizes 36 § 15.31, except for sections 5.7, 9 and including both in-the-clear channels inches and above: 50% of a 14. and channels that are subject to manufacturer’s or importer’s models (7) EIA IS–132: ‘‘Cable Television conditional access. manufactured or imported after July 1, Channel Identification Plan,’’ 1994, IBR (3) Allows navigation of channels 2004; 100% of such models approved for § 15.118. based on channel information (virtual manufactured or imported after July 1, (8) EIA–608: ‘‘Recommended Practice channel map and source names) 2005. for Line 21 Data Service,’’ 1994, IBR provided through the cable system in (B) Models with screen sizes 25 to 35 approved for § 15.120. compliance with ANSI/SCTE 65 2002 inches: 50% of a manufacturer’s or (9) EIA–744: ‘‘Transport of Content (formerly DVS 234): ‘‘Service importer’s models manufactured or Advisory Information Using Extended Information Delivered Out-of-Band for imported after July 1, 2005; 100% of Data Service (XDS),’’ 1997, IBR Digital Cable Television’’ (incorporated such models manufactured or imported approved for § 15.120. by reference, see § 15.38), and/or PSIP- after July l, 2006. (10) EIA–708–B: ‘‘Digital Television enabled navigation (ANSI/SCTE 54 2003 (C) Models with screen sizes 13 to 24 (DTV) Closed Captioning,’’ 1999, IBR (formerly DVS 241): ‘‘Digital Video inches: 100% of a manufacturer’s or approved for § 15.122. Service Multiplex and Transport System importer’s models manufactured or (11) Third Edition of the International Standard for Cable Television’’ imported after July 1, 2007. Special Committee on Radio (incorporated by reference, see § 15.38)). (c) Before a manufacturer’s or Interference (CISPR), Pub. 22, (4) Includes the POD-Host Interface importer’s first unidirectional digital ‘‘Information Technology Equipment— specified in SCTE 28 2003 (formerly cable product may be labeled or Radio Disturbance Characteristics— DVS 295): ‘‘Host-POD Interface marketed as digital cable ready or with Limits and Methods of Measurement,’’ Standard’’ (incorporated by reference, other terminology as described in 1997, IBR approved for § 15.109. see § 15.38), and SCTE 41 2003 paragraph (b) of this section, the (c) The following materials are freely (formerly DVS 301): ‘‘POD Copy manufacturer or importer shall verify available from at least one of the Protection System’’ (incorporated by the device as follows: following addresses: Consumer reference, see § 15.38), or (1) The manufacturer or importer Electronics Association, 2500 Wilson implementation of a more advanced shall have a sample of its first model of Blvd., Arlington, VA 22201 or at http:/ POD-Host Interface based on successor a unidirectional digital cable product /www.ce.org/publicpolicy: Uni-Dir- standards. Support for Internet protocol tested to show compliance with the PICS–I01–030903: ‘‘Uni-Directional flows is not required. procedures set forth in Uni–Dir–PICS– Receiving Device: Conformance (5) Responds to emergency alerts that I01–030903: ‘‘Uni-Directional Receiving Checklist: PICS Proforma,’’ 2003, IBR are transmitted in compliance with Device: Conformance Checklist: PICS approved for § 15.123. ANSI/SCTE 54 2003 (formerly DVS Proforma’’ (incorporated by reference, ■ 4. Add § 15.123 to subpart B to read as 241): ‘‘Digital Video Service Multiplex see § 15.38) at a qualified test facility. follows: and Transport System Standard for The manufacturer or importer shall have

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00039 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66734 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

any modifications to the product to view encrypted digital programming. (4) ANSI/SCTE 54 2003 (formerly correct failures of the procedures in Certain advanced and interactive digital DVS 241), ‘‘Digital Video Service Uni–Dir–PICS–I01–030903: ‘‘Uni- cable services such as video-on-demand, Multiplex and Transport System Directional Receiving Device: a cable operator’s enhanced program Standard for Cable Television,’’ 2003, Conformance Checklist: PICS Proforma’’ guide and data-enhanced television IBR approved for § 76.640. (incorporated by reference, see § 15.38) services may require the use of a set-top (5) ANSI/SCTE 65 2002 (formerly retested at a qualified test facility. box. For more information call your DVS 234), ‘‘Service Information (2) A qualified test facility is a facility local cable operator.’’ Delivered Out-of-Band for Digital Cable representing cable television system Television,’’ 2002, IBR approved for operators serving a majority of the cable PART 76—MULTICHANNEL VIDEO § 76.640. television subscribers in the United AND CABLE TELEVISION SERVICE (6) CEA–931–A, ‘‘Remote Control States or an independent laboratory ■ Command Pass-through Standard for with personnel knowledgeable with 5. The authority citation for part 76 continues to read as follows: Home Networking,’’ 2003, IBR approved respect to the standards referenced in for § 76.640. paragraph (b) of this section concerning Authority: 47 U.S.C. 151, 152, 153, 154, (7) SCTE 40 2003 (formerly DVS 313), the procedures set forth in Uni–Dir– 301, 302, 303, 303a, 307, 308, 309, 312, 317, 325, 338, 339, 503, 521, 522, 531, 532, 533, ‘‘Digital Cable Network Interface PICS–I01–030903: ‘‘Uni-Directional Standard,’’ 2003, IBR approved for Receiving Device: Conformance 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549, 552, 554, 556, 558, 560, 531, 571, 572, § 76.640. Checklist: PICS Proforma’’ (incorporated and 573. (8) ATSC A/65B: ‘‘ATSC Standard: by reference, see § 15.38). ■ Program and System Information (3) Subsequent to the testing of its 6. Add § 76.602 to subpart K to read as Protocol for Terrestrial Broadcast and initial unidirectional digital cable follows: Cable (Revision B),’’ , 2003, product model, a manufacturer or § 76.602 Incorporation by reference. IBR approved for § 76.640. importer is not required to have other (a) The materials listed in this section (9) EIA IS–132: ‘‘Cable Television models of unidirectional digital cable are incorporated by reference in this Channel Identification Plan,’’ 1994, IBR products tested at a qualified test part. These incorporations by reference approved for § 76.605. facility for compliance with the were approved by the Director of the ■ 7. Add § 76.640 to subpart B to read as procedures of Uni–Dir–PICS–I01– Federal Register in accordance with 5 follows: 030903: ‘‘Uni-Directional Receiving U.S.C. 552(a) and 1 CFR part 51. These Device: Conformance Checklist: PICS materials are incorporated as they exist § 76.640 Support for unidirectional digital Proforma’’ (incorporated by reference, on the date of the approval, and notice cable products on digital cable systems. see § 15.38). However, the manufacturer of any change in these materials will be (a) The requirements of this section or importer shall ensure that all published in the Federal Register. The subsequent models of unidirectional shall apply to digital cable systems. For materials are available for purchase at purposes of this section, digital cable digital cable products comply with the the corresponding addresses as noted, procedures in the Uni–Dir–PICS–I01– systems shall be defined as a cable and all are available for inspection at system with one or more channels 030903: ‘‘Uni-Directional Receiving the Office of the Federal Register, 800 Device: Conformance Checklist: PICS utilizing QAM modulation for North Capitol Street, NW., suite 700, transporting programs and services from Proforma’’ (incorporated by reference, Washington, DC, and at the Federal see § 15.38) and all other applicable its headend to receiving devices. Cable Communications Commission, 445 12th. systems that only pass through 8 VSB rules and standards. The manufacturer St., SW., Reference Information Center, or importer shall maintain records broadcast signals shall not be Room CY–A257, Washington, DC 20554. considered digital cable systems. indicating such compliance in (b) The following materials are (b) No later than July 1, 2004, cable accordance with the verification available for purchase from at least one operators shall support unidirectional procedure requirements in part 2, of the following addresses: Global digital cable products, as defined in subpart J of this chapter. The Engineering Documents, 15 Inverness § 15.123 of this chapter, through the manufacturer or importer shall further Way East, Englewood, CO 80112 or at provisioning of Point of Deployment submit documentation verifying http://global.ihs.com; or American compliance with the procedures in the National Standards Institute, 25 West modules (PODs) and services, as Uni–Dir–PICS–I01–030903: ‘‘Uni- 43rd Street, 4th Floor, New York, NY follows: Directional Receiving Device: 10036 or at http://webstore.ansi.org/ (1) Digital cable systems with an Conformance Checklist: PICS Proforma’’ ansidocstore/default.asp; or Society of activated channel capacity of 750 MHz (incorporated by reference, see § 15.38) Cable Telecommunications Engineers at or greater shall comply with the to a facility representing cable television http://www.scte.org/standards/ following technical standards and system operators serving a majority of index.cfm; or Advanced Television requirements: the cable television subscribers in the Systems Committee, 1750 K Street, NW., (i) SCTE 40 2003 (formerly DVS 313): United States. Suite 1200, Washington, DC 20006 or at ‘‘Digital Cable Network Interface (d) Manufacturers and importers shall http://www.atsc.org/standards. Standard’’ (incorporated by reference, provide in appropriate post-sale (1) ANSI/SCTE 26 2001 (formerly see § 76.602), provided however that material that describes the features and DVS 194): ‘‘Home Digital Network with respect to Table B.11, the Phase functionality of the product, such as the Interface Specification with Copy Noise requirement shall be ¥86 dB/Hz, owner’s guide, the following language: Protection,’’ 2001, IBR approved for and also provided that the ‘‘transit delay ‘‘This digital television is capable of § 76.640. for most distant customer’’ requirement receiving analog basic, digital basic and (2) SCTE 28 2003 (formerly DVS 295): in Table B.3 is not mandatory. digital premium cable television ‘‘Host-POD Interface Standard,’’ 2003, (ii) ANSI/SCTE 65 2002 (formerly programming by direct connection to a IBR approved for § 76.640. DVS 234): ‘‘Service Information cable system providing such (3) SCTE 41 2003 (formerly DVS 301): Delivered Out-of-Band for Digital Cable programming. A security card provided ‘‘POD Copy Protection System,’’ 2003, Television’’ (incorporated by reference, by your cable operator is required to IBR approved for § 76.640. see § 76.602), provided however that the

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00040 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66735

referenced Source Name Subtable shall (D) Each channel shall be identified referenced in ANSI/SCTE 26 2001 be provided for Profiles 1, 2, and 3. by a one-or two-part channel number (formerly DVS 194): ‘‘Home Digital (iii) ANSI/SCTE 54 2003 (formerly and a textual channel name; and Network Interface Specification with DVS 241): ‘‘Digital Video Service (E) The channel number identified Copy Protection’’ (incorporated by Multiplex and Transport System with out-of-band signaling information reference, see § 76.602)). Standard for Cable Television’’ data should match the channel ■ 8. Add subpart W to read as follows: (incorporated by reference, see identified with in-band PSIP data for all § 76.602). unscrambled in-the-clear services. Subpart W—Encoding Rules (iv) For each digital transport stream (2) All digital cable systems shall comply with: Sec. that includes one or more services (i) SCTE 28 2003 (formerly DVS 295): 76.1901 Applicability. carried in-the-clear, such transport ‘‘Host-POD Interface Standard’’ 76.1902 Definitions. stream shall include virtual channel (incorporated by reference, see 76.1903 Interfaces. data in-band in the form of ATSC A/ 76.1904 Encoding rules for defined § 76.602). business models. 65B: ‘‘ATSC Standard: Program and (ii) SCTE 41 2003 (formerly DVS 301): System Information Protocol for 76.1905 Petitions to modify encoding rules ‘‘POD Copy Protection System’’ for new services within defined business Terrestrial Broadcast and Cable (incorporated by reference, see (Revision B)’’ (incorporated by models. § 76.602). 76.1906 Encoding rules for undefined reference, see § 76.602), when available (3) Cable operators shall ensure, as to business models. from the content provider. With respect all digital cable systems, an adequate 76.1907 Temporary bona fide trials. to in-band transport: supply of PODs that comply with the 76.1908 Certain practices not prohibited. (A) The data shall, at minimum, standards specified in paragraph (b)(2) § 76.1901 Applicability. describe services carried within the of this section to ensure convenient transport stream carrying the PSIP data access to such PODS by customers. (a) Each multi-channel video itself; Without limiting the foregoing, cable programming distributor shall comply (B) PSIP data describing a twelve-hour operators may provide more advanced with the requirements of this subpart. time period shall be carried for each PODs (i.e., PODs that are based on (b) This subpart shall not apply to service in the transport stream. This successor standards to those specified in distribution of any content over the twelve-hour period corresponds to paragraph (b)(2) of this section) to Internet, nor to a multichannel video delivery of the following event customers whose unidirectional digital programming distributor’s operations information tables: EIT–0, –1, –2 and –3; cable products are compatible with the via cable modem or DSL. (C) The format of event information more advanced PODs. (c) With respect to cable system data format shall conform to ATSC A/ (4) Cable operators shall: operators, this subpart shall apply only 65B: ‘‘ATSC Standard: Program and (i) Effective April 1, 2004, upon to cable services. This subpart shall not System Information Protocol for request of a customer, replace any apply to cable modem services, whether Terrestrial Broadcast and Cable leased high definition set-top box, or not provided by a cable system (Revision B)’’ (incorporated by which does not include a functional operator or affiliate. IEEE 1394 interface, with one that reference, see § 76.602); § 76.1902 Definitions. (D) Each channel shall be identified includes a functional IEEE 1394 interface or upgrade the customer’s set- (a) Commercial advertising messages by a one- or two-part channel number shall mean, with respect to any service, and a textual channel name; and top box by download or other means to ensure that the IEEE 1394 interface is program, or schedule or group of (E) The total bandwidth for PSIP data programs, commercial advertising may be limited by the cable system to functional. (ii) Effective July 1, 2005, include messages other than: 80 kbps for a 27 Mbits multiplex and both a DVI or HDMI interface and an (1) Advertising relating to such 115 kbps for a 38.8 Mbits multiplex. IEEE 1394 interface on all high service itself or the programming (v) When service information tables definition set-top boxes acquired by a contained therein, are transmitted out-of-band for cable operator for distribution to (2) Interstitial programming relating to scrambled services: customers. such service itself or the programming (A) The data shall, at minimum, (iii) Ensure that these cable operator- contained therein, or describe services carried within the provided high definition set-top boxes (3) Any advertising which is transport stream carrying the PSIP data shall comply with ANSI/SCTE 26 2001 displayed concurrently with the display itself; (formerly DVS 194): ‘‘Home Digital of any part of such program(s), (B) A virtual channel table shall be Network Interface Specification with including but not limited to ‘‘bugs,’’ provided via the extended channel Copy Protection’’ (incorporated by ‘‘frames’’ and ‘‘banners.’’ interface from the POD module. Tables reference, see § 76.602), with (b) Commercial audiovisual content to be included shall conform to ANSI/ transmission of bit-mapped graphics shall mean works that consist of a series SCTE 65 2002 (formerly DVS 234): optional, and shall support the CEA– of related images which are intrinsically ‘‘Service Information Delivered Out-of- 931–A: ‘‘Remote Control Command intended to be shown by the use of Band for Digital Cable Television’’ Pass-through Standard for Home machines, or devices such as projectors, (incorporated by reference, see Networking’’ (incorporated by reference, viewers, or electronic equipment, § 76.602). see § 76.602), pass through control together with accompanying sounds, if (C) Event information data when commands: tune function, mute any, regardless of the nature of the present shall conform to ANSI/SCTE 65 function, and restore volume function. material objects, such as films or tapes, 2002 (formerly DVS 234): ‘‘Service In addition these boxes shall support in which the works are embodied, Information Delivered Out-of-Band for the power control commands (power on, transmitted by a covered entity and that Digital Cable Television’’ (incorporated power off, and status inquiry) defined in are: by reference, see § 76.602) (profiles 4 or A/VC Digital Interface Command Set (1) Not created by the user of a higher). General Specification Version 4.0 (as covered product, and

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00041 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66736 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

(2) Offered for transmission, either government-mandated fees) for the (1) A subscriber is able, at his or her generally or on demand, to subscribers reception or viewing of the discretion, to select the time for or purchasers or the public at large or programming contained therein, other commencement of exhibition thereof, otherwise for commercial purposes, not than unencrypted broadcast television. (2) Where each such single program is uniquely to an individual or a small, (m) Non-premium subscription generally uninterrupted by commercial private group. television shall mean a service, or advertising messages; and (c) Commercially adopted access schedule or group of programs (which (3) For which program or specified control method shall mean any may be offered for sale together with group of programs subscribing viewers commercially adopted access control other services, or schedule or group of are charged a periodic subscription fee method including digitally controlled programs), for which subscribers are for the reception of programming analog scrambling systems, whether charged a subscription fee for the delivered by such service during the now or hereafter in commercial use. reception or viewing of the specified viewing period covered by the (d) Copy never shall mean, with programming contained therein, other fee. In the event a given delivery of a respect to commercial audiovisual than pay television, subscription-on- program qualifies both as a pay content, the encoding of such content so demand and unencrypted broadcast television transmission and as to signal that such content may not television. By way of example, ‘‘basic subscription-on-demand, then for to be copied by a covered product. cable service’’ and ‘‘extended basic purposes of this subpart, such delivery (e) Copy one generation shall mean, cable service’’ (other than unencrypted shall be deemed subscription-on- with respect to commercial audiovisual broadcast television) are ‘‘non-premium demand rather than a pay television content, the encoding of such content so subscription television.’’ transmission. as to permit a first generation of copies (n) Pay-per-view shall mean a delivery (r) Undefined business model shall to be made by a covered product but not of a single program or a specified group mean a business model that does not fall copies of such first generation of copies. of programs, as to which each such within the definition of a defined (f) Copy no more shall mean, with single program is generally business model. respect to commercial audiovisual uninterrupted by commercial (s) Unencrypted broadcast television content, the encoding of such content so advertising messages and for which means any service, program, or schedule as to reflect that such content is a first recipients are charged a separate fee for or group of programs, that is a further generation copy of content encoded as each program or specified group of transmission of a broadcast transmission copy one generation and no further programs. The term pay-per-view shall (i.e., an over-the-air transmission for copies are permitted. also include delivery of a single reception by the general public using (g) Covered product shall mean a program for which multiple start times radio frequencies allocated for that device used by consumers to access are made available at time intervals purpose) that substantially commercial audiovisual content offered which are less than the running time of simultaneously is made by a terrestrial by a covered entity (excluding delivery such program as a whole. If a given television broadcast station located via cable modem or the Internet); and delivery qualifies both as pay-per-view within the country or territory in which any device to which commercial and a pay television transmission, then, the entity further transmitting such audiovisual content so delivered from for purposes of this subpart, such broadcast transmission also is located, such covered product may be passed, delivery shall be deemed pay-per-view where such broadcast transmission is directly or indirectly. rather than a pay television not subject to a commercially-adopted (h) Covered entity shall mean any access control method (e.g., is broadcast entity that is subject to this subpart. transmission. (o) Pay television transmission shall in the clear to members of the public (i) Defined business model shall mean receiving such broadcasts), regardless of video-on-demand, pay-per view, pay mean a transmission of a service or schedule of programs, as to which each whether such entity subjects such television transmission, non-premium further transmission to an access control subscription television, free conditional individual program is generally uninterrupted by commercial method. access delivery and unencrypted (t) Video-on-demand shall mean a advertising messages and for which broadcast television. delivery of a single program or a service or schedule of programs (j) Encode shall mean, in the specified group of programs for which: subscribing viewers are charged a transmission of commercial audiovisual (1) Each such individual program is periodic subscription fee, such as on a content, to pass, attach, embed, or generally uninterrupted by commercial monthly basis, for the reception of such otherwise apply to, associate with, or advertising messages; allow to persist in or remain associated programming delivered by such service (2) Recipients are charged a separate with such content, data or information whether separately or together with fee for each such single program or which when read or responded to in a other services or programming, during specified group of programs; and covered device has the effect of the specified viewing period covered by (3) A recipient is able, at his or her preventing, pausing, or limiting such fee. If a given delivery qualifies discretion, to select the time for copying, or constraining the resolution both as a pay television transmission commencement of exhibition of such of a program when output from the and pay-per-view, video-on-demand, or individual program or specified group covered device. subscription-on-demand then, for of programs. In the event a delivery (k) Encoding rules shall mean the purposes of this subpart, such delivery qualifies as both video-on-demand and requirements or prohibitions describing shall be deemed pay-per-view, video- a pay television transmission, then for or limiting encoding of audiovisual on-demand or subscription-on-demand purposes of this subpart, such delivery content as set forth in this subpart. rather than a pay television shall be deemed video-on-demand. (l) Free conditional access delivery transmission. shall mean a delivery of a service, (p) Program shall mean any work of § 76.1903 Interfaces. program, or schedule or group of commercial audiovisual content. A covered entity shall not attach or programs via a commercially-adopted (q) Subscription-on-demand shall embed data or information with access control method, where viewers mean the delivery of a single program or commercial audiovisual content, or are not charged any fee (other than a specified group of programs for which: otherwise apply to, associate with, or

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00042 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66737

allow such data to persist in or remain the new service differs from existing (4) Commission determination as to associated with such content, so as to services provided by any covered entity encoding rules for a new service within prevent its output through any analog or under the applicable defined business a defined business model. digital output authorized or permitted model prior to December 31, 2002. (i) Proceedings initiated by petitions under license, law or regulation (b) Petitions. A petition to encode a pursuant to this section shall be permit- governing such covered product. new service within a defined business but-disclose proceedings, unless model other than as permitted by the otherwise specified by the Commission. § 76.1904 Encoding rules for defined encoding rules set forth in The covered entity shall have the business models. § 76.1904(b)(1) and (2) shall describe: burden of proof to establish that the (a) Commercial audiovisual content (1) The defined business model, the proposed change in encoding rules for delivered as unencrypted broadcast new service, and the proposed encoding a new service is in the public interest. television shall not be encoded so as to terms, including the use of copy never In making its determination, the prevent or limit copying thereof by and copy one generation encoding, and Commission shall take into account the covered products or, to constrain the the encoding of content with respect to following factors: resolution of the image when output ‘‘pause’’ set forth in § 76.1904(b)(2). (A) Whether the benefit to consumers from a covered product. (2) Whether the claimed benefit to of the new service, including but not (b) Except for a specific determination consumers of the new service, limited to earlier release windows, more made by the Commission pursuant to a including, but not limited to, the favorable terms, innovation or original petition with respect to a defined availability of content in earlier release programming, outweighs the limitation business model other than unencrypted windows, more favorable terms, on the consumers’ control over the new broadcast television, or an undefined innovation or original programming, service; business model subject to the outweighs the limitation on the (B) Ways in which the new service procedures set forth in § 76.1906: consumers’ control over the new differs from existing services offered by (1) Commercial audiovisual content service; any covered entity within the applicable shall not be encoded so as to prevent or (3) The ways in which the new defined business model prior to limit copying thereof except as follows: service differs from existing services December 31, 2002; and (i) To prevent or limit copying of offered by any covered entity within the (ii) The Commission may specify video-on-demand or pay-per-view applicable defined business model prior other procedures, such as oral argument, transmissions, subject to the to December 31, 2002; evidentiary hearing, or further written requirements of paragraph (b)(2) of this (4) All other pertinent facts and submissions directed to particular section; and considerations relied on to support a aspects, as it deems appropriate. (ii) To prevent or limit copying, other determination that grant of the petition (iii) A petition may, upon request of than first generation of copies, of pay would serve the public interest. the petitioner, be dismissed without television transmissions, non-premium (5) Factual allegations shall be prejudice as a matter of right prior to the subscription television, and free supported by affidavit or declaration of adoption date of any final action taken conditional access delivery a person or persons with actual by the Commission with respect to the transmissions; and knowledge of the facts, and exhibits petition. A petitioner’s request for the (2) With respect to any commercial shall be verified by the person who return of a petition will be regarded as audiovisual content delivered or prepares them. a request for dismissal. transmitted in form of a video-on- (c) Petition process—(1) Public notice. (d) Complaint regarding a new service demand or pay-per-view transmission, a The Commission shall give public not subject to petition. In an instance in covered entity shall not encode such notice of any such petition. which an interested party has a content so as to prevent a covered (2) Comments. Interested persons may substantial basis to believe and does product, without further authorization, submit comments or oppositions to the believe in good faith that a new service from pausing such content up to 90 petition within thirty (30) days after the within a defined business model has minutes from initial transmission by the date of public notice of the filing of such been launched without a petition as covered entity (e.g., frame-by-frame, petition. Comments or oppositions shall required by this section, such party may minute-by-minute, megabyte by be served on the petitioner and on all file a complaint pursuant to § 76.7. megabyte). persons listed in petitioner’s certificate of service, and shall contain a detailed § 76.1906 Encoding rules for undefined § 76.1905 Petitions to modify encoding full statement of any facts or business models. rules for new services within defined considerations relied on. Factual (a) Upon public notice and subject to business models. allegations shall be supported by requirements as set forth herein, a (a) The encoding rules for defined affidavit or declaration of a person or covered entity may launch a program business models in § 76.1904 reflect the persons with actual knowledge of the service pursuant to an undefined conventional methods for packaging facts, and exhibits shall be verified by business model. Subject to Commission programs in the MVPD market as of the person who prepares them. review upon complaint, the covered December 31, 2002, and are presumed to (3) Replies. The petitioner may file a entity may initially encode programs be the appropriate rules for defined reply to the comments or oppositions pursuant to such undefined business business models. A covered entity may within ten (10) days after their model without regard to limitations set petition the Commission for approval to submission, which shall be served on all forth in § 76.1904(b). allow within a defined business model, persons who have filed pleadings and (1) Notice. Concurrent with the other than unencrypted broadcast shall also contain a detailed full launch of an undefined business model television, the encoding of a new service showing, supported by affidavit or by a covered entity, the covered entity in a manner different from the encoding declaration, of any additional facts or shall issue a press release to the PR rules set forth in § 76.1904(b)(1) and (2). considerations relied on. There shall be Newswire so as to provide public notice No such petition will be approved no further pleadings filed after of the undefined business model, and under the public interest test set forth in petitioner’s reply, unless authorized by the proposed encoding terms. The paragraph (c)(4) of this section unless the Commission. notice shall provide a concise summary

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00043 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66738 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

of the commercial audiovisual content person otherwise entitled to be a an undefined business model has been to be provided pursuant to the complainant shall instead have the launched without requisite notice, such undefined business model, and of the status of a person submitting comments party may file a complaint pursuant to terms on which such content is to be under paragraph (a)(2)(iv) of this section § 76.7. available to consumers. Immediately rather than a complainant. upon request from a party entitled to be (iv) Comments and reply. § 76.1907 Temporary bona fide trials. a complainant, the covered entity shall (A) Any person may submit The obligations and procedures as to make available information that comments regarding the complaint encoding rules set forth in §§ 76.1904(b) indicates the proposed encoding terms, within thirty (30) days after the date of and (c) and 76.1905(a) and (b) do not including the use of copy never or copy public notice by the Commission. apply in the case of a temporary bona one generation encoding, and the Comments shall be served on the fide trial of a service. encoding of content with respect to complainant and the covered entity and § 76.1908 Certain practices not prohibited. ‘‘pause’’ as defined in § 76.1904(b)(2). on any persons listed in relevant (2) Complaint process. Any interested certificates of service, and shall contain Nothing in this subpart shall be party (‘‘complainant’’) may file a a detailed full statement of any facts or construed as prohibiting a covered complaint with the Commission considerations relied on. Specific entity from: objecting to application of encoding as factual allegations shall be supported by (a) Encoding, storing or managing set forth in the notice. a declaration of a person or persons commercial audiovisual content within (i) Pre-complaint resolution. Prior to with actual knowledge of the facts, and its distribution system or within a initiating a complaint with the exhibits shall be verified by the person covered product under the control of a Commission under this section, the who prepares them. covered entity’s commercially adopted complainant shall notify the covered (B) The covered entity may file a access control method, provided that entity that it may file a complaint under response to the complaint and the outcome for the consumer from the this section. The notice must be comments within twenty (20) days after application of the encoding rules set out sufficiently detailed so that the covered the date that comments are due. Such in § 76.1904(a) and (b) is unchanged entity can determine the specific nature response shall be served on all persons thereby when such commercial of the potential complaint. The potential who have filed complaints or comments audiovisual content is released to complainant must allow a minimum of and shall also contain a detailed full consumer control, or thirty (30) days from such notice before showing, supported by affidavit or (b) Causing, with respect to a specific filing such complaint with the declaration, of any additional facts or covered product, the output of content Commission. During this period the considerations relied on. Replies shall from such product in a format as parties shall endeavor in good faith to be due ten (10) days from the date for necessary to match the display format of resolve the issue(s) in dispute. If the filing a response. another device connected to such parties fail to reach agreement within (v) Basis for Commission product, including but not limited to this 30 day period, complainant may determination as to encoding terms for providing for content conversion initiate a complaint in accordance with an undefined business model. In a between widely-used formats for the the procedures set forth herein. permit-but-disclose proceeding, unless transport, processing and display of (ii) Complaint. Within two years of otherwise specified by the Commission, audiovisual signals or data, such as publication of a notice under paragraph to determine whether encoding terms as between analog and digital formats and (a)(1) of this section, a complainant may noticed may be applied to an undefined between PAL and NTSC or RGB and file a complaint with the Commission business model, the covered entity shall Y,Pb,Pr. objecting to application of the encoding have the burden of proof to establish terms to the service at issue. Such that application of the encoding terms [FR Doc. 03–29520 Filed 11–26–03; 8:45 am] complaint shall state with particularity in the undefined business model is in BILLING CODE 6712–01–P the basis for objection to the encoding the public interest. In making any such terms. determination, the Commission shall (A) The complaint shall contain the take into account the following factors: DEPARTMENT OF DEFENSE name and address of the complainant (A) Whether the benefit to consumers and the name and address of the of the new service, including but not Department of the Army covered entity. limited to earlier release windows, more (B) The complaint shall be favorable terms, innovation or original 48 CFR Part 5125 accompanied by a certification of programming, outweighs the limitation RIN 0702–AA38 service on the named covered entity. on the consumers’ control over the new (C) The complaint shall set forth with service; Foreign Acquisition specificity all information and (B) Ways in which the new service arguments relied upon. Specific factual differs from services offered by any AGENCY: Department of Army, DoD. allegations shall be supported by a covered entity prior to December 31, ACTION: Interim final rule; request for declaration of a person or persons with 2002; comments. actual knowledge of the facts, and (vi) Determination procedures. The exhibits shall be verified by the person Commission may specify other SUMMARY: The Department of the Army who prepares them. procedures, such as oral argument, is amending the Department of the (D) The complaint shall set forth evidentiary hearing, or further written Army Acquisition Regulations (also attempts made by the complainant to submissions directed to particular referred to as the Army Federal resolve its complaint pursuant to aspects, as it deems appropriate. Acquisition Regulation Supplement paragraph (a)(2)(i) of this section. (b) Complaint regarding a service not (AFARS)) to increase consistency in (iii) Public notice. The Commission subject to notice. In an instance in Army contracts that may require shall give public notice of the filing of which an interested party has a deployment of contractor personnel. the complaint. Once the Commission substantial basis to believe and believes This change is a consolidation and has issued such public notice, any in good faith that a service pursuant to summarization of current information

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00044 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66739

available in several documents, some of total amount of services procured by military operations, as defined in Joint which are currently in draft form, and Army, and any additional costs would Publication 1–02, ‘‘DOD Dictionary of does not include new Army contracting be reimbursable under the resulting Military and Associated Terms.’’ policy. The purpose of this issuance is contract. Therefore, Army has not (b) Coordination. There are many to notify interested parties of this performed an initial regulatory operational details that will affect the change, and to request the public’s flexibility analysis. Army invites scope of work in contracts requiring comments. This change is issued by the comments from small businesses and deployment of contractor personnel in Assistant Secretary of the Army other interested parties. Army also will support of military operations. The (Acquisition, Logistics, and Technology) consider comments from small entities requirements activity, in conjunction (ASA(ALT)). This issuance is made concerning the affected AFARS subpart with the contracting activity, must concurrent with publication of an in accordance with 5 U.S.C. 610. Such coordinate with the appropriate logistics interim rule with request for comments comments should be submitted organization to determine what level of to Solicitations Provisions and Contract separately and should cite ‘‘Small support (e.g., billeting, messing, Clauses, published in this issue of the Entities CAF comment.’’ clothing and equipment, access to medical facilities, pre-deployment Federal Register. C. Paperwork Reduction Act DATES: Effective date: November 28, processing) will be available to 2003. The Paperwork Reduction Act does contractors. Comment date: Comments must be not apply because the rule does not (i) DFARS 225.802–70 (Contracts for submitted to the address shown below impose any information collection performance outside the United States on or before January 27, 2004. requirements that require the approval and Canada) prescribes special of the Office of Management and Budget procedures applicable to contracts ADDRESSES: Respondents may e-mail under 44 U.S.C. 3501, et seq. requiring the performance of work in a comments to: foreign country by U.S. personnel or a [email protected]. Those who D. Determination To Issue a Rule third country contractor, or that will cannot submit comments by e-mail may Effective With Publication in the require logistics support for contractor submit comments to: Procurement Federal Register employees, and the contracting activity Policy and Support Office, Attn: SAAL– A determination has been made under is not under the command jurisdiction PP, Sharon Wisniewski, Presidential the authority of the Army Deputy of a unified or specified command for Towers, 2511 S. Jeff Davis Highway, Assistant Secretary of the Army (Policy the country involved. This provision Arlington, VA, 22202, facsimile (703) & Procurement) that urgent and generally requires the contracting 604–8178. Please cite ‘‘AFARS CAF compelling reasons exist to publish this activity to undertake certain Clause’’ in the subject line of comments. rule prior to affording the public an coordination with the cognizant FOR FURTHER INFORMATION CONTACT: opportunity to comment. Contracting contract administration office for that Sharon Wisniewski, (586) 574–7050 or offices continue to write contracts that country. Linda Fowlkes, (703) 604–7104. require contractor personnel to (ii) In situations where no contract SUPPLEMENTARY INFORMATION: accompany the military force in Iraq administration office has been and other places. Contractor designated, the contracting officer shall A. Background representatives and contracting offices ensure, prior to contract award, that the This interim rule is added to have requested inclusion of coverage in responsible combatant command incorporate information to facilitate the AFARS expeditiously, even if not a concurs with any contract provision that deploying contractor personnel to Iraq complete solution, pending coverage on promises logistical support to U.S. or or other areas of operations. It also seeks this topic in higher level regulations. foreign national contractor personnel. to ease the administrative difficulty for Comments received in response to this This requirement may be satisfied each contractor and contracting office notice will be considered. through a memorandum executed by the researching current guidance on requiring activity that documents contractors accompanying the force, and Emily Clarke, combatant command approval of any to increase consistency among Army Director, Procurement Policy and Support. logistical support specified in the main contracts. This AFARS change is List of Subjects in 48 CFR Part 5125 body of the contract or its statement of published to address contractor and work. Government contracts, Government Army contracting offices’ questions and (c) Legal status of contractor procurement. concerns. This rule was not subject to personnel. The Status of Forces ■ Office of Management and Budget For the reasons stated in the preamble, Agreements applicable to the Area of review under Executive Order 12866, the Department of the Army adds 48 CFR Operations (AO), as well as the Geneva dated , 1993. part 5125 to read as follows: Conventions and other international laws govern the legal status of PART 5125—FOREIGN ACQUISITION B. Regulatory Flexibility Act contractor personnel. Contractor The Army does not expect this rule to personnel’s legal status will vary have a significant economic impact on Authority: 5 U.S.C 301, 10 U.S.C. 2202, DoD Directive 5000.35, FAR 1.301 and DOD depending on the location and a substantial number of small entities FAR Supplement 201.3. circumstances surrounding an incident. within the meaning of the Regulatory (d) Requirements offices and Flexibility Act, 5 U.S.C. 601, et seq., Subpart 5125.74–9000—Contractors contracting officers should use the because the rule applies only to Accompanying the Force—Deployment Army Contractors Accompanying the contractors that may require of Contractor Personnel in Support of Force Guidebook for more detailed deployment of contractor personnel Military Operations guidance, including sample contract outside the United States, and because language, and a listing of Army and DoD it only consolidates existing and draft Scope of Subpart regulations and other resources. logistical guidance. The amount of such (a) General. This subpart applies Contracting Officers may tailor this additional services is not expected to be whenever contractors may be required language as appropriate, but using the significantly large in comparison to the to accompany the force in support of Guidebook will both answer many

VerDate jul<14>2003 14:44 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00045 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66740 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

common questions and foster uniform 604–8178. Please cite ‘‘AFARS CAF D. Determination To Issue a Rule handling of common issues. The Clause’’ in the subject line of comments. Effective With Publication in the Guidebook may be found on the Deputy Federal Register FOR FURTHER INFORMATION CONTACT: Assistant Secretary of the Army A determination has been made under (Procurement & Production) Web site at Sharon Wisniewski, (586) 574–7050 or Linda Fowlkes, (703)604–7104. the authority of the Army Deputy http://dasapp.saalt.army.mil/. Assistant Secretary of the Army (Policy (e) Solicitation provision and contract SUPPLEMENTARY INFORMATION: & Procurement) that urgent and clause. The clause at § 5152.225–74– A. Background compelling reasons exist to publish this 9000 shall be inserted in all solicitations notice prior to affording the public an and contracts that may require This issuance amends 48 CFR part opportunity to comment. Contracting deployment of contractor personnel in 5152 (also referred to as the Army offices continue to write contracts that support of military operations. It may be Federal Acquisition Regulation require contractor personnel to tailored to fit the specific circumstances accompany the military force in Iraq of the procurement. Supplement (AFARS)) to incorporate information to facilitate deploying and other places. Contractor [FR Doc. 03–29416 Filed 11–26–03; 8:45 am] contractor personnel to Iraq or other representatives and contracting offices BILLING CODE 3710–08–P areas of operations. It also seeks to ease have requested inclusion of coverage in the administrative difficulty for each the AFARS expeditiously, even if not a contractor and contracting office complete solution, pending coverage on DEPARTMENT OF DEFENSE researching current guidance on this topic in higher level regulations. Comments received in response to this contractors accompanying the force, and Department of the Army notice will be considered. to increase consistency among Army 48 CFR Part 5152 contracts. This AFARS change is Emily Clarke, published to address contractor and Director, Procurement Policy and Support. RIN 0702–AA39 Army contracting offices’ questions and List of Subjects in 48 CFR Part 5152 Solicitation Provisions and Contract concerns. This notice was not subject to Clauses Office of Management and Budget Government contracts, Government review under Executive Order 12866, procurement. AGENCY: Department of Army, DOD. dated September 30, 1993. ■ For reasons set forth in the preamble, ACTION: Interim final rule; Request for the Department of the Army amends 48 comments. B. Regulatory Flexibility Act CFR Part 5152 as follows:

SUMMARY: The Department of the Army The Army does not expect this rule to PART 5152—SOLICITATIONS is amending its Acquisition Regulations have a significant economic impact on PROVISIONS AND CONTRACT to increase consistency in Army a substantial number of small entities CLAUSES contracts that may require deployment within the meaning of the Regulatory ■ of contractor personnel. This change is Flexibility Act, 5 U.S.C. 601, et seq., 1. The authority citation for 5152.225– a consolidation and summarization of because the rule applies only to 74–9000 is added to read as follows: current information available in several contractors that may require Authority: 5 U.S.C. 301, 10 U.S.C. 2202, documents, some of which are currently deployment of contractor personnel DOD Directive 5000.35, FAR 1.301 and DOD in draft form, and does not include new outside the United States, and because FAR Supplement 201.3. Army contracting policy. The purpose it only consolidates existing and draft ■ 2. Add 5152.225–74–9000 to read as of this issuance is to notify interested logistical guidance. The amount of such follows: parties of this change, and to request the additional services is not expected to be public’s comments. This change is 5152.225–74–9000 Contractors significantly large in comparison to the Accompanying the Force. issued by the Assistant Secretary of the total amount of services procured by Army (Acquisition, Logistics, and Army, and any additional costs would As prescribed at subpart 5125.74– 9000(e) insert the following clause: Technology) (ASA(ALT)). This issuance be reimbursable under the resulting is made concurrent with publication of contract. Therefore, Army has not CONTRACTORS ACCOMPANYING THE an interim rule with request for performed an initial regulatory FORCE (NOV. 2003) comments to add rules concerning flexibility analysis. Army invites (a) General. (1) Performance of this Foreign Acquisition—Contractors comments from small businesses and contract may require deployment of Accompanying the Force, published in other interested parties. Army also will Contractor Personnel in support of military this issue of the Federal Register. operations. The Contractor acknowledges consider comments from small entities that such operations are inherently DATES: Effective date: November 28, concerning the affected AFARS subpart 2003. dangerous and accepts the risks associated in accordance with 5 U.S.C. 610. Such with contract performance in this Comment date: Comments must be comments should be submitted environment. submitted to the address shown below separately and should cite ‘‘Small (2) For purposes of this clause, the term on or before January 27, 2004. Entities CAF comment.’’ ‘‘Contractor Personnel’’ refers to the ADDRESSES: Respondents may e-mail Contractor’s officers and employees. Unless comments to: C. Paperwork Reduction Act otherwise specified (e.g., subparagraph (b) of [email protected]. Those who this clause), this term does not include cannot submit comments by e-mail may The Paperwork Reduction Act does personnel who permanently reside in the not apply because the rule does not country where contract performance will take submit comments to: Procurement place. Policy and Support Office, Attn: SAAL- impose any information collection requirements that require the approval (3) The Contractor shall ensure that PP, Sharon Wisniewski, Presidential Contractor Personnel working in an area of Towers, 2511 S. Jeff Davis Highway, of the Office of Management and Budget operations (AO, as defined in the Joint Arlington, VA, 22202, facsimile (703) under 44 U.S.C. 3501, et seq. Publication 1–02, ‘‘DOD Dictionary of

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00046 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66741

Military and Associated Terms’’) are familiar specifically authorized), and the Contractor services designated as limited, in accordance and comply with applicable: (i) Military shall notify the Contracting Officer’s with instructions provided by the Service and Department of Defense designated representative that these actions Administrative Contracting Officer or the regulations, directives, instructions, general have been accomplished. Contracting Officer’s designated orders, policies, and procedures, in particular (5) The Contractor shall have a plan for representative. Army Regulation 715–9 and Field Manual 3– timely replacement of employees who are no (End of Clause) 100.21; (ii) U.S., host country, local, and longer available for deployment for any international laws and regulations; and (iii) reason, including mobilization as members of [FR Doc. 03–29417 Filed 11–26–03; 8:45 am] treaties and international agreements (e.g., the Reserve, injury, or death. BILLING CODE 3710–08–P Status of Forces Agreements, Host Nation (d) Clothing and Equipment Issue. (1) To Support Agreements, and Defense Technical help distinguish them from combatants, Agreements) relating to safety, health, force Contractor Personnel shall not wear military protection, and operations under this clothing unless specifically authorized by a DEPARTMENT OF TRANSPORTATION contract. written Department of Army waiver. (4) The Contractor shall ensure that this Contractor Personnel may wear specific items National Highway Traffic Safety clause is included in all subcontracts. of clothing and equipment required for safety Administration (b) Compliance with Combatant Command and security such as ballistic or NBC Orders. The Contractor shall ensure that (Nuclear, Biological, Chemical) protective 49 CFR Part 571 Contractor Personnel, regardless of residency clothing. The CONUS Replacement Center or status, working in the AO comply with all the combatant command may provide to the [Docket No. NHTSA–2002–12065] orders, directives, and instructions of the Contractor Personnel military unique combatant command relating to non- Organizational Clothing and Individual RIN 2127–AI88 interference in military operations, force Equipment (OCIE) to ensure security and protection, health, and safety. The Combatant safety. Federal Motor Vehicle Safety Commander or his subordinate commanders, (2) All issued OCIE shall be considered Standards; Child Restraint Systems in conjunction with the Contracting Officer Government Furnished Property, and will be AGENCY: National Highway Traffic or the Contracting Officer’s Representative, treated in accordance with Government may direct the Contractor, at the Contractor’s Furnished Property clauses included Safety Administration (NHTSA), own expense, to replace and, where elsewhere in this contract. Department of Transportation. applicable, repatriate any Contractor (e) Weapons and Training. (1) Contractor ACTION: Delay of expiration date of personnel who fail to comply with this Personnel may not possess privately owned interim final rule. provision. Such action may be taken at the firearms in the AO. The combatant command Government’s discretion without prejudice to may issue weapons and ammunition to SUMMARY: On , 2002, NHTSA its rights under any other provision of this Contractor Personnel, with the employee’s published an interim final rule that contract, including the Termination for company’s consent as well as the individual amended the Federal motor vehicle Default clause. employees’ consent, and may require safety standard on child restraint (c) Contractor Personnel Administration. weapons and other pre-deployment training. (1) In order to maintain accountability of all (2) The Contractor shall ensure that systems to permit the manufacture and deployed personnel in the AO, the Contractor Contractor Personnel follow all instructions sale of harnesses that attach to school shall follow instructions issued by the Army by the combatant command, as well as bus seat backs as long as the harnesses Materiel Command’s Logistics Support applicable Military Service and DoD are properly labeled. The agency Element (AMC LSE) or other Contracting regulations, regarding possession, use, safety, scheduled the interim final rule to Officer’s designated representative to and accountability of weapons and terminate on December 1, 2003, while provide, and keep current, requested data on ammunition. requesting comments on permanently Contractor Personnel for entry into military (3) All issued weapons, ammunition, and adopting the provisions of the interim personnel database systems. accessories (e.g., holsters) shall be considered final rule. To allow for more time to (2) The Contractor shall coordinate with Government Furnished Property. Upon the AMC LSE or other Contracting Officer’s redeployment or notification by the respond to the comments, this designated representative for logistics combatant command, the Contractor shall document delays the expiration date of support, as follows: (i) Upon initial entry into ensure that all Government issued weapons the interim final rule for an additional the AO; (ii) upon initiation of contract and unused ammunition are returned to the nine months. performance; (iii) upon relocation of contract point of issue using a method that complies DATES: The expiration of the interim operations within the AO; and (iv) upon with Military Service regulations for issue final rule published at 67 FR 64818 exiting the AO. and turn-in of firearms. (October 22, 2002), as amended by this (3) Before deployment, the Contractor shall (f) Vehicle and Equipment Operation. (1) ensure that: The Contractor shall ensure that Contractor rule, is delayed until , 2004. (i) All Contractor Personnel complete two Personnel possess the required licenses to The amendment published in this rule DD Forms 93, Record of Emergency Data operate all vehicles or equipment necessary is effective November 28, 2003, and Card. One copy of the completed form shall to perform the contract in the AO. expires on September 1, 2004. be returned to the Government official (2) Contractor-owned or leased motor Any petitions for reconsideration of specified by the Contracting Officer’s vehicles or equipment shall meet all this final rule must be received by designated representative; the other shall be requirements established by the combatant NHTSA not later than , 2004. hand-carried by the individual employee to command and shall be maintained in a safe ADDRESSES: the AO. operating condition. Petitions for (ii) All required security and background (g) Passports, Visas and Customs. The reconsideration, identified by DOT DMS checks are completed. Contractor is responsible for obtaining all Docket No. NHTSA–2002–12065, (iii) All medical screening and passports, visas, and other documents should be submitted to: Administrator, requirements are met. necessary for Contractor Personnel to enter National Highway Traffic Safety (4) The Contractor shall ensure that and exit any AO. Administration, 400 Seventh St., SW., Contractor Personnel have completed all pre- (h) Purchasing Limited Resources. When Washington, DC 20590. deployment requirements specified by the the Combatant Command establishes a FOR FURTHER INFORMATION CONTACT: Contracting Officer’s designated Commander-in-Chief Logistics Procurement The representative (including processing through Support Board (CLPSB), Joint Acquisition following persons at the National the designated Continental United States Review Board, or similar purchase review Highway Traffic Safety Administration, (CONUS) Replacement Center unless another committee, the contractor will be required to 400 Seventh Street, SW., Washington, deployment processing method is coordinate local purchases of goods and DC 20590:

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00047 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66742 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

For technical issues: Mr. Tewabe The interim rule also added a that attach to school bus seat backs prior Asebe, Office of Crashworthiness definition of ‘‘harness’’ 1 to the standard. to the agency’s response to comments Standards, NVS–113, telephone (202) The definition of a harness is ‘‘a that requested the interim rule to be 366–2365, facsimile (202) 493–2739. combination pelvic and upper torso made permanent. Also, pupil For legal issues: Mr. Christopher child restraint system that consists transportation operators would find it Calamita, Office of Chief Counsel, NCC– primarily of flexible material, such as increasingly difficult to purchase seat- 112, telephone (202) 366–2992, straps, webbing or similar material, and mounted harnesses beginning December facsimile (202) 366–3820. that does not include a rigid seating 1, 2003. structure for the child.’’ SUPPLEMENTARY INFORMATION: Interim Rulemaking Analysis and Notices The interim rule made several other Final Rule amendments to FMVSS No. 213 relating A. Executive Order 12866 and DOT On October 22, 2002, NHTSA to this issue. These other amendments Regulatory Policies and Procedures published an interim final rule to specified the means of attachment by permit, temporarily, the manufacture NHTSA has considered the impact of which a harness must be capable of this rule under Executive Order 12866 and sale of harnesses designed to attach meeting the requirements of FMVSS No. to school bus seats. (67 FR 64818; and the Department of Transportation’s 213 and established the dynamic test regulatory policies and procedures. This Docket No. NHTSA–2002–12065). The procedures of the standard for testing interim rule was adopted to facilitate rulemaking document was not reviewed seat-mounted harnesses. under E.O. 12866, ‘‘Regulatory Planning the transportation of preschool and NHTSA determined that it was in the special needs children for the new and Review.’’ This action has been public interest to make the changes determined to be ‘‘nonsignificant’’ school year, and to relieve a restriction effective immediately on an interim imposed by FMVSS No. 213, Child under the Department of basis (until December 1, 2003) to enable Transportation’s regulatory policies and restraint systems, on the manufacture the restraints to be manufactured and and sale of the harnesses. procedures. The agency concludes that sold for immediate use during the the impacts of the amendments are so The interim rule responded to a school year. A one-year period was petition for rulemaking from a harness minimal that preparation of a full provided to enable us to decide whether regulatory evaluation is not required. manufacturer, E-Z-On Products, Inc. to amend the standard permanently. (‘‘E-Z-On’’), which requested that The rule will not impose any new A large majority of the commenters requirements or costs on manufacturers, NHTSA amend a prohibition in S5.3.1 supported adopting a permanent of FMVSS No. 213 against seat-mounted but instead will continue to allow exclusion for harnesses manufactured manufacturers to produce a type of harnesses. The petitioner believed that and sold for use on school bus seats the harnesses were especially needed to harness for nine months if the harness from the prohibition against such a bears a label providing information help transport preschool and special design. Some commenters raised needs children in school buses, because regarding how the harness should be questions about the warning label text used. the devices could restrain the children and placement. Comments were also and provide upper body support received on the specific test conditions B. Regulatory Flexibility Act without the use of seat belts. of the standard. NHTSA has considered the impacts of In the interim rule, NHTSA The agency is in the process of this rulemaking action under the determined that permitting the determining whether to amend the Regulatory Flexibility Act (5 U.S.C. 601 manufacture and sale of seat-mounted standard permanently in response to the et seq.). I certify that the amendment harnesses for use on school buses would comments received. We anticipate will not have a significant economic enhance the safe transportation of issuing a response to comments in early impact on a substantial number of small preschool and special needs children, 2004. A nine-month extension of the entities. The rule will not impose any subject to a precautionary measure to temporary amendments, to September 1, new requirements or costs on avoid overloading the seat to which the 2004, preserves the status quo until manufacturers, but instead will extend harness is attached in a collision. The then. the period in which manufacturers are interim rule provided that, as of Effective Date of This Document permitted to produce seated-mounted , 2003, seat-mounted harnesses, so long as the harnesses bear harnesses for school buses could be Because the December 1, 2003 date for a label providing information regarding manufactured if they bore a permanent the termination of the period during how the restraint should be used. We warning label that warned about which seat-mounted harnesses can be anticipate that the seat-mounted overloading the seat. The agency manufactured is fast approaching, harnesses will be sold to school districts decided that the likelihood of seat NHTSA finds for good cause that and to other pupil transportation failure in a collision would be reduced today’s action extending the temporary providers. NHTSA has learned of the if the entire seat directly rearward of a amendments must take effect existence of two manufacturers, both of child restrained in a seat-mounted immediately. Today’s final rule makes which are small businesses. The agency harness were vacant or occupied only no substantive change to the standard as believes that this rule will not have a by restrained passengers. NHTSA amended by the interim rule, but significant impact on these businesses required the label to be placed on the extends the temporary amendments for since it only preserves the status quo for part of the restraint that attaches the nine months while the agency complete nine months. harness to the vehicle seat back, and it its response to the comments. If the must be visible when the harness is effective date were not delayed, C. Paperwork Reduction Act installed. The label must bear a manufacturers would be required to Under the Paperwork Reduction Act pictogram and the following statements: stop production and sales of harnesses of 1995, a person is not required to ‘‘WARNING! This restraint must only be respond to a collection of information used on school bus seats. Entire seat 1 We consider the term ‘‘harness’’ to be interchangeable with the term ‘‘vest’’, which is by a Federal agency unless the directly behind must be unoccupied or commonly used to describe seatk-mounted collection displays a valid OMB control have restrained occupants.’’ retraints. number. This document does not

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00048 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66743

establish any new information the Federal standard, except to the document to find this action in the collection requirements. extent that the state requirement Unified Agenda. imposes a higher level of performance D. National Environmental Policy Act List of Subjects in 49 CFR Part 571 and applies only to vehicles procured NHTSA has analyzed this amendment for the State’s use. 49 U.S.C. 30161 sets Motor vehicle safety, Reporting and for the purposes of the National forth a procedure for judicial review of recordkeeping requirements, Tires. Environmental Policy Act and final rules establishing, amending or determined that it will not have any revoking Federal motor vehicle safety PART 571—[AMENDED] significant impact on the quality of the standards. That section does not require ■ In consideration of the foregoing, human environment. submission of a petition for NHTSA amends 49 CFR part 571 as set E. Executive Order 13132 (Federalism) reconsideration or other administrative forth below. proceedings before parties may file suit ■ 1. The authority citation for part 571 Executive Order 13132 requires in court. NHTSA to develop an accountable continues to read as follows: process to ensure ‘‘meaningful and G. National Technology Transfer and Authority: 49 U.S.C. 322, 30111, 30115, timely input by State and local officials Advancement Act 30117 and 30166; delegation of authority at 49 CFR 1.50. in the development of regulatory Section 12(d) of the National policies that have federalism Technology Transfer and Advancement § 571.213 [Amended] implications.’’ ‘‘Policies that have Act of 1995 (NTTAA), Public Law 104– ■ federalism implications’’ is defined in 2. In § 571.213, S5.3.1 is revised to read 113, section 12(d) (15 U.S.C. 272) as follows: the Executive Order to include directs us to use voluntary consensus regulations that have ‘‘substantial direct standards in regulatory activities unless § 571.213 Standard No. 213; Child restraint effects on the States, on the relationship doing so would be inconsistent with systems. between the national government and applicable law or otherwise impractical. * * * * * the States, or on the distribution of Voluntary consensus standards are S5.3.1 Add-on child restraints shall power and responsibilities among the technical standards (e.g., materials meet the requirements of either various levels of government.’’ Under specifications, test methods, sampling paragraph (a) or (b) of this section, as Executive Order 13132, the agency may procedures, and business practices) that appropriate. not issue a regulation with Federalism are developed or adopted by voluntary (a) Except for components designed to implications, that imposes substantial consensus standards bodies, such as the attach to a child restraint anchorage direct costs, and that is not required by Society of Automotive Engineers (SAE). system, each add-on child restraint statute, unless the Federal government The agency searched for, but did not system must not have any means provides the funds necessary to pay the find any voluntary consensus standards designed for attaching the system to a direct compliance costs incurred by relevant to this final rule. vehicle seat cushion or vehicle seat back State and local governments, or the H. Unfunded Mandates Reform Act and any component (except belts) that is agency consults with State and local designed to be inserted between the officials early in the process of Section 202 of the Unfunded vehicle seat cushion and vehicle seat developing the proposed regulation. Mandates Reform Act of 1995 (UMRA) back. Harnesses manufactured before NHTSA may also not issue a regulation requires Federal agencies to prepare a February 1, 2003 that are manufactured with Federalism implications and that written assessment of the costs, benefits, for use on school bus seats are excluded preempts State law unless the agency and other effects of proposed or final from S5.3.1(a). consults with State and local officials rules that include a Federal mandate (b) Harnesses manufactured on or early in the process of developing the likely to result in the expenditure by after February 1, 2003, but before proposed regulation. State, local, or tribal governments, in the September 1, 2004, for use on school The agency has analyzed this aggregate, or by the private sector, of bus seats must meet S5.3.1(a) of this rulemaking action in accordance with more than $100 million in any one year standard, unless a label that conforms in the principles and criteria contained in (adjusted for inflation with base year of content to Figure 12 and to the Executive Order 13132 and has 1995). requirements of S5.3.1(b)(1) through determined that it does not have This final rule will not impose any S5.3.1(b)(3) of this standard is sufficient federalism implications to unfunded mandates under the permanently affixed to the part of the warrant consultation with State and Unfunded Mandates Reform Act of harness that attaches the system to a local officials or the preparation of a 1995. This rule will not result in costs vehicle seat back. federalism summary impact statement. of $100 million or more to either State, (1) The label must be plainly visible The rule will have no substantial effects local, or tribal governments, in the when installed and easily readable. on the States, or on the current Federal- aggregate, or to the private sector. Thus, (2) The message area must be white State relationship, or on the current this rule is not subject to the with black text. The message area must distribution of power and requirements of sections 202 and 205 of be no less than 20 square centimeters. responsibilities among the various local the UMRA. (3) The pictogram shall be gray and officials. I. Regulation Identifier Number (RIN) black with a red circle and slash on a F. Executive Order 12778 (Civil Justice white background. The pictogram shall The Department of Transportation be no less than 20 mm in diameter. Reform) assigns a regulation identifier number * * * * * This rule does not have any (RIN) to each regulatory action listed in retroactive effect. Under 49 U.S.C. the Unified Agenda of Federal Issued on: November 21, 2003. 30103, whenever a Federal motor Regulations. The Regulatory Information Jeffrey W. Runge, vehicle safety standard is in effect, a Service Center publishes the Unified Administrator. state may not adopt or maintain a safety Agenda in April and October of each [FR Doc. 03–29610 Filed 11–24–03; 12:02 standard applicable to the same aspect year. You may use the RIN contained in pm] of performance which is not identical to the heading at the beginning of this BILLING CODE 4910–59–P

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00049 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66744 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

DEPARTMENT OF THE INTERIOR SUPPLEMENTARY INFORMATION: expected to, and is not reasonably likely to, adversely affect the species or stock Background Fish and Wildlife Service through effects on annual rates of Section 1371(a)(5)(A) of the Marine recruitment or survival.’’ Unmitigable 50 CFR Part 18 Mammal Protection Act (MMPA) (16 adverse impact means ‘‘an impact U.S.C. 1361–1407) gives the Secretary of RIN 1018–AH92 resulting from the specified activity (1) the Interior (Secretary) through the that is likely to reduce the availability Marine Mammals; Incidental Take Director of the Service the authority to of the species to a level insufficient for During Specified Activities allow the incidental, but not intentional, a harvest to meet subsistence needs by taking of small numbers of marine (i) causing the marine mammals to AGENCY: Fish and Wildlife Service, mammals, in response to requests by abandon or avoid hunting areas, (ii) Interior. U.S. citizens (you) (as defined in 50 CFR directly displacing subsistence users, or ACTION: Final rule. 18.27(c)) engaged in a specified activity (iii) placing physical barriers between (other than commercial fishing) in a the marine mammals and the SUMMARY: We, the Fish and Wildlife specified geographic region. If subsistence hunters; and (2) that cannot Service (Service), have developed regulations allowing such incidental be sufficiently mitigated by other regulations that would authorize the taking are issued, we can issue Letters measures to increase the availability of incidental, unintentional take of small of Authorization (LOA) to conduct marine mammals to allow subsistence numbers of polar bears and Pacific activities under the provisions of these needs to be met.’’ Industry conducts walrus during year-round oil and gas regulations when requested by citizens activities such as oil and gas industry (Industry) exploration, of the United States. exploration, development, and development, and production We are authorizing the incidental production in marine mammal habitat operations in the Beaufort Sea and taking of polar bears and Pacific walrus and, therefore, risks violating the adjacent northern coast of Alaska. based on our final finding using the best prohibitions on the taking of marine Industry operations for the covered scientific evidence available that the mammals. period are similar to and include all total of such taking for the regulatory Although Industry is under no legal activities covered by the 3-year Beaufort period will have no more than a requirement to obtain incidental take Sea incidental take regulations that were negligible impact on these species and authorization, since 1993 Industry has effective from , 2000, through will not have an unmitigable adverse chosen to seek authorization to avoid , 2003 (65 FR 16828, March 30, impact on the availability of these the uncertainties of taking marine 2000). species for taking for subsistence use by mammals associated with conducting We find that the total expected Alaska Natives. These regulations set activities in marine mammal habitat. takings of polar bear and Pacific walrus forth: (1) Permissible methods of taking; On , 1993 (58 FR 60402), during oil and gas industry exploration, (2) the means of effecting the least we issued final regulations to allow the development, and production activities practicable adverse impact on the incidental, but not intentional, take of will have a negligible impact on these species and their habitat and on the small numbers of polar bears and Pacific species and no unmitigable adverse availability of the species for walrus when such taking(s) occurred in impacts on the availability of these subsistence uses; and (3) requirements the course of Industry activities during species for subsistence use by Alaska for monitoring and reporting. year-round operations in the area Natives. We base this finding on the The term ‘‘take,’’ as defined by the described later in this rule in the section results of 9 years of monitoring and MMPA, means to harass, hunt, capture, ‘‘Description of Geographic Region.’’ evaluating interactions between polar or kill, or attempt to harass, hunt, The regulations were effective for 18 bears, Pacific walrus, and Industry, and capture, or kill, any marine mammal. months. At the same time, the Secretary also on oil spill trajectory models, polar Harassment as defined by the MMPA, as of the Interior directed us to develop, bear density models, and an amended in 1994, ‘‘means any act of and then begin implementation of, a independent population distribution pursuit, torment, or annoyance which (i) polar bear habitat conservation strategy model that determine the likelihood of has the potential to injure a marine before extending the regulations beyond impacts to polar bears should an mammal or marine mammal stock in the the initial 18 months for a total 5-year accidental oil release occur. wild’’ (the MMPA calls this Level A period as allowed by the MMPA. On harassment), ‘‘or (ii) has the potential to , 1995, we completed DATES: This rule is effective November disturb a marine mammal or marine development of and issued our Habitat 28, 2003, and remains effective through mammal stock in the wild by causing Conservation Strategy for Polar Bears in , 2005. disruption of behavioral patterns, Alaska to ensure that the regulations ADDRESSES: Comments and materials including, but not limited to, migration, met with the intent of Congress. On received in response to this action are breathing, nursing, breeding, feeding, or , 1995, we issued the final available for public inspection during sheltering’’ (the MMPA calls this Level rule and notice of availability of a normal working hours of 8 a.m. to 4:30 B harassment). As a result of 1986 completed final polar bear habitat p.m., Monday through Friday, at the amendments to the MMPA, we conservation strategy (60 FR 42805). We Office of Marine Mammals amended 50 CFR 18.27 (i.e., regulations then extended the regulations for an Management, U.S. Fish and Wildlife governing small takes of marine additional 42 months to expire on Service, 1011 E. Tudor Road, mammals incidental to specified , 1998. Anchorage, AK 99503. activities) with a final rule published on On , 1997, BP Exploration FOR FURTHER INFORMATION CONTACT: , 1989 (54 FR 40338). (Alaska), Inc., submitted a petition for Craig Perham, Office of Marine Section 18.27(c) included a revised itself and for ARCO Alaska, Inc., Exxon Mammals Management, U.S. Fish and definition of ‘‘negligible impact’’ and a Corporation, and Western Geophysical Wildlife Service, 1011 East Tudor Road, new definition for ‘‘unmitigable adverse Company for rulemaking pursuant to Anchorage, AK 99503; telephone 907– impact’’ as follows. Negligible impact is section 101(a)(5)(A) of the MMPA, and 786–3810 or 1–800–362–5148; e-mail: ‘‘an impact resulting from the specified section 553(e) of the Administrative [email protected]. activity that cannot be reasonably Procedure Act (APA; 5 U.S.C. 553).

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00050 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66745

Their request sought regulations to analyzed. A 3-year period was selected, small numbers of polar bears and Pacific allow the incidental, but not intentional, rather than a 5-year period, due to the walrus incidental to year-round oil and take of small numbers of polar bears and potential development of additional gas industry exploration, development, Pacific walrus when takings occurred offshore oil and gas production sites, and production operations in the during Industry operations in Arctic such as the offshore Liberty Beaufort Sea and adjacent northern Alaska. Specifically, they requested an Development, which would need coast of Alaska. extension of the incidental take increased oil spill analysis if The comment period on the proposed regulations that begin at 50 CFR 18.121 development proceeded. The Liberty rule was open from , 2003, for an additional 5-year term from Development Plan was subsequently through , 2003. To expedite , 1998, through December withdrawn by the operator to be re- the rulemaking process, a comment 15, 2003. The geographic extent of the evaluated. period of 30 days was selected because request was the same as that of Between January 1994 and March the previous regulations authorizing the previously issued regulations that begin 2003, we issued 223 LOAs for oil and incidental, unintentional take of small at 50 CFR 18.121 that were in effect gas related activities. Activities covered numbers of polar bears and Pacific through December 15, 1998 (see above). by LOAs included: exploratory walrus during year-round oil and gas The petition to extend the incidental operations, such as seismic surveys and industry exploration, development, and take regulations included two new oil drilling; development activities, such as production operations in the Beaufort fields (Northstar and Liberty). Plans to construction and remediation; and Sea and adjacent northern coast of develop each field identified a need for production activities for operational Alaska had expired on March 31, 2003. an offshore gravel island and a buried fields. Between January 1, 1994, and We are issuing new regulations that subsea pipeline to transport crude oil to March 31, 2000, 77 percent (n=89) of will remain in effect for 16 months to existing onshore infrastructure. The LOAs issued were for exploratory ensure that we have adequate time to Liberty prospect was subsequently activities, 10 percent (n=11) were for thoroughly assess effects of Industry abandoned, while the Northstar development, and 13 percent (n=15) activities over the longer period (5 prospect moved toward production. At were for production activities. Less than years) requested by Industry. We will the time, based on the preliminary a third (32 of 115) of these activities assess the effects of Industry activities nature of the information related to actually sighted polar bears, and for the requested period (5 years) and subsea pipelines published in a Draft approximately two-thirds of sightings expect to publish a longer-term Environmental Impact Statement (DEIS) (171 of 258) occurred during production proposed rule during the term described for the Northstar project, we were activities. in this final rule. unable to make a finding of negligible Summary of Current Request Description of Regulations impact and issue regulations for the full 5-year period as requested by Industry. On , 2002, the Alaska Oil The regulations that we are issuing On , 1998, we published and Gas Association (AOGA), on behalf include: Permissible methods of taking; proposed regulations (63 FR 63812) to of its members, requested that we measures to ensure the least practicable allow the incidental, unintentional take promulgate regulations for nonlethal adverse impact on the species and the of small numbers of polar bears and incidental take of small numbers of availability of these species for Pacific walrus in the Beaufort Sea and Pacific walrus and polar bears pursuant subsistence uses; and requirements for northern coast of Alaska for a 15-month to section 101(a)(5) of the MMPA. The monitoring and reporting. The period. These regulations did not request was for a period of 5 years, from geographic coverage and the scope of authorize the incidental take of polar March 31, 2003, through March 31, industrial activities assessed in these bears and Pacific walrus during 2008. Members of AOGA include regulations are the same as those in the construction or operation of subsea Alyeska Pipeline Service Company; regulations we issued on March 30, pipelines in the Beaufort Sea. On Marathon Oil Company; Anadarko 2000. New LOAs will be issued , 1999, we issued final Petroleum Corporation Petro Star, Inc.; following the effective date of these regulations effective through January 30, BP Exploration (Alaska) Inc.; Phillips final regulations. 2000 (64 FR 4328). Alaska, Inc.; ChevronTexaco These regulations do not authorize the The U.S. Army Corps of Engineers Corporation; Shell Western E&P Inc.; actual activities associated with oil and (Corps) finalized the Northstar Final Cook Inlet Pipe Line Company; Tesoro gas exploration, development, and Environmental Impact Statement (FEIS) Alaska Company; Cook Inlet Region, production. Rather, they authorize the in February 1999. On , 2000, Inc.; TotalFinaElf E&P USA; EnCana Oil incidental, unintentional take of small we issued regulations effective through & Gas (USA) Inc.; UNOCAL; Evergreen numbers of polar bears and Pacific March 31, 2000 (65 FR 5275), in order Resources, Inc.; Williams Alaska walrus associated with those activities. to finalize the subsequent longer-term Petroleum, Inc.; ExxonMobil Production The U.S. Minerals Management Service regulations without a lapse in coverage. Company; XTO Energy, Inc.; and Forest (MMS), the Corps, and the U.S. Bureau After a thorough analysis of the Oil Corporation. Along with their of Land Management are responsible for Northstar FEIS and other data related to request for incidental take permitting activities associated with oil oil spills, on March 30, 2000, we issued authorization, Industry has also and gas activities in Federal waters and regulations effective for a 3-year developed and implemented polar bear on Federal lands. The State of Alaska is duration, through March 31, 2003 (65 conservation measures. The geographic responsible for activities on State lands FR 16828). This assessment included a region defined in Industry’s 2002 and in State waters. polar bear oil spill risk analysis, a model application is described later in this rule With final incidental take regulations, that simulated oil spills and their in the section titled ‘‘Description of persons seeking taking authorization for subsequent effects on estimated polar Geographic Region.’’ particular projects will apply for an bear survival on the basis of distribution On July 25, 2003, we published in the LOA to cover take associated with in the Beaufort Sea. The likelihood of Federal Register (68 FR 44020) a exploration, development, and polar bear mortality caused by oil spills proposal to promulgate regulations production activities pursuant to the during different seasons (open-water, under section 101(a)(5)(A) of the MMPA regulations. Each group or individual ice-covered, broken ice) was also that would allow the Industry to take conducting an oil and gas industry-

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00051 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66746 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

related activity within the area covered do not authorize incidental take for Alaska’s North Slope encompasses an by these regulations may request an offshore production sites other than the area of 88,280 square miles and contains LOA. Each applicant for an LOA must Northstar Production area. 8 major oil and gas fields in production: submit a plan to monitor the effects of Exploration activities may occur Endicott-Duck Island, Prudhoe Bay, authorized activities on polar bears and onshore or offshore and include: Kuparuk River, Point McIntyre, Milne walrus. Each LOA applicant must also Geological surveys; geotechnical site Point, Badami, Northstar, and Colville include a Plan of Cooperation on the investigations; reflective seismic River. These 8 fields include 21 current availability of these species for exploration; vibrator seismic data satellite oilfields: Sag Delta North, subsistence use by Alaska Native collection; airgun and water gun seismic Eider, North Prudhoe Bay, Lisburne, communities that may be affected by data collection; explosive seismic data Niakuk, Niakuk-Ivashak, Aurora, Industry operations. The purpose of the collection; vertical seismic profiles; Midnight Sun, Borealis, West Beach, Plan is to minimize the impact of oil subsea sediment sampling; construction Polaris, Orion, Tarn, Tabasco, Palm, and gas activity on the availability of the and use of drilling structures such as West Sak, Meltwater, Cascade, Schrader species or the stock to ensure that caisson-retained islands, ice islands, Bluff, Sag River, and Alpine. subsistence needs can be met. The Plan bottom-founded structures (steel drilling Exploration and delineation of known must provide the procedures on how caisson, or SDC), ice pads and ice roads; satellite fields identified within existing Industry will work with the affected oil spill prevention, response, and production fields would also be Native communities, including a cleanup; and site restoration and appropriate for coverage under the description of the necessary actions that remediation. provisions of this rule. will be taken to: (1) avoid interference Exploratory drilling for oil is an During the period covered by the with subsistence hunting of polar bears aspect of exploration activities. regulations, we anticipate a level of and Pacific walrus; and (2) ensure Exploratory drilling and associated activity per year at existing production continued availability of these species support activities and features include: facilities similar to that during the for subsistence use. transportation to site; setup of 90–100 timeframe of the previous regulations. We will evaluate each request for an person camps and support camps LOA for a specific activity and specific In addition, during the period of the (requiring lights, generators, snow rule, we anticipate that the levels of new location, and may condition each LOA removal, water plants, wastewater for that activity and location. For annual exploration and development plants, dining halls, sleeping quarters, activities will be similar to those of the example, an LOA issued in response to mechanical shops, fuel storage, camp a request to conduct activities on barrier previous 3 years. At this time no moves, landing strips, aircraft support, islands with known active bear dens, or additional production sites are planned health and safety facilities, data a history of polar bear denning, may be within the next 16 months, except recording facility, and communication conditioned to require avoidance of a possibly satellite fields, associated with equipment); building gravel pads; specific den site by 1 mile, intensified existing major oil and gas fields and building gravel islands with sandbag monitoring in a 1-mile buffer around the addressed through existing and concrete block protection, ice den, or avoiding the area until a specific Environmental Assessments or existing islands, and ice roads; gravel hauling; date. More information on applying for Environmental Impact Statements. gravel mine sites; road building; and receiving an LOA can be found at pipelines; electrical lines; water lines; Biological Information 50 CFR 18.27(f). road maintenance; buildings; facilities; Pacific Walrus Description of Geographic Region operating heavy equipment; digging These regulations would allow trenches; burying pipelines and The Pacific walrus (Odobenus Industry to incidentally take small covering pipelines; sea lift; water flood; rosmarus) typically inhabits the waters numbers of polar bear and Pacific security operations; dredging; moving of the Chukchi and Bering seas. Most of walrus within the same area, referred to floating drill units; helicopter support; the population congregates near the ice as the Beaufort Sea Region, as covered and drill ships such as the SDC, edge of the Chukchi Sea pack ice west by our previous regulations. This region CANMAR Explorer III, and the Kulluk. of Point Barrow during the summer. is defined by a north-south line at Development activities associated Walrus migrate north and south Barrow, Alaska, and includes all Alaska with oil and gas industry operations following the annual advance and coastal areas, State waters, and Outer include: Road construction; pipeline retreat of the pack ice. In the winter, Continental Shelf waters east of that line construction; waterline construction; walrus inhabit the pack ice of the Bering to the Canadian border. The onshore gravel pad construction; camp Sea, with concentrations occurring in region is the same north-south line at construction (personnel, dining, the Gulf of Anadyr, south of St. Barrow, 25 miles inland and east to the lodging, maintenance shops, water Lawrence Island, and south of Nunivak Canning River. The Arctic National plants, wastewater plants); Island. The current, conservative Wildlife Refuge is not included in the transportation (automobile, airplane, minimum population estimate is area covered by these regulations. and helicopter traffic; runway approximately 200,000 walrus. This construction; installation of electronic estimate is based on surveys conducted Description of Activities equipment); well drilling; drill rig in 1990 and is associated with wide In accordance with 50 CFR 18.27, transport; personnel support; and confidence intervals. However, no Industry submitted a request for the demobilization, restoration, and surveys have been conducted since then promulgation of incidental take remediation. and the actual size and trend of the regulations pursuant to section Production activities include: population is unknown, although 101(a)(5)(A) of the MMPA. Activities personnel transportation (automobiles, believed to be near the 1990 level. covered in this regulation include airplanes, helicopters, boats, rolligons, Pacific walrus use five major haulout Industry exploration, development, and cat trains, and snowmobiles) and unit sites on the west coast of Alaska. There production of oil and gas, as well as operations (building operations, oil are no known haulout sites from Point environmental monitoring associated production, oil spills, cleanup, Barrow to Demarcation Point on the with these activities. These regulations restoration, and remediation). Beaufort Sea coast.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00052 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66747

Walrus occur infrequently in the depressions to escape harsh winter Effects of Oil and Gas Industry Beaufort Sea, and although individuals winds. The reproductive potential Activities on Subsistence Uses of are occasionally seen in the Beaufort (intrinsic rate of increase) of polar bears Marine Mammals Sea, they do not occur in significant is low. The average reproductive The subsistence harvest provides numbers to the east of Point Barrow. If interval for a polar bear is 3–4 years. Alaska Natives with food, clothing, and walrus are observed, they are most The maximum reported age of materials that are used to produce arts likely to be seen in nearshore and reproduction in Alaska is 18 years. and crafts. Walrus meat is often offshore areas during the summer open- Based on these data, a female polar bear consumed, and the ivory is used to water season. They will not be may produce about 8–10 cubs in her manufacture traditional arts and crafts. encountered during the ice-covered lifetime. Polar bears are primarily hunted for season. Ringed seals (Phoca hispida) are the Walrus sightings in the Beaufort Sea primary prey species of the polar bear, their fur, which is used to manufacture have consisted solely of widely although polar bears occasionally hunt cold weather gear; however, their meat scattered individuals and small groups. bearded seals (Erignathus barbatus) and is also consumed. Although walrus and For example, while walrus have been walrus calves. Polar bears also scavenge polar bears are a part of the annual encountered and are present in the on marine mammal carcasses washed subsistence harvest of most rural Beaufort Sea, there were only five up on shore and have been known to eat communities on the North Slope of sightings of walrus between 146° and anthropogenic nonfood items such as Alaska, these species are not as 150°W during MMS sponsored aerial Styrofoam, plastics, car batteries, significant a food resource as bowhead surveys conducted from 1979 to 1995. antifreeze, and lubricating fluids. whales, seals, caribou, and fish. Pacific walrus mainly feed on bivalve Polar bears have no natural predators, Pacific Walrus mollusks obtained from bottom and they do not appear to be prone to sediments along the shallow continental death by disease or parasites. The most The Pacific walrus has cultural and shelf, typically at depths of 80 m (262 significant source of mortality is subsistence significance to Alaska ft) or less. Walrus are also known to feed humans. Since 1972, with the passage of Natives. Although it is not considered a on a variety of benthic invertebrates the MMPA, only Alaska Natives are primary food source for residents of the such as worms, snails, and shrimp and allowed to hunt polar bears in Alaska. North Slope, walrus are still taken by a some slow-moving fish; and some Bears are used by Alaska Natives for few Alaskan communities located in the animals feed on seals and seabirds. subsistence purposes, such as southern Beaufort Sea along the Mating usually occurs between January consumption and the manufacture of northern coast of Alaska, including and March. Implantation of a fertilized handicraft and clothing items. The Barrow, Nuiqsut, and Kaktovik. egg is delayed until June or July. Native harvest occurs without The primary range of Pacific walrus is Gestation lasts 11 months (a total of 15 restrictions on sex, age, number, or west and south of the Beaufort Sea. months after mating) and birth occurs season, provided that takes are non- Accordingly, few walrus inhabit, or are between April and June during the wasteful. From 1980 through 2002, the harvested in, the Beaufort Sea along the annual northward migration. Calves total annual harvest in Alaska averaged northern coast of Alaska. Therefore, the weigh about 63 kg (139 lb) at birth and 107 bears. The majority of this harvest effect to Pacific walrus of Industry are usually weaned by age two. Females (69 percent) occurred in the Chukchi activities described in this rulemaking give birth to one calf every two or more and Bering Seas area. would most likely be minimal, as they years. This reproductive rate is much Polar bears in the near-shore Alaskan would affect only those individuals lower than other pinnipeds; however, Beaufort Sea are widely distributed in inhabiting the Beaufort Sea. Walrus some walrus may live to age 35–40 and low numbers, with an average density of constitute only a small portion of the remain reproductively active until late about one bear per 30 to 50 square total marine mammal harvest for the in life. miles. Polar bears congregate on barrier village of Barrow. From 1994 to 2002, islands in the fall and winter because of 182 walrus were taken by Barrow Polar Bear available food and favorable hunters as reported through the Service Polar bears (Ursus maritimus) occur environmental conditions. Polar bears Marking, Tagging, and Reporting in the circumpolar Arctic and live in will occasionally feed on bowhead Program. Reports indicate that only up close association with polar ice. In whale carcasses on barrier islands. In to 4 of the 182 animals were taken east Alaska, their distribution extends from November 1996, biologists from the U.S. of Point Barrow, within the geographic south of the Bering Strait to the U.S.- Geological Survey observed 28 polar area of these incidental take regulations. Canada border. Two stocks occur in bears near a bowhead whale carcass on Furthermore, hunters from Nuiqsut and Alaska: the Chukchi-Bering seas stock, Cross Island, and approximately 11 Kaktovik do not normally hunt walrus whose minimum size is approximately polar bears within a 2-mile radius of east of Point Barrow and have taken 2,000; and the Southern Beaufort Sea another bowhead whale carcass near the only one walrus in that area in the last stock, which was estimated in 2002 to village of Kaktovik on Barter Island. 13 years. have 2,273 bears. From 2000 to 2003, biologists from the Females without dependent cubs Service conducted systematic coastal Polar Bear breed in the spring and enter maternity aerial surveys for polar bears from Cape Within the area covered by the dens by late November. Females with Halkett to Barter Island. During these regulations, polar bears are taken for cubs do not mate. Each pregnant female surveys they observed as many as 5 subsistence use in Barrow, Nuiqsut, and gives birth to one to three cubs, with polar bears at Cross Island and 51 polar Kaktovik where Alaska Natives utilize two-cub litters being most common. bears on Barter Island within a 2-mile parts of the bears to make traditional Cubs are usually born in December. radius of bowhead whale carcasses. In a handicrafts and clothing. Data from our Family groups emerge from their dens survey during October 2002, we Marine Mammal Management Office in late March or early April. Only observed 109 polar bears on barrier indicate that, from July 1, 1993, to June pregnant females den for an extended islands and the coastal mainland from 30, 2002, a total of 194 polar bears was period during the winter; however, Cape Halkett to Barter Island, a distance reported harvested by residents of other polar bears may burrow in of approximately 350 kilometers. Barrow; 26 by residents of the village of

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00053 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66748 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Nuiqsut; and 26 by residents of the Bears’’. Furthermore, we have received initiation of incidental take regulations, village of Kaktovik. Hunting success no evidence or reports that bears are walrus that tolerated noises produced varies considerably from year to year being deflected (i.e., altering habitat use by Industry activities were intentionally because of variable ice and weather patterns by avoiding certain areas) or harassed to protect them from more conditions. being impacted in other ways by the serious injury. Shell Western E & P Inc. Native subsistence polar bear hunting existing level of oil and gas activity near encountered several walrus close to the could be affected by oil and gas Nuiqsut to diminish their availability drillship during offshore drilling activities in various ways. Hunting areas for subsistence use; nor do we expect operations in the eastern Chukchi Sea in where polar bears are historically taken any change in the impact of future 1989. On more than one occasion, one may be viewed as tainted if an oil spill activities. walrus actually entered the moon pool were to occur at these sites. Other of the drillship. (A moon pool is the potential disturbances, such as noise Effects of Oil and Gas Industry opening to the sea on a drillship for a and vehicular traffic, could have limited Activities on Pacific Walrus and Polar marine drill apparatus. The drill effects on subsistence activities if these Bears apparatus protrudes from the ship disturbances were to occur near Pacific Walrus through the moon pool to the sea floor.) traditional hunting areas and lead to the Eventually, the walrus had to be Walrus are not present in the region displacement of polar bears. removed from the ship for its own of activity during the ice-covered season Plan of Cooperation safety. and occur only in small numbers in the A. Stationary Sources—It is highly Polar bear and Pacific walrus defined area during the open-water improbable that noise from stationary inhabiting the Beaufort Sea represent a season. From 1994 to 2000, three Pacific sources would impact walrus. small portion, in terms of the number of walrus were sighted during the open- Currently, Endicott, the saltwater animals, of the total subsistence harvest water season. In June 1996, one walrus treatment plant, and Northstar, are the for the villages of Barrow, Nuiqsut, and was observed from a seismic vessel near only offshore facilities that could Kaktovik. Despite this fact, the harvest Point Barrow. In October 1996, one produce noise that has the potential to of these species is important to Alaska walrus was sighted approximately 5 disturb walrus. Walrus are rare in the Natives. An important aspect of the miles northwest of Howe Island. In vicinity of these facilities, although one LOA process, therefore, is that prior to September 1997, one walrus was sighted walrus hauled out on Northstar Island issuance of an LOA, Industry must approximately 20 miles north of Pingok in the fall of 2001. provide evidence to us that an adequate Island. B. Mobile Sources—Open-water Plan of Cooperation has been presented Certain activities associated with oil seismic exploration produces to any affected subsistence community, and gas exploration and production underwater sounds, typically with the Eskimo Walrus Commission, the during the open-water season have the airgun arrays, that may be audible Alaska Nanuuq Commission, and the potential to disturb walrus. Activities numerous kilometers from the source. North Slope Borough. This Plan of that may affect walrus include Such exploration activities could Cooperation must provide the disturbance by: (1) Noise, including potentially disturb walrus at varying procedures on how Industry will work stationary and mobile sources, and ranges. In addition, source levels are with the affected Native communities vessel and aircraft traffic; (2) physical thought to be high enough to cause and what actions will be taken to avoid obstructions; and (3) contact with hearing damage in pinnipeds close in interfering with subsistence hunting of releases of oil or waste products. proximity to the sound. Therefore, it is polar bear and walrus. For this rule we Despite the potential for disturbance, possible that walrus within the 190 dB evaluated the effect of proposed there is no indication that walrus have re 1 µPa safety radius of seismic activities on the availability of polar been injured during an encounter by activities (Industry standard) could bears and walrus for subsistence use. industry activities on the North Slope, suffer temporary threshold shift; Although all three communities are and there has been no evidence of lethal however, the use of acoustic safety radii located in the geographic area of the takes to date. and monitoring programs are designed rule, the community most likely affected 1. Noise Disturbance to ensure that marine mammals are not by Industry activities due to its close exposed to potentially harmful noise proximity is Nuiqsut. For this rule we Reactions of marine mammals to levels. Previous open-water seismic determined that the total taking of polar noise sources, particularly mobile exploration has been conducted in bears and walrus will not have an sources such as marine vessels, vary. nearshore ice-free areas. This is the area unmitigable adverse impact on the Reactions depend on the individuals’ where any expected open-water seismic availability of these species for prior exposure to the disturbance source exploration will occur in the duration of subsistence uses during the duration of and their need or desire to be in the this rule. It is highly unlikely that the regulation. We base this conclusion particular habitat or area where they are walrus will be present in these areas, on: the results of coastal aerial surveys exposed to the noise and visual and therefore, it is not expected that conducted within the area during the presence of the disturbance sources. seismic exploration would disturb past three years; direct observations of Walrus are typically more sensitive to walrus. polar bears occurring on Cross Island disturbance when hauled out on land or C. Vessel Traffic—Noise produced by during the village of Nuiqsut’s annual ice than when they are in the water. In routine vessel traffic could potentially fall bowhead whaling efforts; anecdotal addition, females and young are disturb walrus in the Beaufort Sea. reports and recent sighting of polar generally more sensitive to disturbance However, walrus densities are highest bears by Nuiqsut residents; and data than adult males. along the edge of the pack ice, and discussed in the sections of this Noise generated by Industry activities, Industry vessel traffic typically avoids regulation titlted, ‘‘Effects of Oil and whether stationary or mobile, has the these areas. The reaction of walrus to Gas Industry Activities on Pacific potential to disturb small numbers of vessel traffic is highly dependent on Walrus and Polar Bears’’ and ‘‘Actual walrus. The response of walrus to sound distance, vessel speed, as well as Impacts of Oil and Gas Industry sources may be either avoidance or previous exposure to hunting. Walrus in Activities on Pacific Walrus and Polar tolerance. In one instance, prior to the the water appear to be less readily

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00054 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66749

disturbed by vessels than walrus hauled season, denning female bears, as well as infrequent and isolated, and will out on land or ice. In addition, barges mobile, non-denning bears, could be continue to be so in the future. and vessels associated with Industry exposed to oil and gas activities and Noise produced by stationary Industry activities travel in open water and avoid potentially affected in different ways. activities could elicit several different large ice floes or land where walrus are The best available scientific information responses in polar bears. The noise may likely to be found. Thus, vessel indicates that female polar bears act as a deterrent to bears entering the activities are likely to impact at most a entering dens, or females in dens with area, or the noise could potentially few walrus. cubs, are more sensitive than other age attract bears. Attracting bears to these D. Aircraft Traffic—Aircraft and sex groups to noises. facilities could result in a human-bear overflights may disturb walrus. Noise disturbance can originate from encounter, which could result in Reactions to aircraft vary with range, either stationary or mobile sources. unintentional harassment, lethal take, or aircraft type, and flight pattern, as well Stationary sources include: intentional hazing (under separate as walrus age, sex, and group size. Adult Construction, maintenance, repair, and authorization) of the bear. females, calves, and immature walrus remediation activities; operations at B. Mobile Sources—In the southern tend to be more sensitive to aircraft production facilities; flaring excess gas; Beaufort Sea, during the open-water disturbance. Most aircraft traffic, and drilling operations from either season, polar bears spend the majority however, is in nearshore areas, where onshore or offshore facilities. Mobile of their lives on the pack ice, which there are typically few to no walrus. sources include: Vessel and aircraft limits the chances of impacts on polar traffic; open-water seismic exploration; bears from Industry activities. Although 2. Physical Obstructions winter vibroseis programs; geotechnical polar bears have been documented in Based on known walrus distribution surveys; ice road construction and open water, miles from the ice edge or and numbers in the Beaufort Sea near associated vehicle traffic; drilling; ice floes, this is a relatively rare Prudhoe Bay, it is unlikely that walrus dredging; and ice-breaking vessels. occurrence. In the open-water season, movements would be displaced by A. Stationary Sources—All Industry activities are generally limited offshore stationary facilities, such as the production facilities on the North Slope to vessel-based exploration activities, Northstar or Endicott, or vessel traffic. in the area to be covered by this such as ocean-bottom cable (OBC) and There was no indication that the walrus rulemaking are currently located within shallow hazards surveys. These that used Northstar Island as a haulout the landfast ice zone. Typically, most activities avoid ice floes and the multi- in 2001 was displaced from its polar bears occur in the active ice zone, year ice edge. movements. Vessel traffic could far offshore, hunting throughout the C. Vessel Traffic—Vessel traffic would temporarily interrupt the movement of year; although some bears also spend a most likely result in short-term walrus, or displace some animals when limited amount of time on land, coming behavioral disturbance only. During the vessels pass through an area. This ashore to feed, den, or move to other open-water season, most polar bears displacement would probably have areas. At times, usually during the fall remain offshore in the pack ice and are minimal or no effect on animals and season when the ice edge is near shore not typically present in the area of would last no more than a few hours at and then quickly retreats northward, vessel traffic. Barges and vessels most. bears may remain along the coast or on associated with Industry activities travel barrier islands for several weeks until in open water and avoid large ice floes. 3. Contact With Releases of Oil or Waste the ice returns. D. Aircraft Traffic—Routine aircraft Products During the ice-covered season, noise traffic should have little to no effect on The potential releases of oil and waste and vibration from Industry facilities polar bears. However, extensive or products associated with oil and gas may deter females from denning in the repeated overflights of fixed-wing exploration and production during the surrounding area, even though polar aircraft or helicopters could disturb open-water season and the associated bears have been known to den in close polar bears throughout the year. potential to disturb walrus are discussed proximity to industrial activities. In Behavioral reactions of non-denning following the polar bear discussion in 1991, two maternity dens were located polar bears should be limited to short- this section. on the south shore of a barrier island term changes in behavior and would within 2.8 km (1.7 mi) of a production have no long-term impact on Polar Bear facility. Recently, industrial activities individuals and no impacts on the polar Oil and gas activities could impact were initiated while two polar bears bear population. In contrast, denning polar bears in various ways during both denned close to the activities. During bears may abandon or depart their dens open-water and ice-covered seasons. the ice-covered seasons of 2000–2001 early in response to noise and vibrations These impacts could result from the and 2001–2002, dens known to be active produced by extensive aircraft following: (1) Noise from stationary were located within approximately 0.4 overflights. Mitigation measures, such operations, construction activities, km and 0.8 km (0.25 mi and 0.5 mi) of as minimum flight elevations over polar vehicle traffic, vessel traffic, aircraft remediation activities on Flaxman bears, or areas of concern, and flight traffic, and geophysical and geological Island without any observed impact to restrictions around known polar bear exploration activities; (2) physical the polar bears. dens, are routinely implemented to obstruction, such as a causeway or an In contrast, information exists reduce the likelihood that aircraft artificial island; (3) human-animal indicating that polar bears within the disturbs bears. encounters; and (4) oil spills or contact geographic area of these regulations may E. Seismic Exploration—Although with hazardous materials or production have abandoned dens in the past due to polar bears are typically associated with wastes. exposure to human disturbance. For the pack ice during summer and fall, example, in January 1985, a female open-water seismic exploration 1. Noise Disturbance polar bear may have abandoned her den activities can encounter polar bears in Noise produced by Industry activities due to rollagon traffic, which occurred the central Beaufort Sea in late summer during the open-water and ice-covered 250–500 m from the den site. While or fall. It is unlikely that seismic seasons could potentially result in takes such events may have occurred, exploration activities or other of polar bears. During the ice-covered information indicates they have been geophysical surveys during the open-

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00055 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66750 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

water season would result in more than of polar bears because they extend cracker shells) or other forms of temporary behavioral disturbance to continuously from the coastline to the deterrents (e.g., the vehicle itself, polar bears. Polar bears normally swim offshore facility. Yet, because polar vehicle horn, vehicle siren, vehicle with their heads above the surface, bears appear to have little or no fear of lights, spot lights, etc.). The purpose of where underwater noises are weak or man-made structures and can easily these plans and training is to eliminate undetectable. climb and cross gravel roads and the potential for lethal takes of bears in Noise and vibrations produced by oil causeways, bears have frequently been defense of human life. No bears have and gas exploration and production observed crossing existing roads and been killed and no Industry personnel activities during the ice-covered season causeways in the Prudhoe Bay oilfields. have been injured as a result of Industry could potentially result in impacts on Offshore production facilities, such as activities since regulations have been in polar bears. During this time of year, Northstar, may be approached by polar place. Therefore, we believe, such denning female bears as well as mobile, bears, but due to their layout (i.e., mitigation measures have minimized non-denning bears could be exposed to continuous sheet pile walls around the polar bear/human interactions and will and affected differently by potential perimeter) the bears may not gain access continue to be requirements of future impacts from oil and gas activities. to the facility itself. This situation may LOAs as appropriate. Disturbances to denning females, either present a small scale, local obstruction on land or on ice, are of particular to the bears’ movement, but also Although very unlikely, it is possible concern. As part of the LOA application minimizes the likelihood of human-bear that on-ice vehicle traffic could for seismic surveys during denning encounters. physically run over an unidentified season, Industry provides us with the polar bear den. Known dens around the proposed seismic survey routes. To 3. Human-Polar Bear Encounters oilfield are monitored by the Service minimize the likelihood of disturbance Encounters with humans can result in and Industry. The oil and gas industry to denning females, we evaluate these the harassment or (rarely) the death of communicates with the Service to routes along with information about polar bears. Unlike most mammals, determine the location of Industry’s known polar bear dens, historic denning polar bears typically do not fear humans activities relative to known dens. sites, and probable denning habitat. and are extremely curious. Polar bears General LOA provisions require A standard condition of LOAs are most likely to encounter humans Industry operations to avoid known requires Industry to maintain a 1-mile during the ice-covered season, when polar bear dens by 1 mile. There is the buffer between survey activities and both humans and bears are found on the possibility that an unknown den may be known denning sites. In addition, we land-fast ice and adjacent coastline. encountered during Industry activities. may require Industry to avoid denning Polar bears can also come in contact If a previously unknown den is habitat until bears have left their dens. with humans along the coast or on identified, communication between To further reduce the potential for islands, particularly near locations Industry and the Service and the disturbance to denning females, we where subsistence whalers haul implementation of mitigation measures, have conducted research, in cooperation bowhead whales on shore to butcher such as the 1-mile exclusion area with Industry, to enable us to accurately them. around the den, help ensure that detect active polar bear dens. We have Depending upon the circumstances, disturbance is minimized. evaluated the use of remote sensing bears can be either repelled from or techniques, such as Forward Looking attracted to sounds, smells, or sights Contact With Oil or Waste Products by Infrared (FLIR) imagery and the use of associated with Industry activities. In Pacific Walrus and Polar Bears scent-trained dogs to locate dens. Based the past, such interactions have been The discharge of oil or waste products on these methodologies, the use of FLIR addressed through the LOA process into the environment could potentially technology coupled with using trained which requires the applicant to develop dogs to locate occupied polar bear dens a polar bear interaction plan for each impact polar bears and walrus as a verification is a viable technique operation. These plans outline the steps depending on the location (i.e., onshore that could help to minimize impacts the applicant will take, such as garbage or offshore), size of the spill, from oil and gas industry activities on disposal procedures, to minimize environmental conditions, and success denning polar bears. These techniques impacts to polar bears by reducing the of cleanup measures. Spills of crude oil will be included as conditions of LOAs attraction of Industry activities to polar and petroleum products associated with as appropriate. In addition, Industry has bears. Interaction plans also outline the onshore production facilities during ice- sponsored cooperative research chain of command for responding to a covered and open-water seasons are evaluating noise and vibration polar bear sighting. In addition to usually minor spills (i.e., 1 to 50 barrels propagation through substrates and the interaction plans, Industry personnel per incident) that are contained and received levels of noise and vibration in participate in polar bear interaction cleaned up immediately. They can polar bear dens. This information will training while on site. Employee occur during normal operations (e.g., be used to refine site-specific mitigation training programs are designed to transfer of fuel, handling of lubricants measures. educate field personnel about the and liquid products, and general dangers of bear encounters and to maintenance of equipment). Fueling 2. Physical Obstructions implement safety procedures in the crews have personnel that are trained to There is little chance that Industry event of a bear sighting. The result of handle operational spills. If a small facilities would act as physical barriers these polar bear interaction plans and offshore spill occurs, spill response to movements of polar bears. Most training allows personnel on site to vessels are stationed in close proximity facilities are located onshore where detect bears and respond appropriately. and respond immediately. Production polar bears are only occasionally found. Most often, this response involves related spills, generally larger, could The offshore and coastal facilities are deterring the bear from the site. occur at any production facility or most likely to be approached by polar Personnel are instructed to leave an area pipeline connecting wells to the Trans- bears. The Endicott Causeway and West where bears are seen. If it is not possible Alaska Pipeline System. These large Dock facilities have the greatest to leave, in most cases bears can be spills have been modeled to examine potential to act as barriers to movements displaced by using pyrotechnics (e.g., potential impacts on marine mammals.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00056 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66751

1. Physical Effects of Oil on Pacific inflammation and corneal erosions walrus from using the area as a food Walrus and Polar Bear during the 24-hour experiment. When source. the animals were returned to Walrus could contact oil in water and 2. Potential Oil Spill and Waste uncontaminated water, the eye on potential haulouts (ice or islands), Products Impacts on Pacific Walrus and while polar bears could contact spilled condition resolved within 3–4 days. Polar Bears oil in the water, on ice, or on land. In This reaction could be expected in other marine mammals, such as polar bears A. Pacific Walrus. Onshore oil spills 1980, Canadian scientists performed would not impact walrus unless oil experiments that studied the effects to and walrus. B. Ingestion and Inhalation of Oil— moved into the offshore environment. polar bears of exposure to oil. More During the open-water season, if a small information is available regarding the Oil ingestion by polar bears through consumption of contaminated prey, and spill occurs at offshore facilities or by effects of oil on polar bears than walrus. vessel traffic, few walrus would likely Effects on experimentally oiled polar by grooming or nursing, could have pathological effects, depending on the encounter the oil. In the event of a larger bears (where bears were forced to spill during the open-water season, oil remain in oil for prolonged periods of amount of oil ingested and the individual’s physiological state. Death in the water column could drift offshore time) included acute inflammation of and possibly encounter a limited the nasal passages, marked epidermal could occur if a large amount of oil were ingested or if volatile components of oil number of walrus. During the ice- responses, anemia, anorexia, and covered season, spilled oil would be biochemical changes indicative of were aspirated into the lungs. Indeed, two of three bears died in the Canadian incorporated into the thickening sea ice. stress, renal impairment, and death. In During spring melt, the oil would then experimental oiling, many effects did experiment and it was suspected that the ingestion of oil was a contributing travel to the surface of the ice, via brine not become evident until several weeks channels, where most could be collected after exposure to oil. factor to the deaths. Experimentally oiled bears ingested much oil through by spill response activities. A. External Oiling— Oiling of the pelt Few walrus are found in the Beaufort grooming. Much of it was eliminated by causes significant thermoregulatory Sea east of Barrow and low to moderate vomiting and in the feces, but some was problems by reducing the insulation numbers are found along the pack-ice value of the pelt in polar bears. absorbed and later found in body fluids edge 241 km (150 mi) or more northwest Excessive oiling could cause mortality and tissues. of Prudhoe Bay. Thus, the probability of as well. Polar bears rely on their fur as Ingestion of sublethal amounts of oil individual walrus occurring in the well as their layer of blubber for thermal can have various physiological effects vicinity of industry and encountering insulation. Experiments on live polar on a polar bear, depending on whether oil, as a result of an oil spill from bears and pelts showed that the thermal the animal is able to excrete and/or Industry activities, is low. value of the fur decreased significantly detoxify the hydrocarbons. Petroleum B. Polar Bear. Polar bears could after oiling, and oiled bears showed hydrocarbons irritate or destroy encounter oil spills during the open- increased metabolic rates and elevated epithelial cells lining the stomach and water and ice-covered seasons in skin temperatures. Irritation or damage intestine, and thereby affect motility, offshore or onshore habitat. Although to the skin by oil may further contribute digestion, and absorption. Polar bears the majority of the Southern Beaufort to impaired thermoregulation. may exhibit these types of symptoms, Sea polar bear population spends a large Furthermore, an oiled bear would ingest such as affected motility, digestion, and amount of its time offshore on the pack oil because it would groom in order to absorption if they ingest oil. ice, individual bears could encounter oil restore the insulation value of the oiled Polar bears and walrus swimming in, from a spill regardless of ocean fur. In one field observation, biologists or bears walking adjacent to, an oil spill conditions. documented a bear in Cape Churchill, could inhale petroleum vapors. Vapor Small spills (1–50 barrels) of oil or Manitoba, with lubricating oil matted inhalation by polar bears and walrus waste products throughout the year by into its fur on parts of its head, neck, could result in damage to various Industry activities could impact small and shoulders. The bear was re-sighted systems, such as the respiratory and the numbers of bears. As stated previously, two months later, at which time he had central nervous systems, depending on the effects of fouling fur or ingesting oil suffered substantial hair loss in the the amount of exposure. or wastes, depending on the amount of contaminated areas. Four years later, the C. Indirect Effects of Oil—Oil may oil or wastes involved, could be short bear was recaptured and no skin or hair affect food sources of walrus and polar term or result in death. In April 1988, damage was detectable, which suggests bears. A local reduction in ringed seal a dead polar bear was found on Leavitt that while oiling can damage the fur and numbers as a result of direct or indirect Island, approximately 9.3 km (5 nmi) skin, in some instances this damage is effects of oil could, therefore, northeast of Oliktok Point. The cause of only temporary. temporarily affect the local distribution death was determined to be poisoning Walrus do not rely on fur for thermal of polar bears. A reduction in density of by a mixture that included ethylene insulation, using a layer of blubber for seals as a direct result of mortality from glycol and Rhodamine B dye; however, warmth. Hence, they would be less contact with spilled oil could result in the source of the mixture was unknown. susceptible to similar insulative and polar bears not using a particular area During the ice-covered season, pelt impacts of external oiling than for hunting. Possible impacts from a loss mobile, non-denning bears would have bears. of a food source could reduce a higher probability of encountering oil Petroleum hydrocarbons can also be recruitment or survival. Also, seals that or other production wastes than irritating or destructive to eyes and die as a result of an oil spill could be denning females. Current management mucous membranes, and repeated scavenged by polar bears. This would practices put in place by Industry exposure could have detrimental increase bears’ exposure to minimize the potential for such consequences to polar bears and walrus. hydrocarbons and could result in lethal incidents by requiring the proper use, In one experimental study, ringed seals impact or reduced survival to individual storage, and disposal of hazardous quickly showed signs of eye irritation bears. Additionally, potentially lethal materials. In the event of an oil spill, it after being immersed in water covered impacts caused by an oil spill to an is also likely that polar bears would be by crude oil. This progressed to severe area’s benthic community could divert deliberately hazed to move them away

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00057 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66752 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

from the area, further reducing the Actual Impacts of Oil and Gas Industry Twenty-one percent of all bear-human likelihood of impacting the population. Activities on Pacific Walrus and Polar interactions (21 of 101 sightings) To date, large oil spills from Industry Bears involved anthropogenic attractants, such as garbage dumpsters and landfills, activities in the Beaufort Sea and coastal Pacific Walrus regions that have impacted polar bears where these attractants altered the bear’s have not occurred, although the The actual impact to Pacific walrus in behavior. Sixty-five percent of polar development of offshore production the central Beaufort Sea from oil and gas bear-human interactions (66 of 101 facilities has increased the potential for activities has been minimal. From 1994 sightings) involved Level B harassment large offshore oil spills. In a large spill to 2000, only three Pacific walrus were to maintain human and bear safety by (e.g., 3,600 barrels: the size of a rupture encountered in the Beaufort Sea. All preventing bears from approaching in the Northstar pipeline and a complete were sighted during open-water seismic facilities and people. We have no drain of the subsea portion of the programs. indication that these types of encounters that cause this type of minor alteration pipeline), oil would be influenced by Polar Bear seasonal weather and sea conditions. of the behavior and movement of individual bears have any long-term These would include temperature, Actual impacts on polar bears by the effects on those bears, related to winds, and, for offshore events, wave oil and gas industry during the past 30 recruitment or survival. We, therefore, action and currents. Weather and sea years have been minimal as well. Polar believe that the small number and types conditions would also affect the type of bears have been encountered at or near of encounters anticipated to occur equipment needed for spill response most coastal and offshore production between polar bears and Industry are and how effective spill cleanup would facilities, or along the roads and unlikely to have any significant effect be. For example, spill response has been causeways that link these facilities to the mainland. During this time, only 2 on the polar bear population. unsuccessful in the cleanup of oil in polar bear deaths related to oil and gas broken ice conditions. These factors, in Risk Assessment Analysis activities have occurred. In winter turn, would dictate how large spills 1968–1969, an industry employee on For Pacific walrus and polar bears, oil impact polar bear habitat and numbers. the Alaskan North Slope shot and killed spills are of most concern when they The major concern regarding large oil a polar bear. In 1990 a female polar bear occur in the marine environment, where spills is the impact a spill would have was killed at a drill site on the west side spilled oil can accumulate at the water on the survival and recruitment of the of Camden Bay. In contrast, 33 polar surface and ice edge, in leads, and Southern Beaufort Sea polar bear bears were killed in the Canadian similar areas of importance to marine population. Currently, this bear Northwest Territories from1976 to 1986 mammals. Thus, offshore production population is approximately 2,200 due to encounters with industry. Since activities, such as Northstar, have the bears. The most recent population the beginning of the incidental take potential to cause negative impacts on growth rate was estimated at 2.4 percent program, including measures that marine mammals because as additional annually based on data from 1982 minimize impacts to the species, no offshore oil exploration and production through 1992, although the population polar bears have been killed due to occurs, the potential for large spills is believed to have slowed its growth or encounters associated with current increases. stabilized since 1992. In addition, the Industry activities in the Prudhoe Bay Due to the concern of a potential maximum sustainable harvest is 80 area (Alpine to Badami). offshore oil spill, a risk assessment was bears for this population (divided The majority of actual impacts on performed to investigate the probability between Canada and Alaska). In Alaska, polar bears have resulted from direct of mortality in polar bears due to an oil the annual subsistence harvest has human-bear encounters. Monitoring spill and the likelihood of occurrence in fluctuated around 36 bears. The annual efforts by Industry required under various ice conditions. Pacific walrus subsistence harvest for the Southern previous regulations for the incidental were not included in the risk Beaufort Sea population (Alaska and take of polar bears and walrus have assessment due to a lack of data Canada combined) has been documented various types of interaction regarding walrus abundance and approximately 62 bears. between polar bears and Industry. distribution in the Beaufort Sea and The bear population may be able to During a 7-year period (1994–2000), because small numbers are present only sustain the additional mortality caused while incidental take regulations were seasonally in the Beaufort Sea. by a large oil spill of a small number of in place, Industry reported 258 polar The Northstar production field was bears, such as 1–5 individuals; however, bear sightings. During this period, polar used as a basis for the assessment the additive effect of numerous bear bears were sighted during 32 of the 115 because Northstar is currently the only deaths (i.e., in the range of 20–30) activities covered by incidental take offshore production field not connected caused by an oil spill or secondary regulations. Approximately two-thirds to the mainland and serviced by an effects of the spill caused through a of the sightings (171 of 258 sightings) island. Northstar transports crude oil local reduction in seal productivity or occurred during production activities, from a gravel island in the Beaufort Sea scavenging of oiled seal carcasses which suggests that Industry activities to shore via a 5.96-mile buried subsea coupled with the subsistence harvest that occur on or near the Beaufort Sea pipeline. The pipeline is buried in a and other potential impacts, both coast have a greater possibility for trench in the sea floor deep enough to natural and human-induced, may encountering polar bears than other reduce the risk of damage from ice reduce population rates of recruitment Industry activities. Sixty-one percent of gouging and strudel scour (i.e., erosion and survival. The removal rate of bears polar bear sightings (157 of 258 to the sea floor caused by large volumes from the population would then sightings) consisted of observations of of water siphoning at high velocities increase higher than what could be polar bears traveling through or resting through openings in the sea ice resulting sustained by the population, potentially near the monitored areas without a in unstable pipeline bedding). causing a decline in the bear population perceived reaction to human presence, Production of Northstar began in 2001, and affecting bear productivity and while 101 polar bear sightings involved and currently 70,000 barrels of oil pass subsistence use. bear-human interactions. through the pipeline daily.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00058 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66753

The quantitative rationale for a decreasing the period would decrease the open water scenario, the estimated negligible impact assessment was based the risk. We assumed that containment number of bears killed ranged from less on a risk assessment that considered oil of oil in broken-ice conditions would than 1 to 78 bears, with a median of 8 spill probability estimates for the not be effective; however, any bears. In the broken ice scenario, results Northstar production field, an oil spill successful containment of oil under ranged from less than 1 to 108, with a trajectory model, and a polar bear other water conditions would median of 21. These results are based on distribution model. The Northstar FEIS correspondingly reduce the risk of an ‘‘average’’ distribution of polar bears provided estimates of the probability oiling to wildlife. We assumed that and do not include potential aggregation that one or more spills greater than deterrent hazing of wildlife did not take of bears, such as on Cross Island in the 1,000 barrels of oil (a large volume spill) place. If instituted, hazing could reduce fall. will occur over the project’s life of 15 the likelihood of polar bears years. We considered only spill encountering oil. We assumed that polar The Service then analyzed the spill probabilities for the drilling platform bear distribution was not affected by trajectory and polar bear distribution to and subsea pipeline, as these are the sights, smells, or sounds associated with estimate the probability of an oil spill spill locations that would affect polar a spill and that polar bears were neither during the 16-month regulation period bears. attracted to nor displaced by these and the likelihood of occurrence of oil factors. spills causing mortality for various Methodology Similarly, the risk assessment model numbers of bears. Assuming this Initially, Applied Sciences Associates, accounted for average movements and probability was uniform throughout the Inc., was contracted by BP Exploration likelihood of polar bears being present year, the probability during any Alaska Inc. to run the OILMAP oil spill in any given location based on a history particular set of ice conditions was trajectory model. The size of the of movements from satellite-collared proportional to the length of those modeled spills was set at 3,600 barrels, females. The model did not consider conditions. The probability of polar bear simulating rupture and drainage of the aggregations of polar bears that may be mortality in the event of an oil spill was entire subsea pipeline. Each spill was present seasonally in the study area, nor calculated from mortality levels in modeled by tracking the location of 100 did it consider whether other sex and excess of 5, 10, and 20 bears. Likelihood ‘‘spillets,’’ each representing 36 barrels. age classes of polar bears have of occurrence is the product of the In the model, spillets were driven by movements similar to adult females. If probabilities of spill and mortality. wind, and their movements were aggregations were to occur, then the risk Hence, the overall likelihood is the sum stopped by the presence of sea ice. Open to polar bears could increase. If the of likelihoods over all ice conditions. water and broken ice scenarios were distribution of other sex-age classes each modeled with 250 simulations. A differs from adult females, then risk may Results solid ice scenario was also modeled, in correspondingly increase or decrease for which oil was trapped beneath the ice these sex-age classes. We calculated that the probability of and did not spread. In this event, we Lastly, we assumed that polar bears a spill that will cause mortality of one found it unlikely that polar bears will located within the distribution grid that or more bears is 0.4–1.3 percent. As the contact oil, and therefore removed this intersected with oil spillets modeled in threshold number of bears is increased, scenario from further analysis. Each the trajectory model were oiled and that the likelihood of that event decreases; simulation was run to cover a period of mortality occurred, although this may the likelihood of taking more bears 4 days, with no cleanup or containment not occur naturally. In evaluating the becomes less and less. Thus, the efforts simulated. At the end of each impacts of all these assumptions, we probability of a spill that will cause a simulation, the size and location of each determined that the assumptions that mortality of 5 or more bears is 0.3–1.1 spill was represented in a geographic overestimate and underestimate percent; for 10 or more bears is 0.3–0.9 information system, or GIS. mortalities were generally in balance. percent; and for 20 or more bears is 0.1– The trajectory model was dependent Impacts to polar bears from the oil 0.5 percent. We note that the values of on numerous assumptions, some of spill trajectory model were derived these probabilities differ slightly from which underestimate, while others using telemetry data from the U.S. those presented in the Proposed Rule. overestimate, the potential risk to polar Geological Survey, Biological Resources The reason for this difference is that the bears. These assumptions relate to, and Division (USGS). Telemetry data suggest Proposed Rule relied on calculations for include: variation in spill probabilities that polar bears are widely distributed probabilities of an oil spill resulting in during the year; the length of time that in low numbers across the Beaufort Sea polar bear mortality for a three-year oil was in the environment and was with a density of about one bear per 30– period (i.e., the length of time used subject to the spill trajectory model; 50 square miles. Movement and during the last rulemaking). The whether or not containment occurred in distribution information was derived corrected values presented in this rule various runs of the trajectory model; from radio and satellite relocations of reflect the probabilities over a 16-month types of efforts and effects of efforts to collared adult females. The USGS period. Although the values differ deter wildlife during spills; contact by developed a polar bear distribution slightly, the final results of the analysis bears with a modeled spillet resulting in model based on an extensive telemetry are similar; there is still a very low mortality; and the presence and size of data set of over 10,000 relocations. probability that there will be an oil spill bear groups. We assumed that the Using a technique called ‘‘kernel that will result in bear mortality. annual probability of a spill was equal smoothing,’’ they created a grid system during any season of the year. Any centered over Northstar and estimated In addition, using exposure variables differences in seasonal spill the number of bears expected to occur and production estimates from the probabilities would have a within each 0.25-km2 grid cell. Each of Northstar EIS, we estimated that the corresponding increase or decrease in the simulated oil spills was overlaid likelihood of one or more spills greater risk. The model assumed oil would with the polar bear distribution grid. In than 1,000 barrels in size occurring in remain in the environment for 4 days; the simulation, if a spillet passed the marine environment is 1–5 percent increasing that period of time would through a grid cell, the bears in that cell during the period covered by the increase the risk to polar bears, while were considered killed by the spill. In regulations.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00059 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66754 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Discussion spills, the rapid response system in disturbances are expected to be The greatest source of uncertainty in place to clean up spills, and the primarily nonlethal, short-term our calculations was the probability of protocol available to deter bears away behavioral reactions resulting in an oil spill occurring. The oil spill from the affected area for their safety, displacement with minimal impacts to probability estimates for the Northstar we concluded that onshore spills would individuals. Polar bears could be Project were calculated using data for have little impact on the polar bear displaced from the immediate area of sub-sea pipelines outside of Alaska and population. Therefore, the total activity due to noise and vibrations. outside of the Arctic. These spill expected taking of polar bear caused by They could be attracted to sources of probability estimates, therefore, do not Industry discharge of oil or waste noise and vibrations out of curiosity, reflect conditions that are routinely products into the environment will have which could result in human-bear encountered in the Arctic, such as no more than a negligible impact on this encounters. Denning females with cubs permafrost, ice gouging, and strudel species. could prematurely abandon their dens scour. They may include other In making this finding, we are due to noise and vibrations produced by conditions unlikely to be encountered following Congressional direction in certain industrial activities at close in the Arctic, such as damage from balancing the potential for a significant distances. Also, noise and vibration anchors and trawl nets. Consequently, impact with the likelihood of that event from stationary sources could keep we have some uncertainty about oil spill occurring. The specific Congressional females from denning in the vicinity of probabilities as presented in the direction that justifies balancing the source. These disturbances are not Northstar FEIS. However, if the probabilities with impacts follows: expected to affect the rates of probability of a spill were actually twice If potential effects of a specified recruitment or survival of the Southern the estimated value, the probability of a activity are conjectural or speculative, a Beaufort Sea polar bear population. spill that will cause a mortality of one finding of negligible impact may be Contact with or ingestion of oil could or more bears is still low (about 6 appropriate. A finding of negligible also potentially affect polar bears. Small percent). impact may also be appropriate if the oil spills are likely to be cleaned up In addition to the results from the risk probability of occurrence is low but the immediately and should have little analysis, anecdotal information potential effects may be significant. In opportunity to affect polar bears. The supported our determination that any this case, the probability of occurrence probability of a large spill occurring is take associated with Northstar will have of impacts must be balanced with the very small. However, if such a spill a negligible impact on the Beaufort Sea potential severity of harm to the species were to occur at an offshore oil facility, polar bear population. This information or stock when determining negligible polar bears could come into contact was based on observations of polar bear impact. In applying this balancing test, with oil. The impact of a large spill aggregations on barrier islands and the Service will thoroughly evaluate the would depend on the location and size coastal areas in the Beaufort Sea, which risks involved and the potential impacts of the spill, environmental factors, and may occur for brief periods in the fall, on marine mammal populations. Such the success of cleanup measures. usually 4 to 6 weeks. The presence and determination will be made based on The Service estimates that only a duration of these aggregations are the best available scientific information. small number of polar bear takes will influenced by the presence of sea ice 53 FR at 8474; accord, 132 Cong. Rec. occur during the length of the near shore and the availability of marine S 16305 (Oct. 15, 1986). regulations. These takes are expected to mammal carcasses, notably bowhead Summary of Take Estimate for Pacific be nonlethal. However, it is possible whales from subsistence hunts. In order Walrus and Polar Bear that a few unintentional lethal takes for any take associated with a Northstar could occur under low probability oil spill to have more than a negligible Pacific Walrus circumstances. For example, a scenario impact on polar bears, an oil spill would Since walrus are typically not found of an unintentional lethal take could be have to occur, an aggregation of bears in the region of Industry activity, the a road accident where a vehicle strikes would have to be present, and the spill probability is small that Industry and kills a polar bear. would have to contact the aggregation. activities, such as offshore drilling Based on past LOA monitoring We believe the probability of all these operations, seismic, and coastal reports, we believe that takes resulting events occurring simultaneously is low, activities, will affect walrus. Walrus from the interactions between Industry but are not quantified. observed in the region have typically and Pacific walrus and polar bears have We concluded that if an offshore oil been lone individuals, further reducing had a negligible impact on these spill were to occur during the fall or the number of potential takes expected. species. Additional information, such as spring broken-ice periods, a significant Only 3 walrus were observed by recorded subsistence harvest levels and impact to polar bears could occur. We Industry during its activities between incidental observations of polar bears also recognize that some of the impact 1994 to 2000. In addition, the majority near shore, suggests that these may result from latent effects of the spill of walrus hunted by Barrow residents populations have not been adversely on bears themselves or locally through were harvested west of Point Barrow, affected. The projected levels of secondary impacts to the environment outside of the area covered by incidental activities during the period covered by and its value for feeding, such as take regulations, while Kaktovik the regulations (existing development foraging or scavenging on oiled seal harvested only one walrus. Given this and production activities, as well as carcasses. In balancing the level of information, no more than a small proposed exploratory activities) are potential impacts with the probability of number of walrus are likely to be taken similar in scale to previous levels. In occurrence, however, we conclude that during the length of this rule. Any takes addition, current mitigation measures the probability of a large-volume spill would most likely be nonlethal. will be kept in place. that would cause latent effects that Conclusions result in significant polar bear takes is Polar Bear low. Industry exploration, development, Based on the previous discussion, we Additionally, because of the small and production operations could make the following findings regarding volume of oil associated with onshore potentially disturb polar bears. These this action.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00060 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66755

Impact on Species interference with normal breeding, ‘‘Effects of Oil and Gas Industry The Pacific walrus is only feeding, and possible migration patterns Activities on Pacific Walrus and Polar occasionally found during the open- to ensure that the effects to the species Bears’’ and ‘‘Actual Impacts of Oil and water season in the Beaufort Sea. remain negligible. We may add Gas Industry Activities on Pacific Industry impacts would be no more additional measures depending upon Walrus and Polar Bears,’’ and also than negligible for the walrus site-specific and species-specific because there is no indication of past population. concerns. Conditions can include the adverse effects, and because past Plans The Beaufort Sea polar bear following: (1) These regulations do not of Cooperation appear to have been population is widely distributed authorize intentional taking of polar effective. In addition, regular throughout its range. Polar bears bear or Pacific walrus. (2) For the communication between the Industry typically occur in low numbers in protection of pregnant polar bears and Native communities through Plans coastal and nearshore areas where most during denning activities (den selection, of Cooperation will further reduce the Industry activities occur. Hence, birthing, and maturation of cubs) in likelihood of interference with known and confirmed denning areas, subsistence harvest. Therefore, we find impacts that might be significant for Industry activities may be restricted in that the anticipated effects of Industry individuals or small groups of animals specific locations during specified times relevant to subsistence are unlikely to are expected to be no more than of the year. These restrictions will be have an adverse effect on subsistence negligible for the polar bear population applied on a case-by-case basis after use. as a whole. assessing each LOA request. In potential If there is evidence during the period We reviewed the effects of the oil and denning areas, we will advise operators of the rule that oil and gas activities may gas industry activities on marine using a den habitat map and, as adversely affect the availability of polar mammals, which included impacts from appropriate, will require pre-activity bear or walrus for take for subsistence stationary and mobile sources such as surveys (e.g., aerial surveys, FLIR uses, we will reevaluate our findings noise, physical obstructions, and oil surveys, or polar bear scent-trained regarding permissible limits of take and spills. Based on past LOA monitoring dogs) to determine the presence or the measures required to ensure reports, we conclude that any take absence of dens; in known denning continued subsistence hunting reasonably likely to or reasonably areas we may require enhanced opportunities. expected to occur as a result of monitoring during activities. (3) Each Monitoring and Reporting projected activities will have a activity covered by an LOA requires a negligible impact on polar bear and site-specific plan of operation and a site- We require an approved plan for Pacific walrus populations. specific polar bear interaction plan. The monitoring and reporting the effects of The Northstar development is purpose of the required plans is to oil and gas industry exploration, currently the only offshore facility in ensure that the level of activity and development, and production activities production with a subsea pipeline. possible takes will be consistent with on polar bear and walrus prior to Concerns about potential oil spills in our finding that the cumulative total of issuance of an LOA. Monitoring plans the marine environment as a result of incidental takes will have a negligible are required to determine effects of oil this development were raised in the impact on polar bear and Pacific walrus, and gas activities on polar bear and Northstar FEIS. We have analyzed the and where relevant, will not have an walrus in the Beaufort Sea and the likelihood of an oil spill in the marine unmitigable adverse impact on the adjacent northern coast of Alaska. environment of the magnitude necessary availability of these species for Monitoring plans must identify the to kill a significant number of polar subsistence uses. methods used to assess changes in the bears, and found it to be minimal. Thus, movements, behavior, and habitat use of after considering the cumulative effects Impact on Subsistence Take polar bear and walrus in response to of existing development and production We find, based on the best scientific Industry activities. Monitoring activities activities, the likelihood of impacts information available, including the are summarized and reported in a occurring, and proposed exploratory results of monitoring data, that any take formal report each year. The applicant activities, both onshore and offshore, we reasonably likely to result from the must submit a monitoring and reporting find that the total expected takings effects of Industry activities during the plan at least 90 days prior to the resulting from oil and gas industry period of the rule in the Beaufort Sea initiation of an activity. We base each exploration, development, and and adjacent northern coast of Alaska year’s monitoring objective on the production activities will have a will not have an unmitigable adverse previous year’s monitoring results. For negligible impact on polar bear and impact on the availability of polar bears exploration activities the applicant must Pacific walrus populations. and Pacific walrus for taking for submit a final monitoring report to us Even though the probability of an oil subsistence uses. no later than 90 days after the spill that will cause significant impacts Polar bears are hunted primarily completion of the activity. Since to the walrus and polar bear population during the ice-covered season, and the development and production activities is extremely low, in the event of a proposed activities are expected to have are continuous and long-term, we will catastrophic spill we will reassess the a negligible effect on the distribution, issue LOAs, which include conditions impacts to polar bear and walrus and movement, and numbers of polar bears for the submittal of monitoring and reconsider the appropriateness of found during this time period in the reporting plans for the life of the activity authorizations for incidental taking regulation area. Walrus are primarily or until the expiration of the through section 101(a)(5)(A) of the hunted during the open-water season, regulations, whichever occurs first. MMPA. and the proposed oil and gas activities Prior to of each year, we will Our finding of ‘‘negligible impact’’ are also expected to have a negligible require that the operator submit applies to oil and gas exploration, effect on the distribution, movement, development and production activity development, and production activities. and numbers of walrus in the region. monitoring results of the previous year’s As with our past incidental take We reached these conclusions based on activity. We require approval of the regulations for these actions, each LOA data and analyses discussed in the monitoring results for continued will require actions to minimize sections of this regulation titled, coverage under the LOA.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00061 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66756 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

Discussion of Comments on the this level and the effect on polar bear polar bears reduces potential impacts to Proposed Rule population rates of recruitment and polar bears and thus reduces potential The proposed rule, which was survival and, if warranted, reconsider or effects of industrial activities and helps published in the Federal Register (68 revise the negligible effect finding of to support a negligible impact finding. In addition, any future improvements FR 44020) on July 25, 2003, included a this rule. Comment: Polar bears may be more to monitoring and reporting request for public comments. The affected by an oil spill than an initial requirements may be implemented as closing date for the comment period was mortality survey may indicate. conditions to future LOAs as warranted. August 25, 2003. We received seven Response: We agree that there may be Comment: No alternatives were comments. Two commenters indicated secondary or latent effects on polar analyzed, such as issuing regulations support for the rule but did not provide bears from an oil spill. These effects are that cover a narrower geographical specific comments. One commenter additive to the potential direct effects scope (e.g., only lands falling within provided new comments but also discussed in the section on oil spills in existing leases). incorporated by reference their the proposed rule. The final rule has Response: The current geographic comments on the 2000 proposed rule been revised to reflect our analysis of scope of the regulations accurately (65 FR 16828). For those past comments, such latent effects and the finding that addresses the areas of ongoing or we refer the commenter to our previous the potential secondary or latent effects, expected Industry activities and responses (65 FR 16828). The following along with potential direct effects, will provides the framework for our issues were raised by the commenters. have a negligible impact, considering assessment of potential impacts. Specific Comments and Responses the likelihood of these effects occurring. Narrowing the scope of the regulations Comment: The proposed rule is or evaluating lesser alternatives of Comment: Some commenters stated inconsistent with the incidental take reduced scale or frequency would not their opposition to any form of provisions of the MMPA. (The allow us to adequately address potential incidental killing of wildlife, indicating commenter did not identify specific cumulative impacts. The alternatives their opinion that the incidental take inconsistencies.) considered in our environmental program was developed as a vehicle to Response: Incidental take is assessment were to issue regulations or grant permission to the oil and gas authorized under section 101(a)(5)(A) of not to issue regulations covering the full industry to kill polar bears and walrus. the MMPA. While the MMPA placed a geographic area in which similar and Response: The authorization of moratorium on the taking of any marine interrelated Industry activities occur. incidental take of marine mammals is mammal, section 101(a) of the MMPA Comment: The regulations should not provided for under section 101(a)(5)(A) identifies exceptions to the moratorium. include the State or Federal Outer of the MMPA. Take is defined as ‘‘to Section 101(a)(5)(A) of the MMPA Continental Shelf waters offshore of the harass, hunt, capture, or kill, or attempt provides for the incidental but not Arctic National Wildlife Refuge. to harass, hunt, capture, or kill any intentional take of small numbers of Response: We acknowledge that the marine mammal.’’ Intentional take is not marine mammals, provided that the State and Federal Outer Continental authorized by these regulations. total take will have a negligible impact Shelf waters offshore the Arctic Incidental take is authorized only after on the population and will not affect the National Wildlife Refuge are important the Service finds that any expected take availability of the species for movement, feeding, and denning will have no more than a negligible subsistence users. habitats to polar bears. However, these impact on the species. During the past Comment: A more comprehensive regulations do not authorize the actual nine years of incidental take regulations, analysis of incidences of harassment of Industry activities in this or other areas. there are no known instances where a polar bears is necessary prior to issuing The geographic scope of the regulations polar bear or walrus was killed by these regulations. was based on that area in which Industry activities. When polar bears do Response: Polar bear/human Industry has already been authorized to encounter Industry activities, interaction data (1994—2003) occurring conduct exploration, development, and appropriate measures are taken to during Industry activities was production activities; that area in which safeguard the lives of both humans and incorporated into the analysis of this Industry applied for MMPA coverage; bears. Section 101(5)(B) authorizes the rule. The level and effects of hazing and that area which allows us to Secretary to withdraw or suspend the during this period were not significant accurately assess Industry’s effects on authorization if these regulations are not and resulted in a negligible impact polar bears and walrus. complied with, or if the take allowed finding. The general objective of hazing Comment: The Service has conflated under the regulations is having or may polar bears is to encourage the the MMPA’s requirement that the have a more than negligible impact on movement of bears transient to coastal number of takings be small and that the the species or stock of concern. habitats back onto the pack-ice number of takings has a negligible Comment: No number or percentage environment. The type and degree of impact on a species or stock. of a population is included as an upper hazing depend on specific Response: We disagree with this limit on the number of polar bears or circumstances, and in many instances comment and believe that our analysis walrus that could be killed over a given only passive forms of hazing are has fully considered the MMPA period of time while ensuring a necessary, such as positioning of requirement that the number of takes be sustainable population. vehicles or noise to displace bears from small and that takings have a negligible Response: The assessment of effects areas occupied by people. Cracker shell impact on species or stock. Based on the does not attempt to describe the shotgun fire or deterrent rounds may be monitoring information we have allowable maximum sustainable used when concerns for human safety acquired to date, we conservatively incidental take mortality that could are more immediate. We will continue estimate that the average number of occur. We evaluated the potential effect to evaluate the data to determine if polar bears and walrus that may modify of the predicted take to determine if the trends exist regarding the location and their behavior as a result of the oil and impact of this level of take would be timing of hazing events and, if gas industry is small. In most cases, negligible. If an unanticipated mortality necessary, we will refine how hazing is takes are a behavioral change that will of polar bears occurs, we will evaluate conducted in the future. The hazing of be temporary, minor behavioral

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00062 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66757

modifications that we believe will have availability of polar bears to the village take regulations have been in place in no effect on rates of recruitment or of Nuiqsut. the Arctic oil and gas fields for the past survival. Other takes will be associated Response: We have considered this 10 years. Monitoring results indicate with deterrence or, hazing, events. We issue and find that the total taking of that there has been little to no short- believe these events will have no effect polar bears will not have an unmitigable term impact on polar bears or Pacific on rates or recruitment and survival as adverse impact on the availability of walrus. Additional information, such as well. Lethal takes are extremely rare, but this species to Nuiqsut residents for subsistence harvest levels and they may also occur (only 2 polar bear subsistence uses during the duration of observations of the frequency, timing, deaths have been attributed to oil and the regulation. We base this conclusion and magnitude of polar bear occurrence gas activities in Alaska during the past on the results of coastal aerial surveys near shore, provides evidence that these 30 years). Although the small potential conducted within the area during the populations have not been adversely for a lethal take occurring continues to past three years, upon direct affected. For the duration of this rule, exist throughout the length of this rule, observations of polar bears occurring on we anticipate that the level and effect of it is unlikely that a lethal take will have Cross Island during the village of oil and gas industry interactions with little effect on the rates of recruitment Nuiqsut’s annual fall bowhead whaling polar bears and Pacific walrus will be or survival of the population as a whole. efforts, and upon anecdotal reports of similar to interactions of past years. Takes that may have effects on Nuiqsut residents. In addition, the Our goal is to continue to collect or recruitment and survival are associated Service has not received any evidence improve on the collection of the types with oil spills. We calculated that the or reports that bears are being deflected of information that have been useful in probability of a spill that will cause or being impacted in other ways to assessing cumulative effects in the past. mortality of one or more bears is 0.4–1.3 diminish their availability for We also anticipate that additional percent. As the threshold number of subsistence use by the existing level of analysis and collection of additional bears is increased, the likelihood of that oil and gas activity. data will be necessary to improve upon event decreases; that is, the likelihood Comment: The Service should modify future longer-range impact assessment. of taking more bears becomes less and its oil spill risk assessment to properly Comment: In the final regulations, the less. The probability of a spill that will reflect the assumptions and Service should describe mitigation cause a mortality of 5 or more bears is uncertainties concerning the effects of measures that will be required for 0.3–1.1 percent; for 10 or more bears is oil spills on walrus and polar bears. industry to minimize impacts to polar 0.3–0.9 percent; and for 20 or more Response: The oil spill risk bears. bears is 0.1–0.5 percent. assessment represents the best available Response: We have revised the Comment: The Service should methodology and is a marked regulations to include those mitigation establish a mechanism to evaluate and improvement from the previous lack of measures that may be required as authorize the incidental taking of information on this topic. The Service conditions of LOAs to ensure that the marine mammals resulting from recognizes the limitations of the oil spill total taking of polar bears and walrus activities associated with, but occurring assessment model and the predictive will have a negligible impact on these outside of, the geographic location of values based on data inputs, species and will not have an the proposed regulation (e.g., ship traffic assumptions, and model construction. unmitigable adverse impact on the that passes through the Bering and This model is a stochastic model and availability of these species for Chukchi seas and supplies industry incorporates levels of variance subsistence uses during the duration of operations in the Beaufort Sea). associated with certain parameters such the regulation. Some of the conditions Response: This suggestion goes as environmental conditions and polar are standard requirements, and others beyond the scope of this rule and bear distribution probabilities. The are activity- and site-specific and may beyond the petitioner’s request. We model presents a range of values vary. The final rule has been expanded considered past oil and gas support representing the number of polar bears and also lists a map that delineates activities beyond the geographic area of that may be oiled resulting from the polar bear denning habitat and can the rule. The vast majority of the numerous model run interactions include the use of FLIR or polar bear secondary industry support activities conducted, and an associated frequency scent-trained dogs to determine the occur during the open water season of occurrence or likelihood value. We presence or absence of dens as examples associated with barge re-supply when believe that this is the most reliable of mitigation measures that have been encounters with polar bears or walrus assessment given the existing used successfully in the past on a case- would be minimal. We determined that information. We are working to improve by-case basis. the potential effect of these activities the model for future use. This will take Comment: The Service should was not significant and did not time, effort, coordination, and funds. develop and implement a monitoring contribute cumulatively to the impacts Comment: The Service should initiate program with sufficient resolution to within the geographic area requested. a complete analysis of cumulative detect changes in parameters that might We concluded that the boundaries that effects on polar bears and walrus for the be expected to occur. were requested were accurate to monitor future, longer-term regulations. Response: We find that the effects of the oil and gas activity on Response: The Service agrees with independently gathered population data polar bears and Pacific walrus occurring this comment. We are currently on the Southern Beaufort Sea within the Beaufort Sea. If concerns for accumulating information for population demonstrated that the potential takes associated with consideration in a future longer-term development, as guided under the Industry support activities beyond the rule, such as reviewing elements of previous regulations, has not affected current geographical area of the existing and future research and rates of recruitment and survival of this regulations increase in the future, we monitoring plans that will improve our polar bear population. As scientific may consider this issue elsewhere. ability to detect and measure changes in methods improve and better information Comment: Prior to finalizing the the population. becomes available they will be regulations, the Service should conduct In this final rule, the cumulative incorporated into monitoring programs a thorough analysis of possible impacts effects of the previous incidental take to help to assess potential effects to rates of oil and gas activities on the regulations are considered. Incidental of recruitment and survival and the

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00063 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66758 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

population parameters linked to Environmental Assessment, contact the employment, productivity, innovation, assessing population level impacts from individual identified in the section FOR or on the ability of United States-based oil and gas development. We also agree FURTHER INFORMATION CONTACT. enterprises to compete with foreign- that as information and technology based enterprises in domestic or export Regulatory Planning and Review improves, the monitoring program will markets. continue to evolve. With this in mind, This document has not been reviewed Regulatory Flexibility Act we convened a small workshop of by the Office of Management and technical experts during –5, Budget (OMB) under Executive Order We have also determined that this 2003, to consider research, studies, and 12866 (Regulatory Planning and rule will not have a significant monitoring that would improve our Review). This rule will not have an economic effect on a substantial number understanding of the effects of oil and effect of $100 million or more on the of small entities under the Regulatory gas activities on polar bears. The economy; will not adversely affect in a Flexibility Act (5 U.S.C. 601 et seq.). Oil product of this effort, considered as a material way the economy, productivity, companies and their contractors work in progress subject to revision and competition, jobs, the environment, conducting exploration, development, refinement, will be a proceedings of the public health or safety, or State, local, and production activities in Alaska have workshop that details the various or tribal governments or communities; been identified as the only likely information needs, studies, monitoring, will not create a serious inconsistency applicants under the regulations. and research. We consider the results of or otherwise interfere with an action Therefore, a Regulatory Flexibility workshop to be the first step in taken or planned by another agency; Analysis is not required. In addition, improving our monitoring programs. We does not alter the budgetary effects of these potential applicants have not been also acknowledge that developing a entitlements, grants, user fees, or loan identified as small businesses, and, comprehensive research and monitoring programs or the rights or obligations of therefore, a Small Entity Compliance program capable of developing their recipients; and does not raise Guide is not required. The analysis for information of sufficient resolution to novel legal or policy issues. The rule is this rule is available from the person in not likely to result in an annual effect detect changes in population rates of Alaska identified in the section FOR on the economy of $100 million or recruitment and survival is a formidable FURTHER INFORMATION CONTACT. task and a worthy goal. more. Expenses will be related to, but not necessarily limited to, the Takings Implications Effective Date development of applications for LOAs, This rule does not have takings In accordance with 5 U.S.C. 553(d)(3), monitoring, record keeping, and reporting activities conducted during implications under Executive Order we find that we have good cause to 12630 because it authorizes the make this rule effective immediately Industry oil and gas operations, development of polar bear interaction incidental, but not intentional, take of upon publication. To protect the small numbers of polar bear and walrus affected species and reduce the chances plans, and coordination with Alaska Natives to minimize effects of by oil and gas industry companies and of lethal and nonlethal effects from thereby exempts these companies from Industry, we need to implement operations on subsistence hunting. Compliance with the rule is not civil and criminal liability as long as incidental take and monitoring they operate in compliance with the programs on the North Slope of Alaska expected to result in additional costs to Industry that it has not already been terms of their LOAs. Therefore, a takings coincident with the season of greatest implications assessment is not required. probability for polar bear encounters in subjected to for the previous 6 years. the industrial area considered within Realistically, these costs are minimal in Federalism Effects this rule. The period of greatest comparison to those related to actual oil and gas exploration, development, and This rule also does not contain probability for polar bear encounters is policies with Federalism implications the fall and early winter period. The production operations. The actual costs to Industry to develop the petition for sufficient to warrant preparation of a mitigation measures required through Federalism Assessment under Executive LOAs have proven to be effective in promulgation of regulations (originally developed in 2002) and LOA requests Order 13132. In accordance with the minimizing effects of oil and gas Unfunded Mandates Reform Act (2 activities on polar bears and walrus. probably does not exceed $500,000 per year, short of the ‘‘major rule’’ threshold U.S.C. 1501, et seq.), this rule will not Furthermore, safety measures included ‘‘significantly or uniquely’’ affect small in this process minimize potential lethal that would require preparation of a regulatory impact analysis. As is governments. A Small Government encounters between polar bears and Agency Plan is not required. The personnel at industrial sites. Therefore, presently the case, profits will accrue to Industry, royalties and taxes will accrue Service has determined and certifies it is essential to implement these pursuant to the Unfunded Mandates regulations as soon as possible so that to the Government, and the rule will have little or no impact on decisions by Reform Act that this rulemaking will not polar bears and walrus may benefit from impose a cost of $100 million or more these protective measures. Industry to relinquish tracts and write off bonus payments. in any given year on local or State Required Determinations governments or private entities. This Small Business Regulatory Enforcement rule will not produce a Federal mandate NEPA Considerations Fairness Act of $100 million or greater in any year, We have prepared an Environmental We have determined that this rule is i.e., it is not a ‘‘significant regulatory Assessment (EA) in conjunction with not a major rule under 5 U.S.C. 804(2), action’’ under the Unfunded Mandates this rulemaking, and have determined the Small Business Regulatory Reform Act. that this rulemaking is not a major Enforcement Fairness Act. The rule is Civil Justice Reform Federal action significantly affecting the also not likely to result in a major quality of the human environment increase in costs or prices for The Departmental Solicitor’s Office within the meaning of section 102(2)(C) consumers, individual industries, or has determined that these regulations do of the National Environmental Policy government agencies or have significant not unduly burden the judicial system Act (NEPA) of 1969. For a copy of the adverse effects on competition, and meet the applicable standards

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00064 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66759

provided in sections 3(a) and 3(b)(2) of constitute a significant energy action. 18.126 What does a Letter of Authorization Executive Order 12988. No Statement of Energy Effects is allow? required. 18.127 What activities are prohibited? Paperwork Reduction Act 18.128 What are the mitigation, monitoring, The information collection List of Subjects in 50 CFR Part 18 and reporting requirements? requirements included in this rule are Administrative practice and 18.129 What are the information collection already approved by the Office of procedure, Alaska, Imports, Indians, requirements? Management and Budget (OMB) under Marine mammals, Oil and gas the Paperwork Reduction Act of 1995 exploration, Reporting and record Subpart J—Taking of Marine Mammals (44 U.S.C. 3501 et seq.). The OMB keeping requirements, Transportation. Incidental to Oil and Gas Exploration, control number assigned to these Development, and Production Final Regulation Promulgation information collection requirements is Activities in the Beaufort Sea and 1018–0070, which expires on September ■ For the reasons set forth in the Adjacent Northern Coast of Alaska 30, 2004. This control number covers preamble, the Service amends part 18, the information collection requirements subchapter B, of chapter 1, title 50, of the § 18.121 What specified activities does in 50 CFR 18, subpart J, which contains Code of Federal Regulations as set forth this subpart cover? information collection, record keeping, below. Regulations in this subpart apply to and reporting requirements associated the incidental, but not intentional, take PART 18—MARINE MAMMALS with the development and issuance of of small numbers of polar bear and specific regulations and LOAs. ■ 1. The authority citation of 50 CFR part Pacific walrus by you (U.S. citizens as Energy Effects 18 continues to read as follows: defined in § 18.27 (c)) while engaged in oil and gas exploration, development, Executive Order 13211 requires Authority: 16 U.S.C. 1361 et seq. and production activities in the Beaufort agencies to prepare Statements of ■ 2. Amend part 18 by adding a new Sea and adjacent northern coast of Energy Effects when undertaking certain subpart J to read as follows: actions. This rule provides exceptions Alaska. from the taking prohibitions of the Subpart J—Taking of Marine Mammals § 18.122 In what specified geographic MMPA for entities engaged in the Incidental to Oil and Gas Exploration, region does this subpart apply? exploration, development, and Development, and Production This subpart applies to the specified production of oil and gas in the Beaufort Activities in the Beaufort Sea and geographic region defined by a north- Sea and adjacent coastal areas of Adjacent Northern Coast of Alaska northern Alaska. By providing certainty south line at Barrow, Alaska, and includes all Alaska coastal areas, State regarding compliance with the MMPA, Sec. this rule will have a positive effect on 18.121 What specified activities does this waters, and Outer Continental Shelf Industry and its activities. Although the subpart cover? waters east of that line to the Canadian rule requires Industry to take a number 18.122 In what specified geographic region border and an area 25 miles inland from of actions, these actions have been does this subpart apply? Barrow on the west to the Canning River undertaken by Industry for many years 18.123 When is this subpart effective? on the east. The Arctic National Wildlife 18.124 How do I obtain a Letter of Refuge is not included in the area as part of similar past regulations. Authorization? Therefore, this rule is not expected to 18.125 What criteria does the Service use to covered by this subpart. Figure 1 shows significantly affect energy supplies, evaluate Letter of Authorization the area where this subpart applies. distribution, or use and does not requests? BILLING CODE 4310–55–P

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00065 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66760 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

BILLING CODE 4310–55–C rule, you must apply for a Letter of Your monitoring program must § 18.123 When is this subpart effective? Authorization for each exploration document the effects on these marine activity or a Letter of Authorization for mammals and estimate the actual level Regulations in this subpart are activities in each development and and type of take. The monitoring effective from November 28, 2003, production area. You must submit the requirements will vary depending on through March 28, 2005, for year-round application for authorization to our oil and gas exploration, development, the activity, the location, and the time Alaska Regional Director (see 50 CFR of year. and production activities. 2.2 for address) at least 90 days prior to the start of the activity. (3) A site-specific polar bear § 18.124 How do I obtain a Letter of awareness and interaction plan. Authorization? (c) Your application for a Letter of Authorization must include the (4) A Plan of Cooperation to mitigate (a) You must be a U.S. citizen as following information: potential conflicts between the defined in § 18.27(c) of this part. (1) A description of the activity, the proposed activity and subsistence (b) If you are conducting an oil and dates and duration of the activity, the hunting. This Plan of Cooperation must gas exploration, development, or specific location, and the estimated area identify measures to minimize adverse production activity that may cause the affected by that activity. effects on the availability of polar bear taking of polar bear or Pacific walrus in (2) A site-specific plan to monitor the and Pacific walrus for subsistence uses the specified geographic region effects of the activity on the behavior of described in § 18.122 and you want polar bear and Pacific walrus that may if the activity takes place in or near a incidental take authorization under this be present during the ongoing activity. traditional subsistence hunting area.

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00066 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 ER28NO03.005 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66761

§ 18.125 What criteria does the Service (c) Each Letter of Authorization will available to Industry to ensure that the use to evaluate Letter of Authorization identify conditions or methods that are location of potential polar bear dens is requests? specific to the activity and location. considered when conducting activities (a) We will evaluate each request for in the coastal areas of the Beaufort Sea. § 18.127 What activities are prohibited? a Letter of Authorization based on the (i) For exploratory activities, holders specific activity and the specific (a) Intentional take of polar bear or of a Letter of Authorization must submit geographic location. We will determine Pacific walrus. a report to our Alaska Regional Director (b) Any take that fails to comply with whether the level of activity identified within 90 days after completion of the terms and conditions of these in the request exceeds that considered activities. For development and specific regulations or of your Letter of by us in making a finding of negligible production activities, holders of a Letter Authorization. impact on the species and a finding of of Authorization must submit a report to no unmitigable adverse impact on the § 18.128 What are the mitigation, our Alaska Regional Director by January availability of the species for take for monitoring and reporting requirements? 15 for the preceding year’s activities. subsistence uses. If the level of activity (a) We require holders of Letters of Reports must include, at a minimum, is greater, we will reevaluate our Authorization to cooperate with us and the following information: findings to determine if those findings other designated Federal, State, and (1) Dates and times of activity; continue to be appropriate based on the local agencies to monitor the impacts of (2) Dates and locations of polar bear greater level of activity that you have oil and gas exploration, development, or Pacific walrus activity as related to requested. Depending on the results of and production activities on polar bear the monitoring activity; and the evaluation, we may grant the and Pacific walrus. (3) Results of the monitoring authorization as is, add further (b) Holders of Letters of Authorization activities, including an estimated level conditions, or deny the authorization. must designate a qualified individual or of take. (b) In accordance with § 18.27(f)(5) of individuals to observe, record, and this part, we will make decisions report on the effects of their activities on § 18.129 What are the information concerning withdrawals of Letters of polar bear and Pacific walrus. collection requirements? Authorization, either on an individual (c) Holders of Letters of Authorization (a) The collection of information or class basis, only after notice and are required to have a polar bear contained in this subpart has been opportunity for public comment. interaction plan on file with the Service, approved by the Office of Management (c) The requirement for notice and and polar bear awareness training will and Budget under the Paperwork public comment in paragraph (b) of this also be required of certain personnel. Reduction Act (44 U.S.C. 3501 et seq.) section will not apply should we (d) Under a Plan of Cooperation and assigned clearance number 1018– determine that an emergency exists that Industry must contact affected 0070. We need to collect the poses a significant risk to the well-being subsistence communities to discuss information in order to assess the of the species or stock of polar bear or potential conflicts caused by location, proposed activity and estimate the Pacific walrus. timing, and methods of proposed impacts of potential takings by all operations. Industry must make persons conducting the activity. We will § 18.126 What does a Letter of reasonable efforts to ensure that Authorization allow? use the information to evaluate the activities do not interfere with application and determine whether to (a) Your Letter of Authorization may subsistence hunting and that adverse issue specific Letters of Authorization. allow the incidental, but not intentional, effects on the availability of polar bear (b) For the duration of this rule, when take of polar bear and Pacific walrus or Pacific walrus are minimized. you conduct operations under this rule, when you are carrying out one or more (e) We may place an observer on the we estimate an 8-hour burden per Letter of the following activities: site of the activity or on board drill of Authorization, a 4-hour burden for (1) Conducting geological and ships, drill rigs, aircraft, icebreakers, or monitoring, and an 8-hour burden per geophysical surveys and associated other support vessels or vehicles to monitoring report. You must respond to activities; monitor the impacts of your activity on this information collection request to (2) Drilling exploratory wells and polar bear and Pacific walrus. obtain a benefit pursuant to section associated activities; (f) If known occupied dens are located 101(a)(5) of the Marine Mammal (3) Developing oil fields and within an operator’s area of activity, we Protection Act (MMPA). You should associated activities; will require a 1-mile exclusion buffer direct comments regarding the burden (4) Drilling production wells and around the den to limit disturbance or estimate or any other aspect of this performing production support require that the operator conduct requirement to the Information operations; activities after the female bears emerge Collection Clearance Officer, U.S. Fish (5) Conducting environmental from their dens. We will review these and Wildlife Service, Department of the monitoring programs associated with instances for extenuating circumstances Interior, Mail Stop 222 ARLSQ, 1849 C exploration, development, and on a case by case basis. Street, NW., Washington, DC 20240, and production activities to determine (g) Industry may also be required to the Office of Management and Budget, specific impacts of each activity. use Forward Looking Infrared (FLIR) Paperwork Reduction Project (1018– (b) You must use methods and imagery and/or scent-trained dogs to 0070), Washington, DC 20503. conduct activities identified in your determine presence or absence of polar Letter of Authorization in a manner that bear dens in areas of activity. Dated: November 20, 2003. minimizes to the greatest extent (h) A map of potential coastal polar Craig Manson, practicable adverse impacts on polar bear denning habitat can be found at: Assistant Secretary for Fish and Wildlife and bear and Pacific walrus, their habitat, http://www.absc.usgs.gov/research/ Parks. and on the availability of these marine sis_summaries/polar_bears_sis/ [FR Doc. 03–29751 Filed 11–26–03; 8:45 am] mammals for subsistence uses. mapping_dens.htm. This map is BILLING CODE 4310–55–P

VerDate jul<14>2003 13:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00067 Fmt 4700 Sfmt 4700 E:\FR\FM\28NOR1.SGM 28NOR1 66762

Proposed Rules Federal Register Vol. 68, No. 229

Friday, November 28, 2003

This section of the FEDERAL REGISTER subject line and need not be submitted Commenters wishing the FAA to contains notices to the public of the proposed in triplicate. Comments sent via the acknowledge receipt of their comments issuance of rules and regulations. The Internet as attached electronic files must submitted in response to this action purpose of these notices is to give interested be formatted in Microsoft Word 97 or must submit a self-addressed, stamped persons an opportunity to participate in the 2000 or ASCII text. postcard on which the following rule making prior to the adoption of the final rules. The service information referenced in statement is made: ‘‘Comments to the proposed rule may be obtained from Docket Number 2001–NM–380–AD.’’ Airbus, 1 Rond Point Maurice Bellonte, The postcard will be date stamped and DEPARTMENT OF TRANSPORTATION 31707 Blagnac Cedex, France. This returned to the commenter. information may be examined at the Availability of NPRMs Federal Aviation Administration FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Any person may obtain a copy of this 14 CFR Part 39 Washington. NPRM by submitting a request to the FAA, Transport Airplane Directorate, [Docket No. 2001–NM–380–AD] FOR FURTHER INFORMATION CONTACT: Dan ANM–114, Attention: Rules Docket No. RIN 2120–AA64 Rodina, Aerospace Engineer, 2001–NM–380–AD, 1601 Lind Avenue, International Branch, ANM–116, FAA, SW., Renton, Washington 98055–4056. Airworthiness Directives; Airbus Model Transport Airplane Directorate, 1601 A330–301, –321, –322, –341, and –342 Lind Avenue, SW., Renton, Washington Discussion Series Airplanes; and Model A340 98055–4056; telephone (425) 227–2125; The Direction Ge´ne´rale de l’Aviation Series Airplanes fax (425) 227–1149. Civile (DGAC), which is the SUPPLEMENTARY INFORMATION: airworthiness authority for France, AGENCY: Federal Aviation notified the FAA that an unsafe Administration, DOT. Comments Invited condition may exist on certain Airbus ACTION: Notice of proposed rulemaking Interested persons are invited to Model A330–301, –321, –322, –341, and (NPRM). participate in the making of the –342 series airplanes; and certain Model A340 series airplanes. The DGAC SUMMARY: This document proposes the proposed rule by submitting such adoption of a new airworthiness written data, views, or arguments as advises that major wing fatigue tests directive (AD) that is applicable to they may desire. Communications shall revealed cracks initiating from the wire certain Airbus Model A330–301, –321, identify the Rules Docket number and harness slot in the inner rear spars of –322, –341, and –342 series airplanes; be submitted in triplicate to the address the wings between ribs 4 and 5. The and certain Model A340 series specified above. All communications cracking can occur on airplanes that airplanes. This proposal would require received on or before the closing date have not been modified to reinforce the inspecting for and repairing cracks of for comments, specified above, will be wire harness slot and the adjacent holes. the wire harness slots in the inner rear considered before taking action on the The results indicate that the fatigue life for the wire harness slot is less than the spars of the wings between ribs 4 and proposed rule. The proposals contained design requirement. Cracks in the wire 5, and cold-expanding crack-free wire in this action may be changed in light harness slot, if not corrected, could harness slots and bolt holes. This action of the comments received. result in reduced structural integrity of is necessary to prevent cracking of the Submit comments using the following the wing. wire harness slot, which could result in format: reduced structural integrity of the wing. • Organize comments issue-by-issue. Explanation of Relevant Service This action is intended to address the For example, discuss a request to Information identified unsafe condition. change the compliance time and a Airbus has issued Service Bulletins DATES: Comments must be received by request to change the service bulletin A330–57–3055 and A340–57–4062, both December 29, 2003. reference as two separate issues. Revision 01, dated , 2002. The ADDRESSES: Submit comments in • For each issue, state what specific service bulletins describe procedures for triplicate to the Federal Aviation change to the proposed AD is being a modification of the inner rear spars of Administration (FAA), Transport requested. the wings. The modification involves an Airplane Directorate, ANM–114, • Include justification (e.g., reasons or eddy current surface crack inspection of Attention: Rules Docket No. 2001–NM– data) for each request. the wire harness slots in the rear spars 380–AD, 1601 Lind Avenue, SW., Comments are specifically invited on of the wings between ribs 4 and 5, a Renton, Washington 98055–4056. the overall regulatory, economic, high-frequency eddy current rototest Comments may be inspected at this environmental, and energy aspects of inspection for cracks in the area around location between 9 a.m. and 3 p.m., the proposed rule. All comments the bolt holes that attach the support Monday through Friday, except Federal submitted will be available, both before plates of the electrical connectors, and holidays. Comments may be submitted and after the closing date for comments, cold-expansion of the wire harness slots via fax to (425) 227–1232. Comments in the Rules Docket for examination by and the bolt holes. The service bulletins may also be sent via the Internet using interested persons. A report recommend contacting Airbus if cracks the following address: 9–anm- summarizing each FAA-public contact are found. Accomplishment of the [email protected]. Comments sent concerned with the substance of this actions specified in the service bulletins via fax or the Internet must contain proposal will be filed in the Rules is intended to adequately address the ‘‘Docket No. 2001–NM–380–AD’’ in the Docket. identified unsafe condition. The DGAC

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66763

classified these service bulletins as repair that would be required to address it is determined that this proposal mandatory and issued French the unsafe condition, and consistent would not have federalism implications airworthiness directives 2001–578(B) with existing bilateral airworthiness under Executive Order 13132. and 2001–579(B), both dated November agreements, we have determined that, For the reasons discussed above, I 28, 2001, to ensure the continued for this proposed AD, a repair approved certify that this proposed regulation (1) airworthiness of these airplanes in by either the FAA or the DGAC would is not a ‘‘significant regulatory action’’ France. be acceptable for compliance with this under Executive Order 12866; (2) is not proposed AD. a ‘‘significant rule’’ under the DOT FAA’s Conclusions Regulatory Policies and Procedures (44 Cost Impact These airplane models are FR 11034, February 26, 1979); and (3) if manufactured in France and are type We estimate that this proposed AD promulgated, will not have a significant certificated for operation in the United would affect 1 Model A330 series economic impact, positive or negative, States under the provisions of section airplane of U.S. registry. Currently, on a substantial number of small entities 21.29 of the Federal Aviation there are no affected Model A330–341 under the criteria of the Regulatory Regulations (14 CFR 21.29) and the or A340 series airplanes on the U.S. Flexibility Act. A copy of the draft applicable bilateral airworthiness Register. The proposed actions would regulatory evaluation prepared for this agreement. Pursuant to this bilateral take about 30 work hours per airplane, action is contained in the Rules Docket. airworthiness agreement, the DGAC has at an average labor rate of $65 per work A copy of it may be obtained by kept the FAA informed of the situation hour. Required parts would cost about contacting the Rules Docket at the described above. The FAA has $1,075 per airplane. Based on these location provided under the caption examined the findings of the DGAC, figures, the cost impact of this proposed ADDRESSES. reviewed all available information, and action is estimated to be $3,025 per determined that AD action is necessary airplane. List of Subjects in 14 CFR Part 39 for products of this type design that are The cost impact figure discussed Air transportation, Aircraft, Aviation certificated for operation in the United above is based on assumptions that no safety, Safety. States. operator has yet accomplished any of the proposed requirements of this AD The Proposed Amendment Explanation of Requirements of action, and that no operator would Accordingly, pursuant to the Proposed Rule accomplish those actions in the future if authority delegated to me by the Since an unsafe condition has been this AD were not adopted. The cost Administrator, the Federal Aviation identified that is likely to exist or impact figures discussed in AD Administration proposes to amend part develop on other airplanes of the same rulemaking actions represent only the 39 of the Federal Aviation Regulations type design registered in the United time necessary to perform the specific (14 CFR part 39) as follows: States, the proposed AD would require actions actually required by the AD. accomplishment of the actions specified These figures typically do not include PART 39—AIRWORTHINESS in the service bulletins described incidental costs, such as the time DIRECTIVES previously, except as discussed below. required to gain access and close up, 1. The authority citation for part 39 planning time, or time necessitated by Difference Between Proposed AD and continues to read as follows: other administrative actions. Service Bulletins Authority: 49 U.S.C. 106(g), 40113, 44701. Although the service bulletins specify Regulatory Impact § 39.13 [Amended] that operators may contact the The regulations proposed herein manufacturer for disposition of certain would not have a substantial direct 2. Section 39.13 is amended by repair conditions, this proposal would effect on the States, on the relationship adding the following new airworthiness require operators to repair those between the national Government and directive: conditions per a method approved by the States, or on the distribution of Airbus: Docket 2001–NM–380–AD. either the FAA or the DGAC (or its power and responsibilities among the Applicability: The airplanes listed in Table delegated agent). In light of the type of various levels of government. Therefore, 1 of this AD, certificated in any category:

TABLE 1.—APPLICABILITY

Except those modified by Model— Airbus Modi- Or Airbus Service Bulletin— fication—

A330–301, ¥321, ¥322, ¥341, and ¥342 series airplanes .. 43503 A330–57–3055, dated November 28, 2001, or Revision 01, dated May 2, 2002. A340 series airplanes ...... 43692 A340–57–4062, dated November 28, 2001, or Revision 01, dated May 2, 2002.

Compliance: Required as indicated, unless Modification involves an eddy current surface crack accomplished previously. (a) At the time specified in paragraph inspection of the wire harness slots in the To prevent cracking of the wire harness (a)(1), (a)(2), or (a)(3) of this AD: Modify the rear spars of the wings between ribs 4 and slot on the inner rear spar of the wing, which inner rear spars of the wings in accordance 5, a high-frequency eddy current rototest could result in reduced structural integrity of with the Accomplishment Instructions of inspection for cracks in the area around the the wing, accomplish the following: Airbus Service Bulletin A330–57–3055 or bolt holes that attach the support plates of A340–57–4062, both Revision 01, both dated the electrical connectors, and cold-expansion May 2, 2002, as applicable. The modification of the wire harness slots and the bolt holes.

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66764 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

(1) For Model A330 series airplanes: include a moisture seal and ventilated Submit comments using the following Inspect before the accumulation of 16,500 cover. This action is necessary to format: total flight cycles or 51,400 total flight hours, prevent water from being trapped inside • Organize comments issue-by-issue. whichever occurs first. the joystick covers, which could result For example, discuss a request to (2) For Model A340 series airplanes, pre- Modification 41300: Inspect before the in uncommanded movements of the change the compliance time and a accumulation of 14,500 total flight cycles or power drive unit during ground request to change the service bulletin 75,400 total flight hours, whichever occurs handling of cargo and consequent reference as two separate issues. first. possible injury to ground personnel. • For each issue, state what specific (3) For Model A340 series airplanes, post- This action is intended to address the change to the proposed AD is being Modification 41300: Inspect before the identified unsafe condition. requested. accumulation of 13,400 total flight cycles or • Include justification (e.g., reasons or DATES: Comments must be received by 70,000 total flight hours, whichever occurs data) for each request. first. January 12, 2004. Comments are specifically invited on (b) A modification done before the effective ADDRESSES: Submit comments in the overall regulatory, economic, date of this AD in accordance with Airbus triplicate to the Federal Aviation environmental, and energy aspects of Service Bulletin A330–57–3055 or A340–57– Administration (FAA), Transport 4062, both dated November 28, 2001, is the proposed rule. All comments acceptable for compliance with the Airplane Directorate, ANM–114, submitted will be available, both before applicable requirements of this AD. Attention: Rules Docket No. 2002–NM– and after the closing date for comments, 14–AD, 1601 Lind Avenue, SW., in the Rules Docket for examination by Repair Renton, Washington 98055–4056. interested persons. A report (c) If any crack is found during an Comments may be inspected at this summarizing each FAA-public contact inspection required by paragraph (a) of this location between 9 a.m. and 3 p.m., concerned with the substance of this AD: Before further flight, repair in Monday through Friday, except Federal proposal will be filed in the Rules accordance with a method approved by holidays. Comments may be submitted either the Manager, International Branch, Docket. ANM–116, Transport Airplane Directorate, via fax to (425) 227–1232. Comments Commenters wishing the FAA to FAA; or the Direction Ge´ne´rale de l’Aviation may also be sent via the Internet using acknowledge receipt of their comments Civile (or its delegated agent). the following address: 9-anm- submitted in response to this action [email protected]. Comments sent must submit a self-addressed, stamped Alternative Methods of Compliance via fax or the Internet must contain postcard on which the following (d) In accordance with 14 CFR 39.19, the ‘‘Docket No. 2002–NM–14–AD’’ in the statement is made: ‘‘Comments to Manager, International Branch, ANM–116, is subject line and need not be submitted Docket Number 2002–NM–14–AD.’’ The authorized to approve alternative methods of in triplicate. Comments sent via the compliance for this AD. postcard will be date stamped and Internet as attached electronic files must returned to the commenter. Note 1: The subject of this AD is addressed be formatted in Microsoft Word 97 or in French airworthiness directives 2001– Availability of NPRMs 578(B) and 2001–579(B), both dated 2000 or ASCII text. November 28, 2001. The service information referenced in Any person may obtain a copy of this the proposed rule may be obtained from NPRM by submitting a request to the Issued in Renton, Washington, on Boeing Commercial Airplane Group, FAA, Transport Airplane Directorate, November 21, 2003. P.O. Box 3707, Seattle, Washington ANM–114, Attention: Rules Docket No. Vi L. Lipski, 98124–2207. This information may be 2002–NM–14–AD, 1601 Lind Avenue, Manager, Transport Airplane Directorate, examined at the FAA, Transport SW., Renton, Washington 98055–4056. Aircraft Certification Service. Airplane Directorate, 1601 Lind Discussion [FR Doc. 03–29696 Filed 11–26–03; 8:45 am] Avenue, SW., Renton, Washington. The FAA has received reports of BILLING CODE 4910–13–P FOR FURTHER INFORMATION CONTACT: uncommanded movements of the power Clint Jones, Aerospace Engineer, Cabin drive unit (PDU) after the joystick was DEPARTMENT OF TRANSPORTATION Safety and Environmental Systems returned to neutral position during Branch, ANM–150S, FAA, Seattle cargo bay operations on certain Boeing Federal Aviation Administration Aircraft Certification Office, 1601 Lind Model 777 series airplanes. Avenue, SW., Renton, Washington Investigation revealed that water 14 CFR Part 39 98055–4056; telephone (425) 917–6471; trapped inside the joystick cover could fax (425) 917–6590. [Docket No. 2002–NM–14–AD] lead to circuit board corrosion and SUPPLEMENTARY INFORMATION: leakage currents. This condition, if not RIN 2120–AA64 Comments Invited corrected, could result in uncommanded movements of the PDU Airworthiness Directives; Boeing Interested persons are invited to during ground handling of cargo and Model 777 Series Airplanes participate in the making of the consequent possible injury to ground AGENCY: Federal Aviation proposed rule by submitting such personnel. Administration, DOT. written data, views, or arguments as they may desire. Communications shall Explanation of Relevant Service ACTION: Notice of proposed rulemaking Information (NPRM). identify the Rules Docket number and be submitted in triplicate to the address The FAA has reviewed and approved SUMMARY: This document proposes the specified above. All communications Boeing Service Bulletin 777–25–0191, adoption of a new airworthiness received on or before the closing date dated , 2001, which directive (AD) that is applicable to for comments, specified above, will be describes procedures for replacement of certain Boeing Model 777 series considered before taking action on the the cargo control joysticks with new airplanes. This proposal would require proposed rule. The proposals contained joysticks that include a moisture seal replacement of the cargo control in this action may be changed in light and ventilated cover. Accomplishment joysticks with new joysticks that of the comments received. of the actions specified in the service

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66765

bulletin is intended to adequately required to gain access and close up, 0191, dated September 13, 2002, certificated address the identified unsafe condition. planning time, or time necessitated by in any category. other administrative actions. The Compliance: Required as indicated, unless Explanation of Requirements of manufacturer may cover the cost of accomplished previously. Proposed Rule To prevent uncommanded movements of replacement parts associated with this the power drive unit during ground handling Since an unsafe condition has been proposed AD, subject to warranty identified that is likely to exist or of cargo and consequent possible injury to conditions. Manufacturer warranty ground personnel, accomplish the following: develop on other products of this same remedies may also be available for labor type design, the proposed AD would costs associated with this proposed AD. Replacement require accomplishment of the actions As a result, the costs attributable to the (a) Within 18 months after the effective specified in the service bulletin proposed AD may be less than stated date of this AD, replace the cargo control described previously, except as above. joysticks with new joysticks, per the discussed below. Accomplishment Instructions of Boeing Regulatory Impact Service Bulletin 777–25–0191, dated Differences Between Proposed Rule and September 13, 2002. Service Bulletin The regulations proposed herein would not have a substantial direct Parts Installation Operators should note that, although effect on the States, on the relationship (b) As of the effective date of this AD, no the service bulletin recommends between the national Government and person shall install a cargo control joystick, accomplishing the replacement at the the States, or on the distribution of part number S283W602–1 or S283W602–2, next normally scheduled maintenance power and responsibilities among the on any airplane. period, the FAA has determined that various levels of government. Therefore, Alternative Methods of Compliance such an imprecise compliance time it is determined that this proposal (c) In accordance with 14 CFR 39.19, the would not address the identified unsafe would not have federalism implications condition in a timely manner. In Manager, Seattle Aircraft Certification Office, under Executive Order 13132. FAA, is authorized to approve alternative developing an appropriate compliance For the reasons discussed above, I methods of compliance for this AD. time for this proposed AD, the FAA certify that this proposed regulation (1) Issued in Renton, Washington, on considered not only the manufacturer’s is not a ‘‘significant regulatory action’’ recommendation, but the degree of November 21, 2003. under Executive Order 12866; (2) is not Vi L. Lipski, urgency associated with addressing the a ‘‘significant rule’’ under the DOT subject unsafe condition, the average Manager, Transport Airplane Directorate, Regulatory Policies and Procedures (44 Aircraft Certification Service. utilization of the affected fleet, and the FR 11034, February 26, 1979); and (3) if [FR Doc. 03–29697 Filed 11–26–03; 8:45 am] time necessary to perform the promulgated, will not have a significant inspection (three hours). In light of all economic impact, positive or negative, BILLING CODE 4910–13–P of these factors, the FAA finds an 18- on a substantial number of small entities month compliance time for completing under the criteria of the Regulatory DEPARTMENT OF TRANSPORTATION the required actions to be warranted, in Flexibility Act. A copy of the draft that it represents an appropriate interval regulatory evaluation prepared for this Federal Aviation Administration of time allowable for affected airplanes action is contained in the Rules Docket. to continue to operate without A copy of it may be obtained by 14 CFR Part 39 compromising safety. contacting the Rules Docket at the [Docket No. 2003–NM–154–AD] Cost Impact location provided under the caption ADDRESSES. There are approximately 360 RIN 2120–AA64 airplanes of the affected design in the List of Subjects in 14 CFR Part 39 Airworthiness Directives; Bombardier worldwide fleet. The FAA estimates that Air transportation, Aircraft, Aviation Model DHC–8–102, –103, –106, –201, 124 airplanes of U.S. registry would be safety, Safety. –202, –301, –311, and –315 Series affected by this proposed AD, that it Airplanes would take approximately 3 work hours The Proposed Amendment per airplane to accomplish the proposed Accordingly, pursuant to the AGENCY: Federal Aviation replacement, and that the average labor authority delegated to me by the Administration, DOT. rate is $65 per work hour. Required Administrator, the Federal Aviation ACTION: Notice of proposed rulemaking parts would cost approximately $2,200 Administration proposes to amend part (NPRM). per airplane. Based on these figures, the 39 of the Federal Aviation Regulations cost impact of the proposed AD on U.S. (14 CFR part 39) as follows: SUMMARY: This document proposes the operators is estimated to be $296,980, or adoption of a new airworthiness $2,395 per airplane. PART 39—AIRWORTHINESS directive (AD) that is applicable to The cost impact figure discussed DIRECTIVES certain Bombardier Model DHC–8–102, above is based on assumptions that no –103, –106, –201, –202, –301, –311, and operator has yet accomplished any of 1. The authority citation for part 39 –315 series airplanes. This proposal the proposed requirements of this AD continues to read as follows: would require repetitive inspections for action, and that no operator would Authority: 49 U.S.C. 106(g), 40113, 44701. discrepancies of certain rear spar fittings accomplish those actions in the future if between the flex shaft of the flap § 39.13 [Amended] this proposed AD were not adopted. The secondary drive and the wing-to- cost impact figures discussed in AD 2. Section 39.13 is amended by fuselage structure, and corrective action rulemaking actions represent only the adding the following new airworthiness if necessary. This proposal also provides time necessary to perform the specific directive: for an optional modification of the flex actions actually required by the AD. Boeing: Docket 2002–NM–14–AD. shaft installation, which would These figures typically do not include Applicability: Model 777 series airplanes, terminate the repetitive inspections. incidental costs, such as the time as listed in Boeing Service Bulletin 777–25– This action is necessary to find and fix

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66766 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

damage and subsequent failure of the • Organize comments issue-by-issue. procedures for repetitive inspections for rear spar fittings, which could result in For example, discuss a request to discrepancies (chafing, wear damage, loss of the wing. This action is intended change the compliance time and a cracking) of certain rear spar fittings to address the identified unsafe request to change the service bulletin between the flex shaft of the flap condition. reference as two separate issues. secondary drive and the wing-to- • For each issue, state what specific fuselage structure, and corrective action DATES: Comments must be received by change to the proposed AD is being if necessary. The service bulletin also December 29, 2003. requested. provides procedures for an optional ADDRESSES: Submit comments in • Include justification (e.g., reasons or modification of the flex shaft, which triplicate to the Federal Aviation data) for each request. would eliminate the need for the Administration (FAA), Transport • Comments are specifically invited repetitive inspections. The inspections Airplane Directorate, ANM–114, on the overall regulatory, economic, and corrective action are as follows: Attention: Rules Docket No. 2003–NM– environmental, and energy aspects of • A visual inspection to determine 154–AD, 1601 Lind Avenue, SW., the proposed rule. All comments the wear damage of each rear spar Renton, Washington 98055–4056. submitted will be available, both before fitting, which includes the following Comments may be inspected at this and after the closing date for comments, actions: location between 9 a.m. and 3 p.m., in the Rules Docket for examination by If wear damage is found, measure the Monday through Friday, except Federal interested persons. A report depth of the wear; and if wear depth is holidays. Comments may be submitted summarizing each FAA-public contact less than the limits specified in Table 1 via fax to (425) 227–1232. Comments concerned with the substance of this of the service bulletin, continued may also be sent via the Internet using proposal will be filed in the Rules operation is allowed for 4,000 flight the following address: 9-anm- Docket. cycles without blending out the wear; [email protected]. Comments sent Commenters wishing the FAA to when 4,000 flight cycles have been via fax or the Internet must contain acknowledge receipt of their comments accumulated, the wear damage must be ‘‘Docket No. 2003–NM–154–AD’’ in the submitted in response to this action blended out and must be within the subject line and need not be submitted must submit a self-addressed, stamped limits specified in Table 3 of the service in triplicate. Comments sent via the postcard on which the following bulletin. After blending the fitting must Internet as attached electronic files must statement is made: ‘‘Comments to be re-inspected (high frequency eddy be formatted in Microsoft Word 97 or Docket Number 2003–NM–154–AD.’’ current (HFEC) inspection) for any 2000 or ASCII text. The postcard will be date stamped and remaining discrepancies (wear, The service information referenced in returned to the commenter. cracking). Discrepancies must be the proposed rule may be obtained from repaired before further flight. If no Availability of NPRMs Bombardier, Inc., Bombardier Regional discrepancies are found the inspection Aircraft Division, 123 Garratt Boulevard, Any person may obtain a copy of this is to be repeated at intervals not to Downsview, Ontario M3K 1Y5, Canada. NPRM by submitting a request to the exceed 12 months. This information may be examined at FAA, Transport Airplane Directorate, If the wear depth is outside the limits the FAA, Transport Airplane ANM–114, Attention: Rules Docket No. specified in Table 1 of the service Directorate, 1601 Lind Avenue, SW., 2003–NM–154–AD, 1601 Lind Avenue, bulletin, but is less than the limits Renton, Washington; or at the FAA, SW., Renton, Washington 98055–4056. specified in Table 2 of the service bulletin, temporary operation is allowed New York Aircraft Certification Office, Discussion 10 Fifth Street, Third Floor, Valley for 400 flight cycles without blending Stream, New York. Transport Canada Civil Aviation out the wear; when 400 flight cycles (TCCA), which is the airworthiness have been accumulated, the wear must FOR FURTHER INFORMATION CONTACT: Jon authority for Canada, notified the FAA be blended out and within the limits Hjelm, Aerospace Engineer, Airframe that an unsafe condition may exist on specified in Table 3. The inspection is and Propulsion Branch, ANE–171, FAA, certain Bombardier Model DHC–8 series to be repeated at intervals not to exceed New York Aircraft Certification Office, airplanes. TCCA has informed the FAA 12 months. 10 Fifth Street, Third Floor, Valley that discrepancies (chafing, wear If the wear depth is greater than the Stream, New York 11581; telephone damage, cracking) have been found on limits specified in Table 2, or after (516) 256–7523; fax (516) 568–2716. the rear spar fittings (part numbers (P/ blending is greater than the limits SUPPLEMENTARY INFORMATION: N) 85320053, 85322060, and 85334180), specified in Table 3, or cracking is Comments Invited located between the flex shaft of the flap found after temporary operation, the secondary drive and the wing-to- fitting must be replaced before further Interested persons are invited to fuselage structure. These discrepancies flight. participate in the making of the are due to inadequate clearance between • A HFEC inspection for cracking of proposed rule by submitting such the fittings and the flex shaft of the flap damaged areas after continued operation written data, views, or arguments as secondary drive mechanism, caused by and after blending out wear damage. If they may desire. Communications shall vibration of the flex drive during flap no cracking is found and the blended identify the Rules Docket number and extension/retraction. Such wear is within the limits specified in be submitted in triplicate to the address discrepancies could affect the fatigue Table 3, permanent continued operation specified above. All communications life of the fittings, which could result in is allowed. If cracking is found or received on or before the closing date failure of the fittings and consequent blended wear exceeds the limits for comments, specified above, will be loss of the wing. specified in Table 3, the fitting must be considered before taking action on the replaced before further flight. proposed rule. The proposals contained Explanation of Relevant Service • Replacement of the rear spar fittings in this action may be changed in light Information includes removal of the existing fittings, of the comments received. Bombardier has issued Service removal of old sealant, inspection of Submit comments using the following Bulletin 8–27–83, Revision ‘A’, dated each hole through the rear spar and format: , 2002, which describes fuselage for damage, repair of any

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66767

damage before further flight, and case of this AD, long-term continued Regulatory Impact application of new sealant, installation operational safety is adequately assured The regulations proposed herein of new fittings, and application of anti- by doing the repetitive inspections to would not have a substantial direct corrosive compound. detect discrepancies before they • effect on the States, on the relationship The optional modification of the represent a hazard to the airplane, and between the national Government and flex shaft includes installation of new by doing repairs within the specified the States, or on the distribution of brackets on the rear spar, rework of the time limits. power and responsibilities among the torque tube support fittings in the flap Differences Between Proposed AD, various levels of government. Therefore, primary drive, installation of a new it is determined that this proposal torque tube retainer tray assembly, and Canadian Airworthiness Directive, and Service Information would not have federalism implications installation of additional clamps to under Executive Order 13132. stabilize the flex shaft. The service bulletin and Canadian For the reasons discussed above, I The service bulletin also describes airworthiness directive refer only to a certify that this proposed regulation (1) procedures for functional tests after ‘‘visual inspection’’ for discrepancies of is not a ‘‘significant regulatory action’’ doing all applicable actions. the rear spar fittings. We have under Executive Order 12866; (2) is not Accomplishment of the actions determined that the procedures in the a ‘‘significant rule’’ under the DOT specified in the service bulletin is service bulletin should be described as Regulatory Policies and Procedures (44 intended to adequately address the a ‘‘detailed inspection.’’ Note 1 has been FR 11034, February 26, 1979); and (3) if identified unsafe condition. TCCA included in this proposed AD to define promulgated, will not have a significant classified this service bulletin as this type of inspection. economic impact, positive or negative, mandatory and issued Canadian Although the service bulletin on a substantial number of small entities airworthiness directive CF–2001–42, specifies to submit certain information under the criteria of the Regulatory dated , 2001, to ensure the to the manufacturer, this proposed AD Flexibility Act. A copy of the draft continued airworthiness of these does not include such a requirement. regulatory evaluation prepared for this airplanes in Canada. The applicability specified in the action is contained in the Rules Docket. service bulletin and Canadian FAA’s Conclusions A copy of it may be obtained by airworthiness directive includes Model contacting the Rules Docket at the These airplane models are DHC–8–314 airplanes; however, those location provided under the caption manufactured in Canada and are type airplanes are not U.S. type certificated ADDRESSES. certificated for operation in the United and are not included in the applicability States under the provisions of section in this proposed AD. List of Subjects in 14 CFR Part 39 21.29 of the Federal Aviation Cost Impact Air transportation, Aircraft, Aviation Regulations (14 CFR 21.29) and the safety, Safety. applicable bilateral airworthiness The FAA estimates that 218 airplanes agreement. Pursuant to this bilateral of U.S. registry would be affected by this The Proposed Amendment airworthiness agreement, TCCA has proposed AD. Accordingly, pursuant to the kept us informed of the situation It would take about 16 work hours per authority delegated to me by the described above. We have examined the rear spar fitting (two fittings per Administrator, the Federal Aviation findings of TCCA, reviewed all available airplane) to accomplish the proposed Administration proposes to amend part information, and determined that AD inspection, at an average labor rate of 39 of the Federal Aviation Regulations action is necessary for products of this $65 per work hour. Based on these (14 CFR part 39) as follows: type design that are certificated for figures, the cost impact of the inspection operation in the United States. proposed by this AD on U.S. operators PART 39—AIRWORTHINESS is estimated to be $453,440, or $2,080 DIRECTIVES Explanation of Requirements of per airplane, per inspection cycle. Proposed AD The cost impact figure discussed 1. The authority citation for part 39 continues to read as follows: Since an unsafe condition has been above is based on assumptions that no identified that is likely to exist or operator has yet done any of the Authority: 49 U.S.C. 106(g), 40113, 44701. develop on other airplanes of the same proposed requirements of this AD § 39.13 [Amended] type design registered in the United action, and that no operator would do 2. Section 39.13 is amended by States, the proposed AD would require those actions in the future if this AD adding the following new airworthiness accomplishment of the actions specified were not adopted. The cost impact directive: in the service bulletin described figures discussed in AD rulemaking previously, except as discussed below. actions represent only the time Bombardier, Inc. (Formerly de Havilland, This AD allows flight with wear necessary to do the specific actions Inc.): Docket 2003–NM–154–AD. damage, provided that (1) the wear actually required by the AD. These Applicability: Model DHC–8–102, –103, damage is within the limits specified in figures typically do not include –106, –201, –202, –301, –311, and –315 series the service bulletin, (2) no cracking is incidental costs, such as the time airplanes; certificated in any category; as listed in Bombardier Service Bulletin 8–27– found, and (3) established inspection required to gain access and close up, 83, Revision ‘‘A’’, dated February 8, 2002. procedures would find wear damage in planning time, or time necessitated by Compliance: Required as indicated, unless structure at intervals permitting repairs other administrative actions. accomplished previously. To find and fix to be done before reduced structural The optional terminating damage and prevent subsequent failure of the integrity of the fuselage could occur. modification, if done, would take about rear spar fittings between the flex shaft of the To be consistent with the findings of 16 work hours, at an average labor rate flap secondary drive and the wing-to-fuselage the TCCA, this proposed AD allows of $65 per work hour. Required parts structure, which could result in loss of the operators to continue the repetitive would cost about $365 per airplane. wing, accomplish the following: inspections instead of doing the Based on these figures, we estimate the Repetitive Inspections/Corrective Action terminating action. In making this cost of the optional terminating (a) For airplanes with rear spar fittings determination, we consider that, in the modification to be $1,405 per airplane. having part number (P/N) 85320053,

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66768 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

85322060, or 85334180: Within 12 months DEPARTMENT OF TRANSPORTATION the FAA, Los Angeles Aircraft after the effective date of this AD; do a Certification Office, 3960 Paramount detailed inspection for discrepancies Federal Aviation Administration Boulevard, Lakewood, California. (chafing, wear damage, cracking) of the rear FOR FURTHER INFORMATION CONTACT: spar fittings located between the flex shaft of 14 CFR Part 39 Samuel S. Lee, Aerospace Engineer, the flap secondary drive and the wing-to- Propulsion Branch, ANM–140L, FAA, fuselage structure. Do the inspection as [Docket No. 2002–NM–292–AD] Los Angeles Aircraft Certification defined in Parts III.A., III.B., and III.D. of the RIN 2120–AA64 Accomplishment Instructions of Bombardier Office, 3960 Paramount Boulevard, Lakewood, California 90712–4137; Service Bulletin 8–27–83, Revision ‘‘A’’, Airworthiness Directives; McDonnell telephone (562) 627–5338; fax (562) dated February 8, 2002; except where the Douglas Model MD–11 and MD–11F 627–5210. service bulletin specifies to report inspection Airplanes findings, this AD does not require such SUPPLEMENTARY INFORMATION: AGENCY: Federal Aviation reporting. Do the inspection per the service Comments Invited bulletin, and repeat the inspection thereafter Administration, DOT. at the applicable time specified in Part I.D. ACTION: Notice of proposed rulemaking Interested persons are invited to ‘‘Compliance’’ of the service bulletin. Any (NPRM). participate in the making of the applicable corrective action (high frequency proposed rule by submitting such eddy current inspection for cracking, SUMMARY: This document proposes the written data, views, or arguments as blending out wear damage, replacement of adoption of a new airworthiness they may desire. Communications shall rear spar fittings) must be done at the directive (AD) that is applicable to identify the Rules Docket number and applicable time specified in Part I.D. certain McDonnell Douglas Model MD– be submitted in triplicate to the address ‘‘Compliance’’ of the service bulletin. 11 and MD–11F airplanes. This specified above. All communications Note 1: For the purposes of this AD, a proposal would require repetitive received on or before the closing date detailed inspection is defined as: ‘‘An inspections of the transfer pipe for comments, specified above, will be intensive visual examination of a specific assembly installation for the tail tank for considered before taking action on the structural area, system, installation, or damage and cracks, and corrective proposed rule. The proposals contained assembly to detect damage, failure, or action, if necessary. This action is in this action may be changed in light irregularity. Available lighting is normally necessary to detect and correct damage of the comments received. supplemented with a direct source of good Submit comments using the following lighting at intensity deemed appropriate by and cracks to the transfer pipe assembly installation for the tail tank, which format: the inspector. Inspection aids such as mirror, • Organize comments issue-by-issue. magnifying lenses, etc., may be used. Surface could result in fuel leakage and possible For example, discuss a request to cleaning and elaborate access procedures ignition. This action is intended to may be required.’’ address the identified unsafe condition. change the compliance time and a DATES: Comments must be received by request to change the service bulletin Optional Terminating Modification reference as two separate issues. January 12, 2004. • (b) Modification of the flex shaft of the flap For each issue, state what specific ADDRESSES: Submit comments in change to the proposed AD is being secondary drive per Part III.C. of the triplicate to the Federal Aviation Accomplishment Instructions of Bombardier requested. Administration (FAA), Transport • Include justification (e.g., reasons or Service Bulletin 8–27–83, Revision ‘‘A’’, Airplane Directorate, ANM–114, dated February 8, 2002, terminates the data) for each request. Attention: Rules Docket No. 2002–NM– repetitive inspections required by paragraph Comments are specifically invited on (a) of this AD. 292–AD, 1601 Lind Avenue, SW., the overall regulatory, economic, Renton, Washington 98055–4056. environmental, and energy aspects of Actions Done per Previous Issue of Service Comments may be inspected at this the proposed rule. All comments Bulletins location between 9 a.m. and 3 p.m., submitted will be available, both before (c) Accomplishment of the inspections or Monday through Friday, except Federal and after the closing date for comments, the modification before the effective date of holidays. Comments may be submitted in the Rules Docket for examination by this AD in accordance with Bombardier via fax to (425) 227–1232. Comments interested persons. A report Service Bulletin 8–27–83, dated , may also be sent via the Internet using summarizing each FAA-public contact 2001, is considered acceptable for the following address: 9-anm- concerned with the substance of this compliance with the applicable actions [email protected]. Comments sent specified in this AD. proposal will be filed in the Rules via fax or the Internet must contain Docket. Alternative Methods of Compliance ‘‘Docket No. 2002–NM–292–AD’’ in the Commenters wishing the FAA to (d) In accordance with 14 CFR 39.19, the subject line and need not be submitted acknowledge receipt of their comments Manager, New York Aircraft Certification in triplicate. Comments sent via the submitted in response to this action Office, FAA, is authorized to approve Internet as attached electronic files must must submit a self-addressed, stamped alternative methods of compliance for this be formatted in Microsoft Word 97 or postcard on which the following AD. 2000 or ASCII text. statement is made: ‘‘Comments to Note 2: The subject of this AD is addressed The service information referenced in Docket Number 2002–NM–292–AD.’’ in Canadian airworthiness directive CF– the proposed rule may be obtained from The postcard will be date stamped and 2001–42, dated November 23, 2001. Boeing Commercial Aircraft Group, returned to the commenter. Long Beach Division, 3855 Lakewood Issued in Renton, Washington, on Boulevard, Long Beach, California Availability of NPRMs November 21, 2003. 90846, Attention: Data and Service Any person may obtain a copy of this Kalene C. Yanamura, Management, Dept. C1–L5A (D800– NPRM by submitting a request to the Acting Manager, Transport Airplane 0024). This information may be FAA, Transport Airplane Directorate, Directorate, Aircraft Certification Service. examined at the FAA, Transport ANM–114, Attention: Rules Docket No. [FR Doc. 03–29698 Filed 11–26–03; 8:45 am] Airplane Directorate, 1601 Lind 2002–NM–292–AD, 1601 Lind Avenue, BILLING CODE 4910–13–P Avenue, SW., Renton, Washington; or at SW., Renton, Washington 98055–4056.

