Federal Register July 23,1996 Tuesday 38137 II Federal Register / Vol

Pages 38049±38352 Vol. 61 7±23±96 No. 142 federal register July 23,1996 Tuesday 38137 II Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996

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38138 III

Contents Federal Register Vol. 61, No. 142

Tuesday, July 23, 1996

Agriculture Department Employment and Training Administration See Animal and Plant Health Inspection Service NOTICES See Federal Crop Insurance Corporation Adjustment assistance: See Forest Service Caribou Ltd. et al., 38218–38219 See Natural Resources Conservation Service Easton Composites, Inc., et al., 38219 PROPOSED RULES Fasco Consumer Products, 38219–38220 Export sales reporting: Kendall Healthcare Products Co., 38220 Sunflowerseed and oil, 38107–38108 Kentucky Apparel LLP, 38220 Kinney Shoe Corp., 38220 Alcohol, Tobacco and Firearms Bureau Lakedale Manufacturing, 38221 RULES Lucia, Inc., 38221 Firearms: Maxus Energy Corp. et al., 38222 Commerce in explosives Phillips Petroleum Co. et al., 38222 Plastic explosives; Antiterrorism and Effective Death Pioneer Manufacturing, Inc., 38222–38223 Penalty Act of 1996 relating to plastic explosives; NAFTA transitional adjustment assistance: implementation, 38084–38085 Airshield Corp. et al., 38223–38224 DM IV, Inc. et al., 38224–38225 Animal and Plant Health Inspection Service Ogden Atlantic Design, 38225 PROPOSED RULES Hawaiian and territorial quarantine notices: Energy Department Papaya, carambola, and litchi, 38108–38114 See Federal Energy Regulatory Commission See Hearings and Appeals Office, Energy Department Antitrust Division NOTICES NOTICES Electricity export and import authorizations, permits, etc.: National cooperative research notifications: Calpine Power Services Co., 38190–38191 Aids Drug Development Inter Company Collaboration, Environmental Protection Agency 38215–38216 RULES Air Products and Chemicals, Inc., 38216 Air quality implementation plans; approval and Cable Television Laboratories, Inc., 38216 promulgation; various States: Frame Relay Forum, 38216–38217 Washington, 38086–38091 Intelligent Large Area Processing Consortium, 38217 PROPOSED RULES Light Helicopter Turbine Engine Company Consortium, Air quality implementation plans: 38217 Preparation, adoption, and submittal— Petroleum Environmental Research Forum Project No. 95- Prevention of significant deterioration and 06, 38217–38218 nonattainment new source review; Federal regulatory review, 38250–38344 Children and Families Administration Air quality implementation plans; approval and NOTICES promulgation; various States: Agency information collection activities: Washington, 38129 Proposed collection; comment request, 38205–38206 NOTICES Air pollution control; new motor vehicles and engines: Commerce Department International regulatory harmonization, 38200 See Foreign-Trade Zones Board See International Trade Administration Executive Office of the President See National Oceanic and Atmospheric Administration See Presidential Documents See Trade Representative, Office of United States Committee for the Implementation of Textile Agreements NOTICES Federal Aviation Administration Cotton, wool, and man-made textiles: PROPOSED RULES Honduras, 38236–38238 Air traffic operating and flight rules: Rocky Mountain National Park, CO; special flight rules in Customs Service vicinity, 38119 PROPOSED RULES NOTICES Country of origin marking: Airport noise compatibility program: Frozen imported produce, 38119–38127 Noise exposure map— Tallahassee Regional Airport, TN, 38239–38240 Education Department Global analysis and information network prototype NOTICES development, 38240–38242 Grants and cooperative agreements; availability, etc.: Meetings: Special education and rehabilitative services— Aviation Rulemaking Advisory Committee, 38242 Rehabilitative research fellowships program, etc.; Research, Engineering and Development Advisory correction, 38189–38190 Committee, 38242–38243 IV Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Contents

Federal Communications Commission Financial Management Service NOTICES See Fiscal Service Reporting and recordkeeping requirements, 38200–38201 Fiscal Service Federal Crop Insurance Corporation PROPOSED RULES RULES Marketable book-entry Treasury bills, notes, and bonds; sale Administrative regulations: and issue; uniform offering circular; amendments Crop insurance coverage for production of agricultural Meeting, 38127–38128 commodity on highly erodible land or converted wetland, 38057–38058 Fish and Wildlife Service NOTICES Federal Deposit Insurance Corporation Environmental statements; availability, etc.: NOTICES Incidental take permits— Meetings; Sunshine Act, 38201 Travis County, TX; golden-cheeked warbler, etc., 38212–38213 Federal Emergency Management Agency RULES Food and Drug Administration Flood elevation determinations: RULES Alabama et al., 38092–38099 Medical devices: Georgia et al., 38091–38092 Medical device user facilities and manufacturers; adverse PROPOSED RULES events reporting requirements; certification and Flood elevation determinations: registration— Illinois et al., 38129–38133 NOTICES Manufacturer certification and U.S. designated agent Oklahoma City bombing crisis counseling assistance and provisions effective date stayed and distributor training; extension, 38201–38202 reporting certification requirement revoked, 38346– 38347 Federal Energy Regulatory Commission PROPOSED RULES NOTICES Medical devices: Agency information collection activities: Manufacturer and distributor certification and Proposed collection; comment request, 38191–38193 appointment of U.S. designated agents; adverse Environmental statements; availability, etc.: events reporting requirements, 38348–38352 Butler County Conservation Board, IA, 38194 NOTICES Pine Needle LNG Co., LLC, et al., 38194–38195 Medical devices; premarket approval: Environmental statements; notice of intent: Biomira Diagnostics, Inc.; Truquante BR RIA vitro Total Peaking Services, L.L.C., 38195–38196 diagnostic device, 38206–38207 Hydroelectric applications, 38196–38197 Applications, hearings, determinations, etc.: Foreign-Trade Zones Board Columbia Gas Transmission Corp., 38193 NOTICES Natural Gas Pipeline Co. of America, 38193 Applications, hearings, determinations, etc.: Panhandle Eastern Pipe Line Co., 38193–38194 Michigan— Williams Natural Gas Co., 38194 ESCO Co. Limited Partnership; pigment/dye-type chemicals, 38137–38138 Federal Highway Administration PROPOSED RULES Forest Service Motor carrier safety standards: NOTICES Commercial Driver’s License and Driver Physical Meetings: Qualification Requirements Negotiated Rulemaking Willamette Provincial Interagency Executive Committee Advisory Committee— Advisory Committee, 38137 Meetings, 38133–38135 Health and Human Services Department Federal Railroad Administration See Children and Families Administration NOTICES See Food and Drug Administration Agency information collection activities: See Health Care Financing Administration Submission for OMB review; comment request, 38243 Health Care Financing Administration Federal Reserve System NOTICES NOTICES Medicare: Agency information collection activities: Ambulatory surgical center standards recognition by Joint Proposed collection; comment request, 38202–38203 Commission on accreditation, 38207–38212 Banks and bank holding companies: Change in bank control, 38203 Hearings and Appeals Office, Energy Department Formations, acquisitions, and mergers, 38203–38204 NOTICES Permissible nonbanking activities, 38204 Cases filed, 38198–38200

Federal Trade Commission Indian Affairs Bureau NOTICES NOTICES Premerger notification waiting periods; early terminations, Tribal-State Compacts approval; Class III (casino) gambling: 38204–38205 Puyallup Tribe of Indians, WA, 38213 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Contents V

Interior Department National Credit Union Administration See Fish and Wildlife Service PROPOSED RULES See Indian Affairs Bureau Credit unions: See Land Management Bureau Corporate credit unions; capital strengthening risk See National Park Service management and control, 38117–38119

International Trade Administration National Highway Traffic Safety Administration NOTICES PROPOSED RULES Antidumping: Motor vehicle safety standards: Ferrosilicon from— Hillholder for manual transmission cars, trucks, and sport Brazil, 38138–38139 utility vehicles; petition denied, 38135–38136 Large newspaper printing presses and components Lamps, reflective devices, and associated equipment— (assembled or unassembled) from— Driver side door or door jamb reflectors or reflective Germany, 38166–38189 tape for new cars, light trucks and sport utility Japan, 38139–38166 vehicles; petition denied, 38135 Welded stainless steel butt-weld pipe fittings from— NOTICES Taiwan, 38189 Motor vehicle safety standards: Antidumping duty orders and findings: International regulatory harmonization, 38200 Determinations not to revoke, 38138 National Oceanic and Atmospheric Administration Justice Department RULES See Antitrust Division Fishery conservation and management: See Justice Programs Office Alaska scallop, 38099–38106 NOTICES NOTICES Pollution control; consent judgments: Meetings: Exide Corp et al., 38215 Pacific Fishery Management Council, 38189 Ron Brown Demolition Service & Rain Construction Co., 38215 National Park Service NOTICES Justice Programs Office Environmental statements; availability, etc.: RULES Big Thicket National Preserve, TX; Kriti Exploration & State criminal illegal alien States assistance program Production Co. exploratory oil well drilling, 38214 regulations; CFR part removed, 38085–38086 National Register of Historic Places: NOTICES Grants and cooperative agreements; availability, etc.: Pending nominations, 38214 State criminal alien assistance program, 38218 Realty actions; sales, leases, etc.: Washington, 38214–38215 Labor Department See Employment and Training Administration National Science Foundation See Occupational Safety and Health Administration NOTICES Agency information collection activities: Land Management Bureau Proposed collection; comment request, 38228–38229 NOTICES Realty actions; sales, leases, etc.: National Transportation Safety Board Wyoming, 38213 NOTICES Resource management plans, etc.: Meetings; Sunshine Act, 38229 Safford District, AZ, 38213–38214 Natural Resources Conservation Service Maritime Administration NOTICES NOTICES Committees; establishment, renewal, termination, etc.: Meetings: Foundation Board of Trustees, 38137 Joint Planning Advisory Group, 38243 Nuclear Regulatory Commission National Aeronautics and Space Administration NOTICES RULES Meetings; Sunshine Act, 38231–38232 Grants and cooperative agreements; uniform administrative Applications, hearings, determinations, etc.: requirements: Public Service Electric & Gas Co., 38229–38231 Institutions of higher education, hospitals, and other nonprofit organizations, 38058–38084 Occupational Safety and Health Administration NOTICES NOTICES Inventions, Government-owned; availability for licensing, Agency information collection activities: 38227 Proposed collection; comment request, 38225–38227 Patent licenses; non-exclusive, exclusive, or partially exclusive: Office of United States Trade Representative Consulting Associates, Inc., 38227–38228 See Trade Representative, Office of United States HITCO Technologies, Inc., 38228 J&J Engineering, Inc., 38228 Postal Service Trex Medical Corp., 38228 NOTICES Wheelock, Inc., 38228 Meetings; Sunshine Act, 38232 VI Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Contents

Presidential Documents See Federal Highway Administration PROCLAMATIONS See Federal Railroad Administration Special observances: See Maritime Administration Captive Nations Week (Proc. 6909), 38049 See National Highway Traffic Safety Administration EXECUTIVE ORDERS See Surface Transportation Board Committees; establishment, renewal, termination, etc.: Southeastern Pennsylvania Transportation Authority Treasury Department labor dispute; establishment of emergency board to See Alcohol, Tobacco and Firearms Bureau investigate (EO 13012), 38051 See Customs Service ADMINISTRATIVE ORDERS See Fiscal Service Bosnia and Herzegovina; receipt of defense articles and See Thrift Supervision Office services from Department of Defense (Presidential PROPOSED RULES Determination No. 96-39 of July 6, 1996), 38053 Marketable book-entry Treasury bills, notes, and bonds; sale Bosnia and Herzegovina economic revitalization; aggregate and issue; uniform offering circular; amendments bilateral contributions (Presidential Determination No. Meeting, 38127–38128 96-40 of July 8, 1996), 38055 NOTICES Agency information collection activities: Public Health Service Submission for OMB review; comment request, 38244– See Food and Drug Administration 38245 Securities and Exchange Commission NOTICES Veterans Affairs Department Meetings; Sunshine Act, 38233–38234 NOTICES Self-regulatory organizations; proposed rule changes: Agency information collection activities: American Stock Exchange, Inc., et al., 38234–38235 Proposed collection; comment request, 38245 Applications, hearings, determinations, etc.: Legal interpretations; General Counsel-precedent opinions: MFS Special Value Trust, 38232–38233 Veterans’ benefits under VA administered laws; summary, 38245–38246 Social Security Administration Meetings: NOTICES Minority Veterans Advisory Committee, 38246–38247 Meetings: Representative Payment Advisory Committee, 38235– 38236 Separate Parts In This Issue Surface Transportation Board Part II NOTICES Environmental Protection Agency, 38250–38344 Railroad services abandonment: Consolidated Rail Corp., 38243–38244 Part III Textile Agreements Implementation Committee Department of Health and Human Services, Food and Drug See Committee for the Implementation of Textile Administration, 38346–38352 Agreements

Thrift Supervision Office Reader Aids PROPOSED RULES Additional information, including a list of public laws, Uniform Financial Institutions Rating System; conforming telephone numbers, reminders, and finding aids, appears in amendments, 38114–38117 the Reader Aids section at the end of this issue. Trade Representative, Office of United States NOTICES World Trade Organization: Electronic Bulletin Board Canadian measures affecting periodicals, 38238–38239 Free Electronic Bulletin Board service for Public Law numbers, Federal Register finding aids, and a list of Transportation Department documents on public inspection is available on 202–275– See Federal Aviation Administration 1538 or 275–0920. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / 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 Proclamations: 6909...... 38049 Executive Orders: 13012...... 38051 Administrative Orders Orders: Presidential Determination: 96-39 of July 6, 1996 ...... 38053 96-40 of July 8, 1996 ...... 38055 7 CFR 400...... 38057 Proposed Rules: 20...... 38107 318...... 38108 12 CFR Proposed Rules: 502...... 38114 516...... 38114 562...... 38114 563...... 38114 565...... 38114 574...... 38114 704...... 38117 14 CFR 1260...... 38058 Proposed Rules: 91...... 38119 121...... 38119 127...... 38119 135...... 38119 19 CFR Proposed Rules: 134...... 38119 21 CFR 803...... 38346 804...... 38346 807...... 38346 Proposed Rules: 803...... 38348 804...... 38348 27 CFR 55...... 38084 28 CFR 82...... 38085 31 CFR Proposed Rules: 356...... 38127 40 CFR 52...... 38086 Proposed Rules: 51...... 38250 52 (2 documents) ...... 38129 38250 44 CFR 65 (2 documents) ...... 38901 38092 67...... 38094 Proposed Rules: 67...... 38129 49 CFR Proposed Rules: 383...... 38133 391...... 38133 571 (2 documents) ...... 38125

50 CFR 679...... 38099 38049

Federal Register Presidential Documents Vol. 61, No. 142

Tuesday, July 23, 1996

Title 3— Proclamation 6909 of July 18, 1996

The President Captive Nations Week, 1996

By the President of the United States of America

A Proclamation This year marks the 38th commemoration of Captive Nations Week—a national expression of solidarity and support for all those around the globe who suffer the harshness of oppressive rule. Democracy and human rights have made great advances in recent years, thanks to the courageous efforts of determined men and women. Yet, despite these strides, far too many people throughout the world live without the benefits of freedom. As this century draws to a close, we must remember the millions who still live in fear and the countless children denied the prospect of a bright future by authoritarian regimes. The United States’ commitment to liberty has ensured over 200 years of justice and individual rights for our citizens. We have worked hard to realize our founders’ vision of independence, and we cherish our proud history of offering support and encouragement to others who share that dream. In this post-Cold War era, when ethnic, racial, and religious conflicts pose new challenges to the global community, we must honor that legacy and continue to build a future of international stability and peace. This week and throughout the year, let us rededicate ourselves to the promotion of liberty and universal human rights for those who suffer under the yoke of tyranny in other lands. The United States will continue to champion political freedom for all races, religions, creeds, and nationalities, pledging to keep faith with people everywhere who cherish the fundamental values that Americans have always held dear. The Congress, by Joint Resolution approved July 17, 1959 (73 Stat. 212), has authorized and requested the President to issue a proclamation designat- ing the third week in July of each year as ‘‘Captive Nations Week.’’ NOW, THEREFORE, I, WILLIAM J. CLINTON, President of the United States of America, do hereby proclaim July 21 through July 27, 1996, as Captive Nations Week. I call upon the people of the United States to observe this week with appropriate ceremonies and activities celebrating the principles on which this Nation was established and by which it will forever prosper. IN WITNESS WHEREOF, I have hereunto set my hand this eighteenth day of July, in the year of our Lord nineteen hundred and ninety-six, and of the Independence of the United States of America the two hundred and twenty-first. œ– [FR Doc. 96–18859

Filed 7–22–96; 8:45 am] Billing code 3195–01–P Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Presidential Documents 38051 Presidential Documents

Executive Order 13012 of July 18, 1996

Establishing an Emergency Board To Investigate a Dispute Between the Southeastern Pennsylvania Transportation Authority and Their Employees Represented by the Brotherhood of Locomotive Engineers

A dispute exists between the Southeastern Pennsylvania Transportation Au- thority and its employees represented by the Brotherhood of Locomotive Engineers. The dispute has not heretofore been adjusted under the provisions of the Railway Labor Act, as amended (45 U.S.C. 151 et seq.)(the ‘‘Act’’). A party empowered by the Act has requested that the President establish an emergency board pursuant to section 9A of the Act (45 U.S.C. 159a). Section 9A(c) of the Act provides that the President, upon such request, shall appoint an emergency board to investigate and report on the dispute. NOW, THEREFORE, by the authority vested in me as President, by the Constitution and the laws of the United States, including Section 9A of the Act, it is hereby ordered as follows: Section 1. Establishment of the Board. There is established effective July 19, 1996, a Board of three members to be appointed by the President to investigate this dispute. No member shall be pecuniarily or otherwise interested in any organization of railroad employees or any carrier. The Board shall perform its functions subject to the availability of funds. Sec. 2. Report. The Board shall report to the President with respect to the dispute within 30 days of its creation. Sec. 3. Maintaining Conditions. As provided by Section 9A(c) of the Act, from the date of the creation of the Board and for 120 days thereafter, no change, except by agreement of the parties, shall be made by the carrier or the employees in the conditions out of which the dispute arose. Sec. 4. Records Maintenance. The records and files of the Board are records of the Office of the President and upon the Board’s termination shall be maintained in the physical custody of the National Mediation Board. Sec. 5. Expiration. The Board shall terminate upon submission of the report provided for in section 2 of this order. œ–

THE WHITE HOUSE, July 18, 1996. [FR Doc. 96–18846 Filed 7–22–96; 8:45 am] Billing code 3195–01–P Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Presidential Documents 38053 Presidential Documents

Presidential Determination No. 96–39 of July 6, 1996

Assistance to Bosnia and Herzegovina

Memorandum for the Secretary of State [and] the Secretary of Defense

Pursuant to Section 540(b) of the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1996 (the ‘‘Act’’), I hereby: 1) certify that the transfer of defense articles from stocks of the Department of Defense and defense services of the Department of Defense to Bosnia and Herzegovina will assist that country in self-defense, thereby promoting security and stability of the Balkan region; 2) direct the transfer of up to $100 million in defense articles and defense services from the Department of Defense to assist Bosnia and Herzegovina; 3) delegate to the Secretary of Defense the reporting functions contained in Section 540(c) of the Act. The Secretary of State is authorized and directed to transmit this determination and certification to the appropriate committees of the Congress and to arrange for its publication in the Federal Register. œ–

THE WHITE HOUSE, Washington, July 6, 1996. [FR Doc. 96–18755 Filed 7–22–96; 8:45 am] Billing code 4710–10–M Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Presidential Documents 38055 Presidential Documents

Presidential Determination No. 96–40 of July 8, 1996

Assistance for Bosnia and Herzegovina

Memorandum for the Secretary of State

Pursuant to section 2 of Public Law 104–122 (‘‘the Act’’), I hereby determine and certify that the aggregate bilateral contributions pledged by non-United States donors for economic revitalization are at least equivalent to the U.S. bilateral contributions for economic revitalization made by the Act and in Public Law 104–107. You are authorized and directed to transmit this determination to the appropriate committees of the Congress and to arrange for its publication in the Federal Register. œ–

THE WHITE HOUSE, Washington, July 8, 1996. [FR Doc. 96–18756 Filed 7–22–96; 8:45 am] Billing code 4710–10–M 38057

Rules and Regulations Federal Register Vol. 61, No. 142

Tuesday, July 23, 1996

This section of the FEDERAL REGISTER p.m., Monday through Friday, except total acreage receiving benefits, contains regulatory documents having general holidays. expected prices and yields, the loss of applicability and legal effect, most of which FOR FURTHER INFORMATION CONTACT: USDA benefits (other than crop are keyed to and codified in the Code of Stephen Hoy, Program Analyst, insurance), expected crop insurance Federal Regulations, which is published under benefits, and the expected 50 titles pursuant to 44 U.S.C. 1510. Research and Development Division, Product Development Branch, FCIC, at environmental impact. The Code of Federal Regulations is sold by the Kansas City, MO, address listed Federal costs associated with the the Superintendent of Documents. Prices of above, telephone (816) 926–7730. elimination of crop insurance as a new books are listed in the first FEDERAL sodbuster/swampbuster sanction are REGISTER issue of each week. SUPPLEMENTARY INFORMATION: unknown because the number of Executive Order No. 12866 and producers who will violate sodbuster/ Departmental Regulation 1512–1 swampbuster provisions, and insure DEPARTMENT OF AGRICULTURE crops produced on their farms, is This action has been reviewed under impossible to judge. The actual realized Federal Crop Insurance Corporation USDA procedures established by cost will depend to a large extent on Executive Order No. 12866 and FCIC’s appropriately rating sodbuster 7 CFR Part 400 Departmental Regulation 1512–1. and swampbuster acreage that is planted This action constitutes a review as to and insured. Between $500,000 and $1 RIN 0563±AB59 the need, currency, clarity, and million in crop insurance benefits were effectiveness of these regulations under General Administrative Regulations; denied annually due to sodbuster/ those procedures. The sunset review swampbuster violations in recent years. Food Security Act of 1985, date established for these regulations is Implementation; Denial of Benefits Benefits of a similar magnitude to the June 30, 2001. recent denials will probably be paid in This rule has been determined to be AGENCY: Federal Crop Insurance future years. significant for the purposes of Executive Corporation. Order No. 12866 and therefore has been Paperwork Reduction Act of 1995 ACTION: Interim rule. reviewed by the Office of Management In accordance with the Paperwork SUMMARY: The Federal Crop Insurance and Budget (OMB). Reduction Act of 1995, the information Corporation (FCIC) amends the General Cost-Benefit Analysis collection requirements contained in Administrative Regulations located at 7 these regulations have been previously A Cost-Benefit Analysis has been CFR part 400. The intended effect of this approved by OMB and assigned OMB completed and is available to interested interim rule is to remove restrictions control numbers 0563–0003, 0563–0016 persons at the address listed above. In mandated by the Food Security Act of and 0560–0004. Copies of the summary, the analysis finds that the 1985 that preclude eligibility for crop information collections may be obtained removal of sanctions affecting a insurance for any person who in any from Bonnie Hart, USDA, FSA, producer’s eligibility for Federal crop crop year produces an agricultural Advisory and Corporate Operations insurance as specified in the sodbuster commodity on a field which is classified Staff, Regulatory Review Group, PO Box and swampbuster provisions will result as predominantly highly erodible land 2415, Ag Box 0572, Washington, DC in two types of costs. First, (sodbuster provision) or converted 20013–2415, 8:15 a.m.–4:45 p.m., environmental costs, in some cases, will wetland (swampbuster provision). The Monday through Friday, except be incurred as the elimination of crop Federal Agriculture Improvement and holidays, telephone (202) 690–2857. insurance from the list of denied Reform Act of 1996 (the 1996 Act) benefits reduces the sanctions Unfunded Mandates Reform Act of amends the crop insurance restriction, associated with violating sodbuster/ 1995 so producers who are in violation of the swampbuster provisions. Second, if Title II of the Unfunded Mandate sodbuster/swampbuster provisions will acres affected by the sodbuster/ Reform Act of 1995 (UMRA), Public be eligible for crop insurance coverage swampbuster provisions are Law 104–4, establishes requirements for on or after July 3, 1996. increasingly planted and insured, the Federal agencies to assess the effects of DATES: Effective July 3, 1996. Written costs to the Federal Crop Insurance their regulatory actions on State, local, comments, data, and opinions on this Corporation will rise. The and tribal governments and the private rule will be accepted until close of environmental and Federal costs sector. Under section 202 of the UMRA, business September 20, 1996. associated with elimination of crop FCIC generally must prepare a written ADDRESSES: Interested persons are insurance as a sodbuster/swampbuster statement, including a cost-benefit invited to submit written comments to sanction are, however, largely unknown. analysis, for proposed and final rules the Chief, Product Development Branch, Environmental costs will depend on with Federal mandates that may result Federal Crop Insurance Corporation, the extent farmers produce insurable in expenditures of State, local, or tribal United States Department of Agriculture crops (or alter practices or structures) on governments, in the aggregate, or to the (USDA), 9435 Holmes Road, Kansas sodbuster/swampbuster acreage when private sector, of $100 million or more City, MO 64131. Written comments will such activity would not otherwise in any one year. When such a statement be available for public inspection and occur. Many variables will affect a is needed for a rule, section 205 of the copying in room 0324, South Building, producer’s decision, including the UMRA generally requires FCIC to USDA, 14th and Independence Avenue, amount of land affected by sodbuster/ identify and consider a reasonable SW., Washington, DC., 8:15 a.m.–4:45 swampbuster relative to the producer’s number of regulatory alternatives and 38058 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations adopt the least costly, more cost- officials. See the Notice related to 7 CFR Final Rule effective or least burdensome alternative part 3015, subpart V, published at 48 FR Pursuant to the authority contained in that achieves the objectives of the rule. 29115, June 24, 1983. the Federal Crop Insurance Act, as This rule contains no Federal Executive Order No. 12778 amended (7 U.S.C. 1501 et seq.), the mandates (under the regulatory Federal Crop Insurance Corporation provisions of Title II of the UMRA) for The Office of the General Counsel has hereby amends the General State, local, and tribal governments or determined that these regulations meet Administrative Regulations, (7 CFR part the private sector. Thus, this rule is not the applicable standards provided in 400), effective July 3, 1996, to read as subject to the requirements of sections sections 2(a) and 2(b)(2) of Executive follows: 202 and 205 of the UMRA. Order No. 12778. The provisions of this Executive Order No. 12612 rule will not have a retroactive effect PART400Ð[AMENDED] It has been determined under section prior to the effective date. The 1. The authority citation for 7 CFR 6(a) of Executive Order No. 12612, provisions of this rule will preempt part 400, subpart F, continues to read as Federalism, that this rule does not have State and local laws to the extent such follows: sufficient Federalism implication to state and local laws are inconsistent Authority: Secs, 1506, 1516, Pub. L. 75– warrant the preparation of a Federalism herewith. The administrative appeal 430, 52 Stat. 73, 77, as amended (7 U.S.C. Assessment. The provisions contained provisions in 7 CFR parts 11 and 780 1501 et seq.); sec. 1244, Pub. L. 99–198. in this rule will not have a substantial must be exhausted before any action for judicial review may be brought. § 400.47 [Amended] direct effect on States or their political 2. Section 400.47, Denial of crop subdivisions, or on the distribution of Environmental Evaluation insurance, is amended by removing power and responsibilities among the paragraphs (b), (c), and (e) and This action is not expected to have a various levels of Government. redesignating paragraph (d) as significant impact on the quality of the paragraph (b), paragraph (f) as paragraph Regulatory Flexibility Act human environment, health, and safety. (c), and paragraph (g) as paragraph (d); This regulation will not have a Therefore, neither an Environmental significant impact on a substantial Assessment nor an Environmental § 400.48 [Amended] number of small entities. Under the Impact Statement is needed. 3. Section 400.48, Protection of current regulations, a producer is Background interests of tenants landlords, or required to complete a crop insurance producers, is amended by removing acreage report, an insurance application This final rule amends the General paragraph (b) and redesignating and a continuous contract. If the crop is Administrative Regulations (7 CFR part paragraph (c) as paragraph (b); damaged or destroyed, the insured is 400) as mandated by the Federal § 400.49 [Removed and Reserved] required to give notice of loss and Agriculture Improvement and Reform provide the necessary information to Act of 1996. The 1996 Act removes the 4. Section 400.49, Certification, is complete a claim for indemnity. The sodbuster/swampbuster restrictions of removed and reserved; and insured may use actual records of Title XII of the Food Security Act of § 400.50 [Removed and Reserved] production or receive a transitional 1985 (Pub. L. 99–198) which preclude yield which does not require the 5. Section 400.50, Graduated eligibility for crop insurance under the sanctions, is removed and reserved. maintenance of production records. If Federal Crop Insurance Act (7 U.S.C. the insured elects to use actual records 1501 et seq.), to any person who in any Signed in Washington, DC, on July 16, of acreage and production as the basis crop year produces an agricultural 1996. for the production guarantee, the commodity on highly erodible land or Suzette M. Dittrick, insured must report this information on converted wetland. On or after the Deputy Manager, Federal Crop Insurance a yearly basis. This regulation does not effective date of July 3, 1996, a person Corporation. alter those requirements. Therefore, the who produces an agricultural [FR Doc. 96–18615 Filed 7–22–96; 8:45 am] amount of work required of the commodity on a field which is classified BILLING CODE 3410±FA±P insurance companies and Farm Service as predominantly highly erodible land agency (FSA) offices delivering and or a converted wetland may apply for servicing these policies will not increase crop insurance if the sales closing date NATIONAL AERONAUTICS AND significantly from the amount of work has not passed. Until the effective date, SPACE ADMINISTRATION currently required. This rule does not crop insurance policyholders must have any greater or lesser impact on the remain in compliance with the 14 CFR Part 1260 producer. Therefore, this action is sodbuster/swampbuster provisions. RIN 2700±AA95 determined to be exempt from the Since these provisions are mandated by provisions of the Regulatory Flexibility statute and planting decisions for the Grants and Agreements With Act (5 U.S.C. 605), and no Regulatory 1996 crop year have been or will shortly Institutions of Higher Education, Flexibility Analysis was prepared. be made, it is impracticle and contrary Hospitals, and Other Non-Profit Federal Assistance Program to the public interest to publish this rule Organizations, Uniform Administrative for notice and comment prior to making Requirements (OMB A±110 This program is listed in the Catalog the rule effective. However, comments Implementation) of Federal Domestic Assistance under are solicited for 60 days after the date No. 10.450. AGENCY: Office of Procurement, National of publication in the Federal Register Aeronautics and Space Administration Executive Order No. 12372 and will be considered by FCIC before (NASA). this rule is made final. This program is not subject to the ACTION: Interim rule. provisions of Executive Order No. List of Subjects in 7 CFR Part 400 12372, which require intergovernmental SUMMARY: This rule revises NASA’s consultation with state and local Crop insurance. grant regulations in order to adopt Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38059 uniform administrative requirements. 14 CFR part 1260 is not changed by this Special Conditions Institutions that receive grants from rule and was previously approved under 1260.50 Special conditions. more than one Federal agency may find OMB Control Numbers 2700–0047, 1260.51 Cooperative agreement special it easier to follow the format of these 2700–0048, and 2700–0049. condition. uniform requirements. 1260.52 Multiple year grant. Executive Order 12866 1260.53 Incremental funding. DATES: This rule is effective August 22, 1260.54 Cost sharing. 1996. All comments on this interim rule NASA has determined that this rule is significant under E.O. 12866. This 1260.55 Reports substitution. should be in writing and must be 1260.56 Withholding. received by September 23, 1996. regulation is needed because OMB 1260.57 Training grant reports. Circular No. A–110 encourages agencies ADDRESSES: Rich Kall, Code HK, NASA 1260.58 Interest bearing accounts. to adopt uniform administrative 1260.59 Choice of law. Headquarters, Washington, DC 20546. requirements for grants. The regulation 1260.60 Invention reporting and rights. FOR FURTHER INFORMATION CONTACT: meets that need by adopting the 1260.61 Public information. Rich Kall, (202) 358–0459. requirements of A–110. The potential 1260.62 Allocation of risk/liability. costs and benefits of the regulatory 1260.63 Payment—to foreign organizations. SUPPLEMENTARY INFORMATION: 1260.64 Customs clearance and visas. action are that institutions that receive Background 1260.65 Taxes. grants from more than one Federal 1260.66 Exchange of technical data and This rule revises 14 CFR part 1260 to agency may find it easier to follow the goods. adopt the language of OMB Circular No. format of these uniform requirements. Post-Award Requirements A–110 by using a format similar to the These requirements implement several Department of Energy’s regulation at 10 Federal statutes applicable to grants, 1260.70 Delegation of administration. CFR part 600. A new subpart A provides e.g., civil rights, clean air and water, and 1260.71 Supplements and renewals. drug-free workplace. 1260.72 Adherence to original budget the text of provisions and special estimates. conditions for grants and cooperative List of Subjects in 14 CFR Part 1260 1260.73 Transfers, novations, and change of agreements and addresses NASA’s name agreements. authority, definitions, applicability, Grant programs. 1260.74 Property use, disposition, and amendments, publications, deviations, Tom Luedtke, vesting of title. pre-award requirements, and post-award Deputy Associate Administrator for 1260.75 Reports. requirements currently covered by 14 Procurement. 1260.76 Suspension or termination. CFR part 1260. A new subpart B adopts Accordingly, 14 CFR part 1260 is 1260.77 Closeout procedures. the uniform administrative revised to read as follows: Appendix to Subpart A to Part 1260—Listing requirements of OMB Circular No. A– of Exhibits PART 1260ÐGRANTS AND 110 and includes NASA’s choices in Subpart BÐUniform Administrative alternatives offered by A–110. Because COOPERATIVE AGREEMENTS Requirements for Grants and Cooperative A–110 was already published for public Subpart AÐGeneral Agreements With Institutions of Higher comment, NASA’s adoption of the Education, Hospitals, and Other Non-Profit Sec. Organizations language is being done as an interim 1260.1 Authority. rule. NASA has added subpart C, 1260.2 Definitions. General Administrative Requirements for State 1260.3 Applicability. Sec. and Local Governments (formerly in 1260.4 Amendment. 1260.101 Purpose. OMB Circular A–102 and currently in 1260.5 Publication. 1260.102 Definitions. the agencies’ Grants Management 1260.6 Deviations. 1260.103 Effect on other issuances. Common Rule), which has been codified Pre-Award Requirements 1260.104 Deviations. 1260.105 Subawards. at 14 CFR part 1273, FR 33694, 6–29– 1260.10 Proposals. 95. 1260.11 Evaluation and selection. Pre-Award Requirements Procedural Requirements 1260.12 Choice of award instrument. 1260.110 Purpose. 1260.13 Award procedures. 1260.111 Pre-award policies. Review Under the Regulatory Flexibility 1260.14 Limitations. 1260.112 Forms for applying for Federal Act 1260.15 Format and numbering. assistance. 1260.16 Distribution. The rule was reviewed under the 1260.113 Debarment and suspension. Regulatory Flexibility Act of 1980. Provisions 1260.114 Special award conditions. 1260.115 Metric system of measurement. 1260.20 Provisions. NASA certifies that the rule will not 1260.116 Resource Conservation and 1260.21 Publications and reports. have a significant economic impact on Recovery Act (RCRA). 1260.22 Extensions. a substantial number of small entities. 1260.117 Certifications and representations. 1260.23 Termination and enforcement. Review Under the Paperwork Reduction 1260.24 Change in principal investigator or Post-Award Requirements Act scope. 1260.25 Allowable costs. Financial and Program Management Under 5 CFR 1320.5(b)(2)(i), NASA is 1260.26 Financial management. 1260.120 Purpose of financial and program required to inform potential persons 1260.27 Equipment and other property. management. who are to respond to the collection of 1260.28 Patent rights. 1260.121 Standards for financial information that such persons are not 1260.29 Rights in data. management systems. required to respond to the collection of 1260.30 National security. 1260.122 Payment. information unless it displays a 1260.31 Nondiscrimination. 1260.123 Cost sharing or matching. currently valid OMB control number. 1260.32 Subcontracts. 1260.124 Program income. 1260.33 Clean air and water. 1260.125 Revision of budget and program Under 5 CFR 1320.5(b)(2)(ii)(C), this 1260.34 Procurement standards. plans. paragraph meets that display 1260.35 Foreign national employee 1260.126 Non-Federal audits. requirement by providing the following investigative requirements. 1260.127 Allowable costs. statement: information collection under 1260.36 Travel and transportation. 1260.128 Period of availability of funds. 38060 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