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66769

Discussion Interim Action under the criteria of the Regulatory The FAA has received reports of This proposed AD is considered to be Flexibility Act. A copy of the draft cracks and damage to the transfer pipe interim action. The manufacturer has regulatory evaluation prepared for this assembly installation for the tail tank on advised that it currently is developing action is contained in the Rules Docket. McDonnell Douglas Model MD–11 Service Bulletin MD11–28–111 that will A copy of it may be obtained by airplanes. The support brackets and address the unsafe condition addressed contacting the Rules Docket at the clamps for the refuel and fuel transfer by this proposed AD. Once this new location provided under the caption ADDRESSES. lines of the tail fuel tank are being service bulletin is developed, approved, cracked and damaged, resulting in and available, the FAA may consider List of Subjects in 14 CFR Part 39 chafing and denting of the transfer pipe additional rulemaking. Air transportation, Aircraft, Aviation assembly. The cause of the cracks and Cost Impact safety, Safety. damage is transient pressure surges that are higher than designed for the fuel There are approximately 187 The Proposed Amendment transfer piping configuration during fuel airplanes of the affected design in the Accordingly, pursuant to the transfer operations. This condition, if worldwide fleet. The FAA estimates that authority delegated to me by the not corrected, could result in damage 60 airplanes of U.S. registry would be Administrator, the Federal Aviation and cracks to the transfer pipe assembly affected by this proposed AD, that it Administration proposes to amend part installation for the tail tank, which would take approximately 2 work hours 39 of the Federal Aviation Regulations could result in fuel leakage and possible per airplane to accomplish the proposed (14 CFR part 39) as follows: ignition. inspection, and that the average labor The subject area on certain Model rate is $65 per work hour. Based on PART 39—AIRWORTHINESS MD–11F airplanes is almost identical to these figures, the cost impact of the DIRECTIVES that on the affected Model MD–11 proposed AD on U.S. operators is 1. The authority citation for part 39 airplanes. Therefore, those MD–11F estimated to be $7,800, or $130 per continues to read as follows: airplanes may be subject to the unsafe airplane, per inspection cycle. condition revealed on the MD–11 The cost impact figures discussed Authority: 49 U.S.C. 106(g), 40113, 44701. above are based on assumptions that no airplanes. § 39.13 [Amended] operator has yet accomplished any of Explanation of Relevant Service the proposed requirements of this AD 2. Section 39.13 is amended by Information action, and that no operator would adding the following new airworthiness The FAA has reviewed and approved accomplish those actions in the future if directive: McDonnell Douglas Alert Service this proposed AD were not adopted. The McDonnell Douglas: Docket 2002–NM–292– Bulletin MD11–28A110, dated May 2, cost impact figures discussed in AD AD. 2000, which describes procedures for rulemaking actions represent only the Applicability: Model MD–11 and MD–11F performing repetitive inspections of the time necessary to perform the specific airplanes, as listed in McDonnell Douglas Alert Service Bulletin MD11–28A110, dated transfer pipe assembly installation for actions actually required by the AD. May 2, 2000; certificated in any category. the tail tank for damage and cracks; and These figures typically do not include Compliance: Required as indicated, unless repairing and/or replacing any damaged incidental costs, such as the time accomplished previously. or cracked part with a serviceable part. required to gain access and close up, To detect and correct damage and cracks to planning time, or time necessitated by the transfer pipe assembly installation for the Explanation of Requirements of other administrative actions. tail tank, which could result in fuel leakage Proposed Rule Manufacturer warranty remedies may be and possible ignition, accomplish the Since an unsafe condition has been available for labor costs associated with following: identified that is likely to exist or this proposed AD. As a result, the costs Service Bulletin References develop on other products of this same attributable to the proposed AD may be (a) The term ‘‘service bulletin,’’ as used in type design, the proposed AD would less than stated above. this AD, means the Accomplishment require accomplishment of the actions Regulatory Impact Instructions of McDonnell Douglas Alert specified in the service bulletin Service Bulletin MD11–28A110, dated May described previously. Although the The regulations proposed herein 2, 2000. Although the service bulletin service bulletin referenced in the would not have a substantial direct referenced in this AD specifies to submit proposed AD specifies to submit certain effect on the States, on the relationship certain information to the manufacturer, this information to the manufacturer, the between the national Government and AD does not include such a requirement. proposed AD does not include such a the States, or on the distribution of Initial Inspection requirement. power and responsibilities among the (b) Within 700 flight hours from the various levels of government. Therefore, Clarification of Service Bulletin effective date of this AD, perform a general it is determined that this proposal visual inspection to detect any damage and Applicability would not have federalism implications cracking on the transfer pipe assembly The FAA points out that McDonnell under Executive Order 13132. installation for the tail tank, in accordance Douglas Model MD–11F airplanes are For the reasons discussed above, I with the service bulletin. not specifically identified in the service certify that this proposed regulation (1) Note 1: For the purposes of this AD, a bulletin. However, those airplanes are is not a ‘‘significant regulatory action’’ general visual inspection is defined as: ‘‘A identified by manufacturer’s fuselage under Executive Order 12866; (2) is not visual examination of an interior or exterior numbers in the service bulletin a ‘‘significant rule’’ under the DOT area, installation, or assembly to detect obvious damage, failure, or irregularity. This effectivity listing. Therefore, the FAA Regulatory Policies and Procedures (44 level of inspection is made from within has revised the applicability in the FR 11034, February 26, 1979); and (3) if touching distance unless otherwise specified. NPRM to include Model MD–11F promulgated, will not have a significant A mirror may be necessary to enhance visual airplanes, in addition to Model MD–11 economic impact, positive or negative, access to all exposed surfaces in the airplanes. on a substantial number of small entities inspection area. This level of inspection is

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66770 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

made under normally available lighting lockpins for excessive wear; and for comments, specified above, will be conditions such as daylight, hangar lighting, corrective actions, if necessary. This considered before taking action on the flashlight, or droplight and may require action is necessary to prevent proposed rule. The proposals contained removal or opening of access panels or doors. uncommanded seat movement during in this action may be changed in light Stands, ladders, or platforms may be required to gain proximity to the area being checked.’’ takeoff and/or landing, which could of the comments received. result in interference with the operation Submit comments using the following Condition 1 (No Damage/Cracking) of the airplane and consequent format: • (c) If no damage or cracking to the transfer temporary loss of control of the Organize comments issue-by-issue. pipe assembly installation for the tail tank is airplane. This action is intended to For example, discuss a request to found during the inspection required by address the identified unsafe condition. change the compliance time and a paragraph (b) of this AD, repeat that DATES: Comments must be received by request to change the service bulletin inspection thereafter at intervals not to January 12, 2004. reference as two separate issues. exceed 700 flight hours. • For each issue, state what specific ADDRESSES: Submit comments in change to the proposed AD is being Condition 2 (Damage/Cracking Found) triplicate to the Federal Aviation requested. Administration (FAA), Transport (d) If any damage or cracking to the transfer • Include justification (e.g., reasons or pipe assembly installation for the tail tank is Airplane Directorate, ANM–114, found during the inspection required by data) for each request. Attention: Rules Docket No. 2002–NM– Comments are specifically invited on paragraph (b) of this AD, before further flight, 176–AD, 1601 Lind Avenue, SW., repair and/or replace any damaged or the overall regulatory, economic, Renton, Washington 98055–4056. environmental, and energy aspects of cracked part with a serviceable part, per the Comments may be inspected at this service bulletin. Repeat that inspection the proposed rule. All comments thereafter at intervals not to exceed 700 flight location between 9 a.m. and 3 p.m., submitted will be available, both before hours. Monday through Friday, except Federal and after the closing date for comments, holidays. Comments may be submitted Alternative Methods of Compliance in the Rules Docket for examination by via fax to (425) 227–1232. Comments interested persons. A report (e) In accordance with 14 CFR 39.19, the may also be sent via the Internet using summarizing each FAA-public contact Manager, Los Angeles Aircraft Certification the following address: 9-anm- Office, FAA, is authorized to approve concerned with the substance of this [email protected]. Comments sent proposal will be filed in the Rules alternative methods of compliance for this via fax or the Internet must contain AD. Docket. ‘‘Docket No. 2002–NM–176–AD’’ in the Issued in Renton, Washington, on Commenters wishing the FAA to subject line and need not be submitted acknowledge receipt of their comments November 21, 2003. in triplicate. Comments sent via the Kalene C. Yanamura, submitted in response to this action Internet as attached electronic files must must submit a self-addressed, stamped Acting Manager, Transport Airplane be formatted in Microsoft Word 97 or Directorate, Aircraft Certification Service. postcard on which the following 2000 or ASCII text. statement is made: ‘‘Comments to [FR Doc. 03–29699 Filed 11–26–03; 8:45 am] The service information referenced in Docket Number 2002–NM–176–AD.’’ BILLING CODE 4910–13–P the proposed rule may be obtained from The postcard will be date stamped and Boeing Commercial Aircraft Group, returned to the commenter. Long Beach Division, 3855 Lakewood DEPARTMENT OF TRANSPORTATION Boulevard, Long Beach, California Availability of NPRMs 90846, Attention: Data and Services Federal Aviation Administration Any person may obtain a copy of this Management, Dept. C1–L5A (D800– NPRM by submitting a request to the 0024). This information may be 14 CFR Part 39 FAA, Transport Airplane Directorate, examined at the FAA, Transport ANM–114, Attention: Rules Docket No. [Docket No. 2002–NM–176–AD] Airplane Directorate, 1601 Lind 2002–NM–176–AD, 1601 Lind Avenue, Avenue, SW., Renton, Washington; or at SW., Renton, Washington 98055–4056. RIN 2120–AA64 the FAA, Los Angeles Aircraft Certification Office, 3960 Paramount Discussion Airworthiness Directives; McDonnell Boulevard, Lakewood, California. Douglas Model DC–8–11, DC–8–12, The FAA has received reports that on DC–8–21, DC–8–31, DC–8–32, DC–8– FOR FURTHER INFORMATION CONTACT: three instances the captain’s and/or first 33, DC–8–41, DC–8–42, DC–8–43, DC– Cheyenne Del Carmen, Aerospace officer’s seat(s) unexpectedly moved full 8F–54, and DC–8F–55 Airplanes; and Engineer, Systems and Equipment aft during takeoff of certain McDonnell Model DC–8–50, –60, –60F, –70 and Branch, ANM–130L, FAA, Los Angeles Douglas Model DC–9–41 and DC–9– –70F Series Airplanes Aircraft Certification Office, 3960 33RC airplanes. The cause of the Paramount Boulevard, Lakewood, uncommanded seat movement has been AGENCY: Federal Aviation California 90712–4137; telephone (562) attributed to marginal engagement Administration, DOT. 627–5338; fax (562) 627–5210. between the seat locking pins and the ACTION: Notice of proposed rulemaking SUPPLEMENTARY INFORMATION: detent holes of the seat track of the (NPRM). captain’s and first officer’s seat Comments Invited assemblies. This condition, if not SUMMARY: This document proposes the Interested persons are invited to corrected, could lead to uncommanded adoption of a new airworthiness participate in the making of the seat movement during takeoff and/or directive (AD) that is applicable to proposed rule by submitting such landing, which could result in certain McDonnell Douglas airplane written data, views, or arguments as interference with the operation of the models. This proposal would require they may desire. Communications shall airplane and consequent temporary loss inspection of the captain’s and first identify the Rules Docket number and of control of the airplane. officer’s seat locking pins for minimum be submitted in triplicate to the address The captain’s and first officer’s seat engagement with the detent holes in the specified above. All communications assemblies on certain Model DC–9–41 seat tracks; inspection of the seat received on or before the closing date and DC–9–33RC airplanes are identical

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66771

to those installed on certain Model DC– minimum engagement with the detent type design, the proposed AD would 8–11, DC–8–12, DC–8–21, DC–8–31, holes in the seat tracks; a detailed require accomplishment of the actions DC–8–32, DC–8–33, DC–8–41, DC–8–42, inspection of the seat lockpins for specified in the service bulletin DC–8–43, DC–8F–54, and DC–8F–55 excessive wear; and corrective actions, described previously. airplanes and certain Model DC–8–50, if necessary. The corrective actions –60, –60F, –70 and –70F series include adjusting/replacing the seat Cost Impact airplanes. Therefore, all of these models locking pin with a new pin and/or There are approximately 497 may be subject to the identified unsafe adjusting/repairing/replacing the seat airplanes of the affected design in the condition. track with a new track. Accomplishment of the actions specified in the service worldwide fleet. The FAA estimates that Explanation of Relevant Service bulletin is intended to adequately 360 airplanes of U.S. registry would be Information address the identified unsafe condition. affected by this proposed AD. Table 1 The FAA has reviewed and approved shows the estimated cost impact, based Boeing Alert Service Bulletin DC8– Explanation of Requirements of upon the action taken, for airplanes 25A244, Revision 02, dated , Proposed Rule affected by this proposed AD. The 2002, which describes procedures for a Since an unsafe condition has been average labor rate is $65 per work hour. detailed inspection of the captain’s and identified that is likely to exist or first officer’s seat locking pins for develop on other products of this same

TABLE 1.—COST IMPACT

Action Work hours Work hours Cost per Maximum per seat per airplane airplane fleet cost

Inspection for Option 1 ...... 1 2 $130 $46,800 Inspection for Option 2 ...... 3 6 390 140,400

The cost impact figures discussed action is contained in the Rules Docket. Compliance: Required as indicated, unless above are based on assumptions that no A copy of it may be obtained by accomplished previously. operator has yet accomplished any of contacting the Rules Docket at the To prevent uncommanded seat movement during takeoff and/or landing, which could the proposed requirements of this AD location provided under the caption result in interference with the operation of action, and that no operator would ADDRESSES. the airplane and consequent temporary loss accomplish those actions in the future if List of Subjects in 14 CFR Part 39 of control of the airplane, accomplish the this proposed AD were not adopted. The following: cost impact figures discussed in AD Air transportation, Aircraft, Aviation Inspection for Engagement and Excessive rulemaking actions represent only the safety, Safety. Wear of the Seat Locking Pins time necessary to perform the specific The Proposed Amendment (a) Within 18 months after the effective actions actually required by the AD. date of this AD, do the actions specified in These figures typically do not include Accordingly, pursuant to the paragraphs (a)(1) and (a)(2) of this AD, per incidental costs, such as the time authority delegated to me by the either Option 1 or Option 2 of the required to gain access and close up, Administrator, the Federal Aviation Accomplishment Instructions of Boeing Alert planning time, or time necessitated by Administration proposes to amend part Service Bulletin DC8–25A244, Revision 02, other administrative actions. 39 of the Federal Aviation Regulations dated June 25, 2002. (14 CFR part 39) as follows: (1) Do a detailed inspection of the seat Regulatory Impact locking pin for minimum engagement with The regulations proposed herein PART 39—AIRWORTHINESS the detent holes in the seat track of the captain’s and first officer’s seat assemblies. would not have a substantial direct DIRECTIVES Note 1: For the purposes of this AD, a effect on the States, on the relationship detailed inspection is defined as: ‘‘An between the national Government and 1. The authority citation for part 39 continues to read as follows: intensive visual examination of a specific the States, or on the distribution of structural area, system, installation, or power and responsibilities among the Authority: 49 U.S.C. 106(g), 40113, 44701. assembly to detect damage, failure, or various levels of government. Therefore, irregularity. Available lighting is normally § 39.13 [Amended] it is determined that this proposal supplemented with a direct source of good would not have federalism implications 2. Section 39.13 is amended by lighting at intensity deemed appropriate by under Executive Order 13132. adding the following new airworthiness the inspector. Inspection aids such as mirror, directive: magnifying lenses, etc., may be used. Surface For the reasons discussed above, I cleaning and elaborate access procedures certify that this proposed regulation (1) McDonnell Douglas: Docket 2002–NM–176– may be required.’’ is not a ‘‘significant regulatory action’’ D. (2) Do a detailed inspection of the seat lock under Executive Order 12866; (2) is not Applicability: Model DC–8–11, DC–8–12, pins for excessive wear. a ‘‘significant rule’’ under the DOT DC–8–21, DC–8–31, DC–8–32, DC–8–33, DC– Regulatory Policies and Procedures (44 8–41, DC–8–42, DC–8–43, DC–8–51, DC–8– Corrective Actions FR 11034, February 26, 1979); and (3) if 52, DC–8–53, DC–8F–54, DC–8–55, DC–8F– (b) If any discrepancy is detected during promulgated, will not have a significant 55, DC–8–61, DC–8–61F, DC–8–62, DC–8– the inspection required by paragraph (a) of 62F, DC–8–63, DC–8–63F, DC–8–71, DC–8– economic impact, positive or negative, this AD, before further flight, do the 71F, DC–8–72, DC–8–72F, DC–8–73, and DC– corrective action(s), per either Option 1 or on a substantial number of small entities 8–73F airplanes, as listed in Boeing Alert Option 2 of the Accomplishment Instructions under the criteria of the Regulatory Service Bulletin DC8–25A244, Revision 02, of Boeing Alert Service Bulletin DC8– Flexibility Act. A copy of the draft dated June 25, 2002; certificated in any 25A244, Revision 02, dated June 25, 2002, as regulatory evaluation prepared for this category. applicable. Those corrective actions include

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00010 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66772 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

adjusting/replacing the seat locking pin with the following address: 9-anm- must submit a self-addressed, stamped a new pin and/or adjusting/repairing/ [email protected]. Comments sent postcard on which the following replacing the seat track with a new track. via fax or the Internet must contain statement is made: ‘‘Comments to Alternative Methods of Compliance ‘‘Docket No. 2001–NM–376–AD’’ in the Docket Number 2001–NM–376–AD.’’ (c) In accordance with 14 CFR 39.19, the subject line and need not be submitted The postcard will be date stamped and Manager, Los Angeles Aircraft Certification in triplicate. Comments sent via the returned to the commenter. Internet as attached electronic files must Office, FAA, is authorized to approve Availability of NPRMs alternative methods of compliance for this be formatted in Microsoft Word 97 or AD. 2000 or ASCII text. Any person may obtain a copy of this Issued in Renton, Washington, on The service information referenced in NPRM by submitting a request to the November 21, 2003. the proposed rule may be obtained from FAA, Transport Airplane Directorate, Kalene C. Yanamura, Aerospatiale, 316 Route de Bayonne, ANM–114, Attention: Rules Docket No. 2001–NM–376–AD, 1601 Lind Avenue, Acting Manager, Transport Airplane 31060 Toulouse, Cedex 03, France. This Directorate, Aircraft Certification Service. information may be examined at the SW., Renton, Washington 98055–4056. [FR Doc. 03–29700 Filed 11–26–03; 8:45 am] FAA, Transport Airplane Directorate, Discussion BILLING CODE 4910–13–P 1601 Lind Avenue, SW., Renton, Washington. On , 2000, the FAA issued AD 2000–04–13, amendment 39–11596 FOR FURTHER INFORMATION CONTACT: (65 FR 10381, , 2000), DEPARTMENT OF TRANSPORTATION Tony Jopling, Aerospace Engineer, applicable to certain Aerospatiale Model International Branch, ANM–116, FAA, Federal Aviation Administration ATR72 series airplanes, to require initial Transport Airplane Directorate, 1601 and repetitive inspections to detect Lind Avenue, SW., Renton, Washington 14 CFR Part 39 fatigue cracking in certain areas of the 98055–4056; telephone (425) 227–2190; fuselage, and corrective actions if [Docket No. 2001–NM–376–AD] fax (425) 227–1149. necessary. That action was prompted by RIN 2120–AA64 SUPPLEMENTARY INFORMATION: issuance of mandatory continuing Comments Invited airworthiness information by a foreign Airworthiness Directives; Aerospatiale civil airworthiness authority. The Model ATR72 Series Airplanes Interested persons are invited to requirements of that AD are intended to participate in the making of the prevent fatigue cracking of the fuselage AGENCY: Federal Aviation proposed rule by submitting such and the passenger and service doors, Administration, DOT. written data, views, or arguments as which could result in reduced structural ACTION: Notice of proposed rulemaking they may desire. Communications shall integrity of the airplane. (NPRM). identify the Rules Docket number and be submitted in triplicate to the address Actions Since Issuance of Previous Rule SUMMARY: This document proposes the specified above. All communications Since the issuance of AD 2000–04–13, supersedure of an existing airworthiness received on or before the closing date the Direction Ge´ne´rale de l’Aviation directive (AD), applicable to certain for comments, specified above, will be Civile (DGAC), which is the Aerospatiale Model ATR72 series considered before taking action on the airworthiness authority for France, airplanes, that currently requires initial proposed rule. The proposals contained notified the FAA that an unsafe and repetitive inspections to detect in this action may be changed in light condition may continue to exist on fatigue cracking in certain areas of the of the comments received. certain ATR72 series airplanes on which fuselage, and corrective actions if Submit comments using the following Aerospatiale Modification 3191 necessary. For certain airplanes, this format: (specified in Service Bulletin ATR72– action would require a new inspection • Organize comments issue-by-issue. 52–1018, dated , 1995, which is for oversized fastener holes and For example, discuss a request to required by the existing AD) has not cracking, and repair if necessary. The change the compliance time and a been done, but Aerospatiale actions specified by the proposed AD request to change the service bulletin Modification 3184 (accomplished are intended to prevent fatigue cracking reference as two separate issues. during production and unrelated to the of the fuselage and the passenger and • For each issue, state what specific actions of the existing AD) has been service doors, which could result in change to the proposed AD is being done. Investigation revealed that during reduced structural integrity of the requested. fatigue testing of these airplanes, airplane. This action is intended to • Include justification (e.g., reasons or damage was found at the attachment address the identified unsafe condition. data) for each request. holes at the hinge fitting of the cargo DATES: Comments must be received by Comments are specifically invited on compartment door outer skin due to December 29, 2003. the overall regulatory, economic, oversized fastener holes drilled during ADDRESSES: Submit comments in environmental, and energy aspects of incorporation of Modification 3184. triplicate to the Federal Aviation the proposed rule. All comments Administration (FAA), Transport submitted will be available, both before Explanation of Relevant Service Airplane Directorate, ANM–114, and after the closing date for comments, Information Attention: Rules Docket No. 2001–NM– in the Rules Docket for examination by The manufacturer has issued Avions 376–AD, 1601 Lind Avenue, SW., interested persons. A report de Transport Regional Service Bulletin Renton, Washington 98055–4056. summarizing each FAA-public contact ATR72–52–1018, Revision 1, dated Comments may be inspected at this concerned with the substance of this , 2001. The original issue of location between 9 a.m. and 3 p.m., proposal will be filed in the Rules the service bulletin was referenced as Monday through Friday, except Federal Docket. the appropriate source of service holidays. Comments may be submitted Commenters wishing the FAA to information for the accomplishment of via fax to (425) 227–1232. Comments acknowledge receipt of their comments certain inspections and corrective may also be sent via the Internet using submitted in response to this action actions specified in the existing AD. For

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00011 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66773

airplanes on which Aerospatiale Differences Between Proposed AD and For airplanes identified in Avions de Modification 3191 has not been done, Service Bulletin Transport Regional Service Bulletin but Aerospatiale Modification 3184 has The service bulletin specifies that the ATR72–52–1033, and ATR72–52–1029, been done, Revision 1 adds procedures manufacturer should be notified if the Revision 1 (2 U.S.-registered airplanes), for a detailed visual inspection of the measured diameter of the fastener holes it will take approximately 145 work fastener holes at the hinge fitting of the is out of tolerance, but this proposed AD hours per airplane to accomplish the cargo compartment doors to determine does not include such a requirement. required door stop fitting replacement, if the holes are oversized, and the outer The service bulletin also describes at an average labor rate of $65 per work skin around the fastener holes for procedures for completing an inspection hour. Required parts are provided by the cracking, and repair of any report and submitting it to the manufacturer at no cost to the operators. discrepancies found. For airplanes on manufacturer, but this proposed AD Based on these figures, the cost impact which neither modification 3191 nor would not require those actions. We do of the stop fittings replacement required by this AD on U.S. operators is 3184 has been done, the new actions not need this information from estimated to be $18,850 or $9,425 per specified in Revision 1 of the service operators. airplane. bulletin need not be done. The DGAC Cost Impact For airplanes identified in Avions de classified this service bulletin as There are approximately 39 airplanes Transport Regional Service Bulletin mandatory and issued French of U.S. registry that would be affected ATR72–53–1021, Revision 1 (2 U.S.- airworthiness directive 2001–142– by this proposed AD. registered airplanes) it will take 056(B), dated , 2001, to ensure The actions that are currently approximately 30 work hours per the continued airworthiness of these required by AD 2000–04–13 are as airplane to accomplish the proposed airplanes in France. The new French follows: actions, at an average labor rate of $65 airworthiness directive covers all the For airplanes identified in Avions de per work hour. Based on these figures, service bulletins specified in the Transport Regional Service Bulletin the cost impact of these actions required existing AD, and replaces French ATR72–53–1018 (14 U.S.-registered by this AD on U.S. operators is airworthiness directive 92–046– airplanes), it takes approximately 250 estimated to be $3,900, or $1,950 per 012(B)R4, dated , 1997; work hours per airplane to accomplish airplane. which was referenced in the existing the required actions, at an average labor For airplanes identified in Avions de AD. rate of $65 per work hour. Required Transport Regional Service Bulletin parts will cost approximately $9,880 per ATR72–53–1014, Revision 2 (2 U.S.- FAA’s Conclusions airplane. Based on these figures, the cost registered airplanes), it will take impact of these actions required by this approximately 8 work hours per This airplane model is manufactured AD on U.S. operators is estimated to be airplane to accomplish the required in France and is type certificated for $365,820, or $26,130 per airplane. actions, at an average labor rate of $65 operation in the United States under the For airplanes identified in Avions de per work hour. Based on these figures, provisions of section 21.29 of the Transport Regional Service Bulletin the cost impact of these actions required Federal Aviation Regulations (14 CFR ATR72–52–1013, Revision 2 (2 U.S.- by this AD on U.S. operators is 21.29) and the applicable bilateral registered airplanes), it will take estimated to be $1,040, or $520 per airworthiness agreement. Pursuant to approximately 3 work hours per airplane. this bilateral airworthiness agreement, airplane to accomplish the required For airplanes identified in Avions de the DGAC has kept us informed of the actions, at an average labor rate of $65 Transport Regional Service Bulletin situation described above. We have per work hour. Based on these figures, ATR72–53–1020 (14 U.S.-registered examined the findings of the DGAC, the cost impact of these actions required airplanes), it will take approximately 6 reviewed all available information, and by this AD on U.S. operators is work hours per airplane to accomplish determined that AD action is necessary estimated to be $390, or $195 per the required actions, at an average labor for products of this type design that are airplane. rate of $65 per work hour. Based on certificated for operation in the United For airplanes identified in Avions de these figures, the cost impact of these States. Transport Regional Service Bulletin actions required by this AD on U.S. ATR72–52–1019, Revision 2 (2 U.S.- operators is estimated to be $5,460, or Explanation of Requirements of registered airplanes), it will take $390 per airplane. Proposed AD approximately 100 work hours per The new actions proposed in this AD airplane to accomplish the required are as follows: Since an unsafe condition has been actions, at an average labor rate of $65 For airplanes identified in Avions de identified that is likely to exist or per work hour. Based on these figures, Transport Regional Service Bulletin develop on other airplanes of the same the cost impact of these actions required ATR72–53–1018, Revision 1, type design registered in the United by this AD on U.S. operators is accomplishment of the new proposed States, the proposed AD would estimated to be $13,000, or $6,500 per actions, if required, would take supersede AD 2000–04–13 to continue airplane. approximately 250 work hours per to require initial and repetitive For airplanes identified in Avions de airplane to accomplish, at an average inspections to detect fatigue cracking in Transport Regional Service Bulletin labor rate of $65 per work hour. certain areas of the fuselage, and ATR72–52–1028 (2 U.S.-registered Required parts would cost corrective actions if necessary. For airplanes), it will take approximately 5 approximately $9,880 per airplane. certain airplanes, the proposed AD also work hours per airplane to accomplish Based on these figures, the cost impact would require repair of oversized the required actions, at an average labor of the new actions proposed by this AD fastener holes. The actions would be rate of $65 per work hour. Based on on U.S. operators is estimated to be required to be accomplished in these figures, the cost impact of these $26,130 per airplane. accordance with the service bulletin actions required by this AD on U.S. The cost impact figures discussed described previously, except as operators is estimated to be $650 or above are based on assumptions that no discussed below. $325 per airplane, per inspection cycle. operator has yet accomplished any of

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66774 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

the current or proposed requirements of Aerospatiale: Docket 2001–NM–376–AD. (i) If any discrepancy is detected, prior to this AD action, and that no operator Supersedes AD 2000–04–13, further flight, repair in accordance with a would accomplish those actions in the Amendment 39–11596. method approved by the Manager, future if this AD were not adopted. The Applicability: Model ATR72 series International Branch, ANM–116, Transport Airplane Directorate; or the Direction cost impact figures discussed in AD airplanes; certificated in any category; listed in the following Avions de Transport Ge´ne´rale de l’Aviation Civile (DGAC) (or its rulemaking actions represent only the delegated agent). time necessary to perform the specific Regional Service Bulletins: • ATR72–52–1018, dated May 18, 1995; (ii) If no discrepancy is detected, prior to actions actually required by the AD. • ATR72–52–1018, Revision 1, dated further flight, replace the cargo compartment These figures typically do not include March 13, 2001; door hinges with new hinges in accordance with Part B of the Accomplishment incidental costs, such as the time • ATR72–53–1013, Revision 2, dated Instructions of the service bulletin. required to gain access and close up, , 1993; (3) Remove the existing fasteners, repair, planning time, or time necessitated by • ATR72–53–1019, Revision 2, dated and replace the cargo compartment door October 15, 1996; other administrative actions. hinges with new hinges in accordance with • ATR72–52–1028, dated , 1993; Part C of the Accomplishment Instructions of Regulatory Impact • ATR72–52–1033, dated , 1995; the service bulletin. • ATR72–52–1029, Revision 1, dated The regulations proposed herein (b) For airplanes having serial numbers 108 November 16, 1994; would not have a substantial direct through 210 inclusive: Prior to the • ATR72–53–1021, Revision 1, dated accumulation of 36,000 total flight cycles, or effect on the States, on the relationship , 1995; between the national Government and • within 1 month after , 2000, ATR72–53–1014, Revision 2, dated whichever occurs later, perform a one-time the States, or on the distribution of October 15, 1992; and power and responsibilities among the • visual inspection to determine if rivets are ATR72–53–1020, dated , 1992. installed in the key holes located on main various levels of government. Therefore, Compliance: Required as indicated, unless frames 25 and 27 of the fuselage, between it is determined that this proposal accomplished previously. stringers 14 and 15, in accordance with would not have federalism implications To prevent fatigue cracking of the fuselage Avions de Transport Regional Service under Executive Order 13132. and the passenger and service doors, which Bulletin ATR72–53–1013, Revision 3, dated For the reasons discussed above, I could result in reduced structural integrity of , 1999. the airplane, accomplish the following: certify that this proposed regulation (1) (1) If all rivets are installed, no further is not a ‘‘significant regulatory action’’ Restatement of Requirements of AD 2000– action is required by paragraph (b) of this under Executive Order 12866; (2) is not 04–13 AD. a ‘‘significant rule’’ under the DOT (2) If any rivet is missing, prior to further Inspections/Corrective Actions flight, perform an eddy current inspection of Regulatory Policies and Procedures (44 (a) For airplanes on which Aerospatiale the affected key holes to detect cracks, in FR 11034, February 26, 1979); and (3) if Modification 03191 (reference Avions de accordance with the service bulletin. promulgated, will not have a significant Transport Regional Service Bulletin ATR72– (i) If no crack is detected during the economic impact, positive or negative, 52–1018) has not been accomplished as of inspection required by paragraph (b)(2) of on a substantial number of small entities April 3, 2000 (the effective date of AD 2000– this AD, prior to further flight, install rivets under the criteria of the Regulatory 04–13, amendment 39–11596); prior to the in all affected key holes, in accordance with Flexibility Act. A copy of the draft accumulation of 27,000 total flight cycles, or the service bulletin. If installation of rivets is regulatory evaluation prepared for this within 30 days after April 3, 2000: Perform not possible, prior to further flight, repair in action is contained in the Rules Docket. a preliminary inspection of the existing accordance with a method approved by the fasteners to determine if the fasteners are out Manager, International Branch, ANM–116; or A copy of it may be obtained by of tolerance in accordance with paragraph the DGAC (or its delegated agent). contacting the Rules Docket at the 2.C.(1) of the Accomplishment Instructions of (ii) If any crack is detected during the location provided under the caption Avions de Transport Regional Service inspection required by paragraph (b)(2) of ADDRESSES. Bulletin ATR72–52–1018, dated May 18, this AD, prior to further flight, repair in 1995. Depending on the results of the accordance with a method approved by the List of Subjects in 14 CFR Part 39 inspection, prior to further flight, accomplish Manager, International Branch, ANM–116; or Air transportation, Aircraft, Aviation the requirements in paragraphs (a)(1) and the DGAC (or its delegated agent). safety, Safety. (a)(2), or (a)(2) and (a)(3) of this AD, as (c) For airplanes having serial numbers 108 applicable. through 207 inclusive: Prior to the The Proposed Amendment (1) Remove the fasteners and inspect the accumulation of 36,000 total flight cycles, or Accordingly, pursuant to the fastener holes to determine if they are out of within 1 month after April 3, 2000, tolerance or cracking, in accordance with whichever occurs later, perform a one-time authority delegated to me by the Part A of the Accomplishment Instructions of visual inspection to determine if rivets are Administrator, the Federal Aviation the service bulletin. Perform a visual installed in the tooling and key holes located Administration proposes to amend part inspection of the holes for correct tolerance, on the standard frames of the fuselage, in 39 of the Federal Aviation Regulations and a high frequency eddy current (HFEC) accordance with Avions de Transport (14 CFR part 39) as follows: inspection for cracking, in accordance with Regional Service Bulletin ATR72–53–1019, the service bulletin. Revision 3, dated January 22, 1999. PART 39—AIRWORTHINESS (i) If any discrepancy is detected, prior to (1) If all rivets are installed, no further DIRECTIVES further flight, repair in accordance with Part action is required by paragraph (c) of this AD. C of the Accomplishment Instructions of the (2) If any rivet is missing, prior to further 1. The authority citation for part 39 service bulletin. flight, perform a visual inspection of the continues to read as follows: (ii) If no discrepancy is detected, prior to affected tooling and key holes to detect Authority: 49 U.S.C. 106(g), 40113, 44701. further flight, replace the cargo compartment cracks, in accordance with the service door hinges with new hinges in accordance bulletin. § 39.13 [Amended] with Part A of the Accomplishment (i) If no crack is detected during the Instructions of the service bulletin. inspection required by paragraph (c)(2) of 2. Section 39.13 is amended by (2) Remove the existing fasteners and this AD, prior to further flight, install new removing amendment 39–11596 (65 FR inspect the fastener holes for correct rivets in all affected tooling and key holes, 10381, February 28, 2000), and by tolerance in accordance with Part B of the in accordance with the service bulletin. adding a new airworthiness directive Accomplishment Instructions of the service (ii) If any crack is detected during the (AD), to read as follows: bulletin. inspection required by paragraph (c)(2) of

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66775

this AD, prior to further flight, repair in AD, prior to further flight, repair and modify (1) For airplanes on which Aerospatiale accordance with a method approved by the in accordance with a method approved by Modification 3191 and Aerospatiale Manager, International Branch, ANM–116; or the Manager, International Branch, ANM– Modification 3184 have not been the DGAC (or its delegated agent). 116; or the DGAC (or its delegated agent). accomplished as of the effective date of this (d) For airplanes on which Aerospatiale (g) For airplanes on which Aerospatiale AD: No further action is required by Modification 03775 (reference Avions de Modification 02397 (reference Avions de paragraph (i) of this AD. Transport Regional Service Bulletin ATR72– Transport Regional Service Bulletin ATR72– 52–1029, Revision 1, dated November 16, 53–1014, Revision 2, dated October 15, 1992) (2) For airplanes on which Aerospatiale 1994) or Aerospatiale Modification 03776 has not been accomplished as of April 3, Modification 3191 has not been (reference Avions de Transport Regional 2000: Prior to the accumulation of 12,000 accomplished as of the effective date of this Service Bulletin ATR72–52–1033, dated total flight cycles, or within 1 month after AD, and Aerospatiale Modification 3184 has April 28, 1995) has not been accomplished as April 3, 2000, whichever occurs later, been accomplished as of the effective date of of April 3, 2000: Prior to the accumulation perform a one-time eddy current inspection this AD: Do a detailed inspection of the of 12,000 total flight cycles, or within 1 to detect cracks of the rivet holes located on fastener holes at the hinge fitting of the cargo month after April 3, 2000, whichever occurs the left and right sides of external stringer 4 compartment doors to determine if the holes later, perform an eddy current inspection to at frames 24 and 28 of the fuselage, in are oversized, and inspect the outer skin detect cracks in the plug door stop fittings of accordance with Avions de Transport around the fastener holes for cracking, in the forward and aft passenger and service Regional Service Bulletin ATR72–53–1014, doors, in accordance with Avions de Revision 2, dated October 15, 1992. accordance with the Accomplishment Transport Regional Service Bulletin ATR72– (1) If no crack is detected during the Instructions of Avions de Transport Regional 52–1028, dated July 5, 1993. inspection required by paragraph (g) of this Service Bulletin ATR72–52–1018, Revision 1, (1) If no crack is detected, repeat the eddy AD, prior to further flight, install dated March 13, 2001. current inspection required by paragraph (d) reinforcement angles on the left and right Note 2: For the purposes of this AD, a of this AD thereafter at intervals not to sides of external stringer 4 at frames 24 and detailed inspection is defined as: ‘‘An 28 of the fuselage, in accordance with the exceed 6,000 flight cycles. intensive visual examination of a specific (2) If any crack is detected, prior to further service bulletin. structural area, system, installation, or flight, replace the cracked stop fittings with (2) If any crack is detected during the new, improved fittings, in accordance with inspection required by paragraph (g) of this assembly to detect damage, failure, or Avions de Transport Regional Service AD, prior to further flight, repair in irregularity. Available lighting is normally Bulletin ATR72–52–1033, dated April 28, accordance with a method approved by the supplemented with a direct source of good 1995, or ATR72–52–1029, Revision 1, dated Manager, International Branch, ANM–116; or lighting at intensity deemed appropriate by November 16, 1994; as applicable. the DGAC (or its delegated agent). the inspector. Inspection aids such as mirror, Accomplishment of the replacement (h) For airplanes on which Aerospatiale magnifying lenses, etc., may be used. Surface constitutes terminating action for the Modification 03185 (reference Avions de cleaning and elaborate access procedures repetitive inspection requirements of Transport Regional Service Bulletin ATR72– may be required.’’ paragraph (d)(1) of this AD for that fitting. 53–1020, dated October 6, 1992) has not been (j) Prior to further flight, repair any (e) For airplanes on which Aerospatiale accomplished as of April 3, 2000: Prior to the Modification 03775 or Aerospatiale accumulation of 12,000 total flight cycles, or discrepancies detected during any inspection Modification 03776 has not been within 1 month after April 3, 2000, required by paragraph (i) of this AD in accomplished as of April 3, 2000: Prior to the whichever occurs later, perform a one-time accordance with the Accomplishment accumulation of 18,000 total flight cycles, or eddy current inspection to detect cracks of Instructions of Avions de Transport Regional within 1 month after April 3, 2000, the rivet holes located on stringer 11 of frame Service Bulletin ATR72–52–1018, Revision 1, whichever occurs later, replace the plug door 26 of the fuselage, in accordance with Avions dated March 13, 2001. Where the service stop fittings of the forward and aft passenger de Transport Regional Service Bulletin bulletin specifies contacting the ATR72–53–1020, dated October 6, 1992. and service doors with new, improved manufacturer for repair disposition, prior to fittings, in accordance with Avions de (1) If no crack is detected during the inspection required by paragraph (h) of this further flight, repair in accordance with a Transport Regional Service Bulletin ATR72– method approved by the Manager, 52–1033, dated April 28, 1995; or ATR72– AD, prior to further flight, install doublers International Branch, ANM–116; or the 52–1029, Revision 1, dated November 16, and stringer clips on the left and right sides 1994; as applicable. Accomplishment of the on stringer 11 of frame 26 of the fuselage, in DGAC (or its delegated agent). accordance with the service bulletin. replacement constitutes terminating action Alternative Methods of Compliance for the repetitive inspection requirements of (2) If any crack is detected during the paragraph (d)(1) of this AD. inspection required by paragraph (h) of this (k) In accordance with 14 CFR 39.19, the (f) For airplanes on which Aerospatiale AD, prior to further flight, repair in Manager, International Branch, ANM–116, is Modification 02986 (reference Avions de accordance with a method approved by the authorized to approve alternative methods of Transport Regional Service Bulletin ATR72– Manager, International Branch, ANM–116; or compliance for this AD. the DGAC (or its delegated agent). 53–1021, Revision 1, dated February 20, Note 3: The subject of this AD is addressed 1995) has not been accomplished as of April Note 1: Inspections and repairs in French airworthiness directive 2001–142– accomplished prior to the effective date of 3, 2000: Prior to the accumulation of 18,000 056(B), dated April 18, 2001. total flight cycles, or within 1 month after this AD in accordance with Avions de April 3, 2000, whichever occurs later, Transport Regional Service Bulletins ATR72– Issued in Renton, Washington, on perform a one-time eddy current inspection 53–1013, dated , 1991, or Revision 1, November 21, 2003. to detect cracks in the rivet holes of the door dated , 1992; ATR72–53–1019, dated surround corners of the forward and aft , 1993, or Revision 1, dated November Kalene C. Yanamura, passenger and service doors, in accordance 11, 1994; ATR72–52–1029, dated , Acting Manager, Transport Airplane with Avions de Transport Regional Service 1994; or ATR72–53–1014, Revision 1, dated Directorate, Aircraft Certification Service. Bulletin ATR72–53–1021, Revision 1, dated , 1992; are considered acceptable for [FR Doc. 03–29701 Filed 11–26–03; 8:45 am] February 20, 1995. compliance with the applicable actions BILLING CODE 4910–13–P (1) If no crack is detected during the specified in this AD. inspection required by paragraph (f) of this AD, prior to further flight, modify the rivet New Requirements of This AD holes, and replace the door surround corners (i) Prior to the accumulation of 27,000 total with modified corners, in accordance with flight cycles, or within 30 days after the the service bulletin. effective date of this AD, whichever is later; (2) If any crack is detected during the do the actions specified in paragraph (i)(1) or inspection required by paragraph (f) of this (i)(2) of this AD, as applicable.

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00014 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66776 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

DEPARTMENT OF THE TREASURY 3870;’’ is corrected to read ‘‘Milton SUPPLEMENTARY INFORMATION: This is a Cahn at (202) 622–3860;’’. synopsis of the Second Further Notice Internal Revenue Service of Proposed Rulemaking portion of the Cynthia E. Grigsby, Commission’s Second Report and Order 26 CFR Part 1 Acting Chief, Publication and Regulations and Second Further Notice of Proposed Branch, Legal Processing Division, Associate Rulemaking (‘‘Second FNPRM’’), FCC Chief Counsel, (Procedure and [REG–106486–98 and INTL–0015–91] Administration). 03–225, adopted September 10, 2003; released October 9, 2003. The full text [FR Doc. 03–29728 Filed 11–26–03; 8:45 am] RIN 1545–AW33 and RIN 1545–PP78 of the Commission’s Second FNPRM is BILLING CODE 4830–01–P available for inspection and copying Guidance Regarding the Treatment of during normal business hours in the Certain Contingent Payment Debt FCC Reference Center (Room CY–A257) Instruments With One or More FEDERAL COMMUNICATIONS at its headquarters, 445 12th Street, SW, Payments That Are Denominated in, or COMMISSION Washington, DC 20554, or may be Determined by Reference to, a purchased from the Commission’s copy Nonfunctional Currency; Correction 47 CFR Parts 15 and 76 contractor, Qualex International, (202) 863–2893, Portals II, Room CY–B402, AGENCY: Internal Revenue Service (IRS), [CS Docket No. 97–80; PP Docket No. 00– 445 12th St., SW, Washington, DC Treasury. 67; FCC 03–225] 20554, or may be reviewed via Internet at http://www.fcc.gov/mb. ACTION: Correction to notice of proposed Commercial Availability of Navigation rulemaking; notice of public hearing; Devices and Compatibility Between Synopsis of the Second Further Notice and withdrawal of previous proposed Cable Systems and Consumer of Proposed Rulemaking regulations section. Electronics Equipment 1. Although the Commission believes that its adoption of the technical, AGENCY: Federal Communications SUMMARY: This document contains labeling and encoding rules set forth Commission. corrections to proposed regulations herein will further the digital transition (Reg–106486–98; INTL–0015–91) that ACTION: Notice of proposed rulemaking. and facilitate the wider availability of were published in the Federal Register digital cable services to consumers, SUMMARY: In this document, the on , 2003 (68 FR 51944) further comment is needed on several Commission seeks comment on the regarding the treatment of contingent issues. As an initial matter, we seek mechanisms and standards by which payment debt instruments for which comment on whether the transmission new connectors and associated content one or more payments are denominated standards applicable to digital cable protection technologies can be approved in, or determined by reference to, a systems with an activated channel for use with unidirectional digital cable currency other than the taxpayer’s capacity of 750 MHz or greater should products. The Second Further Notice of functional currency. be extended to digital cable systems Proposed Rulemaking also seeks FOR FURTHER INFORMATION CONTACT: with an activated channel capacity of comment on: the potential extension of 550 MHz or greater. In particular, we Milton Cahn at (202) 622–3860 (not a digital cable system transmission toll free number). seek comment on the potential cost requirements to digital cable systems impact on such cable systems and SUPPLEMENTARY INFORMATION: with an activated channel capacity of whether waivers or other relief Background 550 MHz or higher; whether it is mechanisms are appropriate for cable necessary to require consumer systems that might experience economic The proposed regulations that are the electronics manufacturers to provide hardship as a result of these obligations. subject of these corrections are under pre-sale information to consumers 2. With respect to the issue of Section 1275 of the Internal Revenue regarding the functionalities of consumer information disclosures, we Code. unidirectional digital cable televisions; seek comment on whether the and whether the Commission should Need for Correction Commission should require consumer ban or permit the down-resolution of electronics manufacturers to provide As published, the notice of proposed non-broadcast MVPD programming. consumers with pre-sale information rulemaking; notice of public hearing; Potential Commission action in these regarding the functionalities of and withdrawal of previous proposed areas is intended to further the unidirectional digital cable televisions. regulations (REG–106486–98; INTL– commercial availability of For example, we seek comment on 0015–91), contains errors that may unidirectional digital cable products whether it is appropriate to require prove to be misleading and are in need and other navigation devices pursuant consumer electronics manufacturers to of clarification. to section 629 of the Communications inform potential purchasers of Act. Correction of Publication unidirectional digital cable televisions DATES: Comments due , 2004; of: (1) The need to use a set-top box in Accordingly, the publication of the reply comments are due , order to receive interactive services, (2) notice of proposed rulemaking, notice of 2004. the necessity to obtain a POD from their public hearing; and withdrawal of cable operator, or (3) any other relevant previous proposed regulations (REG– ADDRESSES: Federal Communications information disclosing the 106486–98; INTL–0015–91), which was Commission, 445 12th Street, SW, functionalities or limitations of these the subject of FR Doc. 03–21827, is Washington, DC 20554. For further devices. If so, we seek comment on the corrected as follows: filing information, see SUPPLEMENTARY appropriate mechanism to communicate On page 51944, column 2, in the INFORMATION. this information to consumers, preamble under the subject heading FOR FOR FURTHER INFORMATION CONTACT: including but not limited to point of FURTHER INFORMATION CONTACT, line 2, Susan Mort, 202–418–1043 or sale marketing materials to be provided the language ‘‘Milton Cahn at (202) 622– [email protected]. to retailers, more informative labeling

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00015 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66777

on device packaging, the use of Internet whether objective criteria should be Further Notice (computer diskettes, web sites, or any other appropriate used to evaluate new connectors and large print, audio recording and Braille) format designed to reach consumers content protection technologies and, if are available to persons with disabilities before they make purchasing decisions. so, what specific criteria should be by contacting Brian Millin, of the 3. Another area in which we seek used. For example, Microsoft Consumer & Governmental Affairs additional comment relates to the down- Corporation and Hewlett Packard Bureau, at (202) 418–7426, TTY (202) resolution of non-broadcast MVPD Corporation have submitted a detailed 418–7365, or at [email protected]. programming. As discussed above, proposal suggesting functional 11. Comment Information. Pursuant content providers assert that down- requirements that could be used to to sections 1.415 and 1.419 of the resolution is a necessary tool to incite evaluate digital rights management Commission’s rules, 47 CFR 1.415, the retirement of component analog technologies for use with digital cable 1.419, interested parties may file outputs. Despite this assertion, the cable ready products. We seek comment on comments on or before January 14, and consumer electronics industries this proposal, as well as other proposals 2004, and reply comments on or before have been unable to reach agreement on relying on objective criteria, and any February 13, 2004. Comments may be whether down-resolution was an new proposals that commenters may filed using the Commission’s Electronic appropriate content protection tool. We submit to the Commission. Comment Filing System (ECFS) or by seek comment on whether the 6. We also seek comment on whether filing paper copies. See Electronic Filing Commission should prohibit the CableLabs is the appropriate entity to of Documents in Rulemaking activation by MVPDs of down- make initial approval determinations, or Proceedings, 63 FR 24121 (1998). resolution for non-broadcast MVPD whether another entity should have 12. Comments filed through the ECFS programming content. If so, we seek decision-making authority. In particular, can be sent as an electronic file via the comment on the potential impact of we seek comment on whether the Internet to http://www.fcc.gov/e-file/ such a ban on the availability of high Commission, a qualified third party, or ecfs.html. Generally, only one copy of value digital content to consumers. In an independent entity representing an electronic submission must be filed. the alternative, if the Commission were various industry and consumer interests If multiple docket or rulemaking to permit the use of down-resolution in should make approval determinations. numbers appear in the caption of this this manner, we seek comment on the 7. As to the issue of how approved proceeding, however, commenters must potential impact on consumers with connectors or content protection transmit one electronic copy of the DTV equipment that only has technologies may be revoked should comments to each docket or rulemaking component analog outputs. In their security be compromised, we seek number referenced in the caption. In particular, we seek comment on the comment on the appropriate standard completing the transmittal screen, number of consumers that might be for revocation. Specifically, we seek commenters should include their full affected and on the number of sets to be comment on whether revocation is name, U.S. Postal Service mailing produced in the future with only analog appropriate where a connector or address, and the applicable docket or outputs. Finally, we seek comment on content protection technology is rulemaking number. Parties may also the potential impact of down-resolution perceived to be insecure, or whether the submit an electronic comment by upon consumers who own DTV appropriate standard is where security Internet e-mail. To get filing instructions equipment with both digital and analog has been compromised in a significant, for e-mail comments, commenters outputs. widespread manner. Once a connector should send an e-mail to [email protected], 4. As discussed above, we are or content protection technology has and should include the following words concerned that because CableLabs is not been revoked, we seek comment on the in the body of the message, ‘‘get form a standards-setting body, its proposed appropriate mechanism by which .’’ A sample form role as the sole initial arbiter of outputs revocation should be effectuated. For and directions will be sent in reply. and associated content protection example, should revoked connectors or Parties who choose to file by paper must technologies to be used in content protection technologies be file an original and four copies of each unidirectional digital cable products eliminated on a going-forward basis, filing. If more than one docket or could affect innovation and while preserving their functionality for rulemaking number appear in the interoperability. This Second Further existing devices? We also seek comment caption of this proceeding, commenters Notice seeks comment on whether on whether there are technological or must submit two additional copies for standards and procedures should be other means of revoking connectors or each additional docket or rulemaking adopted for the approval of new content protection technologies while number. Filings can be sent by hand or connectors or content protection preserving the functionality of messenger delivery, by commercial technologies to be used with consumer electronics devices. overnight courier, or by first-class or unidirectional digital cable televisions 8. Authority. This Second FNPRM is overnight U.S. Postal Service mail and products. If so, we seek comment issued pursuant to authority contained (although we continue to experience on whether these standards and in sections 1, 4(i) and (j), 303, 403, 601, delays in receiving U.S. Postal Service procedures should encompass other 624A and 629 of the Communications mail). The Commission’s contractor, related consumer electronics Act of 1934, as amended. Natek, Inc., will receive hand-delivered equipment, including non-cable 9. Ex Parte Rules—Non-Restricted or messenger-delivered paper filings for compatible DTV receivers. We also seek Proceeding. This is a non-restricted the Commission’s Secretary at 236 comment on the various types of notice and comment rulemaking Massachusetts Avenue, NE., Suite 110, content protection technologies that proceeding. Ex parte presentations are Washington, DC 20002. The filing hours should be considered as a part of this permitted, except during the Sunshine at this location are 8 a.m. to 7 p.m. All process, including but not limited to Agenda period, provided that they are hand deliveries must be held together digital rights management, wireless and disclosed as provided in the with rubber bands or fasteners. Any encryption-based technologies. Commission’s Rules. See generally 47 envelopes must be disposed of before 5. With respect to the particular CFR 1.1202, 1.1203, and 1.1206(a). entering the building. Commercial standards and procedures to be 10. Accessibility Information. overnight mail (other than U.S. Postal employed, we seek comment on Accessible formats of this Second Service Express Mail and Priority Mail)

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66778 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

must be sent to 9300 East Hampton rules which will set a one-way and (3) satisfies any additional criteria Drive, Capitol Heights, MD 20743. U.S. specification for digital cable ‘‘plug and established by the Small Business Postal Service first-class mail, Express play’’ compatibility for DTV equipment. Administration (‘‘SBA’’). Mail, and Priority Mail should be The negotiations between the consumer 19. Television Broadcasting. The addressed to 445 12th Street, SW, electronics and cable television Small Business Administration defines Washington, DC 20554. All filings must industries which led to the agreement a television broadcasting station that has be addressed to the Commission’s underlying these rules call for the cable no more than $12 million in annual Secretary, Office of the Secretary, television industry to make initial receipts as a small business. Business Federal Communications Commission. determinations about which new device concerns included in this industry are 13. Regulatory Flexibility Act. As connectors and associated content those ‘‘primarily engaged in required by the Regulatory Flexibility protection technologies may be used in broadcasting images together with Act, the Commission has prepared an connection with unidirectional digital sound.’’ According to Commission staff Initial Regulatory Flexibility Analysis cable products produced under this review of the BIA Publications, Inc. (‘‘IRFA’’) of the possible significant specification. Commenters have Master Access Television Analyzer economic impact on a substantial indicated that the cable industry should Database as of May 16, 2003, about 814 number of small entities of the not be the sole arbiter of such decisions, of the 1,220 commercial television proposals addressed in this Second however, the record currently before the stations in the United States have FNPRM. The IRFA is set forth below. Commission is insufficient on this revenues of $12 million or less. We Written public comments are requested matter. In order to ensure the note, however, that, in assessing on the IRFA. These comments must be connectivity and interoperability of whether a business concern qualifies as filed in accordance with the same filing unidirectional digital cable products, small under the above definition, deadlines for comments on the Second and to fulfill the Commission’s business (control) affiliations must be FNPRM, and they should have a commercial availability mandate under included. Our estimate, therefore, likely separate and distinct heading section 629, we are initiating the Second overstates the number of small entities designating them as responses to the FNPRM to seek comment on the that might be affected by our action, IRFA. mechanisms and standards by which because the revenue figure on which it 14. The Commission’s Consumer and new connectors and associated content is based does not include or aggregate Governmental Affairs Bureau, Reference protection technologies can be approved revenues from affiliated companies. Information Center, shall send a copy of for use in this context. The Second There are also 2,127 low power this Second FNPRM, including the FNPRM also seeks comment on: (1) The television stations (LPTV). Given the Initial Regulatory Flexibility Analysis, potential extension of the transmission nature of this service, we will presume to the Chief Counsel for Advocacy of the requirements applicable to digital cable that all LPTV licensees qualify as small Small Business Administration. systems with an activated channel entities under the SBA definition. 20. In addition, an element of the Initial Regulatory Flexibility Analysis capacity of 750 MHz or higher to digital cable systems with an activated channel definition of ‘‘small business’’ is that the 15. As required by the Regulatory capacity of 550 MHz or higher; (2) entity not be dominant in its field of Flexibility Act of 1980, as amended whether it is necessary to require operation. We are unable at this time to (‘‘RFA’’) the Commission has prepared consumer electronics manufacturers to define or quantify the criteria that this present Initial Regulatory provide pre-sale information to would establish whether a specific Flexibility Analysis (‘‘IRFA’’) of the consumers regarding the functionalities television station is dominant in its field possible significant economic impact on of unidirectional digital cable of operation. Accordingly, the estimate a substantial number of small entities by televisions; and (3) whether the of small businesses to which rules may the policies and rules proposed in the Commission should ban or permit the apply do not exclude any television Second FNPRM portion of this item. down-resolution of non-broadcast station from the definition of a small Written public comments are requested MVPD programming. business on this basis and are therefore on this IRFA. Comments must be 17. Legal Basis. The authority for this over-inclusive to that extent. Also as identified as responses to the IRFA and proposed rulemaking is contained in noted, an additional element of the must be filed by the deadlines for sections 1, 4(i) and (j), 303, 403, 601, definition of ‘‘small business’’ is that the comments on the Second FNPRM 624A and 629 of the Communications entity must be independently owned portion of this item provided above. The Act of 1934, 47 U.S.C 151, 154(i) and (j), and operated. We note that it is difficult Commission will send a copy of this 303, 403, 521, 544a and 549. at times to assess these criteria in the entire Second Order and Second Further 18. Description and Estimate of the context of media entities and our Notice of Proposed Rulemaking, Number of Small Entities to Which the estimates of small businesses to which including this IRFA, to the Chief Proposed Rules Will Apply. The RFA they apply may be over-inclusive to this Counsel for Advocacy of the Small directs the Commission to provide a extent. Business Administration (‘‘SBA’’). In description of and, where feasible, an 21. Cable and Other Program addition, the Second FNPRM portion of estimate of the number of small entities Distribution. The SBA has developed a this item and the IRFA (or summaries that will be affected by the proposed small business size standard for cable thereof) will be published in the Federal rules. The RFA generally defines the and other program distribution services, Register. term ‘‘small entity’’ as encompassing the which includes all such companies 16. Need for, and Objectives of, the terms ‘‘small business,’’ ‘‘small generating $12.5 million or less in Proposed Rules. In connection with the organization,’’ and ‘‘small governmental revenue annually. This category Commission’s efforts to ensure the entity.’’ In addition, the term ‘‘small includes, among others, cable operators, commercial availability of navigation Business’’ has the same meaning as the direct broadcast satellite (‘‘DBS’’) devices pursuant to section 629 of the term ‘‘small business concern’’ under services, home satellite dish (‘‘HSD’’) Communication’s Act, the Second the Small Business Act. A small services, multipoint distribution Report and Order part of the Second business concern is one which: (1) Is services (‘‘MDS’’), multichannel Report and Order and Second FNPRM independently owned and operated; (2) multipoint distribution service adopts technical, labeling and encoding is not dominant in its field of operation; (‘‘MMDS’’), Instructional Television

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66779

Fixed Service (‘‘ITFS’’), local multipoint entity is one with $12.5 million or less frequencies of the MDS and ITFS. LMDS distribution service (‘‘LMDS’’), satellite in annual receipts. There are four is a fixed broadband point-to-multipoint master antenna television (‘‘SMATV’’) licensees of DBS services under part 100 microwave service that provides for systems, and open video systems of the Commission’s rules. Three of two-way video telecommunications. (‘‘OVS’’). According to the Census those licensees are currently 27. In connection with the 1996 MDS Bureau data, there are 1,311 total cable operational. Two of the licensees that auction, the Commission defined small and other pay television service firms are operational have annual revenues businesses as entities that had annual that operate throughout the year of that may be in excess of the threshold average gross revenues of less than $40 which 1,180 have less than $10 million for a small business. The Commission, million in the previous three calendar in revenue. We address below each however, does not collect annual years. This definition of a small entity service individually to provide a more revenue data for DBS and, therefore, is in the context of MDS auctions has been precise estimate of small entities. unable to ascertain the number of small approved by the SBA. The MDS 22. Cable Operators. The Commission DBS licensees that could be impacted by auctions resulted in 67 successful has developed, with SBA’s approval, these proposed rules. DBS service bidders obtaining licensing our own definition of a small cable requires a great investment of capital for opportunities for 493 Basic Trading system operator for the purposes of rate operation, and we acknowledge, despite Areas (‘‘BTAs’’). Of the 67 auction regulation. Under the Commission’s the absence of specific data on this winners, 61 met the definition of a small rules, a ‘‘small cable company’’ is one point, that there are entrants in this field business. MDS also includes licensees serving fewer than 400,000 subscribers that may not yet have generated $12.5 of stations authorized prior to the nationwide. We last estimated that there million in annual receipts, and therefore auction. As noted, the SBA has were 1,439 cable operators that qualified may be categorized as a small business, developed a definition of small entities as small cable companies. Since then, if independently owned and operated. for pay television services, which some of those companies may have 25. Home Satellite Dish (‘‘HSD’’) includes all such companies generating grown to serve over 400,000 subscribers, Service. Because HSD provides $12.5 million or less in annual receipts. and others may have been involved in subscription services, HSD falls within This definition includes multipoint transactions that caused them to be the SBA-recognized definition of cable distribution services, and thus applies combined with other cable operators. and other program distribution services. to MDS licensees and wireless cable Consequently, we estimate that there are This definition provides that a small operators that did not participate in the fewer than 1,439 small entity cable entity is one with $12.5 million or less MDS auction. Information available to system operators that may be affected by in annual receipts. The market for HSD us indicates that there are the decisions and rules proposed in this service is difficult to quantify. Indeed, approximately 850 of these licensees Second FNPRM. the service itself bears little resemblance and operators that do not generate 23. The Communications Act, as to other MVPDs. HSD owners have revenue in excess of $12.5 million amended, also contains a size standard access to more than 265 channels of annually. Therefore, for purposes of the for a small cable system operator, which programming placed on C-band IRFA, we find there are approximately is ‘‘a cable operator that, directly or satellites by programmers for receipt 850 small MDS providers as defined by through an affiliate, serves in the and distribution by MVPDs, of which the SBA and the Commission’s auction aggregate fewer than 1% of all 115 channels are scrambled and rules. subscribers in the United States and is approximately 150 are unscrambled. 28. The SBA definition of small not affiliated with any entity or entities HSD owners can watch unscrambled entities for cable and other program whose gross annual revenues in the channels without paying a subscription distribution services, which includes aggregate exceed $250,000,000.’’ The fee. To receive scrambled channels, such companies generating $12.5 Commission has determined that there however, an HSD owner must purchase million in annual receipts, seems are 68,500,000 subscribers in the United an integrated receiver-decoder from an reasonably applicable to ITFS. There are States. Therefore, an operator serving equipment dealer and pay a presently 2,032 ITFS licensees. All but fewer than 685,000 subscribers shall be subscription fee to an HSD 100 of these licenses are held by deemed a small operator if its annual programming package. Thus, HSD users educational institutions. Educational revenues, when combined with the total include: (1) Viewers who subscribe to a institutions are included in the annual revenues of all of its affiliates, do packaged programming service, which definition of a small business. However, not exceed $250 million in the affords them access to most of the same we do not collect annual revenue data aggregate. Based on available data, we programming provided to subscribers of for ITFS licensees, and are not able to find that the number of cable operators other MVPDs; (2) viewers who receive ascertain how many of the 100 non- serving 685,000 subscribers or less totals only non-subscription programming; educational licensees would be approximately 1,450. Although it seems and (3) viewers who receive satellite categorized as small under the SBA certain that some of these cable system programming services illegally without definition. Thus, we tentatively operators are affiliated with entities subscribing. Because scrambled conclude that at least 1,932 licensees are whose gross annual revenues exceed packages of programming are most small businesses. $250,000,000, we are unable at this time specifically intended for retail 29. Additionally, the auction of the to estimate with greater precision the consumers, these are the services most 1,030 LMDS licenses began on February number of cable system operators that relevant to this discussion. 18, 1998, and closed on March 25, 1998. would qualify as small cable operators 26. Multipoint Distribution Service The Commission defined ‘‘small entity’’ under the definition in the (‘‘MDS’’), Multichannel Multipoint for LMDS licenses as an entity that has Communications Act. Distribution Service (‘‘MMDS’’) average gross revenues of less than $40 24. Direct Broadcast Satellite (‘‘DBS’’) Instructional Television Fixed Service million in the three previous calendar Service. Because DBS provides (‘‘ITFS’’) and Local Multipoint years. An additional classification for subscription services, DBS falls within Distribution Service (‘‘LMDS’’). MMDS ‘‘very small business’’ was added and is the SBA-recognized definition of cable systems, often referred to as ‘‘wireless defined as an entity that, together with and other program distribution services. cable,’’ transmit video programming to its affiliates, has average gross revenues This definition provides that a small subscribers using the microwave of not more than $15 million for the

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00018 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66780 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

preceding calendar years. These Residential Communications Network, fewer employees in order to qualify as regulations defining ‘‘small entity’’ in Inc. (‘‘RCN’’) received approval to a small business concern. Census the context of LMDS auctions have been operate OVS systems in New York City, Bureau data indicates that there 1,215 approved by the SBA. There were 93 Boston, Washington, DC and other U.S. establishments that manufacture winning bidders that qualified as small areas. RCN has sufficient revenues to radio and television broadcasting and entities in the LMDS auctions. A total of assure us that they do not qualify as wireless communications equipment, 93 small and very small business small business entities. Little financial and that 1,150 of these establishments bidders won approximately 277 A Block information is available for the other have fewer than 500 employees and licenses and 387 B Block licenses. On entities authorized to provide OVS that would be classified as small entities. March 27, 1999, the Commission re- are not yet operational. Given that other The remaining 65 establishments have auctioned 161 licenses; there were 40 entities have been authorized to provide 500 or more employees; however, we winning bidders. Based on this OVS service but have not yet begun to are unable to determine how many of information, we conclude that the generate revenues, we conclude that at those have fewer than 750 employees number of small LMDS licenses will least some of the OVS operators qualify and therefore, also qualify as small include the 93 winning bidders in the as small entities. entities under the SBA definition. We first auction and the 40 winning bidders 33. Electronics Equipment therefore conclude that there are no in the re-auction, for a total of 133 small Manufacturers. Rules adopted in this more than 542 small manufacturers of entity LMDS providers as defined by the proceeding could apply to audio and visual electronics equipment SBA and the Commission’s auction manufacturers of DTV receiving and no more than 1,150 small rules. equipment and other types of consumer manufacturers of radio and television 30. In sum, there are approximately a electronics equipment. The SBA has broadcasting and wireless total of 2,000 MDS/MMDS/LMDS developed definitions of small entity for communications equipment for stations currently licensed. Of the manufacturers of audio and video consumer/household use. approximate total of 2,000 stations, we 34. Computer Manufacturers. The equipment as well as radio and estimate that there are 1,595 MDS/ Commission has not developed a television broadcasting and wireless MMDS/LMDS providers that are small definition of small entities applicable to communications equipment. These businesses as deemed by the SBA and computer manufacturers. Therefore, we categories both include all such the Commission’s auction rules. will utilize the SBA definition of 31. Satellite Master Antenna companies employing 750 or fewer electronic computers manufacturing. Television (‘‘SMATV’’) Systems. The employees. The Commission has not According to SBA regulations, a SBA definition of small entities for developed a definition of small entities computer manufacturer must have 1,000 cable and other program distribution applicable to manufacturers of or fewer employees in order to qualify services includes SMATV services and, electronic equipment used by as a small entity. Census Bureau data thus, small entities are defined as all consumers, as compared to industrial indicates that there are 563 firms that such companies generating $12.5 use by television licensees and related manufacture electronic computers and million or less in annual receipts. businesses. Therefore, we will utilize of those, 544 have fewer than 1,000 Industry sources estimate that the SBA definitions applicable to employees and qualify as small entities. approximately 5,200 SMATV operators manufacturers of audio and visual The remaining 19 firms have 1,000 or were providing service as of December equipment and radio and television more employees. We conclude that 1995. Other estimates indicate that broadcasting and wireless there are approximately 544 small SMATV operators serve approximately communications equipment, since these computer manufacturers. 1.5 million residential subscribers as of are the two closest NAICS Codes 35. Description of Projected July 2001. The best available estimates applicable to the consumer electronics Reporting, Recordkeeping and other indicate that the largest SMATV equipment manufacturing industry. Compliance Requirements. At this time, operators serve between 15,000 and However, these NAICS categories are we do not expect that the proposed 55,000 subscribers each. Most SMATV broad and specific figures are not rules would impose any additional operators serve approximately 3,000– available as to how many of these reporting or recordkeeping 4,000 customers. Because these establishments manufacture consumer requirements. However, compliance operators are not rate regulated, they are equipment. According to the SBA’s with the rules, if they are adopted, may not required to file financial data with regulations, an audio and visual require consumer electronics the Commission. Furthermore, we are equipment manufacturer must have 750 manufacturers to seek approval for new not aware of any privately published or fewer employees in order to qualify device connectors and associated financial information regarding these as a small business concern. Census content protection technologies to be operators. Based on the estimated Bureau data indicates that there are 554 used in conjunction with unidirectional number of operators and the estimated U.S. establishments that manufacture digital cable products. These number of units served by the largest audio and visual equipment, and that requirements could have an impact on ten SMATVs, we believe that a 542 of these establishments have fewer consumer electronics manufacturers, substantial number of SMATV operators than 500 employees and would be including small entities. We seek qualify as small entities. classified as small entities. The comment on the possible burden these 32. Open Video Systems (‘‘OVS’’). remaining 12 establishments have 500 requirements would place on small Because OVS operators provide or more employees; however, we are entities. Also, we seek comment on subscription services, OVS falls within unable to determine how many of those whether a special approach toward any the SBA-recognized definition of cable have fewer than 750 employees and possible compliance burdens on small and other program distribution services. therefore, also qualify as small entities entities might be appropriate. This definition provides that a small under the SBA definition. Under the 36. Steps Taken to Minimize entity is one with $ 12.5 million or less SBA’s regulations, a radio and television Significant Impact on Small Entities, in annual receipts. The Commission has broadcasting and wireless and Significant Alternatives Considered. certified 25 OVS operators with some communications equipment The RFA requires an agency to describe now providing service. Affiliates of manufacturer must also have 750 or any significant alternatives that it has

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00019 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66781

considered in reaching its proposed possible small entity-related Inc., licensee of station KFXP–TV, approach, which may include the alternatives. NTSC channel 31–, proposing the following four alternatives (among 41. Federal Rules Which Duplicate, allotment of DTV channel 38 at others): (1) The establishment of Overlap, or Conflict with the Pocatello. DTV Channel 38 can be differing compliance or reporting Commission’s Proposals. None. allotted to Pocatello, Idaho, at reference requirements or timetables that take into Federal Communications Commission. coordinates 42–55–15 N. and 112–20–44 account the resources available to small Marlene H. Dortch, W. entities; (2) the clarification, Secretary. DATES: Comments must be filed on or consolidation, or simplification of [FR Doc. 03–29521 Filed 11–26–03; 8:45 am] before , 2004, and reply compliance or reporting requirements comments on or before , BILLING CODE 6712–01–P under the rule for small entities; (3) the 2004. use of performance, rather than design, standards; and (4) an exemption from ADDRESSES: The Commission permits FEDERAL COMMUNICATIONS coverage of the rule, or any part thereof, the electronic filing of all pleadings and COMMISSION for small entities. comments in proceeding involving petitions for rule making (except in 37. As indicated above, the Second 47 CFR Part 73 FNPRM seeks comment on whether the broadcast allotment proceedings). See Commission should adopt rules [DA 03–2930, MB Docket No. 03–210, RM– Electronic Filing of Documents in Rule establishing an approval mechanism for 10791] Making Proceedings, GC Docket No. 97– new connectors and associated content 113 (rel. , 1998). Filings by paper Digital Television Broadcast Service; protection technologies to be used with can be sent by hand or messenger Elmira, NY unidirectional digital cable products. delivery, by commercial overnight courier, or by first-class or overnight Consumer electronics manufacturers AGENCY: Federal Communications may be required to seek such approval U.S. Postal Service mail (although we Commission. continue to experience delays in prior to implementing new connectors ACTION: Proposed rule; correction. and associated content protection receiving U.S. Postal Service mail). The Commission’s contractor, Vistronix, technologies in unidirectional digital SUMMARY: The Federal Communications Inc., will receive hand-delivered or cable products. We welcome comment Commission published in the Federal messenger-delivered paper filings for on modifications of this proposal to Register of , 2003, (68 FR the Commission’s Secretary at 236 lessen any potential impact on small 57861), a document to change the DTV Massachusetts Avenue, NE., Suite 110, entities, while still remaining consistent Table of Allotments to reflect the Washington, DC 20002. The filing hours with our policy goals. substitution of DTV channel 33 for DTV at this location are 8 a.m. to 7 p.m. All 38. The Second FNPRM also seeks channel 2 at Elmira, New York. This hand deliveries must be held together comment on the potential applicablity document contained incorrect dates. with rubber bands or fasteners. of certain transmission standards for FOR FURTHER INFORMATION CONTACT: Pam Any envelopes must be disposed of digital cable systems to systems with an Blumenthal, Media Bureau, (202) 418– before entering the building. activated channel capacity of 550 MHz 1600. Commercial overnight mail (other than or greater. Since such cable systems are U.S. Postal Service Express Mail and often owned by small cable operators, Correction Priority Mail) must be sent to 9300 East we seek comment on the potential In the Federal Register of October 7, Hampton Drive, Capitol Heights, MD impact of this proposed rule upon small 2003, on page 57861, correct the reply 20743. U.S. Postal Service first-class cable operators and whether some relief comment date to read: , mail, Express Mail, and Priority Mail mechanism, such as waivers, would 2003. should be addressed to 445 12th Street, help alleviate any potential impact on Dated: November 20, 2003. SW., Washington, DC 20554. All filings small entities. Federal Communications Commission. must be addressed to the Commission’s 39. With respect to the proposed Barbara A. Kreisman, Secretary, Office of the Secretary, requirement for consumer electronics Chief, Video Division, Media Bureau. Federal Communications Commission, manufacturers to provide consumers Washington, DC 20554. In addition to with pre-sale information regarding the [FR Doc. 03–29627 Filed 11–26–03; 8:45 am] BILLING CODE 6712–01–P filing comments with the FCC, functionalities of unidirectional digital interested parties should serve the cable televisions, we seek comment on petitioner, or its counsel or consultant, how this might affect small FEDERAL COMMUNICATIONS as follows: Lee G. Petro, Fletcher, Heald manufacturers. We also seek comment COMMISSION & Hildreth, PLC, 11th Floor, 1300 North on whether the potential economic 17th Street, Arlington, Virginia 22209– burden on small entities might be 47 CFR Part 73 3801 (Counsel for Compass lessened, while still generally retaining Communications of Idaho, Inc. ). the requirement or the intended effect of [DA 03–3561, MB Docket No. 03–233, RM– the requirements. 10699] FOR FURTHER INFORMATION CONTACT: Pam 40. Finally, the Second FNPRM seeks Blumenthal, Media Bureau, (202) 418– Digital Television Broadcast Service; 1600. comment on whether to permit or ban Pocatello, ID the down-resolution by MVPDs of non- SUPPLEMENTARY INFORMATION: This is a broadcast MVPD programming. We AGENCY: Federal Communications synopsis of the Commission’s Notice of believe this requirement would largely Commission. Proposed Rule Making, MB Docket No. impact the DBS industry, which is ACTION: Proposed rule. 03–233, adopted , 2003, and primarily composed of large entities. To released November 14, 2003. The full the extent that small entities might be SUMMARY: The Commission requests text of this document is available for adversely affected by this potential comments on a petition filed by public inspection and copying during requirement, we welcome comments on Compass Communications of Idaho, regular business hours in the FCC

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00020 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66782 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

Reference Information Center, Portals II, SUMMARY: This document sets forth a 03–232, adopted , 2003 445 12th Street, SW., Room CY–A257, proposal to amend the FM Table of and released November 14, 2003. The Washington, DC 20554. This document Allotments, Section 73.202(b) of the full text of this Commission decision is may also be purchased from the Commission’s rules, 47 CFR 73.202(b). available for inspection and copying Commission’s duplicating contractor, The Commission requests comment on during normal business hours in the Qualex International, Portals II, 445 a petition filed by Joyner Radio, Inc., FCC Reference Information Center 12th Street, SW., Room CY–B402, licensee of Station WFXQ(FM), Chase (Room CY–A257), 445 12th Street, SW., Washington, DC 20554, telephone 202– City, Virginia. Petitioner proposes to Washington, DC. The complete text of 863–2893, facsimile 202–863–2898, or delete Channel 260C3 at Chase City, this decision may also be purchased via-e-mail [email protected]. Virginia to allot Channel 260C3 at from the Commission’s copy contractor, Provisions of the Regulatory Creedmoor, North Carolina, and to Qualex International, Portals II, 445 Flexibility Act of 1980 do not apply to modify the license of Station 12th Street, SW., Room CY–B402, this proceeding. WFXQ(FM) accordingly. In order to Washington, DC 20554, telephone (202) Members of the public should note facilitate the allotment of Channel 863–2893. that from the time a Notice of Proposed 260C3 at Creedmoor, petitioner Rule Making is issued until the matter proposes the substitution of Channel The Provisions of the Regulatory is no longer subject to Commission 257A for Channel 259A at Nashville, Flexibility Act of 1980 do not apply to consideration or court review, all ex North Carolina, and the modification of this proceeding. Members of the public parte contacts are prohibited in the license of Station WZAX(FM) should note that from the time a Notice Commission proceedings, such as this accordingly. Finally, in order to of Proposed Rule Making is issued until one, which involve channel allotments. accommodate the substitution of the matter is no longer subject to See 47 CFR 1.1204(b) for rules Channel 257A at Nashville, petitioner Commission consideration or court governing permissible ex parte contacts. requests the deletion of Channel 257A at review, all ex parte contacts are For information regarding proper Ahoskie, North Carolina, the addition of prohibited in Commission proceedings, filing procedures for comments, see 47 Channel 257A at Gatesville, North such as this one, which involve channel CFR 1.415 and 1.420. Carolina, and the modification of the allotments. See 47 CFR 1.1204(b) for List of Subjects in 47 CFR Part 73 license of FM Station WQDK rules governing permissible ex parte accordingly. Channel 260C3 can be contacts. Digital television broadcasting, allotted at Creedmoor in compliance Television. with the Commission’s minimum For information regarding proper For the reasons discussed in the distance separation requirements with a filing procedures for comments, see 47 preamble, the Federal Communications site restriction of 16.3 km (10.1 miles) CFR 1.415 and 1.420. Commission proposes to amend 47 CFR east of Creedmoor. The coordinates for List of Subjects in 47 CFR Part 73 Part 73 as follows: Channel 260C3 at Creedmoor are 36– 06–56 North Latitude and 78–30–22 Radio, Radio broadcasting. PART 73—RADIO BROADCAST West Longitude. Channel 257A can be SERVICES allotted at Gatesville in compliance with For the reasons discussed in the preamble, the Federal Communications 1. The authority citation for part 73 the Commission’s minimum distance Commission proposes to amend 47 CFR continues to read as follows: separation requirements with a site restriction of 12.9 km (8.0 miles) south part 73 as follows: Authority: 47 U.S.C. 154, 303, 334 and 336. of Gatesville. The coordinates for PART 73—RADIO BROADCAST § 73.622 [Amended] Channel 257A at Gatesville are 36–17– SERVICES 2. Section 73.622(b), the Table of 02 North Latitude and 76–43–40 West Digital Television Allotments under Longitude. Channel 257A can be allotted at Nashville in compliance with 1. The authority citation for part 73 Idaho is amended by adding DTV continues to read as follows: channel 38 at Pocatello. the Commission’s minimum distance separation requirements at the current Authority: 47 U.S.C. 154, 303, 334 and 336. Federal Communications Commission. reference coordinates for Channel 259A. Barbara A. Kreisman, See Supplementary Information infra. § 73.202 [Amended] Chief, Video Division, Media Bureau. DATES: Comments must be filed on or 2. Section 73.202(b), the Table of FM [FR Doc. 03–29626 Filed 11–26–03; 8:45 am] before January 5, 2004, and reply Allotments under North Carolina, is BILLING CODE 6712–01–P comments on or before January 20, amended by removing Ahoskie, Channel 2004. 257A, by adding Creedmoor, Channel FEDERAL COMMUNICATIONS ADDRESSES: Federal Communications 260C3, by adding Gatesville, Channel COMMISSION Commission, Washington, DC 20554. In 257A, and by removing Channel 259A addition to filing comments with the and by adding Channel 257A at 47 CFR Part 73 FCC, interested parties should serve Nashville. [DA 03–3551; MB Docket No. 03–232, RM– counsel for the petitioner as follows: 3. Section 73.202(b), the Table of FM 10819] Gregg P. Skall, Peter Gutmann, Joan Allotments under Virginia, is amended Stewart, Womble Carlyle Sandridge & by removing Chase City, Channel Radio Broadcasting Services; Ahoskie, Rice, PLLC, 1401 Eye Street, NW.— 260C3. North Carolina and Chase City, Seventh Floor, Washington, DC 20005. Federal Communications Commission. Virginia, and Creedmoor, Gatesville, FOR FURTHER INFORMATION CONTACT: and Nashville, NC Deborah A. Dupont, Media Bureau (202) John A. Karousos, 418–7072. Assistant Chief, Audio Division, Media AGENCY: Federal Communications Bureau. Commission. SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission’s Notice of [FR Doc. 03–29628 Filed 11–26–03; 8:45 am] ACTION: Proposed rule. Proposed Rule Making, MB Docket No. BILLING CODE 6712–01–P

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00021 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66783

DEPARTMENT OF COMMERCE FMP) is implemented by regulations at as evaluated in the NED experiment, as 50 CFR part 635. a potential means of reducing sea turtle National Oceanic and Atmospheric bycatch. Administration Background On , 2001, NMFS released a Area Closures 50 CFR Part 635 Biological Opinion (BiOp) that found There are currently five distinct area that the continued operation of the closures intended to reduce bycatch in [I.D. 112403A] Atlantic pelagic longline fishery is the Atlantic pelagic longline fishery, likely to jeopardize the existence of only one of which, the Northeast Distant Atlantic Highly Migratory Species; Atlantic leatherback and loggerhead sea Statistical area, was specifically Supplemental Environmental Impact turtles. To avoid jeopardy, the intended to address sea turtle bycach. Statement (SEIS) for Sea Turtle Reasonable and Prudent Alternative Current area closures include: the Bycatch Mitigation in the Atlantic (RPA) in the BiOp included a closure of Northeast Distant Statistical Area, Pelagic Longline Fishery the Northeast Distant (NED) Statistical closed year-round; the Northeastern Area of the Atlantic Ocean and a United States, closed during the month AGENCY: National Marine Fisheries research program to develop or modify of June; the Charleston Bump, closed Service (NMFS), National Oceanic and fishing gear and techniques to reduce February through April; the East Florida Atmospheric Administration (NOAA), sea turtle interactions and the mortality Coast, closed year-round; and, the Commerce. associated with such interactions. DeSoto Canyon, closed year-round. ACTION: Notice of intent (NOI) to As a result of this RPA, NMFS closed NMFS may examine additional and or prepare an SEIS; request for comments. the NED (67 FR 45393, , 2002) and modifications to existing area closures undertook a 3-year (2000–2003) as a potential means of reducing sea SUMMARY: NMFS announces its intent to experiment in the NED intended to turtle bycatch. prepare an SEIS under the National identify fishing gear and technique Environmental Policy Act to assess the modifications that may reduce sea turtle Onboard Bycatch Mitigation potential effects on the human interactions. The experiment examined NMFS currently requires pelagic environment of proposed alternatives various hook and bait combinations longline vessels to possess and use a and actions under a proposed rule to (treatments). Preliminary data suggest variety of equipment to mitigate sea reduce sea turtle bycatch in the Atlantic the treatments examined may reduce sea turtle bycatch and bycatch mortality. pelagic longline fishery. The SEIS is turtle interactions by between 50 and 92 These include: turtle handling intended to address issues regarding percent, depending on species and procedures that must be posted in the allowable fishing gears and techniques treatment, and appear to have widely wheel house; line cutters; and dipnets. in the pelagic longline fishery; varying impacts, both positive and NMFS may consider additional gear possession and use of onboard negative, on target species. Among the possession and use requirements, such equipment to minimize sea turtle hook and bait combinations tested were: as dehooking equipment, or moving one bycatch and bycatch mortality; 18/0 offset circle hooks using squid as nautical mile after an interaction, as a modification of time and area closures; bait, 18/0 offset circle hooks using potential means of reducing sea turtle and minimum levels of observer mackerel as bait, 18/0 non-offset circle bycatch. coverage. NMFS is requesting comments hooks using squid as bait, and 9/0 J- on the above measures. hooks using mackeral as bait. NMFS is Observer Coverage DATES: Comments on this action must be currently evaluating data from the final The June 14, 2001, BiOp and received no later than 5 p.m., local time, year of the experiment and will analyze Recommendations from the on December 29, 2003. that data as appropriate. International Commission for the ADDRESSES: Written comments on this Based on preliminary data and a Conservation of Atlantic Tunas both action should be mailed to Christopher review of the current status of the require a minimum of five-percent Rogers, Chief, Highly Migratory Species species, NMFS is considering observer coverage in the Atlantic pelagic Management Division, National Marine implementing various management longline fishery. NMFS may examine Fisheries Service, 1315 East-West measures to reduce sea turtle takes in the possibility of increasing minimum Highway, Silver Spring, MD 20910; or the Atlantic pelagic longline fishery, observer coverage levels in this fishery faxed to (301) 713–1917. Comments will including, but not limited to: to improve the quality and quantity of not be accepted if submitted via email modification of fishing gears and data on bycatch of turtles and other or Internet. techniques in the pelagic longline species. fishery; possession and use of on-board FOR FURTHER INFORMATION CONTACT: equipment to minimize sea turtle Pelagic Longline Definition Russell Dunn, Rick Pearson, or Greg bycatch and bycatch mortality; In addition, NMFS is considering Fairclough at (727) 570–5447. modification of time and area closures; possible clarifications of either the SUPPLEMENTARY INFORMATION: The and increased minimum levels of pelagic or bottom longline definition. Atlantic pelagic longline fishery for observer coverage. Atlantic HMS primarily targets Request for Comments swordfish, yellowfin tuna, and bigeye Hook and Bait Combinations NMFS requests comments on tuna in various areas and seasons. The Vessels participating in the pelagic management options for this action. Atlantic tuna, swordfish, and billfish longline fishery are currently required Specifically, NMFS requests comments fisheries are managed under the to use non-stainless steel corrodible on the following issues and possible authority of the Magnuson-Stevens hooks during fishing operations. Vessels options to reduce sea turtle bycatch and Fishery Conservation and Management participating in this fishery in the Gulf bycatch mortality: modification of Act (Magnuson-Stevens Act) and the of Mexico are also prohibited from using fishing gears and techniques in the Atlantic Tunas Convention Act. The live bait in the western Gulf of Mexico. pelagic longline fishery, area closures, Fishery Management Plan for Atlantic NMFS may examine the mandatory use onboard bycatch mitigation, and Tunas, Swordfish, and Sharks (HMS of various hook and bait combinations, minimum observer coverage levels.

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00022 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66784 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

NMFS will proceed with preparation Regional Administrator for Sustainable northward to the U.S./Canada border. of a draft SEIS and proposed rule, Fisheries, Northeast Region, NMFS Implementing regulations for these incorporating comments received (Assistant Regional Administrator), has fisheries are found at 50 CFR part 648, during the comment period associated made a preliminary determination that subparts A, G (summer flounder), H with this NOI as appropriate. The draft the activities authorized under the EFPs (scup), and I (black sea bass). EIS and proposed rule will include issued in response to the approved The regulations outline the process additional opportunities for public Research Set-Aside (RSA) projects for specifying annually the catch limits comment. NMFS anticipates completing would be consistent with the goals and for the summer flounder, scup, and this amendment and any related objectives of the FMP. However, further black sea bass commercial and documents by , 2004. review and consultation may be recreational fisheries, as well as other management measures (e.g., mesh Authority: 16 U.S.C. 1801 et seq. necessary before a final determination is made to issue any EFP. requirements, minimum fish sizes, gear Dated: , 2003. DATES: Comments on this proposed rule restrictions, possession restrictions, and Richard W. Surdi, must be received on or before December area restrictions) for these fisheries. The Acting Director, Office of Sustainable 15, 2003. measures are intended to achieve the Fisheries, National Marine Fisheries Service. ADDRESSES: Copies of the specifications annual targets set forth for each species [FR Doc. 03–29827 Filed 11–26–03; 8:45 am] document, including the Environmental in the FMP, specified either as an F rate BILLING CODE 3510–22–S Assessment, Regulatory Impact Review, or an exploitation rate (the proportion of and Initial Regulatory Flexibility fish available at the beginning of the Analysis (EA/RIR/IRFA) and other year that are removed by fishing during DEPARTMENT OF COMMERCE supporting documents for the the year). Once the catch limits are specifications are available from Daniel established, they are divided into quotas National Oceanic and Atmospheric based on formulas contained in the Administration Furlong, Executive Director, Mid- Atlantic Fishery Management Council, FMP. As required by the FMP, a Monitoring 50 CFR Part 648 Room 2115, Federal Building, 300 South Street, Dover, DE 19901–6790. The Committee for each species, made up of [Docket No. 031119283–3283–01; I.D. specifications document is also members from NMFS, the Commission, 110703A] accessible via the Internet at http:// and both the Mid-Atlantic and New England Fishery Management Councils, RIN 0648–AQ80 www.mafmc.org. Written comments on the proposed rule should be sent to is required to review annually the best Fisheries of the Northeastern United Patricia A. Kurkul, Regional available scientific information and to States; Summer Flounder, Scup, and Administrator, NMFS, Northeast recommend catch limits and other Black Sea Bass Fisheries; 2004 Regional Office, One Blackburn Drive, management measures that will achieve Specifications; 2004 Research Set- Gloucester, MA 01930. Mark the outside the target F or exploitation rate for each Aside Projects of the envelope ‘‘Comments—2004 fishery. The Council’s Demersal Species Committee and the Commission’s Summer Flounder, Scup, and Black Sea AGENCY: National Marine Fisheries Summer Flounder, Scup, and Black Sea Bass Specifications.’’ Comments may Service (NMFS), National Oceanic and Bass Management Board (Board) then also be sent via facsimile (fax) to (978) Atmospheric Administration (NOAA), consider the Monitoring Committees’ 281–9135. Comments will not be Commerce. recommendations and any public accepted if submitted via e-mail or the comment and make their own ACTION: Proposed rule; request for Internet. comments. recommendations. While the Board FOR FURTHER INFORMATION CONTACT: action is final, the Council’s SUMMARY: NMFS proposes specifications Sarah McLaughlin, Fishery Policy recommendations must be reviewed by for the 2004 summer flounder, scup, Analyst, (978) 281–9279, fax (978) 281– NMFS to assure that they comply with and black sea bass fisheries. The 9135, e-mail FMP objectives. The Council and Board implementing regulations for the [email protected]. made their annual recommendations at Fishery Management Plan for the SUPPLEMENTARY INFORMATION: a joint meeting held –7, 2003. Summer Flounder, Scup, and Black Sea Bass Fisheries (FMP) require NMFS to Background Explanation of Research Set-Aside publish specifications for the upcoming The summer flounder, scup, and In 2001, regulations were fishing year for each of the species and black sea bass fisheries are managed implemented under Framework to provide an opportunity for public cooperatively by the Atlantic States Adjustment 1 to the FMP to allow up to comment. NMFS requests comment on Marine Fisheries Commission 3 percent of the Total Allowable proposed management measures for the (Commission) and the Mid-Atlantic Landings (TAL) for each of the species 2004 summer flounder, scup, and black Fishery Management Council (Council), to be set aside each year for scientific sea bass fisheries. The intent of this in consultation with the New England research purposes. For the 2004 fishing action is to establish 2004 harvest levels and South Atlantic Fishery Management year, a Request for Proposals was and other measures to attain the target Councils. The management units published in January 2003 to solicit fishing mortality (F) or exploitation specified in the FMP include summer research proposals based upon the rates, as specified for these species in flounder (Paralichthys dentatus) in U.S. research priorities that were identified the FMP. In addition, NMFS has waters of the Atlantic Ocean from the by the Council (68 FR 3864, January 27, conditionally approved three research southern border of North Carolina (NC) 2003). The deadline for submission of projects for the harvest of the quota that northward to the U.S./Canada border, proposals was March 28, 2003. Three has been recommended by the Council and scup (Stenotomus chrysops) and applicants were notified in August 2003 to be set aside for research purposes. In black sea bass (Centropristis striata) in that their research proposals had anticipation of receiving applications U.S. waters of the Atlantic Ocean from received favorable preliminary review. for Experimental Fishing Permits (EFPs) 35°13.3′ N. lat. (the latitude of Cape For informational purposes, this to conduct this research, the Assistant Hatteras Lighthouse, Buxton, NC) proposed rule includes a statement

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00023 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66785

indicating the amount of quota that has would be surveyed in March. NMFS anticipates that the information been preliminarily set aside for research Additional transects may be conducted necessary to determine whether overage purposes, as recommended by the if necessary. Approximately 20 vessels deductions are necessary will be Council and Board, and a brief operating from Rhode Island to North available by time of publication of the description of the three RSA projects. Carolina would participate in the final rule to implement these The RSA amounts may be adjusted in project over the period of January 1 specifications. The commercial quotas the final rule establishing the annual through December 31, 2004. The RSA contained in this proposed rule for specifications for the summer flounder, allocated for the project is 74,750 lb (40 summer flounder, scup, and black sea scup, and black sea bass fisheries or, if mt) of summer flounder; 120,000 lb (54 bass do not reflect any deductions for the total amount of the quota set-aside mt) of scup; 281,250 lb (128 mt) of overages. The final rule, however, will is not awarded, NMFS will publish a Loligo squid; 51,000 lb (23 mt) of black contain quotas that have been adjusted notice in the Federal Register to restore sea bass; and 104,816 lb (48 mt) of consistent with the procedures the unused RSA amount to the bluefish. described above and contained in the applicable TAL. The Cornell Cooperative Extension of regulatory amendment. Accordingly, For 2004, three RSA projects have Suffolk County, New York, submitted a landings information will be based been conditionally approved by NMFS, proposal to evaluate fish escapement upon: (1) Landings reported for the and are currently awaiting award by the from certain gear and fish behavior of period January 1–October 31, 2003; (2) NOAA Grants Office. The total RSA black sea bass, and is intended to landings from the period – quota, approved by the Council and enhance fishery information relative to December 31, 2002; and (3) late reported Board, allocated for all three projects the black sea bass pot fishery in the landings for the period January are: 174,750 lb (79 metric tons (mt)) of Mid-Atlantic region. With the use of 1–October 31, 2002. summer flounder; 160,000 lb (73 mt) of experimental pots and underwater scup; 134,792 lb (61 mt) of black sea video, various escape vent Summer Flounder bass; 281,250 lb (128 mt) of Loligo configurations would be investigated. The FMP specifies a target fishing squid; and 297,750 lb (135 mt) of The project would also explore black mortality rate (F) of Fmax, that is, the bluefish. sea bass mortality in pots left fishing level of fishing that produces maximum The University of Rhode Island during closed periods. Additionally, a yield per recruit. The best available submitted a proposal to develop a sea sampling and dockside sampling scientific information indicates that, for fishery-independent scup survey that program for black sea bass that 2004, Fmax for summer flounder is 0.26 utilizes unvented fish traps fished on supplements the NMFS black sea bass (equal to an exploitation rate of about 22 hard bottom areas in southern New tagging program would be implemented. percent from fishing). England waters to characterize the size One vessel would conduct the project, The status of the summer flounder composition of the scup population. and sampling would occur off Long stock is evaluated annually. The most Survey activities would be conducted Island, New York, from April 1 through recent stock assessment, updated by the from through November 30, 2004, December 31, 2004. The RSA allocated Northeast Fisheries Science Center at six rocky bottom study sites located for the project is 71,500 lb (32 mt) of (NEFSC) Southern Demersal Working offshore, where there is a minimal scup black sea bass. Group in June 2003, indicated that the pot fishery and no active trawl fishery. Regulations under the Magnuson- summer flounder stock is not overfished One vessel would conduct the project. Stevens Fishery Conservation and and overfishing is not occurring, Sampling would occur off the coasts of Management Act (Magnuson-Stevens according to the definitions in the FMP. Rhode Island and southern Act) require publication of this This conclusion was derived from the Massachusetts. The RSA allocated for notification to provide interested parties fact that, in 2002, the estimated total this project is 12,292 lb (5.6 mt) of black the opportunity to comment on stock biomass of 124 million lb (56,246 sea bass and 40,000 lb (18 mt) of scup. applications for proposed EFPs. mt) is 5 percent above the biomass The National Fisheries Institute and threshold of 117.3 million lb (53,200 mt) Rutgers University submitted a proposal Explanation of Quota Adjustments Due under which the stock is considered to Quota Overages 1 to conduct a second year of work on the overfished ( ⁄2Bmsy), and the estimated F development/refinement of a This proposed rule calculates of 0.23 was below the FMP overfishing commercial vessel-based survey commercial quotas based on the definition of F=Fmax=0.26. In addition, program in the Mid-Atlantic region that proposed TALs and Total Allowable spawning stock biomass (SSB) has tracks the migratory behavior of selected Catches (TACs) and the formulas for increased steadily from 20.5 million lb recreationally and commercially allocation contained in the FMP. In (9,303 mt) in 1993 to 93 million lb important species. Information gathered 2002, NMFS published final regulations (42,185 mt) in 2002, the highest value in during this project would supplement to implement a regulatory amendment the time series. Although the stock is no the NMFS finfish survey databases and (67 FR 6877, , 2002) that longer considered overfished, additional include development of ways to better revised the way in which the rebuilding is necessary because the evaluate how seasonal migration of fish commercial quotas for summer Magnuson-Stevens Act requires that in the Mid-Atlantic influences stock flounder, scup, and black sea bass are stocks be rebuilt to the level that abundance estimates. One vessel would adjusted if landings in any fishing year produces maximum sustainable yield on conduct research trawl survey work in exceed the quota allocated (thus a continuing basis, i.e., 234.6 million lb the Mid-Atlantic along six offshore resulting in a quota overage). If NMFS (106,400 mt) for summer flounder. transects near Alvin, Hudson, approves a different TAL or TAC at the The Summer Flounder Monitoring Wilmington, Baltimore, and Washington final rule stage, the commercial quotas Committee reviewed the stock status Canyons. Up to 16, 2-hour tows would will be recalculated based on the and recommended a TAL of 28.2 be conducted among 10 sites along each formulas in the FMP. Likewise, if new million lb (12,791 mt), an increase of 21 transect from 45 to 225 fathoms (82 to information indicates that overages have percent relative to the 2003 TAL. The 411 meters). The Baltimore and Hudson occurred and deductions are necessary, Monitoring Committee determined that Canyons transects would be surveyed in NMFS will publish notice of the this TAL would have at least a 50- January and May and all six transects adjusted quotas in the Federal Register. percent probability of achieving the

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00024 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66786 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

Ftarget (0.26) that is specified in the FMP, (7,630 mt) and a recreational harvest NMFS proposes to implement the if the 2003 TAL and assumed discard limit of 11.21 million lb (5,085 mt). 28.2-million lb (12,791-mt) TAL with a levels are not exceeded. The TAL In addition, the Commission is 174,750-lb (79.3-mt) RSA, as associated with the target F is allocated expected to maintain the voluntary recommended by the Council and 60 percent to the commercial sector and measures currently in place to reduce Board. The 11.21-million lb (5,085-mt) 40 percent to the recreational sector; regulatory discards that occur as a result recreational harvest limit would be therefore, the initial TAL would be of landing limits established by the allocated on a coastwide basis. The allocated 16.92 million lb (7,675 mt) to states. The Commission established a commercial quota would be allocated to system whereby 15 percent of each the commercial sector and 11.28 million the states as shown in Table 1. Table 1 state’s quota would be voluntarily set lb (5,117 mt) to the recreational sector. presents the allocations by state, with aside each year to enable vessels to land The commercial quota is then allocated and without the commercial portion of to the coastal states based upon an incidental catch allowance after the directed fishery has been closed. The the 174,750-lb (79.3-mt) RSA deduction. percentage shares specified in the FMP. intent of the incidental catch set-aside is These state quota allocations are The Council and Board adopted the to reduce discards by allowing preliminary and are subject to a Summer Flounder Monitoring fishermen to land summer flounder reduction if there are overages of a Committee’s recommendation. The caught incidentally in other fisheries state’s 2003 quota (using the landings Council and Board also agreed to set during the year, while also ensuring that information and procedures described aside 174,750 lb (79.3 mt) of the the state’s overall quota is not exceeded. earlier). Any commercial quota summer flounder TAL for research These Commission set-asides are not adjustments will be published in the activities. After deducting the RSA, the included in any tables in this document, Federal Register in the final rule TAL would be divided into a because NMFS does not have authority implementing these specifications. commercial quota of 16.82 million lb to establish such subcategories.

TABLE 1.—2004 PROPOSED INITIAL SUMMER FLOUNDER STATE COMMERCIAL QUOTAS

Commercial quota Commercial quota less RSA State Percent share lb kg 1 lb kg 1

ME ...... 0.04756 8,047 3,650 7,997 3,628 NH ...... 0.00046 78 35 77 35 MA ...... 6.82046 1,154,022 523,461 1,146,871 520,217 RI ...... 15.68298 2,653,560 1,203,647 2,637,117 1,196,188 CT ...... 2.25708 381,898 173,228 379,531 172,154 NY ...... 7.64699 1,293,871 586,896 1,285,853 583,259 NJ ...... 16.72499 2,829,868 1,283,620 2,812,332 1,275,665 DE ...... 0.01779 3,010 1,365 2,991 1,357 MD ...... 2.03910 345,016 156,498 342,878 155,528 VA ...... 21.31676 3,606,796 1,636,032 3,584,445 1,625,894 NC ...... 27.44584 4,643,836 2,106,430 4,615,059 2,093,377

Total ...... 100.00001 16,920,002 7,674,862 16,815,152 7,627,303 1 Kilograms are as converted from pounds and do not add to the converted total due to rounding.

Scup SARC 35 noted that the stock can likely in the rebuilding schedule that was Scup was most recently assessed at sustain modest increases in catch, but approved when scup was added to the the 35th Northeast Regional Stock that such increases should be taken with FMP in 1996, prior to passage of the Assessment Review Committee (SARC due consideration of the uncertainties Sustainable Fisheries Act (SFA). 35) in June 2002. SARC 35 concluded associated with the stock status Subsequently, to comply with the SFA that scup are no longer overfished, but determination. amendments to the Magnuson-Stevens stock status with respect to overfishing The target exploitation rate for scup Act, the Council prepared Amendment cannot currently be evaluated, due to a for 2004 is 21 percent. The FMP 12, which proposed to maintain the lack of reliable discard estimates and specifies that the TAC associated with a existing rebuilding schedule for scup information regarding the length given exploitation rate be allocated 78 established by Amendment 8. On April composition of scup landings and percent to the commercial sector and 22 28, 1999, NMFS disapproved that discards. Scup SSB is increasing. The percent to the recreational sector. Scup rebuilding plan for scup because the NEFSC spring survey 3-year average discard estimates are deducted from rebuilding schedule did not appear to be (2001 through 2003) for scup SSB was both sectors’ TACs to establish TALs for sufficiently risk-averse. NMFS advised 3.31 kg/tow, which is about 19 percent each sector (TAC less discards = TAL). the Council that the exploitation rate higher than the threshold that defines The commercial TAL is then allocated reflects the overfishing definition the stock as overfished (2.77 kg/tow). on a percentage basis to three quota (converted to an F rate) which is SARC 35 indicated that relative periods, as specified in the FMP: Winter conceptually sound and supported by exploitation rates on scup have declined I (January–April)—45.11 percent; NMFS. Therefore, for the short term, the in recent years, although the absolute Summer (May–October)—38.95 percent; proposed scup specifications for 2004 value of F cannot be determined. and Winter II (November–December)— are based on an exploitation rate of 21 Overall, most recent scup survey 15.94 percent. percent. NMFS believes that the long- observations indicate strong recruitment The proposed scup specifications for term risks associated with the and some rebuilding of age structure. 2004 are based on an exploitation rate disapproved rebuilding plan are not

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66787

applicable to the proposed a three-year moving average of the also agreed to set aside 160,000 lb (73 specifications since they apply only for survey biomass index rather than a mt) of the scup TAL for research one fishing year and will be reviewed, single index data point. The rationale of activities. The TAL, after deducting the and modified as appropriate, by the the Council and the Board for the 160,000-lb (73-mt) RSA, would result in Council and NMFS annually. The scup rejection of the Monitoring Committee a commercial quota of 12.35 million lb stock has shown signs of significant recommendation was based on a (5,600 mt) and a recreational harvest rebuilding and is no longer overfished. comparison of the three-year moving limit of 3.99 million lb (1,812 mt). It is, therefore, not necessary for 2004 to average biomass index calculated this deviate from the specified exploitation year (3.31 kg/tow) compared with the NMFS is proposing to retain the rate. Furthermore, setting the scup index value calculated last year (3.30 current Winter period possession limits specifications using an exploitation rate kg/tow). Because the value for 2001 of 15,000 lb (6.8 mt) for Winter I of 21 percent is a more risk-averse through 2003 is slightly higher than the (January–April), with a reduction to approach to managing the resource than value for 2000 through 2002, the 1,000 lb (454 kg) when 80 percent of the not setting any specifications until the Council did not support a Winter I quota is projected to be Council submits, and NMFS approves, a recommendation for a 33-percent harvested, and 1,500 lb (680 kg) for revised rebuilding plan that complies decrease in the scup quota. NMFS is Winter II (November–December). Public with all Magnuson-Stevens Act proposing to implement the Council’s comments are requested on these requirements. and Board’s TAC/TAL recommendation proposed measures. The Scup Monitoring Committee because it is considered likely to The final rule to implement reviewed the available data in making achieve the 21-percent exploitation rate Framework 3 to the FMP (68 FR 62250, its recommendation to the Council. The that is required by the FMP. , 2003) implemented a Scup Monitoring Committee Using the sector allocation specified process, for years in which the full recommended a scup TAC of 13.15 in the FMP (commercial—78 percent; Winter I commercial scup quota is not million lb (5,965 mt), and a TAL of 11.0 recreational—22 percent), the Council’s harvested, to allow unused quota from million lb (4,990 mt), i.e., a 33-percent recommendation would result in a reduction from the 2003 TAL. The commercial TAC of 14.55 million lb the Winter I period to be rolled over to Council and Board rejected the (6,600 mt) and a recreational TAC of the quota for the Winter II period. In any Monitoring Committee’s TAC and TAL 4.10 million lb (1,860 mt). Using the year that NMFS determines that the recommendations, and instead adopted same commercial and recreational landings of scup during Winter I are less an 18.65-million lb (8,460-mt) TAC and discard estimates used for the 2003 than the Winter I quota for that year, a 16.5-million lb (7,484-mt) TAL (i.e., specifications (i.e., 2.08 million lb (943 NMFS will, through a notification in the the same amounts as implemented in mt) for the commercial sector, and Federal Register, increase the Winter II 2003). The reduction proposed by the 70,000 lb (32 mt) for the recreational quota for that year by the amount of the Monitoring Committee was in response sector), the Scup MC recommendation Winter I underharvest, and adjust the to lower survey biomass index in the would result in an initial commercial Winter II possession limits consistent spring 2003 survey than in the spring TAL of 12.47 million lb (5,656 mt) and with the amount of the quota increase, 2002 survey. However, the reference recreational harvest limit of 4.03 million based on the possession limits point measure specified in the FMP is lb (1,828 mt). The Council and Board presented in Table 2.

TABLE 2.—POTENTIAL INCREASE IN WINTER II POSSESSION LIMITS BASED ON THE AMOUNT OF SCUP ROLLED OVER FROM WINTER I TO WINTER II PERIOD

Initial Winter II possession limit Rollover from Winter I to Winter II Increase in initial Winter II Final Winter II possession possession limit limit after rollover from Winter I to Winter II lb kg lb mt lb kg lb kg

1,500 ...... 680 0–499,999 0–227 0 0 1,500 680 1,500 ...... 680 500,000–999,999 227–454 500 227 2,000 907 1,500 ...... 680 1,000,000–1,499,999 454–680 1,000 454 2,500 1134 1,500 ...... 680 1,500,000–1,999,999 680–907 1,500 680 3,000 1361 1,500 ...... 680 2,000,000–2,500,000 907–1,134 2,000 907 3,500 1587

Table 3 presents the 2004 commercial allocations are preliminary and may be using the procedures for calculating allocation recommended by the Council subject to downward adjustment due to overages described earlier. with, and without, the 160,000-lb (73- 2003 overages in the final rule mt) RSA deduction. These 2004 implementing these specifications,

TABLE 3.—2004 PROPOSED INITIAL TOTAL ALLOWABLE CATCH, COMMERCIAL SCUP QUOTA, AND POSSESSION LIMITS, IN LB (KG)

Commercial quotas Period Percent TAC Discards Commercial quota less RSA Possession limits

Winter I ...... 45.11 6,563,505 938,288 5,625,217 5,568,920 1 15,0001 (2,977,186) (425,605) (2,551,582) (2,526,045) (6,804) Summer ...... 38.95 5,667,225 810,160 4,857,065 4,808,455 (3) (2,570,636) (367,486) (2,203,150) (2,181,101) ......

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00026 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66788 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

TABLE 3.—2004 PROPOSED INITIAL TOTAL ALLOWABLE CATCH, COMMERCIAL SCUP QUOTA, AND POSSESSION LIMITS, IN LB (KG)—Continued

Commercial quotas Period Percent TAC Discards Commercial quota less RSA Possession limits

Winter II ...... 15.94 2,319,270 331,522 1,987,718 1,967,825 1,500 (1,052,014) (150,391) (901,623) (892,600) (680)

Total 2 .... 100.00 14,550,000 2,080,000 12,470,000 12,345,200 ...... (6,599,837) (943,482) (5,656,355 (5,599,745) ...... 1 The Winter I landing limit would drop to 1,000 lb (454 kg) upon attainment of 80 percent of the seasonal allocation. 2 Totals subject to rounding error. 3 Not applicable.

The Council and Board did not Council staff and others and noted that anticipated in the GRA during the recommend any other changes to the in some years the distribution of Loligo month; existing commercial minimum mesh squid and scup overlapped, increasing (4) In addition to the above advance size, minimum mesh threshold the potential for scup discards. notice for accessing the GRA, for the possession limit, or the commercial However, they were concerned that purpose of randomly selecting vessels to minimum fish size. Therefore, these Loligo squid fishermen would be carry a NMFS-certified observer, a management measures are proposed to restricted from areas and during times vessel must notify NMFS of its intention remain unchanged. when Loligo squid and scup did not co- to fish in the GRA at least 5 working occur. As such, the Council days prior to the date it intends to Scup Gear Restricted Areas (GRAs)— depart on each trip into a GRA. For each Request for Comments recommended a GRA Access Program, patterned after the program used to of these reports, vessels must submit the In 2000, the 31st Stock Assessment provide access to sea scallops in the following information: Vessel name and Review Committee (SARC 31) groundfish closed areas in 1999 through permit number; owner and operator’s emphasized the need to reduce scup 2001, that would allow small mesh names; owner and operator’s phone mortality resulting from discards in the fisheries to occur in the GRAs until a numbers; date and time of departure; scup fishery and in other fisheries. In pre-determined level of scup discards port of departure; and the specific GRA response to that recommendation, GRAs was reached to trigger a closure to small to be fished; were established during the 2000 fishing mesh gear. The triggers for the Northern (5) A vessel which does not have a year (65 FR 33486, , 2000, and and Southern GRA would be 50,000 lb valid Coast Guard Inspection Sticker is 65 FR 81761, Dec. 27, 2000) and (22.68 mt) and 70,000 lb (31.75 mt) of deemed inadequate or unsafe for modified for the 2001 fishing year (66 scup discards, respectively. These were purposes of carrying a NMFS-certified FR 12902, , 2001). The GRAs chosen by the Council as appropriate observer and will be prohibited from prohibit trawl vessels from fishing for, levels to indicate that discards had participating in the Area Access or possessing, certain non-exempt become significant and that the areas Program until the vessel is inspected by species (Loligo squid, black sea bass, should be closed to small mesh the Coast Guard and receives its and silver hake (whiting)) when fishing fisheries. The Council recommended inspection sticker; (6) On the day that the vessel leaves with mesh smaller than that required to that the NMFS Northeast Fisheries port to fish under the GRA Access fish for scup during the effective periods Science Center determine the level of Program, the vessel owner or operator (January 1 through for the observer coverage necessary to provide Southern GRA, and November 1 through must declare the vessel into the GRA an accurate estimate of scup discards December 31 for the Northern GRA). Access Program through the VMS prior with a high confidence level. For 2003, the Council recommended to leaving port; allowing vessels to fish for non-exempt The Council recommended the (7) The vessel owner will be species with small mesh in the GRAs, following requirements of the GRA responsible for paying the cost of the provided they use specially modified Access Program: observer; and trawl nets, and carry observers, (1) All qualified vessels that wish to (8) The GRA Access Program for each consistent with Atlantic Coastal participate in the GRA Exemption area would end when the discard of Cooperative Statistics Program observer Program must enroll in the program and scup was projected to be 50,000 lb standards. Instead, NMFS implemented obtain a Letter of Authorization from the (22.68 mt) for the Northern GRA and an alternative program (the GRA Regional Administrator; 70,000 lb (31.75 mt) for the Southern Exemption Program), requiring 100- (2) All participating vessels must have GRA. Termination of the GRA Access percent observer coverage for all vessels installed on board an operational vessel Program for each area will be made fishing with small mesh for non-exempt monitoring system (VMS) unit; through notification in the Federal species in the GRAs, using the modified (3) A vessel planning to fish in the Register. gear. This alternative imposed GRAs must submit a report through the The Council recommended that once significantly fewer administrative and VMS e-mail messaging system of its the triggers are reached and the GRAs enforcement complexities, and was intention to fish in the GRA prior to the are closed to small mesh fishermen, the intended to provide more data to 25th of the month before the month in existing GRA Exemption Program evaluate the effectiveness of the gear which the anticipated trip(s) are to be (described at 68 FR 60) resume. modifications (68 FR 60, , taken. The report must include the NMFS proposes to implement the 2003). following information: Vessel name and Council’s recommendations regarding Since the final rule for the 2003 permit number; owner and operator’s access to the GRAs as described above, fishing year, the Council has reviewed names; owner and operator’s phone with the exception of the resumption of a number of analyses conducted by numbers; and number of trips the GRA Exemption program once a

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00027 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66789

discard trigger is met, the requirement increase of almost 18 percent relative to summer flounder, scup, and black sea to notify NMFS of the intention to fish the 2003 TAL. The FMP specifies that bass fisheries would be published; (2) in the GRA the month before the month the TAL associated with a given the indefinite management measures in which the anticipated trip(s) are to be exploitation rate be allocated 49 percent (minimum sizes, bag limits, possession taken, and the random selection of to the commercial sector and 51 percent limits, permit and reporting vessels to carry a NMFS-certified to the recreational sector; therefore, the requirements, etc.) would remain observer. NMFS maintains that the initial TAL would be allocated 3.92 unchanged; (3) there would be no quota purpose of the GRA Access Program million lb (1,778 mt) to the commercial set-aside allocated to research in 2004; should be to record data regarding the sector and 4.08 million lb (1,851 mt) to (4) the existing GRA regulations would use and effectiveness of gear the recreational sector. The Council and remain in place for 2004; and (5) there modifications employed by the Board adopted this TAL, indicating that would be no specific cap on the participating vessels in attempts to it would achieve the 25-percent allowable annual landings in these reduce scup bycatch, and also to exploitation rate, and agreed to set aside fisheries (i.e., there would be no quota). monitor scup discards so that the GRA 134,792 lb (61 mt) for research Implementation of the no action Access Program can be discontinued activities. After deducting the RSA, the alternative would be inconsistent with when the trigger is reached. Also, TAL would be divided into a the goals and objectives of the FMP, its because the trigger amount involves commercial quota of 3.86 million lb implementing regulations, and the only scup that are discarded, only (1,751 mt) and a recreational harvest Magnuson-Stevens Act. In addition, the limited information must be collected limit of 4.01 million lb (1,819 mt). The no action alternative would under the GRA Access Program. The Council and Board recommended that substantially complicate the approved Northeast Fisheries Science Center has all other measures remain unchanged. management program for these fisheries, recommended that NMFS utilize NMFS proposes to implement the and would very likely result in individuals to serve as ‘‘scup GRA 8.0-million lb (3,629-mt) TAL with a overfishing of the resources. Therefore, monitors,’’ rather than NMFS-certified 134,792-lb (61-mt) RSA, as observers as required under the current recommended by the Council and the no action alternative is not regulations, to collect data on scup Board. The final rule to implement considered to be a reasonable alternative discards. A similar system exists for Amendment 13 to the FMP (68 FR to the preferred action. monitoring in the Atlantic sea scallop 10181, , 2003) established an Alternative 1 consists of the harvest fishery. NMFS proposes that approved annual (calendar year) coastwide quota limits proposed by the Council and scup GRA monitors be placed on 100 for the commercial black sea bass Board for summer flounder, scup, and percent of the vessels that participate in fishery to replace the quarterly quota black sea bass. Alternative 2 consists of the GRA Access program. NMFS is allocation system. the most restrictive quotas (i.e., lowest seeking comment on the landings) considered by the Council and Classification implementation of the proposed GRA the Board for all of the species. Access Program and the use of NMFS- This proposed rule has been Alternative 3 consists of the least approved scup GRA monitors. determined to be not significant for restrictive quotas (i.e., highest landings) purposes of Executive Order 12866. Black Sea Bass considered by the Council and Board for The Council prepared an Initial all three species. Although Alternative 3 Black sea bass was last assessed in Regulatory Flexibility Analysis (IRFA) would result in higher landings for June 1998 at SARC 27, which indicated that describes the economic impact this 2004, it would also likely exceed the that the species was overexploited and proposed rule, if adopted, would have biological targets specified in the FMP. at a low biomass level. However, the on small entities. A description of the best available current information on action, why it is being considered, and First, a preliminary adjusted quota stock status indicates that the stock has the legal basis for this action are was calculated by deducting the RSA increased in recent years and is no contained in the preamble to this rule. from the TAL. Then, the preliminary longer overfished. The SSB estimate for This proposed rule does not duplicate, commercial quota overages for the 2003 2003 (using a 3-year moving average of overlap, or conflict with other Federal fishing year were deducted from the 2001–2003) is 0.509 kg/tow, about 30 rules. A copy of the complete IRFA can initial 2004 quota alternatives. The percent higher than the 2000–2002 be obtained from the Northeast Regional quota overages were calculated average of 0.391 kg/tow. Office of NMFS (see ADDRESSES) or via according to the procedures described For 2004, the target exploitation rate the Internet at http:/www.nero.nmfs.gov. earlier, using available data as of for black sea bass is 25 percent. The A summary of the analysis follows. September 2003. The resulting Black Sea Bass Monitoring Committee The economic analysis assessed the preliminary adjusted commercial quotas reviewed the stock status and the impacts of the various management alternatives presented in Table 4 are projections based upon these data and alternatives. In the EA, the no action provisional and may be further adjusted recommended that the TAL for 2004 be alternative is defined as follows: (1) No in the final rule implementing the 2004 set at 8 million lb (3,629 mt), an proposed specifications for the 2004 specifications.

TABLE 4.—COMPARISON OF THE ALTERNATIVES OF QUOTA COMBINATIONS REVIEWED [In million lb]

2003 2004 2004 2004 initial Commercial Preliminary Preliminary TAL 2004 RSA quota adjusted com- recreational overage mercial quota* harvest limit

Quota Alternative 1 (Preferred)

Summer Flounder Preferred Alternative ...... *28.20 0.17 0.05 16.77 11.21 Scup Preferred Alternative (Status quo) ...... 16.50 0.16 0.00 12.35 3.99

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00028 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66790 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

TABLE 4.—COMPARISON OF THE ALTERNATIVES OF QUOTA COMBINATIONS REVIEWED—Continued [In million lb]

2003 2004 2004 2004 initial Commercial Preliminary Preliminary TAL 2004 RSA quota adjusted com- recreational overage mercial quota* harvest limit

Black Sea Bass Preferred Alternative ...... 8.00 0.13 0.00 3.86 4.01

Quota Alternative 2 (Most Restrictive)

Summer Flounder ...... 23.30 0.17 0.05 13.83 9.25 Scup Alternative 2 ...... 11.00 0.16 0.00 8.06 2.78 Black Sea Bass Alternative 2 (Status Quo) ...... 6.80 0.13 0.00 3.27 3.40

Quota Alternative 3 (Least Restrictive)

Summer Flounder Alternative 3 ...... 30.10 0.17 0.05 17.91 11.97 Scup Alternative 3 ...... 22.00 0.16 0.00 16.64 5.20 Black Sea Bass Alternative 3 ...... 8.90 0.13 0.00 4.30 4.47 * Note that preliminary quotas are provisional and may change to account for overage of the 2003 quotas.

Table 5 presents the percent change and RSA) compared to the final adjusted associated with each of commercial quotas for 2003. quota alternatives (adjusted for overages

TABLE 5.—PERCENT CHANGE ASSOCIATED WITH ADJUSTED COMMERCIAL QUOTA ALTERNATIVES COMPARED TO 2003 ADJUSTED QUOTA

Total changes including overages and RSA Quota alternative Quota alternative Quota alternative 2 (most 3 (least 1 (preferred) restrictive) restrictive)

Summer Flounder

Aggregate Change ...... +21.30 *+0.03 +29.55

Scup

Aggregate Change ...... *+2.07 ¥33.39 +37.52

Black Sea Bass

Aggregate Change ...... +28.24 *+8.64 +42.86 * Denotes status quo management measures. The status quo or ‘‘no action’’ measure for summer flounder, scup, and black sea bass refers to what most likely will occur in the absence of implementing the proposed regulation.

All vessels that would be impacted by participated (i.e., landed these species) than 5 percent) due to the decrease in this proposed rulemaking are in these fisheries in 2002. the adjusted scup quota. No vessels considered to be small entities; The Council estimated the total were expected to have revenue losses of therefore, there would be no revenues derived from all species greater than 5 percent. disproportionate impacts between large landed by each vessel during calendar The Council also analyzed changes in and small entities. The categories of year 2002 to determine a vessel’s total gross revenue that would occur as small entities likely to be affected by dependence and revenue derived from a a result of the quota alternatives. this action include commercial and particular species. This estimate Assuming 2002 ex-vessel prices charter/party vessel owners holding an provided the base from which to (summer flounder—$1.51/lb; scup— active Federal permit for summer compare the effects of the proposed $0.66/lb; and black sea bass—$1.73/lb), flounder, scup, or black sea bass, as well quota changes from 2003 to 2004. the 2004 quotas in Preferred Alternative as owners of vessels that fish for any of The Council’s analysis of the harvest 1 (after overages have been applied) these species in state waters. The limits in Alternative 1 (Preferred would increase total summer flounder, Council estimates that the proposed Alternative) indicated that these harvest scup, and black sea bass revenues by 2004 quotas could affect 2,122 vessels levels would produce a revenue approximately $4.4 million, $165,000, that held a Federal summer flounder, increase for 1,036 commercial vessels and $1.5 million, respectively, relative scup, and/or black sea bass permit in that are expected to be impacted by this to 2003 revenues. 2002. However, the more immediate rule. The remaining 5 vessels, which Assuming that the total ex-vessel impact of this rule will likely be felt by landed scup only, were projected to gross revenue associated with the the 1,041 vessels that actively incur small revenue losses (i.e., less Preferred Alternative for each fishery is

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00029 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66791

distributed equally among the vessels revenue increase for all 1,041 recreational harvest limit, and that landed that species in 2002, the commercial vessels. Assuming 2002 represents a 50-percent increase from average increase in gross revenue per ex-vessel prices as described above, the 2002 landings. If Alternative 1, 2, or 3 vessel associated with the preferred 2004 quotas in Alternative 3 (after is chosen, it is possible that more quota would be $5,585 for summer overages have been applied) would restrictive management measures may flounder, $331 for scup, and $1,998 for increase total summer flounder, scup, be required to prevent anglers from black sea bass. The number of vessels and black sea bass revenues by exceeding the 2004 recreational harvest landing summer flounder, scup, and approximately $6.2 million, $3.0 limit, depending upon the effectiveness black sea bass in 2002 was 796, 499, and million, and $2.2 million, respectively, of the 2003 recreational management 736, respectively. relative to 2003 revenues. measures. More restrictive regulations The overall increase in gross revenue Assuming that the total ex-vessel could affect demand for party/charter associated with the three species gross revenue associated with boat trips. However, party/charter combined in 2004 compared to 2003 is Alternative 3 is distributed equally activity in the 1990s has remained approximately $6.1 million (assuming between the vessels that landed that relatively stable, so the effects may be 2002 ex-vessel prices) under the species in 2002, the average increase in minimal. Currently, neither behavioral Preferred Alternative. If this amount is gross revenue per vessel associated with or demand data are available to estimate distributed equally among the 1,041 Alternative 3 would be $7,748 for how sensitive party/charter boat anglers vessels that landed summer flounder, summer flounder, $6,005 for scup, and might be to proposed fishing scup, and/or black sea bass in 2002, the $3,032 for black sea bass. The number regulations. Overall, it is expected that average increase in revenue would be of vessels landing summer flounder, positive social and economic impacts approximately $5,842 per vessel. scup, and black sea bass in 2002 was would occur as a result of the The Council’s analysis of the harvest 796, 499, and 736, respectively. 21-percent increase in the recreational limits of Alternative 2 (i.e., the most The overall increase in gross revenue harvest limit, relative to 2003. The restrictive harvest limits) indicated that associated with the three species Council intends to recommend specific these harvest limits would produce a combined in 2004 compared to 2003 is measures to attain the 2004 summer revenue increase for 371 commercial approximately $11.4 million (assuming flounder recreational harvest limit in vessels, primarily because a large 2002 ex-vessel prices) under Alternative December 2003, and will provide proportion of their revenues were 3. If this amount is distributed equally additional analysis of the measures derived from black sea bass, and a among the 1,041 vessels that landed upon submission of its revenue loss for the other 670 summer flounder, scup, and/or black recommendations in early 2004. commercial vessels expected to be sea bass in 2002, the average increase in impacted by this rule. Assuming 2002 revenue would be approximately Scup recreational landings declined ex-vessel prices as described above, the $10,947 per vessel. over 89 percent for the period 1991 to 2004 quotas in Alternative 2 (after The Council also prepared an analysis 1998, then increased by 517 percent overages have been applied) would of the alternative recreational harvest from 1998 to 2000. In 2002, recreational increase total summer flounder and limits. The 2004 recreational harvest landings were 3.62 million lb (1,642 black sea bass revenues by limits were compared with previous mt). Under Preferred Alternative 1 (the approximately $6,600 and $400,000, years through 2002, the most recent year status quo alternative), the adjusted respectively, and decrease total scup with complete recreational data. scup recreational harvest limit for 2004 revenues by approximately $2.7 million, Landing statistics from the last several would be 3.99 million lb (1,810 mt), less relative to 2003 revenues. years show that recreational summer than 1 percent lower than the 2003 Assuming that the total ex-vessel flounder landings have generally recreational harvest limit, and gross revenue associated with exceeded the recreational harvest limits, represents a 10-percent increase from Alternative 2 is distributed equally ranging from a 5-percent overage in 2002 recreational landings. The among the vessels that landed that 1993 to a 122-percent overage in 2000. Alternative 2 scup recreational harvest species in 2002, the average change in In 2001, summer flounder recreational limit of 2.78 million lb (1,261 mt) for gross revenue per vessel associated with landings were 11.64 million lb (5,280 2004 would be 31 percent less than the Alternative 2 would be an $8 increase mt), exceeding the harvest limit of 7.16 2003 recreational harvest limit, and 23 for summer flounder, a $5,343 decrease million lb (3,248 mt) by 63 percent. In percent less than 2002 recreational for scup, and a $611 increase for black 2002, recreational landings were 7.96 landings. The Alternative 3 scup sea bass. The number of vessels landing million lb (3,611 mt), 18 percent below recreational harvest limit of 5.20 million summer flounder, scup, and black sea the recreational harvest limit of 9.72 lb (2,359 mt) in 2004 would be an bass in 2002 was 796, 499, and 736, million lb (4,409 mt). increase of 30 percent from the 2003 respectively. For summer flounder, the adjusted recreational harvest limit and an The overall reduction in gross 2004 preferred recreational harvest limit increase of 44 percent from 2002 revenue associated with the three of 11.21 million lb (5,085 mt) in recreational landings. With Alternative species combined in 2004 compared to Alternative 1 would be greater than the 2, and possibly Alternative 1, more 2003 is approximately $2.2 million recreational harvest limits for the years restrictive management measures might (assuming 2002 ex-vessel prices) under 1993 through 2003. The adjusted be required to prevent anglers from Alternative 2. If this amount is summer flounder Alternative 2 exceeding the 2003 recreational harvest distributed equally among the 1,041 recreational harvest limit of 9.25 million limit, depending largely upon the vessels that landed summer flounder, lb (4,196 mt) (the status quo alternative) effectiveness of the 2003 recreational scup, and/or black sea bass in 2002, the would be less than 1 percent lower than management measures. As described average decrease in revenue would be the 2003 recreational harvest limit, and above for the summer flounder fishery, approximately $2,123 per vessel. represents a 16-percent increase from the effect of greater restrictions on scup The Council’s analysis of the harvest 2002 recreational landings. The adjusted party/charter boats is unknown at this limits of Alternative 3 (i.e., the least Alternative 3 recreational harvest limit time. Although the proposed restrictive harvest limits) indicated that of 11.97 million lb (5,430 mt) would be recreational harvest limit is these harvest limits would produce a a 29-percent increase from the 2003 approximately 20,000 lb (9.07 mt) less

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00030 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66792 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

than the adjusted limit for 2003, it is not proposed 2004 GRA Access Program. ice, food and water, lumpers fees, likely that more effort controls (e.g., bag The costs would include gear changes to supplies, consignment fees, and other limits) will be required to constrain accommodate mesh modifications and expenses). More detail on the surveys is 2004 recreational landings. Overall, fees for at-sea observer coverage; the presented in Amendment 13 to the positive social and economic impacts benefits would be derived from an Summer Flounder, Scup, and Black Sea are expected to occur as a result of the increase in Loligo squid landings. Thus, Bass FMP. scup recreational harvest limit for 2004. positive economic impacts on the Loligo The utilization of the proposed VMS The Council intends to recommend squid fishery would be expected relative system under the GRA Access Program specific measures to attain the 2004 to the GRA measure without the small may substantially increase operating scup recreational harvest limit in mesh experimental net provision. costs and decrease profits for vessels December 2003, and will provide However, in order to participate in the that elect to participate in the program. additional analysis of the measures 2004 GRA Access Program, vessels Nevertheless, participation in this upon submission of its would have to comply with new program is not mandatory and it is recommendations early in 2004. requirements that are analyzed below. expected that individual vessels will Black sea bass recreational landings All vessels participating in the GRA assess changes in costs and revenues to increased slightly from 1991 to 1995. Access Program must have installed on their operations before they participate Landings decreased considerably from board an operational VMS unit. VMS is in this program. If a vessel owner 1996 to 1999, and then substantially a comprehensive information system chooses to participate in the program, it increased in 2000. In 2001 and 2002, that serves as an important enforcement is likely that the additional costs of recreational landings were 3.42 million and catch monitoring tool, and has been carrying an observer and using the lb (1,551 mt) and 4.46 million lb (2,023 in place in New England for the past modified gear would be offset by mt), respectively. For the recreational several years for Atlantic sea scallops, increased landings of non-exempt fishery, the adjusted 2004 harvest limit Northeast multispecies, and Atlantic species (Loligo squid, silver hake under Alternative 1 is 4.01 million lb herring. In New England, this type of (whiting), and black sea bass). As such, (1,558 mt), a 2-percent increase from the system has been employed to replace an increase in Loligo landings relative to 2003 recreational harvest limit and a 10- the Days-at-Sea call-in system, provide 2003 would have positive economic percent decrease from 2002 recreational accurate location data, and provide impacts on the Loligo fishery, relative to landings. Under Alternative 2, the 2004 information used in other analyses. the status quo. However, it is not recreational harvest limit would be 3.40 VMS requirements are located at 50 CFR possible to assess the exact monetary million lb (1,542 mt), a less than 1- 648.9. value associated with the additional percent decrease from the 2003 It is estimated that the initial harvest because quantitative data on recreational harvest limit and a 23- maximum cost of a VMS to vessel these nets are limited. percent decrease from 2002 recreational owners will be approximately $5,000 to The cost of one at-sea observer day for landings. As such, this alternative could $6,000 per vessel. The annual a NMFS-certified observer is cause some negative economic impacts maintenance fee for the VMS system is approximately $1,150, which would be due to decreased fishing opportunity, approximately $1,800 per vessel. Based paid by the vessel owner intending to depending upon the effectiveness of the on the number of vessels that had fish in the GRAs. Fishing trips to the 2002 recreational black sea bass directed Loligo squid trips (i.e., greater Southern GRA are expected to last measures. The 2004 recreational harvest than 50 percent of the total landings approximately 4 days, and trips to the limit under Alternative 3 would be 4.47 were Loligo squid) in the GRAs (1996– Northern GRA are expected to last million lb (2,027 mt), a 30-percent 1999) it is expected that up to 72 vessels approximately 3 days. Therefore, the increase from the 2003 recreational may participate in this program. The total observer costs are estimated to be harvest limit and a less than 1-percent VMS monitoring system currently $4,600 and $3,450 for trips in the decrease from 2002 recreational employed by NMFS to monitor vessel Southern and Northern GRAs, landings. Alternative 3 would likely activity for the Atlantic Sea Scallop respectively. The observer costs would result in positive economic impacts on FMP, Northeast Multispecies FMP, and be in addition to operating costs. The the recreational fishery because of an Atlantic Herring FMP is expected to be average ex-vessel value (1996–1999) of increase in fishing opportunities. The sufficient to monitor additional vessel Loligo in directed trips in the Southern Council intends to recommend specific activity (up to 72 more vessels) GRA is $24,013 and in the Northern measures to attain the 2004 black sea proposed under the GRA Access GRA was $4,456. These values are based bass recreational harvest limit in Program. Therefore, the implementation on the average landings of Loligo from December 2003, and will provide of the VMS system under the GRA 1996–1999 in the GRAs, and the average additional analysis of the measures Access Program is not expected to ex-vessel value (1996–1999) of Loligo, upon submission of its increase government costs. adjusted to 2001 dollars. Therefore, the recommendations early in 2004. A survey of small Northeast fishing requirement to carry at-sea observers Overall, positive social and economic vessels (less than 65 feet in length) would increase vessel operating costs. impacts are expected to occur as a result whose primary gear was otter trawl and However, larger vessels fishing in the of the preferred black sea bass reported landings in New England Southern GRA would be most likely to recreational harvest limit for 2004. indicated that average total operating recoup any increased operating costs The costs and benefits of allowing cost per trip for small trawlers in 1996 due to their greater harvest capacity. small mesh experimental nets to fish in was $267. A survey of large Northeast The observer requirement is anticipated the GRAs under the GRA Exemption fishing vessels (greater than 65 feet in to impose a larger negative impact on Program were described in the proposed length) whose primary gear was otter the profits of vessels fishing in the rule (67 FR 70904, , 2002) trawl and reported landings in New Northern GRA given the average ex- and the final rule (68 FR 60, January 2, England in 1997 indicated that the vessel value of Loligo in directed trips, 2003) implementing the 2003 average total operating cost per trip for as described above. However, as specifications. Those impacts are not large trawlers in 1997 was $2,608. For described above, because only limited repeated here. These costs and benefits both surveys, trip expenses were information must be collected under the could also be realized under the divided into eight categories (fuel, oil, GRA Access Program, NMFS is

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00031 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66793

proposing to use approved scup GRA The final rule to implement that landed scup in 2002), this could monitors rather than NMFS-certified Framework 3 to the FMP (68 FR 62250, result in a loss of potential revenue of observers. This likely would reduce the November 3, 2003) implemented a approximately $212 per vessel. Changes costs associated with data collection for process, for years in which the full in the scup recreational harvest limit as each participating vessel. Individual Winter I commercial scup quota is not a result of the RSA allocation would be vessels would need to assess changes in harvested, to allow unused quota from insignificant. The 160,000-lb (73-mt) costs and revenues upon their the Winter I period to be rolled over to RSA would reduce the scup recreational operations before participating in the the quota for the Winter II period. In any harvest limit from 4.03 million lb (1,828 non-mandatory Scup GRA Access year that NMFS determines that the mt) to 3.99 million lb (1,812 mt). It is Program. An analysis of Vessel Trip landings of scup during Winter I are less unlikely that scup recreational Report (VTR) data (1996–1999) indicates than the Winter I quota for that year, possession, size, or seasonal limits that, on average, 72 vessels had directed NMFS will, through a notification in the would change as the result of the RSA Loligo trips (i.e., greater than 50 percent Federal Register, increase the Winter II allocation. of the total landings were Loligo) in the quota for that year by the amount of the The black sea bass RSA allocation in GRAs, for a total of 209 trips. Assuming Winter I underharvest, and adjust the the Preferred Alternative, if made that all of these vessels choose to fish Winter II possession limits consistent available to the commercial fishery, the same number of trips in the GRAs, with the amount of the quota increase, could be worth as much as $233,190 a 100-percent observer requirement based on the possession limits dockside, based on a 2002 ex-vessel would mean that approximately 209 established through the annual price of $1.73/lb. Assuming an equal trips would be required to carry specifications-setting process. reduction in fishing opportunity for all observers in the GRAs. The actual total Framework 3 allows for the transfer of active commercial vessels (i.e., the 736 number of trips required to carry an unused scup quota from Winter I to vessels that caught black sea bass in observer would vary, depending upon Winter II period. A complete 2002), this could result in a loss of the individual decisions of vessel description and impact analysis of the approximately $317 per vessel. Changes owners regarding the potentially provision allowing the rollover of in the black sea bass recreational harvest increased profitability of fishing in the unused quota from Winter I to Winter II limit as a result of the RSA allocation GRAs versus additional observer costs. period is found in Framework 3. Overall would be insignificant. The 134,792-lb it is anticipated that allowing the (61-mt) RSA would reduce the black sea The proposed (status quo) commercial transfer of unused quota from Winter I scup possession limits for Winter I bass recreational harvest limit from 4.08 to Winter II period will result in million lb (1,851 mt) to 4.01 million lb (15,000 lb (6.8 mt) per trip) and Winter positive economic and social impacts to II (1,500 lb (680 kg) per trip) were (1,819 mt). It is unlikely that the black fishermen and communities as quota sea bass possession, size, or seasonal chosen as an appropriate balance not landed in Winter I due to poor between the economic concerns of the limits would change as the result of this weather conditions, changes in the RSA allocation. industry (e.g., landing enough scup to distribution of scup, or market Overall, long-term benefits are make the trip economically viable) and conditions (i.e., low price) will not be expected as a result of the RSA program the need to ensure the equitable lost. In addition, any scup regulatory due to improved fisheries data and distribution of the quota over the discards which have occurred in Winter information. If the total amount of quota period. The proposed Winter I II (i.e., when the fishery closes early) possession limit was selected can be converted into landings. set-aside is not awarded for any of the specifically to coordinate with the The summer flounder RSA allocation three fisheries, the unused set-aside 15,000 lb (6.8 mt) per week possession in the Preferred Alternative, if made amount will be restored to the limits recommended by the Commission available to the commercial fishery, appropriate fishery’s TAL. to be implemented by most states while could be worth as much as $263,873 In summary, the 2004 commercial satisfying concerns about enforcement dockside, based on a 2002 ex-vessel quotas and recreational harvest limits of possession limits. Changes in price of $1.51/lb. Assuming an equal contained in the Preferred Alternative possession limits can impact reduction in fishing opportunity among would result in substantially higher profitability in various ways. These all active vessels (i.e., the 796 vessels summer flounder and black sea bass impacts would vary depending on that landed summer flounder in 2002), landings and a small increase in scup fishing practices. These possession this could result in a loss in potential landings, relative to 2003. The proposed limits are expected to constrain revenue of approximately $331 per specifications contained in the Preferred commercial landings to the commercial vessel. Changes in the summer flounder Alternative were chosen because they TAL, and distribute landings equitably recreational harvest limit as a result of allow for the maximum level of throughout the periods to avoid derby- the 174,750-lb (79-mt) RSA are not landings, yet still achieve the fishing style fishing effort and associated expected to be significant. The RSA mortality and exploitation targets market gluts. According to anecdotal would reduce the recreational harvest specified in the FMP. While the information potential price fluctuations limit from 11.28 million lb (5,117 mt) to commercial quotas and recreational occur as result of irregular supply. The 11.21 million lb (5,085 mt). It is unlikely harvest limits specified in Alternative 3 recommended possession limits for that the recreational possession, size, or would provide for even larger increases Winter I would allow fishermen to seasonal limits would change as the in landings and revenues, they would determine when the best time for them result of the RSA allocation. not achieve the fishing mortality and to fish and further help to avoid market The scup RSA allocation in the exploitation targets specified in the gluts and unsafe fishing practices. Preferred Alternative, if made available FMP. Because the Council determined that the to the commercial fishery, could be The proposed possession limits for status quo scup possession limits worth as much as $105,600 dockside, scup were chosen in part because they minimize negative economic impacts on based on a 2002 ex-vessel price of are intended to provide for the industry, alternatives to the $0.66/lb. Assuming an equal reduction economically viable fishing trips that proposed possession limits were not in fishing opportunity for all active will be equitably distributed over the analyzed. commercial vessels (i.e., the 499 vessels entire quota period.

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00032 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66794 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

The economic effects of the existing ways to enhance the quality, utility, and section, except for vessels participating GRAs will not change as a result of this clarity of the information to be in the Gear Restricted Area Access proposed rule. The proposed action collected; and ways to minimize the Program as specified in paragraph (d) of would allow small-mesh vessels to fish burden of the collection of information, this section, must fish with nets that for non-exempt species in the GRAs including through the use of automated have a minimum mesh size of 4.5 inches until a pre-determined level of scup collection techniques or other forms of (11.43 cm) diamond mesh, applied discards is reached to trigger a closure information technology. Send comments throughout the codend for at least 75 to small mesh gear. Although the Scup on these or any other aspects of the continuous meshes forward of the GRA Access Program does impose collection of information to Patricia A. terminus of the net. For codends with additional voluntary compliance and Kurkul (see ADDRESSES), and by e-mail fewer than 75 meshes, the minimum- operating costs, this alternative is _ to David [email protected], or fax mesh-size codend must be a minimum expected to minimize both the reporting to (202) 395–7285. of one-third of the net, measured from burden on small entities and the Notwithstanding any other provision administrative support required of of the law, no person is required to the terminus of the codend to the NMFS to oversee the program. The respond to, nor shall any person be headrope, excluding any turtle excluder intent of the observer coverage is to subject to penalty for failure to comply device extension, unless otherwise record data regarding the use and with, a collection of information subject specified in this section. The Southern effectiveness of any gear modifications to the requirements of the PRA, unless Gear Restricted Area is an area bounded employed by the observed vessels in that collection of information displays a by straight lines connecting the attempts to reduce scup bycatch, and currently valid OMB Control Number. following points in the order stated also to monitor scup discards so that the (copies of a chart depicting the area are GRA Exemption Program can be List of Subjects in 50 CFR Part 648 available from the Regional discontinued when the trigger is Fisheries, Fishing, Reporting and Administrator upon request): reached. recordkeeping requirements. Finally, the revenue decreases Dated: November 21, 2003. SOUTHERN GEAR RESTRICTED AREA associated with the RSA program are John Oliver, expected to be minimal, and are Point N. Lat. W. Long. expected to yield important long-term Deputy Assistant Administrator for Operations, National Marine Fisheries ° ′ ° ′ benefits associated with improved Service. SGA1 ...... 39 20 72 50 ° ′ ° ′ fisheries data. It should also be noted For the reasons set out in the SGA2 ...... 39 20 72 25 that fish harvested under the RSAs SGA3 ...... 38°00′ 73°55′ preamble, 50 CFR part 648 is proposed ° ′ ° ′ would be sold, and the profits would be to be amended as follows: SGA4 ...... 37 00 74 40 used to offset the costs of research. As SGA5 ...... 36°30′ 74°40′ such, total gross revenue to the industry PART 648—FISHERIES OF THE SGA6 ...... 36°30′ 75°00′ would not decrease if the RSAs are NORTHEASTERN UNITED STATES SGA7 ...... 37°00′ 75°00′ utilized. SGA8 ...... 38°00′ 74°20′ This proposed rule contains 1. The authority citation for part 648 SGA1 ...... 39°20′ 72°50′ collection-of-information requirements continues to read as follows: subject to review and approval by OMB Authority: 16 U.S.C. 1801 et seq. (b) * * * under the Paperwork Reduction Act 2. In § 648.14, paragraph (a)(122) is (PRA). These requirements have been (1) Restrictions. From November 1 revised to read as follows: submitted to OMB for approval. Public through December 31, all trawl vessels reporting burden for these collections of § 648.14 Prohibitions. in the Northern Gear Restricted Area I that fish for or possess non-exempt information, including time for (a) * * * reviewing instructions, searching (122) Fish for, catch, possess, retain or species as specified in paragraph (b)(2) existing data sources, gathering and land Loligo squid, silver hake, or black of this section, except for vessels maintaining the data needed, and sea bass in or from the areas and during participating in the Gear Restricted Area completing and reviewing the collection the time periods described in Access Program as specified in of information, is estimated to average 5 § 648.122(a) or (b) while in possession paragraph (d) of this section, must fish seconds per response for automatically- of any trawl nets or netting that do not with nets that have a minimum mesh transmitted data from a VMS meet the minimum mesh restrictions or size of 4.5 inches (11.43 cm) diamond (transmitted 24 times per day), 10 that are obstructed or constricted as mesh, applied throughout the codend minutes per response for the daily specified in § 648.122 and § 648.123(a), for at least 75 continuous meshes transmission of discard data collected unless the nets or netting are stowed in forward of the terminus of the net. For by the scup GRA monitor, 2 minutes per accordance with § 648.23(b), or unless codends with fewer than 75 meshes, the response for a request for GRA the vessel is in compliance with the minimum-mesh-size codend must be a authorization, 2 minutes for a Gear Restricted Area Access Program minimum of one-third of the net, notification at least 5 days prior to requirements specified at § 648.122(d). measured from the terminus of the departing on a fishing trip to a GRA, and 3. In § 648.122, paragraphs (a)(1), 2 minutes for a report declaring into the codend to the headrope, excluding any (b)(1), and (d) are revised to read as turtle excluder device extension, unless fishery on the day the vessel leaves port follows: to fish under the GRA Access Program. otherwise specified in this section. The Public comment is sought regarding § 648.122 Time and area restrictions. Northern Gear Restricted Area I is an whether this proposed collection of (a) * * * area bounded by straight lines information is necessary for the proper (1) Restrictions. From January 1 connecting the following points in the performance of the functions of the through March 15, all trawl vessels in order stated (copies of a chart depicting agency, including whether the the Southern Gear Restricted Area that the area are available from the Regional information shall have practical utility; fish for or possess non-exempt species Administrator upon request): the accuracy of the burden estimate; as specified in paragraph (a)(2) of this

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00033 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66795

NORTHERN GEAR RESTRICTED AREA I (3) The vessel has installed on board for each day beginning at 0000 hours an operational VMS unit that meets the and ending at 2400 hours. The reports Point N. Lat. W. Long. requirements specified in § 648.9; must be submitted by 0900 hours of the (4) In addition to the above advance following day and must include the ° ′ ° ′ NGA1 ...... 41 00 71 00 notice for accessing a GRA, a vessel following information: NGA2 ...... 41°00′ 71°30′ owner or operator must notify NMFS of ° ′ ° ′ (i) Total pounds/kilograms of scup NGA3 ...... 40 00 72 40 his/her intention to fish in the GRA at NGA4 ...... 40°00′ 72°05′ discarded. NGA1 ...... 41°00′ 71°00′ least 5 working days prior to the date he/she intends to depart on each trip (ii) [Reserved] (7) A vessel which does not have a * * * * * into a GRA. For each of these reports, a vessel owner or operator must submit valid Coast Guard Inspection Sticker is (d) Gear Restricted Area Access the following information: Vessel name deemed inadequate or unsafe for Program—Vessels that are subject to the and permit number; owner and purposes of carrying a NMFS-approved provisions of the Southern and Northern operator’s names; owner and operator’s GRA monitor and will be prohibited Gear Restricted Areas, as specified in phone numbers; date and time of from participating in the GRA Access paragraphs (a) and (b) of this section, departure; port of departure; and the Program until the vessel is inspected by respectively, may fish for, or possess, specific GRA to be fished; the Coast Guard and receives its non-exempt species using trawl nets (5) On the day that the vessel leaves inspection sticker; having a minimum mesh size less than port to fish under the GRA Access (8) The vessel owner will be that specified in paragraphs (a) and (b) Program, the vessel owner or operator responsible for paying the cost of the of this section, provided that: must declare the vessel into the GRA GRA monitor; and (1) The vessel possesses on board all Access Program, in accordance with valid required Federal fishery permits (9) The GRA Access Program for each instructions to be provided by the GRA will end when the discard of scup and a Scup GRA Access Program Regional Administrator prior to the Authorization issued by the Regional is projected to be 50,000 lb (22.68 mt) vessel leaving port; for the Northern GRA and 70,000 lb Administrator, Northeast Region, and is (6) The owner or operator of a vessel (31.75 mt) for the Southern GRA. in compliance with all conditions and with a GRA Access Authorization Termination of the GRA Access Program restrictions specified in the Scup GRA submit reports through the VMS, in for each area will be made through Access Program Authorization; accordance with instructions to be notification in the Federal Register and (2) The vessel carries a NMFS- provided by the Regional Administrator, notification of vessel operators by fax. approved scup GRA monitor on board if for each day fished when declared into any portion of the trip will be, or is, in the GRA Access Program. The reports [FR Doc. 03–29598 Filed 11–26–03; 8:45 am] a GRA; must be submitted in 24-hour intervals, BILLING CODE 3510–22–P

VerDate jul<14>2003 14:24 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00034 Fmt 4702 Sfmt 4702 E:\FR\FM\28NOP1.SGM 28NOP1 66796

Notices Federal Register Vol. 68, No. 229

Friday, November 28, 2003

This section of the FEDERAL REGISTER Dated: November 21, 2003. COMMITTEE FOR PURCHASE FROM contains documents other than rules or Marcia R. Andre, PEOPLE WHO ARE BLIND OR proposed rules that are applicable to the Forest Supervisor, Gila National Forest. SEVERELY DISABLED public. Notices of hearings and investigations, [FR Doc. 03–29635 Filed 11–26–03; 8:45 am] committee meetings, agency decisions and Procurement List Additions and rulings, delegations of authority, filing of BILLING CODE 3410–11–M Deletions petitions and applications and agency statements of organization and functions are AGENCY: Committee for Purchase from examples of documents appearing in this DEPARTMENT OF AGRICULTURE People Who Are Blind or Severely section. Disabled. Forest Service ACTION: Additions to and Deletions from Procurement List. DEPARTMENT OF AGRICULTURE Notice of Resource Advisory Committee Meeting Forest Service SUMMARY: This action adds to the Procurement List products and a service Catron County Resource Advisory AGENCY: Lassen Resource Advisory to be furnished by nonprofit agencies Committee Committee, Susanville, California, employing persons who are blind or USDA Forest Service. have other severe disabilities, and deletes from the Procurement List AGENCY: Forest Service, USDA. ACTION: Notice of meeting. products previously furnished by such ACTION: Notice of meeting. agencies. SUMMARY: Pursuant to the authorities in SUMMARY: The Catron County Resource the Federal Advisory Committees Act EFFECTIVE DATE: , 2003. Advisory Committee will meet in (Pub. L. 92–463) and under the Secure ADDRESSES: Committee for Purchase Reserve, New Mexico, on , Rural Schools and Community Self- From People Who Are Blind or Severely 2003, at 10 a.m. MST. The purpose of Determination Act of 2000 (Pub. L. 106– Disabled, Jefferson Plaza 2, Suite 10800, the meeting is to discuss use of project 393) the Lassen National Forest’s Lassen 1421 Jefferson Davis Highway, proposal form, establish process for County Resource Advisory Committee Arlington, Virginia 22202–3259. project submission, evaluate submitted will meet Wednesday, December 10, FOR FURTHER INFORMATION CONTACT: projects and select projects for 2003, and Thursday, , 2003 Sheryl D. Kennerly, (703) 603–7740. recommendation. in Susanville, California for business SUPPLEMENTARY INFORMATION: meetings. The meetings are open to the DATES: The meeting will be held Additions December 8, 2003. public. On August 29, and , 2003, ADDRESSES: The meeting will be held at SUPPLEMENTARY INFORMATION: The the Committee for Purchase From the Catron County Courtroom of the meeting December 10th begins at 9 a.m., People Who Are Blind or Severely Catron County Court House, 101 Main at the Eagle Lake Ranger District Office, Disabled published notice (68 FR 51962 Street, Reserve, New Mexico 87830. 477–050 Eagle Lake Road, Susanville, and 57403) of proposed additions to the Send written comments to Michael CA 96130. The meeting objectives are Procurement List. Gardner, Catron County Resource for RAC members and the public to hear After consideration of the material Advisory Committee, c/o Forest Service, project presentations from proponents. presented to it concerning capability of USDA, 3005 E. Camino del Bosque, The meeting on December 11th begins at qualified nonprofit agencies to provide Silver City, New Mexico 88061–7863 or 9 a.m. at the Eagle Lake Ranger District the products and service and impact of electronically to [email protected]. Office, 477–050 Eagle Lake Road, the additions on the current or most FOR FURTHER INFORMATION CONTACT: Susanville, CA 96130. Agenda topics recent contractors, the Committee has Michael Gardner, Rural Community will include: Selection of proposed RAC determined that the products and Assistant Staff, Gila National Forest, projects, develop January meeting service listed below are suitable for (505) 388–8212. agenda, and meeting calendar for 2004. procurement by the Federal Government Time will also be set aside for public under 41 U.S.C. 46–48c and 41 CFR 51– SUPPLEMENTARY INFORMATION: The comments at the end of the meeting. 2.4. meeting is open to the public. Committee discussion is limited to FOR FURTHER INFORMATION: Contact Regulatory Flexibility Act Certification Forest Service staff and Committee Robert Andrews, Eagle Lake District I certify that the following action will members unless provided for on the Ranger and Designated Federal Officer, not have a significant impact on a agenda. However, persons who wish to at (530) 257–4188; or RAC Coordinator, substantial number of small entities. bring Pub. L. 106–393 related matters to Heidi Perry, at (530) 252–6604. The major factors considered for this the attention of the Committee may file certification were: written statements with the Committee Edward C. Cole, 1. The action will not result in any Staff before or after the meeting. Public Forest Supervisor. additional reporting, recordkeeping or input sessions will be provided and [FR Doc. 03–29714 Filed 11–26–03; 8:45 am] other compliance requirements for small individuals may address the committee BILLING CODE 3410–11–M entities other than the small at times provided on the agenda in the organizations that will furnish the morning and afternoon. products and service to the Government.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66797

2. The action will result in Product/NSN: PURELL/SKILCRAFT The major factors considered for this authorizing small entities to furnish the Wall Dispenser, 4510–00–NIB–0005, certification were: products and service to the Government. 1000 mL, 4510–00–NIB–0006, 1000 mL. 1. The action may result in any 3. There are no known regulatory NPA: Travis Association for the Blind, additional reporting, recordkeeping or alternatives which would accomplish Austin, Texas. other compliance requirements for small the objectives of the Javits-Wagner- Contract Activity: Office Supplies & entities. O’Day Act (41 U.S.C. 46–48c) in Paper Products Acquisition Center, New 2. The action may result in connection with the products and York, New York. authorizing small entities to furnish the service proposed for addition to the Product/NSN: Hydration On-the- products to the Government. Procurement List. Move System, 8465–00–NIB–0071, 3. There are no known regulatory Bravo 70 oz Woodland, 8465–00–NIB– alternatives which would accomplish End of Certification 0072, Bravo 70 oz Desert, 8465–00–NIB– the objectives of the Javits-Wagner- Accordingly, the following products 0073, Bravo 70 oz Black Night Ops, O’Day Act (41 U.S.C. 46–48c) in and service are added to the 8465–00–NIB–0074, Delta 100 oz connection with the products deleted Procurement List: Woodland, 8465–00–NIB–0075, Delta from the Procurement List. 100 oz Desert, 8465–00–NIB–0076, Delta End of Certification Products 100 oz Black Night Ops, 8465–00–NIB– Product/NSN: CD/DVD Label Kit and 0077, Alpha 120 oz Woodland, 8465– Accordingly, the following products Refills, 7530–00–NIB–0660 (Kit), 7530– 00–NIB–0078, Alpha 120 oz Desert, are deleted from the Procurement List: 00–NIB–0688 (Refill). 8465–00–NIB–0079, Alpha 120 oz Black Products NPA: North Central Sight Services, Night Ops, 8465–00–NIB–0092, Warrior Inc., Williamsport, Pennsylvania. 100 oz Woodland, 8465–00–NIB–0093, Product/NSN: Cleaner, Water Soluble, Contract Activity: Office Supplies & Warrior 100 oz Desert, 8465–00–NIB– 6840–01–367–2913, 7930–01–367–2964, Paper Products Acquisition Center, New 0094, Warrior 100 oz Black Night Ops, 7930–01–367–2967, 7930–01–367–2968, York, New York. 8465–00–NIB–0095, Sierra 100 oz 7930–01–367–2970. NPA: Association for the Blind & Product/NSN: Dustpan and Brush Set, Woodland, 8465–00–NIB–0096, Sierra Visually Impaired & Goodwill Industries M.R. 1020. 100 oz Desert, 8465–00–NIB–0097, Sierra 100 oz Black Night Ops. of Greater Rochester, Rochester, New NPA: The Lighthouse for the Blind, York. Inc. (Seattle Lighthouse), Seattle, Product/NSN: Canteen, One Quart, Flexible, 8465–00–NIB–0041, Echo 1 qt. Contract Activity: GSA, Southwest Washington. Supply Center, Fort Worth, Texas. Contract Activity: Defense NPA: The Lighthouse for the Blind, Commissary Agency (DeCA), Ft. Lee, Inc. (Seattle Lighthouse), Seattle, Product/NSN: Clipboard File, 7520– VA. Washington. 01–439–3404. Contract Activity: Office Supplies & NPA: Industries of the Blind, Inc., Product/NSN: GOJO/SKILCRAFT Hair Paper Products Acquisition Center, New Greensboro, North Carolina. & Body Shampoo, 8520–00–NIB–0028, York, New York. Contract Activity: Office Supplies & 800 mL, 8520–00–NIB–0029, 2000 mL, Paper Products Acquisition Center, New Service 8520–00–NIB–0066, 1000 mL. York, New York. Product/NSN: GOJO/SKILCRAFT Service Type/Location: Grounds Sheryl D. Kennerly, Lotion Hand Soap, 8520–00–NIB–0012, Maintenance, Darnall Army Community 12 oz., 8520–00–NIB–0024, 800 mL, Hospital/Clinics (Buildings 420, 2242, Director, Information Management. 8520–00–NIB–0025, 2000 mL, 8520–00– 2245, 2255, 2250, 7015, 9440, 56503, [FR Doc. 03–29709 Filed 11–26–03; 8:45 am] NIB–0065, 1000 mL. 4222, 33001, 33003, 39033, 4441, 4909, BILLING CODE 6353–01–P Product/NSN: GOJO/SKILCRAFT 76022, 90043, 36000, 36001, 36007, Natural Orange Hand Cleaner with 36014, 36017), Fort Hood, Texas. NPA: Professional Contract Services, Pumice, 8520–00–NIB–0069, .5 Gal, DEPARTMENT OF COMMERCE Inc., Austin, Texas. 8520–00–NIB–0070, 1 Gal. Contract Activity: III Corps and Fort Submission for OMB Review; Product/NSN: MICRELL/SKILCRAFT Hood Contracting Command, Fort Hood, Comment Request Antibacterial Hand Soap, 8520–00–NIB– Texas. 0010, 800 mL, 8520–00–NIB–0027, 2000 The Department of Commerce has mL, 8520–00–NIB–0067, 1000 mL. Deletions submitted to the Office of Management and Budget (OMB) for clearance the Product/NSN: PURELL/SKILCRAFT On October 3, 2003, the Committee following proposal for collection of Instant Hand Sanitizer, 8520–00–NIB– for Purchase From People Who Are information under the provisions of the 0008, 800 mL, 8520–00–NIB–0017, 2 Blind or Severely Disabled published Paperwork Reduction Act (44 U.S.C. oz., 8520–00–NIB–0058, 1000 mL. notice (68 FR 57403/57404) of proposed deletions to the Procurement List. After Chapter 35). Product/NSN: PURELL/SKILCRAFT consideration of the relevant matter Agency: National Institute of Instant Hand Sanitizer with Aloe, 8520– presented, the Committee has Standards and Technology (NIST). 00–NIB–0060, 4.25 oz., 8520–00–NIB– determined that the products listed Title: National Voluntary Laboratory 0061, 12 oz., 8520–00–NIB–0062, 800 below are no longer suitable for Accreditation Program (NVLAP) mL, 8520–00–NIB–0063, 1000 mL. procurement by the Federal Government Information Collection System. Product/NSN: GOJO/SKILCRAFT under 41 U.S.C. 46–48c and 41 CFR 51– Form Number(s): None. Wall Dispenser, 4510–00–NIB–0001, 2.4. OMB Approval Number: 0693–0003. 800 mL, 4510–00–NIB–0002, 2000 mL, Type of Review: Regular submission. 4510–00–NIB–0003, 1000 mL, 4510–00– Regulatory Flexibility Act Certification Burden Hours: 2,338. NIB–0007, 1000 mL., 4510–00–NIB– I certify that the following action will Number of Respondents: 850. 0008, 800 mL, 4510–00–NIB–0009, 2000 not have a significant impact on a Average Hours Per Response: 2.75 mL. substantial number of small entities. hours.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66798 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Needs and Uses: This information is Survey of Plant Capacity Utilization. We MA333M Refrigeration, Air collected from all laboratories, testing have determined that annual data Conditioning, and Warm Air and calibration, that apply for NVLAP collected from these surveys are needed Equipment accreditation. It is used by NVLAP to to aid the efficient performance of MA333P Pumps and Compressors assess laboratory conformance with essential governmental functions and MA334B Selected Instruments and applicable criteria as defined in 15 CFR have significant application to the needs Related Products part 285, section 285.14. An accredited of the public and industry. The data MA334M Consumer Electronics laboratory’s contact information and derived from these surveys, most of MA334P Communication Equipment scope of accreditation are published which have been conducted for many MA334Q Semiconductors, Printed annually in the NVLAP Directory of years, are not publicly available from Circuit Boards, and Electronic Accredited Laboratories, and quarterly nongovernmental or other governmental Components MA334R Computers and Office and on NVLAP’s Web site. The information sources. Accounting Machines provides a service to customers in FOR FURTHER INFORMATION CONTACT: MA334S Electromedical and business and industry, including William G. Bostic, Jr., Chief, Irradiation Equipment regulatory agencies and purchasing Manufacturing and Construction MA335A Switchgear, Switchboard authorities that are seeking competent Division, on (301) 763–4593. Apparatus, Relays, and Industrial laboratories to perform testing and SUPPLEMENTARY INFORMATION: The Controls calibration services. Census Bureau is authorized to conduct MA335E Electric Housewares and Affected Public: Business or other for- surveys necessary to furnish current Fans profit organizations, not-for-profit data on the subjects covered by the MA335F Major Household Appliances institutions, and Federal, State or Local major censuses authorized by Title 13, MA335H Motors and Generators government. United States Code (U.S.C.), sections 61, MA335J Insulated Wire and Cable Frequency: Annually. MA335K Wiring Devices and Supplies Respondent’s Obligation: Required to 81, 182, 193, 224, and 225. These surveys will provide continuing and The following list of surveys obtain or retain benefits. represents annual counterparts of OMB Desk Officer: Jacqueline Zeiher, timely national statistical data on manufacturing for the period between monthly and quarterly surveys and will (202) 395–4638. cover only those establishments that are Copies of the above information economic censuses. The next economic not canvassed, or do not report, in the collection proposal can be obtained by censuses will be conducted for the year more frequent surveys. Accordingly, calling or writing Diana Hynek, 2007. The data collected in these there will be no duplication in Departmental Paperwork Clearance surveys will be within the general scope reporting. The content of these annual Officer, (202) 482–0266, Department of and nature of those inquiries covered in reports will be identical with that of the Commerce, Room 6625, 14th and the economic censuses. monthly and quarterly reports. Constitution Avenue, NW., Washington, Current Industrial Reports DC 20230 (or via the Internet at Survey Title Most of the following commodity or [email protected]). M311H Animal and Vegetable Fats Written comments and product surveys provide data on shipments or production, stocks, and Oils (Stocks) recommendations for the proposed M311J Oilseeds, Beans, and Nuts unfilled orders, orders booked, information collection should be sent (Primary Producers) within 30 days of publication of this consumption, and so forth. Reports will M311L Fats and Oils (Renderers) notice to Jacqueline Zeiher, OMB Desk be required of all, or a sample of, M311M Animal and Vegetables Fats Officer. establishments engaged in the and Oils (Consumption and Stocks) production of the items covered by the Dated: November 21, 2003. M311N Animal and Vegetables Fats following list of surveys: Gwellnar Banks, and Oils (Production, Consumption, Management Analyst, Office of the Chief Survey Title and Stock) Information Officer. M313P Consumption on the Cotton MA313F Yarn Production System [FR Doc. 03–29625 Filed 11–26–03; 8:45 am] MA313K Knit Fabric Production M313N Cotton and Raw Linters in BILLING CODE 3510–13–P MA314Q Carpets and Rugs Public Storage MA315D Gloves and Mittens M327G Glass Containers MA316A Footwear Production M331J Inventories of Steel Producing DEPARTMENT OF COMMERCE MA321T Lumber Production and Mill Mills M336G Civil Aircraft and Aircraft Bureau of the Census Stocks MA325F Paint and Allied Products Engines [Docket Number 031119282–3282–01] MA325G Pharmaceutical Preparations, MQ311A Flour Milling Products except Biologicals MQ313D Consumption on the Woolen Annual Surveys in the Manufacturing MA327C Refractories System and Worsted Combing Area MA327E Consumer, Scientific, MQ313T Broadwoven Fabrics (Gray) MQ314X Bed and Bath Furnishings AGENCY: Census Bureau, Commerce. Technical, and Industrial Glassware MA331A Iron and Steel Castings MQ315A Apparel ACTION: Notice of determination. MQ325A Inorganic Chemicals MA331B Steel Mill Products MQ325B Fertilizer Materials SUMMARY: The Bureau of the Census MA331E Nonferrous Castings MQ325C Industrial Gases (Census Bureau) is conducting the 2003 MA332Q Antifriction Bearings MQ327D Clay Construction Products Annual Surveys in the Manufacturing MA333A Farm Machinery and Lawn MQ333W Metalworking Machinery Area. The 2003 Annual Surveys consist and Garden Equipment MQ335C Fluorescent Lamp Ballasts of the Current Industrial Reports MA333D Construction Machinery surveys, the Annual Survey of MA333F Mining Machinery and Annual Survey of Manufactures Manufactures, the Survey of Industrial Mineral Processing Equipment The Annual Survey of Manufactures Research and Development, and the MA333L Internal Combustion Engines collects industry statistics, such as total

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66799

value of shipments, employment, Development—3145–0027; and Survey The Census Bureau is authorized to payroll, workers’ hours, capital of Plant Capacity Utilization—0607– take surveys that are necessary to expenditures, cost of materials 0175. We will provide copies of each furnish current data on the subjects consumed, supplemental labor costs, form upon written request to the covered by the major censuses and so forth. This survey, conducted on Director, U.S. Census Bureau, authorized by Title 13, United States a sample basis, covers all manufacturing Washington, DC 20233–0001. Code, sections 182, 224, and 225. This industries, including data on plants Based upon the foregoing, I have survey will provide continuing and under construction but not yet in directed that the Annual Surveys in the timely national statistical data on retail operation. Manufacturing Area be conducted for trade for the period between economic Survey of Industrial Research and the purpose of collecting these data. censuses. For 2003, the survey will, as Development Dated: , 2003. it has in the past, operate as a separate Charles Louis Kincannon, sample of retail companies. The data The Survey of Industrial Research and collected in this survey will be similar Director, Bureau of the Census. Development measures spending on to that collected in the past and within research and development activities in [FR Doc. 03–29654 Filed 11–26–03; 8:45 am] the general scope and nature of those private U.S. businesses. The Census BILLING CODE 3510–07–P inquiries covered in the economic Bureau collects and compiles this census. These data will provide a sound information in accordance with a joint statistical basis for the formation of DEPARTMENT OF COMMERCE project between the National Science policy by various government agencies. Foundation (NSF) and the Census Bureau of the Census These data also apply to a variety of Bureau. The Census Bureau and the public and business needs. NSF publish the results in their Notwithstanding any other provision [Docket Number 031113278–3278–01] respective publication series. Five data of law, no person is required to respond items in the survey provide interim Annual Retail Trade Survey to, nor shall a person be subject to a statistics collected in the Census penalty for failure to comply with, a Bureau’s economic censuses. These AGENCY: Bureau of the Census, collection of information subject to the items (total company sales, total Commerce. requirements of the Paperwork employment, total expenditures for ACTION: Notice of determination. Reduction Act (PRA) unless that research and development conducted collection of information displays a within the company, federally-funded SUMMARY: The Bureau of the Census current valid Office of Management and expenditures for research and (Census Bureau) is conducting the Budget (OMB) control number. In development within the company, and Annual Retail Trade Survey. The accordance with the PRA, 44 United total expenditures and federally-funded Census Bureau has determined that it States Code, Chapter 35, the OMB expenditures for research and needs to collect data covering annual approved the Annual Retail Trade development within the company by sales, e-commerce sales, percent of e- Survey under OMB Control Number state) are collected on a mandatory basis commerce sales to customers located 0607–0013. We will furnish report under the authority of Title 13, U.S.C. outside the United States, year-end forms to organizations included in the Responses to all other data collected are inventories, purchases, accounts survey. Additional copies are available voluntary. receivables, and, for select industries, on written request to the Director, U.S. Survey of Plant Capacity Utilization merchandise line sales and percent of Census Bureau, Washington, DC 20233– sales by class of customer. The Survey of Plant Capacity 0101. Utilization is designed to measure the FOR FURTHER INFORMATION CONTACT: Based upon the foregoing, I have use of industrial capacity. The survey Nancy Piesto, Service Sector Statistics directed that an annual survey be collects information on actual output Division, on (301) 763–2747. conducted for the purpose of collecting and estimates of potential output in SUPPLEMENTARY INFORMATION: The these data. terms of value of production. These data Annual Retail Trade Survey is a Dated: November 24, 2003. are the basis for calculating rates of continuation of similar retail trade Charles Louis Kincannon, utilization of full production capability surveys conducted each year since 1951 Director, Bureau of the Census. and use of production capability under (except 1954). It provides on a [FR Doc. 03–29653 Filed 11–26–03; 8:45 am] national emergency conditions. comparable classification basis, annual BILLING CODE 3510–07–P Notwithstanding any other provision sales, e-commerce sales, and purchases of law, no person is required to respond for 2003 and year-end inventories for to, nor shall a person be subject to a 2002 and 2003. These data are not DEPARTMENT OF COMMERCE penalty for failure to comply with, a available publicly on a timely basis from collection of information subject to the nongovernmental or other governmental International Trade Administration requirements of the Paperwork sources. Reduction Act (PRA) unless that The Census Bureau will require a Initiation of Antidumping and collection of information displays a selected sample of firms operating retail Countervailing Duty Administrative current valid Office of Management and establishments in the United States Reviews Budget (OMB) control number. In (with sales size determining the AGENCY: Import Administration, accordance with the PRA, 44 U.S.C., probability of selection) to report in the International Trade Administration, chapter 45, the OMB approved the 2003 2003 Annual Retail Trade Survey. We Department of Commerce. Annual Surveys under the following will furnish report forms to the firms ACTION: Notice of initiation of OMB Control Numbers: Current covered by this survey and will require antidumping and countervailing duty Industrial Reports—0607–0206, 0607– their submissions within 30 days after administrative reviews. 0392, 0607–0395, and 0607–0476; receipt. The sample will provide, with Annual Survey of Manufactures—0607– measurable reliability, statistics on the SUMMARY: The Department of Commerce 0449; Survey of Industrial Research and subjects specified above. (the Department) has received requests

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66800 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

to conduct administrative reviews of U.S. Department of Commerce, 14th countervailing duty orders and findings various antidumping and countervailing Street and Constitution Avenue, NW., with October anniversary dates. duty orders and findings with October Washington, DC 20230, telephone: (202) Initiation of Reviews anniversary dates. In accordance with 482–4737. the Department’s regulations, we are SUPPLEMENTARY INFORMATION: In accordance with 19 CFR initiating those administrative reviews. 351.221(c)(1)(i), we are initiating Background EFFECTIVE DATE: November 28, 2003. administrative reviews of the following FOR FURTHER INFORMATION CONTACT: The Department has received timely antidumping and countervailing duty Holly A. Kuga, Office of AD/CVD requests, in accordance with 19 CFR orders and findings. We intend to issue Enforcement, Import Administration, 351.213(b)(2002), for administrative the final results of these reviews not International Trade Administration, reviews of various antidumping and later than October 31, 2004.

Period to be reviewed

Antidumping Duty Proceedings Brazil: Carbon and Certain Alloy Steel Wire Rod, A–351–832 ...... 4/15/02–9/30/03 Companhia Siderurgica Belgo Mineira Belgo Mineira Participacoes Industria e Comercio S.A. BMP Siderurgia S.A. Canada: Carbon and Certain Alloy Steel Wire Rod, A–122–840 ...... 4/10/02–9/30/03 Ivaco Inc. Mexico: Carbon and Certain Alloy Steel Wire Rod, A–201–830 ...... 4/10/02–9/30/03 Hylsa Puebla, S.A. de C.V. Hylsamex, S.A. de C.V. Siderurgica Lazaro Cardenas Las Truchas S.A. de C.V. Spain: Stainless Steel Wire Rod,1 A–469–807 ...... 9/1/02–8/31/03 Roldan, S.A. The People’s Republic of China: Helical Spring Lock Washers,2 A–570–822 ...... 10/1/02–9/30/03 Hang Zhou Spring Washer Co., Ltd./(dba Zhejiang Wanxin Group Co., Ltd.) Trinidad and Tobago: Carbon and Certain Alloy Steel Wire Rod, A–274–804 ...... 4/10/02–9/30/03 Caribbean Ispat Limited Countervailing Duty Proceedings Brazil: Carbon and Certain Alloy Steel Wire Rod, C–351–833 ...... 8/30/02–12/31/02 Companhia Siderurgica Belgo Mineira Belgo Mineira Participacoes Industria e Comercio S.A. BMP Siderurgia S.A. Canada: Carbon and Certain Alloy Steel Wire Rod, C–122–841 ...... 2/8/02–12/31/02 Ispat Sidbec Inc. Suspension Agreements None. 1 Inadvertently omitted from previous initiation notice. 2 If one of the above-named companies does not qualify for a separate rate, all other exporters of helical spring lock washers from the Peo- ple’s Republic of China who have not qualified for a separate rate are deemed to be covered by this review as part of the single PRC entity of which the named exporters are a part.

During any administrative review Interested parties must submit DEPARTMENT OF COMMERCE covering all or part of a period falling applications for disclosure under between the first and second or third administrative protective orders in International Trade Administration and fourth anniversary of the accordance with 19 CFR 351.305. [A–570–884] publication of an antidumping duty These initiations and this notice are order under § 351.211 or a in accordance with section 751(a) of the Notice of Preliminary Determination of determination under § 351.218(f)(4) to Tariff Act of 1930, as amended (19 Sales at Less Than Fair Value, continue an order or suspended U.S.C. 1675(a)), and 19 CFR Postponement of Final Determination, investigation (after sunset review), the 351.221(c)(1)(i). and Affirmative Preliminary Secretary, if requested by a domestic Determination of Critical Dated: , 2003. interested party within 30 days of the Circumstances: Certain Color date of publication of the notice of Holly A. Kuga, Television Receivers From the initiation of the review, will determine Acting Deputy Assistant Secretary, Group II People’s Republic of China whether antidumping duties have been for Import Administration. AGENCY: Import Administration, absorbed by an exporter or producer [FR Doc. 03–29720 Filed 11–26–03; 8:45 am] International Trade Administration, subject to the review if the subject BILLING CODE 3510–DS–P Department of Commerce. merchandise is sold in the United States through an importer that is affiliated ACTION: Notice of preliminary with such exporter or producer. The determination of sales at less than fair value. request must include the name(s) of the exporter or producer for which the SUMMARY: We preliminarily determine inquiry is requested. that certain color television receivers

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66801

from the People’s Republic of China are Also on , 2003, we issued an in the United States. For further being, or are likely to be, sold in the antidumping questionnaire to the discussion, see the June 25, 2003, United States at less than fair value, as Chinese Ministry of Commerce memorandum from Shawn Thompson provided in section 733(b) of the Tariff (MOFCOM) requesting that it forward to the file entitled ‘‘Telephone Act of 1930, as amended. In addition, the questionnaire to Chinese producers/ Conversation with a Third Country we preliminarily determine that there is exporters accounting for all known Exporter in the Antidumping Duty a reasonable basis to believe or suspect exports of subject merchandise from the Investigation of Certain Color Television that critical circumstances exist with PRC during the period of investigation Receivers from the People’s Republic of respect to imports of subject (POI). The Department also sent China.’’ merchandise from the People’s Republic courtesy copies of the antidumping On June 30, 2003, an additional PRC of China. questionnaire to the China Chamber of exporter of CTVs, Shenzhen Chaungwei- Interested parties are invited to Commerce for Import & Export of RGB Electronics Co., Ltd. (Skyworth), comment on this preliminary Machinery & Electronic Products, to all contacted the Department and requested determination. We will make our final companies identified in U.S. customs that it be issued a copy of the determination not later than 135 days data as exporters of the subject questionnaire. We provided a copy to after the date of publication of this merchandise during the POI with Skyworth on July 1, 2003. preliminary determination. shipments in commercial quantities, From through , 2003, we EFFECTIVE DATE: November 28, 2003. and to any additional companies received responses to section A of the FOR FURTHER INFORMATION CONTACT: Irina identified in the petition as exporters of questionnaire from the following Itkin or Elizabeth Eastwood, Office of CTVs. These companies included: Gain exporters: Changhong, Haier, Hisense, AD/CVD Enforcement, Office 2, Import Star International Ltd. (Gain Star); Konka, Philips, Skyworth, Starlight Administration, International Trade Guangdong Stationery & Sporting Goods International Holdings, Ltd. (the parent Administration, U.S. Department of Import & Export Corporation company of Star Light, Star Fair Commerce, 14th Street and Constitution (Guangdong Stationery); Haier Electric Electronics Co. Ltd., and Starlight Avenue, NW., Washington, DC 20230; Appliances International Co. (Haier); Marketing Development Ltd.), SVA, telephone: (202) 482–0656 or (202) 482– Hisense Import and Export Co., Ltd. TCL, and XOCECO. We did not receive 3874, respectively. (Hisense); Konka Group Company, Ltd. properly-filed section A responses from (Konka); New Great Wall Digital any other company.1 Preliminary Determination Electronics Co.; Philips Consumer On , 2003, Changhong We preliminarily determine that Electronics Co. of Suzhou Ltd. (Philips); requested that the Department find that certain color television receivers (CTVs) Sichuan Changhong Electric Co., Ltd. the CTV industry in the PRC is a from the People’s Republic of China (Changhong); Sanyo Sales & Marketing market-oriented industry (MOI). On July (PRC) are being sold, or are likely to be Corp.; Shanghai SVW DD and TT 21, 2003, the Department notified sold, in the United States at less than Electronic Enterprise Co., Ltd.; Star Changhong that its MOI claim must be fair value (LTFV), as provided in section Light Electronics Co., Ltd. (Star Light); made on behalf of the CTV industry as 733 of the Tariff Act of 1930, as Supra Corporation (Supra); SVA Group a whole, rather than on behalf of a amended (the Act). The estimated Co., Ltd. (SVA); TCL Holding Company specific exporter. Also on July 21, 2003, margins of sales at LTFV are shown in Ltd. (TCL); and Xiamen Overseas the petitioners submitted a letter in the ‘‘Suspension of Liquidation’’ section Chinese Electornic Co., Ltd. (XOCECO). which they opposed Changhong’s claim of this notice. In addition, we The letters sent to MOFCOM and that the CTVs industry is market- preliminarily determine that there is a individual exporters provided deadlines oriented. reasonable basis to believe or suspect for responses to the different sections of On July 22, 2003, pursuant to section that critical circumstances exist with the questionnaire. 777A(c) of the Act, the Department respect to CTVs from all exporters in the On , 2003, XOCECO requested determined that, due to the large PRC. The critical circumstances analysis that high definition televisions (HDTVs) number of exporters of the subject for the preliminary determination is be excluded from the scope of this merchandise, it would limit the number discussed below under the section investigation. For further discussion, see of mandatory respondents in this ‘‘Critical Circumstances.’’ the ‘‘Scope Comments’’ section of this investigation. Therefore, we selected notice, below. Changhong, Konka, TCL, and XOCECO Case History On , 2003, we issued a as the mandatory respondents, in Since the initiation of this courtesy copy of the questionnaire to XS addition to the PRC government. The investigation (Notice of Initiation of Cargo, an additional exporter of PRC Department also issued a separate Antidumping Duty Investigations: CTVs to the United States. memorandum concerning those Certain Color Television Receivers From Also on June 24, 2003, Guangdong exporters and producers who submitted Malaysia and the People’s Republic of Stationery informed the Department that a complete response to section A of the China, 68 FR 32013 (, 2003)) it did not export subject merchandise to questionnaire and the conditions under (Initiation Notice), the following events the United States during the POI. For which they may be considered for have occurred: On June 16, 2003, the further discussion, see the June 24, treatment other than inclusion in the United States International Trade 2003, memorandum from Jill Pollack to rate applicable to the government- Commission (ITC) preliminarily the file entitled ‘‘Placing Information on controlled enterprise. For further determined that there is a reasonable the Record in the Antidumping Duty indication that imports of certain color Investigation on Color Television 1 In July 2003, we also received improperly-filed televisions from Malaysia and the section A responses from Gain Star and Supra. Receivers from the People’s Republic of Neither company responded to our request to file People’s Republic of China are China (PRC).’’ its response properly, despite the fact that we materially injuring the United States On June 25, 2003, XS Cargo informed afforded each an additional opportunity to do so industry. See ITC Investigation Nos. the Department that it also did not and we provided explicit instructions as to how to export subject merchandise to the file properly; therefore, we have returned these 731–TA–1034 and 1035 (Certain Color responses to Gain Star and Supra and will not Television Receivers from China and United States during the POI, but consider these responses for purposes of this Malaysia, 68 FR 38089 (, 2003)). merely returned broken sets purchased proceeding.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66802 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

discussion, see the ‘‘Respondent information to support the MOI claim On October 31, 2003, Changhong Selection’’ section of this notice, below, made in this case. submitted a request regarding its MOI and the July 22, 2003, memorandum On , 2003, we notified claim, stating that before making its from the team to the file entitled Changhong, Philips, TCL, and XOCECO final determination in this case, the ‘‘Antidumping Duty Investigation of that their MOI claim did not sufficiently Department should identify any Certain Color Television Receivers from address the three prongs of the additional specific MOI information the People’s Republic of China— Department’s MOI test, and that, as a required from the PRC CTVs producers. Selection of Respondents’’ (the consequence, we were unable to On , 2003, the ‘‘Respondent Selection memo’’). See conclude that the experiences of the petitioners submitted additional also the ‘‘Margins for Exporters Whose firms making the claim are surrogate value information. Although Responses Were Not Analyzed’’ section representative of the industry. In the this information was received too late of this notice, below. letter, we provided further guidance as for use in the preliminary On , 2003, the Department to what was necessary for an MOI determination, we will consider it for invited interested parties to comment on investigation. Copies of this letter were use in the final determination. surrogate country selection and to also provided to Haier, Skyworth, and Also on November 10, 2003, Konka provide publicly available information the PRC government. requested that the Department postpone On September 16, 2003, Changhong, for valuing the factors of production. the final determination until 135 days Haier, Philips, TCL, and XOCECO On , 2003, the petitioners after the publication of the preliminary responded to the petitioners’ , submitted comments opposing determination. For further discussion, XOCECO’s June 18, 2003, scope 2003, comments on the MOI issue. On , 2003, pursuant to see the ‘‘Postponement of Final exclusion request. Determination’’ section of this notice. During July and August 2003, we section 733(c)(2) of the Act and 19 CFR issued supplemental section A 351.205(f), the Department determined Postponement of Final Determination questionnaires to each of the four that the case was extraordinarily complicated and postponed the Section 735(a)(2) of the Act provides mandatory participating respondents in that a final determination may be this case (i.e., Changhong, Konka, TCL, preliminary determination until no later than November 21, 2003. See postponed until not later than 135 days and XOCECO) as well as to each of the after the date of the publication of the exporters not selected as mandatory Postponement of Preliminary Determinations of Antidumping Duty preliminary determination if, in the respondents which properly filed a event of an affirmative preliminary section A response. We received Investigations: Certain Color Television Receivers From Malaysia (A–557–812) determination, a request for such responses to these questionnaires in postponement is made by exporters who August 2003. and the People’s Republic of China (A– 570–884), 68 FR 55372 (Sept. 25, 2003). account for a significant proportion of From through August 22, exports of the subject merchandise, or in 2003, we received responses to the From October 3 through November 3, 2003, the petitioners submitted the event of a negative preliminary remaining sections of the questionnaire determination, a request for such from the four participating mandatory additional surrogate value information. Changhong provided comments on postponement is made by the petitioner. respondents, as well as two exporters The Department’s regulations, at 19 CFR who requested to be examined on a certain of these submissions on , October 31, and November 6, 2003. 351.210(e)(2), require that requests by voluntary basis (i.e., Haier and Philips). respondents for postponement of a final On , 2003, Changhong, Also on October 16, 2003, the determination be accompanied by a Philips, TCL, and XOCECO submitted petitioners alleged that critical request for extension of provisional additional information related to the circumstances exist with respect to measures from a four-month period to claim that the CTVs industry in the PRC imports of CTVs from the PRC. not more than six months. is market-oriented.2 Accordingly, pursuant to section 732(e) From August 18 through , of the Act, on , 2003, we On November 10, 2003, Konka, which 2003, we issued supplemental requested information from Changhong, represents a significant proportion of questionnaires to Changhong, Konka, Konka, TCL, and XOCECO regarding exports, requested that the Department TCL, and XOCECO. We received monthly shipments to the United States postpone its final determination until responses to these questionnaires from during the period January 2001 through 135 days after the publication of the through October 31, 2003. October 2003. We received the preliminary determination. Konka also On August 22, 2003, the petitioners requested information on October 31 included a request to extend the responded to the respondents’ August and November 3, 2003. The critical provisional measures to not more than 12, 2003, MOI submission. Also on circumstances analysis for the six months. Accordingly, since we have August 22, 2003, the petitioners preliminary determination is discussed made an affirmative preliminary submitted information on surrogate below under ‘‘Critical Circumstances.’’ determination and no compelling values. On , 2003, Skyworth On October 24 and October 31, 2003, reasons for denial exist, we have submitted company-specific Changhong submitted additional postponed the final determination until information to support the MOI claim information related to surrogate values. not later than 135 days after the made in this case. Also on September 5, On , 2003, we issued an publication of the preliminary 2003, we received information related to additional supplemental questionnaire determination. to Changhong. We received surrogate values from Changhong, Period of Investigation Philips, and TCL, as well as comments Changhong’s responses to this on surrogate country selection from questionnaire on November 10, 2003, Pursuant to 19 CFR 351.204(b)(1), the Haier. and November 12, 2003. Although these POI for an investigation involving On , 2003, Haier responses were received too late for use merchandise from a non-market submitted company-specific in the preliminary determination, we economy (NME) is the two most recent intend to verify this information and fiscal quarters prior to the month of the 2 Changhong provided additional documentation consider it for use in the final filing of the petition (i.e., May 2002). supporting this claim on , 2003. determination. Therefore, in this case, the POI is

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66803

October 1, 2002, through March 31, fundamental characteristics—that is producer’s factors of production, valued 2003. they are capable of receiving a broadcast in a comparable market economy that is signal and displaying a video image. a significant producer of comparable Scope of Investigation Therefore, we conclude that all CTVs, merchandise. The sources of individual For purposes of this investigation, the including HDTVs, are appropriately factor prices are discussed under the term ‘‘certain color television receivers’’ included in the scope of this ‘‘Normal Value’’ section of the notice, includes complete and incomplete investigation, and constitute a single below. direct-view or projection-type cathode- class or kind of merchandise. For a No party in this investigation has ray tube color television receivers, with further discussion, see the November requested a revocation of the PRC’s a video display diagonal exceeding 52 21, 2003, memorandum to Louis Apple, NME status. We have, therefore, centimeters, whether or not combined Director, Office 2 from the team entitled preliminarily continued to treat the PRC with video recording or reproducing ‘‘Scope Exclusion Request.’’ as an NME. apparatus, which are capable of receiving a broadcast television signal Respondent Selection Market Oriented Industry and producing a video image. In June 2003, the Department On July 15, 2003, Changhong Specifically excluded from this designated the PRC government as the requested that the Department make a investigation are computer monitors or mandatory respondent in this case and determination that the CTV industry in other video display devices that are not issued it the questionnaire for the PRC is an MOI. Changhong capable of receiving a broadcast distribution to appropriate parties. The submitted certain company-specific data television signal. Department also sent courtesy copies of in support of its request. On July 21, The color television receivers subject the questionnaire to PRC companies 2003, the petitioners submitted a letter to this investigation are currently which the Department identified as in which they opposed Changhong’s classifiable under subheadings exporters/producers of subject claim that the CTVs industry is market- 8528.12.2800, 8528.12.3250, merchandise. oriented. Specifically, the petitioners 8528.12.3290, 8528.12.4000, In July 2003, we received section A stated that Changhong has not provided 8528.12.5600, 8528.12.3600, responses from 12 producers/exporters evidence to support its claim that the 8528.12.4400, 8528.12.4800, and of CTVs in the PRC. Each of these majority of its material inputs are 8528.12.5200 of the Harmonized Tariff exporters requested to be selected as a valued at market prices. The petitioners Schedule of the United States (HTSUS). respondent in this case and requested a also stated that Changhong has not Although the HTSUS subheading is separate rate. In addition, we received provided evidence to rebut allegations provided for convenience and customs information from two additional that the PRC government regulates purposes, the written description of the companies issued a questionnaire prices in the CTV industry, and that scope of the merchandise under indicating that they did not export CTVs CTV producers in the PRC have been investigation is dispositive. to the United States during the POI. We assisted by direct government did not receive responses from the involvement in financing, advertising, Scope Comments remaining companies who were sent labor, utilities, currency exchange, and In accordance with the preamble to courtesy copies of the questionnaire. government ownership of CTV- our regulations (see Antidumping On July 22, 2003, the Department producing companies. Duties; Countervailing Duties, 62 FR determined that it did not have the Also on July 21, 2003, the Department 27296, 27323 (May 19, 1997)), we set resources to investigate all producers/ notified Changhong that its MOI claim aside a period of time for parties to raise exporters of the subject merchandise must be made on behalf of the CTV issues regarding product coverage and requesting a separate rate. Rather, we industry as a whole, rather than on encouraged all parties to submit found that it was practicable to examine behalf of a specific exporter. On August comments within 20 calendar days of a maximum of four producers/exporters. 12, 2003, Changhong, Konka, Philips, publication of the Initiation Notice (see Therefore, we selected as mandatory TCL, and XOCECO submitted additional 68 FR at 32013). Interested parties respondents in this case the four information related to the claim that the submitted such comments by June 18, companies with the largest export CTVs industry in the PRC is market- 2003. volumes during the POI (i.e., oriented. On August 22, 2003, the Pursuant to the Department’s Changhong, Konka, TCL, and XOCECO). petitioners responded to this solicitation of scope comments in the For further discussion, see the submission. In their August 22, 2003, Initiation Notice, XOCECO requested Respondent Selection memo. submission, the petitioners stated that that HDTVs be excluded from the scope the respondents’ August 12, 2003, of this investigation because: (1) These Nonmarket Economy Country Status submission did not provide data on CTVs are produced by the petitioners The Department has treated the PRC substantially all of the CTV industry in only in limited amounts; and (2) they as an NME country in all past the PRC and that the respondents did differ from the CTVs covered by the antidumping investigations. See, e.g., adequately address the allegations scope of the investigation in terms of Final Determination of Sales at Less contained in the petitioners’ July 21, physical characteristics, ultimate uses, Than Fair Value and Critical 2003, submission, i.e., that non-market purchaser expectations, channels of Circumstances: Certain Malleable Iron economy forces in the PRC have a trade, and the manner of advertising and Pipe Fittings From the People’s Republic significant impact on the CTV industry display. On July 31, 2003, the of China, 68 FR 61395, 61396 (Oct. 28, and distort the true cost of production. petitioners opposed this request. 2003). A designation as an NME remains On September 5 and September 9, After considering the respondent’s in effect until it is revoked by the 2003, Skyworth and Haier, respectively, comments and the petitioners’ Department. See section 771(18)(C) of submitted company-specific objections to XOCECO’s request the Act. information to support the MOI claim regarding HDTVs, we find that the CTVs When the Department is investigating made in this case. in question fall within the scope of this imports from an NME country, section On September 15, 2003, we notified investigation. All CTVs, including the 773(c)(1) of the Act directs us to base Changhong, Konka, Philips, TCL, and CTVs in question, have the same normal value (NV) on the NME XOCECO that their MOI claim did not

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66804 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

sufficiently address the three prongs of Separate Rates respondents can demonstrate the the Department’s MOI test (see below), In an NME proceeding, the absence of both de jure and de facto and that, as a consequence, we were Department presumes that all governmental control over export unable to conclude that the experiences companies within the country are activities. See Silicon Carbide and of the firms making the claim are subject to governmental control and Notice of Final Determination of Sales representative of the industry. Copies of should be assigned a single at Less Than Fair Value: Furfuryl this letter were also provided to Haier, antidumping duty rate unless the Alcohol from the People’s Republic of Skyworth, and the PRC government. On respondent demonstrates the absence of China, 60 FR 22544, 22545 (, September 16, 2003, Changhong, Haier, both de jure and de facto governmental 1995) (Furfuryl Alcohol). Philips, TCL, and XOCECO responded control over its export activities. See 1. Absence of De Jure Control to the petitioners’ August 22, 2003, Notice of Final Determination of Sales comments on the MOI issue, but they The Department considers the at Less Than Fair Value: Bicycles From following de jure criteria in determining did not address the Department’s the People’s Republic of China, 61 FR concerns. whether an individual company may be 19026, 19027–28 (Apr. 30, 1996) granted a separate rate: (1) An absence On October 31, 2003, Changhong (Bicycles). Changhong, Konka, TCL, of restrictive stipulations associated submitted a request regarding its MOI XOCECO, and the cooperative non- with an individual exporter’s business claim, stating that before making its selected exporters named in the and export licenses; (2) any legislative final determination in this case, the ‘‘Suspension of Liquidation’’ section enactments decentralizing control of Department should identify the specific below have provided the requested companies; and (3) any other formal MOI information required from the PRC company-specific separate rates measures by the government CTV producers. information and have indicated that decentralizing control of companies. there is no element of government In order to consider a MOI claim, the The mandatory respondents have ownership or control over their export Department requires information on placed on the record a number of operations. We have considered each of the three prongs of the MOI test documents to demonstrate absence of de whether the mandatory respondents are regarding the situation and experience jure control, including the ‘‘Law of the eligible for a separate rate as discussed of the PRC CTV industry as a whole. People’s Republic of China on Industrial below. Enterprises Owned By the Whole Specifically, the MOI test requires that: The Department’s separate rate test is (1) There be virtually no government People.’’ not concerned, in general, with In prior cases, the Department has involvement in production or prices for macroeconomic/ border-type controls analyzed these laws and found that they the industry; (2) the industry is marked (e.g., export licenses, quotas, and establish an absence of de jure control. by private or collective ownership that minimum export prices), particularly if See, e.g., Notice of Preliminary behaves in a manner consistent with these controls are imposed to prevent Determination of Sales at Less Than market considerations; and (3) dumping. The test focuses, rather, on Fair Value and Postponement of Final producers pay market-determined prices controls over the investment, pricing, Determination: Certain Partial- for all major inputs, and for all but an and output decision-making process at Extension Steel Drawer Slides With insignificant proportion of minor the individual firm level. See Notice of Rollers From the People’s Republic of inputs. Even in those cases where the Final Determination of Sales at Less China, 60 FR 29571, 29573 (, number of investigated firms is limited Than Fair Value: Certain Cut-to-Length 1995); 3 Notice of Final by the Department, a MOI allegation Carbon Steel Plate From Ukraine, 62 FR Determination of Sales at Less Than Fair must cover all (or virtually all) of the 61754, 61758–60 (Nov. 19, 1997); Value: Manganese Metal From the producers in the industry in question. Tapered Roller Bearings and Parts People’s Republic of China, 60 FR See Notice of Preliminary Determination Thereof, Finished and Unfinished, from 56045, 56046 (Nov. 6, 1995). We have of Sales at Less Than Fair Value and the People’s Republic of China; Final no new information in this proceeding Postponement of Final Determination: Results of Antidumping Duty which would cause us to reconsider this Synthetic Indigo From the People’s Administrative Review, 62 FR 61276, determination. Republic of China, 64 FR 69723, 69725 61279 (Nov. 17, 1997); and Notice of According to the mandatory (Dec. 14, 1999). See also Notice of Final Preliminary Determination of Sales at respondents, CTV exports are not Determination of Sales at Less Than Less than Fair Value: Honey from the affected by export licensing provisions Fair Value: Freshwater Crawfish Tail People’s Republic of China, 60 FR or export quotas. These respondents Meat From the People’s Republic of 14725, 14727 (Mar. 20, 1995). claim to have autonomy in setting the China, 62 FR 41347, 41353 (Aug. 1, To establish whether a firm is contract prices for sales of CTVs through 1997). sufficiently independent from independent price negotiations with As a threshold matter, we note that government control to be entitled to a their foreign customers without the respondents have not provided separate rate, the Department analyzes interference from the PRC government. information for the record that covers each exporting entity under a test Based on the assertions of the virtually all of the producers of the arising out of the Final Determination of respondents, we preliminarily industry. Rather, the respondents Sales at Less Than Fair Value: Sparklers determine that there is an absence of de provided certain data related to from the People’s Republic of China, 56 jure government control over the pricing companies which appear to be export- FR 20588, 20589 (May 6, 1991), as and marketing decisions of the oriented without demonstrating that this modified by Notice of Final respondents with respect to their CTV data applies equally to other CTV Determination of Sales at Less Than export sales. producers within the PRC. Because the Fair Value: Silicon Carbide from the MOI allegation made in this case has not People’s Republic of China, 59 FR 3 This was unchanged in the final determination. provided an adequate basis for 22585, 25586–87 (May 2, 1994) (Silicon See, Notice of Final Determination of Sales at Less Than Fair Value: Certain Partial-Extension Steel considering the three factors of the Carbide). Under the separate rates Drawer Slides with Rollers from the People’s Department’s MOI test, we are unable to criteria, the Department assigns separate Republic of China, 60 FR 54472, 54474 (Oct. 24, consider the MOI request. rates in NME cases only if the 1995).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66805

2. Absence of De Facto Control exporter is eligible for a separate rate, of CTVs failed to respond to our As stated in previous cases, there is we assigned a weighted-average of the questionnaire. As a result, use of facts some evidence that certain enactments rates of the fully analyzed companies, available (FA), pursuant to section of the PRC central government have not excluding any rates that were zero, de 776(a)(2)(A) of the Act, is appropriate. In selecting among the facts otherwise been implemented uniformly among minimis, or based entirely on facts available, section 776(b) of the Act different sectors and/or jurisdictions in available. See Notice of Final authorizes the Department to use the PRC. See Final Determination of Determination of Sales at Less Than adverse facts available (AFA) if the Sales at Less Than Fair Value: Certain Fair Value: Certain Circular Welded Carbon-Quality Steel Pipe from the Department finds that an interested Preserved Mushrooms from the People’s People’s Republic of China, 67 FR party failed to cooperate by not acting Republic of China, 63 FR 72255, 72256 36570, 36571 (May 24, 2002) (Welded to the best of its ability to comply with (Dec. 31, 1998). Therefore, the Steel Pipe). Companies receiving this the request for information. See, e.g., Department has determined that an rate are identified by name in the Bicycles, 61 FR at 19028; Notice of Final analysis of de facto control is critical in ‘‘Suspension of Liquidation’’ section of Determination of Sales at Less Than determining whether respondents are, this notice. Fair Value: Certain Cold-Rolled Flat- in fact, subject to a degree of Rolled Carbon-Quality Steel Products governmental control which would PRC-Wide Rate and Use of Facts From the Russian Federation, 65 FR preclude the Department from assigning Otherwise Available 5510, 5518 (Feb. 4, 2000). MOFCOM separate rates. As in all NME cases, the Department was notified in the Department’s The Department typically considers implements a policy whereby there is a questionnaire that failure to submit the four factors in evaluating whether each rebuttable presumption that all requested information by the date respondent is subject to de facto exporters or producers located in the specified might result in use of FA. The governmental control of its export NME comprise a single exporter under producers/exporters that decided not to functions: (1) Whether the export prices common government control, the ‘‘NME respond to the Department’s are set by, or subject to, the approval of entity.’’ The Department assigns a single questionnaire failed to act to the best of a governmental authority; (2) whether NME rate to the NME entity unless an their ability in this investigation. Absent the respondent has authority to exporter can demonstrate eligibility for a response, we must presume negotiate and sign contracts, and other a separate rate. government control of these companies. agreements; (3) whether the respondent Section 776(a)(2) of the Act provides The Department has determined, has autonomy from the government in that if an interested party or any other therefore, that in selecting from among making decisions regarding the person: (A) withholds information that the facts otherwise available an adverse selection of its management; and (4) has been requested by the administering inference pursuant to section 776(b) of whether the respondent retains the authority; (B) fails to provide such the Act is warranted. proceeds of its export sales and makes information by the deadline, or in the In accordance with our standard independent decisions regarding form or manner requested; (C) practice, as AFA, we are assigning as the disposition of profits or financing of significantly impedes a proceeding; or PRC-wide rate the higher of: (1) The losses. See Id. (D) provides such information that highest margin stated in the notice of The mandatory respondents have cannot be verified, the Department shall initiation (i.e., the recalculated petition asserted the following: (1) They use, subject to sections 782(d) and (e) of margin); or (2) the highest margin establish their own export prices; (2) the Act, facts otherwise available in calculated for any respondent in this they negotiate contracts without reaching the applicable determination. investigation. See, e.g., Notice of Final guidance from any governmental Pursuant to section 782(e) of the Act, Determination of Sales at Less Than entities or organizations; (3) they make the Department shall not decline to Fair Value: Certain Cold-Rolled Carbon their own personnel decisions; and (4) consider submitted information if all of Quality Steel Products from the People’s they retain the proceeds of their export the following requirements are met: (1) Republic of China, 65 FR 34660 (May sales and use profits according to their The information is submitted by the 31, 2000) and accompanying decision business needs. Additionally, the established deadline; (2) the information memorandum at Comment 1. In this respondents’ questionnaire responses can be verified; (3) the information is case, the preliminary AFA margin is indicate that they do not coordinate not so incomplete that it cannot serve as 78.45 percent, which is the highest with other exporters in setting prices or a reliable basis for reaching the margin stated in the notice of initiation. in determining which companies will applicable determination; (4) the See Initiation Notice, 68 FR at 32016. sell to which markets. This information interested party has demonstrated that it supports a preliminary finding that acted to the best of its ability; and (5) Corroboration of Information there is an absence of de facto the information can be used without Section 776(b) of the Act authorizes governmental control of the export undue difficulties. the Department to use AFA information functions of these companies. Information on the record of this derived from the petition, the final Consequently, we preliminarily investigation indicates that there are determination from the LTFV determine that the mandatory numerous producers/exporters of the investigation, a previous administrative respondents have met the criteria for the subject merchandise in the PRC. As review, or any other information placed application of separate rates. noted in the ‘‘Case History’’ section on the record. above, all exporters were given the Section 776(c) of the Act requires the Margins for Cooperative Exporters Not opportunity to respond to the Department to corroborate, to the extent Selected Department’s questionnaire. Based upon practicable, secondary information used For those exporters: (1) Who our knowledge of the PRC and the fact as FA. Secondary information is defined submitted a timely response to section that U.S. import statistics show that the as ‘‘[i]nformation derived from the A of the Department’s questionnaire, but responding companies did not account petition that gave rise to the were not selected as mandatory for all imports into the United States investigation or review, the final respondents, and (2) for whom the from the PRC, we have preliminarily determination concerning the subject section A response indicates that the determined that certain PRC exporters merchandise, or any previous review

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66806 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

under section 751 concerning the selected for the preliminary Specifically, Changhong’s questionnaire subject merchandise.’’ See Statement of determination differed from those used responses indicate that, for Changhong’s Administrative Action (SAA) in the petition, we compared the remaining market-economy carriers, accompanying the Uruguay Round petition margin calculations to the ocean freight was paid to a PRC Agreements Act, H.R. Doc. No. 103–316 calculations based on the selected company, not a market-economy at 870 (1994) and 19 CFR 351.308(d). surrogate values wherever possible and supplier. Therefore, we valued ocean The SAA clarifies that ‘‘corroborate’’ found they were reasonably close. freight expenses for Changhong’s means that the Department will satisfy Therefore, we preliminarily determine remaining market-economy carriers, as itself that the secondary information to that the petition information has well as its PRC carriers, using the be used has probative value. See the probative value. Accordingly, we find substantiated market-economy carrier’s SAA at 870. The SAA also states that that the highest margin stated in the rates. For further discussion, see the independent sources used to corroborate notice of initiation, 78.45 percent, is November 21, 2003, memorandum from such evidence may include, for corroborated within the meaning of Elizabeth Eastwood to the file entitled, example, published price lists, official section 776(c) of the Act. For further ‘‘U.S. Price and Factors of Production import statistics, customs data, and discussion, see the November 21, 2003, Adjustments for Sichuan Changhong information obtained from interested memorandum from the team to the file Electric Co., Ltd. for the Preliminary parties during the particular entitled ‘‘Corroboration of Data Determination.’’ investigation. See the SAA at 870. Contained in the Petition for Assigning Where appropriate, we adjusted the In order to determine the probative an Adverse Facts Available Rate.’’ values to reflect inflation up to the POI value of the margins in the petition for using the wholesale price indices (WPI) use as AFA for purposes of this Fair Value Comparisons or the purchase price indices (PPI) determination, we examined evidence To determine whether sales of CTVs published by the International Monetary supporting the calculations in the from the PRC were made at LTFV, we Fund (IMF), as appropriate. petition. We reviewed the adequacy and compared the EP or constructed export B. Konka accuracy of the information in the price (CEP) to the NV, as described in petition during our pre-initiation the ‘‘Export Price/Constructed Export For Konka, we used EP methodology analysis of the petition, to the extent Price,’’ and ‘‘Normal Value’’ sections of in accordance with section 772(a) of the appropriate information was available this notice, below. In accordance with Act because the subject merchandise for this purpose. See the , 2003, section 777A(d)(1)(A)(i) of the Act, we was sold directly to unaffiliated Initiation Checklist, on file in the compared POI-wide weighted-average customers in the United States prior to Central Records Unite (CRU), Room B– EPs and CEPs by product to the importation and CEP methodology was 099, of the Main Commerce Department appropriate product-specific NV. not otherwise appropriate. We based EP building, for a discussion of the margin on the packed FOB PRC port prices to calculations in the petition. In Export Price/Constructed Export Price unaffiliated purchasers in the United accordance with section 776(c) of the A. Changhong States, as appropriate. We made Act, to the extent practicable, we deductions for movement expenses, in examined the key elements of the export For Changhong, we used EP accordance with 772(c)(2)(A) of the Act; price (EP) and NV calculations on methodology in accordance with section these included, where appropriate, which the margins in the petition were 772(a) of the Act because the subject foreign inland freight and foreign based. merchandise was sold directly to brokerage and handling. As certain of In order to corroborate the petition’s unaffiliated customers in the United these movement services were provided EP calculations, we compared the prices States prior to importation and CEP by NME suppliers, we valued them in the petition for CTVs to the prices methodology was not otherwise using Indian rates. For further submitted by the mandatory appropriate. We based EP on the packed discussion of these values, see the respondents. In order to corroborate the FOB PRC port or CIF U.S. port prices to ‘‘Normal Value’’ section of this notice, petitioners’ NV calculation, we unaffiliated purchasers in the United below. compared the petitioners’ factor States, as appropriate. We made C. TCL consumption and/or surrogate value deductions for movement expenses, in data for CTVs to the data reported by the accordance with 772(c)(2)(A) of the Act; For TCL, we used EP methodology in respondents for the most significant these included, where appropriate, accordance with section 772(a) of the factors—color picture tubes (CPTs), foreign inland freight, foreign brokerage Act because the subject merchandise cabinets, woofer speakers, remotes with and handling, ocean freight, and marine was sold directly to unaffiliated tuners, other parts and components, insurance. As certain of these movement customers in the United States prior to electricity, factory overhead, selling, services were provided by NME importation and CEP methodology was general, and administrative (SG&A) suppliers, we valued them using Indian not otherwise appropriate. In expenses, profit, and packing rates. For further discussion of our use accordance with our practice, we expenses—and to surrogate values of surrogate data in an NME proceeding, excluded sales made to the United selected by the Department for the as well as selection of India as the States through a Japanese reseller as preliminary determination, as discussed appropriate surrogate country, see the well as a sample sale to the United below. ‘‘Normal Value’’ section of this notice, States from our analysis for purposes of As discussed in the November 21, below. the preliminary determination because 2003, memorandum from the team to With respect to ocean freight, they were made in small quantities. See, the file entitled ‘‘Corroboration of Data Changhong asserted that it used both e.g., Notice of Preliminary Contained in the Petition for Assigning PRC and market-economy suppliers for Determination of Sales at Less Than an Adverse Facts Available Rate,’’ we its shipments of CTVs. However, based Fair Value: Hot-Rolled Flat-Rolled found the U.S. price and factors of on Changhong’s submitted information, Carbon-Quality Steel Products from production information in the petition we could only establish that one of Japan, 64 FR 8291, 8295 (Feb. 19, 1999) to be reasonable and of probative value. Changhong’s market-economy carriers and Notice of Preliminary As a number of the surrogate values charged market-economy prices. Determination of Sales at Not Less Than

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66807

Fair Value: Pure Magnesium From the 772(d)(1) of the Act. Regarding warranty production. We have obtained and Russian Federation, 66 FR 21319, expenses, XOCECO twice failed to relied upon publicly available 21322–23 (Apr. 30, 2001). provide requested documentation information wherever possible. We based EP on the packed FOB PRC substantiating the breakdown of Factors of Production prices to unaffiliated purchasers in the warranty expenses between subject and United States. We made deductions for non-subject merchandise. As a result, In accordance with 19 CFR movement expenses, in accordance with we find that the use of FA, pursuant to 351.408(c)(1), the Department will 772(c)(2)(A) of the Act; these included, section 776(a)(2)(A) of the Act, is normally use publicly available where appropriate, foreign inland appropriate. Furthermore, since the information to value factors of freight and foreign brokerage and Department finds that XOCECO failed to production. However, the Department’s handling. As certain of these movement cooperate by not acting to the best of its regulations also provide that where a services were provided by NME ability to comply with the request for producer sources an input from a suppliers, we valued them using Indian information, an adverse inference is market economy and pays for it in rates. For further discussion of these warranted under section 776(b) of the market economy currency, the values, see the ‘‘Normal Value’’ section Act. As AFA, we applied the highest Department employs the actual price of this notice, below. reported model-specific warranty paid for the input to calculate the factors-based NV. Id.; see also Lasko D. XOCECO expense for every transaction during the POI. Metal Products v. United States, 43 F. For XOCECO, we used CEP Pursuant to section 772(d)(3) of the 3d 1442, 1445–1446 (Fed. Cir. 1994). methodology in accordance with section Act, we further reduced the starting Changhong, Konka, TCL, and XOCECO 772(b) of the Act, because sales to the price by an amount for profit to arrive reported that some of their inputs were first unaffiliated purchaser in the United at CEP. We calculated the CEP profit purchased from market economies and States took place after importation. We ratio for XOCECO based on the financial paid for in a market economy currency. calculated CEP based on ex-warehouse data reported in the income statements Where respondents were unable to or delivered prices to unaffiliated of three Indian producers of CTVs, BPL provide sufficient documentation that purchasers in the United States. We Limited (BPL), Onida Saka Limited certain inputs were purchased from made deductions for movement (Onida Saka), and Videocon market-economy suppliers, we valued expenses, in accordance with International Limited (Videocon) for the these inputs using surrogate values. In accordance with section 773(c) of 772(c)(2)(A) of the Act; these included, year ended 2002. where appropriate, foreign inland the Act, we calculated NV based on freight, foreign brokerage and handling, Normal Value factors of production reported by each ocean freight, marine insurance, U.S. respondent for the POI. To calculate NV, A. Surrogate Country inland freight, U.S. warehousing, other the reported per-unit factor quantities U.S. transportation expenses, U.S. Section 773(c)(4) of the Act requires were multiplied by publicly available customs brokerage fees and duties in the Department to value an NME Indian surrogate values. For purposes of accordance with section 772(c)(2)(A) of producer’s factors of production, to the calculating NV, we valued PRC factors the Act. For freight services provided by extent possible, in one or more market of production, in accordance with market-economy companies and paid economy countries that: (1) Are at a section 773(c)(1) of the Act. Factors of for in a market currency, we used the level of economic development production include, but are not limited actual prices which XOCECO paid to comparable to that of the NME country, to: (1) Hours of labor required; (2) the freight supplier in our CEP and (2) are significant producers of quantities of raw materials employed; calculation. Where these movement comparable merchandise. The (3) amounts of energy and other utilities services were provided by NME Department has determined that India, consumed; and (4) representative capital suppliers, we valued them using Indian Pakistan, Indonesia, Sri Lanka, and the cost, including depreciation. In rates. Philippines are countries comparable to examining surrogate values, we Regarding U.S. warehousing and other the PRC in terms of overall economic selected, where possible, the publicly U.S. transportation expenses, XOCECO development. See the , 2003, available value which was: (1) an attempted to respond to our requests for memorandum from Ron Lorentzen to average non-export value; (2) information but failed to properly Louis Apple entitled ‘‘Antidumping representative of a range of prices include this information in its sales Duty Investigation of Color Television within the POI or most database. Because XOCECO was only Receivers from the People’s Republic of contemporaneous with the POI; (3) partially responsive, we have not relied China (PRC): Request for a List of product-specific; and (4) tax-exclusive. on its control-number-specific U.S. Surrogate Countries.’’ For a more detailed explanation of the warehousing and other U.S. According to the available methodology used in calculating various transportation expenses, and instead information on the record, we have surrogate values, see the Factors have based the amount of these determined that India is a significant Memorandum. expenses on FA, pursuant to section producer of CTVs. See the November 21, In selecting the surrogate values, we 776(a)(2)(A) of the Act. In selecting 2003, memorandum from the team to considered the quality, specificity, and among the facts otherwise available, we the file entitled ‘‘Preliminary contemporaneity of the data. As applied the average of the reported Determination Factors Valuation appropriate, we adjusted input prices by model-specific warehouse and other Memorandum,’’ (the Factors including freight costs to make them transportation expenses for every Memorandum), on file in the CRU. For delivered prices. We added to Indian transaction during the POI. purposes of the preliminary surrogate values surrogate freight costs We made additional deductions from determination, we have selected India using the shorter of the reported CEP for credit expenses, warranty as the surrogate country, based on the distance from the domestic supplier to expenses, and U.S. indirect selling quality and contemporaneity of the the factory or the distance from the expenses, including U.S. inventory currently available data. Accordingly, nearest seaport to the factory. This carrying costs and other indirect selling we have calculated NV using Indian adjustment is in accordance with the expenses, in accordance with section values for the PRC producers’ factors of Court of Appeals for the Federal

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66808 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Circuit’s decision in Sigma Corporation Calcutta and published by the World We valued labor based on a v. United States, 117 F. 3d 1401, 1407– Trade Atlas Trade Information System regression-based wage rate, in 08 (Fed. Cir. 1997). For a discussion of (World Trade Atlas) covering the period accordance with 19 CFR 351.408(c)(3). the valuation of Changhong, Konka, and October 2002 through March 2003. To determine factory overhead, TCL’s freight costs, see the ‘‘Export Regarding sales of scrap metal, depreciation, SG&A expenses, interest Price/Constructed Export Price’’ section XOCECO twice failed to provide expenses, and profit for the finished of this notice, above. Regarding the requested documentation demonstrating product, we relied on rates derived from valuation of foreign inland freight for sales of scrap metal during the POI. As the financial statements of BPL, Onida XOCECO, we note that XOCECO failed a result, use of FA, pursuant to section Saka, and Videocon, Indian producers to amend its factors of production 776(a)(2)(A) of the Act, is appropriate. of identical merchandise. We applied database to include distances and Furthermore, since the Department these ratios to the respondents’ costs modes of transportation from NME finds that XOCECO failed to cooperate (determined as noted above) for suppliers, despite a specific request that by not acting to the best of its ability to materials, labor, and energy. it do so. As a result, we find that the use comply with the request for Critical Circumstances of FA, pursuant to section 776(a)(2)(A) information, an adverse inference is of the Act, is appropriate. Furthermore, warranted under section 776(b) of the On October 16, 2003, the petitioners because XOCECO failed to cooperate by Act. As AFA, we are denying XOCECO alleged that there is a reasonable basis not acting to the best of its ability to any offset on sales of tin scrap to its to believe or suspect critical comply with the request for consumption of tin. Rather, we allocated circumstances exist with respect to the information, we find that an adverse this quantity of scrap across the antidumping investigation of CTVs from inference is warranted under section production of subject merchandise the PRC. In accordance with 19 CFR 776(b) of the Act. In calculating freight during the POI, thereby increasing the 351.206(c)(2)(i), because petitioners on factor inputs, as AFA, we multiplied per-unit consumption of this metal. submitted a critical circumstances the factor input by the highest freight allegation more than 20 days before the surrogate value on the record of this We valued natural gas using a price scheduled date of the preliminary case and the distance from the obtained from the website of the Gas determination, the Department must applicable port to the factory. Authority of India Ltd., a supplier of issue its preliminary critical Where appropriate, we adjusted natural gas in India, covering the period circumstances determination not later surrogate values to reflect inflation up to January through June 2002. For further than the date of the preliminary the POI using the WPI or the PPI discussion, see the Factors determination. Memorandum. published by the IMF, as appropriate. Section 733(e)(1) of the Act provides Some inputs were purchased from For aluminum paper, cardboard, that the Department, upon receipt of a market-economy suppliers and paid for carton, inner cardboard paper, labels, timely allegation of critical in convertible currency. Following our manuals, nails, outside cardboard paper, normal practice, we used the actual circumstances, will determine whether package bags, packing tape, plastic there is a reasonable basis to believe or price paid for these inputs, where accessory bags, plastic bags, plastic possible. However, where the input was suspect that: (A)(i) there is a history of strap, polyethylene plastic bags, dumping and material injury by reason not purchased from a market-economy polyfoam, polypropylene sheet, and supplier and paid for in a market- of dumped imports in the United States staples (i.e., the packing materials or elsewhere of the subject merchandise, economy currency, or where the input reported by the respondents), we used was purchased from a market-economy or (ii) the person by whom, or for whose import values from the World Trade account, the merchandise was imported country which the Department has Atlas. found to maintain broadly-available, knew or should have known that the non-industry-specific subsides which Regarding the remaining raw material exporter was selling the subject may benefit all exporters to all export factors of production reported by the merchandise at less than its fair value markets (i.e., Korea, India, Indonesia, respondents, we did not value these and there was likely to be material and Thailand), it was necessary to select factors because: (1) Surrogate value injury by reason of such sales, and (B) a surrogate value. information was not available; and (2) there have been massive imports of the Regarding color picture tubes and the materials were reported as used in subject merchandise over a relatively speakers, where the respondents very small amounts. See the short period. purchased these inputs from suppliers memorandum entitled ‘‘Concurrence According to 19 CFR 351.206(h)(1), in in the PRC or from one of the market Memorandum for the Preliminary determining whether imports of the economies identified above, we valued Determination in the Investigation of subject merchandise have been these inputs using import data obtained Certain Color Television Receivers from ‘‘massive,’’ the Department normally from http://www.infodriveindia.com, a the People’s Republic of China,’’ dated will examine: (i) The volume and value fee-based Web site providing Indian November 21, 2003. We valued of the imports; (ii) seasonal trends; and customs data. We used this source electricity using electricity rate data (iii) the share of domestic consumption because it provided the most specific from the International Energy Agency’s accounted for by the imports. In information available for the color Key World Energy Statistics 2002 report addition, 19 CFR 351.206(h)(2) provides picture tubes and speakers used by the (see http://www.iea.org/statist/ that ‘‘unless the imports during a respondents. See the Factors keyworld2002/key2002/keystats.htm) ‘‘relatively short period’’ have increased Memorandum. We valued all other used in the 2002–2003 antidumping by at least 15 percent over the imports major raw material inputs not duty administrative review of creatine during an immediately preceding period purchased by the respondents from from the PRC. See Creatine of comparable duration, the Secretary market economies using India import Monohydrate From the People’s will not consider the imports massive.’’ statistics published by the Directorate Republic of China: Preliminary Results In accordance with 19 CFR 351.206(i), General of Commercial Intelligence and of Antidumping Duty Administrative the Department defines ‘‘relatively short Statistics of the Ministry of Commerce Review, 68 FR 62767, 62769 (Nov. 6, period’’ as generally the period and Industry, Government of India, 2003). beginning on the date the proceeding

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66809

begins (i.e., the date the petition is filed) not consider, under 19 CFR 351.206(h), As discussed above, no other party and ending at least three months later. the imports to have been ‘‘massive.’’ responded to the Department’s request In determining whether the above To determine whether imports of for information and thus we relied on statutory criteria have been satisfied, we subject merchandise have been massive AFA for the rate applicable to the ‘‘PRC examined: (1) The evidence presented over a relatively short period, we entity’’ (i.e., the PRC-wide rate). in the petitioners’ submission of compared the respondents’ export Therefore, the use of AFA is also October 16, 2003; (2) exporter-specific volumes for the five months before the warranted in the critical circumstances shipment data requested by the filing of the petition (i.e., December analysis for the PRC entity. As AFA in Department; (3) evidence obtained since 2002 through April 2003) to that during this case, we relied on the import the initiation of the LTFV investigation the five months following the filing of statistics through September 2003 (the (i.e., additional import statistics the petition (i.e., May through latest month for which such data was released by U.S. Customs and Border September 2003). These periods were available for the preliminary Protection (CBP)); and (4) the ITC selected based on the Department’s determination). The import statistics preliminary injury determination. practice of using the longest period for showed an increase in imports that was To determine whether a history of which information is available from the significantly greater than 15 percent. dumping and material injury exists, the month that the petition was filed Even if we were to subtract the Department generally considers current through the effective date of the shipment data provided by the or previous antidumping duty orders on preliminary determination. mandatory respondents from the the subject merchandise from the The Department requested and aggregate import data and to compare country in question in the United States obtained from Changhong, Konka, TCL, the remaining volume of imports in the and current orders in any other country. and XOCECO monthly shipment data base period to the remaining imports in for 2001, 2002, and 2003. According to The Department will normally not the comparison period, this comparison the monthly shipment information, we consider the initiation of a case, or a would indicate that massive imports found the volume of shipments of CTVs preliminary or final determination of occurred. See the Critical Circumstances by each of these companies increased by sales at LTFV in the absence of an Memo. more than 15 percent. Therefore, we affirmative finding of material injury by In summary, we find there is a analyzed the time series data for the two the ITC, as indicative of a history reasonable basis to believe or suspect years prior to the petition (i.e., 2001 and sufficient to satisfy this criterion. See importers had knowledge of dumping 2002), to address the issue of and the likelihood of material injury Preliminary Determinations of Critical seasonality. Although this data shows with respect to CTVs from the PRC. We Circumstances: Steel Concrete there have also been significant surges further find there have been massive Reinforcing Bars From Ukraine and in imports from the respondents imports of CTVs over a relatively short Moldova, 65 FR 70696, 70696–97 (Nov. between those same base and period from each of the mandatory 27, 2000). With regard to imports of comparison periods, we find that this respondents. Given the analysis CTVs from the PRC, the European seasonal pattern does not account summarized above, and described in Union (EU) imposed antidumping duty entirely for the increase in imports. more detail in the Critical measures on CTVs from the PRC in Specifically, we note that imports have Circumstances Memo, we preliminarily 1995. See Council Regulation 1531/2002 increased substantially over their determine critical circumstances exist of 14 August 2002 on Imposing a normal seasonal levels. We therefore for imports of CTVs produced in and Definitive Anti-dumping Duty on find that imports of subject merchandise exported from the PRC. Imports of Colour Television Receivers, were massive in the comparison period. In accordance with section 733(e)(2) 2002 O.J. (L 231)1–28. Because there is For further discussion of this analysis, of the Act, upon issuance of an a history of dumping and material see the November 21, 2003, affirmative preliminary determination of injury by reason of dumped imports in memorandum from the team to Louis sales at LTFV in the investigation with the EU of the subject merchandise, the Apple, Office Director, entitled respect to CTVs from the PRC, the first criterion of the test for finding ‘‘Antidumping Duty Investigation of Department will direct the CBP to critical circumstances is met. Certain Color Televisions (CTVs) from suspend liquidation of all entries of Because we have preliminarily found the People’s Republic of China CTVs from the PRC that are entered, or that section 733(e)(1)(A) of the Act is Preliminary Affirmative Determination withdrawn from warehouse, for met, we must consider whether under of Critical Circumstances,’’ (Critical consumption on or after 90 days prior section 733(e)(1)(B) of the Act imports Circumstances Memo). to the date of publication in the Federal of the merchandise have been massive With regard to the share of domestic Register of our preliminary over a relatively short period. According consumption accounted for by imports, determination in this investigation. The to 19 CFR 351.206(h), we consider the we were unable, pursuant to 19 CFR CBP shall require a cash deposit or following to determine whether imports 351.206(h)(iii), to consider the share of posting of a bond equal to the estimated have been massive over a relatively domestic consumption accounted for by preliminary dumping margins reflected short period of time: (1) The volume and the imports because the available data in the preliminary determinations value of the imports; (2) seasonal trends did not permit such analysis. It is the published in the Federal Register. The (if applicable); and (3) the share of Department’s practice to conduct its suspension of liquidation to be issued domestic consumption accounted for by critical circumstances analysis of after our preliminary determination will the imports. companies in the ‘‘All Others’’ category remain in effect until further notice. We When examining volume and value based on the experience of the will make a final determination data, the Department typically compares investigated companies. Because we are concerning critical circumstances for all the export volume for equal periods determining that critical circumstances producers and exporters of subject immediately preceding and following exist for each of the mandatory merchandise from the PRC when we the filing of the petition. Unless the respondents in this investigation, we are make our final determination in this imports in the comparison period have concluding that critical circumstances investigation, which will be 135 days increased by at least 15 percent over the exist for companies covered by the ‘‘All after the date of publication of the imports during the base period, we will Others’’ rate. preliminary determination.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00014 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66810 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Verification Disclosure Dated: November 21, 2003. James J. Jochum, As provided in section 782(i) of the We will disclose the calculations Act, we intend to verify all information performed within five days of the date Assistant Secretary for Import Administration. relied upon in making our final of publication of this notice to parties in determination. this proceeding in accordance with 19 [FR Doc. 03–29721 Filed 11–26–03; 8:45 am] CFR 351.224(b). BILLING CODE 3510–DS–P Suspension of Liquidation ITC Notification In accordance with section 733(d)(2) DEPARTMENT OF COMMERCE of the Act, we are directing the CBP to In accordance with section 733(f) of the Act, we have notified the ITC of our suspend liquidation of all imports of International Trade Administration subject merchandise from the PRC determination. If our final entered, or withdrawn from warehouse, determination is affirmative, the ITC [A–557–812] for consumption on or after 90 days will determine whether these imports prior to the date of publication of this are materially injuring, or threaten Notice of Negative Preliminary notice in the Federal Register. We are material injury to, the U.S. industry. Determination of Sales at Less Than also instructing the CBP to require a The deadline for that ITC determination Fair Value, Postponement of Final cash deposit or the posting of a bond would be the later of 120 days after the Determination, and Negative equal to the weighted-average dumping date of this preliminary determination Preliminary Determination of Critical margin for all entries of CTVs from the or 45 days after the date of our final Circumstances: Certain Color PRC. These suspension of liquidation determination. Televisions From Malaysia instructions will remain in effect until Public Comment AGENCY: Import Administration, further notice. Case briefs for this investigation must International Trade Administration, The weighted-average dumping Department of Commerce. margins are as follows: be submitted no later than seven days after the date of the final verification ACTION: Notice of preliminary determination of sales at less than fair Weighted- report issued in this proceeding. Critical cir- Rebuttal briefs must be filed five days value. Manufacturer/Ex- average cum- porter margin from the deadline date for case briefs. A stances SUMMARY: We preliminarily determine (in percent) list of authorities used, a table of that certain color televisions from contents, and an executive summary of Haier Electric Ap- 40.84 Yes. Malaysia are not being, nor are likely to issues should accompany any briefs pliances Inter- be, sold in the United States at less than submitted to the Department. Executive national Co. fair value, as provided in section 733(b) summaries should be limited to five Hisense Import 40.84 Yes. of the Tariff Act of 1930, as amended. and Export Co., pages total, including footnotes. See 19 In addition, we preliminarily determine Ltd. CFR 351.309. that there is no reasonable basis to Konka Group 27.94 Yes. Section 774 of the Act provides that believe or suspect that critical Company, Ltd. the Department will hold a hearing to circumstances exist with respect to Philips Consumer 40.84 Yes. afford interested parties an opportunity Electronics Co. subject merchandise exported from to comment on arguments raised in case of Suzhou Ltd. Malaysia. briefs, provided that such a hearing is Shenzhen 40.84 Yes. Interested parties are invited to requested by any interested party. If a Chaungwei- comment on this preliminary request for a hearing is made in this RGB Elec- determination. We will make our final tronics Co., Ltd. investigation, the hearing will determination not later than 135 days Sichuan 45.87 Yes. tentatively be held two days after the after the date of this preliminary Changhong deadline for submission of the rebuttal determination. Electric Co., Ltd. briefs at the U.S. Department of Starlight Inter- 40.84 Yes. Commerce, 14th Street and Constitution EFFECTIVE DATE: November 28, 2003. national Hold- ings, Ltd. Avenue, NW., Washington, DC 20230. FOR FURTHER INFORMATION CONTACT: Star Light Elec- 40.84 Yes. Parties should confirm by telephone the Mike Strollo or Gregory E. Kalbaugh, tronics Co., Ltd. time, date, and place of the hearing 48 Office of AD/CVD Enforcement, Office Star Fair Elec- 40.84 Yes. hours before the scheduled time. 2, Import Administration, International tronics Co., Ltd. Interested parties who wish to request a Trade Administration, U.S. Department Starlight Mar- 40.84 Yes. hearing, or to participate if one is of Commerce, 14th Street and keting Develop- requested, must submit a written Constitution Avenue, NW., Washington, ment Ltd. request within 30 days of the DC 20230; telephone: (202) 482–0629 or SVA Group Co., 40.84 Yes. publication of this notice. Requests Ltd. (202) 482–3693, respectively. should specify the number of TCL Holding 31.35 Yes. Preliminary Determination Company Ltd. participants and provide a list of the Xiamen Overseas 31.70 Yes. issues to be discussed. Oral We preliminarily determine that Chinese Elec- presentations will be limited to issues certain color televisions (CTVs) from tronic Co., Ltd. raised in the briefs. See 19 CFR 351.310. Malaysia are not being sold, nor are PRC-wide ...... 78.45 Yes. We will make our final determination likely to be sold, in the United States at no later than 135 days after the date of less than fair value (LTFV), as provided The PRC-wide rate applies to all this preliminary determination, in section 733 of the Tariff Act of 1930, entries of the subject merchandise pursuant to section 735(a)(2) of the Act. as amended (the Act). The estimated except for entries from exporters/ This determination is published margins of sales at LTFV are shown in producers that are identified pursuant to sections 733(f) and 777(i) of the ‘‘Suspension of Liquidation’’ section individually above. the Act. of this notice. In addition, we

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66811

preliminarily determine that there is no Department’s section A supplemental determination in this investigation, the reasonable basis to believe or suspect questionnaire. Department postpone its final that critical circumstances exist with On August 22, 2003, the Department determination until not later than 135 respect to CTVs produced in and issued its first section D supplemental days after the the date of the publication exported from Malaysia. The critical questionnaire to Funai Malaysia. On of the preliminary determination in the circumstances analysis for the September 4, 2003, Funai Malaysia Federal Register. In addition, in Funai preliminary determination is discussed responded to this supplemental Malaysia’s request for a postponement, below under the section ‘‘Critical questionnaire. it also requested an extension of Circumstances.’’ On September 9, 2003, Funai provisional measures from a four-month Malaysia submitted its response to the period to not more than six months in Case History Department’s , 2003, section C accordance with 19 CFR 351.210(e)(2). Since the initiation of this supplemental questionnaire. On November 18, 2003, the petitioners investigation ((Notice of Initiation of On and September 16, requested that, in the event of a negative Antidumping Duty Investigations: 2003, the Department issued section D preliminary determination in this Certain Color Television Receivers From supplemental questionnaires. investigation, the Department postpone Malaysia and the People’s Republic of On , 2003, the its final determination until not later China, 68 FR 32013 (May 29, 2003)) petitioners submitted comments than 135 days after the date of the (Initiation Notice), the following events opposing Algert/Panasonic’s , publication of the preliminary have occurred: 2003, scope exclusion request. determination in the Federal Register. On , 2003, the On June 13, 2003, Algert Co., Inc., and Postponement of Final Determination Panasonic AVC Networks Kuala Department issued an additional Lumpur Malaysia Sdn. Bhd sections A and C supplemental Section 735(a)(2) of the Act provides (collectively, Algert/Panasonic) questionnaire to Funai Malaysia. that a final determination may be requested that Panasonic multi-system, On September 17, 2003, pursuant to postponed until not later than 135 days dual/auto voltage CTVs be excluded section 733(c)(2) of the Act and 19 CFR after the date of the publication of the from the scope of this investigation. 351.205(f), the Department determined preliminary determination if, in the that the case was extraordinarily On June 16, 2003, the United States event of an affirmative preliminary complicated and postponed the International Trade Commission (ITC) determination, a request for such preliminary determination until no later preliminarily determined that there is a postponement is made by exporters who than November 21, 2003. See reasonable indication that imports of account for a significant proportion of Postponement of Preliminary CTVs from Malaysia are materially exports of the subject merchandise, or in Determinations of Antidumping Duty injuring the United States industry. See the event of a negative preliminary Investigations: Certain Color Television ITC Investigation Nos. 731–TA–1034 determination, a request for such Receivers From Malaysia (A–557–812) and 1035 (Certain Color Television postponement is made by the petitioner. and the People’s Republic of China (A– Receivers from China and Malaysia, 68 The Department’s regulations, at 19 CFR 570–884), 68 FR 55372 (Sept. 25, 2003). FR 38089 (June 26, 2003)). 351.210(e)(2), require that requests by On October 3, 2003, Funai Malaysia Also on June 16, 2003, we issued an respondents for postponement of a final submitted its response to the questions determination be accompanied by a antidumping questionnaire to Funai pertaining to section A of the Electric (Malaysia) Sdn. Bhd. (Funai request for extension of provisional Department’s September 24, 2003, measures from a four-month period to Malaysia), the producer/exporter supplemental questionnaire. accounting for the largest volume of not more than six months. On October 9, 2003, Funai Malaysia Pursuant to section 735(a)(2) of the known exports of subject merchandise submitted its response to the Act, the petitioners requested that, in from Malaysia during the period of Department’s September 11 and the event of a negative preliminary investigation (POI). For further September 16, 2003, supplemental determination in this investigation, the discussion, see the memorandum to questionnaires. Department postpone its final Louis Apple, Director, Office 2, from the On , 2003, Funai Malaysia determination until not later than 135 Team entitled ‘‘Antidumping Duty submitted its response to the questions days after the date of the publication of Investigation of Certain Color pertaining to section C of the the preliminary determination in the Televisions from Malaysia—Selection of Department’s September 24, 2003, Federal Register. In accordance with 19 Respondents,’’ dated May 30, 2003. supplemental questionnaire. CFR 351.210(b), because our On , 2003, Funai Malaysia On October 16, 2003, the petitioners preliminary determination is negative submitted information stating that it had alleged that critical circumstances exist and no compelling reasons for denial no viable home market or third country with respect to imports of CTVs from exist, we are granting the petitioners’ market during the POI. On July 21, Malaysia. Accordingly, pursuant to request and are postponing the final 2003, Funai Malaysia submitted a section 732(e) of the Act, on October 17, determination until no later than 135 response to section A of the 2003, we requested information from days after the publication of this notice Department’s questionnaire. Funai Malaysia regarding monthly in the Federal Register. On , 2003, the Department shipments to the United States during issued a section A supplemental the period January 2001 through Period of Investigation questionnaire to Funai Malaysia. October 2003. We received the The POI is April 1, 2002, through On August 6, 2003, Funai Malaysia requested information on October 31, March 31, 2003. This period submitted responses to sections C and D 2003. The critical circumstances corresponds to the four most recent of the Department’s questionnaire. analysis for the preliminary fiscal quarters prior to the month of the On August 19, 2003, the Department determination is discussed below under filing of the petition (i.e., May 2003). issued its first section C supplemental ‘‘Critical Circumstances.’’ questionnaire to Funai Malaysia. On November 17, 2003, Funai Scope of Investigation On August 20, 2003, Funai Malaysia Malaysia requested that, in the event of For purposes of this investigation, the submitted its response to the an affirmative preliminary term ‘‘certain color television receivers’’

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66812 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

includes complete and incomplete including the multi-system, dual/auto United States were made at LTFV, we direct-view or projection-type cathode- voltage CTVs produced by PAVCKM compared the export price (EP) or ray tube color television receivers, with and sold by Algert, are appropriately constructed export price (CEP) to the a video display diagonal exceeding 52 included in the scope of this Normal Value (NV), as described in the centimeters, whether or not combined investigation. For a further discussion, ‘‘Export Price/Constructed Export Price’’ with video recording or reproducing see the memorandum to Louis Apple, and ‘‘Normal Value’’ sections of this apparatus, which are capable of Director, Office 2 from Michael Strollo notice, below. In accordance with receiving a broadcast television signal entitled ‘‘Scope Exclusion Request,’’ section 777A(d)(1)(A)(i) of the Act, we and producing a video image. dated November 21, 2003. compared POI weighted-average EPs Specifically excluded from this and CEPs to NVs. Class or Kind investigation are computer monitors or For this preliminary determination, other video display devices that are not As part of its scope request, Algert/ we have determined that Funai capable of receiving a broadcast Panasonic argued that the Panasonic Malaysia did not have a viable home or television signal. multi-system, dual/auto voltage CTVs third country market. Therefore, as the The color television receivers subject fall into a separate class or kind of basis for NV, we used constructed value to this investigation are currently merchandise from other color (CV) when making comparisons in classifiable under subheadings televisions. In considering whether this accordance with section 773(a)(4) of the 8528.12.2800, 8528.12.3250, product should be considered a separate Act. 8528.12.3290, 8528.12.4000, class or kind, we analyzed the Export Price/Constructed Export Price 8528.12.5600, 8528.12.3600, arguments submitted by all of the 8528.12.4400, 8528.12.4800, and interested parties in the context of the In accordance with section 772(a) of 8528.12.5200 of the Harmonized Tariff criteria enumerated in the court the Act, we calculated EP for those sales Schedule of the United States decision Diversified Products Corp. v. where the merchandise was sold to the (‘‘HTSUS’’). Although the HTSUS United States, 572 F. Supp. 883, 889 first unaffiliated purchaser in the United subheading is provided for convenience (CIT 1983) (Diversified). For this States prior to importation by the and customs purposes, the written analysis, we relied upon the petition, exporter or producer outside the United description of the scope of the the submissions by all interested States. We based EP on the packed price merchandise under investigation is parties, the preliminary determination to unaffiliated purchasers in the United dispositive. made by the ITC, and other information. States. We made deductions for The criteria set forth in Diversified to movement expenses in accordance with Scope Comments examine whether differences in class or section 772(c)(2)(A) of the Act; these In accordance with the preamble to kind exist are as follows: (1) The general included, where appropriate, foreign our regulations (see Antidumping physical characteristics of the warehousing, foreign inland freight, Duties; Countervailing Duties, 62 FR merchandise; (2) the expectations of the foreign inland insurance, and foreign 27296, 27323 (May 19, 1997)), we set ultimate purchaser; (3) the ultimate use brokerage and handling expenses. aside a period of time for parties to raise of the merchandise; (4) the channels of In accordance with section 772(b) of issues regarding product coverage and trade in which the merchandise moves, the Act, we calculated CEP for those encouraged all parties to submit and; (5) the manner in which the sales where the merchandise was sold comments within 20 calendar days of product is advertised or displayed. (or agreed to be sold) in the United publication of the Initiation Notice (see Based upon the evaluation of these States before or after the date of 68 FR at 32013). Interested parties criteria, we preliminarily find that importation by or for the account of the submitted such comments by June 13, Panasonic multi-system, dual/auto producer or exporter, or by a seller 2003. voltage CTVs are the same class or kind affiliated with the producer or exporter, Pursuant to the Department’s of merchandise as the other CTVs to a purchaser not affiliated with the solicitation of scope comments in the included within the scope of this producer or exporter. Initiation Notice, Algert/Panasonic investigation. Specifically, we note that We based CEP on the packed requested that Panasonic multi-system, the essential physical characteristics of delivered prices to unaffiliated dual/auto voltage CTVs be excluded a Panasonic multi-system, dual/auto purchasers in the United States. We from the scope of this investigation voltage CTV and a standard CTV are the made deductions for movement because: (1) These CTVs are not same (i.e., an electronic product capable expenses, in accordance with section produced domestically; and (2) they do of receiving a broadcast television signal 772(c)(2)(A) of the Act; these included, not compete in any meaningful way and producing a video image); the where appropriate, foreign inland with CTVs that are produced in the ultimate use of the product (i.e., the freight, foreign warehousing expenses, United States. On September 23, 2003, receipt of a broadcast television signal foreign inland insurance, foreign the petitioners opposed this request. and the production of a video image) brokerage and handling expenses, ocean After considering the interested party and as such, the expectations of the freight, marine insurance, U.S. comments and the petitioners’ ultimate purchasers, are the same for all brokerage and handling, U.S. customs objections to the exclusion request CTVs; channels of distribution (i.e., duties (including harbor maintenance regarding the Panasonic multi-system, retail outlets) are the same; and finally, fees and merchandise processing fees), dual/auto voltage CTVs, we find that the the CTVs in question are clearly U.S. inland insurance, U.S. inland CTVs in question fall within the scope advertised and displayed as CTVs. freight expenses (i.e., freight from port of this investigation. All CTVs, Consequently, we preliminarily find to warehouse and freight from including the CTVs in question, have that the CTVs in question do not warehouse to the customer), post-sale the same fundamental characteristics— constitute a separate class or kind of warehousing expenses, and intra- that is they are capable of receiving a merchandise. warehousing transfer expenses. In broadcast signal and displaying a video accordance with section 772(d)(1) of the image. Therefore, we conclude that all Fair Value Comparisons Act and 19 CFR 351.402(b), we CTVs, whether having multiple signal To determine whether sales of certain deducted those selling expenses capability or dual/auto voltage, color televisions from Malaysia to the associated with economic activities

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66813

occurring in the United States, the United States and the profit NV and CEP affects price comparability, including direct selling expenses (i.e., associated with those sales. we adjust NV under section 773(a)(7)(B) bank charges and imputed credit of the Act (the CEP-offset provision). Normal Value expenses), and indirect selling expenses See Notice of Final Determination of (including inventory carrying costs and A. Home Market Viability Sales at Less Than Fair Value: Certain other indirect selling expenses). In order to determine whether there Cut-to-Length Carbon Steel Plate from We note that, in their November 6, was a sufficient volume of sales in the South Africa, 62 FR 61731, 23761 (Nov. 2003, comments on the preliminary home market to serve as a viable basis 19, 1997). In this investigation, we found that determination, the petitioners argued for calculating NV (i.e., the aggregate Funai Malaysia had no viable home or that the Department should deduct from volume of home market sales of the third country market. When NV is based CEP the indirect selling expenses foreign like product is equal to or incurred by Funai Electric Co., Ltd. on CV, the NV LOT is that of the sales greater than five percent of the aggregate from which we derive SG&A expenses (Funai Electric) in Japan on sales to the volume of U.S. sales), we compared the United States. The petitioners claim that and profit (see Notice of Preliminary respondent’s volume of home market Determination of Sales at Less Than these indirect expenses incurred by sales of the foreign like product to the Funai Electric are associated with sales Fair Value and Postponement of Final volume of U.S. sales of the subject Determination: Fresh Atlantic Salmon to unaffiliated customers made by Funai merchandise, in accordance with Corporation, Inc. (Funai Corporation), from Chile, 63 FR 2664 (Jan. 16, 1998)). section 773(a)(1)(C) of the Act. In accordance with 19 CFR 351.412(d), Funai Malaysia’s affiliated reseller in Funai Malaysia reported that during the United States. the Department will make its LOT the POI it made no home market sales determination under paragraph (d)(1) of As noted above, pursuant to 19 CFR of foreign like product. Sales to Funai 351.402(b), we deduct from CEP those this section on the basis of sales of the Malaysia’s largest third-country market, foreign like product by the producer or selling expenses associated with Japan, were not greater than five percent commercial activities occurring in the exporter. Because it is not possible in of the aggregate volume of U.S. sales of the instant case to make an LOT United States that relate to the sale to an the subject merchandise. Therefore, we determination on the basis of sales of unaffiliated purchaser, no matter where determined that neither the home the foreign like product in the home or or when paid. This regulation also states market nor any third country market third country market, the Department that the Department will not make any was a viable basis for calculating NV. As may use sales of different or broader adjustment to CEP for any expense that a result, we used CV as the basis for product lines, sales by other companies, is related solely to the sale to an calculating NV, in accordance with or any other reasonable basis. Because affiliated importer in the United States. section 773(a)(4) of the Act. we based the selling expenses and profit The information on the record indicates for Funai Malaysia on the weighted that Funai Electric’s selling functions B. Level of Trade average selling expenses incurred and are limited to: (1) Inputting and In accordance with section profits earned by another Malaysian processing of orders of Funai Malaysia’s 773(a)(1)(B) of the Act, to the extent producer of comparable merchandise merchandise made by Funai practicable, we determine NV based on who was not party to this investigation, Corporation; (2) customer interaction sales in the comparison market at the there is insufficient information on the (i.e., with Funai Corporation); and (3) same level of trade as the EP or CEP. record in this investigation to allow the sales logistics associated with The NV level of trade (LOT) is that of Department to make an LOT adjustment transporting the merchandise from the starting-price sales in the or grant a CEP offset to the CVs reported Malaysia to Funai Corporation’s comparison market or, when NV is by Funai Malaysia. designated place of delivery. None of based on CV, that of the sales from these selling functions indicate that which we derive selling, general and Calculation of Constructed Value Funai Electric incurred selling expenses administrative expenses (SG&A) and In accordance with section 773(e) of associated with economic activities profit. For EP, the U.S. LOT is also the the Act, we calculated CV based on the occurring in the United States on the level of the starting-price sale, which is sum of Funai’s cost of materials and sale to unaffiliated customers. Rather, usually from exporter to importer. For fabrication for the foreign like product, the selling functions performed, and the CEP, it is the level of the constructed plus amounts for SG&A, profit, and U.S. selling expenses incurred, appear to be sale from the exporter to the importer. packing costs. We relied on the associated only with Funai Electric’s To determine whether NV sales are at submitted CV information for Funai sales to Funai Corporation. Therefore, a different LOT than EP or CEP sales, we Malaysia, except in the following because the evidence on the record does examine stages in the marketing process instances where the reported costs were not support the petitioners’ contention and selling functions along the chain of not appropriately quantified or valued. that Funai Electric’s indirect selling distribution between the producer and • We revised the company’s reported expenses incurred in Japan are: (1) the unaffiliated customer. If the general and administrative (G&A) Associated with commercial activities comparison-market sales are at a expenses to include Funai Malaysia’s in the United States; and (2) related to different LOT, and the difference affects net G&A expenses. the sale to an unaffiliated purchaser, we price comparability, as manifested in a • We calculated the company’s CV have not deducted these expenses from pattern of consistent price differences profit and domestic selling expense CEP. between the sales on which NV is based ratios using the financial statements of Pursuant to section 772(d)(3) of the and comparison market sales at the level a surrogate Malaysian company that Act, we further reduced the starting of trade of the export transaction, we sold merchandise that is in the same price by an amount for profit to arrive make an LOT adjustment under section general category of products as the at CEP. In accordance with section 773(a)(7)(A) of the Act. Finally, for CEP subject merchandise, using data that 772(f) of the Act, we calculated the CEP sales, if the NV level is more remote was contemporaneous to the POI. profit rate using the expenses incurred from the factory than the CEP level and For further discussion of these by Funai Malaysia and its affiliate on there is no basis for determining adjustments, see the memorandum from their sales of the subject merchandise in whether the difference in levels between Mark Todd to Neal Halper, entitled

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66814 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

‘‘Cost of Production and Constructed Antidumping Duty Order: Brass Sheet subcontractor is not the ‘‘producer’’ of Value Calculation Adjustments for the and Strip From the Netherlands, 65 FR the PCB and, thus, the subcontracting Preliminary Determination,’’ dated 742 (Jan. 6, 2000). services provided by this entity merely November 21, 2003. In accordance with our practice and represents one of the inputs into the During the POI, Funai Malaysia 19 CFR 351.401(h), in this case we find final PCB product. In any event, we purchased a major input, printed circuit that the Hong Kong company is the disagree with the petitioners that, even boards (PCBs), from an affiliated PCB- producer of the PCBs in question assuming that these parties were board producer in Hong Kong. This because it provides the design of the deemed to be affiliated, it would be affiliate purchased the raw materials PCB, purchases all of the raw materials appropriate to collect factors data from necessary to produce the PCB from both necessary to produce it, arranges for the the subcontractor because the assembly market and NME suppliers, and then it conversion of these materials into the operations constitute a minor portion of subcontracted the assembly operations finished product, and then controls the the total cost of the CTV (and thus the with an entity located in the People’s relevant sale to Funai Malaysia. See, major input rule does not apply to the Republic of China (PRC). In order to e.g., Remand Redetermination: Static assembly operations). demonstrate that the affiliate’s Random Access Memory Because the Hong Kong company is purchases from its PRC suppliers Semiconductors from Taiwan (June 30, the producer of the PCB and the reasonably reflect the costs associated 2000); Notice of Final Determination of Department treats Hong Kong as a with the production and sale of the Sales at Less Than Fair Value: Polyvinyl market economy, the statute directs us merchandise, Funai Malaysia provided Alcohol From Taiwan, 61 FR 14064, to use the company’s recorded costs quotes from various market economy 14070 (Mar. 29, 1996); Notice of Final unless they are not consistent with suppliers of the same parts which Determination of Sales at Less Than GAAP or do not reasonably reflect the showed that the prices recorded in the Fair Value. Certain Forged Stainless costs of production or sale. The normal books and records closely Steel Flanges from India, 58 FR 68853, Department may find that a approximated market values. 68855 (Dec. 29, 1993). Therefore, we respondent’s costs recorded in its The petitioners have requested that, have looked to the books and records of normal books and records do not in applying the major input rule under the Hong Kong affiliate to determine the reasonably reflect the costs of the section 773(f)(3) of the Act, the cost of the PCB, rather than to the books merchandise where the costs are Department disregard the Hong Kong and records of the PRC subcontractor. allocated to the merchandise under affiliate’s actual costs as recorded in its In addition, we have examined the consideration in a manner which distort books and records and instead information on the record regarding the the dumping analysis. See, e.g., Final determine the costs incurred in the PRC relationship between Funai Malaysia Determination of Sales at Less Than using a factors of production approach. and its subcontractor and preliminarily Specifically, the petitioners assert that find that these companies are not Fair Value: Oil Country Tubular Goods the Hong Kong affiliate and its affiliated within the meaning of section From Argentina, 60 FR 33539, 33547 subcontractor are themselves affiliated 771(33) of the Act. Specifically, we find (, 1995); and Elemental Sulphur by virtue of an exclusive supply that there is no cross-ownership in these From Canada; Final Results of relationship between the two entities, entities, and that neither Funai Malaysia Antidumping Finding Administrative and thus the Department is required to nor Funai Hong Kong is in a position to Review, 61 FR 8239, 8241–8243 (Mar. 4, rely on surrogate values for labor and exercise control or restraint over the 1996). While the Hong Kong company overhead incurred by the Chinese subcontractor. Rather, the subcontractor made purchases from unaffiliated PRC subcontractor, as well as for those has numerous manufacturing facilities suppliers, these purchases were made in transactions where raw material inputs in the PRC, not all of which assemble a market economy (i.e., Hong Kong) by are transferred from Chinese suppliers PCBs, and it makes a variety of other a market-economy entity which to the Chinese subcontractor through products. See Funai Malaysia’s October maintains that its books and records are Funai Hong Kong. 14, 2003, submission at pages 10–11 and kept in accordance with Hong Kong We find that there is no legal basis to Exhibit 1. Additionally, we find that the GAAP. Thus, we preliminarily find that adopt the petitioner’s approach, given subcontractor is not in a position to its purchases from PRC entities that the Act directs the Department to exercise control or restraint over Funai reasonably reflect the costs associated employ a factors of production Hong Kong, as the technical know-how, with the production and sale of a PCB. methodology only in cases involving designs, and equipment needed to Therefore, in determining the cost of the non-market economy producers. In manufacture the PCBs are all owned and PCBs under the major input rule for contrast, in cases involving market controlled by Funai Hong Kong. purposes of the preliminary economy producers, section 773(f)(1)(A) Moreover, Funai Hong Kong and the determination, we have relied upon the of the Act requires the Department to subcontractor have not entered into costs stated in this company’s normal calculate costs on the basis of a formal exclusive supplier arrangements books and records. company’s financial records, provided which would prohibit this company Price-to-CV Comparisons that such records are maintained in from sourcing its PCB assembly accordance with generally accepted elsewhere or the subcontractor from In accordance with section 773(a)(4) accounting principles (GAAP) and assembling merchandise for other of the Tariff Act, we based NV on CV reasonably reflect the costs associated producers. Thus, we find that the because there was no viable home or with the production and sale of the indicia of control necessary to find these third-country market. merchandise. See Certain Welded parties affiliated are not present here. For comparisons to EP, we made Carbon Steel Pipes and Tubes From Given these factual conclusions, we circumstances-of-sale adjustments by Thailand: Final Results of Antidumping disagree with the petitioners that it deducting home market direct selling Duty Administrative Review, 64 FR would be appropriate to determine the expenses and adding U.S. direct selling 56759–02 (Oct. 21, 1999); see also cost of producing the PCBs using a expenses. We made no adjustment for Notice of Final Results of Antidumping factors of production methodology differences in credit expenses between Duty Administrative Review and based on the production experience of markets because we had inadequate Determination Not To Revoke the the subcontractor because the Chinese information to do so.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66815

When we compared CV to CEP, we during an immediately preceding period To determine whether imports of deducted from CV the weighted-average of comparable duration, the Secretary subject merchandise have been massive home market direct selling expenses. will not consider the imports massive.’’ over a relatively short period, we For a discussion of the calculation of In accordance with 19 CFR 351.206(i), compared the respondent’s export these expenses, see the memorandum the Department defines ‘‘relatively short volumes for the four months before the from Michael Strollo to the File entitled: period’’ as generally the period filing of the petition (i.e., January Calculations Performed for Funai beginning on the date the proceeding through April 2003) to that during the Electric (Malaysia) Sdn. Bhd. (Funai begins (i.e., the date the petition is filed) four months after the filing of the Malaysia) for the Preliminary and ending at least three months later. petition (i.e., May through August Determination in the 2002–2003 In determining whether the above 2003). These periods were selected Antidumping Duty Investigation of statutory criteria have been satisfied, we based on the Department’s practice of Certain Color Television Receivers from examined: (1) the evidence presented in using the longest period for which Malaysia, dated November 21, 2003. the petitioners’ submission of October information is available from the month 16, 2003; (2) exporter-specific shipment that the petition was filed through the Currency Conversion data requested by the Department; and effective date of the preliminary We made currency conversions into (3) the ITC preliminary injury determination. U.S. dollars in accordance with section determination. The Department requested and 773A(a) of the Act based on the To determine whether a history of obtained from Funai Malaysia monthly exchange rates in effect on the dates of dumping and material injury exists, the shipment data for 2001, 2002, and 2003. the U.S. sales as certified by the Federal Department generally considers current According to its monthly shipment Reserve Bank. or previous antidumping duty orders on information, we found the volume of the subject merchandise from the Critical Circumstances shipments of CTVs increased by more country in question in the United States than 15 percent. However, in comparing On October 16, 2003, the petitioners and current orders in any other country. the time series data for the two years alleged that there is a reasonable basis The Department will normally not prior to the petition (i.e., 2001 and to believe or suspect critical consider the initiation of a case, or a 2002), we note that there have also been circumstances exist with respect to the preliminary or final determination of significant surges in imports from Funai antidumping investigation of CTVs from sales at LTFV in the absence of an Malaysia between those same base and Malaysia. In accordance with 19 CFR affirmative finding of material injury by comparison periods. In Certain Color 351.206(c)(2)(i), because petitioners the ITC, as indicative of a history Television Receivers from China and submitted a critical circumstances sufficient to satisfy this criterion. See Malaysia, Investigations Nos. 731–TA– allegation more than 20 days before the Preliminary Determination of Critical 1034 and 1035 (Preliminary), USITC scheduled date of the preliminary Circumstances: Steel Concrete Pub. No. 3607 (ITC Prelim), the ITC determination, the Department must Reinforcing Bars From Ukraine and indicated that subject imports of CTVs: issue its preliminary critical Moldova, 65 FR 70696 (Nov. 27, 2000). (1) Account for only a small percentage circumstances determination not later With regard to imports of CTVs from of everyday sales; (2) represent the bulk than the date of the preliminary Malaysia, the European Union (EU) of product advertised and sold during determination. imposed antidumping duty measures on the holiday season; and (3) arrive in Section 733(e)(1) of the Act provides CTVs from Malaysia in 1995. Because containers months before in preparation that the Department, upon receipt of a there is a history of dumping and for the holiday season. See ITC Prelim timely allegation of critical material injury by reason of dumped at 17–18. Therefore, based on the time circumstances, will determine whether imports in the EU of the subject series data and the information there is a reasonable basis to believe or merchandise, the first criterion of the contained in the ITC Prelim, we suspect that: (A)(i) there is a history of test for finding critical circumstances is conclude that imports of CTVs are dumping and material injury by reason met. subject to seasonal trends. Moreover, of dumped imports in the United States Because we have preliminarily found our analysis shows that these seasonal or elsewhere of the subject merchandise, that section 733(e)(1)(A) of the Act is trends account for the increase in or (ii) the person by whom, or for whose met, we must consider whether under imports during the time periods account, the merchandise was imported section 733(e)(1)(B) of the Act imports examined. Consequently, despite the knew or should have known that the of the merchandise have been massive greater than 15 percent increase in exporter was selling the subject over a relatively short period. According imports from Funai Malaysia between merchandise at less than its fair value to 19 CFR 351.206(h), we consider the the base and comparison periods, we and there was likely to be material following to determine whether imports find that subject imports are not injury by reason of such sales, and (B) have been massive over a relatively considered ‘‘massive’’ pursuant to 19 there have been massive imports of the short period of time: (1) The volume and CFR 351.206(h)(1)(ii). See the subject merchandise over a relatively value of the imports; (2) seasonal trends memorandum from The CTVs Team to short period. (if applicable); and (3) the share of Louis Apple, Director, entitled: According to 19 CFR 351.206(h)(1), in domestic consumption accounted for by ‘‘Antidumping Duty Investigation of determining whether imports of the the imports. Certain Color Televisions from subject merchandise have been When examining volume and value Malaysia—Preliminary Negative ‘‘massive,’’ the Department normally data, the Department typically compares Determination of Critical will examine: (i) The volume and value the export volume for equal periods Circumstances,’’ (Critical Circumstances of the imports; (ii) seasonal trends; and immediately preceding an following the Memo) dated November 21, 2003. (iii) the share of domestic consumption filing of the petition. Unless the imports It is also the Department’s practice to accounted for by the imports. In in the comparison period have conduct its critical circumstances addition, 19 CFR 351.206(h)(2) provides increased by at least 15 percent over the analysis of companies in the ‘‘All that ‘‘unless the imports during a imports during the base period, we will Others’’ category based on the ‘‘relatively short period’’ have increased not consider, under 19 CFR 351.206(h), experience of the investigated by at least 15 percent over the imports the imports to have been ‘‘massive.’’ companies. Because we are determining

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66816 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

that critical circumstances do not exist Rebuttal briefs must be filed five days (202) 482–0651 or (202) 482–4195, for Funai Malaysia, and Funai Malaysia from the deadline date for case briefs. A respectively; AD/CVD Enforcement, is the only respondent in this list of authorities used, a table of Office 4, Group II, Import investigation, we are concluding that contents, and an executive summary of Administration, Room 1870, critical circumstances do not exist for issues should accompany any briefs International Trade Administration, companies covered by the ‘‘All Others’’ submitted to the Department. Executive U.S. Department of Commerce, 14th rate. summaries should be limited to five Street and Constitution Avenue, NW., In summary, we find that there is a pages total, including footnotes. See 19 Washington, DC 20230. reasonable basis to believe or suspect CFR 351.309. SUPPLEMENTARY INFORMATION: importers had knowledge of dumping Section 774 of the Act provides that and the likelihood of material injury the Department will hold a hearing to Statutory Time Limits with respect to CTVs from the PRC. We, afford interested parties an opportunity Section 733(b)(1)(A) of the Tariff Act however, do not find that there have to comment on arguments raised in case of 1930, as amended (the Act), requires been massive imports of CTVs over a briefs, provided that such a hearing is the Department of Commerce (the relatively short period from Funai requested by any interested party. If a Department) to issue the preliminary Malaysia due to seasonality. Given the request for a hearing is made in this determination of an antidumping duty analysis summarized above, and investigation, the hearing will investigation within 140 days after the described in more detail in the Critical tentatively be held two days after the date of initiation. However, if the Circumstances Memo, we preliminarily deadline for submission of the rebuttal petitioner makes a timely request for an determine that critical circumstances do briefs, at the U.S. Department of extension of the period, section not exist for imports of CTVs produced Commerce, 14th Street and Constitution 733(c)(1)(A) of the Act allows the in and exported from Malaysia. Avenue, NW., Washington, DC 20230. Department to postpone the preliminary Verification Parties should confirm by telephone the determination until not later than 190 time, date, and place of the hearing 48 days after the date of initiation. As provided in section 782(i) of the hours before the scheduled time. Background Act, we will verify all information relied Interested parties who wish to request a upon in making our final determination. hearing, or to participate if one is On July 21, 2003, the Department Suspension of Liquidation requested, must submit a written initiated an antidumping duty request within 10 days of the investigation on floor-standing, metal- Weighted- publication of this notice. Requests top ironing tables and certain parts Exporter/man- average Critical cir- should specify the number of thereof from the People’s Republic of ufacturer margin per- cumstances China. See Notice of Initiation of centage participants and provide a list of the issues to be discussed. Oral Antidumping Investigation: Floor- Funai Electric 0.03 No. presentations will be limited to issues Standing, Metal-Top Ironing Tables and (Malaysia) raised in the briefs. See 19 CFR 351.310. Certain Parts Thereof from the People’s Sdn. Bhd. We will make our final determination Republic of China, 68 FR 44040 (July 25, no later than 135 days after the date of 2003). The notice states that the Because the estimated weighted- this preliminary determination, Department will issue its preliminary average dumping margin for the pursuant to section 735(a)(1) of the Act. determination no later than 140 days examined company is de minimis, we This determination is issued and after the date of initiation. The are not directing Customs and Border published pursuant to sections 733(f) preliminary determination currently is Protection to suspend liquidation of and 777(i) of the Act. due no later than , 2003. entries of certain color television Dated: November 21, 2003. receivers from Malaysia. Extension of Preliminary Determination James J. Jochum, On , 2003, the Department Disclosure Assistant Secretary for Import received a timely request for The Department will disclose Administration. postponement of the preliminary calculations performed within five days [FR Doc. 03–29722 Filed 11–26–03; 8:45 am] determination from Home Products of the date of publication of this notice BILLING CODE 3510–DS–P International, Inc. (the petitioner), in to the parties in this proceeding in accordance with section 733(c)(1)(A) of accordance with 19 CFR 351.224(b). the Act and 19 CFR 351.205(e). The DEPARTMENT OF COMMERCE ITC Notification Department has reviewed the Internationl Trade Administration petitioner’s request for postponement In accordance with section 733(f) of and agrees to postpone this preliminary the Act, we have notified the ITC of our [A–570–888] determination. Therefore, pursuant to determination. If our final section 733(c)(1)(A) of the Act, the determination is affirmative, pursuant to Floor-Standing, Metal-Top Ironing Department is postponing the section 735(b)(3) of the Act, the ITC will Tables and Certain Parts Thereof From preliminary determination until January determine within 135 days after our the People’s Republic of China: 26, 2004. final determination whether these Postponement of Preliminary This notice of postponement is in imports are materially injuring, or Determination of Antidumping Duty accordance with section 733(c)(2) of the threaten material injury to, the U.S. Investigation Act and 19 CFR 351.205(f). industry. AGENCY: Import Administration, Dated: November 21, 2003. Public Comment International Trade Administration, James J. Jochum, Case briefs for this investigation must Department of Commerce. Assistant Secretary for Import be submitted no later than seven days EFFECTIVE DATE: November 28, 2003. Administration. after the date of the final verification FOR FURTHER INFORMATION CONTACT: [FR Doc. 03–29719 Filed 11–26–03; 8:45 am] report issued in this proceeding. Paige Rivas or Sam Zengotitabengoa at BILLING CODE 3510–DS–P

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00021 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66817

DEPARTMENT OF COMMERCE Rescission of Review (or via the Internet at [email protected]). International Trade Administration Pursuant to 19 CFR 351.213(d)(1), the Department will rescind an SUPPLEMENTARY INFORMATION: [A 588–707] administrative review if a party that I. Abstract requested the review withdraws the Granular Polytetrafluroetheylene Resin request within 90 days of the date of The marine mammal stranding report From Japan: Rescission of publication of the notice of initiation of provides information on strandings so Antidumping Duty Administrative the requested review. Because AGF that the National Marine Fisheries Review submitted its request for rescission Service (NMFS) can compile and AGENCY: Import Administration, within the 90-day time limit and there analyze by region the species, numbers, International Trade Administration, were no requests for a review from other conditions, and causes of illnesses and Department of Commerce. interested parties, we are rescinding this deaths in stranded marine mammals. ACTION: Notice of rescission of review. As such, we will issue The Agency requires this information to antidumping duty administrative appropriate appraisement instructions fulfill its management responsibilities review. directly to the U.S. Customs and Border under the Marine Mammal Protection Protection. Act (16 U.S.C. 1421a). The Agency is SUMMARY: On September 30, 2003, the This notice is in accordance with also responsible for the welfare of Department of Commerce initiated an section 777(i) of the Act and 19 CFR marine mammals while in rehabilitation administrative review of the 351.213(d)(4). status. The data from the marine antidumping duty order on granular Dated: November 21, 2003. mammal rehabilitation disposition polytetrafluoroetheylene resin from report are required for monitoring and Jeffrey May, Japan for the period August 1, 2002, tracking of marine mammals held at through July 31, 2003. The Department Deputy Assistant Secretary, Import various NMFS-authorized facilities. Administration. is rescinding this review after receiving This information is submitted primarily timely withdrawals from the parties [FR Doc. 03–29718 Filed 11–26–03; 8:45 am] by volunteer members of the marine requesting the review. BILLING CODE 3510–DS–M mammal stranding networks who are EFFECTIVE DATE: November 28, 2003. authorized by the Agency. FOR FURTHER INFORMATION CONTACT: DEPARTMENT OF COMMERCE II. Method of Collection Dunyako Ahmadu or Richard Rimlinger, AD/CVD Enforcement 3, Import National Oceanic and Atmospheric Paper forms are used. Online entry of Administration, International Trade Administration data into the national database is also Administration, U.S. Department of used. [I.D.112103B] Commerce, 14th Street and Constitution III. Data Avenue, NW., Washington, DC 20230; Proposed Information Collection; OMB Number: 0648–0178. telephone (202) 482–0198 or (202) 482– Comment Request; Marine Mammal 4477, respectively. Form Number: NOAA Form 89–864. Stranding Report/Marine Mammal Type of Review: Regular submission. Background Rehabilitation Disposition Report Affected Public: Not-for-profit On August 1, 2003, the Department of AGENCY: National Oceanic and institutions; business or other for-profit Commerce (the Department) published Atmospheric Administration (NOAA). organizations; Federal government; and State, Local, or Tribal Government. in the Federal Register a notice of ACTION: Notice. opportunity to request an administrative Estimated Number of Respondents: review of the antidumping duty order SUMMARY: The Department of 400. on granular polytetrafluoroetheylene Commerce, as part of its continuing Estimated Time Per Response: 30 resin from Japan. See Antidumping or effort to reduce paperwork and minutes. Countervailing Duty Order, Finding, or respondent burden, invites the general Estimated Total Annual Burden Suspended Investigation; Opportunity public and other Federal agencies to Hours: 2,400. to Request Administrative Review (68 take this opportunity to comment on Estimated Total Annual Cost to FR 45218). On August 28, 2003, Asahi proposed and/or continuing information Public: $2,500. Glass Fluoropolymers Co., Ltd. and collections, as required by the IV. Request for Comments Asahi Glass Fluoropolymers USA Inc. Paperwork Reduction Act of 1995, (collectively AGF) requested that the Public Law 104–13 (44 U.S.C. Comments are invited on: (a) whether Department conduct an administrative 3506(c)(2)(A)). the proposed collection of information review of AGF’s exports and imports for is necessary for the proper performance DATES: Written comments must be the period August 1, 2002, through July of the functions of the agency, including submitted on or before January 27, 2004. 31, 2003. On September 30, 2003, the whether the information shall have Department published in the Federal ADDRESSES: Direct all written comments practical utility; (b) the accuracy of the Register a notice of initiation of this to Diana Hynek, Departmental agency’s estimate of the burden administrative review. See Notice of Paperwork Clearance Officer, (including hours and cost) of the Initiation of Antidumping and Department of Commerce, Room 6625, proposed collection of information; (c) Countervailing Duty Administrative 14th and Constitution Avenue, NW, ways to enhance the quality, utility, and Reviews, Request for Revocation in Part Washington, DC 20230 (or via the clarity of the information to be and Deferral of Administrative Review Internet at [email protected]). collected; and (d) ways to minimize the (68 FR 56262). FOR FURTHER INFORMATION CONTACT: burden of the collection of information On October 20, 2003, AGF withdrew Requests for additional information or on respondents, including through the its request for review and requested that copies of the information collection use of automated collection techniques Department rescind the administrative instrument and instructions should be or other forms of information review. directed to Janet Whaley, 301–713–2322 technology.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00022 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66818 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Comments submitted in response to certain criteria set forth in 15 CFR Part DEPARTMENT OF COMMERCE this notice will be summarized and/or 911. included in the request for OMB National Oceanic and Atmospheric approval of this information collection; II. Method of Collection Administration they also will become a matter of public Applications are submitted on paper [I.D.112103D] record. forms, which can be mailed or faxed to Dated: November 19, 2003. NOAA. Proposed Information Collection; Gwellnar Banks, Comment Request; Red Crab and III. Data Management Analyst, Office of the Chief Exempted Fishing Permit Interactive Voice Response (IVR) System Information Officer. OMB Number: 0648–0157. [FR Doc. 03–29732 Filed 11–26–03; 8:45 am] Collection Form Number: None. BILLING CODE 3510–22–S AGENCY: National Oceanic and Type of Review: Regular submission. Atmospheric Administration (NOAA). Affected Public: Not-for-profit ACTION: Notice. DEPARTMENT OF COMMERCE institutions; business or other for-profit organizations; individuals or SUMMARY: The Department of National Oceanic and Atmospheric Commerce, as part of its continuing Administration households; and State, Local, or Tribal Government. effort to reduce paperwork and [I.D.112103C] respondent burden, invites the general Estimated Number of Respondents: public and other Federal agencies to Proposed Information Collection; 390. take this opportunity to comment on Comment Request; NOAA Space- Estimated Time Per Respons: 3 hours proposed and/or continuing information Based Data Collection System (DCS) for a GOES application, and 1 hour for collections, as required by the Agreements. an Argos application. Paperwork Reduction Act of 1995, Public Law 104–13 (44 U.S.C. AGENCY: National Oceanic and Estimated Total Annual Burden 3506(c)(2)(A)). Atmospheric Administration (NOAA). Hours: 440. ACTION: Notice. Estimated Total Annual Cost to DATES: Written comments must be Public: $488. submitted on or before January 27, 2004. SUMMARY: The Department of ADDRESSES: Direct all written comments Commerce, as part of its continuing IV. Request for Comments to Diana Hynek, Departmental effort to reduce paperwork and Paperwork Clearance Officer, respondent burden, invites the general Comments are invited on: (a) whether Department of Commerce, Room 6625, public and other Federal agencies to the proposed collection of information 14th and Constitution Avenue, NW, take this opportunity to comment on is necessary for the proper performance Washington, DC 20230 (or via the proposed and/or continuing information of the functions of the agency, including Internet at [email protected]). collections, as required by the whether the information shall have FOR FURTHER INFORMATION CONTACT: Paperwork Reduction Act of 1995, practical utility; (b) the accuracy of the Requests for additional information or Public Law 104–13 (44 U.S.C. agency’s estimate of the burden copies of the information collection 3506(c)(2)(A)). (including hours and cost) of the instrument and instructions should be DATES: Written comments must be proposed collection of information; (c) directed to Brian Hooker, National submitted on or before January 27, 2004. ways to enhance the quality, utility, and Marine Fisheries Service, 1 Blackburn ADDRESSES: Direct all written comments clarity of the information to be Drive, Gloucester, MA 01930. to Diana Hynek, Departmental collected; and (d) ways to minimize the SUPPLEMENTARY INFORMATION: Paperwork Clearance Officer, burden of the collection of information Department of Commerce, Room 6625, on respondents, including through the I. Abstract 14th and Constitution Avenue, NW, use of automated collection techniques Vessels with red crab limited access Washington, DC 20230 (or via the or other forms of information permits, or vessels bearing an Exempted Internet at [email protected]). technology. (Experimental) Fishing Permit (EFP), are FOR FURTHER INFORMATION CONTACT: Comments submitted in response to required to report their catches. This Requests for additional information or this notice will be summarized and/or submission seeks to authorize the copies of the information collection included in the request for OMB collection of this information via an Interactive Voice Response (IVR) instrument and instructions should be approval of this information collection; system. The collection of information in directed to Robert Bassett at 301–757– they also will become a matter of public 5681 or at [email protected]. this manner is necessary to monitor record. SUPPLEMENTARY INFORMATION: catch levels in a timely manner, so that Dated: November 19, 2003. effort controls can be implemented I. Abstract Gwellnar Banks, before catch limits are attained. The NOAA operates two space-based data Management Analyst, Office of the Chief information necessary for IVR catch collection systems: the Geostationary Information Officer. reports is a fraction of that required by Operational Environmental Satellite [FR Doc. 03–29733 Filed 11–26–03; 8:45 am] vessel logbooks. (GOES) Data Collection System and the The collection of catch data for red BILLING CODE 3510–22–S Argos Data Collection System. Both crab is authorized at 50 CFR systems are operated to support 648.7(b)(iii), which requires catch environmental applications. Since the reports to be submitted via IVR within entire capacity of the systems is not 24 hours after offloading. The used by NOAA, this extra capacity is authorization for the collection of EFP made available to other users who meet catch reports is at § 600.745(c)(2).

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00023 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66819

Currently the reports are submitted in DEPARTMENT OF COMMERCE of the listed species which are the paper form, but NOAA proposes that subject of the permits; and (3) are some bearers of an EFP be subject to an National Oceanic and Atmospheric consistent with the purposes and IVR reporting requirement and be Administration policies set forth in section 2 of the required to call within 24 hours of the [I.D. 112003D] ESA. Authority to take listed species is start of a fishing trip and within 24 subject to conditions set forth in the hours of landing and offloading. Endangered and Threatened Species; permits. Permits and modifications are Take of Anadromous Fish issued in accordance with and are II. Method of Collection AGENCY: National Marine Fisheries subject to the ESA and NMFS The IVR system is an automated Service (NMFS), National Oceanic and regulations governing listed fish and system that operates electronically. The Atmospheric Administration (NOAA), wildlife permits (50 CFR parts 222 226). respondent is prompted to enter data via Commerce. Those individuals requesting a the keypad of the telephone. It is a toll- ACTION: Receipt of applications for hearing on an application listed in this free call. research permits (1185, 1280, 1452) and notice should set out the specific III. Data request for comment. reasons why a hearing on that application would be appropriate (see SUMMARY: Notice is hereby given that OMB Number: 0648–0212. ADDRESSES). The holding of such a NMFS has received applications for a hearing is at the discretion of the Form Number: None. permit for scientific research from Assistant Administrator for Fisheries, Natural Resource Scientists, Inc (NRS) Type of Review: Regular submission. NOAA. All statements and opinions Affected Public: Business or other for- in Red Bluff, CA (1185), Turlock Irrigation District (TID) in Turlock, CA contained in the permit action profit organizations; individuals or (1280), and California Rivers Restoration summaries are those of the applicant households; not-for-profit institutions; Fund (CRRF) in El Dorado, CA (1452). and do not necessarily reflect the views and State, Local or Tribal Government. The permits would affect federally of NMFS. Estimated Number of Respondents: threatened Central Valley steelhead. Species Covered in This Notice 55. This document serves to notify the Estimated Time Per Response: 4 public of the availability of the permit This notice is relevant to federally minutes. applications for review and comment. threatened Central Valley steelhead DATES: Written comments on the permit (Oncorhynchus mykiss). Estimated Total Annual Burden applications must be received at the Hours: 25. Applications Received appropriate address or fax number (see Estimated Total Annual Cost to ADDRESSES) no later than 5 p.m. Pacific NRS requests a 5–year permit (1185) Public: $0. Standard Time on December 29, 2003. for take of adult and juvenile Central IV. Request for Comments ADDRESSES: Written comments on the Valley steelhead to monitor outmigrant permit applications should be sent to salmonids in the Merced River. NRS Comments are invited on: (a) whether the appropriate office as indicated requests authorization for an estimated the proposed collection of information below. Comments may also be sent via annual take of 5 adult and 10 juvenile is necessary for the proper performance fax to the number indicated for the Central Valley steelhead (with no of the functions of the agency, including request. Comments will not be accepted incidental mortality) resulting from whether the information shall have if submitted via e-mail or the Internet. capturing, measuring, and releasing fish. practical utility; (b) the accuracy of the The applications and related documents TID requests a 5–year permit (1280) agency’s estimate of the burden are available for review by appointment, for take of adult and juvenile Central (including hours and cost) of the for permits 1185, 1280, and 1452: Valley steelhead to study the proposed collection of information; (c) Protected Resources Division, NMFS, relationship between fall-run Chinook ways to enhance the quality, utility, and 650 Capitol Mall, Suite 8–300, salmon outmigration patterns and flow clarity of the information to be Sacramento, CA 95814 (ph:916–930– fluctuation patterns in the Tuolumne collected; and (d) ways to minimize the 3614, fax: 916–930–3629). Documents may also be reviewed by appointment in River. TID requests authorization for an burden of the collection of information the Office of Protected Resources, F/ estimated annual take of 36 juvenile on respondents, including through the PR3, NMFS, 1315 East-West Highway, Central Valley steelhead (number use of automated collection techniques Silver Spring, MD 20910 3226 (301– includes 3 percent incidental mortality) or other forms of information 713–1401). and 5 adult Central Valley steelhead (no technology. FOR FURTHER INFORMATION CONTACT: incidental mortality) resulting from Comments submitted in response to Rosalie del Rosario at phone number seining, trapping, electrofishing, and this notice will be summarized and/or 916–930–3614, or e-mail: angling activities. CRRF requests a 3– included in the request for OMB [email protected]. year permit (1452) to measure and approval of this information collection; SUPPLEMENTARY INFORMATION: collect scale samples from adult O. they also will become a matter of public mykiss using hook and line and adult record. Authority carcasses in the lower Tuolumne River. Dated: November 19, 2003. Issuance of permits and permit CRRF requests authorization for an Gwellnar Banks, modifications, as required by the estimated annual take of 340 adult Endangered Species Act of 1973 (16 Management Analyst, Office of the Chief Central Valley steelhead, with less than U.S.C. 1531–1543) (ESA), is based on a Information Officer. 1 percent incidental mortality, resulting finding that such permits/modifications: from capture by hook and line fishing. [FR Doc. 03–29734 Filed 11–26–03; 8:45 am] (1) are applied for in good faith; (2) BILLING CODE 3510–22–S would not operate to the disadvantage

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00024 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66820 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Dated: November 21, 2003. publication date of the Environmental east of this previously mined area, on a Lamont D. Jackson, Protection Agency’s published notice in low terrace above the 100–year Acting Chief, Endangered Species Division, the Federal Register. floodplain. This 178–acre (72.0 ha) Office of Protected Resources, National ADDRESSES: See SUPPLEMENTARY parcel contains high quality sand and Marine Fisheries Service. INFORMATION section for addresses of gravel deposits that have not been [FR Doc. 03–29731 Filed 11–26–03; 8:45 am] locations at which hard-copies of the mined. Current operations on this parcel BILLING CODE 3510–22–S Plan and associated documents may be include cattle grazing and hay and crop obtained or reviewed. To request production. documents on CD-ROM, call the Storedahl proposes to mine the sand DEPARTMENT OF COMMERCE USFWS at (360) 534–9330. and gravel deposits from 101 acres (40.9 Comments and requests for ha) of this 178–acre parcel, and National Oceanic and Atmospheric information should be sent to Tim continue processing operations at the Administration Romanski, Storedahl FEIS/HCP other parcel. These operations would Comments, U.S. Fish and Wildlife continue until sand and gravel DEPARTMENT OF THE INTERIOR Service, 510 Desmond Drive, S.E., Suite extraction at the 178–acre parcel is complete, projected to be 15 years or Fish and Wildlife Service 102, Lacey, Washington 98503–1263, telephone (360) 753–5823, facsimile less. Concurrent with, and following [I.D.110503G] (360) 753–9518. Comments and sand and gravel extraction, Storedahl materials received will be available for would implement a site reclamation Final Environmental Impact Statement public inspection, by appointment, plan. for an Incidental Take Permit during normal business hours at the The proposed mining, processing, and Application and Habitat Conservation above address. reclamation activities have the potential Plan (Plan), by J.L. Storedahl & Sons, to affect fish and wildlife associated FOR FURTHER INFORMATION CONTACT: Tim Inc.(Storedahl), Clark County, WA with the East Fork Lewis River Romanski, Project Manager, U.S. Fish ecosystem. The majority of the gravel to AGENCY: National Marine Fisheries and Wildlife Service, (360) 753–5823; or be mined is located just below the water Service, National Oceanic and Laura Hamilton, Project Manager, table in a shallow aquifer, and the Atmospheric Administration (NOAA), National Marine Fisheries Service, (360) proposed gravel mining and reclamation Commerce; U.S. Fish and Wildlife 753–5820. plan would create a series of open water Service (USFWS), Interior. SUPPLEMENTARY INFORMATION: Hard ponds and emergent wetlands. The ACTION: Notice of availability of final bound copies are available for viewing, created ponds and wetlands would environmental impact statement. or duplication, at the following libraries: drain via a controlled outlet to a small Woodland Community Library, 770 Park creek (Dean Creek) and then to the East SUMMARY: This document announces the St, Woodland, WA (360) 225–2115; Fork Lewis River. The shallow aquifer is availability of the Final Environmental Battle Ground Community Library, 12 Impact Statement (Statement) for public connected to the East Fork Lewis River. W Main St. Battle Ground, WA (360) The proposed mining and reclamation review. The Statement addresses the 687–2322; Ridgefield Community proposed issuance of Incidental Take plan has the potential to affect a suite Library, 210 N Main Ave, Ridgefield, of habitat conditions, including, but not Permits (Permits) to J.L. Storedahl & WA (350)887–8281; Vancouver Sons, Inc., Clark County, WA. The limited to, water quality, channel Community Library, 1007 E Mill Plain proposed Permits relate to gravel morphology, riparian function, off- Blvd, Vancouver, WA (360) 695–1566; mining, gravel processing, and mining channel connections, and the and, Olympia Timberland Library, reclamation activities on approximately conversion of pastureland to forest, Reference Desk, 313 8th Avenue SE, 300 acres of Storedahl-owned lands wetland, and open water habitats. Some Olympia, WA (360)352–0595. adjacent to the East Fork Lewis River, of these effects could involve species Clark County, WA. The proposed Background subject to protection under the ESA. Section 10 of the ESA contains Permits would authorize the take of the J.L. Storedahl & Sons, Inc., owns and provisions for the issuance of Incidental following threatened species incidental operates a gravel processing plant in Take Permits to non-Federal land to otherwise lawful activities: steelhead rural Clark County, WA, adjacent the owners for the take of endangered and (Oncorhynchus mykiss), bull trout East Fork Lewis River. This site is threatened species. Any such take must (Salvelinus confluentus), chum salmon known as the Daybreak Mine. It is be incidental to otherwise lawful (Oncorhynchus keta), and Chinook located approximately 4 miles (6.4 activities, and must not appreciably salmon (Oncorhynchus tshawytscha). km)southeast of the town of LaCenter, reduce the likelihood of the survival Storedahl is also seeking coverage for and approximately 1 mile (1.6 km) and recovery of the species in the wild. five currently unlisted species downstream of Clark County’s Daybreak As required under the Permit (including anadromous and resident Park. The 300–acre (121.4 ha) site is application process, Storedahl has fish) under specific provisions of the composed of two parcels. One parcel is developed, with assistance from the Permits, should these species be listed approximately 82 acres (33.2 ha) and Services, a Habitat Conservation Plan in the future. The duration of the consists of five pits, which were mined (Plan) containing a strategy for proposed Permits is 25 years. This intermittently, under different owners, minimizing and mitigating take notice is provided pursuant to the from 1968 to 1995. No active extraction associated with the proposed activities Endangered Species Act (ESA) and of gravel from this site is now occurring. to the maximum extent practicable for National Environmental Policy Act Current operations are limited to their proposed activities adjacent to the (NEPA). processing and distributing sand and East Fork Lewis River. DATES: Written comments on the gravel that is mined off-site. Processing Activities proposed for coverage Statement must be received from all involves separating the sand from the under the Permits include the following: interested parties on or before December gravel, and separating the gravel into (1) Gravel mining and related 29, 2003. A Record of Decision will different size classes. The second parcel activities in the terrace above the 100– occur no sooner than 30 days after the is located immediately to the north and year floodplain, with potential impacts

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00025 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66821

on groundwater quality and quantity, (2) Alternative A–2: Mine the DEPARTMENT OF COMMERCE potential impacts on surface water property without an ITP and avoid take quality and quantity, potential influence - No Action. National Oceanic and Atmospheric Administration on channel migration, and potential (3) Alternative B: Mine and undertake access to gravel ponds by anadromous habitat enhancement and reclamation [I.D. 112403B] salmonids. activity at the Daybreak property (2) Gravel processing. implementing the May 2001 Public Gulf of Mexico Fishery Management Council; Public Meeting (3) Site reclamation activities Review Draft HCP - Preferred including, but not limited to, the Alternative. AGENCY: National Marine Fisheries creation of emergent and open water Service (NMFS), National Oceanic and wetland habitat and riparian and valley- (4) Alternative C: Mine and undertake habitat enhancement and reclamation Atmospheric Administration (NOAA), bottom forest restoration; habitat Commerce. rehabilitation, riparian irrigation, and activity at the Daybreak property ACTION: low flow augmentation to Dean Creek; following design and conservation Notice of public meeting. measures presented to the Services in and construction of facilities (such as SUMMARY: The Gulf of Mexico Fishery July, 2000. trails and parking lots) to support future Management Council (Council) will incorporation of the site into the open One alternative was considered convene a joint public meeting via space and greenbelt reserve. during scoping but not analyzed in conference call of the Standing and (4) Monitoring and maintenance of detail. That alternative is essentially a Special Reef Fish Scientific and conservation measures. combination of the two no-action Statistical Committee (SSC). The duration of the proposed Permits alternatives listed above, Alternatives DATES: The meeting will be via and Plan is 25 years, though some A–1 and A–2. That alternative would conference call on , 2003 aspects of the conservation measures have involved mining on the portion of beginning at 10 a.m. EDT. associated with the proposed Plan the property currently zoned for mining, ADDRESSES: Listening stations will be would continue in-perpetuity. with subsequent partitioning and sale of available at the following locations: The Services formally initiated an the mined and unmined property for NMFS Southeast Regional Office, environmental review of the project low-density rural residential 9721 Executive Center Drive, North, St. through publication of a Notice of Intent development. This was dismissed from Petersburg, FL 33702; Contact: Peter to prepare an Environmental Impact detailed analysis because the vast Hood at 727-570-5305; Statement in the Federal Register on majority of marketable sand and gravel NMFS Panama City Laboratory, 3500 , 1999 (64 FR 72318). That on the portion of the property currently Delwood Beach Road, Panama City, FL; notice also announced a 30–day public zoned for mining has already been Contact: Gary Fitzhugh at 850-234-6541, scoping period during which interested extracted, rendering the alternative not extension 214. parties were invited to provide written feasible. Council address: Gulf of Mexico comments expressing their issues or Fishery Management Council, 3018 U.S. concerns relating to the proposal. A This notice is provided pursuant to Highway 301 North, Suite 1000, Tampa, second Federal Register notice was section 10(a) of the ESA, and NEPA FL 33619. regulations. The Services will evaluate published on , 2002 (67 FR FOR FURTHER INFORMATION CONTACT: the application, associated documents, 70408), announcing a 60–day public Steven Atran, Population Dynamics comment period for a draft Statement, and comments submitted thereon to Statistician, Gulf of Mexico Fishery draft Plan with appendices, and a draft determine whether the application Management Council; telephone: 813- Implementing Agreement. The comment meets the requirements of the ESA and 228-2815. period was extended an additional 30 NEPA. If it is determined that the SUPPLEMENTARY INFORMATION: The SSC days in direct response to requests from requirements are met, Permits will be will be convened to evaluate the the public. This resulted in a total issued for the incidental take of listed socioeconomic information contained in comment period of 90 days. Comments species. The final permit decision will Reef Fish Secretarial Amendment 1, red received on the draft documents and be made no sooner than 30 days from grouper rebuilding plan and deep-water responses to those comments are the date of this notice. grouper quotas. The SSC will be asked included in the final Statement. Dated: October 30, 2003. specifically to provide the Council with The final Statement compares David J. Wesley, guidance on the economic impacts of Storedahl’s proposal against two no- trip limits vs. closed seasons. action alternatives. Differences between Deputy Regional Director, Fish and Wildlife Service, Region 1, Portland Oregon. Red grouper were declared overfished the no-action alternatives and the by NMFS in October 2000. Following proposed action are considered to be the November 10, 2003. additional analyses and a subsequent effects that would occur if the proposed Phil Williams, stock assessment in 2002, the Council, action were implemented. One Chief, Endangered Species Division, Office in May 2003, submitted Reef Fish alternative to Storedahl’s proposal is Secretarial Amendment 1 to NMFS. also analyzed against the two no-action of Protected Resources, National Marine Fisheries Service. This amendment contained a rebuilding alternatives. The analysis comparing [FR Doc. 03–29730 Filed 11–26–03; 8:45 am] plan that called for approximately a 10 these alternatives is contained in the percent reduction in harvest, to be BILLING CODES 3510–22–S, 4310–55–S final Statement. achieved through a reduction in the Alternatives considered in the commercial shallow-water grouper analysis include the following: quota, replacing the to (1) Alternative A–1: Partition the March 15 commercial closed season on property into 20–acre (8.1 ha) parcels gag, red and black grouper with a and sell as rural residential/agricultural shallow-water grouper trip limit, and a tracts - No Action. recreational bag limit of no more than

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00026 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66822 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

two red grouper (out of the 5 aggregate this notice and any issues arising after Respondent’s Obligation: Required to grouper bag limit). The rebuilding plan publication of this notice that require obtain or retain benefits. also proposed a reduction in the deep- emergency action under section 305(c) Pamela Fitzgerald, water grouper quota and setting of a of the MSFCMA, provided the public tilefish quota in order to discourage has been notified of the Council’s intent Air Force Federal Register Liaison Officer. effort shifting to those stocks. Because to take final action to address the [FR Doc. 03–29710 Filed 11–26–03; 8:45 am] more than one year had passed since the emergency. BILLING CODE 3810–01–P designation of red grouper as The listening stations are physically overfished, the amendment was accessible to people with disabilities. submitted as a Secretarial Amendment Requests for sign language DEFENSE NUCLEAR FACILITIES rather than as a Council Plan interpretation or other auxiliary aids SAFETY BOARD Amendment. should be directed to Anne Alford at the Sunshine Act; Notice of Meeting NMFS reviewed the plan as submitted Council (see ADDRESSES) by December by the Gulf Council and made revisions 5, 2003. Pursuant to the provisions of the to it. The revisions included retaining ‘‘Government in the Sunshine Act’’ (5 the February 15-March 15 commercial Dated: November 24, 2003. Richard W. Surdi, U.S.C. 552b), notice is hereby given of closed season, implementing a hard the Defense Nuclear Facilities Safety quota on red grouper so that the Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service. Board’s (Board) meeting described commercial shallow-water grouper below. The Board will also conduct a [FR Doc. 03–29737 Filed 11–26–03; 8:45 am] fishery will close when either the red series of public hearings pursuant to 42 grouper or shallow-water grouper quota BILLING CODE 3510–22–S U.S.C. 2286b and invites any interested is met, whichever comes first, and not persons or groups to present any implementing a trip limit. comments, technical information, or A draft of the revised Secretarial data concerning safety issues related to DEPARTMENT OF DEFENSE Amendment was reviewed by the SSC at the matters to be considered. a meeting held -29, 2003. TIME AND DATE OF MEETING: 9 a.m., However, the NMFS revisions were not Office of the Secretary December 16, 2003. provided to the SSC until just prior to Submission for OMB Review; the meeting, and the SSC was unable to PLACE: Defense Nuclear Facilities Safety Comment Request review the socioeconomic information Board, Public Hearing Room, 625 contained in the amendment’s Indiana Avenue, NW., Suite 300, ACTION: Notice. regulatory impact review section. At the Washington, DC 20004–2001. -12, 2003 Council meeting Additionally, as a part of the Board’s E- The Department of Defense has Government initiative, the meeting will in Biloxi, Mississippi, Council members submitted to OMB for clearance, the debated whether it would be less be presented live through Internet video following proposal for collection of streaming. A link to the presentation economically disruptive to the information under the provisions of the commercial shallow-water grouper will be available on the Board’s Web site Paperwork Reduction Act (44 U.S.C. (http://www.dnfsb.gov). fishery to have a potential quota closure Chapter 35). or a shallow-water grouper trip limit set STATUS: Open. While the Government in Title, Form Number, and OMB the Sunshine Act does not require that low enough to prevent a quota closure. Number: Civil Aircraft Landing Permit Since the Council will have another the scheduled discussion be conducted System; OMB Number 0701–0050; DD in a meeting, the Board has determined opportunity to review and comment on Form 2400, 2401, 2402; OMB Number Secretarial Amendment 1 at its January that an open meeting in this specific 0701–0050. case furthers the public interests 12-16, 2004 meeting in Austin, TX, the Type of Request: Reinstatement. Council decided to ask the SSC to underlying both the Sunshine Act and Number of Respondents: 3,600. reconvene by conference call to evaluate the Board’s enabling legislation. Responses per Respondent: 1. the socioeconomic information in the MATTERS TO BE CONSIDERED: The Board amendment, with particular emphasis Annual Responses: 3,600. has been reviewing the Department of on the economic impacts of trip limits Average Burden per Response: 30 Energy’s (DOE) current oversight and vs. closed seasons. minutes. management of the contracts and To obtain a copy of Reef Fish Annual Burden Hours: 1,800. contractors it relies upon to accomplish Secretarial Amendment 1, contact Phil Needs and Uses: The information the mission assigned to DOE under the Steele, NMFS Southeast Regional Office, collection requirement is necessary to Atomic Energy Act of 1954, as amended. 9721 Executive Center Drive, North, St. ensure that the security and operational We will focus on what impact, if any, Petersburg, FL 33702; telephone: 727- integrity of military airfields are DOE’s new initiatives may have or 570-5305, fax: 727-570-5583, e-mail: maintained; to identify the aircraft might have had upon assuring adequate [email protected] operator and the aircraft to be operated; protection of the health and safety of the A copy of the agenda can be obtained to avoid competition with the private public and workers at DOE’s defense by contacting the Council (see addresses sector by establishing the purpose for nuclear facilities. The sixth public above). use of military airfields; and to ensure meeting will collect information needed Although non-emergency issues not the U.S. Government is not held liable to understand and address any health or contained in the agenda may come if the civil aircraft becomes involved in safety concerns that may require Board before the AP/SSC for discussion, in an accident or incident while using action. This will include, but is not accordance with the Magnuson-Stevens military airfields, facilities, and limited to, presentations by the National Fishery Conservation and Management services. Nuclear Security Administration Act (MSFCMA), those issues may not be Affected Public: Business of Other (NNSA) to explain their contract the subject of formal action during this For-Profit; Not-For-Profit Institutions; management and oversight initiatives meeting. Action will be restricted to Individuals or Households. and possibly further presentations by those issues specifically identified in Frequency: On Occasion. Board staff.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00027 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66823

The Board has identified several key Dated: November 24, 2003. Dated: November 24, 2003. areas that will be examined in public John T. Conway, Angela C. Arrington, meetings. In the December 16th Chairman. Leader, Regulatory Information Management meeting, the Board will explore in more [FR Doc. 03–29825 Filed 11–25–03; 1:14 pm] Group, Office of the Chief Information Officer. depth the field application of Federal BILLING CODE 3670–01–P management and oversight policies Institute of Education Sciences being developed by DOE and NNSA for Type of Review: Reinstatement. defense nuclear facilities. The Board will hear from NNSA Site Managers and DEPARTMENT OF EDUCATION Title: School Survey on Crime and Contractor General Managers. The Safety: 2004 (SSOCS: 2004). information gathered will explore Submission for OMB Review; Frequency: Every four years. Comment Request Federal contract management and Affected Public: State, Local, or Tribal oversight experience and will provide AGENCY: Department of Education. Gov’t, SEAs or LEAs. relevant reference experience. The SUMMARY: The Leader, Regulatory Reporting and Recordkeeping Hour public hearing portion is independently Information Management Group, Office Burden: authorized by 42 U.S.C. 2286b. of the Chief Information Officer invites Responses: 2,550. FOR FURTHER INFORMATION CONTACT: comments on the submission for OMB Burden Hours: 2,703. Kenneth M. Pusateri, General Manager, review as required by the Paperwork Defense Nuclear Facilities Safety Board, Reduction Act of 1995. Abstract: Authorized under the 625 Indiana Avenue, NW., Suite 700, DATES: Interested persons are invited to Education Sciences Reform Act of 2002, Washington, DC 20004–2901, (800) 788– submit comments on or before the School Survey on Crime and Safety: 4016. This is a toll-free number. December 29, 2003. 2004 (SSOCS) is the only recurring federal survey which collects detailed SUPPLEMENTARY INFORMATION: ADDRESSES: Requests Written comments should information on crime and safety from be addressed to the Office of to speak at the hearing may be the public school principals’ Information and Regulatory Affairs, submitted in writing or by telephone. perspective. The survey collects The Board asks that commentators Attention: Melanie Kadlic, Desk Officer, information on frequency and types of describe the nature and scope of their Department of Education, Office of crimes at schools and disciplinary oral presentation. Those who contact Management and Budget, 725 17th actions; information about perceptions the Board prior to close of business on Street, NW., Room 10235, New of disciplinary problems in school; and December 15, 2003, will be scheduled Executive Office Building, Washington, a description of school policies and for time slots, beginning at DC 20503 or should be electronically programs concerning crime and safety. approximately 11:30 a.m. The Board mailed to the Internet address _ will post a schedule for those speakers Melanie [email protected]. Requests for copies of the submission for OMB review; comment request may who have contacted the Board before SUPPLEMENTARY INFORMATION: Section the hearing. The posting will be made 3506 of the Paperwork Reduction Act of be accessed from http:// at the entrance to the Public Hearing 1995 (44 U.S.C. Chapter 35) requires edicsweb.ed.gov, by selecting the Room at the start the 9 a.m. meeting. that the Office of Management and ‘‘Browse Pending Collections’’ link and by clicking on link number 2352. When Anyone who wishes to comment or Budget (OMB) provide interested provide technical information or data Federal agencies and the public an early you access the information collection, may do so in writing, either in lieu of, opportunity to comment on information click on ‘‘Download Attachments’’ to or in addition to, making an oral collection requests. OMB may amend or view. Written requests for information presentation. The Board Members may waive the requirement for public should be addressed to Vivian Reese, question presenters to the extent consultation to the extent that public Department of Education, 400 Maryland deemed appropriate. Documents will be participation in the approval process Avenue, SW., Room 4050, Regional accepted at the meeting or may be sent would defeat the purpose of the Office Building 3, Washington, DC to the Defense Nuclear Facilities Safety information collection, violate State or 20202–4651 or to the e-mail address Board’s Washington, DC office. The Federal law, or substantially interfere [email protected]. Requests may also Board will hold the record open until with any agency’s ability to perform its be electronically mailed to the Internet _ , 2004, for the receipt of statutory obligations. The Leader, address OCIO [email protected] or faxed to additional materials. A transcript of the Regulatory Information Management 202–708–9346. Please specify the meeting will be made available by the Group, Office of the Chief Information complete title of the information Board for inspection by the public at the Officer, publishes that notice containing collection when making your request. proposed information collection Defense Nuclear Facilities Safety requests prior to submission of these Comments regarding burden and/or Board’s Washington office and at DOE’s requests to OMB. Each proposed the collection activity requirements public reading room at the DOE Federal information collection, grouped by should be directed to Katrina Ingalls at Building, 1000 Independence Avenue, office, contains the following: (1) Type [email protected]. Individuals who SW., Washington, DC 20585. of review requested, e.g. new, revision, use a telecommunications device for the The Board specifically reserves its extension, existing or reinstatement; (2) deaf (TDD) may call the Federal right to further schedule and otherwise Title; (3) Summary of the collection; (4) Information Relay Service (FIRS) at 1– regulate the course of the meeting and Description of the need for, and 800–877–8339. hearing, to recess, reconvene, postpone, proposed use of, the information; (5) [FR Doc. 03–29708 Filed 11–26–03; 8:45 am] or adjourn the meeting and hearing, Respondents and frequency of BILLING CODE 4000–01–P conduct further reviews, and otherwise collection; and (6) Reporting and/or exercise its power under the Atomic Recordkeeping burden. OMB invites Energy Act of 1954, as amended. public comment.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00028 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66824 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

ENVIRONMENTAL PROTECTION EPA also urged a comprehensive Pursuant to 40 CFR 1506.9. AGENCY evaluation of connected actions in EIS No. 030527, Final EIS, AFS, AZ, future NEPA documents related to [ER–FRL–6645–9] Buck Springs Range Allotment proposed power plant development and Rangeland Management, Environmental Impact Statements and construction of a new transmission Implementation, Blue Ridge Coconino Regulations; Availability of EPA pipeline. National Forest, Coconino County, Comments Final EISs AZ, Wait Period Ends: December 29, 2003, Contact: Cathy Taylor (928) ERP No. F–AFS–F65039–WI, McCaslin Availability of EPA comments 477–2255. Project, Vegetation Management prepared pursuant to the Environmental EIS No. 030528, Draft EIS, AFS, CA, Activities Consistent with Direction in Review Process (ERP), under Section McNally/Sherman Pass Restoration the Nicolet Forest Plan, Lakewood/ 309 of the Clean Air Act and Section Project, Proposal to Remove Fire-Kill Laona District, Chequamegon-Nicolet 102(2)(c) of the National Environmental Trees, Road Construction and National Forest, Oconto and Forest Policy Act as amended. Requests for Associated Restoration of the Area copies of EPA comments can be directed Counties, WI. Summary: EPA expressed lack of Burned, Sequoia National Forest, to the Office of Federal Activities at Cannell Meadow Ranger District, (202) 564–7167. objections for this project. ERP No. F–AFS–L67042–OR, Tulare County, CA, Comment Period An explanation of the ratings assigned Ends: January 12, 2004, Contact: Tom to draft environmental impact Steamboat Mountain Mining Operations, Surface Quarry or ‘‘Open Simonso Ext. 1187 (559) 784–1500. statements (EISs) was published in FR EIS No. 030529, Final EIS, AFS, SD, Elk dated April 04, 2003 (68 FR 16511). Pit’’ Mineral Extraction, Plan-of- Operation Approval, Applegate Bugs and Fuels Project, Vegetation Draft EISs Adaptive Management Area, Rogue Management to Reduce the Spread of ERP No. D–AFS–L65436–OR Rating River National Forest, Applegate Ranger Mountain Pine Beetles and the Threat LO, Juncrock Timber Sale Project, Treat District, Jackson County, OR. and Severity of Potential Wildfires, Forest Vegetation, MT. Hood National Summary: EPA has expressed Black Hills National Forest Land and Forest, Barlow Ranger District, Wasco concerns with environmental impacts Resource Management Plan, County, OR. from changes made from the draft EIS to Implementation, Northern Hills Summary: EPA expressed lack of the final EIS regarding the Ranger District, Black Hills National objections. However, EPA recommend transportation route and additional Forest, Lawrence and Meade the final EIS include water quality storage. EPA also continues to have Counties, SD, Wait Period Ends: analysis information on temperature concerns regarding potential adverse December 29, 2003, Contact: Elizabeth and sediment, and address project goals impacts to water quality from chemical Krueger (307) 283–1361. for Northern Spotted Owl habitat. processing, lack of reclamation and EIS No. 030530, Final EIS, USA, NY, ERP No. D–DOE–K08025–00 Rating contingency planning, financial Thomas Jefferson Hall and Other EC2, Sahuartia-Nogales Transmission assurance and adequate monitoring Construction Activities in the Cadet Line, Construction and Operation of a from agency’s preferred alternative. Zone of the United States Military 345,00-volt (345 kV) Electric ERP No. F–FRC–C05148–NY, St. Academy, Implementation, West Transmission Line across the United Lawrence—FDR Hydroelectric Project, Point, Hudson River Valley, Orange States Border with Mexico, Application Application for New License and Putnam Counties, NY, Wait for Presidential Permit, Tucson Electric (Relicense), (FERC No. 200–036), Period Ends: December 29, 2003, Power (TEP), Nogales, AZ. Located on the St. Lawrence River, Contact: Douglas R. Cubbison (845) Summary: EPA expressed concerns Messina, NY. 938–3522. about potential water and air quality Summary: EPA had no objections to EIS No. 030531, Final EIS, AFS, WA, impacts of the project. EPA requested the relicensing of the St. Lawrence— Crupina Integrated Weed Management the final EIS contain information on FDR Hydroelectric Project. Project, Control and Eradication of DOE’s public involvement methods in Dated: November 24, 2003. Crupina, Implementation, Okanogan and Wenatchee National Forests, support of their environmental justice Joseph C. Montgomery, findings and on how identified conflicts Chelan Ranger District, Chelan Director, NEPA Compliance Division, Office County, WA, Wait Period Ends: with affected Tribes will be resolved. of Federal Activities. December 29, 2003, Contact: Mallory EPA also sought clarification on [FR Doc. 03–29689 Filed 11–26–03; 8:45 am] potential transboundary effects, Lenz (509) 682–2576. BILLING CODE 6560–50–P cumulative effects, and the underlying EIS No. 030532, Draft EIS, DOI, UT, basis for selecting the Western Corridor Lower Duchesne River Wetlands as the Preferred Alternative. ENVIRONMENTAL PROTECTION Mitigation Project (LDWP), To ERP No. D–IBR–K39082–AZ Rating AGENCY Implement Restoration Measures in EC2, Wellton-Mohawk Title Transfer the Lower Duchesne River Area, Project, Transfer of the Facilities, [ER–FRL–6645–8] Strawberry Aqueduct and Collection Works, and Lands, Wellton-Mohawk System (SACS) on portions of the, Environmental Impact Statements; Division of the Gila Project, Wellton- Strawberry Reservoir, Ute Indian Notice of Availability Mohawk Irrigation and Drainage Tribe, NPDES and US Army COE District, Yuma County, AZ. Responsible Agency: Office of Federal Section 404 Permits, Duchesne, Utah, Summary: EPA expressed Activities, General Information (202) Uintah Counties, UT, Comment environmental concerns about potential 564–7167 or http://www.epa.gov/ Period Ends: January 16, 2004, hazardous waste associated with compliance/nepa/. Contact: Ralph G. Swanson (801) 379– underground and above ground storage Weekly receipt of Environmental Impact 1254. tanks, environmental justice, and Statements EIS No. 030533, Final EIS, AFS, ID, indirect air quality impacts due to Filed November 17, 2003 Through Clean Slate Ecosystem Management anticipated changes in existing land use. November 21, 2003 Project, Aquatic and Terrestrial

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00029 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66825

Restoration, Nez Perce National Gary S. Hartman (866) 530–0944. This considerations which indicate the Forest, Salmon River Ranger District, document is available on the Internet proposed settlement is inappropriate, Idaho County ID, Wait Period Ends: at: http://www.eh.doe.gov/nepa/ improper or inadequate. Copies of the December 29, 2003, Contact: Mike documents.html. proposed settlement are available from: Mcgee (208) 983–1950. EIS No. 030541, Draft EIS, DOE, KY, Ms. Paula V. Batchelor, U.S. EPA, EIS No. 030534, Draft EIS, COE, NC, Paducah, Kentucky, Site Depleted Region 4, Waste Management Division, Bogus Inlet Channel Erosion Response Uranium Hexafluoride Conversion 61 Forsyth Street, SW, Atlanta, Georgia Project, Relocation of the Main Ebb Facility, Construction and Operation, 30303, (404) 562–8887. Channel to Eliminate the Erosive McCraken County, KY, Comment Written comments may be submitted Impact to the Town of Emerald Isle, Period Ends: February 02, 2004, to Ms. Batchelor within 30 calendar Carteret and Onslow Counties, NC, Contact: Gary S. Hartman (866) 530– days of the date of the publication. Comment Period Ends: , 0944. This document is available on Dated: November 14, 2003. 2004, Contact: Mickey T. Sugg (910) the Internet at: http:// 251–4811. www.eh.doe.gov/nepa/documents/ Rosalind H. Brown, EIS No. 030535, Draft EIS, AFS, MT, html. Chief, Superfund Enforcement & Information Judith Restoration Project, Proposal to Management Branch, Waste Management Maintain and/or Restore Healthy Soil, Amended Notices Division. Water and Vegetation Conditions, EIS No. 030407, Draft EIS, EPA, CT, NY, [FR Doc. 03–29694 Filed 11–26–03; 8:45 am] Lewis and Clark National Forest, Central and Western Long Island BILLING CODE 6560–50–P Judith Ranger District, Judith Basin Sound Dredged Material Disposal County, MT, Comment Period Ends: Sites, Designation, CT and NY, January 12, 2004, Contact: Jennifer Comment Period Ends: December 15, ENVIRONMENTAL PROTECTION Johnsten (406) 791–7700. 2003, Contact: Ann Rodney (617) AGENCY EIS No. 030536, Final EIS, SFW, WA, 918–1538. Revision of FR Notice Daybreak Mine Expansion and Habitat Published on 9/12/2003: CEQ [FRL–7592–2] Enhancement Project, Habitat Comment Period Ending on 10/27/ Conservation Plan, and Issuance of a 2003 has been Extended to 12/15/ Lakewood Treating, Inc., Superfund Multiple Species Permit for Incidental 2003. Site, Newberry, SC; Notice of Proposed Take, Implementation, Clark County, Settlement and Removal Action WA, Wait Period Ends: December 29, Dated: November 24, 2003. 2003, Contact: Tim Romanski (360) Joseph C. Montgomery, AGENCY: Environmental Protection 753–5823. Director, NEPA Compliance Division, Office Agency. EIS No. 030537, Final EIS, BLM, AK, of Federal Activities. SUMMARY: The United States Northwest National Petroleum [FR Doc. 03–29690 Filed 11–26–03; 8:45 am] Environmental Protection Agency is Reserve-Alaska (NPR–A) Integrated BILLING CODE 6560–50–P proposing to enter into a proposed Plan, Multiple-Use Management of 8.8 settlement and a removal action with million Acres, Lands within the North the settling parties pursuant to Section Slope Borough, AK, Wait Period Ends: ENVIRONMENTAL PROTECTION 104, 106(a), 107, and 122 of the December 29, 2003, Contact: Curtis AGENCY Comprehensive Environmental Wilson (907) 271–5546. [FRL–7592–3] Response, Compensation, and Liability EIS No. 230538, Draft EIS, AFS, NB, Act (CERCLA), as amended, 42 U.S.C. Pine Ridge Geographic Area Illinois Central Railroad Company’s 9604, 9606(a), 9607 and 9622 Rangeland Allotment Management Johnston Yard Superfund Site, concerning the Lakewood Treating, Inc., Planning, To Permit Livestock Memphis, Tennessee Notice of Superfund Site in Newberry, Newberry Grazing on 34 Allotments, Nebraska Proposed Settlement and Remedial County, South Carolina. EPA will National Forest, Pine Ridge Ranger Investigation/Feasibility Study consider public comments on the District, Dawes and Sioux Counties, proposed settlement until December 29, AGENCY: Environmental Protection NB, Comment Period Ends: January 2003. EPA may withdraw from or Agency. 12, 2004, Contact: Jeffrey S. Abegglen modify the proposed settlement should (308) 432–4475. SUMMARY: The United States such comments disclose facts or EIS No. 030539, Draft EIS, DOE, OR, Environmental Protection Agency is considerations which indicate the COB Energy Facility, Proposes to proposing to enter into a proposed proposed settlement is inappropriate, Construct a 1,160-megawatt (MW) settlement and remedial investigation/ improper or inadequate. Copies of the Natural Gas-Fired and Combined- feasibility study (RI/FS) with the proposed settlement are available from: Cycle Electric Generating Plant, Right- settling parties pursuant to Sections Ms. Paula V. Batchelor, U.S. EPA, of-Way Permit across Federal Land 104, 122(a), and 122(d)(3) of the Region 4, Waste Management Division, under the Jurisdiction of BLM, Comprehensive Environmental 61 Forsyth Street, SW., Atlanta, Georgia Klamath Basin, Klamath County, OR, Response, Compensation, and Liability 30303, (404) 562–8887. Act (CERCLA), as amended, 42 U.S.C. Comment Period Ends: February 13, Written comments may be submitted 9604, 9622(a), and 9622(d)(3) 2004, Contact: Thomas C. McKinney to Ms. Batchelor within 30 calendar concerning the Illinois Central Railroad (503) 230–4749. This document is days of the date of the publication. available on the Internet at: http:// Company’s Johnston Yard Superfund www.bpa.gov. Site located in Memphis, Shelby Dated: November 14, 2003. EIS No. 030540, Draft EIS, DOE, OH, County, Tennessee. EPA will consider Rosalind H. Brown, Portsmouth, Ohio Site Depleted public comments on the proposed Chief, Superfund Enforcement & Information Uranium Hexafluoride Conversion settlement until December 29, 2003. Management Branch, Waste Management Facility, Construction and Operation, EPA may withdraw from or modify the Division. Pike County, OH, Comment Period proposed settlement should such [FR Doc. 03–29693 Filed 11–26–03; 8:45 am] Ends: February 02, 2004, Contact: comments disclose facts or BILLING CODE 6560–50–P

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00030 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66826 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

ENVIRONMENTAL PROTECTION Region 1, Office of Ecosystem Protection EXPORT-IMPORT BANK AGENCY (CPE), 1 Congress Street, Suite 1100, Notice of Open Special Meeting of the [FRL–7591–9] Boston, Massachusetts 02114–2023 and also sent via e-mail to Advisory Committee of the Export- Notice of Availability of Draft National [email protected]. No facsimiles Import Bank of the United States (Ex- Pollution Discharge Elimination (faxes) will be accepted. The draft Im Bank) System (NPDES) General Permit for permit is based on an administrative SUMMARY: The Advisory Committee was Discharges at Hydroelectric record available for public review at established by Pub. L. 98–181, Generating Facilities in the States of EPA-Region 1, Office of Ecosystem November 30, 1983, to advise the Massachusetts and New Hampshire Protection (CPE), 1 Congress Street, Export-Import Bank on its programs and and Indian Lands in the State of Suite 1100, Boston, Massachusetts to provide comments for inclusion in Massachusetts 02114–2023. Copies of information in the reports of the Export-Import Bank of the record are available upon request. A the United States to Congress. AGENCY: Environmental Protection Agency (EPA). reasonable fee may be charged for Time and Place: Thursday, December copying. 18, 2003, at 10 a.m. to 12:30 p.m. The ACTION: Notice of availability of Draft meeting will be held at Ex-Im Bank in NPDES General Permits MAG360000 FOR FURTHER INFORMATION CONTACT: the Main Conference Room 1143, 811 and NHG360000. Additional information concerning the Vermont Avenue, NW., Washington, DC draft permit may be obtained between SUMMARY: The Director of the Office of 20571. Ecosystem Protection, Environmental the hours of 8 a.m. and 4 p.m. Monday Agenda: Agenda items include Protection Agency-Region 1, is today through Friday excluding holidays from: briefing of the Advisory Committee providing notice of availability of the William Wandle, Office of Ecosystem members on their responsibilities and Draft National Pollutant Discharge Protection, Environmental Protection discussion of the Advisory Committee Elimination System (NPDES) general Agency, 1 Congress Street, Suite 1100 Theme—‘‘What fundamental changes in permit for specific discharges at (CPE), Boston, MA 02114—2023, products and approaches need to be Hydroelectric Generating Facilities to telephone: 617–918–1605, email: made to better serve middle market certain waters of the States of [email protected]. exporters?’’ Massachusetts and New Hampshire and Public Participation: The meeting will SUPPLEMENTARY INFORMATION: Indian Lands in the State of The draft be open to public participation, and the Massachusetts. This draft general permit general permit may be viewed over the last 10 minutes will be set aside for oral establishes Notice of Intent (NOI) Internet via the EPA-Region 1 web site questions or comments. Members of the requirements, effluent limitations, for dischargers in Massachusetts at public may also file written statement(s) standards, prohibitions, and best http://www.epa.gov/ne/npdes/ before or after the meeting. If any person management practices for classes of mass.html and for dischargers in New wishes auxiliary aids (such as a sign discharges at hydroelectric generating Hampshire at http://www.epa.gov/ne/ language interpreter) or other special facilities. npdes/newhampshire.html. The draft accommodations, please contact, prior Owners and/or operators of general permit includes the standard to December 11, 2003, Teri Stumpf, hydroelectric generating facilities with permit conditions in Part II, the Best Room 1203, 811 Vermont Avenue, NW., discharges, including those facilities Management Practices Plan in Part III, Washington, DC 20571, Voice: (202) currently authorized to discharge under and the fact sheet which sets forth 565–3542 or TDD (202) 565–3377. individual NPDES permits, will be principal facts and the significant FOR FURTHER INFORMATION CONTACT: Teri encouraged to submit an NOI to EPA- factual, legal, and policy questions Stumpf, Room 1203, 811 Vermont Ave., Region 1 to be covered by the general considered in the development of the NW., Washington, DC 20571, (202) 565– permit and will receive a written draft permit. To obtain a paper copy of 3502. notification from EPA of permit the documents, please contact William Peter Saba, coverage and authorization to discharge Wandle using the contact information General Counsel. under one of the general permits. The provided above. A reasonable fee may [FR Doc. 03–29663 Filed 11–26–03; 8:45 am] eligibility requirements are discussed in be charged for copying requests. detail in the fact sheet and in the general BILLING CODE 6690–01–M permit. This general permit does not When the general permit is issued, the cover new sources as defined under 40 notice of final issuance will be CFR 122.2. published in the Federal Register. The FEDERAL COMMUNICATIONS general permit shall be effective on the DATES: Comments must be received or COMMISSION postmarked by midnight on December date specified in the notice of final issuance of the general permit published Notice of Public Information 29, 2003. Interested persons may submit Collection(s) Being Reviewed by the comments on the draft general permit as in the Federal Register and it will expire five years from the effective date. Federal Communications Commission part of the administrative record to the for Extension Under Delegated EPA-Region 1 at the address given Dated: November 17, 2003. Authority below. Within the comment period, Ira W. Leighton, interested persons may also request in Acting Regional Administrator, Region 1. November 19, 2003. writing a public hearing pursuant to 40 SUMMARY: [FR Doc. 03–29691 Filed 11–26–03; 8:45 am] The Federal Communications CFR 124.12 concerning the draft general Commission, as part of its continuing permit. All public comments or requests BILLING CODE 6560–50–P effort to reduce paperwork burden for a public hearing must be submitted invites the general public and other to the address below. Federal agencies to take this ADDRESSES: Written comments may be opportunity to comment on the hand delivered or mailed to: EPA- following information collection(s), as

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00031 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66827

required by the Paperwork Reduction telecommunications carriers and cable Form No.: N/A. Act of 1995, Public Law 104–13. An system operators have Type of Review: Extension of a agency may not conduct or sponsor a nondiscriminatory access to utility currently approved collection. collection of information unless it poles, ducts, conduits, and rights-of-way Respondents: Business or other for displays a currently valid control on rates, terms and conditions that are profit. number. No person shall be subject to just and reasonable. The information Number of Respondents: 20 any penalty for failing to comply with collected under these rules will be used respondents; 100 responses. a collection of information subject to the by FCC to hear and resolve petitions for Estimated Time Per Response: 8 Paperwork Reduction Act (PRA) that stay and complaints as mandated by hours. does not display a valid control number. Section 224 of the Communications Act Frequency of Response: On occasion Comments are requested concerning (a) of 1934, as amended. Information filed reporting requirement. whether the proposed collection of is used to determine the merits of the Total Annual Burden: 800 hours. information is necessary for the proper petitions and complaints. Additionally, Annual Cost Burden: N/A. performance of the functions of the state certifications are used to make Needs and Uses: The Commission has Commission, including whether the public notice of the states’ authority to provided voluntary guidelines for filing information shall have practical utility; regulate rates, terms, and conditions for expanded local calling service requests. (b) the accuracy of the Commission’s pole attachments, and to determine the These guidelines will allow the burden estimate; (c) ways to enhance scope of the FCC’s jurisdiction. Commission to conduct smooth and the quality, utility, and clarity of the OMB Control No.: 3060–0961. continuous processing of these requests. information collected; and (d) ways to Title: 2000 Biennial Regulatory The collection of information will minimize the burden of the collection of Review—Comprehensive Review of the enable the Commission to determine if information on the respondents, Accounting Requirements and ARMIS there is a public need for expanded including the use of automated Reporting Requirements for Incumbent local calling service in each area subject collection techniques or other forms of Local Exchange Carriers; Phase 2 and to the request. information technology. Phase 3, CC Docket No. 00–199. OMB Control No.: 3060–0786. DATES: Persons wishing to comment on Form Nos. and Report Nos.: FCC Title: Petitions for LATA Association this information collection should Reports 43–01, 43–02, 43–03, 43–04, Changes by Independent Telephone submit comments January 27, 2004. If 43–05, 43–07, 43–08, FCC Forms 495A Companies. you anticipate that you will be and 495–B. Form No.: N/A. submitting comments, but find it Type of Review: Extension of a Type of Review: Extension of a difficult to do so within the period of currently approved collection. currently approved collection. Respondents: Business or other for- time allowed by this notice, you should Respondents: Business or other for profit entities. profit. advise the contact listed below as soon Number of Respondents: 1. as possible. Estimated Time Per Response: 1 hour. Number of Respondents: 20. ADDRESSES: Direct all Paperwork Frequency of Response: On occasion Estimated Time Per Response: 6 Reduction Act (PRA) comments to and annual reporting requirements and hours. Judith B. Herman, Federal recordkeeping requirement. Frequency of Response: On occasion Communications Commission, 445 12th Total Annual Burden: 1 hour. reporting requirement. Street, SW, Room 1–C804, Washington, Annual Cost Burden: N/A. Total Annual Burden: 120 hours. DC 20554 or via the Internet to Judith- Needs and Uses: The Commission is Annual Cost Burden: N/A. [email protected]. extending this information collection Needs and Uses: The Commission has provided voluntary guidelines for filing FOR FURTHER INFORMATION CONTACT: For (no change) for the three year OMB LATA association change requests. additional information or copies of the clearance. In 2001, the Commission These guidelines will allow the information collections contact Judith B. sought comment on streamlining our Commission to conduct smooth and Herman at 202–418–0214 or via the Part 32 chart of accounts, modified our continuous processing of these requests. Internet at [email protected]. affiliate transaction rules, and revised our expense limits rules. In addition, The collection of information will SUPPLEMENTARY INFORMATION: the NPRM sought comment on enable the Commission to determine if OMB Control No.: 3060–0392. there is a public need for changes in Title: 47 CFR Part 1, Subpart J, Pole streamlining the accounting and reporting requirements specifically for LATA association in each area subject to Attachment Complaint Procedures. the request. Form No.: N/A. mid-sized carriers by eliminating Type of Review: Extension of a mandatory CAM filing and CAM audits Federal Communications Commission. currently approved collection. for those carriers. The NPRM also Marlene H. Dortch, Respondents: Business or other for proposed raising the indexed revenue Secretary. threshold to $200 million. In addition, profit and state, local, or tribal [FR Doc. 03–29655 Filed 11–26–03; 8:45 am] with respect to ARMIS reporting government. BILLING CODE 6712–01–P Number of Respondents: 1,802. requirements, the NPRM sought Estimated Time Per Response: 5 comment on revising various ARMIS hours. reports. The proposals sought to eliminate or substantially simplify the FEDERAL DEPOSIT INSURANCE Frequency of Response: On occasion CORPORATION reporting requirement and third party reporting requirements for both large disclosure requirement. incumbent LECs and mid-sized Notice of Agency Meeting Total Annual Burden: 2,693 hours. incumbent LECs. Annual Cost Burden: $300,000. OMB Control No.: 3060–0782. Pursuant to the provisions of the Needs and Uses: The rules and Title: Petitions for Limited ‘‘Government in the Sunshine Act’’ (5 regulations contained in 47 CFR part 1, Modification of LATA Boundaries to U.S.C. 552b), notice is hereby given that subpart J, provide complaint and Provide Expanded Local Calling Service the Federal Deposit Insurance enforcement procedures to ensure that (ELCS) at Various Locations. Corporation’s Board of Directors will

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00032 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66828 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

meet in open session at 10 a.m. on Those attendees needing such assistance DATE AND TIME: Thursday, , Tuesday, December 2, 2003, to consider should call (202) 416–2089 (Voice); 2003 at 10 a.m. the following matters: (202) 416–2007 (TTY), to make PLACE: 999 E Street, NW., Washington, Summary Agenda: No substantive necessary arrangements. DC (Ninth Floor). discussion of the following items is Requests for further information STATUS: This meeting will be open to the anticipated. These matters will be concerning the meeting may be directed public. resolved with a single vote unless a to Mr. Robert E. Feldman, Executive member of the Board of Directors Secretary of the Corporation, at (202) Items To Be Discussed. requests that an item be moved to the 898–3742. Correction and Approval of Minutes. discussion agenda. Dated: November 25, 2003. Draft Advisory Opinion 2203–31: Disposition of minutes of a previous Federal Deposit Insurance Corporation. Senator Mark Dayton by counsel, Marc Board of Directors’ meeting. E. Elias and Brian T. Svoboda. Robert E. Feldman, Summary reports, status reports, and Routine Administrative Matters. reports of actions taken pursuant to Executive Secretary. FOR FURTHER INFORMATION CONTACT: Mr. authority delegated by the Board of [FR Doc. E3–00414 Filed 11–25–03; 4:17 pm] Ron Harris, Press Officer, Telephone: Directors. BILLING CODE 6714–01–P Memorandum and resolution re: (202) 694–1220. Beneficial Ownership Filings Mary W. Dove, (Securities Exchange Act)—Notice of Secretary of the Commission. a New Privacy Act System of Records. FEDERAL ELECTION COMMISSION [FR Doc. 03–29804 Filed 11–25–03; 11:13 Discussion Agenda: am] Sunshine Act Notices Memorandum and resolution re: BILLING CODE 6715–01–M Advanced Notice of Proposed DATE AND TIME: Tuesday, December 2, Rulemaking—12 CFR Part 332, Short- 2003 at 10 a.m. Form Financial Institution Privacy FEDERAL MARITIME COMMISSION Notices. PLACE: 999 E Street, NW., Washington, DC. Memorandum and resolution re: Notice Ocean Transportation Intermediary and Request for Public Comment STATUS: This meeting will be closed to License Reissuances Pursuant to the Economic Growth and the public. Regulatory Paperwork Reduction Act Notice is hereby given that the Items To Be Discussed of 1996 (EGRPRA)—Phase II. following Ocean Transportation Memorandum and resolution re: Compliance matters pursuant to 2 Intermediary licenses have been Proposed 2004 Corporate Operating U.S.C. 437g. reissued by the Federal Maritime Budget. Audits conducted pursuant to 2 Commission pursuant to section 19 of The meeting will be held in the Board U.S.C. 437g, 438(b), and Title 26, U.S.C. the Shipping Act of 1984, as amended Room on the sixth floor of the FDIC Matters concerning participation in by the Ocean Shipping Reform Act of Building located at 550—17th Street, civil actions or proceedings or 1998 (46 U.S.C. app. 1718) and the NW., Washington, DC. arbitration. regulations of the Commission The FDIC will provide attendees with Internal personnel rules and pertaining to the licensing of Ocean auxiliary aids (e.g., sign language procedures or matters affecting a Transportation Intermediaries, 46 CFR interpretation) required for this meeting. particular employee. 515.

License No. Name/Address Date reissued

14617N ...... Asiana Transport Inc., 182–11 150th Road, 2nd Floor, Jamaica, NY 11413 ...... October 9, 2003. 12757N ...... Ocean Conco Line, Inc., 39 Broadway, Suite 750, New York, NY 10004 ...... , 2003. 12190N ...... Reliable Overseas Shipping & Trading, Inc., 239–241 Kingston Avenue, Brooklyn, NY 11213 ...... September 5, 2003. 13266N ...... Trans—Aero—Mar, Inc., 1203 NW 93rd Ct., Miami, FL 33172 ...... September 17, 2003. 12895N ...... United Trans-Trade, Inc., 646 Highway 18, Plaza Hill, Bldg. A, Suite 204, East Brunswick, NJ August 23, 2001. 08816.

Sandra L. Kusumoto, Freight Forwarder—Ocean Rosemeade, CA 91770, George C. Director, Bureau of Consumer Complaints Transportation Intermediary pursuant to Cheng, Sole Proprietor and Licensing. section 19 of the Shipping Act of 1984 Seabright Shipping Inc., 1525 [FR Doc. 03–29612 Filed 11–26–03; 8:45 am] as amended (46 U.S.C. app. 1718 and 46 Seabright Avenue, Long Beach, CA BILLING CODE 6730–01–P CFR 515). 90803, Officer: Robert Rong Tang Persons knowing of any reason why Wang, President (Qualifying the following applicants should not Individual) FEDERAL MARITIME COMMISSION receive a license are requested to Non-Vessel Operating Common Carrier contact the Office of Transportation and Ocean Freight Forwarder Ocean Transportation Intermediary Intermediaries, Federal Maritime License Applicants Transportation Intermediary Commission, Washington, DC 20573. Applicants: Notice is hereby given that the Non-Vessel Operating Common Carrier Codotrans, Inc., 857 Nandina Drive, following applicants have filed with the Ocean Transportation Intermediary Weston, FL 33327, Officers: Jaime Federal Maritime Commission an Applicants: Grullon, President (Qualifying application for license as a Non-Vessel G.C. International Forwarding Individual), Mayra Noboa, Director Operating Common Carrier and Ocean Company, 8518 Turpin Street, AAC Perishables Logistics, Inc., dba A

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00033 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66829

America Container Lines, 8202 NW Date Revoked: October 9, 2003. Address: 39 Broadway, Suite 750, 70th Street, Miami, FL 33166, Reason: Failed to maintain a valid New York, NY 10004. Officers: Jairo Rivas, Manager/ bond. Date Revoked: October 8 2003. Secretary (Qualifying Individual), License Number: 16363N. Reason: Failed to maintain a valid Carlos del Corral, President Name: Capitol Transportation, Inc. bond. Carico USA Corporation, 8378 NW Address: 2000 Avenue, J.F. Kennedy, License Number: 18364N. 68th Street, Miami, FL 33166, P.O. Box 363008, San Juan, PR 00936. Name: Polo Logistics, Inc. Officers: Raul Amprimo, President Date Revoked: , 2003. Address: 267 5th Avenue, Suite B–1, (Qualifying Individual), Rocio Reason: Failed to maintain a valid Amprimo, Vice President New York, NY 10016. bond. Date Revoked: October 30, 2003. Ocean Freight Forwarder—Ocean License Number: 17953N. Reason: Failed to maintain a valid Transportation Intermedidary Name: Caribbean Consolidator bond. Applicants: Shipping Services, Inc. License Number: 14125N. Bruzzone Shipping Miami, LLC, Address: 1521 NW 82nd Avenue, Name: Transtainer Corp. 11421 NW 39th Street, Miami, FL Miami, FL 33126 33178, Officers: Victor Bruzzone, Date Revoked: November 3, 2003. Address: 8100 NW 29th Street, Suite Managing Member (Qualifying Reason: Failed to maintain a valid 2A, Miami, FL 33122. Individual) Fred Bruzzone, Member bond. Date Revoked: November 6, 2003. Reason: Failed to maintain a valid Transportes Zuleta Inc., 6309 New License Number: 17656NF. bond. Hampshire Avenue, Takoma Park, Name: Coltrans (USA), Inc. MD 20912, Officers: Jose Alfredo Address: 10925 NW 27th Street, Suite Sandra L. Kusumoto, Munoz, President (Qualifying 102, Miami, FL 33172. Individual), Delmy Zuleta, Vice Director, Bureau of Consumer Complaints Date Revoked: October 31, 2003. and Licensing. President Reason: Failed to maintain valid FMD International Business Inc., dba [FR Doc. 03–29611 Filed 11–26–03; 8:45 am] bonds. Triton Cargo USA, 576 NW 87th BILLING CODE 6730–01–P Terrace, Coral Springs, FL 33071, License Number: 16859NF. Officer: Felipe Madrigal, General Name: Global Cargo Jamaica Manager (Qualifying Individual) Shipping, Inc. Address: 6151 NW 72nd Avenue, DEPARTMENT OF HEALTH AND Bryant L. VanBrakle, Miami, FL 33166. HUMAN SERVICES Secretary. Date Revoked: , 2003. [FR Doc. 03–29613 Filed 11–26–03; 8:45 am] Reason: Failed to maintain valid Centers for Disease Control and BILLING CODE 6730–01–P bonds. Prevention License Number: 2638F. Cooperative Agreement for Research Name: Intercorp Forwarders, Ltd. FEDERAL MARITIME COMMISSION on the Association Between Exposure Address: 3534 84th Street, Unit B–7, to Media Violence and Youth Violence Jackson Heights, NY 11372. Ocean Transportation Intermediary Date Revoked: October 30, 2003. License Revocations Announcement Type: New. Reason: Failed to maintain a valid Funding Opportunity Number: 04060. The Federal Maritime Commission bond. Catalog of Federal Domestic hereby gives notice that the following License Number: 17232N. Assistance Number: 93.136. Ocean Transportation Intermediary Name: International Cargo Key Dates: licenses have been revoked pursuant to Consolidators, Corp. Letter of Intent Deadline: December section 19 of the Shipping Act of 1984 Address: 10049 NW 89th Avenue, Bay 29, 2003. (46 U.S.C. app. 1718) and the #3, Medley, FL 33178. Application Deadline: February 17, regulations of the Commission Date Revoked: October 15, 2003. 2004. pertaining to the licensing of Ocean Reason: Failed to maintain a valid Transportation Intermediaries, effective bond. I. Funding Opportunity Description on the corresponding date shown below: License Number: 3110F. Authority: This program is authorized License Number : 17893N. Name: International Freight under section 301 (a) [42 U.S.C. 241(a)] of the Name: All World Logistics, Inc. dba Transport, Inc. Public Health Service Act and section 391 Internet Shipping Line. Address: 88 South Avenue, Fanwood, (a)[42 U.S.C. 280b (a)] of the Public Service Address: 969 Newark Turnpike, NJ 07023. Health Act, as amended. Kearny, NJ 07032. Date Revoked: November 6, 2003. Date Revoked: November 14, 2003. Purpose: The purpose of the program Reason: Failed to maintain a valid is to conduct methodologically sound Reason: Failed to maintain a valid bond. bond. research on how media violence affects License Number: 14623N. License Number: 3945F. youth violent behavior. This program Name: Alumar, Incorporated. Name: NRS International Transport addresses the ‘‘Healthy People 2010’’ Address: 4809 N. Armenia Avenue, Limited. focus area of Injury and Violence Suite 105, Tampa, FL 33603. Address: Roycraft House, 15 Linton Prevention. Date Revoked: , 2003. Road, Barking, Essex IG11 8JB, United Measurable outcomes of the program Reason: Failed to maintain a valid Kingdom. will be in alignment with the following bond. Date Revoked: October 8, 2003. performance goal for the National License Number: 14617N. Reason: Failed to maintain a valid Center for Injury Prevention and Control Name: Asiana Transport Inc. bond. (NCIPC): Conduct a targeted program of Address: 182–11 150th Road, 2nd License Number: 12757N. research to reduce injury-related death Floor, Jamaica, NY 11413. Name: Ocean Conco Line, Inc. and disability.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00034 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66830 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Research Objectives violence, including victimization and Budget Period Length: 12 months. There has been a longstanding perpetration resulting in injury; and (c) Project Period Length: Three years. concern about the consequences of describing the individual and Throughout the project period, CDC’s youths’ exposure to violence in the contextual factors that influence the commitment to continuation awards media, with particular concern about association between exposure to violent will be conditioned on the availability the effects of such exposure on violent media and risk for violence. of funds, evidence of satisfactory progress by the recipient (as behavior. Recent studies have Activities documented the profusion of different documented in required reports), and Awardee activities for this program types of media in United States the determination that continued are as follows: homes 1 ndash;3 and the widespread funding is in the best interest of the 1. In collaboration with CDC finalize presence of violence in these media Federal Government. the research design and methodology, outlets.4,5 The emergence and data collection measures, analyses, and III. Eligibility Information proliferation of new media (e.g., video dissemination of the study results 1. Eligible applicants: Applications games, music videos, Internet sites, and through publication and presentations. may be submitted by public and private DVD) have increased opportunities for 2. In collaboration with CDC finalize nonprofit organizations and by children and youth to be exposed to a research protocol for Institutional governments and their agencies, such violence. Despite the fact that there has Review Board (IRB) review by all as: been extensive research on this subject, cooperating institutions participating in • at least three key gaps remain in our Public nonprofit organizations the research project. • understanding of the relationship Private nonprofit organizations 3. Conduct one reverse site visit to • between youth exposure to media Small, minority, women-owned meet with CDC staff in Atlanta on an businesses violence and violent behavior. First, annual basis. • more information is needed about the Universities 4. Complete all required reports as • Colleges effects of different types of new media specified under ‘‘Reporting • and their content on violent behavior. Research institutions Requirements’’ of this program • Hospitals Second, while substantial research has announcement. • described associations between Community-based organizations In a cooperative agreement, CDC staff • Faith-based organizations exposure to violent media on attitudes is substantially involved in the program • and measures of aggression, less is Federally recognized Indian tribal activities, above and beyond routine governments known about the extent to which grant monitoring. • exposure to violent media is associated Indian tribes CDC activities for this program are as • Indian tribal organizations with risk for more serious forms of follows: • violence, including victimization and State and local governments or their 1. Serve as co-investigator and bona fide agents (this includes the perpetration resulting in injury. Third, a provide scientific oversight. CDC will relatively small subset of youth may be District of Columbia, the actively collaborate with project staff on Commonwealth of Puerto Rico, the particularly susceptible to the effects of decision-analyses, interpretation of exposure to violent media. Additional Virgin Islands, the Commonwealth of findings, and dissemination of the study Mariana Islands, American Samoa, research is needed to understand the results through involvement in the individual and contextual factors that Guam, the Federated States of production of publications and Micronesia, the Republic of the influence the association between presentations. exposure to violent media and risk for Marshall Islands, and the Republic of 2. Assist in finalizing the research Palau) violence. protocol for IRB review by all • The purpose of the current program Political subdivisions of States (in cooperating institutions participating in consultation with States) announcement is to conduct the research project. The CDC IRB will methodologically sound research on review and approve the protocol A Bona Fide Agent is an agency/ how media influences youth initially and on at least an annual basis organization identified by the state as susceptibility to violence. Project until the research project is finished. eligible to submit an application under proposals should be designed to: (1) 3. Facilitate regular communication the state eligibility in lieu of a state Examine the association between between CDC and the grantee to application. If you are applying as a exposure to violent media and serious include, but not limited to site visits, bona fide agent of a state or local violent behavior, including conference calls, meetings, etc. government, you must provide a letter victimization and perpetration resulting from the state as documentation of your in injury; (2) include an assessment of II. Award Information status. Place this documentation behind the specific aspects of media (e.g., type Type of Award: Cooperative the first page of your application form. and content) that are likely to contribute Agreement. CDC involvement in this 2. Cost Sharing or Matching: Matching to risk for violence; and (3) identify program is listed in the Activities funds are not required for this program. individual and contextual factors that Section above. 3. Other Eligibility Requirements: mediate or moderate the association Fiscal Year Funds: 2004. Applications that are incomplete or between exposure to violent media and Approximate Total Funding: non-responsive to the below serious violent behavior, with particular $600,000. requirements will be returned to the attention to the potential moderating Approximate Number of Awards: applicant without further consideration. effects of gender and prior exposure to Two. You will be notified that your real-life violence. Approximate Average Award: application did not meet submission $300,000. requirements. Funding Priority Floor of Award Range: None. The following are applicant Priority will be given to research Ceiling of Award Range: $300,000. requirements: proposals that include a focus on (a) Anticipated Award Date: , 1. A principal investigator who has new forms of media; (b) serious forms of 2004. conducted research, published the

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00035 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66831

findings in peer-reviewed journals, and of interest in this program, and to allow plan should include an outline of a has specific authority and responsibility CDC to plan the application review. three-year plan with timeline. to carry out the proposed project. Your LOI must be written in the 3. Program Participants. Describe the 2. Demonstrated experience on the following format: study population for the proposed research and how participants will be applicant’s project team in conducting, • Maximum number of pages: Two selected (i.e., sampling strategy). In evaluating, and publishing violence • Font size: 12-point unreduced addition, the research plan should prevention research in peer-reviewed • Paper size: 8.5 by 11 inches journals. • Single Spaced provide evidence that the recipient (or 3. Effective and well-defined working • Page margin size: One inch a collaborating partner) has access to the relationships within the performing • Printed only on one side of page study population, and that the organization and with outside entities, • Written in English, avoid jargon participation by the study population which will ensure implementation of Your LOI must contain the following will be adequate to test hypotheses. 4. Methods. Describe the proposed the proposed activities. information: study design; methods, and analysis 4. The overall match between the • Descriptive title of the proposed plan to test the proposed study applicant’s proposed research objectives research and the program priorities as described • hypotheses. Name, address, E-mail address, and 5. Project Management. Provide under the heading, ‘‘Funding Priority’’. telephone number of the Principal 5. The requested funding amount evidence of the expertise, capacity, and Investigator existing staff necessary to successfully should not be greater than the ceiling of • Names of other key personnel the award amount. • conduct the research. Each existing or Participating institutions proposed position for the project should 6. Principal investigators (PI’s) are • Number and title of this Program be described by job title, function, encouraged to submit only one proposal Announcement (PA) in response to this program general duties, level of effort and Application: Follow the PHS 398 announcement. With few exceptions allocation of time. Management application instructions for content and (e.g., research issues needing immediate operation principles, structure, and formatting of your application. See all public health attention), only one organization should also be noted. attachments of this announcement as it application per PI will be funded under 6. Collaborative Efforts. List and is posted on the CDC Web site for this announcement. describe the current and proposed guidance on how to complete Form 398 collaborations with government, health, Note: Title 2 of the United States Code for this Program Announcement. The or youth agencies, community- or faith- section 1611 states that an organization Program Announcement Title and based organizations, minority described in section 501(c)(4) of the Internal number must appear in the application. Revenue Code that engages in lobbying organizations, and other researchers. activities is not eligible to receive Federal For further assistance with the PHS 398 Include letters of support and funds constituting an award, grant, or loan. application form, contact GrantsInfo, memoranda of understanding that Telephone (301) 435–0714, email: specify the nature of past, present, and IV. Application and Submission [email protected]. proposed collaborations, and the Information You must include a research plan products/services/activities that will be with your application. The research provided by and to the applicant. 1. Address to Request Application plan should be no more than 25 pages 7. Data Sharing and release: Describe Package (8.5″ x 11″ in size), single-spaced, plans for the sharing and release of data To apply for this funding opportunity, printed on one side only, with one-inch (See AR–25 for additional information). use application Form PHS 398 (OMB margins on all sides, and unreduced 12- 8. Project Budget. Provide a detailed Number 0925–0001 rev. 5/2001). Forms point font. budget for each activity undertaken, and instructions are available in an Your application will be evaluated on with accompanying justification of all interactive format on the CDC Web site, the criteria listed under Section V. operating expenses that is consistent at the following Internet address: http:/ Application Review Information, so it is with the stated objectives and planned /www.cdc.gov/od/pgo/forminfo.htm. important to follow them, as well as the activities of the project. This Forms and instructions are also Research Objectives and the announcement does not use the available in an interactive format on the Administrative and National Policy modular budget format. The budget National Institutes of Health (NIH) web Requirements (AR’s), in laying out your should include at least one trip per year site at the following Internet address: research plan. Your research plan to CDC for program related meetings. http://grants.nih.gov/grants/funding/ should address activities to be You are required to have a Dun and phs398/phs398.html. If you do not have conducted over the entire project Bradstreet Data Universal Numbering access to the Internet, or if you have period. System (DUNS) number to apply for a difficulty accessing forms on-line, you The research plan should consist of grant or cooperative agreement from the may contact the CDC Procurement and the following information: Federal government. Your DUNS Grants Office Technical Information 1. Abstract. Provide a one page brief number must be entered in item 11 of Management Section (PGO–TIM) staff at description of proposed research the face page of the PHS 398 application 770–488–2700. Application forms can activities and project outcomes. It is form. The DUNS number is a nine-digit be mailed to you. important to include an abstract that identification number, which uniquely reflects the project’s focus, because the identifies business entities. Obtaining a 2. Content and Form of Application abstract will be used to help determine DUNS number is easy and there is no Submission Letter of Intent (LOI) the responsiveness of the application. charge. To obtain a DUNS number, CDC requests that you send a LOI if 2. Goals and Objectives. Describe the access http:// you intend to apply for this program. goals and objectives the proposed www.dunandbradstreet.com or call 1– Although the LOI is not required, not research is designed to achieve in the 866–705–5711. For more information, binding, and does not enter into the short and long term. Specific research see the CDC Web site at: http:// review of your subsequent application, questions and hypotheses should also www.cdc.gov/od/pgo/funding/ the LOI will be used to gauge the level be included. In addition, the research pubcommt.htm.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00036 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66832 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

3. Submission Dates and Times 770–488–1662. Telephone: 770–488– Innovation: Does the project employ LOI Deadline Date: December 29, 4037. Email: [email protected]. novel concepts, approaches or methods? 2003. Application Submission Address: Are the aims original and innovative? Application Deadline Date: February Submit the signed original and five Does the project challenge existing 17, 2004. copies of your application by mail or paradigms or develop new Explanation of Deadlines: express delivery to: Technical methodologies or technologies? Investigator: Is the investigator Applications must be received in the Information Management—PA #04060, appropriately trained and well suited to CDC Procurement and Grants Office by Procurement and Grants Office, Centers carry out this work? Is the work 4 p.m. Eastern Time on the deadline for Disease Control and Prevention, proposed appropriate to the experience date. If you send your application by the 2920 Brandywine Road, Atlanta, GA 30341. level of the principal investigator and United States Postal Service or other researchers (if any)? commercial delivery services, you must Applications may not be submitted electronically at this time. Environment: Does the scientific ensure that the carrier will be able to environment in which the work will be guarantee delivery of the application by V. Application Review Information done contribute to the probability of the closing date and time. If an success? Does the proposed research application is received after closing due 1. Criteria: You are required to provide measures of effectiveness that take advantage of unique features of the to (1) carrier error, when the carrier scientific environment or employ useful accepted the package with a guarantee will demonstrate the accomplishment of the various identified objectives of the collaborative arrangements? Is there for delivery by the closing date and evidence of institutional support? time, or (2) significant weather delays or cooperative agreement. Measures of effectiveness must relate to the Additional Review Criteria: natural disasters, CDC will upon receipt Protection of Human Subjects from performance goals stated in the of proper documentation, consider the Research Risks: Does the application ‘‘Purpose’’ section of this application as having been received by adequately address the requirements of announcement. Measures must be the deadline. Title 45 CFR Part 46 for the protection objective and quantitative, and must This announcement is the definitive of human subjects? This will not be measure the intended outcome. These guide on application submission scored, however, an application can be measures of effectiveness must be address and deadline. It supersedes disapproved if the research risks are submitted with the application and will information provided in the application sufficiently serious and protection be an element of evaluation. instructions. If your application does against risks is so inadequate as to make The goals of CDC-supported research not meet the deadline above, it will not the entire application unacceptable. be eligible for review, and will be are to advance the understanding of Inclusion of Women and Minorities in discarded. You will be notified that you biological systems, improve the control Research: Does the application did not meet the submission and prevention of disease, and enhance adequately address the CDC Policy requirements. health. In the written comments, requirements regarding the inclusion of CDC will not notify you upon receipt reviewers will be asked to evaluate the women, ethnic, and racial groups in the of your application. If you have a application in order to judge the proposed research? This includes: (1) question about the receipt of your likelihood that the proposed research The proposed plan for the inclusion of application, first contact your courier. If will have a substantial impact on the both sexes and racial and ethnic you still have any questions, contact the pursuit of these goals. The scientific minority populations for appropriate PGO–TIM staff at: 770–488–2700. Before review group will address and consider representation; (2) The proposed calling, please wait two to three days each of the following criteria in justification when representation is after the application deadline. This will assigning the application’s overall score, limited or absent; (3) A statement as to allow time for applications to be weighting them as appropriate for each whether the design of the study is processed and logged. application. adequate to measure differences when 4. Intergovernmental Review: The application does not need to be warranted; and (4) A statement as to Executive Order 12372 does not apply strong in all categories to be judged whether the plans for recruitment and to this program. likely to have major scientific impact outreach for study participants include 5. Funding Restrictions: Restrictions, and thus serve a high priority score. For the process of establishing partnerships which must be taken into account while example, an investigator may propose to with community(ies) and recognition of writing your budget, are as follows: carry out important work that by its mutual benefits. None nature is not innovative, but is essential Inclusion of Children as Participants If you are requesting indirect costs in to move a field forward. in Research Involving Human Subjects: your budget, you must include a copy The criteria are as follows: The NIH maintains a policy that of your indirect cost rate agreement. If Significance: Does this study address children (i.e., individuals under the age your indirect cost rate is a provisional an important problem? If the aims of the of 21) must be included in all human rate, the agreement must be less than 12 application are achieved, how will subjects research, conducted or months of age. scientific knowledge be advanced? What supported by the NIH, unless there are Awards will not allow reimbursement will be the effect of these studies on the scientific and ethical reasons not to of pre-award costs. concepts or methods that drive this include them. This policy applies to all field? initial (Type 1) applications submitted 6. Other Submission Requirements Approach: Are the conceptual for receipt dates after October 1, 1998. LOI Submission Address: Submit your framework, design, methods, and All investigators proposing research LOI by express mail, delivery service, analyses adequately developed, involving human subjects should read fax, or E-mail to: Robin Forbes, National scientifically rigorous, well-integrated, the ‘‘NIH Policy and Guidelines’’ on the Center for Injury Prevention and and appropriate to the aims of the inclusion of children as participants in Control, Centers for Disease Control and project? Does the applicant research involving human subjects that Prevention, 4770 Buford Hwy, NE., acknowledge potential problem areas is available at: http://grants.nih.gov/ Mailstop K–62, Atlanta, GA 30341, Fax: and consider alternative tactics? grants/funding/children/children.htm.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00037 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66833

Budget: The reasonableness of the and their recommendations will be The following additional proposed budget and the requested carried to the entire ACIPC for voting by requirements apply to this project: period of support in relation to the the ACIPC members in closed session. If AR–1 Human Subjects Requirements proposed research. any further review is needed by the AR–2 Requirements for Inclusion of 2. Review and Selection Process: ACIPC, regarding the recommendations Women and racial and Ethnic Applications will be reviewed for of the SPRS, the factors considered will Minorities in Research completeness by the Procurement and be the same as those considered by the AR–9 Paperwork Reduction Act Grants Office (PGO) and for SPRS. Requirements Projects that involve responsiveness by the NCIPC. The committee’s responsibility is to the collection of information from Incomplete applications and develop funding recommendations for ten or more persons and that are applications that are non-responsive the NCIPC Director based on the results funded by cooperative agreements will not advance through the review of the primary review, the relevance and will be subject to review and process. Applicants will be notified that balance of proposed research relative to approval by the Office of their application did not meet the NCIPC programs and priorities, and Management and Budget (OMB). submission requirements. to assure that unwarranted duplication AR–10 Smoke-Free Workplace Applications that are complete and of federally-funded research does not Requirements responsive to the PA will be subjected occur. The secondary review committee AR–11 Healthy People 2010 to a preliminary evaluation (streamline has the latitude to recommend to the AR–12 Lobbying Restrictions review) by a peer review committee, the NCIPC Director, to reach over better- AR–13 Prohibition on Use of CDC Initial Review Group (IRG) convened by ranked proposals in order to assure Funds for Certain Gun Control NCIPC, to determine if the application maximal impact and balance of Activities is of sufficient technical and scientific proposed research. The factors to be AR–21 Small, Minority, Women- merit to warrant further review by the considered will include: Owned Businesses IRG. CDC will withdraw from further AR–22 Research Integrity a. The results of the primary review consideration applications judged to be AR–23 States and Faith-Based including the application’s priority noncompetitive and promptly notify the Organizations score as the primary factor in the principal investigator or program AR–24 Health Insurance Portability selection process. director and the official signing for the and Accountability Requirements applicant organization. Those b. The relevance and balance of AR–25 Release and Sharing of Data applications judged to be competitive proposed research relative to the NCIPC Starting with the December 1, 2003 will be further evaluated by a dual programs and priorities. receipt date, all NCIPC funded review process. c. The significance of the proposed investigators seeking more than 1. The primary review will be a peer activities in relation to the priorities and $250,000 in total costs in a single year review conducted by the IRG. All objectives stated in ‘‘Healthy People are expected to include a plan applications will be reviewed for 2010,’’ the Institute of Medicine report, describing how the final research data scientific merit in accordance with the ‘‘Reducing the Burden of Injury,’’ and will be shared/released or explain why review criteria listed above. the ‘‘CDC Injury Research Agenda.’’ data sharing is not possible. Details on Applications will be assigned a priority All awards will be determined by the data sharing/release, including the score based on the National Institutes of Director of the NCIPC based on priority timeliness and name of the project data Health (NIH) scoring system of 100–500 scores assigned to applications by the steward, should be included in a brief points. IRG, recommendations by the secondary paragraph immediately following the 2. The secondary review will be review committee, e.g., NCIPC’s Research Plan Section of the PHS 398 conducted by the Science and Program Advisory Committee for Injury form. References to data sharing/release Review Subcommittee (SPRS) of Prevention and Control (ACIPC), may also be appropriate in other NCIPC’s Advisory Committee for Injury consultation with NCIPC senior staff, sections of the application (e.g. Prevention and Control (ACIPC). The and the availability of funds. background and significance, human ACIPC Federal agency experts will be VI. Award Administration Information subjects requirements, etc.) The content invited to attend the secondary review, of the data sharing/release plan will and will receive modified briefing books 1. Award Notices: Successful vary, depending on the data being (i.e., abstracts, strengths and weaknesses applicants will receive a Notice of Grant collected and how the investigator is from summary statements, and project Award (NGA) from the CDC planning to share the data. The data officer’s briefing materials). ACIPC Procurement and Grants Office. The sharing/release plan will not count Federal agency experts will be NGA shall be the only binding, towards the application page limit and encouraged to participate in authorizing document between the will not factor into the determination deliberations when applications address recipient and CDC. The NGA will be scientific merit or priority scores. overlapping areas of research interest, so signed by an authorized Grants Investigators should seek guidance from that unwarranted duplication in Management Officer, and mailed to the their institutions, on issues related to federally-funded research can be recipient fiscal officer identified in the institutional policies, local IRB rules, as avoided and special subject area application. well as local, state and Federal laws and expertise can be shared. The NCIPC 2. Administrative and National Policy regulations, including the Privacy Rule. Division Associate Directors for Science Requirements: Further detail on the requirements for (ADS) or their designees will attend the addressing data sharing in applications 45 CFR Part 74 and 92 secondary review in a similar capacity for NCIPC funding may be obtained by as the ACIPC Federal agency experts to For more information on the Code of contacting NCIPC program staff or assure that research priorities of the Federal Regulations, see the National visiting the NCIPC Internet Web site: at announcement are understood and to Archives and Records Administration at http://www.cdc.gov/ncipc/osp/ provide background regarding current the following Internet address: http:// sharing_policy.htm. research activities. Only SPRS members www.access.gpo.gov/nara/cfr/cfr-table- Additional information on these will vote on funding recommendations, search.html. requirements can be found on the CDC