Property Standards § 1260.2 Definitions. Special condition. A term or 1260.130 Purpose of property standards. Additional definitions can be found condition that is not applicable to all 1260.131 Insurance coverage. in § 1260.102. grants or is temporary in nature (see 1260.132 Real property. Administrative grant officer. A § 1260.50). 1260.133 Federally-owned and exempt Federal employee delegated Summary of Research. A document property. responsibility for grant administration; summarizing the results of the entire 1260.134 Equipment. e.g., under a delegation from a NASA project, which includes bibliographies, 1260.135 Supplies and other expendable grant officer. abstracts, and lists of other media in property. Effective date. The date work can which the research was discussed (see 1260.136 Intangible property. begin and the recipient can start § 1260.75(f)(1)). 1260.137 Property trust relationship. spending grant funds. The effective date Supplement. The document NASA Procurement Standards could be earlier or later than the date of uses to effect changes and renewals to 1260.140 Purpose of procurement signature on a basic award or grants and cooperative agreements. standards. modification. They can be awarded unilaterally at the 1260.141 Recipient responsibilities. Extension. A modification of an discretion of the grant officer. 1260.142 Codes of conduct. award, which would otherwise expire, Women-owned small business 1260.143 Competition. to provide additional time, and if concern. A small business concern that 1260.144 Procurement procedures. appropriate, additional funds for is at least 51 percent owned by women 1260.145 Cost and price analysis. completion of project activities. who are U.S. citizens and who also 1260.146 Procurement records. Grant specialist. A Government control and operate the business (15 1260.147 Contract administration. employee who is assigned the U.S.C. 637(d)). 1260.148 Contract provisions. responsibility of negotiating and/or § 1260.3 Applicability. Reports and Records administering grants. Historically Black Colleges and Subparts A and B of this part 1260 1260.150 Purpose of reports and records. establish policies and procedures for all 1260.151 Monitoring and reporting program Universities. Institutions determined by performance. the Secretary of Education to meet the grants and cooperative agreements 1260.152 Financial reporting. requirements of 34 CFR 608.2 and listed awarded by NASA to educational 1260.153 Retention and access therein. institutions and other non-profit requirements for records. Minority educational institution. An organizations. Termination and Enforcement institution determined by the Secretary § 1260.4 Amendment. of Education to meet the requirements This part 1260 will be amended by 1260.160 Purpose of termination and of 34 CFR 637.4. enforcement. Multiple year grant. A grant for which publication of changes in the Federal 1260.161 Termination. Register. Changes that require 1260.162 Enforcement. NASA obligates funds for an initial period and states an intention to immediate dissemination may be issued After-the-Award Requirements obligate funds for one or more as Grant Notices. 1260.170 Purpose. additional periods. The initial period § 1260.5 Publication. 1260.171 Closeout procedures. together with the unfunded periods (a) The NASA Grant and Cooperative 1260.172 Subsequent adjustments and exceeds one year (see § 1260.13(b)). Agreement Handbook is published as continuing responsibilities. Non-profit organization. An part 1260 of title 14 of the Code of 1260.173 Collection of amounts due. organization that qualifies for the Federal Regulations (CFR). exemption from taxation under § 501 of Appendix A to Subpart B of Part 1260— (b) Subscriptions to the NASA Grant Contract Provisions the Internal Revenue Code of 1954, as and Cooperative Agreement Handbook amended, 26 U.S.C. 501. Authority: 42 U.S.C. 2473(c)(1), Pub. L. 97– may be purchased from the Performance Report. A concise Superintendent of Documents, United 258, 96 Stat. 1003 (31 U.S.C. 6301 et seq.), statement of work accomplished during and OMB Circular A–110. States Government Printing Office, the report period (see § 1260.75(e)). Washington, DC 20402, telephone Subpart AÐGeneral Provision. A term or condition number (202) 512–1800. Requests applicable to grants awarded under this should cite GPO Subscription Stock No. § 1260.1 Authority. part 1260 (see § 1260.20). 933–001–00000–8. A subscription Recipient acquired equipment. (a) The National Aeronautics and consists of the basic edition, plus all Equipment purchased or fabricated with changes issued for an indefinite period. Space Administration (NASA) awards grant funds by a recipient for the grants and cooperative agreements performance of work under its grant. § 1260.6 Deviations. under the authority of 42 U.S.C. Small business concern. A concern, (a) A deviation is required for any of 2473(c)(5), the Space Act. This part including its affiliates, which is 1260 is issued under the authority of 42 the following. independently owned and operated, not (1) When a prescribed provision (but U.S.C. 2473(c)(1). dominant in the field of operation in not a special condition) set forth (b) The Office of Management and which it is bidding, and qualifies as a verbatim in this part 1260 is modified Budget (OMB) approved information small business under the criteria and or omitted. collection under the Paperwork size standards in 13 CFR part 121. (2) When a provision is set forth in Reduction Act through September 30, Small disadvantaged business this part 1260, but not for use verbatim, 1998 and assigned OMB control concern. A small business concern and the Center substitutes a provision numbers 2700–0047, Property owned and controlled by individuals which is inconsistent with the intent, Management and Control; 2700–0048, who are both socially and economically principle, and substance of the Patents; and 2700–0049, Financial disadvantaged (within the meaning of provision. Management and Control. OMB control § 8(a (5) and (6) of the Small Business (3) When a form prescribed by this number 2700–0047 applies to grants Act, as amended; 15 U.S.C. 637(a (5) part 1260 is altered or another form is subject to subparts A and B of this part. and (6); and 13 CFR 24). used in its place. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38061

(4) When limitations, imposed by this if preparation of a proposal is 14 CFR part 1265, Governmentwide handbook upon the use of a grant warranted. These discussions should be Debarment and Suspension provision, form, procedure, or any other limited to understanding NASA (Nonprocurement); Governmentwide grant action, are changed. research needs and do not jeopardize requirements for Drug-Free Workplace (5) When a form is created for the unsolicited status of any (Grants), unless excepted by § 1265.110 recipient use that constitutes a subsequently submitted proposal. or § 1265.610; and 14 CFR part 1271 ‘‘Collection of Information’’ within the (b) The proposal shall contain a ‘‘New Restrictions on Lobbying.’’ These meaning of the Paperwork Reduction detailed narrative description of the certifications are required to be Act (44 U.S.C. 35) and its work to be undertaken, including the submitted with each proposal, including implementation in 5 CFR part 1320. objectives of the project and the extensions. NASA does not require any (b) Requests for authority to deviate applicant’s plan for carrying it out. particular form or format, but does from this part 1260 shall be submitted (1) Budget content. All proposals shall require specific language. to the Office of Procurement, NASA include budget data as prescribed in the Headquarters, Contract Management Budget Summary in Exhibit C of the § 1260.11 Evaluation and selection. Division (Code HK). Requests, signed by appendix to this subpart A of this part (a) General. Technical evaluation of the Procurement Officer, shall contain: 1260. Narrative detail must support the proposals will be conducted by the (1) A full description of the deviation, budgets as designated in Exhibit C to cognizant NASA technical office and the circumstances in which it will be Appendix to this subpart. may be based on peer reviews. used, and identification of the (i) Cost issues. The recipient (b) Under NRA’s, AO’s, CAN’s, and requirement from which a deviation is institution is responsible for ensuring other BAA’s. The selecting official will sought; that costs charged are allowable, furnish the grant officer a signed (2) The rationale for the request, allocable, and reasonable under the selection statement and a technical pertinent background information, and applicable cost principles governed by evaluation based on the evaluation the intended effect of the deviation; OMB Circular Nos. A–21 and A–122. criteria stated in the NRA, AO, CAN, or (3) The name of the recipient, For other details see § § 1260.25 and BAA. If a proposal is not selected, the identification of the grant affected, and 1260.127. proposer will be notified in accordance the dollar value; (ii) Indirect Costs. Subject to with the NRA, AO, CAN, or BAA. (4) A statement as to whether the applicable cost principles, rates are (c) Under unsolicited proposals. (1) deviation has been requested negotiated between recipients and the The evaluation of unsolicited proposals previously, and, if so, details of that cognizant agencies assigned under OMB must consider: request; and Circular No. A–21. NASA is required to (i) If the subject of the proposal is (5) A copy of legal counsel’s apply the negotiated rate for all grants available to NASA from another source concurrence or comments. awarded. without restriction. (iii) Cost sharing. NASA may accept (c) Where it is necessary to obtain a (ii) If the proposal closely resembles cost sharing when voluntarily offered, deviation on OMB Circular A–110 a pending competitive acquisition or a and all awards including cost-sharing (Subpart B of this part), Code HK will current, open BAA’s under which the are subject to § § 1260.13(c) and process all necessary documents in unsolicited proposal could be evaluated. 1260.123. The amount of cost sharing accordance with § 1260.104. (iii) If the research proposed will not be a factor in determining demonstrates an innovative and unique Pre-Award Requirements whether to select a proposal for award. method, approach, or concept. However, recipients may be requested to § 1260.10 Proposals. (iv) The proposals overall scientific or secure nonfederal matching funds equal technical merit. (a) A grant can result from: to the program portion to training and (1) An NRA, AO, CAN or BAA. A education grants. (v) The potential contribution to proposal submitted in response to a (2) Multiple year grants. In accordance NASA’s mission. broad agency announcement (BAA) with NASA policy to foster continuity (vi) The offeror’s capabilities, related such as a NASA Research of research, multiple year grant experience, facilities, techniques, or Announcement (NRA), Announcement proposals are encouraged, where unique combinations of these which are of Opportunity (AO), Cooperative appropriate, for a period generally up to integral factors for achieving the Agreement Notice (CAN), an three years. Continuing research proposal objectives. agencywide program announcement programs will be subject to peer (vii) The qualifications, capabilities, such as the Graduate Student Research evaluation at least once every three and experience of the proposed Program, or after approval by the years. Proposals for multiple year grants principal investigator, team leader, or Associate Administrator for shall describe the entire research project key personnel who are critical in Procurement or designee. NRA’s and and include a complete budget for year achieving the proposal objectives. BAA’s are described in the NASA FAR one and separate estimates for each (2) An unsolicited proposal Supplement (NFGS) 48 CFR part 1835. subsequent year (see § 1260.13(b)). recommended for acceptance shall be AO’s are described in 48 CFR part 1870, (c) Certifications and assurances shall supported by a Justification for subpart 1870.1. be made in accordance with § 1260.117, Acceptance of an Unsolicited Proposal (2) An unsolicited proposal. Guidance as follows. (JAUP) prepared by the cognizant on unsolicited proposals is contained in (1) Civil rights requirements. technical office. The JAUP shall be the Federal Acquisition Regulation Annually, recipients must furnish submitted for the approval of the grant (FAR) 48 CFR subpart 15.5 and NFS 48 assurances on NASA Form 1206 of officer after review and concurrence at CFR subpart 1815.5. The synopsis compliance with civil rights statutes a level above the technical officer. The requirement in FAR 48 CFR specified in 14 CFR parts 1250 through grant officer’s signature on the award 15.507(b)(4), however, does not apply to 1252. document will indicate approval. the grant process. Contact with NASA (2) Debarment and suspension, drug- (3) NASA will promptly notify in technical personnel prior to proposal free workplace, and lobbying. NASA writing each organization that submitted submission is encouraged to determine grants are subject to the provisions of: a proposal that will not be funded. 38062 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