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00038 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66834 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Web site at the following Internet Research Agenda. Atlanta, GA: Centers of residential fire-related injuries and address: http://www.cdc.gov/od/pgo/ for Disease Control and Prevention, fatalities in high-risk communities. funding/ARs.htm. 2002. This program addresses the ‘‘Healthy 3. Reporting: You must provide the 2. Roberts DF, Foehr UG, Rideout VJ, People 2010,’’ focus area of Injury and CDC with original and two copies of the Vrodie M. Kids & media @ the new Violence Prevention. following reports: millennium. Menlo Park, CA: Henry J. Measurable outcomes of the program 1. Interim progress report (PHS 2590, Kaiser Family Foundation, 1999. will be in alignment with one or more OMB Number 0925–0001, rev. 5/2001) 3. Woodward EH. Media in the home of the following performance goals for no less than 90 days before the end of 2000: The fourth annual survey of the National Center for Injury the budget period. The progress report parents and children (Survey Series No. Prevention and Control (NCIPC): will serve as your non-competing 7). Philadelphia, PA: The Annenberg 1. Increase the capacity of injury continuation application, and must Public Policy Center of the University of prevention and control programs to contain the following elements: Pennsylvania, 1998. address the prevention of injuries and a. Current Budget Period Activities 4. Wilson BJ, Kunkel D, D, Potter violence. Objectives J, Donnerstein E, Smith SL, Blumenthal 2. Monitor and detect fatal and non- b. Current Budget Period Financial E, Gray T. Violence in television fatal injuries. Progress. programming overall: University of 3. Conduct a targeted program of c. New Budget Period Program California, Santa Barbara study. In research to reduce injury-related death Proposed Activity Objectives. Seawall M. (Ed.), National television and disability. d. Detailed Line-Item Budget and violence study (Vol. 1, pp. 3–184). Research Objectives Justification. Thousand Oaks, CA: Sage Publications, e. Additional Requested Information. 1997. The objective of this cooperative 2. Financial status report, no more Wilson BJ, Kunkel D, Linz D, Potter J, agreement is to rigorously evaluate than 90 days after the end of the budget Donnerstein E, Smith SL, Blumenthal E, strategies to reduce the number of period. Berry M. Violence in television residential fire-related injuries and 3. Final financial status and programming overall: University of fatalities in high-risk communities. performance reports, no more than 90 California, Santa Barbara study. In Smoke alarms have proven effective in days after the end of the project period. Seawall M. (Ed.), National television reducing the fire death and injury toll. VII. Agency Contacts violence study (Vol. 2, pp. 3–204). Research shows that functioning smoke alarms are more likely to be present in For general questions about this Thousand Oaks, CA: Sage Publications, a home when a fire safety program announcement, contact: Technical 1998. provides and installs them, rather than Information Management Section, Dated: November 20, 2003. simply providing vouchers and/or Procurement and Grants Office, Centers Edward Schultz, for Disease Control and Prevention, discounts to individuals to obtain Acting Director, Procurement and Grants alarms that require resident installation. 2920 Brandywine Road, Atlanta, GA Office, Centers for Disease Control and 30341–4146, Telephone: (770) 488– Prevention. There are CDC programs currently being funded by PA 01076 in 16 states that 2700. [FR Doc. 03–29632 Filed 11–26–03; 8:45 am] provide for home installation of smoke For questions about scientific/ BILLING CODE 4163–18–P research program technical issues alarms plus general fire safety education contact, Marci Feldman, M.S., Project in households at high risk for fire, fire- Officer, Division of Violence Prevention, DEPARTMENT OF HEALTH AND related injury, and death. Programs of National Center for Injury Prevention HUMAN SERVICES this type seem reasonable, but have not and Control, Centers for Disease Control been studied scientifically to assess and Prevention, 4770 Buford Highway, Centers for Disease Control and their impact on fire-related injury NE MS K–60, Atlanta, GA 30341, Prevention outcomes. This study will assess, Telephone: (770) 488–4478. FAX: (770) through a community trial, the 488–4349. Email: [email protected]. Community Trial to Test the effectiveness of the program operating For questions about peer review Effectiveness of the Smoke Alarm prospectively in multiple communities issues, contact, Gwen Cattledge, Installation and Fire Safety Education in one state. (SAIFE) Program Scientific Review Administrator, Activities National Center for Injury Prevention Announcement Type: New. and Control, Centers for Disease Control Awardee activities for this program Funding Opportunity Number: 04058. are as follows: and Prevention, 4770 Buford Hwy, NE, Catalog of Federal Domestic (a) Develop and implement a Mailstop K–02, Atlanta, GA 30341, Assistance Number: 93.136. community trial to test the effectiveness Telephone: 770–488–1430. Email: Key Dates: [email protected]. Letter of Intent Deadline: December of the smoke alarm installation and fire For budget assistance, contact: James 29, 2003. safety education (SAIFE) Program Masone, Contracts Specialist, Application Deadline: February 17, Announcement 01076 (intervention). Procurement and Grants Office, Centers 2004. Each year a minimum of three different for Disease Control and Prevention, communities having the capacity and I. Funding Opportunity Description 2920 Brandywine Road, Atlanta, GA willingness to implement smoke alarm 30341–4146, Telephone: 770–488–2736. installation combined with fire safety Authority: This program is authorized education for one year (intervention FAX: 770–488–2671. Email: under section 317 and 391 of the Public [email protected]. Health Service Act (42 U.S.C. 247b and communities) will participate; and three 280b), as amended. comparison communities will not VIII. Other Information receive the intervention (control References: Purpose communities). Control communities 1. National Center for Injury The purpose of this program is to should not become intervention Prevention and Control. CDC Injury evaluate strategies to reduce the number communities in subsequent years to

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00039 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66835

ensure research findings are not have longer follow-up periods than Approximate Number of Awards: contaminated during follow-up. At least others. One. nine intervention and nine control (f) The research team, including a Approximate Average Award: communities must be enrolled over research project coordinator, should $250,000. three years. Program activities at the provide oversight for the research Floor of Award Range: $250,000. intervention sites are funded by activities to each community selected. Ceiling of Award Range: $250,000. program announcement 01076, and Year one will address design and Anticipated Award Date: September should be used for these sites only. preparation issues, including the 1, 2004. Additionally, in order to test for the development of materials for Budget Period Length: 12 months. effectiveness of the intervention Institutional Review Board (IRB). Years Project Period Length: Five years. accurately, intervention and control two through four will emphasize Throughout the project period, CDC’s communities must not have previously implementation of intervention and commitment to continuation of awards received funding from CDC or United control community activities including will be conditioned on the availability States Fire Administration (USFA) for data collection. Year five will include of funds, evidence of satisfactory residential fire-related injury prevention final months of follow-up activities and progress by the recipient (as programs. Non-intensive, relatively data analysis. documented in required reports), and small awards, such as funding for In a cooperative agreement, CDC staff the determination that continued equipment or education only programs, is substantially involved in the program funding is in the best interest of the will not disqualify a community. activities, above and beyond routine Federal Government. With satisfactory progress on this community trial, (b) Study sites must target vulnerable grant monitoring. CDC Activities for this program are as funding for program activities (program populations (e.g., children under five, follows: announcement 01076) is expected to adults age 65 and older, persons with (a) Partner in a substantial way in all continue so that this community trial low social economic status) and include activities, especially with regard to can be completed. each year at least one urban, one understanding best practices and suburban, and one rural community. All evidence that can be applied to III. Eligibility Information communities should have a population intervention design for fire prevention. 1. Eligible Applicants of approximately 50,000. These may be (b) Provide technical consultation and counties, cities, or neighborhoods. All advice through routine meetings and Applications may be submitted by communities should demonstrate fire conference calls with the awardee and public and private nonprofit and for incidence rates above the national any local partners on all aspects of profit organizations and by governments average. intervention design, methods, analysis and their agencies, such as: (c) Control communities should be • Public nonprofit organizations. planning, and other recipient activities. • matched on urban/suburban/rural Private nonprofit organizations. (c) Provide up-to-date scientific • status, type(s) of vulnerable information about fire-related injuries For profit organizations. • Small, minority, women-owned populations, and approximate on a national scope and with respect to businesses. population size. specific regions and population groups. • Universities. (d) Intervention communities will (d) Partner and collaborate with the • Colleges. awardee in development and refinement receive the smoke alarm installation and • Research institutions. fire safety education program funded by of the intervention. • Hospitals. (e) Partner in developing a research program announcement 01076. • Community-based organizations protocol for annual IRB review by all Therefore, the intervention should (including faith-based organizations). facilitate the acquisition, distribution cooperating institutions participating in • State and local governments or their and proper installation of long-lasting, the research study. The CDC IRB will Bona Fide Agents (this includes the lithium-powered smoke alarms and fire review and approve the protocol District of Columbia, the initially and on at least an annual basis safety education for targeted Commonwealth of Puerto Rico, the until the research study is completed. communities through the collaborative Virgin Islands, the Commonwealth of (f) Ensure human subjects assurances efforts of fire safety personnel and/or the Northern Marianna Islands, community workers. are in place and in effect. (g) Monitor and evaluate the scientific American Samoa, Guam, the Federated (e) In partnership and collaboration States of Micronesia, the Republic of the with an academic or research and operational accomplishments of the project. This will be accomplished Marshall Islands, and the Republic of institution, develop a community trial Palau) study design with intervention and through periodic site visits, telephone • calls, electronic communication, Political subdivisions of States (in control communities (as described consultation with States). above). Follow-up assessments for each technical and data reports and interim data analyses. A Bona Fide Agent is an agency/ intervention community should include (h) Facilitate collaborative efforts to organization identified by the state as assessment of the continued presence compile and disseminate research eligible to submit an application under and functionality of intervention- results through presentations at the state eligibility in lieu of a state installed smoke alarms. Outcomes to be scientific conferences and publications application. If you are applying as a measured in both intervention and in peer-reviewed public health journals. bona fide agent of a state or local control communities should include a government, you must provide as a comparison of pre- and post- II. Award Information letter from the state or local government intervention residents’ knowledge, Type of Award: Cooperative as documentation of your status. Place attitudes, beliefs, and behaviors; fire Agreement. this documentation behind the first page incidence, injuries, and deaths. Follow- CDC involvement in this program is of your application form. up on injuries and deaths will require listed in the Activities Section above. partnering with local hospitals. Fiscal Year Funds: FY 2004. 2. Cost Sharing or Matching Depending upon when communities Approximate Total Funding: Matching funds are not required for enter the study, some communities will $250,000. this program.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00040 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66836 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

3. Other Eligibility Requirements IV. Application and Submission Your research plan should address Information activities to be conducted over the If your application is incomplete or entire project period. 1. Address To Request Application non-responsive to the requirements You are required to have a Dun and Package listed below, it will not be entered into Bradstreet Data Universal Numbering the review process. You will be notified To apply for this funding opportunity, System (DUNS) number to apply for a that your application did not meet the use application form PHS 398 (OMB grant or cooperative agreement from the submission requirements. number 0925–0001 rev. 5/2001). Forms Federal government. Your DUNS 1. The applicant (or team) must and instructions are available in an number must be entered in item 11 of provide evidence of prior experience in interactive format on the CDC Web site, the face page of the PHS 398 application designing, implementing, and at the following Internet address: form. The DUNS number is a nine-digit evaluating community-based programs, www.cdc.gov/od/pgo/forminfo.htm. identification number, which uniquely including evaluation of knowledge, Forms and instructions are also identifies business entities. Obtaining a attitudes, beliefs, and behaviors; available in an interactive format on the DUNS number is easy and there is no evidence of prior experience with National Institutes of Health (NIH) Web charge. To obtain a DUNS number, implementing rigorous experimental site at the following Internet address: access www.dunandbradstreet.com or studies; and/or experience with http://grants.nih.gov/grants/funding/ call 1–866–705–5711. For more accessing and linking appropriate phs398/phs398.html. information, see the CDC Web site at community level data with clinical, If you do not have access to the http://www.cdc.gov/od/pgo/funding/ medical, and fire data. The applicant Internet, or if you have difficulty pubcommt.htm. must include documentation of this accessing the forms on-line, you . Submission Dates and Times experience such as publications from contact the CDC Procurement and peer-reviewed journals. Grants Office Technical Information LOI Deadline Date: December 29, 2. The applicant must provide Management Section (PGO-TIM) staff at: 2003. evidence of effective and well-defined 770–488–2700. Application forms can Application Deadline Date: February collaborative relationships needed to be mailed to you. 17, 2004. ensure the implementation of the 2. Content and Form of Application Explanation of Deadlines: proposed activities. The collaboration Submission Applications must be received in the must include at least a State Health CDC Procurement and Grants Office by Department (to provide leadership Letter of Intent (LOI) 4 p.m. eastern time on the deadline regarding local public health priorities), CDC requests that you send a LOI if date. If you send your application by the academic or research institution (to you intend to apply for this program. United States Postal Service or provide scientific and methodological Although the LOI is not required, not commercial delivery service, you must expertise), fire prevention agencies (to binding, and does not enter into the ensure that the carrier will be able to provide guidance in community review of your subsequent application, guarantee delivery of the application by implementation activities), and local your LOI will be used to gauge the level the closing date and time. If CDC hospitals for follow-up of medical of interest in this program, and to allow receives your application after closing outcomes. The applicant must include CDC to plan the application review. due to: (1) Carrier error, when the letters of support that describe the Your LOI must be written in the carrier accepted the package with a specific commitments and following format: guarantee for delivery by the closing responsibilities that will be undertaken • Maximum number of pages: 2. date and time, or (2) significant weather delays or natural disasters, you will be by the collaborating organizations. • Font size: 12-point unreduced. given the opportunity to submit 3. The applicant must be funded • Paper size: 8.5 by 11 inches. • documentation of the carrier’s currently by CDC Program Single spaced. guarantee. If the documentation verifies • Announcement 01076 to perform Page margin size: one inch. a carrier problem, CDC will consider the • community-based smoke alarm Printed only on one side of page. application as having been received by installation and fire safety education • Written in English, avoid jargon. the deadline. activities, and their project period does Your LOI must contain the following This announcement is the definitive not need to extend through the period information: guide on application submission of this community trial. • Descriptive title of the proposed address and deadline. It supersedes 4. Requested funding amount should research. information provided in the application not be greater than the ceiling of the • Name, address, E-mail address, and instructions. If your application does award range. telephone number of the Principal not meet the deadline above, it will not 5. Principal investigators (PI’s) are Investigator. be eligible for review, and will be encouraged to submit only one proposal • Names of other key personnel. discarded. You will be notified that you in response to this program • Participating institutions. did not meet the submission announcement. With few exceptions • Number and title of this Program requirements. (e.g., research issues needing immediate Announcement (PA). CDC will not notify you upon receipt of your application. If you have a public health attention), only one Application application per PI will be funded under question about the receipt of your this announcement. Follow the PHS 398 application application, first contact your courier. If instructions for content and formatting you still have a question, contact the Note: Title 2 of the United States Code section 1611 states that an organization of your application. For further PGO–TIM staff at: 770–488–2700. Before described in section 501(c)(4) of the Internal assistance with the PHS 398 application calling, please wait two to three days Revenue Code that engages in lobbying form, contact GrantsInfo, Telephone after the application deadline. This will activities is not eligible to receive Federal (301) 435–0714, e-mail: allow time for applications to be funds constituting an award, grant, or loan. [email protected]. processed and logged.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00041 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66837

4. Intergovernmental Review The application does not need to be Investigator: Is the investigator strong in all categories to be judged appropriately trained and well suited to Executive Order 12372 does not apply likely to have major scientific impact carry out this work? Is the work to this program. and thus deserve a high priority score. proposed appropriate to the experience 5. Funding Restrictions For example, an investigator may level of the principal investigator and propose to carry out important work other researchers? Is there a prior Restrictions, which must be taken into that by it’s nature is not innovative, but history of implementing injury-related account while writing your budget, are is essential to move a field forward. research? Does the applicant document as follows: None The criteria are as follows: capacity to accomplish the proposed If you are requesting indirect costs in Significance: Does this study address study as demonstrated by relevant past your budget, you must include a copy an important problem? If the aims of the or current injury prevention studies and of your indirect cost rate agreement. If application are achieved, how will smoke alarm program activities? your indirect cost rate is a provisional scientific knowledge be advanced? What Environment: Does the scientific rate, the agreement must be less than 12 will be the effect of these studies on the environment in which the work will be months of age. concepts or methods that drive this done contribute to the probability of 6. Other Submission Requirements field? success? Do the proposed experiments Approach: Are the conceptual take advantage of unique features of the LOI Submission Address: Submit your framework, design, methods, and scientific environment or employ useful LOI by express mail, delivery mail, analyses adequately developed, well- collaborative arrangements? delivery service, fax or e-mail to: Robin integrated, and appropriate to the aims Is there evidence of institutional Forbes, Centers for Disease Control and of the project? Does the applicant support? Does the applicant describe the Prevention, National Center for Injury describe the specific questions this personnel and study collaborators Prevention and Control, 4770 Buford research is intended to address? Does needed to accomplish the proposed Hwy., NE., Mailstop K–62, Atlanta, GA the applicant describe the hypotheses to activities? Does the applicant provide 30341, Fax: 770–488–1662, Telephone: be tested, the specific study goals, evidence that the study personnel have 770–488–4037, E-mail: [email protected]. measurable objectives, and outcomes? the expertise and capacity to Application Submission Address: Does the applicant acknowledge accomplish the proposed activities and Submit the signed original and five potential problem areas and consider to provide appropriate scientific copies of your application by mail or alternative tactics? oversight necessary to fulfill study goals express delivery service to: Technical Does the project include plans to and objectives? Information Management—PA# 04058, measure progress toward achieving the Is there an appropriate degree of Procurement and Grants Office, Centers stated objectives? Is there an appropriate commitment and cooperation of other for Disease Control and Prevention, work plan included? Does the applicant interested parties as evidenced by letters 2920 Brandywine Road, Atlanta, GA provide a detailed time-line for the first detailing the nature and extent of their 30341. year of the study as well as a projected involvement? Is there evidence of the Applications may not be submitted time-line for the subsequent four years? experience and capacity for all key staff electronically at this time. Has the applicant clearly described members including Curriculum Vitaes how intervention and comparison and position descriptions? V. Application Review Information communities will be selected? Is there a continuation plan in the 1. Criteria Is there a statement as to whether the event that key staff leave the project? plans for recruitment and outreach for How will new staff be integrated You are required to provide measures study participants include the process smoothly into the project, and what of effectiveness that will demonstrate of establishing partnerships with assurances are there that resources will the accomplishment of the various communities and recognition of mutual be available when needed for this identified objectives of the cooperative benefits? Is there evidence of effective project? agreement. Measures of effectiveness working relationships between the Additional Review Criteria: In must relate to the performance goals applicant and community addition to the above criteria, the stated in the ‘‘Purpose’’ section of this organizations? Does the applicant following items will be considered in announcement. Measures must be describe experience in developing the determination of scientific merit and objective and quantitative, and must community partnerships and the priority score: measure the intended outcome. These community’s current and anticipated Study Samples: Are the samples measures of effectiveness must be capacity to carry out the proposed rigorously defined to permit complete submitted with the application and will activities? Is there evidence that the independent replication at another site? be an element of evaluation. applicant is successfully reaching Have the referral sources been The goals of CDC-supported research communities and households under described, including the definitions and are to advance the understanding of Program Announcement 01076? criteria? What plans have been made to biological systems, improve the control Are there adequate plans for data include women and minorities and their and prevention of disease, and enhance collection and data management subgroups as appropriate for the health. In the written comments, including security of data, assurance of scientific goals of the research? How reviewers will be asked to evaluate the participant confidentially, data entry, will the applicant deal with recruitment application in order to judge the editing, and quality assurance and retention of subjects? likelihood that the proposed research procedures? Is there a statistical analysis Dissemination: What plans have been will have a substantial impact on the plan appropriate for the study design? articulated for sharing the research pursuit of these goals. The scientific Innovation: Does the project employ findings? review group will address and consider novel concepts, approaches or methods? Measures of Effectiveness: Applicants each of the following criteria in Are the aims original and innovative? are required to provide measures of assigning the application’s overall score, Does the project challenge existing effectiveness that will demonstrate the weighting them as appropriate for each paradigms or develop new accomplishment of the various application. methodologies or technologies? identified objectives of the cooperative

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00042 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66838 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

agreement. Measures must be objective Announcement will be evaluated for secondary review in a similar capacity and quantitative and must measure the scientific and technical merit by an as the ACIPC Federal agency experts to intended outcomes. These measures of appropriate peer review group convened assure that research priorities of the effectiveness will be submitted with the by the NCIPC in accordance with the announcement are understood and to application and will be an element of review criteria listed above. As part of provide background regarding current evaluation. The Special Emphasis Panel the initial merit review, all applications research activities. Only SPRS members shall assure that measures set forth in will: will vote on funding recommendations, the application are in accordance with • Undergo a process in which only and their recommendations will be CDC’s performance plans. How those applications deemed to have the carried over to the entire ACIPC for adequately has the applicant addressed highest scientific merit, generally the voting by the ACIPC members in closed these measures? top half of the applications under session. If any further review is needed Protection of Human Subjects from review, will be discussed and assigned by the ACIPC, regarding the Research Risks: Does the application a priority score. recommendations of the SPRS, the adequately address the requirements of • Receive a written critique. • factors considered will be the same as title 45 CFR part 46 for the protection Receive a second level review by those considered by the SPRS. of human subjects? This will not be the Science and Program Review The committee’s responsibility is to scored; however, an application can be Section (SPRS) of the Advisory develop funding recommendations for disapproved if the research risks are Committee for Injury Prevention and the NCIPC Director based on the results sufficiently serious and protection Control (ACIPC). of the primary review, the relevance and against risks is so inadequate as to make Applications which are complete and balance of proposed research relative to the entire application unacceptable. responsive may be subjected to a the NCIPC programs and priorities, and Inclusion of Women and Minorities in preliminary evaluation (streamline to assure that unwarranted duplication Research: Does the application review) by a peer review committee, the of federally-funded research does not adequately address the CDC Policy NCIPC Initial Review Group (IRG), to occur. The secondary review committee requirements regarding the inclusion of determine if the application is of has the latitude to recommend to the woman, ethnic, and racial groups in the sufficient technical and scientific merit NCIPC Director, to reach over better to warrant further review by the IRG. proposed research? This includes: (1) ranked proposals in order to assure CDC will withdraw from further The proposed plan for the inclusion of maximal impact and balance of consideration applications judged to be both sexes and racial and ethnic proposed research. The factors to be noncompetitive and promptly notify the minority populations for appropriate considered will include: representation; (2) The proposed principal investigator/program director a. The results of the primary review justification when representation is and the official signing for the applicant including the application’s priority limited or absent; (3) A statement as to organization. Those applications judged score as the primary factor in the whether the design of the study is to be competitive will be further selection process. adequate to measure differences when evaluated by a dual review process. b. The relevance and balance of warranted; and (4) A statement as to All awards will be determined by the proposed research relative to the NCIPC whether the plans for recruitment and Director of the NCIPC based on priority programs and priorities. outreach for study participants include scores assigned to applications by the c. The significance of the proposed the process of establishing partnerships primary review committee IRG, activities in relation to the priorities and with community(ies) and recognition of recommendations by the secondary objectives stated in ‘‘Healthy People mutual benefits. review committee of the SPRS of the 2010’’ (http://www.healthypeople.gov/), Inclusion of Children as Participants ACIPC, consultation with NCIPC senior the Institute of Medicine report, in Research Involving Human Subjects: staff, and the availability of funds. ‘‘Reducing the Burden of Injury,’’ and The NIH maintains a policy that The primary review will be a peer the ‘‘CDC Injury Research Agenda’’ children (i.e., individuals under the age review conducted by the IRG. All (http://www.cdc.gov/ncipc/pub-res/ of 21) must be included in all human applications will be reviewed for research_agenda). subjects research, conducted or scientific merit using current National d. Budgetary considerations. supported by the NIH, unless there are Institutes of Health (NIH) criteria (a VI. Award Administration Information scientific and ethical reasons not to scoring system of 100–500 points) to include them. This policy applies to all evaluate the methods and scientific 1. Award Notices quality of the application. initial (Type 1) applications submitted Successful applicant will receive a for receipt dates after October 1, 1998. The secondary review will be conducted by the SPRS of the ACIPC. Notice of Grant Award (NGA) from the Budget: The reasonableness of the CDC Procurement and Grants Office. proposed budget and the requested The ACIPC Federal agency experts will be invited to attend the secondary The NGA shall be the only binding, period of support in relation to the authorizing document between the proposed research. review and will receive modified briefing books (i.e., abstracts, strengths recipient and CDC. The NGA will be 2. Review and Selection Process and weaknesses from summary signed by an authorized Grants Applications will be reviewed for statements, and project officer’s briefing Management Officer (GMO), and mailed completeness by the Procurement and materials). ACIPC Federal agency to the recipient fiscal officer identified Grants Office (PGO) and for experts will be encouraged to in the application. responsiveness by the NCIPC. participate in deliberations when 2. Administrative and National Policy Incomplete applications and applications address overlapping areas Requirements applications that are non-responsive of research interest, so that unwarranted will not advance through the review duplication in federally-funded research 45 CFR Part 74 and 92 process. You will be notified that you can be avoided and special subject area For more information on the Code of did not meet submission requirements. expertise can be shared. The NCIPC Federal Regulations, see the National Applications that are complete and Division Associate Directors for Science Archives and Records Administration at responsive to the Program (ADS) or their designees will attend the the following Internet address: http://

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00043 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66839

www.access.gpo.gov/nara/cfr/cfr-table- Additional information on these 488–2721, E-mail address: search.html. requirements can be found on the CDC [email protected]. The following additional Web site at the following Internet VIII. Other Information—None requirements apply to this project: address: http://www.cdc.gov/od/pgo/ • AR–1 Human Subjects funding/ARs.htm. Dated: November 20, 2003. Requirements 3. Reporting Edward J. Schultz, • AR–2 Requirements for Inclusion of You must provide CDC with an Acting Director, Procurement and Grants Women and Racial and Ethnic Office, Centers for Disease Control and Minorities in Research original, plus two copies of the Prevention. • following reports: AR–8 Public Health System [FR Doc. 03–29634 Filed 11–26–03; 8:45 am] Reporting Requirements 1. Interim progress report, (PHS 2590, • AR–9 Paperwork Reduction Act OMB Number 0925–0001, rev. 5/2001) BILLING CODE 4163–18–P Requirements no less than 90 days before the end of • AR–10 Smoke-Free Workplace the budget period. The progress report DEPARTMENT OF HEALTH AND Requirements will serve as your non-competing HUMAN SERVICES • AR–11 Healthy People 2010 continuation application, and must • AR–12 Lobbying Restrictions contain the following elements: National Institutes of Health • AR–14 Accounting System a. Current Budget Period Activities Requirements Objectives. National Institute on Deafness and • AR–15 Proof of Non-Profit Status b. Current Budget Period Financial Other Communication Disorders; • AR–16 Security Clearance Progress. Notice of Meeting Requirement c. New Budget Period Program • AR–21 Small, Minority, and Proposed Activity Objectives. Pursuant to section 10(d) of the Women-Owned Business d. Detailed Line-Item Budget and Federal Advisory Committee Act, as • AR–22 Research Integrity amended (5 U.S.C. Appendix 2), notice • Justification. AR–23 States and Faith-Based e. Additional Requested Information. is hereby given of a meeting of the Organizations 2. Financial status report, no more National Deafness and Other • AR–24 Health Insurance Portability than 90 days after the end of the budget Communication Disorders Advisory and Accountability Act period. Council. Requirements The meeting will be open to the • 3. Final financial and performance AR–25 Release and Sharing of Data reports, no more than 90 days after the public as indicated below, with Starting with the December 1, 2003, end of the project period. attendance limited to space available. receipt date, all NCIPC funded Individuals who plan to attend and investigators seeking more than VII. Agency Contacts need special assistance, such as sign $500,000 in total costs in a single year For general questions about this language interpretation or other are expected to include a plan announcement, contact: Technical reasonable accommodations, should describing how the final research data Information Management Section— notify the Contact Person listed below will be shared/released or explain why PA#04058, Procurement and Grants in advance of the meeting. data sharing is not possible. Details on Office, Centers for Disease Control and The meeting will be closed to the data sharing/release, including the Prevention, 2920 Brandywine Road, public in accordance with the timeliness and name of the project data Atlanta, GA 30341, Telephone: 770– provisions set forth in sections steward, should be included in a brief 488–2700. 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., paragraph immediately following the For scientific/research program as amended. The grant applications and Research Plan Section of the PHS 398 technical assistance, contact: Mick the discussions could disclose form. References to data sharing/release Ballesteros, PhD, Project Officer, confidential trade secrets or commercial may also be appropriate in other Division of Unintentional Injury property such as patentable material, sections of the application (e.g., Prevention, National Center for Injury and personal information concerning background and significance, human Prevention and Control, Centers for individuals associated with the grant subjects requirements, etc.) The content Disease Control and Prevention, 4770 applications, the disclosure of which of the data sharing/release plan will Buford Highway, NE., Mailstop K–63, would constitute a clearly unwarranted vary, depending on the data being Atlanta, GA 30341, Telephone: 770– invasion of personal privacy. collected and how the investigator is 488–1308, E-mail address: Name of Committee: National Deafness and planning to share the data. The data [email protected]. Other Communication Disorders Advisory sharing/release plan will not count For questions about peer review, Council. towards the application page limit and contact: Gwen Cattledge, Scientific Date: , 2004. will not factor into the determination Review Administrator, National Center Open: 8:30 a.m. to 11:30 a.m. scientific merit or priority scores. for Injury Prevention and Control, Agenda: Staff reports on divisional, programmatic and special activities. Investigators should seek guidance from Centers for Disease Control and Place: National Institutes of Health, their institutions, on issues related to Prevention, 4770 Buford Highway, NE., Building 31, 31 Center Drive, Conference institutional policies, local IRB rules, as Mailstop K–02, Atlanta, GA 30341, Room 6, Bethesda, MD 20892. well as local, state and Federal laws and Telephone: 770–488–1430, E-mail Closed: 11:30 a.m. to Adjournment. regulations, including the Privacy Rule. address: gxc8@cdc. Agenda: To review and evaluate grant Further detail on the requirements for For financial, grants management, or applications. addressing data sharing in applications budget assistance, contact: Nancy Pillar, Place: National Institutes of Health, for NCIPC funding may be obtained by Grants Management (or Contract) Building 31, 31 Center Drive, Conference Room 6, Bethesda, MD 20892. contacting NCIPC program staff or Specialist, Procurement and Grants Contact Person: Craig A. Jordan, PhD, visiting the NCIPC Internet Web site at Office, Centers for Disease Control and Director, Division of Extramural Activities, http://www.cdc.gov/ncipc/osp/ Prevention, 2920 Brandywine Road, NIDCD, NIH, Executive Plaza South, Room sharing_policy.htm. Atlanta, GA 30341, Telephone: 770– 400C, 6120 Executive Blvd., Bethesda, MD

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00044 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66840 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

20892–7180, 301–496–8693, (Catalogue of Federal Domestic Assistance Place: National Institutes of Health, [email protected]. Program Nos. 93.271, Alcohol Research Natcher Building, 45 Center Drive Bethesda, If the interest of security, NIH has Career Development Awards for Scientists MD 20892 (Telephone Conference Call). instituted stringent procedures for entrance and Clinicians; 93.272, Alcohol National Contact Person: H. George Hausch, PhD, into the building by non-government Research Service Awards for Research Acting Director, 4500 Center Drive, Natcher employees. Persons without a government Training; 93.273, Alcohol Research Programs; Building, Rm 4AN44F, National Institutes of I.D. will need to show a photo I.D. and sign- 93.891, Alcohol Research Center Grants, Health, Bethesda, MD 20892, (301) 594–2372, in at the security desk upon entering the National Institutes of Health, HHS) [email protected]. building. Dated: November 20, 2003. Information is also available on the Name of Committee: National Institute of LaVerne Y. Stringfield, Institute’s/Center’s Home page: Dental and Craniofacial Research Special www.nidcd.nih.gov/about/councils/ndccdac/ Director, Office of Federal Advisory Emphasis Panel, 04–29, Review of R21s.. ndcdac.htm, where an agenda and any Committee Policy. Date: , 2003. additional information for the meeting will [FR Doc. 03–29638 Filed 11–26–03; 8:45 am] Time: 1 p.m. to 2:30 p.m. be posted when available. BILLING CODE 4140–01–M Agenda: To review and evaluate grant (Catalogue of Federal Domestic Assistance applications. Program Nos. 93.173, Biological Research Place: National Institutes of Health, Related to Deafness and Communicative DEPARTMENT OF HEALTH AND Natcher Building, 45 Center Drive, Bethesda, Disorders, National Institutes of Health, HHS) HUMAN SERVICES MD 20892, (Telephone Conference Call). Dated: November 20, 2003. Contact Person: Rebecca Roper, MS, MpH, LaVerne Y. Stringfield, National Institutes of Health Scientific Review Administrator, Scientific Director, Office of Federal Advisory Review Branch, Division of Extramural Committee Policy. National Institute of Dental & Craniofacial Research; Notice of Research, National Inst of Dental & [FR Doc. 03–29636 Filed 11–26–03; 8:45 am] Closed Meetings Craniofacial Research, National Institutes of BILLING CODE 4140–01–M Health, 45 Center Dr., room 4AN32E, Pursuant to section 10(d) of the Bethesda, MD 20892, 301 451–5096. Federal Advisory Committee Act, as Name of Committee: National Institute of DEPARTMENT OF HEALTH AND Dental and Craniofacial Research Special HUMAN SERVICES amended (5 U.S.C. Appendix 2), notice is hereby given of the following Emphasis Panel, 04–27, Review of R13s. meetings. Date: January 22, 2004. National Institutes of Health Time: 2 p.m. to 4 p.m. The meetings will be closed to the National Institute on Alcohol Abuse Agenda: To review and evaluate grant public in accordance with the applications. and Alcoholism; Notice of Closed provisions set forth in sections 552(c)(4) Meeting Place: National Institutes of Health, and 552b(c)(6), Title 5 U.S.C., as Natcher Building, 45 Center Drive, Bethesda, Pursuant to section 10(d) of the amended. The grant applications and MD 20892, (Telephone Conference Call). Federal Advisory Committee Act, as the discussions could disclose Contact Person: H. George Hausch, PhD, amended (5 U.S.C. Appendix 2), notice confidential trade secrets or commercial Acting Director, 4500 Center Drive, Natcher is hereby given of the following property such as patentable material, Building, Rm. 4AN44F, National Institutes of meeting. and personal information concerning Health, Bethesda, MD 20892, (303) 594–2372, The meeting will be closed to the individuals associated with the grant [email protected]. public in accordance with the applications, the disclosure of which Name of Committee: National Institute of provisions set forth in sections would constitute a clearly unwarranted Dental and Craniofacial Research Special 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., invasion of personal privacy. Emphasis Panel, 04–24, Review of R01s. as amended. The grant applications and Name of Committee: National Institute of Date: , 2004. the discussions could disclose Dental and Craniofacial Research Special Time: 8 a.m. to 5 p.m. confidential trade secrets or commercial Emphasis Panel, 04–23, Review of R21s. Agenda: To review and evaluate grant property such as patentable material, Date: December 2, 2003. applications. and personal information concerning Time: 10:30 a.m. to 12 p.m. Place: Bethesda Marriott Suites, 6711 individuals associated with the grant Agenda: To review and evaluate grant Democracy Boulevard, Bethesda, MD 20817. applications. Contact Person: Rebecca Roper, MS MpH, applications, the disclosure of which Place: National Institutes of Health, would constitute a clearly unwarranted Natcher Building, 45 Center Drive, Bethesda, Scientific Review Administrator, Scientific invasion of personal privacy. MD 20892, (Telephone Conference Call). Review Branch, Division of Extramural Research, National Inst of Dental & Name of Committee: National Institute on Contact Person: Rebecca Roper, MS, MpH, Alcohol Abuse and Alcoholism Special Scientific Review Administrator, Scientific Craniofacial Research, National Institutes of Emphasis Panel, ZAA1 CC (02) National Review Branch, Division of Extramural Health, 45 Center Dr., room 4AN32E, Alcohol Screening Day AEM Department Research, National Inst of Dental & Bethesda, MD 20892, 301 451–5096. Craniofacial Research National Institutes of Collaboration—RFA AA04–001. (Catalogue of Federal Domestic Assistance Health, 45 Center Dr., room 4AN32E, Date: December 16, 2003. Program Nos. 93.121, Oral Diseases and Time: 8:30 a.m. to 4:30 p.m. Bethesda, MD 20892, 301 451–5096. Disorders Research, National Institutes of Agenda: To review and evaluate grant This notice is being published less than 15 applications. days prior to the meeting due to the timing Health, HHS) Place: Double Tree Rockville, 1750 limitations imposed by the review and Dated: November 20, 2003. Rockville Pike, Rockville, MD 20852. funding cycle. LaVerne Y. Stringfield, Contact Person: Mahadev Murthy, PhD, Name of Committee: National Institute of Director, Office of Federal Advisory Scientific Review Administrator, Extramural Dental and Craniofacial Research Special Committee Policy. Project Review Branch, Office of Scientific Emphasis Panel, 04–26, Review of R13s. Affairs, National Institute on Alcohol Abuse, Date: December 11, 2003. [FR Doc. 03–29639 Filed 11–26–03; 8:45 am] and Alcoholism, 6000 Executive Blvd, Suite Time: 2 p.m. to 4 p.m. BILLING CODE 4140–01–M 409, Bethesda, MD 20892–7003, (301) 443– Agenda: To review and evaluate grant 2860. applications.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66841

DEPARTMENT OF HEALTH AND The meeting will be closed to the confidential trade secrets or commercial HUMAN SERVICES public in accordance with the property such as patentable material, provisions set forth in sections and personal information concerning National Institutes of Health 552b(c)(4) and 552b(c)(b), Title 5 U.S.C., individuals associated with the grant as amended. The grant applications and applications, the disclosure of which National Institute of Allergy and the discussions could disclose would constitute a clearly unwarranted Infectious Diseases; Notice of Closed confidential trade secrets or commercial invasion of personal privacy. Meeting property such as patentable material, Name of Committee: Center for Scientific Pursuant to section 10(d) of the and personal information concerning Review Special Emphasis Panel, Genomics of Federal Advisory Committee Act, as individuals associated with the grant Eye Disorder. amended (5 U.S.C. Appendix 2), notice applications, the disclosure of which Date: December 2, 2003. is hereby given of the following would constitute a clearly unwarranted Time: 3 p.m. to 4:30 p.m. meeting. invasion of personal privacy. Agenda: To review and evaluate grant applications. The meeting will be closed to the Name of Committee: National Institute of Place: National Institutes of Health, 6701 public in accordance with the Environmental Sciences Special Emphasis Rockledge Drive, Bethesda, MD 20892 provisions set forth in sections Panel. To Review Program Project (Telephone Conference Call). Applications. 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Contact Person: Camilla E. Day, PhD, as amended. The grant applications and Date: –3, 2004. Time: 7 p.m. to 5 p.m. Scientific Review Administrator, Center for the discussions could disclose Scientific Review, National Institutes of confidential trade secrets or commercial Agenda: To review and evaluate grant applications. Health, 6701 Rockledge Drive, Room 2212, property such as patentable material, Place: Doubletree Guest Suites, 2515 MISC 7890, Bethesda, MD 20892, (301) 435– and personal information concerning Meridian Parkway, Research Triangle Park, 1037, [email protected]. individuals associated with the grant NC 27713. This notice is being published less than 15 applications, the disclosure of which Contact Person: Linda K. Bass, PhD., days prior to the meeting due to the timing would constitute a clearly unwarranted Scientific Review Administrator, Scientific limitations imposed by the review and invasion of personal privacy. Review Branch, Office of Program funding cycle. Operations, Division of Extramural Research Name of Committee: National Institute of Name of Committee: Center for Scientific and Training, National Institute of Review Special Emphasis Panel, Gene Allergy and Infectious Diseases Special Environmental Health Sciences, PO Box Emphasis Panel, B Cell Regulation and Expression in Neural Development in the 12233, MD EC–30, Research Triangle Park, Frog. Function. NC 27709, (919) 541–1307. Date: December 16, 2003. Date: December 4, 2003. Time: 10 a.m. to 12 p.m. (Catalogue of Federal Domestic Assistance Time: 2 p.m. to 3 p.m. Agenda: To review and evaluate grant Program Nos. 93.115, Biometry and Risk Agenda: To review and evaluate grant applications. Estimation—Health Risks from applications. Place: National Institutes of Health/NIAID, Environmental Exposure; 93.142, NIEHS Place: National Institutes of Health, 6701 6700 B Rockledge Drive, Room 3131, Hazardous Waste Worker Health and Safety Rockledge Drive, Bethesda, MD 20892 Bethesda, MD 20892, (Telephone Conference Training; 93.143; NIEHS Superfund (Telephone Conference Call). Call). Hazardous Substances—Basic Research and Contact Person: James P. Harwood, PhD, Contact Person: Katherine L. White, PhD, Education; 93.894, Resources and Manpower Scientific Review Administrator, Center for Scientific Review Administrator, AIDS Development in the Environmental Health Scientific Review, National Institutes of Preclinical Research Review Branch, Sciences; 93.113, Biological Response to Health, 6701 Rockledge Drive, Room 5168, Scientific Review Program, NIH/NIAID, 6700 Environmental Health Hazardous; 93.114, MISC 7840, Bethesda, MD 20892, (301) 435– B Rockledge Drive, Room 3131, Bethesda, Applied Toxicological Research and Testing, 1256, [email protected]. National Institutes of Health, HHS) MD 20892, (301) 435–1615, [email protected]. This notice is being published less than 15 (Catalogue of Federal Domestic Assistance Dated: November 21, 2003. days prior to the meeting due to the timing Program Nos. 93.855, Allergy, Immunology, LaVerne Y. Stringfield, limitations imposed by the review and and Transplantation Research; 93.856, Director, Office of Federal Advisory funding cycle. Microbiology and Infectious Diseases Committee Policy. Name of Committee: Center for Scientific Research, National Institutes of Health, HHS) [FR Doc. 03–29726 Filed 11–26–03; 8:45 am] Review Special Emphasis Panel, Dated: November 21, 2003. BILLING CODE 4140–01–M Biomechanics and Molecular Genetics. LaVerne Y. Stringfield, Date: December 4, 2003. Time: 4:30 p.m. to 6:30 p.m. Director, Office of Federal Advisory Agenda: To review and evaluate grant Committee Policy. DEPARTMENT OF HEALTH AND applications. [FR Doc. 03–29725 Filed 11–26–03; 8:45 am] HUMAN SERVICES Place: National Institutes of Health, 6701 BILLING CODE 4140–01–M Rockledge Drive, Bethesda, MD 20892 National Institutes of Health (Telephone Conference Call). Contact Person: Daniel F. McDonald, PhD, DEPARTMENT OF HEALTH AND Center for Scientific Review; Notice of Chief, Musculoskeletal, Oral and Skin HUMAN SERVICES Closed Meeting Sciences IRG, Center for Scientific Review, Pursuant to section 10(d) of the NIH, 6701 Rockledge Drive, Room 4214, MSC National Institutes of Health 7814, Bethesda, MD 20892, (301) 435–1215, Federal Advisory Committee Act, as [email protected]. amended (5 U.S.C. Appendix 2), notice National Institute of Environmental This notice is being published less than 15 Health Sciences; Notice of Closed is hereby given of the following days prior to the meeting due to the timing Meeting meeting. limitations imposed by the review and The meeting will be closed to the funding cycle. Pursuant to section 10(d) of the public in accordance with the Name of Committee: Center for Scientific Federal Advisory Committee Act, as provisions set forth in sections Review Special Emphasis Panel, Cortical amended (5 U.S.C. Appendix 2), notice 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., Pathways. is hereby given of the following as amended. The grant applications and Date: December 11, 2003. meeting. the discussions could disclose Time: 1 p.m. to 2 p.m.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00046 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66842 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Agenda: To review and evaluate grant appointed CMHS Director who will Homeland Security, Washington, DC applications. describe her vision for CMHS and 20528; telephone 202–401–1113, Place: National Institutes of Health, 6701 mental health. There will also be facsimile 202–772–9916; e-mail Rockledge Drive, Bethesda, MD 20892 discussions on workforce development, [email protected]. (Telephone Conference Call). Contact Person: Michael A. Steinmetz, national disaster and trauma, SUPPLEMENTARY INFORMATION: SAMHSA’s Children and Families PhD, Scientific Review Administrator, Center Background for Scientific Review, National Institutes of Agenda, and SAMHSA’s data strategy. Health, 6701 Rockledge Drive, Room 5172, Attendance by the public will be Section 308 of the Homeland Security MSC 7844, Bethesda, MD 20892, (301) 435– limited to space available. Public Act of 2002, Pub. L. 107–296, 1247, [email protected]. comments are welcome. Please (Homeland Security Act), as amended Name of Committee: Center for Scientific communicate with the individual listed by the Omnibus Appropriation Act of Review Special Emphasis Panel, Oral, Dental as contact below to make arrangements 2003, Pub. L. 108–7, directs the and Craniofacial Sciences SBIR/STTR to comment or to request special Department of Homeland Security Review Panel. accommodations for persons with (Department) to sponsor extramural Date: December 16, 2003. disabilities. research, development, demonstration, Time: 10 a.m. to 3 p.m. Substantive program information, a testing and evaluation programs relating Agenda: To review and evaluate grant summary of the meeting, and a roster of applications. to homeland security. As part of this Place: George Washington University Inn, Council members may be obtained program, the Department is to establish 824 New Hampshire Ave., NW., Washington, either by accessing the SAMHSA a university-based center or centers for DC 20037. Council Web site, www.samhsa.gov/ homeland security. Contact Person: J. Terrell Hoffield, DDS, council/council or by communicating The purpose of these centers is to PhD, Dental Officer, USPHS, Center for with the contact whose name and provide a locus to attract and retain Scientific Review, National Institutes of telephone number is listed below. The academic scholars in pursuit of Health, 6701 Rockledge Drive, Room 4116, transcript for the open session will also homeland security-related disciplines. MSC 7816, Bethesda, MD 20892, (301) 435– be available on the SAMHSA Council The Centers are envisioned to be an 1781, [email protected]. Web site. integral and critical component of the (Catalogue of Federal Domestic Assistant Committee Name: SAMHSA National Department’s capability to anticipate, Program Nos. 93.306, Comparative Medicine; Advisory Council. prevent, respond to, and recover from 93.333, Clinical Research, 93.306, 93.333, Date/time: Thursday, December 11, terrorist attacks. The Centers will 93.337, 93.393–93.396, 93.837–93.844, 2003, 9 a.m. to 4:30 p.m. (Open); Friday, leverage multidisciplinary capabilities 93.846–93.878, 93.892, 93.893, National December 12, 2003, 9 a.m. to 11:15 p.m. Institutes of Health, HHS) of universities and fill gaps in current (Open). knowledge. Dated: November 20, 2003. Place: Embassy Suites Hotel, Chevy Section 308(b)(2)(B) of the Homeland LaVerne Y. Stringfield, Chase Room, 4300 Military Road, NW., Security Act lists fourteen areas of Washington, DC 20015. Director, Office of Federal Advisory substantive expertise that, if Committee Policy. FOR FURTHER INFORMATION CONTACT: demonstrated, might qualify universities for designation as university-based [FR Doc. 03–29637 Filed 11–26–03; 8:45 am] Toian Vaughn, Executive Secretary, 5600 Fishers Lane, Parklawn Building, centers. The listed areas of expertise BILLING CODE 4140–01–M Room 12C–05, Rockville, MD 20857, include, among others, food safety, first Telephone: (301) 443–7016; Fax: (301) responders, multi-modal transportation, DEPARTMENT OF HEALTH AND 443–7590 and E-mail: and responding to incidents involving HUMAN SERVICES [email protected]. weapons of mass destruction. However, the list is not exclusive. Section Substance Abuse and Mental Health Dated: November 18, 2003. 308(b)(2)(C) gives the Secretary Services Administration Toian Vaughn, discretion to consider additional criteria Committee Management Officer, SAMHSA. beyond those specified in section Notice of a Meeting [FR Doc. 03–29614 Filed 11–26–03; 8:45 am] 308(b)(2)(B) in selecting universities for BILLING CODE 4162–20–P this program, as long as the Department Pursuant to Public Law 92–463, issues a Federal Register notice notice is hereby given of a meeting of explaining the criteria used for the the Substance Abuse and Mental Health designation. Services Administration (SAMHSA) DEPARTMENT OF HOMELAND National Advisory Council in December SECURITY Criteria 2003. Notice Designating University of In 2002, the National Research The SAMHSA National Advisory Southern California as Center for Council (NRC) issued a report entitled Council meeting will be open and will Homeland Security ‘‘Making the Nation Safer: The Role of include a report by the SAMHSA Science and Technology in Countering Administrator on how the Agency is AGENCY: Department of Homeland Terrorism.’’ In this report, the NRC managing its Matrix priorities and cross- Security. recommended a number of substantive cutting principles, the President’s ACTION: Notice. areas for research that could contribute Management Agenda, and SAMHSA’s to national security. Among other work in partnership with other Federal SUMMARY: The Department of Homeland issues, the NRC report identified the agencies. There will be updates on Security has designated the University need to perform risk analysis and SAMHSA’s Budget, SAMHSA’s FY 2004 of Southern California as a Center for modeling of vulnerabilities and Appropriation’s, the Charitable Choice Homeland Security (HS-Center). economic analysis of security Regulations, and the Program FOR FURTHER INFORMATION CONTACT: enhancements as areas for which Assessment Rating Tool review. In Laura Petonito, Deputy Director, research is needed. addition, the meeting will include a University Programs, Science and The Department agrees that research presentation by SAMHSA’s newly Technology Division, Department of in these areas will contribute

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00047 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66843

significantly to the Department’s ability Dated: November 21, 2003. Nonimmigrant Arrival-Departure to identify, and select among, options Melvin Bernstein, Document. for enhancing national security. Risk- Director, University Programs, Science and (3) Agency form, number, if any, and based modeling, and economic analysis, Technology Division, Department of the applicable component of the will help the Department understand Homeland Security. Department of Homeland Security the impact and consequences of [FR Doc. 03–29646 Filed 11–24–03; 11:36 sponsoring the collection: Form I–102. potential acts of terrorism, thus am] U.S. Citizenship and Immigration providing decision makers with BILLING CODE 4410–10–P Services. (4) Affected public who will be asked validated tools to evaluate or required to respond, as well as a brief vulnerabilities and identify DEPARTMENT OF HOMELAND abstract: Primary: Individuals or countermeasures and response actions. SECURITY Households. The information collection Solicitation of Interest and Designation will be used by an alien temporarily Citizenship and Immigration Services residing in the United States to request In August 2003, the Department a replacement of his or her arrival sought white papers from universities Agency Information Collection evidence. The information provided can that wished to be designated as HS- Activities: Comment Request be used to verify status and for Centers. The HS-Centers are envisioned determination as to the eligibility of the ACTION: 60-day notice of information to be an integral and critical component collection under review; application for applicant for replacement. (5) An estimate of the total number of of the new ‘‘homeland security replacement/initial nonimmigrant respondents and the amount of time complex’’ that will provide the nation arrival-departure document; form I–102. with a robust, dedicated and enduring estimated for an average respondent to capability that will enhance our ability The Department of Homeland respond: 20,000 responses at 25 minutes to anticipate, prevent, respond to, and Security (DHS), U.S. Citizenship and (.416 hours) per response. recover from terrorist attacks. The Immigration Service (CIS) has submitted (6) An estimate of the total public burden (in hours) associated with the notice, made available on the DHS the following information collection collection: 8,320 annual burden hours. Internet site (http://www.dhs.gov) and request for review and clearance in accordance with the Paperwork If you have additional comments, (http://www.orau.gov/dhsuce), suggestions, or need a copy of the identified risk-based economic Reduction Act of 1995. The proposed information collection is published to proposed information collection modeling as one of the areas of expertise instrument with instructions, or (criteria) that might merit designation. obtain comments from the public and affected agencies. Comments are additional information, please contact The Department received a number of encouraged and will be accepted for Richard A. Sloan 202–514–3291, proposals and evaluated them through a sixty days until January 27, 2004. Director, Regulations and Forms process that included the participation Written comments and suggestions Services Division, Department of of federal government and outside from the public and affected agencies Homeland Security, 425 I Street, NW., experts. After the panels of experts concerning the proposed collection of Room 4034, Washington, DC 20536. selected final potential designees, the information should address one or more Additionally, comments and/or Department conducted site visits to of the following four points: suggestions regarding the item(s) contained in this notice, especially interview the individuals who would be (1) Evaluate whether the proposed regarding the estimated public burden performing the research. Based on this collection of information is necessary and associated response time may also evaluation, the Department has selected for the proper performance of the be directed to Mr. Richard A. Sloan. the University of Southern California functions of the agency, including If additional information is required whether the information will have (USC) as the first HS-Center for this contact: Mr. Steve Cooper, PRA practical utility; program. Clearance Officer, Department of USC will conduct research on risk- (2) Evaluate he accuracy of the Homeland Security, Office of the Chief based modeling, with a particular agencies estimate of the burden of the Information Officer, Regional Office emphasis on the economic aspects. proposed collection of information, Building 3, 7th and D Streets, SW., Suite including the validity of the U.S.C. will develop an integrated set of 4636–26, Washington, DC 20202. methodology and assumptions used; models and modeling capabilities that (3) Enhance the quality, utility, and Dated: November 21, 2003. cut across several threats and targets— clarity of the information to be Richard A. Sloan, impacts on buildings and structures, collected; and Department Clearance Officer, Department of airborne biological and chemical agents, (4) Minimize the burden of collection Homeland Security, U.S. Citizenship and and cyber-terrorism. Other research of information on those who are to Immigration Services. areas besides modeling and analysis of respond, including through the use of [FR Doc. 03–29704 Filed 11–26–03; 8:45 am] risks, will be in emergency response, appropriate automated, electronic, BILLING CODE 4410–10–M consequences, economics, advanced mechanical, or other technological computation and infrastructure. U.S.C. collection techniques or other forms of is committed to ensuring that students information technology, e.g., permitting DEPARTMENT OF HOMELAND will have opportunities to develop and electronic submission of responses. SECURITY contribute to these important areas Overview of this information Citizenship and Immigration Services through hands-on training and collection: internships, as examples. Workshops for (1) Type of Information Collection: Agency Information Collection the scientific community, collaboration Extension of a currently approved Activities: Comment Request with federal laboratories, and support collection. for sabbatical visitors are additional (2) Title of the Form/Collection: ACTION: 60-day notice of information activities planned for this HS-Center. Application for Replacement/Initial collection under review; application to

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00048 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66844 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

file declaration of intention; form N– estimated for an average respondent to (1) Evaluate whether the proposed 300. respond: 433 responses at 45 minutes collection of information is necessary per response. for the proper performance of the The Department of Homeland (6) An estimate of the total public functions of the agency, including Security (DHS) and the U.S. Citizenship burden (in hours) associated with the whether the information will have and Immigration Services (CIS) has collection: 325 annual burden hours. practical utility; submitted the following information If you have additional comments, (2) Evaluate the accuracy of the collection request for review and suggestions, or need a copy of the agencies estimate of the burden of the clearance in accordance with the proposed information collection proposed collection of information, Paperwork Reduction Act of 1995. The instrument with instructions, or including the validity of the proposed information collection is additional information, please contact methodology and assumptions used; published to obtain comments from the Richard A. Sloan 202–514–3291, (3) Enhance the quality, utility, and public and affected agencies. Comments Director, Regulations and Forms clarity of the information to be are encouraged and will be accepted for Services Division, U.S. Citizenship and collected; and sixty days until January 27, 2003. Immigration Services, Department of (4) Minimize the burden of the Written comments and suggestions Homeland Security, Room 4304, 425 I collection of information on those who from the public and affected agencies Street, NW., Washington, DC 20536. are to respond, including through the concerning the proposed collection of Additionally, comments and/or use of appropriate automated, information should address one ore suggestions regarding the item(s) electronic, mechanical or other more of the following four points: contained in this notice, especially technological collection techniques or (1) Evaluate whether the proposed other forms of information technology, collection of information is necessary regarding the estimated public burden e.g. permitting electronic submission of for the proper performance of the and associated response time may also responses. functions of the agency, including be directed to Mr. Richard A. Sloan. If additional information is required Overview of this information whether the information will have collection: practical utility; contact: Mr. Steve Cooper, PRA Clearance Officer, Department of (1) Type of Information Collection: (2) Evaluate the accuracy of the Extension of a currently approved agencies estimate of the burden of the Homeland Security, Office of the Chief Information Officer, Regional Office collection. proposed collection of information, (2) Title of the Form/Collection: including the validity of the Building 3, 7th and D Streets, SW., Suite 4636–26, Washington, DC 20202. Request for Certification of Military or methodology and assumptions used; Naval Service. (3) Enhance the quality, utility, and Dated: November 21, 2003. (3) Agency form number, if any, and clarity of the information to be Richard A. Sloan, the applicable component of the collected; and Department Clearance Officer, Department of Department of Homeland Security (4) Minimize the burden of the Homeland Security, U.S. Citizenship and sponsoring the collection: Form N–426. collection of information on those who Immigration Services. U.S. Citizenship and Immigration are to respond, including through the [FR Doc. 03–29705 Filed 11–26–03; 8:45 am] Services. use of appropriate automated, BILLING CODE 4410–10–M (4) Affected public who will be asked electronic, mechanical, or other or required to respond, as well as a brief technological collection techniques or abstract: Primary: Individuals or other forms of information technology, DEPARTMENT OF HOMELAND Households. This form will be used by e.g., permitting electronic submission of SECURITY the CIS to request a verification of the responses. military or naval service claim by an Overview of this information Citizenship and Immigration Services collection: applicant filing for naturalization on the (1) Type of Information Collection: Agency Information Collection basis of honorable service in the U.S. Extension of a currently approved Activities: Comment Request armed forces. collection. (5) An estimate of the total number of (2) Title of the Form/Collection: ACTION: 60-day notice of information respondents and the amount of time Application to File Declaration of collection under review; request for estimated for an average respondent to Intention. certification of military or naval service; respond: 45,000 responses at 45 minutes (3) Agency form number, if any, and form N–426. per response. the applicable component of the (6) An estimate of the total public Department of Homeland Security The Department of Homeland burden (in hours) associated with the sponsoring the collection: Form N–300. Security (DHS) and the U.S. Citizenship collection: 33,750 annual burden hours. U.S. Citizenship and Immigration and Immigration Services (CIS), has If you have additional comments, Services. submitted the following information suggestions, or need a copy of the (4) Affected public who will be asked collection request for review and proposed information collection or required to respond, as well as a brief clearance in accordance with the instrument with instructions, or abstract: Primary: Individuals or Paperwork Reduction Act of 1995. The additional information, please contact Households. This form will be used by proposed information collection is Richard A. Sloan 202–514–3291, permanent residents to file a declaration published to obtain comments from the Director, Regulations and Forms of intention to become a citizen of the public and affected agencies. Comments Services Division, U.S. Citizenship and United States. This collection is also are encouraged and will be accepted for Immigration Services, Department of used to satisfy documentary sixty days until January 27, 2004. Homeland Security, Room 4034, 425 I requirements for those seeking to work Written comments and suggestions Street, NW., Washington, DC 20536. in certain occupations or professions, or from the public and affected agencies Additionally, comments and/or to obtain various licenses. concerning the proposed collection of suggestions regarding the item(s) (5) An estimate of the total number of information should address one or more contained in this notice, especially respondents and the amount of time of the following four points: regarding the estimated public burden

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00049 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66845

and associated response time may also SUPPLEMENTARY INFORMATION: Section Dated: November 14, 2003. be directed to Mr. Richard A. Sloan. 102 of the Maritime Transportation Curtis A. Springer, If additional information is required Security Act (MTSA) of 2002 (Pub. L. Captain, Coast Guard, Captain of the Port, contact: Mr. Steve Cooper, PRA 107–295) added section 70112 to Title Baltimore, Maryland. Clearance Officer, Department of 46 of the U.S. Code, and authorizes the [FR Doc. 03–29651 Filed 11–26–03; 8:45 am] Homeland Security, Office of the Chief Secretary of the Department in which BILLING CODE 4910–15–P Information Officer, Regional Office the Coast Guard is operating to establish Building 3, 7th and D Streets, SW., Suite Area Maritime Security Advisory 4636–26, Washington, DC 20202. Committees (AMS Committees) for any DEPARTMENT OF HOMELAND Dated: November 21, 2003. port area of the United States. The SECURITY Richard A. Sloan, MTSA includes a provision exempting these AMS Committees from the Federal Coast Guard Department Clearance Officer, Department of Homeland Security, U.S. Citizenship and Advisory Committee Act (FACA), Pub. [USCG–2003–16546] Immigration Services. L. 92–436, 86 Stat. 470 (5 U.S.C. App. [FR Doc. 03–29706 Filed 11–26–03; 8:45 am] 2). The Coast Guard COTP Baltimore is Merchant Marine Personnel Advisory holding a public meeting, in order to Committee BILLING CODE 4410–10–M introduce the public to the purpose of and applications procedure for their AGENCY: Coast Guard, DHS. ACTION: Notice of meeting. DEPARTMENT OF HOMELAND AMS Committee. This meeting will serve as a general overview of the work SECURITY SUMMARY: The Merchant Marine that AMS Committee members will be Personnel Advisory Committee Coast Guard completing, as well as offer the public (MERPAC) will hold a working group the opportunity to ask questions [CGD05–03–184] meeting to discuss training regarding membership on the AMS requirements and certification for a Area Maritime Security Committee, Committee. vessel security officer. MERPAC agreed Captain of the Port Baltimore, Agenda of Meeting at its September 19, 2003, meeting to Maryland accept task statement number 44 on The agenda includes the following: security training and certification for AGENCY: Coast Guard, DHS. (1) General Welcome and vessel security officer and other vessel ACTION: Notice of meeting. Introduction. personnel. To facilitate the development SUMMARY: The Area Maritime Security (2) Review and Discussion of of any additional training requirements (AMS) Committee for the Captain of the Maritime Security Regulations. in support of the U.S. Coast Guard Port Baltimore, MD zone will meet to (3) General Committee Structure and Maritime Transportation Security discuss various issues relating to Processes. regulations and complete the task maritime security for the Captain of the (4) Review and Discussion Area statement, the working group will meet Port Baltimore zone. The meeting will Maritime Plan. to discuss both training requirements and certification of vessel security be open to the public. (5) Frequency of Area Maritime officers. This meeting will be open to DATES: The meeting will be held on Security meetings. the public. Thursday, December 18, 2003, from 1 (6) Open Forum. p.m. to 4 p.m. Comments and related DATES: The MERPAC working group material must reach the Coast Guard on Procedural will meet on Wednesday, , or before December 8, 2003. 2004, from 11 a.m. to 5 p.m. The The meeting is open to the public. meeting may adjourn early if all ADDRESSES: The meeting will be held at Please note that the meeting may close business is finished. the Maritime Institute of Technology early if all business is finished. At the ADDRESSES: and Graduate Studies (MITAGS), 5700 Captain of the Port’s discretion, The MERPAC working Hammonds Ferry Road, Linthicum members of the public may make oral group will meet in room 6319, U.S. Heights, MD. You may mail comments presentations during the meeting. If you Coast Guard Headquarters, 2100 Second and related material to Commander, would like to make an oral presentation Street, SW., Washington, DC. This U.S. Coast Guard Activities, 2401 at the meeting, please notify Petty notice and task statement number 44 are available on the Internet at http:// Hawkins Point Road, Baltimore, MD Officer Dawkins listed under FOR dms.dot.gov under docket number 21226–1791. Comments and materials FURTHER INFORMATION CONTACT no later received from the public, as well as than December 8, 2003. Written material USCG–2003–16546. documents indicated in this preamble as for distribution at the meeting should FOR FURTHER INFORMATION CONTACT: For being available in the docket, are part of reach the Coast Guard no later than questions on this notice, contact docket [CGD05–03–184] and are December 8, 2003. If you would like a Commander Brian J. Peter, Executive available for inspection of copying at copy of your material distributed at the Director of MERPAC, or Mr. Mark C. U.S. Coast Guard Activities, 2401 meeting, please submit 40 copies to the Gould, Assistant to the Director, Hawkins Point Road, Baltimore, MD, Coast Guard listed under ADDRESSES. telephone 202–267–6890, fax 202–267– 21226–1791. 4570, or e-mail Information on Services for Individuals FOR FURTHER INFORMATION CONTACT: [email protected]. With Disabilities Lieutenant Charles Bright at U.S. Coast SUPPLEMENTARY INFORMATION: Notice of Guard Activities Baltimore, telephone For information on facilities or this meeting is given under the Federal 410–576–2676 or Petty Officer Courtney services for individuals with disabilities Advisory Committee Act, 5 U.S.C. App. Dawkins, telephone 410–576–2616, of or to request special assistance at the 2. The Merchant Marine Personnel the Planning and Preparedness Division. meeting, contact the Maritime Institute Advisory Committee advises the Comments and related material may be of Technology and Graduate Studies Secretary of Homeland Security on faxed to 410–576–2553. (MITAGS) as soon as possible. matters relating to the training,

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00050 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66846 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

qualifications, licensing, certification, emergency approval is only valid for collection: No Agency Form Number. and fitness of seamen serving in the U.S. 180 days. ALL comments and/or File No. OMB–40. U.S. Immigration and merchant marine. questions pertaining to this pending Customs Enforcement. request for emergency approval MUST (4) Affected public who will be asked Procedural be directed to OMB, Office of or required to respond, as well as a brief The meeting is open to the public and Information and Regulatory Affairs, abstract: Primary: Individuals and we request your participation. Members Attention: Ms. Karen Lee, Department of Households. This information collection of the public who plan to attend should Homeland Security Desk Officer, 725– allows an alien to seek an exemption notify Mr. Mark Gould at 202–267–6890 17th Street, NW., Suite 10235, from the NSEERS registration so that he may notify building security Washington, DC 20503; 202–395–5806. requirements by submitting a letter to officials. Please note that the meeting During the first 60 days of this same the Department of Homeland Security may adjourn early if all business is period, a regular review of this containing specific information. finished. If you would like a copy of information collection is also being (5) An estimate of the total number of your material distributed to each undertaken. During the regular review respondents and the amount of time member of the subcommittee in advance period, the DHS requests written estimated for an average respondent to of the meeting, please submit 25 copies comments and suggestions from the respond: 5,800 responses at 30 minutes to the Executive Director no later than public and affected agencies concerning (.5 hours) per response. , 2003. this the information collection. (6) An estimate of the total public Comments are encouraged and will be burden (in hours) associated with the Information on Services for Individuals accepted until January 27, 2004. During collection: 2,900 annual burden hours. With Disabilities 60-day regular review, all comments If additional information is required For information on facilities or and suggestions, or questions regarding contact: Mr. Steve Cooper, PRA services for individuals with disabilities additional information, to include Clearance Officer, Department of or to request special assistance at the obtaining a copy of the information Homeland Security, Office of Chief meetings, contact the Assistant collection instrument with instructions, Information Officer, Regional Office Executive Director, listed above in FOR should be directed to Mr. Richard A. Building 3, 7th and D Streets, SW., Suite FURTHER INFORMATION CONTACT, as soon Sloan, 202–514–3291, Director, 4636–26, Washington, DC 20202. as possible. Regulations and Forms Services Dated: November 21, 2003. Dated: November 20, 2003. Division, Department of Homeland Richard A. Sloan, Security, Room 4034, 425 I Street, NW., Joseph J. Angelo, Department Clearance Officer, Department of Director of Standards, Marine Safety, Security Washington, DC 20536. Written Homeland Security, U.S. Citizenship and and Environmental Protection. comments and suggestions from the Immigration Services. [FR Doc. 03–29652 Filed 11–26–03; 8:45 am] public and affected agencies concerning [FR Doc. 03–29702 Filed 11–26–03; 8:45 am] the proposed collection of information BILLING CODE 4910–15–P should address one or more of the BILLING CODE 4410–10–M following four points: DEPARTMENT OF HOMELAND (1) Evaluate whether the proposed DEPARTMENT OF HOMELAND SECURITY collection of information is necessary SECURITY for the proper performance of the Immigration and Customs functions of the agency, including Immigration and Customs Enforcement whether the information will have Enforcement practical utility; Agency Information Collection (2) Evaluate the accuracy of the Agency Information Collection Activities: Comment Request agencies estimate of the burden of the Activities: Comment Request proposed collection of information, ACTION: Request OMB emergency including the validity of the ACTION: 60-day notice of information approval; exemption from NSEERS methodology and assumptions used; collection under review; nonimmigrant registration requirements (file no. OMB– (3) Enhance the quality, utility, and checkout letter; Form G–146. 40). clarity of the information to be collected; and The Department of Homeland The Department of Homeland (4) Minimize the burden of the Security (DSH) and the U.S. Security (DHS) and the U.S. collection of information on those who Immigration and Customs Enforcement Immigration and Customs Enforcement are to respond, including through the (ICE) has submitted the following (ICE) has submitted an emergency use of appropriate automated, information collection request for information collection request (ICR) electronic, mechanical, or other review and clearance in accordance utilizing emergency review procedures, technological collection techniques or with the Paperwork Reduction Act of to the Office of Management and Budget other forms of information technology, 1995. The proposed information (OMB) for review and clearance in e.g., permitting electronic submission of collection is published to obtain accordance with section responses. comments from the public and affected 1320.13(a)(1)(ii) and (a)(2)(iii) of the Overview of this information agencies. Comments are encouraged and Paperwork Reduction Act of 1995. The collection: will be accepted for sixty days until DHS has determined that it cannot (1) Type of Information Collection: January 27, 2004. reasonably comply with the normal New information collection. Written comments and suggestions clearance procedures under this part (2) Title of the Form/Collection: from the public and affected agencies because normal clearance procedures Exemption from NSEERS Registration concerning the proposed collection of are reasonably likely to prevent or Requirements. information should address one or more disrupt the collection of information. (3) Agency form number, if any, and of the following four points: Therefor, immediate OMB approval has the applicable component of the (1) Evaluate whether the proposed been requested. If granted, the Department of Justice sponsoring the collection of information is necessary

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00051 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66847

for the proper performance of the and associated response time may also forms and other available documents functions of the agency, including be directed to Mr. Richard A. Sloan. submitted to OMB may be obtained whether the information will have If additional information is required from Mr. Eddins or on HUD’s Web site practical utility; contact: Mr. Steve Cooper, PRA at http://www5.hud.gov:63001/po/i/ (2) Evaluate the accuracy of the Clearance Officer, Department of icbts/collectionsearch.cfm. agencies estimate of the burden of the Homeland Security, Office of the Chief SUPPLEMENTARY INFORMATION: The proposed collection of information, Information Officer, Regional Office including the validity of the Building 3, 7th and D Streets, SW., Suite Department has submitted the proposal methodology and assumptions used; 4636–26, Washington, DC 20202. for the collection of information, as (3) Enhance the quality, utility, and described below, to OMB for review, as Dated: November 21, 2003. required by the Paperwork Reduction clarity of the information to be Richard A. Sloan, collected; and Act (44 U.S.C. chapter 35). The notice Department Clearance Officer, Department of lists the following information: (1) The (4) Minimize the burden of the Homeland Security, U.S. Immigration and collection of information on those who title of the information collection Customs Enforcement. proposal; (2) the office of the agency to are to respond, including through the [FR Doc. 03–29703 Filed 11–26–03; 8:45 am] use of appropriate automated, collect the information; (3) the OMB BILLING CODE 4410–10–M electronic, mechanical, or other approval number, if applicable; (4) the technological collection techniques or description of the need for the other forms of information technology, information and its proposed use; (5) DEPARTMENT OF HOUSING AND e.g., permitting electronic submission of the agency form number, if applicable; URBAN DEVELOPMENT responses. (6) what members of the public will be Overview of this information [Docket No. FR–4815–N–93] affected by the proposal; (7) how collection: frequently information submissions will (1) Type of Information Collection: Notice of Submission of Proposed be required; (8) an estimate of the total Extension of currently approved Information Collection to OMB: Public number of hours needed to prepare the collection. Housing Financial Management information submission including number of respondents, frequency of (2) Title of the Form/Collection: Template response, and hours of response; (9) Nonimmigrant Checkout Letter. AGENCY: Office of the Chief Information whether the proposal is new, an (3) Agency form number, if any, and Officer, HUD. extension, reinstatement, or revision of the applicable component of the ACTION: Notice. an information collection requirement; Department of Homeland Security and (10) the name and telephone sponsoring the collection: Form G–146. SUMMARY: The proposed information number of an agency official familiar U.S. Immigration and Customs collection requirement described below with the proposal and of the OMB Desk Enforcement. has been submitted to the Office of Officer for the Department. (4) Affected public who will be asked Management and Budget (OMB) for or required to respond, as well as a brief review, as required by the Paperwork This notice also lists the following abstract: Primary: Individuals and Reduction Act. The Department is information: Households. This form is used in soliciting public comments on the Title of Proposal: Public Housing making inquiries of persons in the subject proposal. Financial Management Template. United States or abroad concerning the Public Housing Authorities are OMB Approval Number: 2535–0107. whereabouts of aliens, and to request required to submit financial information Form Numbers: None. departure information by the ICE when on an annual basis to HUD in initial investigation to locate the alien or accordance with the Uniform Financial Description of the Need for the verify his or her departure is Reporting Standards and the Public Information and Its Proposed Use: unsuccessful. Housing Assessment System. Public Housing Authorities are required (5) An estimate of the total number of DATES: Comments Due Date: December to submit financial information on an respondents and the amount of time 29, 2003. annual basis to HUD in accordance with estimated for an average respondent to the Uniform Financial Reporting ADDRESSES: Interested persons are respond: 20,000 responses at 10 minutes Standards and the Public Housing invited to submit comments regarding (.166) per response. Assessment System. this proposal. Comments should refer to (6) An estimate of the total public Respondents: Not-for-profit burden (in hours) associated with the the proposal by name and/or OMB approval number (2535–0107) and institutions; State, local or tribal collection: 3,320 annual burden hours. government. If you have additional comments, should be sent to: Lauren Wittenberg, suggestions, or need a copy of the OMB Desk Officer, Office of Frequency of Submission: Annually. proposed information collection Management and Budget, Room 10235, Reporting Burden: Number of instrument with instructions, or New Executive Office Building, respondents, 3,173; Average annual additional information, please contact Washington, DC 20503; Fax number responses per respondent, 1.88; Total (202) 395–6974; e-mail Richard A. Sloan, 202–514–3291, _ annual responses, 5,987; Average Director, Regulations and Forms Lauren [email protected]. burden per response, 5.41 hrs. Services Division, U.S. Citizenship and FOR FURTHER INFORMATION CONTACT: Total Estimated Burden Hours: Immigration Services, Department of Wayne Eddins, Reports Management 32,393. Homeland Security, Room 4034, 425 I Officer, AYO, Department of Housing Street, NW., Washington, DC 20536. and Urban Development, 451 Seventh Status: Extension of a currently Additionally, comments and/or Street, Southwest, Washington, DC approved collection. suggestions regarding the item(s) 20410; e-mail [email protected]; Authority: Section 3507 of the Paperwork contained in this notice, especially telephone (202) 708–2374. This is not a Reduction Act of 1995, 44 U.S.C. 35, as regarding the estimated public burden toll-free number. Copies of the proposed amended.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66848 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Dated: November 20, 2003. for the collection of information, as DEPARTMENT OF HOUSING AND Wayne Eddins, described below, to OMB for review, as URBAN DEVELOPMENT Departmental Reports Management Officer, required by the Paperwork Reduction [Docket No. FR–4815–N–95] Office of the Chief Information Officer. Act (44 U.S.C. chapter 35). The notice [FR Doc. 03–29607 Filed 11–26–03; 8:45 am] lists the following information: (1) The Notice of Submission of Proposed BILLING CODE 4210–72–P title of the information collection Information Collection to OMB: proposal; (2) the office of the agency to Research on Socioeconomic Changes collect the information; (3) the OMB in cities DEPARTMENT OF HOUSING AND approval number, if applicable; (4) the URBAN DEVELOPMENT description of the need for the AGENCY: Office of the Chief Information Officer, HUD. [Docket No. FR–4815–N–94] information and its proposed use; (5) the agency form number, if applicable; ACTION: Notice. Notice of Submission of Proposed (6) what members of the public will be SUMMARY: The proposed information Information Collection to OMB: affected by the proposal; (7) how collection requirement described below General Conditions of the frequently information submissions will has been submitted to the Office of Construction Contract: Public Housing be required; (8) an estimate of the total Management and Budget (OMB) for Programs (Development and number of hours needed to prepare the review, as required by the Paperwork Modernization) information submission including number of respondents, frequency of Reduction Act. The Department is AGENCY: Office of the Chief Information response, and hours of response; (9) soliciting public comments on the Officer, HUD. whether the proposal is new, an subject proposal. Identifying the social, economic, ACTION: Notice. extension, reinstatement, or revision of demographic, and fiscal change an information collection requirement; SUMMARY: The proposed information occurring in American cities is an and (10) the name and telephone collection requirement described below important part of HUD’s mission. number of an agency official familiar has been submitted to the Office of Empirical research on urban dynamics with the proposal and of the OMB Desk Management and Budget (OMB) for will provide an understanding of what Officer for the Department. review, as required by the Paperwork factors are driving change and the This notice also lists the following Reduction Act. The Department is impact of public policy on change. information: soliciting public comments on the DATES: Comments Due Date: December Title of Proposal: General Conditions subject proposal. 26, 2003. The General Conditions provide of the Construction Contract: Public Housing Programs (Development and ADDRESSES: Interested persons are PHAs, contractors and subcontractors invited to submit comments regarding performance and compliance Modernization). OMB Approval Number: 2577–0094. this proposal. Comments should refer to requirements for project construction the proposal by name and/or OMB Form Numbers: HUD–5370. under the conventional bid method and approval number (2528–0227) and Description of the Need for the modernization. PHAs include this should be sent to: Lauren Wittenberg, Information and its Proposed Use: The contract document in with the project OMB Desk Officer, Office of General Conditions provide PHAs, specifications. Management and Budget, Room 10235, contractors and subcontractors DATES: Comments Due Date: December New Executive Office Building, performance and compliance 29, 2003. Washington, DC 20503; Fax number requirement for project construction ADDRESSES: Interested persons are (202) 395–6974; e-mail under the conventional bid method and invited to submit comments regarding [email protected]. modernization. PHAs include this this proposal. Comments should refer to contract document in with the project FOR FURTHER INFORMATION CONTACT: the proposal by name and/or OMB specifications. Wayne Eddins, Reports Management approval number (2577–0094) and Officer, AYO, Department of Housing should be sent to: Lauren Wittenberg, Respondents: Local or tribal government. and Urban Development, 451 Seventh OMB Desk Officer, Office of Street, Southwest, Washington, DC Management and Budget, Room 10235, Frequency of Submission: On _ occasion. 20410; e-mail Wayne [email protected]; New Executive Office Building, telephone (202) 708–2374. This is not a Washington, DC 20503; Fax number Reporting Burden: Number of respondents, 2,694; Average annual toll-free number. Copies of the proposed (202) 395–6974; e-mail forms and other available documents [email protected]. responses per respondent, 1; Total annual responses, 2,694; Average submitted to OMB may be obtained FOR FURTHER INFORMATION CONTACT: burden per response, 1 hrs. from Mr. Eddins or on HUD’s Web site Wayne Eddins, Reports Management at http://www5.hud.gov:63001/po/i/ Total Estimated Burden Hours: 2,694. Officer, AYO, Department of Housing icbts/collectionsearch.cfm. Status: Extension of a currently and Urban Development, 451 Seventh approved collection. SUPPLEMENTARY INFORMATION: The Street, Southwest, Washington, DC Department has submitted the proposal 20410; e-mail [email protected]; Authority: Section 3507 of the Paperwork for the collection of information, as telephone (202) 708–2374. This is not a Reduction Act of 1995, 44 U.S.C. 35, as described below, to OMB for review, as amended. toll-free number. Copies of the proposed required by the Paperwork Reduction forms and other available documents Dated: November 21, 2003. Act (44 U.S.C. chapter 35). The notice submitted to OMB may be obtained Donna Eden, lists the following information: (1) The from Mr. Eddins or on HUD’s Web site Director, Office of the Chief Information title of the information collection at http://www5.hud.gov:63001/po/i/ Officer, Office of Investment, Strategy, Policy, proposal; (2) the office of the agency to icbts/collectionsearch.cfm. and Management. collect the information; (3) the OMB SUPPLEMENTARY INFORMATION: The [FR Doc. 03–29608 Filed 11–26–03; 8:45 am] approval number, if applicable; (4) the Department has submitted the proposal BILLING CODE 4210–72–P description of the need for the

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66849

information and its proposed use; (5) DEPARTMENT OF HOUSING AND After October 17, 1988, OMB Control the agency form number, if applicable; URBAN DEVELOPMENT Number 1076–0158, for review and renewal by the Desk Officer for the (6) what members of the public will be [Docket No. FR–4809–N–48] affected by the proposal; (7) how Department of the Interior, Office of frequently information submissions will Federal Property Suitable as Facilities Management and Budget. be required; (8) an estimate of the total To Assist the Homeless DATES: Submit comments or suggestions number of hours needed to prepare the on or before December 29, 2003, to be information submission including AGENCY: Office of the Assistant assured of consideration. number of respondents, frequency of Secretary for Community Planning and ADDRESSES: Comments should be sent to Development, HUD. response, and hours of response; (9) the Attention: Desk Officer for the whether the proposal is new, an ACTION: Notice. Department of the Interior. You may submit comments on the information by extension, reinstatement, or revision of SUMMARY: This Notice identifies an information collection requirement; facsimile at (202) 395–6566 or you may unutilized, underutilized, excess, and send an e-mail to: OIRA_DOCKET@ and (10) the name and telephone surplus Federal property reviewed by number of an agency official familiar omb.eop.gov. HUD for suitability for possible use to Please send copy of comments to: with the proposal and of the OMB Desk assist the homeless. George Skibine, Office of Indian Gaming Officer for the Department. EFFECTIVE DATE: November 28, 2003. Management, Mail Stop 4543–MIB, This notice also lists the following FOR FURTHER INFORMATION CONTACT: 1849 C Street NW., Washington, DC information: Mark Johnston, Department of Housing 20240, facsimile at (202) 273–3153. Title of Proposal: Research on and Urban Development, Room 7262, FOR FURTHER INFORMATION CONTACT: You Socioeconomic Changes in Cities. 451 Seventh Street, SW., Washington, may request further information or DC 20410; telephone (202) 708–1234; obtain copies of the information OMB Approval Number: 2528–0227. TTY number for the hearing- and collection request submission from Form Numbers: HUD–424, HUD–424– speech-impaired (202) 708–2565, (these George Skibine at 202–219–4066. B, HUD–424CB, HUD–424CBW, SF LLL, telephone numbers are not toll-free), or SUPPLEMENTARY INFORMATION: The HUD–2880, HUD–2993, HUD–2994. call the toll-free title V information line collection of information will ensure Description of the Need for the at 1–800–927–7588. that the provisions of IGRA, the relevant Information and Its Proposed Use: SUPPLEMENTARY INFORMATION: In provisions of Federal law and the trust Identifying the social, economics, accordance with the December 12, 1988, obligations of the United States are met demographic, and fiscal change court order in National Coalition for the when federally recognized tribes seek a occurring in American cities ins an Homeless v. Veterans Administration, Secretarial determination that a gaming important part of HUD’s mission. No. 88–2503–OG (D.D.C.), HUD establishment would be in the best Empirical research on urban dynamics publishes a Notice, on a weekly basis, interest of the tribe and would not be detrimental to the surrounding will provide an understanding of what identifying unutilized, underutilized, excess and surplus Federal buildings community. Section 292.8 specifies the factors are driving change and the and real property that HUD has information collection requirement. An impact of public policy on change. reviewed for suitability for use to assist Indian tribe must ask the Secretary to Respondents: Not-for-profit the homeless. Today’s Notice is for the make a determination that a gaming institutions State, local or tribal purpose of announcing that no establishment would be in the best government. additional properties have been interest of the tribe and would not be Frequency of Submission: On determined suitable or unsuitable this detrimental to the surrounding occasion, Quarterly, Other Final. week. community. The information to be Dated: November 20, 2003. collected includes: name of the tribe, Reporting Burden: Number of tribal documents, description of the John D. Garrity, respondents, 120; Average annual land to be acquired, proof of ownership, responses per respondent, 1.5; Total Director, Office of Special Needs Assistance distance of land from the Indian tribe’s Programs. annual responses, 180; Average burden reservation or trust lands and other per response, 27.2 hrs. [FR Doc. 03–29514 Filed 11–26–03; 8:45 am] documents deemed necessary. Total Estimated Burden Hours: 4,910. BILLING CODE 4210–29–M Collection of this information is Status: Extension of a currently currently authorized under an approval by OMB (OMB Control Number 1076– approved collection. DEPARTMENT OF THE INTERIOR 0158). All information is collected when Authority: Section 3507 of the Paperwork the tribe submits a request for a Office of the Assistant Secretary— Reduction Act of 1995, 44 U.S.C. 35, as secretarial determination that a gaming Indian Affairs; Gaming on Trust Lands amended. establishment would be in the best Acquired After October 17, 1988 Dated: November 21, 2003. interest of the tribe and would not be Donna Eden, AGENCY: Office of Indian Gaming detrimental to the surrounding Management, Interior. community. Annual reporting and Director, Office of the Chief Information record keeping burden for this Officer, Office of Investment, Strategies, ACTION: Notice of submission of collection of information is estimated to Policy, and Management. information collection to the Office of Management and Budget. average 1000 hours each for [FR Doc. 03–29609 Filed 11–26–03; 8:45 am] approximately 2 respondents, including BILLING CODE 4210–72–P SUMMARY: As required by the Paperwork the time for reviewing instructions, Reduction Act of 1995, the Assistant researching existing data sources, Secretary—Indian Affair (AS–IA) is gathering and maintaining the data submitting the information collection needed, and completing and reviewing titled Gaming on Trust Lands Acquired the collection of information. Thus, the

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66850 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

total annual reporting and record Brief Description of collection: This is States, 600 E St., NW., Washington, DC keeping burden for this collection is a voluntary submission by respondents. 20579, telephone (202) 616–6975, FAX (202) estimated to be 2,000 hours. A request Type of review: Renewal. 616–6993. for comments on this information Respondents: Federally recognized Mauricio J. Tamargo, Indian tribes. collection request appeared in the Chairman. Federal Register on August 25, 2003 (68 Number of Respondents: 2. [FR Doc. 03–29707 Filed 11–26–03; 8:45 am] FR 51030). No comments have been Estimated Time per Response: 1000 received. hours. BILLING CODE 4310–93–P Request for Comments: The Bureau of Frequency of Response: One time only. Indian Affairs requests you to send your DEPARTMENT OF THE INTERIOR comments on this collection to the two Total Annual Burden to Respondents: 2000 hours. locations listed in the ADDRESSES Fish and Wildlife Service section. Your comments should address: Dated: November 6, 2003. (a) The necessity of this information Aurene M. Martin, Issuance of Permits collection for the proper performance of Principal Deputy Assistant Secretary—Indian the functions of the agency, including Affairs. AGENCY: Fish and Wildlife Service, whether the information will have [FR Doc. 03–29715 Filed 11–26–03; 8:45 am] Interior. practical utility; (b) the accuracy of the BILLING CODE 4310–4N–P ACTION: Notice of issuance of permits for agency’s estimate of the burden (hours endangered species and/or marine and cost) of the collection of mammals. information, including the validity of DEPARTMENT OF THE INTERIOR the methodology and assumptions used; SUMMARY: The following permits were (c) ways we could enhance the quality, Office of the Secretary issued. utility and clarity of the information to [GWCRC Meeting Notice No. 3–03] be collected; and (d) ways we could ADDRESSES: Documents and other minimize the burden of the collection of Guam War Claims Review Commission information submitted with these the information on the respondents, applications are available for review, such as through the use of automated The Guam War Claims Review subject to the requirements of the collection techniques or other forms of Commission, pursuant to section 10 of Privacy Act and Freedom of Information information technology. the Federal Advisory Committee Act (5 Act, by any party who submits a written Please note that an agency may not U.S.C. App. 10) and the Government in request for a copy of such documents to: sponsor or request, and an individual the Sunshine Act (5 U.S.C. 552b), U.S. Fish and Wildlife Service, Division need not respond to, a collection of hereby gives notice in regard to the of Management Authority, 4401 North information unless it has a valid OMB scheduling of meetings for the Fairfax Drive, Room 700, Arlington, Control Number. transaction of Commission business, as Virginia 22203; fax (703) 358–2281. It is our policy to make all comments follows: FOR FURTHER INFORMATION CONTACT: available to the public for review at the Date and Time: Monday, December 8, location listed in the ADDRESSES section, 2003, 8 a.m.–2 p.m., and Tuesday, December Division of Management Authority, room 4543, during the hours of 9 a.m. 9, 2003, 8 a.m.–6 p.m. (local time). telephone (703) 358–2104. to 4 p.m., EST Monday through Friday Place: Guam Legislature Building, 155 SUPPLEMENTARY INFORMATION: Notice is except for legal holidays. If you wish to Hesler Place, Hagatna, Guam 96910. hereby given that on the dates below, as have your name and/or address Subject Matter: Public hearings to take authorized by the provisions of the withheld, you must state this testimony of witnesses who survived the Japanese taking and occupation of Guam Endangered Species Act of 1973, as prominently at the beginning of your amended (16 U.S.C. 1531, et seq.), and/ comments. We will honor your request between 1941 and 1944. Status: Open. or the Marine Mammal Protection Act of according to the requirements of the Witnesses will be selected from among the 1972, as amended (16 U.S.C. 1361 et law. All comments from organizations residents of Guam who have completed seq.), the Fish and Wildlife Service or representatives will be available for questionnaires describing their experiences issued the requested permits subject to review. We may withhold comments during the World War II Japanese occupation certain conditions set forth therein. For from review for other reasons. of Guam. Members of the public interested in each permit for an endangered species, OMB has up to 60 days to make a observing the meeting may do so either in the Service found that (1) the person, as space permits, or via live decision on the submission for renewal, application was filed in good faith, (2) but may make the decision after 30 television broadcast. Requests for information concerning the hearings should the granted permit would not operate to days. Therefore, to receive the best the disadvantage of the endangered consideration of your comments, you be addressed either to the Commission’s local office, located in Building 15, Chamorro species, and (3) the granted permit should submit them closer to 30 days Village, 153 West Marine Drive, Hagatna, would be consistent with the purposes than 60 days. Guam 96910, telephone (671) 479–1941 or and policy set forth in section 2 of the OMB Approval Number: 1076–0158. (671) 479–1942, FAX (671) 479–1943, or to Endangered Species Act of 1973, as Title: Gaming on Trust Lands David Bradley, Executive Director, Guam amended. Acquired After October 17, 1988, 25 War Claims Review Commission, c/o Foreign CFR 292. Claims Settlement Commission of the United Endangered Species

Permit issuance Permit No. Applicant Receipt of application Federal Register notice date

059244 ...... New York State Museum ...... 68 FR 25620; May 13, 2003 ...... Sept. 3, 2003. 067574 ...... Omaha’s Henry Doorly Zoo ...... 68 FR 33179; , 2003 ...... Sept. 17, 2003. 072747 ...... Yale University ...... 68 FR 50804; August 22, 2003 ...... Nov. 12, 2003.

VerDate jul<14>2003 20:17 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66851

Marine Mammals

Permit issuance Permit No. Applicant Receipt of application Federal Register notice date

075014 ...... Norman L. Delan, Jr...... 68 FR 55989; Sept. 29, 2003 ...... Nov. 4, 2003.

Dated: November 14, 2003. male bontebok (Damaliscus pygargus appropriate. The holding of such a Michael S. Moore, dorcas) culled from a captive herd hearing is at the discretion of the Senior Permit Biologist, Branch of Permits, maintained under the management Director. Division of Management Authority. program of the Republic of South Africa, PRT–079622 [FR Doc. 03–29716 Filed 11–26–03; 8:45 am] for the purpose of enhancement of the BILLING CODE 4310–55–P survival of the species. Applicant: Christopher M. Bieniek, Hannibal, MO PRT–079370 The applicant requests a permit to DEPARTMENT OF THE INTERIOR Applicant: James F. Swidryk, Jersey import a polar bear (Ursus maritimus) City, NJ sport hunted from the Southern Fish and Wildlife Service The applicant requests a permit to Beaufort Sea polar bear population in import the sport-hunted trophy of one Canada for personal use. Receipt of Applications for Permit male bontebok (Damaliscus pygargus Dated: November 14, 2003. AGENCY: Fish and Wildlife Service, dorcas) culled from a captive herd Michael S. Moore, maintained under the management Interior. Senior Permit Biologist, Branch of Permits, ACTION: Notice of receipt of applications program of the Republic of South Africa, Division of Management Authority. for the purpose of enhancement of the for permit. [FR Doc. 03–29717 Filed 11–26–03; 8:45 am] survival of the species. SUMMARY: The public is invited to BILLING CODE 4310–55–P comment on the following applications PRT–079716 to conduct certain activities with Applicant: David F. Chadwick, Bartlett, endangered species and/or marine TN, PRT–079716 INTERNATIONAL TRADE mammals. The applicant requests a permit to COMMISSION DATES: Written data, comments or import the sport-hunted trophy of one [Investigations Nos. 701–TA–437 and 731– requests must be received by December male bontebok (Damaliscus pygargus TA–1060 and 1061 (Preliminary)] 29, 2003. dorcas) culled from a captive herd ADDRESSES: Documents and other maintained under the management Carbazole Violet Pigment 23 From information submitted with these program of the Republic of South Africa, China and India for the purpose of enhancement of the applications are available for review, AGENCY: United States International survival of the species. subject to the requirements of the Trade Commission. Privacy Act and Freedom of Information PRT–078687 ACTION: Institution of antidumping Act, by any party who submits a written investigations and scheduling of request for a copy of such documents Applicant: Department of Natural & preliminary phase investigations. within 30 days of the date of publication Environmental Resources of Puerto Rico, San Juan, PR of this notice to: U.S. Fish and Wildlife SUMMARY: The Commission hereby gives Service, Division of Management The applicant requests a permit to notice of the institution of investigations Authority, 4401 North Fairfax Drive, export biological samples obtained from and commencement of preliminary Room 700, Arlington, Virginia 22203; non-viable eggs and/or non-surviving phase antidumping investigations No. fax (703) 358–2281. hatchlings of hawksbill sea turtle 701–TA–437 and 731–TA–1060 and FOR FURTHER INFORMATION CONTACT: (Eretmochelys imbricata) collected from 1061 (Preliminary) under section 703(a) Division of Management Authority, the wild, for the purpose of diagnostic of the Tariff Act of 1930 (19 U.S.C. telephone (703) 358–2104. and scientific research. This notification 1671b(a)) (the Act) and 733(a) of the Act SUPPLEMENTARY INFORMATION: covers activities to be conducted by the (19 U.S.C. 1673b(a)) to determine applicant over a five-year period. Endangered Species whether there is a reasonable indication Marine Mammals that an industry in the United States is The public is invited to comment on materially injured or threatened with The public is invited to comment on the following applications for a permit material injury, or the establishment of the following application for a permit to to conduct certain activities with an industry in the United States is conduct certain activities with marine endangered species. This notice is materially retarded, by reason of mammals. The application was provided pursuant to section 10(c) of imports from China and India of submitted to satisfy requirements of the the Endangered Species Act of 1973, as carbazole violet pigment 23,1 provided amended (16 U.S.C. 1531, et seq.). Marine Mammal Protection Act of 1972, as amended (16 U.S.C. 1361 et seq.), Written data, comments, or requests for 1 The merchandise covered by these copies of these complete applications and the regulations governing marine investigations is carbazole violet pigment 23, should be submitted to the Director mammals (50 CFR part 18). Written identified as Color Index No. 51319 and Chemical Abstract No. 6358–30–1, with the chemical name of (address above). data, comments, or requests for copies ′ ′ of the complete applications or requests diindolo [3,2-b:3 ,2 -m]triphenodioxazine, 8,18- PRT–078237 dichloro-5,15-diethyl-5,15-dihydro-, and molecular for a public hearing on these formula of C34H22C12N4O2. The subject merchandise Applicant: Thomas L. Engleby, Castle applications should be submitted to the includes the crude pigment in any form (e.g., dry Rock, CO powder, paste, wet cake) and finished pigment in Director (address above). Anyone the form of presscake and dry color. Pigment The applicant requests a permit to requesting a hearing should give dispersions in any form (e.g., pigments dispersed in import the sport-hunted trophy of one specific reasons why a hearing would be Continued

VerDate jul<14>2003 19:59 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66852 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

for in subheading 3204.17.90 of the Commission antidumping (19 CFR 201.18) (see Handbook for Harmonized Tariff Schedule of the investigations. The Secretary will Electronic Filing Procedures, ftp:// United States, that are alleged to be prepare a public service list containing ftp.usitc.gov/pub/reports/ subsidized by the Government of India the names and addresses of all persons, electronic_filing_handbook.pdf). and alleged to be sold in the United or their representatives, who are parties In accordance with sections 201.16(c) States at less than fair value. Unless the to these investigations upon the and 207.3 of the rules, each document Department of Commerce extends the expiration of the period for filing entries filed by a party to the investigations time for initiation pursuant to section of appearance. must be served on all other parties to 732(c)(1)(B) of the Act (19 U.S.C. Limited disclosure of business the investigations (as identified by 1673a(c)(1)(B)), the Commission must proprietary information (BPI) under an either the public or BPI service list), and reach a preliminary determination in administrative protective order (APO) a certificate of service must be timely antidumping investigations in 45 days, and BPI service list.—Pursuant to filed. The Secretary will not accept a or in this case by January 5, 2004. The section 207.7(a) of the Commission’s document for filing without a certificate Commission’s views are due at rules, the Secretary will make BPI of service. Commerce within five business days gathered in these investigations Authority: These investigations are being thereafter, or by January 12, 2004. available to authorized applicants conducted under authority of title VII of the For further information concerning representing interested parties (as Tariff Act of 1930; this notice is published the conduct of these investigations and defined in 19 U.S.C. 1677(9)) who are pursuant to section 207.12 of the rules of general application, consult the parties to the investigations under the Commission’s rules. Commission’s Rules of Practice and APO issued in the investigations, Issued: November 21, 2003. Procedure, part 201, subparts A through provided that the application is made By order of the Commission. not later than seven days after the E (19 CFR part 201), and part 207, Marilyn R. Abbott, subparts A and B (19 CFR part 207). publication of this notice in the Federal Register. A separate service list will be Secretary to the Commission. EFFECTIVE DATE: November 21, 2003. maintained by the Secretary for those [FR Doc. 03–29647 Filed 11–26–03; 8:45 am] FOR FURTHER INFORMATION CONTACT: parties authorized to receive BPI under BILLING CODE 7020–02–P Olympia Hand (202–205–3182), Office the APO. of Investigations, U.S. International Conference.—The Commission’s Trade Commission, 500 E Street, SW., Director of Operations has scheduled a INTERNATIONAL TRADE Washington, DC 20436. Hearing- conference in connection with these COMMISSION impaired persons can obtain investigations for 9:30 a.m. on December [Inv. No. 337–TA–489] information on this matter by contacting 12, 2003, at the U.S. International Trade the Commission’s TDD terminal on 202– Commission Building, 500 E Street, In the Matter of Certain Sildenafil or 205–1810. Persons with mobility SW., Washington, DC. Parties wishing to Any Pharmaceutically Acceptable Salt impairments who will need special participate in the conference should Thereof, Such as Sildenafil Citrate, and assistance in gaining access to the contact Olympia Hand (202–205–3182) Products Containing Same; Notice of Commission should contact the Office not later than , 2003, to Commission Decision Not To Review of the Secretary at 202–205–2000. arrange for their appearance. Parties in an Initial Determination Finding a General information concerning the support of the imposition of Violation of Section 337 and That the Commission may also be obtained by antidumping duties in these Domestic Industry Requirement Is Met; accessing its Internet server (http:// investigations and parties in opposition Schedule for Written Submissions on www.usitc.gov). The public record for to the imposition of such duties will Remedy, Public Interest, and Bonding these investigations may be viewed on each be collectively allocated one hour the Commission’s electronic docket within which to make an oral AGENCY: U.S. International Trade (EDIS) at http://edis.usitc.gov. presentation at the conference. A Commission. SUPPLEMENTARY INFORMATION: nonparty who has testimony that may ACTION: Notice. Background.—These investigations aid the Commission’s deliberations may SUMMARY: Notice is hereby given that request permission to present a short are being instituted in response to a the U.S. International Trade petition filed on November 21, 2003, by statement at the conference. Written submissions.—As provided in Commission has determined not to Nation Ford Chemical Co., Fort Mill, review an initial determination (‘‘ID’’) SC, and Sun Chemical Corp., Fort Lee, sections 201.8 and 207.15 of the Commission’s rules, any person may (Order No. 19) issued by the presiding NJ. administrative law judge (‘‘ALJ’’) Participation in the investigations and submit to the Commission on or before , 2003, a written brief finding a violation of section 337 and public service list.—Persons (other than that the domestic industry requirement petitioners) wishing to participate in the containing information and arguments pertinent to the subject matter of the has been met in the above-captioned investigations as parties must file an investigation. entry of appearance with the Secretary investigations. Parties may file written to the Commission, as provided in testimony in connection with their FOR FURTHER INFORMATION CONTACT: sections 201.11 and 207.10 of the presentation at the conference no later Wayne Herrington, Esq., Office of the Commission’s rules, not later than seven than three days before the conference. If General Counsel, U.S. International days after publication of this notice in briefs or written testimony contain BPI, Trade Commission, 500 E Street, SW., the Federal Register. Industrial users they must conform with the Washington, DC 20436, telephone 202– and (if the merchandise under requirements of sections 201.6, 207.3, 205–3090. Copies of all nonconfidential investigation is sold at the retail level) and 207.7 of the Commission’s rules. documents filed in connection with this representative consumer organizations The Commission’s rules do not investigation are or will be available for have the right to appear as parties in authorize filing of submissions with the inspection during official business Secretary by facsimile or electronic hours (8:45 a.m. to 5:15 p.m.) in the oleoresins, flammable solvents, water) are not means, except to the extent permitted by Office of the Secretary, U.S. included in these investigations. section 201.8 of the Commission’s rules International Trade Commission, 500 E

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00057 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66853

Street, SW., Washington, DC 20436, claims 1–5 of the ‘‘534 patent. He also approve or disapprove the telephone 202–205–2000. General found the domestic industry Commission’s action. During this information concerning the Commission requirement satisfied. As to remedy, the period, the subject articles would be may also be obtained by accessing its ALJ found that the legal framework for entitled to enter the United States under Internet server (http://www.usitc.gov). considering whether to issue a general bond, in an amount determined by the The public record for this investigation exclusion order in the circumstances of Commission and prescribed by the may be viewed on the Commission’s this case is section 337(g)(2), not section Secretary of the Treasury. The electronic docket (EDIS) at http:// 337(d)(2). He recommended the Commission is therefore interested in edis.usitc.gov. Hearing-impaired issuance of a general exclusion order, receiving submissions concerning the persons are advised that information on but did not recommend the issuance of amount of the bond that should be the matter can be obtained by contacting a cease and desist order against imposed. respondent Aabaaca. He also the Commission’s TDD terminal on 202– Written Submissions: The parties to recommended that the bond permitting 205–1810. the investigation, interested government temporary importation during the SUPPLEMENTARY INFORMATION: The agencies, and any other interested Presidential review period be set at 100 Commission instituted this investigation parties are encouraged to file written percent of entered value. No party on , 2003, based on a complaint submissions on remedy, the public petitioned for review of the ID. filed by Pfizer, Inc. (‘‘Pfizer’’) of New interest, and bonding. Such submissions York, New York. 68 FR 10749 (March 6, In connection with the final disposition of this investigation, the should address the , 2003, 2003). The complaint, as supplemented, Commission may (1) issue an order that recommended determination by the ALJ alleged violations of section 337 of the could result in the exclusion of the on remedy and bonding. Complainant Tariff Act of 1930 in the importation subject articles from entry into the and the Commission investigative into the United States, sale for United States, and/or issue one or more attorney are also requested to submit importation, and sale within the United cease and desist orders that could result proposed orders for the Commission’s States after importation of certain in respondents being required to cease consideration. The written submissions sildenafil or any pharmaceutically and desist from engaging in unfair acts and proposed orders must be filed no acceptable salt thereof, including in the importation and sale of such later than close of business on December sildenafil citrate, and products articles. Accordingly, the Commission is 12, 2003. Reply submissions, if any, containing same by reason of interested in receiving written must be filed no later than the close of infringement of claims 1–5 of Pfizer’s submissions that address the form of business on , 2003. No U.S. Patent No. 5,250,534 (‘‘the ‘‘534 remedy, if any, that should be ordered. further submissions on these issues will patent’’). If a party seeks exclusion of an article be permitted unless otherwise ordered Fifteen respondents were named in from entry into the United States for by the Commission. the Commission’s notice of purposes other than entry for Persons filing written submissions investigation. Of these, eleven were consumption, it should so indicate and must file with the Office of the Secretary found to be in default. Two other provide information establishing that the original document and 14 true respondents were never found to have activities involving other types of entry copies thereof on or before the deadlines been served with the complaint and either are adversely affecting it or likely stated above. Any person desiring to notice of investigation, and have not to do so. For background, see In the submit a document (or portion thereof) otherwise participated in the Matter of Certain Devices for Connecting to the Commission in confidence must investigation. Another respondent has Computers via Telephone Lines, Inv. request confidential treatment unless been terminated from the investigation No. 337–TA–360, USITC Pub. No. 2843 the information has already been on the basis of a settlement agreement. (December 1994) (Commission granted such treatment during the One respondent is the subject of a Opinion). The Commission considers proceedings. All such requests should motion to terminate the investigation on the question of remedy to include the be directed to the Secretary of the the basis of a consent order, which the ALJ’s finding that the legal framework Commission and must include a full ALJ has granted and which is currently for considering whether to issue a statement of the reasons why the before the Commission. general exclusion order in the Commission should grant such On October 6, 2003, Pfizer filed a circumstances of this case is section treatment. See section 201.6 of the motion pursuant to Commission rule 337(g)(2), not section 337(d)(2). Commission’s Rules of Practice and 210.18 (19 CFR 210.18) for summary If the Commission contemplates some Procedure, 19 CFR 201.6. Documents for determination on the issues of the form of remedy, it must consider the which confidential treatment by the existence of a domestic industry and effects of that remedy upon the public Commission is sought will be treated violation of section 337. Pfizer’s motion interest. The factors the Commission accordingly. All nonconfidential written sought a general exclusion order and a will consider in this investigation submissions will be available for public cease and desist order against include the effect that a remedial order inspection at the Office of the Secretary. respondent #1 Aabaaca Viagra LLC would have on (1) the public health and (‘‘Aabaaca’’). On October 16, 2003, the welfare, (2) competitive conditions in This action is taken under the Commission investigative attorney filed the U.S. economy, (3) U.S. production of authority of section 337 of the Tariff Act a response in support of Pfizer’s motion. articles that are like or directly of 1930, 19 U.S.C. 1337, and section No other responses to the motion were competitive with those that are subject 210.42 of the Commission’s Rules of filed. to investigation, and (4) U.S. consumers. Practice and Procedure, 19 CFR 210.42. On October 27, 2003, the ALJ issued The Commission is therefore interested Issued: November 24, 2003. the subject ID finding that Pfizer has in receiving written submissions that By order of the Commission. demonstrated that there is a violation of address the aforementioned public Marilyn R. Abbott, section 337 by reason of the defaulting interest factors in the context of this respondents’ importation and sale of investigation. Secretary. sildenafil, sildenafil salts, or sildenafil If the Commission orders some form [FR Doc. 03–29648 Filed 11–26–03; 8:45 am] products that infringe one or more of of remedy, the President has 60 days to BILLING CODE 7020–02–P

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66854 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

DEPARTMENT OF JUSTICE Constitution Avenue, NW., Washington, The 60-day period for public comments, DC 20001. (The United State’s during which two comments were Antitrust Division Certificate of Compliance with received as described below, expired on Provisions of the Antitrust Procedures , 2003.1 Response to Public Comments on the and Penalties Act will be made available Proposed Final Judgment in United at the same location shortly after they I. Background States v. Univision Communications are filed with the Court.) Copies of any As explained more fully in the Inc. of these materials may be obtained upon Complaint and CIS, this transaction request and payment of a copying fee. Pursuant to the Antitrust Procedures raised competitive concerns relating to and Penalties Act, 15 U.S.C. 16(b)–(h), J. Robert Kramer II, the sale of advertising time on Spanish- the United States hereby publishes the Director of Operations, Antitrust Division. language radio stations in several two public comments on the proposed geographic markets. HBC is the nation’s Final Judgment in United States v. In the United States District Court for largest Spanish-language radio Univision Communications Inc., Civil the District of Columbia broadcaster. Univision, the largest No. 1:03V00758, filed in the United Civil Action No. 1:03CV00758; Judge: Hon. Spanish-language media company in the States District Court for the District of Rosemary M. Collyer Colombia, together with the responses United States, owns a significant equity of the United States to the comments. United States of America, Plaintiff, v. interest, and possesses governance On , 2003, the United States Univision Communications Inc., and rights, in Entravision Communications filed a Complaint alleging that Hispanic Broadcasting Corporation, Corporation (‘‘Entravision’’), another Univision Communications Inc.’s Defendants, Response to Public Spanish-language media company that proposed acquisition of Hispanic Comments is HBC’s principal competitor in Broadcasting Corp. would substantially Pursuant to the requirements of the Spanish-language radio in many lessen competition in the sale of Antitrust Procedures and Penalties Act, markets. The Complaint alleges that, advertising time on Spanish-language 15 U.S.C. § 16(b)–(h) (‘‘Tunney Act’’), due to Univision’s substantial equity radio stations in many geographic the United States hereby responds to the interest and governance rights in markets, in violation of Section 7 of the public comments received regarding the Entravision, Univision’s proposed Clayton Act. The proposed Final proposed Final Judgment in this case. acquisition of HBC would substantially Judgment, filed at the same time as the After careful consideration of these lessen competition in provision of Complaint, requires Univision to comments, the United States continues Spanish-language radio advertising time exchange its Entravision shares for a to believe that the proposed Final to a significant number of advertisers in nonvoting equity interest, divest a Judgment will provide an effective and several geographic markets in the substantial portion of its ownership in appropriate remedy for the antitrust United States. Entravision, give up its seat on violation alleged in the Complaint. The The proposed Final Judgment, if Entravision’s Board of Directors, United States will move the Court for entered, would require Univision to eliminate certain rights Univision has to entry of the proposed Final Judgment reduce its equity interest in Entravision veto important Entravision actions, and after the public comments and this to 15 percent of the outstanding shares restrain certain conduct that would Response have been published in the interfere with the governance of Federal Register, pursuant to 15 U.S.C. within three years from the filing of the Entravision’s radio business. The 16(d). proposed decree and to 10 percent proposed Final Judgment particularly On March 26, 2003, the United States within six years of such filing. The requires Univision, presently owning filed the Complaint in this matter proposed decree would also require approximately thirty percent of alleging that the proposed acquisition of Univision to convert all of its Entravision, to divest down to fifteen- Hispanic Broadcasting Corporation Entravision equity into a nonvoting percent ownership within three years, (‘‘HBC’’) by Univision Communications, class of stock; to relinquish its right to and ten-percent ownership within six Inc. (‘‘Univision’’) would violate Section place directors on Entravision’s Board of years. Public comment was invited 7 of the Clayton Act, as amended, 15 Directors; to eliminate certain of within the statutory 60-day comment U.S.C. 18. Univision’s rights to veto important period. The public comments and the Simultaneously with the filing of the Entravision actions; and to refrain from repsonses of the United States thereto complaint, the United States filed a certain conduct that would interfere are hereby published in the Federal proposed Final Judgment and a with the governance of Entravision’s Register, and shortly thereafter these Stipulation signed by the United States radio business. documents will be attached to a and the defendants consenting to the Entry of the proposed Final Judgment Certificate of Compliance with entry of the proposed Final Judgment would terminate this action, except that Provisions of the Antitrust Procedures after compliance with the requirements the Court would retain jurisdiction to and Penalties Act and filed with the of the Tunney Act. Pursuant to those construe, modify, or enforce the Court, together with a motion urging the requirements, the United States filed a provisions of the proposed Final Court to enter the proposed Final Competitive Impact Statement (‘‘CIS’’) Judgment and to punish violations Judgment. Copies of the Complaint, the in this Court on May 7, 2003; published thereof. proposed Final Judgment, and the the proposed Final Judgment and CIS in Competitive Impact Statement are the Federal Register on , 2003; 1 On , 2003, the Federal currently available for inspection in and published a summary of the terms Communications Commission announced that it Room 200 of the Antitrust Division, of the proposed Final Judgment and CIS, granted Univision’s and HBC’s applications for Department of Justice, 325 Seventh together with directions for the transfer of control that were required in order for Street, NW., Washington, DC 20530 submission of written comments the transaction to proceed. See Memorandum Opinion and Order, FCC 03–218 (located at http:/ (telephone: 202–514–2481) and at the relating to the proposed Final Judgment, /hraunfoss.fcc.gov/edocs&_public/attachmatch/ Clerk’s Office, United States District in the Washington Post for seven days FCC–03–218A1.pdf.). Univision and HBC closed Court for the District of Columbia, 333 on , 2003, through May 29, 2003. their merger the same day.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66855

II. Legal Standard Governing the affected by a proposed antitrust decree IV. The United States’ Response to Court’s Public Interest Determination must be left, in the first instance, to the Specific Comments Upon the publication of the public discretion of the Attorney General’’ Because both comments raise the comments and this Response, the (citations omitted)). general issue of whether the effects of United States will have fully complied Moreover, the United States is the merger should be analyzed in light with the Tunney Act and will move the entitled to ‘‘due respect’’ concerning its of an ‘‘overall’’ Spanish-language media Court for entry of the proposed Final ‘‘prediction as to the effect of proposed market, the United States will first Judgment as being ‘‘in the public remedies, its perception of the market respond to that issue. It will then interest.’’ 15 U.S.C. 16(e). The Court, in structure, and its view of the nature of respond to the specific points AAI and making its public interest the case.’’ Archer-Daniels-Midland Co., SBS raised concerning whether the determination, should apply to 272 F. Supp. 2d at 6 (citing Microsoft, remedy addresses the competitive harm deferential standard and should 56 F.3d at 1461). raised in the Complaint. withhold its approval only under A. Allegations Not Raised in the limited conditions. Specifically, the III. Summary of Public Comments Compliant Are Irrelevant to Whether the Court should review the proposed Final The United States received comments Proposed Final Judgment Is in the Judgment in light of the violations from two entities, the American Public Interest charged in the complaint and ‘‘withhold Antitrust Institute (‘‘AAI,’’ comment approval only if any of the terms appear attached as Exhibit 1) and Spanish 1. SBS’s Proposed Market and Alleged ambiguous, if the enforcement Broadcasting System, Inc. (‘‘SBS,’’ Harm Are Extraneous to the Competitive mechanism is inadequate, if third comment attached as Exhibit 2). Issues Raised in the Complaint parties will be positively injured, or if The Complaint alleges that the the decree otherwise makes ‘a mockery AAI takes the position that the United States’ CIS fails to address and evaluate relevant market consists of the provision of judicial power.’’’ Mass. School of of advertising time on Spanish-language ‘‘the consequences of this merger in Law v. United States, 118 F.3d 776, 783 radio stations to the significant number conventional terms in an overall market (D.C. Cir. 1997) (quoting United States of advertisers that consider Spanish- consisting of Spanish-language media, v. Microsoft Corp., 56 F.3d 1448, 1462 language radio advertising to be a examining such traditional criteria as (D.C. Cir. 1995)). particularly effective advertising advertising effects [and] the consumer It is not proper during a Tunney Act medium. See Complaint ¶¶12–15. SBS, interest in diversity of sources of review ‘‘to reach beyond the complaint however, takes the position that the political and cultural information.’’ AAI to evaluate claims that the government complaint should have raised additional cmt. at 1. AAI also states that the United did not make and to inquire as to why allegations of harm based on purported States’ CIS fails to explain why the they were not made.’’ Microsoft, 56 F.3d effects in a combined Spanish-language proposed Final Judgment does not at 1459; see also United States v. radio and television market. SBS cmt. at require the elimination of all rights Archer-Daniels-Midland Co., 272 F. 1–2. Supp. 2d 1, 6–7 (D.D.C. 2003) (rejecting Univision currently possesses in The Complaint’s market definition argument that court should consider Entravision and the divestiture of all does not extend to the issues raised by effects in markets other than those stock Univision holds in Entravision. SBS, nor should it. The market raised in the complaint); United States AAI cmt. at 1 n.2. These points are definition analysis in the Complaint v. Pearson PLC, 55 F. Supp. 2d 43, 45 similar to SBS’s comments on these properly begins by examining how (D.D.C. 1999) (noting that a court should issues and are addressed below. advertisers individually negotiate not ‘‘base its public interest Additionally, AAI argues that the transactions with radio broadcasters determination on antitrust concerns in Division should have considered indicia such as Entravision and HBC. The markets other than those alleged in the of harm to non-price competition, such resulting price for advertising time government’s complaint’’). Because as quality and innovation. reflects the circumstances of these ‘‘[t]he court’s authority to review the SBS, a Spanish-language radio individual negotiations and the decree depends entirely on the company that competes in many preferences of each advertiser. The government’s exercising its markets with HBC and Entravision, Complaint’s market definition reflects prosecutorial discretion by bringing a states that the United States should have these individualized negotiations by case in the first place,’’2 it follows that alleged harm in its Complaint based on looking at the options available to ‘‘the court is only authorized to review purported effects of the transaction on a individual advertisers. The Complaint the decree itself,’’ and not to ‘‘effectively ‘‘Spanish-language broadcasting alleges that a significant number of redraft the complaint’’ to inquire into market.’’ SBS cmt. at 1–2. SBS further advertisers exist who do not have other matters the United States might claims that the transaction will increase reasonable alternatives to advertising on have but did not pursue. Microsoft, 56 Univision’s incentives (1) to refuse to F.3d at 1459–60; see also United States Spanish-language radio; in other words, deal with or discriminate against v. Western Elec. Co., 993 F.2d 1572, these advertisers cannot effectively Spanish-language radio competitors 1577 (DC Cir. 1993) (noting that a switch to other media in the face of a who seek to advertise through Univision Tunney Act proceeding does not permit small but significant increase in the and (2) to force advertisers who wish to ‘‘de novo determination of facts and price of advertising time on Spanish- advertise through both radio and issues’’ because ‘‘[t]he balancing of language radio. This set of advertisers television to purchase time from both competing social and political interests forms the relevant market alleged in the Univision and HBC. Id. at 3. In addition, Complaint. SBS argues that the United States’ SBS does not appear to take issue 2 It is the United States’ responsibility to investigate a transaction and decide what remedy fails to solve the competitive with the theoretical framework allegations to raise in any challenge it may bring. concerns in the Spanish-language radio underlying the Complaint’s market See Heckler v. Chaney, 470 U.S. 821, 831–32 (1985) markets raised in the Complaint definition. Rather, it alleges that there is (‘‘[A]n agency’s decision not to prosecute or enforce, whether through civil or criminal process, because, according to SBS, Univision another market to consider; namely, a is generally committed to an agency’s absolute will be able to exercise undue influence purported market consisting of a set of discretion.’’). over Entravision. Id. at 1, 4–6. advertisers that are dependent on

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66856 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Spanish-language television and radio. Corp., 215 F. Supp. 2d 1, 14–15 (D.D.C. of a wide range of advertisers and The Complaint, however, makes no 2002) (describing legislative history review of over a million pages of such factual allegation. The proposed relating to CIS) (quoting 119 Cong. Rec. documents provided by the defendants market differs significantly from the one at 3452 (1973) (statement of Senator and other entities. In the end, the alleged in the Complaint and would Tunney)). To that end, the Tunney Act evidence did not support the claims require markedly different supporting provides that the CIS shall ‘‘recite’’ the proffered by the comments. facts to be justified. Moreover, market following: a. The evidence did not justify a definition is but one step toward the (1) The nature and purpose of the combined media market for advertisers. ultimate goal of determining proceeding; The United States has traditionally competitive effects. The Complaint (2) A description of the practices or treated radio and television as separate alleges that the transaction would likely events giving rise to the alleged antitrust markets. Past investigations cause anticompetitive effects with violation of the antitrust laws; involving general-market (English- regard to Spanish-language radio (3) An explanation of the proposal for language) media mergers revealed that (Complaint ¶¶ 24–27); it makes no such a consent judgment, including an few advertisers consider the two media allegations regarding a combined explanation of any unusual to be close substitutes; rather, most television and radio market. So, SBS circumstances giving rise to such advertisers viewed the two media as asks not only that the court redraft the proposal or any provision contained separate or complementary products complaint to include an additional therein, relief to be obtained thereby, given the qualitative differences market but also that the court impose a and the anticipated effects on between the two media.3 In examining competitive effects analysis based on competition of such relief; whether this ‘‘separate market’’ that new market to find cognizable (4) The remedies available to potential conclusion applied in this transaction, harm. private plaintiffs damages by the alleged the United States recognized that As discussed above, the United States violation in the event that such proposal Univision has a strong presence in is entitled to deference as to the case it for the consent judgment is entered in Spanish-language television and that, in brings, and, as Microsoft makes clear, it such proceeding; certain geographic markets, there are a is not proper during a Tunney Act (5) A description of the procedures limited number of other Spanish- review ‘‘to each beyond the complaint available for modification of such language television stations with ratings to evaluate claims that the government proposal; and that would be attractive to advertisers (6) A description and evaluation of did not make and to inquire as to why trying to reach Spanish-language alternatives to such proposal actually they were not made.’’ Microsoft, 56 F.3d viewers. Nevertheless, the evidence considered by the United States. at 1459. The Tunney Act does not garnered in this investigation showed authorize the Court to consider 15 U.S.C. 16(b). The United States’ CIS has satisfied all of these requirements. the same qualitative differences between allegations not raised in the Complaint television and radio that exist for based on concerns raised by a member More specifically, the CIS explains the nature and purpose of the proceeding (at general-market advertisers also exist for of the public. Accordingly, SBS’s Spanish-language advertisers. In the suggestion that the Complaint is 1–3), describes the events that gave rise to the alleged violation of the antitrust end, the investigation did not produce defective for failing to allege harm in a sufficient evidence to support the combined Spanish-language television law (at 3–9), explains the proposed Final Judgment (at 9–15), explains the proposition that a significant number of and radio market should be rejected as advertisers considered Spanish- a matter of law. remedies available to potential private litigants (at 15), explains the procedures language television and Spanish- The CIS Properly Addresses the Market available for modifying the proposed language radio to be sufficiently Effects Relevant to the Allegations in the Final Judgment (at 15–16), and interchangeable to support the Complaint ‘‘combined’’ market proposed by the describes and evaluates alternatives to 4 AAI takes the position that the United the proposed Final Judgment (at 16–17). comments. States has not satisfied its requirements There is simply no requirement that the b. The United States considered non under the Tunney Act because the CIS Government identify purported effects it price competition. AAI also argues that fails to identify the competitive effects did not allege in the Complaint or the United States should examine of the transaction in an ‘‘overall’’ explain why it did not make certain indicia of harm other than price, such Spanish-language media market and allegations in the Complaint. as quality and innovation. AAI cmt. at fails to justify the United States’ Accordingly, AAI’s challenge to the 4–5. The United States, in fact, decision not to challenge the transaction sufficiency of the CIS fails. considered such indicia during this based on those purported effects. This 3 position is not valid. Not only is the 3. The Government’s Investigation Did See, e.g., Complaint ¶¶ 11–14, United States v. Clear Channel Communications, No. 1:00CV02063 Court’s review limited to the case Not Demonstrate the Likelihood of Substantial Harm in an ‘‘Overall’’ (D.D.C. filed Aug. 29, 2000); Complaint ¶¶ 34–41, actually brought by the United States, United States v. Chancellor Media Company, Inc., there is no requirement that the United Spanish-Language Media Market No. CV–97–496 (E.D. N.Y. filed Nov. 6, 1997); States disclose its decision-making as to Although the United States has no Complaint ¶ 12, United States v. EZ Communications, Inc., No. 1:97CV00406 (D.D.C. cases it chooses not to initiate. Rather, legal obligation to address matters filed Feb. 27, 1997). the Tunney Act provides that the United raised in the Complaint, we note that 4 SBS’s submission does not provide a basis to States must inform the public about the the United States conducted an establish a combined Spanish-language television case it did initiate and explain how the extensive inquiry into the issue of and radio market. The letters that SBS attached to its comment as Exhibit A for the most part discuss proposed decree serves to resolve the whether the combination of Univision’s how certain advertisers depend on Spanish- competitive effects alleged in the Spanish-language television stations language media (a point with which the United Complaint. with HBC’s Spanish-language radio States does not disagree). Only two of the letters, The purpose of a CIS is to provide the stations in geographic regions where however, discuss the interchangeability of Spanish- language television and radio (, 2003 letter public with ‘‘basic data about the both are located was likely to cause from Castor A. Fernandez; May 27, 2003 letter from decree’’ to allow for informed comment. significant anticompetitive effects. The Caballero TV & Cable sales); the rest are silent on See generally United States v. Microsoft inquiry included numerous interviews the issue.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66857

investigation. In this case, the market is audience ratings, as it is audience access aggressively against Entravision. SBS comprised of the competitive that is being sold to the advertisers. That cmt. at 1, 4–6.5 alternatives for certain advertisers competition benefits advertisers as Contrary to SBS’s assertions, the seeking to purchase commercial time on discussed above. It also benefits proposed Final Judgment will preserve Spanish-language radio stations. Market individual audience members (listeners competition between Entravision and participants compete on the basis of of radio stations) because stations will HBC by restricting Univision’s ability to both price and service (or ‘‘quality’’ or compete for their attention by offering control or influence Entravision’s radio ‘‘innovation’’). See, e.g., Complaint ¶ 14 high quality content. In this way, the business and by significantly reducing (relevant product market defined in relief in the Final Judgment that protects Univision’s equity stake in Entravision. terms of options available to certain advertising competition also serves to See CIS at 9–13 (describing specific advertisers facing ‘‘a small but protect individual audience members by means by which the proposed Final significant increase in the price of maintaining vigorous competition Judgment will preserve competition). advertising time on Spanish-language between the Spanish-language radio Addressing SBS’s first contention, as radio, or a reduction in the value of stations owned by Univision/HBC and stated in the CIS, Univision and services provided’’) (emphasis added). those owned by Entravision. Entravision have a long-standing As the Complaint and CIS state, d. The allegation that Univision may television relationship in which Entravision and HBC heavily promote refuse to deal with certain advertisers or Entravision broadcasts Univision their stations against each other in an impose tying arrangements does not programming on television stations effort to gain high ratings; they program warrant condemning the transaction. owned by Entravision. This relationship and format their stations in an effort to SBS alleges that the merger will provide is embodied in a pre-existing, long-term attract listeners away from each other; Univision an enhanced incentive to affiliation agreement that assigns rights they aggressively seek to acquire refuse to deal with or discriminate and responsibilities to both parties and stations; and they closely monitor each against Spanish-language radio also provides for Univision to act as other’s competitive positions. competitors who seek to advertise on Entravision’s national sales Complaint ¶ 19; CIS at 6. As explained Univision and will also provide representative for television advertising. in the CIS, the goal of the proposed Univision the ability to ‘‘tie’’ radio and In addition to the fact that this vertical Final Judgment is to protect such television advertising time for integration may yield certain vigorous price and nonprice advertisers who seek to use both efficiencies and consumer benefits, competition between Entravision and mediums. (SBS Cmt. at 3). The United there is nothing in this affiliation HBC by foreclosing the ability of a States did not find evidence upon agreement that allows Univision to combined Univision/HBC to improperly which to base a cause of action pursuant control any Entravision radio decision, influence Entravision’s strategic to SBS’s theory. If Univision engages in including decisions regarding the acquisition of radio stations. Moreover, decision making with regard to its radio the alleged conduct in the future, and if the decree itself mandates that the two business. See CIS at 9–11. Contrary to the conduct satisfies the requirements of companies act as independent entities AAI’s assumption, the United States an antitrust violation, then the United and there s no reason to believe that considered the many ways in which States (or a private plaintiff with Univision will violate the terms of the advertisers benefit from competition— standing) could challenge the conduct at decree (and thereby subject itself to not just price competition—in crafting that time. The mere speculation that Univision will violate the antitrust laws, contempt of court proceedings) by using its remedy. however, does not justify enjoining this its television relationship to influence c. The consideration of political and transaction. any Entravision strategic decision. The cultural viewpoints are extraneous to Division found no evidence to suggest antitrust enforcement. AAI also asserts B. SBS’s Assertions That the Proposed that the mere fact that a television that the United States should take into Final Judgment Will Not Remedy the affiliation agreement exists between account under its antitrust analysis Competitive Concerns Raised in the them enables Univision to unduly ‘‘consumer interest in diversity of Complaint Are Unfounded influence Entravision’s decisions with sources of political and cultural SBS asserts that the remedy will not respect to its radio business, the only information’’ within a combined address the competitive harms raised in area in which the combined Univision/ Spanish-language television and radio the Complaint because Univision will HBC will compete with Entravision. market. AAI cmt. at 1, 3–4. It is not the still have the ability to improperly Finally, Entravision has every incentive role of the United States to use the influence Entravision’s actions to the to operate its radio stations in a fully antitrust laws to regulate actual content detriment of radio competition between competitive manner. or to establish quotas for the types of Entravision and Univision/HBC. As to SBS’s second contention, programming that media stations must Specifically, SBS contends that (1) the although Univision will maintain a few broadcast. Accordingly, we do not seek existence of the television affiliation limited governance rights in Entravision to ensure in the context of a merger agreement between Univision and that it held prior to the contemplation review that media companies provide a Entravision will cause Entravision to of this merger, the proposed Final balance of political views or a proper mitigate its radio competition with a Judgment eliminates Univision’s ability mix of cultural issues as part of their combined Univision/HBC; (2) to exercise these rights over Entravision programming. The United States does Univision’s continued retention of radio decisions. The rights that are seek to ensure that content is limited shareholder ‘‘veto’’ rights in retained relate to the two entities’ determined in a competitive Entravision might foreclose television relationship, which is not a marketplace, however. The relevant competition-enhancing transactions; (3) basis of concern alleged in the product identified in the Complaint is the time period to complete the stock the provision of advertising time on divestitures called for in the proposed 5 As noted above, AAI asserts that the CIS fails Spanish-language radio stations; the Final Judgment is too long; and (4) to explain why Univision was not forced to relinquish all its shareholder ‘‘veto’’ rights in customer is an advertiser purchasing Univision’s ability to hold 10 percent of Entravision and to divest all its Entravision equity. that time. In order to supply this Entravision’s stock will cause AAI cmt. at 1 n.2. These points are addressed in product, media stations compete to gain Univision/HBC to compete less this response to SBS’s comments.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66858 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Complaint. Univision will retain a V. Conclusion Re: U.S. v. Univision Communications, Civ. Action No. 1:03CV00758 modified right to veto a merger or After careful consideration of these transfer of ownership of Entravision. public comments, the United States has Dear Mr. Wade: These constitute the Although this right does impact Tunney Act comments of the American concluded that entry of the Proposed Antitrust Institute (‘‘AAI’’) in regard to the ultimate ownership of Entravision, it Final Judgment will provide an effective cannot be used to veto or influence day- acquisition of Hispanic Broadcasting and appropriate remedy for the antitrust Corporation (‘‘HBC’’) by Univision to-day decisions relating to radio violation alleged in the Complaint and Communications Inc. (‘‘Univision’’).1 competition or strategic decisions such is, therefore, in the public interest. The Competitive Impact Statement (‘‘CIS’’) as the buying or selling of individual Pursuant to Section 16(d) of the Tunney in this case appears to reflect an unduly radio stations. Act, the United States is submitting narrow interpretation of the Clayton Act. We With respect to SBS’s third these public comments and this have only minor quarrels with the standard contention, while the United States Response to the Federal Register for analysis embodied in the CIS insofar as it traditionally requires defendants to identifies horizontal overlaps in the Spanish- publication. After these comments and language radio industry and seeks to divest business assets as expeditiously this Response are published in the as possible to maintain their value and eliminate these overlaps through Federal Register, the United States will 2 ongoing capabilities, the relief sought divestitures. Our principal concern is with move this Court to enter the Proposed what the CIS fails to address. It should here is for divestiture of stock, the Final Judgment. evaluate the consequences of this merger in retention of which does not raise the conventional terms in an overall market Dated this 31st day of October, 2003. same spoliation concerns as the consisting of Spanish-language media, retention of business assets raises. Respectfully submitted, examining such traditional criteria as Moreover, based on our investigation, lll/s/ll advertising effects. In addition, it should we concluded that a forced divestiture William H. Stallings, evaluate the consumer interest in diversity of of equity within a short amount of time Litigation III Section, Antitrust Division, sources of political and cultural information United States Department of Justice, 325 within this more general market. could cause material hardship to 7th Street, NW., Suite 300, Washington, DC Entravision’s vitality as a significant 20530. I. The CIS Ignores the Elephant in the Room competitor (for example, a ‘‘fire-sale’’ of The CIS states that HBC is the nation’s Univision’s stock holdings in Certificate of Service largest Spanish-language radio broadcaster Entravision could depress Entravision’s The undersigned certifies that a copy and that Univision is the largest Spanish- stock price to the point that it would not language media company in the U.S. of the foregoing Response to Public Univision is described as having two be able to issue equity to fund potential Comments was served on the following acquisitions). Such hardship should be Spanish-language broadcast networks, counsel, by electronic mail in PDF Univision and Telefutura, one cable channel, avoided or minimized if at all possible format, this 31st day of October, 2003: Galavision, and several other Spanish- so as to maintain Entravision as a strong John M. Taladay, Howerey, Simon, language media operations, including competitor to the unified Univision/ Arnold & White L.L.P., 1299 Internet sites and services, music recording, HBC. The time period relfects a Pennsylvania Avenue, NW., distribution, and publishing. Univision also balancing designed to minimize the Washington, DC 20004–2402; has a 30-percent equity share in Entravision, potential harms to competition that which owns or operates 55 mostly-Spanish Neil W. Imus, Vinson & Elkins L.L.P., might arise from a divestiture that radio stations and 49 television stations that The Willard Office Building, 1455 proceeds either too slowly or too broadcast Univision programming. We are Pennsylvania Avenue, NW., not informed of Univision’s market share in rapidly. Washington, DC 20004–1008; Spanish-language television. Finally, responding to SBS’s fourth HBC owns or operates more than 60 radio contention, under the circumstances of and on the following entities by facsimile and U.S. Mail, on this same stations, virtually all broadcasting in this case, Univision’s ability to hold no Spanish. We are not informed of HBC’s more than 10 percent of Entravision’s date: market share in Spanish-language radio. And, equity will not give it control or even Albert A. Foer, The American Antitrust of course, we are not informed of market significant influence over Entravision’s Institute, 219 Ellicott Street, NW., shares in any combined Spanish-language business decisions. The decree Washington, DC 20008, (202) 276– media market. significantly restrains Univision’s 6002 (phone), (202) 966–8711 The Complaint is limited to the provision ability to participate in Entravision’s (facsimile); of advertising time on Spanish-language Claudia R. Higgins, Counsel for Spanish radio stations to advertisers that consider governance. For example, Univision Spanish-language radio to be a particularly will not be allowed: To suggest or Broadcasting Systems, Kaye Scholer effective medium. This is the only product nominate any candidate for LLP, 901 15th Street, NW., Suite 1100, market deemed relevant. Six metropolitan Entravision’s board of directors; to have Washington, DC 20005, (202) 682– areas are designated as the relevant Univision employees serve as 3653 (phone), (202) 682–3580 geographic markets. Entravision employees; to participate in (facsimile). The ‘‘elephant in the room’’ whose any Entravision board of directors lll/s/llllllllllll presence has been mentioned in the CIS but meeting ; to vote its equity; and to have William H. Stallings given no antitrust importance, is television. access to any of Entravision’s We recognize that the Antitrust Division has June 12, 2003 traditionally treated radio and television as competitively sensitive information. See James R. Wade Final Judgment, Section VI. Moreover, Chief, Litigation III Section, Antitrust 1 The AAI is an independent 501(c)(3) research, Univision’s reduced equity stake in Division, United States Dept. of Justice, 325 education, and advocacy organization described at Entravision is not sufficiently large to 7th Street, N.W., Suite 300, Washington, www.antitrustinstitute.org. affect competition between them given DC 20530 2 For example, we are puzzled by the CIS’s failure the market structure of the relevant Ce: Chairman Michael Powell, Federal to explain why the Proposed Final Judgment does 6 not require elimination of all shareholder rights that geographic markets at issue. Communications Commission Univision currently possesses in Entravision and for failing to explain why it allows Univision to 6 Cf. Archer-Daniels-Midland, 272 F. Supp. 2d at that two companies operated as independent retain any stock in Entravision. If these are simply 8 (crediting the Government’s statement in Tunney competitors notwithstanding one company’s partial the best compromises the Division could get, why Act proceeding that factual investigation showed equity ownership in the other). not say so?

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66859

separate markets, in that there are so many the present merger does not involve III. Protecting the Public Interest Requires sources of information for English-speakers newspapers, one can not tell from the CIS Analysis of the Impact of This Acquisition that diversity of sources has not appeared to because the implications of putting the on Consumer Choice rise to an antitrust concern. But here we are leading Hispanic radio and TV stations under Based on what is said in the CIS, there is potentially face with a different situation. the same corporate control is not addressed. no evidence that the DOJ has considered Should television and radio directed at a In the section on Alternatives to the Proposed anything other than the probability of short- Spanish-speaking audience be deemed a Final Judgment, we are only told that the term price increases. Why no discussion of relevant market, not on the basis of Department considered a full trial on the such other traditional antitrust concerns as competition for advertising but on the basis merits and a proposal by the defendants for the effect on consumer choice? 5 There have of competition for the consumer’s attention? been many antitrust cases in which non-price Even though the merger, after the divestiture placing Entravision stock into a long-term factors were considered.6 As one example, in of overlap radio markets, will arguably not trust. United States v. Philadelphia National Bank, increase concentration in either the Having advised the public that the leading the Court expressed a concern with possible television or the radio market, will it reduce Spanish-language TV conglomerate was adverse effects of a bank merger on ‘‘price, in a significant way the diversity of sources acquiring the leading Spanish-language radio variety of credit arrangements, convenience of political and cultural information available company, the DOJ has the Tunney Act to the Spanish-speaking consumer? This also obligation to explain why it has made the of location, attractiveness of physical raises the question of the role of other aspects determination that this highly suggestive surroundings, credit information, investment of Spanish-language media, such as scenario is of no antitrust concern. The fact advice, service charges, personal accommodations, advertising, miscellaneous newspaper publishing and the Internet, that there are relevant antitrust markets for special and extra services* * *’’ 7 which are not discussed in the CIS. An Hispanic radio and Hispanic TV does not Theories of possible antitrust liability in appropriate larger Spanish-language market perclude the possibility that in certain First Amendment-related cases come from should be analyzed not only in traditional circumstances there may also be a larger many reputable sources. For example, Robert (advertising) terms but also in terms of relevant antitrust market, depending on what diversity of content sources.3 H. Lande and Neil W. Averitt have argued types of anticompetitive effects one is that consumer choice is no less a goal of II. The Hypothetical of the Dominating Voice concerned about. There is no inconsistency antitrust than competitive pricing.8 Maurice Consider the following hypothetical. There in being concerned both with advertising E. Stucke and Allen P. Grunes, two DOJ is a substantial group of Americans who only rates in radio markets and diversity of attorneys, have argued that it is proper to speak Spanish and whose sources of producers/editors of content in a more look beyond price effects to ‘‘the marketplace information are limited to Spanish-speaking general market for information or specifics of ideas’’ in order to consider non-price TV, Spanish-speaking radio, and Spanish- categories of information. dimensions of economic competition, such as speaking newspapers. A single corporation Let us be more precise about what diminished quality and choice.9 Joseph by acquisition gains control over all three information is lacking. Farrell, a former Chief Economist for the media. The head of that corporation would 1. What proportion of Spanish-speaking Antitrust Division, argued that price is be in the position to wield enormous consumers in the U.S. are completely or merely a synecdoche (a part representing the political and economic influence by highly dependent upon Spanish-language whole) for what we desire from competition determining what the Spanish-speaking sources of information? (Call this the ‘‘highly (i.e., innovation, quality, and price), and that community will know and believe. He or she dependent consumer market.’’) it does not always adequately represent the could determine what political candidates 2. What proportion of the highly package of desirables.10 Robert Pitofsky has will gain exposure to the Spanish-speaking dependent consumer market pre- and post- argued that non-economic political values electorate and whether that exposure will be merger depend on the merging parties as a such as the First Amendment can be relevant positive, negative, or neutral. Being able to principal source of information? and may justify a higher degree of scrutiny sway a substantial part of the Hispanic vote 11 3. What options apart from Univision and in certain cases. FTC Commissioner could determine the outcome of local, state, HBC are available to the highly dependent Thomas Leary has argued that diversity is an and national elections and the owner of this appropriate goal of antitrust.12 political power would be in position to make consumer market, pre- and post-merger? deals with a political party and with an 4. Using a variety of measures (e.g., 5 Although the Federal Communications Administration. The same corporation could advertising dollars, number of message recipients, contact hours), how substantial Commission has the opportunity to stop this merger dramatically influence within the Spanish- on ‘‘public interest’’ grounds, this possibility would speaking community which cultural trends, are these options in comparison to Univision not relieve the Department of Justice from fully products and services will be ignored, and HBC? What are the relevant market considering legitimate antitrust theories of denigrated or positively portrayed, thereby shares and HHI’s? competitive harm that coincidentally have the having a significant impact on the economy. We recognize that these are not easy benefit of protecting First Amendment values. This is the Hypothetical of a Dominating questions to answer, and that the answers 6 See Robert H. Lande, ‘‘Consumer Choice and Voice. will depend on the assumptions made about Antitrust,’’ 62 U. Pitt. L. Rev. 503, 508–512, and Are the assumptions of this hypothetical such matters as the definition of ‘highly cases cited therein. 7 far removed from the reality of the present dependent’. Nevertheless, with answers to 374 U.S. 363, 368 (1968). 8 acquisition?4 Aside from the distinction that these questions and explicitness about the ‘‘Consumer Sovereignty: A Unified Theory of Antitrust and Consumer Protection Law,’’ 65 assumptions used, one can begin to evaluate Antitrust L.J. 713, 715 (1997). 3 It is true that for much of radio and TV, the whether the Hypothesis of a Dominating 9 ‘‘Antitrust and the Marketplace of Ideas,’’ 69 consumer is not directly charged for consuming the Voice represents a realistic threat. Antitrust L.J. 249 at 297 (2001). product, although higher advertising costs may be 10 passed on to the consumer in product prices and ‘‘Thoughts on Antitrust and Innovation,’’ the consumer has opportunity costs that represent 15% do not speak the language well. Spanish is Speech to the National Economists Club, a kind of price to be paid for consumption. said to be the language most frequently spoken by Washington, DC (Jan. 25, 2001), at http:// Nonetheless, producers of, e.g., news, are in nearly 75% of adults in the top ten Hispanic www.usdoj.gov/atr/public/speeches/7402.pdf. competition with one another not only to gain metropolitan areas. If these figures are 11 Robert Pitofsky, The Political Content of advertisers, but to gain the consumer’s business. approximately correct, there appears to be reason to Antitrust, 127 U. PA. L. REV. 1051 (1979). Compare this with doctors who compete with one believe that at least a significant section of the 12 See Thomas B. Leary, ‘‘The Significance of another for their patient’s business, even though the Spanish-speaking community in the U.S. is highly Variety in Antitrust Analysis,’’ based on a speech medical bill may be paid by a third party. Would dependent on information it receives in Spanish delivered at the Steptoe & Johnson 2000 Antitrust not the importance of consumer choice in medical and that English is in these situations an inadequate Conference, on May 18, 2000, and available at http:/ care justify an antitrust case if the only two medical substitute. There are also studies demonstrating that /www.ftc.gov/speeches/leary/atljva4.htm: practices in a community were to merge, even if the commercial information conveyed in Spanish is far ‘‘It does not make sense to simply ignore the merger would be guaranteed by the doctors not to more persuasive to this group than information issue, however, because for many consumers affect the fees charged to health insurers? conveyed in English, even among those who are variety may be a more significant issue than price. 4 According to various sources, at least 9% of bilingual. Arguably, the same would be true of Consider the example of two chains of bookstores Hispanics do not speak English at all, and at least political information. Continued

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00064 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66860 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

We are told in the CIS that the Court may perceptions of political influence, it is and television are good substitutes.1 From only review the remedy in relation to the essential that the Tunney Act’s public the perspective of these advertisers, an HBC/ violations that the U.S. has alleged in its interest oversight be fully informed, with all Univision combination is effectively a merger Complaint. It might be argued that the DOJ relevant major antitrust theories fully to monopoly, for it combines the dominant decision not to include a general Spanish- ventilated in the CIS. Spanish-language radio broadcaster (HBC) language media market in its complaint is the with the dominant Spanish-language Sincerely, end of the story. But, as the CIS quotes the television broadcaster (Univision).2 This Ninth Circuit, ‘‘The court’s role in protecting Albert A. Foer Spanish-language broadcasting market the public interest is one of insuring that the President. (defined from the perspective of advertisers government has not breached its duty to the for which Spanish-language television and , 2003 public in consenting to the decree. The court radio are good substitutes) easily coexists is required to determine not whether a James R. Wade with a Spanish-language radio-only market particular decree is the one that will best Chief, Litigation III Section, Antitrust (defined form the perspective of other serve society, but whether the settlement is Division, U.S. Department of Justice, 325 advertisers). The Department’s Complaint ‘‘within the reaches of the public interest.’’ Seventh Street, NW., Suite 300, and Competitive Impact Statement are United States v. Bechtel Corp., 648 F.2d 660, Washington, DC. 20530 entirely silent on why the Department has 666 (9th Cir. 1981).’’ Because in practice a Re: United States v. Univision chosen to ignore the interests of advertisers complaint is drawn up by the DOJ at the Communications Inc., Civ. Action No. who are vulnerable to the enhanced market same time as a settlement order is drafted, 1:03CV00758 power HBC and Univision will enjoy as a the complaint is to some degree, in reality, result of their combination. not merely the cause of the settlement, but Dear Mr. Wade: Pursuant to the Antitrust Even accepting that Spanish-language the result of the settlement. Although we do Procedures and Penalties Act, 15 U.S.C. radio and Spanish-language television belong not want courts to displace the DOJ role of §§ 16(b)–(h), Spanish Broadcasting System, in separate markets, SBS disagrees with the determining what goes into a complaint, a Inc. (‘‘SBS’’) respectfully submits its Department’s conclusion that the only settlement that does not deal with obvious comments on the proposed Final Judgment competitive harm from this acquisition flows antitrust issues should not be approved until filed on March 26, 2003, by the Antitrust from Univision’s ownership of a significant the CIS adequately explains what is going on. Division of the U.S. Department of Justice stake in both Entravision and HBC. In this acquisition, the Complaint includes (‘‘Department’’) in connection with the Specifically, Univision’s acquisition of the facts about the two companies that would proposed acquisition of Hispanic dominant Spanish-language radio suggest to many observers that there may be Broadcasting Corporation (‘‘HBC’’) by broadcaster, HBC, will give Univision, the critically important competitive issues that Univision Communications Inc. dominant Spanish-language television go beyond the radio market. If the Tunney (‘‘Univision’’). broadcaster, an enhanced inventive to refuse Act is to protect the public interest, including A Univision and HBC combination raises to deal with or discriminate against Spanish- the perception that antitrust settlements are serious antitrust issues that the Department’s language radio competitors (such as SBS) not based on political considerations, both proposed Final Judgment fails to address. who seek to advertise through Univision. the public and the court must be provided The draft decree leaves unremedied Advertising on television is important for with sufficient information to determine significant harm to competition and promoting Spanish-language radio stations whether the complaint itself was consumers that surely will result from the and thus for surmounting the high entry unreasonably limited. combination of the dominant firm in barriers in Spanish-radio language that the The legislative genesis of the Tunney Act Spanish-language radio (HBC) with the Complaint identifies (Compl. ¶27). was concern that settlements might be made dominant firm in Spanish-language Moreover, after the merger, Univision/HBC on the basis of political rather than strictly television (Univision). Even if, as the will have the power to insist that Spanish- professional analysis. To expand the Department of Complaint posits, Spanish- Hypothetical of a Dominating Voice, if the language radio and television belong in 1 Letters expressing the views of such advertisers ownership of the merging parties happened separate markets, the remedy the Department can be found in a number of letters filed with the to be of the same political party as a Federal Communications Commission. See, e.g., selected fails to solve the competitive Letter from Phillip L. Verveer et al., Attorneys particular national Administration, allowing problem it identified: Univision’s significant the merger to proceed, subject only to a mild Willkie Farr & Gallagher to Marlene H. Dortch, influence over one of HBC’s closest Secretary, Federal Communications Commission radio divestiture, with the potential of competitors in Spanish-language radio, (, 2003) (attachments), available at http:// political gain for the political party, this Entravision Communications Corporation gullfoss2.fcc.gov/prod/ecfs/comsrch_v2.cgi would be the type of politicization of (‘‘Entravision’’). The settlement only partially (proceeding No. MB02–235) (attached hereto as antitrust that the Tunney Act was intended and incompletely disentangles Univision and Exhibit A). These letters demonstrate that there are to remove. many advertisers for whom the relevant market for Entravision. Moreover, the inadequate We certainly do not charge that this analyzing this transaction is not properly confined remedy the Department selected requires six specific merger is being approved for to Spanish-language radio. years to implement, a period during which 2 political gain, but are trying to make a larger HBC’s 2003 10–K explains that it ‘‘is the largest the transaction will continue to harm point. In order to protect antitrust from Spanish-language radio broadcasting company.’’ competition and consumers. Accordingly, the Hispanics Broadcasting Corp. Form 10–K (Mar. 31, Court should reject the proposed Final 2003), available at http://www.sec.gov/Archives/ (or video rental stores) that compete in myriad Judgment as not within the reaches of the edgar/data922503/000104746903011344/ neighborhoods, with a largely local clientele. One public interest. a2107188z10-k.htm. Univision ‘‘is the dominant of the chains features best sellers or the most broadcaster of Spanish-language television in the popular films, the other chain has a more eclectic 1. SBS initially notes its disagreement with United States, capturing an approximate 81% offering; including a wider range of special interest the Department’s decision to confine its audience share.’’ Entravision Communications and ‘‘artistic’’ selections. If the first chain were to analysis to the product market for the Corporation Annual Report for 2001, at 25, acquire the second, there might well be some local ‘‘provision of advertising time on Spanish- available at www.entravision.com. HBC’s and price effects, but the most important effect on most language radio’’ (Compl. ¶ 14). The Univision’s combined dominance is illustrated by consumers (but, not all) is likely to be the effect on Department defined this market because letters and charts filed with the Federal variety if the combined store adopts the buyer’s Communications Commission. See Letter from business model. ‘‘[m]any local and national advertises’’ would Phillip L. Verveer et al., Attorneys Willkie Farr & ‘‘This reality does not mean that the merger ‘‘not turn to other media, including radio that Gallagher to Marlene H. Dortch, Secretary, Federal should be attacked on that account. It might well is not broadcast in Spanish, if faced with a Communications Commission (, 2003) be, for example, that it is a lot easier for a potential small but significant increase in the price of (attached as Exhibit B) and Letter from Andres Jay new entrant to provide variety competition for the advertising time on Spanish-language radio’’ Schwartzman, President and CEO, Media Access merged enterprise than it would be to provide price or its equivalent (Id. emphasis added. The Project to Marlene H. Dortch, Secretary, Federal competition. What it does mean is that an initial Department, however, provides no Communications Commission (, 2003) focus on a hypothetical price effect, according to available at http://gullfoss2.fcc.gov/prod/ecfs/ traditional Guidelines analysis, might miss the most justification for ignoring the many other comsrch_v2.cgi (proceeding No. MB02–235) important questions.’’ advertisers for whom Spanish-language radio (attached as Exhibit C).

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00065 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66861

language advertisers who wish to advertise language television in the United States.’’ 3 A transactions. It plainly harms rather than through both radio and television purchase recent Entravision securities filing also benefits competition to require Entravision to time from both Univision and HBC rather strikingly illustrates the importance of the obtain its rival’s approval to undertake such than from the merged firm’s rivals, including affiliate agreement: Of an overall increase of actions. The Department should not hinder SBS. Such difficult-to-detect and subtle tying $1.5 million in revenue for Entravision over the competitive activities of third parties arrangements or refusals to deal—realistic the prior year, ‘‘$1.4 million was attributable through consent judgments. possibilities here—impair competition. See, to our Univision stations and 0.1 million was Third, the proposed Final Judgment would e.g., Lorain Journal Co. v. United States, 342 attributable to our Telfutura stations [a require Univision to reduce its equity stake U.S. 143 (1951). It is unrealistic to expect Univision network].’’4 in Entravision over a very lengthy period: to that, following the acquisition, advertisers The affiliate agreement plainly will give no more than 15 percent by March 2006 and to no more than 10 percent by March 2009. will stand up to the HBC/Univision colossus Entravision significant reason to pull its The Department acknowledges that this and challenge such practices themselves. The competitive punches against HBC once HBC is acquired by Univision. The Department divestiture is necessary to preserve Clayton Act properly is invoked to restrain competition; for Univision’s significant stake these restraints in their incipiency. recognizes this; for the proposed Final Judgment prohibits Univision from ‘‘using or in Entravision means that Univision/HBC The Department’s failure to grapple with attempting to use any rights or duties’’ under ‘‘would receive some significant benefit even any of the competitive problems posed by the affiliate agreement ‘‘to influence on sales it loses to Entravision’’ (CIS at 12). combining the dominant Spanish-language Entravision in the conduct of Entravision’s The Department nonetheless is willing to radio broadcaster with the dominant radio business’’ (Proposed Final Judgment tolerate the lessened competition and Spanish-language television broadcaster § VI.A.5). This remedy, however, is a mirage. consumer harm for as long as six years. should cause this Court to conduct an Univision need not actually use the affiliate Although the rapid sale of stock may be especially careful Tunney Act review. To be agreement to influence Entravision’s difficult to accomplish and impose costs sure, that review is largely confined to behavior. The mere fact that Univision might upon Univision, the costs of accomplishing determining whether the remedy the deny Entravision rights under the agreement, the transaction should not be borne by Department selected is a reasonable one for or even create disputes under the agreement, consumers. If owning the stock is the competitive problem identified in the will cause Entravision to compete less competitively harmful, Univision should be Department’s Complaint. See United States v. vigorously with HBC.5 Strikingly, the required to sell the stock as expeditiously as Microsoft Corp., 56 F.3d 1448, 1461–62 (D.C. Department has rejected such ‘‘behavioral’’ possible. The Department’s explanation for Cir. 1995). But when as here, the Department remedies in other circumstances, even when its unprecedented six-year divestiture has exercised its prosecutorial discretion to punishable by contempt if violated.6 The period—that requiring a faster sale by tailor its Complaint narrowly to the remedy Competitive Impact Statement provides no Univision protects against ‘‘adversely selected, the Court must pay special attention basis for believing that a ‘‘behavioral’’ affecting Entravision’s ability to raise capital’’ to ensure that the fit between remedy and remedy relating to the affiliate agreement will (CIS at 12)—fails to persuade. If the Department’s reasoning were valid, it would Complaint is indeed within the reaches of the be effective here. By contrast, blocking always permit divestitures to be made over public interest. As explained below, the fit Univision’s acquisition of HBC will preserve the course of several years; but that is here is very poor indeed. competition. obviously not the Division’s policy. And with Second, the proposed Final Judgment 2. The competitive problem the Compliant good reason: The longer the merging parties would allow Univision to retain shareholder identifies is that Univision’s significant hold assets that must be divested to preserve rights to veto major strategic decisions of control over, and its equity stake in, competition, the longer the period during Entravision, including any plans i) to merge, Entravision will cause HBC and Entravision which competition and consumers suffer. consolidate or reorganize all or substantially to pull their competitive punches once HBC The speculative fear that Entravision’s ability falls under Univision’s control. The proposed all of its assets; ii) to transfer a majority of to raise capital will be harmed by requiring Final Judgment seeks to preserve HBC/ its voting power; iii) to dissolve, liquidate or a shorter divestiture period is no warrant for Entravision competition by requiring terminate itself; as well as iv) to dispose of inflicting competitive harm on advertisers Univision to reduce its equity stake in any interest in any FCC licenses relating to and others. Entravision and to relinquish certain rights television stations that are Univision Fourth, the divestiture the Department Univision holds to control or influence affiliates (Competitive Impact Statement negotiated is insufficient to preserve Entravision’s competitive activities. For a (‘‘CIS’’) at 11). Each of these actions that competition. If the proposed Final Judgment number of reasons, the proposed Final Univision can veto may have significant is approved, Univision will continue to hold Judgment will not adequately protect competitive impact. If, for example, a ten percent stake in Entravision. Moreover, purchasers of radio advertising from the Entravision wanted to sell a radio station to, the Complaint alleges that Entravision and adverse consequences of Univision’s or merge with, a rival, the proposed Final HBC have combined market shares ranging proposed acquisition of HBC. Judgment leaves Univision with the power to from 70 percent to as much as 95 percent in First, the Department’s requirement that prevent possible competition-enhancing the several geographic markets (Compl. ¶ 21). Univision surrender certain rights and dilute It is plain that Univision will still financially its stock holding in Entravision fails to 3 Entravision Communications Corporation benefit from every advertising dollar HBC address the most significant way in which Annual Report for 2001, at 25, available at loses to Entravision and, therefore, that www.entravision.com. Univision/HBC will compete less vigorously Univision influences Entravision: through 4 Entravision Communications Corporation 10–Q, the Univision/Entravision affiliate agreement. than if Univision’s equity interest were at 7 (, 2003), available at divested completely. The Competitive Impact As the Department’s Complaint explains, www.entravision.com. Statement fails to explain why a complete pursuant to this ‘‘long-term’’ agreement, 5 See, e.g., Letter from Arthur V. Belendiuk, ‘‘Extravision broadcasts Univision Counsel to National Hispanic Policy Institute, Inc., divestiture is inappropriate here. programming from Univision’s two networks to W. Kenneth Ferree, Esq., Chief, Media Bureau, Thus, for several reasons, the proposed Final Judgment leaves Entravision entangled on 49 television stations. As part of this Federal Communication Commission (, with Univision in ways that will seriously affiliation agreement, Univision serves as 2003) (attached as Exhibit D). 6 harm competition. The Court accordingly Entravision’s sole representative for the sale For instance, the Department rejected Northwest Airline’s suggestion that creating a voting trust for should find that the Department’s proposed of television advertisements sold on a the stock it acquired in Continental Airlines would Final Judgment is not within the reaches of national basis’’ (Compl. ¶ 23). This prevent a diminution of competition between the the public interest. agreement is Entravision’s lifeblood. From it, two airlines. The Department explained: ‘‘Courts Respectfully submitted, Entravision obtains key programming and are understandably loathe to rely on ‘behavioral Claudia R. Higgins significant advertising revenue. As rules’ as a substitute for divestiture, even where the rules are court-ordered.’’ Trial Br. of the United Kaye Scholer LLP Entravision’s 2001 Annual Report explains, 901 15th Street, NW., Suite 1100, ‘‘Entravision has benefited enormously from States at 18, United States v. Northwest Airlines Corp. (No. 98–74611, filed Oct. 24, 2000) (emphasis Washington, DC 20005, (202) 682–3653, a close relationship with Univision’’ which is added), available at www.usdoj.gov/atr/cases/ Counsel for Spanish Broadcasting System, ‘‘the dominant broadcaster of Spanish- f7200/7288.htm. Inc.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66862 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Dated: July 18, 2003. policy points relevant to the resolution of Let Me explain: One could safety say that Exhibits Attached. this important matter. (We note that the for the first time in U.S. History, there has submission, inexplicably, is not posted on been a CATERING to Spanish language, not United States v. Univision Communications, the ECFS site and thus remains unavailable so much out of a sociological sense of Inc., Civ. Action No. 1:03CV00758, to anyone seeking to follow the proposed responsibility, but out of the dire necessity of Comments on Behalf of Spanish transaction through the Commission’s Web the large and small American corporations to Broadcasting Inc., July 18, 2003, Exhibits A– site). open new markets to replace maturing ones D Finally, we note the unusual circumstance in the U.S. They do this by attracting an ever Exhibit A presented by today’s Commission vote growing group of people (the largest single fundamentally changing its principal media minority in the U.S.) which could not be June 2, 2003 ownership regulations (following the most otherwise addressed. There are 27 Latin Marlene H. Dortch exhaustive and comprehensive review of American countries with endless political Secretary, Federal Communications [the] broadcast rules ever undertaken’’) and and economic travails, which only serve to Commission, 445 12th Street, SW., the pendency of this major broadcasting increase the CONTINUOUS, NON- Washington, D.C. 20554 transfer application. As we are able to learn STOPPING Immigration WAVE to the LAND Re: Applications for Transfer of Control of the details of the new ownership rules, we of opportunity. Hispanic Broadcasting Corp., and Certain will submit our analysis of their significance Second: Are Spanish language video Subsidiaries, Licensees of KGBT (AM, for the Univision proposal. (television and cable) and radio substitutes Harlingen, Texas et al. (Docket No. MB 02– Respectfully submitted, for one another? 235, FCC File Nos. BTC–20020723ABL, et /s/ Philip L. Verveer I have no doubt that Spanish and English al.) Philip L. Verveer language media are in different markets from Dear Ms. Dortch: Spanish Broadcasting Sue D. Blumenfeld the perspective of advertising buys. A small, System, Inc. (‘‘SBS’’) has asked more than Michael G. Jones but significant non-transitory increase in twenty advertising agencies and advertisers David M. Don price in English language media will not with special knowledge of the Hispanic WILLKIE FARR & GALLAGHER, 1875 K induce the advertisers with whom I am community to address the nature and extent Street NW, Washington, DC 20006, familiar to shift their advertising to Spanish of the media marketplace in which they Telephone: (202) 303–1000, Facsimile: language media. Instead, they will absorb the conduct their business. Their responses are (202) 303–2000 price increase. The reverse also is true. The reason is that attached. and All of the responses indicate that English- for many products the target audience simply language broadcasting and Spanish-language Bruce A. Eisen cannot be reached unless it is addressed in (Hispanic) broadcasting constitute separate Allan G. Moskowitz their familiar language. Among other obvious markets. Many of them observe that the KAYE SCHOLER FIERMAN HAYS & bits of evidence, the major television Spanish-language broadcasting market HANDLER, LLP, 901 15th Street NW, Suite networks virtually never present a includes both radio and television. 1100, Washington, DC 20005 commercial in Spanish (or any language These propositions are fundamental to the Attorneys for Spanish Broadcasting System, other than English, for that matter). Commission’s analysis of the proposed Inc. Spanish language video and radio are Univision Communications, Inc.—Hispanic cc: Chairman Powell, Commissioner substitutes for many advertisers. Many Broadcasting Corp. merger. The agency and Abernathy, Commissioner Copps, advertise on both. Many sponsors are quite advertiser perspectives on the market address Commissioner Martin, Commissioner willing to allocate and reallocate percentages both competition and diversity, just as the Adelstein, Susan Eid, Stacy Robinson, of their ad budgets to video or to radio Commission must in connection with its Jordan Goldstein, Catherine Crutcher depending upon shifts in the price and public interest determination on the Bohigian, Johanna Mikes, Ken Ferree, ratings of one or the other. A small, but permissibility of requested transfers. David Brown, Scott R. Flick, Counsel for significant increase in price in one will shift The conclusions of the agency and Univision Communications, Inc., Roy R. purchases to the other for many products. advertiser executives conform with those the Russo, Counsel for Hispanic Broadcasting It is very common in negotiations over Commission has reached in other contexts. Corp. advertising rates, for agencies and clients to The Commission often and recently has make the claim, for example, that if recognized the existence of a separate May 27, 2003 concessions in price are not made, the Spanish language broadcasting market. It also To Whom It May Concern advertising will be placed on the other has recognized that television and radio are Dear Sir or Madam: I have been involved medium, video or radio as the case may be. part of the same product market for in the Hispanic Market USA since 1966 and I hope that you find this information fundamental Communications Act purposes. have owned my own firm for over 31 years. helpful. I would be happy to discuss it at The separate nature of the Hispanic During that time, I have placed national greater length if you would find it useful. broadcasting market means that the FCC may and local ads for a very wide variety of Sincerely, not rely exclusively on its cross-ownership companies, government agencies, and other Castor A. Fernandez, and multiple ownership rules in making its public and private institutions, large and President/Creative Director, Castor public interest determination. These small including Coca Cola, McDonald’s, May 27, 2003 heuristic devices may be a sufficiently Procter & Gamble, General Motors, Anheuser reliable basis for decision where transfers Busch, , Pizza Hut, Burger King to The Honorable Michael K. Powell implicate majority-language broadcasting. mention just a few. I am also the single Chairman, Federal Communications Their reliability cannot be assumed where largest individual receiver of Creative Commission, Washington, DC 20554 minority-language broadcasting is concerned. Awards in the industry, and was placed in Dear Mr. Chairman, My name is Eduardo In this case, the proposed merger moves the the Hispanic Market Hall of Fame (only 4 Caballero, President/CEO of Caballero TV & Hispanic market very decidedly in the recipients so far), in 2002. Cable Sales, an independent-Spanish TV direction of monopoly. Both the statute and I have been asked to address two issues: stations sales representative. ordinary prudence require that the decision First: Is there a separate advertising I started selling Spanish Media in February in this matter be the product of careful product market defined by the Spanish of 1962, as a local salesman for Radio Station analysis of record evidence and that it be language? In other words, are Spanish WBNX, New York City. I became its General reflected in a reasoned explanation. language media and English language media Sales Manager that same year. In this regard, SBS will respond to the substitutable for one another? I resigned in March of 1968 to become many factual assertions contained in the May The answer is an unequivocal: NO! General Sales Manager of Spanish TV Station 14, 2003, Univision submission shortly. English language media and Spanish WXTV, Channel 41, New York Market Unsurprisingly, we do not find Univision’s language media are NOT substitutable. There (licensed to Paterson, NJ). propositions probative of the substantive definitely is a separate advertising product Also in 1968, I became a VP and Director issues nor do we find Univision’s legal and market defined by the Spanish language. of National Sales for Spanish International

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66863

Network (S.I.N., the predecessor of speaking consumer does not play any role in Caballero Spanish Media Inc., the Spanish Univision), with affiliate stations in San the marketing plans of ANY of the hundred media sales representative in this country. Antonio, Los Angeles, Fresno, New York, of national advertisers who are NOT His company started representing four Miami, San Francisco and Chicago. advertising in the Spanish language, simply Spanish TV stations (all of the independent In 1973 I resigned that position, as the because the Spanish market is not integrated Spanish stations existing at that time), and first—and only—Hispanic to be in charge of in their general market strategy, and as they fourteen Spanish radio stations (out of less national sales for any ‘‘national network’’ in say, ‘‘it has to be treated differently’’, than 35 existing stations). Eduardo also U.S., to start the first Spanish Radio National language and otherwise. syndicated a weekly Spanish movie, which Sales Representative in this Country Many times we were confronted with ran in twenty-nine television stations, almost (Caballero Spanish Media, Inc.), representing situations when general market agencies all of them general market stations, using over 140 Spanish radio stations. placed schedules on some of our represented Ricardo Montalban as the presenter, and with Amongst stations represented by CSM were stations; when they found out that we were the sponsorship of the Bristol Myers those owned and operated by Heftel broadcasting in Spanish, they canceled that company. Broadcasting, Tichenor Broadcasting Co. schedule because, according to them, they In 1976 Eduardo decided that he should be (both of these Companies were the were buying ‘‘radio’’ not ‘‘Spanish radio’’ or involved exclusively in radio, where he saw predecessors of the actual Hispanic they were buying ‘‘television’’ not ‘‘Spanish the greatest potential for C.S.M. His company Broadcasting Company—HBC), Spanish television’’. grew to represent over 140 Spanish radio Broadcasting System, Liberman Broadcasting, Still, today, we confront many situations stations from coast to coast, covering over Excel Broadcasting, the Z Network, etc. where most national (or general market) 95% of the Hispanic consumers in the CSM was sold in 1995 to the Interep advertisers do not buy any Spanish language country, opening opportunities for new radio Company (a General Market—English media because they (the advertisers) are not operators and hundreds of jobs for both, language—radio representative). Interep has ‘‘prepared’’ to go into the Spanish market. Hispanics and non-Hispanics. kept CSM, to this day, as a separate Spanish Another point I want to make is the In 1995, Eduardo sold C.S.M. to Interep, division. following. A General Market Network (radio and remained with the Company until the I remained with the Company until 1998, or television), to be considered as such, has beginning of 1999, when he left work on his when I undertook the creation of a TV (low to guarantee advertisers to cover about 80% new project, Caballero Television, owner and power stations) Network—MasMusica of the total U.S. population. In the case of operator of twelve LP television stations, all TeVe—to broadcast Spanish music, 24/7. At Spanish Networks, they are required to cover of them located in Central California and the present moment this programming is ONLY ABOUT 80% OF THE HISPANIC Texas. He created his own network—Mas broadcast over 21 Spanish TV stations within POPULATION. Certainly, those Hispanic Mu´ sica Teve-broadcasting 24 hours of music the U.S. ADIs where about 80% of the National videos. Caballero Television has offices in Most recently, since there is no any Hispanic population resides do not even get Dallas, New York Miami and Bakersfield, CA. advertising sales organization representing close to cover 80% of the General Population Recently, the Broadcasters’ Foundation independent TV stations—including mine of the U.S. This marks another very clear presented to Eduardo, The American and others—I have started a new—and separation between the General and the Broadcast Pioneer Award, as the first only—independent Spanish TV Spanish Markets. Hispanic to receive this award. representative sales organization, Caballero If I can be of any help to this Commission, In September 2002, Eduardo was honored TV & Cable Sales. please, do not hesitate to have any of your by the American Advertising Federation with I have been selling time for Spanish Media associates to contact me. the Mosaic Award. in United States (both radio and TV), for the Sinceramente, Eduardo lives with his wife of 41 years, last 42 years, uninterruptedly. I can say, Raquel, in Miami, Florida. They have a unequivocally and based on my professional Eduardo Caballero, Personal Bio daughter, Rosamaria, also a lawyer, who experience, the following: Eduardo Caballero was born in the Oriente graduated from Georgetown Law School. Unless an advertiser makes the decision to Province, Cuba. Went to school in Sagua de Married, with two daughters, Sofia and promote its products or services to the Ta´namo and Havana, where he obtained a Paloma, she lives, with husband P.J. Stafford, Hispanic consumer, in Spanish and, Degree as Doctor in Law from the Jose Marti in New York City. subsequently, creates a ‘‘Hispanic Budget’’, University. Eduardo is, or has been, involved in the there will not be schedules placed on any Started his own law firm with his wife, following organizations: Spanish Media. Raquel Miller-Caballero, also a lawyer, and Chairman-founder of the Hispanic arm of Unfortunately, that ‘‘Hispanic Budget’’, practiced that profession in Havana, until the the Media Partnership for a Drug Free when it does exist, amounts, at best, to a 1 end of 1961, when, in view of the political America. to 3% of the ‘‘general market budget’’ situation in his country, decided to come to Member of the U.S. Postal Service (although Hispanic consumers represent the United States as a political refugee. Marketing Advisory Board. about 14% of the total U.S. population, Under a program of relocation sponsored Founder of the Spanish Radio Association according to the Census Bureau). That brings, by the U.S. Government, he and Raquel went, of America. Former Member of the Board of the as a result, the situation where many of those first, to Dallas where he worked, Stations Representative Association (S.R.A.). advertisers’ Hispanic budgets cannot afford simultaneously, at a restaurant, as a host, and Former Member of the Board of Directors both television and radio schedules. at a department store, as a salesman; later on, of the Advertising Counsel. Many of those advertisers are willing to they went to New York where, in 1962, Former Member of the Arbitron Bi-lingual allocated and reallocate parts of their Eduardo started his career in broadcasting, Advisory Committee. Hispanic budgets to TV or to radio, landing a job as a salesman for a local Founder of the Association of Hispanic depending on changes of rates and the ability Spanish radio station (WBNX), through the Advertising Agencies (A.H.A.A.). of a particular medium to negotiate those offices of a client of his former law firm in Former Member of the Board of Trustees of rates. The fact is that Spanish language TV Cuba. the National Hispanic University (San Jose, and radio are substitutes for many Soon he became the first Hispanic in USA CA). advertisers. to hold the position of General Sales Manager Former Member of the Board of the Every advertiser in the U.S. considers this of a radio station. National Drop-out Prevention Foundation. to be a SEPARATE AND DISTINCTIVE In 1968 he helped to create what was He is also a proud member of the N.A.B. MARKET. In fact, most, if not all, of the still known as Spanish International Network and of the Pioneer Broadcasters, among many very few advertisers who have decided to (SIN), today Univision. He was appointed other organizations. advertise in the Spanish language have, first, first General Sales Manager for WXTV, funded a SPANISH ADVERTISING Channel 41, New York and soon after that, Hi Albert, as per your request, following BUDGETS, then created a SPANISH in 1969, he became an Executive VP and are my thoughts on why the Hispanic market MARKETING DEPARTMENT and, lastly, Director of National Sales for the Network. should be treated separately from the general chosen a SPANISH ADVERTISING AGENCY. In March of 1973 he resigned his position, market. As you know, I have over 15 years Without those three elements, the Spanish and, again, together with wife Raquel, started in the industry. Most of these years have

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66864 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

been with agencies specializing in Hispanic Sources: Nielsen Universe Estimates 2002, differ based on country of origin. They marketing and advertising. I am currently Strategy Research, Yankelovich 2000, Center exercise sensitivities to these differences with Diario Las Americas, South Florida’s for Media Research 10/7/02. when creating an advertising message. first Hispanic daily newspaper. Advertising in Spanish-language is proven Important, as well, is not to stereotype this The U.S. Hispanic media market should be to be far more effective with Hispanics. market. According to the Roslow 2000 study on treated separately from the non-Hispanic Spanish language preference has not advertising effectiveness among U.S. decreased throughout the years as many had media market. Hispanics differ in many ways Hispanics: ad recall rises 61% for those predicted. It has actually increased. One from non-Hispanics: viewing in Spanish, communication is 57% contributor to the increase could be the • Larger households 3.4 vs. 2.5. more effective and persuasion is 5 times • greater. increasing acceptance of Spanish-language, Hispanics are younger 27.6 vs. 37.2. as well as, what many are calling ‘retro- • More HH with children 18 58% vs. 34%. Marketing to Hispanics should not only be in Spanish-language but should also be acculturation.’ Latinos are feeling more • Religion is more important in their lives, culturally relevant. Translation of general comfortable with their culture and the use of 80% vs. 46%. Spanish-language. Great contributions by • market copy is not an effective or efficient Language preference—over 90% of approach for delivering the target. Latinos in the areas of sports, entertainment, Hispanics speak some Spanish, over 70% Advertising should be culturally relevant and and business have laid out a new dynamic prefer to speak Spanish at home and over dialect sensitive. Agencies specializing in for Latino youths. They are more proud to be 50% prefer to speak Spanish on social Hispanic advertising and marketing a part of the Hispanic community and to be occasions. understand that accents and terminologies considered Latinos.

The Hispanic market is separated from household incomes are starting to catch up media market is a separate market for the general market by language and culture. with national averages. The Global Insight purpose of assisting the FCC in its ongoing Hispanics have different viewing and report estimates that Hispanic household review and analysis of the pending merger of listening patterns. That is why the top rated incomes should grow from 77% of the Univision Communications and Hispanic programs (overall—Hispanic & general national average in 2000 to 82% by 2020. The Broadcasting Corporation. market—source Nielsen Hispanic Station Selig Center for Economic Growth at the From a marketing standpoint the US Index) on television for Hispanics are University of Georgia says Hispanic Hispanic market is a separate marketplace. ‘novelas’ on Univision; and why the top disposable income will reach $926 billion in Marketing to Hispanics requires radio stations in major Hispanic markets are 2007, up some 60% from $580.5 billion last understanding of the cultural differences that Hispanic stations. Some Hispanics can be year. Meanwhile, non-Hispanic buying exist versus the General Consumer, reached through general market advertising power will grow less than 28%, to $8.9 understanding that creatively Spanish- efforts (spill), but the effectiveness and trillion. The Selig Center estimates that in language commercials need to reflect Latino impact of the message is not the same (per five years Hispanics will account for 9.4% of cultural nuances and queues to be fully Roslow 2000). Hispanics are more likely to the nation’s disposable income, up from effective in producing similar results versus buy brands that advertise to them in Spanish- 5.2% in 1990. the General English-language commercials. language. Many advertisers have become Both television and radio have seen the More than 50% of the US Hispanics are saver to the fact. In November Burger King growth. Advertising on Spanish-language TV Spanish-dominant. In the West Coast that Inc. set aside swathes of aisle space in nearly grew 16.5% last year, over twice the 7.6% number is closer to 60%. While long time 1,000 of its stores for videos dubbed in growth by all broadcast TV, estimates Gordon residents and US born Latinos speak English Spanish. In December, Kmart Corp. Hodge of investment bank Thomas Weisel so that they can function in mainstream announced the launch of an apparel line Partners. Today there are 8 times the number America, various factors which include, the named after Mexican pop star Thalia. P&G of Hispanic radio stations than there were 20 growing population, strong Hispanic created a magazine-style direct mail piece years ago. communities, and immigration keep fueling specific to Hispanics. 1980: 67 Hispanic Radio Stations the desire for Hispanics to hang on to their Some companies early to see the potential 2002: 600 Hispanic Radio Stations culture, their language and entertainment are cashing in Sales of Ford brand cars and Get the picture? It seems some major preferences. light trucks to the Hispanic market grew 40% companies have, and it sell $$$. They The Hispanic market is not one Monolithic in the past five years. After the company understand the importance of the Hispanic segment of the population, it is a complex started using Mexican bombshell Salma market. They see it as a separate market, and group comprised of many segments with Hayek to market its Lincoln brand last year, so should we. different cultural nuances and origins, united Hispanic purchases of Lincoln Navigators Sincerely, by one language. grew 12%, while sales to non-Hispanics were Leticla R. Pelaez Spanish-language media plays a very big flat, says a Ford Motor Co. spokeswoman. At Director of Advertising part in reaching out to the different segments Honda Motor Co.’s American arm, Latino of the population by continuing to supply purchases grew to 8.4% of all vehicles sold May 22, 2003 programming that feature relevant content last year from about 7% five years ago. Federal Communications Commission that speak to the Latino preferences. With the nation’s economy as a whole 445 Twelfth Street South, Washington, DC. In the case of Spanish-language TV, stagnating, the U.S. Hispanic population is 20554 Experience has shown that original emerging as one of the most promising To Whom It May Concern, My name is productions with familiar content such as motors for growth. Driving the growth is the Raquel Tomasino, I am Media Director of Latino entertainers, International dramas and population’s higher-than-average birth rate Castells & Associados and have been asked Futbol/Soccer is a formula for success. The and immigration. Additionally, Hispanic to comment on whether the U.S. Hispanic English-TV programming, such as ‘‘Charlie’s

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00069 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 EN28NO03.004 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66865

Angels’’ and ‘‘Reyes Y Ray’’ (Starsky & examples are Colgate-Palmolive left behind 3. Recruiting a Native Spanish Speaker To Hutch) remakes in Spanish that some by P&G, or Toyota topping Chevrolet. Critique Your Agency’s Creative networks tried to reproduce and run on Continual short-term messages lead to poor Just Like the General Market, Let the Spanish-TV proved to be unsuccessful. brand perception, discounting and brand Hispanic Consumers Be The Judge. Please Radio has become the optional source of erosion. You need a branding campaign with don’t say, ‘‘Juanita Garcia says the words are information and news not only about our ‘‘legs’’ and a multi-media mix, beyond TV to not right.’’ Regis & Kelly are not asking you homeland but our communities, with radio, OOH, DR, on-line, print, etc. to write their monologue, so don’t rely on commercials that we can actually understand your housekeeper to critique the work done and follow in our language. Radio also offers 7. Consistently Opting for General Market by a creative with a Masters and 15 years the variety in programming needed to finely ‘‘Transactions’’ experience. Do the same type of copy target the different segments of the Hispanic Stay True To The Brand, Seek Synergies research as the GM, qualitative or communities. With Hispanic Consumer Relevance. Look for quantitative, it all exists. Assure your Like the Central American who listen to synergies and commonalities between Hispanic ads deliver the strategic and Cumbias, the Caribbean’s who prefer Salsa, communication goals. the South American’s like Spanish-Rock and General and Hispanic consumer segments, the Mexican Community who love their but don’t force-fit. Transcreating GM 2. Hispanic Programs Must Pay Out in Rancheras and traditional sounds of Mexico. strategies or creative may work when the Incremental Volume concept transcends ethnicities or for short- As an agency it is important for us to Have a Measurable, Realistic and Agreed- educate our clients on the most effective way term promotions, but consistently employing this approach becomes ineffective. Just think Upon Hispanic ROI and Report Card. There to reach the Hispanic consumer. We are is a base cost for customer retention and about all the GM money you spend to responsible for creating advertising that is maintaining brand share, and the Hispanic identify that key consumer nugget, or that compelling, that builds awareness and program should not payout solely on consumer loyalty and at the end of the day breakthrough ad. Know the cultural nuances incremental sales. The reprt card should be we need to deliver these through the various, that affect your direction and define ad based on cumulative measures; Hispanic relevant forms of media vehicles. relevance. sales tracking, field surveys and pre/post That’s why we have a list of ten things to quantitive tracking studies. Don’trelegate avoid when marketing to Hispanics. Below is 6. Oversimplifying and Underestimating the Potential of the HCM Hispanic research to the back shelf. Employ a top line of the top ten things not to do by the proper research size and methodology to Liz Castell-Heard, President of Castells & Quantify the Hispanic Business Potential ensure the Hispanic sub-segments are well Asoicado: With Sound Research and Analysis. Put the defined and represented. 10. Approaching the Market as if It Were a stats to work and figure out the actual 1. Not Allowing Your Hispanic Agency To Monolithic Segment potential, by market, by account. Once you assess the huge potential, ‘‘package’’ it Challenge Status Quo ‘‘One-Size Fits All’’ Approach No Longer internally. Call it a profitable ‘‘division’’ or Demand High Performance From Your Works, Unless It’s just the Start. Hispanic establish a multi-discipline Hispanic Hispanic Agency. Demand the same level of marketing has evolved from the ‘70’s committee to facilitate its viability. excellence as your General Market agencies. ‘‘orphan’’ to the ‘‘childish’’ ‘80’s regional Be inclusive with your agency and set clear efforts; the post-pubescent 90’s of 5. Inadequate Allocation of Company goals and expectations. Think of your agency homogenization; and now to bicultural Resources to ‘‘Hispanic’’ as a marketing partner, as the more segmentation, as ‘‘Hispanic’’ grows up as an Proper Allocation of Hispanic Marketing knowledge shared, the better the work. Allow adult rich with complexities. It’s beyond Budgets and Resources Is Key. Inadequate Hispanic programs to evolve, flourish and country of origin—one generic ‘‘broadcast’’ pre-planning, sub-standard concepts, limited Spanish can be effective. It’s knowing what increase. Hire a true Hispanic agency, not a makes us tick; foreign-born (58%) or US ‘‘test efforts,’’ poor tactical executions and Hispanic ‘‘division,’’ or one—like Castells & born; Spanish-dominants (58%) or reaching lack of performance metrics devalue Asociados. bilinguals/English-dominants with Hispanic potential. Don’t say, ‘‘This is all we Sincerely, culturally-relevant English ads (like African- have for Hispanic this year.’’ Hispanic should Raquael Tomasino, American). It’s targeting various age targets be an integral part of the budget pre-planning EVP, Director of Media Services process. Assess Hispanic share vs. the GM; and influencers. Companies like McDonald’s The Honorable Michael Powell, Chairman and weigh the trade-offs of where you spend. who do this well, have very strong Hispanic Federal Communications Commission, 445 positions. The $2.4 Billion spent in Spanish is still less 12th Street, Southwest, Washington, D.C. than 4% of all ad dollars—But it’s changing 20554 9. Not Understanding Your ‘‘Hispanic’’ quickly as companies spend more; traditional Dear Chairman Powell: My name is Linda Category categories like packaged goods, newer Lane Gonza´lez, president of The VIVA Category Dynamics Don’t Automatically categories like telecomm, health, travel, Partnership, Inc., a Miami-based advertising Apply. Know & Embrace The Differences. entertainment, or high-tech. Your ‘‘Hispanic’’ category is not at the same agency specializing in the U.S. Hispanic point of its lifecycle development; and 4. Thinking Hispanics Are Effectively market. My professional experience over the Latinos are often behind on the learning Reached Via English Media past 15 years has been almost exclusively in the U.S. Hispanic market, having worked curve. Cultural and lifestyle differences affect Spanish Ads are Critical; English-language with some of the greatest pioneers of our perceptions, needs, motivations and Spillover Is Not Necessarily Effective. Don’t field, Lionel Sosa, Carlos Montemayor, Paul advertising. Demographic barriers may not say, ‘‘Half of Hispanics see our spots, they’re Castillo and others over the years on a variety exist; but perceptual barriers need to be the ones with the money.’’ Spanish media addressed, like in cable or banking. of accounts including Chrysler, Builder’s continues to grow; 70% of Hispanic TV Square, Cuervo, CBS, Verizon Wireless, 8. Not Having a Long-Term Hispanic Market viewing goes to Spanish, up from 45% in Uniroyal, Meow Mix, and Entenmann’s. Plan 1995. Spanish broadcast gets the majority of I have been asked to comment on whether Have a Consistent & Integrated Hispanic share even among bilinguals. To know what or not I believe the U.S. Hispanic media Strategic Branding and Retail Plan. You need to spend, apply a systematic budget formula market is actually a separate market. My to have bilingual training, people, operations; that accounts for Nielsen spill, Roslow answer is an emphatic yes. To which could multi-media advertising, promotions and PR. comprehension, population and CPP’s. be added an emphatic of course! Hispanics Some believe you don’t need a Hispanic Nationally, 10% of total dollars should go to are different in many ways: be it culture, branding campaign due to the myth of Spanish, 4% to English-Hispanic; in L.A., language, or the numerous customs and Hispanic brand loyalty. Hispanics will 30% to Spanish, 11–18% to English- traditions. Research shows that in-language respond and brand-switch. You can’t assume Hispanic. Hispanic median income is $49K programming is more impactful to the your established General Market or Latin (85 index vs. GM), so it’s highly likely Hispanic target when it connects on a deeper American efforts will bleed over. Classic Hispanics can afford your product. level, in language and culturally relevant.

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00070 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66866 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

The Hispanic media market and its television stations broadcasting in their own culture or a growing consumer powerhouse numerous vehicles are a separate, relevant language. The Spanish language radio and loyal to their ethinicity. Time has proven that entity. From Nielsen to Arbitron—media is TV stations serve a distinct consumer base the latter is the correct assessment of this adapting and adjusting to the ever-growing with different brand awareness, tastes and market. Almost everyday, articles are Hispanic population. Nielsen has adjusted preferences. To be sure it’s a separate published in major newspapers throughout the way it measures audience levels due to population with different growth rates. the United States confirming the importance the exploding Hispanic numbers. Arbitron As the F.C.C. reviews the Univision/HBC of reaching Hispanics in their own language, continues to be challenged and is currently merger I hope the information highlighted showing sensitivity to their particular modifying their methodology on how to here will help provide direction and the right customs. accurately measure Hispanic audience levels. decision to this important question. The Hispanic market has evolved into a I hope my comments will be useful in the Sincerely. rich mosaic of cultures. Each segment with commission’s consideration of the U.S. Richard Cotter its own set of goals, music preferences and Hispanic media market as a separate and Senior Partner, USA Director of Local interests. There are two common relevant entity and in its review of the Broadcast denominators: Language and pride of culture. Univision/HBC merger. Endless research has shown time and time Very sincerely yours, May 2003 again that Hispanics respond better when Linda Land Gonza´lez, As a media executive, I’ve been asked to approached in espan˜ ol. The message is even President, The VIVA Partnership, Inc., 4141 comment on whether the US Hispanic media more effective if it is tailored to their N.E. 2nd Avenue, Suite 203E, Miami, FL market is a separate market from the general particular cultural background. Hispanic 33137 market. There is no question that the media, particularly radio and TV play a key Hispanic market is indeed separate and role in the success of any promotional effort May 27, 2003 should always be considered as such. targeted to this important market. Hispanics The Honorable Michael K. Powell There is ample evidence and factual depend on radio and TV for their news, Federal Communications Commission, 445 corroboration to conclude that this to be true. entertainment and lifestyle trends. Hispanic 12th Street, SW, Washington, 20024 The language of preference for many radio and TV are their emotional link to their Dear Chairman Powell: My name is Tere Hispanics, whether they are recent arrivals or roots. Zubizarreta, President & CEO of Zubi US born, is Spanish. The importance of the Hispanic media, in particular radio and Advertising. culture to Hispanics is such that parents TV, has evolved into a market in itself. Using I have been asked to comment on whether instill pride in language, customs, music and the most efficient technology and combing it the U.S. Hispanic media market is a separate dance to their children. In the mid seventies, with the characteristics of the Hispanics’ market. There’s no doubt that the Hispanic the US had about 50 Spanish-language radio simpatı´a, makes it stand out and be different media market is an entity completely stations in the entire country. Today over 600 from any other mass communication venue. separate from the ‘‘general market’’. radio stations dot the landscape with stations I trust that the views offered here may be As will be shown below, there is ample cropping up in markets where just 10 years useful in the consideration of the U.S. evidence and factual corroboration to ago no one would have guessed the need for Hispanic media market as a separate and conclude that the U.S. Hispanic media Spanish formats would be. relevant venue. market is a separate market. The same holds true for Spanish-language The Hispanic media market stands alone TV. We’ve seen the growth in the number of May 27, 2003 since it caters strictly to those U.S. residents networks and independent stations To Whom it May Concern: My name is Pat (33 million by 2000 census). In their native everywhere. Some markets, such as Chicago, Delaney. I am President of DMA and have language, taking into account cultural Miami and Los Angeles have at least five been in the advertising industry for over 27 idiosyncrasies and family values. Spanish-language TV options. years. I have planned and purchased all The media availability to address this The bottom line is, if you don’t speak mediums throughout the US for clients such market is professional in its programming Spanish, chances are you ignore Spanish- as: Reebok, Wendy’s International, BMW, and formats are according to the language media. Similarly, if you don’t speak AutoNation, Terminix, Rite Aid Drugs, Toys demographics in each of the major Hispanic English, or just simply prefer Spanish, R Us, just to name a few. markets. chances are you ignore English-language I have been asked to comment on whether This fact is particularly important when media. So if you’re not speaking to me in the the US Hispanic media market is a separate looking at the radio and TV networks as the language I prefer, I’m not listening to your market. Also, whether there is ample primary source of communication with this message. Few advertisers can afford to ignore evidence and factual corroboration to fast growing market. this market. conclude that the US Hispanic media market I hope the information provided will be There is no question as to the relevance of is a separate market: useful in the consideration of the U.S. this market, and ample evidence exists that The US Hispanic market is a separate Hispanic media market as a separate relevant it reached through Spanish-language media. market. Hispanics listen and watch various market. Emma Moya mediums differently than Anglos. With the Sincerely, VP/Client Services, Amistad Media Group, available research on Hispanics, it clearly Tere A. Zubizarreta 815 Brazos Street, Austin, Texas 78701 shows that while many Hispanics are bilingual, they still speak Spanish at home May 21, 2003 May 21, 2003 and do listen or watch Hispanic radio or TV. To Whom It May Concern, I’m Richard Ladies and Gentlemen: I am the Marketing It’s also substantiated by research that the Cotter, Senior Partner and Director of Local Director for the Historical Museum of number one radio or tv station in a given Broadcast for Mindshare. We’re one of the Southern Florida. My career in marketing market (eg. Los Angeles, Miami, etc.) is largest buyers of time on radio and television and advertising expands more than twenty Hispanic. This reflects all stations in a stations in America. years of experience in TV, radio and major market, not just Hispanic and indicates to an I’ve been asked to weigh in on the question publications in the Caribbean and United advertiser that a large percentage of their if Hispanics in the United States represent a States. potential customers are being missed if discreet market. The question is important I have been asked to offer some Hispanic media is not being purchased. In because it’s being used in the analysis by the observations about whether Hispanic media many markets, Hispanics account for over F.C.C. concerning the proposed merger of in the United States should be considered a 50% of the market. Univision Communications and Hispanic separate market venue from that of the Over the years I have found that with the Broadcasting Corporation. There’s ample general market. My answer is a definite, si, available research an advertiser can evidence and factual corroboration to por surpuesto. effectively reach their potential customers by conclude that the U.S. Hispanic media For the last two decades, major U.S. using both Hispanic and Anglo mediums. market is a separate market. corporations have debated whether or not to The research provides duplicated and First, the Hispanic media market is consider Hispanics just a minority group who unduplicated listenership/viewership of the separated from the rest by it’s own radio and will, in time, assimilate to the American media purchased to assure full coverage of

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00071 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66867

both Hispanics and Anglos. Without this Ana, I hope this information helps you Commissions consideration as it reviews the research it would be a shot in the dark. with your survey and please understand this Univision/HBC merger. The central point is I hope this information provided will be is my opinion and not of Labatt USA. the US Hispanic media market is a separate useful in the consideration of the US Sincerely Yours, entity. First, the radio and TV stations which Hispanic media market as a separate relevant Nelson Quintero make up this market deal a separate market. District Manager Southeast Florida consumer base and communicate to it in a Sincerely, different language. Secondly, the markets May 21, 2003 Pat Delaney population base differs as does its brand Federal Communications Commission awareness and cost structure. May 23, 2003 445 Twelfth St. South, Washington, DC Turn the channel-tune your radio. Your To: Federal Communications Commission, 20554 eyes and ears should convince your mind Honorable Michael Powel To Whom It May Concern: My name is and heart this truly is a distinct market. Marci Neill I am the advertising coordinator Sid Paterson I am Mike Herrera. My experience is for Glendale Nissan/Infiniti. Miami, May 21, 2003 Florida Distributor Coordinator. I have I have been asked to comment on whether To Whom it may concern: I am Gonzalo J. worked in the Florida Market for 17 years in the U.S. Hispanic media market is a separate market, for the purpose of assisting the FCC Gonzalez, Managing Officer at BVK/Meka in the beer Industry. Fourteen years with Miami. My experience in the advertising Anheuser Busch and the last three with in its ongoing review and analysis of the pending merger of Univision industry includes over 15 years working with Presidente U.S.A. Presidente Beer is one of Communications and Hispanic Broadcasting most product categories in the United States, the leading beers in the U.S. that markets to Corporation. Spain and . Hispanic consumers across the country. The first and most obvious example would BVK MEKA is one the leading Hispanic I have been asked to comment on whether be separate languages. From there the list advertising and Public Relations marketing the U.S. Hispanic media market is a separate goes on and on to include the following, firms, and the Hispanic Division of BVK in market. separate location, population, growth rate, Milwaukee, ranked among the top 50 There is ample evidence and factual income level, brand preferences, and cost Advertising Agencies in the United States. corroboration to conclude that the U.S. basis, to name just a few of the reasons why Our current client list for the US Hispanic Hispanic media market is a separate market. as an advertiser it is critical to able to target market include SouthWest Airlines, Sprint Research companies such as Simmons Hispanic media, both TV and Radio as a PCS, Pfizer, South East Toyota, Samsonite, measures media habits, product and service separate market. Samsung and the Florida Anti-Tobacco usage, demographics and psychographics of I hope the Commission will take these campaign among others. Hispanic consumers across the country. factors into consideration when reviewing I have been asked to comment on whether In addition to the Nielsen media research the Univision/HBC merger. the U.S. Hispanic media Market should be is one of the market leaders in terms of Sincerely, considered as a separate market. Not only for providing quality measurement of Hispanic Maric Neill the proven effectiveness of the Spanish TV audiences. Advertising Coordinator. Language in communicating messages, but When Presidente Beer commences its also because of the different media habits and marketing planning and forecast our strategic To Whom It May Concern, my name is cultural relevance of programming, the approach is to identify the key markets Jaime Amoroso, general manager of Toyota of Hispanic media is and should be considered within our Demographic group and separate Manhattan. I’ve been in automotive sales for separate when planning, buying and within each market the hispanic and general over 15 years. evaluating broadcast media. market. This strategic marketing approach is I’ve been asked to give my opinion on the This fact has been proven by numerous used in all of our key markets across the question, ‘‘Do Hispanics in United States research developed by the most prestigious United States. represent a unique market?’’ The question is research companies, such as Nielsen, Roslow I hope the information provided will be been used in the consideration of the Institute, Scarborough, Strategy research, useful in the consideration of the U.S. pending merged between Univion among others. Communications and Hispanic Broadcasting. Hispanic media market as a separate relevant As a result of this, companies that measure The answer is clearly ‘‘YES’’. While we are market. and monitor broadcast media, such as Americans we are also Hispanics with so Sincerely, Nielsen and Arbitron, has adapted their many different things that make us unique Mike Herrera methodology in term of measuring Hispanics such as the foods we eat, our traditions, our Presidente U.S.A. across the country, publishing separate culture and so much more. We have our own To: Ana Figueroa Hispanic books with the results of their separate language with our own tastes, From: Nelson Quintero surveys. preferences and brand awareness. We have I hope the Point of View will be useful in Date: May 22, 2003 our own population with it’s own unique the consideration of the U.S. Hispanic media Re: Hispanic Survey growth rate. In reference to your questions regarding the We have distinct radio, television stations, market as a separate relevant market, and feel Hispanic media survey my personal opinion and programs that appeal specifically to us. free to contact me should you need to further is that Hispanic media should be maintained These stations and programs broadcast discuss this matter. separate from the general market. The directly to our community in our language Sincerely, Hispanic market is a different segment and with it’s own cost base, discreet Gonzalo J. Gonzalez, should be targetted differently. In the beer demographics and targets. It is unique and Managing Officer. industry we face these challenges everyday separate. May 21, 2003 trying to cross over to a complex ethnic As the F.C.C. reviews the Univision/HBC Federal Communications Commission market with such a Latin American influx merger I hope the information highlighted 445 12th Street, SW., Washington, DC 20554 and diversity. We are struggling trying to here will help provide direction and the right convey the same message. decision to this most important question. To Whom It May Concern: It is with great In reference to Radio, the audience of most Sincerely, concern that our firm has approached you listeners are probably working people or Jaime Amoroso regarding the proposed merger between HBC traveling in vehicles. During the most busy and Univision. traffic hours and lunch time most people are June 2, 2003 As a boutique firm in Coral Gables listening to the radio. This is a key time for To Whom It May Concern: I’ve owned and providing counsel in the areas of Advertising, messages and commercials to get across. For operated a radio and TV buying service in event marketing and public relations, we example; lunch hour at any restaurant, bar or New York City for many years. foresee the ramifications of this proposed cafe´ usually has a radio station playing. I I’d like to share my thoughts with you merger. We are a young firm, comprised of think today’s TV viewer’s are looking for concerning the Hispanic market in the hopes individuals who have been active in the specific shows, movies or the nightly news. my comments will be useful in the advertising industry in the South Florida

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66868 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

marketplace for over a decade, particularly in The more I see the situations occur, the I have delivered this or very similar Hispanic media. We live in this market, and more I realize that there are still many people presentations on numerous occasions to a understand the unique elements it’s in South Florida and the U.S. that still don’t broad spectrum of general business and comprised of including how cyclical it is. get it. Hispanic marketing audiences. The most The South Florida market will severely suffer The Hispanic market is more than just a recent was at the Central Florida Hispanic if this merger happens. true and separate market from the general Chamber of Commerce. Our philosophy rests on the shoulders of market. It has several ‘‘sub-markets’’ within I have edited out only my personal innovation and we stand strong in our focus itself. It is more suffice to think that with just (humorous) anecdotes; actually, they were on providing unique and cost effective one campaign, or one spot, or one theory, we the best part. methods for our clients to achieve their can reach the entire Hispanic market. Best regards, marketing goals. However, we believe that Hispanics in the U.S. are truly diverse. South A COUNTRY WITHIN A COUNTRY the uniting of the nation’s number-one Florida alone has possibly the most diverse Spanish-language television operator and the Hispanic market in the country, comprised The U.S. Hispanic market is frequently number-one Spanish-language radio owner mostly of people from the Caribbean, Central referred to as ‘‘a country within a country resembles the Clear Channel model. and South America. * * * larger than Canada * * * the fourth Formulas such as this have truly made it Unquestionably, the same applies to all the largest Spanish speaking country in the difficult for agencies and local businesses Hispanic markets across the U.S. Hispanics hemisphere larger than Peru, Venezuela, such as ours to thrive in a marketplace where have become an important part of our Chile or Ecuador.’’. 42.6 million strong as it relates to placing media, there are very population with their rapid growth, as well (including Puerto Rico), the population is few competitors. as their increasing buying power as expected to grow by more than 1.7 million We are convinced that with such a merger consumers. This is a market with different per year. That’s 100,000 people every three taking effect, many areas of our industry will cultures, ideas, values and customs. weeks or 5,000 every day. be directly affected. Our concerns are the Therefore, it is critical that Hispanics be Hispanic purchasing power exceeded $630 strong negative effects on both the general as considered as a separate market in order to billion in 2002. In and of itself, it represents well as the Hispanic market. We are reach them effectively and allow prospective the 9th largest economy in the world, larger specifically concerned about the business advertisers to communicate with their than the GDP of Brazil, Spain and even practices and methodology that will powerful and evolving segment of our Mexico. All indices and economic ultimately impact the consumer. country. measurement standards reflect growth and We would also like to comment on the increased prosperity. In the decade between Thank you 1979 and 1999, the number of Hispanic issue of whether the Hispanic media market Tony Garcia is a separate one. Our firm firmly believes it families reaching the middle class (defined as is. Just to begin, this is a market that has its President, The Menda Group those earning between $40,000 and $140,000) increased 71.3% to 2.5 million, fully one- own consumer base that possess their own To Whom It May Concern, I’m Helane tastes, brand awareness, brand preferences, third of the total. Naiman. I have worked in media in New The numbers get even more interesting in media, cost basis, population and language. York City for over twenty five years and have How can one ignore the facts listed above? terms of business ownership. According to for the past five years owned my own ad American Demographics Magazine, Including both television and radio, it is agency/buying service, HN Media & evident that this market has its own unique Hispanics now account for the largest share Marketing, Inc. of minority entrepreneurs in the United set of separate characteristics, its own buying I’ve been asked to comment on whether the power, and its own consumer States, owning 40% of all such businesses. U.S. Hispanic media market is a separate The Census Bureau’s last economic census psychographics. market for the purpose of assisting the F.C.C. We implore the Commission to consider reported 1.2 million Hispanic owned in its ongoing review and analysis of the businesses with aggregate revenue in excess the ample evidence aforementioned. My firm pending merger between Univision could not feel more strongly about this of $1.86 billion. The 2002 estimate put the Communications and Hispanic Broadcasting figure at 2.3 million with $380 billion in matter. We respectfully seek your assistance Corporation. In my opinion it certainly is. in protecting the industry comprised of sales. In 2001, the census also reported Here are just a few reasons why. The Hispanic labor-force participation at 80.4% agencies and advertisers alike who realize Hispanic population has separate tastes. It how critical this matter is and how this (FYE 2000), higher than non-Hispanic white differs in brand awareness with a uniquely males as a whole proposed merger will affect the future of our different consumer base. Hispanics in the industry. We trust in the judgment of the It is evident that even official agencies United States have their own media. The consider this market a discrete entity within Commission and rely on its plight to protect market includes both radio and television the overall public’s interest. Please take our the larger marketplace measured and stations that broadcast in the Spanish reported accordingly. And while other plea into consideration. If need be, our firm language. is at your disposition as it relates to the minority markets are similarly measured in a I hope this information is useful to the number of areas, the Hispanic market stands Commission’s consideration of the U.S. Commission in their consideration of this Hispanic media market as a autonomous alone as a self-contained, differentiated, issue. As the FCC reviews the question of ‘‘country-like’’ entity within U.S. borders; market and its review of the Univision/HBC whether Hispanics in the United States are a merger. one from which specialized disciplines, separate market the answer is clearly-yes. professions, governmental institutions, NGOs Sincerely, Yours Truly, and even foreign policy initiatives, have Liza M. Santana, Helane Naiman, arisen and will continue to arise well into the President, Creativas Group Inc. President foreseeable future. This is not a matter of Note: The letter dated May 27, 2003 from opinion. It is a matter of fact extremely well May 22, 2003 Accentmarketing was not able to be grounded in logic, as we shall see: To Whom It May Concern: As an published in the Federal Register but a copy 1. Let’s consider the other two large advertising agency in the South Florida can be obtained from the U.S. Department of minority segments in the United States, market for over 7 years, and as an advertising Justice, 601 D Street, NW., Room 10–013, African-Americans (excluding Haitian- professional for over 13 years, I am always Washington, D.C. 20530 or you may call and Americans) and Asian Americans. African- asked the same question from many of my request a copy at (202) 514–2558. Americans speak English almost exclusively. advertisers: ‘‘How can I reach the Hispanic May 23, 2003. There are few direct linkages to African market?’’ countries of origin. Non- The question would seem to have a simple Mr. Raul Alarcon Jr. may easily communicate and participate in answer: ‘‘Just through some budget dollars to Chairman, Spanish Broadcasting System, this sub-segment at will. They are tied to the a couple of Hispanic stations, translate our 2601 South Bayshore Drive, Penthouse II, mainstream culture by language if not by current spot (some advertisers actually use Coconut Grove, FL 33133 color. their English spot in Spanish language Dear Raul, enclosed is a synopsis of my 2. The Asian-American segment is stations), and go with it!’’ position paper on the U.S. Hispanic market. composed by a multiplicity of cultures

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00073 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66869

divided by language—Chinese (Mandarin that they were wrong about assimilation diversity purposes. The proposed Univision/ and Cantonese), Japanese, Korean, (which did not and will not take place), were HBC merger threatens to create substantial Vietnamese, Hindi, Bengali, Urdu, Malay, wrong to remain intransigently monolingual market power in numerous geographic Punjabi—the influence and economic as if it were a badge of honor and thus, with markets for Spanish-language broadcasting to advantages (cost-effectiveness) that spring very few exceptions and these only in the the detriment of advertisers, consumers, from critical mass are elusive if not multi-national arena, incapable of creating competition, and diversity. This letter impossible. Therefore, other than grassroots Hispanic divisions organically. Ultimately, submits data demonstrating the severity of marketing or media outlets serving small they had to buy the agencies. Most were enclaves, any Pan-Asian network or national motivated by profit potential others to keep that threat in the ten metropolitan areas with print vehicle would be either highly the market in check and under control. the largest Hispanic populations. fragmented in a multiplicity of languages or 6. The increasing acceptance of Mexican Attached hereto is a chart for each of the require English as the common denominator. Matriculas, the strengthening of Radio top ten Spanish-language broadcast markets 3. Language is the single most important Marti’s signal, NAFTA and the proposed displaying the market share of each characteristic of culture and Hispanics in the FTAA, point to Hispanic interests participant in terms of combined television United States are united by a common influencing the national agenda well beyond and radio advertising revenues for 2002.1 In language traced to Spanish colonizers the Congressional Hispanic Caucus. This is seven of the top ten markets, the combined regardless of whether these are viewed as understandable as Hispanics represent the ruthless conquistadors (Mexico) or brothers entity’s (Univision + HBC) post-merger country’s largest pool of bilingual, market share will equal or exceed 60%, and from the mother country (Cubans). If this transnational citizens. It may be a small in two of the top ten markets the combined were not the case, neither national broadcast percentage of the vast United States of networks nor national print media would be America, but a critical component of the entity’s market share will exceed 70%. viable business models. This isn’t to say that country’s hemispheric—perhaps global— Indeed, in San Antionio, the combined entity there aren’t English dominant Latinos, but aspirations. A country within a country will control a striking 80% of the market. rather that for marketing and indeed. Only in Brownsville/McAllen (13%) and communications purposes we include them New York (48%) will the combined entity in the mainstream universe just as we Exhibit B exclude non-Spanish speakers from the have a market share below 50%. When , 2003 Hispanic consumer pool. Spanish dominant Entravision’s market share is included To Whom it May Concern: I am Julio Latinos then, by necessity, must rely on (Univision + HBC + Entravision), the Amparo. I have worked in the Hispanic Spanish language media even to exercise combined entity’s market share ranges from market as an owner of an independent their right to vote; bilingual Latinos may 48% in new York to 84% in Phoenix. For advertising agency for over 15 years. choose either language based on content or convenience, the table below summarized the self-identification. Considering that Latinos I have been asked to comment on the pending merger between Univision distribution of revenue shares for the are basically absent from general market combined entity, with and without media, being depicted as less than 2% of all Communications and Hispanic Broadcasting Entravision. As illustrated by the data in this characters (while more than 12% of the Corporation. An important question the population) and often in the most negative F.C.C. is facing is whether or not the U.S. table, the combined entity would account for roles, bilingual Hispanics are practically Hispanic market is separate market. a large majority of advertising revenues in 8 compelled to turn to Spanish language media First, we speak a different language. We (or 9) of the top ten markets. to see and/or hear themselves. have our own consumer base, our own and 4. This cultural phenomenon known as separate tastes. As an owner of an ad agency I can tell you Hispanics have their own brand Hispanic-America, and its need for in- 1 awareness for our own products. Our The charts were prepared using the following language communications that respects and methodology: The advertising data for both population growth is different, the cost embraces our multiracial identities, musical broadcast radio and broadcast television were structure of media is separate—we are a preferences and folkloric richness created the obtained from BIA, In., through its Media Access separate consumer base. Hispanic advertising industry. The Pro software (current as of June 5, 2003). BIA The Hispanic Media market—radio and TV Association of Hispanic Advertising provides station-level revenue and ownership data Agencies was organized in recognition that combined—is a separate and distinct market. for more than 13,000 radio stations and nearly 2,000 ours is a marketing sector that could not and Listen and you will hear with your ears we commercial television stations in the United States. would not be well served by general market are a separate market. Revenues from BIA are estimated using data from entities; the very same who for more than 30 I hope my comments will be useful in the its proprietary survey of station managers and years had been predicting with almost Commission’s consideration of the U.S. owners. For radio stations, BIA reports information evangelical fervor our assimilation and Hispanic media market as a separate relevant on station format. These data were supplemented demise. The truth is that Hispanic entity and in it review of the Univision/HBC with information from the 2002 Television and advertising and media professionals merger. Cable Factbook, 2002 U.S. Hispanic Market (a constitute a unique business specialty. As Julio Ampara, publication of Strategy Research Corporation), and managers, we must have as thorough an President. various internet websites, including understanding of the disciplines as our June 11, 2003 www.100000watts.com. monolingual, general market counterparts Marlene H. Dortch First, all of the radio and television stations and communicate in English with our clients, Secretary, Federal Communications broadcasting to the ten metropolitan areas with the bankers, the IRS and the 21 year old brand Commission, 445 12th Street, SW., largest Hispanic populations were identified. Using manager who has never traveled outside of Washington, DC 20554 information from BIA as well as internet-based Indiana, yet transcreate, transform, interpret research, each station’s language format was Re: Applications for Transfer of Control of and connect with our consumers in Spanish, determined. A radio station was classified as a Hispanic Broadcasting Corp., and Certain the language most likely to produce the sales Spanish-language station if a portion of the BIA Subsidiaries, Licensees of KGBT (AM, and economic benefits sought by our clients. format description was Spanish )BIA reports the Harlingen, Texas et al. (Docket No. MB 02– ‘‘Compre nuestro auto, nuestro jugo y traiga current format, which may not necessarily su dinero a nuestro banco.’’ It’s the American 235, FCC File Nos. BTC–20020723ABL, et correspond to the station’s format in 2002, although way. Consumer spending is the backbone of al.) we believe relevant changes, if any, to be minimal) our economy. And let’s be realistic, the Dear Ms. Dortch: Spanish Broadcasting or, alternatively, if it could be determined that a mainstream population base is experiencing System, Inc. (‘‘SBS’’) has submitted several portion of the station’s programming was in negative birth rates. All U.S. population filings for the record of this proceeding Spanish. Similarly, for television stations, a station growth is directly attributable to minority demonstrating that Spanish-language media was classified as Spanish-language if a portion of and immigrant sub-segments. The Census does not compete with English-language the station’s programming was in Spanish. Because says so. media. In other words, Enligh-language and all Univision television stations broadcast in 5. The wave of Hispanic agency Spanish-language broadcasting constitute Spanish, this decision rule provides a conservative acquisitions by general market firms shows separate markets for competition and estimate of Univision’s revenue share.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00074 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66870 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

CUMULATIVE DISTRIBUTION OF 2002 merger, the combined entity will have the SPANISH-LANGUAGE BROADCAST BROADCAST ADVERTISING REVENUE power to insist that Spanish-language ADVERTISING REVENUES, 2002 advertisers who wish to advertise through SHARES* both radio and television purchase time from [New York: Hispanic Population of 4.0 million] both Univision and HBC rather than from the Univision Univision + combined entity’s rivals. Such difficult-to- Percent Share + HBC HBC + detect and subtle tying arrangements or Entravision refusals to deal—realistic possibilities here— Univision ...... 41 impair competition. See, e.g., Lorain Journal SBS ...... 28 >80% ...... 1 Co. v. U.S., 342 U.S. 143 (1951). The Telemundo ...... 18 >70% ...... 2 5 resulting harm to competitors, including ≥60% ...... 7 7 HBC ...... 7 SBS, that is sure to follow will not only harm Other ...... 6 >50% ...... 8 9 advertisers, but also will impair diversity. >40% ...... 9 10 To meet its obligations under the Notes: Advertising revenue-based satellite * Numbers may differ from those obtained Communications Act, the FCC must program services that also offer Spanish-lan- from the charts due to rounding. undertake a detailed analysis of diversity and guage programming include services such as competition specific to a Spanish-language Galavision Cable Network, MTV Latin America These high market shares—including media markets implicated by this merger. In and Viva Television Network. above 70% in several markets—demonstrate addition to the materials submitted last week Sources: 2002 BIA, Inc.; 2002 Television that the merger will enable the new and filed today, SBS intends to file shortly and cable Factbook; 2002 U.S. Hispanic Mar- ket, Strategy Research Corporation. Univision/HBC to exercise substantial market with the Commission further information or monopoly power to the detriment of both demonstrating the severity of the threat to Spanish-speaking consumers and advertisers competition and diversity presented by the SPANISH-LANGUAGE BROADCAST who seek to reach that audience. For ‘‘a share proposed merger. ADVERTISING REVENUES, 2002 above 70% is usually strong evidence of Respectfully submitted, [Miami: Hispanic Population of 1.7 million] monopoly power’’ and ‘‘a share between 50% / s / Philip L. Verveer and 70% can occasionally show monopoly Philip L. Verveer power.’’ Broadway Delivery Corp. v. United Sue D. Blumenfeld Percent Parcel Service of Am., Inc., 651 F.2d 122, 129 Michael G. Jones (2nd Cir. 1981). Even a share below 50% can David M. Don Univision ...... 35 support a finding of monopoly power when WILLKIE FARR & GALLAGHER, 1875 K Telemundo ...... 20 other indicia of such power—such as the Street, NW., Washington, DC 20006, HBC ...... 20 high entry barriers present here—exist. See Telephone: (202) 303–1000 SBS ...... 15 id. The consequences of a monopoly in and Other ...... 9 Spanish-language broadcasting is not only Bruce A. Eisen Entravision ...... 0.20 higher rates for advertisers, but also a Allan G. Moskowitz substantial loss in diversity of voices. Notes: Advertising revenue-based satellite KAYE SCHOLER, LLP, 901 15th Street, NW., Moreover, where, as here, the combined program services that also offer Spanish-lan- Suite 1100, Washington, DC 20005 entity will control over 40% in all or guage programming include services such as Attorneys for Spanish Broadcasting System virtually all of the major relevant markets, Galavision Cable Network, MTV Latin America Inc. and Viva Television Network. diminished economic performance is likely. Sources: 2002 BIA, Inc.; 2002 Television See FTC v. Swedish match, 131 F. Supp. 2d cc: Chairman Michael K. Powell, Commissioner Kathleen Q. Abernathy, and cable Factbook; 2002 U.S. Hispanic Mar- 151, 166 (D.D.C. 2000) (‘‘Without attempting ket, Strategy Research Corporation. to specify the smallest market share which Commissioner Michael J. Copps, would still be considered to threaten undue Commissioner Kevin J. Martin, PANISH ANGUAGE ROADCAST concentration, we are clear that 30% presents Commissioner Jonathan S. Adelstein, S -L B a threat.’’ quoting United States v. Susan M. Eid, Stacy R. Robinson, Jordan B. ADVERTISING REVENUES, 2002 Philadelphia National Bank, 374 U.S. 321, Goldstein, Catherine Crutcher Bohigian, [Chicago: Hispanic Population of 1.6 million] 364 (1963)). In sum, the market shares shown Johanna Mikes, W. Kenneth Ferree, David Brown, Scott R. Flick, Counsel for here present a real risk of anticompetitive Percent harm to Spanish-language advertisers, as well Univision Communications, Inc., Roy R. Russo, Counsel for Hispanic Broadcasting as a critical loss of diversity to Spanish- Univision ...... 33 speaking Americans in these markets. Corp., Harry F. Cole, Counsel for Elgin FM Limited Partnership HBC ...... 30 Moreover, the merger threatens both SBS ...... 22 competition and diversity whether or not Telemundo ...... 8 Spanish-language television and radio PANISH ANGUAGE ROADCAST compete in the same market. The reason is S -L B Entravision ...... 4 that the merger gives Univision/HBC the ADVERTISING REVENUES, 2002 Other ...... 4 power to exclude competition even if [Los Angeles: Hispanic Population of 7.0 Notes: Advertising revenue-based satellite Spanish-language TV and radio belong in million] program services that also offer Spanish-lan- different markets. First, the Univision/HBC guage programming include services such as merger would raise already high entry Percent Galavision Cable Network, MTV Latin America barriers into Spanish-language radio. and Viva Television Network. Advertising on Spanish-language TV is Univision ...... 41 Sources: 2002 BIA, Inc.; 2002 Television important to a Spanish-language radio HBC ...... 19 and cable Factbook; 2002 U.S. Hispanic Mar- station’s ability to obtain significant Entravision ...... 5 ket, Strategy Research Corporation. audience. Indeed, several of SBS’s stations SBS ...... 6 only succeeded because of risky and Telemundo ...... 13 SPANISH-LANGUAGE BROADCAST expensive television advertising campaigns. Other ...... 15 ADVERTISING REVENUES, 2002 However, after its acquisition of HBC, Univision—which dominates Spanish- Notes: Advertising revenue-based satellite [Houston: Hispanic Population of 1.6 million] language television—will have an incentive program services that also offer Spanish-lan- guage programming include services such as Percent to refuse to deal with, or discriminate Galavision Cable Network, MTV Latin America against, Spanish-language radio competitors and Viva Television Network. (including SBS) who seek to advertise Sources: 2002 BIA, Inc.; 2002 Television Univision ...... 32 through Univision (and other properties) in and cable Factbook; 2002 U.S. Hispanic Mar- HBC ...... 42 order to advantage HBC. Second, after the ket, Strategy Research Corporation. Other ...... 19

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00075 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66871

SPANISH-LANGUAGE BROADCAST AD- SPANISH-LANGUAGE BROADCAST AD- this case, and that leads to the conclusion VERTISING REVENUES, 2002—Con- VERTISING REVENUES, 2002—Con- that the transaction is contrary to the public interest. He made two specific points. tinued tinued First, Mr. Schwartzman discussed the [Houston: Hispanic Population of 1.6 million] [San Antonio: Hispanic Population of 1.2 extraordinary and insuperable barriers that million] any new entrant would face in trying to Percent compete with the combined Univision/HBC Percent entity. Unlike English language markets, a Telemundo ...... 6 competitor would face great difficulty in Other ...... 3 making the audience aware of its service, as Notes: Advertising revenue-based satellite Univision would control the principal means program services that also offer Spanish-lan- Notes: Advertising revenue-based satellite program services that also offer Spanish-lan- of promoting and advertising a new radio guage programming include services such as station, i.e., Spanish language broadcasting. Galavision Cable Network, MTV Latin America guage programming include services such as and Viva Television Network. Galavision Cable Network, MTV Latin America Moreover, Clear Channel, which would be Sources: 2002 BIA, Inc.; 2002 Television and Viva Television Network. one of the largest shareholders of the and cable Factbook; 2002 U.S. Hispanic Mar- Sources: 2002 BIA, Inc.; 2002 Television combined companies, is the largest owner of ket, Strategy Research Corporation. and cable Factbook; 2002 U.S. Hispanic Mar- outdoor advertising, which is the second ket, Strategy Research Corporation. most important advertising medium used for SPANISH-LANGUAGE BROADCAST this purpose. SPANISH-LANGUAGE BROADCAST Mr. Schwartzman then turned to how the ADVERTISING REVENUES, 2002 ADVERTISING REVENUES, 2002 Spanish language market should be treated [San Francisco/San Jose: Hispanic Population [Phoenix: Hispanic Population of 1.0 million] from a diversity perspective. He noted that of 1.4 million] under the FCC’s 1981 radio deregulation decision, broadcasters were freed from the Percent Percent obligation to serve every enumerated Univision ...... 47 audience segment in their community. They Univision ...... 48 HBC ...... 22 were, however, expected to demonstrate that Other ...... 19 Entravision ...... 15 they have met the problems needs and Entravision ...... 17 Telemundo ...... 9 interests of whatever niche audience segment HBC ...... 14 Other ...... 7 they might have chosen to serve. Plainly Telemundo ...... 2 then, the Commission treated Hispanic other Notes: Advertising revenue-based satellite minority communities as distinct for this Notes: Advertising revenue-based satellite program services that also offer Spanish-lan- purpose as well. program services that also offer Spanish-lan- guage programming include services such as In response to questioning from Ms. Eid, guage programming include services such as Galavision Cable Network, MTV Latin America Mr. Schwartzman explained that he thought Galavision Cable Network, MTV Latin America and Viva Television Network. Sources: 2002 BIA, Inc.; 2002 Television it was entirely logical for the Commission to and Viva Television Network. conduct an analysis of the impact of a Sources: 2002 BIA, Inc.; 2002 Television and cable Factbook; 2002 U.S. Hispanic Mar- ket, Strategy Research Corporation. transaction on particular segments of the and cable Factbook; 2002 U.S. Hispanic Mar- community while still including the same ket, Strategy Research Corporation. SPANISH-LANGUAGE BROADCAST stations in voice counts and other analyses of the entire market. Thus, the question of how SPANISH-LANGUAGE BROADCAST ADVERTISING REVENUES, 2002 many stations a particular broadcaster might ADVERTISING REVENUES, 2002 [Brownsville/McAllen: Hispanic Population of own in a market would be a separate issue 1.0 million] [Dallas/Ft. Worth: Hispanic Population of 1.3 from whether it held excessive power within million] the Spanish language submarket. Percent Sincerely, Percent Andrew Jay Schwartzman Entravision ...... 45 President and CEO Other ...... 30 Univision ...... 47 HBC ...... 13 cc. Susan Eid HBC ...... 22 Telemundo ...... 12 July 11, 2003 Telemundo ...... 20 Entravision ...... 8 Notes: Advertising revenue-based satellite W. Kenneth Ferree, Esquire Chief, Media Bureau, Federal Other ...... 3 program services that also offer Spanish-lan- guage programming include services such as Communications Commission, 445 12th Notes: Advertising revenue-based satellite Galavision Cable Network, MTV Latin America Street, NW., Room 3–C740, Washington, program services that also offer Spanish-lan- and Viva Television Network. DC 20554 guage programming include services such as Sources: 2002 BIA, Incl; 2002 Television and cable Factbook; 2002 U.S. Hispanic Mar- Re: Applications for Transfer of Control of Galavision Cable Network, MTV Latin America Hispanic Broadcasting Corp., and Certain and Viva Television Network. ket, Strategy Research Corporation. Subsidiaries, Licensees of KGBT(AM), Sources: 2002 BIA, Inc.; 2002 Television July 9, 2003 Harlingen, Texas et al. (Docket No. MB 02– and cable Factbook; 2002 U.S. Hispanic Mar- Marlene H. Dortch ket, Strategy Research Corporation. 235, FCC File Nos. BTC–20020723ABL et Secretary, Federal Communications al.). Commission, TW–A325, 445 12th Street, Dear Ms. Dortch: The National Hispanic SPANISH-LANGUAGE BROADCAST SW., Washington, DC 20554 Policy Institute, Inc. (‘‘NHPI’’) hereby replies ADVERTISING REVENUES, 2002 Re: Notice of Ex parte Presentation, MB 02– to the June 25, 2003 letter filed by Univision [San Antonio: Hispanic Population of 1.2 235 Communications, Inc. (‘‘Univision’’). In its million] Dear Ms. Dortch: On July 8, Andrew Jay letter Univision again restates its contention Schwartzman of the Media Access Project that, if the proposed merger with Hispanic Percent met with Susan Eid, Legal Advisor to the Broadcasting Corporation (‘‘HBC’’) is granted, Chairman to discuss the proposed transfer of Univision’s interest in Entravision Univision ...... 43 control of Hispanic Broadcasting Communications Corporation (‘‘Entravision’’) HBC ...... 37 Corporation. will be non-attributable. SBS ...... 10 Mr. Schwartzman took the position that the In arguing for a ‘‘bright-line’’ attribution Telemundo ...... 7 Commission should treat Spanish language test, Univision claims that it demonstrated in radio as a separate market for purposes of a December 9, 2002 letter to the Media

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00076 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66872 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Bureau that its interest in Entravision is has refused to provide this information. Univision’s relationship with Entravision below the 33% threshold equity/debt plus Without knowing the extent of equity, and is significantly different from previous (‘‘EDP’’) ratio. In fact, Univision failed to the extent of debt Univision, its officers and relationships that the FCC has found to be make any such showing. directors hold in Extravision, the FCC cannot non-attributable. For this reason, the cases Univision’s December 9, 2002 letter was determine whether Univision complies with Univision cites in support of its claim that its filed in response to a , 2002 the EDP rule. interest in Entravision, will be Commission request for further information. Univision’s failure to produce information, nonattributable are inapposite. The Commission was responding to a NHPI which is easily obtained and uniquely within Univision debt and equity interests in showing, that Entravision had outstanding its control, permits the Commission to draw Entravision have historically been debts owed to Univision. Univision had the negative conclusion that if the attributable interest. Univision has a long previously represented to the Commission information were produced it would show relationship with Entravision as a business that ‘‘Univision has no debt interest in that Univision, post-merger, will still have an partner, program supplier, creditor and Entravision.’’ 1 The Commission ordered attributable interest in Entravision. Tendler financial backer. In return for Univision’s Univision to ‘‘explain the origin and nature v. Jaffe, 203 F.2d 14, 19 (D.C. Cir. 1953) support, Entravision has granted Univision of such accounts.’’ It further ordered (‘‘The omission by a party to produce significant rights, including the right to Univision to, ‘‘[p]rovide an audited financial relevant and important evidence of which he appoint two directors to its board and the statement to support any factual assertion, has knowledge, and which is peculiarly right to influence its core operations. As and a detailed showing demonstrating within his control, raises the presumption Entravision’s SEC 10K acknowledges, compliance with the Equity/Debt Plus that if produced the evidence would be ‘‘Univision has significant influence over our Rule.’’ 2 unfavorable to his cause.’’); International business.’’ Univision proposes to convert its In response to the Commission’s letter, Union, UAW v. National Labor Relations voting shares into non-voting shares and to Univision submitted certain documentation, Board, 459 F.2d 1329, 1336 (D.C. Cir. 1972) give up its rights to appoint directors, to which it claimed showed that it was in (‘‘the failure to bring before the tribunal some Entravision’s board. This, however, will not compliance with the Commission’s EDP rule. circumstance, document, or witness, when change the fundamental well-established However, the evidence Univision provided either the party himself or his opponent relationship between Univision and was incomplete and not audited.3 As NHPI claims that the facts would thereby be Entravision. stated in its December 16, 2002 letter: elucidated, serves to indicate, as the most In none of the case Univision sites, did the ‘‘Univision has again misled the natural inference, that the party fears to do Commission permitted an applicant to Commission and has failed to be forthcoming so, and this fear is some evidence that the convert a long-standing attributable and candid in its representations to the * * * document, if brought, would have relationship with another party into a non- Commission. * * * Entravision’s DEF 14A exposed facts unfavorable to the party.’’) attributable interest. For example, General shows that ‘‘Andrew Hobson, Executive Vice (quoting J. Wigmore, Evidence § 284, 3rd ed. Electric’s purchase of Telemundo fully President of Univision, holds 211,136 Class 1940); United States v. Robinson, 233 F.2d complied with the multiple ownership rules A shares of Entravision. The DEF 14A also 517, 519 (D.C. Cir. 1956) (‘‘[u]nquestionably without the need to convert previously held shows that Michael D. Wortsman, Co- the failure of a defendant in a civil case to attributable interests into non-voting, non- President of Univision Television Group, testify or offer other evidence within his attributable interests.5 If, for example, Inc., holds 56,136 Class A shares of ability to produce and which would explain General Electric’s proposed purchase of Entravision. or rebut a case made by the other side, may, Telemundo did not comply with the FCC’s ‘‘Entravision’s DEF 14A reports stock in a proper case, be considered a multiple ownership rules and General ownership of (1) persons or entities known circumstance against him and may raise Electric proposed to convert its attributable to be the beneficial owners of more than 5% presumption that the evidence would not be interest in NBC into a non-voting interest, of the outstanding shares of stock, (2) each favorable to his position’’); Washoe Shoshone and further, if the FCC had permitted such of its directors, and (3) certain key executives Broadcasting, 3 FCC Rcd 3948, 3952–53 (Rev. a transaction, then Univision would have a of the company. Mr. Hobson and Mr. Bd. 1988); Thornell Barnes v. Illinois Bell case on point. Wortsman’s share holdings were reported Telephone Co., 1 FCC 2d 1247, 1274 (Rev. Univision’s letter has little to say about its because, at the time, they were members of Bd. 1965). Univision’s failure to produce plan to retain the exclusive right to make Entravision’s board of directors. Entravision’s evidence permits the Commission to include national sales on behalf Entravision. Section DEF 14A does not require it to report shares that Univision’s interest in Entravision is 73.658(i) prohibits a television network from held by Univision insiders unless their attributable as a matter of law. representing individual stations, affiliated individual holdings exceed 5% of the Univision does not meet the FCC’s bright- with the network, for the sale of non-network outstanding shares. Thus, in addition to Mr. line EDP test. Even if Univision could time. In the 1970s, Univision’s predecessor Hobson and Mr. Wortsman, it is quite demonstrate that its interest in Entravision is entity argued that, as fledgling network, a possible that other Univision officers and below the 33% debt/equity threshold, its waiver of this rule was required to enhance directors hold Entravision shares. There may relationship with Entravision is such that it the development of Spanish language also be other Entravision debts owed to would still be able to continue to exert television.6 Univision’s letter merely states Univision that are not reported in SEC significant influence over key licensee that Telemundo was given the ‘‘exact same filings. Had an independent audit been deicsions. As the Commission has said: waiver.’’ Here again the situation is quite conducted, an honest and complete answer ‘‘In adopting the EDP rule, we affirm our different. In Telemundo II, there was no issue could have been provided.’’ tentative conclusion * * * that there is the concerning Telemundo’s inappropriate For the Commission to make a bright-line potential for certain substantial investors or exercise of control over its affiliates. In this determination concerning compliance with creditors to exert significant influence over case, the central question is, will Univision’s the EPD rule, it must know the percentage of key licensee decisions, even through they do exclusive right to make national sales on equity and debt a party holds. In this case, not hold a direct voting interest * * * which behalf of Entravision give Univision the right the commission knows that Entravision has may undermine the diversity of voices we to influence Entravision’s core operations, outstanding debts owed to Univision. What seek to promote. They may, through their especially its radio station holdings? the Commission does not know, is the contractual rights and their ongoing right to Univision’s letter cites, with approval, the amount and percentage of Entravision’s debt communicate freely with the licensee, exert Commission’s statement, ‘‘[t]he mass media owed to Univision. Also unknown, is how as much, if not more, influence or control attribution rules seek to identify those many shares of Entravision’s stock are held over some corporate decisions as voting interests in or relationships to licensees that by Univision’s officers and directors. See, equity holders whose interests are confer on their holders a degree of influence Section 73.3555, note 2. Here again Univision attributable.4’’ or control such that the holders have a

1 Univision Opposition to Petition to Deny, at p. 4 Review of the Commission’s Regulations 5 Telemundo Communications, Group, Inc., 17 11. Governing Attribution of Broadcast and Cable/MDS FCC Rcd 6958 (2002). Telemundo II). 2 FCC letter dated November 29, 2002. Interests, Report and Order, 14 FCC Red 12559, 6 Amendment of § 73.658(i) of the commission’s 3 Univision letter dated December 9, 2003. 12582–3 (1999) (‘‘Attribution Order’’). Rules, 5 FCC Rcd 7280 (1990).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66873

realistic potential to affect the programming Commissioner Michael J. Copps, adjustment assistance under Title II, decisions of licensees or other core operating Commissioner Kevin J. Martin, Chapter 2, of the Act. The investigations functions.’’ 7 The FCC, while granting a Commissioner Jonathan S. Adelstein, will further relate, as appropriate, to the waiver of the national spot sales rule to David Brown, Esquire (Media Bureau, determination of the date on which total Univision and Telemundo, maintained the FCC), Barbara Kreisman, Esquire (Video rule for other, non-Spanish language Division, Media Bureau, FCC), Lawrence or partial separations began or television networks. The FCC reasoned that N. Cohn, Esquire, (Counsel for The threatened to begin and the subdivision without the rule networks would be able to Shareholders of Hispanic Broadcasting of the firm involved. exert undue influence over affiliate Corp.), Scott R. Flick, Esquire (Counsel for The petitioners or any other persons programming decisions. The right to sell Univision Communications, Inc.), Harry F. showing a substantial interest in the Cole, Esquire (Counsel to Elgin FM Limited national spot advertising gives Univision subject matter of the investigations may significant rights to influence Entravision, Partnership) request a public hearing, provided such including, as the Commission has stated, the [FR Doc. 03–28791 Filed 11–20–03; 8:45 am] power to influence programming decisions. request is filed in writing with the At a minimum, the FCC should forbid BILLING CODE 4410–11–M Director, Division of Trade Adjustment Univision from making national spot sales on Assistance, at the address shown below, behalf of Entravision, if the proposed merger not later than December 8, 2003. is approved. DEPARTMENT OF LABOR Interested persons are invited to Converting Univision’s voting shares in Entravision into non-voting shares will not Employment and Training submit written comments regarding the fundamentally change the existing Administration subject matter of the investigations to relationship. Entravision has been and will the Director, Division of Trade continue to be dependent on Univision for it Investigations Regarding Certifications Adjustment Assistance, at the address continued survival. Univision, through its of Eligibility To Apply for Worker shown below, not later than December control of national sales and it absolute right Adjustment Assistance 8, 2003. to grant or deny new network affiliations, will be able to control financial decisions, Petitions have been filed with the The petitions filed in this case are programming and personnel at Entravision Secretary of Labor under section 221(a) available for inspection at the Office of owned radio stations, thus ensuring that of the Trade Act of 1974 (‘‘the Act’’) and the Director, Division of Trade Entravision’s radio stations will not compete are identified in the Appendix to this Adjustment Assistance, Employment with HBC’s radio stations. Such influence notice. Upon receipt of these petitions, and Training Administration, U.S. will diminish diversity and stifle Department of Labor, Room C–5311, 200 competition, two key aspects of the FCC local the Director of the Division of Trade Adjustment Assistance, Employment Constitution Avenue, NW., Washington, ownership rules. DC 20210. Sincerely, and Training Administration, has Arthur, Belendiuk instituted investigations pursuant to Signed at Washington, DC, this 17th day of Counsel to National Hispanic Policy section 221(a) of the Act. November 2003. Institute, Inc. The purpose of each of the Timothy Sullivan, cc: Chairman Michael K. Powell, investigations is to determine whether Director, Division of Trade Adjustment Commissioner Kathleen Q. Abemathy, the workers are eligible to apply for Assistance.

APPENDIX [Petitions instituted between 11/03/2003 and 11/07/2003]

Date of institu- Date of peti- TA–W Subject firm (petitioners) Location tion tion

53,405 ...... Authentic Fitness Corp. (Wkrs) ...... Los Angeles, CA ...... 11/03/2003 10/16/2003 53,406 ...... F/V Patricia Diann (Comp) ...... Cordova, AK ...... 11/03/2003 10/13/2003 53,407 ...... Alice Manufacturing (Wkrs) ...... Easley, SC ...... 11/03/2003 10/28/2003 53,408 ...... Elastic Corp. of America (Comp) ...... Woolwine, VA ...... 11/03/2003 10/21/2003 53,409 ...... Delta International Machinery (Comp) ...... Tupelo, MS ...... 11/03/2003 10/11/2003 53,410 ...... Nidec America Corporation (MA) ...... Canton, MA ...... 11/03/2003 10/28/2003 53,411 ...... Cognati Industries (GMP) ...... Bluffton, IN ...... 11/03/2003 10/08/2003 53,412 ...... Fort Payne Socks, Inc. (Comp) ...... Fort Payne, AL ...... 11/03/2003 10/29/2003 53,413 ...... MTD Southwest, Inc. (Comp) ...... Chandler, AZ ...... 11/03/2003 10/31/2003 53,414 ...... DuPont Photomasks, Inc. (Wkrs) ...... Danbury, CT ...... 11/03/2003 10/31/2003 53,415 ...... Elementis Chromium LP (Wkrs) ...... Corpus Christi, TX ...... 11/03/2003 05/02/2003 53,416 ...... Wolverine Pattern and Machine (IAM) ...... Saginaw, MI ...... 11/03/2003 10/31/2003 53,417 ...... National Pattern, Inc. (IAM) ...... Saginaw, MI ...... 11/03/2003 10/31/2003 53,418 ...... Springfield LLC (Comp) ...... Gaffney, SC ...... 11/03/2003 10/27/2003 53,419 ...... Encee Inc. (Wkrs) ...... Eden, NC ...... 11/03/2003 10/24/2003 53,420 ...... Surgical Specialties Corp. (Wkrs) ...... Ada, OK ...... 11/04/2003 11/04/2003 53,421 ...... Seamless Textiles (PR) ...... Humacao, PR ...... 11/04/2003 10/10/2003 53,422 ...... United Airlines (Wkrs) ...... Elk Grove, IL ...... 11/04/2003 11/03/2003 53,423 ...... Drexel Heritage Furniture Industries (Wkrs) ... Hildebran, NC ...... 11/04/2003 10/24/2003 53,424 ...... Clore Automotive (MN) ...... Eden Prairie, MN ...... 11/04/2003 10/30/2003 53,425 ...... Trane and American Standards Co’s (MN) .... White Bear Lake, MN ...... 11/04/2003 10/30/2003 53,426 ...... Neutronics, Inc. (Comp) ...... Phoenix, AZ ...... 11/04/2003 10/27/2003 53,427 ...... Puzzle-Craft (MN) ...... Wabasso, MN ...... 11/04/2003 10/28/2003 53,428 ...... Hawkeye Group (Wkrs) ...... Mediapolis, IA ...... 11/04/2003 10/23/2003 53,429 ...... R. Leon Williams Lumber Co. (ME) ...... Clifton, ME ...... 11/04/2003 10/23/2003

7 Univision, June 25, 2003 letter citing the Attribution Order at p. 12560, (emphasis added.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66874 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

APPENDIX—Continued [Petitions instituted between 11/03/2003 and 11/07/2003]

Date of institu- Date of peti- TA–W Subject firm (petitioners) Location tion tion

53,430 ...... EMF Corporation (Wkrs) ...... Burkesville, KY ...... 11/04/2003 10/21/2003 53,431 ...... Sweetwater Apparel, Inc. (Wkrs) ...... Collinwood, TN ...... 11/04/2003 10/31/2003 53,432 ...... Millennium A R Haire (Comp) ...... Thomasville NC ...... 11/04/2003 10/28/2003 53,433 ...... TT Electronics/IRC, Inc. (Comp) ...... Boone, NC ...... 11/04/2003 10/28/2003 53,434 ...... Sara Lee Coffee and Tea (OK) ...... Oklahoma City, OK ...... 11/04/2003 10/10/2003 53,435 ...... Manar, Inc. (Comp) ...... Henry, TN ...... 11/04/2003 10/24/2003 53,436 ...... Sanmina—SCI (ME) ...... Westbrook, ME ...... 11/04/2003 10/27/2003 53,437 ...... Sequel (Comp) ...... Willow Springs, MO ...... 11/04/2003 11/03/2003 53,438 ...... L. Handy Co., Inc. (Wkrs) ...... Worcester, MA ...... 11/04/2003 10/31/2003 53,439 ...... AM Communications, Inc. (Comp) ...... Quakertown, PA ...... 11/04/2003 10/31/2003 53,440 ...... Nestronix, Inc. (Comp) ...... Quakertown, PA ...... 11/04/2003 10/31/2003 53,441 ...... Coca Cola North America (NJ) ...... Hightstown, NJ ...... 11/04/2003 11/03/2003 53,442 ...... Planto Furniture Mfg. Co., Inc. (Comp) ...... San Antonio, TX ...... 11/05/2003 11/04/2003 53,443 ...... Deco Engineering, Inc. (Comp) ...... Royal Oak, MI ...... 11/05/2003 10/03/2003 53,444 ...... Emerson Process Management Power Pittsburgh, PA ...... 11/05/2003 11/05/2003 (Comp). 53,445 ...... Telewise Communications, Inc. (Wkrs) ...... San Jose, CA ...... 11/05/2003 11/04/2003 53,446 ...... Hexel (Comp) ...... Kent, WA ...... 11/05/2003 10/31/2003 53,447 ...... J.M. Smucker Co. (Wkrs) ...... Woodburn, OR ...... 11/05/2003 11/03/2003 53,448 ...... Texas Instruments (Wkrs) ...... Tucson, AZ ...... 11/05/2003 10/30/2003 53,449 ...... Chevron Phillips Chemical (PACE) ...... Port Arthur, TX ...... 11/05/2003 10/14/2003 53,450 ...... CHC Industries, Inc. (Comp) ...... Jacksonville FL ...... 11/05/2003 11/03/2003 53,451 ...... EDM Corporation (Comp) ...... Piqua, OH ...... 11/05/2003 01/04/2003 53,452 ...... Cadillac Curtain Corporation (Comp) ...... Covington, TN ...... 11/05/2003 10/27/2003 53,453 ...... Giddings Lewis (USWA) ...... Menominee, MI ...... 11/05/2003 10/17/2003 53,454 ...... Acusis (Wkrs) ...... Pittsburgh, PA ...... 11/05/2003 10/30/2003 53,455 ...... Cascade West Sportswear (WA) ...... Puyallup, WA ...... 11/05/2003 11/04/2003 53,456 ...... Asbury Fluxmaster of Utah, Inc. (Wkrs) ...... Ogden, UT ...... 11/05/2003 11/04/2003 53,457 ...... Thomson, Inc. (Comp) ...... Indianapolis, IN ...... 11/06/2003 10/21/2003 53,458 ...... 807 Cutting Services, Inc. (Wkrs) ...... El Paso, TX ...... 11/06/2003 10/28/2003 53,459 ...... Lindberg, Div. of SPX (Wkrs) ...... Watertown, WI ...... 11/06/2003 10/27/2003 53,460 ...... Shelby Elastics of NC, LLC (Comp) ...... Mountain City, TN ...... 11/06/2003 10/27/2003 53,461 ...... Symtech, Inc. (Wkrs) ...... Spartanburg, SC ...... 11/06/2003 10/15/2003 53,462 ...... Marshall Brass (Comp) ...... Marshall, MI ...... 11/06/2003 11/03/2003 53,463 ...... Wings West (Comp) ...... Santa Ana, CA ...... 11/06/2003 10/23/2003 53,464 ...... TECT—Utica (NY) ...... Whitesboro, NY ...... 11/06/2003 10/27/2003 53,465 ...... Tomco Products, Inc. (Comp) ...... Painesville, OH ...... 11/06/2003 10/27/2003 53,466 ...... Berkar Knittin Corp. (Comp) ...... Brooklyn, NY ...... 11/06/2003 10/22/2003 53,467 ...... Gasboy International, LLC (Comp) ...... Lansdale, PA ...... 11/07/2003 11/07/2003 53,468 ...... LF Brands, Inc. (Comp) ...... New York, NY ...... 11/07/2003 11/05/2003 53,469 ...... Wexco Corp. (Comp) ...... Lynchburg, VA ...... 11/07/2003 11/06/2003 53,470 ...... Motorola, Inc. (Wkrs) ...... Rockford, IL ...... 11/07/2003 11/04/2003 53,471 ...... GE Automation Services (Wkrs) ...... Greenville, SC ...... 11/07/2003 11/06/2003 53,472 ...... Sherman-Feinberg Corp. (Comp) ...... South Boston, MA ...... 11/07/2003 11/05/2003 53,473 ...... Farnsworth Fibre Corp. (Comp) ...... S. Boston, MA ...... 11/07/2003 11/05/2003 53,474 ...... ETCO, Inc. (Comp) ...... Warwick, RI ...... 11/07/2003 11/06/2003 53,475 ...... Glenoit Fabrics (Wkrs) ...... Tarboro, NC ...... 11/07/2003 10/31/2003 53,476 ...... Weidmann Systems International, Inc. (Wkrs) St. Johnsbury, VT ...... 11/07/2003 10/27/2003 53,477 ...... XDU Classics, Inc. (Comp) ...... Piedmont, AL ...... 11/07/2003 10/29/2003 53,478 ...... Edgcomb Metals (USWA) ...... Indianapolis, IN ...... 11/07/2003 11/06/2003 53,479 ...... Fabricating Engineering, Inc. (UAW) ...... Davisburg, MI ...... 11/07/2003 11/05/2003 53,480 ...... Lindberg Corp. (Wkrs) ...... Racine, WI ...... 11/07/2003 10/31/2003 53,481 ...... Springs Industries (Comp) ...... Laurel Hill, NC ...... 11/07/2003 10/31/2003 53,482 ...... Siemens Energy and Automation, Inc. Tucker, GA ...... 11/07/2003 11/05/2003 (Comp). 53,483 ...... Active Wear, Inc. (Comp) ...... Martinsville, VA ...... 11/07/2003 11/04/2003 53,484 ...... Powerwave Technologies (CA) ...... El Dorado Hills, CA ...... 11/07/2003 10/30/2003 53,485 ...... Coutts Library Services (Wkrs) ...... Niagara Falls, NY ...... 11/07/2003 10/28/2003 53,486 ...... Stanley Services (Wkrs) ...... Henderson, NC ...... 11/07/2003 11/04/2003 53,487 ...... National Textiles (Comp) ...... Eden, NC ...... 11/07/2003 11/05/2003 53,488 ...... FNW—Familiar Northwest (Wkrs) ...... Portland, OR ...... 11/07/2003 10/27/2003 53,489 ...... Bell Sponging (UNITE) ...... Allentown, PA ...... 11/07/2003 10/28/2003 53,490 ...... Phillips Plastics Corp. (Wkrs) ...... Post Falls, ID ...... 11/07/2003 11/05/2003 53,491 ...... State Pattern Works (WI) ...... Greendale, WI ...... 11/07/2003 11/05/2003 53,492 ...... Falcon Shoe (ME) ...... Lewiston, ME ...... 11/07/2003 11/04/2003

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66875

[FR Doc. 03–29664 Filed 11–26–03; 8:45 am] other products at Bose Corporation, workers at EDM Corporation, Piqua, BILLING CODE 4510–30–M Framingham, Massachusetts. Ohio. Accordingly, the Department is The petitioner has requested that the amending the certification to limit the petition be withdrawn. Consequently, DEPARTMENT OF LABOR certification to the workers of Bose the investigation has been terminated. Corporation, Park Place Manufacturing Employment and Training Signed at Washington, DC, this 10th day of Plant in Framingham, Massachusetts. November, 2003. Administration The amended notice applicable to TA- Linda G. Poole, W–52,545 is hereby issued as follows: [TA–W–52,776] Certifying Officer, Division of Trade Workers of Bose Corporation, Park Place Adjustment Assistance. Biddle Precision Components, Manufacturing Plant, Framingham, [FR Doc. 03–29676 Filed 11–26–03; 8:45 am] Sheridan, IN; Notice of Termination of Massachusetts, who became totally or Investigation partially separated from employment on or BILLING CODE 4510–30–P after July 25, 2002 through September 22, Pursuant to Section 221 of the Trade 2005, are eligible to apply for adjustment Act of 1974, as amended, an assistance under Section 223 of the Trade Act DEPARTMENT OF LABOR investigation was initiated on of 1974.’’ , 2003 in response to a Employment and Training Signed at Washington, DC, this 3rd day of Administration petition filed on behalf of workers of November 2003. Biddle Precision Components, Sheridan, Linda G. Poole, [TA–W–53,232] Indiana. Certifying Officer, Division of Trade The petitioner has requested that the Adjustment Assistance. Fall River Manufacturing II, Gaffney, petition be withdrawn. Consequently, [FR Doc. 03–29684 Filed 11–26–03; 8:45 am] SC; Notice of Termination of the investigation has been terminated. Investigation BILLING CODE 4510–30–P Signed at Washington, DC, this 3rd day of Pursuant to section 221 of the Trade October 2003. Act of 1974, as amended, an Richard Church, DEPARTMENT OF LABOR investigation was initiated on October Certifying Officer, Division of Trade 14, 2003, in response to a petition filed Adjustment Assistance. Employment and Training Administration on by a company official on behalf of [FR Doc. 03–29683 Filed 11–26–03; 8:45 am] workers of Fall River Manufacturing II, BILLING CODE 4510–30–P [TA–W–53,021] Gaffney, South Carolina. The petitioner has requested that the Carm Newsome Hosiery, Inc., Ft. petition be withdrawn. Consequently, DEPARTMENT OF LABOR Payne, AL; Notice of Termination of the investigation has been terminated. Investigation Employment and Training Signed at Washington, DC, this 10th day of Administration Pursuant to section 221 of the Trade November, 2003. Act of 1974, as amended, an Linda G. Poole, [TA–W–52,545] investigation was initiated on Certifying Officer, Division of Trade Bose Corporation, Park Place , 2003, in response to a Adjustment Assistance. Manufacturing Plant, Framingham, petition filed on behalf of workers at [FR Doc. 03–29678 Filed 11–26–03; 8:45 am] Massachusetts; Amended Certification Carm Newsome Hosiery, Inc., Ft. Payne, BILLING CODE 4510–30–P Regarding Eligibility To Apply for Alabama. Worker Adjustment Assistance The petitioner has requested that the petition be withdrawn. Consequently, DEPARTMENT OF LABOR In accordance with Section 223 of the the investigation has been terminated. Trade Act of 1974 (19 U.S.C. 2273) the Signed at Washington, DC, this 3rd day of Employment and Training Department of Labor issued a October, 2003. Administration Certification of Eligibility to Apply for Richard Church, [TA–W–53,193] Worker Adjustment Assistance on Certifying Officer, Division of Trade September 22, 2003, applicable to all Adjustment Assistance. Fishing Vessel (F/V) Eldorado, Mt. workers of Bose Corporation, [FR Doc. 03–29679 Filed 11–26–03; 8:45 am] Vernon, WA; Notice of Termination of Framingham, Massachusetts. The notice Investigation will soon be published in the Federal BILLING CODE 4510–30–P Register. Pursuant to section 221 of the Trade At the request of the State Agency, the DEPARTMENT OF LABOR Act of 1974, as amended, an Department reviewed the certification investigation was initiated on October 8, for workers of the subject firm. The Employment and Training 2003, in response to a petition filed by Department’s review of the certification Administration a company official on behalf of workers and new information obtained from a of Fishing Vessel (F/V) Eldorado, Mt. company official show that the worker [TA–W–53,451] Vernon, Washington. group covered by the shift in production EDM Corporation, Piqua, Ohio; Notice All workers were separated from the of home entertainment products to of Termination of Investigation subject firm more than one year before Mexico should have been limited to the date of the petition. Section 223 (b) workers at the Park Place Manufacturing Pursuant to section 221 of the Trade of the Act specifies that no certification plant. Workers producing home Act of 1974, as amended, an may apply to any worker whose last entertainment products at the Park Place investigation was initiated on November separation occurred more than one year Manufacturing plant are separately 5, 2003, in response to a petition filed before the date of the petition. identifiable from workers producing by a company official on behalf of Consequently, further investigation in

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66876 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

this case would serve no purpose, and to separate a significant number or DEPARTMENT OF LABOR the investigation has been terminated. proportion of workers as required by Employment and Training Signed at Washington, DC, this 16th day of section 222 of the Trade Act of 1974. October, 2003. Significant number or proportion of the Administration Richard Church, workers means that at least three Certifying Officer, Division of Trade workers in a firm with a workforce of [TA–W–53,037; TA–W–53,037A] Adjustment Assistance. fewer than 50 workers would have to be affected. Separations by the subject firm Fishing Vessel (F/V) Big Dog, F/V Miss [FR Doc. 03–29669 Filed 11–26–03; 8:45 am] Julie, Palmer, Alaska; Notice of did not meet this threshold level; BILLING CODE 4510–30–P Termination of Investigation consequently the investigation has been terminated. Pursuant to section 221 of the Trade DEPARTMENT OF LABOR Signed at Washington, DC, this 16th day of Act of 1974, as amended, an October, 2003. investigation was initiated on October 1, Employment and Training 2003, in response to a petition filed by Richard Church, Administration a company official on behalf of workers Certifying Officer, Division of Trade [TA–W–53,069] of F/V Big Dog, Palmer, Alaska (TA–W– Adjustment Assistance. 53,037) and F/V Miss Julie, Palmer, Fishing Vessel (F/V) Family Pride, [FR Doc. 03–29671 Filed 11–26–03; 8:45 am] Alaska (TA–W–53,037A). Kodiak, AK; Notice of Termination of BILLING CODE 4510–30–P The investigation revealed that the Investigation subject firm did not separate or threaten to separate a significant number or Pursuant to section 221 of the Trade DEPARTMENT OF LABOR proportion of workers as required by Act of 1974, as amended, an section 222 of the Trade Act of 1974. investigation was initiated on Employment and Training Significant number or proportion of the September 30, 2003, in response to a Administration workers means that at least three petition filed by a company official on workers in a firm with a workforce of behalf of workers of F/V Joseph Booney, [TA–W–53,066] fewer than 50 workers would have to be Cordova, Alaska. Workers at the subject affected. Separations by the subject firm firm produce frozen salmon. Fishing Vessel (F/V) Deborah Renee, did not meet this threshold level; The Department of Labor issued Clarkston, WA; Notice of Termination consequently the investigation has been negative determinations applicable to of Investigation terminated. the petitioning group of workers on August 27, 2003 (TA–W–52,462). No Signed at Washington, DC, this 16th day of Pursuant to section 221 of the Trade October, 2003. new information or change in Act of 1974, as amended, an Richard Church, circumstances is evident which would investigation was initiated on October 1, result in a reversal of the Department’s Certifying Officer, Division of Trade 2003, in response to a petition filed by Adjustment Assistance. previous determination. Consequently, a company official on behalf of workers [FR Doc. 03–29674 Filed 11–26–03; 8:45 am] further investigation would serve no of F/V Deborah Renee, Clarkston, BILLING CODE 4510–30–P purpose, and the investigation has been Washington. terminated. The investigation revealed that the Signed at Washington, DC, this 16th day of DEPARTMENT OF LABOR October, 2003. subject firm did not separate or threaten to separate a significant number or Richard Church, proportion of workers as required by Employment and Training Certifying Officer, Division of Trade Administration Adjustment Assistance. section 222 of the Trade Act of 1974. Significant number or proportion of the [FR Doc. 03–29670 Filed 11–26–03; 8:45 am] workers means that at least three [TA–W–53,342] BILLING CODE 4510–30–P workers in a firm with a workforce of Halmode Apparel, Inc., Roanoke, fewer than 50 workers would have to be Virgina; Notice of Termination of DEPARTMENT OF LABOR affected. Separations by the subject firm Investigation did not meet this threshold level; Employment and Training consequently the investigation has been Pursuant to section 221 of the Trade Administration terminated. Act of 1974, as amended, an investigation was initiated on October Signed at Washington, DC, this 16th day of [TA–W–53,068] 24, 2003, in response to a worker October, 2003. petition filed on behalf of workers at Fishing Vessel (F/V) Aquarius, Kodiak, Richard Church, AK; Notice of Termination of Halmode Apparel, Inc., Roanoke, Certifying Officer, Division of Trade Investigation Virginia. Adjustment Assistance. The petitioning group of workers is Pursuant to section 221 of the Trade [FR Doc. 03–29672 Filed 11–26–03; 8:45 am] covered by an earlier petition instituted Act of 1974, as amended, an BILLING CODE 4510–30–P on October 6, 2003 (TA–W–53,156), that investigation was initiated on October 1, is the subject of an ongoing 2003, in response to a petition filed by investigation for which a determination a company official on behalf of workers has not yet been issued. Further of Fishing Vessel (F/V) Aquarius, investigation in this case would serve Kodiak, Alaska. no purpose. Consequently, the The investigation revealed that the investigation under this petition has subject firm did not separate or threaten been terminated.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66877

Signed at Washington, DC, this 5th day of Consequently, further investigation party to a free trade agreement with the November, 2003. would serve no purpose, and the United States; Linda G. Poole, investigation has been terminated. 2. the country to which the workers’ firm has shifted production of the articles to a Certifying Officer, Division of Trade Signed at Washington, DC, this 18th day of beneficiary country under the Andean Trade Adjustment Assistance. November, 2003. Preference Act, African Growth and [FR Doc. 03–29677 Filed 11–26–03; 8:45 am] Linda G. Poole, Opportunity Act, or the Caribbean Basin BILLING CODE 4510–30–P Certifying Officer, Division of Trade Economic Recovery Act; or Adjustment Assistance. 3. there has been or is likely to be an [FR Doc. 03–29673 Filed 11–26–03; 8:45 am] increase in imports of articles that are like or DEPARTMENT OF LABOR directly competitive with articles which are BILLING CODE 4510–30–P or were produced by such firm or Employment and Training subdivision. Administration Also, in order for an affirmative DEPARTMENT OF LABOR determination to be made and a certification [TA–W–53,336] of eligibility to apply for worker adjustment Employment and Training assistance as an adversely affected secondary Henredon Furniture, Industries, Spruce Administration group to be issued, each of the group Pine, NC; Notice of Termination of eligibility requirements of Section 222(b) of Investigation Notice of Determinations Regarding the Act must be met. Eligibility To Apply for Worker (1) Significant number or proportion of the Pursuant to section 221 of the Trade Adjustment Assistance workers in the workers’ firm or an Act of 1974, an investigation was appropriate subdivision of the firm have In accordance with section 223 of the initiated on October 24, 2003, in become totally or partially separated, or are Trade Act of 1974, as amended, (19 response to a petition filed by a threatened to become totally or partially U.S.C. 2273), the Department of Labor separated; company official on behalf of workers at herein presents summaries of (2) The workers’ firm (or subdivision) is a Henredon Furniture, Industries, Spruce determinations regarding eligibility to supplier or downstream producer to a firm Pine, North Carolina (TA–W–53,336). apply for trade adjustment assistance for (or subdivision) that employed a group of The petitioner has requested that the workers (TA–W) number and alternative workers who received a certification of petition be withdrawn. Consequently, eligibility to apply for trade adjustment trade adjustment assistance (ATAA) by further investigation in this case would assistance benefits and such supply or (TA–W) number issued during the serve no purpose, and the investigation production is related to the article that was periods of October and November 2003. has been terminated. the basis for such certification; and In order for an affirmative (3) either— Signed in Washington, DC, this 18th day of determination to be made and a (A) the workers’ firm is a supplier and the November, 2003. certification of eligibility to apply for component parts it supplied for the firm (or Linda G. Poole, directly-impacted (primary) worker subdivision) described in paragraph (2) Certifying Officer, Division of Trade adjustment assistance to be issued, each accounted for at least 20 percent of the Adjustment Assistance. of the group eligibility requirements of production or sales of the workers’ firm; or (B) a loss or business by the workers’ firm [FR Doc. 03–29667 Filed 11–26–03; 8:45 am] section 222(a) of the Act must be met. with the firm (or subdivision) described in BILLING CODE 4510–30–P I. Section (a)(2)(A) all of the following must paragraph (2) contributed importantly to the be satisfied: workers’ separation or threat of separation. A. A significant number or proportion of DEPARTMENT OF LABOR the workers in such workers’ firm, or an Negative Determinations for Worker appropriate subdivision of the firm, have Adjustment Assistance Employment and Training become totally or partially separated, or are In the following cases, the Administration threatened to become totally or partially separated; investigation revealed that the criteria [TA–W–53,057] B. the sales or production, or both, of such for eligibility have not been met for the firm or subdivision have decreased reasons specified. Lucent Technologies, Phoenix, AZ; absolutely; and The investigation revealed that Notice of Termination of Investigation C. increased imports of articles like or criteria (a)(2)(A)(I.C.)(Increased imports) directly competitive with articles produced and (a)(2)(B)(II.B) (No shift in Pursuant to section 221 of the Trade by such firm or subdivision have contributed production to a foreign country) have Act of 1974, as amended, an importantly to such workers’ separation or not been met. investigation was initiated on threat of separation and to the decline in sales or production of such firm or TA–W–53,014; Pulaski Furniture Corp., September 30, 2003, in response to a Martinsville, VA worker petition filed on behalf of subdivision; or II. Section (a) (2) (B) both of the following TA–W–53,030; Dayton Superior Corp., workers at Lucent Technologies, must be satisfied: Miamisburg, OH Phoenix, Arizona. A. A significant number or proportion of TA–W–52,974; Corning Photonics This investigation has revealed, the workers in such workers’ firm, or an Technology, Corning Lasertron Div., through the records of the State Agency, appropriate subdivision of the firm, have a subsidiary of Corning, Inc., that none of the petitioners were become totally or partially separated, or are Bedford, MA employed by Lucent Technologies. They threatened to become totally or partially TA–W–53,094; Eastman Machine Co., were employed, and released by, a separated; Buffalo, NY predecessor firm at the same location, B. there has been a shift in production by TA–W–53,101; The Heil Co., d/b/a Heil AG Communications Systems. such workers’ firm or subdivision to a foreign Trailer International, a wholly county of articles like or directly competitive The Department issued a negative with articles which are produced by such owned subsidiary of Dover Corp., determination applicable to the workers firm or subdivision; and Lancaster, PA of AG Communications Systems, C. One of the following must be satisfied: TA–W–53,136; Edgerton Forge, Inc., a Phoenix, Arizona, on September 2, 2003 1. The country to which the workers’ firm subsidiary of Avis Industrial Corp., (TA–W–53,057). has shifted production of the articles is a Edgerton, OH

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66878 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

TA–W–53,048; General Shoelace Co., TA–W–52,818; Hewlett-Packard Co., The investigation revealed that Lincolnton, NC Open VMS Data Protector Team, criteria (a)(2)(A)(I.B) (Sales or TA–W–53,019; Thermal Engineering Colorado Springs, CO production, or both, did not decline) International Utility Products Div., TA–W–52,816; Litton Systems, Inc., and (a)(2)(B)(II.B) (has shifted Joplin, MO Anaheim, CA production to a county not under the TA–W–52,922; Curtis Fine Papers, TA–W–53,058; Seagate Technology, free trade agreement with U.S.) have not Adams Mill, Adams, MA LLC, Research and Development been met. TA–W–53,257; Waggon-Cellers, Inc., Div., Oklahoma City, OK TA–W–52,841; Wheeling-Pittsburgh Amarillo, TX TA–W–52,821; Intel Corp., Colorado Steel Corp., Steubenville, OH TA–W–53,047; Martin Automatic, Inc., Springs, CO TA–W–53,138; Amhil Enterprises, Inc., Rockford, IL TA–W–53,065; Red Devil, Inc., Union, Dickson, TN TA–W–52,536; Wintron Technologies, NJ TA–W–53,063; J.L. Williams Co., Inc., Video Display Corp/Div., Howard, TA–W–53,085; Joe Greene Design and Nampa, ID PA Co., LLC, Hickory, NC TA–W–52,870; Shell Exploration and TA–W–52,826; Tomak Precision, TA–W–53,093; The William Carter Co., Lebanon, OH Production Co., Houston, TX Operations Div., Central Planning TA–W–52,624–A; Shell Exploration and TA–W–53,135; Castle Rubber, LLC, East Department, Griffin, GA Butler, PA Production Co., Houston, TX and TA–W–53,177; Agilent Technologies, New Orleans, LA TA–W–53,168; Allegheny Foundry Co., Automated Test Group, EMT Bolivar, PA TA–W–52,538; Custom Tool & Design, Support and Delivery, Loveland, CO Inc., Erie, PA TA–W–52,770; Tower Mills, Inc., TA–W–53,209; Computer Sciences Burlington, NC Corp., Financial Services Group The investigation revealed that TA–W–52,999; Ace Packaging Systems, (FSG), East Hartford, CT criteria (2) has not been met. The a subsidiary of International Paper, TA–W–53,243; Crown Media workers firm (or subdivision) is not a Monroe Facility, Monroe, MI International, d/b/a Hallmark supplier or downstream producer to TA–W–53,027; Sennett Steel Corp., Channel, a div. of Crown Media trade-affected companies Warren, MI Holdings, Greenwood Village, CO TA–W–52,927; Railway Handle Corp., TA–W–52,995; Pressed Steel Tank Co, TA–W–52,990; Murata Machinery USA, Kenbridge, VA Inc., West Allis, WI Inc., Charlotte, NC TA–W–52,907; Dyecraftsmen, Inc., TA–W–52,502; Norwood Promotional TA–W–52,820; Telemundo Network Taunton, MA Products, Sleepy Eye, MN TA–W–52,702; Atlas Castings and Group, LLC, Hialeah, FL Affirmative Determinations for Worker TA–W–53,348; Sampo Corp. of America, Technology, Tacoma, WA Adjustment Assistance TA–W–53,170; Tex Tech Industries, Fremont, CA TA–W–53,078; Advanced Technical The following certifications have been North Monmouth, ME issued; the date following the company TA–W–53,188; Caliendo Savio Resources, Sunnyvale, CA name and location of each Enterprises, Inc., New Berlin, WI TA–W–52,979; Conocophillips, Odessa, TA–W–53,204; CDI Corp., Corvalis, OR TX determination references the impact TA–W–53,217; Rexnord Industries, Inc., TA–W–53,097; Phycomp\Yageo date for all workers of such Coupling Div., New Berlin, WI America, El Paso, TX determination. TA–W–52,893; R and J Seafood, Kasilof, TA–W–53,052; Rohm and Hass Co., The following certifications have been AK Corp. Headquarters, Accounts issued. The requirements of (a) (2) (A) TA–W–52,988; Simplot Meat Products, Payable Dept., Philadelphia, PA (increased imports) of section 222 have Nampa, ID TA–W–53,282; JP Morgan Chase Bank, been met. TA–W–52,620; Corbin Russwin, Inc., Shared Application Delivery and TA–W–53,109; Hickory Throwing Co., Clarksdale, MS Consulting Services Group, Hickory, NC: September 29, 2002. TA–W–52,630; Ramatech, LLC, Houston, TX and Commercial Loan TA–W–53,117; Quality Investment Belleville, MI Technology Div., Houston, TX Castings, Inc., Blandon, PA: TA–W–52,881; Mohican Mills, TA–W–52,672; Intel Corp., Quality September 23, 2002. Lincolnton, NC Program Engineering Managers, TA–W–52,876; Excel Finishing Cporp., TA–W–53,018; O.P. Link Handle Co., Hillsboro, OR Ridgewood, NY: September 8, 2002. Inc., Salem Facility, Salem, IN TA–W–53,103; Microdyne Outsourcing, TA–W–53,142; Century Furniture TA–W–52,941; Grede Foundries, Inc., Inc., a div. of L3 Communications, Industries, Case Goods Div., a Milwaukee Steel Foundry, Torrance, CA subsidiary of CV Industries, Milwaukee, WI TA–W–53,061; Consul Risk Hickory, NC: September 30,2002. The investigation revealed that Management, Inc., Acton, MA TA–W–53,144; Thos. Moser criteria (a)(2)(A)(I.C) (increased imports) TA–W–53,185; Lawson Software, Inc., Cabinetmakers, Auburn, and (a)(2)(B)(II.C) (has shifted St. Paul, MN ME:September 23, 2002. production to a foreign country) have The investigation revealed that TA–W–52,993; Chas W. House and not been met. criterion (a)(2)(A)(I.A) (no employment Sons, Unionville, CT: September 16, TA–W–53,001; Sartorius Environmental decline) has not been met. 2002. Technology, Inc., Dubuque, IA TA–W–53,172; Meadwestvaco Corp., TA–W–53,197; Annjon Dress Corp., New TA–W–53,025; Invensys-Robertshaw, Envelope Div., Enfield, CT York, NY: October 8, 2002. Long Beach, CA TA–W–53,036; ABA–PGT, Inc., TA–W–53,129; Bayer Pharmaceuticals TA–W–53,012; Nitram, Inc., Tampa, FL Manchester, CT Corp., Pharmaceutical Div., West TA–W–52,749; Akin Industries, Inc., TA–W–53,161; ATC Distribution Group, Haven, CT: October 1, 2002 Case Goods Div., Monticello, AR Formerly Aceomatic Recon, McKees TA–W–53,090; MBU, Inc., New York, The workers firm does not produce an Rocks, PA NY: September 19, 2002. article as required for certification under TA–W–52,791; Rothtec Engraving Corp., TA–W–53,039 &A; Planar Systems, Inc., Section 222 of the Trade Act of 1974. Spartanburg, SC Beaverton, OR and Medical

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66879

Business Unit, Waltham, MA: TA–W–52,983; Escod Industries, Inc., TA–W–52,961; IPAC Fabrics, Inc., a September 23, 2002. BKB, Inc., Insilso Technologies, subsidiary of Industrial Polymers TA–W–53,050; Sappi Fine Paper, North Myrtle Beach, SC: September and Chemicals, Inc., Lewiston, ME: Allentown Facility, Allentown, PA: 16, 2002. September 5, 2002. September 29, 2002. TA–W–52,768; Titan Plastics Group, TA–W–52,882; APW, Inc., Erie, PA: TA–W–53,276; H. Freeman & Son, Inc., Portage, MI: August 27, 2002. September 19, 2002. Philadelphia, PA: October 3, 2002. TA–W–52,874; PMW Illinois, Inc., TA–W–52,887; Connie Rose TA–W–52,954; Federal Mogul Corp., Pennsylvania Machine Works, Inc., Manufacturing, Inc., Philadelphia, Wagner Lighting Div. including Carlinville, IL: September 10, 2002. PA: September 17, 2002. leased workers of Staffing TA–W–52,858; Wetsel-Oviatt Lumber TA–W–53,240; Friedrich Air Solutions, Sparta, TN: September Co., El Dorado Hills, CA: August 25, Conditioning Co., San Antonio, TX: 12, 2002. 2002. September 30, 2002. TA–W–52,846; Brookman Cast TA–W–52,796; Halliburton Energy TA–W–52,834; The Safety Stitch, Inc., Industries, Salem, OR: August 22, Services, Alaska Operations, Harrisville, WV: August 22, 2002. 2002. Prudhoe Bay, AK, A; Sterling, AK, TA–W–52,623; Five Rivers Electronic TA–W–52,721; Cascade Fibers Co., Inc., B; Fairbanks, AK and C; Anchorage, Innovations, LLC, Greeneville, TN: Cascade Fibers Co of Sanford, LLC, AK: September 2, 2002. , 2002. including leased workers of TA–W–52,786; Excelsior Foundry Co., TA–W–52,654; Current Industries, Inc., Employer Options, LLC, Sanford, Belleville, IL: , 2002. Bellingham, WA: August 5, 2002. NC: August 28, 2002. TA–W–53,022; Ideal Forging Corp., TA–W–53,281; American Marketing TA–W–53,235; Keith Dennis Co., LLC, Southington, CT: September 24, Industries, Inc., Dunbrooke Div., Dandridge, TN: October 8, 2002. 2002. Independence, MO: October 15, TA–W–53,042; Solon Manufacturing TA–W–52,917; Hooven Allison, Xenia, 2002. Co., Rhinelander, WI: September 24, OH: September 5, 2002. TA–W–52,994; The Scotts Co., Temecula TA–W–52,877; Sonoco Flexible 2002. TA–W–52,863; Thantex Specialties, Inc., operation, including leased workers Packaging, a div. of Sonoco of Manpower and Remedy, Products Co., including leased Abbeville, SC: August 27, 2002 TA–W–52,565; Johns Manville Corp., Temecula, CA: September 5, 2002. workers of Workload, Inc., Fulton, TA–W–52,919; The Keller NY: September 9, 2002. Engineered Products Group, Vienna, VA: August 8, 2002 Manufacturing Co., Inc., Furniture TA–W–52,855; On Semiconductor, East Manufacturing Div., Corydon, IN: Greenwich Div., including leased TA–W–52,762; TT Group, Inc., a wholly owned subsidiary of TT Group, September 5, 2002. workers of Kelly Services, East TA–W–52,490; Vernon Plastics, a wholly Greenwich, RI: September 3, 2002. LTD, Aurora, MO: August 29, 2002. TA–W–52,792; RST&B Curtain and owned subsidiary of The Imperial TA–W–53,122; North Pacific Processors, Drapery, Woodruff, SC: September Home De´cor Group, including Inc., Cordova, AK: September 3, 2, 2002. leased workers from Agentry, 2002. TA–W–52,572; Allsteel, Inc., a div. of Haverhill, MA: , 2002. TA–W–53,128; Wilson Sporting Goods, Hon Industries, West Hazleton, PA: TA–W–52,609; Coastal Lumber Co., Springfield, TN: October 1, 2002. August 14, 2002. Bruceton Mills, WV: , TA–W–53,031; Randco Tool and Die, TA–W–52,664; Slater Steel Corp., a 2002. Inc., Meadville, PA: , wholly owned subsidiary of Slater TA–W–52,783; Crystal Creative 2002. Steel, Inc., Fort Wayne, IN: , Products, a div. of Cleo, Inc., TA–W–53,007; Contempora Fabrics, 2003. Maysville, KY: August 20, 2002. Inc., Lumberton, NC: September 4, TA–W–52,793; Milligan and Higgins, a TA–W–52,700; Circuit Science, Inc., 2002. div. of Hudson Industries Corp., Plymouth, MN: August 27, 2002. TA–W–52,902; Buffalo China, Inc., Johnstown, NY: September 2, 2002. TA–W–52,688A; Howes Leather Corp., Buffalo, NY: September 4, 2002. TA–W–52,573; Gentry Mills, Inc., Clearfield Whole Leather Div., TA–W–53,110; Zorlu Manufacturing Co., Albemarle, NC: , 2002. Curwensville, PA: , LLC, Warrenton, GA: September 24, TA–W–52,603; Sierra Pine Ltd, Medite 2003. 2002. Div., Medford, OR: August 18, 2002. TA–W–53,015; Texas PMW, Inc., The following certifications have been TA–W–53,141; Atlas Model Railroad issued. The requirements of (a) (2) (B) Pennsylvania Machine Works, Inc., Co., Inc., Hillside, NJ: , Houston, TX: September 10, 2002 (shift in production) of section 222 have 2002. been met. TA–W–53,028; BIC Corp., Lighters Div., TA–W–53,238; West Linn Paper Co., Gaffney, SC: September 23, 2002 West Linn, OR: October 7, 2002. TA–W–52,951; T & W Forge, Inc., Div. of TA–W–52,924; Techneglas, Inc., TA–W–53,151; Cole Hersee Co., Boston, Durrell Corp., Alliance, OH: August Columbus, OH and Pittston, PA: MA: October 3, 2002. 29, 2002. October 20, 2003. TA–W–53,160; Biddle Precision TA–W–52,982; Glaxo Smith Kline TA–W–52,925; SKF USA, Inc., Altoona Components, Sheridan, IN: Pharmaceuticals, Piscataway, NJ: Div., Altoona, PA: September 11, September 10, 2002. , 2003. 2002. TA–W–53,127; Ault, Inc., Minneapolis, TA–W–53,010; New Generation Yarn TA–W–52,931; PCS Nitrogen Fertilizer, MN: October 2, 2002. Corp., Gibsonville, NC: September LP, a/k/a Memphis Plant, a div. of TA–W–53, 189; Campbell Foundry Co., 15, 2002. Potash Corp., Millington, TN: Harrison, NJ: October 7, 2002. TA–W–53,227; Voith Paper, Voith Paper September 2, 2002. TA–W–52,773; Lebanite Corp., Service Southeast Div., Salisbury, TA–W–52,944; Chiquola Fabrics, LLC, Hardboard Div., Lebanon, OR: NC: , 2002. Kingsport, TN: September 15, 2002 November 1, 2002. TA–W–53,105; American & Efird, Inc., TA–W–52,973; Cortina Fabrics, TA–W–52,650; PPG Industries, Fiber Mainden Facility, a div. of The Swepsonville, NC: September 24, Glass Div., Lexington, NC: , Ruddick Corp., Mt. Holly, NC: 2002. 2002. October 1, 2002.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66880 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

TA–W–53,187; Harriet and Henderson TA–W–53,163; Zapata Industries, Inc., TA–W–52,986; Alcoa Fujikura Ltd, Yarns, Inc., Corp. Office, Muskogee, OK: October 3, 2002. Telecommunications Div., Duncan, Henderson, NC: , 2002. TA–W–52,998; Saint-Gobain Calmar, SC: September 15, 2002. TA–W–53,143; Erni Components, Inc., Inc., City of Industry, CA: TA–W–53,212 & A; Heraeus Quartztech, Chester, VA: September 30, 2002. September 25, 2002. LLC, a subsidiary of Heraeus TA–W–53,002; Akzo Nobel Coatings, TA–W–52,991; Select Elastics of Holding GMBH, Austin, TX and Inc., Carney’s Point, NJ: September America, Inc., McAllen, TX: Round Rock, TX: October 8, 2002. 5, 2002. September 22, 2002. TA–W–53,186; Arlon, Inc., Engineered TA–W–52,891; C.O.W. Industries, Inc., TA–W–52,964; Phelps Dodge Mining Coatings & Laminates Div., East including leased workers of CBS Co., Tyrone Mining, LLC, Tyrone, Providence, RI: September 29, 2002. Companies, Columbus, OH: NM: September 3, 2002. TA–W–53,155; Brazeway, Inc., Brazeway September 22, 2002. TA–W–52,880; Dayton Superior Corp., DeWitt Div., including leased TA–W–53,166; Arvin Meritor, Inc., Birmingham, AL: , workers of Talent Tree, DeWitt, IA: Chickasha, OK: October 1, 2002. 2002. October 6, 2002. TA–W–52,929; Kaydon Corp., Sumter, TA–W–53,081; Robert Manufacturing TA–W–53,005; Canton Drop Forge, SC: September 15, 2002. Co., Rancho Cucamonga, CA: Canton, OH: September 12, 2002. TA–W–53,261; International Stone September 8, 2002. TA–W–52,889; Fox River Paper Co., Products, Inc., Barre, VT: October 3, TA–W–53,038; Coats and Clark, Inc., Appleton, WI: September 18, 2002. 2002. Toccoa, GA: September 26, 2002. TA–W–52,864; Cooper-Atkins Corp., TA–W–52,831; SPX Dock Products, TA–W–53,043; Honeywell Airframe Middlefield, CT: August 19, 2002. Mechanical Dock Lever Div., Systems, Torrance, CA: September TA–W–53,003; Honeywell International, Carrollton, TX: September 3, 2002. 26, 2002. Inc., Automation and Control TA–W–53,133; Charlotte Trimming Co., TA–W–53,004; Xerox Corp., Business Solutions Div., including leased Charlotte, NC: October 1, 2002. Group Operations (BGO), Webster, workers of Manpower, TA–W–52,914; Gates Corp., Power NY: September 15, 2002. Albuquerque, NM: September 18, Transmission Div., Belt Plant, TA–W–52,718; I.T.W. Foils, East 2002. TA–W–52,929; Kaydon Corp., Sumter, Elizabethtown, KY: September 10, Brunswick, NJ: August 21, 2002. SC: September 15, 2002. 2002. TA–W–52,722; Conso International TA–W–52,831; SPX Dock Products, TA–W–52,866; Dyno Nobel, Port Ewen Corp., Union, SC: August 29, 2002 Mechanical Dock Lever Div., Plant, Charge and Press TA–W–52,754; ACS Industries, Inc., Carrollton, TX: September 3, 2002. Department, Ulster Park, NY: Villanova Plant, Woonsocket, RI: TA–W–53,187; Harriet and Henderson , 2002. August 20, 2002. Yarns, Inc., Corp. Office, TA–W–53,056; Toshiba America TA–W–52,813; Eastman Kodak Co., Henderson, NC: October 4, 2002. Information Systems, Inc. (TAIA), a HISIS Finishing Department B–313, TA–W–52,647; PACCAR, Inc., a div. of subsidiary of Toshiba America, Inc., Rochester, NY: September 2, 2002. Peterbilt Motors, Madison, TN: a subsidiary of Toshiba Corp., TA–W–52,853; Trenton Technology, August 18, 2002. Irvine, CA: September 26, 2002. Inc., Utica, NY: September 4, 2002. TA–W–52,959; Maxxim Medical, Inc., TA–W–52,997; Fishing Vessel (F/V) TA–W–52,575; Volex, Inc., including Honea Path, SC: September 19, Valeta H. Point Baker, AK: leased workers of Accuforce, 2002. September 23, 2002. Manpower and Foothills, Conover, TA–W–52,840; Merit Abrasive Products, TA–W–53,214; Rhodia, Inc., Chicago NC: August 13, 2002. Brookline, Ohio Division, Brookline, Heights, IL: September 22, 2002. TA–W–52,631; Northland, A Scott OH: August 18, 2002. TA–W–53,286; Elox Corp., a div. of Agie Fetzer Co., Watertown, NY: August TA–W–52,794; Practice Partner, Inc., Charmilles Holding Corp., 12, 2002. Goldsboro, NC: September 3, 2002. Davidson, NC: October 17, 2002. TA–W–52,649; Tellabs Operations, Inc., TA–W–52,720; Amphenol T&M TA–W–52,904; York International Corp., Bolingbrook, IL: August 19, 2002. Antennas, Vernon Hills, IL: August York, PA: September 9, 2002. TA–W–52,655; Takata Petri, Inc., a 28, 2002 TA–W–52,844; 4 D’s Industries, Tellico subsidiary of TK Holdings, Port TA–W–52,857; Hart Tackle Company, Plains, TN: September 4, 2002. Huron, MI: August 22, 2002. LLC, Starford, OK: August 22, 2002. TA–W–53,304; Molecular Bioproducts, TA–W–52,862; Paxar Corp., Fabric Label TA–W–52,688; Howes Leather Corp., Inc., Quality Scientific Plastics, Inc., Group, Lenoir, NC: August 26, 2002. Currwensville and Cutting Div., Petaluma, CA: September 24, 2002. TA–W–53,165; Thermal Ceramics, RPC, Curwensville, PA: September 25, TA–W–53,017; Sunbeam Products, Inc., Elgin, IL: October 1, 2002. 2003. Hattiesburg, MS: September 23, TA–W–53,108; The Hon Co., Chair TA–W–52,984; Samina-SCI, Cable Div., 2002. Department, including leased including leased workers of On- TA–W–52,976; Upholstery Fabric Mill of workers of Corestaff and Kimco, Point Personnel and Employee Georgia, Inc., Jasper, GA: September South Gate, CA: September 22, Solutions, Carrollton, TX: 19, 2002. 2002. September 17, 2002. TA–W–52,934; Lego Systems, Inc., TA–W–53,125; Ranco North America, TA–W–53,034; C&C Smith Lumber Co., Shows and Events Div., Enfield, CT: Invensys Climate Controls Div., Inc., Summerhill, PA: August 28, September 26, 2002. including leased workers of 2002. TA–W–52,940; Motor Coach Industries Manpower, Link and Select, TA–W–52,872; Beckton Dickinson and International, Inc., Roswell, NM: Brownsville, TX: September 23, Co., Consumer Healthcare Div., , 2002. 2002. Holdrege, NE: September 11, 2002. TA–W–53,239; Acme Mills Co., Fairway TA–W–53,073; OK–1 Manufacturing Co., TA–W–53,221; Intermetro Industries, a Products, Quincy, MI: September Inc., Altus, OK: September 26, 2002. div. of Emerson Electric, Wilkes- 26, 2002. TA–W–52,955; Andritz, Inc., Muncy Barre, PA: November 6, 2003. TA–W–53,199; Eudora Garments Corp., Plant #2, a subsidiary of Andritz The following certification has been Eudora, AR: October 3, 2002. AG, Muncy, PA: September 5, 2002. issued. The requirement of upstream

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66881

supplier to a trade certified primary firm TA–W–53,217; Rexnord Industries, Inc., TA–W–53,017; Sunbeam Products, Inc., has been met. Coupling Div., New Berlin, WI Hattiesburg, MS: September 23, TA–W–53,011; General Dynamics, TA–W–53,061; Consul Risk 2002. Mosses Lake, WA: September 24, Management, Inc., Acton, MA TA–W–53,031; Randco Tool and Die, 2002. TA–W–53,063; J.L. Williams Co., Inc., Inc., Meadville, PA: September 12, TA–W–53,126; Siemens Energy and Nampa, ID 2002. TA–W–52,870; Shell Exploration and Automation, Inc., Machine Tool TA–W–53,105; American & Efird, Inc., Production Co., Houston, TX Business Unit, Lebanon, OH: Maiden Facility, a div. of The TA–W–52,893; R and J Seafood, Kasilof, September 23, 2002. Ruddick Corp., Mt. Holly, NC: AK October 1, 2002. TA–W–52,907; Dyecraftsmen, Inc., Negative Determinations for Alternative TA–W–53,007; Contempora Fabrics, Inc. Taunton, MA Trade Adjustment Assistance Lumberton, NC: September 4, 2002. TA–W–52,988; Simplot Meat Products, In order for the Division of Trade Nampa, ID TA–W–52,976; Upholstery Fabric Mill of Adjustment Assistance to issued a TA–W–52,624 & A; Shell Exploration Georgia, Inc., Jasper, GA: September certification of eligibility to apply for and Production Co., Houston, TX 19, 2002. 2002. Alternative Trade Adjustment and New Orleans, LA TA–W–52,902; Buffalo China, Inc., Assistance (ATAA) for older workers, TA–W–52,749; Akin Industries, Inc., Buffalo, NY: September 4, 2002. the group eligibility requirements of Case Goods Div., Monticello, AR TA–W–52,934; Lego Systems, Inc., section 246(a)(3)(A)(ii) of the Trade Act TA–W–52,620; Corbin Russwin, Inc., Shows and Events Div., Enfield, CT: must be met. Clarksdale, MS September 26, 2002. In the following cases, it has been TA–W–52,630; Ramatech, LLC, TA–W–52,940; Motor Coach Industries determined that the requirements of Belleville, MI International, Inc., Roswell, NM: section 246(a)3)ii) have not been met for TA–W–52,881; Mohican Mills, September 14, 2002. the reasons specified. Lincolnton, NC TA–W–53,239; Acme Mills Co., Fairway Since the workers are denied TA–W–53,018; O.P. Link Handle Co., Products, Quincy, MI: September eligibility to apply for TAA, the workers Inc., Salem Facility, Salem, IN 26, 2002. cannot be certified eligible for ATAA. TA–W–53,185; Lawson Software, Inc., TA–W–53,163; Zapata Industries, Inc., TA–W–53,135; Castle Rubber, LLC, East St. Paul, MN Muskogee, OK: October 3, 2002. Butler, PA TA–W–52,941; Grede Foundries, Inc., TA–W–53,110; Zorlu Manufacturing Co., TA–W–53,168; Allegheny Foundry Co., Milwaukee Steel Foundry, LLC, Warrenton, GA: September 24, Bolivar, PA Milwaukee, WI 2002. TA–W–52,770; Tower Mills, Inc., Affirmative Determinations for TA–W–53,015; Texas PMW, Inc., Bulington, NC Alternative Trade Ajdustment Pennsylvania Machine Works, Inc., TA–W–52,791; Rothtec Engraving Corp., Assistance Houston, TX: September 10, 2002. TA–W–53,028; Bic Corp., Lighters Div., Spartanburg, SC In order for the Division of Trade Gaffney, SC:September 23, 2002. TA–W–52,999; ACE Packaging Systems, Adjustment Assistance to issued a TA–W–52,998; Saint-Gobain Calmar, a subsidiary of International Paper, certification of eligibility to apply for Inc., City of Industry, CA: Monroe Facility, Monroe, MI Alternative Trade Adjustment September 25, 2002. TA–W–53,027; Sennett Steel Corp., Assistance (ATAA) for older workers, TA–W–52,991; Select Elastics of Warren, MI the group eligibility requirements of America, Inc., McAllen, TX: TA–W–53,052; Rohm and Hass Co., section 246(a)(3)(A)(ii) of the Trade Act September 22, 2002. Corp. Headquarters, Accounts must be met. Payable Department, Philadelphia, The following certifications have been TA–W–52,924 A; Techneglas, Inc., PA issued; the date following the company Columbus, OH and Pittston, PA: TA–W–53,138; Amhil Enterprises, Inc., name and location of each October 20, 2003. Dickson, TN determination references the impact TA–W–52,925; SKF USA, Inc., Altoona, TA–W–53,282 &A; JP Morgan Chase date for all workers of such PA: September 11, 2002. Bank, Shared Application Delivery determinations. TA–W–52,931; PCS Nitrogen Fertilizer, and Consulting Services Group, In the following cases, it has been LP, a/k/a Memphis Plant, a div. of Houston, TX and Commercial Loan determined that the requirements of Potash Corp., Millington, TN: Technology Div., Houston, TX section 246(a)(3)(ii) have been met. September 2, 2002. TA–W–52,995; Pressed Steel Tank Co., I. Whether a significant number of TA–W–52,944; Chiquola Fabrics, LLC, Inc., West Allis, WI workers in the workers’ firm are 50 Kingsport, TN: September 15, 2002. TA–W–52,502; Norwood Promotional years of age or older. TA–W–52,964; Phelps Dodge Mining Products Sleepy Eye, MN II. Whether the workers in the Co., Tyrone Mining, LLC, Tyrone, TA–W–52,672; Intel Corp., Quality workers’ firm possess skills that are not NM: September 3, 2002. Program Engineering Managers, easily transferable. TA–W–52,973; Cortina Fabrics, Hillsboro, OR III. The competitive conditions within Swepsonville, NC: September 24, TA–W–52,702; Atlas Castings and the workers’ industry (i.e., conditions 2002. Technology, Tacoma, WA within the industry are adverse). TA–W–52,983; Escod Industries, Inc., TA–W–53,103; Microdyne Outsourcing, TA–W–53,304; Molecular Bioproducts, BKB, Inc., Insilso Technologies, Inc., a div. of L3 Communications, Inc., Quality Scientific Plastics, Inc., North Myrtle Beach, SC: September Torrance, CA Petaluma, CA: September 24, 2002. 16, 2002. TA–W–53,170; Tex Tech Industries, TA–W–53,122; North Pacific Processors, TA–W–52,768; Titan Plastics Group, North Monmouth, ME Inc., Cordova, AK: September 3, Portage, MI: August 27, 2002. TA–W–53,188; Caliendo Savio 2002. TA–W–52,874; PMW Illinois, Inc. Enterprises, Inc., New Berlin, WI TA–W–53,128; Wilson Sporting Goods, Pennsylvania Machine Works, Inc., TA–W–53,204; CDI Corp., Corvalis, OR Springfield, TN: October 1, 2002. Carlinville, IL: September 10, 2002.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66882 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

TA–W–52,880; Dayton Superior Corp., TA–W–52,655; Takata Petri, Inc., a workers of Talent Tree, DeWitt, IA: Birmingham, AL: September 18, subsidiary of TK Holdings, Port October 6, 2002. 2002. Huron, MI: August 22, 2002. TA–W–52,967; Stoneridge, Inc., TA–W–52,858; Wetsel-Oviatt Lumber TA–W–52,664; Slater Steel Corp., a Alphabet Div., Mebane, NC: Company, El Dorado Hills, CA: wholly owned subsidiary of Slater , 2002. August 25, 2002. Steel, Inc., Fort Wayne, IN: April 7, TA–W–52,773; Lebanite Corp., TA–W–52,796, A,B,C; Halliburton 2003. Hardboard Div., Lebanon, OR: Energy Services, Alaska Operations, TA–W–52,688; Howes Leather Corp., November 1, 2002. Prudhoe Bay, AK, Sterling, AK, Curwensville and Cutting Div., TA–W–52,650; PPG Industries, Fiber Fairbanks, AK and Anchorage, AK: Curwensville, PA and Clearfield Glass Division, Lexington, NC: July September 2, 2002. Whole Leather Div., Curwensville, 26, 2002. TA–W–52,786; Excelsior Foundry Co., PA: September 25, 2003. TA–W–53,005; Canton Drop Forge, Belleville, IL: August 21, 2002. TA–W–52,793; Milligan and Higgins, a Canton, OH: September 12, 2002. TA–W–53,081; Robert Manufacturing div. of Hudson Industries Corp., TA–W–52,961; IPAC Fabrics, Inc., a Co., Rancho Cucamonga, CA: Johnstown, NY: September 2, 2002. subsidiary of Industrial Polymers September 8, 2002. TA–W–52,862; Paxar Corp., Fabric Label and Chemicals, Inc., Lewiston, ME: September 5, 2002. TA–W–53,011; General Dynamics, Group, Lenoir, NC: August 26, 2002. TA–W–52,882; APW, Inc., Erie, PA: Mosses Lake, WA: September 24, TA–W–52,573; Gentry Mills, Inc., September 19, 2002. 2002. Albemarle, NC: August 11, 2002. TA–W–52,603; Sierra Pine Ltd, Medite TA–W–52,887; Connie Rose TA–W–53,022; Ideal Forging Corp., Manufacturing, Inc., Philadelphia, Southington, CT: September 24, Div., Medford, OR: August 18, 2002. TA–W–53,141; Atlas Model Railroad PA: September 17, 2002. 2002. TA–W–52,889; Fox River Paper Co., TA–W–53,038; Coats and Clark, Inc., Co., Inc., Hillside, NJ: October 2, 2002. Appleton, WI: September 18, 2002. Toccoa, GA: September 26, 2002. TA–W–52,864; Cooper-Atkins Corp., TA–W–53,042; Solon Manufacturing TA–W–53,238; West Linn Paper Co., West Linn, OR: October 7, 2002. Middlefield, CT: August 19, 2002. Co., Rhinelander, WI: September 24, TA–W–53,240; Friedrich Air 2002. TA–W–53,151; Cole Hersee Co., Boston, MA: October 3, 2002. Conditioning Co., San Antonio, TX: TA–W–53,043; Honeywell Airframe TA–W–53,160; Biddle Precision September 30, 2002. Systems, Torrance, CA: September TA–W–52,834; The Safety Stitch, Inc., Components, Sheridan, IN: 26, 2002. Harrisville, WV: August 22, 2002. September 10, 2002. TA–W–53,004; Xerox Corp., Business TA–W–53,165; Thermal Ceramics, RPC, I hereby certify that the Group Operations (BGO), Webster, Elgin, IL: October 1, 2002. aforementioned determinations were NY: September 15, 2002. TA–W–53,108; The Hon Co., Chair issued during the months of October TA–W–52,863; Thantex Specialties, Inc., Department including leased and November. Copies of these Abbeville, SC: August 27, 2002. workers of Corestaff and Kimco, determinations are available for TA–W–52,565; Johns Manville Corp., South Gate, CA: September 22, inspection in Room C–5311, U.S. Engineered Products Group, 2002. Department of Labor, 200 Constitution Vienna, VA: August 8, 2002. TA–W–53,125; Ranco North America, Avenue, NW., Washington, DC 20210 TA–W–52,718; I.T.W. Foils, East Invensys Climate Controls Div., during normal business hours or will be Burnswick, NJ: August 21, 2002. including leased workers of mailed to persons who write to the TA–W–52,722; Conso International Manpower, Link, and Select, above address. Corp., Union, SC: August 29, 2002. Brownsville, TX: September 23, Dated: November 14, 2003. TA–W–52,754; ACS Industries, Inc., 2002. Timothy Sullivan, Villanova Plant, Woonsocket, RI: TA–W–53,126; Siemens Energy and August 20, 2002. Director, Division of Trade Adjustment Automation, Inc., Machine Tool Assistance. TA–W–52,762; TT Group, Inc., a wholly Business Unit, Lebanon, OH: [FR Doc. 03–29680 Filed 11–26–03; 8:45 am] owned subsidiary of TT Group, Ltd, September 23, 2002. BILLING CODE 4510–30–P Aurora, MO: August 29, 2002. TA–W–53,127; Ault, Inc., Minneapolis, TA–W–52,792; RST&B Curtain and MN: October 2, 2002. Drapery, Woodruff, SC: September TA–W–53,073; OK–1 Manufacturing Co., DEPARTMENT OF LABOR 2, 2002. Inc., Altus, OK: September 26, 2002. TA–W–52,813; Eastman Kodak Co., TA–W–52,955; Andritz, Inc., Muncy Employment and Training HISIS Finishing Department B–313, Plant #2, a subsidiary of Andritz Administration Rochester, NY: September 2, 2002. AG, Muncy, PA: September 5, 2002. TA–W–52,853; Trenton Technology, TA–W–52,986; Alcoa Fujikura Ltd, [TA–W–53,506] Inc., Utica, NY: September 4, 2002. Telecommunications Div., Duncan, Romac Industries, Inc., Sultan, WA; TA–W–52,572; Allsteel, Inc., a div. of SC: September 15, 2002. Notice of Termination of Investigation Hon Industries, West Hazleton, PA: TA–W–53,189; Campbell Foundry Co., August 14, 2002. Harrison, NJ: October 7, 2002. Pursuant to section 221 of the Trade TA–W–52,575; Volex, Inc., including TA–W–53,212&A; Heraeus Quartztech, Act of 1974, as amended, an leased workers of Accuforce, LLC, a subsidiary Heraeus Holding investigation was initiated on November Manpower and Foothills, Conover, GMBH, Austin, TX and Round 12, 2003, in response to a worker NC: August 13, 2002. Rock, TX: October 8, 2002. petition filed by the company on behalf TA–W–52,631; Northland, a Scott Fetzer TA–W–53,186; Arlon, Inc., Engineered of workers at Romac Industries, Inc., Co., Watertown, NY: August 12, Coatings and Laminates Div., East Sultan, Washington. 2002. Providence, RI: September 29, 2002. The petitioner has requested that the TA–W–52,649; Tellabs Operations, Inc., TA–W–53,155; Brazeway, Inc., Brazeway petition be withdrawn. Consequently, Bolingbrook, IL: August 19, 2002. Dewitt Div., including leased the investigation has been terminated.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66883

Signed at Washington, DC, this 18th day of DEPARTMENT OF LABOR Conclusion November, 2003. After careful consideration of the facts Employment and Training Richard Church, obtained on reopening, I determine that Administration Certifying Officer, Division of Trade workers of Southeastern Adhesives Adjustment Assistance. [TA–W–52,848] Company, Lenoir, North Carolina, [FR Doc. 03–29666 Filed 11–26–03; 8:45 am] qualify as adversely affected secondary BILLING CODE 4510–30–P Snap-Tite, Inc., Autoclave Engineers workers under Section 222 of the Trade Division, Erie, PA; Notice of Act of 1974, as amended. Termination of Investigation In accordance with the provisions of DEPARTMENT OF LABOR Pursuant to Section 221 of the Trade the Act, I make the following revised Act of 1974, as amended, an determination: Employment and Training investigation was initiated on All workers of Southeastern Adhesives Administration September 12, 2003, in response to a Company, Lenoir, North Carolina, who petition filed on behalf of workers at became totally or partially separated from [TA–W–51,458] employment on or after September 2, 2002, Snap-Tite, Inc., Autoclave Engineers through two years from the date of Division, Erie, Pennsylvania. Silicon Graphics, Inc., Worldwide certification, are eligible to apply for The petitioners have requested that adjustment assistance under Section 223 of Manufacturing Organization Including the petition be withdrawn. the Trade Act of 1974. Leased Workers of Kelly Services Consequently, the investigation has Signed in Washington, DC this 17th day of Chippewa Falls, WI; Notice of been terminated. November 2003. Affirmative Determination Regarding Signed at Washington, DC this 3rd day of Linda G. Poole, Application for Reconsideration October 2003. Certifying Officer, Division of Trade Richard Church, Adjustment Assistance. By letter of July 22, 2003, a petitioner Certifying Officer, Division of Trade [FR Doc. 03–29682 Filed 11–26–03; 8:45 am] requested administrative Adjustment Assistance. BILLING CODE 4510–30–P reconsideration of the Department of [FR Doc. 03–29681 Filed 11–26–03; 8:45 am] Labor’s Notice of Negative BILLING CODE 4510–30–P Determination Regarding Eligibility to DEPARTMENT OF LABOR Apply for Worker Adjustment Assistance, applicable to workers of the DEPARTMENT OF LABOR Employment and Training subject firm. The Department’s Administration Employment and Training determination notice was signed on [TA–W–52,639] , 2003. The notice was published Administration in the Federal Register on , 2003 [TA–W–52,835] Textron, Ferndale Fastener Division, (68 FR 39976). Madison Heights, MI; Notice of Southeastern Adhesives Company, The Department reviewed the request Termination of Investigation Lenoir, NC; Notice of Revised for reconsideration and has determined Determination on Reopening Pursuant to section 221 of the Trade that the petitioner has provided Act of 1974, as amended, an additional information. Therefore, the On November 10, 2003, the investigation was initiated on August Department will conduct further Department, on its own motion, 21, 2003, in response to a worker investigation to determine if the workers reopened its investigation for the former petition filed on behalf of workers at meet the eligibility requirements of the workers of the subject firm. Textron, Ferndale Fastener Division, Trade Act of 1974. The initial investigation was initiated Madison Heights, Michigan. on September 12, 2003, and resulted in The petitioner has requested that the Conclusion a negative determination issued on petition be withdrawn. Consequently, , 2003. The investigation the investigation has been terminated. After careful review of the findings showed that workers of the Signed at Washington, DC, this 4th day of application, I conclude that the claim is subject firm did not supply at least 20 of sufficient weight to justify September, 2003. percent of production or sales to a firm Richard Church, reconsideration of the Department of that employed a group of workers who Labor’s prior decision. The application Certifying Officer, Division of Trade received a certification of eligibility to Adjustment Assistance. is, therefore, granted. apply for trade adjustment assistance [FR Doc. 03–29675 Filed 11–26–03; 8:45 am] Signed at Washington, DC this 3rd day of (TAA). Consequently, workers of BILLING CODE 4510–30–P November, 2003. Southeastern Adhesives Company, Elliott S. Kushner, Lenoir, North Carolina, could not be certified as a secondarily affected Certifying Officer, Division of Trade DEPARTMENT OF LABOR worker group. The denial notice was Adjustment Assistance. published in the Federal Register on [FR Doc. 03–29685 Filed 11–26–03; 8:45 am] Employment and Training November 6, 2003 (68 FR 62832). Administration BILLING CODE 4510–30–P The Department has obtained new information showing that the subject [TA–W–53,266] firm supplied adhesives to a furniture West Coast Fashion, Inc., South El manufacturer whose workers were Monte, CA; Notice of Termination of certified eligible to apply for TAA and Investigation the loss of business contributed importantly to worker separations at the Pursuant to section 221 of the Trade Lenoir, North Carolina plant. Act of 1974, an investigation was

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66884 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

initiated on October 16, 2003, in FOR FURTHER INFORMATION CONTACT: comments concerning the proposed response to a petition filed by the TAA William Carlson, Chief, Division of request to extend the expiration date of Division Coordinator Employment Foreign Labor Certification, the collection request to: Development Department on behalf of Employment and Training *Evaluate whether the proposed workers at West Coast Fashion, Inc., Administration, U.S. Department of collection of information is necessary South El Monte, California. Labor, Room C–4318, 200 Constitution for the proper performance of the The petitioner has requested that the Avenue, NW., Washington, DC 20210– functions of the agency, including petition be withdrawn. Consequently, 0001, 202–693–3010 (this is not a toll- whether the information will have the investigation has been terminated. free number), fax 202–693–2769. practical utility; SUPPLEMENTARY INFORMATION: Signed in Washington, DC, this 18th day of *Evaluate the accuracy of the agency’s November, 2003. I. Background estimate of the burden of the proposed Richard Church, The Wagner-Peyser Act, as amended, collection of information, including the Certifying Officer, Division of Trade validity of the methodology and Adjustment Assistance. provides that the Office of National assumptions used; [FR Doc. 03–29668 Filed 11–26–03; 8:45 am] Programs shall assist the State public employment services throughout the *Enhance the quality, utility, and BILLING CODE 4510–30–P country in promoting uniformity in its clarity of the information to be administrative and statistical collected; and DEPARTMENT OF LABOR procedures, furnishing and publishing *Minimize the burden of the information as to opportunities for collection of information on those who Employment and Training employment and other information of are required to respond, including Administration value in the operation of its system, and through the use of appropriate maintaining a system for clearing labor automated, electronic, mechanical, or Proposed Information Collection between the States. other technological collection Request; Submitted for Public Pursuant to the Wagner-Peyser Act, techniques or other forms of information Comment and Recommendations; the U.S. Department of Labor has Form ETA–232. The Domestic technology, e.g., permitting electronic established regulations at 20 CFR submissions of responses. Agricultural In-Season Wage Report, 653.500 covering the processing of and Form ETA–232–A, Wage Survey agricultural intrastate and interstate job A copy of the proposed information Interview Record orders. Section 563.501 provides that collection request (ICR) can be obtained the wage offered by employers must not by contacting the office listed above in ACTION: Notice. be less than the prevailing wage or the the addressee section of this notice. SUMMARY: The Department of Labor, as applicable Federal or State minimum III. Current Actions part of its continuing effort to reduce wage; whichever is higher. Also, the paperwork and respondent burden regulations for the temporary Activity covered by regulations at 20 conducts a pre-clearance consultation employment of alien agricultural and CFR 653.500 and 20 CFR part 655, program to provide the general public logging workers in the United States, 20 subparts B and C, particularly the H–2A and Federal agencies with an CFR part 655, subparts B and C, for the program, continues to expand, further opportunity to comment on the H–2A program, under the Immigration increasing the need for accurate and proposed and/or continuing collection Reform and Control Act of 1986, timely wage information on which to of information in accordance with the requires farmers and other agricultural base prevailing agricultural wage Paperwork Reduction Act of 1995 employers to pay workers the adverse determinations. There is no similar (PRA95) [44 U.S.C. 3506(c)(2)(A)]. This effect wage rate, the prevailing wage wage information which is available or program helps to ensure that requested rate, or the legal Federal or State can be used for these determinations data can be provided in the desired minimum wage rate; whichever is which apply to a specific crop of format, reporting burden (time and highest. livestock activity, in a specific The prevailing wage rate is used to financial resources) is minimized, agricultural wage reporting area for a implement these regulations covering collection instruments are clearly specific period of time during the peak intrastate and interstate recruitment of understood, and the impact of collection harvest season. farmworkers. The vehicle for Type of Review: Extension. requirements on respondents can be establishing the prevailing wage rate is properly assessed. Form ETA–232, The Domestic Agency: Employment and Training DATES: Submit comments on or before Agricultural In-Season Wage Report, Administration. January 27, 2004. and Form ETA–232–A, Wage Survey Title: Domestic Agricultural In-Season ADDRESSES: Send comments to John R. Interview Record. The ETA–232 Report Wage Report, Form ETA–232 and Wage Beverly, III, Administrator, Office of contains the prevailing wage finding Survey Interview Record, Form ETA– National Programs, Employment and based on survey data collected from 232–A. Training Administration, U.S. employers and reported by the States on OMB Number: 1205–0017. Department of Labor, Room C–4318, 200 Form ETA–232–A. Constitution Avenue, NW., Washington, Cite/Reference/Form/etc: ETA–232 DC 20210–0001, 202–693–3010 (this is II. Desired Focus of Comments and ETA 232–A, See below. not a toll-free number), fax 202–693– Currently, the Employment and Estimated Total Burden Hours: 2769. Training Administration is soliciting 16,301.

Average time Form/activity Total respond- Frequency Total re- per response Burden ents sponses (hours) (hours)

ETA–232 ...... 600 Annually ...... 600 11 6600

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66885

Average time Form/activity Total respond- Frequency Total re- per response Burden ents sponses (hours) (hours)

ETA–232–A ...... 38,805 Annually ...... 38,805 1⁄4 9,701

Totals ...... 39,405 ...... 16,301

Total Burden Cost (capital/startup): 0. character and in the localities specified ‘‘General Wage Determinations Issued Total Burden Cost (operating/ therein. Under The Davis-Bacon And Related maintaining): The determinations in these decisions Acts,’’ shall be the minimum paid by Business: The salary range of of prevailing rates and fringe benefits contractors and subcontractors to representatives of business respondents have been made in accordance with 29 laborers and mechanics. (employees of small family owned farms CFR part 1, by authority of the Secretary Any person, organization, or up through large agribusiness farms) can of Labor pursuant to the provisions of governmental agency having an interest be from the minimum wage to several the Davis-Bacon Act of , 1931, in the rates determined as prevailing is hundred thousand dollars for a CEO. as amended (46 Stat. 1494, as amended, encouraged to submit wage rate and Therefore, the hourly salaries of 40 U.S.C. 276a) and of other Federal fringe benefit information for individuals participating in the wage statutes referred to in 29 CFR part 1, consideration by the Department. survey ranges from $5.15 to $300 or appendix, as well as such additional Further information and self- more per hour. statutes as may from time to time be explanatory forms for the purpose of State Government: Average cost of the enacted containing provisions for the submitting this data may be obtained by State agencies conducting the payment of wages determined to be writing to the U.S. Department of Labor, Agricultural Wage Surveys range from prevailing by the Secretary of Labor in Employment Standards Administration, $1,500 to $6,000 per survey, depending accordance with the Davis-Bacon Act. Wage and Hour Division, Division of upon the complexity of the crop or The prevailing rates and fringe benefits Wage Determinations, 200 Constitution livestock activity to be surveyed, determined in these decisions shall, in Avenue, NW., Room S–3014, including considerations such as size of accordance with the provisions of the Washington, DC 20210. foregoing statutes, constitute the the employer and worker universe, and Modification to General Wage minimum wages payable on Federal and the geographic expanse of the wage Determination Decisions reporting areas. federally assisted construction projects Comments submitted in response to to laborers and mechanics of the The number of the decisions listed to this comment request will be specified classes engaged on contract the Government Printing Office summarized and/or included in the work of the character and in the document entitled ‘‘General Wage request for Office of Management and localities described therein. Determinations Issued Under the Davis- Budget approval of the information Good cause is hereby found for not Bacon and related Acts’’ being modified collection request; they will also utilizing notice and public comment are listed by Volume and State. Dates of become a matter of public record. procedure thereon prior to the issuance publication in the Federal Register are of these determinations as described in in parentheses following the decisions Dated: November 20, 2003. 5 U.S.C. 553 and not providing for delay being modified. Emily Stover DeRocco, in the effective date as prescribed in that Volume I Assistant Secretary, Employment and section, because the necessity to issue None Training Administration. current construction industry wage [FR Doc. 03–29665 Filed 11–26–03; 8:45 am] determinations frequently and in large Volume II BILLING CODE 4510–30–P volume causes procedures to be Pennsylvania: impractical and contrary to the public PA030001 (Jun. 13, 2003) interest. PA030002 (Jun. 13, 2003) DEPARTMENT OF LABOR General wage determination PA030004 (Jun. 13, 2003) decisions, and modifications and PA030006 (Jun. 13, 2003) Employment Standards PA030007 (Jun. 13, 2003) supersedea decisions thereto, contain no PA030008 (Jun. 13, 2003) Administration; Wage and Hour expiration dates and are effective from Division PA030009 (Jun. 13, 2003) their date of notice in the Federal PA030011 (Jun. 13, 2003) Minimum Wages for Federal and Register, or on the date written notice PA030016 (Jun. 13, 2003) Federally Assisted Construction; is received by the agency, whichever is PA030017 (Jun. 13, 2003) PA030018 (Jun. 13, 2003) General Wage Determination Decisions earlier. These decisions are to be used in accordance with the provisions of 29 PA030023 (Jun. 13, 2003) General wage determination decisions CFR parts 1 and 5. Accordingly, the PA030024 (Jun. 13, 2003) PA030025 (Jun. 13, 2003) of the Secretary of Labor are issued in applicable decision, together with any PA030026 (Jun. 13, 2003) accordance with applicable law and are modifications issued, must be made a PA030030 (Jun. 13, 2003) based on the information obtained by part of every contract for performance of PA030031 (Jun. 13, 2003) the Department of Labor from its study the described work within the PA030038 (Jun. 13, 2003) of local wage conditions and data made geographic area indicated as required by PA030059 (Jun. 13, 2003) available from other sources. They an applicable Federal prevailing wage PA030060 (Jun. 13, 2003) specify the basic hourly wage rates and law and 29 CFR part 5. The wage rates PA030065 (Jun. 13, 2003) West Virginia: fringe benefits which are determined to and fringe benefits, notice of which is WV030001 (Jun. 13, 2003) be prevailing for the described classes of published herein, and which are WV030002 (Jun. 13, 2003) laborers and mechanics employed on contained in the Government Printing WV030003 (Jun. 13, 2003) construction projects of a similar Office (GPO) document entitled WV030010 (Jun. 13, 2003)

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66886 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Volume III each volume. Throughout the remainder Dated: November 21, 2003. North Carolina: of the year, regular weekly updates will Robert M. Stephens, NC030001 (Jun. 13, 2003) be distributed to subscribers. Deputy General Counsel. NC030003 (Jun. 13, 2003) Signed at Washington, DC this 20th day of [FR Doc. 03–29724 Filed 11–26–03; 8:45 am] Volume IV November 2003. BILLING CODE 7510–01–P None Carl J. Poleskey, Chief, Branch of Construction Wage Volume V Determinations. None [FR Doc. 03–29447 Filed 11–26–03; 8:45 am] NATIONAL COMMUNICATIONS Volume VI BILLING CODE 4510–27–M SYSTEM Alaska: AK030001 (Jun. 13, 2003) National Security Telecommunications AK030002 (Jun. 13, 2003) NATIONAL AERONAUTICS AND Advisory Committee AK030003 (Jun. 13, 2003) SPACE ADMINISTRATION AK030005 (Jun. 13, 2003) AGENCY: National Communications AK030006 (Jun. 13, 2003) [Notice (03–149)] System (NCS). AK030008 (Jun. 13, 2003) Montana Notice of Prospective Patent License ACTION: Notice of closed meeting. MT030001 (Jun. 13, 2003) AGENCY: National Aeronautics and Volume VII SUMMARY: A meeting of the President’s Space Administration. National Security Telecommunications None ACTION: Notice of prospective patent Advisory Committee (NSTAC) will be General Wage Determination license. held via conference call on Thursday, Publication December 4, 2003, from 3 p.m. to 4 p.m. SUMMARY: NASA hereby gives notice The NSTAC is subject to the Federal General wage determinations issued that Air Systems, Inc., of 821 Juniper under the Davis-Bacon and related Acts, Advisory Committee Act (FACA), Pub. Crescent, Chesapeake, Virginia 23320, L. 92–463, as amended (5 U.S.C. App. including those noted above, may be has applied for a partially exclusive found in the Government Printing Office II). The conference call will be closed to license to practice the inventions the public to allow for discussion of: (GPO) document entitled ‘‘General Wage described and claimed in U.S. Patent Determinations Issued Under the Davis- No. 4,829,035 entitled ‘‘Reactivation Of • Industry Analysis of Open Bacon and Related Acts.’’ This A Tin Oxide-Containing Catalyst’’; U.S. Infrastructures Information publication is available at each of the 50 Patent No. 4,855,274 entitled ‘‘Process • Preliminary Industry Work Products, Regional Government Depository For Making A Noble Metal On Tin including Financial Services Task Libraries and many of the 1,400 Oxide Catalyst’’; U.S. Patent No. Force Findings/Trusted Access Task Government Depository Libraries across 4,912,082 entitled ‘‘Catalyst For Carbon Force Update the country. Monoxide Oxidation;’’ U.S. Patent No. General wage determinations issued • Assessment of Impact of a Recent 4,991,181 entitled ‘‘Catalyst For Carbon under the Davis-Bacon and related Acts NSTAC Policy Publication Monoxide Oxidation;’’ U.S. Patent No. are available electronically at no cost on 5,585,083 entitled ‘‘Catalytic Process Since revealing details of the industry the Government Printing Office site at For Formaldehyde Oxidation;’’ U.S. analysis of open infrastructures could www.access.gpo.gov/davisbacon. They Patent No. 6,132,694 entitled ‘‘Catalyst reveal predominantly internal agency are also available electronically by For Oxidation Of Volatile Organic records that would significantly risk subscription to the Davis-Bacon Online Compounds;’’ and the invention circumvention of industry regulations Service (http:// disclosed in NASA Case No. LAR intended to protect critical davisbacon.fedworld.gov) of the 15851–1–CU entitled ‘‘Process For infrastructures, closing this portion of National Technical Information Service Coating Substrates With Catalyst the meeting is consistent with 5 U.S.C. (NTIS) of the U.S. Department of Materials,’’ for which a U.S. Patent 552b(c)(4). Also, in order to foster a Commerce at 1–800–363–2068. This Application was filed; all of which are frank discussion on the industry subscription offers value-added features assigned to the United States of America analysis of open infrastructure matters, such as electronic delivery of modified as represented by the Administrator of consistent with 5 U.S.C. 552b(c)(4), it is wage decisions directly to the user’s the National Aeronautics and Space necessary to close this portion of the desktop, the ability to access prior wage Administration. Written objections to meeting to protect proprietary decisions issued during the year, the prospective grant of a license should information. Based on the sensitivity of extensive Help desk Support, etc. be sent to NASA Langley Research these topics, this conference call will be Hard-copy subscriptions may be Center. NASA has not yet made a closed. purchased from: Superintendent of determination to grant the requested Documents, U.S. Government Printing FOR FURTHER INFORMATION CONTACT: Call license and may deny the requested Office, Washington, DC 20402, (202) Ms. Kiesha Gebreyes, (703) 607–6134, or license even if no objections are 512–1800. write the Manager, National submitted within the comment period. When ordering hard-copy Communications System, 701 South subscription(s), be sure to specify the DATE(S): Responses to this notice must Court House Road, Arlington, Virginia State(s) of interest, since subscriptions be received by December 15, 2003. 22204–2198. may be ordered for any or all of the six FOR FURTHER INFORMATION CONTACT: separate Volumes, arranged by State. Helen M. Galus, Patent Attorney, Mail Gary D. Amato, Subscriptions include an annual edition Stop 212, NASA Langley Research Federal Register Liaison Officer, National (issued in January or February) which Center, Hampton, VA 23681–2199. Communications System. includes all current general wage Telephone (757) 864–3227; fax (757) [FR Doc. 03–29629 Filed 11–28–03; 8:45 am] determinations for the States covered by 864–9190. BILLING CODE 5001–08–M

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66887

NEIGHBORHOOD REINVESTMENT Week of December 8, 2003—Tentative SECURITIES AND EXCHANGE CORPORATION Tuesday, December 9, 2003 COMMISSION Regular Board of Directors Meeting 1:30 p.m. Briefing on Equal [Release No. IC–26259] Employment Opportunity Program, Notice of Applications for TIME AND DATE: 2 p.m. Wednesday, (Public Meeting) (Contact: Corenthis Deregistration Under Section 8(f) of the , 2003. Kelley, 301–415–7380). Investment Company Act of 1940 PLACE: Federal Deposit Insurance Wednesday, December 10, 2003 Corporation, 550 17th Street, NW., November 21, 2003. Room 6221, Sixth Floor, Washington, 9:30 a.m. Briefing on Strategic The following is a notice of DC 20429. Workforce Planning and Human Capital applications for deregistration under Initiatives (Closed—Ex. 2). STATUS: Open/Closed. section 8(f) of the Investment Company Act of 1940 for the month of November, FOR FURTHER INFORMATION CONTACT: Week of December 15, 2003—Tentative 2003. A copy of each application may be Jeffrey T. Bryson, General Counsel/ Tuesday, December 16, 2003 obtained for a fee at the SEC’s Public Secretary, (202) 220–2372; 9:30 a.m. Discussion of Security [email protected]. Reference Branch, 450 Fifth St., NW., Issues (Closed—Ex.1). Washington, DC 20549–0102, tel. (202) AGENDA: Week of , 2003—Tentative 942–8090. An order granting each I. Call to Order application will be issued unless the II. Approval of Minutes: September 5, There are no meetings scheduled for SEC orders a hearing. Interested persons 2003—Regular Meeting the Week of December 22, 2003. may request a hearing on any III. Audit Committee Meeting—10/28/03 Week of December 29, 2003—Tentative application by writing to the SEC’s IV. Treasurer’s Report Secretary at the address below and There are no meetings scheduled for V. Executive Directors Quarterly serving the relevant applicant with a Management Report the Week of December 29, 2003. * The schedule for Commission copy of the request, personally or by a. NeighborWorks Center for meetings is subject to change on short mail. Hearing requests should be Homeownership Presentation notice. To verify the status of meetings received by the SEC by 5:30 p.m. on b. NeighborWorks Visibility Goals and call (recording)—(301) 415–1292. December 16, 2003, and should be Strategies Contact person for more information: R. accompanied by proof of service on the VI. Executive Session—(Closed) Michelle Schroll, (301) 415–1662. applicant, in the form of an affidavit or, a. Personnel Committee Meeting—9/ for lawyers, a certificate of service. * * * * * Hearing requests should state the nature 24/03 Additional Information: b. Personnel Committee Meeting—11/ By a vote of 3–0 on November 19, the of the writer’s interest, the reason for the 5/03 Commission determined pursuant to request, and the issues contested. c. Update on Executive Director’s U.S.C. 552b(e) and § 9.107(a) of the Persons who wish to be notified of a Search Commission’s rules that ‘‘Affirmationof hearing may request notification by VII. Adjournment (1) Final Rule to Rule to Revise 10 CFR writing to the Secretary, SEC, 450 Fifth Part 71 to be Compatible with IAEA Street NW., Washington, DC 20549– Jeffrey T. Bryson, 0609. General Counsel/Secretary. Transportation Safety Standards [TS–R– 1] and Make Other NRC–Initiated FOR FURTHER INFORMATION CONTACT: [FR Doc. 03–29816 Filed 11–25–03; 11:55 am] Changes’’ be held on November 20, and Diane L. Titus at (202) 942–0564, SEC, on less than one week’s notice to the Division of Investment Management, BILLING CODE 7570–01–M public. Office of Investment Company * * * * * Regulation, 450 Fifth Street NW., The NRC Commission Meeting Washington, DC 20549–0504. NUCLEAR REGULATORY Schedule can be found on the Internet The First Philippine Fund Inc. [File No. COMMISSION at: www.nrc.gov/what-we-do/policy- 811–5902] making/schedule.html. Sunshine Act Meeting * * * * * Summary: Applicant, a closed-end This notice is distributed by mail to investment company, seeks an order AGENCY HOLDING THE MEETING: Nuclear several hundred subscribers; if you no declaring that it has ceased to be an Regulatory Commission. longer wish to receive it, or would like investment company. On , DATES: Weeks of November 24, to be added to the distribution, please 2003, applicant made a final liquidating December 1, 8, 15, 22, 29, 2003. contact the Office of the Secretary, distribution to its shareholders based on net asset value. Expenses of $95,115 PLACE: Commissioners’ Conference Washington, DC 20555 (301–415–1969). In addition, distribution of this meeting incurred in connection with the Room, 11555 Rockville Pike, Rockville, liquidation were paid by applicant. Maryland. notice over the Internet system is available. If you are interested in Filing Dates: The application was STATUS: Public and Closed. receiving this Commission meeting filed on August 4, 2003, and amended Matters to Be Considered: schedule electronically, please send an on October 30, 2003. Applicant’s Address: 575 Madison Week of November 24, 2003 electronic message to [email protected]. Ave., New York, NY 10022. There are no meetings scheduled for Dated: November 21, 2003. Morgan Stanley Strategic Adviser Fund the Week of November 24, 2003. Dave Gamberoni, Office of the Secretary. Inc. [File No. 811–8303] Week of December 1, 2003—Tentative [FR Doc. 03–29785 Filed 11–25–03; 10:03 Summary: Applicant seeks an order There are no meetings scheduled for am] declaring that it has ceased to be an the Week of December 1, 2003. BILLING CODE 7590–01–M investment company. On April 1, 2003,

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66888 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

applicant made a final liquidating reorganization were paid by applicant’s Oppenheimer Concentrated Growth distribution to its shareholders, based investment adviser, Credit Suisse Asset Fund [File No. 811–10047] on net asset value. Expenses of $20,200 Management, LLC, and/or its affiliates. Summary: Applicant seeks an order incurred in connection with the Filing Date: The application was filed declaring that it has ceased to be an liquidation were paid by applicant and on November 3, 2003. investment company. On May 16, 2003, applicant’s investment adviser, Morgan Applicant’s Address: 466 Lexington applicant made a liquidating Stanley Investment Management, Inc. Ave., New York, NY 10017. distribution to its shareholders, based Filing Date: The application was filed on net asset value. Applicant incurred on November 5, 2003. St. Clair Funds, Inc. [File No. 811–4038] Applicant’s Address: 1221 Avenue of no expenses in connection with the The Munder Funds Trust [File No. 811– the Americas, New York, NY 10020. liquidation. 5899] Filing Date: The application was filed Aon Funds [File No. 811–6422] on November 5, 2003. Summary: Each applicant seeks an Summary: Applicant seeks an order order declaring that it has ceased to be Applicant’s Address: 6803 South declaring that it has ceased to be an an investment company. By June 13, Tucson Way, Englewood, CO 80112. investment company. On December 3, 2003, all series of applicants had For the Commission, by the Division of 2002, applicant made a liquidating transferred their assets to corresponding Investment Management, pursuant to distribution to its shareholders, based series of Munder Series Trust, based on delegated authority. on net asset value. Expenses of $24,089 net asset value. Expenses of $60,305 and Margaret H. McFarland, incurred in connection with the $174,185, respectively, incurred in Deputy Secretary. liquidation were paid by applicant. connection with the reorganizations [FR Doc. 03–29621 Filed 11–26–03; 8:45 am] Filing Date: The application was filed were paid by applicants. BILLING CODE 8010–01–P on October 31, 2003. Applicant’s Address: 200 East Filing Date: The applications were filed on November 5, 2003. Randolph St., Chicago, IL 60601. SECURITIES AND EXCHANGE Applicants’ Address: 480 Pierce St., COMMISSION Venus Series Trust [File No. 811–9717] Birmingham, MI 48009. Summary: Applicant seeks an order Credit Suisse Institutional International declaring that it has ceased to be an [Investment Company Act Release No. Fund, Inc. [File No. 811–8933] investment company. On October 18, 26260; 812–13019] 2002, applicant made a liquidating Summary: Applicant seeks an order Hennion & Walsh, Inc., et al.; Notice of distribution to its shareholders, based declaring that it has ceased to be an Application on net asset value. Expenses of investment company. On August 22, approximately $1,000 incurred in 2003, applicant transferred its assets to November 21, 2003. connection with the liquidation were Credit Suisse Institutional Fund, Inc., AGENCY: Securities and Exchange paid by Venus Capital Management, based on net asset value. Expenses of Commission (‘‘Commission’’). applicant’s investment adviser. $140,000 incurred in connection with ACTION: Notice of application under Filing Date: The application was filed the reorganization were paid by section 6(c) of the Investment Company on October 27, 2003. applicant’s investment adviser, Credit Act of 1940 (the ‘‘Act’’) for an Applicant’s Address: 31 Milk St., Suisse Asset Management, LLC, and/or Third Floor, Boston, MA 02109. exemption from section 12(d)(3) of the its affiliates. Act. SmithGraham Institutional Funds [File Filing Date: The application was filed No. 811–21112] on November 4, 2003. SUMMARY OF APPLICATION: The requested order would permit certain series of unit Summary: Applicant seeks an order Applicant’s Address: 466 Lexington investment trusts to invest up to 10.5%, declaring that it has ceased to be an Ave., New York, NY 10017. 14.5% or 34.5% of their respective total investment company. On September 22, Credit Suisse Global Health Sciences assets in securities of issuers that 2003, applicant made a liquidating Fund, Inc. [File No. 811–7901] derived more than 15% of their gross distribution to its shareholders, based revenues in their most recent fiscal year on net asset value. Expenses of $8,350 Credit Suisse Global Technology Fund, from securities related activities incurred in connection with the Inc. [File No. 811–8935] (‘‘Securities Related Issuers’’). liquidation were paid by Smith, Graham Summary: Each applicant seeks an APPLICANTS: Hennion & Walsh, Inc. & Co. Investment Advisors, L.P., order declaring that it has ceased to be (‘‘Sponsor’’); Smart Trust, The Pinnacle applicant’s investment adviser. an investment company. On September Family of Trusts, Schwab Trusts, Equity Filing Date: The application was filed 26, 2003 and , 2003, Securities Trust, and EST Symphony on October 28, 2003. respectively, each applicant transferred Trust (‘‘Trusts’’); all presently Applicant’s Address: c/o PFPC Inc., its assets to Credit Suisse Global Post- outstanding and subsequently issued 400 Bellevue Parkway, Wilmington, DE Venture Capital Fund, Inc., based on net series of the Trusts (‘‘Series’’); and all 19809. asset value. Expenses of $150,000 and future unit investment trusts (‘‘UITs’’) $200,000, respectively, incurred in Credit Suisse Investment Grade Bond containing qualified securities and connection with the reorganizations Fund, Inc. [File No. 811–5600] sponsored or co-sponsored by the were paid by applicants’ investment Summary: Applicant seeks an order Sponsor or a sponsor controlling, adviser, Credit Suisse Asset declaring that it has ceased to be an controlled by, or under common Management, LLC, and /or its affiliates. investment company. On October 10, control, within the meaning of section 2003, applicant transferred its assets to Filing Date: The applications were 2(a)(9) of the Act, with the Sponsor Credit Suisse Fixed Income Fund, based filed on November 4, 2003. (these UITs are included in the term on net asset value. Expenses of $145,000 Applicants’ Address: 466 Lexington Trusts and their series included in the incurred in connection with the Ave., New York, NY 10017. term Series).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66889

FILING DATES: The application was filed value of its total assets in the single more than 10.5%, of the value of its on September 12, 2003, and amended stock that is the second lowest priced total assets in a Securities Related Issuer on November 12, 2003. stock of the Focus Five (the in the Top Ten, and to permit a Triple HEARING OR NOTIFICATION OF HEARING: An ‘‘Penultimate Pick’’). A Triple Strategy Strategy Series to invest up to order granting the application will be Series will invest no more than 10.5% approximately 10%, but in no event issued unless the Commission orders a with respect to the Top Ten, 14.5% with more than 10.5%, of the value of its hearing. Interested persons may request respect to the Focus Five, or 34.5% with total assets in a Securities Related Issuer a hearing by writing to the respect to the Penultimate Pick, if the in the Top Ten, approximately 14%, but Commission’s Secretary and serving Penultimate Pick is itself a Securities in no event more than 14.5%, of the applicants with a copy of the request, Related Issuer, of the value of its total value of its total assets in a Securities personally or by mail. Hearing requests assets in a Securities Related Issuer. Related Issuer in the Focus Five, and should be received by the Commission 2. The DJIA comprises 30 widely-held approximately 34%, but in no event by 5:30 p.m. on December 16, 2003, and common stocks listed on the New York more than 34.5%, of the value of its should be accompanied by proof of Stock Exchange that are chosen by the total assets in the Penultimate Pick, if service on applicants, in the form of an editors of The Wall Street Journal. The the Penultimate Pick is itself a affidavit or, for lawyers, a certificate of DJIA is the property of Dow Jones & Securities Related Issuer. Each of the service. Hearing requests should state Company, Inc., which is not affiliated Top Ten Series and Triple Strategy the nature of the writer’s interest, the with any Series, the Sponsor, or any co- Series will comply with all of the reason for the request, and the issues sponsor and does not participate in any conditions of rule 12d3–1, except the contested. Persons who wish to be way in the creation of any Series or the condition prohibiting an investment notified of a hearing may request selection of its stocks. The securities company from investing more than 5% notification by writing to the deposited in each Dow Series will be of the value of its total assets in Commission’s Secretary. chosen solely according to the formula securities of a Securities Related Issuer. ADDRESSES: Secretary, Securities and described above. The Sponsor will not 4. Applicants state that section Exchange Commission, 450 Fifth Street, have any discretion as to which 12(d)(3) was designed to prevent certain NW, Washington, DC, 20549. securities are purchased. Sales of potential conflicts of interest and to Applicants, Hennion & Walsh, Inc., securities in the Dow Series’ portfolios eliminate certain reciprocal practices 2001 Route 46, Hilltop Plaza, will be made in connection with between investment companies and Parsippany, NJ 07054. redemptions and at termination of the securities related businesses. One Trust on a date specified a year in FOR FURTHER INFORMATION CONTACT: potential conflict of interest could occur advance. The Sponsor does not have Marc R. Ponchione, Senior Counsel, at if an investment company purchased discretion as to when the securities will (202) 942–7927, or Mary Kay Frech, securities or other interests in a broker- be sold except in extremely limited Branch Chief, at (202) 942–0564 dealer to reward that broker-dealer for circumstances, such as default by the (Division of Investment Management, selling investment company shares, issuer in the payment of amounts due Office of Investment Company rather than solely on investment merit. on a security or the institution of certain Regulation). Applicants state that this concern does legal proceedings against the issuer. SUPPLEMENTARY INFORMATION: The not arise in connection with the Top following is a summary of the Applicants’ Legal Analysis Ten Series and the Triple Strategy application. The complete application 1. Section 12(d)(3) of the Act Series because neither the Series nor the may be obtained for a fee at the prohibits, with limited exceptions, an Sponsor has discretion in choosing the Commission’s Public Reference Branch, investment company from acquiring any portfolio securities or the amount 450 Fifth Street, NW., Washington, DC, security issued by any person who is a purchased. Applicants also state that the 20549 (telephone 202–942–8090). broker, dealer, underwriter, an effect of a Series’ purchase on the stock investment adviser of an investment of a Securities Related Issuer would be Applicants’ Representations company, or a registered investment de minimis because the common stocks 1. Each Trust is a UIT registered adviser. Rule 12d3–1 under the Act represented in the DJIA are widely held under the Act and consists of various exempts the purchase of securities of an and have active markets. Series. The Sponsor is a sponsor of the issuer that derived more than fifteen 5. Applicants state that another Series. The investment objective of percent of its gross revenues in its most potential conflict of interest could occur certain Series is to seek a greater total recent fiscal year from securities related if an investment company directed return than the stocks comprising the activities, provided that, among other brokerage to a broker-dealer in which Dow Jones Industrial Average (‘‘DJIA,’’ things, immediately after an acquisition, the investment company has invested to and the Series, ‘‘Dow Series’’). Certain the acquiring company has not invested enhance the broker-dealer’s profitability of the Dow Series (‘‘Top Ten Series’’) more than 5% of the value of its total or to assist it during financial difficulty, will invest approximately 10% of the assets in the securities of the issuer. even though that broker-dealer may not value of its total assets in each of the ten 2. Section 6(c) of the Act provides that offer the best price and execution. To common stocks in the DJIA that have the SEC may exempt a person from any preclude this type of conflict, applicants the highest dividend yields (the ‘‘Top provision of the Act or any rule under agree, as a condition to the requested Ten’’). In no event will a Top Ten Series the Act, if and to the extent that the order, that no company held in a Series’ invest more than 10.5% of the value of exemption is necessary or appropriate portfolio, nor any affiliated person of its total assets in the common stock of in the public interest and consistent that company, will act as a broker for a Securities Related Issuer in the Top with the protection of investors and the any Series in the purchase or sale of any Ten. Certain other Dow Series (‘‘Triple purposes fairly intended by the policy security for its portfolio. Strategy Series’’) will invest 20% of the and provisions of the Act. Applicants’ Condition value of its total assets in the Top Ten, 3. Applicants request an exemption 60% of the value of its total assets in the under section 6(c) from section 12(d)(3) Applicants agree that the order five lowest priced stocks of the Top Ten to permit a Top Ten Series to invest up granting the requested relief will be (the ‘‘Focus Five’’), and 20% of the to approximately 10%, but in no event subject to the following condition:

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66890 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

No company held in the Series’ portfolios contested. Persons who wish to be providing investors with a nor any affiliated person of that company notified of a hearing may request professionally selected, diversified will act as a broker for any Series in the notification by writing to the portfolio of investment company shares purchase or sale of any securities for the Commission’s Secretary. through a single investment vehicle. Series’ portfolios. ADDRESSES: Secretary, Commission, 450 Applicants’ Legal Analysis For the Commission, by the Division of Fifth Street, NW., Washington, DC, Investment Management, under delegated 20549–0609. Applicants, 1001 A. Section 12(d)(1) authority. Warrenville Road, Lisle, IL 60532. Margaret H. McFarland, 1. Section 12(d)(1)(A) of the Act FOR FURTHER INFORMATION CONTACT: prohibits a registered investment Deputy Secretary. Emerson S. Davis, Sr., Senior Counsel, company from acquiring shares of an [FR Doc. 03–29656 Filed 11–26–03; 8:45 am] at (202) 942–0714, or Annette Capretta, investment company if such securities BILLING CODE 8010–01–P Branch Chief, at (202) 942–0564 represent more than 3% of the total (Division of Investment Management, outstanding voting stock of the acquired Office of Investment Company company, more than 5% of the total SECURITIES AND EXCHANGE Regulation). COMMISSION assets of the acquiring company, or, SUPPLEMENTARY INFORMATION: The together with the securities of any other [Investment Company Act Release No. following is a summary of the investment companies, more than 10% 26261; 812–12877] application. The complete application of the total assets of the acquiring may be obtained for a fee at the company. Section 12(d)(1)(B) of the Act First Trust Portfolios, L.P., et al.; Commission’s Public Reference Branch, prohibits a registered open-end Notice of Application 450 Fifth Street, NW., Washington, DC, investment company from selling its November 21, 2003. 20549–0102 (tel. 202–942–8090). shares to another investment company if the sale will cause the acquiring AGENCY: Securities and Exchange Applicants’ Representations Commission (‘‘Commission’’). company to own more than 3% of the 1. The Trust is a UIT registered under acquired company’s voting stock, or if ACTION: Notice of an application for an the Act. Each Trust Series will be a order under section 12(d)(1)(J) of the the sale will cause more than 10% of the series of a Trust, each a UIT which is acquired company’s voting stock to be Investment Company Act of 1940 (the or will be registered under the Act.1 The ‘‘Act’’) for an exemption from sections owned by investment companies Sponsor, an Illinois limited partnership, generally. Section 12(d)(1)(C) prohibits 12(d)(1)(A), (B) and (C) of the Act and is registered under the Securities under sections 6(c) and 17(b) of the Act an investment company, other Exchange Act of 1934 as a broker-dealer. investment companies having the same for an exemption from section 17(a) of 2. Applicants request relief to permit the Act. investment adviser, and companies a Trust Series to invest in (a) registered controlled by such investment investment companies that are part of SUMMARY OF THE APPLICATION: FT Series companies, from acquiring more than the same ‘‘group of investment 10% of the outstanding voting stock of (the ‘‘Trust’’) and any registered unit companies’’ (as that term is defined in investment trusts (‘‘UITs’’) organized in a registered closed-end management section 12(d))(1)(G) of the Act) as the investment company. the future and sponsored by First Trust Trust (‘‘Affiliated Funds’’), and (b) Portfolios, L.P. (‘‘Sponsor’’), and their 2. Section 12(d)(1)(G) provides, in registered investment companies that relevant part, that section 12(d)(1) will respective series (together with the are not part of the same group of Trust, the ‘‘Trusts’’, and each series of not apply to securities of a registered investment companies as the Trust open-end investment company or UIT the Trusts, a ‘‘Trust Series’’), request an (‘‘Unaffiliated Funds,’’ together with order to permit the Trusts to acquire acquired by a registered UIT if the Affiliated Funds, the ‘‘Funds’’). The acquired company and the acquiring shares of registered management Unaffiliated Funds may include UITs investment companies and UITs both company are part of the same group of (‘‘Unaffiliated Underlying Trusts’’) and investment companies, provided that within and outside the same group of open-end or closed-end management investment companies. certain other requirements contained in investment companies (‘‘Unaffiliated section 12(d)(1)(G) are met. Applicants APPLICANTS: First Trust Portfolios, L.P. Underlying Funds’’). Certain of the state that they may not rely on section and FT Series. Unaffiliated Underlying Trusts or 12(d)(1)((G) because a Trust Series may FILING DATES: The application was filed Unaffiliated Underlying Funds may be invest in Unaffiliated Funds in addition on August 28, 2002 and amended on ‘‘exchange-traded funds’’ that are to Affiliated Funds. November 10, 2003. registered under the Act as UITs or 3. Section 12(d)(1)(J) of the Act HEARING OR NOTIFICATION OF HEARING: An open-end management investment provides that the Commission may order granting the requested relief will companies and have received exemptive exempt any person, security, or be issued unless the Commission orders relief to sell their shares on a national transaction or any class or classes of a hearing. Interested persons may securities exchange at negotiated persons, securities or transactions, from request a hearing by writing to the prices.1 any provision of section 12(d)(1) if the Commission’s Secretary and serving 3. Applicants state that the requested exemption is consistent with the public applicants with a copy of the request, relief will benefit unitholders by interest and the protection of investors. personally or by mail. Hearing requests Applicants request an exemption under should be received by the Commission 1 All Trusts that currently intend to rely on the section 12(d)(1)(J) to permit a Trust requested order are named as applicants. Any other by 5:30 p.m. on December 16, 2003, and Trust that relies on the order in the future will Series to acquire shares of a Fund and should be accompanied by proof of comply with the terms and conditions of the to permit a Fund to sell shares to a Trust service on applicants, in the form of an application. Series beyond the limits set forth in affidvavit or, for lawyers, a certificate of 1 All Trusts that currently intend to rely on the sections 12(d)(1)(A), (B) and (C). requested order are named as applicants. Any other service. Hearing requests should state Trust that relies on the order in the future will 4. Applicants state that the proposed the nature of the writer’s interest, the comply with the terms and conditions of the arrangement will not give rise to the reason for the request, and the issues application. policy concerns underlying sections

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66891

12(d)(1)(A), (B) and (C), which include rule 12b–1 under the Act (‘‘12b1– with the general purposes of the Act. concerns about undue influence by a Fees’’)) received by the Sponsor or Section 6(c) of the Act permits the fund of funds over underlying funds, Trustee, or an affiliated person of the Commission to exempt any person or excessive layering of fees, and overly Sponsor or Trustee, from an Unaffiliated transactions from any provision of the complex fund structures. Accordingly, Fund in connection with the investment Act if such exemption is necessary or applicants believe that the requested by a Trust Series in the Unaffiliated appropriate in the public interest and exemption is consistent with the public Fund. consistent with the protection of interest and the protection of investors. 8. Applicants believe that the investors and the purposes fairly 5. Applicants state that the proposed proposed arrangement will not create an intended by the policy and provisions of arrangement will not result in undue overly complex fund structure. the Act. influence by a Trust Series or its Applicants note that a Fund will be 4. Applicants submit that the affiliates over Funds. To limit the prohibited from acquiring securities of proposed arrangement satisfies the control that a Trust Series may have any investment company in excess of standards for relief under sections 6(c) over an Unaffiliated Fund, applicants the limits contained in section and 17(b) of the Act. Applicants state propose a condition prohibiting the 12(d)(1)(A) of the Act. Applicants also that the terms of the arrangement are Sponsor, the Trust Series, and certain represent that a Trust Series’ prospectus fair and reasonable and do not involve affiliates (individually or in the and sales literature will contain concise, overreaching. Applicants note that the aggregate) from controlling an ‘‘plain English’’ disclosure designed to consideration paid for the sale and Unaffiliated Fund within the meaning of inform investors of the unique redemption of shares of the Funds will section 2(a)(9) of the Act. To further characteristics of the trust of funds be based on the net asset values of the limit the potential for undue influence structure, including, but not limited to, Funds. Applicants state that the over Unaffiliated Funds, applicants its expense structure and the additional proposed arrangement will be consistent propose conditions 2 through 6, stated expenses of investing in Funds. with the policies of each Trust Series below, to preclude a Trust Series and its and Fund, and with the general B. Section 17(a) affiliated entities from taking advantage purposes of the Act. of an Unaffiliated Fund with respect to 1. Section 17(a) of the Act generally Applicants’ Conditions transactions between the entities and to prohibits sales or purchases of securities ensure that transactions will be on an between a registered investment Applicants agree that the order arm’s length basis. company and any affiliated person of granting the requested relief will be 6. As an additional assurance that an the company. Section 2(a)(3) of the Act subject to the following conditions: Unaffiliated Underlying Fund defines an ‘‘affiliated person’’ of another 1. (a) The Sponsor, (b) any person understands the implication of an person to include (a) any person directly controlling, controlled by, or under investment by a Trust Series under the or indirectly owning, controlling, or common control with the Sponsor, and requested order, prior to a Trust Series holding with power to vote, 5% or more (c) any investment company and any investment in an Unaffiliated of the outstanding voting securities of issuer that would be an investment Underlying Fund in excess of the limit the other person; (b) any person 5% or company but for section 3(c)(1) or in section 12(d)(1)(A)(i), the Trust Series more of whose outstanding voting section 3(c)(7) of the Act sponsored or and Unaffiliated Underlying Fund will securities are directly or indirectly advised by the Sponsor or any person execute an agreement stating that the owned, controlled, or held with power controlling, controlled by, or under board of directors of the Unaffiliated to vote by the other person; and (c) any common control with the Sponsor Underlying Fund and the investment person directly or indirectly controlling, (collectively, the ‘‘Group’’) will not adviser to the Unaffiliated Underlying controlled by, or under common control control (individually or in the aggregate) Fund understand the terms and with the other person. an Unaffiliated Fund within the conditions of the order and agree to 2. Applicants state that a Trust Series meaning of section 2(a)(9) of the Act. If, fulfill their responsibilities under the and Affiliated Funds might be deemed as a result of a decrease in the order. Applicants note that an to be under the common control of the outstanding voting securities of an Unaffiliated Underlying Fund may Sponsor or an entity controlling, Unaffiliated Fund, the Group, in the choose to reject an investment from the controlled by, or under common control aggregate, becomes a holder of more Trust Series. with the Sponsor. Applicants also state than 25% of the outstanding voting 7. Applicants do not believe that the that a Trust Series and a Fund might securities of the Unaffiliated Fund, the proposed arrangement will result in become affiliated persons if the Trust Group will vote its shares in the same excessive layering of fees. Applicants Series acquires more than 5% of the proportion as the vote of all other state that a condition to the order would Fund’s outstanding voting securities. In holders of the Unaffiliated Fund’s provide that any sales charges and/or light of these possible affiliations, shares. service fees (as those terms are defined section 17(a) could prevent a Fund from 2. A Trust Series and its Sponsor, in Rule 2830 of the Conduct Rules of the selling shares to and redeeming shares promoter, and principal underwriter, National Association of Securities from a Trust Series. and any person controlling, controlled Dealers (‘‘NASD Conduct Rules’’) 3. Section 17(b) of the Act authorizes by, or under common control with any charged with respect to Units of a Trust the Commission to grant an order of those entities (each, a ‘‘Trust Series Series will not exceed the limits permitting a transaction otherwise Affiliate’’) will not cause any existing or applicable to a fund of funds as set forth prohibited by section 17(a) if it finds potential investment by the Trust Series in Rule 2830 of the NASD Conduct that (a) the terms of the proposed in shares of an Unaffiliated Fund to Rules. In addition, the trustee to a Trust transaction are fair and reasonable and influence the terms of any services or Series (‘‘Trustee’’) will waive or offset do not involve overreaching on the part transactions between the Trust Series or fees otherwise payable by the Trust of any person concerned; (b) the a Trust Series Affiliate and the Series in an amount at least equal to any proposed transaction is consistent with Unaffiliated Fund or its investment compensation (including fees paid the policies of each registered adviser, sponsor, promoter, and pursuant to a plan adopted by an investment company involved; and (c) principal underwriter, and any person Unaffiliated Underlying Fund under the proposed transaction is consistent controlling, controlled by, or under

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66892 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

common control with any of those Underwritings or to a benchmark such investment occurred, the first 2 years in entities. as a comparable market index; and (iii) an easily accessible place. 3. Once an investment by a Trust whether the amount of securities 8. The Trustee will waive or offset Series in the securities of an purchased by the Unaffiliated fees otherwise payable by a Trust Series Unaffiliated Underlying Fund exceeds Underlying Fund in Affiliated in amount at least equal to any the limits of section 12(d)(1)(A)(i) of the Underwritings and the amount compensation (including 12b-1 Fees) Act, the board of directors of the purchased directly from Underwriting received by the Sponsor or Trustee, or Unaffiliated Underlying Fund, Affiliates have changed significantly an affiliated person of the Sponsor or including a majority of the disinterested from prior years. The board of directors Trustee, from an Unaffiliated Fund in directors, will determine that any shall take any appropriate actions based connection with the investment by a consideratation paid by the Unaffiliated on its review, including, if appropriate, Trust Series in the Unaffiliated Fund. Underlying Fund to a Trust Series or a the institution of procedures designed to 9. Any sales charges and/or service Trust Series Affiliate in connection with assure that purchases of securities from fees (as those terms are defined in rule any services or transactions: (i) Is fair Affiliated Underwritings are in the best 2830 of the NASD Conduct Rules) and reasonable in relation to the nature interests of shareholders. charged with respect to Units of a Trust and quality of the services and benefits 6. An Unaffiliated Underlying Fund Series will not exceed the limits received by the Unaffiliated Underlying shall maintain and preserve applicable to a fund of funds as set forth Fund; (ii) is within the range of permanently in an easily accessible in rule 2830 of the NASD Conduct consideration that the Unaffiliated place a written copy of the procedures Rules. Underlying Fund would be required to described in the preceding condition, 10. No Fund will acquire securities of pay to another unaffiliated entity in and any modifications, and shall any other investment company in excess connection with the same services or maintain and preserve for a period not of the limits contained in section transactions; and (iii) does not involve less than six years from the end of the 12(d)(1)(A) of the Act. overreaching on the part of any person fiscal year in which any purchase from concerned. an Affiliated Underwriting occurred, the For the Commission, by the Division of 4. No Trust Series or Trust Series Investment Management, pursuant to first two years in an easily accessible delegated authority. Affiliate will cause an Unaffiliated Fund place, a written record of each purchase to purchase a security from any made once an investment by a Trust Margaret H. McFarland, underwriting or selling syndicate in Series in the securities of an Deputy Secretary. which a principal underwriter is the Unaffiliated Underlying Fund exceeded [FR Doc. 03–29657 Filed 11–26–03; 8:45 am] Sponsor or a person of which the the limits of section 12(d)(1)(A)(i) of the BILLING CODE 8010–01–P Sponsor is an affiliated person (each an Act, setting forth from whom the ‘‘Underwriting Affiliate’’). An offering securities were acquired, the identity of during the existence of an underwriting the underwriting syndicate’s members, SECURITIES AND EXCHANGE or selling syndicate of which a principal the terms of the purchase, and the COMMISSION underwriter is an Underwriting Affiliate information or materials upon which [Release No. 34–48822; File No. SR–OPRA– is considered an ‘‘Affiliated the board’s determinations were made. 2003–01] Underwriting.’’ 7. Prior to an investment by a Trust 5. The board of directors of an Series in an Unaffiliated Underlying Options Price Reporting Authority; Unaffiliated Underlying Fund, Fund in excess of the limit in section Notice of Filing of and Order including a majority of the disinterested 12(d)(1)(A)(i), the Trust Series and the Approving on a Temporary Basis Not directors, will adopt procedures Unaffiliated Underlying Fund will To Exceed 120 Days a Proposed reasonably designed to monitor any execute an agreement stating, without Amendment to the Plan for Reporting purchases by the Unaffiliated limitation, that the board of directors of of Consolidated Options Last Sale Underlying Fund of securities in the Unaffiliated Underlying Fund and Reports and Quotation Information and Affiliated Underwritings once an the investment adviser to the Amendments No. 1 and 2 Thereto To investment by a Trust Series in the Unaffiliated Underlying Fund Revise the Manner in which the securities of the Unaffiliated Underlying understand the terms and conditions of Options Price Reporting Authority Fund exceeds the limits of section the order and agree to fulfill their Engages in Capacity Planning and 12(d)(1)(A)(i) of the Act, including any responsibilities under the order. At the Allocates Its Available System purchases made directly from an time of its investment in shares of an Capacity Among the Parties to the Plan Underwriting Affiliate. The board of Unaffiliated Underlying Fund in excess directors will review these purchases of the limit in section 12(d)(1)(A)(i), a November 21, 2003. periodically, but no less frequently than Trust Series will notify the Unaffiliated I. Introduction annually, to determine whether the Underlying Fund of the investment. At purchases were influenced by the such time, the Trust Series also will Pursuant to Section 11A of the investment by the Trust Series in shares transmit to the Unaffiliated Underlying Securities Exchange Act of 1934 of the Unaffiliated Underlying Fund. Fund a list of the names of each Trust (‘‘Act’’) 1 and Rule 11Aa3–2 The board of directors will consider, Series Affiliate and Underwriting thereunder,2 notice is hereby given that among other things, (i) whether the Affiliate. The Trust Series will notify on , 2003 the Options Price purchases were consistent with the the Unaffiliated Underlying Fund of any Reporting Authority (‘‘OPRA’’) investment objectives and policies of changes to the list as soon as reasonably submitted to the Securities and the Unaffiliated Underlying Fund; (ii) practicable after a change occurs. The Exchange Commission (‘‘Commission’’) how the performance of securities Unaffiliated Underlying Fund and the an amendment to the Plan for Reporting purchased in an Affiliated Underwriting Trust Series will maintain and preserve of Consolidated Options Last Sale compares to the performance of a copy of the order, the agreement, and Reports and Quotation Information comparable securities purchased during the list with any updated information a comparable period of time in for a period not less than 6 years from 1 15 U.S.C. 78k–1. underwritings other than Affiliated the end of the fiscal year in which any 2 17 CFR 240.11Aa3–2.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66893

(‘‘OPRA Plan’’ or ‘‘Plan’’).3 The The principal purpose of the manner that may result in the proposed amendment would revise the proposed amendment is to revise the information being made available to any manner in which OPRA engages in OPRA Plan in response to the of the parties to the Plan, or to use it in capacity planning and allocates capacity Commission’s Order instituting public any manner that is otherwise among the exchanges that are parties to administrative proceedings against four inconsistent with the ISCA’s obligation the Plan. On , 2003, OPRA of OPRA’s participant exchanges (Amex, to hold the information in confidence.10 submitted Amendment No. 1 to the CBOE, PCX and Phlx, referred to The ISCA may share this information proposal.4 On , 2003, OPRA collectively as the ‘‘respondent with the parties only in the form of submitted Amendment No. 2 to the exchanges’’) pursuant to Section aggregate capacity requests that do not proposal.5 This order approves the 19(h)(1) of the Act,7 and specifically in identify the individual capacity requests proposal as modified by Amendments response to Section IV.B.c. of the Order of any of the parties. The ISCA would No. 1 and 2 for a temporary period not (the ‘‘Undertaking’’). The Undertaking then determine how and when to to exceed 120 days, and solicits requires each of the four respondent modify the OPRA System in order to comment on the proposal, as amended exchanges, acting jointly with all other provide to each party the capacity it has by Amendments No. 1 and 2.6 The text options exchanges,8 to modify the requested and how the cost of such of the proposed Plan amendment, as structure and operation of OPRA in modifications is to be allocated among amended, is available at OPRA, the various ways that would eliminate the parties all in accordance with and Commission’s Public Reference Room, much of the need for joint and collective subject to the proposed Capacity and on the Commission’s Web site. action in the capacity planning and Guidelines that are incorporated in the allocation process. The three specific Plan as part of the proposed II. Description and Purpose of the requirements of the Undertaking and the amendment. Under the proposed Amendment manner in which the proposed amendment, each party would be Under the proposed Plan amendment, amendment is intended to satisfy these entitled to the capacity it has requested OPRA proposes to revise the manner in requirements are described below. and would be obligated to authorize and which OPRA engages in capacity The respondent exchanges must fund the modifications of the OPRA planning and allocates its available establish a system for procuring and System in accordance with the ISCA’s system capacity among the exchanges allocating options market data determinations and the specific cost that are parties to the Plan. OPRA also transmission capacity that eliminates allocation provisions of the proposed proposes to amend Subsections I(a) and joint action by the participants in OPRA Capacity Guidelines. I(b) of the OPRA Plan to make it clear in determining the amount of total The proposed Capacity Guidelines that participation in OPRA is limited to capacity procured and the allocation describe the function and authority of those self-regulatory organizations thereof, and provides that each the ISCA and its procedures in greater (‘‘SROs’’) that are engaged in the participant in OPRA would detail than in the Plan itself. Under the business of providing a market for the independently determine the amount of procedures specified in the proposed trading of securities options and other capacity it would obtain. Capacity Guidelines, the ISCA would eligible securities under the OPRA Plan. The proposed amendment to the promptly review the capacity OPRA Plan (reflected in proposed new projections and requests it receives from 3 OPRA is a national market system plan the parties, would discuss proposed approved by the Commission pursuant to Section Section III(g) and related definitions) 11A of the Act and Rule 11Aa3–2 thereunder. See would require each party to the Plan modifications with OPRA’s Policy and Securities Exchange Act Release No. 17638 (March from time to time to independently Technical Committees and the OPRA 18, 1981), 22 S.E.C. Docket 484 (March 31, 1981). project the capacity it would need and Processor, and would discuss with each The OPRA Plan provides for the collection and to privately submit requests for capacity party that has requested additional dissemination of last sale and quotation information capacity the ISCA’s estimate of the cost on options that are traded on the participant based on its projections to an ISCA, exchanges. The five participants to the OPRA Plan which would maintain these individual to that party of providing the capacity are the American Stock Exchange LLC (‘‘Amex’’), capacity projections and requests in it requested. In every case, the ISCA the Chicago Board Options Exchange, Inc. would report to OPRA concerning any (‘‘CBOE’’), the International Securities Exchange, confidence. The proposed definition of Inc. (‘‘ISE’’), the Pacific Exchange, Inc. (‘‘PCX’’), and the ISCA in Section II(m) of the Plan modifications to the OPRA System that the Philadelphia Stock Exchange, Inc. (‘‘Phlx’’). would require the ISCA to maintain the it believes are called for in response to 4 See letter from Michael L. Meyer, Counsel to confidentiality of this information, the parties’ aggregate projections and OPRA, Schiff, Hardin & Waite, to Deborah Flynn, requests. In these discussions and Assistant Director, Division of Market Regulation consistent with the provisions of (‘‘Division’’), Commission, dated July 15, 2003, Section III(g) of the Plan.9 Revised reports, no information from any party replacing in its entirety the initial proposal filed on Section III(g) of the Plan would clarify would be disclosed to any other party April 15, 2003 (‘‘Amendment No. 1’’). In that confidential capacity-related except in the form of aggregate Amendment No. 1, OPRA provides additional projections or requests. In addition, discussion of the proposed Capacity Guidelines that information obtained by the ISCA describe the function, authority, and procedures of would not be used by the ISCA in any OPRA proposes in Guideline No. 1 of the Independent System Capacity Advisor (‘‘ISCA’’) of its other business activities in a the Capacity Guidelines to require the and clarified in the proposed Plan’s language and ISCA to maintain internal safeguards corresponding discussion that the selection of the 7 and procedures adequate to assure that ISCA is subject to being filed with the Commission Order Instituting Public Administrative as an amendment to the Plan, to be put into effect Proceedings Pursuant to Section 19(h)(1) of the Act, the requirements of the Plan pertaining upon filing. Making Findings and Imposing Remedial Sanctions. to the confidentiality of information 5 See letter from Michael L. Meyer, Counsel to Securities Exchange Act Release No. 43268, dated provided to the ISCA would be September 11, 2000 and Administrative Proceeding OPRA, Schiff, Hardin & Waite, to Deborah Flynn, satisfied.11 Under the proposed Assistant Director, Division, Commission, dated File 3–10282 (‘‘Order’’). October 15, 2003 (‘‘Amendment No. 2’’). In 8 ISE is not a respondent exchange subject to the amendment to the Plan, the person Amendment No. 2, OPRA specifies in the proposed Order. Nevertheless, as a party to the OPRA Plan, designated to act as the ISCA, before it Plan’s language and the proposed Capacity ISE participated fully in all of the discussions that begins to act in that capacity, would be Guidelines the ISCA’s obligation to maintain the led to the approval of the proposed amendment, confidentiality of the information entrusted to it by and it joined with the other parties in approving the required to furnish a written description OPRA’s participants in the capacity planning proposed amendment and authorizing its filing process. with the Commission. 10 Id. 6 17 CFR 240.11Aa3–2(c)(4). 9 See Amendment No. 2, supra note . 11 Id.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66894 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

of these internal safeguards and be limited as follows: (i) The ISCA the Options Clearing Corporation procedures to the Commission.12 could not authorize a modification to (‘‘OCC’’) to act as the ISCA upon the The proposed Capacity Guidelines the OPRA System that, together with effectiveness of the proposed also provide that, in allocating OPRA’s other capacity increases previously amendment to the Plan. OCC is a capacity-related costs among the parties, authorized by the ISCA, represents an registered clearing agency that, while the first $5 million of costs in any year increase in the total capacity of the nominally owned by the five options would be allocated as currently System in excess of 15,000 messages per exchanges, is an independent entity that provided under the OPRA Plan, based second over the immediately preceding is not controlled by any exchange. Each on the relative trading volume of each twelve months unless at least 75% of of the five exchanges owns a 20% of the parties. Costs above this amount the parties consent to such increase; (ii) interest in OCC, so that, on the basis of would be allocated in a fair and the ISCA could not authorize a stock ownership alone, no exchange has equitable manner as determined by the modification to the OPRA System if the a controlling interest. However, OPRA ISCA. The $5 million amount would be Processor disagrees with any material believes that OCC’s independence is subject to adjustment on an annual aspect of the manner or scope of the assured in ways that go beyond stock basis, if approved by 75% of the parties. modification unless at least 75% of the ownership. Pursuant to the bylaws of A prospective new options exchange parties consent to such modification; OCC, its 16-person Board of Directors would have to inform the ISCA, at least and (iii) the ISCA could not authorize a consists of one Director from each of the 6 months prior to the time it proposes modification to the OPRA System that five exchanges, nine representatives of to commence trading, of the initial makes major changes to the System, OCC clearing member firms, one Public amount of system capacity it would such as changing the types of servers Director, and one Management Director. need. The costs of providing initial used in the System or changing the The exchanges have no voice in the system capacity to an applicant in communication protocols used in the selection of Member Directors, the accordance with its request, as network unless at least 75% of the Public Director, or the Management determined by the ISCA, would be parties consent to such modification. Director. Thus each exchange has only included in the applicant’s Participation As a limited exception to the a 6.25% representation on the OCC Fee payable under Section 1(b) of the allocation of System capacity in Board, and all of the exchanges together OPRA Plan. Also, under Guideline No. accordance with the parties’ requests represent only 31.25% of the Board. 6 of the proposed Capacity Guidelines, and the ISCA’s determinations, a OPRA believes that OCC’s if the new party has not received the provision is made in proposed new independence has long been recognized capacity it has requested at the time it Section III(h) of the Plan for a party, on by the exchanges and by the has commenced trading options, and to an anonymous basis, to offer to acquire Commission. This is reflected not only the extent there is any excess capacity additional capacity from, or make in the selection of OCC to act as the available in the system that has not been excess capacity available to, another ISCA by the unanimous vote of all five provided to any of the parties, the ISCA party. Furthermore, to promote the most exchanges, but in OCC’s other roles as would be able to allocate to the new efficient utilization of available the central issuer and clearing agency party all or a portion of any such excess capacity, OPRA proposes in Section for options traded on five competing capacity in order to provide the new III(g) of the Plan to provide for the exchanges, as the developer and party with the amount of capacity continued utilization of a ‘‘dynamic manager of the intermarket options determined by the ISCA to be sufficient throttle,’’ so as to automatically make linkage facility pursuant to the Options to satisfy the reasonable needs of the available to a party with an immediate Intermarket Linkage Plan,15 and as the new party until it has been provided need for additional capacity, on a short- arbiter of the eligibility of underlying with the capacity it initially requested. term interruptible basis, any unused stocks for options trading pursuant to The proposed Capacity Guidelines capacity that may then be available. A the Options Listing Procedures Plan.16 would permit the ISCA to provide less party receiving additional capacity by OCC serves in these capacities with the than all of the capacity requested by the operation of the dynamic throttle would approval of all five exchanges and with parties if the ISCA determines that: (1) be required to pay for it at an above-cost the Commission’s approval, which The capacity requests of one or more of rate, so as to discourage parties from OPRA believes stands as an the parties are unreasonable, or (2) it is submitting unrealistically low capacity acknowledgement of OCC’s not reasonable to develop or maintain a requests in the belief that some unused independence. system that has capacity sufficient to capacity of other parties would always The respondent exchanges must 13 satisfy the requests of the parties. The be available to them. establish a system for gathering and ISCA would be authorized to allocate Furthermore, under the proposed disseminating business information system capacity among the parties amendment, future Plan amendments, from and to participants of OPRA such under circumstances when available including amendments to the proposed that all nonpublic information specific capacity is insufficient to provide each new provisions of the Plan pertaining to to a participant in OPRA shall remain party with the capacity it has requested; capacity planning and allocation, would segregated and confidential from other however, the ISCA would not be continue to require the unanimous approval of the parties. However, authorized to require any party to give 15 Securities Exchange Act Release Nos. 43086 up any capacity previously provided to decisions relating to the selection or (July 28, 2000), 65 FR 48023 (August 4, 2000) (order it at the party’s request, other than in termination of the ISCA, certain changes approving the Linkage Plan submitted by Amex, response to a major systems failure or to the authority of the ISCA, and CBOE, and ISE); 43574 (November 16, 2000), 65 FR 70850 (November 28, 2000) (order approving PCX 14 changes to the Capacity Guidelines may other catastrophe. In addition, the as participant in the Options Intermarket Linkage ISCA’s authority to modify the OPRA be authorized by a vote of 75% of the Plan); and 43573 (November 16, 2000), 65 FR 70851 System and to obligate the parties to pay parties. In addition, the selection of the (November 28, 2000) (order approving Phlx as a the costs of such modifications would ISCA would be required to be filed with participant in the Options Intermarket Linkage the Commission as an amendment to Plan). 16 See Securities Exchange Act Release No. 44521 12 Id. OPRA’s national market system plan. (, 2001), 66 FR 36809 (, 2001) (order 13 Guideline No. 1, Capacity Guidelines. In accordance with this requirement, approving a proposed options listing procedures 14 Guideline No. 6, Capacity Guidelines. this filing reflects OPRA’s selection of plan by Amex, CBOE, ISE, OCC, PCX, and Phlx).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66895

participants (except for information that The respondent exchanges must set (‘‘NYSE’’), after it disposed of its entire may be shared in connection with joint forth a statement of OPRA’s functions options trading program and thereby activities permitted as necessary to and objectives as permitted under the ceased to have any interest in the fulfill the functions and objectives of Exchange Act, and provide for rules and activities of OPRA, nevertheless OPRA as stated in the Plan). procedures that limit any joint action remained a party to the OPRA Plan with As noted in the discussion above, the with respect to OPRA by the the same voting rights and other rights proposed amendment would require participants in OPRA to circumstances of participation in OPRA as every other each party’s individual capacity in which such joint action is necessary party to the Plan. projections and requests to be submitted in order to fulfill the stated functions Although the situation pertaining to to the ISCA in confidence, and the ISCA and objectives. the status of the NYSE as a party to the would be expressly prohibited from The functions and objectives of OPRA OPRA Plan was recently resolved when sharing this information with any of the are specifically set forth in the OPRA the NYSE voluntarily withdrew from other parties, except in the form of Plan as it is proposed to be amended, OPRA, the current parties to the Plan aggregate information that does not most particularly in the preamble to the believe it is necessary to amend the Plan identify the individual capacity requests Plan and in Section III(b) thereof. These to clarify the status under the Plan of of any of the other parties. The ISCA functions and objectives include: (1) exchanges that continue to have rules would be required under Section II(m) Determining the manner in which last governing the trading of options even of the Plan to maintain the sale reports, quotation information, and though they no longer are involved in options trading. The parties believe it is confidentiality of this information, other market information will be especially important to clarify the consistent with the provisions of collected, consolidated, and matter of eligibility to be a party to the Section III(g) of the Plan, which would disseminated in satisfaction of the Plan in light of the other amendments specify that confidential capacity- requirements of the Act and establishing to the OPRA Plan that are proposed related information obtained by the the formats for such consolidated herein dealing with capacity planning ISCA would not be used by the ISCA in information; (2) contracting for and and capacity allocation. The parties any of its other business activities in a maintaining facilities to support these believe that only those exchanges that manner that may result in the activities, prescribing forms of contracts actually maintain a market for the information being made available to any to be entered into by vendors, trading of standardized options should of the parties to the Plan, or to use it in subscribers, and other persons, and any manner that is otherwise have a voice in these critical capacity- making policy determinations related issues. inconsistent with the ISCA’s obligation pertaining to such contracts; (3) to hold the information in confidence.17 The parties to the OPRA Plan believe establishing standards concerning the it is consistent with Section 11A of the Furthermore, Guideline No. 1 of the qualifications of different categories of proposed Capacity Guidelines would Act 20 and Rule 11Aa3–2 thereunder 21 recipients of consolidated information; to limit participation in OPRA to those require the ISCA to maintain internal (4) determining fees to be paid for safeguards and procedures adequate to SROs that provide a market in the types access to consolidated information as of securities that are covered by the assure that the requirements of the Plan permitted under the Act; (5) pertaining to the confidentiality of OPRA Plan. OPRA believes that determining policy questions pertaining subparagraph (a)(3)(B) of Section 11A 22 information provided to the ISCA would to OPRA’s budgetary and other financial 18 authorizes the Commission, ‘‘in be satisfied. A written description of matters; (6) managing the capacity of the these internal safeguards and furtherance of the directive in paragraph OPRA System in accordance with procedures would have to be furnished (2) of this subsection [which includes determinations made by the ISCA as to the Commission before the ISCA the directive to assure the availability to described above; and (7) otherwise begins to act in that capacity.19 brokers, dealers and investors of In addition, OPRA proposes to amend making all policy decisions necessary in information with respect to quotations Section III(b) of the Plan to make furtherance of the objectives of the Act. for and transactions in securities] * * * explicit the requirement that each The proposed amendment makes to authorize or require [SROs] to act person who performs administrative explicit in the preamble to the Plan that jointly with respect to matters as to functions for OPRA, including its joint action by the parties to the Plan is which they share authority under this Executive Director and other officials limited to those matters as to which title in planning, developing, operating, and its processor, shall agree that any they share authority under the Plan, and or regulating a national market system nonpublic business information then only to circumstances where such (or a subsystem thereof) or one of more pertaining to any party shall be held in joint action is necessary in order to facilities thereof.’’ [Emphasis supplied.] confidence and not be shared with the fulfill the functions and objectives of Similarly, OPRA believes that paragraph other parties, except for information that OPRA as stated in the Plan. (b)(3) of Rule 11Aa3–2 under the Act 23 may be shared in connection with In addition to the above described authorizes SROs ‘‘to act jointly in (i) permitted joint activities. Finally, OPRA amendments pertaining directly to planning, developing, and operating any proposes to make explicit in the OPRA’s capacity planning and national market subsystem or facility preamble to the Plan that the parties allocation functions and conforming contemplated by a national market themselves are each obligated to take definitional and editorial modifications, system plan * * * or (iii) implementing reasonable steps to insure that their OPRA also proposes to amend or administrating an effective national nonpublic business information remains subsections I(a) and I(b) of the OPRA market system plan.’’ OPRA believes segregated and confidential from the Plan to make it clear that a party to the that if an SRO does not share authority other parties, except for information that OPRA Plan ceases to be a party at such for national market system activities in may be shared in connection with time as it ceases to maintain a market respect of a particular type of security permitted joint activities. for the trading of standardized options. This aspect of the amendment is 20 15 U.S.C. 78k–1. 17 See Amendment No. 2, supra note 5. directed at the anomalous situation that 21 17 CFR 240.11Aa3–2. 18 Id. recently confronted OPRA when the 22 15 U.S.C. 78k–1(a)(3)(B). 19 Id. New York Stock Exchange, Inc. 23 17 CFR 240.11Aa3–2(b)(3).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66896 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

because it does not provide a market for comment on OPRA’s proposal that the Specifically, the Commission believes trading that type of security, then there first $5 million of OPRA’s capacity- that the proposed OPRA Plan appears to be no basis in the Act for related costs in any year would be amendment, which would revise the authorizing or requiring that SRO to allocated based on the relative trading manner in which OPRA engages in participate in that national market volume of each of the parties, while capacity planning and the allocation of system. OPRA’s costs above $5 million, as system capacity among the exchanges Finally, the proposed amendment proposed in Capacity Guideline No. 7, that are parties to the Plan, is sufficient expands the types of persons to whom would be allocated by the ISCA, and, in under Section 11A of the Act 25 and a party may disseminate proprietary particular, whether $5 million appears Rule 11Aa3–2 thereunder 26 for information pertaining to quotations to be an appropriate ceiling before the temporary approval not to exceed 120 and transactions in its market as an ISCA may begin allocating OPRA’s days in that it is in the public interest exception to the requirement of the Plan capacity-related costs. Furthermore, as and appropriate for the protection of that makes OPRA the exclusive channel part the of the ISCA’s limitations on investors and the maintenance of fair for the dissemination of this authority in proposed Capacity and orderly markets to assure the information. Under Section V(c)(iii) of Guideline No. 5, the ISCA may not availability to brokers, dealers, and the current Plan, a party may authorize a modification to the OPRA investors of information with respect to disseminate its proprietary information System that, together with other quotations for and transactions in outside of the OPRA System to its capacity increases previously securities. members for display on terminals used authorized by the ISCA, represents an to enter or transmit orders or quotes to increase in the total capacity of the Specifically, the Commission believes the party’s market and to other parties, System in excess of 15,000 messages per that OPRA’s proposal to require each provided that those members who have second over the immediately preceding party to the Plan to independently access to a party’s proprietary twelve months unless at least 75% of project the capacity it would need and information must also have equivalent the parties consent to such an increase. to confidentially submit requests for access to consolidated information The Commission seeks comment on capacity based on such projections to provided by OPRA, and provided whether such a limitation is the ISCA is designed to eliminate joint further that a party may not disseminate appropriate, and, if so, whether the action by the OPRA participants in proprietary information outside of 15,000 mps limitation imposed on the determining the amount of total OPRA on any more timely basis than the ISCA is reasonable, whether OPRA capacity procured and the allocation of same information is provided to OPRA. should use a higher threshold, and such capacity. The Commission notes The proposed amendment to the Plan whether commenters recommend using that the proposal would require that the would allow a party to disseminate its a threshold percentage based on OPRA’s ISCA maintain these individual capacity proprietary information outside of the capacity of the previous year instead of projections and requests in confidence, OPRA System to any person, provided a specified amount. and not use such confidential, capacity- that the requirements of the current Plan Persons making written submissions related information in any of its pertaining to equivalent access to should file six copies thereof with the business activities that may result in the consolidated data provided by OPRA Secretary, Securities and Exchange information being made available to any and to the timeliness of providing data Commission, 450 Fifth Street, NW., of the parties of the Plan, or to use such to OPRA would continue to apply. This Washington, DC 20549–0609. Copies of information in any manner that is proposed change reflects past the submission, all subsequent inconsistent with its obligation to hold experience with the electronic trading amendments, and all written statements the information in confidence. system of the ISE and the anticipated with respect to the proposal and Furthermore, the proposed Capacity expanded use of electronic trading Amendments No. 1 and 2 that are filed Guidelines would require the ISCA to systems by other parties, all of which with the Commission, and all written provide the Commission with a written necessarily involve the dissemination of communications relating to the proposal description of its internal safeguards proprietary information over systems and Amendments No. 1 and 2 between and procedures to ensure compliance that are separate from the OPRA System. the Commission and any person, other with the Plan’s confidentiality OPRA has come to recognize that than those withheld from the public in requirements prior to the time the ISCA persons in addition to members of a accordance with the provisions of 5 first exercises its authority under the party who enter quotes or orders into a U.S.C. 552, will be available for Plan. The Commission believes that party’s electronic market may benefit inspection and copying in the these requirements provide additional from having access to the party’s Commission’s Public Reference Room. assurance that each exchange’s non- electronic network. The proposed Copies of the filing will also be available public business information would amendment is intended to facilitate this, at the principal offices of OPRA. All remain segregated would not be made while at the same time assuring that all submissions should refer to File No. available to its competitors. persons who have access to a party’s SR–OPRA–2003–01 and should be Furthermore, the Commission proprietary information would also have submitted by December 19, 2003. emphasizes that neither the Plan nor the equivalent access to consolidated Capacity Guidelines should be market information provided by OPRA. IV. Discussion construed in any manner that would III. Solicitation of Comments After careful review, the Commission permit individual exchange capacity finds that the proposed OPRA Plan projections or requests or other Interested persons are invited to amendment, as amended by confidential, capacity-related submit written data, views, and Amendments No. 1 and 2, is sufficient information to be shared with the other arguments concerning the proposed under the Act and the rules and parties to the Plan. Plan amendment, as modified by regulations thereunder for temporary Amendments No. 1 and 2, including approval of not more than 120 days.24 impact on efficiency, competition, and capital whether the proposal and Amendments formation. 15 U.S.C. 78c(f). No. 1 and 2 are consistent with the Act. 24 In approving this proposed OPRA Plan 25 15 U.S.C. 78k–1. Specifically, the Commission requests amendment, the Commission has considered its 26 17 CFR 240.11Aa3–2.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66897