Proposals will be returned only when expenditure of grant funds is in phenomena under study, or attempting requested. compliance with the Acts. to determine and exploit the potential of (d) Equipment justification or travel (2) The Administrator may approve scientific discoveries or improvements justification. These documents will be exemptions from this prohibition under in technology, materials, processes, submitted by the technical office for certain circumstances under E.O. 11738. methods, devices, or techniques and grant officer approval when more than Requests for exemptions or renewals advance the state of the art. half of the proposed budget is for thereof shall be made to the Office of (i) The research requires long term equipment or travel and associated Procurement, NASA Headquarters, support (i.e., in excess of one year) for indirect cost. The justification shall Contract Management Division (Code the study to mature to maximum describe the extent to which the HK), Washington, DC 20546. scientific effectiveness (this does not equipment or travel is necessary. preclude shorter-term grants; (3) Proposal budget evaluation. (1) § 1260.12 Choice of award instrument. (ii) NASA desires, or the nature of the The technical officer will review the (a) This section and § 1260.111 proposed investigation is such, that the budget for conformance to program provide guidance on the appropriate recipient will bear prime responsibility requirements and fund availability, choice of award instruments consistent for the conduct of research, and indicating the results of this review in with 31 U.S.C. 6301 to 6308. exercises judgment and original thought Column B of the proposed budget. Throughout § 1260.12, the term ‘‘grant’’ toward attaining the scientific goals (2) The grant officer will review the does not include ‘‘cooperative within broad parameters of the research budget, and any changes made by the agreements.’’ areas proposed and the resources technical officer, to identify any item (b) A procurement contract is a provided; which may be unallowable under the mutually binding legal relationship (iii) Meaningful technical reports (as cost principles, or which appear obligating the seller to furnish supplies distinguished from Performance unreasonable or unnecessary. The grant or services (including construction), and Reports) can be prepared only as new officer will complete Column C of the the buyer pays for them. findings are made, rather than on a proposed budget after discussing (1) The principal purpose of a predetermined time schedule. significant changes with the recipient. procurement contract is to acquire, for (2) An education grant is an Any request for details should be NASA’s direct use or benefit, a well- agreement that provides funds to an limited. defined, specific effort clearly required educational institution or other (f) Incremental funding. NASA for the accomplishment of a scheduled nonprofit organizations within one or reserves the right to either fully fund or NASA mission or project. more of the following areas: incrementally fund grants. Grants with (2) If it is determined that a (i) Capturing student interest and/or anticipated annual funding exceeding procurement contract is the appropriate improving student performance in $50,000 may be funded for less than the type of funding instrument to meet science, mathematics, technology, or amount stated in the proposal, NASA’s purposes, the procurement related fields; provided: shall be conducted under the FAR and (ii) Enhancing the skill, knowledge, or (1) Two increments per grant year are the NFS. ability of teachers or faculty members in authorized. The second increment will (c) A grant shall be used as the legal science, mathematics, or technology; be the balance of funding for the year. instrument to reflect a relationship (iii) Supporting national educational (2) The special condition § 1260.53, between NASA and a recipient reform movements; Incremental Funding, is included in the whenever the principal purpose is the (iv) Conducting pilot programs or grant. transfer of a thing of value to the research to increase participation and/or (g) Printing, binding, and duplicating. recipient to accomplish a public to enhance performance in science, Proposals for efforts that involve purpose of support or stimulation mathematics, or technology education at printing, binding, and duplicating in authorized by Federal statute. The all levels; and excess of 25,000 pages are subject to the following general characteristics meet (v) Developing instructional materials Government Printing and Binding the statutory criteria for use of a grant: (e.g., teacher guides, printed Regulations, No. 26, February 1990, S. (1) Substantial involvement is not publications, computer software, and Pub. 101–9, U.S. Government Printing expected between NASA and the videotapes) or networked information Office, Washington, DC 20402, (202) recipient when carrying out the activity. services for education. 512–1800, published by the (2) The exact course of the work and (3) A training grant is an agreement Congressional Joint Committee on its outcome cannot be defined precisely that provides funds to an educational Printing. The technical office will refer and specific points in time for institution or other non-profit such proposals to the Installation achievement of significant results organization solely by providing Central Printing Management Officer cannot be realistically specified. scholarships, fellowships, or stipends to (ICPMO). The grant officer will be (3) Simplicity and economy in students, teachers, and/or faculty. advised in writing of the results of the execution and administration are (i) NASA training grants are awarded ICPMO review. mutually desirable. to colleges, universities, or other non- (h) Rights in data. Section 1260.29 is (4) Grants are distinguished from profit organizations; not to individual adequate only for grants for basic or contracts in that grants provide financial students, teachers, or faculty members. applied research where the principal or other tangible assistance to the It is the responsibility of the institution purpose (or only expected NASA recipient to carry on a fairly receiving the grant to approve the involvement) is the publication or autonomous research program. faculty, teachers, and/or students who dissemination of the results, such as in (d) The following defines various will participate in the specific program, journals or NASA publications (see types of NASA grants: in cooperation with NASA. If a student, § 1260.21). (1) A research grant is used to teacher, or faculty member ceases to (i) Clean Air and Federal Water accomplish a NASA objective through participate in the program for any Pollution Control Acts. stimulating or supporting the reason, the institution, with prior NASA (1) By accepting a grant that contains acquisition of knowledge or approval, may appoint another student, § 1260.33, the recipient agrees that the understanding of the subject or teacher, or faculty member to complete Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38063 the remaining portion of the grant (ii) To obtain approval, prior to § 1260.13 Award procedures. period. Replacement students, teachers, proceeding with the award a package (a) Multiple year grant. NASA policy and/or faculty electing to apply for the will be forwarded to the Director, is to make maximum use of multiple following program year are not Contract Management Division (HK), year grants to support research projects automatically entitled to an award and that includes pertinent background that may span several years. are subject to the evaluation/selection information, detailed rationale for the (1) At the time a research proposal is procedures administered to new request, dollar value, and name of the recommended for award, a decision will applicants. Any participant receiving recipient. be made whether to award a multiple support under a NASA training grant (e) A cooperative agreement shall be year grant. Special condition § 1260.52, may not concurrently hold another used as the legal instrument to reflect a Multiple Year Grant, would be included Federal fellowship or traineeship. relationship between NASA and a at award. (ii) No applicant shall be denied recipient whenever the principal (i) For the periods approved in consideration or appointment on the purpose is the transfer of a thing of § 1260.52, neither a new proposal nor grounds of race, creed, color, national value to the recipient to accomplish a another technical evaluation is required origin, age, sex, or disability. public purpose of support or unless a special need for review is (iii) Students and faculty receiving stimulation authorized by Federal indicated through monitoring the direct support under a NASA training statute and substantial involvement is project and its reports, by the grant must be U.S. citizens. expected between NASA and the introduction of work outside the scope (iv) Duration of the award is program recipient during performance of the of the approved proposal, or by the need specific. Refer to program policies and contemplated activity. Under 31 U.S.C. for substantial unanticipated funding. procedures for details. Renewal is 6305, characteristics inherent in a (ii) A funded extension beyond the contingent upon a successful cooperative agreement include those period listed in § 1260.52 may be made performance evaluation as prescribed by that apply to a grant, plus the following: by using the provision § 1269.22, the program, concurrence by the NASA (1) Substantial NASA involvement in Extensions. This requires the technical officer, and the availability of and contribution to the technical submission of a new proposal, subject to funds. aspects of the effort are necessary for its full review as discussed in §§ 1260.11 (v) No substantial involvement is accomplishment. This could involve an and 1260.71(b), plus consideration of expected between NASA and the active NASA role in collaborative the timely submission of reports as recipient. A student or faculty member relations, access to a NASA site or required in § 1260.21. receiving support under a NASA equipment, or sharing NASA facilities (2) Normally, each year of a multiple training grant does not incur any formal and personnel; year grant will be funded at the obligation to the Government. (2) The project, conducted as approximate level in the original award (vi) Unused funds may be carried over proposed, would not be possible instrument. However, NASA program into the following program year without without extensive NASA-recipient constraints and developments within further NASA approval. This carry-over technical collaboration; the project may dictate adjustment in amount need not be shown in the (3) The nature of the collaboration can the originally anticipated level. When budget for the next program year. be clearly defined and specified in the actual differs from the planned (vii) The use of training grant funds to advance (special provision § 1260.51 funding, the technical officer shall mark acquire equipment, passenger carrying shall be used). Cooperative agreements up Column B of the budget summary vehicles, land (or any interest therein), would be appropriate, for instance, and send it to the grant officer with an or to acquire or construct facilities will where a university investigator works explanation. The recipient may rebudget not be permitted. Government furnished for a substantial amount of time at a under the grant provisions to keep the equipment will not be provided. NASA Center (or a NASA investigator project within the funding actually (viii) All foreign travel must be clearly works at a university), or when the provided. essential to the research effort and must, collaboration is such that a jointly (b) Annual grant. Grants may be to be charged to a grant, have the prior authored report or education curriculum awarded for a short term (e.g., on an written approval of the NASA technical product is appropriate. annual basis) and may be extended, if officer and the grant officer for each trip, (f) Grants and cooperative agreements appropriate, as described in § 1260.71. regardless of its inclusion in the with foreign organizations are awarded Extensions should be executed prior to proposal budget. under the authority of the Space Act, 42 the grant expiration date. (ix) An Administrative Report must be U.S.C. 2473(c)(5). (c) Cost sharing. NASA grant submitted under the guidelines (1) Before initiating action, the grant recipients usually gain no measurable described by the specific program officer shall coordinate with the benefit from grants, other than policies and procedures. Headquarters Office of External conducting the research. Cost sharing (4) A facilities grant can be issued by Relations, International Relations based on mutuality of interest applies to NASA under the authority of the Space Division (Code IR). Grants to other than NASA grants where the grant officer has Act, 42 U.S.C. 2473(c)(5). It is used to foreign government institutions require reason to believe that the recipient will provide for the acquisition, a review by the Office of General benefit from the research results through construction, use, maintenance, and Counsel. sales to non-Federal entities (see disposition of facilities. Facilities, as (2) It is NASA policy that, in general, § 1260.123) When cost sharing is used, used in this subpart, means property research will be accomplished on a no- the grant officer shall use a Special used for production, maintenance, exchange-of-funds basis with foreign Condition substantially as shown in research, development, or testing. entities. In these cases, NASA enters § 1260.54. (i) Prior approval by the Associate into agreements undertaking projects of (d) Partial support. NASA may Administrator of Procurement and a international scientific collaboration. In provide partial support for a research review by legal counsel to assure legal rare instances, NASA may enter into an project or conference where additional sufficiency are required. It is unlikely an international agreement under which funding may be provided by other award will be made unless funds will be transferred to a foreign Federal agencies. If the grant also Congressionally mandated. recipient. involves cost sharing by the recipient, 38064 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations the grant officer will ensure that Identification Number. They will be at any time during the course of the § 1260.54 applies only to the non- sequentially numbered. investigation. All information disseminated Federal funding. (3) Training grants will use the prefix as a result of the grant shall contain a NGT plus the Center Identification statement which acknowledges NASA’s § 1260.14 Limitations. Number. They will be sequentially support and identifies the grant by number (a) As a matter of policy, NASA does (e.g., ‘‘The material is based upon work numbered. supported by NASA under award No(s) not award grants to commercial firms. (4) The Catalog of Federal Domestic llll’’). However, Cooperative Agreements may Assistance (CFDA) Numbers does not (b) Reports shall be in the English be awarded to commercial firms in apply to NASA grants. language, informal in nature, and ordinarily accordance with § 1260.300. not exceed three pages (not counting (b) NASA does not award grants for § 1260.16 Distribution. bibliographies, abstracts, and lists of other donative assistance purposes, but only Copies of grants and supplements will media). The recipient shall submit the to meet program objectives. Research in be provided to: payment offices (original following reports: any academic discipline related to copy); technical officers; administrative (1) A Performance Report for all but the grant officers when delegated; the final year of the grant. Each report is due 60 NASA interests normally will qualify. days before the anniversary date of the grant However, advice of legal counsel should NASA Center for AeroSpace Information (CASI), Attn: Document and shall briefly describe what was be sought in unusual situations, or accomplished during the reporting period as when unusual project activities or Processing Section, 800 Elkridge outlined in § 1260.151(d). A special organizational attributes are evident. Landing Road, Linthicum Heights, provision specifying more frequent reporting (c) It is NASA’s policy that non- Maryland 21090–2934; and other may be required. monetary (zero dollar) grants or appropriate offices. The statement of (2) A Summary of Research (or Educational cooperative agreements shall not be work accepted by NASA and a copy of Activity Report in the case of Education used (except for no-cost extensions). the approved budget will be provided to Grants) is due within 90 days after the expiration date of the grant, regardless of Loans of Government personal property the administrative grant officers. CASI will also receive the statement of work. whether or not support is continued under not associated with a contract, grant, or another grant. This report shall be cooperative agreement under 31 U.S.C. The file will record the addresses for comprehensive summary of significant 6301 to 6308, and made under the Space distribution. accomplishments during the duration of the Act of 1958, should be consummated as Provisions grant. loan agreements. (c) Performance Reports, Summaries of (d) Grants and cooperative agreements § 1260.20 Provisions. Research, and Education Activity Reports shall not be used as legal instruments (a) The provisions set forth in shall include the following on the first page: (1) Title of the grant. for consulting service arrangements (see §§ 1260.21 through 1260.37 shall be (2) Type of report. 48 CFR subpart 37.2 (FAR) and 48 CFR incorporated by reference and made a (3) Name of the principal investigator. subpart 18237.2 (NFS)). part of NASA research grants, education (4) Period covered by the report. grants, and cooperative agreements with (5) Name and address of the recipient’s § 1260.15 Format and numbering. U.S. educational institutions and institution. (a) General, A grant shall be brief, nonprofit organizations. (6) Grant number. containing only those provisions and (b) In training grants, the provisions of (e) Performance Reports, Summaries of special conditions necessary to protect the following section will be Research, and Education Activity Reports the interests of the Government. incorporated: §§ 1260.22, 1260.23, shall be distributed as follows: (1) The Original to the administration grant (b) Formats. Those shown in Exhibit 1260.25, 1260.26, 126.28, 1260.29, B of the appendix to this subpart A shall officer, with a notice to the grant officer that 1260.31, and 1269.35. a report was sent. be used for the award of all NASA (c) In facilities grants, provisions will (2) One copy, in both hard copy and grants and cooperative agreements. be selected on a case-by-case basis. electronic format, to the technical officer. Computer-generated versions are (d) In research grants awarded to (f) For Summaries of Research and allowed. Provisions for grants with U.S. foreign organizations, the provisions of published reports, one Micro-reproducible organizations shall be incorporated by the following sections, modified as copy shall be sent to the NASA Center for reference, and preprinted checklists necessary, will be in full text: AeroSpace Information (CASI), Attn: may be used. Special conditions and §§ 1260.21, 1260.22, 1260.23, 120.24, Accessioning Department, 800 Elkridge provisions for grants with foreign 1260.26, 1260.27, 1260.32, and 1260.36. Landing Road, Linthicum Heights, Maryland 21090–2934. organizations will be printed in full text. References will not be used to An acceptance block may be added handbooks, statutes, or other regulations § 1260.22 Extensions. when the grant officer finds it necessary which the recipient may neither have Extensions (July 1996) to require bilateral execution of the access to or can realistically be expected grant. When attaching detailed budgets, to comply. (a) It is NASA policy to provide maximum salaries will not be revealed. (e) Whenever the word ‘‘grant’’ possible continuity in funding grant— supported research and educational (c) The identification numbering appears in sections §§ 1260.21 through activities, therefore, grants may be extended system. (1) For research, education, and 1260.38, it shall be deemed to include, for additional periods of time. Any extension facilities grants, numbering shall as appropriate, the term ‘‘cooperative requiring additional funding should be conform to NFS 48 CFR 1804.7102–3, agreement’’. supported by a proposal submitted at least except that a NAG prefix will be used (f) Section 1260.148 and Appendix A three months is advance of the expiration in lieu of the NAS prefix The prefix to subpart B to part 1260 address date of the grant. designation will include the Center provisions to be used in contracts (b) Recipients may extend the expiration Identification Number; e.g., NAG5 awarded by recipients. date of a grant if additional time beyond the established expiration date is required to would be the Goddard prefix § 1260.21 Publications and reports. assure adequate completion of the original designation. They will be sequentially scope of work within the funds already made numbered. Publications and Reports (July 1996) available. For this purpose, in accordance (2) Cooperative agreements will use (a) NASA encourages the widest with § 1260.125(e)(2), the recipient may the prefix NCC plus the Center practicable dissemination of research results unilaterally make a one-time no-cost Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38065 extension, not to exceed 12 months, prior to (d) Comptroller General decisions govern is approved for recipient purchase. If the the established expiration date. Written allowability of costs for international air Government does not exercise its right to take notification of such an extension, with the transportation (see § 1260.37). title to property acquired by the recipient supporting reasons, must be received by the with grant funds at the time of approval, the grant officer at least ten days prior to the § 1260.26 Financial management. property will be considered exempt expiration of the award. Financial Management (July 1996) according to § 1260.133(b). The recipient (c) Requests for approval for all other shall hold title without further obligation to (a) Payment. Advance payments by extensions (in excess of 30 days) must be the Federal Government. electronic funds transfer will be made by the submitted in writing to the grant officer. (b) General purpose equipment items Financial Management Office of the NASA require the prior approval of the Grant § 1260.23 Termination and Enforcement. Center which issued the grant in accordance Officer to be a direct charge, shall be titled with procedures provided to the recipient. Termination and Enforcement (July 1996) The recipient shall submit Federal Cash to NASA, managed in accordance with Termination and enforcement conditions Transaction Reports (SF 272) to the § 1260.134(f), and reported in accordance of this award are specified in §§ 1260.160 aforementioned office and, if NASA has with § 1260.27(e). through 1260.162. If NASA determines that delegated administration, to the (c) Grant funds may be expended for the the recipient has materially failed to comply administrative grant officer, within 15 acquisition of land or interests therein or for with the terms and conditions of the grant, working days following the end of each the acquisition and construction of facilities NASA may suspend or terminate the grant in Federal fiscal quarter, containing current only under a facilities grant, as defined in whole or in part after consultation with the estimates of the cash requirements for each § 1260.12(g). recipient. However, NASA may immediately of the four months following the quarter (d) The recipient shall maintain a property suspend or terminate the award without prior being reported. The final SF 272 is due management system which meets the notice when it believes such action is within 90 days after the expiration date of the requirements of §§ 1260.130 through necessary to protect the interest of the grant. 1260.137. The cognizant property Government. (b) Management and records. Financial administration officer or property and program management requirements of administrator shall be notified of any major § 1260.24 Change in principal investigator §§ 1260.120 through 1260.128 apply to all change to an approved system. or scope. recipients. Financial records, supporting (e) The recipient shall submit an Inventory Change in Principal Investigator or Scope documents, statistical records, and all other Report, to be received no later than October (July 1996) records pertinent to this award shall be 31 of each year, which lists all Federally retained in accordance with § 1260.153. owned property in its custody as of The recipient organization and the September 30. A Final Inventory Report of principal investigator are responsible for the Provisions of § 1260.26(c) shall apply to subcontractors performing substantive work Federally Owned Property, including effective conduct of the project or activity equipment where title was taken by the supported by this award. under this grant. (c) Unexpended balances. Any Government, will be submitted by the (a) The recipient shall obtain the approval recipient no later than 60 days after the of the NASA grant officer to change the unexpended balance of funds which remains expiration date of the grant. principal investigator or to continue the at the end of any funding period, except the (1) All reports will include the information research work during a continuous period in final funding period of the grant, shall be listed in paragraph (f)(1) of § 1260.134, excess of three months without the carried over to the next funding period, and Equipment. participation of an approved principal may be used to defray costs of any funding investigator. Significantly reduced period of the grant. The estimated amount of (2) Negative responses in the Final availability of the services of the principal unexpended funds shall be identified in the Inventory Report, when there is no reportable investigator(s) named in the grant instrument grant budget section of the recipient’s equipment, are required. could be grounds for termination, unless renewal proposal. (3) The original of each report shall be alternatives arrangements are made and (d) Program income will be subject to submitted to the Center Deputy Chief approved in writing by the grant officer. § 1260.124. Financial Officer (Finance). Copies shall be (b) Prior written approval is required from (e) Provisions of § 1260.26(c) shall apply to furnished to the Center industrial property NASA if there is to be a significant change subcontractors performing substantive work officer and to ONR . in the objective or scope. under this grant. § 1260.28 Patent rights. § 1260.27 Equipment and other property. § 1260.25 Allowable costs. Patent Rights (July 1996) Allowable Costs (July 1996) Equipment and Other Property (July 1996) This award is subject to the provisions of (a) The recipient institution is responsible (a) NASA permits acquisition of special 37 CFR 401.3(a) which requires use of the for ensuring that costs charged to this award purpose equipment (as defined in OMB standard clause set out at 37 CFR 401.14 are allowable, allocable, and reasonable Circulars A–21 and A–122) specifically ‘‘Patent Rights (Small Business Firms and under the applicable cost principles defined required and only used for research, medical, Nonprofit Organizations)’’ and the following: in § 1260.127. Sections 1260.24, 1260,27, scientific or other technical activities. (a) Where the term ‘‘contract’’ or 1260.32, and requests for additional funding (1) Acquisition of special purpose ‘‘contractor’’ is used in the ‘‘Patent Rights’’ require prior approvals. equipment, costing in excess of $5,000 and clause, the term shall be replaced by the term (b) Payments to individuals for consultant not included in the approved proposal ‘‘grant’’ or ‘‘recipient,’’ respectively. services under a NASA grant shall not exceed budget, requires the prior approval of the (b) In each instance where the term the daily equivalent of the maximum rate administrative grant officer (unless the item ‘‘Federal Agency,’’ ‘‘agency,’’ or ‘‘funding paid for Level IV of the Executive Schedule, is merely a different model of an item in the Federal agency’’ is used in the ‘‘Patent exclusive of expenses and indirect cost. approved proposal budget). Rights’’ clause, the term shall be replaced by (c) Recipients may incur pre-award costs (2) Title to special purpose equipment the term ‘‘NASA.’’ 90 calendar days prior to award, provided the acquired by the recipient with grant funds, (c) The NASA regulation applicable to costs are necessary for the effective and valued under $5,000 in acquisition cost, shall paragraph (e) of the ‘‘Patent Rights’’ clause is economical conduct of the project and are vest in the recipient and will be considered at 37 CFR Part 404, Licensing of Government- otherwise allowable under the terms of the ‘‘exempt’’ in accordance with § 1260.133(b). owned Inventions. grant. All preaward costs are incurred at the (3) NASA may elect to take title to items (d) The following item is added to the end recipient’s risk. NASA is under no obligation of special purpose equipment valued at more of paragraph (f) of the ‘‘Patent Rights’’ clause: to reimburse such costs if an award is not than $5,000 (acquisition cost each) or when (5) The recipient shall include a list of all subsequently made, or if an award is made fabricated into a single coherent system Subject Inventions required to be disclosed for a lesser amount than the recipient (aggregate acquisition cost). The recipient during the preceding year in the performance anticipated and is insufficient to cover the will be advised of the Government’s report, technical report, or renewal proposal, pre-award costs. intention to take title in writing if the item and a complete list (or a negative statement) 38066 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations for the entire award period shall be included irrevocable license to use, reproduce, any third party without NASA’s written in the summary of research. distribute (including distribution by approval until the aforementioned restricted (e) The term ‘‘subcontract’’ in paragraph (g) transmission) to the public, perform publicly, period expires. of the ‘‘Patent Rights’’ clause shall include prepare derivative works, and display purchase orders. publicly, data in whole or in part and in any § 1260.30 National security. (f) The NASA implementing regulation for manner for Federal purposes and to have or National Security (July 1996) paragraph (g)(2) of the ‘‘Patent Rights’’ clause permit others to do so for Federal purposes is at 48 CFR 1827.373(b). only. Federal purposes include competitive Normally, NASA grants do not involve (g) The following requirement constitutes procurement but do not include the right to classified information. However, if paragraph (1) of the ‘‘Patent Rights’’ clause: have or permit others to use data for information is sought or developed by the (1) Communications. A copy of all commercial purposes. recipient that should be classified in the submissions or requests required by this (3) In order that the Federal Government interests of national security, the NASA grant clause, plus a copy of any reports, may exercise its license rights in data, the officer who issued the grant shall be notified manuscripts, publications or similar material Federal Government, upon request to the immediately. bearing on patent matters, shall be sent to the recipient, shall have the right to review and/ Center Patent Counsel and the administrative or obtain delivery of data resulting from the § 1260.31 Nondiscrimination. grant officer in addition to any other performance of work under this grant, and Nondiscrimination (July 1996) submission requirements in the grant authorize others to receive data to use for provisions. If any reports contain information Federal purposes. (a) To the extent provided by law and any describing a ‘‘subject invention’’ for which (4) If information which recipient applicable agency regulations, this award and the recipient has elected or may elect to considers to embody trade secrets or to any program assisted thereby are subject to retain title, NASA will use reasonable efforts comprise commercial or financial the provisions of Title VI of the Civil Rights to delay public release by NASA or information which is privileged or Act of 1964 (Pub. L. 88–352), Title IX of the publication by NASA in a NASA technical confidential is disclosed orally or visually to Education amendments of 1972 (Pub. L. 92– series until an application filing date has NASA, such information must be reduced to 318), 20 U.S.C. 1681 et seq.), Section 504 of been established, provided that the recipient tangible, recorded form (i.e., converted into the Rehabilitation Act of 1973 (29 U.S.C. identify the information and the ‘‘subject data as defined herein), identified and 794), the Age Discrimination Act of 1975 invention’’ to which it relates at the time of marked with a suitable notice or legend and (Pub. L. 94–135), the implementing submittal. If required by the administrative furnished to NASA within 10 days after such regulations issued pursuant thereto by grant officer, the recipient shall provide the oral or visual disclosure, or NASA shall have NASA, and the assurance of compliance filing date, serial number and title, a copy of no duty to limit or restrict, and shall not which the recipient has filed with NASA. the patent application, and a patent number incur any liability for, any disclosure and use (b) The recipient shall obtain from each and issue date for any ‘‘subject invention’’ in of such information. organization that applies or serves as a any country in which the recipient has (b) Cost Sharing and/or Matching Efforts. subrecipient, contractor or subcontractor applied for patents. When the recipient cost shares with the under this award (for other than the h. NASA Inventions. NASA will use Government on the effort, the following is provision of commercially available supplies, reasonable efforts to report inventions made added: materials, equipment, or general support by NASA employees as a consequence of, or (5) In the event data first produced by services) an assurance of compliance as which bear a direct relation to, the recipient in carrying out recipient’s required by NASA regulations. performance of specified NASA activities responsibilities under an agreement is (c) Work on NASA grants is subject to the under this agreement and, upon timely furnished to NASA, and recipient considers provisions of Title VI of the Civil Rights Act request, will use reasonable efforts to grant such data to embody trade secrets or to of 1964 (Pub. L. 88–352; 42 U.S.C. 2000d–l), recipient an exclusive, or partially exclusive, comprise commercial or financial Title IX of the Education Amendments of revocable, royalty-bearing license, subject to information which is privileged or 1972 (20 U.S.C. 1680 et seq.), section 504 of the retention of a royalty-free right of the confidential, and such data is so identified the Rehabilitation Act of 1973, as amended Government to practice or have practiced the with a suitable notice or legend, the data will (29 U.S.C. 794), the Age Discrimination Act invention by or on behalf of the Government. be maintained in confidence and disclosed of 1975 (42 U.S.C. 6101 et seq.), and the i. In the event NASA contractors are tasked and used by the Government and its NASA implementing regulations (14 CFR to perform work in support of specified contractors (under suitable protective parts 1250, 1251, and 1252). activities under a cooperative agreement and conditions) only for experimental, inventions are made by contractor evaluation, research and development § 1260.32 Subcontracts. employees, and NASA has the right to purposes, by or on behalf of the Government Subcontracts (July 1996) acquire or has acquired title to such for an agreed to period of time, and thereafter inventions, NASA will use reasonable efforts for Federal purposes as defined in (a) For all subcontracts over $25,000 to report such inventions and, upon timely § 1260.29(a)(2). awarded by the recipient, the recipient shall request, will use reasonable efforts to grant c. Add the following paragraph in provide the following to the NASA grant recipient an exclusive, or partially exclusive, Cooperative Agreements. (#) As to data first office for approval. revocable, royalty-bearing license, subject to produced by NASA in carrying out NASA’s (1) A copy of the proposed subcontract. the retention of a royalty-free right of the responsibilities under a cooperative (2) Basis for subcontractor selection. Government to practice or have practiced the agreement and which data would embody (3) Justification for lack of competition invention by or on behalf of the Government. trade secrets or would comprise commercial when competitive bids or offers are not § 1260.29 Rights in data. or financial information that is privileged or obtained. confidential if it has been obtained from the (4) The subcontract budget and basis for Rights in Data (July 1996) recipient, such data will be marked with an subcontract cost or price. (a) Fully Funded Efforts. appropriate legend and maintained in (b) The recipient (with the exception of (1) ‘‘Data’’ means recorded information, confidence for an agreed to period of up to foreign organizations) shall utilize small regardless of form, the media on which it ll years (insert a period of up to 5 years.) business concerns, small disadvantaged may be recorded, or the method of recording, after development of the information, with business concerns, Historically Black created under the grant. The term includes, the express understanding that during the Colleges and Universities, minority but is not limited to, data of a scientific or aforesaid period such data may be disclosed educational institutions, and women-owned technical nature, and any copyrightable work and used (under suitable protective small business concerns as subcontractors to in which the recipient asserts copyright, or conditions) by or on behalf of the the maximum extent practicable. for which copyright ownership was Government for Government purposes only, (c) All contracts awarded by a recipient, purchased, under the grant. and thereafter for any purpose whatsoever including small purchases, shall contain the (2) The recipient grants to the Federal without restriction on disclosure and use. provisions found in appendix A to subpart B Government, a royalty-free, nonexclusive and Recipient agrees not to disclose such data to of part 1260, as applicable. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38067

§ 1260.33 Clean Air and Water. Special Conditions Third year $llll, Anticipated funding date llll. Clean Air and Water (July 1996) § 1260.50 Special conditions. (Periods may be added or omitted, as (Applicable only if the award exceeds (a) In addition to the provisions set forth applicable). $100,000, or a facility to be used has been the in §§ 1260.21 through 1260.37, NASA grants § 1260.53 Incremental funding. subject of a conviction under the Clean Air are subject to special conditions, which Act (42 U.S.C. 1857c–8(c)(1) or the Federal either are not applicable to all awards or are Incremental Funding (July 1996) Water Pollution Control Act (42 U.S.C. temporary in nature. Examples are found in Only $llll of the amount indicated on 1857c–8(c)(1) or the Federal Water Pollution §§ 1260.51 through 1260.66, but NASA may the face of this award is available for Control Act (33 U.S.C. 1319(c)), and 9s listed impose other conditions as discussed in payment and allotted to this award. NASA by EPA, or if the award is not otherwise § 1260.114 or as the requirements dictate. A contemplates making an additional allotment exempt). deviation to this handbook is not required for in the amount of $llll by llll. The recipient agrees to he following: changes to special conditions. These funds will be obligated as appropriated (a) Comply with applicable standards, (b) Special conditions will be printed in funds become available without any action orders or regulations issued pursuant to the full text. required by the recipient. The recipient will Clean Air Act, as amended (42 U.S.C. 7401, (c) For training grants, use § 1260.57 plus be given written notification by the NASA et seq.) and of the Federal Water Pollution any other special conditions necessary. grant officer. NASA is not obligated to Control Act (33 U.S.C. 1251 et seq.). (d) In facilities grants, special conditions reimburse the recipient for the expenditure of (b) That no portion of the work under this will be selected on a case-by-case basis. As amounts in excess of the total funds allotted award will be performed in a facility listed appropriate, the requirements of the by NASA. on the Environmental Protection Agency following sections will apply: §§ 1260.132, (EPA) List of Violating Facilities on the date Real property; 1260.123(c), Cost sharing or § 1260.54 Cost sharing. that this award was effective unless and until matching; and 1260.125(h), Revision of the EPA eliminates the name of such facility budget and program plans. Cost Sharing (July 1996) or facilities from such listings. (e) Research grants with foreign (a) NASA and the recipient will share in (c) Use its best efforts to comply with clear organizations will include special conditions providing the resources necessary to perform air standards and clean water standards at §§ 1260.58 through 1260.62, modified as the agreement. NASA funding and non-cash the facility in which the award is being necessary, when not covered under a contributions (personnel, equipment, preformed. Memorandum of Agreement (MOA). In facilities, etc.) and the dollar value of the (b) Insert the substance of the provisions of addition, other clauses (e.g., §§ 1260.63 recipient’s cash and/or non-cash contribution this clause into any nonexempt subward or through 1260.66) will be written with the aid will be on a ll percent NASA; ll percent contract under the award. of General Counsel, and added when recipient basis. Criteria and procedures for (e) Report violations to NASA or to EPA. necessary. the allowability and allocability of cash and non-cash contributions shall be governed by § 1260.34 Procurement standards. § 1260.51 Cooperative agreement special § 1260.123, Cost Sharing or Matching. The condition. Procurement Standards (July 1996) applicable Federal cost principles are cited in § 1260.127. a. The recipient shall maintain a Cooperative Agreement Special Condition (b) The recipient’s share shall not be procurement system which, at a minimum, (July 1996) charged to the Government under this meets the requirements set forth in (a) This award is a cooperative agreement agreement or under any other contract, grant, §§ 1260.140 through 1260.148. as it is anticipated there will be substantial or cooperative agreement. b. Procurement programs funded with NASA involvement during performance of Federal funds shall give preference to he the effort. NASA and the recipient mutually § 1260.55 Reports substitution. purchase of recycled products pursuant to agree to the following statement of EOA guidelines. anticipated cooperative interactions which Reports Substitution (July 1996) may occur during the performance of this Technical Reports may be substituted for § 1260.35 Foreign national employee effort: the required Performance Reports. The title investigative requirements. (Reference the approved proposal that page of such reports shall clearly indicate Foreign National Employee Investigative contains a detailed description of the work that the substitution has been made and will Requirements (July 1966) and insert a concise statement of the exact show the period covered by the originally nature of the cooperative interactions that required Performance Report. (a) The recipient agrees to provide the deals with existing facts and not information requested by NASA to allow the contingencies.) § 1260.56 Withholding. recipient’s access to a NASA Center for (b) The terms ‘‘grant’’ and ‘‘recipient’’ Withhold (July 1996) performance of this grant. All visit requests mean ‘‘cooperative agreement’’ and must be submitted in a timely manner in ‘‘recipient of cooperative agreement,’’ Pending receipt of a satisfactorily accordance with instructions provided by the respectively, wherever the terms appear in completed Summary of Research and/or Center(s) to be visited. provisions and special conditions included other reports required under NASA grant No. (b) The recipient acknowledges that NASA in this agreement. llll, the Financial Management Office reserves the right to perform security checks (c) NASA’s ability participate and perform will withhold all payments under this grant on foreign national visitors, and to deny or its collaborative effort under this cooperative (including advance payments). The grant restrict access to a NASA Center, facility, agreement is subject to the availability of officer will notify the NASA Financial computer system, or technical information in appropriated funds and nothing in this Management Office when payments can the interest of national security. cooperative agreement commits the United resume. States Congress to appropriate funds therefor. § 1260.36 Travel and transportation. § 1260.57 Training grant reports. § 1260.52 Multiple year grant. Travel and Transportation (July 1996) Training Grant Reports (July 1996) (a) The Fly America Act, 49 U.S.C. 40118, Multiple Year Grant (July 1996) No later than 60 days after the ending date requires the recipient to use U.S. flag air This is a multiple year grant. Contingent on of the grant, the recipient will provide the carriers for international air transportation of the availability of funds, scientific progress of NASA Headquarters Office of Human personnel and property to he extent that the project, an continued relevance to NASA Resources and Education an Administrative service by those carriers is available. programs, NASA anticipates continuing Report that details the fellow’s research and (b) Department of Transportation support at approximately the following academic progress. Pertinent information regulations, 49 CFR part 173, govern levels: relating to the student, including the degree recipient shipment of hazardous materials Second year $llll, Anticipated granted and employment plans, are to be and other items. funding date llll. included. Students are required to submit a 38068 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

Student Evaluation Form to the subcontractor employees, or to the loss of its Withholding (§ 1260.56), and Novations administrative contact at the Center property or that of its contractors and (§ 1260.74). Renewal of grant (§ 1260.22) monitoring the work 90 days prior to the subcontractors, whether such injury, death, is a unilateral decision by NASA based ending date of the fellowship. damage or loss arises through negligence or upon availability of funds, continued otherwise, except in the case of willful § 1260.58 Interest bearing accounts. misconduct. research relevance, and progress made by the recipient. Interest Bearing Accounts (July 1996) b. In addition, the recipient agrees to indemnify and hold the U.S. Government (b) To eliminate the paperwork Advances of federal funds shall be and its contractors and subcontractors maintained in interest-bearing accounts. burdens associated with closeout and harmless from any third party claim, negotiations for a new grant, ongoing Interest earned on federal advances deposited judgment, or cost arising from the injury to in such accounts shall be remitted to DHHS or death of any person, or for damage to or efforts to continue the same effort at the at least quarterly, as instructed by the loss of any property, arising as a result of its same institution will be accomplished Financial Management Office of the NASA possession or use of any U.S. Government by modifying the current instrument, Center which issued the grant. Interest property. unless there is a significant change in amounts up to $250 per year may be retained by the recipient. the nature of the work or closure would § 1260.63 PaymentÐto foreign be in the best interest of the organizations. § 1260.59 Choice of law. Government. Payment—To Foreign Organizations Choice of Law (July 1996) (1) Grants should be renewed prior to (For grants or cooperative agreements with The rights and obligations of the parties to their expiration date. When possible, foreign organizations, this clause will be the grant (or cooperative agreement) shall be the period of performance should be developed on a case-by-case basis.) ascertainable by recourse to the laws of the continuous with the prior grant. If United States of America. However, it is § 1260.64 Customs clearance and visas. otherwise acceptable, NASA may fund understood that the laws of the recipient’s an extension through a multiple year Customs Clearance and Visas country will generally apply to recipient grant (§ 1260.13(a)) or by extending the activities within that country. (For grants or cooperative agreements with existing grant. Such extensions (other foreign organizations, this clause will be § 1260.60 Invention reporting and rights. than no-cost extensions) must be developed on a case-by-case basis.) Invention Reporting and Rights (July 1996) supported by a new proposal from the § 1260.65 Taxes. recipient. (a) As used in this provision: (1) The term ‘‘invention’’ means any Taxes (2) To insure continuation, the invention, discovery or improvement: (For grants or cooperative agreements with technical office should forward to the (2) The term ‘‘made’’ means the conception foreign organizations, this clause will be grant office a complete technical or first actual demonstration that the developed on a case-by-case basis.) evaluation, support documentation, invention is useful and operable. and/or a funded Procurement Request at (b) The recipient shall report promptly to § 1260.66 Exchange of technical data and least 45 days before the expiration of the the grant officer each invention made in the goods. performance of work under this grant. The funded period. report of such invention shall: Exchange of Technical Data and Goods Although the grant officer has little (1) Identify the inventor(s) by full name; (For grants or cooperative agreements with control over the timely receipt of and foreign organizations, this clause will be purchase requests, he/she is responsible (2) Include such full and complete developed on a case-by-case basis.) technical information concerning the for informing the technical officer of invention as is necessary to enable an Post-Award Requirements current lead-time requirements and for understanding of the nature and operation timely processing continuation § 1260.70 Delegation of administration. thereof. agreements. (a) Pursuant to the Government-wide (c) The recipient hereby grants to the (3) The technical office will notify the Government of the United States of ‘‘cross-servicing’’ policy, NASA grants recipient if the grant is to be funded or American, as represented by the and cooperative agreements shall be if additional information is required. Administrator of the National Aeronautics delegated for full administration Alternatively, if a grant is not to be and Space Administration, the full rights, (including property and closeout) to the renewed, the program office should give title, and interest in and to each such Office of Naval Research (ONR). invention throughout the world except the grant officer and the recipient 30- Exceptions to this policy must be llllllllll. day notice. approved by the Procurement Officer, § 1260.61 Public information. documented, and made part of the file. (c) Requests by the recipient to modify a grant must be in writing to the Public Information (July 1996) (b) Delegations will be made by using NASA Form NF 1671. The grant officer grant officer. Examples might include Information regarding this grant (including will strike out any parts of the form that changes in principal investigator or a copy of this award document) may be additional funding. After concurrence released by the recipient without restriction. do not apply and write in specific However, technical information relating to instructions regarding actions requiring by the program manager, a grant work performed under this grant where there ONR involvement. The grant officer will supplement will be unilaterally issued was a NASA contribution should be released inform the recipient, in writing, that a at the discretion of the grant officer. by the recipient only after consultation with delegation has been made. (d) A single no-cost extension for up the NASA Technical Officer. (c) ONR will acknowledge this to 12 months can be unilaterally issued delegation by returning a NF 1431 to the § 1260.62 Allocation of risk/liability. by the recipient as detailed in paragraph grant officer within five days of receipt. (b) of the provision § 1260.22, Allocation of Risk/Liability (July 1996) § 1260.71 Supplements and renewals. Extensions. a. With respect to activities undertaken under this agreement, the recipient agrees not (a) A NASA grant officer can (e) When two or more actions are to make any claim against NASA or the U.S. unilaterally make minor or completed on a single supplement, the Government with respect to the injury or administrative changes to a grant; e.g., supplement will reflect the effective death of its employees or its contractors and Reports Substitution (§ 1260.55), date of the earliest action. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38069

§ 1260.72 Adherence to original budget acquires title to items of recipient components, the property will be estimates. acquired equipment or when NASA considered to be exempt. The (a) Although NASA assumes no transfers an item of Government requirement for agreement regarding responsibility for budget overruns, the property to a recipient as Federally NASA’s retention of its option to take recipient may spend grant funds owned property, the administrative title shall further apply where it is without strict adherence to individual grant officer shall notify both the expected that one or more recipient- allocations within the proposed cognizant NASA Center financial acquired components costing $5,000 or budgets, except as provided in management officer and the equipment less will be fabricated into a single §§ 1260.27 and 1260.32. management officer to ensure proper coherent system costing in excess of (b) The revision of budgets and entries in financial and property $5,000. However, an item that is used program plans are covered in accounting records. ancillary to a system, without loss of its § 1260.125. (d) NASA policy encourages titling as separate identity and usefulness, will be ‘‘exempt’’ all property acquired by a considered as a separate item and not as § 1260.73 Transfers, novations, and nonprofit organization whose primary an integral component of the system. change of name agreements. purpose is the conduct of scientific (a) Transfer of grants. Novation as research, without further obligation to § 1260.75 Reports. provided in § 1260.73(b), is the only the Federal Government. Unless NASA (a) The grant officer is responsible for means by which a grant may be takes title, equipment purchased with submitting the Individual Procurement transferred from one institution to grant funds vests in the recipient subject Action Report (NASA Form 507) for all another. When the principal investigator to § 1260.134. grant actions. changes organizational affiliation and (1) If NASA elects to take title to (b) The Committee on Academic desires support for the research at a new recipient acquired property, said Science and Engineering (CASE) Report location and novation is not used, a new decision will be subject to (NASA Form 1356), for research grants proposal must be submitted to NASA § 1260.132(b)(3). awarded to educational institutions, is via the appropriate officials of the new (2) Title to individual items or submitted with the basic award institution. Although such a proposal coherent systems (as defined in procurement request. In the case of will be reviewed in the normal manner, § 1260.74(f)) of recipient acquired certain non-funded actions for every effort will be made to expedite a equipment purchased at a cost of more educational institutions, the NF 1356 is decision. Regardless of the action taken than $5,000 may revert back to NASA at initiated by the grant officer. on the new proposal, final reports on NASA’s discretion, subject to the (c) The Federal Cash Transactions the original grant, describing the following conditions. Report (SF 272) shall be submitted by scientific progress and expenditure to (i) NASA shall notify the recipient in the recipient within 15 working days date, will be required. writing as part of the approval for following the end of each Federal fiscal (b) Novation and change of name. All retaining the item. If the item was quarter, as a condition of receiving novation agreements and change of requested as part of the original budget, advance payments. Instructions and name agreements of the recipient, prior the award must specify NASA’s answers to payment questions will be to execution, shall be reviewed by legal intention to take title. provided by the Financial Management counsel for legal sufficiency. When a (ii) Government titled property will be Office of the Center that issued the change in principal investigator from subject to the provisions for other grant. (see § 1260.152.) one institution to another occurs, Federally owned property as stated in (d) The annual Inventory Report of novation of the grant is preferable to § 1260.133. Federally Owned Property in Custody of termination. (3) Title to equipment costing $5,000 the Recipient will be submitted by the or less is not subject to transfer to the recipient by October 31, as required by § 1260.74 Property use, disposition, and agency, except under the conditions of § 1260.27(e). The listing shall include vesting of title. § 1260.74(f). information specified in § 1260.134(f) (a) Administrative grant officers shall (e) Title to Federally-owned property together with beginning and ending not approve the expenditure of grant remains with the Government. dollar value totals for the reporting funds for the acquisition of general (1) In accordance with Pub. L. 94–519, period. purpose equipment as defined by OMB NASA will not acquire property from (e) A Performance Report shall be Circulars A–21 and A–122 unless the other agencies for use on NASA grants. submitted in accordance with recipient’s justification for the (2) When Federally-owned property is §§ 1260.21 and 1260.151(d). Recipients equipment demonstrates that the reported excess by a recipient, the shall not be required to submit more equipment will be used exclusively for administrative grant officer will report than the original and two copies of research. the equipment to the Center property performance reports (§ 1260.151(e)). At (b) Property administration and plant disposal officer. the request of the technical officer, this clearance for all grants and cooperative (3) NASA policy encourages the requirement may be modified by use of agreements will be delegated to the donation of existing, excess NASA special condition § 1260.55 entitled appropriate DoD property property to nonprofit organizations ‘‘Reports Substitution’’. administration office. whose primary purpose is the conduct (f) Final reports are as follows. (c) Administrative grant officers will of scientific research. (1) A Summary of Research for provide copies of property related grant (f) When two or more components are research grants, an Education Activity documentation to the Center industrial fabricated into a single coherent system Report for education grants, or an property officer (prior to award or in such a way that the components lose Administrative Report for training modification) when the program office their separate identities, and their grants, shall be submitted as required by elects to retain title to an existing item separation would render the system § 1260.21 or § 1260.57. Citation of of Government property, to furnish the useless for its original purpose, the publications resulting from research, or property to the recipient in lieu of components will be considered as abstracts thereof, may serve as all or part donation or to take title to property integral parts of a single system. If such of the summary. A separate report is acquired by the recipient. When NASA a system includes recipient-owned required if inventions and patents 38070 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations resulted from the work. In addition, that makes withholding unnecessary. To (2) All certifications have been students are required to submit a release for payment the amount received; Student Evaluation Form to the withheld, grant officers shall send a (3) Payments have been made for administrative contact at the Center memorandum to their Financial allowable reimbursable costs and monitoring the work 90 days prior to the Management Office. refunds have been received for any ending date of a fellowship. balance of unobligated cash advanced § 1260.76 Suspension or termination. (2) A Final Inventory Report of that is not authorized to be retained for Federally Owned Property, including Suspension of termination of a grant use on other grants; and equipment where title was taken by the prior to the planned expiration date (4) A DD Form 1594 has been Government, shall be submitted by the must be reserved for exceptional provided by ONR to the NASA grant recipient no later than 60 days after the situations that cannot be handled any officer. end of the grant, as required by other way (see §§ 1260.23 and (e) Retention of documents. Records § 1260.27. 1260.160). Before suspending or will be retained in accordance with (3) A properly certified Final Federal terminating any grant with a university, § 1260.153. Cash Transactions Report, SF 272, is the NASA grant officer and technical required from the recipient for each officer shall take into account the Appendix to Subpart A to Part 1260Ð grant, as addressed in § 1260.26(a). consequences to graduate students Listing of Exhibits (g) One copy of each Disclosure of working under the grant. Exhibit A—Delegation of Administration Lobbying Activities (SF LLL), under 14 Exhibit B—Formats CFR 1271.110, shall be provided by the § 1260.77 Closeout procedures. grant officer to the Procurement Officer The closeout of a grant is the process Example 1—Research Grant Example 2—Cooperative Agreement for transmittal to the Director, Contract by which NASA determines that all applicable administrative actions and Example 3—Training Grant Management Division (Code HK). Example 4—Education Grant Suspected violations of the statutory all required work under the instrument Example 5—Grant or Cooperative Agreement prohibitions implemented by 14 CFR have been completed by both the with Foreign Organizations recipient and NASA and no further part 1271 shall be reported to Code HK. Exhibit C—Budget Summary (h) The Director, Program Operations action is necessary (see § 1260.171). Division (Code HS), shall provide to the (a) Initiation. The NASA grant officer Note: Exhibits are available at NASA shall determine from the technical Headquarters, Code HK, Washington, DC General Services Administration 20546. information concerning all NASA officer that work under a particular debarments, suspensions, grant will not be continued or is Subpart BÐUniform Administrative determinations of ineligibility, and completed. The NASA grant officer will Requirements for Grants and voluntary exclusions of persons in promptly notify ONR to begin closeout Cooperative Agreements with accordance with 14 CFR 1265.505. within 90 days of this determination. Institutions of Higher Education, (i) Remedies for Noncompliance are ONR will inform the recipient of Hospitals, and Other Non-Profit delineated in § 1260.162. pending closeout and the final Organizations (1) Failure of the recipient to provide documentation required, to the extent a required grant report can result in the practicable, prior to the grant’s General Agency and the public being denied expiration date. § 1260.101 Purpose. information about grant activities, (1) To expedite closeout, NASA grant NASA officials having less information officers shall respond to ONR inquiries This subpart implements OMB for making decisions, grant closeout within 30 days. The use of E-mail Circular No. A–110 and establishes being delayed, and confidence being communication between ONR and uniform administrative requirements for undermined as to whether the recipient NASA is encouraged. NASA grants and agreements awarded will meet the requirements under other (2) Recipients shall not be requested to institutions of higher education, grants. Because NASA grants provide to complete forms or supply information hospitals, and other non-profit for advance payments, a recipient could other than discussed in § 1260.75(c) organizations. NASA shall not impose be fully paid before final reports are through (f), except in unusual additional or inconsistent requirements, due. At this point, it is too late to situations. except as provided in §§ 1260.104 and withhold payment on the existing grant. (b) Reports submission. ONR will 1260.114 or unless specifically required (2) Consistent with §§ 1260.122(h) ensure that all reports required from the by Federal statute or executive order. and 1260.162(a), NASA does not recipient (see § 1260.75) have been Non-profit organizations that implement withhold payment until a recipient has received by the appropriate NASA Federal programs for the States are also failed to comply with report offices. subject to State requirements. (c) Reports certification. ONR will requirements for more than 90 days. To § 1260.102 Definitions. remedy failure to furnish reports, obtain from those that receive NASA special condition § 1260.56, reports, written certification that the (a) Accrued expenditures means the Withholding, should be used when reports have been satisfactorily charges incurred by the recipient during awarding a new grant or modifying an completed. The property certification a given period requiring the provision of existing grant with non-responsive should indicate that disposal of any funds for: organizations. remaining Government property has (1) Goods and other tangible property (i) Special condition § 1260.56 been made as directed and that NASA received; instructs the Financial Management has been compensated for any residual (2) Services performed by employees, Office to withhold payment pending inventory (see § 1260.135). In reviewing contractors, subcontractors, and other receipt of the satisfactorily completed the certifications, see §§ 1260.171 and payees; and, reports required in § 1260.75. 1260.172. (3) Other amounts becoming owed (ii) The grant officer may waive the (d) Administrativly complete. A grant under programs for which no current withholding requirement when the is administratively complete when services or performance is required. recipient has taken corrective action (1) All reports have been received; (b) Accrued income means the sum of: Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38071

(1) Earnings during a given period (k) Disallowed costs means those transactions during a given period that from services performed by the charges to an award that NASA require payment by the recipient during recipient, and goods and other tangible determines to be unallowable, in the same or a future period. property delivered to purchasers; and accordance with the applicable Federal (u) Outlays or expenditures means (2) Amounts becoming owed to the cost principles or other terms and charges made to the project or program. recipient for which no current services conditions contained in the award. They may be reported on a cash or or performance is required by the (l) Equipment means tangible accrual basis. For reports prepared on a recipient. nonexpendable personal property cash basis, outlays are the sum of cash (c) Acquisition cost of equipment including exempt property charged disbursements for direct charges for means the net invoice price of the directly to the award having a useful life goods and services, the amount of equipment, including the cost of of more than one year and an indirect expense charged, the value of modifications, attachments, accessories, acquisition cost of $5,000 or more per third party in-kind contributions or auxiliary apparatus necessary to unit. However, consistent with recipient applied and the amount of cash make the property usable for the policy, lower limits may be established. advances and payments made to purpose for which it was acquired. (m) Excess property means property subcontractors. For reports prepared on Other charges, such as the cost of under the control of any Federal an accrual basis, outlays are the sum of installation, transportation, taxes, duty awarding agency that, as determined by cash disbursements for direct charges or protective in-transit insurance, shall the head thereof, is no longer required for goods and services, the amount of be included or excluded from the unit for its needs or the discharge of its indirect expense incurred, the value of acquisition cost in accordance with the responsibilities. in-kind contributions applied, and the recipient’s regular accounting practices. (n) Exempt property means tangible net increase (or decrease) in the (d) Advance means a payment made personal property acquired in whole or amounts owed by the recipient for good by Treasury check or other appropriate in part with Federal funds, where a and other property received, for services payment mechanism to a recipient upon Federal awarding agency has statutory performed by employees, contractors, its request either before outlays are authority to vest title in the recipient subcontractors and other payees and made by the recipient or through the use without further obligation to the Federal other amounts becoming owed under of predetermined payment schedules. Government. An example of exempt programs for which no current services (e) Award means a grant or property authority is contained in the or performance are required. cooperative agreement that provides Federal Grant and Cooperative (v) Personal property means property support or stimulation to accomplish a Agreement Act (31 U.S.C. 6306), for of any kind except real property. It may public purpose. Awards include property acquired under an award to be tangible, having physical existence, research grants, training grants, facilities conduct basic or applied research by a or intangible, having no physical grants, educational grants, and non-profit institution of higher existence, such as copyrights, patents, cooperative agreements in the form of education or non-profit organization or securities. money or property in lieu of money, by whose principal purpose is conducting (w) Prior approval means written NASA to an eligible recipient. The term scientific research. approval by an authorized official (o) NASA means the National does not include: technical assistance, evidencing prior consent. Aeronautics and Space Administration which provides services instead of (x) Program income means gross (NASA), including its authorized money; other assistance in the form of income earned by the recipient that is representatives. loans, loan guarantees, interest (p) Federal funds authorized means directly generated by a supported subsidies, or insurance; direct payments the total amount of Federal funds activity or earned as a result of the of any kind of individuals; and, obligated by the Federal Government for award (see exclusions in § 1270.24(e) contracts which are required to be use by the recipient. This amount may and (h). Program income includes, but entered into and administered under include any authorized carryover of is not limited to, income from fees for procurement laws and regulations. unobligated funds from prior funding services performed, the use or rental of (f) Cash contributions means the periods when permitted by agency real or personal property acquired under recipient’s cash outlay, including the regulations or agency implementing federally-funded projects, the sale of outlay of money contributed to the instructions. commodities or items fabricated under recipient by third parties. (q) Federal share of real property, an award, license fees and royalties on (g) Closeout means the process by equipment, or supplies means that patents and copyrights, and interest on which NASA determines that all percentage of the property’s acquisition loans made with award funds. Interest applicable administrative actions and costs and any improvement earned on advances of NASA funds is all required work of the award have expenditures paid with Federal funds. not program income. Except as been completed by the recipient and (r) Funding period means the period otherwise provided in these regulations NASA. of time when NASA funding is available or the terms and conditions of the (h) Contract means a procurement for obligation by the recipient. award, program income does not contract under an award, and a (s) Intangible property and debt include the receipt of principal on procurement subcontract under a instruments means, but is not limited to, loans, rebates, credits, discounts, etc., or recipient’s contract. trademarks, copyrights, patents and interest earned on any of them. (i) Cost sharing or matching means patent applications and such property (y) Project costs means all allowable that portion of project or program costs as loans, notes and other debt costs, as set forth in the applicable not borne by NASA. instruments, lease agreements, stock Federal cost principles, incurred by a (j) Date of completion means the date and other instruments of property recipient and the value of the on which all work under an award is ownership, whether considered tangible contributions made by third parties in completed or the date on the award or intangible. accomplishing the objectives of the document, or any supplement or (t) Obligations mean the amounts of award during the project period. amendment thereto, on which NASA orders placed, contracts and grants (z) Project period means the period sponsorship ends. awarded, services received and similar established in the award document 38072 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations during which NASA sponsorship begins even if the agreement is called a awarded and the amount which could and ends. contract, but does not include have been awarded under the recipient’s (aa) Property means, unless otherwise procurement of goods and services nor approved negotiated indirect cost rate. stated, real property, equipment, does it include any form of assistance (oo) Working capital advance means a intellectual property and debt which is excluded from the definition of procedure whereby funds are advanced instruments. ‘‘award’’ in paragraph (e) of this section. to the recipient to cover its estimated (bb) Real property means land, (gg) Subrecipient means the legal disbursement needs for a given initial including land improvements, entity to which a subaward is made and period. structures and appurtenances thereto, which is accountable to the recipient for but excludes movable machinery and the use of the funds provided. The term § 1260.103 Effect on other issuances. equipment. may include foreign or international For awards subject to this subpart, all (cc) Recipient means an organization organizations (such as agencies of the administrative requirements of codified receiving an award directly from NASA United Nations). program regulations, program manuals, to carry out a project or program. The (hh) Supplies means all personal handbooks and other nonregulatory term includes public and private property excluding equipment, materials which are inconsistent with institutions of higher education, public intellectual property, and debt the requirements of this subpart shall be and private hospitals, and other quasi- instruments as defined in this section, superseded, except to the extent they public and private non-profit and inventions of a contractor are required by statute, or authorized in organizations such as, but not limited conceived or first actually reduced to accordance with the deviations to, community action agencies, research practice in the performance of work provision in § 1260.104. institutes, educational associations, and under a funding agreement (‘‘subject health centers. The term may include inventions’’), as defined in 37 CFR part § 1260.104 Deviations. commercial organizations, foreign or 401, ‘‘Rights to Inventions Made by The Office of Management and Budget international organizations (such as Nonprofit Organizations and Small (OMB) may grant exceptions for classes agencies of the United Nations) which Business Firms Under Government of grants or recipients subject to the are recipients, subcontractors, or Grants, Contracts, and Cooperative requirements of this subpart when contractors or subcontractors of Agreements.’’ exceptions are not prohibited by statute. recipients. The term does not include (ii) Suspension means an action by However, in the interest of maximum government-owned contractor-operated NASA that temporarily withdraws uniformity, exceptions from the facilities or research centers providing NASA sponsorship under an award, requirements of this subpart shall be continued support for mission-oriented, pending corrective action by the permitted only in unusual large-scale programs that are recipient or pending a decision to circumstances. NASA may apply more government-owned or controlled, or are terminate the award by NASA. restrictive requirements to a class of designated as federally-funded research Suspension of an award is a separate recipients when approved by OMB. and development centers. action from suspension under Federal NASA may apply less restrictive (dd) Research and development agency regulations implementing requirements when awarding small means all research activities, both basic Executive Orders 12549 and 12689, awards, except for those requirements and applied, and all development ‘‘Debarment and Suspension.’’ which are statutory. Exceptions on a activities that are supported at (jj) Termination means the case-by-case basis may also be made by universities, colleges, and other cancellation of Federal sponsorship, in NASA. See § 1260.6(c). nonprofit institutions. Research is whole or in part, under an agreement at § 1260.105 Subawards. defined as a systematic study directed any time prior to the date of completion. toward fuller scientific knowledge or (kk) Third party in-kind contributions Unless sections of this subpart understanding of the subject studied. means the value of non-cash specifically exclude subrecipients from Development is the systematic use of contributions provided by non-Federal coverage, the provisions of this subpart knowledge and understanding gained third parties. Third party in-kind shall be applied to subrecipients from research directed toward the contributions may be in the form of real performing work under awards if such production of useful materials, devices, property, equipment, supplies and other subrecipients are institutions of higher systems, or methods, including design expendable property, and the value of education, hospitals or other non-profit and development of prototypes and goods and services directly benefiting organizations. State and local processes. The term research also and specifically identifiable to the government subrecipients are subject to included activities involving the project or program. the provisions of 14 CFR part 1273, training of individuals in research (ll) Unliquidated obligations, for ‘‘Uniform Administrative Requirements techniques where such activities utilize financial reports prepared on a cash for Grants and Cooperative Agreements the same facilities as other research and basis, means the amount of obligations to State and Local Governments.’’ development activities and where such incurred by the recipient that have not Pre—Award Requirements activities are not included in the been paid. For reports prepared on an instruction function. accrued expenditure basis, they § 1260.110 Purpose. (ee) Small awards means a grant or represent the amount of obligations Sections 1260.111 through 1260.117 cooperative agreement not exceeding incurred by the recipient for which an prescribe forms and instructions and the small purchase threshold. outlay has not been recorded. other pre-award matters to be used in (ff) Subaward means an award of (mm) Unobligated balance means the applying for NASA awards. financial assistance in the form of portion of the funds authorized by money, or property in lieu of money, NASA that has not been obligated by the § 1260.111 Pre-award policies. made under an award by a recipient to recipient and is determined by (a) Use of grants and cooperative an eligible subrecipient or by a deducting the cumulative obligations agreements, and contracts. In each subrecipient to a lower tier subrecipient. from the cumulative funds authorized. instance, NASA shall decide on the The term includes financial assistance (nn) Unrecovered indirect cost means appropriate award instrument (i.e., when provided by any legal agreement, the difference between the amount grant, cooperative agreement, or Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38073 contract). The Federal Grant and additional requirements as needed. regulation on an annual basis, if the Cooperative Agreement Act (31 U.S.C. Such applicant or recipient will be recipients have ongoing and continuing 6301–08) governs the use of grants, notified in writing as to the nature of the relationships with the agency. Annual cooperative agreements and contracts. A additional requirements, the reason why certifications and representations shall grant or cooperative agreement shall be the additional requirements are being be signed by responsible officials with used only when the principal purpose imposed, the nature of the corrective the authority to ensure recipient’s of a transaction is to accomplish a action needed, the time allowed for compliance with the pertinent public purpose of support or completing the corrective actions, and requirements. stimulation authorized by Federal the method for requesting Post Award Requirements statute. The statutory criterion for reconsideration of the additional choosing between grants and requirements imposed. Any special Financial and Program Management cooperative agreements is that for the conditions shall be promptly removed latter, ‘‘substantial involvement is once the conditions that prompted them § 1260.120 Purpose of financial and program management. expected between the executive agency have been corrected. and the State, local government, or other Sections 1260.121 through 1260.128 recipient when carrying out the activity § 1260.115 Metric system of measurement. prescribe standards for financial contemplated in the agreement.’’ The Metric Conversion Act, as management systems, methods for Contracts shall be used when the amended by the Omnibus Trade and making payments and rules for: principal purpose is acquisition of Competitiveness Act (15 U.S.C. 205) satisfying cost sharing and matching property or services for the direct declares that the metric system is the requirements, accounting for program benefit or use of the Federal preferred measurement system for U.S. income, budget revision approvals, Government. trade and commerce. The Act requires making audits, determining allowability (b) Public Notice and Priority Setting. each Federal agency to establish a date of cost, and establishing fund NASA shall notify the public of its or dates in consultation with the availability. Secretary of Commerce, when the metric intended funding priorities for § 1260.121 Standards for financial discretionary grant programs, unless system of measurement will be used in management systems. the agency’s procurements, grants, and funding priorities are established by (a) Recipients shall relate financial other business-related activities. Metric Federal statute. data to performance data and develop implementation may take longer where unit cost information whenever § 1260.112 Forms for applying for Federal the use of the system is initially practical. For awards that support assistance. impractical or likely to cause significant research, it should be noted that it is (a) NASA shall comply with the inefficiencies in the accomplishment of generally not appropriate to develop applicable report clearance federally-funded activities. NASA shall unit cost information. requirements of 5 CFR part 1320, follow the provisions of Executive Order (b) Recipients’ financial management ‘‘Controlling Paperwork Burdens on the 12770, ‘‘Metric Usage in Federal systems shall provide for the following. Public,’’ with regard to all forms used by Government Programs.’’ the NASA in place of or as a (1) Accurate, current and complete supplement to the Standard Form 424 § 1260.116 Resource Conservation and disclosure of the financial results of (SF–424) series. Recovery Act (RCRA). each federally-sponsored project or (b) Applicants shall use those forms Under the RCRA (Pub. L. 94–580 program in accordance with the and instructions prescribed by NASA in codified at 42 U.S.C. 6962), any State reporting requirements set forth in § 1260. agency or agency of a political § 1260.152. If NASA requires reporting subdivision of a State which is using on an accrual basis from a recipient that § 1260.113 Debarment and suspension. appropriated Federal funds must maintains its records on other than an NASA and recipients shall comply comply with Section 6002 of the RCRA accrual basis, the recipient shall not be with the nonprocurement debarment (42 U.S.C. 6962). Section 6002 requires required to establish an accrual and suspension rule, 14 CFR part 1265, that preference be given in procurement accounting system. These recipients ‘‘Governmentwide Debarment and programs to the purchase of specific may develop such accrual data for its Suspension (Nonprocurement) and products containing recycled materials reports on the basis of an analysis of the Governmentwide Requirements for identified in guidelines developed by documentation on hand. Drug-Free Workplace (Grants),’’ the Environmental Protection Agency (2) Records that identify adequately implementing Executive Orders 12549 (EPA) (40 CFR parts 247–254). the source and application of funds for and 12689, ‘‘Debarment and Accordingly, State and local institutions federally-sponsored activities. These Suspension.’’ This rule restricts of higher education, hospitals, and non- records shall contain information contracts with certain parties that are profit organizations that receive direct pertaining to Federal awards, debarred, suspended or otherwise Federal awards or other Federal funds authorizations, obligations, unobligated excluded from or ineligible for shall give preference in their balances, assets, outlays, income and participation in Federal assistance procurement programs funded with interest. programs or activities. Federal funds to the purchase of (3) Effective control over and recycled products pursuant to the EPA accountability for all funds, property § 1260.114 Special award conditions. guidelines. and other assets. Recipients shall If an applicant or recipient has a adequately safeguard all such assets and history of poor performance, is not § 1260.117 Certifications and assure they are used solely for financially stable, has a management representations. authorized purposes. system that does not meet the standards Unless prohibited by statute or (4) Comparison of outlays with budget prescribed in this subpart, has not codified regulation, NASA will allow amounts for each award. Whenever conformed to the terms and conditions recipients to submit certain appropriate, financial information of a previous award, or is not otherwise certifications and representations should be related to performance and responsible, NASA may impose required by statute, executive order, or unit cost data. 38074 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