The Commission also believes that the on capacity. For these reasons, the Commission with the opportunity to proposed grant to the ISCA of the Commission believes that the ISCA may review OPRA’s choice of the ISCA. responsibility to allocate capacity- consider whether a party has made Under this Plan amendment, OPRA has related costs above a $5 million ceiling reasonable efforts to mitigate the proposed to select OCC to function as would allow the exchanges to avoid the amount of systems capacity that its the ISCA. Because of OCC’s status as an difficult task of having to differentiate market data requires of OPRA and other SRO, the Commission will be able to the costs and expenses attributable to market participants in determining monitor its obligations under the Plan to capacity expansion from the costs and whether a party does not have a maintain the exchanges’ individual expenses attributable to maintaining reasonable need for all the capacity it capacity projections and requests and operating the OPRA system. has requested. confidentially. However, as discussed above, the The Capacity Guidelines also provide The Commission believes that the Commission specifically requests that the ISCA may provide less than all proposed Capacity Guidelines comment on whether $5 million would the capacity requested if it determines adequately provide for the allocation of be an appropriate limit before the ISCA that it is not reasonable to develop or capacity to new parties to OPRA. Under may begin allocating the capacity- maintain a system that has capacity Guideline No. 2 of the proposed related costs among the parties. sufficient to satisfy the request of the Capacity Guidelines, a prospective new The Capacity Guidelines provide that parties. In this regard, the Capacity options exchange would have to inform the ISCA is ordinarily expected to Guidelines provide that the ISCA may the ISCA, at least 6 months prior to the provide the parties with the systems determine that it is not reasonable to time it proposes to commence trading, capacity they have requested. However, develop or maintain a system with all of of the initial amount of system capacity the ISCA has some discretion to provide the capacity that has been requested if less than all the capacity requested if it it concludes that it is not technically it would need. The ISCA would then determines that the capacity requests of feasible to do so, or that a significant aggregate this request for capacity with one or more of the parties are number of OPRA vendors cannot or will the requests received from the existing unreasonable. A party’s request may be not carry the amount of message traffic exchanges. Also, under Guideline No. 6 found by the ISCA to be unreasonable disseminated by such a system. Because of the proposed Capacity Guidelines, if if it concludes that a party does not have of the implications that increases in the new party has not received the a reasonable need for all the capacity it message traffic have on all users of capacity it has requested at the time it has requested within the timeframe to options market data, the Commission has commenced trading options, and to which the request applies. believes it is important that the ISCA the extent there is any excess capacity In 1999, the Commission ordered the consider the technical feasibility for all available in the system that has not been exchanges to discuss the feasibility of users of options market data, including provided to any of the parties, the ISCA strategies to avoid quote traffic vendors, brokers-dealers, and would be able to allocate to the new congestion, including quote mitigation party all or a portion of any such excess 27 customers, to develop or maintain a strategies. In that Order the system with all of the capacity that has capacity in order to provide the new Commission recognized that increases been requested. party with the amount of capacity in quote message traffic have In addition, the Commission notes determined by the ISCA to be sufficient implications not only for the options that, under the proposed Capacity to satisfy the reasonable needs of the exchanges, but all users of options Guidelines, the ISCA would not be new party until it has been provided market data. Moreover, the increase in permitted to increase systems capacity with the capacity it initially requested. quote message traffic has accelerated in excess of 15,000 mps during a twelve- These provisions in the proposed since the Commission issued that order. month period without the approval of Capacity Guidelines, which specifically As of September 2003, the exchanges’ 75% of the parties to the Plan. The contemplate new entrants and provide a peak dissemination of messages per Commission believes that some mechanism for them to acquire capacity, second was 15,000 messages per second. restriction on the ISCA’s authority is together with the prohibitions imposed As the options exchanges modify their important to prevent large increases in on the ISCA from using confidential trading rules to permit competing systems capacity, which could have a capacity-related information in any of market makers to independently quote, significant impact on down-stream users its other business activities that may it is anticipated that each exchange’s of OPRA data, such as vendors and result in the information being made demands on capacity will increase broker-dealers. available to any of the parties to the substantially. In addition, the Boston Furthermore, the Plan amendment Plan or in any manner inconsistent with Stock Exchange (‘‘BSE’’) has proposed would require OPRA to file its selection the ISCA’s obligations to hold such to operate a fully electronic options of the ISCA with the Commission as an information in confidence, are designed exchange, which would, if approved by amendment to the Plan, which would to ensure that the existing exchanges the Commission, place further demands become effective upon filing.28 This would not be able to restrain new requirement would provide the entrants from joining OPRA and 27 See Securities Exchange Act Release No. 41843 (September 8, 1999), 64 FR 50126 (September 15, acquiring the capacity that they require. 1999). In addition, the Commission staff sent a 28 Although filed effective upon filing, the Finally, the Commission finds that it letter to each of the options exchanges stating that Commission may, at any time within 60 days of the is appropriate to put the proposed the exchanges should continue to work together to, filing of the amendment, summarily abrogate the among other things, implement strategies to amendment and require that such amendment be OPRA Plan amendment, as modified by mitigate quote message traffic. See letters from refiled in accordance with paragraph (b)(1) to Rule Amendments No. 1 and 2, into effect Annette L. Nazareth, Director, Division, 11Aa3–2 under the Act and reviewed in accordance summarily upon publication of notice Commission to Salvatore F. Sodano, Chairman and with paragraph (c)(2) of the Rule, if it appears to Chief Executive Officer, Amex; William J. Brodsky, the Commission that such action is necessary or on a temporary basis not to exceed 120 Chairman and Chief Executive Officer, CBOE; David appropriate in the public interest, for the protection days to permit OPRA to implement the Krell, President and Chief Executive Officer, ISE; of investors or the maintenance of fair and orderly capacity planning process at the soonest Philip D. DeFeo, Chairman and Chief Executive markets, to remove impediments to, and perfect practicable time. Since September 2000, Officer, PCX; and Meyer S. Frucher, Chairman and mechanisms of a national market system or Chief Executive Officer, Phlx, dated September 13, otherwise in furtherance of the purposes of the Act. when the respondent exchanges entered 2000. 17 CFR 240.11Aa3–2(c)(3). into the Settlement Order with the

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66898 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Commission 29 and simultaneously, SECURITIES AND EXCHANGE (‘‘UTP’’). The text of the proposed rule consented to the entry of a Final COMMISSION change is set forth below. Proposed new language is in italics; proposed Judgment with the Department of [Release No. 34–48813; File No. SR–Amex– 30 Justice, the options exchanges have 2003–21] deletions are in [brackets]. interpreted those actions to preclude * * * * * them from engaging in joint capacity Self-Regulatory Organizations; Notice Types of Orders planning under the current OPRA Plan. of Filing of Proposed Rule Change and Since that time, the exchanges’ peak Amendments 1, 2, and 3 thereto by the Rule #131 dissemination of OPRA data has American Stock Exchange LLC (a) through (d) No change. increased from approximately 3,500 Relating to At-the-Close Orders and (e) [An at the close order is a market messages per second to more than Auxiliary Opening Procedures order which is to be executed at or as 15,000 messages per second, as of November 20, 2003. near to the close as practicable. The September 30, 2003. As the existing Pursuant to Section 19(b)(1) of the term ‘‘at the close order’’ shall also options exchanges modify their trading Securities Exchange Act of 1934 include a limit order that is entered for rules to permit competing market (‘‘Act’’),1 and Rule 19b–4 thereunder,2 execution at the closing price, on the makers to independently quote, it is notice is hereby given that on March 27, Exchange, of the stock named in the anticipated that each exchange’s 2003, the American Stock Exchange LLC order pursuant to such procedures as demands on capacity will increase (‘‘Amex’’ or ‘‘Exchange’’) filed with the the Exchange may from time to time substantially. In addition, the BSE has Securities and Exchange Commission establish.] A market at the close (MOC) proposed to operate a fully electronic (‘‘Commission’’) the proposed rule order is an order to buy or sell a stated options exchange, which would, if change as described in Items I, II and III amount of a security at the Exchange’s closing price. If the MOC order cannot approved by the Commission, place below, which Items have been prepared be so executed in its entirety at the further demands on capacity. by the Amex. On September 10, 2003, Exchange closing price it will be Accordingly, to permit the exchanges to the Amex amended the proposed rule 3 cancelled. A limit at the close (LOC) commence capacity planning without change. On October 20, 2003, the Amex amended the proposed rule change.4 On order is an order to buy or sell a stated the need for joint action, as required by amount of a security at the Exchange’s the Settlement Order, the Commission November 14, 2003, the Amex amended the proposed rule change.5 The closing price if that closing price is at believes it is necessary or appropriate in Commission is publishing this notice to the order’s limit price, or better. If the the public interest, for the protection of solicit comments on the proposed rule LOC order can not be so executed, in investors or the maintenance of fair and change from interested persons. whole or in part, the amount of the orderly markets, to remove impediments order not so executed is to be cancelled. to, and perfect mechanisms of, a I. Self-Regulatory Organization’s Cancellation of MOC and LOC orders national market system to approve the Statement of the Terms of Substance of will only occur in certain circumstances proposed amendment to the OPRA Plan the Proposed Rule Change such as (1) when trading has been on a temporary basis not to exceed 120 The Amex proposes (1) to adopt new halted in the security and does not days so that options market data can Rule 131A to set forth Exchange rules reopen prior to the close of the market; continue to be disseminated on a timely and procedures regarding ‘‘at the close’’ (2) for tick sensitive orders whose basis.31 orders; (2) to amend Amex Rules 131 execution will violate customer and 156 relating to on-close orders (also instructions (i.e., to buy only on a minus V. Conclusion known as ‘‘at-the-close’’ orders); (3) to or zero minus tick or to sell only on a implement additional procedures, It Is Therefore Ordered, pursuant to plus or zero plus tick) or Exchange Rule relating to daily on-close procedures Section 11A of the Act,32 and Rule 7; (3) for LOC orders, when the Amex and expiration day auxiliary opening closing price is not at the limit price or 11Aa3–2(c)(4) thereunder,33 that the procedures; and (4) to adopt new Rule better, or (4) for tick sensitive MOC/LOC proposed OPRA Plan amendment, as 118(m) to reflect procedures applicable orders and LOC orders, all of which are modified by Amendments No. 1 and 2, to ‘‘at the close’’ orders in Nasdaq limited to the closing price, the limited (SR–OPRA–2003–01) is approved on a securities traded on the Exchange quantity of shares to be traded and the temporary basis not to exceed 120 days. pursuant to unlisted trading privileges rules of priority as to which orders For the Commission, by the Division of would trade first left these orders Market Regulation, pursuant to delegated 1 15 U.S.C. 78s(b)(1). unexecuted in whole or in part. 2 authority.34 17 CFR 240.19b–4. (f) through (t) No change. 3 See letter from Claire P. McGrath, Senior Vice Margaret H. McFarland, President and Deputy General Counsel, Amex, to * * * * * Deputy Secretary. Nancy Sanow, Assistant Director, Division of Market Regulation (‘‘Division’’), Commission, dated Market on Close Policy and Expiration [FR Doc. 03–29658 Filed 11–26–03; 8:45 am] September 9, 2003 (‘‘Amendment No. 1’’). In Procedures BILLING CODE 8010–01–P Amendment No. 1, the Amex restated the proposed rule change in its entirety. Rule 131A. The following procedures 4 See letter from Claire P. McGrath, Senior Vice apply to stocks and do not apply to President and Deputy General Counsel, Amex, to options or to any security the pricing of Nancy Sanow, Assistant Director, Division, which is based on another security or an Commission, dated October 17, 2003 (‘‘Amendment 29 index (e.g., Exchange Traded Funds or See Order, supra note 7. No. 2’’). In Amendment No. 2, the Amex restated 30 United States v. American Stock Exchange, the proposed rule change in its entirety. Trust Issued Receipts, securities listed LLC et al. (, 2000), Civ. No. 00–CV– 5 See letter from Claire P. McGrath, Senior Vice under Section 107 of the Exchange 02174 (EGS). President and Deputy General Counsel, Amex, to Company Guide, warrants and 31 17 CFR 240.11Aa3–2(c)(4). Nancy Sanow, Assistant Director, Division, convertible securities). Commission, dated November 13, 2003 32 15 U.S.C. 78k–1. (‘‘Amendment No. 3’’). In Amendment No. 3, the (a) In an attempt to minimize price 33 17 CFR 240.11Aa3–2(c)(4). Amex restated the proposed rule change in its volatility on the close, all market-on- 34 17 CFR 200.30–3(a)(29). entirety. close (MOC) and limit-on-close (LOC)

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66899

orders should be entered as early in the 25,000 shares, either a ‘‘No Imbalance’’ whichever occurs first. This policy does day as possible to provide market notice will be published, or the size and not apply to non-regulatory (e.g., order participants an opportunity to better side of the imbalance may be published imbalance or equipment changeover) ascertain possible order imbalances that with Floor Official approval. halts, and cancellation of orders in such might exist at the close. MOC Imbalance Calculation Policy cases is prohibited after 3:40 p.m. Between 3:00 and 3:40 p.m. (Eastern (3:50 p.m. calculation): Procedures for except to correct an error. Cancellation Time), imbalances of any size may be the 3:50 p.m. calculation are the same or reduction in size of MOC and/or LOC published with Floor Official approval. as the 3:40 p.m. calculation, except that orders after 3:50 p.m. will not be These are informational only and do not the Exchange last sale at 3:50 p.m. permitted for any reason, including in limit MOC/LOC order entry before 3:40 would be used to determine whether or case of legitimate error. p.m. not a LOC order is marketable. (b) Printing the Close: In accordance At 3:40 p.m. or as close to this time (2) Between 3:40 p.m. and 3:50 p.m., with Rule 109(d), the imbalance of MOC as possible, MOC order imbalances of no MOC or LOC orders may be entered and marketable LOC orders are printed 25,000 shares or more must be except to offset a published MOC against the bid or the offer as the case published on the consolidated tape. In imbalance at 3:40 p.m. A broker may may be. addition, an order imbalance below represent an MOC or LOC order in the Following the printing of the 25,000 shares may also be published by crowd, but must state irrevocable MOC imbalance, and in accordance with Rule a specialist, with the concurrence of a interest by 3:40:00 p.m. After 3:40:00 109, the specialist shall stop the Floor Official, if the specialist (i) p.m., an MOC order may not be taken remaining buy and sell orders against anticipates that the execution of the from the book to be represented by a each other and pair them off at the price MOC orders will result in a closing price broker in the crowd. of the immediately preceding sale which exceeds the price change Between 3:40 p.m. and 3:50 p.m., described above. The ‘‘pair off’’ parameters of Rule 154, Commentary MOC and LOC orders are irrevocable, transaction shall be reported to the tape .08 (the $2, $1, $.50 Rule), or (ii) believes except to correct an error (e.g., incorrect that an order imbalance should stock, side, size, or price, or a as ‘‘stopped stock’’. Where the aggregate otherwise be published in an attempt to duplication of a previously entered size of the MOC (and marketable LOC, minimize price volatility on the close. A order). Properly cancelled MOC and i.e., orders with limits above the closing ‘‘No Imbalance’’ notice will only be LOC orders may not be replaced after price) orders to buy equals the aggregate published for any stock at 3:40 p.m. if 3:40 p.m. unless the replacement order size of the MOC (and marketable LOC, there had been a prior informational offsets a published MOC imbalance. i.e., orders with limits below the closing imbalance publication. After 3:50 p.m., no MOC or LOC price) orders to sell, the buy orders and (1) MOC Imbalance Calculation Policy orders may be entered except to offset sell orders shall be stopped against each (3:40 p.m. calculation): Marketable LOC a published MOC imbalance at 3:50 other and paired-off at the price of the orders to buy (that is, LOC buy orders p.m. last sale regular-way on the Exchange with limit prices above the last sale at Cancellation or reduction in size of prior to the close of trading in that stock 3:40 p.m.) are added to MOC orders to MOC and/or LOC orders after 3:50 p.m. on that day. The transaction shall be buy. Marketable LOC orders to sell (that will not be permitted for any reason, reported to the consolidated last sale is, LOC orders with limit prices below including in case of legitimate error. reporting system as ‘‘stopped stock’’. the last sale at 3:40 p.m.) are added to (3) Publication of Imbalances Any stop orders and percentage orders MOC orders to sell. The buy orders are Following Trading Halt of Any Type: that would be elected and become then matched against sell orders. If MOC order imbalances of 25,000 shares executable as a result of the closing there is a buy imbalance, it is offset and or more are required to be published by transaction should also be included in reduced by any tick-sensitive MOC the specialist, if practicable, in the event the close. orders to sell and tick-sensitive, a stock reopens after 3:50 p.m. following (c) Order of Execution of MOC and marketable LOC orders to sell (including a trading halt of any type. An imbalance LOC Orders. orders to sell short). If there is a sell of less than 25,000 shares may be On the close orders are to be executed imbalance it is offset and reduced by published with the concurrence of a in the following order. any tick-sensitive MOC orders to buy Floor Official. Trading will not resume 1. MOC orders (including ‘‘G’’); and tick-sensitive, marketable LOC in the event a trading halt in a stock 2. Tick-sensitive, marketable (as orders to buy. occurs after 3:55 p.m., and MOC/LOC defined in Rule 131A(b) above) MOC At 3:50 p.m. or as close to this time orders in that stock will not be executed. orders (not including sell short ‘‘G’’); as possible, MOC order imbalances of (4) Entry of MOC/LOC Orders During 3. Tick-sensitive, marketable (as 25,000 shares or more must be a Regulatory Halt. If a regulatory halt is defined in Rule 131A(b) above) market published on the consolidated tape. In in effect at 3:40 p.m. or occurs after that orders and marketable (as defined in addition, an order imbalance below time, the entry of MOC/LOC orders is Rule 131A(b) above) limit orders; 25,000 shares may also be published by permitted until 3:50 p.m. or until the a specialist, with the concurrence of a security reopens, whichever occurs first. 4. Marketable (as defined in Rule Floor Official, if the specialist (i) If an order imbalance is published 131A(b) above) LOC orders (including anticipates that the execution of the following a regulatory halt and ‘‘G’’); MOC orders will result in a closing price reopening after 3:40 p.m., the entry of 5. Tick-sensitive, marketable (as which exceeds the price change MOC/LOC orders is permitted only to defined in Rule 131A(b) above) LOC parameters of Rule 154, Commentary offset the published imbalance. orders (not including sell short ‘‘G’’); .08 (the $2, $1, $.50 Rule), or (ii) believes (5) Cancellation of MOC/LOC Orders 6. Limit orders on the book and in the that an order imbalance should During a Regulatory Halt. When a crowd limited to the closing price; otherwise be published in an attempt to regulatory halt (news pending or news 7. LOC orders limited to the closing minimize price volatility on the close. If dissemination) is in effect at 3:40 p.m. price; there had been an imbalance or occurs after that time, cancellation of 8. Tick-sensitive MOC orders limited publication at 3:40 p.m. and the MOC/LOC orders is permitted until 3:50 to the closing price (not including sell imbalance at 3:50 p.m. is less than p.m. or the reopening of the security, short ‘‘G’’);

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66900 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

9. Tick-sensitive LOC orders limited to and will accept market orders of 99,900 on a minus or zero minus tick or to sell the closing price (not including sell shares or less. ‘‘Limit-at-the-opening’’ only on a plus or zero plus tick) or short ‘‘G’’); (‘‘limit OPG’’) orders are permitted, Exchange Rule 7; (3) for LOC orders, 10. All other ‘‘G’’ orders on book and including delivery through Exchange when the Amex closing price is not at in the crowd. systems. Ordinary limit and market the limit price or better, or (4) for tick Item numbers 1–5 above (Order of orders may also be entered. sensitive MOC/LOC orders and LOC Execution of MOC Orders) are treated orders, all of which are limited to the Order Identification like MOC orders. Accordingly, the buy closing price, the limited quantity of side is matched against the sell side to Stock orders relating to expiring shares to be traded and the rules of determine the imbalance. That derivatives whose settlement pricing is priority as to which orders would trade imbalance will be executed against the based on opening prices must be first left these orders unexecuted in prevailing bid or offer, as appropriate. identified ‘‘OPG’’. whole or in part. (An imbalance of buy orders would be Firms entering these orders through (d) through (e) No change. executed against the offer. An AOF, but unable to use ‘‘OPG’’ in the * * * * * imbalance of sell orders would be order instructions, may use a unique executed against the bid.) The order of AOF branch code or a separate AOF Trading in Nasdaq National Market execution of the orders limited to that subscription mnemonic to identify these Securities bid or offer (i.e., the orders that the orders. The Amex Market Surveillance Rule 118 imbalance will trade against) is set forth Department must be advised in writing above in item numbers 6 through 10. of the branch code or subscription (a) through (k) No change. The specialist then stops the remaining mnemonics by the business day (l) Reserved. (m) Market-on-Close and Limit-on- buy and sell ‘‘MOC’’ orders (i.e., those following the expiration trade date. Close Orders ‘‘The following procedures not part of the imbalance) against each Firms unable to identify these orders apply to market-on-close (MOC) and other and pairs them off at the price of in any of the above three ways, and limit-on-close (LOC) orders in Nasdaq the imbalance trade. The ‘‘pair off’’ firms not using AOF, must submit a list National Market securities transaction is to be reported as a of all these orders and related details to (i) A market at the close (MOC) order ‘‘stopped stock’’ transaction. the Amex Market Surveillance is an order to buy or sell a stated (d) Auxiliary Opening Procedures. Department by the business day amount of a security at the Exchange’s For each expiration settlement value following the expiration trade date. day on which derivative, index-related closing price. If the MOC order cannot products (e.g., options, futures, options Dissemination of Order Imbalances be so executed in its entirety at the on futures) settle against opening prices, As soon as practicable after 9:00 a.m. Exchange closing price it will be several auxiliary procedures are on expiration days, the Exchange will cancelled. A limit at the close (LOC) necessary to integrate stock orders publish market order imbalances of order is an order to buy or sell a stated relating to expiring contracts into 25,000 shares or more in all stocks. In amount of a security at the Exchange’s Amex’s opening procedures in a manner addition, imbalances of less than 25,000 closing price if that closing price is at that assures an efficient market opening shares may be published at that time the order’s limit price, or better. If the in each stock as close to 9:30 a.m. as with Floor Official approval. A ‘‘no LOC order can not be so executed, in possible. An expiration settlement value imbalance’’ status will not be published whole or in part, the amount of the day is a trading day prior to the for any stock. order not so executed is to be cancelled. Cancellation of MOC and LOC orders expiration of index-related derivative * * * * * products whose settlement value is will only occur in certain circumstances based upon opening prices on the Representation of Orders such as (1) When trading has been halted in the security and does not Exchange, as identified by a qualified Rule 156 (a) through (b) No change. clearing corporation (e.g., the Options reopen prior to the close of the market; Clearing Corporation). The twelve (c) The acceptance of a market [an] at (2) for tick sensitive orders whose expiration days are ‘‘Expiration the close (MOC) order by a broker [does execution will violate customer Fridays’’ which generally fall on the not make him] makes the broker instructions (i.e., to buy only on a minus third Fridays in every month. If that responsible for an execution at the or zero minus tick or to sell only on a Friday is an Exchange holiday, there Exchange’s closing price, and if the plus or zero plus tick) or Exchange Rule will be an expiration Thursday in such order can not be so executed, it is to be 7; (3) for LOC orders, when the Amex a month. cancelled. A broker handling a limit at closing price is not at the limit price or the close (LOC) order is to use due better, or (4) for tick sensitive MOC/LOC Order Entry diligence to execute the order at the orders and LOC orders, all of which are Stock orders relating to index-related Exchange’s closing price if that closing limited to the closing price, the limited derivative contracts whose settlement price is at the order’s limit price, or quantity of shares to be traded and the pricing is based upon opening prices better, and if the order can not be so rules of priority as to which orders must be received by the Amex Order executed, in whole or in part, the would trade first left these orders File (AOF) or by the specialist by 9 a.m. amount of the order not so executed is unexecuted in whole or in part. These orders may be cancelled or to be cancelled. [Bids or offers qualified (ii) In an attempt to minimize price reduced in size. (Firms canceling these as at the close cannot be publicly made volatility on the close, all market-on- orders or reducing them in size shall in the Trading Crowd.] Cancellation of close (MOC) and limit-on-close (LOC) prepare contemporaneously a written MOC and LOC orders will only occur in orders should be entered as early in the record describing the rationale for the certain circumstances such as (1) when day as possible to provide market change and shall preserve it as Rule 153 trading has been halted in the security participants an opportunity to better provides.) All other orders may be and does not reopen prior to the close ascertain possible order imbalances that entered before or after 9 a.m. of the market; (2) for tick sensitive might exist at the close. To facilitate early order entry, AOF orders whose execution will violate Between 3:00 and 3:40 p.m. (Eastern will begin accepting orders at 7:30 a.m. customer instructions (i.e., to buy only Time), imbalances of any size may be

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66901

published with Floor Official approval. represent an MOC or LOC order in the permitted for any reason, including in These are informational only and do not crowd, but must state irrevocable MOC case of legitimate error. limit MOC/LOC order entry before 3:40 interest by 3:40 p.m. After 3:40 p.m., an (iii) Printing the Close: In accordance p.m. MOC order may not be taken from the with Rule 109(d), the imbalance of MOC (a) At 3:40 p.m. or as close to this time book to be represented by a broker in and marketable LOC orders are printed as possible, MOC order imbalances of the crowd. against the Exchange bid or the 25,000 shares or more must be Between 3:40 p.m. and 3:50 p.m., Exchange offer as the case may be. published in a manner specified by the MOC and LOC orders are irrevocable, Following the printing of the imbalance, Exchange. In addition, an order except to correct an error (e.g., incorrect and in accordance with Rule 109, the imbalance below 25,000 shares may stock, side, size, or price, or a specialist shall stop the remaining buy also be published by a specialist, with duplication of a previously entered and sell orders against each other and the concurrence of a Floor Official, if order). Properly cancelled MOC and pair them off at the price of the the specialist (i) anticipates that the LOC orders may not be replaced after immediately preceding sale described execution of the MOC orders will result 3:40 p.m. unless the replacement order above. The ‘‘pair off’’ transaction shall in a closing price which exceeds the offsets a published MOC imbalance. be reported as stopped stock in price change parameters of Rule 154, After 3:50 p.m., no MOC or LOC accordance with Exchange Rule 109, Commentary .08 (the $2, $1, $.50 Rule), orders may be entered except to offset Commentary .02. Where the aggregate or (ii) believes that an order imbalance a published MOC imbalance at 3:50 size of the MOC (and marketable LOC, should otherwise be published in an p.m. i.e., orders with limits above the closing attempt to minimize price volatility on Cancellation or reduction in size of price) orders to buy equals the aggregate the close. A ‘‘No Imbalance’’ notice will MOC and/or LOC orders after 3:50 p.m. size of the MOC (and marketable LOC, only be published for any stock at 3:40 will not be permitted for any reason, i.e., orders with limits below the closing p.m. if there had been a prior including in case of legitimate error. price) orders to sell, the buy orders and informational imbalance publication. (b) Prohibition of Tick-Sensitive sell orders shall be stopped against each (1) MOC Imbalance Calculation Policy Orders—Tick-sensitive MOC and LOC other and paired-off at the price of the (3:40 p.m. calculation): Marketable LOC orders (e.g., buy ‘‘minus’’ or sell ‘‘plus’’) last regular-way consolidated sale prior orders to buy (that is, LOC buy orders shall not be entered. (Sell short MOC to the close of trading in that stock on with limit prices above the consolidated and LOC orders in Nasdaq securities are that day. The transaction shall be last sale at 3:40 p.m.) are added to MOC exempt from tick restrictions on the reported as stopped stock in accordance orders to buy. Marketable LOC orders to Amex and may be entered.) with Exchange Rule 109, Commentary (c) Publication of Imbalances sell, (that is, LOC orders with limit .02. Stop orders and percentage orders Following Trading Halt of Any Type: prices below the last sale at 3:40 p.m.) elected by the execution of the MOC MOC order imbalances of 25,000 shares are added to MOC orders to sell. The imbalance should be included in the or more are required to be published by buy orders are then matched against sell close. orders to calculate the imbalance. the specialist, if practicable, in the event (iv) Order of Execution of MOC and At 3:50 p.m. or as close to this time a stock reopens after 3:50 p.m. following LOC Orders. as possible, MOC order imbalances of a trading halt of any type. An imbalance On the close orders are to be executed 25,000 shares or more must be of less than 25,000 shares may be in the following order. published in a manner specified by the published with the concurrence of a 1. MOC orders (including ‘‘G’’); Exchange. In addition, an order Floor Official. Trading will not resume 2. Marketable (as defined in Rule imbalance below 25,000 shares may in the event a trading halt in a stock 118(m)(iii) above) LOC orders (including also be published by a specialist, with occurs after 3:55 p.m., and MOC/LOC ‘‘G’’); the concurrence of a Floor Official, if orders in that stock will not be executed. 3. Limit orders on the book and in the the specialist (i) anticipates that the (d) Entry of MOC/LOC Orders During crowd limited to the closing price; execution of the MOC orders will result a Regulatory Halt. If a regulatory halt is 4. LOC orders limited to the closing in a closing price which exceeds the in effect at 3:40 p.m. or occurs after that price; price change parameters of Rule 154, time, the entry of MOC/LOC orders is 5. All other ‘‘G’’ orders on book and Commentary .08 (the $2, $1, $.50 Rule), permitted until 3:50 p.m. or until the in the crowd. or (ii) believes that an order imbalance security reopens, whichever occurs first. Item numbers 1 and 2 above (Order of should otherwise be published in an If an order imbalance is published Execution of MOC Orders) are treated attempt to minimize price volatility on following a regulatory halt and like MOC orders. Accordingly, the buy the close. If there had been an reopening after 3:40 p.m., the entry of side is matched against the sell side to imbalance publication at 3:40 p.m. and MOC/LOC orders is permitted only to determine the imbalance. That the imbalance at 3:50 p.m. is less than offset the published imbalance. imbalance will be executed against the 25,000 shares, either a ‘‘No Imbalance’’ (e) Cancellation of MOC/LOC Orders prevailing bid or offer, as appropriate. notice will be published, or the size and During a Regulatory Halt. When a (An imbalance of buy orders would be side of the imbalance may be published regulatory halt (news pending or news executed against the offer. An with Floor Official approval. dissemination) is in effect at 3:40 p.m. imbalance of sell orders would be MOC Imbalance Calculation Policy or occurs after that time, cancellation of executed against the bid.) The order of (3:50 p.m. calculation): Procedures for MOC/LOC orders is permitted until 3:50 execution of the orders limited to that the 3:50 p.m. calculation are the same p.m. or the reopening of the security, bid or offer (i.e., the orders that the as the 3:40 p.m. calculation, except that whichever occurs first. This policy does imbalance will trade against) is set forth the consolidated last sale at 3:50 p.m. not apply to non-regulatory (e.g., order above in item numbers 3 through 5. The would be used to determine whether or imbalance or equipment changeover) specialist then stops the remaining buy not a LOC order is marketable. halts, and cancellation of orders in such and sell ‘‘MOC’’ orders (i.e., those not (2) Between 3:40 p.m. and 3:50 p.m., cases is prohibited after 3:40 p.m. part of the imbalance) against each no MOC or LOC orders may be entered except to correct an error. Cancellation other and pairs them off at the price of except to offset a published MOC or reduction in size of MOC and/or LOC the imbalance trade. The ‘‘pair off’’ imbalance at 3:40 p.m. A broker may orders after 3:50 p.m. will not be transaction is to be reported as stopped

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00106 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66902 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

stock in accordance with Exchange Rule consolidate current Exchange such as Exchange-Traded Funds, Trust 109, Commentary .02. procedures relating to MOC and LOC Issued Receipts, structured products, (v) See Rule 156(c), which sets forth orders, other than orders in Nasdaq warrants and convertible securities. the responsibilities of a broker accepting securities traded pursuant to unlisted These procedures, however, would be MOC and LOC orders. trading privileges, in new Rule 131A, applicable to closed-end funds. The Exchange proposes to implement Specialist’s Reports of MOC and LOC which would include procedures a MOC Imbalance Calculation Policy, Orders previously approved by the Commission as well as the proposed procedures set and to adopt changes to the MOC (vi) A Nasdaq UTP specialist is forth herein. In addition, the Exchange Imbalance Publication Policy similar to required to notify an Amex Floor proposes to adopt Rule 118(m) to those approved for the New York Stock Supervisor between 4:00 p.m. and 4:15 establish MOC and LOC procedures for Exchange (‘‘NYSE’’) in Release No. 34– p.m. whenever the specialist (1) reports Nasdaq securities, which procedures 40094,9 and stated in NYSE Rule a trade at or after 4:00 p.m. that does would be substantially similar to those 123C(5). The most salient feature of not involve the execution of an MOC or in proposed Rule 131A.7 these revised policies is the additional LOC order, or (2), after reporting an imbalance dissemination at 3:50 p.m. MOC or LOC transaction(s) at or after Proposed Rule 131A (Market on Close The Exchange believes additional 4:00 p.m., reports a trade after 4:00 p.m. Policy and Expiration Procedures) dissemination at 3:50 p.m. would (e.g., report of a ‘‘sold’’ sale) that is not, In an attempt to minimize price provide useful information to market of course, a transaction involving the volatility on the close, Amex procedures participants, who would be able to execution of MOC or LOC orders. This currently provide that all MOC and LOC determine to enter offsetting buy or sell notification will be on an Exchange- orders in stocks should be entered as interest based on the latest imbalance approved form, with a duplicate copy early in the day as possible to provide information. Amex believes that this for the specialist’s records. market participants an opportunity to would enhance the value of imbalance * * * * * better ascertain possible order publications in tempering market imbalances that might exist at the close. volatility at or near the close. In II. Self-Regulatory Organization’s Under these procedures, Amex addition, the Exchange believes that Statement of the Purpose of, and represents that, at 3:40 p.m. (Eastern implementing MOC/LOC procedures Statutory Basis for, the Proposed Rule Time) or as close to this time as Change that are more similar to NYSE possible, MOC order imbalances of procedures in this area would enhance In its filing with the Commission, the 25,000 shares or more must be their utility for member organizations. Amex included statements concerning published on the tape. In addition, an The Exchange proposes to require a the purpose of and basis for the order imbalance below 25,000 shares 3:50 p.m. MOC imbalance calculation in proposed rule change, as amended, and may also be published by a specialist, addition to the current 3:40 p.m. discussed any comments it received on with the concurrence of a Floor Official, calculation. For the 3:40 p.m. the proposed rule change. The text of if the specialist (i) anticipates that the calculation, marketable buy LOCs (that these statements may be examined at execution of the MOC orders on the is, LOCs with limit prices above the the places specified in Item IV below. book will result in a closing price which Exchange last sale at 3:40 p.m.) would The Amex has prepared summaries, set exceeds the price change parameters of be added to buy MOCs. Marketable sell forth in Sections A, B, and C below, of Rule 154, Commentary .08 (the $2, $1, LOCs (LOCs with limit prices below the the most significant aspects of such $.50 rule),8 or (ii) believes that an order Exchange last sale at 3:40 p.m.) would statements. imbalance should otherwise be be added to sell MOCs. The buys would A. Self-Regulatory Organization’s published in an attempt to minimize then be matched against the sells. If Statement of the Purpose of, and price volatility on the close. After 3:40 there were to be a buy imbalance, it Statutory Basis for, the Proposed Rule p.m., no MOC or LOC orders in stocks would be offset and reduced by any Change may be entered except to offset a tick-sensitive sell MOCs and tick- published MOC imbalance. sensitive, marketable sell LOCs 1. Purpose New Rule 131A would incorporate (including orders to sell short). If there The Commission has previously existing Amex MOC/LOC procedures for were to be a sell imbalance, it would be approved rules and procedures stocks during the regular trading session offset and reduced by any tick-sensitive governing market on close (‘‘MOC’’) and as well as proposed new procedures, as buy MOCs and tick-sensitive, limit on close (‘‘LOC’’) orders entered described herein. These procedures marketable buy LOCs. A ‘‘no on the Exchange.6 The Exchange would not be applicable to options or imbalance’’ notice would only be proposes to amend these rules and any security the pricing of which is published for any stock at 3:40 p.m. if procedures as described below. The based on another security or an index, there had been a prior informational amended rules and procedures set forth imbalance publication. Between 3 p.m. in this proposal would supersede the 7 The Commission approved certain procedures and 3:40 p.m., MOC/LOC imbalances of for ‘‘at the close’’ orders in Nasdaq securities in procedures previously approved by the Securities Exchange Act Release 47658 (, any size would be permitted to be Commission as described in the releases 2003), 68 FR 19041 (, 2003) (SR–Amex– published with Floor Official approval. cited above, with the exception of Rule 2003–18). The procedures and rules proposed These publications would be 109 which would continue to apply. herein are in addition to, and do not supersede, informational only and would not limit those approved in Release No. 34–47658. Auxiliary Further, the Exchange proposes to opening procedures for Nasdaq securities were filed MOC/LOC order entry before 3:40 p.m. and became effective in Securities Exchange Act Amex represents that these proposed 6 See, e.g., Securities Exchange Act Release Nos. Release No. 48000 (, 2003), 68 FR 35469 (June changes are similar to procedures 41877 (September 14, 1999), 64 FR 51566 13, 2003) (SR–Amex–2003–55). currently in place at the NYSE and (September 23, 1999) (SR–Amex–99–32); 40123 8 Amex Rule 154, Commentary .08 provides that (June 24, 1998), 63 FR 36280) (, 1998) (SR– no transaction in a stock at a price of $20 or more, included in NYSE Rule 123C except as Amex–98–10); 35660 (May 2, 1995), 60 FR 22592 $10 or more (but less than $20) or less than $10 per (May 8, 1995) (SR–Amex–95–09); 29312 (June 14, share may be at $2, $1, or $.50 or more, 9 See Securities Exchange Act Release No. 40094 1991), 56 FR 28583 (, 1991) (SR–Amex–95– respectively, away from the last previous sale, (, 1998), 63 FR 33975 (, 1998) (SR– 09). without the prior approval of a Floor Official. NYSE–97–36).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00107 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66903

follows. In view of the generally lower imposed by the NYSE under NYSE Rule sell short, for securities subject to the trading volume and different trading 123C. After 3:40 p.m., no MOC or LOC ‘‘tick test’’ in Exchange Rule 7), MOC characteristics of Amex stocks order in a stock would be permitted to orders (not including sell short ‘‘G’’); (3) compared to NYSE issues, the Exchange be taken from the book to be represented tick-sensitive, marketable market orders believes it would be appropriate to by a broker in the crowd. Amex states and marketable limit orders; (4) continue to require dissemination of that these restrictions are intended to marketable LOC orders (including ‘‘G’’); imbalances of 25,000 shares or more apply procedures for crowd orders (5) tick-sensitive, marketable LOC rather than 50,000 shares or more, as is consistent with MOC/LOC procedures orders (not including sell short ‘‘G’’); (6) required by NYSE Rule 123C. generally. Policy regarding cancellation limit orders on the specialist’s book and At 3:50 p.m., or as close to this time or reduction in size of MOC and/or LOC in the crowd limited to the closing as possible, any MOC order imbalances orders after 3:40 p.m. would remain the price; (7) LOC orders limited to the of 25,000 shares or more would be same (i.e., between 3:40 p.m. and 3:50 closing price; (8) tick-sensitive MOC required by the Exchange to be p.m., MOC and LOC orders would be orders limited to the closing price; (9) published on the consolidated tape irrevocable, except to correct an error) tick-sensitive LOC orders limited to the (Tape B). In addition, as with current except cancellation or reduction in size closing price; (10) all other ‘‘G’’ orders 3:40 p.m. imbalance procedures, an of MOC and/or LOC orders after 3:50 on the specialist’s book and in the order imbalance below 25,000 shares p.m. would not be permitted for any crowd. Amex represents that the would also be permitted to be published reason, including in case of legitimate requirement for sell short ‘‘G’’ orders to by a specialist, with the concurrence of error. Amex represents that this yield is the same as that imposed by the a Floor Official, if the specialist (i) restriction is the same as that imposed NYSE under NYSE Rule 123C. anticipates that the execution of the by the NYSE under NYSE Rule 123C. The first five categories above would MOC orders on the book would result in Proposed Rule 131A(a)(3) would be treated like MOC orders. a closing price which exceeds the price require that the specialist publish an Accordingly, the buy side would be change parameters of Rule 154, MOC order imbalance of 25,000 shares matched against the sell side to Commentary .08 (the $2, $1, $.50 or more, if practicable, if a stock reopens determine the imbalance. That rule),10 or (ii) believes that an order after 3:50 p.m. following any type of imbalance would be executed against imbalance should otherwise be trading halt. Paragraphs (a)(4) and (a)(5) the prevailing bid or offer, as published in an attempt to minimize propose procedures applicable to entry appropriate. (An imbalance of buy price volatility on the close. If there was or cancellation of MOC/LOC orders orders would be executed against the an imbalance publication at 3:40 p.m. during a regulatory halt in effect at or offer. An imbalance of sell orders would and the imbalance at 3:50 p.m. were to after 3:40 p.m. Amex represents that this be executed against the bid.) The order be less than 25,000 shares, either a ‘‘no rule text reflects procedures filed and of execution of the orders limited to that imbalance’’ notice would be published, made effective in Release No. 34– bid or offer (i.e., the orders that the or the size and side of the imbalance 41877.11 Amex states that this proposed imbalance would trade against) would would be permitted to be published rule change would supersede that filing be as set forth in numbers 6 through 10. with Floor Official approval. The 3:50 and approval. The specialist then would stop the p.m. calculation policy would be the Procedures regarding printing the remaining buy and sell ‘‘MOC’’ orders same as that applicable to the 3:40 p.m. close would be amended to provide that (i.e., those not part of the imbalance) calculation, except the Exchange last stop orders and percentage orders against each other and pair them off at sale at 3:50 p.m. would be used to elected by the execution of the MOC the price of the imbalance trade. The determine whether or not a LOC order imbalance should be included in the ‘‘pair off’’ transaction would be reported is marketable. close. Amex represents that this as ‘‘stopped stock’’ so that those who The Exchange proposes that after 3:50 requirement is the same as that imposed entered orders limited to the closing p.m., no MOC or LOC orders in stocks by the NYSE under NYSE Rule 123C. price which were not executed would would be permitted to be entered except In the interest of providing for an know that they were not entitled to to offset a published MOC imbalance in orderly and consistent execution of participate on the ‘‘stopped stock’’ effect after 3:50 p.m. Amex represents various MOC and LOC order types at the trade. Amex represents that the that this is comparable to current close, proposed Rule 131A(c), would execution of the imbalance against the procedures, whereby, after 3:40 p.m., no specify that on the close orders would prevailing bid or offer followed by the MOC or LOC orders in stocks may be be executed in the following order: (1) printing of the ‘‘paired off’’ quantity as entered except to offset a published MOC orders (including ‘‘G’’);12 (2) tick- ‘‘stopped stock’’ is the Exchange’s MOC imbalance in effect after 3:40 p.m. sensitive (e.g., buy minus, sell plus, and current procedure for executing and Amex states that this restriction is printing on-close orders as described in intended to alleviate increased pricing 11 See Release No. 34–41877, supra note 6. Amex Rule 109(d). pressure that may occur following an 12 ‘‘G’’ orders are entered for an account of either Rules 131(e) and 156(c) imbalance dissemination of buy or sell a member or member organization, or an associated interest. Amex represents that this person of a member or member organization, or for Rule 131(e), which defines ‘‘at the an account over which a member or member close order,’’ would be amended to restriction is also the same as that organization or associated person exercises imposed by the NYSE under NYSE Rule investment discretion. Section 11(a) of the Act specify that a MOC order is to be 123C. prohibits all orders for these accounts from being executed in its entirety at the Amex A broker would be permitted to executed on the floor without an exemption. 15 closing price or cancelled. Rule 131(e) U.S.C. 78k(a). The exemptions are contained in would also be amended to specify that represent an MOC or LOC order in the subparagraphs (1)(A) through (1)(I) of Section 11(a) trading crowd of a stock, but would be of the Act. 15 U.S.C. 78k(a)(1)(A)—78k(a)(1)(I). The a limit at the close (LOC) order—an required to state irrevocable MOC exemption in ‘‘G’’ requires that the member or order to buy or sell a stated amount of interest by 3:40 p.m. Amex represents member organization be primarily engaged in a security at the Amex closing price if underwriting and/or brokerage (as opposed to at the limit price or better ‘‘would have that this requirement is the same as that effecting proprietary trades on the Floor) and that the ‘‘exempt’’ transaction yield priority, parity, and to be cancelled if not executed in whole 10 See supra note 8 for a discussion of Amex Rule precedence to orders for those who are not members or in part. Amex represents that these 154. or associated with members. amendments are similar to NYSE Rule

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00108 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66904 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

123C procedures, and believes that they Expiration Friday auxiliary opening required by NYSE Rule 123C. In set forth more specifically members’ procedures contained in NYSE Rule addition, Amex systems accept market responsibilities in executing or 123C(6). Amex represents that for each orders of 99,900 shares or less rather canceling MOC/LOC orders. expiration day on which derivative, than orders of 500,000 shares or less Rule 156(c), which relates to broker index—related products expire against accepted by the NYSE. representation of an ‘‘at the close opening prices, several auxiliary order,’’ currently provides that a broker procedures are necessary to integrate MOC/LOC Procedures for Nasdaq UTP is not responsible for executing at the stock orders relating to expiring Trading closing price an ‘‘at the close order’’ that contracts into Amex’s opening In Release No. 34–47658,14 the the broker accepts. The Exchange procedures in a manner that assures an Commission approved rules relating to believes that it is appropriate for the efficient market opening in each stock execution of MOC and LOC orders in broker to be responsible for execution at as close to 9:30 a.m. as possible. The Nasdaq securities traded on the Amex the Amex closing price of a MOC order index products include, but are not pursuant to unlisted trading privileges. he or she accepts, and amended Rule limited to the following: S&P 500 Index These procedures, with certain 156(c) would so state. Rule 156(c) options and futures, Nasdaq 100 Index exceptions described in Release No. 34– would further specify that a broker options, S&P MidCap 400 Index options 47658,15 continue to apply previously handling a LOC would have to use due and futures, Russell 1000 Index options approved rules and procedures diligence to execute the order at the and futures and Russell 2000 Index Amex closing price if at the limit price governing MOC and LOC orders entered options and futures. 16 or better, and to cancel the portion of Amex represents that stock orders on the Exchange. The procedures the order that cannot be so executed. relating to index contracts whose include publication of order imbalances Aside from the customer ordering the settlement pricing is based upon beginning at 3:40 p.m. (or as close to cancellation of an MOC or LOC order opening prices would have to be this time as possible) in Nasdaq before 3:40 p.m. or for a legitimate error received by the Amex Order File (AOF) securities of 25,000 shares or more, and between 3:40 and 3:50 p.m., it should be or by the specialist by 9:00 a.m. These a prohibition on entry of MOC and LOC noted with respect to both MOC and orders would be permitted to be orders after 3:40 p.m. except to offset an LOC orders that are to be cancelled if cancelled or reduced in size. (Firms at the close order imbalance. After 3:40 not executed in whole or in part, that canceling these orders or reducing them p.m., MOC and LOC orders are such cancellations would occur only in in size would be required to prepare irrevocable except to correct an error. the following circumstances and not at contemporaneously a written record The Exchange is proposing to the discretion of either the specialist or describing the rationale for the change incorporate into new Rule 118(m) floor broker. Cancellation of MOC and and would be required to preserve it as current procedures relating to the 3:40 LOC orders would occur when (1) Rule 153 provides.) All other orders p.m. calculation and dissemination of trading has been halted in the security would be permitted to be entered before order imbalances and entry of MOC and and does not reopen prior to the close or after 9 a.m. LOC orders in Nasdaq securities. The of the market; (2) tick sensitive orders, To facilitate early order entry, AOF Exchange also proposes to modify as described above, whose execution would begin accepting orders at 7:30 current MOC and LOC procedures by will violate customer instructions (i.e., a.m. and would accept market orders of adding an additional publication of to buy only on a minus or zero minus 99,900 shares or less. ‘‘Limit-at-the- MOC/LOC order imbalances of 25,000 tick or to sell only on a plus or zero plus opening’’ (‘‘limit OPG’’) orders would be shares or more at 3:50 p.m. These tick) or Amex Rule 7; (3) for LOC orders, permitted, including delivery through modifications would also be included in the Amex closing price is not at the Exchange systems. Ordinary limit and Rule 118(m). Once again, Amex limit price or better, or (4) for tick market orders also would be permitted represents that the amended rule and sensitive MOC/LOC orders and LOC to be entered. Stock orders relating to procedures would supersede the rules orders all of which are limited to the expiring derivatives whose settlement and procedures previously approved by closing price, the limited quantity of pricing is based on opening prices the Commission as described in the shares to be traded and the rules of would be required to be identified releases referenced above with the priority as to which orders would trade ‘‘OPG.’’ As soon as practicable after 9:00 a.m. first left these orders unexecuted in 14 See Release No. 34–47658, supra note 7. whole or in part. on expiration days, the Exchange would 15 In Release No. 34–47658, the Commission publish market order imbalances of approved amendments to Amex Rule 109 (Stopping Auxiliary Opening Procedures 25,000 shares or more in all listed Stock), Amex Rule 118 (Trading in Nasdaq National The Exchange proposes to adopt Rule stocks. In addition, imbalances of less Market Securities), Amex Rule 131 (Types of than 25,000 shares would be permitted Orders) and Amex Rule 156 (Representation of 131A(d) implementing the following Orders), relating to ‘‘at the close’’ orders (1) to auxiliary opening procedures for index to be published at that time with Floor specify that these rules apply to Amex trading in options/futures expiration settlement Official approval. A ‘‘no imbalance’’ Nasdaq securities; (2) to provide for dissemination value days.13 Amex represents that status would not be published for any of order imbalance information to major news stock. Amex represents that these vendors by means of a structured communication these procedures are similar to NYSE process; and (3) to temporarily exempt from Amex proposed changes are similar to Rule 109(d) information relating to ‘‘pair off’’ 13 The term ‘‘expiration settlement value day’’ procedures currently in place at the transactions under such rule, pending refers to the days on which certain expiring index NYSE and included in NYSE Rule 123C implementation of systems changes by the Nasdaq options and/or futures (see list below for examples) except as follows. In view of the Unlisted Trading Privileges Plan Processor to have settlement values determined. These index accommodate printing of such transactions as options and futures have settlement values based on generally lower trading volume and ‘‘stopped stock.’’ It should be noted, however, with the opening prices of their component securities on different trading characteristics of Amex respect to point number (3), that, effective the trading day preceding their expiration. Index stocks compared to NYSE issues, the September 15, 2003, the Nasdaq UTP Plan options and futures expire on the Saturday Exchange believes it is appropriate to Processor was able to accommodate printing of pair- following the third Friday of each expiration off transactions as ‘‘stopped stock.’’ Thus, effective month. The expiration settlement value day is the continue to require dissemination of October 8, 2003, the temporary exemption from last trading day preceding expiration, which is imbalances of 25,000 shares or more Amex Rule 109(d) was eliminated. normally a Friday. rather than 50,000 shares or more, as is 16 See supra, note 6.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00109 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66905

exception of Release No. 34–47658,17 permitted for any reason, including in close of the market; (2) for LOC orders, and Release No. 34–48000.18 case of legitimate error. the Amex closing price is not at the The Exchange believes an additional The Exchange proposes to prohibit limit price or better, or (3) for LOC publication is necessary at 3:50 p.m. in entry of tick-sensitive MOC or LOC orders which are limited to the closing light of the price volatility in Nasdaq orders (e.g., buy ‘‘minus’’ or sell ‘‘plus’’) price, the limited quantity of shares to stocks, particularly near the close of in Nasdaq stocks. (Sell short orders in be traded and the rules of priority as to trading. An additional imbalance Nasdaq securities, which are exempt which orders would trade first left these publication at 3:50 p.m. would reflect from ‘‘tick’’ restrictions on the Amex, orders unexecuted in whole or in part. any offsetting interest as well as any would be accepted.) Such orders, (e.g., Proposed Rule 118(m)(ii)(c) provides legitimate cancellations entered after the buy ‘‘minus’’ or sell ‘‘plus’’) which for identical MOC/LOC procedures to 3:40 p.m. publication and would reflect account for less than one percent of ‘‘at those in Rule 131A(a)(3) in the context any shift in the imbalance from a buy the close’’ orders entered in Nasdaq of trading halts, discussed above. Rule to sell imbalance or vice versa. The 3:50 stocks, may impede the specialist in 118(m)(iii), which references procedures p.m. publication would provide providing an orderly and timely close, in Rule 109(d) applicable to printing the additional, more timely market in so far as they are processed manually, close, would provide that stop orders information to market participants, which makes such orders more difficult and percentage orders elected by the which Amex states is intended to to process in a timely manner. execution of the MOC imbalance should encourage possible buy or sell interest An order imbalance at 3:40 p.m. or be included in the close. offsetting the imbalance after 3:50 p.m., 3:50 p.m. below 25,000 shares also Procedures set forth in proposed Rule thereby promoting greater pricing would be permitted to be published by 118(m)(iv) (Order of Execution of MOC stability at the close. a specialist, with the concurrence of a and LOC Orders) would be the same as Floor Official, if the specialist (i) those set forth in proposed Rule Proposed Rule 118(m) provides that at anticipates that the execution of the 131A(c), except that tick-sensitive 3:40 p.m. and at 3:50 p.m., or as close MOC orders on the book would result in orders would not be referenced in so far to these times as possible, MOC order a closing price which exceeds the price as entry of such orders would be imbalances of 25,000 shares or more change parameters of Rule 154, prohibited for Nasdaq UTP securities. would be published in a manner Commentary .08 (the $2, $1, $.50 Rule), Procedures for Reporting the Amex specified by the Exchange. That is, the or (ii) believes that an order imbalance Official Closing Price and ‘‘M’’ Modifier Exchange would utilize a structured should otherwise be published in an communication process established attempt to minimize price volatility on The Amex has received Commission with major news vendors (e.g., the close. For 3:40 p.m. imbalance approval for use of the ‘‘M’’ sale Bloomberg and Dow Jones), utilizing, disseminations, a ‘‘No Imbalance’’ condition modifier on the UTP Trade among other things, e-mail and file notice would only be published at 3:40 Data Feed (‘‘UTDF’’) to identify the transfer protocol technology to permit p.m. if there had been a prior Amex’s Official Closing Price (‘‘AOCP’’) public dissemination of order imbalance informational imbalance publication in a Nasdaq security.20 Amex represents information at 3:50 p.m., or as soon between 3:00 p.m. and 3:40 p.m. For that, as described in File No. SR–Amex– 19 thereafter as practicable. 3:50 p.m. imbalance disseminations, if 2003–18, at the close orders are subject The imbalance calculation policy for there was an imbalance publication at to ‘‘pair off’’ procedures in Amex Rule the 3:40 p.m. calculation would be as 3:40 p.m. and the imbalance at 3:50 p.m. 109(d)(1), which requires a member follows: marketable LOC orders to buy were to be less than 25,000 shares, holding both buy and sell MOC orders (that is, LOC buy orders with limit either a ‘‘No Imbalance’’ notice will be to pair them off against each other and prices above the consolidated last sale at published, or the size and side of the execute any imbalance against the 3:40 p.m.) would be added to MOC imbalance may be published with Floor prevailing Amex bid or offer at the orders to buy. Marketable LOC orders to Official approval. close. Any imbalance at the close is sell (that is, LOC sell orders including Rule 118(m)(i), like Rule 131(e) as it executed at the current bid or offer, or those to sell short, with limit prices is proposed to be amended, provides as close as practicable to 4:00 p.m., and below the consolidated last sale at 3:40 that a MOC order must be executed in remaining buy and sell orders are p.m.) would be added to MOC orders to its entirety at the Exchange closing price stopped against each other and paired sell. The buy orders are then matched or is to be cancelled. Rule 118(m)(v) off at that same bid or offer price. Amex against sell orders to calculate the would reference Rule 156(c) as it is reports the first trade (execution of the imbalance and side. Procedures for the proposed to be amended, and would imbalance) and second pair off trade 3:50 p.m. imbalance calculation would make the broker representing a MOC separately at the same price, and then be the same as those for the 3:40 p.m. order in the Trading Crowd responsible sends a third report with only the price calculation, except that the consolidated for an execution at the Exchange’s of those transactions with an ‘‘M’’ last sale at 3:50 p.m. would be used to closing price. Aside from the customer identifier via UTDF as the Official determine whether or not a LOC order ordering the cancellation of an MOC or Closing Price for the stock on the Amex. is marketable. After 3:50 p.m., no MOC LOC order before 3:40 p.m. or for a The Exchange would disseminate an or LOC orders would be permitted to be legitimate error between 3:40 and 3:50 AOCP for a security only when the entered except to offset the latest p.m., it should be noted with respect to closing price for that security on the published MOC imbalance. Between both MOC and LOC orders that are to be Amex has been determined as the result 3:40 p.m. and 3:50 p.m., MOC and LOC cancelled if not executed in whole or in of the execution of MOC or LOC orders orders would be irrevocable, except to part, that such cancellations would entered on the Exchange. If no MOC/ correct an error. Cancellation or occur only in the following LOC orders were to be executed, Amex reduction in size of MOC and/or LOC circumstances and not at the discretion would not disseminate an AOCP using orders after 3:50 p.m. would not be of either the specialist or floor broker. the ‘‘M’’ modifier. The Exchange Cancellation of MOC and LOC orders believes this is necessary in establishing 17 See supra note 7. would occur when (1) trading has been an ‘‘official’’ close because MOC and 18 Id. halted in the Nasdaq UTP stock on the 19 Id. Amex and does not reopen prior to the 20 Id.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00110 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66906 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

LOC orders are the only order types that trade, to foster cooperation and available for inspection and copying at must be executed at the Exchange coordination with persons engaged in the principal office of the Amex. All closing price or not at all. Amex regulating, clearing, settling, processing submissions should refer to File No. believes that restricting the use of the information with respect to, and SR–Amex–2003–21 and should be ‘‘M’’ modifier to executions of MOC and facilitating transactions in securities, to submitted by December 19, 2003. LOC orders would ensure that the remove impediments to and perfect the For the Commission, by the Division of closing price in the Exchange auction mechanism of a free and open market Market Regulation, pursuant to delegated market accurately reflects buy and sell and a national market system and, in authority.23 interest at the close. general, to protect investors and the Margaret H. McFarland, In connection with dissemination of public interest. Deputy Secretary. the ‘‘M’’ modifier, between 4:15 p.m. [FR Doc. 03–29659 Filed 11–26–03; 8:45 am] and 4:25 p.m. each trading day, an B. Self-Regulatory Organization’s Exchange Floor Supervisor would Statement on Burden on Competition BILLING CODE 8010–01–P review each Nasdaq transaction The Exchange does not believe that appearing on the tape at or after 4:00 the proposed rule change, as amended, SECURITIES AND EXCHANGE p.m. to determine if that trade involved will impose any burden on competition. COMMISSION the execution of MOC/LOC orders. As the Exchange’s systems are programmed C. Self-Regulatory Organization’s [Release No. 34–48814; File No. SR–Amex– to capture as ‘‘M’’ all Nasdaq Statement on Comments on the 2003–96] transactions which appeared on the tape Proposed Rule Change Received From Self-Regulatory Organizations; Notice at or after 4:00 p.m. the Exchange Floor Members, Participants or Others of Filing and Immediate Effectiveness Supervisor would correct the list by No written comments were solicited of Proposed Rule Change by the removing all such trades not involving or received with respect to the proposed American Stock Exchange LLC To the execution of MOC/LOC orders to rule change, as amended. ensure that an ‘‘M’’ is disseminated only Revise Its Registration Fees III. Date of Effectiveness of the when the Amex closing price is the Proposed Rule Change and Timing for November 20, 2003. result of execution of MOC or LOC Commission Action Pursuant to Section 19(b)(1) of the orders. By 4:25 p.m., Amex would Securities Exchange Act of 1934 finalize and complete dissemination of Within 35 days of the date of (‘‘Act’’),1 and Rule 19b–4 thereunder,2 AOCP prices with the ‘‘M’’ modifier to publication of this notice in the Federal notice is hereby given that on November the Nasdaq UTP Processor. At 4:30 p.m., Register or within such longer period (i) 13, 2003, the American Stock Exchange the Processor would disseminate a as the Commission may designate up to LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with closing trade recap message with the 90 days of such date if it finds such the Securities and Exchange final AOCP prices. The 4:30 p.m. longer period to be appropriate and Commission (‘‘Commission’’) the dissemination would be implemented as publishes its reasons for so finding or proposed rule change as described in part of an enhancement to the Processor (ii) as to which the self-regulatory Items I, II and III below, which Items implemented on September 15, 2003. organization consents, the Commission have been prepared by the Exchange. In order to ensure that transactions will: The Exchange has designated this A. by order approve such proposed reported by specialists at or after 4:00 proposal as one establishing or changing rule change, as amended, or p.m. that are not the result of executions a due, fee or other charge imposed by B. institute proceedings to determine of MOC or LOC orders are not reported the self-regulatory organization under whether the proposed rule change, as as the AOCP with the ‘‘M’’ modifier, the Section 19(b)(3)(A) of the Act 3 and Rule amended, should be disapproved. Exchange would require Nasdaq UTP 19b–4(f)(2) thereunder,4 which renders specialists to notify an Amex Floor IV. Solicitation of Comments the proposed rule change effective upon Supervisor between 4:00 p.m. and 4:15 Interested persons are invited to filing with the Commission. The p.m. whenever the specialist (1) reports Commission is publishing this notice to a trade at or after 4:00 p.m. that does not submit written data, views, and arguments concerning the foregoing, solicit comments on the proposed rule involve the execution of MOC/LOC change from interested persons. orders, or (2), after reporting an MOC/ including whether the proposed rule LOC transaction(s) at or after 4:00 p.m., change, as amended, is consistent with I. Self-Regulatory Organization’s reports a trade after 4:00 p.m. (e.g., the Act. Persons making written Statement of the Terms of Substance of report of a ‘‘sold’’ sale) that is, of course, submissions should file six copies the Proposed Rule Change thereof with the Secretary, Securities not a transaction involving the The American Stock Exchange LLC and Exchange Commission, 450 Fifth execution of MOC or LOC orders. This proposes to revise its registration fees. Street, NW., Washington, DC 20549– notification would be on an Exchange- The text of the proposed rule change is 0609. Copies of the submission, all approved form, with a duplicate copy set forth below. Proposed new language subsequent amendments, all written for the specialist’s records. is in italics; proposed deletions are in statements with respect to the proposed [brackets]. 2. Statutory Basis rule change that are filed with the * * * * * The Amex believes that the proposed Commission, and all written Floor Fees and Booth Rental Fees. No rule change is consistent with Section communications relating to the change. 21 proposed rule change between the 6(b) of the Act, in general, and Section Member Fees. No change. 22 Commission and any person, other than 6(b)(5), in particular in that it is Registration and IDC Fees designed to prevent fraudulent and those that may be withheld from the manipulative acts and practices, to public in accordance with the 23 17 CFR 200.30–3(a)(12). promote just and equitable principles of provisions of 5 U.S.C. 552, will be 1 15 U.S.C. 78s(b)(1). available for inspection and copying in 2 17 CFR 240.19b–4. 21 15 U.S.C. 78f(b). the Commission’s Public Reference 3 15 U.S.C. 78s(b)(3)(A). 22 15 U.S.C. 78f(b)(5). Room. Copies of such filing will also be 4 17 CFR 240.19b–4(f)(2).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00111 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66907

I. Registration II. Self-Regulatory Organization’s B. Self-Regulatory Organization’s Initial Processing Fee (1)—$145 Statement of the Purpose of, and Statement on Burden on Competition Statutory Basis for, the Proposed Rule Disclosure Processing Fee (2)—95 The Exchange believes that the Change proposed fee change will impose no Annual Renewal Processing Fee (3)— In its filing with the Commission, the burden on competition that is not 80 [77] necessary or appropriate in furtherance (4) Exchange included statements Fingerprint Card Processing Fee — concerning the purpose of and basis for of the purposes of the Act. 35 the proposed rule change and discussed C. Self-Regulatory Organization’s Fingerprint Results Processed thru any comments it received on the Statement on Comments on the other (5)—13 proposed rule change. The text of these Proposed Rule Change Received From Transfer Processing Fee (6)—125 statements may be examined at the Members, Participants or Others places specified in Item IV below. The Web CRD System Transition Fee (7)— No written comments were solicited Exchange has prepared summaries, set 85 (one time) or received with respect to the proposed forth in Sections A, B, and C below, of rule change. Terminations Fee (8)—35 [30] (one the most significant aspects of such time) statements. III. Date of Effectiveness of the II. Options IDC No change Proposed Rule Change and Timing for A. Self-Regulatory Organization’s Commission Action Notes Statement of the Purpose of, and The proposed rule change has become (1) The Initial Processing Fee will be Statutory Basis for, the Proposed Rule immediately effective pursuant to assessed for all initial and dual registration Change 7 Form U–4 filings. $85.00 of this fee will be Section 19(b)(3)(A)(ii) of the Act, and retained by NASD as its CRD Processing Fee 1. Purpose subparagraph (f)(2) of Rule 19b–4 8 and $60.00 will be disbursed by NASD to thereunder, in that it establishes or Amex as its Initial Registration Fee. The Exchange requires persons who changes a due, fee, or other charge (2) The Disclosure Processing Fee will be perform specified functions for imposed by the self-regulatory assessed in connection with Forms U–4 and members and member organizations to organization. At any time within 60 U–5 for all filings that contain new or be registered with the Exchange. The days of the filing of such proposed rule amended disclosure information. The $95.00 Exchange also requires members and change, the Commission may summarily fee will be retained by NASD as its member organizations to report abrogate the rule change if it appears to Disclosure Processing Fee. terminations of registered persons. All the Commission that such action is (3) The Annual System Processing Fee will registration filings currently are made necessary or appropriate in the public be assessed during the yearly renewal cycle. through the NASD’s Central Registration interest, for the protection of investors, $30.00 of this fee will be retained by NASD Depository system. As a result, Amex or otherwise in furtherance of the as its Annual System Processing Fee assessed registration fees typically reflect a during renewals and $50.00 [$47.00] will be purposes of the Act. combination of Amex and NASD disbursed by NASD to Amex as its Annual IV. Solicitation of Comments Maintenance Fee. charges. The Amex and other self- (4) The Fingerprint Processing Fee will be regulatory organizations use the Interested persons are invited to assessed for receiving hard copy fingerprint registration process (1) to ensure that submit written data, views, and cards as part of the registration function and qualified persons are employed in the arguments concerning the foregoing, submitting and processing the results of each securities industry, and (2) to identify including whether the proposed rule card received. The $35.00 fee will be retained possible regulatory issues associated change is consistent with the Act. by NASD as its Fingerprint Card Processing with individuals who seek to become Persons making written submissions Fee. associated with a member or member should file six copies thereof with the (5) The Fee for Posting Fingerprint Results organization or whose registration is Secretary, Securities and Exchange Processed through Other SROs will be terminated. Commission, 450 Fifth Street, NW., assessed for processing the results of Washington, DC 20549–0609. Copies of fingerprints processed by the FBI through an The Exchange is proposing to increase the submission, all subsequent SRO other than NASD. The $13.00 fee will the Amex portion of the annual amendments, all written statements be retained by NASD. registration renewal fee and the (6) The Transfer Processing Fee will be with respect to the proposed rule Exchange’s termination fee. These change that are filed with the assessed for all transfer and re-license Form increases would amount to $3.00 for the U–4 filings. $85.00 of this fee will be retained Commission, and all written renewal fee and $5.00 for the communications relating to the by NASD as its CRD Processing Fee and termination fee. $40.00 will be disbursed by NASD to Amex proposed rule change between the as its Transfer Fee. 2. Statutory Basis Commission and any person, other than (7) The Web CRD System Transition Fee is those that may be withheld from the a one time fee that will be assessed on all The Exchange believes that the public in accordance with the individuals whose U–4s will be refiled proposed rule change is consistent with provisions of 5 U.S.C. 552, will be electronically with Web CRD as part of the Section 6(b) of the Act 5 in general and available for inspection and copying in Exchange’s migration to Web CRD. The furthers the objectives of Section $85.00 fee will be retained by NASD as its the Commission’s Public Reference 6(b)(4) 6 in particular in that it is CRD Processing Fee. Room. Copies of such filing will also be (8) The Termination Fee will be assessed in designed to provide for the equitable available for inspection and copying at connection with all Form U–5 filings. This allocation of reasonable dues, fees, and the principal office of the Exchange. All $35.00 [$30.00] fee will be disbursed by other charges among its members, submissions should refer to File No. NASD to Amex as its Terminations Fee. issuers and other persons using its SR–Amex–2003–96 and should be facilities. submitted by December 19, 2003. Amex Equity Fee Schedule through Other Fees. (No change) 5 15 U.S.C. 78f. 7 15 U.S.C. 78s(b)(3)(A)(ii). * * * * * 6 15 U.S.C. 78f(b)(4). 8 17 CFR 240.19b–4(f)(2).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00112 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66908 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

For the Commission, by the Division of may be examined at the places specified C. Self-Regulatory Organization’s Market Regulation, pursuant to delegated in Item IV below. CBOE has prepared Statement on Comments on the 9 authority. summaries, set forth in sections A, B, Proposed Rule Change Received From Margaret H. McFarland, and C below, of the most significant Members, Participants, or Others Deputy Secretary. aspects of such statements. [FR Doc. 03–29661 Filed 11–26–03; 8:45 am] No written comments were solicited or received with respect to the proposed BILLING CODE 8010–01–P A. Self-Regulatory Organization’s Statement of the Purpose of and rule change. Statutory Basis for, Proposed Rule III. Date of Effectiveness of the SECURITIES AND EXCHANGE Change Proposed Rule Change and Timing for COMMISSION 1. Purpose Commission Action [Release No. 34–48815; File No. SR–CBOE– 2003–33] Currently, the Exchange charges Within 35 days of the date of transaction fees for orders executed on publication of this notice in the Federal Self-Regulatory Organizations; Notice behalf of non-member market makers Register or within such longer period (i) of Filing of Proposed Rule Change and (i.e., those designated with an ‘‘N’’ as the Commission may designate up to Amendment No. 1 Thereto by the origin code) that are equal to member 90 days of such date if it finds such Chicago Board Options Exchange, market maker and member firm rates in longer period to be appropriate and Inc., Relating to Non-Member Market the equities and QQQ options ($.19 per publishes its reasons for so finding or Maker Transaction Fees contract) and equal to customer rates in (ii) as to which the self-regulatory organization consents, the Commission index products ($.15 to $.40). CBOE November 20, 2003. will: Pursuant to section 19(b)(1) of the represents that Exchange members have complained that such equivalence of (A) by order approve such proposed Securities Exchange Act of 1934 rule change, or (‘‘Act’’),1 and Rule 19b–4 thereunder,2 fees is unfair to Exchange members, notice is hereby given that on July 30, who pay a variety of additional fees (B) institute proceedings to determine 2003, the Chicago Board Options through their membership in the whether the proposed rule change Exchange, Inc. (‘‘CBOE’’ or ‘‘Exchange’’) Exchange to help offset the Exchange’s should be disapproved. filed with the Securities and Exchange expenses. In order to more fairly assess IV. Solicitation of Comments Commission (‘‘Commission’’) the Exchange costs among the individuals proposed rule change as described in and organizations who avail themselves Interested persons are invited to Items I, II, and III below, which Items of the Exchange’s trading opportunities, submit written data, views, and have been prepared by CBOE. On the Exchange proposes to increase arguments concerning the foregoing, November 13, 2003, CBOE filed transaction fees for N orders by $.02 per including whether the proposed rule Amendment No. 1 by facsimile.3 The contract. change is consistent with the Act. Commission is publishing this notice to In connection with the $.02 increase, Persons making written submissions should file six copies thereof with the solicit comments on the proposed rule the Exchange notes two points. First, the Secretary, Securities and Exchange change from interested persons. Exchange notes that since it does not Commission, 450 Fifth Street, NW., permit non-members to enter orders on I. Self-Regulatory Organization’s Washington, DC 20549–0609. Copies of Statement of the Terms of Substance of the Exchange, the Exchange will not be the submission, all subsequent the Proposed Rule Change directly assessing any such fees upon amendments, all written statements CBOE proposes to change its Fee non-members. Second, the Exchange with respect to the proposed rule Schedule to increase transaction fees for notes that the $.02 increase will not change that are filed with the orders originating from non-member apply to linkage orders. Commission, and all written market makers by $.02 per contract. The 2. Statutory Basis communications relating to the text of the proposed rule change is proposed rule change between the available at the Office of the Secretary, The Exchange believes that the Commission and any person, other than CBOE and at the Commission. proposed rule change is consistent with those that may be withheld from the section 6(b) of the Act 4 in general, and public in accordance with the II. Self-Regulatory Organization’s furthers the objectives of Section 6(b)(4) provisions of 5 U.S.C. 552, will be Statement of the Purpose of, and of the Act 5 in particular, in that it is available for inspection and copying in Statutory Basis for, the Proposed Rule the Commission’s Public Reference Change designed to provide for the equitable allocation of reasonable dues, fees, and Section. Copies of such filing will also In its filing with the Commission, other charges among Exchange members be available for inspection and copying CBOE included statements concerning and issuers and other persons using its at the principal office of CBOE. All the purpose of, and basis for, the facilities. submissions should refer to File No. proposed rule change and discussed any SR–CBOE–2003–33 and should be comments it received on the proposed B. Self-Regulatory Organization’s submitted by December 19, 2003. Statement on Burden on Competition rule change. The text of these statements For the Commission, by the Division of The Exchange does not believe that Market Regulation, pursuant to delegated 9 17 CFR 200.30–3(a)(12). authority.6 1 the proposed rule change will impose 15 U.S.C. 78s(b)(1). Margaret H. McFarland, 2 17 CFR 240.19b–4. any burden on competition not 3 See letter from Christopher R. Hill, Assistant necessary or appropriate in furtherance Deputy Secretary. General Counsel, CBOE to Leah Mesfin, Attorney, of purposes of the Act. [FR Doc. 03–29660 Filed 11–26–03; 8:45 am] Division of Market Regulation, Commission, dated BILLING CODE 8010–01–P November 13, 2003 (‘‘Amendment No. 1’’). In Amendment No. 1, CBOE modified its argument in 4 15 U.S.C. 78f(b). support of the proposal. 5 15 U.S.C. 78f(b)(4). 6 17 CFR 200.30–3(a)(12).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00113 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66909

SECURITIES AND EXCHANGE (d) Stop Orders. A stop order is an orders are maintained in the system and COMMISSION order that becomes a market order when remain available for execution after all the stop price is elected. A stop order to [Release No. 34–48811; File No. SR–ISE– other trading interest at the same price 2003–25] buy is elected when the option is bid or has been exhausted. trades on the ISE at, or above, the Stop orders are defined as orders that specified stop price. A stop order to sell Self-Regulatory Organizations; Notice become market orders when the stop is elected when the option is offered or of Filing and Immediate Effectiveness price is elected. A stop order to buy is trades on the ISE at, or below, the of a Proposed Rule Change and elected when the option is bid or trades Amendment No. 1 Thereto by the specified stop price. on the ISE at, or above, the specified International Stock Exchange, Inc. To (e) Stop Limit Orders. A stop limit stop price. A stop order to sell is elected Amend Rules 713 and 715 To Add order is an order that becomes a limit Definitions for All-or-None Orders, order when the stop price is elected. A when the option is offered or trades on Stop Orders and Stop Limit Orders stop limit order to buy is elected when the ISE at, or below, the specified stop the option is bid or trades on the ISE at, price. When the stop price is elected, November 20, 2003. or above, the specified stop price. A stop the system releases a market order into Pursuant to section 19(b)(1) of the limit order to sell becomes a sell limit the market and the order would be Securities Exchange Act of 1934 order when the option is offered or handled in the same manner as any 1 2 (‘‘Act’’), and Rule 19b–4 thereunder, trades on the ISE at, or below, the other market order. notice is hereby given that on October specified stop price. 16, 2003, the International Stock Stop limit orders are defined as orders Exchange, Inc. (‘‘ISE’’ or ‘‘Exchange’’) Rule 713. Priority of Quotes and Orders that become limit orders when the stop price is elected. A stop limit order to filed with the Securities and Exchange * * * * * Commission (‘‘Commission’’) the buy is elected when the option is bid or proposed rule change as described in Supplementary Material to Rule 713 trades on the ISE at, or above, the Items I, II and III below, which Items * * * * * specified stop price. A stop limit order have been prepared by the ISE. The .02 All-or-none orders, as defined in to sell is elected when option is offered Exchange has filed the proposal as a Rule 715(c), are contingency orders that or trades on the ISE at, or below, the ‘‘non-controversial’’ rule change have no priority on the book. Such specified stop price. Once the stop price pursuant to section 19(b)(3)(A)(iii) of the orders are maintained in the system and is elected, the limit order is placed on Act,3 and Rule 19b–4(f)(6) thereunder,4 remain available for execution after all the ISE book and would be handled in which renders the proposal effective other trading interest at the same price the same manner as any other limit upon filing with the Commission.5 On has been exhausted. order on the ISE book. In Amendment November 13, 2003, the ISE filed * * * * * No. 1, the Exchange has represented that Amendment No. 1 to the proposed rule stop and stop limit orders will be change.6 The Commission is publishing II. Self-Regulatory Organization’s elected automatically by the system this notice to solicit comments on the Statement of the Purpose of, and without manual intervention by any proposed rule change from interested Statutory Basis for, the Proposed Rule market participant, and that no market Change persons. participant on the ISE will be able to I. Self-Regulatory Organization’s In its filing with the Commission, the view pending stop and stop limit orders Statement of the Terms of Substance of ISE included statements concerning the in the system. the Proposed Rule Change purpose of, and basis for, the proposed rule change and discussed any 2. Statutory Basis The Exchange is proposing to amend comments it received on the proposed Rules 713 and 715 to add definitions for The ISE believes that the rule change rule change. The text of these statements all-or-none orders, stop orders and stop is consistent with section 6 of the Act may be examined at the places specified limit orders. The text of the proposed in general 8 and Section 6(b)(5) of the in Item IV below. The Exchange rule change is set forth below. Proposed 9 prepared summaries, set forth in Act in particular. The Exchange new language is in italics; proposed sections A, B, and C below, of the most believes that the proposed rule change deletions are in [brackets]. significant aspects of such statements. is intended to remove impediments to * * * * * and perfect the mechanism for a free A. Self-Regulatory Organization’s and open market and a national market Rule 715. Types of Orders Statement of the Purpose of, and system, and, in general, to protect (c) All-Or-None Orders. An all-or- Statutory Basis for, the Proposed Rule investors and the public interest. The none order is a limit or market order Change Exchange also believes that new order that is to be executed in its entirety or 1. Purpose types will offer investors new trading not at all. opportunities on the Exchange and The Exchange proposes to amend enhance the Exchange’s competitive 1 15 U.S.C. 78s(b)(1). Rules 713 and 715 to add definitions for position. 2 17 CFR 240.19b–4. all-or-none orders, stop orders and stop 3 15 U.S.C. 78s(b)(3)(A). limit orders. The definitions of these B. Self-Regulatory Organization’s 4 17 CFR 240.19b–4(f)(6)(iii). three order types are consistent with the Statement on Burden on Competition 5 The ISE provided a five-day written notice to the Commission of its intent to file the proposal. definitions contained in other 7 The ISE has requested the Commission to waive the exchanges’ rules. An all-or-none order The proposed rule change does not 30-day operative delay. See Rule 19b–4(f)(6)(iii) is a limit or market order that is to be impose any burden on competition that under the Act. 17 CFR 240.19b–4(f)(6)(iii). executed in its entirety or not at all. All- is not necessary or appropriate in 6 See letter from Katherine Simmons, Vice or-none orders are contingency orders furtherance of the purposes of the Act. President and Associate General Counsel, ISE, to Theodore Lazo, Senior Special Counsel, Division of that have no priority on the book. Such 8 15 U.S.C. 78f. Market Regulation, Commission, Dated November 13, 2003 (‘‘Amendment No. 1’’). 7 See, e.g., CBOE Rule 43.2. 9 15 U.S.C. 78f(b)(5).

VerDate jul<14>2003 19:46 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00114 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66910 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

C. Self-Regulatory Organization’s Washington, DC 20549–0609. Copies of Commission.5 The Commission is Statement on Comments on the the submission, all subsequent publishing this notice to solicit Proposed Rule Change Received From amendments, all written statements comments on the proposed rule change Members, Participants or Others with respect to the proposed rule from interested persons. change that are filed with the The Exchange has not solicited, and I. Self-Regulatory Organization’s Commission, and all written does not intend to solicit, comments on Statement of the Terms of Substance of communications relating to the this proposed rule change. The the Proposed Rule Change Exchange has not received any proposed rule change between the unsolicited written comments from Commission and any person, other than Nasdaq proposes to amend NASD members or other interested parties. those that may be withheld from the Rule 6130 to further clarify the reporting public in accordance with the requirements applicable to transactions III. Date of Effectiveness of the provisions of 5 U.S.C. 552, will be conducted through electronic Proposed Rule Change and Timing for available for inspection and copying in communications networks (‘‘ECNs’’) Commission Action the Commission’s Public Reference and reported to the Automated Because the foregoing proposed rule Room. Copies of such filing will also be Confirmation Transaction Service change, as amended, does not: (i) available for inspection and copying at (‘‘ACT’’). These reporting requirements significantly affect the protection of the principal office of the ISE. were recently codified by SR–NASD– investors or the public interest; (ii) All submissions should refer to File 2003–98.6 Nasdaq is also proposing to impose any significant burden on No. SR–ISE–2003–25 and should be delay until November 10, 2003 the competition; (iii) become operative for submitted by December 19, 2003. implementation of rule changes effected 30 days from the date on which it was For the Commission, by the Division of by SR–NASD–2003–98. filed, or such shorter time as the Market Regulation, pursuant to delegated The text of the proposed rule change 13 Commission may designate if the authority. is set forth. Proposed new language is in proposal is consistent with the Margaret H. McFarland, italics; proposed deletions are in protection of investors and the public Deputy Secretary. brackets. interest; and the Exchange has given the [FR Doc. 03–29622 Filed 11–26–03; 8:45 am] * * * * * Commission written notice of its BILLING CODE 8010–01–P intention to file the proposed rule 6100. AUTOMATED CONFIRMATION change at least five business days prior TRANSACTION SERVICE (ACT) to filing, or such shorter time as SECURITIES AND EXCHANGE 6130. Trade Report Input designated by the Commission, it has COMMISSION become effective pursuant to Section (a)–(b) No change. 10 [Release No. 34–48812; File No. SR–NASD– 19(b)(3)(A) of the Act and Rule 19b– (c) Which Party Inputs Trade Reports 11 2003–160] 4(f)(6) thereunder. At any time within to ACT 60 days of the filing of the proposed rule change, the Commission may summarily Self-Regulatory Organizations; Notice ACT Participants shall, subject to the abrogate such rule change if it appears of Filing and Immediate Effectiveness input requirements below, either input to the Commission that such action is of Proposed Rule Change by National trade reports into the ACT system or necessary or appropriate in the public Association of Securities Dealers, Inc. utilize the Browse feature to accept or interest, for the protection of investors, Regarding Reporting of Transactions decline a trade within the applicable or otherwise in furtherance of the Conducted Through Electronic time-frames as specified in paragraph purposes of the Act.12 The Commission Communications Networks to the (b) of this Rule. Trade data input has decided to waive the 30 day Automated Confirmation Transaction obligations are as follows: operative delay and designates that the Service (1)–(5) No change. proposal become operative upon filing November 20, 2003. (6) in transactions conducted through with the Commission because the Pursuant to Section 19(b)(1) of the two ACT ECNs or an ACT ECN AND an proposed rule change permits the Securities Exchange Act of 1934 ECN that is not an ACT ECN, an ACT implementation of all-or-none, stop, and (‘‘Act’’),1 and Rule 19b–4 thereunder,2 ENC shall be responsible for complying stop limit orders in a manner consistent notice is hereby given that on October with the requirements of paragraph (5) with the protection of investors and the 27, 2003, the National Association of above for reporting a transaction public interest. Securities Dealers, Inc. (‘‘NASD’’), executed through its facilities, and an IV. Solicitation of Comments through its subsidiary, The Nasdaq ECN that routed an order to it for Stock Market, Inc. (‘‘Nasdaq’’), filed execution shall be deemed to be and Interested persons are invited to with the Securities and Exchange Order Entry Firm [a Market Maker] for submit written data, views and Commission (‘‘Commission’’) the purposes of the rules for determining arguments concerning the foregoing, proposed rule change as described in reporting parties reflected in paragraphs including whether the amended Items I, II and III below, which Items (1), [(2),] (3), and (4) above; and proposal is consistent with the Act. have been prepared by Nasdaq. Nasdaq Persons making written submissions (7) No change. filed the proposal pursuant to Section should file six copies thereof with the (d)–(e) No change. 19(b)(3)(A) of the Act 3 and Rule 19b– Secretary, Securities and Exchange 4(f)(6) thereunder,4 which renders the * * * * * Commission, 450 Fifth Street NW., proposal effective upon filing with the 5 Nasdaq asked the Commission to waive the 5- 10 15 U.S.C. 78s(b)(3)(A). day pre-filing notice requirement and the 30-day 13 11 17 CFR 240.19b–4(f)(6). 17 CFR 200.30–3(a)(12). operative delay. See Rule 19b–4(f)(6)(iii) and 17 1 12 For purposes of calculating the 60-day 15 U.S.C. 78s(b)(1). CFR 240.19b–4(f)(6)(iii). abrogation period, the Commission considers the 2 17 CFR 240.19b–4. 6 Securities Exchange Act Release No. 48442 period to have commenced on November 13, 2003, 3 15 U.S.C. 78s(b)(3)(A). (September 4, 2003), 68 FR 53767 (September 12, the date the ISE filed Amendment No. 1. 4 17 CFR 240.19b–4(f)(6). 2002).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00115 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66911

II. Self-Regulatory Organization’s routing ECN that is matched against the C. Self-Regulatory Organization’s Statement of the Purpose of, and order of an order entry firm or another Statement on Comments on the Statutory Basis for, the Proposed Rule ECN, the sell side has generally been Proposed Rule Change Received From Change identified as the reporting party. If the Members, Participants or Others In its filing with the Commission, executing ECN matched the routed The Exchange has neither solicited Nasdaq included statements concerning order against the order of a market nor received written comments on the the purpose of and basis for the maker, however, the market maker has proposed rule change. proposed rule change and discussed any been identified as the reporting party. The same priority rules would also III. Date of Effectiveness of the comments it received on the proposed Proposed Rule Change and Timing for rule change. The text of these statements apply when the executing ECN uses the trade reporting model in which it Commission Action may be examined at the places specified requires one of its subscribers to report in Item IV below. Nasdaq has prepared Because the foregoing proposed rule the trade. summaries, set forth in Sections A, B, change does not: (i) significantly affect The benefit sought to be gained from the protection of investors or the public and C below, of the most significant SR–NASD–2003–98 was to enhance aspects of such statements. interest; (ii) impose any significant predictability and enforceability by burden on competition; (iii) become A. Self-Regulatory Organization’s codifying existing practices. In keeping operative for 30 days from the date on Statement of the Purpose of, and with these goals, Nasdaq believes that it which it was filed, or such shorter time Statutory Basis for, the Proposed Rule is acceptable for executing ECNs to treat as the Commission may designate; and Change routing ECNs as order entry firms. Thus, the Exchange has given the Commission Nasdaq proposes to amend NASD Rule 1. Purpose written notice of its intention to file the 6130(c)(6) accordingly. proposed rule change at least five In SR–NASD–2003–98, Nasdaq In order to allow for adequate notice business days prior to filing, or such recently amended the various NASD to market participants of this additional shorter time as designated by the rules governing trade reporting to define change, Nasdaq is also proposing to Commission, it has become effective with greater clarity the reporting delay the effective date of SR–NASD– pursuant to Section 19(b)(3)(A) of the obligations applicable to transactions 2003–98 for an additional two weeks, Act 11 and Rule 19b–4(f)(6) 12 executed through ECNs that are reported until November 10, 2003. Nasdaq had thereunder. At any time within 60 days to ACT.7 In general, SR–NASD–2003–98 previously delayed this effective date of the filing of the proposed rule change, was not intended to require ECNs to from October 6, 2003 until October 27, the Commission may summarily 8 modify their current trade reporting 2003. Nasdaq will inform market abrogate such rule change if it appears practices. Rather, the purpose of the participants of the delay and the rule to the Commission that such action is filing was to codify these practices in change through a Head Trader Alert necessary or appropriate in the public the form of clear, enforceable rules to posted on www.nasdaqtrader.com. interest, for the protection of investors, provide greater guidance to market 2. Statutory Basis or otherwise in furtherance of the participants. purposes of the Act. Since the approval of SR–NASD– Nasdaq believes that the proposed Nasdaq has requested that the 2003–98, however, several ECNs have rule change is consistent with the 9 Commission waive the 5-day pre-filing informed Nasdaq that one aspect of the provisions of Section 15A of the Act, in notice requirement and the 30-day rule change would result in an general, and with Section 15A(b)(6) of 10 operative delay. The Commission alternation of current practices (and the Act, in particular, in that it is believes waiving the 5-day pre-filing associated programming costs), and designed to prevent fraudulent and notice requirement and the 30-day Nasdaq has concluded that this manipulative acts and practices, to operative delay is consistent with the alternation would not result in any foster cooperation and coordination protection of investors and the public offsetting benefit. NASD Rule 6130 with persons engaged in regulating, interest. Acceleration of the operative provides that where one ECN routes an clearing, settling, processing date will allow both the trade reporting order to another ECN that executes the information with respect to, and rules approved by the Commission in order, the ECN that executes the order facilitating transactions in securities, SR–NASD–2003–98 and the minor would be responsible for reporting the and to protect investors and the public modification to those rules proposed in transaction, or requiring a subscriber to interest. The proposed rule change will SR–NASD–2003–160 to take effect clarify the trade reporting obligations report the transaction, in accordance without undue delay, thereby lessening associated with transactions conducted with one of the three basic methods for the extent to which ECNs that use ACT through ECNs but will minimize the trade reporting established by the rule. would be required to make non- extent to which ECNs will be required For purposes of allocating trade substantive modifications to their to implement non-substantive reporting responsibility between ECN existing trade reporting practices.13 modifications to existing practices. subscribers, the routing ECN would be IV. Solicitation of Comments deemed to be a market maker. The ECNs B. Self-Regulatory Organization’s that are affected by this rule have Statement on Burden on Competition Interested persons are invited to informed Nasdaq, however, that in such submit written data, views and Nasdaq does not believe that the arguments concerning the foregoing, circumstances they have treated the proposed rule change will result in any routing ECN as an order entry firm. including whether the proposal is burden on competition that is not consistent with the Act. Persons making Thus, where an executing ECN reports necessary or appropriate in furtherance trades for its subscribers and identifies of the purposes of the Act. 11 a subscriber as the reporting party, 15 U.S.C. 78s(b)(3)(A). 12 17 CFR 240.19b–4(f)(6). when the ECN receives an order from a 8 Securities Exchange Act Release No. 48625 13 For purposes only of accelerating the operative (October 10, 2003), 68 FR 59961 (October 20, 2003) date of this proposal, the Commission has 7 Securities Exchange Act Release No. 48442 (SR–NASD–2003–152). considered the proposed rule’s impact on (September 4, 2003), 68 FR 53767 (September 12, 9 15 U.S.C. 78o–3. efficiency, competition, and capital formation. 15 2002) (SR–NASD–2003–98) (approval order). 10 15 U.S.C. 78o–3(b)(6). U.S.C. 78c(f).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66912 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

written submissions should file six Under Phlx Rule 460, multiple the Phlx trading floor.10 The Phlx has copies thereof with the Secretary, specialists, one of which is identified as represented that its current rules, Securities and Exchange Commission, the ‘‘primary specialist,’’ 4 currently policies, and practices with respect to 450 Fifth Street, NW., Washington, DC may trade a particular security on the information barriers and surveillance 20549–0609. Copies of the submission, equity trading floor of the Phlx.5 Prior are adequate to support remote trading all subsequent amendments, all written to the adoption of Phlx Rules 460 and by primary specialists at the Phlx.11 statements with respect to the proposed 229A, each equity security traded on the Moreover, the Phlx has represented that rule change that are filed with the floor of the Phlx was allocated to only it will examine remote primary Commission, and all written one specialist unit. Phlx Rule 460 specialist locations to ensure adequate communications relating to the allows approved specialist units to trade compliance with Phlx rules.12 Thus, the proposed rule change between the one or more securities as ‘‘competing Commission believes that Phlx has Commission and any person, other than specialists.’’ 6 There must be a primary addressed confidentiality issues those that may be withheld from the specialist in a particular security in associated with allowing remote public in accordance with the order for there to be competing primary specialists to trade from remote provisions of 5 U.S.C. 552, will be specialists in that security.7 Competing locations in proximity to a diversified available for inspection and copying in specialists have the same affirmative broker-dealer’s other off-floor the Commission’s Public Reference and negative obligations under Phlx operations. Member firms’ traders Room. Copies of such filing will also be Rule 203 as primary specialists. should not get a market advantage available for inspection and copying at because of their physical proximity to a Pursuant to Phlx Rule 461, the Phlx the principal office of Nasdaq. All specialist trading unit, and vice versa. also operates a program whereby submissions should refer to File No. Based, in part, on the Phlx’s competing Phlx specialist units conduct SR–NASD–2003–160 and should be representation that it has in place specialist trading activities off the Phlx submitted by December 19, 2003. adequate information barrier policies trading floor using PACE 8 terminals and For the Commission, by the Division of and surveillance procedures, the related equipment. The Commission Commission is approving the Phlx’s Market Regulation, pursuant to delegated granted approval of the Phlx’s remote 14 remote primary specialist proposal. authority. competing specialist program subject to Margaret H. McFarland, The Commission finds that the the condition that the Phlx ‘‘have in proposed rule change is consistent with Deputy Secretary. place specific information barrier the requirements of the Act and the [FR Doc. 03–29623 Filed 11–26–03; 8:45 am] policies and surveillance policies that rules and regulations thereunder BILLING CODE 8010–01–P are consistent with the Exchange’s applicable to a national securities existing rules and that are acceptable be exchange.13 Specifically, the the Commission’s Office of Compliance Commission finds that the proposal is SECURITIES AND EXCHANGE Inspections and Examinations COMMISSION consistent with Section 6(b)(5) of the (‘‘OCIE’’).’’ 9 Act,14 which requires, among other things, that the Phlx’s rules be designed [Release No. 34–48816; File No. SR–Phlx– The Phlx now proposes to establish a 2003–10] similar program whereby primary to prevent fraudulent and manipulative specialists would be permitted to acts and practices, to promote just and Self-Regulatory Organizations; Order conduct specialist trading activities off equitable principles of trade, to foster Granting Approval to Proposed Rule cooperation and coordination with Change by the Philadelphia Stock 4 Phlx Rule 229A(b)(5) defines ‘‘primary persons engaged in regulating, clearing, Exchange, Inc. Relating to Remote specialist’’ as follows: settling, processing information with Primary Specialists ‘Primary Specialist’ shall mean the primary respect to, and facilitating transactions specialist identified as such by the Equity in, securities, to remove impediments to November 20, 2003. Allocation, Evaluation, and Securities Committee. The Primary Specialist may be either the Directed and perfect the mechanism of a free and On February 26, 2003, the Specialist or the Non-Directed Specialist in the case open market and a national market Philadelphia Stock Exchange, Inc. of any particular Directed Order. The Primary (‘‘Phlx’’) filed with the Securities and Specialist shall be deemed to be the Directed 10 The Commission reiterates that while the Exchange Commission (‘‘Commission’’), Specialist with respect to any Non-Directed Order. remote specialist program, which now includes 5 See Securities Exchange Act Release No. 45183 primary specialists, may have the effect of attracting pursuant to Section 19(b)(1) of the (, 2001), 67 FR 118 (January 2, 2002) additional order flow to the Phlx, this must occur Securities Exchange Act of 1934 (order approving establishment of a competing consistent with best execution principles. (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a specialist program at the Phlx) (SR–Phlx–2001–97). Accordingly, the broker-dealer must rigorously and proposed rule change to permit 6 Phlx Rule 229A(b)(6) defines ‘‘competing regularly examine the executions likely to be ‘‘primary specialists’’ to trade away specialist’’ as follows: obtained for customer orders in the different ‘Competing Specialist’ shall mean any competing markets trading the security, in addition to any from the Phlx floor in limited specialist identified as such by the Equity other relevant considerations in routing customer circumstances. The proposed rule Allocation, Evaluation, and Securities Committee orders. change was published for comment in pursuant to [Phlx] Rule 460. A Competing 11 Telephone conversation between Carla the Federal Register on September 29, Specialist may be either the Directed Specialist or Behnfeldt, Director, Legal Department New Product 3 the Non-Directed Specialist in the case of any Development Group, Phlx, and Patrick M. Joyce, 2003. The Commission received no particular Directed Order. Special Counsel, Division of Market Regulation, comments on the proposal. This order 7 A Phlx specialist may trade some securities on Commission, on November 19, 2003. approves the Phlx’s proposed rule a primary basis and other securities on a competing 12 Telephone conversation between Edith change. basis, or made trade all its securities on either a Hallahan, Deputy General Counsel, Phlx, and primary or a competing basis. Harmon, Senior Special Counsel, Division 8 PACE is the electronic order routing, delivery of Market Regulation, Commission, on November 14 17 CFR 200.30–3(a)(12). execution, and reporting system used to access the 20, 2003. 1 15 U.S.C. 78s(b)(1). Phlx Equity Floor. See Phlx Rules 229 and 229A. 13 In approving this proposal, the Commission has 2 17 CFR 240.19b–4. 9 Securities Exchange Act Release No. 45184 considered the proposed rule’s impact on 3 See Securities Exchange Act Release No. 48515 (December 21, 2001), 67 FR 622 (, 2002) efficiency, competition, and capital formation. 15 (September 22, 2003), 68 FR 56031 (September 29, (order approving the establishment of the Phlx’s U.S.C. 78c(f). 2003). remote specialist program) (SR–Phlx–2001–98). 14 15 U.S.C. 78f(b)(5).

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00117 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66913

system, and, in general, to protect 5. Georgia District Advisory Council Ombudsman will hold a Public Hearing investors and the public interest. The (formerly Atlanta District Advisory on Tuesday, December 9, 2003 at 1 p.m. Commission believes that the Phlx’s Council) at 1720 Peachtree Street, Room 197, proposal to permit primary specialists to 6. Hawaii District Advisory Council Atlanta, GA 30309, to receive comments trade on a remote basis in limited (formerly Honolulu District Advisory and testimony from small business circumstances may reduce costs, add Council) owners, small government entities, and liquidity, and promote competition, and 7. Houston District Advisory Council small non-profit organizations lead to a greater number of securities 8. Indiana District Advisory Council concerning regulatory enforcement and trading on PACE, thereby benefiting (formerly Indianapolis District compliance actions taken by federal investors. Advisory Council) agencies. It is therefore ordered, pursuant to 9. Louisiana District Advisory Council Anyone wishing to attend or to make Section 19(b)(2) of the Act 15, that the (formerly New Orleans District a presentation must contact Annette proposed rule change (SR–Phlx–2003– Advisory Council) Rodriguez in writing or by fax, in order 10) be, and it hereby is, approved. 10. Maine District Advisory Council to be put on the agenda. Annette For the Commission, by the Division of (formerly Augusta District Advisory Rodriguez, Georgia District Office, 233 Market Regulation, pursuant to delegated Council) Peachtree Street, NE Suite 1900, authority.16 11. Minnesota District Advisory Council Atlanta, GA 30303, phone (404) 331– Margaret H. McFarland, (formerly Minneapolis District 0100 x614, fax (404) 331–0101 or (202) Deputy Secretary. Advisory Council) 481–0288, e-mail: [FR Doc. 03–29662 Filed 11–26–03; 8:45 am] 12. Montana District Advisory Council [email protected]. BILLING CODE 8010–01–P (formerly Helena District Advisory For more information, see our Web Council) site at www.sba.gov/ombudsman. 13. North Florida District Advisory Dated: November 21, 2003. Council SMALL BUSINESS ADMINISTRATION Peter Sorum, 14. Oregon District Advisory Council National Ombudsman (Acting). Charter Re-establishment (formerly Portland District Advisory Council) [FR Doc. 03–29712 Filed 11–26–03; 8:45 am] Re-establishment of Advisory 15. Pittsburgh District Advisory Council BILLING CODE 8025–01–P Committees 16. Rhode Island District Advisory We publish this notice following the Council (formerly Providence District provisions of the Federal Advisory Advisory Council) SOCIAL SECURITY ADMINISTRATION Committee Act (Pub. L. 92–463) to 17. Richmond District Advisory Council renew Small Business Administration 18. Santa Ana District Advisory Council Agency Information Collection (SBA) discretionary Advisory 19. Utah District Advisory Council Activities: Proposed Request and Committees. The General Services (formerly Salt Lake City District Comment Request Administration’s Committee Advisory Council) The Social Security Administration Management Secretariat has determined 20. Vermont District Advisory Council (SSA) publishes a list of information that renewal is in the public interest. (formerly Montpelier District collection packages that will require Advisory Council) 1. National Advisory Council clearance by the Office of Management 21. Washington, DC District Advisory and Budget (OMB) in compliance with The Council will provide advice, Council Pub. L. 104–13, the Paperwork ideas and opinions on SBA programs 22. West Virginia District Advisory Reduction Act of 1995, effective October and small business issues. The Council (formerly Clarksburg District 1, 1995. The information collection Council’s scope of activities includes Advisory Council) packages that may be included in this reviewing SBA programs and informing 23. Wisconsin District Advisory Council notice are for new information SBA of current small business issues. Its (formerly Madison District Advisory collections, approval of existing members provide an essential Council) information collections, revisions to connection between SBA, SBA program FOR FURTHER INFORMATION CONTACT: For OMB-approved information collections, participants, and the small business additional information, contact and extensions (no change) of OMB- community nationwide. Kimberly Mace, Committee approved information collections. 2. District Advisory Councils Management Specialist, 409 Third SSA is soliciting comments on the The District Advisory Councils Street, NW., Washington, DC 20416; accuracy of the agency’s burden provide advice and recommendations to telephone (202) 401–8252. estimate; the need for the information; its practical utility; ways to enhance its the SBA regarding the effectiveness of Scott R. Morris, and need for SBA programs, particularly quality, utility, and clarity; and on ways Deputy Chief of Staff. to minimize burden on respondents, within the local districts. Official [FR Doc. 03–29713 Filed 11–26–03; 8:45 am] designations include: including the use of automated BILLING CODE 8025–01–P collection techniques or other forms of 1. Alabama District Advisory Council information technology. Written (formerly Birmingham District comments and recommendations Advisory Council) SMALL BUSINESS ADMINISTRATION regarding the information collection(s) 2. Buffalo District Advisory Council should be submitted to the OMB Desk 3. Columbus District Advisory Council Public Federal Regulatory Officer and the SSA Reports Clearance 4. Connecticut District Advisory Enforcement Fairness Hearing; Region Officer. The information can be mailed Council (formerly Hartford District IV Regulatory Fairness Board Advisory Council) and/or faxed to the individuals at the The Small Business Administration addresses and fax numbers listed below: 15 15 U.S.C. 78s(b)(2). Region IV Regulatory Fairness Board (OMB), Office of Management and 16 17 CFR 200.30–3(a)(12). and the SBA Office of the National Budget, Attn: Desk Officer for SSA,

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00118 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66914 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

New Executive Building, Room Frequency of Response: 1. Estimated Annual Burden: 417 hours. 10235, 725 17th St., NW, Washington, Average Burden Per Response: 5 II. The information collections listed DC 20503, Fax: 202–395–6974. minutes. below have been submitted to OMB for (SSA), Social Security Administration, Estimated Annual Burden: 879 hours. clearance. Your comments on the DCFAM, Attn: Reports Clearance 3. Request to Resolve Questionable information collections would be most Officer, 1338 Annex Building, 6401 Quarters of Coverage (QC); Request for useful if received by OMB and SSA Security Blvd., Baltimore, MD 21235, QC History Based on Relationship— within 30 days from the date of this Fax: 410–965–6400. 0960–0575. Form SSA–512 is used by publication. You can obtain a copy of I. The information collections listed States to request clarification from SSA the OMB clearance packages by calling below are pending at SSA and will be on questionable QC information. The the SSA Reports Clearance Officer at submitted to OMB within 60 days from Personal Responsibility and Work 410–965–0454, or by writing to the the date of this notice. Therefore, your Opportunity Reconciliation Act states address listed above. 1. Annual Earnings Test Direct Mail comments should be submitted to SSA that aliens admitted for lawful residence Follow-Up Program Notices—20 CFR within 60 days from the date of this who have worked and earned 40 404.452–455—0960–0369. In 1997, as publication. You can obtain copies of qualifying QCs for Social Security part of the initiative to reinvent the collection instruments by calling the purposes can generally receive State government, SSA began to use the SSA Reports Clearance Officer at 410– benefits. Form SSA–513 is used by information reported on W–2’s and self- 965–0454 or by writing to the address States to request QC information for an employment tax returns to adjust listed above. alien’s spouse or child in cases where benefits under the earnings test rather 1. Certificate of Support—20 CFR the alien does not sign a consent form than have beneficiaries make a separate 404.408a, 404.370, and 404.750—0960– giving permission to access his/her report, which often showed the same 0001. The information collected by form Social Security records. QCs can also be information. As a result, beneficiaries SSA–760–F4 is used to determine allocated to a spouse and/or to a child under full retirement age (FRA) whether a deceased worker provided under age 18, if needed, to obtain 40 complete forms SSA–L9778–SM–SUP, one-half support required for qualifying QCs for the alien. The SSA–L9779–SM–SUP and SSA–L9781– entitlement to Social Security parent’s respondents are State agencies that SM under this information collection. or spouse’s benefits. The information require QC information in order to With the passage of the Senior Citizen will also be used to determine whether determine eligibility for benefits. Type of Request: Extension of an Freedom to Work Act of 2000, the the Government pension offset would OMB-approved information collection. annual earnings test (AET) at FRA was apply to the applicant’s benefit eliminated. As a result, SSA designed payments. The respondents are parents Burden Information SSAÐ512 SSAÐ513 two new Midyear Mailer Forms, SSA– of deceased workers or spouses who L9784–SM and SSA–L9785–SM, to may be subject to Government pension Number of Respond- request an earnings estimate (in the year offset. ents ...... 200,000 350,000 of FRA) for the period prior to the Type of Request: Extension of an Frequency of Re- month of FRA. Social Security benefits OMB-approved information collection. sponse ...... 1 1 may be adjusted based on the Number of Respondents: 18,000. Average Burden Per information provided and this Frequency of Response: 1. Response (minute) 2 2 Estimated Annual information is needed to comply with Average Burden Per Response: 15 Burden (hours) ...... 6,667 11,667 the law. Consequently, the Midyear minutes. Mailer program has become an even Estimated Annual Burden: 4,500 4. International Direct Deposit—31 more important tool in helping SSA to hours. CFR 210–0960–NEW. SSA uses the ensure that Social Security payments 2. Notice Regarding Substitution of information collected on the are correct. Respondents are Party Upon Death of Claimant—20 CFR International Direct Deposit (IDD) Form, beneficiaries who must update their 404.957(c)(4) and 416.1457(c)(4)—0960– SSA–1199 (Country), to enroll current year estimate of earnings, give 0288. When a claimant for Social beneficiaries residing abroad in the IDD SSA an estimate of earnings for the Security or Supplemental Security program. There are currently 39 following year and an earnings estimate Income benefits dies while a request for countries where IDD is now available, (in the year of FRA) for the period prior a hearing is pending, the hearing will be and SSA plans to expand this service to to the month of FRA. dismissed unless an eligible individual other countries as it becomes available. Type of Request: Extension of an makes a written request to SSA showing The SSA–1199 (Country) is named OMB-approved information collection. that he or she would be adversely according to the country for its intended Number of Respondents: 225,000. affected by the dismissal of the use, but will always request the same Frequency of Response: 1. deceased’s claim. An individual may basic enrollment information. This form Average Burden Per Response: 10 satisfy this requirement by completing is a variation of the SF–1199 A, Direct minutes. an HA–539. SSA uses the information Deposit Sign-Up Form, which is used to Estimated Annual Burden: 37,500 collected to document the individual’s enroll a beneficiary in direct deposit to hours. request to be made a substitute party for a U.S. financial institution. The 2. Application for Lump Sum Death a deceased claimant, and to make a respondents are beneficiaries living in a Payment—20 CFR 404.390–404.392— decision on whom, if anyone, should foreign country that request Direct 0960–0013. The information collected become a substitute party for the Deposit to a financial institution in their on form SSA–8 by SSA is required to deceased. The respondents are country of residence. authorize payment of a lump-sum death individuals requesting hearings on Type of Request: New information benefit to a widow, widower, or behalf of deceased claimants for Social collection. children as defined in Section 202(i) of Security benefits. Number of Respondents: 5,000. the Social Security Act. The Type of Request: Extension of an Frequency of Response: 1. respondents are widows, widowers or OMB-approved information collection. Average Burden Per Response: 5 children who apply for a lump-sum Number of Respondents: 10,548. minutes. death payment.

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66915

Type of Request: Extension of an applied to a prior determination or Work and Work Incentives Advisory Act OMB-approved information collection. decision by submitting a statement that (TWWIIA). The Panel is also to advise Number of Respondents: 43, 850. demonstrates how the AR could change the Commissioner on matters specified Frequency of Response: 1. the prior determination or decision. in section 101(f)(2)(B) of that Act, Average Burden Per Response: 10 SSA will use the information provided including certain issues related to the minutes. in the statement to readjudicate the Ticket to Work and Self-Sufficiency Estimated Annual Burden: 7,308 claim if the claimant demonstrates the Program established under section hours. Ruling could change the prior 101(a) of that Act. 3. Petition To Obtain Approval Of A determination. The respondents are Agenda: The Panel will deliberate on Fee For Representing A Claimant Before claimants whose determinations or the implementation of TWWIIA and the Social Security Administration—20 decisions on their claims may be conduct Panel business. The Panel will CFR Subpart R, 404.1720, 404.1725, affected by an AR. be discussing the Notice of Proposed Subpart F, 410.686b, Subpart O, Type of Request: Extension of an Rule Making on Expedited 416.1520 and 416.1525—0960–0104. A OMB-approved collection. Reinstatement, its Annual Report and representative of a claimant for Social Number of Respondents: 100,000. follow up items from its November Security benefits must file either a fee Frequency of Response: 1. meeting. The agenda for this meeting petition or a fee agreement with SSA in Average Burden Per Response: 17 will be posted on the Internet at http:/ order to charge a fee for representing a minutes. /www.socialsecurity/work/panel one claimant in proceedings before SSA. Estimated Annual Burden: 28,333 week prior to the teleconference or can The representative uses Form SSA–1560 hours. be received in advance electronically or to petition SSA for authorization to Dated: November 21, 2003. by fax upon request. charge and collect a fee. A claimant may Elizabeth A. Davidson, Contact Information: Records are also use the form to agree or disagree Reports Clearance Officer, Social Security being kept of all Panel proceedings and with the requested fee amount or other Administration. will be available for public inspection information the representative provides [FR Doc. 03–29686 Filed 11–26–03; 8:45 am] by appointment at the Panel office. on the form. SSA uses the information Anyone requiring information regarding BILLING CODE 4191–02–P to determine a reasonable fee that a the Panel should contact the TWWIIA representative may charge and collect Panel staff by: • for his or her services. The respondents SOCIAL SECURITY ADMINISTRATION Mail addressed to Ticket to Work are claimants, their attorneys and other and Work Incentives Advisory Panel persons representing them. The Ticket to Work and Work Staff, Social Security Administration, Type of Request: Extension of an Incentives Advisory Panel 400 Virginia Avenue, SW, Suite 700, OMB-approved information collection. Teleconference Washington, DC, 20024; Number of Respondents: 34, 624. • Telephone contact with Kristen Frequency of Response: 1. AGENCY: Social Security Administration Breland at (202) 358–6430; Average Burden Per Response: 30 (SSA). • Fax at (202) 358–6440; or minutes. ACTION: Notice of teleconference. • E-mail to [email protected]. Estimated Average Burden: 17,312 Dated: November 14, 2003. DATES: Friday, , 2003. hours. Carol Brenner, 4. Student Statement Regarding Teleconference: Friday December 5, School Attendance—20 CFR 404.351– 2003, 1:30 p.m. to 3:30 p.m. Eastern Designated Federal Official. 352, 404.367–.368—0960–0105. The time. [FR Doc. 03–29688 Filed 11–26–03; 8:45 am] information collected on Form SSA– Ticket to Work and Work Incentives BILLING CODE 4191–02–P 1372 is needed to determine whether Advisory Panel Conference Call: children of an insured worker are Call-in number: 888–323–2711. eligible for benefits as a student. The Pass code: PANEL. SOCIAL SECURITY ADMINISTRATION Leader/Host: Sarah Wiggins Mitchell. respondents are student claimants for Senior Executive Service Social Security benefits and their SUPPLEMENTARY INFORMATION: respective schools. Type of meeting: This teleconference AGENCY: Social Security Administration. Type of Request: Extension of an OMB meeting is open to the public. The ACTION: Notice of Senior Executive approved information collection. interested public is invited to Service Performance Review Board Number of Respondents: 200,000. participate by calling into the Membership. Number of Response: 1. teleconference at the number listed Average Burden Per Response: 10 above. Public testimony will not be Title 5, U.S. Code, Section 4314(c)(4) minutes. taken. of the Civil Service Reform Act of 1978, Estimated Annual Burden: 33,333 Purpose: In accordance with section Pub. L. 95–454, requires that the hours. 10(a)(2) of the Federal Advisory appointment of Performance Review 5. Application of Circuit Court Law— Committee Act, the Social Security Board members be published in the 20 CFR 404.985 and 416.1485—0960– Administration (SSA) announces this Federal Register. 0581. SSA regulations at 20 CFR teleconference meeting of the Ticket to The following persons will serve on 404.985 and 416.1485 inform claimants Work and Work Incentives Advisory the Performance Review Board which of their right to request that a published Panel (the Panel). Section 101(f) of Pub. oversees the evaluation of performance Acquiescence Ruling (AR) be applied to L. 106–170 establishes the Panel to appraisals of Senior Executive Service a prior determination when we make a advise the President, the Congress and members of the Social Security determination or decision on a claim the Commissioner of SSA on issues Administration. between the date of the Circuit Court related to work incentives programs, Nicholas M. Blatchford, Philip A. decision and the date we publish the planning and assistance for individuals Gambino, Diane B. Garro, Terris A. AR. The regulations also specify that with disabilities as provided under King, Nancy A. McCullough, Carolyn claimants can request that the AR be section 101(f)(2)(A) of the Ticket to L. Simmons, Felicita Sola-Carter,

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 66916 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices

Frederick G. Streckewald, Paul N. Van Eisenbeiss via e-mail at Frequency of Use: Annually. de Water, Manuel Vaz, Alice H. Wade, [email protected]. DTAG Type of affected Public: State or local John B. Watson, Charles M. Wood members planning to attend the plenary governments, Federal agencies, non- Dated: November 12, 2003. session should notify the DTAG profit institutions, businesses, or other Reginald F. Wells, Secretariat, contact person Mary for-profit. Sweeney via e-mail at Deputy Commissioner for Human Resources. [email protected]. A list will be Small Businesses or Organizations [FR Doc. 03–29687 Filed 11–26–03; 8:45 am] made up for Diplomatic Security and Affected: No. BILLING CODE 4191–02–P the Reception Desk at the 23rd Street Federal Budget Functional Category Entrance. Attendees must present a Code: 999. driver’s license with photo, a passport, Estimated Number of Annual DEPARTMENT OF STATE a U.S. Government ID, or other valid Responses: 45. [Public Notice 4544] photo ID for entry. Estimated Total Annual Burden FOR FURTHER INFORMATION CONTACT: Hours: 180. Defense Trade Advisory Group; Notice Mary F. Sweeney, DTAG Secretariat, Estimated Average Burden Hours Per of Open Meeting U.S. Department of State, Office of Response: 4. AGENCY: Department of State. Defense Trade Controls Management (PM/DTCM), Room 1200, SA–1, Need For and Use of Information: ACTION: Notice. Washington, DC 20522–0112, (202) 663– TVA conducts an annual salary survey The Defense Trade Advisory Group 2865, FAX (202) 663–261–8199. for employee compensation and benefits as a basis for labor negotiations in (DTAG) will meet in open session from Dated: November 24, 2003. determining prevailing rates of pay and 9 a.m. to 12 noon on Wednesday, Michael T. Dixon, December 17, 2003, in Room 1912 at the benefits for represented salary policy Executive Secretary, Defense Trade Advisory employees. TVA surveys firms, and U.S. Department of State, Harry S. Group, Department of State. Truman Building, Washington, DC. Federal, State, and local governments [FR Doc. 03–29736 Filed 11–26–03; 8:45 am] whose employees perform work similar Entry and registration will begin at 8:15. BILLING CODE 4710–25–P Please use the building entrance located to that of TVA’s salary policy at 23rd Street, NW., Washington, DC, employees. between C&D streets. The membership TENNESSEE VALLEY AUTHORITY Jacklyn J. Stephenson, of this advisory committee consists of Senior Manager, Enterprise Operations, private sector defense trade specialists, Paperwork Reduction Act of 1995, as Information Services. appointed by the Assistant Secretary of Amended by Pub. L. 104–13; Proposed [FR Doc. 03–29631 Filed 11–26–03; 8:45 am] State for Political-Military Affairs, who Collection; Comment Request BILLING CODE 8120–08–P advise the Department on policies, regulations, and technical issues AGENCY: Tennessee Valley Authority. affecting defense trade. The purpose of ACTION: Proposed Collection; comment the meeting will be to review progress request. DEPARTMENT OF TRANSPORTATION of the working groups and to discuss current defense trade issues and topics SUMMARY: The proposed information Office of the Secretary for further study. collection described below will be Although public seating will be submitted to the Office of Management Aviation Proceedings, Agreements limited due to the size of the conference and Budget (OMB) for review, as Filed the Week Ending November 14, room, members of the public may attend required by the Paperwork Reduction 2003 this open session as seating capacity Act of 1995 (44 U.S.C. Chapter 35, as allows, and will be permitted to amended). The Tennessee Valley The following Agreements were filed participate in the discussion in Authority is soliciting public comments with the Department of Transportation accordance with the Chairman’s on this proposed collection as provided under the provisions of 49 U.S.C. instructions. Members of the public by 5 CFR Section 1320.8(d)(1). Requests Sections 412 and 414. Answers may be may, if they wish, submit a brief for information, including copies of the filed within 21 days after the filing of statement to the committee in writing. information collection proposed and the application. As access to the Department of State supporting documentation, should be Docket Number: OST–2003–16525. directed to the Agency Clearance facilities is controlled, persons wishing Date Filed: November 13, 2003. to attend the meeting must notify the Officer: Alice D. Witt, Tennessee Valley DTAG Executive Secretariat by COB Authority, 1101 Market Street (EB–5B), Parties: Members of the International Tuesday, December 9, 2003. If notified Chattanooga, TN 37402–2801; (423) Air Transport Association. after this date, the DTAG Secretariat 751–6832. (SC: 0003D1Z) Subject: Comments should be sent to the cannot guarantee that State’s Bureau of PAC/Reso/421 dated August 12, 2003. Diplomatic Security can complete the Agency Clearance Officer no later than necessary processing required to attend January 27, 2004. Finally Adopted Resolutions r1–r42. the December 17 plenary. SUPPLEMENTARY INFORMATION: Minutes—PAC/Meet/179 dated August Each non-member observer or DTAG Type of Request: Regular submission; 12, 2003. member needing building access that proposal for an extension of a currently Intended effective date: January 1, 2004. wishes to attend this plenary session approved collection, which will expire should provide his/her name, company , 2004 (OMB control number Andrea M. Jenkins, or organizational affiliation, phone 3316–0009). Program Manager, Docket Operations, number, date of birth, social security Title of Information Collection: Salary Federal Register Liaison. number, and citizenship to the DTAG Survey for Salary Policy Bargaining Unit [FR Doc. 03–29649 Filed 11–26–03; 8:45 am] Secretariat, contact person Barbara Employees. BILLING CODE 4910–62–P

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00121 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Notices 66917

DEPARTMENT OF TRANSPORTATION Washington, DC 20590. Telephone: Annual Estimated Burden Hours: 768 (202) 366–1624; Fax: (202) 366–6988; or hours. Maritime Administration e-mail: [email protected]. ADDRESSES: Send comments to the Copies of this collection also can be Office of Information and Regulatory Reports, Forms and Recordkeeping obtained from that office. Requirements; Agency Information Affairs, Office of Management and SUPPLEMENTARY INFORMATION: Maritime Collection Activity Under OMB Review Budget, 725 17th Street, NW., Administration (MARAD). Washington, DC 20503, Attention AGENCY: Maritime Administration, DOT. Title: Port Facility Conveyance MARAD Desk Officer. Information. ACTION: Notice and request for Comments are invited on: Whether OMB Control Number: 2133–0524. comments. the proposed collection of information Type of Request: Extension of is necessary for the proper performance SUMMARY: In compliance with the currently approved collection. of the functions of the agency, including Paperwork Reduction Act of 1995 (44 Affected Public: Eligible port entities. whether the information will have U.S.C. 3501 et seq.), this notice Forms: None. practical utility; the accuracy of the Abstract: Pub. L. 103–160, which is announces that the Information agency’s estimate of the burden of the included in 40 U.S.C. 554 authorizes the Collection abstracted below has been proposed information collection; ways Department of Transportation to convey forwarded to the Office of Management to enhance the quality, utility and to public entities surplus Federal and Budget (OMB) for review and clarity of the information to be property needed for the development or approval. The nature of the information collected; and ways to minimize the operation of a port facility. The collection is described as well as its burden of the collection of information information collection will allow expected burden. The Federal Register on respondents, including the use of MARAD to approve the conveyance of Notice with a 60-day comment period automated collection techniques or property and administer the port facility soliciting comments on the following other forms of information technology. conveyance program. The collection is collection of information was published A comment to OMB is best assured of necessary for MARAD to determine on September 12, 2003. No comments having its full effect if OMB receives it whether the community is committed to were received. within 30 days of publication. the redevelopment/reuse plan; the DATES: Comments must be submitted on redevelopment/reuse plan is viable and Dated: November 21, 2003. or before December 29, 2003. is in the best interest of the public; and Joel C. Richard, FOR FURTHER INFORMATION CONTACT: the property is being used in accordance Secretary, Maritime Administration. Keith Lesnick, Maritime Administration with the terms of the conveyance and [FR Doc. 03–29619 Filed 11–26–03; 8:45 am] (MAR–830), 400 7th Street, SW., applicable statutes and regulations. BILLING CODE 4910–81–P

VerDate jul<14>2003 18:57 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 E:\FR\FM\28NON1.SGM 28NON1 Friday, November 28, 2003

Part II

Department of Health and Human Services Centers for Medicare & Medicaid Services

42 CFR Parts 412, 413, and 424 Medicare Program; Prospective Payment System for Inpatient Psychiatric Facilities; Proposed Rule

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\28NOP2.SGM 28NOP2 66920 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

DEPARTMENT OF HEALTH AND building. A stamp-in clock is available 1. Description of the TEFRA Payment HUMAN SERVICES for persons wishing to retain a proof of Methodology filing by stamping in and retaining an 2. BBA Amendments to TEFRA Centers for Medicare & Medicaid extra copy of the comments being filed.) 3. BBRA Amendments to TEFRA Services 4. BIPA Amendments to TEFRA Comments mailed to the addresses II. Overview of the Proposed IPF Prospective indicated as appropriate for hand or Payment System 42 CFR Parts 412, 413, and 424 courier delivery may be delayed and A. Use of Diagnostic Codes for Payment [CMS–1213–P] could be considered late. 1. ICD For information on viewing public 2. DRGs RIN 0938–AL50 comments, see the beginning of the B. Limitations of the DRG System for SUPPLEMENTARY INFORMATION section. Psychiatric Patients Medicare Program; Prospective C. Proposed DRG Adjustments Under the FOR FURTHER INFORMATION CONTACT: Payment System for Inpatient Proposed IPF Prospective Payment Janet Samen, (410) 786–4533. Philip Psychiatric Facilities System Cotterill, (410) 786–6598, for D. DRGs not Recognized in the Proposed AGENCY: Centers for Medicare & information regarding the regression IPF Prospective Payment System Medicaid Services (CMS), HHS. analysis. E. Applicability of the Proposed IPF Prospective Payment System ACTION: Proposed rule. SUPPLEMENTARY INFORMATION: Inspection of Public Comments: III. Development of the Proposed IPF Per SUMMARY: This rule proposes a Diem Payment Amount Comments received timely will be A. Proposed Market Basket prospective payment system for available for public inspection as they Medicare payment of inpatient hospital B. Development of the Proposed Case-Mix are received, generally beginning Adjustment Regression. services furnished in psychiatric approximately 4 weeks after publication 1. Proposed Patient-Level Characteristics hospitals and psychiatric units of acute of a document, at the headquarters of a. DRGs care hospitals. This rule proposes to the Centers for Medicare & Medicaid b. Comorbidities implement section 124 of the Medicare, Services, 7500 Security Boulevard, c. Patient Age and Gender Medicaid, andSCHIP Balanced Budget Baltimore, Maryland 21244, Monday d. Length of Stay 2. Proposed Facility-Level Characteristics Refinement Act of 1999 (BBRA), which through Friday of each week from 8:30 requires the implementation of a per a. Rural Location a.m. to 4 p.m. To schedule an b. Teaching Status diem prospective payment system for appointment to view public comments, hospital services of psychiatric hospitals c. Disproportionate Share Hospital Status phone (410) 786–9994. d. Psychiatric Units in General Acute Care and psychiatric units. The prospective Copies: To order copies of the Federal Hospitals payment system described in this Register containing this document, send e. Adjustment for Alaska and Hawaii IPFs proposed rule would replace the your request to: New Orders, 3. Proposed Payment Adjustments reasonable cost-based payment system Superintendent of Documents, P.O. Box a. Proposed Outlier Adjustment currently in effect. 371954, Pittsburgh, PA 15250–7954. b. Methodology for Proposed Outlier DATES: We will consider comments if Specify the date of the issue requested Payments we receive them at the appropriate c. Proposed Implementation of the Outlier and enclose a check or money order Policy address, as provided below, no later payable to the Superintendent of 1. Statistical Accuracy of Cost-to-Charge than 5 p.m. on January 27, 2004. Documents, or enclose your Visa or Ratio ADDRESSES: In commenting, please refer Master Card number and expiration 2. Adjustment of IPF Outlier Payments to file code CMS–1213–P. Because of date. Credit card orders can also be d. Computation of Proposed Outlier staff and resource limitations, we cannot placed by calling the order desk at (202) Payments accept comments by facsimile (FAX) 512–1800 (or toll-free at 1–888–293– e. Interrupted Stays transmission. Mail written comments 6498) or by faxing to (202) 512–2250. C. Development of the Proposed Budget- (one original and two copies) to the The cost for each copy is $10. As an Neutral Federal Per Diem Base Rate 1. Data Used to Develop the Proposed following address ONLY: Centers for alternative, you can view and Federal Per Diem Base Rate Medicare & Medicaid Services, photocopy the Federal Register 2. Calculation of the Proposed Per Diem Department of Health and Human document at most libraries designated Amount Services, Attention: CMS–1213–P, P.O. as Federal Depository Libraries and at 3. Determining the Proposed Update Box 8012, Baltimore, MD 21244–8012. many other public and academic Factors for the Budget-Neutrality Please allow sufficient time for mailed libraries throughout the country that Calculation comments to be received timely in the receive the Federal Register. a. Cost Report Data for April 1, 2004 event of delivery delays. This Federal Register document is through June 30, 2005 If you prefer, you may deliver (by also available from the Federal Register b. Estimate of Total Payments under the online database through GPO Access, a TEFRA Payment System hand or courier) your written comments c. Payments Under the Proposed (one original and two copies) to one of service of the U.S. Government Printing Prospective Payment System without a the following addresses: Room 445–G, Office. The Web site address is: http:// Budget-Neutrality Adjustment Hubert H. Humphrey Building, 200 www.access.gpo.gov/nara/index.html. d. Calculation of the Proposed Budget- Independence Avenue, SW., To assist readers in referencing Neutrality Adjustment Washington, DC 20201, or Room C5–14– sections contained in this document, we 4. The Proposed Behavioral Offset 03, 7500 Security Boulevard, Baltimore, are providing the following table of 5. Proposed Federal Per Diem Base Rate MD 21244–1850. (Because access to the contents. 6. Proposed Changes to Physician interior of the HHH Building is not Recertification Requirements Table of Contents E. Proposed Area Wage Adjustment readily available to persons without I. Background F. Effect of the Proposed Transition on Federal Government identification, A. General and Legislative History Budget Neutrality commenters are encouraged to leave B. Overview of the Payment System for G. Calculation of the Proposed Payment their comments in the CMS drop slots Psychiatric Hospitals and Psychiatric IV. Implementation of the Proposed IPF located in the main lobby of the Units before the BBA Prospective Payment System

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66921

A. Proposed Transition IPFs Inpatient psychiatric facilities payment system for the following B. New Providers IRFs Inpatient rehabilitation facilities excluded hospitals: C. Claims Processing LTCHs Long-term care hospitals • Rehabilitation hospitals (including D. Periodic Interim Payments (PIP) MedPAR Medicare provider analysis units in acute care hospitals). E. Limitation on Beneficiaries Charges • Psychiatric hospitals (including V. Future Updates and review file PIP Periodic interim payments units in acute care hospitals. A. Proposed Annual Update Strategy • B. Update of the ICD Codes and DRGs TEFRA Tax Equity and Fiscal LTCHs. C. Future Refinements Responsibility Act of 1982, (Pub. L. The BBA also imposed national limits 1. RTI International’’ (trade name of 97–248) (or caps) on hospital-specific target Research Triangle Institute) amounts (that is, annual per discharge a. Mode of Practice I. Background limits) for these hospitals until cost b. Patient Characteristics A. General and Legislative History reporting periods beginning on or after c. Analysis October 1, 2002. A detailed description 2. University of Michigan Research When the Medicare statute was of the TEFRA payment methodology is 3. Case-Mix Tool originally enacted in 1965, Medicare VI. Provisions of the Proposed Rule provided in section I.B.1. of this payment for hospital inpatient services proposed rule. VII. Collection of Information Requirements was based on the reasonable costs VIII. Response to Comments Section 124 of the BBRA mandated IX. Regulatory Impact Statement incurred in furnishing services to that the Secretary—(1) develop a per A. Overall Impact Medicare beneficiaries. Section 223 of diem prospective payment system for B. Anticipated Effects the Social Security Act Amendments of inpatient hospital services furnished in 1. Budgetary Impact 1972 (Pub. L. 92–603) amended section psychiatric hospitals and psychiatric 2. Impact on Providers 1861(v)(1) of the Social Security Act units; (2) include in the prospective 3. Results (the Act) to set forth limits on payment system an adequate patient a. Facility Type reasonable costs for hospital inpatient b. Location classification system that reflects the c. Teaching Status services. The statute was later amended differences in patient resource use and d. Census Region by section 101(a) of the Tax Equity and costs among psychiatric hospitals and e. Size Fiscal Responsibility Act of 1982 psychiatric units; (3) maintain budget 4. Effect on the Medicare Program (TEFRA) (Pub. L. 97–248) to limit neutrality; (4) permit the Secretary to 5. Effect on Beneficiaries payment by placing a limit on allowable require psychiatric hospitals and 6. Computer Hardware and Software costs per discharge. psychiatric units to submit information C. Alternatives Considered The Congress directed necessary for the development of the Regulation Text implementation of a prospective Addendum A: Proposed Psychiatric prospective payment system; and (5) Prospective Payment Adjustment payment system for acute care hospitals submit a report to the Congress Addendum B1: Proposed Pre-Reclassified in 1983, with the enactment of Pub. L. describing the development of the Wage Index for Urban Areas 98–21. Section 601 of the Social prospective payment system. Addendum B2: Proposed Wage Index for Security Amendments of 1983 (Pub. L. Section 124 also required that the Rural Areas 98–21) added a new section 1886(d) to payment system for inpatient Addendum C: Proposed Case-Mix the Act that replaced the reasonable psychiatric services be implemented for Assessment Tool cost-based payment system for most cost reporting periods beginning on or Acronyms hospital inpatient services with a after October 1, 2002. The creation of each new payment system requires an Because of the many terms to which prospective payment system. extraordinary amount of lead-time to we refer by acronym in this proposed Although most hospital inpatient rule, we are listing the acronyms used services became subject to the develop and implement the necessary and their corresponding terms in prospective payment system, certain changes to our existing computerize alphabetical order below: specialty hospitals were excluded from claims processing systems. In order to the prospective payment system and meet the BBRA requirement to develop BBA Balanced Budget Act of 1997, (Pub. continued to be paid reasonable costs an adequate patient classification L. 105–33) subject to limits imposed by TEFRA. system, we undertook two research BBRA Medicare, Medicaid and SCHIP These hospitals included psychiatric projects. It became apparent that the two [State Children’s Health Insurance hospitals and psychiatric units in acute research projects could not be Program] Balanced Budget care hospitals, long-term care hospitals completed in time for us to implement Refinement Act of 1999, (Pub. L. (LTCHs), children’s hospitals, and an inpatient psychiatric facility 106–113) BIPA Medicare, Medicaid, and SCHIP rehabilitation hospitals and units. prospective payment system by October [State Children’s Health Insurance Cancer hospitals were added to the list 1, 2002. It was impossible for us to Program] Benefits Improvement and of excluded hospitals by section 6004(a) analyze our existing administrative data Protection Act of 2000, (Pub. L. of the Omnibus Budget Reconciliation in a sufficient amount of time to go 106–554) Act of 1989 (Pub. L. 101–239). through notice and comment CMS Centers for Medicare & Medicaid The Congress enacted various rulemaking and implementation of the Services DSM–IV–TR Diagnostic provisions in the Balanced Budget Act inpatient psychiatric facility prospective and Statistical Manual of Mental of 1997 (BBA) (Pub. L. 105–33), the payment system by the statutory Disorders Fourth Edition—Text Medicare, Medicaid, and SCHIP [State deadline. This delay enabled us to Revision Children’s Health Insurance Program] analyze our existing administrative data DRGs Diagnosis-related groups Balanced Budget Refinement ACT to determine the feasibility and validity FY Federal fiscal year (BBRA) (Pub. L. 106–113), and the of using these data to develop the HCRIS Hospital Cost Report Information Medicare, Medicaid, and SCHIP proposed inpatient psychiatric facility System Benefits Improvement and Protection prospective payment system. We are ICD–9-CM International Classification of Act (BIPA) (Pub. L. 106–554) to replace using a combination of available facility Diseases, 9th Revision, Clinical the cost-based methods of and patient specific data for this Modification reimbursement with a prospective proposed rule. Our research efforts will

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66922 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

continue and will be used to refine the limits under TEFRA can be found in the payments for excluded psychiatric and proposed system. final rule concerning the hospital rehabilitation hospitals and units and In this proposed rule, as required inpatient prospective payment system LTCHs, for portions of cost reporting under section 124 of the BBRA, we set published in the Federal Register on periods occurring during the period of forth the proposed Medicare prospective September 1, 1983 (48 FR 39746). October 1, 1997, through September 30, payment system for psychiatric The base year for a facility varied, 2002. hospitals and psychiatric units of acute depending on when the facility was • Section 4414 of the BBA amended care hospitals. We note that many initially determined to be a prospective section 1886(b)(3) of the Act to establish hospitals have ‘‘psychiatric units,’’ payment system-excluded provider. The caps on the target amounts for excluded however; only those units that are base year for facilities that were hospitals and units at the 75th separately certified from the hospital established before the implementation percentile of target amounts for similar and meet the requirements of § 412.23, of the TEFRA provision was 1982. For facilities for cost reporting periods § 412.25, and § 412.27 are excluded facilities established after the beginning on or after October 1, 1997, from the hospital inpatient prospective implementation of the TEFRA through September 30, 2002. The caps payment system and would be subject to provision, facilities were allowed to on these target amounts apply only to this proposed prospective payment choose which of their first 3 cost- psychiatric and rehabilitation hospitals system. Psychiatric units that are reporting years would be used in the and units and LTCHs. Payments for currently paid under the hospital future to determine their target limit. In these excluded hospitals and units are inpatient prospective payment system 1992, the ‘‘new provider’’ period was based on the lesser of a provider’s cost and do not meet the requirements of shortened to 2 full years of cost- per discharge or its hospital-specific § 412.22, § 412.25 and § 412.27 would reporting periods (§ 413.40(f)(1)). cost per discharge, subject to this cap. Excluded facilities whose costs were not be paid under the proposed IPF • Section 4415 of the BBA amended below their target amounts would prospective payment system. The section 1886(b)(1) of the Act by revising receive bonus payments equal to the proposed system includes an adequate the percentage factors used to determine lesser of half of the difference between patient classification system that would the amount of bonus and relief costs and the target amount, up to a result in higher prospective payments to payments and establishing continuous maximum of 5 percent of the target providers treating more costly, resource improvement bonus payments for amount, or the hospital’s costs. For intensive patients using statistically excluded hospitals and units for cost excluded hospitals whose costs objective criteria. reporting periods beginning on or after exceeded their target amounts, Medicare We are proposing to establish a base October 1, 1997. If a hospital is eligible provided relief payments equal to half payment rate that would be paid to for the continuous improvement bonus, of the amount by which the hospital’s inpatient psychiatric facilities for each the bonus payment is equal to the lesser costs exceeded the target amount up to day of inpatient psychiatric care (the of: (1) 50 percent of the amount by 10 percent of the target amount. Federal per diem base rate). The which operating costs are less than Excluded facilities that experienced a proposed base rate would be adjusted by expected costs; or (2) 1 percent of the more significant increase in patient certain proposed patient-level and target amount. facility-level characteristics. acuity could also apply for an additional • amount as specified in § 413.40(d) for Sections 4416 and 4419 of the BBA B. Overview of the Payment System for Medicare exception payments. amended sections 1886(b) of the Act to Psychiatric Hospitals and Psychiatric establish a new framework for payments Units Before the BBA 2. BBA Amendments to TEFRA for new excluded providers. Section The BBA amendments to section 1886 4416 added a new section 1886(b)(7) to 1. Description of the TEFRA Payment the Act that established a new statutory Methodology of the Act significantly altered the payment provisions for hospitals and methodology for new psychiatric and Hospitals and units that are excluded units paid under the TEFRA provisions rehabilitation hospitals and units, and from the hospital inpatient prospective and added other qualifying criteria for LTCHs. Under section 4416, payment to payment system under section certain hospitals excluded from the these providers for their first two cost 1886(d)(1)(B) of the Act are paid for hospital inpatient prospective payment reporting periods is limited to the lesser their inpatient operating costs under the system. A complete explanation of these of the operating costs per case, or 110 provisions of Pub. L. 97–248 (TEFRA). amendments can be found in the final percent of the national median of target The TEFRA provisions are found in rule concerning the hospital inpatient amounts, as adjusted for differences in section 1886(b) of the Act and prospective payment system we wage levels, for the same class of implemented in regulations at 42 CFR published in the Federal Register on hospital for cost reporting periods Part 413. TEFRA established payments August 29, 1997 (62 FR 45966). ending during FY 1996, updated to the based on hospital-specific limits for The BBA made the following changes applicable period. inpatient operating costs. As specified to section 1886 of the Act for TEFRA 3. BBRA Amendments to TEFRA in § 413.40, TEFRA established a ceiling hospitals: on payments for hospitals excluded • Section 4411 of the BBA amended The BBRA of 1999 refined some of the from the acute care hospital inpatient section 1886(b)(3)(B) of the Act and policies mandated by the BBA for prospective payment system. A ceiling restricted the rate-of-increase hospitals and units paid under the on payments is determined by percentages that are applied to each TEFRA provisions. The provisions of calculating the product of a facility’s provider’s target amount so that the BBRA, which amended section base year costs (the year in which its excluded hospitals and units 1886(b)(3)(H) of the Act, were explained target reimbursement limit is based) per experiencing lower inpatient operating in detail and implemented in the discharge, updated to the current year costs relative to their target amounts hospital inpatient prospective payment by a rate-of-increase percentage, and receive lower rates of increase. system interim final rule published in multiplied by the number of total • Section 4412 of the BBA amended the Federal Register on August 1, 2000 current year discharges. A detailed section 1886(g) of the Act to establish a (65 FR 47026) and in the hospital discussion of target amount payment 15-percent reduction in capital inpatient prospective payment system

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66923

final rule also published on August 1, characteristics that were found in the • Coding policy (see section II. A.) 2000 (65 FR 47054). regression analysis to be associated with that would—(1) require IPFs to report With respect to the TEFRA payment statistically significant cost differences patient diagnoses using the methodology, section 4414 of the BBA (see section III.B. of this proposed rule). International Classification of Diseases- had provided for caps on target amounts The variance explained by patient 9th Revision, Clinical Modification for excluded hospitals and units for cost characteristics (19 percent) in the (ICD–9–CM) code set to report the reporting periods beginning on or after regression analysis is limited by the psychiatric diagnosis; and (2) select the October 1, 1997. Section 121 of the nature of the administrative data used to diagnosis-related groups (DRGs) that BBRA amended section 1886(b)(3)(H) of develop this system, which assigns would be used for payment adjustments the Act to provide for an appropriate average facility routine costs to in this proposed rule. wage adjustment to these caps on the individual patients. We are conducting A. Use of Diagnostic Codes for Payment target amounts for certain hospitals and research to better understand the units paid under the TEFRA provisions, relationship between individual patient The patient’s principal diagnosis of effective for cost reporting periods characteristics and average facility his or her physical or mental condition beginning on or after October 1, 1999 routine costs that could be incorporated is essential because it typically acts as through September 30, 2002. into the payment system in future a guide for treatment and validates payment. It is for these reasons that 4. BIPA Amendments to TEFRA updates. We note that ancillary costs are already identifiable at the individual diagnostic information is routinely Section 306 of BIPA amended section patient level. reported on hospital claims and is used 1886 of the Act by increasing the • Implement an April 1, 2004 in other prospective payment systems. incentive payments for psychiatric effective date and a 3-year transition In mental health treatment, the hospitals and psychiatric units to 3 period. As explained in section IV of principal tool recognized and utilized percent for cost reporting periods this proposed rule, it ultimately may be by the psychiatric community for beginning on or after October 1, 2000 necessary to delay implementation diagnostic assessment is the Diagnostic and before October 1, 2001. beyond April 2004 as well as to increase and Statistical Manual of Mental II. Overview of the Proposed IPF the length of the transition period. Disorders (DSM). The DSM provides a Prospective Payment System However, the rate development, budget- broad and comprehensive description of neutrality adjustment, and impact patients through behavioral domains, or As required by statute, we are analysis assume an April 1, 2004 ‘‘axes.’’ This multiaxial system is proposing a per diem prospective effective date and a 3-year transition routinely used by clinical staff to payment system for psychiatric period. diagnose patients and plan treatment. hospitals and psychiatric units • Include research information for The DSM is currently in its fourth (hereinafter referred to as inpatient future refinement of the proposed revision text revision (DSM–IV–TR). psychiatric facilities (IPFs)) that would patient classification system. Part of this Although, the DSM is used for patient replace the current reasonable cost- research could result in a new patient assessment by IPFs, the ICD–9–CM based payment system under the TEFRA assessment instrument that could coding system is used currently for provisions. In this rule, we are identify additional patient level reporting diagnostic information for proposing to base the system on data characteristics. payment purposes. from the 1999 Medicare Provider In addition, we are proposing to make 1. ICD Analysis and Review (MedPAR) file, the following types of adjustments to which includes patient characteristics appropriately make payments on a per- The ICD coding system was designed (for example, patients’ diagnoses and diem basis: for the classification of morbidity and age), and data from the 1999 Hospital • Patient-level adjustments for age, mortality information for statistical Cost Report Information System specified diagnosis-related groups, and purposes and for the indexing of (HCRIS), which includes facility selected high cost comorbidity hospital records by disease. Chapter characteristics (for example, location categories. These patient-level Five of the ICD–9–CM includes the and teaching status). We are using the characteristics explain approximately 19 codes for mental disorders. 1999 MedPAR and HCRIS data because percent of the variance in the cost of In addition, the following definitions they are the best available data. psychiatric care in the administrative (as described in the 1984 Revision of the Based on our analysis, we are data, which establishes the empirical Uniform Hospital Discharge Data Set) proposing the following methodology as basis for this methodology. are requirements of the ICD–9–CM the basis of the proposed IPF • Facility adjustments that include a coding system. prospective payment system: wage index adjustment, rural location • Diagnoses include all diagnoses that • Compute a Federal per diem base adjustment, and an indirect teaching affect the current hospital stay. • rate to be paid to all psychiatric adjustment. These facility Principal diagnosis is defined as the hospitals and psychiatric units based on characteristics explain approximately 13 condition established, after study, to be the sum of the average routine percent of the variance in the costs of chiefly responsible for occasioning the operating, ancillary, and capital costs psychiatric care in the administrative admission of the patient to the hospital for each patient day of psychiatric care data. for care. • in an IPF adjusted for budget neutrality • Variable per diem adjustments to Other diagnoses (also called (see section III.C. of this proposed rule). recognize the higher costs incurred in secondary diagnoses or additional In computing the Federal per diem base the early days of a psychiatric stay. diagnoses) are defined as all conditions rate, our analysis showed that routine • Outlier adjustments to target greater that coexist at the time of admission, operating and capital represent payment to the high cost cases. that develop subsequently, or that affect approximately 88 percent of total costs We are also proposing the following the treatment received or the length of and the remaining 12 percent of total policies: stay or both. Diagnoses that relate to an costs are for ancillary services. • Interrupted stay policy for the earlier episode of care and have no • Adjust the Federal per diem base purpose of applying the variable per bearing on the current hospital stay are rate to reflect certain patient and facility diem adjustment and the outlier policy. excluded.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66924 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

We are proposing to require IPFs to consistent with the Standards for based on the principal diagnosis (ICD– use the psychiatric diagnosis codes in Electronic Transaction final rule 9–CM code) reported by the IPF as one Chapter Five (‘‘Mental Disorder’’) of the published in the Federal Register on adjustment to the Federal per diem base ICD–9–CM to report diagnostic August 17, 2000 (65 FR 50312). The rate. information for the proposed IPF ICD–9–CM coding system is currently In making this decision, we analyzed prospective payment system. All designated as the standard medical data past research as well as a recent study changes to the ICD coding system that code set for capturing cause and supported by the American Psychiatric would affect the proposed IPF manifestation of injury, disease, Association (APA). In the study, APA prospective payment system would be impairments, or other health problems. partnered with the Health Economics addressed annually in the hospital These guidelines are available through a and Outcomes Research Institute inpatient prospective payment system number of sources, including the (THEORI), a division of the Greater New rules. The updated codes are effective following Web site: http://www.cdc.gov/ York Hospital Association, to assess October 1 of each year and must be used nch/data/icdguide.pdf. whether our existing administrative data to report diagnostic or procedure Current regulations at § 412.27 require could be used to develop a prospective information. (Additional information that a psychiatric unit admit only those payment system for IPFs. This study regarding updates to the ICD–9–CM and patients who have a principal diagnosis found that a prospective payment DRGs is included in section V.B. of this that is listed in the DSM or classified in system for IPFs could be developed proposed rule). The official version of Chapter Five (‘‘Mental Disorders’’) of based on existing CMS administrative the ICD–9–CM is available on CD–ROM the ICD–9–CM. The hospital must data, be clinically relevant, and limit the from the U.S. Government Printing maintain records that substantiate the administrative burden on providers. The Office. The FY 2004 version can be psychiatric diagnoses of its patients. We system they proposed included an ordered by contacting the specifically request public comments on adjustment for DRG assignment. Superintendent of Documents, U.S. continuing to reference the DSM in light In summary, we acknowledge that the Government Printing Office, Department of the proposed requirement that IPFs psychiatric community uses the DSM as 50, Washington, D.C. 20402–9329, use the ICD–9–CM code set in the a tool to diagnose a patient’s mental telephone: (202) 512–1800. The stock proposed IPF prospective payment illness and to aid in treatment planning. number is 017–022–01544–7, and the system. However, we are proposing to require price is $25.00. In addition, private IPFs to report diagnoses in Chapter Five B. Limitations of the DRG System for of the ICD–9–CM as required by the vendors publish the ICD–9–CM. Psychiatric Patients Questions and comments concerning Administrative Simplification the codes should be addressed to: Adopting a patient classification Provisions found in 45 CFR subchapter Patricia E. Brooks, Co-Chairperson, ICD– system for IPFs based on diagnosis C. In addition, we are proposing to 9–CM Coordination and Maintenance alone may not explain the wide identify specific DRGs for payment Committee, CMS, Center for Medicare variation in resource use among patients adjustment under the proposed IPF Management, Purchasing Policy Group, in IPFs for several reasons. For instance, prospective payment system. The Division of Acute Care, Mailstop C4– the diagnosis may not fully capture the rationale for the selection of the 08–06, 7500 Security Boulevard, reasons for hospitalization. A patient proposed DRGs for use in the proposed Baltimore, Maryland 21244–1850. with a chronic disorder, like IPF prospective payment system is Comments may be sent via e-mail to: schizophrenia, may be admitted for a described below. [email protected]. variety of acute problems (suicide attempt, catatonic withdrawal, or C. Proposed DRG Adjustments Under 2. DRGs psychotic episode) that require very the Proposed IPF Prospective Payment DRGs constitute the patient different treatments (Goldman, H.H., System classification system used in the Pincus, H.A., Taube, C.A., and Reiger, As noted above, the principal hospital inpatient prospective payment D.A. (1984). Hospital and Community diagnosis is defined as the condition, system. DRGs provide a means of Psychiatry, 35(5): 460–464). after study (clinical evaluation), to be relating the types of patients treated by Further, treatment patterns are more chiefly responsible for admitting the a hospital to the costs incurred by the variable in psychiatry, with multiple patient to the hospital for care. Despite hospital. While each patient is unique, clinically accepted methods of care. As this longstanding definition, our review groups of patients have demographic, a result, resource use varies of hospital claims data that were used diagnostic, and therapeutic attributes in substantially between acute care and to develop the proposed IPF prospective common that determine their level of chronic care patients, and between the payment system indicates that a resource intensity. facilities that treat predominately one substantial number of claims have non- Currently, IPF claims include ICD–9– type of patient. For example, public psychiatric diagnoses identified as the CM diagnosis coding information. The psychiatric hospitals tend to treat the principal diagnosis. TEFRA payment methodology does not chronically mentally ill, with Medicare regulations as specified in use the DRG classification of IPF cases. substantially longer lengths of stay, § 412.27(a) require psychiatric units of Nonetheless, when IPF claims are compared to the patients generally acute care hospitals to admit only those submitted to us, the DRG associated treated in psychiatric units and private patients with a principal diagnosis in with the patient’s principal ICD–9–CM psychiatric hospitals. the DSM or Chapter Five (‘‘Mental diagnosis code is assigned to the claim Predicated on the analysis of the Disorders’’) in the ICD–9–CM. by the GROUPER software program. As administrative data and pending Therefore, if a patient is admitted to a a result, our administrative data refinements from the research, we general hospital for a medical condition includes the DRG assignments for all believe the DRG is an appropriate such as pneumonia, and also presents IPF cases. method to account for certain, although psychiatric symptoms, which We are proposing to require IPFs to not all, clinical characteristics and necessitates an admission to the use the psychiatric diagnosis codes in associated resources. Therefore, under psychiatric unit, the principal diagnosis Chapter Five (‘‘Mental Disorders’’) of this prospective payment system, we are for the admission to the psychiatric unit the ICD–9–CM. This decision is proposing to assign a DRG to each case should be the psychiatric symptoms

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66925

exhibited by the patient in accordance the DSM–IV–TR to establish diagnoses As a result of this analysis, we with § 412.27(a). We note that current and current regulations at § 412.27(a) identified 25 DRGs with one or more regulations applicable to psychiatric refer to DSM diagnoses. However, most, psychiatric diagnoses that are included hospitals (§ 412.23(a)) do not include but not all, DSM codes crosswalk to the in Chapter Five of the ICD–9–CM as these requirements, however, codes in Chapter Five of the ICD–9–CM. well as those diagnoses that are in other historically, psychiatric hospitals have Although, all the DSM codes are chapters of the ICD–9–CM. We are limited admissions to psychiatric psychiatric, some of the corresponding proposing payment adjustments for 15 patients. Section 412.27(a) also requires ICD–9–CM codes are located in other out of the 25 DRGs we analyzed. The that patients be admitted to the chapters of the ICD–9–CM coding remaining 10 DRGs include codes for a psychiatric units for active treatment system and are linked to the body specific range of diseases other than that is of an intensity that can be system affected. For example, the DSM psychiatric, but have a few codes for furnished appropriately only in an diagnosis, Male Erectile Disorder, DSM diagnoses that are included in inpatient hospital setting. For this Chapter Five or other body system crosswalks to ICD–9–CM code 607.84, reason, in order to be paid under the chapters of the ICD–9–CM. The Impotence of Organic Nature which is proposed IPF prospective payment rationale for our decisions regarding system, patients must be capable of found in Chapter 10, Diseases of the these 10 codes is provided in section participating in an active treatment Genitourinary Systems. Accordingly, we II.D. below. program. also analyzed the DRG assignments for Table 1 below lists the DRGs that we In selecting the proposed DRGs for certain ICD–9–CM codes that are based are proposing to recognize under the payment adjustment, we analyzed the on DSM diagnoses but are not in proposed IPF prospective payment DRG assignments for ICD–9–CM Chapter Five of the ICD–9–CM. These system and the proposed adjustment diagnosis codes in Chapter Five. In codes are discussed in the next section factors. This information also is addition, as noted previously, IPFs use of this proposed rule. presented in Addendum A.

TABLE 1.—PROPOSED IPF PROSPECTIVE PAYMENT SYSTEM DRGS

Adjustment DRG Description Factor

12 ...... Degenerative Nervous System Disorders ...... 1.07 23 ...... Nontraumatic Stupor and Coma ...... 1.10 424* ...... O.R. Procedure with Principal Diagnosis of Mental Illness ...... 1.22 425 ...... Acute Adjustment Reaction and Psychosocial Dysfunction ...... 1.08 426 ...... Depressive Neurosis ...... 1.00 427 ...... Neurosis Except Depressive ...... 1.01 428 ...... Disorders of Personality and Impulse Control ...... 1.03 429 ...... Organic Disturbances and Mental Retardation ...... 1.02 430 ...... Psychosis ...... 1.00 431 ...... Childhood Mental Disorders ...... 1.02 432 ...... Other Mental Disorder Diagnoses ...... 0.96 433** ...... Alcohol/Drug Abuse or Dependence, Left Against Medical Advice ...... 0.88 521 ...... Alcohol/Drug Abuse or Dependence with Complication or Comorbidity ...... 1.02 522 ...... Alcohol/Drug Abuse or Dependence with Rehabilitation Therapy without Complication or Comorbidity ...... 0.97 523 ...... Alcohol/Drug Abuse or Dependence without Rehabilitation Therapy without Complication or Comorbidity ...... 0.88 * DRG 424—is an O.R. procedure code that must be billed with a principal diagnosis of mental disorder. ** DRG 433—is used when providers indicate a patient left against medical advice (discharge status code 07).

D. DRGs Not Recognized in the for admissions to IPFs, only one patient 607.84 (Impotence of an Organic Proposed IPF Prospective Payment was grouped in these DRGs. In addition, Origin), and code 608.89 (Male Genital System patients with these diagnoses generally Diseases, not elsewhere classified). In We are proposing not to recognize the do not require management in an IPF the 1999 MedPAR records for following 10 DRGs in the proposed IPF unless there is a concomitant admissions to IPFs, we were able to prospective payment system. They were psychiatric disorder. identify only one patient grouped in determined not to be clinically • DRGs 182, 183, and 184 include a DRG 352. significant because the principal range of gastrointestinal conditions, • DRGs 358, 359, and 369 include a diagnoses did not result in enough including esophagitis, gastroenteritis, range of cases in which procedures have and other digestive system diseases. The admissions to IPFs in order to establish been performed on the uterus and diagnoses in these DRGs include one an adjustment to the payment rate: fallopian tubes (Adnexa). These DRGs • that is listed in Chapter Five of the ICD– DRGs 34 and 35 include a range of include two diagnoses that are in cases for disorders of the nervous 9–CM, code 306.4 (Psychogenic GI Disease). In the 1999 MedPAR records Chapter Five of the ICD–9–CM: code system. The diagnoses in these DRGs 306.51 (Psychogenic Vaginismus), and also include five ICD–9–CM codes for for admissions to IPFs, we found that code 306.52 (Psychogenic DSM diagnoses: Codes 333.1 (Tremor only a few patients with this ICD–9–CM Dysmenorrhea). In the 1999 MedPAR not elsewhere classified), code 333.82 diagnosis were grouped in these DRGs. (Orofacial Dyskinesia), code 333.92 • DRG 352 includes a range of records for admissions to IPFs, we were (Neuroleptic Malignant Syndrome), diagnoses affecting the testes, prostate, able to identify only 11 patients grouped code 347 (Cataplexy and Narcolepsy), and male external genitalia. This DRG into DRGs 358, 359, and 369, and there and code 307.23 (Gilles de La Tourette’s includes DSM diagnoses that are not in were no patients diagnosed with codes Disorder). In the 1999 MedPAR records Chapter Five of the ICD–9–CM: code 306.51 or 306.52.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66926 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

• DRG 467 includes a range of cases paid under the proposed IPF account for interrupted stays. This in which other factors influence health prospective payment system: section includes a discussion of how the status. This DRG contains only one • Veterans Administration hospitals. proposed Federal per diem base rate diagnosis code listed in Chapter Five of • Hospitals that are reimbursed under was created, the factors that we the ICD–9–CM, code 305.1 (tobacco use State cost control systems approved considered to adjust the proposed disorder). Patients with this diagnosis under 42 CFR part 403. Federal per diem base rate, and how the • do not require inpatient treatment in an Hospitals that are reimbursed in proposed per diem payment amount is IPF unless there is a concomitant accordance with demonstration projects calculated. specified in section 402(a) of Pub. L. 90– psychiatric disorder. A. Proposed Market Basket We are proposing not to recognize 248 (42 U.S.C. 1395b–1) or section these 10 DRGs for payment adjustments 222(a) of Pub. L. 92–603 (42 U.S.C. We are proposing to use a 1997-based 1395b–1(note)). excluded hospital with capital market (34, 35, 182, 183, 184, 352, 358, 359, • 369, and 467) because they generally do Non-participating hospitals basket. We periodically revise and not include a psychiatric diagnosis. We furnishing emergency services to rebase the market basket to reflect more believe that failure to recognize these Medicare beneficiaries. current cost data. Rebasing means This proposed rule would not change DRGs will not affect the care of moving the base year for the structure of the basic criteria for a hospital or Medicare beneficiaries because our costs (in this case from 1992 to 1997), hospital unit to be classified as a analysis shows few, if any, of the while revising means changing data psychiatric hospital or psychiatric unit patients with these diagnoses are sources, cost categories, or price proxies that is excluded from the hospital admitted or treated in an IPF. used. The proposed updated market prospective payment systems under basket would replace the 1992-based In addition, we believe that these sections 1886(d) and 1886(g) of the Act, excluded hospital with capital market cases would be classified into one of the nor would it revise the survey and basket. This rebased (1997-base year) selected DRGs and grouped with other certification procedures applicable to and revised market basket would be beneficiaries with similar symptoms entities seeking this classification. used to update FY 1999 IPF costs to the and requiring similar care. This We note that we are proposing a proposed 15-month period beginning approach would avoid creating case-mix technical change to § 412.27(a). We are April 1, 2004, the first year under the groups based on small numbers of cases. proposing to replace the Third Edition IPF prospective payment system. We believe there is value in selecting with the Fourth Edition, Text Revision, The operating portion of the 1997- only those DRGs that contain a large of the DSM so that our rules reflect the based excluded hospital with capital enough number of psychiatric cases to most current edition of the DSM. market basket is derived from the 1997- ensure that individual variability can be As noted previously, we are based excluded hospital market basket. averaged. We specifically invite public requesting public comments on The methodology used to develop the comments on this issue. continuing to require a DSM diagnosis operating portion was described in the E. Applicability of the Proposed IPF for patients admitted to a psychiatric hospital inpatient prospective payment Prospective Payment System unit in light of the proposed system final rule published in the requirement that IPFs use the ICD–9– Federal Register on August 1, 2002 (67 The following psychiatric hospitals CM code set in the proposed IPF FR 50042 through 50044). In brief, the and psychiatric units, currently paid prospective payment system. operating cost category weights in the under section 1886(b) of the Act, would 1997-based excluded hospital market be paid under the proposed IPF III. Development of the Proposed IPF basket were determined from the prospective payment system for cost Per Diem Payment Amount Medicare cost reports, the 1997 reporting periods beginning on or after The primary goal in developing the Business Expenditure Survey, and the April 1, 2004. We are proposing that the proposed IPF prospective payment 1997 Annual Input-Output data from IPF prospective payment system would system is to pay each IPF an appropriate the Bureau of the Census. As explained apply to inpatient hospital services amount for the efficient delivery of care in that August 1, 2002 final rule, we furnished by Medicare participating to Medicare beneficiaries. The system revised the market basket by making entities that are classified as psychiatric must be able to account adequately for two methodological revisions to the hospitals or psychiatric units as each IPF’s case-mix in order to ensure 1997-based excluded hospital market specified in § 412.22, § 412.23, § 412.25, both fair distribution of Medicare basket: (1) Changing the wage and and § 412.27. We note that psychiatric payments and access to adequate care benefit price proxies to use the units that are currently paid under the for those beneficiaries who require more Employment Cost Index (ECI) wage and hospital inpatient prospective payment costly care. benefit data for hospital workers; and (2) system and do not meet the The proposed IPF prospective adding a cost category for blood and requirements of § 412.25 and § 412.27 payment system would establish a blood products. would not be paid under the proposed standard per diem payment amount for When we add the weight for capital IPF prospective payment system. inpatient psychiatric services provided costs to the excluded hospital market As specified in § 400.200, the United to Medicare beneficiaries. The proposed basket, the sum of the operating and States means the fifty States, the District per diem amount would reflect the capital weights must still equal 100.0. of Columbia, the Commonwealth of average daily cost of inpatient Because capital costs account for 8.968 Puerto Rico, the Virgin Islands, Guam, psychiatric care in an IPF, including percent of total costs for excluded American Samoa, and the Northern capital-related costs. This proposed per hospitals in 1997, it holds that operating Mariana Islands. Therefore, IPFs located diem payment amount, after adjustment costs must account for 91.032 percent. within the United States would be for budget neutrality, is then modified Each operating cost category weight in subject to the proposed IPF prospective by factors for patient and facility the 1997-based excluded hospital payment system. However, the characteristics that account for variation market basket was multiplied by following hospitals are paid under in patient resource use. The proposed 0.91032 to determine its weight in the special payment provisions specified in IPF prospective payment system would 1997-based excluded hospital with § 412.22(c) and, therefore, would not be also include an outlier policy and capital market basket.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66927

The aggregate capital component of needed to be determined. The first set published in the Federal Register on the 1997-based excluded hospital of weights identifies the proportion of August 1, 2002 (67 FR 50045 through market basket (8.968 percent) was capital expenditures attributable to each 50047), for a discussion of how vintage determined from the same set of capital cost category, while the second weights are determined). Medicare cost reports used to derive the set represents relative vintage weights The cost categories, price proxies, and operating component. The detailed for depreciation and interest. The base-year FY 1992 and proposed FY capital cost categories of depreciation, vintage weights identify the proportion 1997 weights for the excluded hospital interest, and other capital expenses of capital expenditures that is with capital market basket are presented were also determined using the attributable to each year over the useful in Table 2 below. The vintage weights Medicare cost reports. Two sets of life of capital assets within a cost for the proposed 1997-based excluded weights for the capital portion of the category (see the hospital inpatient hospital with capital market basket is revised and rebased market basket prospective payment final rule presented in Table 2(A) below.

TABLE 2.—PROPOSED EXCLUDED HOSPITAL WITH CAPITAL INPUT PRICE INDEX (FY 1992 AND PROPOSED FY 1997) STRUCTURE AND WEIGHTS

Proposed Cost category Price wage variable Weights (%) weights (%) base-year 1992 base-year 1997

TOTAL ...... 100.000 100.000 Compensation ...... 57.935 57.579 Wages and Salaries ...... ECI—Wages and Salaries, Civilian Hospital Workers ...... 47.417 47.355 Employee Benefits ...... ECI—Benefits, Civilian Hospital Workers to capture total costs (op- 10.519 10.244 erating and capital), In order to capture total costs (operating and capital), HCFA Occupational Benefit Proxy. Professional fees: Non-Medical ..... ECI—Compensation: Prof. & Technical ...... 1.908 4.423 Utilities ...... 1.524 1.180 Electricity ...... WPI—Commercial Electric Power ...... 0.916 0.726 Fuel Oil, Coal, etc...... WPI—Commercial Natural Gas ...... 0.365 0.248 Water and Sewerage ...... CPI–U—Water & Sewage ...... 0.243 0.206 Professional Liability Insurance ..... HCFA—Professional Liability Premiums ...... 0.983 0.733 All Other Products and Services ...... 28.571 27.117 All Other Products ...... 22.027 17.914 Pharmaceuticals ...... WPI—Prescription Drugs ...... 2.791 6.318 Food: Direct Purchase ...... WPI—Processed Foods ...... 2.155 1.122 Food: Contract Service ...... CPI–U—Food Away from Home ...... 0.998 1.043 Chemicals ...... WPI—Industrial Chemicals ...... 3.413 2.133 Blood and Blood Products ..... WPI—Blood and Derivatives ...... 0.748 Medical Instruments ...... WPI—Med. Inst. & Equipment ...... 2.868 1.795 Photographic Supplies ...... WPI—Photo Supplies ...... 0.364 0.167 Rubber and Plastics ...... WPI—Rubber & Plastic Products ...... 4.423 1.366 Paper Products ...... WPI—Convert. Paper and Paperboard ...... 1.984 1.110 Apparel ...... WPI—Apparel ...... 0.809 0.478 Machinery and Equipment ..... WPI—Machinery & Equipment ...... 0.193 0.852 Miscellaneous Products ...... WPI—Finished Goods excluding Food and Energy ...... 2.029 0.783 All Other Services ...... 6.544 9.203 Telephone ...... CPI–U—Telephone Services ...... 0.574 0.348 Postage ...... CPI–U—Postage ...... 0.268 0.702 All Other: Labor ...... ECI—Compensation: Service Workers ...... 4.945 4.453 All Other: Non-Labor Intensive CPI–U—All Items (Urban) ...... 0.757 3.700 Capital-Related Costs ...... 9.080 8.968 Depreciation ...... 5.611 5.586 Fixed Assets ...... Boeckh-Institutional Construction: 23 Year Useful Life ...... 3.570 3.503 Life Y_y_YYF e...... Movable Equipment ...... WPI—Machinery & Equipment: 11 Year Useful life ...... 2.041 2.083 Interest Costs ...... 3.212 2.682 Non-profit ...... Avg. Yield Municipal Bonds: 23 Year Useful Life ...... 2.730 2.280 For-profit ...... Avg. Yield AAA Bonds: 23 Year Useful Life ...... 0.482 0.402 Other Capital Related Costs .. CPI–U—Residential Rent ...... 0.257 0.699 Note: The operating cost category weights in the proposed excluded hospital market basket add to 100.0. When we add an additional set of cost category weights (total capital weight = 8.968 percent) to this original group, the sum of the weights in the new index must still add to 100.0. Because capital costs account for 8.968 percent of the market basket, then operating costs account for 91.032 percent. Each weight in the pro- posed 1997-based excluded hospital market basket was multiplied by 0.91032 to determine its weight in the proposed 1997-based excluded hos- pital with capital market basket. Note: Weights may not sum to 100.0 due to rounding.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66928 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

TABLE 2(A).—PROPOSED EXCLUDED TABLE 2(B).—PERCENT CHANGES IN basket with IPF weights for wages, HOSPITAL WITH CAPITAL INPUT THE 1992-BASED AND PROPOSED pharmaceuticals, and capital (3.5 PRICE INDEX (FY 1997) VINTAGE 1997-BASED EXCLUDED HOSPITAL percent). This difference is less than the WEIGHTS WITH CAPITAL MARKET BASKETS, 0.25 percentage point criterion that determines whether a forecast error FYS 1999 THROUGH 2004—Contin- Year Interest: adjustment is warranted under the Fixed as- Movable ued hospital inpatient prospective payment from far- sets assets capital-re- thest to lated system update framework. most re- (23-year (11-year (23-year Percent weights) weights) Percent change, Based upon this analysis, we believe cent weights) change, that the excluded hospital with capital Fiscal year 1992-based proposed 1 ...... 0.018 0.063 0.007 market bas- 1997-based market basket is doing an adequate job market bas- of reflecting the price changes facing 2 ...... 0.021 0.068 0.009 ket ket 3 ...... 0.023 0.074 0.011 IPFs. We will continue to solicit 4 ...... 0.025 0.080 0.012 2000 ...... 3.4 3.1 comments about issues particular to 5 ...... 0.026 0.085 0.014 2001 ...... 3.9 4.0 IPFs that should be considered in our 6 ...... 0.028 0.091 0.016 Average development of the proposed 1997- 7 ...... 0.030 0.096 0.019 historical: 3.2 3.3 based excluded hospital with capital 8 ...... 0.032 0.101 0.022 2002 ...... 2.7 3.6 market basket, as well as encourage 9 ...... 0.035 0.108 0.026 2003 ...... 3.0 3.5 suggestions for additional data sources 10 ...... 0.039 0.114 0.030 2004 ...... 3.0 3.3 11 ...... 0.042 0.119 0.035 that may be available. Our hope is that Average the additional cost data being collected 12 ...... 0.044 ...... 0.039 forecast: 2.9 3.5 13 ...... 0.047 ...... 0.045 under the proposed IPF prospective 14 ...... 0.049 ...... 0.049 Source: Global Insights, Inc, 4th Qtr payment system will eventually allow 15 ...... 0.051 ...... 0.053 2002,@USMARCO.MODTREND@CISSIM/ for the development of a market basket 16 ...... 0.053 ...... 0.059 TL1102.SIM. Historical data through 3rd Qtr 2002. based primarily on IPF data. We 17 ...... 0.057 ...... 0.065 welcome comments on issues particular 18 ...... 0.060 ...... 0.072 Based upon the analysis mentioned to IPFs that should be considered in our 19 ...... 0.062 ...... 0.077 below, we believe the excluded hospital use of the proposed 1997-based 20 ...... 0.063 ...... 0.081 with capital market basket provides a 21 ...... 0.065 ...... 0.085 excluded hospital with capital market 22 ...... 0.064 ...... 0.087 reasonable measure of the price changes basket, as well as on suggestions for 23 ...... 0.065 ...... 0.090 facing IPFs. However, we have also been additional data sources that may be researching the feasibility of developing readily available on the cost structure of Total 1.0000 1.0000 1.0000 a market basket specific to IPF services. IPFs. This research includes analyzing data As discussed more fully in section IV NOTE: Weights may not sum to 1.000 due to rounding. sources for cost category weights, of this proposed rule, we are proposing specifically the Medicare cost reports, to implement the proposed IPF Table 2(B) below compares the 1992- and investigating other data sources on prospective payment system for IPF cost based excluded hospital with capital cost, expenditure, and price information reporting periods that begin on or after market basket to the proposed 1997- specific to IPFs. April 1, 2004. The first update, based excluded hospital with capital Our analysis of the Medicare cost however, would not be until July 1, market basket. As shown below, the reports indicates that the distribution of 2005. This extends the first year for 3 rebased and revised market basket costs among major cost report categories additional months in order to adjust the grows slightly faster over the 1999 (wages, pharmaceuticals, and capital) update cycle for this proposed payment through 2001 period than the 1992- for IPFs is not substantially different system. As a result, the effective period based market basket. The main reason from the 1997-based excluded hospital for this proposed rule is April 1, 2004 for this growth is the switching of the with capital market basket we propose through June 30, 2005. To update wage and benefit proxy to the ECI for to use. In addition, the only data payments between FY 2003 and the hospital workers from the previous available to us for these cost categories effective period, the update must reflect occupational blend. This revision had a (wages, pharmaceuticals, and capital) the market basket increase over this similar impact on the hospital inpatient presented a potential problem since no period, which is currently estimated at prospective payment system and other major cost category weights would 5.3 percent. This would represent the excluded hospital market baskets, as be based on IPF data. Based on the proposed increase in the excluded described in the final rule published in research discussed below, at this time, hospital with capital market basket for the Federal Register on August 1, 2002 we are not proposing to develop a FY 2004 and the first 9 months of FY (67 FR 50032 through 50041). market basket specific to IPF services. 2005. We conducted an analysis of annual TABLE 2(B).—PERCENT CHANGES IN percent changes in the market basket B. Development of the Proposed Case- THE 1992-BASED AND PROPOSED when the weights for wages, Mix Adjustment Regression 1997-BASED EXCLUDED HOSPITAL pharmaceuticals, and capital in IPFs In order to ensure that the proposed WITH CAPITAL MARKET BASKETS, were substituted into the excluded IPF prospective payment system would FYS 1999 THROUGH 2004 hospital with capital market basket. be able to account adequately for each Other cost categories were recalibrated IPF’s case-mix, we performed an using ratios available from the hospital extensive regression analysis of the Percent Percent change, change, inpatient prospective payment system relationship between the per diem costs proposed hospital market basket. On average, and both patient and facility Fiscal year 1992-based 1997-based market bas- market bas- between 1995 and 2002, the excluded characteristics to determine those ket ket hospital with capital market basket characteristics associated with increased at nearly the same average statistically significant cost differences. 1999 ...... 2.3 2.7 annual rate (3.4 percent) as the market For characteristics with statistically

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66929

significant cost differences, we used the of routine cost only to the extent that systematically exclude a larger regression coefficients of those variables facilities tend on average to treat proportion of cases from the higher cost to determine the size of the different proportions of patients with psychiatric units. Before calculating the corresponding payment adjustments. differing routine resource needs. For means of the logged per diem total cost, Based on the regression analysis, we are example, one IPF may have higher we trimmed cases from the file when proposing to adjust the per diem routine per diem costs because it treats covered days were zero, or routine costs payment for differences in the patient’s a higher proportion of older patients (or were less than $100 or greater than DRG, age, comorbidities, and the day of patients who require continuous $3,000, (because we believe this range the stay. Also, we are proposing monitoring) than another IPF. However, captured the grossly aberrant cases), so adjustments for area wage levels, rural our cost variable will not measure the that the means would not be distorted. IPFs, and teaching IPFs. extent to which older patients within We trimmed cases when the logged per We computed a per diem cost for each the same IPF are more costly than diem cost was outside the standard and Medicare inpatient psychiatric stay, younger patients. We are currently generally used statistical trim points of including routine operating, ancillary, conducting a research study with the plus or minus 3 standard deviations and capital components using RTI International (trade name of from the respective means for hospitals information from the 1999 MedPAR file Research Triangle Institute) that will and psychiatric units. These criteria and data from the 1999 Medicare cost provide information as to the effects of eliminated another 3,347 cases, leaving reports. The method described below this data limitation. As a result, we 467,372 cases that were used in the final that was used to construct the proposed expect to have more information about regression. per diem cost for IPFs is a standard the extent to which routine costs vary The log of per diem cost, like most method that has been used to construct by certain patient characteristics. We health care cost measures, appears to be a Medicare cost per discharge for solicit suggestions on other data sets or normally distributed. Therefore, the inpatient acute care (Newhouse, J.P., S. studies that could provide additional natural logarithm of the per diem cost Cretin, and C. Witsberger. Predicting information on the relationship between was the dependent variable in the Hospital Accounting Costs, Health Care individual patients and average facility regression analysis. To control for Financing Review, V.11, No. 1. Fall routine costs. psychiatric hospitals that do not bill 1989). We believe that this method This routine cost limitation does not ancillary costs, we included a provides a full account of IPF’s per diem apply to ancillary costs because they categorical variable that identified them. costs. can be measured at the patient level The proposed per diem cost was To calculate the cost per day for each using Medicare claims as reported in the adjusted for differences in labor cost inpatient psychiatric stay, routine costs MedPAR file. However, there are across geographic areas using the FY were estimated by multiplying the differences in charging practices 1999 hospital wage index unadjusted for routine cost per day from the IPF’s 1999 between psychiatric hospitals and geographic reclassifications, in order to Medicare cost report by the number of psychiatric units that affect our be consistent with our use of the market Medicare covered days on the 1999 measurement of ancillary costs. For basket labor share in applying the wage MedPAR stay record. Ancillary costs example, there are approximately 100 index adjustment. were estimated by multiplying each hospitals in our MedPAR data file that We computed a proposed wage departmental cost-to-charge ratio by the do not bill ancillary charges; the adjustment factor for each case by corresponding ancillary charges on the majority of these providers are State multiplying the Medicare hospital wage MedPAR stay record. The total cost per psychiatric hospitals who bill a single index for each facility by the proposed day was calculated by summing routine average per diem rate that includes labor-related share (.72828) and adding and ancillary costs for the stay and routine, ancillary, and other costs. the proposed non-labor share (.27172). dividing it by the number of Medicare The proposed payment adjustors were We used the proposed excluded covered days for each day of the stay. derived from regression analysis of 100 hospital with capital market basket to We used the best available data and percent of the 1999 MedPAR data file. determine the labor-related share (see methods for this proposed IPF The MedPAR data file used for the final section III.A. of this proposed rule). The prospective payment system. However, regression contains 467,372 cases per diem cost for each case was divided the data are potentially limited for the although the complete file contains by this factor before taking the natural purpose of determining the extent to 476,541 cases. We deleted 5,822 cases logarithm (that is, a standard which differences in patient (1.24 percent) from this file because mathematical practice accepted by the characteristics influence the per diem routine cost data for certain IPFs was scientific community). The payment cost of inpatient psychiatric care. not available. In order to include as adjustment for the wage index was This potential limitation results from many IPFs as possible in the regression, computed consistently with the wage Medicare cost accounting practices in we substituted the 1998 Medicare cost adjustment factor, which is equivalent which routine per diem costs are report data for routine cost and ancillary to separating the per diem cost into a calculated as an average and, therefore, cost to charge ratios (using the 1998 labor portion and a non-labor portion do not vary among patients within a Medicare cost report data). and adjusting the labor portion by the facility (that is, a patient requiring For the remaining 470,719 cases, we wage index. intensive staff attention is assigned the used the following method to trim With the exception of the proposed same routine cost as a patient requiring extraordinarily high or low cost values payment adjustment for teaching little staff attention). This potential that most likely contained data errors, in facilities, the independent variables limitation assumes heightened order to improve the accuracy of our were specified as one or more importance for IPFs because routine results. The means and standard categorical variables. Once the costs represent about 88 percent of total deviations of the logged per diem total regression model was finalized based on costs. As a result, our cost measure may cost were computed separately for cases the log normal variables, the regression not capture the degree of variation in from psychiatric hospitals and coefficients for these variables were routine cost attributable to differences psychiatric units. Separate statistics converted to payment adjustment in patient characteristics. Patient were computed for the groups of IPFs, factors by treating each coefficient as an differences are reflected in our measure because we did not want to exponent of the base e for natural

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66930 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

logarithms, which is approximately • DRG 023 (Non-traumatic stupor and provides a listing of the proposed equal to 2.718. The proposed payment coma) would receive an adjustment of comorbidity categories, the ICD–9–CM adjustment factors represent the approximately 1.10. diagnostic codes comprising each proportional effect of each variable • DRG 425 (Acute Adjustment category, and the payment adjustment relative to a reference variable. Reaction and Psychosocial factors. The adjustment factors are also Dysfunction) would receive an in Addendum A. 1. Proposed Patient-Level adjustment of approximately 1.08. Characteristics • DRG 12 (Degenerative Nervous As in the case of the DRGs, the cost System Disorders) would receive an regression analysis was used to Subject to the limitations of the adjustment of approximately 1.07. determine the magnitude of the proposed cost variable described above Both of the following two DRGs proposed payment adjustments for the and the availability of patient would be paid substantially less than comorbidity groups. Of the 17 characteristic information contained in DRG 430 with payment adjustments of comorbidity categories, the following 4 the administrative data, we attempted to approximately 0.88: groups would have proposed payment use patient characteristics to explain the • DRG 433 (Alcohol/Drug Abuse or adjustment factors ranging from 1.11 to cost variation amongst IPFs. By Dependence, left against medical 1.17 more than a case that did not have adjusting for DRGs, comorbidities, age, advice). any of the 17 comorbid conditions: (1) • and day of the stay, we were able to DRG 523 (Alcohol/Drug Abuse or Coagulation factor deficits; (2) renal explain approximately 19 percent of the Dependence, without Complications failure, chronic; (3) chronic cardiac variation in the per diem cost. This and/or Comorbidity and without conditions; and (4) atherosclerosis of result is comparable to that obtained by Rehabilitation Therapy). extremity with gangrene. Seven Cases in our MedPAR data file whose THEORI in the analysis they conducted categories would be paid payment principal diagnosis classified them in for the APA. The study is described in adjustments from 1.08 to 1.14: (1) DRGs other than one of the 15 DRGs that section II.B. of this proposed rule. Tracheotomy; (2) renal failure, acute; (3) we are proposing to recognize in this malignant neoplasms; (4) severe protein a. DRGs proposed IPF prospective payment calorie malnutrition; (5) chronic system were grouped into a single obstructive pulmonary disease; (6) The principal diagnosis ICD code ‘‘other’’ category. poisoning; and (7) severe listed on the claim is used to assign musculoskeletal and connective tissue each case to one of the 15 DRGs that we b. Comorbidities diseases. The remaining 6 comorbidity are proposing to recognize in this IPF Our analysis of the data indicates that patients who have certain comorbid categories would receive payment prospective payment system (see section adjustments ranging from 1.03 to 1.10: II.C of this proposed rule). The conditions in addition to their psychiatric condition generally require (1) HIV; (2) infectious diseases; (3) coefficients of these DRGs from the cost uncontrolled type I diabetes mellitus; regression analysis were used to more expensive care while they are hospitalized. After a thorough review of (4) artificial openings digestive and determine the magnitude of the urinary; (5) drug and/or alcohol induced payment adjustment for each of the the ICD–9–CM codes, some comorbid conditions were identified as being mental disorders; and (6) eating and proposed 15 DRGs. The payment conduct disorders. adjustments are expressed relative to the more costly on a per diem basis. Groups most frequently assigned DRG (DRG of similar diagnosis codes were created Other potential conditions were 430, Psychoses). That is, the proposed to describe these conditions, which tend considered as potentially more adjustment factor for DRG 430 would be to be chronic illnesses that require expensive, but the small number of cases in the MedPAR data file made it 1.00, and the proposed adjustment additional medications, supplies, impossible to propose an appropriate factors for the other 14 DRGs would laboratory, or diagnostic testing in adjustment for those conditions. We vary above and below 1.00. For 8 DRGs, addition to the care provided for their solicit comments suggesting other the proposed adjustments would be psychiatric condition. Conditions in which the patient is acutely ill requiring conditions that may be expected to relatively small (between .96 and 1.04, care in a general hospital, for example, increase the per diem cost of care in that is, between 4 percent lower to 4 myocardial infarction, were not IPFs. In addition, we expect that as percent higher). The following 4 DRGs included in our analysis. facilities become aware of the would receive relatively large payment Based upon this analysis, we are importance of providing accurate adjustments: proposing payment adjustments for 17 information on the diagnoses of • DRG 424 (Surgical procedure with comorbidity categories that we would patients, we will have more data to use Principal Diagnosis of Mental Illness) recognize for payment adjustments as a basis for refinements to the list of would have the largest payment under the proposed IPF prospective proposed comorbid conditions affecting adjustment of approximately 1.22. payment system. Table 3 below the per diem cost of care.

TABLE 3.—DIAGNOSIS CODES FOR PROPOSED COMORBIDITY CATEGORIES

Proposed Description of proposed comorbidity ICD–9–CM code adjustment factor

HIV ...... 042 ...... 1.06 Coagulation Factor Deficits ...... 2860 through 2864 ...... 1.11 Tracheotomy ...... 51900 and V440 ...... 1.14 Renal Failure, Acute ...... 5846 through 5849; 7885; 9585; V451; V560, V561; and V562 1.08 Renal Failure, Chronic ...... 40301; 40311; 40391; 40402; 40412; 40492, 585; and 586 ..... 1.14 Malignant Neoplasms ...... 1400 through 1720; 1740 through 1840; and 1850 through 1.10 2080.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66931

TABLE 3.—DIAGNOSIS CODES FOR PROPOSED COMORBIDITY CATEGORIES—Continued

Proposed Description of proposed comorbidity ICD–9–CM code adjustment factor

Uncontrolled Type I Diabetes-Mellitus, with or without com- 25003; 25083; 25013; 25023; 25033; 25093; 25043; 25053; 1.10 plications. 25063; and 25073. Severe Protein Calorie Malnutrition ...... 260 through 262 ...... 1.12 Eating and Conduct Disorders ...... 3071; 30750; 31203; 31233; and 31234 ...... 1.03 Infectious Diseases ...... 01000 through 04110; 04500 through 05319, 05440 through 1.08 05449; 0550 through 0770; 0782 through 0789; and 07950 through 07595. Drug and/or Alcohol Induced Mental Disorders ...... 2920; 2922; 2910; 29212; 30300; and 30400 ...... 1.03 Cardiac Conditions ...... 3910; 3911; 3912; 40201; 41403; 4160; and 4210 ...... 1.13 Atherosclerosis of Extremity with Gangrene ...... 44024 ...... 1.17 Chronic Obstructive Pulmonary Disease ...... 5100; 51883; 51884; 4920; 494; 49120 through 49122, and 1.12 V461. Artificial Openings-Digestive and Urinary ...... 56960; V441 through V443; and V4450 ...... 1.09 Severe Musculoskeletal and Connective Tissue Diseases...... 6960; 7100; 73000 through73009; 73010 through 73019; 1.12 73020 through 73029; and 7854. Poisoning ...... 96500 through 96509; and 9654; 9670 through 9700; 9800 1.14 through 9809; 9830 through 9839; 986; 9890 through 9897.

c. Patient Age and Gender detail in section V.C.1. of this proposed identify a direct link between the costs The cost regressions explored several rule. of psychiatric care in psychiatric units alternative configurations of age and The cost regression implies that and treatment of female IPF patients. gender variables. The results indicate female patients are approximately 3 We are not proposing to adjust the per that the per diem cost rises as a patient’s percent more costly than male patients. diem payment rate to account for age increases, and the per diem cost are However, the explanatory power of the gender. We invite comments on the higher for female patients. equation increases by less than .002 appropriateness of including a gender We examined the variation in the per percentage points. There is also a small variable as a payment adjustment as diem cost for 5-year age intervals reduction in the age effect for the 65 and well as comments on the age categories ranging from age 40 to 80 with open- over age group (less than one percentage used to identify variations in costs. We ended categories ranging above age 80 point). We also examined the alternative will continue to assess the effects of and below 40 and determined that the of including gender along with the three gender and age as we analyze more effect of age was statistically significant. age groups (under 55, 55 to 64, and 65 current data in the development of the We initially ran the regression for three and over) and compared the results to final rule. age groups consistent with the natural the regression without gender and with breaks in the distribution of age (under two age groups (under 65 and 65 and d. Length of Stay over). The fuller specification of age and 55, 55 to 64, and 65 and over). The Cost regressions indicate that the per gender only increased the explanatory distribution showed that most Medicare diem cost declines as the length of stay power by .003 points and had little psychiatric patients are under age 55 increases. We are proposing adjustments effect on the size of the age effects. and over age 65. In addition, the to account for ancillary and certain distribution showed that the age group We know that the elderly and women administrative costs that occur between 55 and 65 years of age are more frequently treated in disproportionately in the first days after increased the predictive power of the psychiatric units than in freestanding being admitted to an IPF (the variable model only by a factor of .002 percent psychiatric hospitals. When an indicator per diem adjustments). We examined because there were few patients in that variable for psychiatric units is included the per diem cost over a range of 1 to age category. For this reason, we are not in the cost regression, the age and 14 days. According to the 1999 MedPAR proposing adjustments reflecting the gender effects decrease (the 65 and over data file, the per diem costs were three age groups. Rather, we are age effect declines from approximately highest on day 1 and declined for days proposing to make a single adjustment 13 percent to approximately 9 percent, 2 through 8 as indicated below. Per of 13 percent for patients 65 years and and the gender effect decreases from diem costs for days 9 and thereafter over. We are proposing two age groups approximately 3 percent to 2 percent). (under 65 and over 65) to correspond We are unable to determine the extent remained relatively consistent with the with the major populations within to which this interaction of psychiatric median length of stay in an IPF for Medicare: the disabled and the elderly, unit status with age and gender Medicare beneficiaries. The cost which we believe are largely responsible indicates higher direct costs of treating regression analysis was used to for the age-related cost differences that the elderly and women, as opposed to determine the following proposed we observed. In addition, preliminary other reasons for the higher costs of payment adjustments. Relative to a stay results from the RTI International psychiatric units. However, RTI of 9 or more days, the resulting research that used estimates of patient- International’s preliminary results, adjustments for the first 8 days of a stay specific routine cost per day (from a which used a better patient-specific cost that we are proposing to use in this IPF sample of 40 IPFs) found that splitting variable for a sample of 40 hospitals prospective payment system are as age into two groups (under 65 and over found a much stronger effect for age follows: 65) has greater explanatory power than than for gender. This is because the • The variable per diem adjustment alternative age group configurations. evidence currently available to us is for day 1 would be an increase of The research study is described in more limited and we believe we cannot approximately 26 percent.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66932 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

• The variable per diem adjustment minimum levels of fixed costs that by adopting caps for both direct and for days 2 to 4 would be an increase of cannot be avoided. Based on this indirect teaching payments. The number approximately 12 percent. analysis, we are proposing to make an of residents was capped for the purpose • The variable per diem adjustment adjustment of 16 percent for IPFs of computing both the direct and for days 5 to 8 would be an increase of located in rural areas. indirect teaching adjustments and the approximately 5 percent. resident to ADC was capped for b. Teaching Status • No variable per diem adjustment purposes of computing the indirect would be paid after the 8th day. One option for paying psychiatric teaching adjustment. Because IPFs The higher payments for earlier days teaching facilities for their higher costs would now be paid on a prospective are offset through the budget neutrality relies on past experience with the basis similar to acute care hospitals, we adjustment, which has the effect of teaching adjustment for other Medicare are considering extending the indirect lowering the average payment to prospective payment systems. As in teaching caps to IPF teaching hospitals. account for the increased payments. other inpatient prospective payment Regulations, as specified at § 413.86, systems, we measured teaching status as already apply the BBA caps to direct 2. Proposed Facility-Level one plus the ratio of the number of Characteristics medical education payments for all interns and residents assigned to the teaching hospitals. As noted earlier, we were able to facility divided by the IPF’s average We are also exploring whether there explain 19 percent of the variation in daily census (ADC). Similarly for are other alternatives for paying IPF wage-adjusted per diem cost using psychiatric units, we used the number teaching hospitals their higher teaching patient characteristics. We explored a of interns and residents assigned to the costs. We are interested in developing variety of ways to incorporate facility psychiatric unit. methodologies for estimating these characteristics into the cost regressions The advantages of using the ADC higher costs and then, based on the in order to raise the explanatory power rather than the number of beds for the newly available estimates and current and refine the proposed payment system denominator of the ratio noted above data, distributing those costs fairly to to better align payments with cost was discussed in the final rule we individual teaching hospitals. We invite differences across facility types. published in the Federal Register on comments on obtaining the estimates Per diem costs are strongly related to , 1991 (56 FR 43380) for and current data and on other facility occupancy, because occupancy putting inpatient hospital capital approaches to paying psychiatric (as measured by the ratio of actual days payments under a prospective payment. teaching hospitals for their higher to available days) measures the extent to As described in that rule, the two key medical-education costs based on that which the facility is efficiently utilizing advantages of the ADC are that it is—(1) data. its capacity. When occupancy is low, easier to define more precisely than fixed costs must be spread across number of beds; and (2) less subject to c. Disproportionate Share Hospital relatively few days of care and the per understatement in an effort to increase Status diem costs are high. Because we do not the size of the teaching variable. We We measured the extent to which a want to pay for inefficiency, we are not believe that these advantages apply facility provides care to low income proposing that occupancy be used as a equally to IPFs. patients using the disproportionate payment adjuster. However, this The teaching variable in our cost share hospital (DSH) variable used in variable is included in the cost regressions, that is, the logarithm of one other Medicare prospective payment regression to improve the estimates of plus the ratio of interns and residents to systems (that is, the sum of the the effects of other factors that may ADC, has a coefficient value of .5215. proportion of Medicare days of care more appropriately be used to adjust This cost effect is converted to a provided to recipients of Supplemental payments. payment adjustment by treating the Security Income and the proportion of An analysis of the facility-level regression coefficient as an exponent the total days of care provided to characteristics we considered follows. and raising the teaching variable to the Medicaid beneficiaries). For psychiatric To summarize the analysis, we are .5215 power. Applying this method for units, both proportions are specific to proposing that payments be adjusted a facility with a teaching variable of 1.10 the unit and not the entire hospital. A based on the IPF’s wage index, rural would yield a 5.1 percent increase in limitation of the Medicaid proportion as location, and teaching status. We the per diem payment; for a facility with applied to psychiatric hospitals is that considered, and explain below, the a teaching variable of 1.25, there would Medicaid does not pay for services reasons why we are proposing not to be a 12.3 percent higher payment. provided to individuals under the age of provide adjustments for psychiatric Our impact tables are based on the 65 in an institution for mental diseases units, disproportionate share intensity, assumption that we would pay a (IMD), as specified in section 1905(h) of or IPFs in Alaska or Hawaii. proposed IPF teaching adjustment in the Act. As a result, low-income this manner and our proposed beneficiaries in IMDs cannot be a. Rural Location regulatory text is also based on this identified as Medicaid beneficiaries, We found that, controlling for the approach. However, we are considering and the Medicaid proportion will be patient characteristics and other facility alternatives because we are concerned biased downwards. variables included in our cost that this method creates incentives for The DSH variable was highly regression, facilities located in non- teaching hospitals to add residents and significant in our cost regressions; metropolitan area counties had per diem to increase their payments under an however, we found that facilities with costs about 16 percent higher than open-ended formula that pays higher higher DSH had lower per diem costs. facilities located in metropolitan area teaching payments as teaching intensity, We note that the previously cited study counties. Most of the higher cost of rural as measured by resident to ADC ratios, for the APA also found the same results. IPFs is related to the fact that the vast increases. The relationship of high DSH with majority are psychiatric units within The BBA, sections 4621 and 4623, lower costs cannot be attributed to small general acute care hospitals. limited the incentives to add residents downward bias in the Medicaid Small-scale facilities are more costly on in hospitals paid under the hospital proportion due to the IMD exclusion. a per diem basis because there are inpatient prospective payment system This is because public psychiatric

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66933

hospitals already have lower costs on e. Adjustment for Alaska and Hawaii and to reduce the incentives to under average than other types of IPFs. IPFs serve these patients. Therefore, if we propose a DSH Some of the prospective payment Therefore, in order to protect IPFs adjustment based on the regression systems that have been developed from significant ‘‘losses’’ on very costly analysis, IPFs with high DSH shares include a cost-of-living adjustment for cases, we are proposing to provide would be paid lower per diem rates. the unique circumstances of Medicare outlier payments and set outlier We tried a variety of supplemental providers located in Alaska and Hawaii. numerical criteria prospectively so that analyses in an attempt to better Therefore, we analyzed our data to outlier payments are projected to equal understand the observed relationship, determine the existence of IPFs located 2 percent of total payments under the but did not find a positive relationship in Alaska and Hawaii. Currently, in proposed IPF prospective payment between the per diem cost and the DSH Alaska, there are only two psychiatric system. Based on the regression analysis ratio. Therefore, we are not proposing a hospitals and no psychiatric units. In and payment simulations, we believe payment adjustment for DSH intensity Hawaii, there is one psychiatric hospital that using a 2 percent threshold but will monitor the effect of DSH for and one psychiatric unit. In the absence optimizes our ability to protect possible future adjustments. of a cost-of-living adjustment, our vulnerable IPFs while providing adequate payment for all other cases d. Psychiatric Units in General Acute analyses indicates that some facilities in Alaska and Hawaii would ‘‘profit’’ and that are not outlier cases. Care Hospitals We are proposing, in § 412.424(c), to other facilities would experience a On average, psychiatric units have make an outlier payment for any case in ‘‘loss.’’ Due to the limited number of higher per diem costs than psychiatric which the estimated total cost exceeds cases, the results of our analysis are hospitals. According to the 1999 an outlier threshold amount equal to the inconclusive regarding whether a cost- MedPAR file, the average per diem cost total IPF prospective payment system of-living adjustment would improve for psychiatric units was $615, payment amount plus a fixed dollar loss compared to $444 for psychiatric payment equity for these facilities. amount. The fixed dollar loss amount is hospitals. Therefore, we are not proposing an the amount used to limit the loss that an Some of the patient characteristics adjustment for IPFs located in Alaska IPF would incur under the proposed and facility variables that we included and Hawaii. We will continue to assess outlier policy (see section III.C.3. of this in our cost regressions explain part, but the impact of the proposed IPF proposed rule for an explanation of how not all, of the cost difference between prospective payment system on IPFs the fixed dollar loss amount is hospitals and psychiatric units. located in Alaska and Hawaii as we calculated). Once the cost of a case Controlling for facility size, occupancy, obtain more current data. exceeds the outlier threshold amount, and selected comorbidities reduces the 3. Proposed Payment Adjustments an outlier payment would be made. A magnitude of the estimated cost basic principle of an outlier policy is a. Proposed Outlier Adjustment difference from approximately 37 that outlier payments should cover less percent to 19 percent. Several factors While we are not statutorily required than the full amount of the additional may account for the remaining 19 to provide outlier payments, we believe costs above the outlier threshold in percent difference: (1) A large that it is appropriate to propose an order to preserve the incentive to proportion of psychiatric admissions to outlier payment policy in connection contain costs once a case qualifies for these units enter the hospital through with this prospective payment system in outlier payments (see Emmett B. Keeler, the emergency room (ER), and ER order to both ensure that IPFs treating Grace M. Carter, and Sally Trude, charges are included on the inpatient unusually costly cases do not incur ‘‘Insurance Aspects of DRG Outlier claims used in our analysis (this issue substantial ‘‘losses’’ and promote access Payments,’’ The Rand Corporation, N– will not be relevant to IPF payment in to IPFs for patients requiring expensive 2762–HHS, October 1988). This results the future because ER services have care. Providing additional payments for in Medicare and the IPF sharing been paid under the outpatient hospital costs that are beyond the IPF’s control financial risk in the treatment of prospective payment system since can strongly improve the accuracy of the extraordinarily costly cases. August 2000); (2) some of these proposed IPF prospective payment b. Methodology for Proposed Outlier admissions have medical conditions in system in determining resource costs at Payments addition to psychiatric symptoms and the patient and facility level. require more treatments resulting in Notwithstanding the factors that we We are proposing to make outlier higher costs due to more services and are proposing to recognize in the IPF payments on a per case basis rather than equipment; (3) psychiatric hospitals and prospective payment system as on a per diem basis. Outlier payments psychiatric units may utilize different proposed adjustments to the per diem would be made for IPF cases when the patterns of care and staffing; and (4) payment rate, the cost of care for some estimated cost of the entire stay exceeds accounting differences may account for psychiatric patients may still the outlier threshold amount. We some of the cost difference. substantially exceed the otherwise believe it is appropriate to determine We have decided not to propose a applicable payments during the course outlier status on a per case basis in specific adjustment for psychiatric of a stay. This may occur because of order to accurately assess the ‘‘losses’’ units. We are concerned about applying multiple comorbid conditions and associated with the care of a patient for such an adjustment to all psychiatric complications that require a high the entire stay. If we propose to units regardless of an individual unit’s utilization of ancillary services. Since establish a per diem fixed dollar loss costs, efficiency, or case mix. this is a per diem payment system, the threshold, outlier payments could occur We hope that with further research, extent to which length of stay is a factor for part of an inpatient stay when no we will be able to gain a better would be mitigated because payment is ‘‘losses’’ actually occur. If we review the understanding of the cost differences made for each day of the stay. stay in terms of the resources expended that would enable us to propose even We have determined that it is each day, the facility may incur a ‘‘loss’’ more refined payment adjustments to important to provide some protection on some days of the stay and may directly measure the differences in from financial risk caused by treating experience ‘‘gains’’ on other days of the patient care needs in psychiatric units. patients who require more costly care stay. Thus, assessing the resources

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66934 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

expanded over the course of the entire outlier payments, with an average amount under the proposed IPF stay provides a fuller picture of the payment of $2,125 per case. Although a prospective payment system is highest actual resources needed to provide care 3 percent outlier policy reduced the on days 1 through 4, declines on days for the complete episode of care. After number of cases that would qualify for 5 through 8, and declines further for all assessing the entire stay, one can outlier payments, 12 percent of cases days beyond 8. Similarly, we are determine if a ‘‘loss’’ was actually still exceeded our target of 10 percent of proposing to establish an 80-percent incurred by the IPF. total IPF cases. loss-sharing ratio for days 1 through 8 Therefore, we are proposing to define However, we have determined that an in order to reflect higher costs early in the outlier threshold amount as the total outlier policy of 2 percent of the total an IPF stay and reduce the ratio by 20 IPF prospective payment for an IPF stay, proposed IPF payments would allow us percent for days 9 and thereafter. This plus a fixed dollar loss amount. As to achieve a balance of the above stated is consistent with the median length of explained below, the fixed dollar goals. A 2 percent outlier policy would stay for IPFs. Reducing the amount amount is determined to be the dollar appropriately compensate for the truly Medicare would share in the loss of amount per stay that achieves a total high cost cases with a much more high cost cases would provide an outlier percentage of 2 percent of the appropriate level of payment and incentive for an IPF to contain costs proposed prospective payments. The reduced financial risk without causing a once a case qualifies for outlier proposed outlier payment would be significant reduction in the per diem payments. We solicit comments on this defined as a proportion of the estimated base rate. Under a 2 percent outlier approach. cost beyond the outlier threshold. The policy, approximately 7 percent of IPF proportion of additional costs paid as cases qualify for outlier payments with c. Proposed Implementation of the outlier payments is referred to as the an average payment of $2,350 per case. Outlier Policy loss-sharing ratio. We chose to propose Providing outlier payments to 7 percent The intent of proposing an outlier the fixed dollar loss amount and the of cases meets the 10 percent target and policy is to adequately pay for truly loss-sharing ratios to allow the would provide outlier payment for only high-cost cases. However, we have estimated total outlier payments to be 2 the high cost IPF cases. Accordingly, we become aware that under the hospital percent of the total estimated proposed are proposing the outlier policy to be 2 inpatient prospective payment system, IPF prospective payments. percent of the total proposed IPF some hospitals have taken advantage of In order to determine the most payments. The amount of outlier two system features in the outlier policy appropriate outlier policy, our goal was payments would be funded by to maximize their outlier payments. The to analyze the extent to which the prospectively reducing the non-outlier first is the time lag between the current various outlier percentages reduce payment rates in a budget-neutral charges on a submitted claim and the financial risk, reduce incentives to manner. cost-to-charge ratio taken from the most under serve costly beneficiaries, and Under our proposed outlier policy, we recent settled cost report. Second, improve the overall fairness of the would make outlier payments for statewide average cost-to-charge ratios payment system. Our analysis showed discharges in which estimated costs are used in those instances in which an that the higher the outlier percentage, exceed an adjusted threshold amount acute care hospital’s operating or capital the more cases qualified for outlier ($4,200 multiplied by the IPF’s facility cost-to-charge ratios fall outside payments, and the less payment was adjustments, that is wages, rural reasonable parameters. We set forth made per case. Conversely, a low outlier location, and teaching status) plus the these parameters and the statewide cost- percentage resulted in a higher fixed total IPF prospective payment system to-charge ratios for acute care hospitals dollar loss threshold and although fewer adjusted payment amount for the in the annual publication of prospective cases exceeded the threshold, the discharge. The estimated cost for a case payment rates that are published by amount paid was more substantial. would be calculated by multiplying the August 1 of each year in accordance We began our analysis by determining overall facility-specific cost-to-charge with § 412.8(b)(2). Currently, these that if approximately 10 percent of IPF ratio by the total charges for the parameters represent 3.0 standard cases received an outlier payment, we inpatient stay. deviations (plus or minus) from the would be maintaining the basic premise In establishing the loss-sharing ratio, geometric mean of cost-to-charge ratios behind establishing an outlier policy, we considered establishing a single ratio for all hospitals. Hospitals could that is, to compensate IPFs for their consistent with the hospital inpatient arbitrarily increase their charges so far truly high cost cases. Also, this prospective payment system, which is above costs that their cost-to-charge percentage of cases, that is 10 percent, set at a marginal cost of 80 percent of ratios would fall below 3 standard is not inconsistent with the percentage the difference between the cost for the deviations from the geometric mean of of total outlier cases paid in other discharge and the adjusted threshold the cost-to-charge ratio. Thus, a higher prospective payment systems. amount. However, the proposed IPF statewide average cost-to-charge ratio Initially, we believed that a 5 percent prospective payment system unlike the would be applied to determine if the outlier policy would result in outlier hospital inpatient prospective payment hospital should receive an outlier payments for approximately 10 percent system is a per diem payment system, payment. This disparity results in their of total IPF cases. However, our analysis we are concerned that a single loss- cost-to-charge ratios being set too high, showed that a 5 percent outlier policy sharing ratio at 80 percent might which in turn results in an resulted in outlier payments for provide an incentive to increase length overestimation of their current costs per approximately 20 percent of IPF cases, of stay in order to receive additional case. paying an average of $1,975 per case. outlier payments. Therefore, we are The intention of the outlier policy Since 20 percent of IPF cases would proposing to reduce the loss-sharing under both the hospital inpatient receive an outlier payment, we do not ratio when the length of the stay prospective payment system and the believe that a 5 percent outlier policy increases beyond the median length of proposed IPF prospective payment limits outlier payments to only the truly stay. We believe that a reduction to the system is to make payments only when high cost cases. We then reduced the outlier loss-sharing ratio should occur the cost of care is extraordinarily high outlier policy to 3 percent and found in a similar manner to the declining per in relation to the average cost of treating that 12 percent of IPF cases received diem payment. The per diem payment comparable conditions or illnesses. We

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66935

believe that if hospitals’ charges are not to assign the national (either rural or 2. Adjustment of IPF Outlier Payments sufficiently comparable in magnitude to urban) median cost-to-charge ratio to the their costs, the legislative purpose IPF. Due to the small number of IPFs As discussed in the hospital inpatient underlying payment for outliers is compared to the number of acute care prospective payment system final rule thwarted. Thus, on June 9, 2003, we hospitals, we believe that statewide for outliers, we have implemented published a final rule in the Federal averages used in the hospital inpatient changes to the outlier policy used to Register (68 FR 34494) to ensure that prospective payment system, would not determine cost-to-charge ratios for acute outlier payments are paid for truly high- be statistically valid in the IPF context. care hospitals, because we became cost cases under the hospital inpatient In addition, the distribution of cost-to- aware that payment vulnerabilities exist prospective payment system. charge ratios for IPFs is not normally in the current outlier policy. Because we We believe the use of parameters is distributed and there is no limit to the believe the IPF outlier payment appropriate for determining cost-to- upper ceiling of the ratio. For these methodology is likewise susceptible to charge ratios to ensure these values are reasons, the average value tends to be the same payment vulnerabilities, we reasonable and that outlier payments overstated due to the higher values on are proposing the following: can be made in the most equitable the upper tail of the distribution of cost- • Include in proposed manner possible. Further, we believe to-charge ratios. Therefore, we are § 412.424(c)(2)(v) a cross-reference to the proposed methodology of computing proposing to use the national median by § 412.84(i) that was included in the final IPF outlier payments is susceptible to urban and rural type as the substitution rule published in the Federal Register the same payment enhancement value when the facility’s actual cost-to- on June 9, 2003 (68 FR 34515). Through practices identified under the hospital charge ratio is outside the trim values. this cross-reference, we are proposing inpatient prospective payment system Cost-to-charge ratios above this ceiling that fiscal intermediaries would use because it depends on the cost-to-charge are probably due to faulty data reporting more recent data when determining an ratio to determine the IPF’s cost. or entry, and, therefore, should not be IPF’s cost-to-charge ratio. Specifically, Accordingly, as discussed below, we are used to identify and make payments for as provided in § 412.84(i), we are proposing provisions for implementing outlier cases because these data are proposing that fiscal intermediaries the outlier policy to ensure the clearly erroneous and should not be would use either the most recent settled statistical accuracy of cost-to-charge relied upon. In addition, we propose to IPF cost report or the most recent ratios and appropriate adjustment of IPF update and announce the ceiling and tentatively settled IPF cost report, outlier payments. averages using this methodology every whichever is later to obtain the 1. Statistical Accuracy of Cost-to-Charge year. applicable IPF cost-to-charge ratio. In Ratios • We will not apply the applicable addition, as provided under § 412.84(i), any reconciliation of outlier payments We believe that there is a need to national median cost-to-charge ratio when an IPF’s cost-to-charge ratio falls will be based on a ratio of costs to ensure that the cost-to-charge ratio used charges computed from the relevant cost to compute an IPF’s estimated costs below a floor. We are proposing this policy because we believe IPFs could report and charge data determined at the should be subject to a statistical time the cost report coinciding with the measure of accuracy. Removing aberrant arbitrarily increase their charges in discharge is settled. data from the calculation of outlier order to maximize outlier payments. • payments will allow us to enhance the Even though this arbitrary increase in Include in proposed extent to which outlier payments are charges should result in a lower cost-to- § 412.424(c)(2)(v) a cross reference to equitably distributed and continue to charge ratio in the future (due to the lag § 412.84(m) (that was included in the reduce incentives for IPFs to under time in cost report settlement), if we final rule published in the Federal serve patients who require more costly propose a floor on cost-to-charge ratios, Register on June 9, 2003 (68 FR 34415) care. Further, using a statistical measure we would apply the applicable national to revise the outlier policy under the of accuracy to address aberrant cost-to- median for the IPFs actual cost-to- hospital inpatient prospective payment charge ratios would also allow us to be charge ratio. Using the national median system). Through this cross-reference, consistent with the outlier policy under cost-to-charge ratio in place of the we are proposing that IPF outlier the hospital inpatient prospective provider’s actual cost-to-charge ratio payments may be adjusted to account payment system. Therefore, we are would estimate the IPF’s costs higher for the time value of money during the making the following two proposals: than they actually are and may allow time period it was inappropriately held • We will calculate two national the IPF to inappropriately qualify for by the IPF as an ‘‘overpayment.’’ We ceilings, one for IPFs located in rural outlier payments. also may adjust outlier payments for the areas and one for facilities located in Accordingly, we are proposing to time value of money for cases that are urban areas. We propose to compute apply the IPF’s actual cost-to-charge ‘‘underpaid’’ to the IPF. In these cases, this ceiling by first calculating the ratio to determine the cost of the case the adjustment will result in additional national average and the standard rather than creating and applying a payments to the IPF. We are proposing deviation of the cost-to-charge ratios for floor. In such cases as described above, that any adjustment will be based upon both urban and rural IPFs. applying an IPF’s actual cost-to-charge a widely available index to be To determine the rural and urban ratio to charges in the future to established in advance by the Secretary, ceilings, we propose to multiply each of determine the cost of the case will result and will be applied from the midpoint the standard deviations by 3 and add in more appropriate outlier payments. of the cost reporting period to the date the result to the appropriate national Consistent with the policy change of reconciliation. We are still assessing cost-to-charge ratio average (either rural under the hospital inpatient prospective the procedural changes that would be or urban). We believe that the method payment system, we are proposing that necessary to implement this change. explained above results in statistically IPFs would receive their actual cost-to- d. Computation of Proposed Outlier valid ceilings. If an IPF’s cost-to-charge charge ratios no matter how low their Payments ratio is above the applicable ceiling, the ratios fall. We are still assessing the ratio is considered to be statistically procedural changes that would be In order to illustrate the proposed inaccurate. Therefore, we are proposing necessary to implement this change. outlier payment mechanism, we present

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66936 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

the following example of how we would The prospective payment amount (per diem allowable charge of $20,000. In this calculate the outlier payment. payments plus adjustments) was $8,000. case, the total allowable costs for Mr. × Example: John Smith was hospitalized at a To determine whether this case Smith’s case is $14,400 ($20,000 .72). non-teaching IPF facility in Richmond, qualifies for outlier payments, it would Because the IPF is a non-teaching urban Virginia for 14 days. His total allowable be necessary to compute the cost of the facility, the fixed dollar threshold is billed charges for the 14 days was $20,000. case by multiplying the facility’s overall adjusted by the wage index 0.9477. cost-to-charge ratio of .72 by the

TABLE 4.—COMPUTATION EXAMPLE OF THE PROPOSED OUTLIER PAYMENT

Steps to Calculate the Proposed Outlier Payment

Calculate the Fixed Dollar Loss Threshold: Fixed Dollar Threshold ...... $4,200 Wage adjusted labor share (.72828×4,200)*0.9477 ...... $2,899 ...... Non Labor Share (0.27172 × $4.200) ...... 1,141 ...... Adjusted Fixed Dollar Threshold ($2,899+$1,141) ...... 4.040 ...... Calculate Eligible Outlier Costs: Hospital Costs ...... 14,400 ...... Adjusted Fixed Dollar Threshold ...... 4,040 Prospective Payment System Adjusted Payment ...... 8,000 ...... Eligible for Outlier Costs ($14,400¥$4,040¥$8,000) ...... 2,360 Calculate the Loss Sharing Ratio Amount: Per Diem Outlier Costs ($2,360/14 days) ...... 169 Loss-sharing Ratio Days 1 through 8 ($169×.80×8 days) ...... 1,079 ...... Loss-sharing Ratio Days 9 through 14 $169×.60 ×6 days) ...... 607 ...... The Total Outlier Payment Amount $1,079+$607) ...... 1,686 ......

e. Interrupted Stays consecutive calendar days, we would For the purposes of counting the 5- treat both stays as a single stay. calendar day time period to determine Since per diem payments under the Therefore, we would not apply the the length of the interrupted stay, the proposed IPF prospective payment variable per diem adjustment for the day of discharge would be counted as system would be higher for the first 8 second admission and would combine ‘‘day 1’’, with midnight of that day days of a stay (the variable per diem the costs of both stays for the purpose serving as the end of that calendar day. adjustment discussed earlier in this of determining whether the case The 4 calendar days that immediately section), we are proposing to adopt an qualifies for outlier payments. follow day 1 would be days 2 through interrupted stay policy. The policy is We considered defining an 5. intended to reduce incentives to move interrupted stay as a readmission within patients among Medicare-covered sites 8 days of discharge since the variable C. Development of the Proposed Budget- of care in order to maximize Medicare per diem adjustments are not applied Neutral Federal Per Diem Base Rate payment. We are concerned that IPFs after the 8th day of the stay. We are not 1. Data Used To Develop the Proposed could maximize payment by proposing this definition for an Federal Per Diem Base Rate prematurely discharging patients after interrupted stay because we believe that the 8 days during which they receive after an 8-day absence from the IPF, Based on the regression analysis, we higher payments (the variable per diem many of the services that account for are proposing a prospective payment adjustments), and then readmitting the increased costs early in an inpatient system for IPFs based on a per diem same patient. In some cases a discharge psychiatric stay would need to be payment amount calculated from and subsequent readmission within a repeated, for example, assessments and average costs adjusted for budget short period of time may be appropriate. laboratory testing. After a shorter neutrality. The per diem amount would For example, we are concerned, in absence from the IPF of 1 through 4 be adjusted by a budget-neutrality factor particular, that when there is a days, however, many of those to arrive at the Federal per diem base psychiatric unit within an acute care admission-related services such as rate used as the standard payment per hospital, a patient could be transferred psychiatric evaluations and the patient’s day for the proposed IPF prospective from the unit after only a few days of medical history would not need to be payment system. The proposed Federal care to another part of the hospital and repeated. Therefore, we believe the per diem base payment would be then be readmitted to the psychiatric lower end of the last range of payment adjusted by the proposed wage index unit. In this scenario, the hospital could adjustment, that is, 5 days, would and the proposed patient-level and receive the per diem adjustments for provide for appropriate per diem facility-level characteristics identified in both stays in the psychiatric unit as well payment adjustment as well as provide the regression analysis. To calculate the as receive the DRG payment associated a disincentive to inappropriately shift proposed per diem amount, we would with the acute hospital stay. patients between Medicare-covered sites estimate the average cost per day for— In proposed § 412.402, we define an of care. In addition, we intend to (1) routine services from the most recent interrupted stay as one in which the monitor the extent and timing of available cost report data (cost reports patient is discharged from an IPF and readmissions to IPFs and plan to beginning in FY 1999 supplemented returns to the same IPF within 5 account for changes in practice patterns with 1998 cost reports if the 1999 cost consecutive calendar days. Specifically, as we refine the proposed IPF report is missing); and (2) ancillary costs we are proposing in § 412.424(d) that if prospective payment system. Public per day using data from the 1999 a patient is discharged from an IPF and comments are welcome on the proposed Medicare bills and corresponding data returns to the same IPF within 5 definition of an interrupted stay. from facility cost reports.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66937

2. Calculation of the Proposed Per Diem by the corresponding cost-to-charge payment system is cost reporting Amount ratio provided an estimate of the costs periods beginning on or after April 1, For routine services, the proposed per for all ancillary services received by the 2004. In order to create a more even and diem operating and capital costs would patient during the stay. For those efficient process of updates for the be used to develop the base for the departmental cost-to-charge ratios that various Medicare payment systems, we psychiatric per diem amount. The per we considered to be aberrant because are recommending that the first Federal diem routine costs were obtained from they were outside the statistically base rate update occur on July 1, 2005. each facility’s Medicare cost report. To valued trim points of plus or minus 3.00 Therefore, we calculated the proposed estimate the costs for routine services standard deviations from the facility- Federal base rate to be budget neutral included in developing the proposed type mean, we replaced the individual for the 15-month period April 1, 2004 per diem amount, we summed the total cost-to-charge ratios for each through June 30, 2005. The data sources we used to calculate routine costs (including costs for department with the median department the budget-neutrality factor were the capital) submitted on the cost report for cost-to-charge ratio by facility type most complete data available for IPFs each provider and divided it by the total (psychiatric hospital or psychiatric and included cost report data from FY Medicare days. Some average routine unit). Because the distribution of ratios 1999 and the 1999 Medicare claims data costs per day were determined to be of cost-to-charges is not normally from the June 2001 update of the aberrant, that is, the costs were distributed and because there is no limit to the upper ceiling of the ratio, the MedPAR files. We updated the cost extraordinarily high or low and most mean value tends to be overstated due report data for each IPF to the midpoint likely contained data errors. The to the higher values on the upper tail of of that 15-month period (April 1, 2004 following method was used to trim the bell curve. Therefore, we chose the through June 30, 2005) and used the extraordinarily high or low cost values median by facility type as a better projected market basket update factors in order to improve accuracy of our measure for the substitution value when for each applicable year. results. First, the average and standard the facility’s actual cost-to-charge ratio We note that the FY 1999 cost report deviations of the total per diem cost was outside the trim values. file is not complete because of the lag (routine and ancillary costs) were After computing the estimated costs in the filing of cost reports for some computed separately for cases from by applying the cost-to-charge ratios to providers, therefore, a small number of psychiatric hospitals and psychiatric the total ancillary charges for each IPFs do not have cost report data for the units (separate statistics were computed patient stay, we would determine the 1999 cost report period. To include as for the groups of IPFs, because we did average ancillary amount per day by many IPFs in the payment calculation as not want to systematically exclude a dividing the total ancillary costs for all possible, we filled in the missing data larger proportion of cases from the stays by the total covered Medicare using data from the previous year for higher cost psychiatric units). Before days. Using this methodology, the those IPFs. The prospective payment calculating the means, we trimmed average ancillary cost per day would be projections were based on case level cases from the file when covered days $67. data from the 1999 MedPAR files and were zero or routine costs were less than Adding the average ancillary costs per the facility level characteristics from the $100 or greater than $3,000. We selected day ($67) and the facility’s average 1999 cost reports. These data provide these amounts because we believe this routine costs per day including capital the input for the development of the range captured the grossly aberrant costs ($495) provides the base payment appropriate update factors to be applied cases. Elimination of the grossly amount ($562) for the estimated average to the proposed prospective payment aberrant cases would prevent the means per diem amount for each patient day of model. from being distorted. Second, we inpatient psychiatric care. trimmed cases when the provider’s total a. Cost Report Data for April 1, 2004 cost per day was outside the standard 3. Determining the Update Factors for Through June 30, 2005 and generally used statistical trim the Budget-Neutrality Calculation In order to determine each provider’s points of plus or minus 3 standard Section 124(a)(1) of Pub. L. 106–113 projected costs for the proposed deviations from the respective means for requires that the proposed IPF implementation period, we are each facility type (psychiatric hospitals prospective payment system be budget proposing to update each IPF’s cost to and psychiatric units). If the total cost neutral. In other words, the amount of the midpoint of the period April 1, 2004 per day was outside the trim value, we total payments under the proposed IPF through June 30, 2005. To calculate would delete the data for that provider prospective payment system, including operating costs, we would use the from the per diem rate development file. any payment adjustments, must be applicable percentage increases to the This method of trimming is consistent projected to be equal to the amount of TEFRA target amounts for FYs 1999 with the method used for the regression total payments that would have been through 2002 (in accordance with analysis. After trimming the data, the made if the proposed prospective § 413.40(c)(3)(vii)) and the full excluded average routine cost per day would be payment system were not implemented. hospital market-basket percentage $495. Therefore, we are proposing to calculate increase for FY 2003 and later. For FYs For the ancillary services, we would the budget-neutrality factor for the 1999 through 2002, we would determine calculate the costs by converting charges implementation period by setting the the appropriate update factor for each from the 1999 Medicare claims into total estimated prospective payment year by using the methodology costs using facility-specific, cost-center system payments equal to the total described below: specific cost-to-charge ratios obtained estimated payments that would have • For IPFs with costs that equal or from each provider’s applicable cost been made under the TEFRA exceed their target amounts by 10 reports. We matched each provider’s methodology had the proposed percent or more for the most recent cost departmental cost-to-charge ratios from prospective payment system not been reporting period for which information their Medicare cost report to each implemented. is available, the update factor would be charge on their claims reported in the As discussed in section IV of this the market-basket percentage increase. MedPAR file. Multiplying the total proposed rule, the implementation date • For IPFs that exceed their target charges for each type of ancillary service of the proposed IPF prospective amounts by less than 10 percent, the

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66938 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

update factor would be equal to the § 413.40(c)(4)(iii), an IPF’s facility- Each IPF’s payment for capital-related market basket minus 0.25 percentage specific target is the lower of its net costs would be taken directly from the points for each percentage point in allowable base-year costs per discharge cost report and updated for inflation which operating costs are less than 10 increased by the applicable update using the excluded capital market percent over the target (but in no case factors or the cap for the applicable cost basket. less than 0 percent). reporting period. In determining each Step 4: IPF’s Total (Operating and • For IPFs that are at or below their IPF’s facility-specific target amount, we target amounts but exceed 66.7 percent Capital-Related Costs) Payment Under would use the labor-related and non- the TEFRA Payment System of the target amounts, the update factor labor related shares of the national cap would be the market basket minus 2.5 amounts for FY 2002 that appeared in Once estimated payments for percentage points (but in no case less the hospital inpatient prospective inpatient operating costs are determined than 0 percent). payment system final rule published in (including bonus and relief payments, • For IPFs that do not exceed 66.7 the Federal Register on August 1, 2001 as appropriate), we would add the percent of their target amounts, the (66 FR 39916). For existing IPFs (that is, TEFRA adjusted operating payments update factor would be 0 percent. and capital-related cost payments • IPFs paid under TEFRA before October For FYs 2003 and later, we use the 1, 1997), we adjusted the labor-related together to determine each IPF’s total most recent estimate of the percentage share ($8,429) by the applicable payments under the TEFRA payment increase projected by the excluded geographic wage index and added that system. hospital market-basket index. amount to the non-labor related share In addition, since the proposed c. Payments Under the Proposed ($3,351). For new IPFs (that is, IPFs first prospective payment system would Prospective Payment System Without a paid under TEFRA after October 1, include both the operating and capital- Budget-Neutrality Adjustment 1997), we adjusted the labor-related related costs, we needed to project the Payments under the proposed share ($6,815) and added that amount to capital-related cost under the TEFRA prospective payment system would be the non-labor related share ($2,709). system as well. We used the excluded estimated without a budget-neutrality capital market basket to project the Step 2: IPF’s Payment Amount for adjustment. We used $562 (the average capital-related costs under the TEFRA Inpatient Operating Services cost per day consistent with the average system. Table 5 below, summarizes the Under the TEFRA system, an IPF’s cost per day used in the regression excluded hospital market basket and the payment amount for inpatient operating model) as the starting point for the excluded capital market basket indexes. services is the lower of— Federal per diem base rate. By applying • The hospital-specific target amount the aggregate cost increase factor using TABLE 5.—PROPOSED EXCLUDED (subject to application of the cap as the applicable market basket increase HOSPITAL MARKET BASKET AND EX- determined in Step (1) multiplied by the factors, we updated the base rate to the CLUDED CAPITAL MARKET BASKET number of Medicare discharges (the April 1, 2004 through June 30, 2005 ceiling); or period. The updated cost per day of Excluded hos- Excluded cap- • The hospital’s average inpatient $671 was then used in the payment Fiscal year pital market ital market operating cost per case multiplied by model to project future payments under basket percent basket percent the number of Medicare discharges. the proposed IPF prospective payment FY 1999 .... 2.9 0.9 In addition, under the TEFRA system, system. The next step was to apply the FY 2000 .... 3.3 1.2 payments may include a bonus or relief associated proposed wage index and all FY 2001 .... 4.3 1.0 payment, as follows: applicable proposed patient-level and FY 2002 .... 3.9 0.9 • IPFs whose net inpatient operating facility-level adjustments to determine FY 2003* ... 3.7 0.8 costs are lower than or equal to the the appropriate proposed prospective FY 2004* ... 3.5 1.1 ceiling, would receive the lower payment amount for each stay in the FY 2005* ... 3.2 1.1 payment of either the net inpatient final payment model file. *NOTE: Projected Percentage. operating costs plus 15 percent of the We note that no separate wage or difference between the inpatient standardization factors were applied to b. Estimate of Total Payments Under the operating costs and the ceiling; or the the per diem amount used to derive the TEFRA Payment System net inpatient operating costs plus 2 total proposed prospective payment We estimated payments for inpatient percent of the ceiling. system payments as these factors would operating and capital services under the • IPFs whose net inpatient operating be accounted for through the budget- current TEFRA system using the costs are greater than the ceiling, but neutrality computation described below. following methodology: less than 110 percent of the ceiling, Thus, when the total proposed would receive the ceiling payment. prospective payment system payments Step 1: IPF’s Facility-Specific Target • IPFs whose net inpatient operating are compared to projected TEFRA Amount. costs are greater than 110 percent of the payments, the resulting factor applied to The facility-specific target amount for ceiling would receive the ceiling the per diem amount would implicitly an IPF would be calculated based on the payment plus the lower of 50 percent of account for the effects of wage and IPF’s allowable inpatient operating cost the difference between the 110 percent standardization adjustments to the per per discharge for the base period, of the ceiling and the net inpatient diem costs. excluding capital-related, nonphysician operating costs or 10 percent of the d. Calculation of the Proposed Budget- anesthetist, and medical education ceiling payment. costs. We would update this target Neutral Adjustment amount using a rate-of-increase Step 3: IPF’s Payment for Capital- In determining the proposed budget- percentage as specified in Related Costs neutrality factor, we compared the § 413.40(c)(3)(viii). Under the TEFRA system, in proposed prospective payment system From FYs 1998 through 2002, there accordance with section 1886(g) of the amounts calculated from the psychiatric were two national caps on the payment Act, Medicare allowable capital-related stays in the 1999 MedPAR file to the amounts for IPFs. As specified in costs are paid on a reasonable cost basis. projected TEFRA payments from the

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66939

1999 cost report file (as explained in IPFs will have an incentive to ensure that a patient’s continued stay in greater detail in section b. above). The comprehensively code for the presence an IPF is medically necessary. proposed budget-neutrality adjustment of comorbidities, thus, ultimately, the As specified in existing § 424.14(c), a was calculated by dividing total coding practice of IPFs should improve physician must recertify that inpatient estimated payments under the TEFRA once the proposed IPF prospective psychiatric services furnished since the payment system by estimated payments payment system is implemented. previous certification were, and under the proposed IPF prospective As a result, Medicare may incur continue to be required: (1) For payment system without a budget- higher payments than assumed in our treatment that could reasonably be neutrality adjustment. calculation. These effects were taken expected to improve the patient’s Since the proposed IPF prospective into account when we calculated the condition or for diagnostic study; and payment system amount for each proposed budget-neutral Federal per (2) the hospital’s records show that the provider would include applicable diem base rate. Accounting for these services furnished were intensive outlier amounts, we reduced the effects through an adjustment is treatment services, admission and proposed budget neutral per diem base commonly known as a behavioral offset. related services necessary for diagnostic rate by 2 percent to account for the 2 Based on accepted actuarial practices study, or equivalent services. We are percent of aggregate proposed and consistent with the assumptions proposing to add a requirement that the prospective payments to be made for made under the inpatient rehabilitation physician recertify that the patient outlier payments. The appropriate facilities (IRF) prospective payment continues to need, on a daily basis, proposed outlier amount was system, in determining this proposed inpatient psychiatric care (furnished determined by comparing the adjusted behavioral offset, we assumed that the directly by or requiring the supervision prospective payment amount for the IPFs would regain 15 percent of of inpatient psychiatric facility entire stay to the computed cost per potential ‘‘losses’’ and augment personnel) or other professional services case. If costs were above the prospective payment increases by 5 percent. We that, as a practical matter can only be payment amount plus the adjusted fixed applied this actuarial assumption, provided on an inpatient basis. dollar loss threshold, an outlier which was based on consideration of Section 424.14(d)(2) requires the first payment was computed using the our historical experience with new recertification after admission to occur applicable risk-sharing percentages as payment systems, to the estimated as of the 18th day of hospitalization. We explained in greater detail in section ‘‘losses’’ and ‘‘gains’’ among the IPFs. are proposing to revise the timing of the III.B.3 of this proposed rule. The outlier We intend to monitor the extent to first recertification to the 10th day of amount was computed for all stays and which current practice in IPFs such as hospitalization in order to align the the total outlier amount was added to the average length of stay is affected by physician recertification of the need for the final proposed prospective payment implementation of a per diem payment continuation of the inpatient stay with amount. If the total outlier amount for system and may propose adjustments to the median length of stay. As noted all providers was determined to be the behavioral assumptions accordingly. previously, according to the 1999 higher or lower than 2 percent of the The above methodology made no MedPAR data, the median length of stay total payments under the proposed behavioral assumptions for changes in for Medicare beneficiaries was 9 days. prospective payment system, then the the number of total psychiatric beds or These proposed changes are intended to fixed dollar loss threshold was adjusted the shift of utilization among types of ensure that a patient’s continued stay in accordingly. The proposed fixed dollar psychiatric hospitals. an IPF is medically necessary and more loss threshold was determined to be closely tied to the median length of stay. 5. Proposed Federal Per Diem Base Rate $4,200. We acknowledge that the additional The proposed Federal per diem base protections afforded by the unique 4. Proposed Behavioral Offset rate with an outlier adjustment and psychiatric hospital conditions of We would calculate the proposed budget neutrality with a behavioral participation (COPs) in subpart E of part budget-neutral Federal per diem base offset would be $530. This proposed 482, which create administrative criteria rate by applying the budget-neutrality dollar amount would include a 2- and documentation requirements for factor calculated above and the 2 percent reduction to account for outlier psychiatric patients, are an additional percent adjustment for outlier payments payments, and a 19-percent reduction to protection in this regard. We believe to $671 (the average cost per day for the account for budget neutrality and the these requirements provide adequate 15-month period, April 1, 2004 through behavioral offset to the proposed protection against the shift of lower cost June 30, 2005). However, if the Federal per diem base rate otherwise nursing home patients with similar but proposed IPF prospective payment calculated under the proposed less severe diagnoses into psychiatric system is implemented as proposed, we methodology as described above. hospitals. However, if we observe a shift would expect that IPFs may experience of less severe cases into psychiatric 6. Proposed Changes to Physician usage patterns that are significantly hospitals, we may perform targeted Recertification Requirements different from their current usage reviews of admissions to assure that the patterns. Two examples are—(1) the In addition to the monitoring efforts COPs and physician certification proposed IPF prospective payment mentioned above, we are proposing requirements are being appropriately system is a per-diem system, therefore, changes in the physician recertification followed. IPFs might have an incentive to keep requirements for inpatient psychiatric patients in the facility longer to care as specified in § 424.14. This E. Proposed Area Wage Adjustment maximize use of their beds or to receive section states that Medicare Part A pays Due to the variation in costs, because the proposed outlier payments; and (2) for inpatient psychiatric care only if a of the differences in geographic wage the current TEFRA payment system physician certifies and recertifies the levels, we are proposing that payment does not rely on ICD–9–CM coding. need for services. Therefore, we are rates under the proposed IPF Proper comorbidity coding, however, proposing to revise § 424.14(c), prospective payment system be adjusted will have an impact on the proposed regarding the content of the physician by a geographic index. In addition, we prospective payments under this recertification and § 424.14(d), regarding are proposing to use the inpatient acute proposed rule. Therefore, we expect that the timing of physician recertification to care hospital wage data to compute the

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66940 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

IPF wage indices, because there is not consistent with the area wage costs (wages and salaries, employee an IPF-specific wage index available. adjustments used in other non-acute benefits, professional fees, and labor- We believe that the inpatient acute care care facility prospective payment intensive services) is 69.348 percent, as hospital wage data reflects wage levels systems. shown below in Table 6. The portion of similar to psychiatric units as well as To account for wage differences, we capital that is influenced by local labor free-standing psychiatric hospitals. We first identified the proportion of labor markets is estimated to be 46 percent. also believe that IPFs generally compete and non-labor components of costs. We Because the relative importance of in the same labor market as inpatient used our proposed 1997-based excluded capital is 7.566 percent of the proposed acute care hospitals. hospital market basket with capital to 1997-based excluded hospital with Furthermore, we are proposing to determine the labor-related share. We capital market basket for the period adjust the labor-related portion of the calculated the proposed labor-related April 1, 2004 through June 30, 2005, we proposed prospective payment rates for share as the sum of the weights for those would take 46 percent of 7.566 percent area differences in wage levels by a cost categories contained in the to determine the proposed labor-related factor reflecting the relative facility proposed 1997-based excluded hospital share of capital. The result, 3.48 wage level in the geographic area of the with capital market basket that are percent, is then added to the proposed IPF compared to the national average influenced by local labor markets. These 69.348 percent calculated for operating wage level for these hospitals. We cost categories include wages and costs to determine the total proposed believe that the actual location of the salaries, employee benefits, professional labor-related relative importance. The IPF as opposed to the location of fees, labor-intensive services, and a 46 resulting labor-related share that we affiliated providers is most appropriate percent share of capital-related propose to use for the proposed IPF for determining the wage adjustment expenses. The labor-related share for the prospective payment system is 72.828 because the data support the premise base period of the proposed prospective percent. The table below shows that the that the prevailing wages in the area in payment system (April 1, 2004 through proposed labor-related share would which the IPF is located influence the June 30, 2005) is the sum of the relative have been 73.570 percent if we had not cost of a case. Thus, we are using the importance of each labor-related cost rebased the excluded hospital with inpatient acute care hospital wage data category for this period, and reflects the capital market basket using more recent without regard to any approved different rates of price change for these 1997 data rather than using 1992 data. geographic reclassification as specified cost categories between the base year As shown in Table 6, rebasing results in in section 1886(d)(8) or 1886(d)(10) of (FY 1997) and this period. The sum of a lowering of the labor-related share by the Act. We note this policy is the relative importance for operating .742 percent.

TABLE 6.—PROPOSED LABOR-RELATED SHARE RELATIVE IMPORTANCE

Relative Im- Relative Im- portance portance 1992-based 1997-based Cost Category Market Basket Market Basket (April 2004 to (April 2004 to June 2005) June 2005)

Wages and salaries ...... 50.714 49.158 Employee benefits ...... 11.930 11.077 Professional fees ...... 2.060 4.540 Postage ...... 0.252 ...... All other labor intensive services ...... 5.252 4.572 Subtotal ...... 70.209 69.348 Labor-related share of capital costs ...... 3.360 3.480

Total ...... 73.570 72.828

A precedent exists for using this contract labor costs and hours; and (4) Budget (OMB). In addition, we are method to determine the proportion of wage-related costs. The wage data proposing to define a rural area as any payments adjusted for geographic excludes wages for services provided by area outside an urban area. The differences in labor costs. Specifically, teaching physicians, interns and proposed IPFs wage indices would be the labor-related share for acute care residents, and nonphysician anesthetists computed as follows: hospitals is determined from the under Medicare Part B, because we • Compute an average hourly wage prospective payment system hospital would not cover these services under for each urban and rural area. operating market basket using a similar the proposed IPF prospective payment • method. system. Compute a national average hourly wage. We believe that a wage index based Consistent with the wage index • on acute care hospital wage data is the methodologies in other prospective Divide the average hourly wage for best and most appropriate wage index to payment systems, we are proposing to each urban and rural area by the use in adjusting payments for IPFs, divide IPFs into labor market areas. For national average hourly wage. since both the acute care hospitals and the purpose of defining labor market The result is a proposed wage index IPFs compete in the same labor markets. areas, we are proposing to define an for each urban and rural area (see This wage data includes the following urban area as a Metropolitan Statistical Addendum B1 for the proposed wage categories of data: (1) Salaries and hours Area (MSA) or New England County index for urban areas and Addendum from short-term acute care hospitals; (2) Metropolitan Area (NECMA), as defined B2 for the proposed wage index for rural home office costs and hours; (3) certain by the Office of Management and areas).

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66941

To calculate the wage-adjusted facility year transition period from the cost- base amount by the appropriate wage payments, we are proposing the based TEFRA reimbursement to index and applicable IPF prospective following method: (1) Multiply the payment based on 100-percent payment system payment adjustments prospectively determined Federal base prospective payment. During the and adding any applicable outlier rate by the labor-related percentage to transition period, we are proposing that amounts. An example of how to determine the labor-related portion; (2) an IPF would be paid a blend of an calculate payment under the proposed multiply this labor-related portion by increasing percentage of the IPF Federal IPF prospective payment system the applicable IPF wage index; and (3) per diem payment amount and a follows. add the resulting wage-adjusted labor- decreasing percentage of its TEFRA rate related portion to the nonlabor-related for each discharge. Since the estimated Example: Jane Doe, a 78-year-old female, is portion, resulting in a wage-adjusted prospective payments were calculated admitted to a psychiatric unit within the Get base rate. in a budget-neutral manner, this Well General Hospital located in Richmond, proposed transition methodology would Virginia. Ms. Doe presents with signs and F. Effect of the Proposed Transition on result in the same total estimated symptoms indicating a primary diagnosis of Budget Neutrality payments that are expected under the Major Depressive Disorder (ICD–296.33, Section 124(a)(1) of Pub. L. 106–113 current rules. DRG–430). Her medical history includes requires that the proposed IPF Uncontrolled Type 1 Diabetes with prospective payment system maintain G. Calculation of the Proposed Payment Ophthalmic manifestations (ICD–250.53) and budget neutrality. As discussed in Payments under the proposed IPF Chronic Renal Failure (ICD–585). Ms. Doe further detail in section IV of this prospective payment system would be remains in the hospital for 5 days. proposed rule, we are proposing a 3- determined by adjusting the per diem

TABLE 7.—EXAMPLE OF PROPOSED PAYMENT

Steps To Determine the Proposed Per Diem Payment

Federal Base Prospective Payment Rate: Calculate Wage Adjusted Federal Base Rate ...... $530 Calculate the labor portion of the Federal base rate (.72828 × $530) ...... 386 Apply wage index factor from Addendum B1 for Richmond Virginia (0.9477 × $386) ...... $366 ...... Calculate the non-labor of the Federal base rate: (0.27172 × $530) ...... $144 ...... Calculate total wage-adjusted Federal base rate: ($366 + $144) ...... $510 ...... Apply Facility Level Adjusters: Teaching adjustment (not applicable) ...... Rural adjustment (not applicable) ...... Apply Patient Level Adjusters: DRG adjustment for DRG 430 ...... 1.00 ...... Age adjustment (over 65) ...... 1.13 ...... Comorbidity adjusters: Diabetes ...... 1.11 ...... Chronic renal failure ...... 1.12 ...... Total prospective payment adjustment factor: (1.00 × 1.13 × 1.11 × 1.12): ...... 1.405 ...... Calculate Wage Adjustment and Prospective Payment System Adjusted Federal Per Diem: ($510 × 1.405) ...... 716 Apply Variable Per Diem Adjustments: Day 1: (1.26 × $716) ...... $902 ...... Days 2 to 4: (1.12 × $716 x 3) ...... $2,406 ...... Day 5: (1.05 × $716) ...... $752 ...... The Total Proposed Prospective Payment System Payment for Jane Doe’s IPF Stay ...... $4,060 ......

IV. Implementation of the Proposed IPF specific amount based on the IPF’s that for cost reporting periods beginning Prospective Payment System TEFRA payment. As noted above, we on or after July 1, 2005 and before July are proposing that the system would 1, 2006, the total payment would consist We are proposing that payment to an become effective for cost reporting of 50 percent based on the TEFRA IPF would convert to the IPF periods beginning on or after April 1, payment system, and 50 percent based prospective payment system at the 2004. on the proposed IPF prospective beginning of its first cost reporting As discussed in section V. of this period beginning on or after April 1, payment amount. In addition, we are proposed rule, we are proposing that the also proposing that for cost reporting 2004. first year of the transition would periods beginning on or after July 1, continue for 15 months, thereby, A. Proposed Transition 2006 and before July 1, 2007, the total moving the IPF prospective payment We are proposing a 3-year transition system to a July 1 update cycle. As a payment would consist of 25 percent to fully implement the IPF prospective result, the first year of the transition based on the TEFRA payment system payment system. During that time, we period would be for cost reporting and 75 percent based on the proposed propose to use two payment percentages periods beginning on or after April 1, IPF prospective payment amount. Thus, to determine an IPF’s total payment 2004 and before July 1, 2005. The total we are proposing that payments to IPFs under the proposed IPF prospective payment for this period would consist would be at 100 percent of the proposed payment system. In addition, during the of 75 percent based on the TEFRA IPF prospective payment amount for proposed transition, IPFs would receive payment system and 25 percent based cost reporting periods beginning on or a blended payment of the Federal per on the proposed IPF prospective after July 1, 2007. Given the complex diem payment amount and a hospital- payment amount. We are also proposing and redistributive nature of the

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66942 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

proposed prospective payment system C. Claims Processing Excluded from PIP amounts are and in order to thoroughly review the With respect to the proposed IPF outlier payments that are paid upon the anticipated volume of comments we prospective payment system, we are submission of a discharge bill. Also, expect to receive on this proposed rule, proposing to continue processing claims Part A costs that are not paid under the it may ultimately be necessary to delay in a manner similar to the current proposed IPF prospective payment implementation beyond April 2004. In claims processing system. Hospitals system, including Medicare bad debts addition, it may be helpful to increase would continue to report diagnostic and costs of an approved education the transition period because a longer information on the claim form and the program, and other costs paid outside transition period would allow us to Medicare fiscal intermediaries would the IPF prospective payment system, adjust the payment system if necessary continue to enter clinical and will be subject to the interim payment before the full implementation of the demographic information in their claims provisions as specified in § 413.64. IPF prospective payment system. Also, processing systems for review by the Under the proposed prospective a longer transition period may be Medicare Code Editor (MCE). The MCE payment system, if an IPF is not paid appropriate if the research designed to reviews claims to determine if they are under the PIP method it may qualify to refine the payment system takes longer improperly coded (for example, receive an accelerated payment. As than we currently anticipate. We diagnosis inappropriate to sex of the specified in proposed § 412.432(e), the specifically request public comments on patient) or require more information IPF must be experiencing financial these implementation issues. (imprecise coding) in order to be difficulties due to a delay by the intermediary in making payment to the In order to mitigate the impacts of the processed. After screening, each claim would be classified into the appropriate IPF, or there is a temporary delay in the prospective payment system, we are not IPFs preparation and submittal of bills proposing to allow an IPF to elect to be DRG by a software program called the ‘‘GROUPER.’’ If the ‘‘GROUPER’’ assigns to the intermediary beyond its normal paid based on 100 percent of the Federal billing cycle, because of an exceptional per diem payment amount in lieu of the a DRG that is not recognized under the proposed IPF prospective payment situation. A request for an accelerated blended methodology. In this way, the system, the claim would be returned to payment must be made by the IPF and transition will allow IPFs time to the IPF. If the ‘‘GROUPER’’ assigns a approved by the intermediary and us. become familiar with the prospective DRG recognized by the system, a The amount of an accelerated payment payment system and gradually move to ‘‘PRICER’’ program would calculate the would be computed as a percentage of the full Federal per diem amount over Federal per diem payment amount, the net payment for unbilled or unpaid a 3-year period. including the DRG adjustment and other covered services. Recoupment of an accelerated payment would be made as B. New Providers patient-level and facility-level adjustments appropriate to the claim. bills are processed or by direct payment We believe that we need to propose a by the IPF. D. Periodic Interim Payments (PIP) definition of a new IPF because new E. Limitation on Beneficiaries Charges IPFs will not participate in the 3-year Under the TEFRA payment system— In accordance with § 409.82 and transition from cost-based (1) a psychiatric hospital may be paid § 409.83 and consistent with other reimbursement to a prospective using the PIP method as specified in established prospective payment payment system (section IV.A. of this § 413.64(h); (2) psychiatric units are systems policies, we are proposing in proposed rule). The transition period paid under the PIP method if the § 412.404(c) that an IPF may not charge described is intended to provide hospital of which they are a part is paid as specified in § 412.116(b); and (3) an a beneficiary for any service for which currently existing IPFs time to adjust to payment is made by Medicare. This payment under the new system. A new IPF may be eligible to receive accelerated payments as specified in policy will apply, even if the IPF’s costs IPF would not have received payment of furnishing services to that beneficiary under TEFRA for the delivery of IPF § 413.64(g) or for psychiatric units specified in § 412.116(f). We are are greater than the amount the IPF services before the effective date of the would be paid under the proposed IPF IPF prospective payment system. We do proposing in § 412.432 to continue to allow for PIP and accelerated payment prospective payment system. In not believe that new IPFs require a addition, we are proposing that an IPF transition period in order to make methods under the proposed IPF prospective payment system. receiving a prospective payment for a adjustments to their operating and covered hospital stay (that is, a stay that capital financing, as will IPFs that have In addition, we are proposing that an IPF receiving prospective payments, includes at least one covered day) may been paid under TEFRA, or need to charge the Medicare beneficiary or other otherwise integrate the effects of whether or not it received a PIP under cost reimbursement, may receive a PIP person only for the applicable changing from one payment system to deductible and coinsurance amounts as another payment system. if it meets the requirements specified in proposed § 412.432(b)(1) and receives specified in § 409.82, § 409.83, § 409.87, For purposes of Medicare payment approval by its intermediary. If an and § 489.20. under the proposed IPF prospective intermediary determines that an IPF, V. Future Updates payment system, we are defining a new which received a PIP under cost IPF as a provider of inpatient reimbursement, is no longer entitled to A. Proposed Annual Update Strategy psychiatric hospital services that receive a PIP, it will remove the IPF Section 124 of Pub. L. 106–113 does otherwise meets the qualifying criteria from the PIP method. As specified in not specify an update strategy for the for IPFs, set forth in § 412.22, § 412.23, proposed § 412.432(b)(1), intermediary proposed IPF prospective payment § 412.25, and § 412.27 under present or approval of a PIP is conditioned upon system and is broadly written to give the previous ownership (or both), and its the intermediary’s best judgment as to Secretary a tremendous amount of first cost reporting period as an IPF whether payment can be made under discretion in proposing an update begins on or after April 1, 2004, the the PIP method without undue risk of methodology. Therefore, we reviewed proposed implementation date of the its resulting in an overpayment to the the update approach used in other IPF prospective payment system. provider. hospital prospective payment systems

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66943

(specifically, the IRF and LTCH such as productivity, intensity, new prospective payment system in the prospective payment system technology, and changes in practice future. methodologies). As a result of this patterns. Approximately two-thirds of the analysis, we are proposing the following direct expense for providing inpatient B. Update of the ICD Codes and DRGs strategy for updating the IPF prospective psychiatric services is captured in the payment system: (1) Use the FY 2000 In the health care industry, annual routine cost category of the Medicare bills and cost report data, and the most changes to the ICD–9–CM codes and the cost report. After the allocation of current ICD–9–CM codes and DRGs, DRGs used in the hospital inpatient overhead, this category represents 88 when we issue the IPF prospective prospective payment system are percent of the cost presently being  payment system final rule; (2) effective for discharges occurring on or reimbursed. The RTI International implement the system effective for cost after October 1 of each year. Changes in project will collect patient-level and reporting periods beginning on or after ICD–9–CM codes and composition of facility-level data from a small sample April 1, 2004; and (3) update the the DRGs are presented in the hospital of psychiatric hospitals and psychiatric Federal per diem base rate on July 1, inpatient prospective payment system units nationwide. These data will 2005, since a July 1 update coincides proposed rule published in the Federal provide information on the extent to with more hospital cost reporting cycles Register in the spring of each year. We which variation in the per diem cost and would be administratively easier to are proposing that through the hospital across facilities can be explained by the manage. This means that the first year inpatient prospective payment system differences in the mix of services and of the proposed Federal per diem base staffing that characterize their modes of proposed rule, we would notify IPFs of  rate would be the 15-month period any revised ICD–9–CM codes or practice. RTI International will also April 1, 2004 to June 30, 2005. proposed DRG modifications that would analyze the links among costs, practice We believe it is important to delay become effective on October 1 of that mode, and patient characteristics. updating the adjustment factors until year if finalized. As noted earlier, all a. Mode of Practice the IPF data includes as much health care providers are required to information as possible regarding the The mode of practice can be defined used the updated ICD–9–CM codes on by treatment modality (services patient-level characteristics of the or after October 1 of each year. population that each IPF serves. For this delivered) and by staffing levels. To reason, we do not intend to update the Under the IPF prospective payment analyze the mode of practice, RTI regression and recalculate the proposed system, we are proposing to establish a International first developed a Federal per diem base rate until we have base rate and provide for adjustments to typology of therapeutic services analyzed 1 complete year of data under the rate, including adjustments to reflect (activities) provided in inpatient the IPF prospective payment system, the DRG assigned to the patient’s settings. The services range from labor- that is, no earlier than July 1, 2007. We principal diagnosis and the comorbidity intensive activities (one-on-one intake note that the ability of a regression category for certain secondary or tertiary assessments and evaluations), to less analysis to appropriately identify diagnoses. These adjustments would be labor-intensive activities (therapies). In variation in costs is dependent upon driven by the ICD–9–CM codes addition, RTI International developed continued submission of claims and provided on the IPF’s claims. a classification of psychiatric labor cost reports that are as accurate and For this reason, we urge IPFs to resources that could be used to depict complete as possible. Until that analysis review the hospital inpatient different staffing models. The RTI is complete, we are proposing to publish prospective payment proposed rule to International used these typologies to a notice each spring that would do the determine if any changes have been organize the collection of service and following: made to the ICD–9–CM codes or are staffing data within the sampled • Update the Federal per diem base being proposed in the composition of psychiatric facilities. The RTI rate using the excluded hospital with the 15 DRGs we are proposing to International study hypothesized that capital market basket increase in order recognize under the IPF prospective lower cost facilities use lower cost to reflect the price of goods and services payment system. In the event that practice modalities that can result from used by IPFs. occurs, we would explain in the either the use of lower cost labor or • Apply the most current hospital hospital inpatient prospective payment lower cost treatment methods. wage index with an adjustment factor to system rules how the change would be b. Patient Characteristics the Federal per diem base rate to ensure handled under the IPF prospective that aggregate payments to IPFs are not payment system for claims on or after To link the mode of practice with affected by an updated wage index. October 1 of each year. patient characteristics, modality must be • Update the fixed dollar loss collected at the patient level. Resource threshold to maintain an outlier C. Future Refinements usage can be defined by estimating the percentage that is 2 percent of total 1. RTI International type and cost of staff involved with estimated IPF payments. providing patient care. This can be • Describe the impact of the ICD–9– We have contracted with RTI accomplished by linking each patient’s CM coding changes discussed in the International to examine the extent to activity with the time spent by each hospital inpatient prospective payment which modes of practice and staffing staffing type for an activity with the system proposed rule that would effect patterns explain the per diem cost average wage rate for that staff. Adding the proposed IPF prospective payment differences among the various types of the cost of each activity over a 24-hour system. IPF facilities (private psychiatric period determines the per diem resource In the future, we may propose an hospitals, psychiatric units, and cost for a patient. These per diem costs update methodology for the IPF government hospitals). In addition, RTI can then be compared and linked with prospective payment system that would International will analyze the extent to patient characteristics in order to be based on the excluded hospital with which the different types of facilities explain resource use. capital market basket index along with treat different types of patients. We The RTI International used patient other appropriate adjustment factors anticipate that this study may assist us characteristics that were available from relevant to psychiatric service delivery in proposing refinements to the claims data (age and diagnoses).

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00025 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66944 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

However, other variables are not groups. This input included mental diagnosis to predict differences in the collected on claims (Global Assessment health professionals with experience in length of stay. The study led to a further of Functioning scores and functional both payment methodology and effort (Fries, et al., 1990), which resulted deficits, such as, activities of daily assessment instruments. The tool would in the development of a classification living). This limited set of candidate collect information on the patient system for long stay Veterans variables was selected with input from characteristics, clinical characteristics, Administration’s psychiatric patients RTI International’s technical functional status, services, and (length of stay greater than 100 days). evaluation panel. We will continue to treatments. This research was the first to consider investigate the functional status, and we The information that would be which characteristics could explain are soliciting comments specifically on collected in the CMAT is available in measured resource use for chronic this issue. the patient’s medical record and psychiatric residents. Those treatment plans. We do not believe that c. Analysis characteristics included a broad completing the assessment tool would assessment of patients’ medical Using a cluster analysis technique, require additional data collection on the conditions, functional status, mental  RTI International will attempt to part of the clinical staff. We have deficits, treatments, as well as the direct develop an index that could be highly assumed that in addition to the medical measurement of daily staff time spent predictive of resource use among the record, a team of clinical staff provides with each patient. Using only six patient resulting psychiatric patient services and treatment to these patients, categories developed from these classification categories. including but not limited to nurses,  variables, the resulting long-stay The RTI International is also psychiatric nurses, physicians, clinical classification system (PPCs) explained investigating whether a more refined psychologists, social workers, 11.4 percent of the variability in per payment model is possible. Such a psychiatrists, and rehabilitation, diem resource use. While this number model might reduce the need for a physical, and speech therapists. To seems low, the Ashcraft and Fries sophisticated psychiatric patient reduce both the complexity of the Veterans Administration’s studies were classification system. Currently, data are information collection process and the the first to offer a patient assessment being collected for a 7-day period to burden, the instrument would be instrument approach for the analyze the change in resources over completed at discharge. We are construction of case mix measures time. This study will allow a test of a requesting comments on the availability potentially useful in an IPF prospective hypothesis advocated by Frank, R.G., of the information to complete this payment system. and Lave, HR. (1986). Journal of Human instrument. Resources, 21(3): (321–337). They In order to collect information in the VI. Provisions of the Proposed Rule suggested that when using a per diem most efficient manner possible, the We are proposing to make a number rate that declines with the length of CMAT would be automated. This of revisions to the regulations in order stay, the rate would be higher at the approach would shorten the time to to implement the proposed prospective beginning of the stay to cover the higher complete the instrument and simplify payment system for IPFs. Specifically, costs associated with admission, and the input process. Upon completion, the we are proposing to make conforming decline over time as treatment achieved instrument would be transmitted to us. changes in 42 CFR parts 412 and 413. stabilization of the patient’s condition. We would develop and provide the software to perform the transmission to We would establish a new subpart N in 2. University of Michigan Research IPFs at no cost. In addition, we would part 412, ‘‘Prospective Payment System We are also currently contracting with provide training and manuals to for Hospital Inpatient Services of the University of Michigan’s Public facilitate both the transmission process Psychiatric Facilities.’’ This subpart Health Institute to conduct research to and the completion of the assessment would implement section 124 of the assist us in developing a patient tool. BBRA, which requires the classification system based on a Finally, once the instrument has been implementation of a per diem standard assessment tool. We believe pilot-tested and the instrument reflects prospective payment system for IPFs. that additional patient level information changes resulting from this testing, we This subpart would set forth the such as patient functioning and patient would pursue clearance by the Office of framework for the proposed IPF resource use is necessary to augment Management and Budget (OMB). A prospective payment system, including our administrative data and would detailed OMB information collection the methodology used for the result in a more equitable and accurate package will be prepared and available development of the payment rates and payment system. We are in the early for public comment. The package will related rules. These proposed revisions stages of developing a preliminary tool, include delineation of the technical and others are discussed in detail the Case Mix Assessment Tool (CMAT) evaluation panel membership, below. instrument. We have attached a draft comments on specific items in the Section 412.1 Scope of Part copy to this proposed rule for review instrument, justifications for including and comment (see Addendum C.). selected questions (for example, We propose to revise § 412.1 by We believe that this assessment tool activities of daily living), and the redesignating paragraphs (a)(2) and would collect minimal but necessary scaling for individual items. In addition, (a)(3) as paragraphs (a)(3) and (a)(4). information. The draft instrument the OMB package will contain manuals We propose to add a new paragraph contains 36 questions. Each item in the and training material that support the (a)(2) that would specify that this part draft assessment tool resulted from the instrument. Any comments on this implements section 124 of Pub. L. 106– University of Michigan’s evaluation of preliminary draft instrument will assist 113 by establishing a per diem based existing instruments and clinical scales. us in developing a potential instrument. prospective payment system for It reflects the input and feedback to the inpatient operating and capital costs of contractor of both the technical 3. Case-Mix Tool hospital inpatient services furnished to evaluation panel and mental health The Ashcraft study used a patient Medicare beneficiaries by a psychiatric associations as well as related assessment instrument to develop facility that meets the conditions of psychological and psychiatric industry additional variables beyond psychiatric subpart N.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66945

We propose to revise § 412.1 by We propose to amend § 412.27(a) by ++ Withhold (in full or in part) or redesignating paragraphs (b)(12) and removing the words the ‘‘Third reduce payment to the IPF until the (b)(13) as paragraphs (b)(13) and (b)(14). Edition,’’ and adding in its place, facility provides adequate assurances of We propose to add a new paragraph ‘‘Fourth Edition, Text Revision.’’ compliance; or (b)(12) that would summarize the ++ Classify the IPF as an hospital Section 412.116 Method of Payment content of the new subpart N which sets subject to the hospital inpatient forth the general methodology for We propose to revise § 412.116 by prospective payment system. paying operating and capital costs for redesignating paragraphs (a)(3) and In proposed paragraph (b), we would inpatient psychiatric facilities effective (a)(4) as paragraphs (a)(4) and (a)(5). specify that, subject to the special with cost reporting periods beginning We propose to add a new paragraph payment provisions of § 412.22(c), an on or after April 1, 2004. (a)(3) that would specify the cost inpatient psychiatric facility must meet reporting period to which the proposed the general criteria set forth in § 412.22. Section 412.20 Hospital Services IPF prospective payment system applies For exclusion from the hospital Subject to the Prospective Payment and how payments for inpatient inpatient prospective payment system Systems psychiatric services are made to a as specified in § 412.1(a)(1), a We propose to amend § 412.20(a) by qualified IPF. psychiatric hospital must meet the adding a reference to IPFs. criteria set forth in § 412.23(a) and Subpart N—Prospective Payment We propose to revise § 412.20 by psychiatric units must meet the criteria System for Hospital Inpatient Services redesignating paragraphs (b), (c), and set forth in § 412.25 and § 412.27. of Psychiatric Facilities (d), as paragraphs (c), (d), and (e). In proposed paragraph (c), we would We propose to add a new paragraph We propose to add a new subpart N specify the prohibited and permitted (b) that would indicate that effective for as follows: charges that may be imposed on cost reporting periods beginning on or Section 412.400 Basis and Scope of Medicare beneficiaries. In proposed paragraph (c)(1), we after April 1, 2004, covered hospital Subpart inpatient services furnished by a would specify that an IPF may not psychiatric facility as specified in We are proposing to add a new charge the beneficiary for any services § 412.404 of subpart N are paid under section § 412.400. In § 412.400(a), we which payment is made by Medicare, the prospective payment system. would provide the requirements for the even if the IPFs costs are greater than implementation of a prospective the amount the facility is paid under the Section 412.22 Excluded Hospitals payment system for IPFs. IPF prospective payment system. and Hospital Units: General Rules In proposed § 412.400(b), we would In proposed paragraph (c)(2), we We propose to amend § 412.22(b) by specify that this subpart sets forth the would specify that an IPF receiving revising paragraph (b) to state that framework for the prospective payment payment for a covered stay may charge except for those hospitals specified in system, including the methodology used the Medicare beneficiary or other person paragraph (c) of this section, and for the development of payment rates for only the applicable deductible and § 412.20(b), (c), and (d), all excluded and associated adjustments, the coinsurance amounts under § 409.82, hospitals (and excluded hospital units, application of a transition period, and § 409.83, and § 409.87. as described in § 412.23 through the related rules for IPFs for cost In proposed paragraph (d), we would § 412.29) are reimbursed under the cost reporting periods beginning on or after specify the following provisions for reimbursement rules set forth in part April 1, 2004. furnishing IPF services directly or under arrangement: 413 of this chapter, and are subject to Section 412.402 Definitions the ceiling on the rate of hospital cost • Applicable payments made under increases as specified in § 413.40. In § 412.402, we are proposing to the IPF prospective payment system are define the following terms for purposes considered payment in full for all Section 412.23 Excluded Hospitals: of this new subpart: hospital inpatient services (as defined in Classifications • Comorbidity. § 409.10) other than physicians’ services We propose to revise § 412.23 by • Fixed dollar loss threshold. to individual patients (as specified in redesignating paragraphs (a)(1) and • Inpatient psychiatric facilities. § 415.102(a)) that are reimbursed on a (a)(2) as paragraphs (a)(2) and (a)(3). • Interrupted stay. fee schedule basis. We propose to add a new paragraph • Outlier payment. • Hospital inpatient services do not (a)(1) that would specify the • Per diem payment amount. include physician, physician assistant, requirements a psychiatric hospital • Principal diagnosis. nurse practitioner, clinical nurse must meet in order to be excluded from • Rural area. specialist, certified nurse midwives, • reimbursement under the prospective Urban area. qualified psychologist, and certified payment system as specified in registered nurse anesthetist services. Section 412.404 Conditions for • § 412.1(a)(1) and to be paid under the Payment Under the Prospective Payment is not made to a provider IPF prospective payment system as Payment System for Hospital Inpatient or supplier other than the IPF, except specified in § 412.1(a)(2). Services of Psychiatric Facilities for services provided by a physician, physician assistant, nurse practitioner, Section 412.25 Excluded Hospital In proposed § 412.404(a), we would clinical nurse specialist, certified nurse Units: Common Requirements specify that IPFs must meet the midwives, qualified psychologist, and We propose to amend § 412.25(a) by following general requirements to certified registered nurse anesthetist. adding a reference to § 412.1(a)(2). receive payment under the IPF • The IPF must furnish all necessary prospective payment system: covered services to the Medicare Section 412.27 Excluded Psychiatric • The IPF must meet the conditions beneficiary directly or under Units: Additional Requirements as specified in this subpart. arrangement (as defined in § 409.3). We propose to amend the • If the IPF fails to comply fully with In proposed paragraph (e), we would introductory text of § 412.27 by adding the provisions of this part then the specify that IPFs must meet the the reference to § 412.1(a)(1) and (a)(2). following are applicable— recordkeeping and cost reporting

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66946 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

requirements of § 412.27(c), § 413.20, Section 412.426 Transition Period paragraphs (d)(2)(vi), (d)(2)(vii), and § 413.24. In proposed § 412.426(a), we would (d)(2)(viii), and (d)(2)(ix). Section 412.422 Basis of Payment specify the duration of the transition We propose to add a new paragraph period to the IPF prospective payment (iv) that would specify that for cost In proposed § 412.422(a), we would system. In addition, we would specify reporting periods beginning before April specify that under the prospective that IPFs would receive a payment that 1, 2004, payment to psychiatric payment system, IPFs would receive a is a blend of the Federal per diem hospitals (as well as separate psychiatric predetermined per diem amount, payment amount and the facility- units of short-term general hospitals) adjusted for patient characteristics and specific payment amount the IPF would that are excluded under subpart B of facility characteristics, for inpatient receive under the TEFRA payment part 412 of this chapter from the services furnished to Medicare methodology. prospective payment system is on a beneficiaries. In addition, we would In proposed paragraph (b), we would reasonable cost basis, subject to the specify that during the transition period, specify how the facility-specific provisions of § 413.40. payment would be based on a blend of payment amount is calculated. We propose to add a new paragraph the Federal per diem payment amount In proposed paragraph (c), we would and the facility-specific payment rate. (v) that would specify that for cost specify that new IPFs, that is, facilities reporting periods beginning on or after In proposed § 412.422(b), we would that under present or previous specify that payments made under the April 1, 2004, payment to psychiatric ownership, or both, have its first cost hospitals (as well as separate psychiatric prospective payment system represent reporting period as an IPF beginning on payment in full for inpatient operating units of short-term general hospitals) or after April 1, 2004, are paid the full that meet the conditions of § 412.404 of and capital-related costs associated with Federal per diem rate. services furnished in an IPF but not for this chapter is based on prospectively the cost of an approved medical Section 412.428 Publication of the determined rates under subpart N of education program described in § 413.85 Federal Per Diem Payment Rates part 412. and § 413.86 and for bad debts of In proposed § 412.428, we would Section 413.40 Ceiling on the Rate of Medicare beneficiaries as specified in specify how we plan to publish Increase in Hospital Costs § 413.80. information each year in the Federal Section 412.424 Methodology for Register to update the IPF prospective Section 413.40(a)(2)(i) specifies the Calculating the Federal Per Diem payment system. types of facilities to which the ceiling Payment Rate on the rate of increase in hospital Section 412.432 Method of Payment inpatient costs is not applicable. In proposed § 412.424, we would Under the Inpatient Psychiatric Facility We propose to revise § 413.40(a)(2)(i) specify the methodology for calculating Prospective Payment System by redesignating paragraphs (a)(2)(i)(C) the Federal per diem payment rate for In proposed § 412.432, we would and (a)(2)(i)(D) as paragraphs (a)(2)(i)(D) IPFs. specify the following method of and (a)(2)(i)(E). In proposed paragraph (a), we would payment used under the IPF prospective specify the data sources used to payment system: We propose to add a new paragraph (C) to § 413.40 to clarify that § 413.40 is calculate the prospective payment rate. • General rules for receiving payment. not applicable to psychiatric hospitals In proposed paragraph (b), we would • Periodic interim payments and psychiatric units under subpart N of specify that the methodology used for including— determining the Federal per diem base • Criteria for receiving periodic part 412 of this chapter for cost rate would include the following: interim payments reporting periods beginning on or after • The updated average per diem • Frequency of payments April 1, 2004. amount. • Termination of periodic interim We propose to revise paragraph • The budget-neutrality adjustment payments (a)(2)(ii)(B) to specify the facilities to factor. • Interim payment for Medicare bad which the ceiling applies for cost In proposed paragraph (c), we would debts and for costs not paid under the reporting periods beginning on or after specify that the Federal per diem prospective payment system and October 1, 1983 through March 31, payment amount for IPFs would be the other costs paid outside the 2004. product of the Federal per diem base prospective payment system. We propose to revise paragraph • rate, the facility-level adjustments, and Outlier payments. (a)(2)(iii) by redesignating paragraphs • the patient-level adjustments applicable Accelerated payments including— (a)(2)(iii) and (a)(2)(iv) as paragraphs • to the case as described below: General rule for requesting (a)(2)(iv) and (a)(2)(v). • Facility-level adjustments include: accelerated payments • • Approval of accelerated payments We propose to add a new paragraph Adjustment for wages (a)(2)(iii) that would specify psychiatric • • Amount of the accelerated payment Location in rural areas • facilities are excluded from the • Teaching status Recovery of the accelerated payment prospective payment system as • Patient-level adjustments include: specified in § 412.1(a)(1) and paid under • Age Section 413.1 Introduction § 412.1(a)(2) for cost reporting periods • Principal diagnosis We propose to amend § 413.1(d)(2)(ii) beginning on or after April 1, 2004. • Comorbodities by removing the words ‘‘psychiatric • Section 413.64 Payment to Providers: Variable per diem adjustments hospitals (as well as separate psychiatric Special Rules • Adjustment for high-cost outlier units (distinct parts) of short-term cases general hospitals).’’ We propose to amend § 413.64(h)(2)(i) In proposed paragraph (d), we would We propose to revise § 413.1 by by adding a reference to hospitals paid specify the special payment provisions redesignating paragraphs (d)(2)(iv), under the IPF prospective payment for interrupted stays. (d)(2)(v), (d)(2)(vi), and (d)(2)(vii) as system.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66947

Section 424.14 Requirements for effects, distributive impacts, and definitions described above, we estimate Inpatient Services of Psychiatric equity). A regulatory impact analysis the combined impact of the proposed Hospitals (RIA) must be prepared for major rules rule would be a 1-percent increase in We propose to amend § 424.14 by with economically significant effects payments relative to their payments adding a new paragraph (c)(3) to state ($100 million or more in any 1 year). under TEFRA. This estimated impact that for recertification a physician must Based on analysis of the aggregate dollar does not meet the threshold established indicate that the patient continues to impacts for each of the different facility by HHS to be considered a significant need, on a daily basis, inpatient types, we have determined that the re- impact. Nonetheless, we have prepared psychiatric care (furnished directly by distributive impact among facility types the following analysis to describe the is $78 million. In addition, our analysis or requiring the supervision of inpatient impact of the proposed rule. showed that a payment reduction of $40 psychiatric facility personnel) or other In addition, section 1102(b) of the Act professional services that, as a practical million would occur for psychiatric units and a payment increase of $10 requires us to prepare a regulatory matter, can be provided only on a million would occur for-profit hospitals, impact analysis if a rule may have a inpatient basis. significant impact on the operations of We propose to amend § 424.14(d)(2) $26 million for government hospitals, by removing the word ‘‘18th day of and $2 million for non-profit hospitals. a substantial number of small rural hospitalization’’ and replacing it with Therefore, we have determined that this hospitals. This analysis must conform to ‘‘10th day of hospitalization.’’ proposed rule would not be a major rule the provisions of section 603 of the within the meaning of Executive Order RFA. For purposes of section 1102(b) of VII. Collection of Information 12866 because the redistributive effects the Act, we define a small rural hospital Requirements do not constitute a shift of $100 million as a hospital that is located outside of These regulations do not impose any in any 1 year. In addition, because the an MSA and has fewer than 100 beds. new information collection proposed IPF prospective payment We have determined that this proposed requirements. The burden of the system must be budget neutral in rule would have a substantial impact on requirements in § 412.404(e), reporting accordance with section 124(a)(1) of hospitals classified as located in rural and recordkeeping requirements, are Pub. L. 106–113, we estimate that there areas. As discussed earlier in this captured in the burden for the cross- will be no budgetary impact for the preamble, we are proposing to adjust Medicare program (section IX.B.6. of referenced § 412.27(c), § 413.20, and payments by 16 percent for IPFs located this proposed rule). § 413.24 under OMB approval numbers in rural areas. In addition, we are 0938–0301, 0938–0500, 0938–0358, and The RFA requires agencies to analyze options for regulatory relief of small proposing a 3-year transition to the new 0938–0600. businesses. For purposes of the RFA, system to allow IPFs an opportunity to VIII. Response to Comments small entities include small businesses, adjust to the new system. Therefore, the nonprofit organizations, and impacts shown in Table 8 below reflect Because of the large number of items the adjustments that are designed to of correspondence we normally receive government agencies. Most hospitals minimize or eliminate the negative on Federal Register documents and most other providers and suppliers impact that the proposed IPF published for comment, we are not able are small entities, either by nonprofit prospective payment may otherwise to acknowledge or respond to them status or by having revenues of $29 individually. We will consider all million or less in any 1 year. Medicare have on small rural IPFs. comments we receive by the date and fiscal intermediaries are not considered Section 202 of the UMRA also time specified in the DATES section of to be small entities. Individuals and requires that agencies assess anticipated this proposed rule, and, if we proceed States are not included in the definition costs and benefits before issuing any with a subsequent document, we will of a small entity. proposed rule that may result in HHS considers that a substantial respond to the major comments in the expenditures in any 1 year by State, number of entities are affected if the preamble to that document. local, or tribal governments, in the rule impacts more than 5 percent of the IX. Regulatory Impact Statement total number of small entities as it does aggregate, or by the private sector, of in this rule. We included all $110 million or more. This proposed A. Overall Impact freestanding psychiatric hospitals (88 rule does not mandate any requirements We have examined the impact of this are nonprofit hospitals) in the analysis for State, local, or tribal governments proposed rule as required by Executive since their total revenues do not exceed nor would it result in expenditures by Order 12866 (September 1993, the $29 million threshold. We also the private sector of $110 million or Regulatory Planning and Review), the included small psychiatric units as well more in any 1 year. Regulatory Flexibility Act (RFA) as psychiatric units of small hospitals, Executive Order 13132 establishes (September 16, 1980, Pub. L. 96–354), that is, fewer than 100 beds. We did not certain requirements that an agency section 1102(b) of the Act, the include psychiatric units within larger must meet when it promulgates a Unfunded Mandates Reform Act of 1995 hospitals in the analysis because we proposed rule (and subsequent final (UMRA) (Pub. L. 104–4), and Executive believe this proposed rule would not rule) that imposes substantial direct Order 13132). significantly impact total revenues of requirement costs on State and local Executive Order 12866 (as amended the entire hospital that supports the governments, preempts State law, or by Executive Order 13258, which unit. We have provided the following otherwise has Federalism implications. merely reassigns responsibility of RFA analysis in section B, to emphasize duties) directs agencies to assess all that although the proposed rule would We have examined this proposed rule costs and benefits of available regulatory impact a substantial number of IPFs that under the criteria set forth in Executive alternatives and, if regulation is were identified as small entities, we do Order 13132 and have determined that necessary, to select regulatory not believe it would have a significant this proposed rule will not have any approaches that maximize net benefits economic impact. Based on the analysis negative impact on the rights, roles, and (including potential economic, of the 917 psychiatric facilities that responsibilities of State, local, or tribal environmental, public health and safety were classified as small entities by the governments or preempt State law.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66948 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

B. Anticipated Effects payments under the proposed IPF provided in section III.C. of this Below, we discuss the impact of this prospective payment system. The IPFs proposed rule. proposed rule on the Federal Medicare were grouped into the categories listed The impacts reflect the estimated budget and on IPFs. below based on characteristics provided ‘‘losses’’ or ‘‘gains’’ among the various in the Online Survey and Certification 1. Budgetary Impact classifications of IPF providers for the and Reporting (OSCAR) file and the first year of the proposed IPF Section 124(a)(1) of Pub. L. 106–113 1999 cost report data from HCRIS: prospective payment system. Proposed requires us to set the payment rates • Facility Type prospective payments were based on the contained in this proposed rule to • Location proposed budget-neutral Federal per ensure that total payments under the • Teaching Status diem base rate of $530 adjusted by the IPF prospective payment system are • Census Region IPFs’ estimated patient-level, facility- projected to equal the amount that • Size level adjustments, and simulated outlier would have been paid if this proposed To estimate the impacts among the amounts. This payment was compared prospective payment system had not to the IPF’s payments based on its cost been implemented. As a result of this various categories of IPFs, we had to compare estimated future payments that from the cost report inflated to the analysis, which is discussed in section midpoint of the effective period (April III of this proposed rule, we are would have been made under the TEFRA payment methodology to 1, 2004 through June 30, 2005) and proposing a budget-neutrality subject to the updated per discharge adjustment to the Federal per diem base estimated payments under the proposed target amount. rate. Thus, there will be no budgetary IPF prospective payment system. We impact to the Medicare program by estimated the impacts using the same Table 8 below illustrates the aggregate implementation of the proposed IPF set of providers (1,975 IPFs) that was impact of the proposed IPF prospective prospective payment system. used for the regression analysis to payment system on various calculate the budget-neutral Federal per classifications of IPFs. The first column 2. Impacts on Providers diem base rate, and to determine the identifies the type of IPF, the second To understand the impact of the appropriateness of various adjustments column indicates the number of IPFs for proposed IPF prospective payment to the Federal per diem base rate. A each type of IPF, and the third column system on providers, it is necessary to detailed explanation of the methods we indicates the ratio of the proposed IPF estimate payments that would be made used to simulate TEFRA payments and prospective payment system payments under the current TEFRA payment estimated payments under the proposed to the current TEFRA payments in the methodology (current payments) and IPF prospective payment system is first year of the transition.

TABLE 8.—AGGREGATE IMPACT

Ratio of pro- posed pro- spective pay- Facility by type Number of fa- ment amount cilities to TEFRA pay- ment with tran- sition

All Facilities ...... 1975 1.00 By Type of Ownership: Psychiatric Hospitals Government ...... 181 1.14 Non-profit ...... 88 1.01 For-profit ...... 236 1.02 Psychiatric Units ...... 1470 0.99 All Facilities ...... 1975 1.00 Rural ...... 445 0.99 Urban ...... 1530 1.00 By Urban or Rural Classification: Urban by Facility Type ...... Psychiatric Hospitals: Government ...... 138 1.14 Non-profit ...... 80 1.01 For-profit ...... 221 1.02 Psychiatric Units ...... 1091 0.99 Rural by Facility Type: Psychiatric Hospitals: Government ...... 43 1.14 Non-profit ...... 8 0.99 For-profit ...... 15 1.02 Psychiatric Units ...... 379 0.98 By Teaching Status: Non-teaching ...... 1676 0.99 Less than 10% interns and residents to beds ...... 163 1.02 10% to 30% interns and residents to beds ...... 80 1.02 More than 30% interns and residents to beds ...... 56 1.03 By Region: New England ...... 128 0.99 Mid-Atlantic ...... 316 1.04

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66949

TABLE 8.—AGGREGATE IMPACT—Continued

Ratio of pro- posed pro- spective pay- Facility by type Number of fa- ment amount cilities to TEFRA pay- ment with tran- sition

South Atlantic ...... 283 1.00 East North Central ...... 369 0.98 East South Central ...... 161 0.99 West North Central ...... 174 0.99 West South Central ...... 270 0.97 Mountain ...... 88 1.00 Pacific ...... 181 1.00 By Bed Size: Psychiatric Hospitals: Under 10 beds ...... 2 0.99 10 to 25 beds ...... 36 0.99 25 to 50 beds ...... 71 1.01 50 to 100 beds ...... 199 1.02 100 to 200 beds ...... 127 1.05 200 to 400 beds ...... 49 1.10 Over 400 beds ...... 21 1.19 Psychiatric Units ...... Under 10 beds ...... 55 0.96 10 to 25 beds ...... 749 0.97 25 to 50 beds ...... 443 0.98 50 to 100 beds ...... 184 1.00 100 to 200 beds ...... 32 1.02 200 to beds 400 ...... 6 1.07 Over 400 beds ...... 1 1.12

3. Results prospective payment to the current residents to average daily census; and TEFRA payment ratio of 1.01 and 1.02, (4) more than 30 percent of interns and We measured the impact of the respectively. residents to average daily census. proposed IPF prospective payment Facilities that are classified with a b. Location system by comparing proposed teaching ratio greater than 0 percent payments under the IPF prospective Approximately 23 percent of all IPFs would benefit under the proposed IPF payment system relative to current are located in rural areas. The impact prospective payment system. TEFRA payments. This was computed analysis in Table 8 indicates that under as a ratio of the proposed prospective the proposed IPF prospective payment d. Census Region payment to the current TEFRA payment system, the proposed prospective Under the proposed IPF prospective for each classification of IPF. We have payment to the current TEFRA payment payment system, IPFs in the Mid- prepared the following summary of the ratio would be approximately 0.99 for Atlantic region would receive a higher impact of the proposed IPF prospective rural IPFs and 1.00 for urban IPFs. If we payment ratio of approximately 1.04. payment system set forth in this grouped all of the IPFs by facility type IPFs in other regions would receive proposed rule. within urban and rural locations, the payment ratios between approximately a. Facility type impact analysis would indicate that the 0.97 and 1.00. Specifically, the South estimated proposed prospective Atlantic States, the Mountain States, We grouped the IPFs into the payment to current TEFRA payment and the Pacific States would receive following four categories: (1) Psychiatric ratios would be between approximately payment ratios of 1.00. The New units; (2) government hospitals; (3) for- 0.98 and 1.02 for all IPFs except England States, East South Central profit hospitals; and (4) non-profit government hospitals. Under the States, and the West North Central hospitals. Roughly 75 percent of all IPFs proposed IPF prospective payment States, would receive payment ratios of are psychiatric units. The impact system, the payment ratios for rural and approximately 0.99. The proposed IPF analysis in Table 8 indicates that under urban government hospitals are both prospective payments would be slightly the proposed IPF prospective payment estimated to be approximately 1.14. lower than 0.99 for IPFs in the West system, freestanding psychiatric South Central and East North Central c. Teaching Status hospitals would receive an increase States. relative to the current payment. The Using the ratio of interns and psychiatric units would have a residents to the average daily census for e. Size proposed prospective payment to the each facility as a measure of the We grouped the IPFs into 7 categories current TEFRA payment ratio of 0.99, magnitude of the teaching status, we for each group of psychiatric facilities the government hospitals would have a grouped facilities into the following four based on bed size: (1) Under 10 beds; (2) proposed prospective payment to the major categories: (1) non teaching; (2) 10 to 25 beds; (3) 25 to 50 beds; (4) 50 current TEFRA payment ratio of 1.14, less than 10 percent ratio of interns and to 100 beds; (5) 100 to 200 beds; (6) 200 and the non-profit and for-profit residents to average daily census; (3) 10 to 400 beds; and (7) over 400 beds. hospitals would have a proposed to 30 percent ratio of interns and Under the proposed IPF prospective

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66950 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

payment system, the payment ratios for to analyze claims and cost report data percent of hospital inpatient claims are all bed size categories would be greater from the first year of the prospective submitted electronically. In addition, than 0.96. The majority of IPFs’ bed payment system to determine whether we are not proposing any significant sizes were categories in which the the factors used to develop the Federal changes in claims processing (see payment ratio would be greater than per diem base rate are not significantly section IVC. of this proposed rule). different from the actual results 0.98. Under the proposed IPF C. Alternatives Considered prospective payment system, large IPFs experienced in that year. We are with over 400 beds would receive the planning to compare payments under We considered the following highest payment ratio (1.19 percent for the final Federal per diem rate (which alternatives in developing the proposed relies on an estimate of cost-base TEFRA IPF prospective payment system: psychiatric hospitals and 1.12 for • psychiatric units), while psychiatric payments using historical data from a One option we considered units with less than 10 beds would base year and assumptions that trend incorporated not only the patient-level receive the lowest payment ratio of 0.96. the data to the initial year of and facility-level variables described implementation) to estimated cost-based previously, but also a site-of-service 4. Effect on the Medicare Program TEFRA payments based on actual data distinction. Under this approach, Based on actuarial projections from the first year of the IPF prospective psychiatric units would have received a resulting from our experience with other payment system. The percent difference higher per diem payment, all other prospective payment systems, we (either positive or negative) would be factors being equal, based on the estimate that Medicare spending (total applied prospectively to the established assumption that psychiatric units on Medicare program payments) for IPF prospective payment rates to ensure the average treat a more complex and costly services over the next 5 years would be rates accurately reflect the payment case-mix. A psychiatric unit adjustment as follows: levels intended by the statute. We to the otherwise applicable per diem intend to perform this analysis within payment rate would reflect the absence TABLE 9.—ESTIMATED PAYMENTS the first 5 years of the implementation of a more sophisticated patient of the prospective payment system. classification system specifically linked to resource use. Our analysis of the 1999 Fiscal time periods Dollars in Section 124 of Pub. L. 106–113 millions provides the Secretary broad authority cost report and billing data used to in developing the proposed IPF develop this proposed rule reveals that April 1, 2004 to June 30, 2005 5,311 prospective payment system, including an adjustment would have increased the July 1, 2005 to June 30, 2006 4,531 the authority for appropriate otherwise applicable per diem payment July 1, 2006 to June 30, 2007 4,788 to psychiatric units by approximately 33 July 1, 2007 to June 30, 2008 5,053 adjustments. In accordance with this July 1, 2008 to June 30, 2009 5,328 authority, we may make a one-time percent. prospective adjustment to the Federal The average 1999 inpatient These estimates are based on the per diem base rate in an effort to ensure psychiatric per diem cost were $615 for current estimate of increases in the that the best historical data available psychiatric units, $534 for non-profit proposed excluded hospitals with forms the foundation of the prospective hospitals, $448 for proprietary providers, and $378 for governmental capital market basket as follows: payment rates in future years. • facilities. While some of the higher than 3.3 percent for FY 2004; 5. Effect on Beneficiaries • 3.1 percent for FY 2005; average per diem cost in psychiatric • 3.0 percent for FY 2006; Under the proposed IPF prospective units may be due to a greater medical • 2.9 percent for FY 2007; payment system, IPFs would receive and surgical acuity among patients • 3.0 percent for FY 2008; and payment based on the average resources treated in psychiatric units, part of the • 3.0 percent for FY 2009. consumed by patients for each day. We difference is undoubtedly attributable to We estimate that there would be an do not expect changes in the quality of economy of scale inefficiencies increase in fee-for-service Medicare care or access to services for Medicare associated with operating small units, beneficiary enrollment as follows: beneficiaries under the proposed IPF including higher overhead expenses, • 1.8 percent in FY 2004; prospective payment system. In fact, we and generally lower occupancy rates. A • 1.5 percent in FY 2005; believe that access to IPF services would psychiatric unit site-of-service • 1.5 percent in FY 2006; be enhanced due to the proposed distinction in payment rates would • 1.9 percent in FY 2007; adjustment factors for comorbid represent a proxy adjuster in lieu of a • 2.0 percent in FY 2008; and conditions and the proposed outlier more refined classification system. • 1.9 percent in FY 2009. policy, which are intended to Therefore, we are concerned about Consistent with the statutory adequately reimburse IPFs for expensive applying such an adjustment to all requirement for budget neutrality in the cases. In addition, we expect that paying psychiatric units regardless of cost, initial year of implementation, we prospectively for IPF services will efficiency, or case-mix. In addition, no intend for estimated aggregate payments enhance the efficiency of the Medicare other Medicare prospective payment under the proposed IPF prospective program. system has a distinction in payments payment system to equal the estimated solely based on the site of service. aggregate payments that would be made 6. Computer Hardware and Software We strongly believe that payments on if the IPF prospective payment system We do not anticipate that IPFs will behalf of Medicare beneficiaries should were not implemented. Our incur additional systems operating costs reflect the resource needs of patients, methodology for estimating payments in order to effectively participate in the not simply where patients are treated. A for purposes of the budget-neutrality proposed IPF prospective payment higher per diem payment to psychiatric calculations uses the best available data. system. We believe that IPFs possess the units compared to psychiatric hospitals After the proposed IPF prospective computer hardware capability to handle may create powerful incentives to payment system is implemented, we the billing requirements under the increase the number of psychiatric units will evaluate the accuracy of the proposed IPF prospective payment without regard to patient need or acuity. assumptions used to compute the system. Our belief is based on Pending the development of a more budget-neutrality calculation. We intend indications that approximately 99 refined facility-specific case-mix

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66951

system, we believe that the proposed Puerto Rico, Reporting and Subpart B—Hospital Services Subject payment system appropriately recordkeeping requirements. to and Excluded From the Prospective accommodates the higher costs of those Payment Systems for Inpatient 42 CFR Part 413 psychiatric units with a more complex Operating Costs and Inpatient Capital case-mix. The proposed DRG and Health facilities, Kidney diseases, Related Costs comorbidity payment adjustments, the Medicare, Puerto Rico, Reporting and 3. Section 412.20 is amended as proposed 3-year transition period that recordkeeping requirements. would allow a gradual phase-in of the follows: proposed IPF prospective payment 42 CFR Part 424 a. Revising paragraph (a). b. Redesignating paragraphs (b), (c), system, and the proposed outlier Emergency medical services, Health and (d) as paragraphs (c), (d), and (e). payment policy would ensure that those c. Adding a new paragraph (b). psychiatric units with more costly, facilities, Health professions, Medicare, Reporting and recordkeeping. The revision and addition read as resource-intensive cases are not unfairly follows: disadvantaged. For the reasons set forth in the Although the use of a psychiatric unit preamble, the Centers for Medicare & § 412.20 Hospital services subject to the adjustment in connection with the Medicaid Services proposes to amend prospective payment systems. proposed IPF prospective payment 42 CFR chapter IV as follows: (a) Except for services described in system was described in our August 21, paragraphs (b), (c), (d), and (e) of this 2002 Report to the Congress as a PART 412—PROSPECTIVE PAYMENT section, all covered hospital inpatient potential payment option, as discussed SYSTEMS FOR INPATIENT services furnished to beneficiaries in section III.B.2. of this proposed rule, PSYCHIATRIC SERVICES during the subject cost reporting periods we have not adopted this approach. are paid under the prospective payment • Another option we considered was 1. The authority citation for part 412 system as specified in § 412.1(a)(1). a facility model based on the IPF’s continues to read as follows: (b) Effective for cost reporting periods historical payment and patient mix. Authority: Secs. 1102 and 1871 of the beginning on or after April 1, 2004, In order to address the limitation of Social Security Act (42 U.S.C. 1302 and covered hospital inpatient services routine cost data that is discussed in 1395hh). furnished to Medicare beneficiaries by section III.B. of this proposed rule, we an inpatient psychiatric facility that considered a model based on facility- Subpart A—General Provisions meets the conditions of § 412.404 are level routine costs and patient-level paid under the prospective payment ancillary costs separately. Under this 2. Section 412.1 is amended as system described in subpart N of this model, the variables in the facility follows: part. routine cost regression are defined a. Redesignating paragraphs (a)(2) and * * * * * differently than in the ancillary cost and (a)(3) as paragraphs (a)(3) and (a)(4). 4. Section 412.22 is amended by proposed rule regressions. For example, revising paragraph (b). in the ancillary cost regression, length of b. Adding a new paragraph (a)(2). stay is each patient’s length of stay, but c. Redesignating paragraphs (b)(12) § 412.22 Excluded hospitals and hospital in the routine cost regression it is the and (b)(13) as paragraphs (b)(13) and units: General rules. facility’s average length of stay. (b)(14). * * * * * Similarly, in the ancillary cost d. Adding a new paragraph (b)(12). (b) Cost reimbursement. Except for regression, the age variable indicates those hospitals specified in paragraph whether an individual patient is over 65 The additions read as follows: (c) of this section, and § 412.20(b), (c), years of age, but in the routine cost § 412.1 Scope of part. and (d), all excluded hospitals (and regression it indicates the percentage of excluded hospital units, as described in the facility’s patients who are over 65 (a) * * * § 412.23 through § 412.29) are years of age. This difference in the (2) This part implements section 124 reimbursed under the cost routine and ancillary cost regressions of Public Law 106–113 by establishing reimbursement rules set forth in part also applies to the comorbidity and DRG a per diem prospective payment system 413 of this chapter, and are subject to variables. These differences in for the inpatient operating and capital the ceiling on the rate of hospital cost measurement mean that the coefficient costs of hospital inpatient services increases as specified in § 413.40 of this values of these variables are not directly furnished to Medicare beneficiaries by a chapter. comparable between the facility-level psychiatric facility that meets the * * * * * routine cost regression and the patient- conditions of subpart N of this part. 5. Section 412.23 is amended as level regression for ancillary cost or * * * * * follows: total cost. In addition, operationalizing a. Republishing paragraph (a) this model would present claims (b) * * * introductory text. processing and systems issues to keep (12) Subpart N describes the b. Redesignating paragraphs (a)(1) and the facility-level data up to date. prospective payment system specified (a)(2) as paragraphs (a)(2) and (a)(3). Therefore, we rejected this approach. in paragraph (a)(2) of this section for c. Adding a new paragraph (a)(1). In accordance with the provisions of inpatient psychiatric facilities and sets The republication and addition read Executive Order 12866, this proposed forth the general methodology for as follows: rule was reviewed by the Office of paying the operating and capital-related § 412.23 Excluded hospitals: Management and Budget. costs of hospital inpatient services Classifications. List of Subjects furnished by inpatient psychiatric * * * * * facilities effective with cost reporting (a) Psychiatric hospitals. A 42 CFR Part 412 periods beginning on or after April 1, psychiatric hospital must— Administrative practice and 2004. (1) Meet the following requirements to procedure, Health facilities, Medicare, * * * * * be excluded from the prospective

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66952 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

payment system as specified in inpatient services of psychiatric prospective payment amount for cases § 412.1(a)(1) and to be paid under the facilities. with unusually high costs. prospective payment system as 412.422 Basis of payment. Per diem payment amount means specified in § 412.1(a)(2) and in subpart 412.424 Methodology for calculating the payment based on the average cost of 1 Federal per diem payment rates. N of this part; 412.426 Transition period. day of inpatient psychiatric services. * * * * * 412.428 Publication of the Federal per diem Principal diagnosis means the 6. Section 412.25 is amended by payment rates. condition established after study to be revising the paragraph (a) introductory 412.432 Method of payment under the chiefly responsible for occasioning the text to read as follows: inpatient psychiatric facility prospective admission of the patient to the inpatient payment system. psychiatric facility. § 412.25 Excluded hospital units: Common Rural area means an area as defined Subpart N—Prospective Payment requirements. in § 412.62(f)(1)(iii). System for Hospital Inpatient Services (a) Basis for exclusion. In order to be Urban area means an area as defined of Psychiatric Facilities. excluded from the prospective payment in § 412.62(f)(1)(ii). systems as specified in § 412.1(a)(1) and § 412.400 Basis and scope of subpart. to be paid under the inpatient § 412.404 Conditions for payment under prospective payment system as (a) Basis. This subpart implements the prospective payment system for specified in 412.1(a)(2), a psychiatric section 124 of Public Law 106–113, hospital inpatient services of psychiatric unit must meet the following which provides for the implementation facilities. requirements. of a per diem based prospective (a) General requirements. (1) Effective payment system for inpatient * * * * * for cost reporting periods beginning on psychiatric hospitals and psychiatric or after April 1, 2004, an inpatient § 412.27 [Amended] units (inpatient psychiatric facilities). psychiatric facility must meet the 7. Section 412.27 is amended as (b) Scope. This subpart sets forth the conditions of this section to receive follows: framework for the prospective payment payment under the prospective payment a. Revising the introductory text. system for inpatient psychiatric system described in this subpart for b. Amending paragraph (a) by facilities, including the methodology hospital inpatient services furnished in removing the words ‘‘Third Edition’’, used for the development of the per psychiatric facilities to Medicare and adding in its place, ‘‘Fourth Edition, diem rate and associated adjustments, beneficiaries. Text Revision’’. the application of a transition period, (2) If an inpatient psychiatric facility The revision reads as follows: and the related rules. Under this system, fails to comply fully with these for cost reporting periods beginning on conditions, CMS may, as appropriate— § 412.27 Excluded psychiatric units: or after April 1, 2004, payment for the Additional requirements. (i) Withhold (in full or in part) or operating and capital-related costs of reduce Medicare payment to the In order to be excluded from the hospital inpatient services furnished by inpatient psychiatric facility until the prospective payment system as inpatient psychiatric facilities is made facility provides adequate assurances of specified in § 412.1(a)(1), and paid on the basis of prospectively determined compliance; or under the inpatient psychiatric rates and applied on a per diem basis. (ii) Classify the inpatient psychiatric prospective payment system as facility as a hospital that is subject to specified in § 412.1(a)(2), a psychiatric § 412.402 Definitions. the conditions of subpart C of this part unit must meet the following As used in this subpart— and is paid under the prospective requirements: Comorbidity means all specific patient conditions that are secondary to payment system as specified in * * * * * § 412.1(a)(1). 8. Section 412.116 is amended as the patient’s primary diagnosis and that coexists at the time of admission, (b) Inpatient psychiatric facilities follows: subject to the prospective payment a. Redesignating paragraphs (a)(3) and develop subsequently, or that affect the system. Subject to the special payment (a)(4) as paragraphs (a)(4) and (a)(5). treatment received or the length of stay b. Adding a new paragraph (a)(3). or both. Diagnoses that relate to an provisions of § 412.22(c), an inpatient The addition reads as follows: earlier episode of care that have no psychiatric facility must meet the bearing on the current hospital stay are general criteria set forth in § 412.22. For § 412.116 Method of payment. excluded. exclusion from the hospital inpatient (a) * * * Fixed dollar loss threshold means a prospective payment system as (3) For cost reporting periods dollar amount by which the costs of a specified in § 412.1(a)(1), a psychiatric beginning on or after April 1, 2004, case exceed payment in order to qualify hospital must meet the criteria set forth payments for hospital inpatient services for an outlier payment. in § 412.23(a) and psychiatric units furnished by a psychiatric hospital and Inpatient psychiatric facilities means must meet the criteria set forth in psychiatric unit that meet the hospitals that meet the requirements as § 412.25 and § 412.27. conditions of § 412.404 are made as specified in § 412.22, § 412.23(a) and (c) Limitations on charges to described in § 412.432. units that meet the requirements as beneficiaries—(1) Prohibited charges. * * * * * specified in § 412.22, § 412.25, and Except as permitted in paragraph (c)(2) 9. A new subpart N is added to read § 412.27. of this section, an inpatient psychiatric as follows: Interrupted stay means a Medicare facility may not charge a beneficiary for any services for which payment is made Subpart N—Prospective Payment System inpatient is discharged from the for Hospital Inpatient Services of inpatient psychiatric facility and returns by Medicare, even if the facility’s cost Psychiatric Facilities. to the same inpatient psychiatric facility of furnishing services to that beneficiary are greater than the amount the facility Sec. within 5 consecutive calendar days. The 412.400 Basis and scope of subpart. 5 consecutive calendar days begin with is paid under the prospective payment 412.402 Definitions. the day of discharge. system. 412.404 Conditions for payment under the Outlier payment means an additional (2) Permitted charges. An inpatient prospective payment system for hospital payment beyond the Federal psychiatric facility receiving payment

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66953

under this subpart for a covered hospital (2) Payment under the prospective under the prospective payment system stay (that is, a stay that included at least payment system is based on the Federal are estimated to equal the amount that one covered day) may charge the per diem payment rate that includes would have been made to inpatient Medicare beneficiary or other person adjustments as specified in § 412.424. psychiatric facilities if the prospective only the applicable deductible and (3) During the transition period, payment system described in this coinsurance amounts under § 409.82, payment is based on a blend of the subpart was not implemented. § 409.83, and § 409.87 of this chapter Federal per diem payment amount and (ii) CMS evaluates the accuracy of the and for items or services as specified the facility-specific payment rate as budget-neutrality adjustment within the under § 489.20(a) of this chapter. specified in § 412.426. first 5 years after implementation of the (d) Furnishing of hospital inpatient (b) Payment in full. (1) The payment inpatient prospective payment system. services directly or under arrangement. made under this subpart represents CMS may make a one-time prospective (1) Subject to the provisions of payment in full (subject to applicable adjustment to the Federal per diem base § 412.422, the applicable payments deductibles and coinsurance as rate to account for significant made under this subpart are payment in specified in subpart G of part 409 of this differences between the historical data full for all hospital inpatient services, as chapter) for inpatient operating and on cost-based TEFRA payments (the specified in § 409.10 of this chapter. capital-related costs associated with basis of the budget-neutrality Hospital inpatient services do not furnishing Medicare covered services in adjustment at the time of include the following: an inpatient psychiatric facility, but not implementation) and estimates of (i) Physicians’ services that meet the the cost of an approved medical TEFRA payments based on actual data requirements of § 415.102(a) of this education program as specified in from the first year of the prospective chapter for payment on a fee schedule § 413.85 and § 413.86 of this chapter. payment system. basis. (2) In addition to the payments based (c) Determining the Federal per diem (ii) Physician assistant services, as on the prospective payment rates, amount. The Federal per diem payment specified in section 1861(s)(2)(K)(i) of inpatient psychiatric facilities receive amount is the product of the Federal per the Act. payment for bad debts of Medicare diem base rate, the facility-level (iii) Nurse practitioners and clinical beneficiaries, as specified in § 413.80 of adjustments applicable to the inpatient nurse specialist services, as specified in this chapter. psychiatric facility, and the patient-level section 1861(s)(2)(K)(ii) of the Act. § 412.424 Methodology for calculating the characteristics applicable to the case as (iv) Certified nurse midwife services, Federal per diem payment rates. described in paragraphs (c)(1) and (c)(2) as specified in section 1861(gg) of the (a) Data sources. To calculate the of this section. Act. Federal per diem payment rate for (1) Facility-level adjustments. (i) (v) Qualified psychologist services, as inpatient psychiatric facilities, CMS Adjustment for wages. The labor portion specified in section 1861(ii) of the Act. uses the following data sources: of the Federal per diem base rate is (vi) Services of a certified registered (1) The best Medicare data available adjusted to account for geographic nurse anesthetist, as specified in section to estimate the average per diem differences in the area wage levels using 1861(bb) of the Act. payment amount for inpatient operating an appropriate wage index. The (2) CMS does not pay providers or and capital-related costs made as application of the wage index is made suppliers other than inpatient specified in part 413 of this chapter. on the basis of the location of the psychiatric facilities for services (2) Patient and facility cost report data inpatient psychiatric facility in an urban furnished to a Medicare beneficiary who capturing routine and ancillary costs. or rural area as specified in § 412.402. is an inpatient of the inpatient (3) An appropriate wage index to (ii) Location in rural areas. CMS psychiatric facility, except for services adjust for wage differences. adjusts the Federal per diem base rate described in paragraphs (d)(1)(i) through (4) An increase factor to adjust for the by a factor for facilities located in rural (d)(1)(vi) of this section. most recent estimate of increases in the areas as specified in § 412.62(f)(1)(iii). (3) The inpatient psychiatric facility prices of an appropriate market basket (iii) Teaching status. CMS adjusts the must furnish all necessary covered of goods and services provided by Federal per diem base rate by a factor services to the Medicare beneficiary inpatient psychiatric facilities. to account for a facility’s teaching status who is an inpatient of the inpatient (b) Determining the Federal per diem based on the ratio of the number of psychiatric facility, either directly or base amount. The Federal per diem base interns and residents assigned to the under arrangements (as specified in rate is the product of the updated facility divided by the facility’s average § 409.3 of this chapter). average per diem rate and the budget- daily census. (e) Reporting and recordkeeping neutrality adjustment factor as (2) Patient-level adjustments. (i) Age. requirements. All inpatient psychiatric described in paragraphs (b)(1) and (b)(2) CMS adjusts the Federal per diem base facilities participating in the prospective of this section. rate by a factor for patients age 65 and payment system under this subpart (1) Determining the average per diem older. must meet the recordkeeping and cost rate. CMS determines the average (ii) Principal diagnosis. The inpatient reporting requirements as specified in inpatient operating and capital per diem psychiatric facility must identify a § 412.27(c), § 413.20, and § 413.24 of cost for inpatient psychiatric facilities psychiatric diagnosis for each patient. this chapter. by using the best available data as CMS adjusts the wage-adjusted Federal specified in paragraph (a) of this per diem base rate by a factor to account § 412.422 Basis of payment. section. CMS applies the increase factor for the diagnosis-related group (a) Method of Payment. (1) Under the described in paragraph (a)(4) of this assignment associated with the prospective payment system, inpatient section to update the rate to the principal diagnosis, as specified by psychiatric facilities receive a midpoint of the first 15 months under CMS. predetermined per diem payment the system. (iii) Comorbidities. CMS adjusts the amount for inpatient services furnished (2) Budget-neutrality factor. (i) CMS Federal per diem base rate by a factor to Medicare Part A fee-for-service adjusts the average per diem amount to to account for certain comorbidities as beneficiaries. ensure that the aggregate payments specified by CMS.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66954 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

(iv) Variable per diem adjustments. (3) For cost reporting periods conditioned upon the intermediary’s CMS adjusts the Federal per diem base beginning on or after July 1, 2006 and best judgment as to whether payment rate by declining factors for day 1, days before June 30, 2007, payment is based can be made under the PIP method 2 through 4, and days 5 through 8 of the on 25 percent of the facility-specific without undue risk of resulting in an inpatient stay. The variable per diem payment and 75 percent of the Federal overpayment to the provider. adjustment does not apply after day 8. per diem payment amount. (2) Frequency of payment. For (v) Adjustment for high-cost cases. (4) For cost reporting periods facilities approved for PIP, the CMS provides for an additional beginning on or after July 1, 2007, intermediary estimates the annual payment if the estimated total cost for payment is based entirely on the Federal inpatient psychiatric facility’s Federal a case exceeds a fixed dollar loss per diem payment amount. per diem prospective payments, net of threshold plus the total per diem (b) Calculation of the facility-specific estimated beneficiary deductibles and payment amount for the case. payment. The facility-specific payment coinsurance, and makes biweekly (A) The fixed dollar loss threshold is is equal to the payment for each cost payments equal to 1⁄26 of the total adjusted for area wage levels, teaching reporting period in the transition period estimated amount of payment for the status, and rural location. that would have been made without year. If the inpatient psychiatric facility (B) The additional payment equals 80 regard to this subpart. The facility’s has payment experience under the percent of the difference between the Medicare fiscal intermediary calculates prospective payment system, the estimated cost of the case and the per the facility-specific payment for intermediary estimates PIP based on diem payment amount for days 1 inpatient operating costs and capital that payment experience, adjusted for through 8, 60 percent for days 9 and costs in accordance with part 413 of this projected changes supported by beyond. chapter. substantiated information for the (c) Treatment of new inpatient (C) Additional payments made under current year. Each payment is made 2 this section would be subject to the psychiatric facilities. New inpatient psychiatric facilities, weeks after the end of a biweekly period adjustments at § 412.84(i), except that of service as specified in § 413.64(h)(6) the national urban and rural medians that is, facilities that under present or previous ownership or both have their of this chapter. The interim payments would be used instead of statewide are reviewed at least twice during the averages, and at § 412.84(m) of this part. first cost reporting period as an IPF beginning on or after April 1, 2004, are reporting period and adjusted if (d) Special payment provision for necessary. Fewer reviews may be interrupted stays. If a patient is paid based entirely on the Federal per diem payment system. necessary if an inpatient psychiatric discharged from an inpatient psychiatric facility receives interim payments for facility and returns to the same facility § 412.428 Publication of the Federal per less than a full reporting period. These before midnight of the 5th consecutive diem payment rates. payments are subject to final settlement. day, the case is considered to be CMS will publish annually in the (3) Termination of PIP. (i) Request by continuous for purposes: Federal Register information pertaining the inpatient psychiatric facility. Subject (1) Determining the appropriate to the inpatient psychiatric facility to the provisions of paragraph (b)(1)(iii) variable per diem adjustment, as prospective payment system. This of this section, an inpatient psychiatric specified in paragraph (c)(2)(iv) of this information includes the Federal per facility receiving PIP may convert to section, applicable to the case. diem payment rates, the area wage receiving prospective payments on a (2) Determining whether the total cost index, and a description of the non-PIP basis at any time. for a case exceeds the fixed dollar loss methodology and data used to calculate threshold and qualifies for outlier (ii) Removal by the intermediary. An the payment rates. payments as specified in paragraph intermediary terminates PIP if the inpatient psychiatric facility no longer (c)(2)(v) of this section. § 412.432 Method of payment under the inpatient psychiatric facility prospective meets the requirements of § 413.64(h) of § 412.426 Transition period. payment system. this chapter. (a) Duration of transition period and (a) General rule. Subject to the (c) Interim payments for Medicare bad proportion of the blended transition exceptions in paragraphs (b) and (c) of debts and for costs of an approved rate. Except as provided in paragraph (c) this section, an inpatient psychiatric education program and other costs paid of this section, for cost reporting periods facility receives payment under this outside the prospective payment system. beginning on or after April 1, 2004 subpart for inpatient operating cost and The intermediary determines the through June 30, 2007, an inpatient capital-related costs for each inpatient interim payments by estimating the psychiatric facility receives a payment stay following submission of a bill. reimbursable amount for the year based comprised of a blend of the Federal per (b) Periodic interim payments (PIP). on the previous year’s experience, diem payment amount, as specified in (1) Criteria for receiving PIP. adjusted for projected changes § 412.424(c) and a facility-specific (i) An inpatient psychiatric facility supported by substantiated information payment as specified under paragraph receiving payment under this subpart for the current year, and makes (b) of this section. may receive PIP for Part A services biweekly payments equal to 1⁄26 of the (1) For cost reporting periods under the PIP method subject to the total estimated amount. Each payment is beginning on or after April 1, 2004 and provisions of § 413.64(h) of this chapter. made 2 weeks after the end of the before June 30, 2005, payment is based (ii) To be approved for PIP, the biweekly period of service as specified on 75 percent of the facility-specific inpatient psychiatric facility must meet in § 413.64(h)(6) of this chapter. The payment and 25 percent of the Federal the qualifying requirements in interim payments are reviewed at least per diem payment amount. § 413.64(h)(3) of this chapter. twice during the reporting period and (2) For cost reporting periods (iii) Payments to a psychiatric unit are adjusted if necessary. Fewer reviews beginning on or after July 1, 2005 and made under the same method of may be necessary if an inpatient before June 30, 2006, payment is based payment as the hospital of which it is psychiatric facility receives interim on 50 percent of the facility-specific a part as specified in § 412.116. payments for less than a full reporting payment and 50 percent of the Federal (iv) As provided in § 413.64(h)(5) of period. These payments are subject to per diem payment amount. this chapter, intermediary approval is final cost settlement.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66955

(d) Outlier payments. Additional (d) * * * § 412.1(a)(1) of this chapter and in payments for outliers are not made on (2) * * * accordance with § 412.25 through an interim basis. The outlier payments (ii) Payment to children’s hospitals § 412.30 of this chapter, except as are made based on the submission of a that are excluded from the prospective limited by paragraphs (a)(2)(iii) and discharge bill and represent final payment systems under subpart B of (a)(2)(iv) of this section with respect to payment. part 412 of this chapter, and hospitals psychiatric and rehabilitation hospitals (e) Accelerated payments. (1) General outside the 50 States and the District of and psychiatric and rehabilitation units rule. Upon request, an accelerated Columbia is on a reasonable cost basis, as specified in § 412.22, § 412.23, payment may be made to an inpatient subject to the provisions of § 413.40. § 412.25, § 412.27, § 412.29 and § 412.30 psychiatric facility that is receiving * * * * * of this chapter. payment under this subpart and is not (iv) For cost reporting periods * * * * * receiving PIP under paragraph (b) of this beginning before April 1, 2004, payment (iii) For cost reporting periods section if the inpatient psychiatric to psychiatric hospitals (as well as beginning on or after April 1, 2004 this facility is experiencing financial separate psychiatric units (distinct section applies to psychiatric hospitals difficulties because of the following: parts) of short-term general hospitals) and psychiatric units that are excluded (i) There is a delay by the that are excluded under subpart B of from the prospective payment systems intermediary in making payment to the part 412 of this chapter from the as specified in § 412.1(a)(1) of this inpatient psychiatric facility. prospective payment system is on a chapter and paid under the prospective (ii) Due to an exceptional situation, reasonable cost basis, subject to the payment system as specified in there is a temporary delay in the provisions of § 413.40. § 412.1(a)(2) of this chapter. inpatient psychiatric facility’s (v) For cost reporting periods * * * * * preparation and submittal of bills to the beginning on or after April 1, 2004, 4. Section 413.64 is amended by intermediary beyond the normal billing payment to psychiatric hospitals (as revising paragraph (h)(2)(i) to read as cycle. well as separate psychiatric units follows: (2) Approval of payment. An inpatient (distinct parts) of short-term general psychiatric facility’s request for an hospitals) that meet the conditions of § 413.64 Payment to providers: Specific accelerated payment must be approved § 412.404 of this chapter is based on rules. by the intermediary and CMS. prospectively determined rates under * * * * * (3) Amount of payment. The amount subpart N of part 412 of this chapter. (h) * * * of the accelerated payment is computed * * * * * (2) * * * as a percent of the net payment for (i) Part A inpatient services furnished unbilled or unpaid covered services. 3. Section 413.40 is amended as follows: in hospitals that are excluded from the (4) Recovery of payment. Recovery of prospective payment systems, as the accelerated payment is made by a. Redesignating paragraphs (a)(2)(i)(C) and (a)(2)(i)(D) as paragraphs specified in § 412.1(a)(1) of this chapter, recoupment as inpatient psychiatric and are paid under the prospective facility bills are processed or by direct (a)(2)(i)(D) and (a)(2)(i)(E). b. Adding a new paragraph payment system as specified in subpart payment by the inpatient psychiatric N of part 412 of this chapter. facility. (a)(2)(i)(C). c. Republishing paragraphs (a)(2)(ii) * * * * * PART 413—PRINCIPLES OF introductory text. d. Revising paragraph (a)(2)(ii)(B). PART 424—CONDITIONS OF REASONABLE COST MEDICARE PAYMENT REIMBURSEMENT; PAYMENT FOR e. Redesignating paragraphs (a)(2)(iii) END-STAGE RENAL DISEASE and (a)(2)(iv) as paragraphs (a)(2)(iv) 1. The authority citation for part 424 SERICES; PROSPECTIVELY and (a)(2)(v). continues to read as follows: DETERMINED PAYMENT FOR f. Adding a new paragraph (a)(2)(iii). The revision and additions read as Authority: Secs. 1102 and 1871 of the SKILLED NURSING FACILITIES Social Security Act (42 U.S.C. 1302 and follows: 1395hh). 1. The authority citation for part 413 is revised to read as follows: § 413.40 Ceiling on the rate of increase in 2. Section 424.14 is amended as hospital inpatient costs. follows: Authority: Secs. 1102, 1812(d), 1814(b), a. Adding paragraph (c)(3). 1815, 1833(a), (i), and (n), 1861 (v), 1871, (a) * * * 1881, 1883, and 1886 of the Social Security (2) * * * b. Revising paragraph (d)(2). Act (42 U.S.C. 1302, 1395d(d), 1395f(b), (i) * * * The addition and revision read as 1395g, 1395l(a), (i), and (n), 1395x(v), (C) Psychiatric hospitals and follows: 1395hh, 1395rr, 1395tt, and 1395ww). psychiatric units that are paid under the § 424.14 Requirements for inpatient 2. Section 413.1 is amended as prospective payment system for hospital services of psychiatric hospitals. follows: inpatient services under subpart N of part 412 of this chapter for cost * * * * * (c) * * * a. Revising paragraph (d)(2)(ii). reporting periods beginning on or after (3) The patient continues to need, on b. Redesignating paragraphs April 1, 2004. (d)(2)(iv),(d)(2)(v), (d)(2)(vi), and a daily basis, inpatient psychiatric care * * * * * (d)(2)(vii) as paragraphs (d)(2)(vi), (furnished directly by or requiring the (ii) For cost reporting periods (d)(2)(vii), (d)(2)(viii), and (d)(2)(ix). supervision of inpatient psychiatric (c) Adding new paragraphs (d)(2)(iv) beginning on or after October 1, 1983 facility personnel) or other professional and (d)(2)(v). through March 31, 2004, this section services that, as a practical matter can The revision and additions read as applies to— only be provided on an inpatient basis. follows: * * * * * (d) * * * (B) Psychiatric and rehabilitation (2) The first recertification is required § 413.1 Introduction. units excluded from the prospective as of the 10th day of hospitalization. * * * * * payment systems, as specified in Subsequent recertifications are required

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66956 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

at intervals established by the UR PROPOSED RATE AND ADJUSTMENT PROPOSED RATE AND ADJUSTMENT committee (on a case-by-case basis if it FACTORS—Continued FACTORS—Continued so chooses), but no less frequently than every 30 days. Labor-Share ...... $386 DRG 523 ...... 0.88 Non-Labor-Share ...... $144 * * * * * Proposed Comorbidity Adjustments (Catalog of Federal Domestic Assistance Proposed Facility Adjustments Program No. 93.773, Medicare—Hospital HIV ...... 1.06 Insurance; and Program No. 93.774, Rural Location ...... 1.16 Coagulation Factor Deficits ...... 1.11 ( ) Medicare—Supplementary Medical Wage Area Adjustment ...... 1 Tracheotomy ...... 1.14 (2) Insurance Program) Teaching Adjustment ...... Eating and Conduct Disorders 1.03 Dated: April 17, 2003. Infectious Diseases ...... 1.08 Proposed Variable Per Diem Adjustments Thomas A. Scully, Renal Failure, Acute ...... 1.08 Administrator, Centers for Medicare & Day 1 ...... 1.26 Rental Failure, Chronic ...... 1.14 Medicaid Services. Days 2 through 4 ...... 1.12 Malignant Neoplasm’s ...... 1.10 Approved: , 2003. Days 5 through 8 ...... 1.05 Uncontrolled Diabetes Mellitus with or without complications 1.10 Tommy G. Thompson, Proposed Age Adjustments Sever Protein Calorie Malnutri- Secretary. tion ...... 1.12 Editorial Note: This document was 65 Years of Age and Over ...... 1.13 Drug and Alcohol Induce Men- received at the Office of the Federal Register tal Disorders ...... 1.03 on November 18, 2003. Proposed DRG Adjustments Cardiac Conditions ...... 1.13 [The following addenda will not Arteriosclerosis of the Extremity DRG 12 ...... 1.07 appear in the Code of Federal with Gangrene ...... 1.17 DRG 23 ...... 1.10 Regulations.] Chronic Obstructed Pulmonary DRG 424 ...... 1.22 Disease ...... 1.12 Addendum A—Proposed Psychiatric DRG 425 ...... 1.08 Prospective Payment Adjustment DRG 426 ...... 1.00 Artificial Openings-Digestive DRG 427 ...... 1.01 and Urinary ...... 1.09 Rate and Adjustment Factors DRG 428 ...... 1.03 Severe Musculoskeletal and DRG 429 ...... 1.02 Connective Tissue Diseases 1.12 PROPOSED RATE AND ADJUSTMENT DRG 430 ...... 1.00 Poisoning ...... 1.14 DRG 431 ...... 1.02 FACTORS 1 See Addendum B. DRG 432 ...... 0.96 2 See section III.B.2.b. Proposed Per Diem Rate DRG 433 ...... 0.88 DRG 521 ...... 1.02 Proposed Per Diem Rate ...... $530 DRG 522 ...... 0.97

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS

MSA Urban area (constituent counties or county equivalents) Wage index

0040 Abilene, TX...... 0.7792 Taylor, TX 0060 Aguadilla, PR...... 0.4587 Aguada, PR Aguadilla, PR Moca, PR 0080 Akron, OH...... 0.9600 Portage, OH Summit, OH 0120 Albany, GA...... 1.0594 Dougherty, GA Lee, GA 0160 Albany-Schenectady-Troy, NY...... 0.8384 Albany, NY Montgomery, NY Rensselaer, NY Saratoga, NY Schenectady, NY Schoharie, NY 0200 Albuquerque, NM...... 0.9315 Bernalillo, NM Sandoval, NM Valencia, NM 0220 Alexandria, LA...... 0.7859 Rapides, LA 0240 Allentown-Bethlehem-Easton, PA ...... 0.9735 Carbon, PA Lehigh, PA Northampton, PA 0280 Altoona, PA...... 0.9225 Blair, PA 0320 Amarillo, TX...... 0.9034 Potter, TX

VerDate jul<14>2003 20:32 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66957

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Randall, TX 0380 Anchorage, AK...... 1.2358 Anchorage, AK 0440 Ann Arbor, MI ...... 1.1103 Lenawee, MI Livingston, MI Washtenaw, MI 0450 Anniston,AL ...... 0.8044 Calhoun, AL 0460 Appleton-Oshkosh-Neenah, WI...... 0.8997 Calumet, WI Outagamie, WI Winnebago, WI 0470 Arecibo, PR...... 0.4337 Arecibo, PR Camuy, PR Hatillo, PR 0480 Asheville, NC...... 0.9876 Buncombe, NC Madison, NC 0500 Athens, GA...... 1.0211 Clarke, GA Madison, GA Oconee, GA 0520 Atlanta, GA...... 0.9991 Barrow, GA Bartow, GA Carroll, GA Cherokee, GA Clayton, GA Cobb, GA Coweta, GA De Kalb, GA Douglas, GA Fayette, GA Forsyth, GA Fulton, GA Gwinnett, GA Henry, GA Newton, GA Paulding, GA Pickens, GA Rockdale, GA Spalding, GA Walton, GA 0560 Atlantic City-Cape May, NJ ...... 1.1017 Atlantic City, NJ Cape May, NJ 0580 Auburn-Opelika, AL...... 0.8325 Lee, AL 0600 Augusta-Aiken, GA–SC ...... 1.0264 Columbia, GA McDuffie, GA Richmond, GA Aiken, SC Edgefield, SC 0640 Austin-San Marcos, TX ...... 0.9637 Bastrop, TX Caldwell, TX Hays, TX Travis, TX Williamson, TX 0680 Bakersfield, CA...... 0.9899 Kern, CA 0720 Baltimore, MD...... 0.9929 Anne Arundel, MD Baltimore, MD Baltimore City, MD Carroll, MD Harford, MD Howard, MD Queen Annes, MD

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66958 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

0733 Bangor, ME...... 0.9664 Penobscot, ME 0743 Barnstable-Yarmouth, MA...... 1.3202 Barnstable, MA 0760 Baton Rouge, LA ...... 0.8294 Ascension, LA East Baton Rouge Livingston, LA West Baton Rouge, LA 0840 Beaumont-Port Arthur, TX ...... 0.8324 Hardin, TX Jefferson, TX Orange, TX 0860 Bellingham, WA...... 1.2282 Whatcom, WA 0870 Benton Harbor, MI ...... 0.9042 Berrien, MI 0875 Bergen-Passaic, NJ...... 1.2150 Bergen, NJ Passaic, NJ 0880 Billings, MT...... 0.9022 Yellowstone, MT 0920 Biloxi-Gulfport-Pascagoula, MS...... 0.8757 Hancock, MS Harrison, MS Jackson, MS 0960 Binghamton, NY...... 0.8341 Broome, NY Tioga, NY 1000 Birmingham, AL...... 0.9222 Blount, AL Jefferson, AL St. Clair, AL Shelby, AL 1010 Bismarck, ND...... 0.7972 Burleigh, ND Morton, ND 1020 Bloomington, IN...... 0.8907 Monroe, IN 1040 Bloomington-Normal, IL...... 0.9109 McLean, IL 1080 Boise City, ID ...... 0.9310 Ada, ID Canyon, ID 1123 Boston-Worcester-Lawrence-Lowell-Brockton, MA–NH ...... 1.1235 Bristol, MA Essex, MA Middlesex, MA Norfolk, MA Plymouth, MA Suffolk, MA Worcester, MA Hillsborough, NH Merrimack, NH Rockingham, NH Strafford, NH 1125 Boulder-Longmont, CO...... 0.9689 Boulder, CO 1145 Brazoria, TX ...... 0.8535 Brazoria, TX 1150 Bremerton, WA...... 1.0944 Kitsap, WA 1240 Brownsville-Harlingen-San Benito, TX ...... 0.8880 Cameron, TX 1260 Bryan-College Station, TX ...... 0.8821 Brazos, TX 1280 Buffalo-Niagara Falls, NY ...... 0.9365 Erie, NY Niagara, NY 1303 Burlington, VT...... 1.0052 Chittenden, VT Franklin, VT

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66959

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Grand Isle, VT 1310 Caguas, PR...... 0.4371 Caguas, PR Cayey, PR Cidra, PR Gurabo, PR San Lorenzo, PR 1320 Canton-Massillon, OH...... 0.8932 Carroll, OH Stark, OH 1350 Casper, WY...... 0.9690 Natrona, WY 1360 Cedar Rapids, IA ...... 0.9056 Linn, IA 1400 Champaign-Urbana, IL...... 1.0635 Champaign, IL 1440 Charleston-North Charleston, SC ...... 0.9235 Berkeley, SC Charleston, SC Dorchester, SC 1480 Charleston, WV...... 0.8898 Kanawha, WV Putnam, WV 1520 Charlotte-Gastonia-Rock Hill, NC–SC ...... 0.9850 Cabarrus, NC Gaston, NC Lincoln, NC Mecklenburg, NC Rowan, NC Stanly, NC Union, NC York, SC 1540 Charlottesville, VA...... 1.0438 Albemarle, VA Charlottesville City, VA Fluvanna, VA Greene, VA 1560 Chattanooga, TN–GA ...... 0.8976 Catoosa, GA Dade, GA Walker, GA Hamilton, TN Marion, TN 1580 Cheyenne, WY...... 0.8628 Laramie, WY 1600 Chicago, IL...... 1.1044 Cook, IL De Kalb, IL Du Page, IL Grundy, IL Kane, IL Kendall, IL Lake, IL McHenry, IL Will, IL 1620 Chico-Paradise, CA...... 0.9745 Butte, CA 1640 Cincinnati, OH–KY–IN ...... 0.9381 Dearborn, IN Ohio, IN Boone, KY Campbell, KY Gallatin, KY Grant, KY Kenton, KY Pendleton, KY Brown, OH Clermont, OH Hamilton, OH Warren, OH 1660 Clarksville-Hopkinsville, TN–KY ...... 0.8406 Christian, KY

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66960 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Montgomery, TN 1680 Cleveland-Lorain-Elyria, OH...... 0.9670 Ashtabula, OH Geauga, OH Cuyahoga, OH Lake, OH Lorain, OH Medina, OH 1720 Colorado Springs, CO ...... 0.9916 El Paso, CO 1740 Columbia MO...... 0.8496 Boone, MO 1760 Columbia, SC...... 0.9307 Lexington, SC Richland, SC 1800 Columbus, GA–AL ...... 0.8374 Russell, AL Chattahoochee, GA Harris, GA Muscogee, GA 1840 Columbus, OH...... 0.9751 Delaware, OH Fairfield, OH Franklin, OH Licking, OH Madison, OH Pickaway, OH 1880 Corpus Christi, TX ...... 0.8729 Nueces, TX San Patricio, TX 1890 Corvallis, OR...... 1.1453 Benton, OR 1900 Cumberland, MD–WV ...... 0.7847 Allegany, MD Mineral, WV 1920 Dallas, TX...... 0.9998 Collin, TX Dallas, TX Denton, TX Ellis, TX Henderson, TX Hunt, TX Kaufman, TX Rockwall, TX 1950 Danville, VA...... 0.8859 Danville City, VA Pittsylvania, VA 1960 Davenport-Moline-Rock Island, IA–IL ...... 0.8835 Scott, IA Henry, IL Rock Island, IL 2000 Dayton-Springfield, OH...... 0.9282 Clark, OH Greene, OH Miami, OH Montgomery, OH 2020 Daytona Beach, FL ...... 0.9062 Flagler, FL Volusia, FL 2030 Decatur, AL...... 0.8973 Lawrence, AL Morgan, AL 2040 Decatur, IL...... 0.8055 Macon, IL 2080 Denver, CO...... 1.0601 Adams, CO Arapahoe, CO Broomfield, CO Denver, CO Douglas, CO Jefferson, CO 2120 Des Moines, IA ...... 0.8791

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66961

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Dallas, IA Polk, IA Warren, IA 2160 Detroit, MI ...... 1.0448 Lapeer, MI Macomb, MI Monroe, MI Oakland, MI St. Clair, MI Wayne, MI 2180 Dothan, AL ...... 0.8137 Dale, AL Houston, AL 2190 Dover, DE ...... 0.9356 Kent, DE 2200 Dubuque, IA ...... 0.8795 Dubuque, IA 2240 Duluth-Superior, MN–WI ...... 1.0368 St. Louis, MN Douglas, WI 2281 Dutchess County, NY ...... 1.0684 Dutchess, NY 2290 Eau Claire, WI ...... 0.8952 Chippewa, WI Eau Clair, WI 2320 El Paso, TX ...... 0.9265 El Paso, TX 2330 Elkhart-Goshen, IN ...... 0.9722 Elkhart, IN 2335 Elmira, NY ...... 0.8416 Chemung, NY 2340 Enid, OK ...... 0.8376 Garfield, OK 2360 Erie, PA ...... 0.8925 Erie, PA 2400 Eugene-Springfield, OR ...... 1.0944 Lane, OR 2440 Evansville-Henderson, IN–KY ...... 0.8177 Posey, IN Vanderburgh, IN Warrick, IN Henderson, KY 2520 Fargo-Moorhead, ND–MN ...... 0.9684 Clay, MN Cass, ND 2560 Fayetteville, NC ...... 0.8889 Cumberland, NC 2580 Fayettevile-Springdale-Rogers, AR ...... 0.8100 Benton, AR Washington, AR 2620 Flagstaff, AZ–UT ...... 1.0682 Coconino, AZ Kane, UT 2640 Flint, MI ...... 1.1135 Genesee, MI 2650 Florence, AL ...... 0.7792 Colbert, AL Lauderdale, AL 2655 Florence, SC ...... 0.8780 Florence, SC 2670 Fort Collins-Loveland, CO ...... 1.0066 Larimer, CO 2680 Ft. Lauderdale, FL ...... 1.0297 Broward, FL 2700 Fort Myers-Cape Coral, FL ...... 0.9680 Lee, FL 2710 Fort Pierce-Port St. Lucie, FL ...... 0.9823 Martin, FL St. Lucie, FL 2720 Fort Smith, AR–OK ...... 0.7895 Crawford, AR Sebastian, AR

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66962 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Sequoyah, OK 2750 Fort Walton Beach, FL ...... 0.9693 Okaloosa, FL 2760 Fort Wayne, IN ...... 0.9457 Adams, IN Allen, IN De Kalb, IN Huntington, IN Wells, IN Whitley, IN 2800 Fort Worth-Arlington, TX ...... 0.9446 Hood, TX Johnson, TX Parker, TX Tarrant, TX 2840 Fresno, CA ...... 1.0216 Fresno, CA Madera, CA 2880 Gadsden AL ...... 0.8505 Etowah, AL 2900 Gainesville, FL ...... 0.9871 Alachua, FL 2920 Galveston-Texas City, TX ...... 0.9465 Galveston, TX 2960 Gary, IN ...... 0.9584 Lake, IN Porter, IN 2975 Glens Falls, NY ...... 0.8281 Warren, NY Washington, NY 2980 Goldsboro, NC ...... 0.8892 Wayne, NC 2985 Grand Forks, ND–MN ...... 0.8897 Polk, MN Grand Forks, ND 2995 Grand Junction, CO ...... 0.9456 Mesa, CO 3000 Grand Rapids-Muskegon-Holland, MI ...... 0.9525 Allegan, MI Kent, MI Muskegon, MI Ottawa, MI 3040 Great Falls, MT ...... 0.8950 Cascade, MT 3060 Greeley, CO ...... 0.9237 Weld, CO 3080 Green Bay, WI ...... 0.9502 Brown, WI 3120 Greensboro-Winston-Salem-High Point, NC ...... 0.9282 Alamance, NC Davidson, NC Davie, NC Forsyth, NC Guilford, NC Randolph, NC Stokes, NC Yadkin, NC 3150 Greenville, NC ...... 0.9100 Pitt, NC 3160 Greenville-Spartanburg-Anderson, SC ...... 0.9122 Anderson, SC Cherokee, SC Greenville, SC Pickens, SC Spartanburg, SC 3180 Hagerstown, MD ...... 0.9268 Washington, MD 3200 Hamilton-Middletown, OH ...... 0.9418 Butler, OH 3240 Harrisburg-Lebanon-Carlisle, PA ...... 0.9223 Cumberland, PA Dauphin, PA

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66963

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Lebanon, PA Perry, PA 3283 Hartford, CT ...... 1.1549 Hartford, CT Litchfield, CT Middlesex, CT Tolland, CT 3285 Hattiesburg, MS ...... 0.7659 Forrest, MS Lamar, MS 3290 Hickory-Morganton-Lenoir, NC ...... 0.9028 Alexander, NC Burke, NC Caldwell, NC Catawba, NC 3320 Honolulu, HI ...... 1.1457 Honolulu, HI 3350 Houma, LA ...... 0.8385 Lafourche, LA Terrebonne, LA 3360 Houston, TX ...... 0.9892 Chambers, TX Fort Bend, TX Harris, TX Liberty, TX Montgomery, TX Waller, TX 3400 Huntington-Ashland, WV–KY–OH ...... 0.9636 Boyd, KY Carter, KY Greenup, KY Lawrence, OH Cabell, WV Wayne, WV 3440 Huntsville, AL ...... 0.8903 Limestone, AL Madison, AL 3480 Indianapolis, IN...... 0.9717 Boone, IN Hamilton, IN Hancock, IN Hendricks, IN Johnson, IN Madison, IN Marion, IN Morgan, IN Shelby, IN 3500 Iowa City, IA ...... 0.9587 Johnson, IA 3520 Jackson, MI...... 0.9532 Jackson, MI 3560 Jackson, MS...... 0.8607 Hinds, MS Madison, MS Rankin, MS 3580 Jackson, TN...... 0.9275 Chester, TN Madison, TN 3600 Jacksonville, FL...... 0.9281 Clay, FL Duval, FL Nassau, FL St. Johns, FL 3605 Jacksonville, NC...... 0.8239 Onslow, NC 3610 Jamestown, NY...... 0.7976 Chautaqua, NY 3620 Janesville-Beloit, WI...... 0.9849 Rock, WI 3640 Jersey City, NJ ...... 1.1190 Hudson, NJ 3660 Johnson City-Kingsport-Bristol, TN–VA ...... 0.8268

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66964 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Carter, TN Hawkins, TN Sullivan, TN Unicoi, TN Washington, TN Bristol City, VA Scott, VA Washington, VA 3680 Johnstown, PA...... 0.8329 Cambria, PA Somerset, PA 3700 Jonesboro, AR...... 0.7749 Craighead, AR 3710 Joplin, MO...... 0.8613 Jasper, MO Newton, MO 3720 Kalamazoo-Battlecreek, MI...... 1.0595 Calhoun, MI Kalamazoo, MI Van Buren, MI 3740 Kankakee, IL...... 1.0790 Kankakee, IL 3760 Kansas City, KS–MO ...... 0.9736 Johnson, KS Leavenworth, KS Miami, KS Wyandotte, KS Cass, MO Clay, MO Clinton, MO Jackson, MO Lafayette, MO Platte, MO Ray, MO 3800 Kenosha, WI...... 0.9686 Kenosha, WI 3810 Killeen-Temple, TX...... 1.0399 Bell, TX Coryell, TX 3840 Knoxville, TN...... 0.8970 Anderson, TN Blount, TN Knox, TN Loudon, TN Sevier, TN Union, TN 3850 Kokomo, IN...... 0.8971 Howard, IN Tipton, IN 3870 La Crosse, WI–MN ...... 0.9400 Houston, MN La Crosse, WI 3880 Lafayette, LA...... 0.8475 Acadia, LA Lafayette, LA St. Landry, LA St. Martin, LA 3920 Lafayette, IN...... 0.9278 Clinton, IN Tippecanoe, IN 3960 Lake Charles, LA ...... 0.7965 Calcasieu, LA 3980 Lakeland-Winter Haven, FL ...... 0.9357 Polk, FL 4000 Lancaster, PA...... 0.9078 Lancaster, PA 4040 Lansing-East Lansing, MI ...... 0.9726 Clinton, MI Eaton, MI Ingham, MI 4080 Laredo, TX...... 0.8472 Webb, TX

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66965

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

4100 Las Cruces, NM ...... 0.8745 Dona Ana, NM 4120 Las Vegas, NV–AZ ...... 1.1521 Mohave, AZ Clark, NV Nye, NV 4150 Lawrence, KS...... 0.7923 Douglas, KS 4200 Lawton, OK...... 0.8315 Comanche, OK 4243 Lewiston-Auburn, ME...... 0.9179 Androscoggin, ME 4280 Lexington, KY...... 0.8581 Bourbon, KY Clark, KY Fayette, KY Jessamine, KY Madison, KY Scott, KY Woodford, KY 4320 Lima, OH...... 0.9483 Allen, OH Auglaize, OH 4360 Lincoln, NE...... 0.9892 Lancaster, NE 4400 Little Rock-North Little, AR ...... 0.9097 Faulkner, AR Lonoke, AR Pulaski, AR Saline, AR 4420 Longview-Marshall, TX...... 0.8629 Gregg, TX Harrison, TX Upshur, TX 4480 Los Angeles-Long Beach, CA ...... 1.2001 Los Angeles, CA 4520 Louisville, KY–IN ...... 0.9276 Clark, IN Floyd, IN Harrison, IN Scott, IN Bullitt, KY Jefferson, KY Oldham, KY 4600 Lubbock, TX...... 0.9646 Lubbock, TX 4640 Lynchburg, VA...... 0.9219 Amherst, VA Bedford City, VA Bedford, VA Campbell, VA Lynchburg City, VA 4680 Macon, GA...... 0.9204 Bibb, GA Houston, GA Jones, GA Peach, GA Twiggs, GA 4720 Madison, WI...... 1.0467 Dane, WI 4800 Mansfield, OH...... 0.8900 Crawford, OH Richland, OH 4840 Mayaguez, PR...... 0.4914 Anasco, PR Cabo Rojo, PR Hormigueros, PR Mayaguez, PR Sabana Grande, PR San German, PR 4880 McAllen-Edinburg-Mission, TX ...... 0.8428 Hidalgo, TX

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66966 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

4890 Medford-Ashland, OR ...... 1.0498 Jackson, OR 4900 Melbourne-Titusville-Palm Bay, FL ...... 1.0253 Brevard, FL 4920 Memphis, TN–AR–MS ...... 0.8920 Crittenden, AR De Soto, MS Fayette, TN Shelby, TN Tipton, TN 4940 Merced, CA ...... 0.9837 Merced, CA 5000 Miami, FL ...... 0.9802 Dade, FL 5015 Middlesex-Somerset-Hunterdon, NJ ...... 1.2313 Hunterdon, NJ Middlesex, NJ Somerset, NJ 5080 Milwaukee-Waukesha, WI ...... 0.9893 Milwaukee, WI Ozaukee, WI Washington, WI Waukesha, WI 5120 Minneapolis-St. Paul, MN-WI ...... 1.0903 Anoka, MN Carver, MN Chisago, MN Dakota, MN Hennepin, MN Isanti, MN Ramsey, MN Scott, MN Sherburne, MN Washington, MN Wright, MN Pierce, WI St. Croix, WI 5140 Missoula, MT ...... 0.9157 Missoula, MT 5160 Mobile, AL ...... 0.8108 Baldwin, AL Mobile, AL 5170 Modesto, CA ...... 1.0498 Stanislaus, CA 5190 Monmouth-Ocean, NJ ...... 1.0674 Monmouth, NJ Ocean, NJ 5200 Monroe, LA ...... 0.8137 Ouachita, LA 5240 Montgomery, AL ...... 0.7734 Autauga, AL Elmore, AL Montgomery, AL 5280 Muncie, IN ...... 0.9284 Delaware, IN 5330 Myrtle Beach, SC ...... 0.8976 Horry, SC 5345 Naples, FL ...... 0.9754 Collier, FL 5360 Nashville, TN ...... 0.9578 Cheatham, TN Davidson, TN Dickson, TN Robertson, TN Rutherford, TN Sumner, TN Williamson, TN Wilson, TN 5380 Nassau-Suffolk, NY ...... 1.3357 Nassau, NY Suffolk, NY 5483 New Haven-Bridgeport-Stamford-Waterbury-Danbury, CT ...... 1.2408

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66967

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Fairfield, CT New Haven, CT 5523 New London-Norwich, CT ...... 1.1767 New London, CT 5560 New Orleans, LA ...... 0.9046 Jefferson, LA Orleans, LA Plaquemines, LA St. Bernard, LA St. Charles, LA St. James, LA St. John The Baptist, LA St. Tammany, LA 5600 New York, NY ...... 1.4414 Bronx, NY Kings, NY New York, NY Putnam, NY Queens, NY Richmond, NY Rockland, NY Westchester, NY 5640 Newark, NJ ...... 1.1381 Essex, NJ Morris, NJ Sussex, NJ Union, NJ Warren, NJ 5660 Newburgh, NY–PA ...... 1.1387 Orange, NY Pike, PA 5720 Norfolk-Virginia Beach-Newport News, VA–NC ...... 0.8574 Currituck, NC Chesapeake City, VA Gloucester, VA Hampton City, VA Isle of Wight, VA James City, VA Mathews, VA Newport News City, VA Norfolk City, VA Poquoson City, VA Portsmouth City, VA Suffolk City, VA Virginia Beach City, VA Williamsburg City, VA York, VA 5775 Oakland, CA ...... 1.5072 Alameda, CA Contra Costa, CA 5790 Ocala, FL ...... 0.9402 Marion, FL 5800 Odessa-Midland, TX ...... 0.9397 Ector, TX Midland, TX 5800 Oklahoma City, OK ...... 0.8900 Canadian, OK Cleveland, OK Logan, OK McClain, OK Oklahoma, OK Pottawatomie, OK 5910 Olympia, WA ...... 1.0960 Thurston, WA 5920 Omaha, NE–IA ...... 0.9978 Pottawattamie, IA Cass, NE Douglas, NE Sarpy, NE Washington, NE 5945 Orange County, CA ...... 1.1474 Orange, CA

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66968 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

5960 Orlando, FL ...... 0.9640 Lake, FL Orange, FL Osceola, FL Seminole, FL 5990 Owensboro, KY ...... 0.8344 Daviess, KY 6015 Panama City, FL ...... 0.8865 Bay, FL 6020 Parkersburg-Marietta, WV–OH ...... 0.8127 Washington, OH Wood, WV 6080 Pensacola, FL ...... 0.8645 Escambia, FL Santa Rosa, FL 6120 Peoria-Pekin, IL ...... 0.8739 Peoria, IL Tazewell, IL Woodford, IL 6160 Philadelphia, PA–NJ ...... 1.0713 Burlington, NJ Camden, NJ Gloucester, NJ Salem, NJ Bucks, PA Chester, PA Delaware, PA Montgomery, PA Philadelphia, PA 6200 Phoenix-Mesa, AZ ...... 0.9820 Maricopa, AZ Pinal, AZ 6240 Pine Bluff, AR ...... 0.7962 Jefferson, AR 6280 Pittsburgh, PA ...... 0.9365 Allegheny, PA Beaver, PA Butler, PA Fayette, PA Washington, PA Westmoreland, PA 6323 Pittsfield, MA ...... 1.0235 Berkshire, MA 6340 Pocatello, ID ...... 0.9372 Bannock, ID 6360 Ponce, PR ...... 0.5169 Guayanilla, PR Juana Diaz, PR Penuelas, PR Ponce, PR Villalba, PR Yauco, PR 6403 Portland, ME ...... 0.9794 Cumberland, ME Sagadahoc, ME York, ME 6440 Portland-Vancouver, OR–WA ...... 1.0667 Clackamas, OR Columbia, OR Multnomah, OR Washington, OR Yamhill, OR Clark, WA 6483 Providence-Warwick-Pawtucket, RI ...... 1.0854 Bristol, RI Kent, RI Newport, RI Providence, RI Washington, RI 6520 Provo-Orem, UT ...... 0.9984 Utah, UT 6560 Pueblo, CO...... 0.8820

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66969

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Pueblo, CO 6580 Punta Gorda, FL ...... 0.9218 Charlotte, FL 6600 Racine, WI ...... 0.9334 Racine, WI 6640 Raleigh-Durham-Chapel Hill, NC ...... 0.9990 Chatham, NC Durham, NC Franklin, NC Johnston, NC Orange, NC Wake, NC 6660 Rapid City, SD ...... 0.8846 Pennington, SD 6680 Reading, PA ...... 0.9295 Berks, PA 6690 Redding, CA...... 1.1135 Shasta, CA 6720 Reno, NV ...... 1.0648 Washoe. NV 6740 Richland-Kennewick-Pasco, WA ...... 1.1491 Benton, WA Franklin, WA 6760 Richmond-Petersburg, VA ...... 0.9477 Charles City County, VA Chesterfield, VA Colonial Heights City, VA Dinwiddie, VA Goochland, VA Hanover, VA Henrico, VA Hopewell City, VA New Kent, VA Petersburg City, VA Powhatan, VA Prince George, VA Richmond City, VA 6780 Riverside-San Bernardino, CA ...... 1.1365 Riverside, CA San Bernardino, CA 6800 Roanoke, VA ...... 0.8614 Botetourt, VA Roanoke, VA Roanoke City, VA Salem City, VA 6820 Rochester, MN ...... 1.2139 Olmsted, MN 6840 Rochester, NY ...... 0.9194 Genesee, NY Livingston, NY Monroe, NY Ontario, NY Orleans, NY Wayne, NY 6880 Rockford, IL...... 0.9625 Boone, IL Ogle, IL Winnebago, IL 6895 Rocky Mount, NC ...... 0.9228 Edgecombe, NC Nash, NC 6920 Sacramento, CA...... 1.1500 El Dorado, CA Placer, CA Sacramento, CA 6960 Saginaw-Bay City-Midland, MI ...... 0.9650 Bay, MI Midland, MI Saginaw, MI 6980 St. Cloud, MN ...... 0.9700 Benton, MN Stearns, MN

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00051 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66970 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

7000 St. Joseph, MO ...... 0.8021 Andrews, MO Buchanan, MO 7040 St. Louis, MO–IL ...... 0.8855 Clinton, IL Jersey, IL Madison, IL Monroe, IL St. Clair, IL Franklin, MO Jefferson, MO Lincoln, MO St. Charles, MO St. Louis, MO St. Louis City, MO Warren, MO Sullivan City, MO 7080 Salem, OR ...... 1.0367 Marion, OR Polk, OR 7120 Salinas, CA ...... 1.4623 Monterey, CA 7160 Salt Lake City-Ogden, UT ...... 0.9945 Davis, UT Salt Lake, UT Weber, UT 7200 San Angelo, TX ...... 0.8374 Tom Green, TX 7240 San Antonio, TX ...... 0.8753 Bexar, TX Comal, TX Guadalupe, TX Wilson, TX 7320 San Diego, CA ...... 1.1131 San Diego, CA 7360 San Francisco, CA ...... 1.4142 Marin, CA San Francisco, CA San Mateo, CA 7400 San Jose, CA ...... 1.4145 Santa Clara, CA 7440 San Juan-Bayamon, PR ...... 0.4741 Aguas Buenas, PR Barceloneta, PR Bayamon, PR Canovanas, PR Carolina, PR Catano, PR Ceiba, PR Comerio, PR Corozal, PR Dorado, PR Fajardo, PR Florida, PR Guaynabo, PR Humacao, PR Juncos, PR Los Piedras, PR Loiza, PR Luguillo, PR Manati, PR Morovis, PR Naguabo, PR Naranjito, PR Rio Grande, PR San Juan, PR Toa Alta, PR Toa Baja, PR Trujillo Alto, PR Vega Alta, PR Vega Baja, PR Yabucoa, PR

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00052 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66971

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

7460 San Luis Obispo-Atascadero-Paso Robles, CA ...... 1.1271 San Luis Obispo, CA 7480 Santa Barbara-Santa Maria-Lompoc, CA ...... 1.0481 Santa Barbara, CA 7485 Santa Cruz-Watsonville, CA ...... 1.3646 Santa Cruz, CA 7490 Santa Fe, NM ...... 1.0712 Los Alamos, NM Santa Fe, NM 7500 Santa Rosa, CA ...... 1.3046 Sonoma, CA 7510 Sarasota-Bradenton, FL...... 0.9425 Manatee, FL Sarasota, FL 7520 Savannah, GA...... 0.9376 Bryan, GA Chatham, GA Effingham, GA 7560 Scranton-Wilkes-Barre-Hazleton, PA...... 0.8599 Columbia, PA Lackawanna, PA Luzerne, PA , PA 7600 Seattle-Bellevue-Everett, WA...... 1.1474 Island, WA King, WA Snohomish, WA 7610 Sharon, PA...... 0.7869 Mercer, PA 7620 Sheboygan, WI...... 0.8697 Sheboygan, WI 7640 Sherman-Denison, TX...... 0.9255 Grayson, TX 7680 Shreveport-Bossier City, LA ...... 0.8987 Bossier, LA Caddo, LA Webster, LA 7720 Sioux City, IA-NE ...... 0.9046 Woodbury, IA Dakota, NE 7760 Sioux Falls, SD ...... 0.9257 Lincoln, SD Minnehaha, SD 7800 South Bend, IN ...... 0.9802 St. Joseph, IN 7840 Spokane, WA...... 1.0852 Spokane, WA 7880 Springfield, IL...... 0.8659 Menard, IL Sangamon, IL 7920 Springfield, MO...... 0.8424 Christian, MO Greene, MO Webster, MO 8003 Springfield, MA...... 1.0927 Hampden, MA Hampshire, MA 8050 State College, PA ...... 0.8941 Centre, PA 8080 Steubenville-Weirton, OH-WV...... 0.8804 Jefferson, OH Brooke, WV Hancock, WV 8120 Stockton-Lodi, CA...... 1.0506 San Joaquin, CA 8140 Sumter, SC...... 0.8273 Sumter, SC 8160 Syracuse, NY...... 0.9714 Cayuga, NY Madison, NY Onondaga, NY Oswego, NY

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00053 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66972 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

8200 Tacoma, WA...... 1.0940 Pierce, WA 8240 Tallahassee, FL...... 0.8504 Gadsden, FL Leon, FL 8280 Tampa-St. Petersburg-Clearwater, FL ...... 0.9065 Hernando, FL Hillsborough, FL Pasco, FL Pinellas, FL 8320 Terre Haute, IN ...... 0.8599 Clay, IN Vermillion, IN Vigo, IN 8360 Texarkana, AR-Texarkana, TX ...... 0.8088 Miller, AR Bowie, TX 8400 Toledo, OH...... 0.9810 Fulton, OH Lucas, OH Wood, OH 8440 Topeka, KS...... 0.9199 Shawnee, KS 8480 Trenton, NJ...... 1.0432 Mercer, NJ 8520 Tucson, AZ...... 8911 Pima, AZ 8560 Tulsa, OK...... 0.8332 Creek, OK Osage, OK Rogers, OK Tulsa, OK Wagoner, OK 8600 Tuscaloosa, AL...... 0.8130 Tuscaloosa, AL 8640 Tyler, TX...... 0.9521 Smith, TX 8680 Utica-Rome, NY...... 0.8465 Herkimer, NY Oneida, NY 8720 Vallejo-Fairfield-Napa, CA...... 1.3354 Napa, CA Solano, CA 8735 Ventura, CA...... 1.1096 Ventura, CA 8750 Victoria, TX...... 0.8756 Victoria, TX 8760 Vineland-Millville-Bridgeton, NJ...... 1.0031 Cumberland, NJ 8780 Visalia-Tulare-Porterville, CA...... 0.9429 Tulare, CA 8800 Waco, TX...... 0.8073 McLennan, TX 8840 Washington, DC–MD–VA–WV ...... 1.0851 District of Columbia, DC Calvert, MD Charles, MD Frederick, MD Montgomery, MD Prince Georges, MD Alexandria City, VA Arlington, VA Clarke, VA Culpepper, VA Fairfax, VA Fairfax City, VA Falls Church City, VA Fauquier, VA Fredericksburg City, VA King George, VA Loudoun, VA Manassas City, VA

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00054 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66973

ADDENDUM B1.—PROPOSED PRE-RECLASSIFIED WAGE INDEX FOR URBAN AREAS—Continued

MSA Urban area (constituent counties or county equivalents) Wage index

Manassas Park City, VA Prince William, VA Spotsylvania, VA Stafford, VA Warren, VA Berkeley, WV Jefferson, WV 8920 Waterloo-Cedar Falls, IA ...... 0.8069 Black Hawk, IA 8940 Wausau, WI...... 0.9782 Marathon, WI 8960 West Palm Beach-Boca Raton, FL ...... 0.9939 Palm Beach, FL 9000 Wheeling, OH–WV ...... 0.7670 Belmont, OH Marshall, WV Ohio, WV 9040 Wichita, KS...... 0.9520 Butler, KS Harvey, KS Sedgwick, KS 9080 Wichita Falls, TX ...... 0.8498 Archer, TX Wichita, TX 9140 Williamsport, PA...... 0.8544 Lycoming, PA 9160 Wilmington-Newark, DE–MD ...... 1.1173 New Castle, DE Cecil, MD 9200 Wilmington, NC...... 0.9640 New Hanover, NC Brunswick, NC 9260 Yakima, WA...... 1.0569 Yakima, WA 9270 Yolo, CA...... 0.9434 Yolo, CA 9280 York, PA...... 0.9026 York, PA 9320 Youngstown-Warren, OH...... 0.9358 Columbiana, OH Mahoning, OH Trumbull, OH 9340 Yuba City, CA ...... 1.0276 Sutter, CA Yuba, CA 9360 Yuma, AZ...... 0.8589 Yuma, AZ

ADDENDUM B2.—WAGE INDEX FOR ADDENDUM B2.—WAGE INDEX FOR ADDENDUM B2.—WAGE INDEX FOR RURAL AREAS RURAL AREAS—Continued RURAL AREAS—Continued

Nonurban area Wage index Nonurban area Wage index Nonurban area Wage index

Alabama ...... 0.7660 Louisiana ...... 0.7567 Ohio ...... 0.8613 Alaska ...... 1.2293 Maine ...... 0.8874 Oklahoma ...... 0.7590 Arizona ...... 0.8493 Maryland ...... 0.8946 Oregon ...... 1.0303 Arkansas ...... 0.7666 Massachusetts ...... 1.1288 Pennsylvania ...... 0.8462 California ...... 0.9840 Michigan ...... 0.9000 Puerto Rico ...... 0.4356 Colorado ...... 0.9015 Minnesota ...... 0.9151 Rhode Island 1 ...... Connecticut ...... 1.2394 Mississippi ...... 0.7680 South Carolina ...... 0.8607 Delaware ...... 0.9128 Missouri ...... 0.8021 South Dakota ...... 0.7815 Florida ...... 0.8814 Georgia ...... 0.8230 Montana ...... 0.8481 Tennessee ...... 0.7877 Guam ...... 0.9611 Nebraska ...... 0.8204 Texas ...... 0.7821 Hawaii ...... 1.0255 Nevada ...... 0.9577 Utah ...... 0.9312 Idaho ...... 0.8747 New Hampshire ...... 0.9796 Vermont ...... 0.9345 Illinois ...... 0.8204 New Jersey 1 ...... Virginia ...... 0.8504 Indiana ...... 0.8755 New Mexico ...... 0.8872 Virgin Islands ...... 0.7845 Iowa ...... 0.8315 New York ...... 0.8542 Washington ...... 1.0179 Kansas ...... 0.7923 North Carolina ...... 0.8666 West Virginia ...... 0.7975 Kentucky ...... 0.8079 North Dakota ...... 0.7788 Wisconsin ...... 0.9162

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00055 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 66974 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

ADDENDUM B2.—WAGE INDEX FOR BILLING CODE 4120–01–P RURAL AREAS—Continued

Nonurban area Wage index

Wyoming ...... 0.9007 1 All counties within the State are classified urban.