(5) Written procedures to minimize (ii) Financial management systems (h) Unless otherwise required by the time elapsing between the transfer of that meet the standards for fund control statute, NASA will not withhold funds to the recipient from the U.S. and accountability as established in payments for proper charges made by Treasury and the issuance or § 1260.121. recipients at any time during the project redemption of checks, warrants or (2) Cash advances to a recipient period unless the conditions in payments by other means for program organization shall be limited to the paragraph (h) (1) or (2) of this section purposes by the recipient. To the extent minimum amounts needed and be timed apply. that the provisions of the Cash to be in accordance with the actual, (1) A recipient has failed to comply Management Improvement Act (CMIA) immediate cash requirements of the with the project objectives, the terms (Pub. L. 101–453) govern, payment recipient organization in carrying out and conditions of the award, or NASA methods of State agencies, the purpose of the approved program or reporting requirements. instrumentalities, and fiscal agents shall project. The timing and amount of cash (2) The recipient is delinquent in a be consistent with CMIA Treasury-State advances shall be as close as is debt to the United States as defined in Agreements or the CMIA default administratively feasible to the actual OMB Circular A–129, ‘‘Managing procedures codified at 31 CFR part 205, disbursements by the recipient Federal Credit Programs.’’ Under such ‘‘Withdrawal of Cash from the Treasury organization for direct program or conditions, NASA may, upon for Advances under Federal Grant and project costs and the proportionate reasonable notice, inform the recipient Other Programs.’’ share of any allowable indirect costs. that payments shall not be made for (6) Written procedures for (c) Whenever possible, advances shall obligations incurred after a specified determining the reasonableness, be consolidated to cover anticipated date until the conditions are corrected allocability and allowability of costs in cash needs for all awards made by or the indebtedness to the Federal accordance with the provisions of the NASA to the recipient. Government is liquidated. applicable Federal cost principles and (1) Advance payments will be made (i) Standards governing the use of the terms and conditions of the award. by electronic funds transfer. banks and other institutions as (7) Accounting records including cost (2) Advance payment mechanisms are depositories of funds advanced under accounting records that are supported subject to 31 CFR part 205. awards are as follows. by source documentation. (d) [Reserved. Not used by NASA.] (1) Except for situations described in (c) Where the Federal Government (e) Reimbursement is the preferred paragraph (i)(2) of this section, NASA guarantees or insures the repayment of method when the requirements in shall not require separate depository money borrowed by the recipient, paragraph (b) of this section cannot be accounts for funds provided to a NASA, at its discretion, may require met. NASA may also use this method on recipient or establish any eligibility adequate bonding and insurance if the any construction agreement, or if the requirements for depositories for funds bonding and insurance requirements of major portion of the construction project provided to a recipient. However, the recipient are not deemed adequate is accomplished through private market recipients must be able to account for to protect the interest of the Federal financing or Federal loans, and the the receipt, obligation and expenditure Government. Federal assistance constitutes a minor of funds. (d) NASA may require adequate portion of the project. When the (2) Advances of Federal funds shall be fidelity bond coverage where the reimbursement method is used, NASA deposited and maintained in insured recipient lacks sufficient coverage to shall make payment within 30 days after accounts whenever possible. protect the Federal Government’s receipt of the billing, unless the billing (j) Consistent with the national goal of interest. is improper. expanding the opportunities for women- (e) Where bonds are required in the (f) If a recipient cannot meet the owned and minority-owned business situations described above, the bonds criteria for advance payments and enterprises, recipients shall be shall be obtained from companies NASA has determined that encouraged to use women-owned and holding certificates of authority as reimbursement is not feasible because minority-owned banks (a bank which is acceptable sureties, as prescribed in 31 the recipient lacks sufficient working owned at least 50 percent by women or CFR part 223, ‘‘Surety Companies Doing capital, NASA may provide cash on a minority group members). Business with the Unites States.’’ working capital advance basis. Under (k) Recipients shall maintain this procedure, NASA shall advance advances of Federal funds in interest § 1260.122 Payment. cash to the recipient to cover its bearing accounts, unless the conditions (a) Payment methods shall minimize estimated disbursement needs for an in paragraph (k) (1), (2) or (3) of this the time elapsing between the transfer of initial period generally geared to the section apply. funds from the United States Treasury awardee’s disbursing cycle. Thereafter, (1) The recipient receives less than and the issuance or redemption of NASA shall reimburse the recipient for $120,000 in Federal awards per year. checks, warrants, or payment by other its actual cash disbursements. The (2) The best reasonable available means by the recipients. Payment working capital advance method of interest bearing account would not be methods of State agencies or payment shall not be used for recipients expected to earn interest in excess of instrumentalities shall be consistent unwilling or unable to provide timely $250 per year on Federal cash balances. with Treasury-State CMIA agreements advances to their subcontractor to meet (3) The depository would require an or default procedures codified at 31 CFR the subcontractor’s actual cash average or minimum balance so high part 205. disbursements. that it would not be feasible within the (b)(1) Recipients are to be paid in (g) To the extent available, recipients expected Federal and non-Federal cash advance, provided they maintain or shall disburse funds available from resources. demonstrate the willingness to repayments to and interest earned on a (l) Interest earned on Federal maintain: revolving fund, program income, advances deposited in interest-bearing (i) Written procedures that minimize rebates, refunds, contract settlements, accounts in excess of $250 per year shall the time elapsing between the transfer of audit recoveries and interest earned on be remitted annually to Department of funds and disbursement by the such funds before requesting additional Health and Human Services (DHHS), recipient; and cash payments. Payment Management System, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38075

Rockville, MD 20852. Interest amounts shall be the lesser of paragraph (c) (1) or However, the full value of equipment or up to $250 per year may be retained by (2) of this section. other capital assets and fair rental the recipient for administrative expense. (1) The certified value of the charges for land may be allowed, In accordance with 31 CFR part 206, remaining life of the property recorded provided that NASA has approved the interest should be remitted in the recipient’s accounting records at charges. electronically through the Automated the time of donation. (h) The value of donated property Clearing House (ACT) to DHHS. (2) The current fair market value. shall be determined in accordance with Recipients without this capability may However, when there is sufficient the usual accounting policies of the make the remittance by check. In either justification, NASA may approve the recipient, with the following case, the remittance should be payable use of the current fair market value of qualifications. to DHHS and should indicate the the donated property, even if it exceeds (1) The value of donated land and recipient’s Entity Identification Number the certified value at the time of buildings shall not exceed its fair (EIN) and reason, i.e., ‘‘Interest earned.’’ donation to the project. market value at the time of donation to (m) Except as noted elsewhere in this (d) Volunteer services furnished by the recipient as established by an subpart, only the following forms shall professional and technical personnel, independent appraiser (e.g., certified be authorized for the recipients in consultants, and other skilled and real property appraiser or General requesting advances and unskilled labor may be counted as cost Services Administration representative) reimbursements. Federal agencies shall sharing or matching if the service is an and certified by a responsible official of not require more than an original and integral and necessary part of an the recipient. two copies of these forms. approved project or program. Rates for (2) The value of donated equipment (1) SF–270, Request for Advance or volunteer services shall be consistent shall not exceed the fair market value of Reimbursement. [Reserved. Not used by with those paid for similar work in the equipment of the same age and NASA.] recipient’s organization. In those condition at the time of donation. (2) SF–271, Outlay Report and instances in which the required skills (3) The value of donated space shall Request for Reimbursement for are not found in the recipient not exceed the fair rental value of Construction Programs. The SF–271 organization, rates shall be consistent comparable space as established by an may be used for requesting with those paid for similar work in the independent appraisal of comparable reimbursement for NASA construction labor market in which the recipient space and facilities in a privately-owned programs. competes for the kind of services building in the same locality. involved. In either case, paid fringe (4) The value of loaned equipment § 1260.123 Cost sharing or matching. benefits that are reasonable, allowable, shall not exceed its fair rental value. (a) All contributions, including cash and allocable may be included in the (5) The following requirements and third party in-kind, shall be valuation. pertain to the recipient’s supporting accepted as part of the recipient’s cost (e) When an employer other than the records for in-kind contributions from sharing or matching when such recipient furnishes the services of an third parties. contributions meet all of the following employee, these services shall be valued (i) Volunteer services shall be documented and, to the extent feasible, criteria. at the employee’s regular rate of pay (1) Are verifiable from the recipient’s (plus an amount of fringe benefits that supported by the same methods used by records. are reasonable, allowable, and allocable, the recipient for its own employees. (ii) The basis for determining the (2) Are not included as contributions but exclusive of overhead costs), valuation for personal service, material, for any other federally-assisted project provided these services are in the same equipment, buildings and land shall be or program. skill for which the employee is normally documented. (3) Are necessary and reasonable for paid. proper and efficient accomplishment of (f) Donated supplies may include § 1260.124 Program income. project or program objectives. such items as expendable equipment, (a) The standards set forth in this (4) Are allowable under the applicable office supplies, laboratory supplies or section shall be used to account for cost principles. workshop and classroom supplies. program income related to projects (5) Are not paid by the Federal Value assessed to donated supplies financed in whole or in part with Government under another award, included in the cost sharing or matching Federal funds. except where authorized by Federal share shall be reasonable and shall not (b) Except as provided in paragraph statute to be used for cost sharing or exceed the fair market value of the (h) of this section, program income matching. property at the time of the donation. earned during the project period shall (6) Are provided for in the approved (g) The method used for determining be retained by the recipient and, in budget when required by NASA. cost sharing or matching for donated accordance with the terms and (7) Conform to other provisions of this equipment, buildings and land for conditions of the award, shall be used subpart, as applicable. which title passes to the recipient may in one or more of the ways listed in the (b) Unrecovered indirect costs may be differ according to the purpose of the following. included as part of cost sharing or award, if the conditions in paragraph (g) (1) Added to funds committed to the matching only with the prior approval (1) or (2) of this section apply. project by NASA and recipient and used of NASA. (1) If the purpose of the award is to to further eligible project or program (c) Values for recipient contributions assist the recipient in the acquisition of objectives. of services and property shall be equipment, buildings or land, the total (2) Used to finance the non-Federal established in accordance with the value of the donated property may be share of the project or program. applicable cost principles. If NASA claimed as cost sharing or matching. (3) Deducted from the total project or authorizes recipients to donate (2) If the purpose of the award is to program allowable cost in determining buildings or land for construction/ support activities that require the use of the net allowable costs on which the facilities acquisition projects or long- equipment, buildings or land, normally Federal share of costs is based. term use, the value of the donated only depreciation or use charges for (c) When NASA authorizes the property for cost sharing or matching equipment and buildings may be made. disposition of program income as 38076 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations described in paragraphs (b)(1) or (b)(2) from NASA for one or more of the to 12 months unless one or more of the of this section, program income in following program or budget related following conditions apply. For one- excess of any limits stipulated shall be reasons. time extensions, the recipient must used in accordance with paragraph (1) Change in the scope or the notify NASA in writing with the (b)(3) of this section. objective of the project or program (even supporting reasons and revised (d) In the event that the program if there is no associated budget revision expiration date at least 10 days before regulations or the terms and conditions requiring prior written approval). the expiration date specified in the of the award do not specify how (2) Change in a key person specified award. This one-time extension may not program income is to be used, paragraph in the application or award document. be exercised merely for the purpose of (b)(3) of this section shall apply (3) The absence for more than three using unobligated balances. automatically to all projects or programs months, or a 25 percent reduction in (i) The terms and conditions of award except research. For awards that support time devoted to the project, by the prohibit the extension. research, paragraph (b)(1) shall apply approved project director or principal (ii) The extension requires additional automatically unless the awarding investigator. Federal funds. agency indicates in the terms and (4) The need for additional Federal (iii) The extension involves any conditions another alternative on the funding. change in the approved objectives or award or the recipient is subject to (5) The transfer of amounts budgeted scope of the project. special award conditions, as indicated for indirect costs to absorb increases in (3) Carry forward unobligated in § 1260.114. direct costs, or vice versa, if approval is balances to subsequent funding periods. (e) Unless program regulations or the required by NASA. (4) For awards that support research, (6) The inclusion, unless waived by terms and conditions of the award unless NASA provides otherwise in the NASA, of costs that require prior provide otherwise, recipients shall have award or in the agency’s regulations, the approval in accordance with OMB no obligation to the Federal Government prior approval requirements described Circular A–21, ‘‘Cost Principles for regarding program income earned after in paragraph (e) of this section are Institutions of Higher Education;’’ OMB the end of the project period. automatically waived (i.e., recipients Circular A–122, ‘‘Cost Principles for (f) Unless program regulations or the need not obtain such prior approvals) Non-Profit Organizations;’’ 45 CFR part terms and conditions of the award unless one of the conditions included in 74 Appendix E, ‘‘Principles for provide otherwise, costs incident to the paragraph (e)(2) of this section applies. Determining Costs Applicable to generation of program income may be (f) Program regulations may restrict Research and Development under deducted from gross income to the transfer of funds among direct cost Grants and Contracts with Hospitals;’’ or determine program income, provided categories or programs, functions and 48 CFR part 31, ‘‘Contract Cost these costs have not been charged to the activities for awards in which NASA’s Principles and Procedures,’’ as award. share of the project exceeds $100,000 (g) Proceeds from the sale of property applicable. (7) The transfer of funds allotted for and the cumulative amount of such shall be handled in accordance with the transfers exceeds or is expected to requirements of the Property Standards training allowances (direct payment to trainees) to other categories of expense. exceed 10 percent of the total budget as (See §§ 1260.130 through 1260.137). last approved by NASA. However, no (h) Unless program regulations or the (8) Unless described in the application and funded in the approved program regulation shall permit a terms and condition of the award transfer that would cause any Federal provide otherwise, recipients shall have awards, the subaward, transfer or contracting out of any work under an appropriation or part thereof to be used no obligation to the Federal Government for purposes other than those consistent with respect to program income earned award. This provision does not apply to the purchase of supplies, material, with the original intent of the from license fees and royalties for appropriation. copyrighted material, patents, patent equipment or general support services. (g) All other changes to applications, trademarks, and (d) No other prior approval nonconstruction budgets, except for the inventions produced under an award. requirements for specific items may be changes described in paragraph (j), do However, Patent and Trademark imposed unless a deviation has been not require prior approval. Amendments (35 U.S.C. 18) apply to approved by OMB. (h) For construction awards, inventions made under an experimental, (e) Except for requirements listed in recipients shall request prior written developmental, or research award. paragraphs (c)(1) and (c)(4) of this section, NASA is authorized, at its approval promptly from NASA for § 1260.125 Revision of budget and option, to waive cost-related and budget revisions whenever the program plans. administrative prior written approvals conditions in paragraphs (h)(1), (2) or (a) The budget plan is the financial required by this Part and OMB Circulars (3) or this section apply. expression of the project or program as A–21 and A–122. Such waivers may (1) The revision results from changes approved during the award process. It include authorizing recipients to do any in the scope or the objective of the may include either the Federal and non- one or more of the following. project or program. Federal share, or only the Federal share, (1) Incur pre-award costs 90 calendar (2) The need arises for additional depending upon requirements in these days prior to award or more than 90 Federal funds to complete the project. regulations. It shall be related to calendar days with the prior approval of (3) A revision is desired which performance for program evaluation NASA. All pre-award costs are incurred involves specific costs for which prior purposes whenever appropriate. at the recipient’s risk (i.e., NASA is written approval requirements may be (b) Recipients are required to report under no obligation to reimburse such imposed consistent with applicable deviations from budget and program costs if for any reason the recipient does OMB cost principles listed in plans, and request prior approvals for not receive an award or if the award is § 1260.127. budget and program plan revisions, in less than anticipate and inadequate to (i) No other prior approval accordance with this section. cover such costs). requirements for specific items may be (c) For nonconstruction awards, (2) Initiated a non-time extension of imposed unless a deviation has been recipients shall request prior approvals the expiration date of the award of up approved by OMB. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38077

(j) When NASA makes an award that accordance with the provisions of OMB (a) Title to real property shall vest in provides support for both construction Circular A–87, ‘‘Cost Principles for State the recipient subject to the condition and nonconstruction work, NASA may and Local Governments.’’ The that the recipient shall use the real require the recipient to request prior allowability of costs incurred by non- property for the authorized purpose of approval from NASA before making any profit organizations is determined in the project as long as it is needed and fund or budget transfers between the accordance with the provisions of OMB shall not encumber the property without two types of work supported. Circular A–122, ‘‘Cost Principles for approval of NASA. (k) For both construction and Non-Profit Organizations.’’ The (b) The recipient shall obtain written nonconstruction awards, NASA shall allowability of costs incurred by approval by NASA for the use of real require recipients to notify NASA in institutions of higher education is property in other federally-sponsored writing promptly whenever the amount determined in accordance with the projects when the recipient determines of Federal authorized funds is expected provisions of OMB Circular A–21, ‘‘Cost that the property is no longer needed for to exceed the needs of the recipient for Principles for Educational Institutions.’’ the purpose of the original project. Use the project period by more than $5,000 The allowability of costs incurred by in other projects shall be limited to or five percent of the Federal award, hospitals is determined in accordance those under federally-sponsored whichever is greater. This notification with the provisions of Appendix E of 45 projects (i.e., awards) or programs that shall not be required if an application CFR part 74, ‘‘Principles for have purposes consistent with those for additional funding is submitted for Determining Costs Applicable to authorized for support by NASA. a continuation award. Research and Development Under (c) When the real property is no (l) When requesting approval for Grants and Contracts with Hospitals.’’ longer needed as provided in paragraph budget revisions, recipients shall use The allowability of costs incurred by (a) and (b), the recipient shall request the budget forms that were used in the commercial organizations and those disposition instructions from NASA or application unless NASA indicates a non-profit organizations listed in its successor Federal awarding agency. letter of request suffices. Attachment C to Circular A–122 is NASA shall observe one or more of the (m) Within 30 calendar days from the determined in accordance with the following disposition instructions. date of receipt of the request for budget provisions of the Federal Acquisition (1) The recipient may be permitted to revisions, NASA shall review the Regulation (FAR) at 48 CFR part 31. retain title without further obligation to request and notify the recipient whether § 1260.128 Period of availability of funds. the Federal Government after it the budget revisions have been compensates the Federal Government approved. If the revision is still under Where a funding period is specified, a recipient may charge to the grant only for the percentage of the current fair consideration at the end of 30 calendar market value of the property attributable days, NASA shall inform the recipient allowable costs resulting from obligations incurred during the funding to the Federal participation in the in writing of the date when the recipient project. may expect the decision. period and any pre-award costs authorized by NASA. (2) The recipient may be directed to § 1260.126 Non-Federal audits. sell the property under guidelines Property Standards (a) Recipients that are institutions of provided by NASA and pay the Federal higher education or other non-profit § 1260.130 Purpose of property standards. Government for that percentage of the current fair market value of the property organizations shall be subject to the Sections 1260.131 through 1260.137 attributable to the Federal participation audit requirements contained in OMB set forth uniform standards governing in the project (after deducting actual Circular A–133, ‘‘Audits of Institutions management and disposition of property and reasonable selling and fix-up of Higher Education and Other Non- furnished by the Federal Government expenses, if any, from the sales Profit Institutions.’’ whose cost was charged to a project proceeds). When the recipient is (b) State and local governments shall supported by a Federal award. authorized or required to sell the be subject to the audit requirements Recipients shall observe these standards property, proper sales procedures shall contained in the Single Audit Act (31 under awards and NASA will not be established that provide for U.S.C. 7501–7) and NASA regulations impose additional requirements, unless competition to the extent practicable implementing OMB Circular A–128, specifically required by Federal statue. and result in the highest possible return. ‘‘Audits of State and Local The recipient may use its own property Governments.’’ management standards and procedures (3) The recipient may be directed to (c) Hospitals not covered by the audit provided it observes the provisions of transfer title to the property to the provisions of OMB Circular A–133 shall §§ 1260.131 through 1260.137. Federal Government or to an eligible be subject to the audit requirements of third party provided that, in such cases, NASA. § 1260.131 Insurance coverage. the recipient shall be entitled to (d) Commercial organizations shall be Recipients shall, at a minimum, compensation for its attributable subject to the audit requirements of provide the equivalent insurance percentage of the current fair market NASA or the prime recipient as coverage for real property and value of the property. incorporated into the award document. equipment acquired with Federal funds § 1260.133 Federally-owned and exempt as provided for property owned by the § 1260.127 Allowable costs. property. recipient. Federally-owned property For each kind of recipient, there is a need not be insured unless required by (a) Federally-owned property. (1) Title set of Federal principles for determining the terms and conditions of the award. to federally-owned property remains allowable costs. Allowability of costs vested in the Federal Government. shall be determined in accordance with § 1260.132 Real property. Recipients shall submit annually an the cost principles applicable to the Unless otherwise provided by statue, inventory listing of federally-owned entity incurring the costs. Thus, the requirements concerning the use property in their custody to NASA. allowability of costs incurred by State, and disposition of real property Upon completion of the award or when local or federally-recognized Indian acquired in whole or in part under the property is no longer needed, the tribal governments is determined in awards are as follows: recipient shall report the property to 38078 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

NASA for further Federal agency preference for such other use shall be (4) A control system shall be in effect utilization. given to other projects or programs to insure adequate safeguards to prevent (2) If NASA has no further need for sponsored by NASA; second preference loss, damage, or theft of the equipment. the property, it shall be declared excess shall be given to projects or programs Any loss, damage, or theft of equipment and reported to the General Services sponsored by other Federal agencies. If shall be investigated and fully Admiration, unless NASA has statutory the equipment is owned by the Federal documented; if the equipment was authority to dispose of the property by Government, use on other activities not owned by the Federal Government, the alternative methods (e.g, the authority sponsored by the Federal Government recipient shall promptly notify NASA. provided by the Federal Technology shall be permissible if authorized by (5) Adequate maintenance procedures Transfer Act (15 U.S.C. 3710 (I)) to NASA. User charges shall be treated as shall be implemented to keep the donate research equipment to program income. equipment in good condition. educational and non-profit (e) When acquiring replacement (6) Where the recipient is authorized organizations in accordance with E.O. equipment, the recipient may use the or required to sell the equipment, 12821, ‘‘Improving Mathematics and equipment to be replaced as trade-in or proper sales procedures shall be Science Education in Support of the sell the equipment and use the proceeds established which provide for National Education Goals.’’) to offset the costs of the replacement competition to the extent practicable Appropriate instructions shall be issued equipment subject to the approval of and result in the highest possible return. to the recipient by NASA. NASA. (g) When the recipient no longer (b) Exempt property. Title to (f) The recipients’s property needs the equipment, the equipment nonexpendable personal property management standards for equipment may be used for other activities in accordance with the following acquired with grant funds shall be acquired with Federal funds and standards. For equipment with a current vested in the recipient upon acquisition, federally-owned equipment shall per unit fair market value of $5,000 or unless it is determined that to do so is include all of the following. more, the recipient may retain the not in furtherance of the objectives of (1) Equipment records shall be equipment for other uses provided that NASA. When title is vested in the maintained accurately and shall include compensation is made to the original recipient, the recipient shall have no the following information. Federal awarding agency or its other obligation or accountability to the (i) A description of the equipment. Federal Government for its use or successor. The amount of compensation (ii) Manufacturer’s serial number, shall be computed by applying the disposition, except as provided in model number, Federal stock number, § 1260.27. percentage of Federal participation in national stock number, or other the cost of the original project or § 1260.134 Equipment. identification number. program to the current fair market value (a) Title to equipment acquired by a (iii) Source of the equipment, of the equipment. If the recipient has no recipient with Federal funds shall vest including the award number. need for the equipment, the recipient in the recipient, subject to conditions of (iv) Whether title vests in the shall request disposition instructions this section. recipient or the Federal Government. from NASA. NASA shall determine (b) The recipient shall not use (v) Acquisition date (or date received, whether the equipment can be used to equipment acquired with Federal funds if the equipment was furnished by the meet NASA’s requirements. If no to provide services to non-Federal Federal Government) and cost. requirement exists within NASA, the outside organizations for a fee that is (vi) Information from which one can availability of the equipment shall be less than private companies charge for calculate the percentage of Federal reported to the General Services equivalent services, unless specifically participation in the cost of the Administration by NASA to determine authorized by Federal statute, for as equipment (not applicable to equipment whether a requirement for the long as the Federal Government retains furnished by the Federal Government). equipment exists in other Federal an interest in the equipment. (vii) Location and condition of the agencies. NASA shall issue instructions (c) The recipient shall use the equipment and the date the information to the recipient no later than 120 equipment in the project or program for was reported. calendar days after the recipient’s which it was acquired as long as (viii) Unit acquisition cost. request and the following procedures needed, whether nor not the project or (ix) Ultimate disposition data, shall govern. program continues to be supported by including date of disposal and sales (1) If so instructed or if disposition Federal funds and shall not encumber price or the method used to determine instructions are not issued within 120 the property without approval of NASA. current fair market value where a calendar days after the recipient’s When no longer needed for the original recipient compensates NASA for its request, the recipient shall sell the project or program, the recipient shall share. equipment and reimburse NASA an use the equipment in connection with (2) Equipment owned by the Federal amount computed by applying to the its other federally-sponsored activities, Government shall be identified to sales proceeds the percentage of Federal in the following order of priority: indicate Federal ownership. participation in the cost of the original (1) Activities sponsored by NASA, (3) A physical inventory of equipment project or program. However, the then shall be taken and the results reconciled recipient shall be permitted to deduct (2) Activities sponsored by other with the equipment records at least once and retain from the Federal share $500 Federal agencies. every two years. Any differences or ten percent of the proceeds, (d) During the time that equipment is between quantities determined by the whichever is less, for the recipient’s used on the project or program for physical inspection and those shown in selling and handling expenses. which it was acquired, the recipient the accounting records shall be (2) If the recipient is instructed to shall make it available for use on other investigated to determine the causes of ship the equipment elsewhere, the projects or programs if such other use the difference. The recipient shall, in recipient shall be reimbursed by the will not interfere with the work on the connection with the inventory, verify Federal Government by an amount project or program for which the the existence, current utilization, and which is computed by applying the equipment was originally acquired. First continued need for the equipment. percentage of the recipient’s Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38079 participation in the cost of the original award. NASA is granted a royalty-free, in establishing procedures for the project or program to the current fair nonexclusive and irrevocable right to procurement of supplies and other market value of the equipment, plus any reproduce, publish, or otherwise use the expendable property, equipment, real reasonable shipping or interim storage work for Federal purposes, and to property and other services with Federal costs incurred. authorize others to do so. funds. These standards are furnished to (3) If the recipient is instructed to (b) Recipients are subject to ensure that such materials and services otherwise dispose of the equipment, the applicable regulations governing patents are obtained in an effective manner and recipient shall be reimbursed by NASA and inventions, including government- in compliance with the provisions of for such costs incurred in its wide regulations issued by the applicable Federal statutes and disposition. Department of Commerce at 37 CFR part executive orders. No additional (4) NASA may reserve the right to 401, ‘‘Rights to Inventions Made by procurement standards or requirements transfer the title to the Federal Nonprofit Organizations and Small shall be imposed by NASA upon Government or to a third party named Business Firms Under Government recipients, unless specifically required by NASA when such third party is Grants, Contracts and Cooperative by Federal statute or executive order or Agreements.’’ otherwise eligible under existing approved in accordance with the (c) NASA has the right to: statutes. Such transfer shall be subject to deviation procedures of § 1260.6. the following standards. (1) Obtain, reproduce, publish or (i) The equipment shall be otherwise use the data first produced § 1260.141 Recipient responsibilities. appropriately identified in the award or under an award. otherwise made known to the recipient (2) Authorize others to receive, The standards contained in this in writing. reproduce, publish, or otherwise use section do not relieve the recipient of (ii) NASA shall issue disposition such data for Federal purposes. the contractual responsibilities arising instructions within 120 calendar days (d) Title to intellectual property and under its contract(s). The recipient is after receipt of a final inventory. The debt instruments acquired under an the responsible authority, without final inventory shall list all equipment award or subcontract vests upon recourse to NASA, regarding the acquired with grant funds and federally- acquisition in the recipient. The settlement and satisfaction of all owned equipment. If NASA fails to recipient shall use that property for the contractual and administrative issues issue disposition instructions within the originally-authorized purpose, and the arising out of procurements entered into 120 calendar day period, the recipient recipient shall not encumber the in support of an award or other shall apply the standards of this section, property without approval of NASA. agreement. This includes disputes, as appropriate. When no longer needed for the claims, protests of award, source (iii) When NASA exercises its right to originally authorized purpose, evaluation or other matters of a take title, the equipment shall be subject disposition of the intangible property contractual nature. Matters concerning to the provisions for federally-owned shall occur in accordance with the violation of statute are to be referred to equipment. provisions of § 1260.134(g). such Federal, State or local authority as (e) Due to the substantial involvement may have proper jurisdiction. § 1260.135 Supplies and other expendable on the part of NASA under a property. cooperative agreement, intellectual § 1260.142 Codes of conduct. property may be produced by Federal (a) Title to supplies and other The recipient shall maintain written expendable property shall vest in the employees and NASA contractors standards of conduct governing the recipient upon acquisition. If there is a tasked to perform NASA assigned performance of its employees engaged residual inventory of unused supplies activities. Title to intellectual property in the award and administration of exceeding $5,000 in total aggregate created under the cooperative agreement contracts. No employee, officer, or agent value upon termination or completion by NASA or its contractors will initially shall participate in the selection, award, of the project or program and the vest with the creating party. Certain or administration of a contract supplies are not needed for any other rights may be exchanged with the supported by Federal funds if a real or federally-sponsored project or program, recipient. apparent conflict of interest would be the recipient shall retain the supplies § 1260.137 Property trust relationship. involved. Such a conflict would arise for use on non-Federal sponsored when the employee, officer, or agent, activities or sell them, but shall, in Real property, equipment, intangible either case, compensate the Federal property and debt instruments that are any member of his or her immediate Government for its share. The amount of acquired or improved with Federal family, his or her partner, or an compensation shall be computed in the funds shall be held in trust by the organization which employs or is about same manner as for equipment. recipient as trustee for the beneficiaries to employ any of the parties indicated (b) The recipient shall not use of the project or program under which herein, has a financial or other interest supplies acquired with Federal funds to the property was acquired or improved. in the firm selected for an award. The provide services to non-Federal outside NASA may require recipients to record officers, employees, and agents of the organizations for a fee that is less than liens or other appropriate notices of recipient shall neither solicit nor accept private companies charge for equivalent record to indicate that personal or real gratuities, favors, or anything of services, unless specifically authorized property has been acquired or improved monetary value from contractors, or by Federal statute as long as the Federal with Federal funds and that use and parties to subagreements. However, Government retains an interest in the disposition conditions apply to the recipients may set standards for supplies. property. situations in which the financial interest is not substantial or the gift is an Procurement Standards § 1260.136 Intangible property. unsolicited item of nominal value. The (a) The recipient may assert copyright § 1260.140 Purpose of procurement standards of conduct shall provide for in any work that is subject to copyright standards. disciplinary actions to be applied for and was created, or for which copyright Sections 1260.141 through 1260.148 violations of such standards by officers, ownership was purchased, under an set forth standards for use by recipients employees, or agents of the recipient. 38080 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

§ 1260.143 Competition. of products and services dimensioned in Order 12549 and 12689, ‘‘Debarment All procurement transactions shall be the metric system of measurement. and Suspension.’’ conducted in a manner to provide, to (vi) Preference, to the extent (e) Recipients shall, on request, make the maximum extent practical, open and practicable and economically feasible, available for NASA, pre-award review free competition. The recipient shall be for products and services that conserve and procurement documents, such as alert to organizational conflicts of natural resources and protect the request for proposals or invitations for interest as well as noncompetitive environment and are energy efficient. bids, independent cost estimates, etc., practices among contractors that may (b) Positive efforts shall be made by when any of the following conditions restrict or eliminate competition or recipients to utilize small businesses, apply. otherwise restrain trade. In order to minority-owned firms, and women’s (1) A recipient’s procurement ensure objective contractor performance business enterprises, whenever possible. procedures or operation fails to comply and eliminate unfair competitive Recipients of NASA awards shall take with the procurement standards in advantage, contractors that develop or all of the following steps to further this NASA’s implementation of this draft specifications, requirements, goal. Regulation. statements of work, invitations for bids (1) Ensure that small businesses, (2) The procurement is expected to and/or requests for proposals shall be minority-owned firms, and women’s exceed the small purchase threshold excluded from competing for such business enterprises are used to the and is to be awarded without procurements. Awards shall be made to fullest extent practicable. competition or only one bid or offer is the bidder or offeror whose bid or offer (2) Make information on forthcoming received in response to a solicitation. is responsive to the solicitation and is opportunities available and arrange time (3) The procurement, which is most advantageous to the recipient, frames for purchases and contracts to expected to exceed the small purchase price, quality and other factors encourage and facilitate participation by threshold, specifies a ‘‘brand name’’ considered. Solicitations shall clearly small businesses, minority-owned firms, product. set forth all requirements that the bidder and women’s business enterprises. (4) The proposed award over the or offeror shall fulfill in order for the bid (3) Consider in the contract process small purchase threshold is to be or offer to be evaluated by the recipient. whether firms competing for larger awarded to other than the apparent low Any and all bids or offers may be contracts intend to subcontract with bidder under a sealed bid procurement. rejected when it is in the recipient’s small businesses, minority-owned firms, (5) A proposed contract modification interest to do so. and women’s business enterprises. changes the scope of a contract or (4) Encourage contracting with increases the contract amount by more § 1260.144 Procurement procedures. consortiums of small businesses, than the amount of the small purchase (a) All recipients shall establish minority-owned firms and women’s threshold. written procurement procedures. These business enterprises when a contract is § 1260.145 Cost and price analysis. procedures shall provide for, at a too large for one of these firms to handle Some form of cost or price analysis minimum, that the conditions in individually. shall be made and documented in the paragraphs (a) (1), (2) and (3) of this (5) Use the services and assistance, as procurement files in connection with section apply. appropriate, of such organizations as the (1) Recipients avoid purchasing every procurement action. Price analysis Small Business Administration and the unnecessary items. may be accomplished in various ways, Department of Commerce’s Minority (2) Where appropriate, an analysis is including the comparison of price Business Development Agency in the made of lease and purchase alternatives quotations submitted, market prices and solicitation and utilization of small to determine which would be the most similar indicia, together with discounts. businesses, minority-owned firms and economical and practical procurement Cost analysis is the review and women’s business enterprises. for the Federal Government. evaluation of each element of cost to (c) The type of procuring instruments (3) Solicitations for goods and determine reasonableness, allocability used (e.g., fixed price contracts, cost services provide for all of the following. and allowability. (i) A clear and accurate description of reimbursable contracts, purchase orders, the technical requirements for the and incentive contracts) shall be § 1260.146 Procurement records. material, product or service to be determined by the recipient but shall be Procurement records and files for procured. In competitive procurements, appropriate for the particular purchases in excess of the small such a description shall not contain procurement and for promoting the best purchase threshold shall include the features which unduly restrict interest of the program or project following at a minimum. competition. involved. The ‘‘cost-plus-a-percentage- (a) Basis for contractor selection, (ii) Requirements which the bidder/ of-cost’’ or ‘‘percentage of construction (b) Justification for lack of offeror must fulfill and all other factors cost’’ methods of contracting shall not competition when competitive bids or to be used in evaluating bids or be used. offers are not obtained, and proposals. (d) Contracts shall be made only with (c) Basis for award cost or price. (iii) A description, whenever responsible contractors who possess the practicable, of technical requirements in potential ability to perform successfully § 1260.147 Contract administration. terms of functions to be performed or under the terms and conditions of the A system for contract administration performance required, including the proposed procurement. Consideration shall be maintained to ensure contractor range of acceptable characteristics or shall be given to such matters as conformance with the terms, conditions minimum acceptable standards. contractor integrity, record of past and specifications of the contract and to (iv) The specific features of ‘‘brand performance, financial and technical ensure adequate and timely follow up of name or equal’’ descriptions that resources or accessibility to other all purchases. Recipients shall evaluate bidders are required to meet when such necessary resources. In certain contractor performance and document, items are included in the solicitation. circumstances, contracts with certain as appropriate, whether contractors (v) The acceptance, to the extent parties are restricted by 14 CFR part have met the terms, conditions and practicable and economically feasible, 1265, the implementation of Executive specifications of the contract. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38081

§ 1260.148 Contract provisions. of all persons supplying labor and (c) If inappropriate, a final technical The recipient shall include, in material in the execution of the work or performance report shall not be addition to provisions to define a sound provided for in the contract. required after completion of the project. and complete agreement, the following (4) Where bonds are required in the (d) When required, performance provisions in all contracts. The situations described herein, the bonds reports shall generally contain, for each following provisions shall also be shall be obtained from companies award, brief information on each of the applied to subcontracts. holding certificates of authority as following. (a) Contracts in excess of the small acceptable sureties pursuant to 31 CFR (1) A comparison of actual purchase threshold shall contain part 223, ‘‘Surety Companies Doing accomplishments with the goals and contractual provisions or conditions Business with the United States.’’ objectives established for the period, the that allow for administrative, (d) All negotiated contracts (except findings of the investigator, or both. contractual, or legal remedies in those for less than the small purchase Whenever appropriate and the output of instances in which a contractor violates threshold) awarded by recipients shall programs or projects can be readily or breaches the contract terms, and include a provision to the effect that the quantified, such quantitative data provide for such remedial actions as recipient, NASA, the Comptroller should be related to cost data for may be appropriate. General of the United States, or any of computation of unit costs. (b) All contracts in excess of the small their duly authorized representatives, (2) Reasons why established goals purchase threshold shall contain shall have access to any books, were not met, if appropriate. suitable provisions for termination by documents, papers and records of the (3) Other pertinent information the recipient, including the manner by contractor which are directly pertinent including, when appropriate, analysis which termination shall be effected and to a specific program for the purpose of and explanation of cost overruns or high the basis for settlement. In addition, making audits, examinations, excerpts unit costs. such contracts shall describe conditions and transcriptions. (e) Recipients shall not be required to under which the contract may be (e) All contracts, including small submit more than the original and two terminated for default as well as purchases, awarded by recipients and conditions where the contract may be copies of performance reports. their contractors shall contain the terminated because of circumstances (f) Recipients shall immediately notify procurement provisions of Appendix A beyond the control of the contractor. NASA of developments that have a (c) Except as otherwise required by to this subpart, as applicable. significant impact on the award- statute, an award that requires the Reports and Records supported activities. Also, notification contracting (or subcontracting) for shall be given in the case of problems, construction or facility improvements § 1260.150 Purpose of reports and delays, or adverse conditions which shall provide for the recipient to follow records. materially impair the ability to meet the its own requirements relating to bid Sections 1260.151 through 1260.153 objectives of the award. This guarantees, performance bonds, and set forth the procedures for monitoring notification shall include a statement of payment bonds unless the construction and reporting on the recipient’s the action taken or contemplated, and contract or subcontract exceeds financial and program performance and any assistance needed to resolve the $100,000. For those contracts or the necessary standard reporting forms. situation. subcontracts exceeding $100,000, NASA They also set forth record retention (g) NASA may make site visits, as may accept the bonding policy and requirements. needed. requirements of the recipient, provided (h) NASA shall comply with the NASA has made a determination § 1260.151 Monitoring and reporting clearance requirements of 5 CFR part program performance. that the Federal Government’s interest is 1320 when requesting performance data adequately protected. If such a (a) Recipients are responsible for from recipients. determination has not been made, the managing and monitoring each project, § 1260.152 Financial reporting. minimum requirements shall be as program, subcontract, function or follows. activity supported by the award. (a) When funds are advanced to (1) A bid guarantee from each bidder Recipients shall monitor subcontracts to recipients, each recipient is required to equivalent to five percent of the bid ensure subcontractors have met the submit the SF–272, Report of Federal price. The ‘‘bid guarantee’’ shall consist audit requirements as delineated in Cash Transactions, and, when of a firm commitment such as a bid § 1260.126. necessary, its continuation sheet, SF bond, certified check, or other (b) The terms and conditions of the 272a. NASA uses this report to monitor negotiable instrument accompanying a award shall prescribe the frequency cash advanced to the recipient and bid as assurance that the bidder shall, with which the performance reports obtain disbursement information for upon acceptance of his bid, execute shall be submitted. Except as provided each agreement with the recipient. such contractual documents as may be in § 1260.151(f), performance reports (b) NASA requires forecasts of the required within the time specified. shall not be required more frequently recipient’s cash requirements for each of (2) A performance bond on the part of than quarterly or, less frequently than the four months following the quarter the contractor for 100 percent of the annually. Annual reports shall be due being reported, in the ‘‘Remarks’’ contract price. A ‘‘performance bond’’ is 90 calendar days after the grant year; section of the report. one executed in connection with a quarterly or semi-annual reports shall be (c) Recipients are required to submit contract to secure fulfillment of all the due 30 days after the reporting period. the original of the report for the contractor’s obligations under such NASA may require annual reports Financial Management Office of the contract. before the anniversary dates of multiple NASA Center which issued the (3) A payment bond on the part of the year awards in lieu of these agreement 15 working days following contractor for 100 percent of the requirements. The final performance the end of each Federal fiscal quarter. contract price. A ‘‘payment bond’’ is one reports are due 90 calendar days after Copies will be furnished to the executed in connection with a contract the expiration or termination of the appropriate grants officer (see to assure payment as required by statute award. § 1260.26(c)). 38082 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

§ 1260.153 Retention and access recipients that are pertinent to an termination that the reduced or requirements for records. award, except when NASA can modified portion of the grant will not (a) This section sets forth demonstrate that such records shall be accomplish the purposes for which the requirements for record retention and kept confidential and would have been grant was made, it may terminate the access to records for awards to exempted from disclosure pursuant to grant in its entirety under either recipients. NASA shall not impose any the Freedom of Information Act (5 paragraphs (a)(1) or (2) or this section. other record retention or access U.S.C. 552) if the records have belonged (b) If costs are allowed under an requirements upon recipients. to NASA. award, the responsibilities of the (b) Financial records, supporting (g) Indirect cost rate proposals, cost recipient referred to in § 1260.171(a), documents, statistical records, and all allocations plan, etc. Paragraphs (g)(1) including those for property other records pertinent to an award and (g)(2) of this section apply to the management as applicable, shall be shall be retained for a period of three following types of documents, and their considered in the termination of the years from the date of submission of the supporting records: Indirect cost rate award, and provision shall be made for final expenditure report or, for awards computations or proposals, cost continuing responsibilities of the that are renewed quarterly or annually, allocation plans, and any similar recipient after termination, as from the date of the submission of the accounting computations of the rate at appropriate. quarterly or annual financial report, as which a particular group of costs is authorized by NASA. The only chargeable (such as computer usage § 1260.162 Enforcement. exceptions are the following. chargeback rates or composite fringe (a) Remedies for noncompliance. If a (1) If any litigation, claim, or audit is benefit rates). recipient materially fails to comply with started before the expiration of the (1) If submitted for negotiation. If the the terms and conditions of an award, three-year period, the records shall be recipient submits to NASA or the whether stated in a Federal statute, retained until all litigation, claims or subrecipient submits to the recipient the regulation, assurance, application, or audit findings involving the records proposal, plan, or other computation to notice of award, NASA may, in addition have been resolved and final action form the basis for negotiation of the rate, to imposing any of the special taken. then the 3-year retention period for its conditions outlined in § 1260.114, take (2) Records for real property and supporting records starts on the date of one or more of the following actions, as equipment acquired with Federal funds such submission. appropriate in the circumstances. shall be retained for 3 years after final (2) If not submitted for negotiation. If (1) Temporarily withhold cash disposition. the recipient is not required to submit payments pending correction of the (3) When records are transfered to or to NASA or the subrecipient is not deficiency by the recipient or more maintained by NASA, the 3-year required to submit to the recipient the severe enforcement action by NASA. retention requirement is not applicable proposal, plan, or other computation for (2) Disallow (that is, deny both use of to the recipient. negotiation purposes, then the 3-year funds and any applicable matching (4) Indirect cost rate proposals, cost retention period for the proposal, plan, credit for) all or part of the cost of the allocations plans, etc. as specified in or other computation and its supporting activity or action not in compliance. section 1260.153(g). records starts at the end of the fiscal (3) Wholly or partly suspend or (c) Copies of original records may be year (or other accounting period) substituted for the original records if terminate the current award. covered by the proposal, plan, or other (4) Withhold further awards. authorized by NASA. computation. (d) NASA shall request transfer of (5) Take other remedies that may be certain records to its custody from Termination and Enforcement legally available. recipients when it determines that the (b) Hearings and appeals. In taking an § 1260.160 Purpose of termination and enforcement action, NASA shall provide records possess long term retention enforcement. the recipient an opportunity for hearing, value. However, in order to avoid Sections 1260.161 and 1260.162 set duplicate record keeping, NASA may appeal, or other administrative forth uniform suspension, termination proceeding to which the recipient is make arrangements for recipients to and enforcement procedures. retain any records that are continuously entitled under any statue or regulation needed for joint use. § 1260.161 Termination. applicable to the action involved. (e) NASA, the Inspector General, (a) Awards may be terminated in (c) Effects of suspension and Comptroller General of the United whole or in part only if the conditions termination. Costs of a recipient States, or any of their duly authorized in paragraph (a)(1), (2) or (3) of this resulting from obligations incurred by representatives, have the right of timely section apply. the recipient during a suspension or and unrestricted access to any books, (1) By NASA, if a recipient materially after termination of an award are not documents, papers, or other records of fails to comply with the terms and allowable unless NASA expressly recipients that are pertinent to the conditions of an award. authorizes them in the notice of awards, in order to make audits, (2) By NASA with the consent of the suspension or termination or examinations, excerpts, transcripts and recipient, in which case the two parties subsequently. Other recipient costs copies of such documents. This right shall agree upon the termination during suspension or after termination also includes timely and reasonable conditions, including the effective date which are necessary and not reasonably access to a recipient’s personnel for the and, in the case of partial termination, avoidable are allowable if the conditions purpose of interview and discussion the portion to be terminated. in paragraphs (c) (1) and (2) of this related to such documents. The rights of (3) By the recipient upon sending to section apply. access in this paragraph are not limited NASA written notification setting forth (1) The costs results from obligations to the required retention period, but the reasons for such termination, the which were properly incurred by the shall last as long as records are retained. effective date, and, in the case of partial recipient before the effective date of (f) Unless required by statute, NASA termination, the portion to be suspension or termination, are not in shall place no restrictions on recipients terminated. However, if NASA anticipation of it, and in the case of a that limit public access to the records of determines in the case of partial termination, are noncancellable. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38083