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00056 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66975

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00057 Fmt 4701 Sfmt 4725 E:\FR\FM\28NOP2.SGM 28NOP2 EP28NO03.000 66976 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00058 Fmt 4701 Sfmt 4725 E:\FR\FM\28NOP2.SGM 28NOP2 EP28NO03.001 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66977

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00059 Fmt 4701 Sfmt 4725 E:\FR\FM\28NOP2.SGM 28NOP2 EP28NO03.002 66978 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

[FR Doc. 03–29137 Filed 11–19–03; 8:45 am] BILLING CODE 4120–01–C

VerDate jul<14>2003 19:41 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00060 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP2.SGM 28NOP2 EP28NO03.003 Friday, November 28, 2003

Part III

Department of Housing and Urban Development 24 CFR Parts 1006 and 1007 Housing Assistance for Native Hawaiians: Native Hawaiian Housing Block Grant Program and Loan Guarantees for Native Hawaiian Housing Program; Direct Final Rule

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\28NOR2.SGM 28NOR2 66980 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

DEPARTMENT OF HOUSING AND modeled on the Indian Housing Block Hawaiian Home Lands. HUD agrees that URBAN DEVELOPMENT Grant (IHBG) program under an individual who is a bona fide NAHASDA. Section 514 of the HHH Act homestead leaseholder satisfies the 24 CFR Parts 1006 and 1007 adds a new Section 184A to the Housing NHHBG program requirement that the [Docket No. FR–4668–F–03] and Community Development Act of family is eligible to reside on the 1992 to authorize a new program of Hawaiian Home Lands. The lease is RIN 2577–AC27 housing loan guarantees for Native sufficient to document the requirement. Hawaiians based upon the Section 184 Section 1006.101 Housing Plan Housing Assistance for Native Loan Guarantee for Indian Housing Requirements Hawaiians: Native Hawaiian Housing program. Block Grant Program and Loan HUD published an interim rule on Comment: Since no federal funds Guarantees for Native Hawaiian June 13, 2002 (67 FR 40774), to were used in constructing past units on Housing Program; Final Rule implement the Act at 24 CFR part 1006 the Hawaiian Home Lands, DHHL AGENCY: Office of the Assistant as the Native Hawaiian Housing Block should not be required to report on the Secretary for Public and Indian Grant (NHHBG) program, and to condition or disposition of those Housing, HUD. implement the Section 184A Native dwellings. HUD response: The housing plan ACTION: Final rule. Hawaiian Housing Loan Guarantee program (Section 184A program) at 24 requirements of §§ 1006.101(b)(vii) and SUMMARY: This rule issues as final, and CFR part 1007. Public comment was (viii), which this comment addresses, responds to public comments on, an also invited on the two new programs of are taken directly from the authorizing interim rule published on June 13, 2002, housing assistance for Native statute (see 25 U.S.C. 4223(c)(2)(D)(vii) to implement procedures and Hawaiians. This rule issues as final, and and (viii)). In general, the statutory requirements for two new programs to responds to public comments received provisions for a housing plan require a address the housing needs of Native on, the June 13, 2002, interim rule. more comprehensive approach that Hawaiians. The Native Hawaiian looks at the use of NHHBG funding not II. Response to Public Comment on the Housing Block Grant program will in isolation, but within the context of Interim Rule provide housing block grants to fund the overall housing needs of Native affordable housing activities. The The public comment period on the Hawaiians and the total resources Section 184A Loan Guarantees for June 13, 2002, interim rule closed on available to address those needs. Native Hawaiian Housing program will August 12, 2002. HUD received four Therefore, even though no federal funds provide Native Hawaiian families with comments on the interim rule. were used in the construction of past greater access to private mortgage Comments were received from a units, it is necessary to consider these resources by guaranteeing loans for one- nonprofit organization, a county agency, existing resources to better utilize the to four-family housing located on and two agencies of the state of Hawaii. new assistance. In addition, NHHBG Hawaiian Home Lands. The comments received are organized funding may be used for the demolition or disposition of existing units, if the DATES: Effective Date: December 29, below in this section of the preamble to DHHL provides for this activity in its 2003. correspond to the rule section that is addressed by the comment. The HUD housing plan, even though the units FOR FURTHER INFORMATION CONTACT: response follows each comment. were not constructed with federal funds. Edward Fagan, Office of Native American Programs, Office of Public Section 1006.10 Definitions Section 1006.201 Eligible Affordable Housing Activities and Indian Housing, Department of Comment: The definition of ‘‘housing Housing and Urban Development, 451 area’’ should be expanded to include Comment: Because there are currently Seventh Street, SW., Washington, DC lands outside the jurisdiction of the no NAHASDA (more specifically, 20410–5000, telephone (202) 401–7914. Department of Hawaiian Home Lands NHHBG) assisted units on the Hawaiian (This is not a toll-free number.) (DHHL), and lands other than the Home Lands), NHHBG funds cannot be Individuals with speech-or hearing- Hawaiian home lands (Hawaiian Home used in existing communities. DHHL impairments may access this number Lands) because there are many native would like to enable existing through TTY by calling the toll-free Hawaiians who should qualify for communities to use NAHASDA funds Federal Information Relay Service at 1– assistance on the basis of income, but for model activities, resident 800–877–8339. have not received a DHHL lease. management and crime and safety SUPPLEMENTARY INFORMATION: HUD response: The language of the activities. definition of ‘‘housing area’’ in the rule HUD response: The eligible activities I. Background is the same language that appears as the in section 810 of the Act are ‘‘affordable Section 513 of the Hawaiian definition of ‘‘housing area’’ in section housing’’ activities. Subsection (b)(1) Homelands Homeownership Act of 801(5) of the Act, and HUD may not, by covers development of affordable 2000, Subtitle B of Title V of the regulation, substantively change this housing, subsection (b)(2) covers American Homeownership and statutory definition. housing-related services for affordable Economic Opportunity Act of 2000 Comment: In the definition of ‘‘Native housing, subsection (b)(3) covers (Pub. L. 106–569, approved December Hawaiian,’’ DHHL’s certification that an management services for affordable 27, 2000) (HHH Act) amends the Native individual is a bona fide lessee should housing, subsection (b)(4) covers crime American Housing Assistance and Self- be included as acceptable evidence that prevention and safety measures to Determination Act of 1996 (25 U.S.C. an individual is a Native Hawaiian, protect residents of affordable housing, 4101 et seq.) (NAHASDA) by adding a along with genealogical records, and subsection (b)(5) covers model new ‘‘Title VIII—Housing Assistance for verification by elders, and birth records. housing activities. Subpart C of the Native Hawaiians.’’ Title VIII (the Act) HUD response: Section 1006.301 sets regulations reflects the statutory establishes a program of block grant forth the statutory requirement that language. ‘‘Affordable housing’’ is assistance to provide affordable housing eligibility is limited to Native Hawaiian housing that complies with the for Native Hawaiians that is closely families who are eligible to reside on the requirements for affordable housing in

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66981

the statute and regulations. should not serve as a disincentive to Comment: Because the monthly Notwithstanding the fact that the provide affordable housing activities in maximum rent or lease-purchase housing in existing communities was existing communities. payment may not exceed 30 percent of not developed with NHHGB funds, HUD response: The authorizing a low-income family’s income, this cap NHHBG funds may be used to assist statute permits exceptions to the low- may preclude the establishment of flat existing communities if the existing income requirement and allows NHHBG rents or lease-purchase payments based housing complies with the requirements funds to be used for housing activities on operational costs or market factors. for affordable housing. HUD notes that under model programs that are designed HUD response: The 30 percent of under both section 813(b) of the Act (25 to carry out the purposes of title VIII of income requirement is statutory (25 U.S.C. 4232(b)) and, § 1006.305(d) of the the Act. The use of NHHBG funds under U.S.C. 4230(a)(2), section 811(a) of the regulations, housing assisted with the low-income exception and for model Act) and applies ‘‘in the case of any NHHBG funds pursuant to the exception activities both require HUD approval. low-income family.’’ Where a family to low-income requirement at section HUD encourages the submission of that is not low-income is assisted, if 809(a)(2)(B) of the Act (25 U.S.C. specific planned model activities and permitted under the exception 4228(a)(2)(B)), and § 1006.301(b) of the requests for exemptions for review with discussed earlier in this preamble, the regulations, shall be considered conformity to the Act’s requirements. 30 percent of income requirement does affordable housing for purposes of the Comment: The rule restricts the use of not apply. (See § 1006.310(c).) Act. funds to communities in which there Section 1006.315 Lease Requirements are existing NAHASDA-assisted units, Section 1006.220 Crime Prevention Comment: Currently DHHL will take and Safety Activities and prevents DHHL from strengthening or enabling existing communities with action against the lessee only if the Comment: DHHL would like to NAHASDA funds. [Note: Although the illegal activity is conducted on the provide services within existing comment spoke of ‘‘NAHASDA-assisted leased premises. communities, even if there are no units’’ and ‘‘NAHASDA funds’’ it is HUD response: The regulation allows NAHASDA-assisted units within the clear that NHHBG assistance is the this flexibility, and provides, at communities at the present time. intended subject.] § 1006.315(f), that ‘‘the DHHL, owner, or manager may terminate the tenancy.’’ HUD response: HUD’s response to the HUD response: HUD’s response to the (Emphasis added.) Termination is comment on § 1006.201 addresses this comment on § 1006.201 addresses this discretionary, not mandatory. issue. issue. Section 1006.225 Model Activities Comment: There may be a need to Section 1006.320 Tenant or Comment: DHHL would like to improve off-site infrastructure to access Homebuyer Selection provide services within existing DHHL property through non-DHHL Comment: DHHL plans to use current communities, even if there are no properties. The current rule appears to state administrative rules, which govern NAHASDA-assisted units within the preclude such projects. Expanding the the awarding of leases to applicants on communities at the present time. definition of ‘‘housing area’’ would the waiting lists for Hawaiian Home HUD response: HUD’s response to the allow funding of off-site infrastructure Lands with the addition of the comment on § 1006.201 addresses this improvements. NAHASDA income requirement for this issue. HUD response: Under section purpose. 810(b)(1) of the Act, the development of HUD response: The policies and Eligible Activities (Subpart C Generally) affordable housing may include both criteria adopted by the DHHL as Comment: In the case of activities site improvements and the development required by the Act, must be available such as site improvements or of utilities and utility services. Site for review by HUD, and the housing development of utilities that benefit the improvements must be on the site of the plan submitted annually by the DHHL whole community, ‘‘all units in a affordable housing. The affordable must contain a certification that the project should be considered as Eligible housing must be located on a ‘‘housing DHHL has such policies in effect. HUD Low-Income Families’’ if the families in area’’ which is defined by section 801(5) will bring any concerns it may have the project are existing residents and of the Act to mean an area of the with respect to such policies to the any of the following: Hawaiian Home Lands with respect to DHHL’s attention upon conducting such (a) The median income of the which the DHHL is authorized to reviews. Hawaiian Home Lands area in which provide assistance for affordable the project is located is less than 80 housing under the Act. Although the Section 1006.330 Insurance Coverage percent of the median income of the affordable housing must be located on Comment: Would HUD be required to state of Hawaii (based on the most the Hawaiian Home Lands, the utilities be named as an additional insured on recent U.S. Census data available); or need not necessarily be located there. homeowner units funded by the Act or (b) The project has a poverty rate of However, the utilities must be for the does the insurance requirement apply at least 20 percent; or affordable housing. only on rental units purchased or (c) The project is located in a low- constructed by DHHL with NAHASDA Section 1006.310 Rent and Lease- income area of the U.S. Treasury funds and owned and managed by Purchase Limitations Department’s Community Development DHHL? Financial Institutions (CDFI) Fund On- Comment: For rental and rent-to-own HUD response: The insurance line Help Desk Maps. units, each entering family must qualify requirement is intended to preserve the There should be criteria to qualify as low-income. For homeownership, NHHBG investment in affordable whole communities as low-income only the initial family must qualify as housing and not to provide any because where there are existing low-income. compensation to HUD. HUD is not residents, the effort to certify individual HUD response: The regulatory named as an additional insured on any families as low-income becomes an requirements reflect the statutory units, but the DHHL must require the imposition on the residents and requirements at section 813(a) of the Act owner of any rental or homeownership burdensome to the DHHL. The rule (25 U.S.C. 4232(a)). unit assisted with more than $5,000 of

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 66982 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

NHHBG funds to obtain insurance Section 1007.1 Purpose Section 184A loan guarantees is not sufficient to cover the replacement cost Comment: The purpose section of the limited to individual homebuyers, and of the unit. regulations states that HUD understands HUD wishes to emphasize the significant difference between the new Section 1006.335 Use of Nonprofit homestead leases have unique legal status; therefore, HUD is aware that Section 184A program and the Section Organizations and Public-Private 247 program. Partnerships homestead leases are not alienable. HUD response: Section 208(6) of the The Section 184A program does not Comment: Because of the limited Hawaiian Homes Commission Act merely duplicate the Section 247 number of experienced nonprofit (HHCA) provides that: program, which focuses exclusively on developers in Hawaii, the requirement loans to individual native Hawaiian The lessee, with the consent and approval families holding homestead leases. For to work with nonprofits to the extent of the commission, may mortgage or pledge practicable may serve as an obstacle to the lessee’s interest in the tract or reasons of efficiency and ease of the development of affordable housing. improvements thereon to a recognized administration, and to capitalize on familiarity in order to promote HUD response: The DHHL is in the lending institution authorized to do business as a lending institution in either the state or acceptance by the lending industry, best position to determine the extent to elsewhere in the United States; provided the HUD intends to administer both the which it is practicable to work with loan secured by a mortgage on the lessee’s Section 184A and Section 247 programs nonprofits. This requirement is not leasehold interest is insured or guaranteed by in a consistent manner with respect to intended to hinder the DHHL’s the Federal Housing Administration, individual, Native Hawaiian borrowers, affordable housing efforts. Department of Veterans Affairs, or any other federal agency and their respective who are eligible under either program. Section 1006.340 Treatment of successors and assigns, which are authorized But to fully implement, and derive the Program Income to insure or guarantee such loans, or any maximum benefit from, the Section acceptable private mortgage insurance as 184A program, HUD has concluded that Comment: New grant funds should be approved by the commission. The it will emphasize and strongly accessible even if there is available mortgagee’s interest in any such mortgage encourage the use of the Section 184A program income remaining, because it shall be freely assignable. Such mortgages, to program in ways that do not duplicate may be impracticable to exhaust all be effective, must be consented to and the Section 247 program. program income first. approved by the commission and recorded The conclusion for not having the with the department. HUD response: The requirement to Section 184A program duplicate the disburse program income first in The HHCA specifically permits the Section 247 program comes from HUD’s § 1006.340(b)(3) merely repeats the lessee of a homestead lease to pledge the consideration of the broader range of governmentwide requirements of Office lessee’s interest in the tract or eligible borrowers under the Section of Management and Budget (OMB) improvements, which provides a 184A program statute, the flexibility sufficient basis for mortgage lending to Circular A–102, ‘‘Administrative permitted for eligible collateral, and the proceed in the unique circumstances of Requirements for Grants and larger scale of the activities that may be the Hawaiian Home Lands. As a Cooperative Agreements to State, Local undertaken with the greater amount of practical matter, the federal and Federally Recognized Indian Tribal guaranteed funds available to a government’s insurance or guarantee of Governments,’’ which has been adopted borrower. HUD, therefore, strongly the loan, rather than the value of the by HUD at 24 CFR part 85. It is not encourages the use of Section 184A loan property, provides the actual financial necessary to exhaust all program income guarantees by the institutional security for a lender to an individual first as the comment states. Under 24 borrowers (DHHL, Office of Hawaiian Native Hawaiian borrower in these CFR 1006.340(c), if the total amount of Affairs, experienced nonprofits) transactions. Under the HHCA, general program income received in a single specifically made eligible under the leases are clearly alienable. year does not exceed $25,000, then the statute. These institutional borrowers HUD notes that nearly all of the may negotiate with lenders for larger amount is not considered program comments submitted on the Section income and is not subject to the loans, up to the limits HUD is 184A program address issues of loans to authorized to guarantee, to obtain requirement that it be disbursed before individual, Native Hawaiian borrowers disbursing additional NHHBG funds. financing for large-scale, integrated who hold homestead leases, the same infrastructure, homeownership Program income would not have to be group of borrowers directly served by disbursed unless and until it is development projects on the Hawaiian the existing Federal Housing Home Lands. Section 184A allows this determined that the $25,000 threshold Administration (FHA) Section 247 has been crossed. The requirement is type of community-wide, rather than mortgage insurance program. Because of single home, development and, to the intended to avoid the stockpiling and the unique status of Hawaiian Home fullest extent possible, HUD encourages non-use of program income. Lands, the Section 247 program focuses the use of the program for such projects. Section 1006.345 Labor Standards on loans to individual, Native Hawaiian Under such a project, for example, the borrowers. This focus is exemplified by DHHL could develop and pay for the Comment: DHHL partners with one of the principal purposes of the cost of a number of homes and nonprofits that use self-help and HHCA, ‘‘Preventing alienation of the fee supporting infrastructure, using a volunteer labor to bring down housing title to the lands set aside under this Act combination of NHHBG funds and costs for low-income families. These so that these lands will always be held Section 184A guaranteed loan proceeds. efforts would be hampered by a wage in trust for continued use by native The loan collateral could be any bonds requirement. Hawaiians in perpetuity,’’ HHCA or notes the DHHL is authorized to HUD response: Volunteer labor is § 101(b)(3)). This focus raises a number issue. The grant funds could cover the specifically exempted, under the of difficulties in implementation, among infrastructure costs, and the loan conditions specified in section 805(b)(2) them, issues concerning the security proceeds could cover the cost of the of the Act (25 U.S.C. 4225(b)(2)), and offered for a loan, and valuation of, homes. If the DHHL chooses to provide § 1006.345(d) of the regulations, from foreclosure on, and sale after foreclosure direct financing to a Native Hawaiian the wage requirement. of the security. However, the use of leaseholder for one of these homes, the

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66983

transaction would require no additional Section 1007.30 Security for Loan approval before the lessor may source of funding; the DHHL could offer Comment: Under § 1007.30(a), only terminate the lease while the mortgage a loan at the minimum rate necessary to the dwelling for which the loan is used is guaranteed or held by HUD, remain cover its repayment of the Section 184A is collateral for the loan. valid. loan; and any payments made by the HUD response: Where the borrower is Comment: Under § 1007.30(b)(3), leaseholder would be a direct offset of an individual, Native Hawaiian holder which addresses liquidation, only the cost of developing the home. HUD of a homestead lease, the lessee’s DHHL can cancel or award a lease. HUD response: The HUD response to would not have to guarantee or insure interest must always be included as the comment under § 1007.30(b)(2) these loans. Because the infrastructure collateral for the loan. This is consistent addresses this issue. was paid for by grant funds, the with Section 208(6) of the HHCA, and Comment: Under § 1007.30(b)(4), leaseholder/borrower is not paying back with the FHA Section 247 mortgage which addresses eviction procedures, these costs, only the loan guarantee insurance program. Where the borrower the DHHL’s Administrative Rules and costs of the home. Even if there were a is an entity other than an eligible Native Hawaii Revised Statutes provide number of successive defaults on a Hawaiian family, ‘‘any collateral procedures for ‘‘contested case home, the home could be offered at a authorized under and not prohibited by hearings’’ to allow lessees due process discounted price or shorter term to each federal or state law,’’ as provided by before a lease can be cancelled, which successive leaseholder, since the DHHL § 1007.30(a), may be used. lengthens the process time. A more is seeking only to recover its costs and Comment: Under § 1007.30(b), which realistic time requirement than 60 days repay its loans, not to make a profit. addresses Hawaiian Home Lands is 180 days to a year. Any gap in cash flow while a defaulting property interest as collateral, all leaseholder is evicted and a new HUD response: HUD does not intend homestead leases are inalienable. to impose unrealistic requirements. In leaseholder takes over would be limited HUD response: As noted earlier, HUD response to this comment, the last to the monthly payments as they come is aware of the restrictions preventing sentence of § 1007.30(b)(4), which due and not to the entire cost of the alienation of the fee title to the lands set contains this requirement, is removed. home. aside as Hawaiian Home Lands and Comment: Under § 1007.30(b)(4)(i), The use of Section 184A loan recognizes the limitations on which addresses enforcement, guarantees as described above may disposition of a homestead lease that reconsideration of lease cancellations, proceed under the rule at 24 CFR part has been mortgaged pursuant to section and court stays prolong the process. 1007 as currently written. HUD is 208(6) of the HHCA. However, HUD also HUD response: The HUD response to planning in a separate rule to propose notes the specific authority to ‘‘mortgage the comment under § 1007.30(b)(4) minimum financial viability and or pledge the lessee’s interest in the addresses this issue. development capacity and experience tract or improvements thereon.’’ requirements to determine what Comment: Under § 1007.30(b)(1), Section 1007.35 Loan Terms nonprofits are eligible for guarantees, which addresses approved leases, leases Comment: Because DHHL provides but this should not prevent planning of have evolved over the years, and DHHL land at no cost to native Hawaiians, Section 184A development projects would not want to be required to amend only the cost of the dwelling is assumed from proceeding. HUD welcomes the older leases. by the lessee; therefore, loan limits opportunity to work with the eligible HUD response: HUD is uncertain of should mirror the FHA Section 247 institutional borrowers to develop the circumstances under which an older program. Setting a high loan maximum viable projects on a case-by-case basis. lease would be at issue in a Section will limit DHHL’s ability to reaward The result of using the Section 184A 184A loan guarantee transaction, since existing homes, which have high values, program for this larger-scale refinancing is not an eligible activity. to waiting low-income families. development is anticipated to be an The statute for the Section 184 loan HUD response: HUD agrees with the increase in the production of affordable guarantee program was amended to comment. As noted earlier in this housing units on a more financially specifically authorize refinancing, and preamble, HUD intends to administer sound basis, while avoiding many of the such specific authorization is not both the Section 184A and Section 247 difficulties pointed out in the public present in Section 184A. Nevertheless, programs in a consistent manner, with comments, which focus on issues should a request for a Section 184A loan respect to individual, Native Hawaiian related to individual borrowers. To the guarantee present itself in the context of borrowers holding homestead leases. extent Section 184A loan guarantees are an older lease, HUD must reserve the right to approve the lease in order to Section 1007.40 Environmental sought for individual borrowers, the Requirements existing FHA Section 247 program protect its, and the public’s, financial model will be followed. interest, as it is obliged to do in all of Comment: A Finding of No its programs. Significant Impact (FONSI) should not Section 1007.20 Eligible Housing Comment: Under § 1007.30(b)(2), be required to be published for each which addresses assumption or sale of new construction loan made by Comment: The FHA Section 247 leasehold, title can only be transferred individual lessees to construct a house program accepts the building codes of to another native Hawaiian; neither on their homestead lot. The lessee the various counties, and the Section HUD nor the mortgagee can hold title. should not be burdened with the cost to 184A program should accept the same HUD response: HUD agrees with this publish a FONSI. requirements. comment, and plans to amend this HUD response: FONSIs result from HUD response: A new paragraph (d) section in a separate proposed rule. As environmental assessments under the is being added to § 1007.20 to provide a practical matter, the provisions of this National Environmental Policy Act that housing that meets the minimum paragraph with respect to obtaining title (NEPA). Under the environmental property standards for Section 247 to the leasehold interest cannot be reviews conducted by HUD under 24 mortgage insurance is deemed to meet executed, although the provisions CFR part 50, referenced in § 1007.40, the required housing safety and quality requiring the DHHL’s consent before activities under the Section 184A standards. any assumption of a lease, and HUD’s program may or may not require

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 66984 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

preparation of environmental 184A(i)(1)(A)(ii)(I) (12 U.S.C. 1715z– been submitted to the Office of assessments and FONSIs under NEPA, 13b(i)(1)(A)(ii)(I)), HUD agrees that this Management and Budget (OMB) for depending upon whether or not the comment identifies the difficulties of review under section 3507(d) of the activities are categorically excluded proceeding in accordance with the Paperwork Reduction Act of 1995 (44 from environmental assessment in statute where the borrower is an U.S.C. Chapter 35) and have been accordance with 24 CFR 50.20. individual, Native Hawaiian assigned OMB control number 2577– Categorically excluded activities require leaseholder, and the security for the 0200. In accordance with the Paperwork only review and compliance with the loan is the lessee’s interest in a Reduction Act, HUD may not conduct or other applicable environmental laws homestead lease. The foreclosure sponsor, and a person is not required to and authorities, and do not involve a process in these cases would have to respond to, a collection of information FONSI. If a FONSI or other findings are follow the procedure used for defaults unless the collection displays a required, HUD will prepare them. As under the Section 247 program. HUD currently valid OMB control number. noted in § 1007.40, HUD will also notes that these difficulties would not require documents similar to the be present in the case of any of the Environmental Impact builder’s certification required under 24 eligible institutional borrowers, where CFR 203.12(b)(2). The lessee is not the security for the loan would not be A Finding of No Significant Impact responsible for preparing the FONSI, the an interest of any kind in Hawaiian with respect to the environment was other findings, or the builder’s Home Lands property or where the made in accordance with HUD certification. borrower holds a general lease. This is regulations at 24 CFR part 50, which among the reasons that HUD is implement section 102(2)(C) of the Section 1007.50 Certificate of encouraging the use of the Section 184A National Environmental Policy Act of Guarantee program by the eligible institutional 1969 (42 U.S.C. 4332) at the interim rule Comment: After a lender has borrowers. stage of this rulemaking, and continues established credibility in packaging Comment: Under § 1007.75(a)(2)(ii), a to apply at this final rule stage. The Section 184A loans, HUD should loan could be assigned to HUD, HUD Finding of No Significant Impact is consider a direct guarantee process for pays the claim, DHHL cancels the lease, available for public inspection between local lenders. reawards the lease and repays HUD the the hours of 7:30 a.m. and 5:30 p.m. HUD response: HUD will consider amount recovered through sale. weekdays in the Office of General such an approach, although as HUD response: Again, HUD notes that Counsel, Regulations Division, Room discussed earlier, HUD intends to the situation contemplated by the 10276, Department of Housing and encourage the use of the Section 184A comment almost certainly involves an Urban Development, 451 Seventh Street, individual, leaseholder borrower, with program by institutional borrowers to SW., Washington, DC 20410–0500. conduct larger-scale development. the lessee’s interest as collateral, a situation that HUD intends to address in Executive Order 12866, Regulatory Section 1007.65 Transfer and a manner consistent with the Section Planning and Review Assumption 247 program, to the extent such Comment: DHHL should be notified transactions take place under Section OMB reviewed this rule under of any assignment of loan to another 184A. Executive Order 12866 (entitled servicer; assignment should be recorded ‘‘Regulatory Planning and Review’’). III. Changes to the Interim Rule in This OMB determined that this rule is a in DHHL’s recordation system. Final Rule HUD response: HUD agrees with the ‘‘significant regulatory action’’ as suggested change in this comment, The following changes to the June 13, defined in section 3(f) of the Order which will assist DHHL in monitoring 2002, interim rule are made by this final (although not economically significant, the status of outstanding loans in the rule, consistent with the discussion of as provided in section 3(f)(1) of the Section 184A program and taking an public comments in this preamble, and Order). Any changes made to the rule as active approach to prevent defaults. as further explained below: a result of that review are identified in Because this change would affect the 1. A new paragraph (d) is added to the docket file, which is available for responsibilities of servicers and has not § 1007.20 to provide that housing that public inspection in the Regulations been subject to notice and comment, it meets the minimum property standards Division, Room 10276, Office of the for Section 247 mortgage insurance is would be included in a proposed rule General Counsel, Department of deemed to meet the required housing HUD is planning to publish separately Housing and Urban Development, 451 from today’s rule. safety and quality standards. 2. The last sentence of Seventh Street, SW., Washington, DC Section 1007.75 Payment under § 1007.30(b)(4)(i), which uses 60 days to 20410–0500. Guarantee completion of eviction as a requirement Regulatory Flexibility Act Comment: Under § 1007.75(a)(1), for adequate enforcement, is removed. 3. HUD is removing the initial field which addresses notification, the lender The Secretary has reviewed this rule office review in the appeal process should also provide written notice to before publication and by approving it under § 1007.30(b)(4)(ii) to streamline DHHL if the borrower defaults. certifies, in accordance with the HUD response: The HUD response to the procedure from a three-step to a Regulatory Flexibility Act (5 U.S.C. the comment under § 1007.65 addresses two-step process. The initial request for 605(b)), that this rule would not have a this issue. a review is to be submitted directly to significant economic impact on a Comment: Under § 1007.75(a)(2)(i), the Deputy Assistant Secretary, Office of substantial number of small entities. which addresses foreclosure, the holder Native American Programs. This rule provides requirements for of guarantee cannot foreclose on a IV. Findings and Certifications administering a program of assistance to DHHL lease. provide affordable housing for a specific HUD response: Although Paperwork Reduction Act Statement population, Native Hawaiians, through a § 1007.75(a)(2)(i) basically tracks the The information collection single state agency, the Department of statutory language of Section requirements contained in this rule have Hawaiian Home Lands.

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66985

Unfunded Mandates Reform Act 24 CFR Part 1007 undesignated paragraph at the end of the Loan programs—Native Hawaiians, section to the end of newly revised Title II of the Unfunded Mandates (b)(4)(ii) to read as follows: Reform Act of 1995 (2 U.S.C. 1531– Native Hawaiians, Reporting and 1538) (UMRA) requires federal agencies recordkeeping requirements. § 1007.30 Security for loan. to assess the effects of their regulatory Catalog of Federal Domestic Assistance * * * * * actions on state, local, and tribal The Catalog of Federal Domestic (b) * * * governments and on the private sector. Assistance number for the Native (4) * * * This rule does not impose, within the Hawaiian Housing Block Grant program (i) Enforcement. If HUD determines meaning of the UMRA, any federal is 14.873, and for the Section 184A Loan that the DHHL has failed to enforce mandates on any state, local, or tribal Guarantees for Native Hawaiian adequately its eviction procedures, HUD governments or on the private sector. Housing program is 14.874. will cease issuing guarantees for loans ■ under this part except pursuant to Executive Order 13132, Federalism Accordingly, for the reasons stated in existing commitments. the preamble, the interim rule for parts Executive Order 13132 (entitled (ii) Review. If HUD ceases issuing 1006 and 1007 of chapter IX of title 24 guarantees for the DHHL’s failure to ‘‘Federalism’’) prohibits an agency from of the Code of Federal Regulations, publishing any rule that has federalism enforce its eviction procedures, HUD published on June 13, 2002, 67 FR 40774, shall notify the DHHL of such action implications if the rule either (1) is promulgated as final, with the imposes substantial direct compliance and that the DHHL may, within 30 days following amendments, to read as after notification of HUD’s action, file a costs on state and local governments follows: written appeal with the Deputy and is not required by statute, or (2) the Assistant Secretary, Office of Native rule preempts state law, unless the PART 1007—SECTION 184A LOAN American Programs (ONAP). Upon agency meets the consultation and GUARANTEES FOR NATIVE notification of an adverse decision by funding requirements of section 6 of the HAWAIIAN HOUSING the Deputy Assistant Secretary, the Order. This rule does not have ■ 1. The authority citation for 24 CFR DHHL has 30 additional days to file an federalism implications and does not part 1007 continues to read as follows: appeal with the Assistant Secretary for impose substantial direct compliance Public and Indian Housing. The costs on state and local governments or Authority: 12 U.S.C. 1715z-13b; 42 U.S.C. 3535(d). determination of the Assistant Secretary preempt state law within the meaning of shall be final, but the DHHL may ■ the Order. 2. In § 1007.20, add a new paragraph resubmit the issue to the Assistant (d) to read as follows: List of Subjects Secretary for review at any subsequent § 1007.20 Eligible housing. time if new evidence or changed 24 CFR Part 1006 circumstances warrant * * * * * reconsideration. * * * Community development block (d) Housing that meets the minimum grants, Grant programs—housing and property standards for Section 247 Dated: September 9, 2003. community development, Grant mortgage insurance (12 U.S.C. 1715z-12) Michael Liu, programs—Native Hawaiians, Low and is deemed to meet the required housing Assistant Secretary for Public and Indian moderate income housing, Native safety and quality standards. Housing. Hawaiians, Reporting and ■ 3. In § 1007.30, revise paragraphs [FR Doc. 03–29472 Filed 11–26–03; 8:45 am] recordkeeping requirements. (b)(4)(i) and (b)(4)(ii) and add the BILLING CODE 4668–33–P

VerDate jul<14>2003 19:55 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR2.SGM 28NOR2 Friday, November 28, 2003

Part IV

Department of Defense General Services Administration National Aeronautics and Space Administration 48 CFR Parts 15, 31, and 42 Federal Acquisition Regulation; Applicability of the Cost Principles and Penalties for Unallowable Costs; Proposed Rule

VerDate jul<14>2003 19:58 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\28NOP3.SGM 28NOP3 66988 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules

DEPARTMENT OF DEFENSE procedures of FAR part 31 apply • 10 U.S.C. 2324(b) requires the head whenever cost analysis is performed, of the agency to assess a penalty against GENERAL SERVICES regardless of whether cost or pricing the contractor if the contractor submits ADMINISTRATION data are obtained. a cost in its proposal for settlement that • This change is consistent with is expressly unallowable under a NATIONAL AERONAUTICS AND statute. 10 U.S.C. 2324 lists a number of ‘‘covered contract.’’ As indicated above, SPACE ADMINISTRATION costs that are unallowable on ‘‘covered a ‘‘covered contract’’ is a contract that contracts,’’ and 41 U.S.C. 256 extends is greater than $500,000. FAR 42.709 48 CFR Parts 15, 31, and 42 the statutory unallowable costs to uses this threshold to implement the statutory penalty provisions for [FAR Case 2001–018] civilian agencies. 10 U.S.C. 2324(1)(1)(A) defines a ‘‘covered claiming expressly unallowable costs. • RIN: 9000–AJ77 contract’’ as ‘‘a contract for an amount 10 U.S.C. 2324(1)(1)(B) provides for in excess of $500,000 that is entered adjusting the dollar threshold of a Federal Acquisition Regulation; into by the head of an agency, except ‘‘covered contract’’ to account for Applicability of the Cost Principles and that such term does not include a fixed- inflation. This adjustment from Penalties for Unallowable Costs price contract without cost incentives or $500,000 to $550,000 is consistent with the adjustment of the Truth in AGENCIES: Department of Defense (DoD), any firm fixed-price contract for the Negotiations Act threshold recently General Services Administration (GSA), purchase of commercial items.’’ part 31 implemented in Item II of Federal and National Aeronautics and Space cost principles continue to apply to Acquisition Circular 97–20; and Administration (NASA). covered contracts. • • Makes several editorial changes, ACTION: Proposed rule. This change is consistent with a including deleting the phrase ‘‘or any goal of the Councils to reduce firm-fixed-price contract for the SUMMARY: The Civilian Agency government-unique regulations when purchase of commercial items’’ at FAR Acquisition Council and the Defense the risk to the Government is low. 42.709(b) and FAR 42.709–6, since this Acquisition Regulations Council • Adds a definition to FAR 31.001 for type of contract is included in the class (Councils) are proposing to amend the fixed-price contracts, subcontracts and of contracts (fixed-price contracts Federal Acquisition Regulation (FAR) to modifications. The Councils are without cost incentives) already remove the requirement to apply cost particularly interested in obtaining addressed at these FAR sites. principles and procedures when pricing comments regarding this proposed a contract if cost or pricing data are not definition. We are also asking for public B. Regulatory Planning and Review obtained, and to increase the contract input regarding the following alternative This is not a significant regulatory dollar threshold for assessing a penalty definition, which has been considered action and, therefore, was not subject to if the contractor includes expressly by the Councils, and which was review under Section 6(b) of Executive unallowable costs in its claim for published on July 3, 2003 (68 FR 40104) Order 12866, Regulatory Planning and reimbursement. as part of a proposed rule for FAR case Review, dated September 30, 1993. This DATES: Interested parties should submit 1999–025, Cost Accounting Standards rule is not a major rule under 5 U.S.C. comments in writing on or before Administration: The public comment 804. period on that case is closed. January 27, 2004 to be considered in the C. Regulatory Flexibility Act formulation of a final rule. Fixed-price contracts and subcontracts The Councils do not expect this ADDRESSES: Submit written comments means— proposed rule to have a significant to—General Services Administration, (1) Fixed-price contracts and subcontracts economic impact on a substantial FAR Secretariat (MVA), 1800 F Street, described at 16.202, 16.203, and 16.207; number of small entities within the NW., Room 4035, ATTN: Laurie Duarte, (2) Fixed-price incentive contracts and subcontracts where the price is not adjusted meaning of the Regulatory Flexibility Washington, DC 20405. based on actual costs incurred (Subpart 16.4); Act, 5 U.S.C. 601, et seq., because most Submit electronic comments via the (3) Orders issued under indefinite-delivery contracts awarded to small entities use Internet to—farcase.2001–[email protected]. contracts and subcontracts where final simplified acquisition procedures or are Please submit comments only and cite payment is not based on actual costs incurred awarded on a competitive, fixed-price FAR case 2001–018 in all (Subpart 16.5); and basis, and do not require application of correspondence related to this case. (4) The fixed hourly rate portion of the time-and-materials and labor-hours contracts the cost principles and procedures FOR FURTHER INFORMATION CONTACT: The and subcontracts (Subpart 16.6). discussed in this rule. An Initial FAR Secretariat at (202) 501–4755 for Regulatory Flexibility Analysis has, information pertaining to status or • Raises the dollar threshold for therefore, not been performed. We invite publication schedules. For clarification including the contract clause at FAR comments from small businesses and of content, contact Mr. Edward Loeb, 52.242–3, Penalties for Unallowable other interested parties. The Councils Policy Adviser, at (202) 501–0650. Costs, in solicitations and contracts. The will consider comments from small Please cite FAR case 2001–018. clause covers the assessment of entities concerning the affected FAR SUPPLEMENTARY INFORMATION: penalties against a contractor that Parts 15, 31, and 42 in accordance with includes unallowable indirect costs in A. Background 5 U.S.C. 610. Interested parties must its final indirect cost rate proposal or in submit such comments separately and The proposed rule— its final statement of costs incurred or should cite 5 U.S.C. 601, et seq. (FAR • Narrows the scope of FAR part 31. estimated to be incurred under a fixed- case 2001–018), in correspondence. The rule would amend the FAR to price incentive contract. Currently, the indicate that the cost principles and contracting officer must include the D. Paperwork Reduction Act procedures of FAR part 31 do not apply contract clause in certain solicitations The Paperwork Reduction Act does to the pricing of fixed-price contracts if and contracts over $500,000. The rule not apply because the proposed changes cost or pricing data are not obtained. would increase the dollar threshold to the FAR do not impose information Currently, the cost principles and from $500,000 to $550,000. collection requirements that require the

VerDate jul<14>2003 19:58 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP3.SGM 28NOP3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Proposed Rules 66989

approval of the Office of Management (1) Fixed-price contracts, on a fixed-price basis where cost or and Budget under 44 U.S.C. 3501, et subcontracts, and modifications pricing data is not obtained. seq. described at 16.202, 16.203 (except * * * * * 16.203–1(b)) and 16.207; List of Subjects in 48 CFR Parts 15, 31, (2) Fixed-price incentive contracts, 7. Amend section 31.105 by revising and 42 subcontracts, and modifications where paragraph (b) to read as follows: Government procurement. the price is not adjusted based on actual 31.105 Construction and architect- Dated: November 21, 2003. costs incurred (Subpart 16.4); engineer contracts. Laura Auletta, (3) The fixed hourly rate portion of * * * * * Director, Acquisition Policy Division. time-and-materials and labor-hour contracts, subcontracts, and (b) Except as otherwise provided in Therefore, DoD, GSA, and NASA paragraph (d) of this section, the cost propose amending 48 CFR parts 15, 31, modifications where the rate is not adjusted based on actual costs incurred principles and procedures in Subpart and 42 as set forth below: 31.2 shall be used in the pricing of 1. The authority citation for 48 CFR (Subpart 16.6); and (4) Orders issued under indefinite- contracts, subcontracts, and contract parts 15, 31, and 42 is revised to read modifications in this category if cost as follows: delivery contracts (Subpart 16.5) using one of the contract types in paragraphs analysis is performed (see 15.404–1(c)), Authority: 40 U.S.C. 121(c); 10 U.S.C. (1) through (3) of this definition. except contracts, subcontracts, and chapter 137; and 42 U.S.C. 2473(c). modifications issued on a fixed-price * * * * * basis where cost or pricing data is not PART 15—CONTRACTING BY 5. Revise section 31.102 to read as obtained. NEGOTIATION follows: * * * * * 31.102 Fixed-price contracts. 2. Amend section 15.404–1 by 8. Amend section 31.106–1 by revising paragraph (c)(2)(iv) to read as (a) The applicable subparts of part 31 revising the third sentence of the follows: shall be used in the pricing of fixed- introductory paragraph to read as price contracts, subcontracts, and 15.404–1 Proposal analysis techniques. follows: modifications to contracts and * * * * * subcontracts when— 31.106–1 Applicable cost principles. (c) * * * (1) Cost analysis is performed, except * * * Whichever cost principles are (2) * * * contracts, subcontracts, and (iv) When applicable, verification that appropriate will be used in the pricing modifications issued on a fixed-price the offeror’s cost submissions are in of facilities contracts, subcontracts, and basis where cost or pricing data is not accordance with the contract cost contract modifications in this category if obtained; or principles and procedures in part 31 (2) A fixed-price contract clause cost analysis is performed (see 15.404– and the requirements and procedures in requires the determination or 1(c)), except contracts, subcontracts, and 48 CFR Chapter 99 (Appendix to the negotiation of costs. modifications issued on a fixed-price FAR looseleaf edition), Cost Accounting (b) Application of cost principles to basis where cost or pricing data is not Standards. fixed-price contracts and subcontracts obtained. * * * * * * * * must not be construed as a requirement * * * * * to negotiate agreements on individual PART 31—CONTRACT COST elements of cost in arriving at agreement PART 42—CONTRACT PRINCIPLES AND PROCEDURES on the total price. The final price ADMINISTRATION AND AUDIT SERVICES 3. Amend section 31.000 by revising accepted by the parties reflects paragraph (a) to read as follows: agreement only on the total price. (c) Further, notwithstanding the 9. Amend section 42.709 by revising 31.000 Scope of part. mandatory use of cost principles, the paragraph (b) to read as follows: * * * * * objective will continue to be to negotiate 42.709 Scope. (a) The pricing of contracts, prices that are fair and reasonable, cost * * * * * subcontracts, and modifications to and other factors considered. contracts and subcontracts whenever 6. Amend section 31.103 by revising (b) This section applies to contracts in cost analysis is performed (see 15.404– paragraph (a) to read as follows: excess of $550,000, except fixed-price 1(c)), except contracts, subcontracts, and contracts without cost incentives. modifications issued on a fixed-price 31.103 Contracts with commercial organizations. 10. Amend section 42.709–6 by basis where cost or pricing data is not revising the first sentence to read as obtained; and * * * * * follows: * * * * * (a) The cost principles and procedures 4. Amend section 31.001 by adding, in Subpart 31.2 and agency supplements 42.709–6 Contract clause. shall be used in pricing negotiated in alphabetical order, the definition Insert the clause at 52.242–3, supply, service, experimental, ‘‘Fixed-price contracts, subcontracts, Penalties for Unallowable Costs, in developmental, and research contracts, and modifications’’ to read as follows: solicitations and contracts over subcontracts, and contract modifications $550,000, except fixed-price contracts 31.001 Definitions. with commercial organizations without cost incentives. * * * * * * * * whenever cost analysis is performed Fixed-price contracts, subcontracts, (see 15.404–1(c)), except contracts, [FR Doc. 03–29640 Filed 11–26–03; 8:45 am] and modifications means— subcontracts, and modifications issued BILLING CODE 6820–EP–P

VerDate jul<14>2003 19:58 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 E:\FR\FM\28NOP3.SGM 28NOP3 Friday, November 28, 2003

Part V

Securities and Exchange Commission 17 CFR Parts 228, 229, 240 et al. Disclosure Regarding Nominating Committee Functions and Communications Between Security Holders and Boards of Directors; Final Rule

VerDate jul<14>2003 20:36 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\28NOR3.SGM 28NOR3 66992 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

SECURITIES AND EXCHANGE Washington, DC 20549–0609. information required by Item 401 of COMMISSION Comments also may be submitted Regulations S–K and S–B. electronically at the following e-mail I. Background 17 CFR Parts 228, 229, 240, 249, 270 address: [email protected]. All and 274 comment letters should refer to File No. On August 8, 2003, we proposed new [Release Nos. 33–8340; 34–48825; IC– S7–14–03. This number should be disclosure standards intended to 26262; File No. S7–14–03] included in the subject line if sent via increase the transparency of nominating electronic mail. Electronically committee functions and the processes RIN 3235–AI90 submitted comment letters will be by which security holders may communicate with boards of directors of Disclosure Regarding Nominating posted on the Commission’s Internet the companies in which they invest.16 Committee Functions and Web site (http://www.sec.gov). We do The disclosure standards that we adopt Communications Between Security not edit personal information, such as today are, in most respects, those Holders and Boards of Directors names or electronic mail addresses, from electronic submissions. You proposed on August 8, 2003. Overall, AGENCY: Securities and Exchange should submit only information that most commenters supported new Commission. you wish to make available publicly. disclosure standards relating to ACTION: Final rule. nominating committee functions and FOR FURTHER INFORMATION CONTACT: security holder communications with SUMMARY: We are adopting new Lillian C. Brown, at (202) 942–2920, directors;17 however, as noted below, disclosure requirements and Andrew Thorpe, at (202) 942–2910, or we received a number of comments and amendments to existing disclosure Andrew Brady, at (202) 942–2900, in the suggestions with regard to specific requirements to enhance the Division of Corporation Finance, or with components of the proposed disclosure transparency of the operations of boards respect to investment companies, standards.18 We have revised some of directors. Specifically, we are Christian L. Broadbent, at (202) 942– elements of the proposed disclosure adopting enhancements to existing 0721, in the Division of Investment standards in response to these disclosure requirements regarding the Management, U.S. Securities and comments and suggestions. operations of board nominating Exchange Commission, 450 Fifth Street, The requirements we proposed on committees and a new disclosure NW., Washington DC 20549. August 8, 2003,19 and are adopting requirement concerning the means, if SUPPLEMENTARY INFORMATION: We are today, follow in many respects the any, by which security holders may adopting amendments to Item 4011 of recommendations made by the Division communicate with directors. These Regulation S–B 2 and Item 4013 of of Corporation Finance in a report rules require disclosure but do not Regulation S–K 4 under the Securities provided to the Commission on July 15, mandate any particular action by a 20 Act of 1933,5 Items 7 and 22 of Schedule 2003. This report resulted from our company or its board of directors; 14A 6 under the Securities Exchange Act , 2003 directive to the Division rather, the new disclosure requirements to review the proxy rules relating to the of 1934,7 Rule 30a–28 under the are intended to make more transparent election of corporate directors.21 In Investment Company Act of 1940,9 to security holders the operation of the preparing the report and developing its Forms 10–Q 10 and 10–QSB 11 under the boards of directors of the companies in recommendations, the Division Exchange Act, and Form N–CSR 12 which they invest. considered the input of members of the under the Exchange Act and the DATES: investing, business, legal, and academic Effective Date: January 1, 2004. Investment Company Act. Although we Compliance Dates: Registrants must communities.22 The majority of these are not adopting amendments to comply with these disclosure Schedule 14C 13 under the Exchange requirements in proxy or information 16 See Release No. 34–48301 (August 8, 2003) [68 Act, the amendments will affect the statements that are first sent or given to FR 48724]. Comments received in response to the disclosure provided in Schedule 14C, as proposals, as well as a summary of these comments security holders on or after January 1, Schedule 14C requires disclosure of (‘‘Summary of Comments’’) may be found in File 2004, and in Forms 10–Q, 10–QSB, 10– some items of Schedule 14A. Similarly, No. S7–14–03 and on our Web site at http:// K, 10–KSB, and N–CSR for the first www.sec.gov. although we are not adopting 17 See Summary of Comments—File No. S7–14– reporting period ending after January 1, 14 2004. Registrants may comply amendments to Forms 10–K and 10– 03. 15 18 See id. voluntarily with these disclosure KSB under the Exchange Act, the amendments to Item 401 of Regulations 19 See Release No. 34–48301 (August 8, 2003). requirements before the compliance 20 S–B and S–K will affect the disclosure The Division also recommended that we date. propose amendments to the proxy rules regarding Comments: Comments regarding the under Forms 10–K and 10–KSB, as the inclusion in company proxy materials of ‘‘collection of information’’ those forms require disclosure of the security holder nominees for election as directors. Our proposals regarding this issue were included in requirements, within the meaning of the a separate release. See Release No. 34–48626 1 17 CFR 228.401. Paperwork Reduction Act of 1995, of (October 14, 2003) [68 FR 60784]. As such, this 2 Regulations S–B and S–K, and Forms 17 CFR 228.10 et seq. adopting release does not address that issue 3 10–Q, 10–QSB, 10–K, 10–KSB, and N– 17 CFR 229.401. directly. The Division’s Staff Report to the 4 17 CFR 229.10 et seq. Commission, detailing the results of its review of CSR should be received by January 1, 5 15 U.S.C. 77a et seq. the proxy process related to the nomination and 2004. 6 17 CFR 240.14a–101. election of directors, can be found on our Web site ADDRESSES: To help us process and 7 15 U.S.C. 78a et seq. at http://www.sec.gov. Staff Report: Review of the 8 17 CFR 270.30a–2. Proxy Process Regarding the Nomination and review your comments more efficiently, Election of Directors, Division of Corporation 9 15 U.S.C. 80a–1 et seq. comments should be sent by one Finance (July 15, 2003). 10 17 CFR 249.308a. 21 See Press Release No. 2003–46 (April 14, 2003). method—U.S. mail or electronic mail— 11 17 CFR 249.308b. 22 On May 1, 2003, we solicited public views on only. Comments should be submitted in 12 17 CFR 249.331 and 17 CFR 274.128. the Division’s review of the proxy rules relating to triplicate to Jonathan G. Katz, Secretary, 13 17 CFR 240.14c–101. the nomination and election of directors. See U.S. Securities and Exchange 14 17 CFR 249.310. Release No. 34–47778 (May 1, 2003) [68 FR 24530]. Commission, 450 Fifth Street, NW., 15 17 CFR 249.310b. In addition to receiving written comments, the

VerDate jul<14>2003 20:36 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66993

commenters supported our decision to disclosure is intended to provide In addition, as noted in the proposing direct the review and, reflecting concern security holders with additional, release,27 we believe that information as over corporate director accountability specific information upon which to to whether nominating committee and recent corporate scandals, generally evaluate the boards of directors and members are independent within the urged us to adopt rules that would grant nominating committees of the requirements of listing standards security holders greater access to the companies in which they invest. applicable to a company is meaningful nomination process and greater ability Further, we intend that increased to security holders in evaluating the to exercise their rights and transparency of the nomination process nomination process of a company, how responsibilities as owners of their will make that process more that process works, and the seriousness companies.23 Many of the comments understandable to security holders. In with which the nomination process is received in connection with the particular, we are adopting a number of considered by a company. Further, Division’s review evidenced a growing specific and detailed disclosure information regarding the persons who concern among security holders that requirements because we believe that recommended each nominee and they lack sufficient input into decisions disclosure in response to each of these disclosure as to whether there are third made by the boards of directors of the requirements will assist security holders parties that receive compensation companies in which they invest.24 Two in understanding each of the processes related to identifying and evaluating particular areas of concern related to the and policies of nominating committees candidates will provide important nomination of candidates for election as and boards of directors regarding the information as to the process followed director and the ability of security nomination of candidates for director. by a company. holders to communicate effectively with Detailed disclosure regarding The ability to participate in the members of boards of directors.25 We nomination processes will provide nomination process is an important seek to address these concerns with the security holders with important matter for security holders.28 new disclosure standards we are information regarding the management Accordingly, we believe that it is adopting today. and oversight of the companies in important for security holders to which they invest. The specific understand the specific application of II. New Disclosure Requirements disclosure requirements we are adopting the nomination processes to candidates A. Disclosure Regarding Nominating today will cause companies to provide put forward by security holders. Committee Processes security holders with that information. Disclosure as to whether and how they We believe that specific, detailed may participate in a company’s 1. Discussion disclosure requirements are necessary nomination process, and the manner in We are adopting new proxy statement and appropriate to assure that investors which their candidates are evaluated, disclosure requirements that will are provided with disclosure that including differences between how their provide greater transparency regarding presents the desired degree of clarity candidates and how other candidates the nominating committee and the and transparency. In the absence of are evaluated, therefore, represents nomination process.26 This enhanced these specific disclosure requirements, important information for security we believe that disclosure could be at a holders. Finally, an additional, specific Division spoke with a number of interested parties level of generality that would not be disclosure requirement regarding the representing security holders, the business sufficiently useful to security holders. treatment of candidates put forward by community, and the legal community. Each of the Each of the requirements we are comment letters received, memoranda documenting large security holders or groups of the Division’s meetings, and a summary of the adopting today furthers the goal of security holders that have a long-term comments (‘‘Summary of Comments’’) may be providing the transparency that is investment interest is appropriate, as it found in File No. S7–10–03 and on our Web site, necessary for security holders to will provide investors with information http://www.sec.gov. Summary of Comments in understand the nomination process. For Response to the Commission’s Solicitation of Public that is useful in assessing the actions of Views Regarding Possible Changes to the Proxy example, the rules we are adopting the nominating committee. Rules (July 15, 2003). requiring disclosure of the following 2. Disclosure Requirements 23 See Summary of Comments—File No. S7–10– matters are necessary to give security 03. holders a more complete overview of The amendments we are adopting 24 See id. today will expand the current proxy 25 the nomination process for directors of See id. the companies in which they invest: statement disclosure regarding a 26 Prior to the effectiveness of these amendments, • companies must disclose whether they have a A company’s determination company’s nominating or similar nominating committee and, if so, whether that whether to have a nominating committee to include: committee considers nominees recommended by committee; • A statement as to whether the security holders and how any such • The nominating committee’s company has a standing nominating recommendations may be submitted. See committee or a committee performing Paragraphs (d)(1) and (d)(2) of Item 7 of Exchange charter, if any; • 29 Act Schedule 14A. See also Release No. 34–15384 The nominating committee’s similar functions and, if the company (December 6, 1978) [43 FR 58522], in which the processes for identifying and evaluating does not have a standing nominating Commission adopted these disclosure standards. In candidates; and committee or committee performing the 1978 release proposing these disclosure • The minimum qualifications for a similar functions, a statement of the requirements, the Commission stated generally its belief that the new disclosure requirements would nominating committee-recommended basis for the view of the board of facilitate improved accountability and, more nominee and any qualities and skills directors that it is appropriate for the specifically, that: that the nominating committee believes company not to have such a committee [I]nformation relating to nominating committees are necessary or desirable for board and identification of each director who would be important to security holders because a members to possess. nominating committee can, over time, have a significant impact on the composition of the board 27 See Release No. 34–48301 (August 8, 2003). and also can improve the director selection process increasing security holder participation in the 28 See Release No. 34–14970 (July 18, 1978). See by increasing the range of candidates under corporate electoral process, a subject which the also Summary of Comments ‘‘File No. S7–10–03 consideration and intensifying the scrutiny given to Commission will consider further in connection and Summary of Comments ‘‘File No. S7–14–03. their qualifications. Additionally, the Commission with its continuing proxy rule re-examination. 29 As noted earlier in this release, this disclosure believes that the institution of nominating Release No. 34–14970 (July 18, 1978) [43 FR currently is required under Paragraph (d)(1) of Item committees can represent a significant step in 31945]. 7 of Exchange Act Schedule 14A.

VerDate jul<14>2003 20:36 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 66994 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

participates in the consideration of defined in the listing standards • If the nominating committee will director nominees;30 applicable to the listed issuer;37 consider candidates recommended by • The following information • If the company is not a listed security holders, a description of the regarding the company’s director issuer,38 disclosure as to whether each procedures to be followed by security nomination process:31 of the members of the nominating holders in submitting such • If the nominating committee has a committee is independent. In recommendations;42 charter, disclosure of whether a current determining whether a member is • A description of any specific, copy of the charter is available to independent, the company must use a minimum qualifications that the security holders on the company’s Web definition of independence of a national nominating committee believes must be site. If the nominating committee has a securities exchange registered pursuant met by a nominating committee- charter and a current copy of the charter to section 6(a) of the Exchange Act or a recommended nominee for a position on is available to security holders on the national securities association registered the company’s board of directors, and a company’s Web site, disclosure of the pursuant to section 15A(a) of the description of any specific qualities or company’s Web site address. If the Exchange Act that has been approved by skills that the nominating committee nominating committee has a charter and the Commission (as that definition may believes are necessary for one or more a current copy of the charter is not be modified or supplemented), and state of the company’s directors to possess;43 available to security holders on the which definition it used. Whatever • A description of the nominating company’s Web site, inclusion of a copy definition the company chooses, it must committee’s process for identifying and of the charter as an appendix to the apply that definition consistently to all evaluating nominees for director, company’s proxy statement at least once members of the nominating committee including nominees recommended by every three fiscal years. If a current copy and use the independence standards of security holders, and any differences in of the charter is not available to security the same national securities exchange or the manner in which the nominating holders on the company’s Web site, and national securities association for committee evaluates nominees for is not included as an appendix to the purposes of nominating committee director based on whether the nominee disclosure under this requirement and is recommended by a security holder;44 company’s proxy statement, • identification of the prior fiscal year in audit committee disclosure required With regard to each nominee which the charter was so included in under Item 7(d)(3)(iv) of Exchange Act approved by the nominating committee 32 Schedule 14A;39 for inclusion on the company’s proxy satisfaction of the requirement; • • If the nominating committee does If the nominating committee has a card (other than nominees who are not have a charter, a statement of that policy with regard to the consideration executive officers or who are directors fact;33 of any director candidates standing for re-election), a statement as • If the company is a listed issuer 34 recommended by security holders, a to which one or more of the following whose securities are listed on a national description of the material elements of categories of persons or entities securities exchange registered pursuant that policy, which shall include, but recommended that nominee: security to section 6(a) of the Exchange Act 35 or need not be limited to, a statement as to holder, non-management director, chief in an automated inter-dealer quotation whether the committee will consider executive officer, other executive system of a national securities director candidates recommended by officer, third-party search firm, or other, 40 45 association registered pursuant to security holders; specified source; • • If the company pays a fee to any section 15A(a) of the Exchange Act 36 If the nominating committee does third party or parties to identify or that has independence requirements for not have a policy with regard to the consideration of any director candidates evaluate or assist in identifying or nominating committee members, recommended by security holders, a disclosure as to whether the members of statement of that fact and a statement of 42 Prior to the effectiveness of these amendments, the nominating committee are the basis for the view of the board of this disclosure is required under Paragraph (d)(2) of independent, as independence for Item 7 of Exchange Act Schedule 14A. As a result directors that it is appropriate for the of the amendments to Item 7 of Exchange Act nominating committee members is 41 company not to have such a policy; Schedule 14A that we are adopting today, this requirement will be moved to new Paragraph 30 See new Paragraph (d)(2)(i) of Item 7 of 37 (d)(2)(ii)(G) of Item 7 of Exchange Act Schedule Exchange Act Schedule 14A. See new Paragraph (d)(2)(ii)(C) of Item 7 of Exchange Act Schedule 14A. 14A. In addition, we are adopting a new 31 For the remainder of our discussion of this 38 As defined in Exchange Act Rule 10A–3. requirement in Regulations S–B and S–K, and a disclosure requirement, the term ‘‘nominating 39 new reference to that requirement in Exchange Act committee’’ refers to a nominating committee or See new Paragraph (d)(2)(ii)(D) of Item 7 of Exchange Act Schedule 14A. Forms 10–Q and 10–QSB, that will require similar committee or group of directors fulfilling companies to disclose any material changes to the 40 See new Paragraph (d)(2)(ii)(E) of Item 7 of the role of a nominating committee. That group may procedures that were previously disclosed pursuant Exchange Act Schedule 14A. As adopted, this comprise the full board. See the Instruction to new to this item. See new Paragraph (b) of Item 5 of Part disclosure requirement specifies that the company’s Paragraph (d)(2)(ii) of Item 7 of Exchange Act II to Exchange Act Forms 10–Q and 10–QSB, new description of the material elements of its policy Schedule 14A. If the company has a standing Paragraph (g) of Item 401 of Exchange Act with regard to consideration of security holder nominating committee or a committee fulfilling the Regulation S–B, and new Paragraph (j) of Item 401 candidates ‘‘need not’’ be limited to a statement as role of a nominating committee, Item 7(d)(1) of of Exchange Act Regulation S–K. In those instances Exchange Act Schedule 14A requires identification to whether the nominating committee will consider security holder-recommended candidates. This where a material change is implemented during the of the members of that committee. If the company last quarter of a company’s fiscal year, companies does not have such a standing committee, new revision was made in response to a commenter’s concern that the proposed requirement (that the will be required to include disclosure of such Paragraph (d)(2)(i) of Item 7 of Exchange Act change in their Exchange Act Form 10–K or 10– Schedule 14A will require identification of each disclosure ‘‘shall not’’ be limited to a statement as to whether the committee will consider security KSB. See Item 10 of Part III of Exchange Act Form director who participates in the consideration of 10–K, Item 9 of Part III of Exchange Act Form 10– director nominees. holder recommended candidates) implied that a company could not merely have a policy of KSB, new Paragraph (g) of Item 401 of Exchange Act 32 See new Paragraph (d)(2)(ii)(A) of Item 7 of considering security holder recommended Regulation S–B, and new Paragraph (j) of Item 401 Exchange Act Schedule 14A. candidates, but instead was required to put in place of Exchange Act Regulation S–K. 33 See new Paragraph (d)(2)(ii)(B) of Item 7 of a more detailed policy with respect to consideration 43 See new Paragraph (d)(2)(ii)(H) of Item 7 of Exchange Act Schedule 14A. of such candidates. See Committee on Federal Exchange Act Schedule 14A. 34 As defined in Exchange Act Rule 10A–3 [17 Regulation of Securities of the American Bar 44 See new Paragraph (d)(2)(ii)(I) of Item 7 of CFR 240.10A–3]. Association’s section of Business Law (‘‘ABA’’). Exchange Act Schedule 14A. 35 15 U.S.C. 78f(a). 41 See new Paragraph (d)(2)(ii)(F) of Item 7 of 45 See new Paragraph (d)(2)(ii)(J) of Item 7 of 36 15 U.S.C. 78o–3(a). Exchange Act Schedule 14A. Exchange Act Schedule 14A.

VerDate jul<14>2003 20:54 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66995

evaluating potential nominees, and the security holder or security every three years (as is the case for audit disclosure of the function performed by holder group that recommended the committee charters).55 each such third party;46 and candidate and disclosure as to whether The disclosure standard that we are • If the company’s nominating the nominating committee chose to adopting today does not include the committee received, by a date not later nominate the candidate, provided, proposed requirement that companies than the 120th calendar day before the however, that no such identification or describe the material terms of the date of the company’s proxy statement disclosure is required without the nominating committee charter. released to security holders in written consent of both the security Companies will, instead, be required to connection with the previous year’s holder or security holder group and the disclose whether a current copy of the annual meeting, a recommended candidate to be so identified.49 charter is available to security holders nominee from a security holder that on the company’s Web site. Where a beneficially owned more than 5% of the 3. Comments Regarding, and Revisions company does not make the charter company’s voting common stock for at to, the Proposed Disclosure available on its Web site, the company least one year as of the date the Requirements would be required to include a copy of recommendation was made, or from a In response to our request for the charter as an appendix to its proxy group of security holders that comment on the proposed nominating statement at least once every three fiscal beneficially owned, in the aggregate, committee disclosure requirements, a years and, in those proxy statements more than 5% of the company’s voting that do not include the charter as an 47 majority of commenters who supported common stock, with each of the the proposed rules believed that appendix, the company would be securities used to calculate that required to identify in which of the increased disclosure about nominating ownership held for at least one year as prior years the charter was so included. committee processes would be effective of the date the recommendation was We believe that this disclosure standard in increasing security holder made,48 identification of the candidate will provide security holders with the understanding of the nomination information regarding a company’s process,50 board accountability,51 board 46 See new Paragraph (d)(2)(ii)(K) of Item 7 of nominating committee that was sought responsiveness,52 and a company’s Exchange Act Schedule 14A. in the proposal, without unduly 47 corporate governance policies.53 With Our use of a more than 5% beneficial burdening companies. ownership threshold to trigger this additional regard to the particular components of disclosure obligation means that recommendations the proposed disclosure standards, b. Independence of Nominating generally will be made by security holders or groups that have a reporting obligation under commenters provided more specific Committee Members Exchange Act Regulation 13D [17 CFR 240.13d– input, which we considered carefully in In response to the proposed 240.13d–102]. Recommending security holders, like revising certain of the disclosure disclosure requirement that listed other beneficial owners, will continue to report on standards that we are adopting today. Exchange Act Schedule 13G [17 CFR 240.13d–102] issuers disclose any instance during the or Exchange Act Schedule 13D [17 CFR 240.13d– a. Nominating Committee Charter prior fiscal year in which any member 101] based on their purpose or effect in acquiring of the nominating committee did not or holding the company’s securities. That Commenters generally were of the determination is not intended to be affected by our satisfy the definition of independence adoption of this new disclosure obligation. In view that summary disclosure of the included in the listing standards to addition, we anticipate that security holders may material terms of the nominating which the company is subject, a number communicate with each other in an effort to committee’s charter within a company’s of commenters suggested that we revise aggregate more than 5% of a company’s securities or delete this requirement.56 At least before submitting a recommended candidate to a proxy statement was unnecessary and company’s nominating committee. The would lead to excessively lengthy proxy one of these commenters believed that determination as to what communications may be statements.54 These commenters independence determinations are deemed solicitations, either subject to or exempt suggested that it would be adequate to interpretive matters and that board from the proxy rules, is based on facts and members could be unaware of circumstances and is not intended to be affected by identify where the charter could be our adoption of this new disclosure obligation. found, provide the charter to security developments that would impact 57 48 Similar to the method used in Exchange Act holders upon request, and/or attach the independence. Another commenter Rule 14a–8 [17 CFR 240.14a–8] with regard to charter to the proxy statement once suggested that we revise the disclosure security holder proponents, the percentage of requirement to conform to the recently securities held by a recommending security holder, 49 adopted provision that requires as well as the holding period of those securities See new Paragraph (d)(2)(ii)(L) of Item 7 of may be determined by the company, on its own, if Exchange Act Schedule 14A. companies to state whether members of the security holder is the registered holder of the 50 See, e.g., American Federation of State, County, their audit committees are independent, securities. If not, the security holder can submit one and Municipal Employees (‘‘AFSCME’’); Council of as defined in applicable listing of the following to the company to evidence the Institutional Investors (‘‘CII’’); Creative Investment standards.58 We believe that it is required ownership and holding period: Research, Inc. (‘‘CIR’’); Andrew Randall; (1) a written statement from the ‘‘record’’ holder Pennsylvania State Employees’ Retirement System appropriate to use an approach of the securities (usually a broker or bank) verifying (‘‘SERS’’). consistent with the audit committee that, at the time the security holder made the 51 See, e.g., J.A. Glynn & Co. (‘‘J.A. Glynn’’); disclosure standards. Accordingly, the recommendation, he or she had held the required Robert Schneeweiss. disclosure standard we are adopting 52 securities for at least one year; or See, e.g., CII; CIR. will require companies to disclose (2) if the security holder has filed a Schedule 53 See, e.g., American Community Bankers 13D, Schedule 13G, Form 3 [17 CFR 249.103], Form (‘‘ACB’’); California Public Employees’ Retirement whether each member of the nominating 4 [17 CFR 249.104], and/or Form 5 [17 CFR System (‘‘CalPERS’’); CIR; United Brotherhood of committee is independent, as 249.105], or amendments to those documents or Carpenters and Joiners of America (‘‘UBC’’). independence for nominating updated forms, reflecting ownership of the 54 See, e.g., The Business Roundtable (‘‘BRT’’); committee members is defined in the securities as of or before the date of the Foley & Lardner (‘‘Foley’’); Independent recommendation, a copy of the schedule and/or Community Bankers Association (‘‘ICBA’’); 55 form, and any subsequent amendments reporting a International Paper Company (‘‘Int’l Paper’’); See, e.g., ICBA; Int’l Paper; McGuireWoods; change in ownership level, as well as a written Jenkens & Gilchrist (‘‘Jenkens’’); McGuireWoods NYSBAR. statement that the security holder continuously LLP (‘‘McGuireWoods’’); Committee on Securities 56 See, e.g., ABA; Sullivan. held the required securities for the one-year period Regulation of the Business Section of the New York 57 See ABA. as of the date of the recommendation. State Bar Association (‘‘NYSBAR’’); Sullivan & 58 See Sullivan. This disclosure requirement is set See Instruction 3 to new Paragraph (d)(2)(ii)(L) of Cromwell, LLP (‘‘Sullivan’’); Wells Fargo & forth in Paragraph (d)(3)(iv) of Item 7 of Exchange Item 7 of Item 7 of Exchange Act Schedule 14A. Company (‘‘Wells Fargo’’). Act Schedule 14A.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 66996 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

listing standards applicable to the listed candidates. Further, we do not view it category of person initially issuer. as appropriate to identify any specific recommended, or otherwise brought to criteria that a company must address in the attention of the nominating c. Qualifications and Skills of describing the qualities it looks for in committee, each candidate. In Candidates and Overall Board board candidates. disclosing the category of persons or Composition d. Sources of nominees entities that initially recommended a Commenters provided input with candidate to the nominating committee, regard to the proposed requirement that Some of the most extensive comment, companies should ensure that they companies describe the qualifications, particularly from the business and legal identify also any person or entity that qualities, skills, and overall composition communities, arose from the proposal to caused a particular candidate to be that companies are seeking with regard require companies to identify the source recommended. For example, if the chief to board membership. In this regard, of all director nominees, other than executive officer asks a third party to some commenters noted that incumbent directors and executive evaluate a potential candidate, and that nominating committees’ selection officers.62 Generally speaking, these third party ultimately recommends the processes do not tend to be precise, and commenters were of the view that, as candidate to the nominating committee, that the characteristics a nominating proposed, the required disclosure would both the chief executive officer and the committee looks for may change as the be difficult to make in a clear and third party should be identified as 59 composition of the board changes. In accurate manner because there are recommending parties in the company’s consideration of these comments, the multiple ‘‘sources’’ for most disclosure. We have provided for disclosure requirements we are adopting nominees.63 In addition, these disclosure of more than one type of today do not include the proposed commenters objected to naming the source for a nominee to address the requirement that companies describe specific source on the basis that this possibility of multiple sources. ‘‘any specific standards for the overall disclosure could have a ‘‘chilling effect structure and composition of the on the search process,’’64 would be e. Additional Disclosure Regarding company’s board of directors.’’60 We are immaterial,65 and could imply that a Nominees of Large, Long-Term Security adopting the remaining disclosure items nominee was unqualified to serve on the Holders substantially as proposed, as we believe board based solely on the position held The additional disclosure requirement that they will provide valuable by the individual (e.g., the chief with regard to nominees recommended information to security holders executive officer) who originally by large, long-term security holders regarding the nomination process, recommended the nominee.66 While elicited a great deal of comment from without resulting in boilerplate some commenters recommended that most categories of commenters. disclosures. we delete this provision, others Generally, commenters from the Many commenters that supported the recommended that we instead require business and legal communities disclosure requirements suggested that disclosure of the general category of recommended either deleting the we expand the requirements to require persons who recommended the nominee disclosure requirement related to companies to disclose the extent to (e.g., management or security holders).67 security holder recommendations which they take into consideration Another commenter recommended that altogether or increasing the beneficial diversity, in particular race and gender, we, instead, require companies to ownership requirement to 5% or 10% in nominating candidates.61 We have disclose whether nominees are and/or increasing the holding period to not included such a requirement in the independent from the company and, in two or more years.69 With regard to the standards we are adopting today, as we the case of nominees proposed by believe this particular consideration, as 5% and 10% recommendations, at least security holders, from the one commenter noted that those well as other considerations made by a recommending security holders.68 company, will likely be addressed recommending security holders would We continue to believe that be required to report their beneficial adequately by the new disclosure item information regarding the sources of requiring companies to disclose their ownership under Exchange Act company nominees is important for 70 criteria for considering board Regulation 13D. security holders; however, we have Some of the reasons given by revised the disclosure standard to 59 See, e.g., Foley; Jenkens; McGuireWoods; commenters for deleting the NYSBAR; Wells Fargo. require companies to identify the requirement were: 60 Release No. 34–48301 (August 8, 2003). category or categories of persons or • The requirement would give special 61 See, e.g., Boston Common Asset Management entities that recommended each status to larger security holders; 71 (‘‘Boston’’); Calvert Group Ltd. (‘‘Calvert’’); nominee. In this regard, we have • 3% security holders could use the Christian Brothers Investment Services (‘‘CBIS’’); retained the requirement that companies Nathan Cummings Foundation (‘‘Cummings’’); disclosure requirement for their own Domini Social Investments LLC (‘‘Domini’’); ISIS specifically note those instances where ‘‘special interests’’; 72 Asset Management (‘‘ISIS’’); J.A. Glynn; James a nominee was recommended by the • There could be more than one McRitchie, Editor, CorpGov.net and chief executive officer of the company. triggering nomination, thus resulting in PERSWatch.net, Letter dated September 13, 2003 In providing the required disclosure, (‘‘McRitchie2’’); Mehri & Skalet PLLC (‘‘Mehri complex and confusing disclosure; 73 &Skalet’’); Denise L. Nappier, Connecticut State companies should consider what • The requirement would create a Treasurer (‘‘Nappier’’); Social Investment Forum bias to accept marginal director 62 Ltd. (‘‘SIF’’); Socially Responsible Investment See, e.g., ABA; BRT; Intel Corporation (‘‘Intel’’); 74 Coalition (‘‘SRIC’’); William C. Thompson, Jr., Leggett & Platt Inc. (‘‘Leggett’’); NYSBAR; Valero candidates; Controller of the City of New York (‘‘Thompson’’); Energy Corporation (‘‘Valero’’); Wells Fargo. The General Board of Pension and Health Benefits 63 See id. 69 See, e.g., ACB; ACCA; Compass Bancshares, of the United Methodist Church (‘‘UMC’’); Walden 64 American Society of Corporate Secretaries. See Inc. (‘‘Compass’’); Foley; ICBA; Intel; Int’l Paper; Asset Management (‘‘Walden’’). See also Jesse also, American Corporate Counsel Association Jenkens; Leggett; NYSBAR; Sullivan; Wells Fargo. Smith Noyes Foundation (‘‘Noyes’’). We also (‘‘ACCA’’); Valero. 70 See Sullivan. received a number of letters that are substantially 65 71 similar in content that supported additional See, e.g., BRT. See id. disclosure describing board consideration of 66 See Sullivan. 72 Id. See also ABA. diversity. See Letter Type A (‘‘Letter A’’); Letter 67 See Boston; Intel; Walden. 73 See ABA. Type B (‘‘Letter B’’). 68 See ABA. 74 See Sullivan.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66997

• The requirements, specifically those determined that ownership of more than company to provide disclosure related regarding giving the reasons for rejecting 5% is a more appropriate threshold at to a recommendation would provide nominees, would ‘‘chill’’ nominating which to require companies to provide their written consent and proof of committee discussions; 75 additional disclosure.82 In this regard, ownership to the company at the time • The disclosure would not be we agree with commenters that a more of the recommendation. The company material to security holders; 76 and than 5% ownership threshold has a would not be obligated to request such • The disclosure would raise privacy significant advantage over a lesser materials where a security holder or issues for the nominating security ownership threshold, in that group does not otherwise provide their holder and candidate.77 recommending security holders would consent and proof of ownership.84 Conversely, this disclosure item also be subject to the beneficial ownership In consideration of the concerns received strong support from security reporting requirements of Exchange Act expressed by commenters, including holders, many of whom recommended Regulation 13D. We anticipate that a those with regard to boilerplate that we use a lower ownership more than 5% ownership threshold disclosure and privacy issues, the percentage trigger or a trigger no more will, in many cases, simplify the process disclosure standard that we are adopting stringent than that proposed.78 by which a company and the today does not include the proposed With regard to the requirement that recommending security holder requirement that companies disclose the the reasons for not nominating a determine that the recommending specific reasons for not nominating a candidate be given, many commenters security holder satisfies the ownership candidate. The requirement will, believed that this requirement would be threshold to trigger the additional however, require that companies difficult to satisfy, as: disclosure requirement and, where a identify the candidate in addition to the • Nominating committee security holder or group has reported its recommending security holder or group. determinations are not always precise in beneficial ownership prior to making a While not required, a company could, of nature; recommendation, will help to ensure course, choose to explain why it did not • The disclosure would expose that the company and its security nominate one or all of the security candidates to ridicule; and/or holders have basic information about holder-recommended candidates. • The disclosure would be an the recommending security holder. This We also have added language to the invasion of privacy for all parties will benefit the company by providing disclosure requirement to clarify the involved in the process, including the the nominating committee with date by which a security holder must nominating committee members, whose additional information regarding the submit a recommended nominee in deliberations would be made public as recommending security holder and, order to trigger the additional disclosure a result of the disclosure requirement.79 possibly, the recommended candidate. requirement by the company—a security Some commenters also expressed the Further, security holders will benefit holder’s recommendation would have to view that this requirement would through having additional information be received by a company’s nominating expose the company and nominating upon which they can evaluate the committee by a date not later than the committee members to risk of litigation nominating committee’s response to the 120th calendar day before the date the and would allow security holders to security holder recommendation.83 company’s proxy statement was ‘‘second guess’’ the nominating In addition, the new disclosure released to security holders in committee’s determinations.80 On the standard will require that companies connection with the previous year’s other hand, some commenters were of make the specified disclosures, annual meeting.85 We have added a new the view that we should retain the including identifying both the instruction clarifying that, where a proposed disclosure standard and nominating security holder or security company has changed its meeting date expand it to require companies to holder group and candidate, only in by more than 30 days, a security holder disclose the identity of rejected those instances where both parties have must make its recommendation by a candidates, provided that the candidates provided to the company their consent date that is a reasonable time before the consent to be so identified.81 to be identified and, where the security company begins to print and mail its After considering the comments, we holder or group members are not proxy statement in order to trigger the continue to believe that disclosure of registered holders, the security holder or additional disclosures.86 director recommendations made by group members have provided proof of In addition, we have added a new large, long-term security holders would the required ownership and holding instruction that responds to provide valuable information that period to the company. A security commenters’ suggestion that we address would enable security holders to better holder or group that seeks to require a how the percentage of securities owned understand the nomination process. We by a nominating security holder would have re-evaluated the 3% threshold to 82 On October 14, 2003, we proposed new rules be calculated.87 In this regard we have trigger the additional disclosure regarding the inclusion of security holder nominees for director in company proxy materials. See clarified that the percentage of securities requirement, however, and have Release No. 34–48626 (October 14, 2003). The issue held by a recommending security holder of the appropriate ownership threshold, if any, for may be determined by reference to the 75 See, e.g., id. any such inclusion of security holder nominees for 76 See id. director is a separate issue from the appropriate 84 ownership threshold for the disclosure we are See Instruction 4 to new Paragraph (d)(2)(ii)(L) 77 See id. adopting today and is not addressed in this release. of Item 7 of Exchange Act Schedule 14A. 78 See, e.g., American Federation of Labor and 85 83 In this regard, information available to our As is currently required in Exchange Act Rule Congress of Industrial Organizations (‘‘AFL–CIO’’); Office of Economic Analysis indicates that, of the 14a–8, this date would be calculated by CII; International Brotherhood of Teamsters (‘‘IBT’’); companies listed on the New York Stock Exchange, determining the release date disclosed in the ISIS; McRitchie2; Nappier; SERS; Trillium Asset Nasdaq Stock Market and American Stock Exchange previous year’s proxy statement, increasing the year Management (‘‘Trillium’’); UBC. See also AFSCME; as of December 31, 2002, 57% had at least one by one, and counting back 120 calendar days. Association of the Bar of the City of New York’s 86 institutional security holder that beneficially owned See Instruction 2 to new Paragraph (d)(2)(ii)(L) Special Committee on Mergers, Acquisitions and 5% of the common equity or similar securities and of Item 7 of Exchange Act Schedule 14A. The new Corporate Control Contests (‘‘NYCBAR’’). 1.4% had five or more such security holders. This instruction is modeled after the approach used with 79 See, e.g., ABA; BRT; Foley; Jenkens; NYSBAR; information was derived from filings on Exchange regard to Exchange Act Rule 14a–8 security holder Sullivan; Valero. Act Form 13-F [17 CFR 249.325] that indicated that proposals, as set forth in Exchange Act Rule 14a– 80 See, e.g., Compass; Foley; Jenkens. the filing security holder had held its securities for 8(e)(2) [17 CFR 240.14a–8(e)(2)]. 81 See CII; CIR; Cummings; SERS. at least one year. 87 See, e.g., ABA.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 66998 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

company’s most recently filed quarterly disclosure standards that we adopt and corporate governance policies.95 or annual report (or any subsequent today are a necessary complement to Some commenters believed the current report), unless the party relying those listing standards and, accordingly, disclosure would be useful to security on such report knows or has reason to do not believe such a delay is necessary holders, including one commenter who believe that the information included in or appropriate. expressed the view that the proposed the report is inaccurate.88 disclosure would provide security B. Disclosure Regarding the Ability of holders with important information that 4. Interaction of the Disclosure Security Holders To Communicate With provides an understanding of a Requirements With Recently Revised Boards of Directors company’s process for communications Market Listing Standards 1. Discussion with the board.96 Conversely, other The New York Stock Exchange and commenters did not believe that the the Nasdaq Stock Market have adopted We are adopting new disclosure proposed rules would be an effective revised listing standards that, among standards with regard to security holder means to improve board accountability, other requirements, require listed communications with board members. board responsiveness, and corporate companies to have independent These disclosure standards are intended governance policies and expressed the nominating committees.89 While these to improve the transparency of board view that the disclosure would not be listing standard changes demonstrate operations, as well as security holder useful to security holders.97 Overall, we the importance of the nomination understanding of the companies in continue to believe that the disclosure process and the nominating committee, which they invest.91 will provide security holders with and represent a strengthening of the role In response to our May 1, 2003 useful information about their ability to and independence of the nominating solicitation of input into the proxy communicate with board members. committee, they do not require process review by the Division of Accordingly, we are adopting, nominating committees to consider Corporation Finance, representatives of substantially as proposed, the disclosure security holder nominees or companies the business community commented standards related to security holder to make the disclosures described in that disclosure regarding the means by communications with board members. this release. The disclosure which security holders may 2. Disclosure Requirements requirements we are adopting today will communicate directly with the board of We are adopting a number of specific provide useful information to security directors would address issues of and detailed disclosure requirements holders regarding the nomination accountability and responsiveness regarding communications by security process, the manner of evaluating without extensive disruption or costs.92 holders with boards of directors because nominees, and the extent to which the Comments from investors and investor boards of directors of the companies in we believe that these requirements will advocacy groups also indicated the view provide security holders with a better which they invest have a process for that this disclosure would be helpful;93 considering, and do in fact consider, understanding of the manner in which however, these commenters also noted security holders can engage in these security holder recommendations. that disclosure alone would not address Accordingly, the disclosure communications. In particular, we all issues related to accountability and believe that the disclosure requirements, requirements we are adopting today will responsiveness.94 operate in conjunction with the revised including whether a board has a process We received similar comment with listing standards regarding nominating by which security holders can regard to the proposed disclosure communicate with it, are necessary to committees. requirements, with no clear consensus give security holders a better picture of A number of commenters from the as to whether the proposed rules would a critical component of the board’s business and legal communities be an effective means to improve board interaction with security holders. recommended that we delay adoption of accountability, board responsiveness, Detailed disclosure regarding that the proposed disclosure standards in process at a company, if it exists, will order to allow the new listing standards 91 be important to security holders in regarding nominating committees to In Exchange Act Release No. 34–48745 (November 4, 2003), the Commission approved a evaluating the nature and quality of the take effect.90 We agree with these new NYSE listing standard that addresses security communications process. Further, we commenters that the new listing holder communications with board members. This standard provides that: ‘‘In order that interested believe that the level of specificity in standards represent a significant the new disclosure standards will strengthening of the nomination parties may be able to make their concerns known to non-management directors, a company must discourage boilerplate disclosure. process; however, we believe that the disclose a method for such parties to communicate Companies will be required to directly and confidentially with the presiding provide the following disclosure with 88 See Instruction 1 to new Paragraph (d)(2)(ii)(L) director [of the non-management directors] or with of Item 7 of Exchange Act Schedule 14A. The new non-management directors as a group.’’ See NYSE regard to their processes for security instruction is modeled after Exchange Act Rule Section 303A(3). This method could be analogous holder communications with board 13d–1(j) [17 CFR 240.13d–1(j)], which specifies on to the method in the NYSE listing standards members: what basis beneficial holders may calculate the required by Exchange Act Rule 10A–3 regarding • A statement as to whether or not the percentage of subject securities they hold for audit committees. See Commentary to NYSE company’s board of directors provides a purposes of Exchange Act Regulation 13D. Section 303A(3). Exchange Act Rule 10A–3(b)(2) 89 See Release No. 34–48745 (November 4, 2003) requires listing standards relating to audit process for security holders to send [68 FR 64154]. While the NYSE standards include committees to require that ‘‘[e]ach audit committee communications to the board of a requirement that listed companies have an * * * establish procedures for the receipt, retention directors and, if the company does not independent nominating committee (NYSE section and treatment of complaints regarding accounting, have such a process for security holders internal accounting controls or auditing matters, 303A(4)(a)), the Nasdaq standards provide that the to send communications to the board of nomination of directors may, alternatively, be including procedures for the confidential, determined by a majority of the independent anonymous submission by employees of the issuer directors (NASD Rule 4350(c)). In discussing the of concerns regarding questionable accounting or 95 See Summary of Comments—File No. S7–14– NYSE and Nasdaq standards, our references to auditing matters.’’ 03. independent nominating committees encompass 92 See Summary of Comments—File No. S7–10– 96 See CIR. this alternative under the Nasdaq standards. 03. 97 See, e.g., ABA; BRT; Les Greenberg, Chairman, 90 See, e.g., ABA; ACB; ACCA; BRT; CSX 93 See id. Committee of Concerned Shareholders, Letter dated Corporation; Foley; ICBA; Jenkens; Valero. 94 See id. August 9, 2003 (‘‘CCS1’’); Valero.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 66999

directors, a statement of the basis for the In response to our request for describing in the proxy statement the view of the board of directors that it is comment as to whether the new manner in which security holders may appropriate for the company not to have disclosure standard should apply to communicate with board members, the such a process; 98 communications made in connection manner in which the company • If the company has a process for with security holder proposals determines those communications that security holders to send submitted pursuant to Exchange Act will be forwarded to board members, the communications to the board of Rule 14a–8, one commenter suggested company’s policy regarding director directors: that it would be ‘‘inappropriate’’ to attendance at annual meetings, and the • a description of the manner in exclude Exchange Act Rule 14a–8 number of directors who attended the which security holders can send proposals from the new disclosure prior year’s annual meeting, such communications to the board and, if standard; 105 however, other information may instead be placed on applicable, to specified individual commenters suggested that Exchange the company’s Web site, provided that directors; 99 and Act Rule 14a–8 communications should the company discloses in its proxy • If all security holder be expressly excluded.106 In particular, statement the Web site address where communications are not sent directly to one commenter noted that, ‘‘[b]oth the such information may be found.111 board members, a description of the security holder proponent and the Commenters also expressed concern company’s process for determining company are subject to specific, detailed about the proposed disclosure item which communications will be relayed requirements, conditions and deadlines, related to companies’ policies with to board members; 100 and including regulation of the content of regard to ‘‘filtering’’ communications.112 • A description of the company’s statements about the proposal * * * Some commenters suggested that policy, if any, with regard to board There is no need to impose another extensive disclosure of a company’s members’ attendance at annual meetings disclosure requirement on this process for determining which and a statement of the number of board process.’’ 107 We agree that the current communications are forwarded to board members who attended the prior year’s disclosure requirements with regard to members would imply that a company annual meeting.101 security holder proposals are adequate was improperly blocking to inform security holders of how they communications from security 3. Comments Regarding, and Revisions may communicate with boards via that holders.113 Such a filtering process is to, the Proposed Disclosure mechanism. Accordingly, we have necessary, in the opinion of these Requirements expressly excluded security holder commenters, because many security a. Scope of the Disclosure Requirement proposals submitted pursuant to holder communications are related to We received a number of comments Exchange Act Rule 14a–8, and company products and services, are suggesting that we clarify the communications made in connection solicitations, or otherwise relate to 114 application of the disclosure with such proposals, from the definition improper or irrelevant topics. At least requirements to communications with of ‘‘security holder communications’’ one commenter posited that the the board by officers, directors, for purposes of the new disclosure proposed disclosure item does not relate 108 employees, and agents of the company standard. directly to company processes to who also own company securities.102 facilitate communications with directors b. Process for Communicating With and should be deleted as We do not believe that all Board Members 115 communications from officers, directors, unnecessary. Another commenter We proposed a standard that would employees, and agents of the company suggested that we revise the disclosure have required companies to identify are the types of communications that requirement to clarify that purely those directors to whom security the disclosure standards should capture. ministerial activities, such as organizing holders could send communications. and collating security holder We have, therefore, added a general Commenters noted that they did not communications, need not be instruction to the new disclosure believe that it would be appropriate to disclosed.116 Other commenters noted requirements clarifying that: include such a requirement on the basis • Communications from an officer or that, should we retain the disclosure that named directors could then be director of the company will not be requirement, we should not expand it to targeted for inappropriate viewed as security holder include the identity of the party that is correspondence and that some responsible for filtering communications for purposes of the companies may not include specified communications.117 disclosure requirement; 103 and recipients of security holder In consideration of these comments, • Communications from an employee communications in their the disclosure item we are adopting or agent of the company will be viewed communications procedures.109 today does not include the requirement as security holder communications for In consideration of these concerns, we that companies identify the department purposes of the disclosure requirement have revised the disclosure requirement or other group within the company that only if those communications are made to specify that companies should is responsible for determining which solely in such employee’s or agent’s describe how security holders can send 104 communications are forwarded to capacity as a security holder. communications to the board and, if directors. We also have added an applicable, to specified individual 98 instruction to clarify that a company’s See new Paragraph (h)(1) of Item 7 of Exchange directors.110 We also have added a new Act Schedule 14A. process for collecting and organizing 99 See new Paragraph (h)(2)(i) of Item 7 of instruction providing that, in lieu of security holder communications, as well Exchange Act Schedule 14A. 100 See new Paragraph (h)(2)(ii) of Item 7 of 105 AFSCME. 111 See the Instruction to new Paragraphs (h)(2) Exchange Act Schedule 14A. 106 See NYSBAR; Valero. and (h)(3) of Item 7 of Exchange Act Schedule 14A. 101 See new Paragraph (h)(3) of Item 7 of 107 NYSBAR. 112 See, e.g., ABA; BRT; Intel; NYSBAR; Sullivan. Exchange Act Schedule 14A. 108 See Instruction 2 to new Paragraph (h) of Item 113 See Sullivan. See also ABA. 102 See, e.g., Wells Fargo. 7 of Exchange Act Schedule 14A. 114 See, e.g., Wells Fargo. 103 See Instruction 1 to new Paragraph (h) of Item 109 See NYSBAR. 115 See ABA. 7 of Exchange Act Schedule 14A. 110 See new Paragraph (h)(2)(i) of Item 7 of 116 See Sullivan. 104 See id. Exchange Act Schedule 14A. 117 See, e.g., NYSBAR; Wells Fargo.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67000 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

as similar or related activities, need not policies and general responsiveness to did not have in place such procedures, be disclosed, provided that the investors’ concerns. will constitute a material change.126 company’s process is approved by a Directors’ attendance at annual D. Investment Companies majority of the independent meetings can provide investors with an directors.118 opportunity to communicate with The new disclosure requirements directors about issues affecting the regarding board nominating committees c. Material Actions Taken by the Board company. We are adopting a and security holders’ communications of Directors as a Result of Security requirement that companies disclose with members of boards will apply to Holder Communications their policy with regard to director proxy statements of investment 127 Many commenters expressed concern attendance at annual meetings and the companies. Investment companies with regard to the proposal that would number of directors who attend the currently are required to comply with have required companies to describe annual meetings, as that disclosure will Exchange Act Schedule 14A when any material action taken by the board give security holders a more complete soliciting proxies, including proxies 128 of directors during the preceding fiscal picture of a company’s policies related relating to the election of directors. year as a result of security holder to opportunities for communicating Item 22(b)(14)(iv) of Exchange Act communications.119 Most of these with directors. Schedule 14A requires investment commenters suggested deleting this companies to disclose the same C. Related Disclosure in Quarterly and information about nominating disclosure requirement on the basis that Annual Reports it would be too difficult to tie board committees that currently is required for In response to our request for 129 actions to specific security holder operating companies by Item 7(d)(2). comment regarding whether material recommendations.120 One commenter As with operating companies, the changes to a company’s process for suggested that the disclosure enhanced transparency provided by the security holders to submit nominees for requirement was too vague and amendments is intended to provide election as director to the company companies would be unsure as to what security holders with additional, should be disclosed in periodic or specific information upon which to actions must be disclosed.121 In current reports, a number of evaluate the boards of directors and consideration of these concerns, the commenters indicated the need to nominating committees of the disclosure requirements we are adopting provide security holders with more investment companies in which they today do not include the proposed current information regarding that invest. Commenters generally supported requirement related to material actions process.123 These commenters the application of the proposed taken in response to security holder expressed the concern that the disclosure requirements to investment communications. procedures described in a company’s companies.130 d. Director Attendance at Annual proxy statement could change during The rules that we are adopting will Meetings the course of a fiscal year, and the require disclosure as to whether or not absence of information regarding those In the proposing release, we asked changes could impair significantly 126 See Instruction 2 to new Paragraph (g) of Item whether there were alternative ways to security holders’ opportunities to 401 of Exchange Act Regulation S–B and new Paragraph (j) of Item 401 of Exchange Act achieve our objectives. We further submit recommended nominees.124 In solicited comment on whether we Regulation S–K. response to these comments, we are 127 See Paragraphs (e) of Item 7 and (b) of Item should provide guidance to companies adopting new disclosure standards that 22 of Exchange Act Schedule 14A. The disclosure or otherwise address appropriate will require companies to report any requirements will apply to business development procedures for companies to implement material changes to the procedures for companies as well as investment companies with regard to security holder registered under the Investment Company Act of security holder nominations in the 1940 (‘‘Investment Company Act),’’ except where communications with board members. Exchange Act Form 10–Q, 10–QSB, 10– otherwise noted. Business development companies We also noted that the term K, or 10–KSB filed for the period in are a category of closed-end investment company that are not registered under the Investment ‘‘communications’’ was meant to be which the material change occurs.125 broadly construed. Several commenters Company Act, but are subject to certain provisions We also are including an instruction of that Act. See sections 2(a)(48) and 54–65 of the suggested that we require companies to clarifying that, for purposes of this Investment Company Act [15 U.S.C. 80a–2(a)(48) disclose whether they have a policy disclosure obligation, adoption of and 80a–53 – 64]. 128 regarding attendance by directors at procedures by which security holders See Investment Company Act Rule 20a–1 [17 annual meetings and provide CFR 270.20a–1] (requiring investment companies to may recommend nominees to a comply with Regulation 14A [17 CFR 240.14a–1— information about annual meeting company’s board of directors, where the 240.14a–101]), Schedule 14A, and all other rules 122 attendance by directors. We believe company previously disclosed that it and regulations adopted pursuant to section 14(a) that such a disclosure requirement of the Exchange Act [15 U.S.C. 78n] that would be applicable to a proxy solicitation if it were made in would further our broad objective to 123 See, e.g., AFL–CIO; AFSCME; Amalgamated; respect of a security registered pursuant to section provide investors with information CalPERS; CII; CIR; Cummings; IBT; Int’l Paper; 12 of the Exchange Act [15 U.S.C. 78l]). about a company’s communications McRitchie2; SERS; SIF; Smith; Trillium; UBC. 129 Investment companies are subject to Items 7 124 See id. and 22(b) of Exchange Act Schedule 14A when 125 See new Paragraph (b) of Item 5 of Part II to soliciting proxies regarding the election of directors. 118 See the Instruction to new Paragraph (h)(2)(ii) Exchange Act Forms 10–Q and 10–QSB, new Currently, in lieu of the disclosure required by of Item 7 of Exchange Act Schedule 14A. Paragraph (g) of Item 401 of Exchange Act Paragraphs (a)–(d)(2) of Item 7, investment 119 See, e.g., ABA; ACB; ACCA; Warren J. Archer Regulation S–B, and new Paragraph (j) of Exchange companies must provide the information required (‘‘Archer’’); BRT; DKW Law Group; Domini; Foley; Act Regulation S–K. In those instances where a by Paragraph (b) of Item 22. See Paragraph (e) of Intel; Int’l Paper; Jenkens; NYCBAR; NYSBAR. material change is implemented during the last Item 7. We are amending Paragraph (e) of Item 7 120 See, e.g., ABA; BRT; Domini; Foley; Intel; Int’l quarter of a company’s fiscal year, companies will to apply the disclosure requirements regarding Paper; Jenkens; NYCBAR; NYSBAR. be required to include disclosure of the change in nominating committees in Paragraph (d)(2) of Item 121 See NYSBAR. their Exchange Act Form 10–K or 10–KSB. See Item 7 to investment companies, and deleting the current 122 See Amalgamated Bank and its Long View 10 of Part III of Exchange Act Form 10–K, Item 9 disclosure requirement regarding nominating Funds (‘‘Amalgamated’’); Boston; CBIS; CII; Granary of Part III of Exchange Act Form 10–KSB, new committees in Paragraph (b)(14)(iv) of Item 22 as Foundation (‘‘Granary’’); Letter B; Maine Retirement Paragraph (g) of Item 401 of Exchange Act duplicative. System; McRitchie2; SERS; SIF; Walden. See also Regulation S–B, and new Paragraph (j) of Item 401 130 See, e.g., ABA; AFL–CIO; Investment Connie Hansen. of Exchange Act Regulation S–K. Company Institute (‘‘ICI’’).

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67001

the members of an investment company’s most recent report on Form (7) ‘‘Form 10–QSB’’ (OMB Control No. company’s nominating committee are N–CSR.136 3235–0416); ‘‘interested persons’’ of the company as Finally, as with operating companies, (8) ‘‘Regulation S–K’’ (OMB Control defined in section 2(a)(19) of the we are requiring a registered investment No. 3235–0071); Investment Company Act,131 rather than company to provide disclosure (9) ‘‘Regulation S–B’’ (OMB Control independent under the listing standards regarding material changes to the No. 3235–0417); and of a national securities exchange or procedures for security holder (10) ‘‘Form N–CSR’’ (OMB Control national securities association, as in the nominations of directors. This No. 3235–0570).142 case of operating companies.132 We are information will be provided in Form These regulations, forms and requiring disclosure with respect to the N–CSR.137 schedules were adopted pursuant to the Securities Act, Exchange Act and section 2(a)(19) test for investment III. Paperwork Reduction Act companies because that test is tailored Investment Company Act and set forth to capture the broad range of affiliations A. Background the disclosure requirements for annual and quarterly reports and proxy and with investment advisers, principal The amendments to Exchange Act information statements filed by underwriters, and others that are Schedule 14A contain ‘‘collection of companies to ensure that investors are relevant to ‘‘independence’’ in the case information’’ requirements within the informed.143 The hours and costs of investment companies. Commenters meaning of the Paperwork Reduction associated with preparing, filing, and generally supported the use of this test Act of 1995.138 We published a notice sending these forms and schedules for independence in the case of requesting comment on the collection of 133 constitute reporting and cost burdens investment companies. Similarly, information requirements in the imposed by each collection of with respect to the instruction that proposing release, and we submitted information. An agency may not states that in describing a company’s these requirements to the Office of conduct or sponsor, and a person is not process for determining which Management and Budget for review in required to respond to, a collection of communications will be relayed to accordance with the PRA.139 The titles board members, collecting and information unless it displays a for the collections of information are: currently valid control number. organizing security holder (1) ‘‘Proxy Statements—Regulation communications need not be disclosed 14A (Commission Rules 14a–1 through B. Summary of Amendments provided that the company’s process is 14a–15 and Schedule 14A)’’ (OMB Under the amendments, we are approved by a majority of the Control No. 3235–0059); expanding the disclosure that currently independent directors, we are (2) ‘‘Information Statements— is required in company proxy or specifying in the case of investment Regulation 14C (Commission Rules 14c– information statements regarding the companies that the approval required is 140 1 through 14c–7 and Schedule 14C)’’ activities of a company’s nominating of a majority of the directors who are (OMB Control No. 3235–0057); committee. The new disclosure not ‘‘interested persons’’ under section (3) ‘‘Rule 20a–1 under the Investment requirements also will require 2(a)(19).134 Company Act of 1940, Solicitations of As with operating companies, disclosure in proxy or information Proxies, Consents and Authorizations’’ statements regarding the policies and investment companies will be required 141 (OMB Control No. 3235–0158); procedures regarding security holder to state which one or more of certain (4) ‘‘Form 10–K’’ (OMB Control No. communications with boards of categories of persons or entities 3235–0063); directors. We are adopting new recommended each nominee who is (5) ‘‘Form 10–KSB’’ (OMB Control No. requirements for disclosure of company approved by the nominating committee 3235–0420); for inclusion on the company’s proxy (6) ‘‘Form 10–Q’’ (OMB Control No. policies with regard to board members’ card.135 However, in recognition of the 3235–0070); attendance at annual meetings and the fact that investment companies are number of board members who attended generally externally managed by an 136 See Instruction 1 to new Paragraph (d)(2)(ii)(L) the prior year’s annual meeting, as well investment adviser, the categories will of Item 7 of Exchange Act Schedule 14A. In the case as disclosure in periodic reports of any include the following: security holder, of business development companies, which are not material changes to company required to file reports on Form N–CSR, the procedures for security holder director, chief executive officer, other percentage of securities would be determined by executive officer, or employee of the reference to the company’s reports on Exchange Act nominations. Compliance with the investment company’s investment Forms 10–K and 10–Q. disclosure requirements will be adviser, principal underwriter, or any 137 See new Item 9 of Form N–CSR. We are mandatory. There will be no mandatory renumbering current Items 9 and 10 as Items 10 and affiliated person of the investment 11, and are adopting a conforming change to Rule adviser or principal underwriter. With 142 The changes to the collections of information 30a–2 under the Investment Company Act to reflect entitled ‘‘Regulation S–B’’ and ‘‘Regulation S–K’’ respect to the disclosure requirement the renumbering of Item 10. Because business are reflected in our estimates for Forms 10–Q, 10– regarding nominees recommended by development companies file reports on Forms 10– QSB, 10–K and 10–KSB. Therefore, we are not large, long-term security holders, we are K and 10–Q rather than Form N–CSR, they would changing the burden estimates for those titles. provide the required disclosure on these forms. 143 The proxy rules apply to domestic companies adopting an instruction clarifying that, 138 44 U.S.C. 3501 et seq. with equity securities registered under section 12 of for a registered investment company, 139 44 U.S.C. 3507(d) and 5 CFR 1320.11. the Exchange Act and to investment companies the percentage of securities held by a 140 Exchange Act Schedule 14C requires registered under the Investment Company Act. recommending security holder may be disclosure of some items of Exchange Act Schedule There is a discrepancy between the number of determined by reference to the 14A. Therefore, while we are not amending the text annual reports by reporting companies and the of Exchange Act Schedule 14C, the amendments to number of proxy and information statements filed Exchange Act Schedule 14A must also be reflected with the Commission in any given year. This is 131 15 U.S.C 80a–2(a)(19). in the PRA burdens for Exchange Act Schedule 14C. because some companies are subject to reporting 132 New Paragraph (b)(14)(ii) of Item 22 of 141 Investment Company Act Rule 20a–1 requires requirements by virtue of section 15(d) of the Exchange Act Schedule 14A. registered investment companies to comply with Exchange Act [15 U.S.C. 78o], and therefore are not 133 See, e.g., ABA; ICI. Exchange Act Regulation 14A or 14C, as applicable. covered by the proxy rules. In addition, companies 134 See the Instruction to new Paragraph (h)(2)(ii) Therefore, the annual responses to Investment that are not listed on a national securities exchange of Item 7 of Exchange Act Schedule 14A. Company Act Rule 20a–1 reflect the number of or the Nasdaq Stock Market may not hold annual 135 See new Paragraph (d)(2)(ii)(J) of Item 7 of proxy and information statements that are filed by meetings and therefore would not be required to file Exchange Act Schedule 14A. registered investment companies. a proxy or information statement.

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67002 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

retention period for the information burden could be as high as 12 hours for executive officers, the disclosure disclosed, and responses to the the first year and 4 hours for following committee, in-house counsel, outside disclosure requirements will not be kept years.147 counsel, and members of the board of confidential. The actual paperwork burden for directors.149 Because the current rules already require a company to collect C. Responses to Request for Comments some companies could be 5 hours per schedule; however, in devising the and disclose information about the We requested comment on the PRA estimates we considered a number of composition, functions, policies and analysis contained in the proposing factors. For example, large companies procedures of its nominating committee, release. While we received only two may incur a greater paperwork burden we factored the pre-existing burdens comment letters specifically addressing than small companies, the pre-existing into our estimates for the new our PRA analysis, we received several disclosure requirements may enable disclosure requirements. comment letters responding to the companies to streamline the collection We derived the paperwork burden proposals in general.144 Although we of information necessary for the new estimates by estimating the total amount are adopting the disclosure amendments disclosure, and the amendments contain of time it will take a company to prepare substantially as proposed, we have more simplified disclosure requirements and review the disclosure. We estimated made some additions and subtractions from the proposals, which will lower that, over a three-year time period, the to the disclosure requirements in the the paperwork burden. After annual incremental disclosure burden final rules that will have the net effect considering these factors, we do not will be an average of 3 hours per of reducing the amount of required believe that 5 hours per schedule is an schedule. This estimate was based on disclosures. In response to comments, accurate burden estimate. However, two assumptions: we are adding a requirement for after considering the comments • Companies spend a greater amount companies to provide updates in indicating that we may have of time preparing the disclosure in year periodic reports regarding material underestimated slightly the burden, we one and will become more efficient in changes to the procedures for security are not reducing our burden estimates preparing the disclosure over the holder nominations. We also are adding for proxy and information statements, following two years; 150 and a requirement for companies to describe even though the amendments will • in proxy and information statements reduce the amount of disclosure from Not all proxy and information their policies regarding director that which would have been required by statements involve action to be taken attendance at annual meetings and the the proposals. with respect to the election of directors, number of directors who attended the and therefore will not require prior year’s annual meeting. After D. Paperwork Burden Estimates companies to provide the disclosure.151 considering the comments, we are not As a result of the changes described This estimate represents the average adopting certain of the proposed above, the reporting and cost burden burden for all companies, both large and disclosure requirements. For example, estimates for the collections of small, that are subject to the proxy rules. the amendments will not require information have changed. While we are We expect that the disclosure burden companies to describe: • not changing the paperwork burden could be greater for larger companies The material terms of their estimates for proxy and information and lower for smaller companies. Table nominating committee charters; • statements, we are adding collection of 1, below, illustrates the incremental Any specific standards for the information requirements in periodic annual compliance burden of the overall structure and composition of the reports under the Exchange Act. collection of information in hours and board of directors; in cost for proxy and information • The specific reasons for the 1. Proxy and Information Statements statements under the Exchange Act and nominating committee’s determination For purposes of the PRA, we Investment Company Act. not to include a security holder estimated the annual incremental candidate as a nominee; and paperwork burden for proxy and 149 • Any material action taken by the In connection with other recent rulemakings, information statements under the new we have had discussions with several private law board of directors as a result of disclosure requirements to be firms to estimate an hourly rate of $300 as the cost communications from security holders. approximately 19,557 hours of company of outside professionals that assist companies in The majority of commenters did not preparing these disclosures. personnel time and a cost of comment on the hours and cost burdens 150 We estimated that it will take 6 hours to approximately $1,955,700 for the for companies that will result from the prepare the disclosure in year one, 3.13 hours in services of outside professionals.148 year two, and 2.03 hours in year three. amendments; however, we received two That estimate included the time and the 151 We estimate that 20% of all proxy and comment letters that specifically cost of preparing disclosure that has information statements do not include disclosure addressed the paperwork burdens in the about directors, and therefore would not include been appropriately reviewed by proposing release.145 One commenter the disclosure required by the amendments. This noted that given the number of unlisted estimate is based on the proportion of preliminary 147 See Stoecklein. Using those numbers as inputs proxy statements to definitive proxy statements companies, it is difficult to estimate the into our model, the annual incremental disclosure filed in our 2002 fiscal year (2,555/8,692=29%), 146 compliance burden. One commenter burden over a three-year time period would be an which has been adjusted downward by 9% to believed that the proposing release average of 5 hours per schedule. Accordingly, using reflect the fact that some preliminary proxy underestimated the disclosure burden the commenter’s assumptions, the annual statements contain disclosure about directors. This for the proposed rules, and that the incremental paperwork burden for all companies to estimate is based on the rationale that preliminary prepare the disclosure would be approximately proxy statements are less likely to contain 32,595 hours of company personnel time and a cost disclosure about directors because registrants do 144 See discussion of comments in Part II of this of approximately $3,259,500 for the services of not file preliminary proxy statements for security release and Summary of Comments—S7–14–03. outside professionals. holder meetings where the matters to be acted upon 145 See ABA; Stoecklein Law Group 148 For convenience, the estimated PRA hour involve only the election of directors or other (‘‘Stoecklein’’). burdens have been rounded to the nearest whole specified matters. See Exchange Act Rule 14a–6 [17 146 See ABA. number. CFR 240.14a–6].

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00012 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67003

TABLE 1: CALCULATION OF INCREMENTAL PRA BURDEN ESTIMATES

Annual re- Incremental Incremental bur- 75% company 25% professional $300 prof. cost sponses hours/form den × × × (A) (B) (C)=(A) × (B) (D)=(C) 0.75 (E)=(C) 0.25 (F)=(E) $300

SCH 14A ...... 7,188 3.00 21,564.00 16,173 5,391.00 $1,617,300.00 SCH 14C ...... 446 3.00 1,338.00 1,004 334.50 100,350.00 Rule 20a–1 ...... 1,058 3.00 3,174.00 2,381 793.50 238,050.00 Total ...... 8,692 ...... 19,557 ...... 1,955,700.00

2. Periodic Reports period, the annual incremental may recommend nominees to the board disclosure burden would be an average of directors; 153 and For purposes of the PRA, we estimate of 0.01 hours per Form 10–K and Form • It will take .25 hours to prepare the the annual incremental paperwork 10–KSB, 0.04 hours per Form 10–Q and disclosure regarding material changes to burden for Exchange Act periodic Form 10–QSB, and 0.03 hours per Form security holder nomination procedures. reports under the new disclosure N–CSR.152 This estimate was based on Table 2, below, illustrates the requirements to be approximately 1,311 the following two assumptions: incremental annual compliance burden hours of company personnel time and a • of the collection of information in hours cost of approximately $131,100 for the Each year, 20% of reporting and in cost for periodic reports under services of outside professionals. We companies will change materially the the Exchange Act and Investment estimate that, over a three-year time procedures by which security holders Company Act.

TABLE 2: CALCULATION OF INCREMENTAL PRA BURDEN ESTIMATES

Annual re- Incremental Incremental bur- 75% company 25% professional $300 prof. cost sponses hours/form den × × × (A) (B) (C)=(A) × (B) (D)=(C) 0.75 (E)=(C) 0.25 (F)=(E) $300

10–K ...... 8,484 0.01 84.84 64 21.21 $6,000.00 10–KSB ...... 3,820 0.01 38.20 29 9.55 3,000.00 10–Q ...... 23,743 0.04 949.72 712 237.43 71,000.00 10–QSB ...... 11,299 0.04 451.96 339 112.99 34,000.00 N–CSR ...... 7,400 0.03 222.00 167 55.50 17,000.00 Total ...... 1,311 ...... $131,000.00

E. Request for Comment burden. Persons who desire to submit OMB is required to make a decision We request comment in order to (a) comments on the collection of concerning the collections of evaluate whether the collections of information requirements should direct information between 30 and 60 days information are necessary for the proper their comments to the OMB, Attention: after publication, your comments are performance of our functions, including Desk Officer for the Securities and best assured of having their full effect if whether the information will have Exchange Commission, Office of the OMB receives them within 30 days practical utility, (b) evaluate the Information and Regulatory Affairs, of publication. Washington, DC 20503, and send a copy accuracy of our estimate of the burden IV. Cost-Benefit Analysis of the collections of information, (c) of the comments to Jonathan G. Katz, determine whether there are ways to Secretary, Securities and Exchange A. Background enhance the quality, utility, and clarity Commission, 450 Fifth Street, NW., of the information to be collected, and Washington, DC 20549, with reference On August 8, 2003 we proposed new (d) evaluate whether there are ways to to File No. S7–14–03. Requests for disclosure requirements intended to minimize the burden of the collections materials submitted to the OMB by us increase the transparency of nominating of information on those who respond, with regard to this collection of committee functions and the processes including through the use of automated information should be in writing, refer by which security holders may collection techniques or other forms of to File No. S7–14–03, and be submitted communicate with boards of directors of information technology.154 to the Securities and Exchange the companies in which they invest.155 Any member of the public may direct Commission, Office of Filings and These proposals followed substantially to us any comments concerning the Information Services, Branch of Records the recommendations made by the accuracy of this burden estimate and Management, 450 Fifth Street, NW., Division of Corporation Finance in a any suggestions for reducing this Washington, DC 20549. Because the staff report dated July 15, 2003.156 In

152 For example, the average burden per form for .03. The discrepancy in quotients is due to the fact 154 Comments are requested pursuant to 44 U.S.C. Form 10–K is calculated as follows: [(8,484 Form that operating companies report on a quarterly 3506(c)(2)(B). × × 10–Ks 5% frequency of disclosure 0.25 hours)/ basis, while registered management investment 155 See Release No. 34–48301 (August 8, 2003). 8,484 Form 10–Ks] = .01. The calculation for Form companies report on a semi-annual basis. 156 See Staff Report: Review of the Proxy Process 10–Q is as follows: [(23,743 Form 10–Qs × 15% 153 Under our assumptions, 5% of operating frequency of disclosure × 0.25 hours)/23,743 Form companies will provide the disclosure each quarter Regarding the Nomination and Election of 10–Qs] = .04. The calculation for Form N–CSR is (for a total of 20%), while 10% of registered Directors, Division of Corporation Finance (July 15, as follows: [(7,400 Form N–CSRs × 10% frequency management investment companies will provide 2003). The Division’s Staff Report, detailing the of disclosure × 0.25 hours)/7,400 Form N–CSRs] = the information semi-annually (for a total of 20%). results of its review of the proxy process related to Continued

VerDate jul<14>2003 20:37 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00013 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67004 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

committee functions and the processes These proposals followed substantially Division of Corporation Finance in a by which security holders may the recommendations made by the staff report dated July 15, 2003.156 In communicate with boards of directors of the companies in which they invest.155 considered the input of members of the 156 See Staff Report: Review of the Proxy Process Regarding the Nomination and Election of investing, business, legal, and academic Directors, Division of Corporation Finance (July 15, preparing this report and developing its communities.157 2003). The Division’s Staff Report, detailing the recommendations, the Division The Commission is adopting the results of its review of the proxy process related to

VerDate jul<14>2003 20:34 Nov 26, 2003 Jkt 200001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67005

On balance, we believe these estimates D. Small Business Issuers expenses.187 This commenter noted are reasonable. that, as regulatory requirements Although the new rules apply to small To the extent that the new disclosures increase, small businesses will have to business issuers, we do not anticipate hire additional staff or reduce the influence corporate behavior, however, any disproportionate impact on small the costs would extend beyond a number of hours spent managing the business issuers. Like other issuers, company.188 disclosure burden. For example, small business issuers should incur After reviewing these comments, we companies may incur additional costs in relatively minor compliance costs to are convinced that issues relating to instituting more responsive policies and fulfill their disclosure obligations, and corporate accountability and security procedures regarding director should find it unnecessary to hire extra holder rights affect small companies as nominations and security holder personnel. Several commenters much as they affect large companies. communications. We have not included supported requiring small companies to The concerns raised by the commenters these costs in our analysis of the provide the disclosure.179 addressed primarily the cost of additional disclosure requirement, but Other commenters recommended establishing and maintaining new board have sought comment regarding such granting outright relief to small policies and procedures—not the cost of costs and related matters. After businesses or deferring application of the disclosure required by the considering the comments, which are the rules to small businesses until the amendments. A small business issuer is summarized below, we continue to Commission evaluates the impact of the not required to adopt new policies and believe that the amendments provide rules.180 One commenter suggested that procedures under the amendments. useful information to investors. The small companies that have established Thus, we do not believe that applying amendments do not require a company procedures could comply voluntarily.181 the rules to small business issuers to adopt any particular policies and These commenters sought relief for would be inconsistent with the policies procedures. To the extent that a small businesses for several reasons. underlying the small business issuer company voluntarily incurs the expense One commenter recommended that we disclosure system. of adopting more responsive board not apply the rules to small businesses V. Consideration of Burden on policies, we believe that those costs are because it will ‘‘waste the money of Competition and Promotion of justified by the benefits of such policies. small publicly held companies, create Efficiency, Competition, and Capital confusion * * * and provide no useful Formation In response to our request for service to security holders. ’’182 This comment, one commenter noted that the commenter noted that there does not Section 23(a)(2) of the Exchange initial cost of implementing and appear to be a significant number of Act 189 requires us, when adopting rules maintaining procedures would be instances where major security holders under the Exchange Act, to consider the 173 high. This commenter identified the of small publicly held companies were impact that any new rule would have on indirect cost of the increase in the unable to communicate with boards of competition. In addition, section amount of time that must be spent directors, particularly because major 23(a)(2) prohibits us from adopting any monitoring corporate activities, which security holders are in management rule that would impose a burden on may detract from effective management and/or on the board.183 Further, this competition not necessary or of the company.174 The commenter commenter was of the view that, appropriate in furtherance of the identified costs such as legal fees because major unaffiliated security purposes of the Exchange Act. The associated with structuring and holders potentially can impact the amendments are intended to make reviewing policies, the cost of trading price of small business information about the functions of a management time related to structuring securities, management and the board company’s nominating committee of the policies, fees paid to accountants for ‘‘take the views of major unaffiliated board of directors, as well as the ability managerial and financial statement security holders very seriously. ’’184 of security holders to communicate with creation and review, opportunity costs This commenter also noted that the the board of directors, more transparent related to missed business board and security holders will not to investors. We anticipate that the new opportunities, and other costs.175 agree on every aspect of running the rules will provide increased information upon which to evaluate the functioning One commenter believed that the company and it is not clear why small businesses need to set up a procedure of boards of directors and make rules could be ‘‘extremely costly, time- for every communication with security investment decisions. The rules may consuming and potentially holders.185 affect competition because they will disruptive. ’’176 This commenter allow companies to consider their One commenter noted that increasing explained that the rules could increase existing policies in relation to policies the incremental cost to small businesses significantly the number of adopted by other companies. As a by a certain number of hours and communications that are sent to board result, companies may compete to adopt assuming that the staff is available members and the more corporate policies that effectively balance security already is flawed.186 One commenter directors must divide their time, the less holder and director interests and, believed that the benefits of increased effectively they will discharge their therefore, attract investors. disclosure would not outweigh a small competing functions.177 Two We have identified one possible area business issuer’s need to reduce commenters believed that the disclosure where the rules could potentially place requirements would increase the burden a burden on competition. The new 179 See CalPERS; CII; Granary; Letter B; 178 disclosure will enable investors to on boards and discourage service. McRitchie2; SERS; SIF; Trillium. 180 See ABA; Archer; Foley; Stoecklein. compare companies’ policies and 173 See CIR. 181 See ABA. procedures for director nominations and 174 See id. 182 See Archer. communications with directors. To the 175 See id. 183 See id. 176 See Foley. 184 See id. 187 See Stoecklein. 177 See id. 185 See id. 188 See id. 178 See CIR; Foley. 186 See id. 189 15 U.S.C. 78w(a)(2).

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67006 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

extent that investors may place a communications with boards of responsiveness to security holder issues premium on a company that provides directors. An Initial Regulatory and inquiries by illuminating the degree security holders with favorable director Flexibility Analysis was prepared in of director involvement with security nomination and communication accordance with the Regulatory holder concerns. procedures, a company will be at a Flexibility Act 194 in conjunction with B. Significant Issues Raised by Public disadvantage to other companies that the proposing release. The proposing Comment maintain more favorable procedures. release included the IRFA and solicited Section 2(b) of the Securities Act,190 comments on it. The Initial Regulatory Flexibility section 3(f) of the Exchange Act 191 and Analysis appeared in the proposing section 2(c) of the Investment Company A. Need for the Amendments release. We requested comment on any Act 192 require us, when engaging in The amendments are designed to aspect of the IRFA, including the rulemaking that requires us to consider address the growing concern among number of small entities that would be or determine whether an action is security holders over the accountability affected by the proposals, the nature of necessary or appropriate in the public of corporate directors and the lack of the impact, how to quantify the number interest, to consider, in addition to the sufficient security holder input into of small entities that would be affected, protection of investors, whether the decisions made by the boards of and how to quantify the impact of the action will promote efficiency, directors of the companies in which proposals. While we did not receive any competition, and capital formation. We they invest. Currently, companies must comments that responded directly to the believe the disclosure will make state whether they have a nominating IRFA, we did receive comments information about the operation of a committee and, if so, must identify the addressing the impact on small business company’s director nomination process members of the nominating committee, issuers. Several commenters supported more transparent. In addition, state the number of committee meetings requiring small companies to provide disclosure regarding the means by held, and briefly describe the functions the disclosure.197 In that regard, which security holders may performed by such committees.195 In commenters stated, ‘‘enhanced communicate directly with a company’s addition, if a company has a nominating disclosure would be of great value to all board of directors may increase security or similar committee, it must state types of investors.’’198 Other holder involvement in the companies in whether the committee considers commenters recommended granting which they invest. As a result, we nominees recommended by security outright relief to small businesses or believe that investors may be able to holders and, if so, must describe how deferring application of the rules to evaluate a company’s board of directors security holders may submit small businesses until the Commission 196 199 more effectively and make more recommended nominees. The evaluates the impact of the rules. One informed investment decisions. We amendments are designed to build upon commenter suggested that small believe that, as a consequence of these existing disclosure requirements to companies that have established 200 developments, there may be some elicit a more detailed discussion of the procedures could comply voluntarily. positive impact on the efficiency of policies and procedures of nominating Those commenters who sought relief markets and capital formation. The committees as well as the means by for small businesses did so for several possibility of these effects, their which security holders can reasons. One commenter recommended magnitude if they were to occur, and the communicate with boards of directors. that we not apply the rules to small extent to which they will be offset by The amended disclosure requirements businesses because it will ‘‘waste the are designed to enhance transparency of money of small publicly held the costs of the new rules, are difficult the policies of boards of directors, with companies, create confusion * * * and to quantify. the goal of providing security holders a provide no useful service to security We requested comment on these 201 matters in the proposing release. We better understanding of the functions holders.’’ This commenter noted that received no comments in response to and activities of the boards of the there does not appear to be a significant these requests. companies in which they invest. For number of instances where major example, the amendments relating to security holders of small publicly held VI. Final Regulatory Flexibility nominating committees will require companies were unable to communicate Analysis disclosure about the source of director with boards of directors, particularly This Final Regulatory Flexibility candidates and the level of scrutiny because major security holders are in Analysis has been prepared in accorded to each candidate. The management and/or on the board.202 accordance with the Regulatory amendments relating to security holder Further, this commenter was of the view Flexibility Act.193 This FRFA involves communications with directors may that, because major unaffiliated security amendments to Items 7 and 22 of strengthen the association among holders potentially can impact the Exchange Act Schedule 14A, Item 5 of security holders and directors by trading price of small business Exchange Act Forms 10–Q and 10–QSB, providing security holders with a better securities, management and the board Form N–CSR, and Item 401 of understanding of the means by which ‘‘take the views of major unaffiliated 203 Regulations S–B and S–K. The they may communicate with board security holders very seriously.’’ This amendments will expand the disclosure members. For example, the amended commenter also noted that the board that currently is required in company disclosure will inform security holders and security holders will not agree on filings regarding the functions of a of the manner in which to send every aspect of running the company company’s nominating committee. In communications to the board. Moreover, and it is not clear why small businesses addition, the amendments will require the amendments aim to enable investors to better evaluate a company’s 197 See CalPERS; CII; Granary; Letter B; disclosure regarding the policies and McRitchie2; SERS; SIF; Trillium. procedures regarding security holder 198 194 5 U.S.C. 603. See Letter B; McRitchie2. 199 195 See Paragraph (d)(1) of Item 7 of Exchange Act See ABA; Archer; Foley; Stoecklein. 190 15 U.S.C. 77b(b). Schedule 14A. 200 See ABA. 191 15 U.S.C. 78c(f). 196 See Paragraph (d)(2) of Item 7 of Exchange Act 201 See Archer. 192 15 U.S.C. 80a–2(c). Schedule 14A, prior to adoption of these 202 See id. 193 5 U.S.C. 601. amendments. 203 See id.

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67007

need to set up a procedure for every year.209 As discussed below, we believe the new rules.215 We also estimate that communication with security that the amendments will affect approximately 25 of the proxy and holders.204 approximately 805, or 32%, of the small information statements for investment One commenter noted that increasing entities that are operating companies. companies that are not ‘‘listed issuers’’ the incremental cost to small businesses We believe that the amendments also will be filed by small entities affected by by a certain number of hours and will affect approximately 50 of the small the new disclosure requirements. assuming that the staff is available entities that are investment companies. Therefore, we estimate that the 205 amendments will, in total, affect already is flawed. One commenter The Commission received 8,692 approximately 855 small entities.216 believed that the benefits of increased separate proxy and information disclosure would not outweigh a small We requested comment on the statements in its 2002 fiscal year. We number of small entities that would be business issuer’s need to reduce estimate that 6,954, or 80%, of those 206 impacted by our proposals, including expenses. This commenter noted filings involved the election of directors, that, as regulatory requirements any available empirical data. We and therefore will be affected by the received no responses to this request. increase, small businesses will have to new disclosure requirements.210 hire additional staff or reduce the Furthermore, we estimate that 5,257 D. Reporting, Recordkeeping, and Other number of hours spent managing the Compliance Requirements 207 companies are ‘‘listed issuers’’ (as company. defined in Exchange Act Rule 10A–3) The amendments are expected to After reviewing these comments, we that are subject to the proxy rules.211 result in some additional costs to are convinced that issues relating to Because the relevant listing standards of comply with the disclosure corporate accountability and security national securities exchanges and requirements. Because the current rules holder rights affect small companies as Nasdaq require that listed issuers hold already require a company to collect much as they affect large companies. annual meetings, and state law provides and disclose information about the The concerns raised by the commenters for the election of directors at annual composition, functions, policies and addressed primarily the cost of meetings, we estimate that at least 5,257 procedures of its nominating committee, establishing and maintaining new board proxy and information statements the disclosure should not impose policies and procedures ‘‘not the cost involve elections of directors.212 Of significant new costs for the collection of the disclosure required by the these proxy and information statements, of information. Thus, the task of amendments. A small business issuer is less than 225 relate to operating complying with the nominating not required to adopt new policies and companies and less than 25 relate to committee disclosure could be procedures under the amendments. investment companies that constitute performed by the same person or group Thus, we do not believe that applying of persons responsible for compliance ‘‘small entities.’’ 213 Therefore, we the rules to small business issuers under the current rules at a minimal deduced that 1,697 proxy and would be inconsistent with the policies incremental cost. Moreover, if a small information statements relate to the underlying the small business issuer entity were to maintain a process for election of directors for companies that disclosure system. Like other issuers, security holders to send are not ‘‘listed issuers.’’214 We estimate small business issuers should incur communications to its board of that approximately 580 of the proxy and relatively minor compliance costs to directors, company personnel would be fulfill their disclosure obligations, and information statements for operating aware of such procedures and the should find it unnecessary to hire extra companies that are not ‘‘listed issuers’’ disclosure burden also would be personnel. To the extent small will be filed by small entities affected by minimal. If a small entity does not businesses decide to adopt such maintain such a process, then the policies, they are likely to do so because 209 Id. disclosure will consist of a statement 210 We estimate that 20% of all proxy and they believe the benefits justify the information statements do not include disclosure that the board does not have a costs. about directors, and therefore would not include communications process and a the disclosure required by the amendments. This statement of the specific basis for the C. Small Entities Subject to the estimate is based on the proportion of preliminary view of the board of directors that it is Amendments proxy statements to definitive proxy statements filed in our 2002 fiscal year (2,555/8,692=29%), appropriate for the company not to have The amendments will affect which has been adjusted downward by 9% to such a communications process. companies that are small entities. reflect the fact that some preliminary proxy To the extent that the new rules Exchange Act Rule 0–10(a) 208 defines a statements contain disclosure about directors. This influence corporate behavior, however, estimate is based on the rationale that preliminary the costs will extend beyond a company, other than an investment proxy statements are less likely to contain company, to be a ‘‘small business’’ or disclosure about directors because registrants do disclosure burden. For example, ‘‘small organization’’ for purposes of the not file preliminary proxy statements for security companies may incur additional costs in Regulatory Flexibility Act if it had total holder meetings where the matters to be acted upon instituting more responsive policies and involve only the election of directors or other procedures regarding director assets of $5 million or less on the last specified matters. See Exchange Act Rule 14a-6. day of its most recent fiscal year. An 211 We derived this estimate from the database nominations and security holder investment company is considered to be provided by the Center for Research in Securities communications. The new disclosure a ‘‘small business’’ if it, together with Prices at the University of Chicago, the Standard & other investment companies in the same Poors Research Insight Compustat Database 215 This estimate is based on the proportion of (‘‘Compustat’’), and SEC Form 1392. small entities that are reporting companies (2,500) group of related investment companies, 212 See, e.g., Rule 302.00 of NYSE listing to the total domestic companies quoted on the has net assets of $50 million or less as standards and Rule 4350(e) of Nasdaq listing OTCBB or the Pink Sheets (7,317). We derived the of the end of its most recent fiscal standards. latter figure from individuals within the 213 Data obtained from Compustat indicates that organization called http://www.pinksheets.com and there are less than 225 listed operating companies from the OTCBB Web site at http://www.otcbb.com. 204 See id. that are small entities. Information compiled by the 216 The calculation for the total number of small 205 See id. Commission staff indicates that there are less than entities is as follows: 225 listed operating 206 See Stoecklein. 25 listed investment companies that are small companies + 25 listed investment companies + 580 207 See id. entities. non-listed operating companies + 25 non-listed 208 17 CFR 240.0–10(a). 214 6,536–5,257=1,697. investment companies = 855.

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00017 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67008 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

requirements, however, do not mandate company mailing. Alternatively, we 23(a)227 and 36 228 of the Exchange Act, any specific procedures. considered amending or reinterpreting as amended, and sections 8,229 20(a),230 For purposes of the PRA, we Exchange Act Rule 14a–8(i)(8) 219 to 30,231 31,232 and 38 233 of the estimated that it will take an average of allow security holder proposals Investment Company Act, as amended. approximately 3 hours per year for requesting access to the company’s List of Subjects companies, large and small, to comply proxy card for the purpose of making with the new disclosure requirements. nominations. We believe that the 17 CFR Parts 228, 229, 240 and 249 We estimated that 75% of the current disclosure requirements are the compliance burden will be carried by Reporting and recordkeeping most cost-effective approach to address requirements, Securities. the company internally and that 25% of specific concerns related to small the compliance burden will be carried entities because the proposals build on 17 CFR Parts 270 and 274 by outside professionals retained by the existing disclosure requirements. Investment companies, Reporting and company. Thus, we estimate the annual We have drafted the new disclosure recordkeeping requirements, Securities. incremental paperwork burden for a rules to require clear and company subject to the proxy rules will straightforward disclosure of a Text of the Amendments be 2.4 hours per company, which company’s policies and procedures ■ translates into an estimated cost of $204 In accordance with the foregoing, the regarding the nomination of directors Securities and Exchange Commission per company,217 and a cost of and security holder communications. approximately $240 per company for amends Title 17, chapter II of the Code Separate disclosure requirements for of Federal Regulations as follows: the services of outside professionals.218 small entities would not yield the A cost of $444 per small entity may not, disclosure that we believe to be PART 228—INTEGRATED however, constitute a significant necessary to achieve our objectives. In DISCLOSURE SYSTEM FOR SMALL economic impact. That conclusion is addition, the informational needs of BUSINESS ISSUERS based on our analysis of 1,245 small investors in small entities are typically entities available on the Compustat as great as the needs of investors in ■ 1. The general authority citation for database. We found that the average larger companies. Therefore, it did not Part 228 is revised to read as follows: revenue of those small entities is $2.07 seem appropriate to develop separate Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, million per company. Therefore, on requirements for small entities 77k, 77s, 77z–2, 77z–3, 77aa(25), 77aa(26), average, the estimated $444 compliance involving clarification, consolidation, or 77ddd, 77eee, 77ggg, 77hhh, 77jjj, 77nnn, expense will constitute approximately simplification of the disclosure. 77sss, 78l, 78m, 78n, 78o, 78u–5, 78w, 78ll, .02% of a small entity’s revenues, based We have used design rather than 78mm, 80a–8, 80a–29, 80a–30, 80a–37, 80b– on the Compustat data. performance standards in connection 11, and 7201 et seq.; and 18 U.S.C. 1350. E. Agency Action To Minimize Effect on with the new requirements for two * * * * * Small Entities reasons. First, based on our past ■ 2. Amend § 228.401 by adding The Regulatory Flexibility Act directs experience, we believe the disclosure paragraph (g) to read as follows: the Commission to consider significant will be more useful to investors if there are enumerated informational § 228.401 (Item 401) Directors, Executive alternatives that would accomplish the Officers, Promoters and Control Persons. requirements. The mandated disclosures stated objective, while minimizing any * * * * * significant adverse impact on small may be likely to result in a more focused and comprehensive discussion. Second, (g) Describe any material changes to entities. In connection with the the procedures by which security proposals, we considered the following more precise disclosure requirements will promote more consistent disclosure holders may recommend nominees to alternatives: the registrant’s board of directors, where (a) The establishment of differing among a cross-section of public companies because they will have those changes were implemented after compliance or reporting requirements or the registrant last provided disclosure in timetables that take into account the greater certainty as to the required disclosure. In addition, more precise response to the requirements of Item resources available to small entities; 7(d)(2)(ii)(G) of Schedule 14A (b) The clarification, consolidation, or disclosure requirements will improve (§ 240.14a–101), or this Item. simplification of disclosure for small our ability to enforce the rules. entities; Therefore, adding to the disclosure Instructions to paragraph (g) of Item 401: (c) The use of performance rather than requirements in existing proxy and 1. The disclosure required in paragraph (g) design standards; and information statements appears to be the need only be provided in a registrant’s (d) An exemption for small entities most effective method of eliciting the quarterly or annual reports. from coverage under the proposals. disclosure. 2. For purposes of paragraph (g), adoption The Commission has considered a of procedures by which security holders may VII. Statutory Basis and Text of recommend nominees to the registrant’s variety of reforms to achieve its Amendments board of directors, where the registrant’s regulatory objectives. As one possible most recent disclosure in response to the approach, we considered requiring The amendments are being adopted requirements of Item 7(d)(2)(ii)(G) of companies to include the security pursuant to sections 2,220 6,221 7,222 Schedule 14A (§ 240.14a–101), or this Item, holder’s proxy card and materials in the 10,223 and 19 224 of the Securities Act, indicated that the registrant did not have in sections 3(b),225 12, 13,226 14, 15, place such procedures, will constitute a 217 We estimate the average hourly cost of in- material change. house personnel to be $85. This cost estimate is 219 17 CFR 240.14a–8(i)(8). based on data obtained from The SIA Report on 220 15 U.S.C. 77b. 227 15 U.S.C. 78w(a). Management and Professional Earnings in the 221 15 U.S.C. 77f. 228 15 U.S.C. 78mm. Securities Industry (October 2001). 222 15 U.S.C. 77g. 229 15 U.S.C. 80a–8. 218 In connection with other recent rulemakings, 223 230 we have had discussions with several private law 15 U.S.C. 77j. 15 U.S.C. 80a–20(a). firms to estimate an hourly rate of $300 as the cost 224 15 U.S.C. 77s. 231 15 U.S.C. 80a–29. of outside professionals that assist companies in 225 15 U.S.C. 78c(b). 232 15 U.S.C. 80a–30. preparing these disclosures. 226 15 U.S.C. 78m. 233 15 U.S.C. 80a–37.

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00018 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67009

PART 229—STANDARD ■ c. Adding paragraph (h) to Item 7; whether the members of the nominating INSTRUCTIONS FOR FILING FORMS ■ d. Revising the reference ‘‘paragraphs committee are independent, as independence UNDER SECURITIES ACT OF 1933, (d)(3), (f) and (g)’’ in the introductory text for nominating committee members is of paragraph (b) of Item 22 to read defined in the listing standards applicable to SECURITIES EXCHANGE ACT OF 1934 the listed issuer; AND ENERGY POLICY AND ‘‘paragraphs (d)(2) (other than (D) If the registrant is not a listed issuer (as CONVERVATIONS ACT OF 1975— (d)(2)(ii)(D)), (d)(3), (f), (g), and (h)’’; defined in § 240.10A–3), disclose whether REGULATION S–K ■ e. Revising the last sentence of the each of the members of the nominating introductory text of paragraph (b)(14) of committee is independent. In determining ■ 3. The general authority citation for Item 22; whether a member is independent, the Part 229 is revised to read as follows: ■ f. Revising paragraph (b)(14)(ii) of Item registrant must use a definition of independence of a national securities Authority: 15 U.S.C. 77e, 77f, 77g, 77h, 77j, 22; exchange registered pursuant to section 6(a) 77k, 77s, 77z–2, 77z–3, 77aa(25), 77aa(26), ■ g. Removing the semi-colon and ‘‘and’’ of the Act (15 U.S.C. 78f(a)) or a national 77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, from the end of paragraph (b)(14)(iii) of securities association registered pursuant to 77nnn, 77sss, 78c, 78i, 78j, 78l, 78m, 78n, Item 22 and in their place adding a section 15A(a) of the Act (15 U.S.C. 78o–3(a)) 78o, 78u–5, 78w, 78ll, 78mm, 79e, 79j, 79n, period; that has been approved by the Commission 79t, 80a–8, 80a–9, 80a–20, 80a–29, 80a–30, ■ h. Removing paragraph (b)(14)(iv) of (as that definition may be modified or 80a–31(c), 80a–37, 80a–38(a), 80a–39, 80b– Item 22; and supplemented), and state which definition it 11, and 7201 et seq.; and 18 U.S.C. 1350, ■ i. Adding an Instruction directly after used. Whatever definition the registrant unless otherwise noted. paragraph (b)(14)(iii) of Item 22. chooses, it must apply that definition * * * * * The additions and revisions read as consistently to all members of the ■ 4. Amend § 229.401 by adding follows: nominating committee and use the paragraph (j) to read as follows: independence standards of the same national § 240.14a–101 Schedule 14A. Information securities exchange or national securities § 229.401 (Item 401) Directors, executive required in proxy statement. association for purposes of nominating officers, promoters and control persons. Schedule 14A Information committee disclosure under this requirement * * * * * and audit committee disclosure required * * * * * under paragraph (d)(3)(iv) of Item 7 of (j) Describe any material changes to Item 7. Directors and executive officers. the procedures by which security Schedule 14A (§ 240.14a–101); holders may recommend nominees to * * * * * (E) If the nominating committee has a (d)(1) * * * policy with regard to the consideration of any the registrant’s board of directors, where (2)(i) If the registrant does not have a director candidates recommended by security those changes were implemented after standing nominating committee or committee holders, provide a description of the material the registrant last provided disclosure in performing similar functions, state the basis elements of that policy, which shall include, response to the requirements of Item for the view of the board of directors that it but need not be limited to, a statement as to 7(d)(2)(ii)(G) of Schedule 14A is appropriate for the registrant not to have whether the committee will consider director (§ 240.14a–101), or this Item. such a committee and identify each director candidates recommended by security who participates in the consideration of holders; Instructions to paragraph (j) of Item 401: director nominees; (F) If the nominating committee does not 1. The disclosure required in paragraph (j) (ii) Provide the following information have a policy with regard to the need only be provided in a registrant’s regarding the registrant’s director nomination consideration of any director candidates quarterly or annual reports. process: recommended by security holders, state that 2. For purposes of paragraph (j), adoption (A) If the nominating committee has a fact and state the basis for the view of the of procedures by which security holders may charter, disclose whether a current copy of board of directors that it is appropriate for recommend nominees to the registrant’s the charter is available to security holders on the registrant not to have such a policy; board of directors, where the registrant’s the registrant’s Web site. If the nominating (G) If the nominating committee will most recent disclosure in response to the committee has a charter and a current copy consider candidates recommended by requirements of Item 7(d)(2)(ii)(G) of of the charter is available to security holders security holders, describe the procedures to Schedule 14A (§ 240.14a–101), or this Item, on the registrant’s Web site, provide the be followed by security holders in submitting indicated that the registrant did not have in registrant’s Web site address. If the such recommendations; place such procedures, will constitute a material change. nominating committee has a charter and a (H) Describe any specific, minimum current copy of the charter is not available to qualifications that the nominating committee PART 240—GENERAL RULES AND security holders on the registrant’s Web site, believes must be met by a nominating REGULATIONS, SECURITIES include a copy of the charter as an appendix committee-recommended nominee for a to the registrant’s proxy statement at least position on the registrant’s board of directors, EXCHANGE ACT OF 1934 once every three fiscal years. If a current and describe any specific qualities or skills ■ copy of the charter is not available to security that the nominating committee believes are 5. The general authority citation for holders on the registrant’s Web site, and is necessary for one or more of the registrant’s part 240 is revised to read as follows: not included as an appendix to the directors to possess; Authority: 15 U.S.C. 77c, 77d, 77g, 77j, registrant’s proxy statement, identify in (I) Describe the nominating committee’s 77s, 77z–2, 77z–3, 77eee, 77ggg, 77nnn, which of the prior fiscal years the charter was process for identifying and evaluating 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, so included in satisfaction of this nominees for director, including nominees 78j–1, 78k, 78k–1, 78l, 78m, 78n, 78o, 78p, requirement; recommended by security holders, and any 78q, 78s, 78u–5, 78w, 78x, 78ll, 78mm, 79q, (B) If the nominating committee does not differences in the manner in which the 79t, 80a–20, 80a–23, 80a–29, 80a–37, 80b–3, have a charter, state that fact; nominating committee evaluates nominees 80b–4, 80b–11, and 7201 et seq.; and 18 (C) If the registrant is a listed issuer (as for director based on whether the nominee is U.S.C. 1350, unless otherwise noted. defined in § 240.10A–3) whose securities are recommended by a security holder; * * * * * listed on a national securities exchange (J) With regard to each nominee approved registered pursuant to section 6(a) of the Act by the nominating committee for inclusion ■ 6. Amend § 240.14a–101 by: (15 U.S.C. 78f(a)) or in an automated inter- on the registrant’s proxy card (other than ■ a. Revising paragraph (d)(2) of Item 7; dealer quotation system of a national nominees who are executive officers or who ■ b. Revising the reference ‘‘paragraphs securities association registered pursuant to are directors standing for re-election), state (a) through (d)(2)’’ in paragraph (e) of section 15A(a) of the Act (15 U.S.C. 78o–3(a)) which one or more of the following Item 7 to read ‘‘paragraphs (a) through that has independence requirements for categories of persons or entities (d)(1) and (d)(2)(ii)(D)’’; nominating committee members, disclose recommended that nominee: security holder,

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00019 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 67010 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations

non-management director, chief executive holder is the registered holder of the company, a majority of the directors who are officer, other executive officer, third-party securities. If the security holder is not the not ‘‘interested persons’’ of the investment search firm, or other, specified source. With registered owner of the securities, he or she company as defined in section 2(a)(19) of the regard to each such nominee approved by a can submit one of the following to the Investment Company Act of 1940 (15 U.S.C. nominating committee of an investment registrant to evidence the required ownership 80a–2(a)(19)). company, state which one or more of the percentage and holding period: (3) Describe the registrant’s policy, if any, following additional categories of persons or A. A written statement from the ‘‘record’’ with regard to board members’ attendance at entities recommended that nominee: security holder of the securities (usually a broker or annual meetings and state the number of holder, director, chief executive officer, other bank) verifying that, at the time the security board members who attended the prior year’s executive officer, or employee of the holder made the recommendation, he or she annual meeting. investment company’s investment adviser, had held the required securities for at least Instruction to paragraphs (h)(2) and (h)(3): principal underwriter, or any affiliated one year; or In lieu of providing the information required person of the investment adviser or principal B. If the security holder has filed a by paragraphs (h)(2) and (h)(3) in the proxy underwriter; Schedule 13D (§ 240.13d–101), Schedule 13G statement, the registrant may instead provide (K) If the registrant pays a fee to any third (§ 240.13d–102), Form 3 (§ 249.103), Form 4 the registrant’s Website address where such party or parties to identify or evaluate or (§ 249.104), and/or Form 5 (§ 249.105), or information appears. assist in identifying or evaluating potential amendments to those documents or updated Instructions to paragraph (h): nominees, disclose the function performed forms, reflecting ownership of the securities 1. For purposes of this paragraph, by each such third party; and as of or before the date of the communications from an officer or director of (L) If the registrant’s nominating committee recommendation, a copy of the schedule and/ the registrant will not be viewed as ‘‘security received, by a date not later than the 120th or form, and any subsequent amendments holder communications.’’ Communications calendar day before the date of the reporting a change in ownership level, as from an employee or agent of the registrant registrant’s proxy statement released to well as a written statement that the security will be viewed as ‘‘security holder security holders in connection with the holder continuously held the securities for communications’’ for purposes of this previous year’s annual meeting, a the one-year period as of the date of the paragraph only if those communications are recommended nominee from a security recommendation. made solely in such employee’s or agent’s holder that beneficially owned more than 5% 4. For purposes of the registrant’s capacity as a security holder. of the registrant’s voting common stock for at obligation to provide the disclosure specified 2. For purposes of this paragraph, security least one year as of the date the in Item 7(d)(2)(ii)(L), the security holder or recommendation was made, or from a group group must have provided to the registrant, holder proposals submitted pursuant to of security holders that beneficially owned, at the time of the recommendation, the § 240.14a–8, and communications made in in the aggregate, more than 5% of the written consent of all parties to be identified connection with such proposals, will not be registrant’s voting common stock, with each and, where the security holder or group viewed as ‘‘security holder of the securities used to calculate that members are not registered holders, proof communications.’’ ownership held for at least one year as of the that the security holder or group satisfied the * * * * * date the recommendation was made, identify required ownership percentage and holding Item 22. Information required in the candidate and the security holder or period as of the date of the recommendation. investment company proxy statement. security holder group that recommended the Instruction to paragraph (d)(2)(ii): For * * * * * purposes of Item 7(d)(2)(ii), the term candidate and disclose whether the (b) * * * ‘‘nominating committee’’ refers not only to nominating committee chose to nominate the (14) * * * Identify the other standing nominating committees and committees candidate, provided, however, that no such committees of the Fund’s board of directors, identification or disclosure is required performing similar functions, but also to groups of directors fulfilling the role of a and provide the following information about without the written consent of both the each committee, including any separately security holder or security holder group and nominating committee, including the entire board of directors. designated audit committee and any the candidate to be so identified. nominating committee: Instructions to paragraph (d)(2)(ii)(L): * * * * * 1. For purposes of Item 7(d)(2)(ii)(L), the (h)(1) State whether or not the registrant’s * * * * * percentage of securities held by a nominating board of directors provides a process for (ii) The members of the committee and, in security holder may be determined using security holders to send communications to the case of a nominating committee, whether information set forth in the registrant’s most the board of directors and, if the registrant or not the members of the committee are recent quarterly or annual report, and any does not have such a process for security ‘‘interested persons’’ of the Fund as defined current report subsequent thereto, filed with holders to send communications to the board in section 2(a)(19) of the Investment the Commission pursuant to this Act (or, in of directors, state the basis for the view of the Company Act of 1940 (15 U.S.C. 80a– the case of a registrant that is an investment board of directors that it is appropriate for 2(a)(19)); and company registered under the Investment the registrant not to have such a process; * * * * * Company Act of 1940, the registrant’s most (2) If the registrant has a process for Instruction to paragraph (b)(14): For recent report on Form N–CSR (§§ 249.331 security holders to send communications to purposes of Item 22(b)(14), the term and 274.128)), unless the party relying on the board of directors: ‘‘nominating committee’’ refers not only to such report knows or has reason to believe (i) Describe the manner in which security nominating committees and committees that the information contained therein is holders can send communications to the performing similar functions, but also to inaccurate. board and, if applicable, to specified groups of directors fulfilling the role of a 2. For purposes of the registrant’s individual directors; and nominating committee, including the entire obligation to provide the disclosure specified (ii) If all security holder communications board of directors. in Item 7(d)(2)(ii)(L), where the date of the are not sent directly to board members, annual meeting has been changed by more describe the registrant’s process for * * * * * than 30 days from the date of the previous determining which communications will be year’s meeting, the obligation under that Item relayed to board members; and PART 249—FORMS, SECURITIES will arise where the registrant receives the Instruction to paragraph (h)(2)(ii): For EXCHANGE ACT OF 1934 security holder recommendation a reasonable purposes of the disclosure required by this time before the registrant begins to print and paragraph, a registrant’s process for ■ 7. The general authority citation for mail its proxy materials. collecting and organizing security holder Part 249 is revised to read as follows: 3. For purposes of Item 7(d)(2)(ii)(L), the communications, as well as similar or related percentage of securities held by a activities, need not be disclosed provided Authority: 15 U.S.C. 78a et seq. and 7201 recommending security holder, as well as the that the registrant’s process is approved by a et seq.; and 18 U.S.C. 1350, unless otherwise holding period of those securities, may be majority of the independent directors or, in noted. determined by the registrant if the security the case of a registrant that is an investment * * * * *

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Rules and Regulations 67011

■ 8. Amend Form 10–Q (referenced in Item 5. Other Information. ■ b. Redesignating Items 9 and 10 as § 249.308a), Item 5 of Part II—Other * * * * * Items 10 and 11; Information by: (b) Furnish the information required by ■ c. Adding new Item 9; and ■ a. Designating the existing text in Item Item 401(g) of Regulation S–B (§ 228.401). ■ d. Revising the reference ‘‘Item 10’’ in 5 as paragraph (a); * * * * * ■ b. Removing the period at the end of the heading of the Instruction to newly newly designated paragraph (a) and in its PART 270—RULES AND redesignated Item 11 to read ‘‘Item 11.’’ place adding ‘‘; and’’; and REGULATIONS, INVESTMENT The addition reads as follows: ■ c. Adding paragraph (b). COMPANY ACT OF 1940 The addition reads as follows: Note: The text of Form N–CSR does not, and these amendments will not, appear in ■ 10. The authority citation for part 270 Note: The text of Form 10–Q does not, and the Code of Federal Regulations. this amendment will not, appear in the Code continues to read in part as follows: of Federal Regulations. Authority: 15 U.S.C. 80a–1 et seq., 80a– Form N–CSR Form 10–Q 34(d), 80a–37, and 80a–39, unless otherwise * * * * * noted. Item 9. Submission of Matters to a Vote of * * * * * * * * * * Security Holders. Part II—Other Information Describe any material changes to the ■ 11. Amend § 270.30a–2 by: * * * * * procedures by which shareholders may ■ a. Revising the reference ‘‘Item Item 5. Other Information. recommend nominees to the registrant’s 10(a)(2)’’ in paragraph (a) to read ‘‘Item board of directors, where those changes were * * * * * 11(a)(2)’’; and implemented after the registrant last (b) Furnish the information required by ■ b. Revising the reference ‘‘Item 10(b)’’ provided disclosure in response to the Item 401(j) of Regulation S–K (§ 229.401). in paragraph (b) to read ‘‘Item 11(b).’’ requirements of Item 7(d)(2)(ii)(G) of * * * * * Schedule 14A (17 CFR 240.14a–101), or this PART 249—FORMS, SECURITIES Item. ■ 9. Amend Form 10–QSB (referenced in EXCHANGE ACT OF 1934 Instruction: For purposes of this Item, § 249.308b), Item 5 to Part II—Other adoption of procedures by which Information by: PART 274—FORMS PRESCRIBED shareholders may recommend nominees to ■ a. Designating the existing text in Item UNDER THE INVESTMENT COMPANY the registrant’s board of directors, where the 5 as paragraph (a); ACT OF 1940 registrant’s most recent disclosure in ■ b. Removing the period at the end of response to the requirements of Item newly designated paragraph (a) and in its ■ 12. The authority citation for Part 274 7(d)(2)(ii)(G) of Schedule 14A (17 CFR place adding ‘‘; and’’; and continues to read, in part, as follows: 240.14a–101), or this Item, indicated that the ■ c. Adding paragraph (b). registrant did not have in place such The addition reads as follows: Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, procedures, will constitute a material change. 78c(b), 78l, 78m, 78n, 78o(d), 80a–8, 80a–24, Note: The text of Form 10–QSB does not, * * * * * 80a–26, and 80a–29, unless otherwise noted. and this amendment will not, appear in the By the Commission. Code of Federal Regulations. * * * * * ■ 13. Amend Form N–CSR (referenced in Dated: November 24, 2003. Form 10–QSB §§ 249.331 and 274.128) by: Jill M. Peterson, * * * * * ■ a. Revising the reference ‘‘10(a)(1)’’ in Assistant Secretary. Part II—Other Information General Instruction D and paragraphs (c) [FR Doc. 03–29723 Filed 11–26–03; 8:45 am] * * * * * and (f)(1) of Item 2 to read ‘‘11(a)(1)’’; BILLING CODE 8010–01–P

VerDate jul<14>2003 20:00 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4700 E:\FR\FM\28NOR3.SGM 28NOR3 i

Reader Aids Federal Register Vol. 68, No. 229 Friday, November 28, 2003

CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING NOVEMBER

Federal Register/Code of Federal Regulations At the end of each month, the Office of the Federal Register General Information, indexes and other finding 202–741–6000 publishes separately a List of CFR Sections Affected (LSA), which aids lists parts and sections affected by documents published since Laws 741–6000 the revision date of each title. Presidential Documents 3 CFR 989...... 64502 1032...... 66697 Executive orders and proclamations 741–6000 Proclamations: The United States Government Manual 741–6000 1464...... 65385 7727...... 62351 1580...... 62731 Other Services 7728...... 62503 1910...... 62221 Electronic and on-line services (voice) 741–6020 7729...... 62505 1924...... 62221 Privacy Act Compilation 741–6064 7730...... 62507 1941...... 62221 Public Laws Update Service (numbers, dates, etc.) 741–6043 7731...... 64483 1942...... 65829 TTY for the deaf-and-hard-of-hearing 741–6086 7732...... 64485 1943...... 62221 7733...... 64491 1955...... 62221 7734...... 64977 ELECTRONIC RESEARCH 3017...... 66534 7735...... 65153 3021...... 66534 World Wide Web 7736...... 65155 Proposed Rules: 7737...... 65627 457...... 64570 Full text of the daily Federal Register, CFR and other publications 7738...... 66315 is located at: http://www.access.gpo.gov/nara 624...... 65202 7739...... 66319 800...... 65210 Federal Register information and research tools, including Public Executive Orders: 959...... 65643 Inspection List, indexes, and links to GPO Access are located at: 12170 (See Notice of 1423...... 65412 http://www.archives.gov/federallregister/ November 12, E-mail 2003) ...... 64489 9 CFR 12364 (Superseded by 71...... 62225 FEDREGTOC-L (Federal Register Table of Contents LISTSERV) is EO 13318)...... 66317 77...... 65831 an open e-mail service that provides subscribers with a digital 13318...... 66317 form of the Federal Register Table of Contents. The digital form 121...... 62218 Administrative Orders: 130...... 62226, 64504 of the Federal Register Table of Contents includes HTML and Memorandums: PDF links to the full text of each document. 145...... 64507 Memorandum of 147...... 64507 To join or leave, go to http://listserv.access.gpo.gov and select October 20, 2003 ...... 63975 319...... 62228 Online mailing list archives, FEDREGTOC-L, Join or leave the list Presidential 381...... 62228, 63983 Determinations: (or change settings); then follow the instructions. Proposed Rules: No. 2004-05 of PENS (Public Law Electronic Notification Service) is an e-mail 93...... 62386 October 21, 2003 ...... 63977 service that notifies subscribers of recently enacted laws. 94...... 62386, 64274 No. 2004-06 of 95...... 62386 To subscribe, go to http://listserv.gsa.gov/archives/publaws-l.html October 21, 2003 ...... 63979 and select Join or leave the list (or change settings); then follow No. 2004-07 of 10 CFR the instructions. November 1, 2003 ...... 63981 11...... 62509, 65765 FEDREGTOC-L and PENS are mailing lists only. We cannot No. 2004-07 of 25...... 62509, 65765 respond to specific inquiries. November 7, 2003 ...... 65383 No. 2004-09 of 50...... 65386 Reference questions. Send questions and comments about the November 21, 606...... 66534 Federal Register system to: [email protected] 2003 ...... 66693 607...... 66534 The Federal Register staff cannot interpret specific documents or Notices: 1036...... 66534 regulations. Notice of November Proposed Rules: 12, 2003 ...... 64489 2...... 66372 FEDERAL REGISTER PAGES AND DATE, NOVEMBER 50...... 65415 5 CFR 61...... 64993 62213–62350...... 3 532...... 64493 62351–62502...... 4 970...... 66534 11 CFR 62503–62730...... 5 1800...... 66695 102...... 64512 62731–63010...... 6 2600...... 62213 104...... 66699 63011–63732...... 7 3601...... 64979 106...... 64517 63733–63982...... 10 107...... 66699 63983–64262...... 12 7 CFR 110...... 64512, 66699 64263–64490...... 13 20...... 62213 9001...... 66699 64491–64798...... 14 205...... 62215 9003...... 66699 64799–64976...... 17 319...... 63983 9004...... 66699 64977–65152...... 18 331...... 62218 9008...... 66699 65153–65382...... 19 762...... 62221 9031...... 66699 65383–65626...... 20 764...... 62221 9032...... 66699 65627–65828...... 21 905...... 64494 9033...... 66699 65829–66000...... 24 906...... 66001 9034...... 66699 66001–66318...... 25 916...... 64499 9035...... 66699 66319–66692...... 26 917...... 64499 9036...... 66699 66693–67012...... 28 984...... 65629 9038...... 66699

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00001 Fmt 4712 Sfmt 4712 E:\FR\FM\28NOCU.LOC 28NOCU ii Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Reader Aids

Proposed Rules: 748...... 64009 98...... 64296 101...... 62502 110...... 64571 754...... 64009 104...... 62501 113...... 64571 772...... 64009 23 CFR 117 ...... 62524, 62528, 63986, 9004...... 64571 476...... 66338 65174, 65175, 66014, 66343 9034...... 64571 16 CFR 655...... 65496 160...... 62501, 63735 165 ...... 62501, 62524, 63988, 12 CFR 305...... 65631, 65833 24 CFR 64527, 64988, 65177 413...... 66534 17 CFR 21...... 66534 385...... 64200 Proposed Rules: 228...... 64952, 66992 24...... 66534 Proposed Rules: 352...... 65850 229...... 64952, 66992 203...... 65824 117...... 66059, 66062 614...... 65417 240...... 64952, 66992 1006...... 66980 165 ...... 64038, 65227, 65427, 620...... 65417 241...... 65820 1007...... 66980 66064 630...... 65417 249...... 64952, 66992 25 CFR 334...... 65019 13 CFR 270...... 64952, 66992 274...... 64952, 66992 Proposed Rules: 34 CFR 145...... 66534 Proposed Rules: 161...... 64023 84...... 66534 147...... 66534 36...... 66032 26 CFR 85...... 66534 14 CFR 240 ...... 62872, 62910, 62972 668...... 66534 242...... 62972 1 ...... 62516, 63733, 63734, 682...... 66534 23...... 63011, 64520 63986, 65634, 66707 35...... 64799 18 CFR 31...... 63734 36 CFR 39 ...... 62228, 62231, 62233, 602...... 63734, 63986 1209...... 66534 62513, 63013, 64263, 64266, 4...... 63194 284...... 66323 Proposed Rules: 1212...... 66534 64268, 64270, 64802, 64980, 1 ...... 62549, 62553, 63743, 64982, 65157, 66004, 66321 19 CFR 63744, 65346, 65419, 65645, 37 CFR 71 ...... 62514, 62515, 62732, 65646, 65864, 66059, 66776 62733, 62734, 62735, 63017, 206...... 65164 2...... 63019 301...... 62553 7...... 63019 63985, 64522, 64523, 64524, 20 CFR 65159, 65161, 65162, 65163, 27 CFR Proposed Rules: 436...... 66534 1...... 66648 65389, 66699, 66700, 66701 Proposed Rules: 439...... 66534 5...... 66648 73...... 64525 9...... 62259, 63042 91...... 65382 Proposed Rules: 41...... 66648 321...... 63041 28 CFR 95...... 65390 38 CFR 97 ...... 62234, 64983, 64985 404...... 62670 14...... 62516 121...... 65376 408...... 62670 67...... 66534 20...... 64805 135...... 65376 416...... 62670 81...... 62370 21...... 65399 145...... 65376 44...... 66534 21 CFR 83...... 66534 1265...... 66534 544...... 65169, 65170 48...... 66534 1267...... 66534 1...... 63017 902...... 66340 39 CFR Proposed Rules: 16...... 62353 1 ...... 64730, 64993, 65854 20...... 63017, 65392 29 CFR 111...... 66015 21...... 64730, 64993 522...... 65168 94...... 66534 3001...... 65348 25...... 64730, 64993 573...... 65632 98...... 66534 Proposed Rules: 33...... 64730, 64993 1240...... 62353 1471...... 66534 501...... 65429 39 ...... 62405, 62408, 62409, 1310...... 62735 1472...... 66534 551...... 65430 62415, 62544, 62545, 64001, 1404...... 66534 Proposed Rules: 40 CFR 64002, 64006, 64282, 64283, 1405...... 66534 1910...... 64036 64286, 64288, 64290, 64295, Proposed Rules: 1915...... 64036 32...... 66534 64572, 64822, 64823, 64825, 101...... 66040 1926...... 64036, 65018 36...... 66534 64827, 64830, 64994, 64996, 868...... 65014 4022...... 64525 51...... 63021 64998, 65000, 65003, 65005, 870...... 65014 4044...... 64525 52 ...... 62236, 62239, 62501, 65006, 65008, 65011, 65854, 882...... 65014 62529, 62738, 62869, 63021, 65856, 65857, 66026, 66028, 1300...... 62255 30 CFR 63991, 64532, 64537, 64540, 66030, 66382, 66384, 66386, 1301...... 62255 250...... 65172 64543, 65845, 65846, 66000, 66762, 66764, 66765, 66768, 1304...... 62255, 66048 707...... 65622 66343, 66348, 66350 66770, 66772 1306...... 66048 917...... 65835 60...... 62529 71 ...... 62548, 62758, 62759, 1307...... 62255 943...... 62517 63...... 63852, 64432 62760, 62761, 62762, 64008, 1309...... 66048, 66052 906...... 65422 70 ...... 63735, 65401, 65637 64574, 64575, 64832, 65224, 1310...... 66052 917...... 65424 81...... 62239 65417, 65859, 66387 950...... 62519 131...... 62740, 62744 73...... 64833 22 CFR 271...... 64550 91...... 65854 126...... 65633 31 CFR 300...... 62747, 64806 97...... 65854 133...... 66534 19...... 66534 350...... 64720 121 ...... 64730, 64993, 65854 137...... 66534 20...... 66534 1600...... 65403 125...... 65854 208...... 66534 103...... 65392, 66708 Proposed Rules: 129...... 65854 210...... 66534 575...... 65844 Ch. 1 ...... 65120 135 ...... 64730, 64993, 65854 303...... 66006 Proposed Rules: 52 ...... 62263, 62264, 62553, 307...... 66014 103...... 66299, 66305 64576, 65229, 65234, 65646, 15 CFR 310...... 66534 65866, 66388, 66389 26...... 66534 312...... 66534 32 CFR 60...... 62553 29...... 66534 1006...... 66534 25...... 66534 63...... 65648 270...... 66703 1008...... 66534 26...... 66534 81...... 62264 902...... 62501, 64986 1508...... 66534 199...... 65172 93...... 62690 Proposed Rules: 1509...... 66534 122...... 63042 740...... 64009 Proposed Rules: 33 CFR 123...... 65663 742...... 64009 96...... 64296 100 ...... 62524, 63018, 65174 133...... 63042

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00002 Fmt 4712 Sfmt 4712 E:\FR\FM\28NOCU.LOC 28NOCU Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Reader Aids iii

148...... 66164 45 CFR 25...... 66232 637...... 64297 180...... 66390 5b...... 62250 27...... 66232 642...... 64297 260...... 65586 76...... 66534 53...... 65665 651...... 64297 261 ...... 64834, 65586, 66164 82...... 66534 73 ...... 62554, 64578, 64579, 652...... 64297 268...... 66164 620...... 66534 66394, 66781, 66782 653...... 64297 271 ...... 62264, 64578, 66164 630...... 66534 74...... 66232 1801...... 64847 300...... 64843, 65020 1154...... 66534 76...... 66776 1803...... 64847 302...... 66164 1155...... 66534 78...... 66232 1804...... 64847 350...... 64726 1169...... 66534 80...... 66232 1805...... 64847 355...... 64041 1173...... 66534 87...... 66232 1806...... 64847 501...... 65663 1185...... 66534 90...... 64050, 66232 1807...... 64847 1186...... 66534 95...... 66232 1808...... 64847 41 CFR 2542...... 66534 97...... 66232 1809...... 64847 101...... 66232 105-68...... 66534 2545...... 66534 1811...... 64847 1821...... 64847 105-74...... 66534 46 CFR 48 CFR 204...... 64555, 64557 42 CFR 2...... 62501 49 CFR 31...... 62501 208...... 64559 71...... 62353 71...... 62501 210...... 64559 29...... 66534 73...... 62245 91...... 62501 212...... 64557 32...... 66534 400...... 63692 115...... 62501 213...... 64557 383...... 63030 403...... 66710 126...... 62501 216...... 64661 571 ...... 65179, 65404, 66741 405...... 63692 176...... 62501 219...... 64559 579...... 64568 408...... 66721 232...... 62535 252...... 64557, 64559 590...... 65404 410...... 63196, 63398 281...... 62535 5125...... 66738 1572...... 63033 414...... 63196 287...... 62535 5152...... 66740 Proposed Rules: 419...... 63398 295...... 62535 Proposed Rules: 192...... 62555 426...... 63692, 65346 298...... 62535 15...... 66988 195...... 62555 489...... 66710 310...... 62535 31...... 66988 224...... 62942 498...... 66710 355...... 62535 42...... 66988 393...... 64072 Proposed Rules: 380...... 62535 601...... 64297 571 ...... 62417, 65431, 65667 412...... 66920 390...... 62535 602...... 64297 587...... 62421 413...... 66920 603...... 64297 47 CFR 604...... 64297 424...... 66920 50 CFR 1...... 66252 605...... 64297 43 CFR 15...... 66728 606...... 64297 18...... 66744 25...... 62247, 63994 609...... 64297 229...... 65409 4...... 66723 27...... 66252 611...... 64297 622 ...... 62373, 62542, 64820 12...... 66534 51...... 63999 612...... 64297 635...... 63738, 64990 42...... 66534 64 ...... 62249, 62751, 63029 613...... 64297 648...... 62250, 64821 43...... 66534 73 ...... 62539, 62540, 62541, 616...... 64297 660...... 62374, 66352 64555, 66351 617...... 64297 Proposed Rules: 44 CFR 76...... 66728 619...... 64297 17...... 65020, 66395 64...... 62748 Proposed Rules: 622...... 64297 20...... 65023 65 ...... 64809, 64812, 66020 1...... 66232 623...... 64297 300...... 63052 67 ...... 64817, 64819, 66023, 2...... 66232 625...... 64297 600...... 62267, 64578 66024 15...... 66776 626...... 64297 622 ...... 62267, 62422, 66069 206...... 63738 20...... 66232 628...... 64297 635...... 63747, 66783 Proposed Rules: 21...... 66232 630...... 64297 648...... 64579, 66784 67 ...... 63745, 64844, 64845, 22...... 64050, 66232 632...... 64297 660...... 62763, 63053 64846, 66067 24...... 64050, 66232 636...... 64297 679...... 62423, 65676

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00003 Fmt 4712 Sfmt 4712 E:\FR\FM\28NOCU.LOC 28NOCU iv Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Reader Aids

REMINDERS development, and reporting requirements; options, including electronic The items in this list were production operations; published 10-31-03 filing; published 11-28-03 editorially compiled as an aid polar bears and Pacific ENVIRONMENTAL TRANSPORTATION to Federal Register users. walrus; published 11-28- PROTECTION AGENCY DEPARTMENT 03 Inclusion or exclusion from Air programs: Federal Aviation this list has no legal INTERIOR DEPARTMENT Fuels and fuel additives—- Administration significance. Airworthiness directives: Minerals Management Gasoline and diesel fuel Service test method update; Dassault; published 12-1-03 Outer Continental Shelf; oil, published 10-2-03 Univair Aircraft Corp.; RULES GOING INTO gas, and sulphur operations: published 10-14-03 Air quality implementation EFFECT NOVEMBER 28, Civil penalty assessment; Airworthiness standards: 2003 plans; approval and adjustment; published 10- promulgation; various Special conditions— 29-03 States: Hamilton Sundstrand AGRICULTURE PENSION BENEFIT California; published 9-30-03 Model 54460-77E DEPARTMENT propeller; published 11- GUARANTY CORPORATION Nebraska; published 12-1-03 Grain Inspection, Packers 17-03 Government Paperwork Texas; published 9-30-03 and Stockyards elimination Act; Administration implementation: FEDERAL COMMENTS DUE NEXT COMMUNICATIONS General regulations: Electronic transactions; WEEK COMMISSION Review inspection filings, issuances, requirements; published computation of time, and Television stations; table of AGRICULTURE 10-28-03 record retention; published assignments: DEPARTMENT COMMERCE DEPARTMENT 10-28-03 Texas; published 10-22-03 Animal and Plant Health National Institute of TRANSPORTATION HEALTH AND HUMAN Inspection Service Standards and Technology DEPARTMENT SERVICES DEPARTMENT Viruses, serums, toxins, etc.: National Construction Safety Federal Aviation Food and Drug Bovine virus diarrhea and Team Act; implementation; Administration Administration bovine rhinotracheitis published 11-28-03 Airworthiness directives: Medical devices: vaccines; standard DEFENSE DEPARTMENT Eurocopter France; Immunology and requirements; comments published 10-24-03 microbiology devices— due by 12-5-03; published Army Department 10-6-03 [FR 03-25252] TRANSPORTATION Endotoxin Assay; Class II Acquisition regulations: COMMERCE DEPARTMENT Foreign acquisition; DEPARTMENT special controls classification; published National Oceanic and contractors accompanying National Highway Traffic Atmospheric Administration the force; deployment of Safety Administration 10-31-03 West Nile Virus IgM Fishery conservation and contractor personnel in Motor vehicle safety management: support of military standards: Capture Elisa Assay; Alaska; fisheries of operations; published 11- Class II special controls Child restraint systems— Exclusive Economic 28-03 classification; published Harnesses for use on Zone— Solicitation provisions and 10-30-03 school bus seats; Gulf of Alaska groundfish; contract clauses; INTERIOR DEPARTMENT expiration date delay; comments due by 12-1- contractors accompanying published 11-28-03 Surface Mining Reclamation 03; published 10-16-03 the force; published 11- and Enforcement Office [FR 03-26074] 28-03 RULES GOING INTO Permanent program and Gulf of Alaska groundfish; FEDERAL ELECTION EFFECT NOVEMBER 30, abandoned mine land comments due by 12-4- COMMISSION reclamation plan 2003 03; published 11-4-03 Bipartisan Campaign Reform submissions: [FR 03-27605] Act; implementation: West Virginia; published 12- PERSONNEL MANAGEMENT DEFENSE DEPARTMENT Presidential candidates and 1-03 OFFICE Acquisition regulations: nominating conventions; JUSTICE DEPARTMENT Indian Incentive Program; public financing Prevailing rate systems; published 11-14-03 Drug Enforcement comments due by 12-1- Effective date and Administration 03; published 10-1-03 [FR correction; published Controlled substances; 03-24629] 11-28-03 RULES GOING INTO manufacturers, distributors, Service contracts and task HEALTH AND HUMAN EFFECT DECEMBER 01, and dispensers; registration: orders approval; SERVICES DEPARTMENT 2003 Diversion Control Program; comments due by 12-1- Food and Drug registration and 03; published 10-1-03 [FR Administration AGRICULTURE reregistration application 03-24627] Medical devices: DEPARTMENT fee schedule; adjustment; EDUCATION DEPARTMENT Class II devices— Agricultural Marketing published 10-10-03 Grants: Arrhythmia detector and Service PENSION BENEFIT Faith-based organizations; alarm; reclassification Milk marketing orders: GUARANTY CORPORATION eligibility to participate in direct grant, State- and special controls; Central; published 11-28-03 Single-employer plans: published 10-28-03 administered, and other ENERGY DEPARTMENT Allocation of assets— such programs; comments INTERIOR DEPARTMENT Federal Energy Regulatory Interest assumptions for due by 12-1-03; published Fish and Wildlife Service Commission valuing and paying 9-30-03 [FR 03-24292] Marine mammals: Practice and procedure: benefits; published 11- ENERGY DEPARTMENT Incidental take during Cash management 14-03 Energy Efficiency and specified activities— programs— SPECIAL COUNSEL OFFICE Renewable Energy Office Beaufort Sea, AK; oil and Participating FERC- Complaints and allegations; Consumer products; energy gas industry exploration, regulated entities; filing requirements and conservation program:

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00004 Fmt 4712 Sfmt 4711 E:\FR\FM\28NOCU.LOC 28NOCU Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Reader Aids v

Energy conservation South Dakota; comments based on substitution of Religious activities; Federal standards and test due by 12-3-03; published finished petroleum financial assistance; procedures— 11-3-03 [FR 03-27553] derivatives; comments due comments due by 12-1- Clothes washers; Pesticides; tolerances in food, by 12-1-03; published 10- 03; published 9-30-03 [FR comments due by 12-1- animal feeds, and raw 2-03 [FR 03-24856] 03-24296] 03; published 10-31-03 agricultural commodities: INTERIOR DEPARTMENT NATIONAL CREDIT UNION [FR 03-27468] Vinclozolin; comments due Fish and Wildlife Service ADMINISTRATION Clothes washers; by 12-1-03; published 9- Endangered and threatened Credit unions: comments due by 12-1- 30-03 [FR 03-24782] species: Conversion of insured credit 03; published 10-31-03 Zinc phosphide; comments Critical habitat unions to mutual savings [FR 03-27469] due by 12-1-03; published designations— banks; information disclosure; comments due ENERGY DEPARTMENT 9-30-03 [FR 03-24844] Tennessee and by 12-1-03; published 10- Federal Energy Regulatory Superfund program: Cumberland River Basin 1-03 [FR 03-24762] Commission National oil and hazardous mussels; technical Suretyship and guaranty Electric rate and corporate substances contingency correction; comments requirements; maximum regulation filings: plan— due by 12-5-03; borrowing authority; Virginia Electric & Power published 10-6-03 [FR National priorities list comments due by 12-1- Co. et al.; Open for 03-25184] update; comments due 03; published 10-1-03 [FR comments until further Scarlet-chested parakeet by 12-1-03; published 03-24761] notice; published 10-1-03 and turquoise parakeet; 10-30-03 [FR 03-27161] Freedom of Information Act; [FR 03-24818] comments due by 12-1- FEDERAL implementation; comments 03; published 9-2-03 [FR ENVIRONMENTAL COMMUNICATIONS due by 12-1-03; published 03-22225] PROTECTION AGENCY COMMISSION 10-30-03 [FR 03-27310] Migratory bird permits: Air programs; approval and Radio spectrum, efficient use INTERIOR DEPARTMENT promulgation; State plans Icelandic eiderdown; promotion; secondary National Indian Gaming for designated facilities and importation; comments markets development; Commission pollutants: due by 12-4-03; published regulatory barriers Indian Gaming Regulatory Act: Puerto Rico; comments due 9-5-03 [FR 03-22298] elimination; comments due Fee rates; comments due by 12-1-03; published 10- INTERIOR DEPARTMENT by 12-5-03; published 11- by 11-30-03; published 31-03 [FR 03-27483] 25-03 [FR 03-29193] Minerals Management 10-8-03 [FR 03-25472] Air quality implementation Service Radio stations; table of PERSONNEL MANAGEMENT plans; approval and assignments: Outer Continental Shelf; oil, OFFICE promulgation; various North Carolina; comments gas, and sulphur operations: States; air quality planning Health benefits, Federal due by 12-1-03; published Incident reporting employees: purposes; designation of 10-22-03 [FR 03-26682] requirements; comments areas: Federal Employees Health Television stations; table of due by 12-5-03; published Benefits Children’s Equity Arizona; comments due by assignments: 7-31-03 [FR 03-19459] 12-3-03; published 11-3- Act of 2002; INTERIOR DEPARTMENT 03 [FR 03-27263] New York; comments due implementation; comments by 12-1-03; published 10- Surface Mining Reclamation due by 12-1-03; published Air quality implementation 31-03 [FR 03-27430] and Enforcement Office 10-1-03 [FR 03-24792] plans; approval and Prevailing rate systems; promulgation; various HEALTH AND HUMAN Permanent program and comments due by 12-1-03; States: SERVICES DEPARTMENT abandoned mine land reclamation plan published 10-31-03 [FR 03- California; comments due by Food and Drug submissions: 27382] 12-1-03; published 10-30- Administration 03 [FR 03-27267] Reports and guidance Colorado; comments due by SECURITIES AND 12-5-03; published 11-20- EXCHANGE COMMISSION Kentucky; comments due by documents; availability, etc.: 03 [FR 03-28996] Investment companies: 12-3-03; published 11-3- Evaluating safety of 03 [FR 03-27551] antimicrobial new animal JUSTICE DEPARTMENT Fund of funds investments; drugs with regard to their Grants: investment company’s Missouri; comments due by ability to acquire shares microbiological effects on Religious organizations; 12-1-03; published 10-30- of another investment bacteria of human health participation in department 03 [FR 03-27261] company broadened; concern; Open for programs; equal treatment Montana and Wyoming; registration forms comments until further of all program comments due by 12-5- amended; comments due notice; published 10-27-03 participants; comments 03; published 11-5-03 [FR by 12-3-03; published 10- [FR 03-27113] due by 12-1-03; published 03-27265] 8-03 [FR 03-25336] HOMELAND SECURITY 9-30-03 [FR 03-24294] Air quality planning purposes; TRANSPORTATION DEPARTMENT designation of areas: LABOR DEPARTMENT DEPARTMENT California; comments due by Customs and Border Employment and Training Federal Aviation 12-1-03; published 10-31- Protection Bureau Administration Administration 03 [FR 03-27487] Articles conditionally free, Workforce Investment Act; Airworthiness directives: Environmental statements; subject to reduced rate, nondiscrimination and equal Airbus; comments due by availability, etc.: etc.: opportunity provisions: 12-1-03; published 10-30- Coastal nonpoint pollution Caribbean Basin Economic Religious activities; Federal 03 [FR 03-27323] control program— Recovery Act; brassieres; financial assistance; Australia Pty Ltd.; Minnesota and Texas; preferential treatment; comments due by 12-1- AeroSpace Technologies; Open for comments comments due by 12-1- 03; published 9-30-03 [FR comments due by 12-4- until further notice; 03; published 9-30-03 [FR 03-24296] 03; published 10-24-03 published 10-16-03 [FR 03-24796] LABOR DEPARTMENT [FR 03-26899] 03-26087] Drawback: Workforce Investment Act; Boeing; comments due by Hazardous waste program Merchandise processing nondiscrimination and equal 12-1-03; published 11-4- authorizations: fees; claim eligibility opportunity provisions: 03 [FR 03-27672]

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00005 Fmt 4712 Sfmt 4711 E:\FR\FM\28NOCU.LOC 28NOCU vi Federal Register / Vol. 68, No. 229 / Friday, November 28, 2003 / Reader Aids

Bombardier; comments due Section 108 application to pamphlet) form from the programs through March 31, by 12-1-03; published 10- consolidated group Superintendent of Documents, 2004. (Nov. 22, 2003; 117 31-03 [FR 03-27426] members; indebtedness U.S. Government Printing Stat. 1389) income discharge; Office, Washington, DC 20402 General Electric Co.; H.J. Res. 79/P.L. 108–135 comments due by 12-2- cross-reference; (phone, 202–512–1808). The 03; published 10-3-03 [FR comments due by 12-3- text will also be made Making further continuing 03-25000] 03; published 9-4-03 available on the Internet from appropriations for the fiscal McDonnell Douglas; [FR 03-22454] GPO Access at http:// year 2004, and for other comments due by 12-1- Nonaccrual-experience www.access.gpo.gov/nara/ purposes. (Nov. 22, 2003; 117 03; published 10-15-03 method of accounting; use nara005.html. Some laws may Stat. 1391) not yet be available. [FR 03-25979] limitation; cross reference; Last List November 19, 2003 public hearing; comments Saab; comments due by 12- S. 313/P.L. 108–130 due by 12-3-03; published 1-03; published 10-30-03 9-4-03 [FR 03-22459] Animal Drug User Fee Act of [FR 03-27321] 2003 (Nov. 18, 2003; 117 Public Laws Electronic Class E airspace; comments Stat. 1361) Notification Service due by 12-5-03; published LIST OF PUBLIC LAWS H.R. 274/P.L. 108–131 (PENS) 10-21-03 [FR 03-26560] Blackwater National Wildlife TRANSPORTATION This is a continuing list of Refuge Expansion Act (Nov. DEPARTMENT public bills from the current 22, 2003; 117 Stat. 1372) session of Congress which PENS is a free electronic mail Maritime Administration have become Federal laws. It H.R. 2559/P.L. 108–132 notification service of newly Information collection may be used in conjunction Military Construction enacted public laws. To responses; electronic with ‘‘PLUS’’ (Public Laws Appropriations Act, 2004 (Nov. subscribe, go to http:// transmittal options; Update Service) on 202–741– 22, 2003; 117 Stat. 1374) listserv.gsa.gov/archives/ comments due by 12-5-03; 6043. This list is also H.R. 3054/P.L. 108–133 publaws-l.html published 11-5-03 [FR 03- available online at http:// District of Columbia Military 27761] Note: This service is strictly www.nara.gov/fedreg/ Retirement Equity Act of 2003 TREASURY DEPARTMENT plawcurr.html. for E-mail notification of new (Nov. 22, 2003; 117 Stat. laws. The text of laws is not Internal Revenue Service The text of laws is not 1386) available through this service. Income taxes: published in the Federal H.R. 3232/P.L. 108–134 PENS cannot respond to Consolidated return Register but may be ordered To reauthorize certain school specific inquiries sent to this regulations— in ‘‘slip law’’ (individual lunch and child nutrition address.

VerDate jul 14 2003 21:14 Nov 26, 2003 Jkt 203001 PO 00000 Frm 00006 Fmt 4712 Sfmt 4711 E:\FR\FM\28NOCU.LOC 28NOCU