(2) The costs would be allowable if § 1260.172 Subsequent adjustments and contracts in excess of $2,000 for construction the award were not suspended or continuing responsibilities. or repair awarded by recipients shall include expired normally at the end of the (a) The closeout of an award does not a provision for compliance with the funding period in which the termination affect any of the following. Copeland ‘‘Anti-Kickback’’ Act (18 U.S.C. (1) The right of NASA to disallow 874), as supplemented by Department of takes effect. Labor regulations (29 CFR part 3, (d) Relationship to debarment and costs and recover funds on the basis of ‘‘Contractors and Subcontractors on Public suspension. The enforcement remedies a later audit or other review. Building or Public Work Financed in Whole identified in this section, including (2) The obligation of the recipient to or in Part by Loans or Grants from the United suspension and termination, do not return any funds due as a result of later States’’). The Act provides that each preclude a recipient from being subject refunds, corrections, or other contractor shall be prohibited from inducing, to debarment and suspension under transactions. by any means, any person employed in the E.O.’s 12549 and 12689 and 14 CFR part (3) Audit requirements in § 1260.126. construction, completion, or repair of public work, to give up any part of the 1265 (see Section 1260.113). (4) Property management requirements in §§ 1260.131 through compensation to which he is otherwise After-The Award Requirements entitled. The recipient shall report all 1260.137. suspected or reported violations to NASA. § 1260.170 Purpose. (5) Records retention as required in 3. Davis-Bacon Act, as amended (40 U.S.C. § 1260.153. Sections 1260.171 through 1260.173 276a to a-7)—When required by Federal (b) After closeout of an award, a program legislation, all construction contain closeout procedures and other relationship created under an award contracts awarded by the recipients of more procedures for subsequent may be modified or ended in whole or than $2,000 shall include a provision for disallowances and adjustments. in part with the consent of the NASA compliance with the Davis-Bacon Act (40 U.S.C. 276a to a-7) and as supplemented by § 1260.171 Closeout procedures. and the recipient, provided the responsibilities of the recipient referred Department of Labor regulations (29 CFR part (a) Recipients shall submit, within 90 to in § 1260.173(a), including those for 5, ‘‘Labor Standards Provisions Applicable to calendar days after the date of Contracts Governing Federally Financed and property management as applicable, are completion of the award, all financial, Assisted Construction’’). Under this Act, considered and provisions made for performance, and other reports as contractors shall be required to pay wages to continuing responsibilities of the required by the terms and conditions of laborers and mechanics at a rate not less than recipient, as appropriate. the award. NASA may approve the minimum wages specified in a wage determination made by the Secretary of extensions when requested by the § 1260.173 Collection of amounts due. Labor. In addition, contractors shall be recipient. (a) Any funds paid to a recipient in required to pay wages not less than once a (b) Unless NASA authorizes an excess of the amount to which the week. The recipient shall place a copy of the extension, a recipient shall liquidate all recipient is finally determined to be current prevailing wage determination issued obligations incurred under the award entitled under the terms and conditions by the Department of Labor in each not later than 90 calendar days after the of the award constitute a debt to the solicitation and the award of a contract shall funding period or the date of be conditioned upon the acceptance of the Federal Government. If not paid within wage determination. The recipient shall completion as specified in the terms and a reasonable period after the demand for conditions of the award or in agency report all suspected or reported violations to payment, NASA may reduce the debt by the NASA. implementing instructions. the provisions of paragraph (a) (1), (2) or 4. Contract Work Hours and Safety (c) NASA shall make prompt (3) of this section. Standards Act (40 U.S.C. 327–333)—Where payments to a recipient for allowable (1) Making an administrative offset applicable, all contracts awarded by reimbursable costs under the award against other requests for recipients in excess of $2,000 for being closed out. reimbursements. construction contracts and in excess of (d) The recipient shall promptly (2) Withholding advance payments $2,500 for other contracts that involve the refund any balances of unobligated cash otherwise due to the recipient. employment of mechanics or laborers shall that NASA has advanced or paid and (3) Taking other action permitted by include a provision for compliance with that is not authorized to be retained by sections 102 and 107 of the Contract Work statute. Hours and Safety Standards Act (40 U.S.C. the recipient for use in other projects. (b) Except as otherwise provided by 327–333), as supplemented by Department of OMB Circular A–129 governs law, NASA shall charge interest on an Labor regulations (29 CFR part 5). Under unreturned amounts that become overdue debt in accordance with 4 CFR Subsection 102 of the Act, each contractor delinquent debts. chapter II, ‘‘Federal Claims Collection shall be required to compute the wages of (e) When authorized by the terms and Standards.’’ every mechanic and laborer on the basis of conditions of the award, NASA shall a standard work week of 40 hours. Work in Appendix A to Subpart B of Part 1260Ð excess of the standard work week is make a settlement for any upward or Contract Provisions downward adjustments to the Federal permissible provided that the worker is All contracts awarded by a recipient, compensated at a rate of not less than 11⁄2 share of costs after closeout reports are including small purchases, shall contain the times the basic rate of pay for all hours received. following provisions as applicable: worked in excess of 40 hours in the work (f) The recipient shall account for any 1. Equal Employment Opportunity—All week. Section 107 of the Act is applicable to real and personal property acquired contracts shall contain a provision requiring construction work and provides that no with Federal funds or received from the compliance with Executive Order 11246; laborer or mechanic shall be required to work Federal Government in accordance with ‘‘Equal Employment Opportunity,’’ as in surroundings or under working conditions § § 1260.131 through 1260.137. amended by Executive Order 11375, which are unsanitary, hazardous or (g) In the event a final audit has not ‘‘Amending Executive Order 11246 Relating dangerous. These requirements do not apply been performed prior to the closeout of to Equal Employment Opportunity,’’ and as to the purchases of supplies or materials or supplemented by regulations at 41 CFR part articles ordinarily available on the open an award, NASA shall retain the right to 60, ‘‘Office of Federal Contract Compliance market, or contracts for transportation or recover an appropriate amount after Programs, Equal Employment Opportunity, transmission of intelligence. fully considering the recommendations Department of Labor.’’ 5. Rights to Inventions Made Under a on disallowed costs resulting from the 2. Copeland ‘‘Anti-Kickback’’ Act (18 Contract or Agreement—Contracts or final audit. U.S.C. 874 and 40 U.S.C. 276c)—All agreements for the performance of 38084 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations experimental, developmental, or research DEPARTMENT OF THE TREASURY amendments made by Title VI shall take work shall provide for the rights of the effect 1 year after the date of enactment. Federal Government and the recipient in any Bureau of Alcohol, Tobacco and Accordingly, the majority of the resulting invention in accordance with 37 Firearms amendments made by Title VI do not CFR part 401, ‘‘Rights to Inventions Made by take effect until April 24, 1997. Nonprofit Organizations and Small Business 27 CFR Part 55 However, section 603 added a new Firms Under Government Grants, Contracts [T.D. ATF±382; (95R±0360)] section 842(o) to Title 18, U.S.C., which and Cooperative Agreements,’’ and any RIN 1512±AB61 provides that any person, other than an implementing regulations issued by the agency of the United States (including awarding agency. Commerce in Explosives; any military reserve component) or the 6. Clean Air Act (42 U.S.C. 7401 et seq.) Implementation of Provisions of Public National Guard of any State, possessing and the Federal Water Pollution Control Act Law 104±132, the Antiterrorism and any plastic explosive on the date of (33 U.S.C. 1251 et seq.), as amended— Effective Death Penalty Act of 1996, enactment, shall report to the Secretary Contracts of amounts in excess of $100,000 Relating to Plastic Explosives within 120 days after the date of shall contain a provision that requires the enactment the quantity of such recipient to agree to comply with all AGENCY: Bureau of Alcohol, Tobacco applicable standards, orders or regulations explosives possessed, the manufacturer and Firearms, (ATF), Department of the or importer, any marks of identification issued pursuant to the Clean Air Act (42 Treasury. U.S.C. 7401 et seq.) and the Federal Water on such explosives, and such other Pollution Control Act as amended (33 U.S.C. ACTION: Final rule (Treasury decision). information as the Secretary may prescribe by regulation. 1251 et seq.) Violations shall be reported to SUMMARY: This final rule implements This Treasury Decision adds a new NASA and the Regional Office of the certain provisions of Public Law 104– Subpart J to the regulations in 27 C.F.R. Environmental Protection Agency (EPA). 132, the Antiterrorism and Effective Part 55 titled ‘‘Marking of Plastic 7. Byrd Anti-Lobbying Amendment (31 Death Penalty Act of 1996. These Explosives.’’ All regulations relating to U.S.C. 1352)—Contractors who apply or bid regulations implement the law by Title VI of the Act will be in this for an award of $100,000 or more shall file requiring that all persons possessing subpart. A new section 55.181 the required certification. Each tier certifies plastic explosives on the date of implements the reporting requirement to the tier above that it will not and has not enactment report the quantity of such used Federal appropriated funds to pay any of section 842(o). This section requires explosives possessed and certain other person or organization for influencing or that any person, other than an agency of information to the Director within 120 attempting to influence an officer or the United States or the National Guard, days after the date of enactment. employee of any agency, a member of possessing plastic explosive on April Congress, officer or employee of Congress, or EFFECTIVE DATE: The regulations are 24, 1996, submit a report to the Director, an employee of a member of Congress in effective on July 23, 1996. ATF, no later than August 22, 1996. The connection with obtaining any Federal FOR FURTHER INFORMATION CONTACT: Gail report must be written and shall include contract, grant or any other award covered by E. Hosey, Firearms and Explosives the quantity of explosives possessed, the 31 U.S.C. 1352. Each tier shall also disclose Regulatory Division, 650 Massachusetts name and address of the manufacturer any lobbying with non-Federal funds that Avenue, NW., Washington, DC 20226, or importer, any marks of identification, takes place in connection with obtaining any (202) 927–8310. the location where the explosives are Federal award. Such disclosures are SUPPLEMENTARY INFORMATION: stored, and the name and address of the forwarded from tier to tier up to the possessor. recipient. Background The regulation adds two items of 8. Debarment and Suspension (Executive Public Law 104–132, 110 Stat. 1214, information to be reported in addition to Orders 12549 and 12689)—No contract shall the ‘‘Antiterrorism and Effective Death the information required by statute, i.e., be made to parties listed on the General Penalty Act of 1996’’ (hereafter ‘‘the storage location and name and address Services Administration’s List of Parties Act’’) was enacted on April 24, 1996. of the possessor. All information Excluded from Federal Procurement or The Act amended a number of Nonprocurement Programs in accordance required by this final rule will assist provisions of the Federal explosives with Executive Orders 12549 and 12689, ATF in determining whether plastic laws in 18 U.S.C. Chapter 40. Title VI ‘‘Debarment and Suspension.’’ This list explosives are possessed in compliance contains the names of parties debarred, of the Act, ‘‘Implementation of Plastic with the law. Specifically, the suspended, or otherwise excluded by Explosives Convention’’, added new information will assist in determining agencies, and contractors declared ineligible requirements to 18 U.S.C. Chapter 40 to whether plastic explosives possessed under statutory or regulatory authority other implement the ‘‘Convention on the after April 24, 1997, were imported into than Executive Order 12549. Contractors Marking of Plastic Explosives for the or manufactured in the United States with awards that exceed the small purchase Purpose of Detection, Done at Montreal prior to April 24, 1996 and are lawfully threshold shall provide the required on 1 March 1991.’’ In general, the possessed under the 3-year exception. amendments make it unlawful to ship, certification regarding its exclusion status Executive Order 12866 and that of its principal employees. transport, transfer, receive, or possess [FR Doc. 96–18363 Filed 7–22–96; 8:45 am] any plastic explosive that does not It has been determined that this final contain a detection agent. A number of rule is not a significant regulatory BILLING CODE 7510±01±M exceptions are provided in the law, action, because the economic effects including an exception for possession of flow directly from the underlying plastic explosives imported into or statute and not from this final rule. manufactured in the United States prior Therefore, a regulatory assessment is not to April 24, 1996. This exception required. expires at the end of the 3-year period Administrative Procedure Act beginning April 24, 1996. See 18 U.S.C. 842(n)(2)(A). Because this document merely Section 607 of the Act provides that, implements the one-time reporting except as otherwise provided, the requirement of section 842(o) that must Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38085 be met on or before August 22, 1996, days of the date of enactment. The likely Washington, DC 20091–0204. The report and because immediate guidance is respondents are Federal explosives shall include the quantity of plastic necessary for possessors of plastic licensees, and State, and local explosives possessed on April 24, 1996; explosives to comply with the governmental entities. Estimated total any marks of identification on such requirement, it is found to be annual reporting and recordkeeping explosives; the name and address of the impracticable to issue this Treasury burden: 1,000 hours. Estimated number manufacturer or importer; the storage decision with notice and public of respondents and recordkeepers: location of such explosives, including procedure under 5 U.S.C. 553(b), or 1,000. Estimated annual frequency of the city and State; and the name and subject to the effective date limitation in responses: One time only. address of the person possessing the section 553(d). Drafting Information. The author of this plastic explosives. Regulatory Flexibility Act document is Gail E. Hosey, Firearms and Signed: June 20, 1996. Explosives Regulatory Division, Bureau of John W. Magaw, The provisions of the Regulatory Alcohol, Tobacco and Firearms. Flexibility Act relating to an initial and Director. final regulatory analysis (5 U.S.C. 604) List of Subjects in 27 CFR Part 55 Approved: July 3, 1996. are not applicable to this final rule Administrative practice and John P. Simpson, because the agency was not required to procedure, Authority delegations, Deputy Assistant Secretary (Regulatory, publish a notice of proposed rulemaking Customs duties and inspection, Tariff, and Trade Enforcement). under 5 U.S.C. 553 or any other law. Explosives, Hazardous materials, [FR Doc. 96–18617 Filed 7–19–96; 9:57 am] Accordingly, a regulatory flexibility Imports, Penalties, Reporting and BILLING CODE 4810±31±P analysis is not required. recordkeeping requirements, Safety, Paperwork Reduction Act Security measures, Seizures and forfeitures, Transportation, and DEPARTMENT OF JUSTICE This regulation is being issued Warehouses. without prior notice and public procedure pursuant to the Authority and Issuance Office of Justice Programs Administrative Procedure Act (5 U.S.C. 27 CFR part 55 is amended as follows: Bureau of Justice Assistance 553). For this reason, the collection of information contained in this regulation PART 55ÐCOMMERCE IN 28 CFR Part 82 has been reviewed under the EXPLOSIVES [OJP (BJA) No. 1010] requirements of the Paperwork Reduction Act (44 U.S.C. 3507(j)) and, Paragraph 1. The authority citation RIN 1121±AA24 pending receipt and evaluation of for 27 CFR part 55 is revised to read as public comments, approved by the follows: State Criminal Alien Assistance Office of Management and Budget Authority: 18 U.S.C. 842, 843, 845, 846, Program 847. (OMB) under control number 1512– AGENCY: Office of Justice Programs, 0535. An agency may not conduct or Par. 2. Section 55.11 is amended by Bureau of Justice Assistance (BJA), sponsor, and a person is not required to adding the term ‘‘plastic explosive’’ to Justice. respond to, a collection of information read as follows: ACTION: Interim final rule. unless it displays a valid control § 55.11 Meaning of terms. number assigned by the Office of SUMMARY: This document removes the Management and Budget. * * * * * rule governing the State Criminal Alien Comments concerning the collection Plastic explosive. An explosive Assistance Program (SCAAP). Congress of information should be directed to the material in flexible or elastic sheet form changed the authorization for SCAAP in Office of Management and Budget, formulated with one or more high Fiscal Year 1996 and, as such, the Attention: Desk Officer for the explosives which in their pure form has program as set forth in this interim final 4 Department of the Treasury/Bureau of a vapor pressure less than 10¥ Pa at a rule is no longer in effect or necessary. Alcohol, Tobacco and Firearms, Office ° temperature of 25 C., is formulated EFFECTIVE DATE: Interim Rule Removal of Information and Regulatory Affairs, with a binder material, and is as a effective on July 23, 1996. Washington, DC 20503, with copies to mixture malleable or flexible at normal FOR FURTHER INFORMATION CONTACT: the Chief, Document Services Branch, room temperature. The Department of Justice Response Center Room 3450, Bureau of Alcohol, Tobacco * * * * * and Firearms, 650 Massachusetts or Linda McKay, SCAAP Coordinator, at Par. 3. Subpart J consisting of § 55.181 1–800-421–6770. Avenue, N.W., Washington, DC 20226. is added to read as follows: The estimated average annual burden SUPPLEMENTARY INFORMATION: This associated with the collection of Subpart JÐMarking of Plastic notice is to announce the removal of the information in this regulation is 1.0 Explosives Interim Final Rule, 28 CFR part 82, hour per respondent or recordkeeper. which was promulgated as a result of a The collection of information in this § 55.181 Reporting of plastic explosives. directive in the Fiscal Year 1995 regulation is in section 27 CFR 55.181. All persons, other than an agency of Department of Justice Appropriations This information is required by 18 the United States (including any Act, Title VIII of Public Law 103–317, U.S.C. 842(o) which requires that any military reserve component) or the and was published on October 6, 1994, person possessing plastic explosives on National Guard of any State, possessing 59 FR 50830. The Fiscal Year 1995 April 24, 1996, report the quantity of any plastic explosive on April 24, 1996, Appropriations Act allocated $130 such explosives possessed, the shall submit a report to the Director no million to 8 U.S.C. 1365 to create the manufacturer or importer, any marks of later than August 22, 1996. The report State Criminal Alien Assistance identification on such explosives, and shall be in writing and mailed by Program (SCAAP) to provide assistance such other information as the Secretary certified mail (return receipt requested) to states for costs associated with may prescribe by regulation within 120 to the Director at P.O. Box 50204, incarcerating illegal criminal aliens. No 38086 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations funds were appropriated under the August 22, 1996. If the effective date is The EPA has designated two areas as authority of 8 U.S.C. § 1365 this Fiscal delayed, timely notice will be published ozone nonattainment in the State of Year and therefore, this interim rule is in the Federal Register. Washington. The Puget Sound ozone no longer in effect and is being ADDRESSES: Written comments should nonattainment area is classified as removed. SCAAP will be continued by be sent to Montel Livingston SIP marginal and contains King, Pierce, and the Bureau of Justice Assistance under Manager, Office of Air Quality (OAQ– Snohomish counties. The Vancouver the authority of 8 U.S.C. 1252(j) to 107), EPA, 1200 6th Avenue, Seattle, Air Quality Maintenance Area is which Congress appropriated a total of WA 98101. Copies of material submitted classified as marginal and contains $500 million in Fiscal Year 1996. An to EPA may be examined during normal Clark county. Additionally, three areas announcement of funding and guidance business hours at the following in Washington state are designated as availability for the Fiscal Year 1996 locations: EPA, Region 10, Office of Air CO nonattainment areas. Both the program is being published Quality, 1200 Sixth Avenue (OAQ–107), Spokane Carbon Monoxide concurrently with this notice in the Seattle, Washington 98101, and the Nonattainment area (Spokane County) Federal Register. Washington State Department of and the Puget Sound Carbon Monoxide Ecology, P.O. Box 47600, Olympia, WA List of Subjects in 28 CFR Part 82 Nonattainment area (King, Pierce, and 98504–7600. Grant programs—aliens, Prisons. portions of Snohomish Counties) have FOR FURTHER INFORMATION CONTACT: design values greater than 12.7 ppm and Under the general program and Stephanie Cooper, Office of Air Quality, are designated as ‘‘moderate plus’’. The rulemaking authority of 42 U.S.C. 3742 (OAQ–107), 1200 6th Avenue, Seattle, Vancouver Air Quality Maintenance and 3782 and for the reasons set out in WA 98101, (206) 553–6917. Area is a ‘‘moderate’’ carbon monoxide the preamble, title 28, chapter I of the SUPPLEMENTARY INFORMATION: Code of Federal Regulations is amended nonattainment area, with a design value by removing part 82. I. Clean Air Act Requirements below 12.7 ppm. The central Puget Sound has an urbanized area population Nancy Gist, The Clean Air Act, as amended in of 1,793,612, and Spokane has an Director, Bureau of Justice Assistance. 1990 (CAA or Act), requires States to urbanized area population of 266,709. make changes to improve existing I/M [FR Doc. 96–18670 Filed 7–22–96; 8:45 am] Based on these nonattainment programs or implement new ones. BILLING CODE 4410±18±P designations and populations, a basic I/ Section 182(a)(2)(B) required any ozone M program is required in the Vancouver nonattainment area which has been classified as ‘‘marginal’’ (pursuant to and Puget Sound ozone nonattainment ENVIRONMENTAL PROTECTION area, while enhanced I/M programs are AGENCY section 181(a) of the Act) or worse with an existing I/M program that was part of required in the Puget Sound, and 40 CFR Part 52 a SIP, or any area that was required by Spokane carbon monoxide the 1977 Amendments to the Act to nonattainment areas. [WA43±7116a; FRL±5514±4] have an I/M program, to immediately By this action, the EPA is approving Approval and Promulgation of Air submit a SIP revision to bring the the submittal of the Washington I/M Quality Implementation Plans; program up to the level required in past SIP. The EPA has reviewed the State Washington; Revision to the State EPA guidance or to what had been submittal against the statutory Implementation Plan Vehicle committed to previously in the SIP, requirements and for consistency with Inspection and Maintenance Programs whichever was more stringent. All the EPA regulations. A summary of the carbon monoxide nonattainment areas EPA’s analysis is provided below. In AGENCY: Environmental Protection were also subject to this requirement to addition, a history and a summary to Agency (EPA). improve existing or previously required support approval of the State submittal ACTION: Direct final rulemaking. programs to this level. In addition, any is contained in a TSD, dated May 10, ozone nonattainment area classified as 1996, which is available from the SUMMARY: In this action, EPA is moderate or worse must implement a Region 10 Office (address provided approving the Inspection and basic or an enhanced I/M program above). Maintenance (I/M) State depending upon its classification, Implementation Plan (SIP), for regardless of previous requirements. II. I/M Regulation General SIP Washington State. On August 21, 1995, Congress directed the EPA in section Submittal Requirements Washington submitted SIP revision 182(a)(2)(B) to publish updated requests to the EPA to satisfy the guidance for State I/M programs, taking The original I/M regulation was requirements of sections 182(b)(4) and into consideration findings of the codified at 40 CFR part 51, Subpart S, 182(c)(3) of the Clean Air Act, as Administrator’s audits and and required States to submit an I/M SIP amended and Federal I/M rule 40 CFR investigations of these programs. The revision which includes all necessary part 51, subpart S. These SIP revisions States were to incorporate this guidance legal authority and the items specified will require vehicle owners to comply into the SIP for all areas required by the in 40 CFR 51.372 (a)(1) through (a)(8) by with the Washington I/M program in the Act to have an I/M program. Ozone November 15, 1993. On September 18, two Washington ozone nonattainment nonattainment areas classified as 1995, the EPA published a final areas classified as ‘‘marginal’’ and in the ‘‘serious’’ or worse with populations of regulation establishing the ‘‘low three carbon monoxide nonattainment 200,000 or more, and CO nonattainment enhanced’’ I/M requirements, pursuant areas classified as ‘‘moderate’’. This areas with design values above 12.7 to section 182 and 187 of the Act (40 revision applies to the Washington ppm and populations of 200,000 or CFR part 51). These low enhanced I/M counties of Clark, King, Pierce, more, and metropolitan statistical areas requirements superseded the former Snohomish, and Spokane. with populations of 100,000 or more in enhanced I/M requirements. The State DATES: This action is effective on the northeast ozone transport region, has met the low enhanced I/M September 23, 1996, unless adverse or were required to meet EPA guidance for requirements established by the critical comments are received by enhanced I/M programs. September 18, 1995 rulemaking. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38087

III. State Submittal. B. Enhanced and Basic I/M Performance met which includes: (1) A detailed Standard budget plan which describes the source On August 21, 1995, the State of The I/M programs provided for in the of funds for personnel, program Washington submitted the I/M SIP for administration, program enforcement, its three nonattainment areas. Public SIP are required to meet a performance standard, either basic or low enhanced purchase of necessary equipment (such hearings for the submittal were held in as vehicles for undercover audits), and as applicable, for the pollutants that Vancouver, Bellevue, and Spokane on any other requirements discussed caused the affected area to come under June 6, 7, and 8, 1995, respectively. throughout, for the period prior to the I/M requirements. The performance next biennial self-evaluation required in The submittals provide for the standard sets an emission reduction the Federal I/M rule, (2) a description of continued implementation of I/M target that must be met by a program in personnel resources, the number of programs in the Puget Sound, Spokane, order for the SIP to be approvable. The personnel dedicated to overt and covert and Vancouver areas. Inspection and SIP must also provide that the program auditing, data analysis, program Maintenance programs have been will meet the performance standard in administration, enforcement, and other running in the Puget Sound area since actual operation, with provisions for necessary functions and the training 1982, in Spokane since 1985, and in appropriate adjustments if the standard attendant to each function. Vancouver since 1993. Washington’s is not met. The Emission Check program is centralized, test only, biennial program The State has submitted a modeling funded by a biennial appropriation from meets the requirements of EPA’s low demonstration using the EPA computer the state general fund. The fee will be enhanced performance standard and model MOBILE5ah showing that the set at the minimum whole dollar other requirements contained in the low enhanced performance standard is amount required to (i) compensate the Federal I/M rule in the applicable met for Puget Sound and Spokane. The contractor or inspection facility owner, nonattainment counties. Testing will be State has also submitted modeling for and (ii) offset the general fund overseen by the Washington State the basic I/M area of Vancouver to appropriation to the department to Department of Ecology and its I/M demonstrate that the program meets cover the administrative costs of the contractor, Systems Control. Other EPA’s basic performance standard. motor vehicle emission inspection aspects of the Washington I/M program C. Network Type and Program program (RCW 70.120.170(4)(a)). include: testing of 1968 and later light Evaluation Currently, the inspection fee is $12 and duty vehicles and trucks and heavy duty the administrative cost per vehicle is The SIP needs to include a trucks, a test fee to ensure the State has $3.90 for the 1993–1995 biennium. description of the network to be adequate resources to implement the In May, 1996, Ecology submitted a employed, and the required legal supplement to the SIP providing more program, enforcement by registration authority. For enhanced I/M areas, the denial, a repair effectiveness program, detail on budget and staffing levels. The SIP needs to include a description of the I/M program has a General Fund budget contractual requirements for testing evaluation schedule and protocol, the convenience, quality assurance, data of $3,861,939 for the 1995–97 biennium, sampling methodology, the data and that budget will likely be carried collection, reporting, test equipment collection and analysis system, the into the 1997–99 biennium. Ecology and test procedure specifications, public resources and personnel for evaluation, dedicates a staffing level of 31 full-time information and consumer protection, and related details of the evaluation equivalent employees (FTEs) to support and inspector training and certification. program, and the legal authority the program. In addition, the low enhanced I/M enabling the evaluation program. programs will include: a two-speed The Washington program has chosen E. Test Frequency and Convenience (2500 and idle) test or a loaded idle test, to implement a test only I/M network The SIP needs to include the test and a program to evaluate on-road program design which will utilize schedule in detail including the test testing. An analysis of how the operating contractors to implement the year selection scheme if testing is other Washington I/M program meets the inspection portion of the program. The than annual. Also, the SIP needs to EPA’s I/M regulation is provided below. Washington State Department of include the legal authority necessary to Ecology describes and commits, in its implement and enforce the test A. Applicability SIP narrative, to institute a continuous frequency requirement and explain how The SIP needs to describe the ongoing evaluation program consistent the test frequency will be integrated applicable areas in detail and, with the low enhanced I/M rule. The with the enforcement process. In consistent with 40 CFR 51.372, needs to results of the evaluation program will be addition, in low enhanced I/M programs include the legal authority or rules reported to EPA on a biennial basis. the SIP needs to demonstrate that the necessary to establish program Legal authority which is contained in network of stations providing test boundaries. the Revised Code of Washington section services is sufficient to insure short 70.120.170 allows the WDOE to waiting times to get a test and short The Washington I/M regulations authorize, through contracts, the driving distances. specify that I/M programs be establishment and operation of The Washington SIP requires biennial implemented in the counties as inspection stations to conduct vehicle inspections for all privately owned described above. Although Vancouver inspections. Washington commits to an vehicles within the subject area, and requires only the basic I/M program for ongoing evaluation to quantify the annual tests for state and local both its ozone and carbon monoxide emission reduction benefits of the government vehicles. The inspections nonattainment areas, the state is program. will be conducted so that odd model implementing one ‘‘low enhanced’’ year vehicles must test in the odd program in all areas that require I/M D. Adequate Tools and Resources calendar year and even model year programs. In the SIP, however, the The SIP needs to include a vehicles must test in the even calendar performance standard for Vancouver is description of the resources that will be year. The authority for the enforcement compared to EPA’s basic performance used for program operation, and discuss of the testing frequency is contained in standard. how the performance standard will be the Washington I/M rule. Short waiting 38088 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations times are addressed the contracts two-speed idle and 2500 RPM unloaded include the necessary legal authority, between the State and its managing test. Diesel vehicles are tested for ordinance, or rules to issue waivers, set contractors. In terms of driving exhaust opacity only. Specified vehicles and adjust cost limits as required, and distances, 95% of the subject public are are tested using a transient emissions carry out any other functions necessary within ten minutes of most test test. to administer the waiver system, facilities. including enforcement of the waiver H. Test Equipment provisions. F. Vehicle Coverage The SIP needs to include written Cost limits for the minimum The SIP needs to include a detailed technical specifications for all test expenditure waivers must be in description of the number and types of equipment used in the program and accordance with the CAA and Federal I/ vehicles to be covered by the program, shall address each of the requirements M rule. To receive a waiver within basic and a plan for how those vehicles are to in 40 CFR 51.358 of the Federal I/M and enhanced areas within Washington, be identified, including vehicles that are rule. The specifications need to describe vehicle owners are required to spend at routinely operated in the area but may the emission analysis process, the least $100 or more on 1968 to 1980 not be registered in the area. Also, the necessary test equipment, the required vehicles, and at least $150 or more on SIP needs to include a description of features, and written acceptance testing 1981 and newer vehicles in an attempt any special exemptions which will be criteria and procedures. to correct applicable emission failure(s). granted by the program, and an estimate The Washington I/M SIP describes the The SIP pledges that by 1998, these of the percentage and number of subject performance features of computerized limits will be adjusted to $450 in the vehicles which will be impacted. Such test systems, gasoline exhaust gas enhanced I/M areas, and in basic areas, exemptions need to be accounted for in analyzer specifications, and exhaust gas to $200. Washington’s waiver rates (as the emission reduction analysis. In analyzer specifications. For transient percentages of initially failed vehicles) addition, the SIP needs to include the emissions tests, EPA’s ‘‘High Tech I/M are, for Central Puget Sound and legal authority or rule necessary to Test Procedures, Emission Standards, Vancouver, 15% for 1980 and older implement and enforce the vehicle Quality Control Requirements and vehicles, and 14% for 1981 and newer coverage requirement. Equipment Specifications’’ Final vehicles; and for Spokane, 13% for 1980 The Washington program includes Technical Guidance is followed. and older vehicles, and 12% for 1981 coverage of all 1968 and newer model and newer vehicles. These waiver rates I. Quality Control year gasoline powered light-duty are used in the modeling demonstration. vehicles and light-duty and heavy-duty The SIP needs to include a Ecology states in the SIP that if the trucks up to 8,500 GVWR, registered or description of quality control and waiver rates are higher than estimated, required to be registered within the recordkeeping procedures. The SIP the State will take corrective action to nonattainment areas and fleets primarily needs to include the procedures address the deficiency so that operated within an I/M program area. manual, rule, and ordinance or law compliance with the performance The starting model year of a vehicle describing and establishing the standard is assured. In Washington, a testing program may be changed each procedures of quality control. waiver, or ‘‘Certificate of Acceptance’’, year to include the most recent 24 The Washington I/M SIP includes a (COA) is issued by the contractor model years. I/M testing exemptions are Quality Control Plan that specifies through authority granted by the granted for change of ownership, quality control and periodic Department of Ecology. These waivers alternative fuel vehicles, electric maintenance procedures. Quality are consistent with the low-enhanced I/ vehicles, and motorcycles. control procedures are specified in M rule. All subject fleets must complete the WAC 173–422–120 and authorized by K. Motorist Compliance Enforcement emission inspection process, without a RCW 70.120. The Department of waiver option being available. Fleets Ecology’s Emission Check staff performs The SIP needs to provide information may be inspected in facilities other than inspections to ensure that operation of concerning the enforcement process, Systems Control facilities provided that the emission testing facilities, including: (1) A description of the Ecology approves the alternative tests. calibration and maintenance of exhaust existing compliance mechanism if it is Vehicles operated on federal analyzers and test procedures, training to be used in the future and the installations are required to be tested of management and inspection demonstration that it is as effective or regardless of whether the vehicles are personnel meet the standards as more effective than registration-denial registered in the state or local I/M area. outlined in WAC 173–422. enforcement; (2) an identification of the agencies responsible for performing Legal authority for the vehicle coverage J. Waivers and Compliance via is contained in the Washington I/M rule. each of the applicable activities in this Diagnostic Inspection section; (3) a description of and G. Test Procedures and Standards The SIP needs to include a maximum accounting for all classes of exempt The SIP needs to include a waiver rate expressed as a percentage of vehicles; and (4) a description of the description of each test procedure used. initially failed vehicles. This waiver rate plan for testing fleet vehicles, rental car The SIP also needs to include the rule, needs to be used for estimating emission fleets, leased vehicles, and any other ordinance or law describing and reduction benefits in the modeling special classes of subject vehicles, e.g. establishing the test procedures. analysis. Also, the State needs to take those operated in (but not necessarily The Washington I/M SIP establishes corrective action if the waiver rate registered in) the program area. Also, test vehicle procedures and standards exceeds that estimated in the SIP or the SIP needs to include a that at a minimum are consistent with revise the SIP and the emission determination of the current compliance EPA regulations. Test procedures and reductions claimed accordingly. In rate based on a study of the system that standards are specified in WAC 173– addition, the SIP needs to describe the includes an estimate of compliance 422–070. In Washington, all 1968 and waiver criteria and procedures, losses due to loopholes, counterfeiting, newer gasoline or diesel-fueled vehicles including cost limits, quality assurance and unregistered vehicles. In addition, are tested. The State will test vehicles methods and measures, and the SIP needs to include the legal on a steady-state dynamometer or by a administration. Lastly, the SIP shall authority to implement and enforce the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38089 program. Lastly, the SIP needs to The Washington I/M SIP includes a providing all area specific applicable include a commitment to an description of its quality assurance data as required, including enforcement level to be used for program. The goal of the quality computerized test data, quality modeling purposes and to be assurance program is to discover, assurance data, quality control, and maintained, at a minimum, in practice. correct, and prevent fraud, waste and enforcement data. Ecology’s Information The State has chosen to use abuse within the Emission Check Data Services maintains the data and registration denial as its primary program, including the accuracy of evaluates it for inclusion in yearly and enforcement mechanism in both basic equipment and the adequacy of biennial reports. The biennial reports and enhanced I/M areas. Motorists will procedures. The administration of will discuss any changes to the program be denied vehicle registration unless the quality assurance is performed by the design or implementation, program vehicle has complied with the I/M Emission Check staff and the weaknesses, and cures for those program requirements. The motorist Department of Ecology’s DOL liaison. weaknesses. The SIP text describes the performance licensing compliance enforcement P. Inspector Training and Licensing or audits, overt performance audits, covert program will be implemented by the Certification Washington State Department of performance audits, record audits, and Licensing (DOL). The DOL will deny equipment audits to occur under the The SIP needs to include a registration unless the vehicle owner quality assurance plan. description of the training program, the demonstrates proof of having passed an written and hands-on tests, and the N. Enforcement Against Contractors, licensing or certification process. emissions test, or has a waiver. Persons Stations and Inspectors The Department of Ecology has a who reside in emissions-contributing The SIP needs to include the penalty formal training and certification areas and who register their vehicle schedule and the legal authority for program for fleet and centralized outside of that area are subject to a $250 establishing and imposing penalties, contractor testing facilities. fine. A $250 fine will also be given to civil fines, license suspension, and Washington’s program includes citizens who obtain a vehicle license revocations. In the case of state training, certification, test procedures, without having an emissions test. The constitutional impediments to and public relations. Certification legal authority to implement and immediate suspension authority, the occurs after an inspector has passed an enforce the program is in Chapter 173– state Attorney General shall furnish an approved Department of Ecology written 422 WAC. official opinion for the SIP explaining test with a score of 80% or better, and L. Motorist Compliance Enforcement the constitutional impediment as well after a hands-on test. The legal authority Program Oversight as relevant case law. Also, the SIP needs for inspectors to attend and pass a to describe the administrative and course of study and become certified is The SIP needs to include a judicial procedures and responsibilities established by RCW 70.120.020. description of enforcement program relevant to the enforcement process, oversight and information management Q. Improving Repair Effectiveness including which agencies, courts, and activities. jurisdictions are involved; who will The SIP needs to include a The Washington I/M SIP provides for prosecute and adjudicate cases; and description of the technical assistance monthly reviews of exemptions and other aspects of the enforcement of the program to be implemented to improve waivers conducted by I/M field staff. program requirements, the resources to repair effectiveness, a description of the Additionally, the SIP provides for the be allocated to this function, and the procedures and criteria to be used in implementation of procedures to ensure source of those funds. meeting the performance monitoring effective overall performance of the The Washington I/M SIP includes requirements of this section for enforcement system. Examples include specific penalties in its enforcement enhanced I/M programs, and a verification of exempt vehicle status by against contractors, stations and description of the repair technician inspecting and confirming such vehicles inspectors. The SIP includes the State’s training resources available in the by the program or its delegate, and enforcement procedures which can be community. maintenance of an audit trail to allow pursued through either contractual Washington has several facets to its for assessment of enforcement (Systems Control Contract #99±92) or repair effectiveness program. effectiveness. Ecology will establish an regulatory action (WAC 173–422). Technician training is an ongoing information base used to evaluate and Specific penalties are outlined against element of the Emission Check Program, enforce the program. As part of this the contractor, fleet testers, and and technical colleges, independent effort, the testing database will be emission specialists. Emission Check training facilities, etc, are working to reviewed for accuracy and compared to personnel have authority under the assess and improve the current program. the registration database to determine Systems Control contract to stop Emission system diagnosis and repair program effectiveness, and establish inspections if invalid inspections are a curriculum will be consistent with 40 compliance rates. Noncomplying possibility. Inspectors may be CFR 51.369 (c). Also, performance motorists will have to pay a $250 fine. suspended if the Emission Check monitoring and evaluation of the repair facilities will help to identify the most M. Quality Assurance Program staff determines that they are not qualified. Legal authority is effective repair shops and the emission The SIP needs to include a contained in WAC 173–422–120. reductions obtained through these description of the quality assurance facilities. A list of the most effective program, and written procedures O. Data Analysis and Reporting repair shops will be provided to the manuals covering both overt and covert The SIP needs to describe the types of public through Systems Control. Also, performance audits, record audits, and data to be collected. repair shops are visited during audits, equipment audits. This requirement The Washington I/M SIP commits the and technicians are notified of does not include materials or discussion Department of Ecology to provide to information regarding effective repairs of details of enforcement strategies that EPA annual reports containing basic via a Department of Ecology newsletter. would ultimately hamper the statistics on the program for the Technician assistance is available enforcement process. previous year. The state commits to through a 1–800 number; the same 38090 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations service is available to the public at IV. Today’s Action private sector. This Federal action another 1–800 number. The EPA is approving the Washington approves pre-existing requirements under State or local law, and imposes R. Compliance With Recall Notices I/M SIP as meeting the requirements of the CAA and the Federal I/M rule. All no new Federal requirements. The SIP needs to describe the required SIP items have been adequately Accordingly, no additional costs to procedures used to incorporate the addressed as discussed in this Federal State, local, or tribal governments, or to vehicle recall lists provided into the Register action. the private sector, result from this inspection or registration database, the action. quality control methods used to insure V. Administrative Review The EPA has reviewed this request for that recall repairs are properly Under the Regulatory Flexibility Act, revision of the federally-approved SIP documented and tracked, and the 5 U.S.C. 600 et seq., EPA must prepare for conformance with the provisions of method (inspection failure or a regulatory flexibility analysis the 1990 Clean Air Act Amendments enacted on November 15, 1990. The registration denial) used to enforce the assessing the impact of any proposed or EPA has determined that this action recall requirements. final rule on small entities. 5 U.S.C. 603 conforms with those requirements. The Washington I/M SIP states that and 604. Alternatively, EPA may certify Nothing in this action should be vehicles that were not repaired as that the rule will not have a significant construed as permitting or allowing or required by an emission recall for which impact on a substantial number of small establishing a precedent for any future owner notification was attempted after entities. Small entities include small request for revision to any SIP. Each January 1, 1995 will not be inspected businesses, small not-for-profit request for revision to the SIP shall be until compliance with that recall is enterprises, and government entities considered separately in light of specific established. Information on recall with jurisdiction over populations of technical, economic and environmental notification is intended to remind the less than 50,000. factors and in relation to relevant vehicle owner or operator that an SIP approvals under section 110 and statutory and regulatory requirements. emission test is required and that subchapter I, Part D of the CAA do not This action has been classified as a manufacturers recalls must be create any new requirements, but Table 3 action for signature by the completed before tabs will be renewed. simply approve requirements that the Regional Administrator under the Thereby, notification of recall can be State is already imposing. Therefore, procedures published in the Federal directly referenced during the because the Federal SIP-approval does Register on January 19, 1989 (54 FR inspection. not impose any new requirements, I 2214–2225), as revised by a July 10, certify that it does not have a significant 1995 memorandum from Mary Nichols, S. On-Road Testing impact on any small entities affected. Assistant Administrator for Air and Moreover, due to the nature of the The SIP needs to include a detailed Radiation. The Office of Management Federal-State relationship under the description of the on-road testing and Budget (OMB) has exempted this CAA, preparation of a regulatory program required in enhanced I/M regulatory action from E.O. 12866 flexibility analysis would constitute areas, including the types of testing, test review. Federal inquiry into the economic limits and criteria, the number of The EPA is publishing this action reasonableness of State action. The CAA vehicles (the percentage of the fleet) to without prior proposal because the forbids EPA to base its actions be tested, the methods for collecting, Agency views this as a noncontroversial concerning SIPs on such grounds. analyzing, utilizing, and reporting the action and anticipates no adverse Union Electric Co. v. E.P.A., 427 U.S. results of on-road testing, and the comments. However, in a separate 246, 256–66 (S.Ct. 1976); 42 U.S.C. portion of the program budget to be document in this Federal Register 7410(a)(2). dedicated to on-road testing. publication, the EPA is proposing to Under Section 202 of the Unfunded approve the SIP revision should adverse The Washington SIP includes a Mandates Reform Act of 1995 or critical comments be filed. This description of its on-road testing (‘‘Unfunded Mandates Act’’), signed action will be effective September 23, program. The Department of Ecology into law on March 22, 1995, EPA must 1996 unless, by August 22, 1996 adverse will conduct an evaluation of on-road prepare a budgetary impact statement to or critical comments are received. testing options beginning in 1996. This accompany any proposed or final rule If the EPA receives such comments, testing should involve the required .5 that includes a Federal mandate that this action will be withdrawn before the percent of the subject fleet. The State may result in estimated costs to State, effective date by publishing a did not include additional modeling local, or tribal governments in the subsequent document that will credit for this program in their modeling aggregate; or to the private sector, of withdraw the final action. All public demonstration needed to meet EPA’s $100 million or more. Under Section comments received will be addressed in performance standard. 205, EPA must select the most cost- a subsequent final rule based on this T. Concluding Statement effective and least burdensome action serving as a proposed rule. The alternative that achieves the objectives EPA will not institute a second The criteria used to review the of the rule and is consistent with comment period on this action. Any submitted SIP revision are based on the statutory requirements. Section 203 parties interested in commenting on this requirements stated in Section 182 of requires EPA to establish a plan for action should do so at this time. If no the CAA and the most recent FederalI/ informing and advising any small such comments are received, the public M regulations (September 18, 1995). governments that may be significantly is advised that this action will be EPA has reviewed the Washington I/M or uniquely impacted by the rule. effective September 23, 1996. SIP revision. The Washington EPA has determined that the approval Under section 307(b)(1) of the Clean regulations and accompanying materials action promulgated does not include a Air Act, petitions for judicial review of contained in the SIP represent an Federal mandate that may result in this action must be filed in the United acceptable approach to the I/M estimated costs of $100 million or more States Court of Appeals for the requirements and meet the criteria to either State, local, or tribal appropriate circuit by September 23, required for approvability. governments in the aggregate, or to the 1996. Filing a petition for Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38091 reconsideration by the Administrator of (i) Incorporation by reference. modified base flood elevation this final rule does not affect the finality (A) July 26, 1995 letter from Director determinations are available for of this rule for the purposes of judicial of WDOE to the Regional Administrator inspection. review nor does it extend the time of EPA submitting revisions to WDOE’s The modifications are made pursuant within which a petition for judicial SIP consisting of the July 1995 to section 206 of the Flood Disaster review may be filed and shall not Washington State Implementation Plan Protection Act of 1973, 42 U.S.C. 4105, postpone the effectiveness of such rule for the Motor Vehicle Inspection and and are in accordance with the National or action. This action may not be Maintenance Program (including Flood Insurance Act of 1968, 42 U.S.C. challenged later in proceedings to Appendices A through F), adopted 4001 et seq., and with 44 CFR part 65. enforce its requirements. (See section August 1, 1995, and a supplement letter For rating purposes, the currently 307(b)(2), 42 U.S.C. 7607(b)(2). and ‘‘Tools and Resources’’ table dated effective community number is shown and must be used for all new policies Submission to Congress and the May 10, 1996. and renewals. General Accounting Office [FR Doc. 96–18199 Filed 7–22–96; 8:45 am] The modified base flood elevations Under section 801(a)(1)(A) of the BILLING CODE 6560±50±P are the basis for the floodplain Administrative Procedure Act (APA) as management measures that the amended by the Small Business community is required to either adopt Regulatory Enforcement Fairness Act of FEDERAL EMERGENCY or to show evidence of being already in 1996, EPA submitted a report containing MANAGEMENT AGENCY effect in order to qualify or to remain this rule and other required information qualified for participation in the 44 CFR Part 65 to the U.S. Senate, the U.S. House of National Flood Insurance Program. Representatives and the Comptroller Changes in Flood Elevation These modified elevations, together General of the General Accounting Determinations with the floodplain management criteria Office prior to publication of this rule in required by 44 CFR 60.3, are the today’s Federal Register. This rule is AGENCY: Federal Emergency minimum that are required. They not a ‘‘major rule’’ as defined by section Management Agency, FEMA. should not be construed to mean that 804(2) of the APA as amended. ACTION: Final rule. the community must change any List of Subjects in 40 CFR Part 52 existing ordinances that are more SUMMARY: Modified base (1% annual stringent in their floodplain Air pollution control, Carbon chance) flood elevations are finalized management requirements. The monoxide, Hydrocarbons, Incorporation for the communities listed below. These community may at any time enact by reference, Nitrogen dioxide, Ozone, modified elevations will be used to stricter requirements of its own, or Volatile organic compounds. calculate flood insurance premium rates pursuant to policies established by other Note: Incorporation by reference of the for new buildings and their contents. Federal, state or regional entities. Implementation Plan for the State of EFFECTIVE DATES: The effective dates for These modified elevations are used to Washington was approved by the Director of these modified base flood elevations are meet the floodplain management the Office of Federal Register on July 1, 1982. indicated on the following table and requirements of the NFIP and are also Dated: May 24, 1996. revise the Flood Insurance Rate Map(s) used to calculate the appropriate flood Jane S. Moore, (FIRMs) in effect for each listed insurance premium rates for new Acting Regional Administrator. community prior to this date. buildings built after these elevations are Part 52, chapter I, title 40 of the Code ADDRESSES: The modified base flood made final, and for the contents in these of Federal Regulations is amended as elevations for each community are buildings. follows: available for inspection at the office of The changes in base flood elevations the Chief Executive Officer of each are in accordance with 44 CFR 65.4. PART 52Ð[AMENDED] community. The respective addresses National Environmental Policy Act are listed in the following table. 1. The authority citation for Part 52 This rule is categorically excluded FOR FURTHER INFORMATION CONTACT: continues to read as follows: from the requirements of 44 CFR Part Authority: 42 U.S.C. 7401–7671q. Michael K. Buckley, P.E., Chief, Hazard 10, Environmental Consideration. No Identification Branch, Mitigation environmental impact assessment has Subpart WWÐWashington Directorate, 500 C Street S.W., been prepared. Washington, DC 20472, (202) 646–2756. 2. Section 52.2470 is amended by SUPPLEMENTARY INFORMATION: Regulatory Flexibility Act adding paragraph (c)(61) to read as The follows: Federal Emergency Management Agency The Acting Associate Director, makes the final determinations listed Mitigation Directorate, certifies that this § 52.2470 Identification of plan. below of modified base flood elevations rule is exempt from the requirements of * * * * * for each community listed. These the Regulatory Flexibility Act because (c) * * * modified elevations have been modified base flood elevations are (61) SIP revisions received from published in newspapers of local required by the Flood Disaster WDOE on August 21, 1995, requiring circulation and ninety (90) days have Protection Act of 1973, 42 U.S.C. 4105, vehicle owners to comply with its I/M elapsed since that publication. The and are required to maintain community program in the two Washington ozone Acting Associate Director has resolved eligibility in the National Flood nonattainment areas classified as any appeals resulting from this Insurance Program. No regulatory ‘‘marginal’’ and in the three carbon notification. flexibility analysis has been prepared. monoxide nonattainment areas The modified base flood elevations classified as ‘‘moderate’’. This revision are not listed for each community in Regulatory Classification applies to the Washington counties of this notice. However, this rule includes This final rule is not a significant Clark, King, Pierce, Snohomish, and the address of the Chief Executive regulatory action under the criteria of Spokane. Officer of the community where the section 3(f) of Executive Order 12866 of 38092 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

September 30, 1993, Regulatory Executive Order 12778, Civil Justice PART 65Ð[AMENDED] Planning and Review, 58 FR 51735. Reform 1. The authority citation for part 65 Executive Order 12612, Federalism This rule meets the applicable continues to read as follows: standards of section 2(b)(2) of Executive This rule involves no policies that Order 12778. Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 1978, 3 CFR, have federalism implications under List of Subjects in 44 CFR Part 65 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, Executive Order 12612, Federalism, 3 CFR, 1979 Comp., p. 376. dated October 26, 1987. Flood insurance, Floodplains, Reporting and recordkeeping § 65.4 [Amended] requirements. 2. The tables published under the Accordingly, 44 CFR part 65 is authority of § 65.4 are amended as amended to read as follows: follows:

Dates and name of news- Chief executive officer State and county Location paper where notice was of Effective date of Community published community modification No.

Georgia: Chatham Unincorporated Areas December 27, 1995, Janu- Mr. Joseph Mahany, April 3, 1996 ...... 130030C (FEMA Docket Areas ary 3, 1996, Savannah Chairman of the No. 7173). News-Press. Chatham County Board of Commis- sioners, 124 Bull Street, P.O. Box 8161, Savannah, Georgia 31412. Illinois: Cook (FEMA City of Country Club July 27, 1995, August 3, The Honorable Dwight July 20, 1995 ...... 170078 C Docket No. Hills. 1995, The Daily W. Welch, Mayor of 7150). Southtown and The Star. the City of Country Club Hills, 3700 West 175th Place, Country Club Hills, Illinois 60478. DeKalb (FEMA City of DeKalb ...... December 8, 1995, De- The Honorable Greg December 4, 1995 ...... 170182 B Docket No. cember 15, 1995, Daily Sparrow, Mayor of 7173). Chronicle. the City of DeKalb, 200 South 4th Street, DeKalb, Illinois 60115. DuPage County Unincorporated Areas March 20, 1995, March Mr. Gayle M. Franzen, March 15, 1995 ...... 170197 B (FEMA Docket 27, 1995, Chicago Trib- DuPage County No. 7137). une. Board Chairman, 421 North County Farm Road, Wheaton, Illi- nois 60187. New Jersey: Township of Delaware December 28, 1995, Janu- The Honorable Robert April 4, 1996 ...... 340506 B Hunterdon (FEMA ary 4, 1996, Hunterdon Reed, Mayor of the Docket No. 7173). County Democrat. Township of Dela- ware, Township Hall, Sergeantville, New Jersey 08557. Ohio: Lorain (FEMA City of Avon ...... December 28, 1995, Janu- The Honorable James December 15, 1995 .... 390348 C Docket No. 7173). ary 4, 1996, The Morn- A. Smith, Mayor of ing Journal. the City of Avon, 36774 Detroit Road, Avon, Ohio 44011. Wisconsin: La Crosse Unincorporated Areas January 4, 1996, January Mr. James A. Ehrsam, December 28, 1995 .... 550217 A (FEMA Docket No. 11, 1996, La Crosse La Crosse County 7173). Tribune. Board Chairman, 400 North Fourth Street, La Crosse, Wisconsin 54601.

(Catalog of Federal Domestic Assistance No. 44 CFR Part 65 SUMMARY: This interim rule lists 83.100, ‘‘Flood Insurance’’) communities where modification of the [Docket No. FEMA±7186] Dated: July 10, 1996. base (1% annual chance) flood Richard W. Krimm, Changes in Flood Elevation elevations is appropriate because of new Acting Associate Director for Mitigation. Determinations scientific or technical data. New flood [FR Doc. 96–18662 Filed 7–22–96; 8:45 am] insurance premium rates will be AGENCY: Federal Emergency calculated from the modified base flood BILLING CODE 6718±03±P Management Agency, FEMA. elevations for new buildings and their ACTION: Interim rule. contents. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38093

DATES: These modified base flood For rating purposes, the currently eligibility in the National Flood elevations are currently in effect on the effective community number is shown Insurance Program. No regulatory dates listed in the table and revise the and must be used for all new policies flexibility analysis has been prepared. Flood Insurance Rate Map(s) (FIRMs) in and renewals. Regulatory Classification effect prior to this determination for The modified base flood elevations each listed community. are the basis for the floodplain This interim rule is not a significant From the date of the second management measures that the regulatory action under the criteria of publication of these changes in a community is required to either adopt section 3(f) of Executive Order 12866 of newspaper of local circulation, any or to show evidence of being already in September 30, 1993, Regulatory person has ninety (90) days in which to effect in order to qualify or to remain Planning and Review, 58 FR 51735. request through the community that the qualified for participation in the Acting Associate Director reconsider the National Flood Insurance Program. Executive Order 12612, Federalism changes. The modified elevations may These modified elevations, together This rule involves no policies that be changed during the 90-day period. with the floodplain management criteria have federalism implications under ADDRESSES: The modified base flood required by 44 CFR 60.3, are the Executive Order 12612, Federalism, elevations for each community are minimum that are required. They dated October 26, 1987. available for inspection at the office of should not be construed to mean that the Chief Executive Officer of each the community must change any Executive Order 12778, Civil Justice community. The respective addresses existing ordinances that are more Reform stringent in their floodplain are listed in the following table. This rule meets the applicable management requirements. The FOR FURTHER INFORMATION CONTACT: community may at any time enact standards of section 2(b)(2) of Executive Michael K. Buckley, P.E., Chief, Hazard stricter requirements of its own, or Order 12778. Identification Branch, Mitigation pursuant to policies established by other List of Subjects in 44 CFR Part 65 Directorate, 500 C Street S.W., Federal, state or regional entities. Washington, DC 20472, (202) 646–2756. The changes in base flood elevations Flood insurance, Floodplains, SUPPLEMENTARY INFORMATION: The are in accordance with 44 CFR 65.4. Reporting and recordkeeping modified base flood elevations are not requirements. National Environmental Policy Act listed for each community in this Accordingly, 44 CFR part 65 is interim rule. However, the address of This rule is categorically excluded amended to read as follows: the Chief Executive Officer of the from the requirements of 44 CFR Part community where the modified base 10, Environmental Consideration. No PART 65Ð[AMENDED] flood elevation determinations are environmental impact assessment has available for inspection is provided. been prepared. 1. The authority citation for part 65 Any request for reconsideration must continues to read as follows: Regulatory Flexibility Act be based upon knowledge of changed Authority: 42 U.S.C. 4001 et seq.; conditions, or upon new scientific or The Acting Associate Director, Reorganization Plan No. 3 of 1978, 3 CFR, technical data. Mitigation Directorate, certifies that this 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, The modifications are made pursuant rule is exempt from the requirements of 3 CFR, 1979 Comp., p. 376. to section 201 of the Flood Disaster the Regulatory Flexibility Act because Protection Act of 1973, 42 U.S.C. 4105, modified base flood elevations are § 65.4 [Amended] and are in accordance with the National required by the Flood Disaster 2. The tables published under the Flood Insurance Act of 1968, 42 U.S.C. Protection Act of 1973, 42 U.S.C. 4105, authority of § 65.4 are amended as 4001 et seq., and with 44 CFR part 65. and are required to maintain community follows:

Dates and name of news- State and county Location paper where notice was Chief executive officer Effective date of modi- Community published of community fication No.

Alabama: Lauderdale City of Florence ...... May 24, 1996, May 31, The Honorable Eddie August 29, 1996 ...... 010140 C 1996, Times Daily. Frost, Mayor of the City of Florence, 110 West College Street, Florence, Alabama 35630. Illinois: Tazewell ...... Village of Morton ...... June 5, 1996, June 12, Dr. Robert D. May 28, 1996 ...... 170652D 1996 Tazewell News. Hertenstein, Presi- dent of the Village of Morton, P.O. Box 28, 120 North Main Street, Morton, Illinois 61550. LaSalle and Liv- City of Streator ...... May 7, 1996, May 14, The Honorable Robert May 2, 1996 ...... 170408 B ingston. 1996, The Times Press. Lee II, Mayor of the City of Streator, 204 South Bloomington Street, P.O. Box 517, Streator, Illinois 61364. 38094 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

Dates and name of news- State and county Location paper where notice was Chief executive officer Effective date of modi- Community published of community fication No.

Indiana: Porter ...... Town of Porter ...... May 28, 1996, June 4, Ms. Charlene Hauber, May 21, 1996 ...... 180208 B 1996, Chesterton Trib- Porter Town Clerk/ une. Treasurer,303 Frank- lin Street, Porter, Indi- ana 46304. Massachusetts: Barnstable ...... Town of Barnstable ..... May 13, 1996, May 20, Mr. Warren J. Ruther- May 1, 1996 ...... 250001 D 1996 Cape Cod Times. ford, Town of Barnstable Manager, Town Hall, 367 Main Street, Hyannis, Mas- sachusetts 02601. Do...... do ...... May 28, 1996, June 4, do ...... May 17, 1996 ...... 250001 D 1996, Cape Cod Times. Michigan: Wayne ...... Township of Canton .... May 30, 1996, June 6, Mr. Thomas Yack, Can- May 21, 1996 ...... 260219 B 1996, Canton Observer. ton Township Super- visor, 1150 South Canton Center Road, Canton, Michigan 48188. Ohio: Lorain ...... City of Avon ...... April 30, 1996, May 7, The Honorable James April 18, 1996 ...... 390348C 1996, The Morning A. Smith, Mayor of Journal. the City of Avon,36774 Detroit Road, Avon, Ohio 44011. Fairfield ...... Unincorporated Areas May 7, 1996, May 14, Mr. Allan Reid, Presi- April 30, 1996 ...... 390158 D 1996, Eagle-Gazette. dent of the Fairfield County Board of Commissioners, Fair- field County Court- house, 210 East Main Street, Room 301, Lancaster, Ohio 43130. Montgomery ...... do ...... May 29, 1996, June 5, Ms. Vicki Pegg, Mont- May 24, 1996 ...... 390775 C 1996, Dayton Daily gomery County Com- News. missioner, 451 West Third Street,Dayton, Ohio 45422±1260. Tennessee: Shelby ..... City of Germantown .... May 2, 1996, May 9, The Honorable Sharon April 23, 1996 ...... 470353 E 1996, Germantown Goldsworthy, Mayor News. of the City of Ger- mantown, 1930 South Germantown Road, P.O. Box 38809, Ger- mantown, Tennessee 38183±0809.

(Catalog of Federal Domestic Assistance No. SUMMARY: Base (1% annual chance) by contacting the office where the maps 83.100, ‘‘Flood Insurance.’’) flood elevations and modified base are available for inspection as indicated Dated: July 10, 1996. flood elevations are made final for the on the table below. Richard W. Krimm, communities listed below. The base ADDRESSES: The final base flood Acting Associate Director for Mitigation. flood elevations and modified base elevations for each community are [FR Doc. 96–18664 Filed 7–22 –96; 8:45 am] flood elevations are the basis for the available for inspection at the office of floodplain management measures that BILLING CODE 6718±03±P the Chief Executive Officer of each each community is required either to community. The respective addresses adopt or to show evidence of being are listed in the table below. 44 CFR Part 67 already in effect in order to qualify or remain qualified for participation in the FOR FURTHER INFORMATION CONTACT: Final Flood Elevation Determinations; National Flood Insurance Program Michael K. Buckley, P.E., Chief, Hazard Alabama, Et Al. (NFIP). Identification Branch, Mitigation EFFECTIVE DATE: The date of issuance of Directorate, 500 C Street S.W., AGENCY: Federal Emergency the Flood Insurance Rate Map (FIRM) Washington, DC 20472, (202) 646–2756. Management Agency (FEMA). showing base flood elevations and SUPPLEMENTARY INFORMATION: The modified base flood elevations for each Federal Emergency Management Agency ACTION: Final rule. community. This date may be obtained (FEMA or Agency) makes final Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38095 determinations listed below of base Administrative practice and #Depth in flood elevations and modified base procedure, Flood insurance, Reporting feet above flood elevations for each community and recordkeeping requirements. ground. Source of Flooding and Location *Elevation listed. The proposed base flood Accordingly, 44 CFR part 67 is in feet elevations and proposed modified base amended as follows: (NGVD) flood elevations were published in newspapers of local circulation and an PART 67Ð[AMENDED] ÐÐÐ opportunity for the community or Momence (City), Kankakee individuals to appeal the proposed 1. The authority citation for part 67 County (FEMA Docket No. determinations to or through the continues to read as follows: 7175) community was provided for a period of Authority: 42 U.S.C. 4001 et seq.; Kankakee River (Main Channel): ninety (90) days. The proposed base Reorganization Plan No. 3 of 1978, 3 CFR, Approximately 0.52 mile downstream of Dixie Highway ...... *615 flood elevations and proposed modified 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, Approximately 625 feet up- base flood elevations were also 3 CFR, 1979 Comp., p. 376. published in the Federal Register. stream of Union Pacific Rail- This final rule is issued in accordance § 67.11 [Amended] road ...... *620 with section 110 of the Flood Disaster Kankakee River North Channel: 2. The tables published under the Protection Act of 1973, 42 U.S.C. 4104, Just upstream of spillway ...... *618 authority of § 67.11 are amended as and 44 CFR part 67. Approximately 475 feet up- follows: stream of Union Pacific Rail- The Agency has developed criteria for road ...... *620 floodplain management in floodprone #Depth in areas in accordance with 44 CFR part Maps available for inspection feet above at the City Hall, 123 West ground. 60. Source of Flooding and Location River Street, Momence, Illinois. Interested lessees and owners of real *Elevation in feet property are encouraged to review the (NGVD) MASSACHUSETTS proof Flood Insurance Study and Flood Insurance Rate Map available at the ALABAMA Nantucket (Town), Nantucket address cited below for each County (FEMA Docket No. community. Valley Head (Town), De Kalb 7168) The base flood elevations and County (FEMA Docket No. Atlantic Ocean: modified base flood elevations are made 7172) At Great Point ...... *10 final in the communities listed below. Big Wills Creek (With Southern Approximately 0.2 mile south- Elevations at selected locations in each Railway): east of Great Point ...... *7 community are shown. At upstream side of Southern At the shoreline approximately National Environmental Policy Act. Railway ...... *1014 160 feet south of the inter- This rule is categorically excluded from Approximately 1,175 feet up- section of Clifford Street and the requirements of 44 CFR Part 10, stream of State Highway 117 *1049 Nonatum Avenue ...... *9 Environmental Consideration. No Big Wills Creek (Without South- Approximately 150 feet east of environmental impact assessment has ern Railway): the intersection of Adams been prepared. Approximately 1,500 feet Street and Nobadeer Ave- downstream of City Park Regulatory Flexibility Act. The Acting nue ...... *7 Bridge ...... *977 At the southern portion of Associate Director, Mitigation Approximately 1,625 feet up- Miacomet Pond ...... *8 Directorate, certifies that this rule is stream of State Highway 117 *1053 At Hummock Pond ...... *7 exempt from the requirements of the Maps available for inspection Nantucket Sound: Regulatory Flexibility Act because final at the Valley Head Town Hall, Head of the Harbor northern or modified base flood elevations are 41 Anderson Avenue, Valley portion ...... *7 required by the Flood Disaster Head, Alabama. Maps available for inspection Protection Act of 1973, 42 U.S.C. 4104, at the Nantucket Building Com- and are required to establish and ILLINOIS missioners Office, 37 Washing- maintain community eligibility in the ton Street, Nantucket, Massa- National Flood Insurance Program. No Village of Aroma Park, Kan- chusetts. regulatory flexibility analysis has been kakee County (FEMA Dock- prepared. et No. 7175) NEW JERSEY Regulatory Classification. This final Iroquois River: rule is not a significant regulatory action At the confluence with Kan- Clinton (Town), Hunterdon under the criteria of section 3(f) of kakee River ...... *608 County (FEMA Docket No. Executive Order 12866 of September 30, Approximately 0.3 mile up- 7172) 1993, Regulatory Planning and Review, stream of the confluence Beaver Brook: with Kankakee River ...... *608 58 FR 51735. Approximately 150 feet up- Kankakee River: stream of Interstate 78 ...... *205 Executive Order 12612, Federalism. Approximately 0.5 mile down- At upstream corporate limits .... *207 This rule involves no policies that have stream of the confluence of federalism implications under Executive Iroquois River ...... *608 Maps available for inspection Order 12612, Federalism, dated October At the confluence of Spring at the Clinton Town Hall, 43 26, 1987. Creek ...... *608 Leigh Street, Clinton, New Jer- sey. Executive Order 12778, Civil Justice Maps available for inspection Reform. This rule meets the applicable at the Aroma Park Village Hall, standards of section 2(b)(2) of Executive 108 West Front Street, Aroma Order 12778. Park, Illinois. 38096 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

#Depth in #Depth in #Depth in feet above feet above feet above ground. ground. ground. Source of Flooding and Location *Elevation Source of Flooding and Location *Elevation Source of Flooding and Location *Elevation in feet in feet in feet (NGVD) (NGVD) (NGVD)

NEW YORK Approximately 475 feet up- ÐÐÐ stream of Pomeroy Street .... *283 East Coventry (Township), Gorham (Town), Ontario Maps available for inspection Chester County (FEMA County (FEMA Docket No. at the Avondale Borough Hall, Docket No. 7138) 7164) Pomeroy Avenue, Avondale, Schuylkill River: Canandaigua Lake: Pennsylavnia. At the confluence with Pigeon At shoreline west of Orchard ÐÐÐ Creek ...... *122 Rest Road ...... *692 At the upstream corporate lim- Caln (Township), Chester At shoreline west of intersec- its ...... *135 County (FEMA Docket No. tion of East Lake and Pigeon Creek: 7138) Townline Road ...... *692 At the confluence with the Beaver Creek: Schuylkill River ...... *122 Maps available for inspection Approximately 0.6 mile down- at the Gorham Town Hall, At downstream side of Bethel stream of Lloyd Avenue ...... *245 Church Road ...... *125 4736 South Elm Street, Gor- Approximately 300 feet down- ham, New York. stream of Lloyd Avenue ...... *250 Maps available for inspection at the East Coventry Township ÐÐÐ Copeland Run: Building, 855 Ellis Woods Putnam (Town), Washington At CONRAIL ...... *282 Road, Pottstown, Pennsylvania County (FEMA Docket No. Approximately 100 feet up- 7159) stream of Donofrio Drive ...... *282 ÐÐÐ East Fallowfield (Township), Lake George: Maps available for inspection Chester County (FEMA Entire shoreline within commu- at the Caln Township Engi- Docket No. 7138) nity ...... *321 neering and Codes Depart- Doe Run: Maps available for inspection ment Municipal Building, 253 Approximately 1.64 miles at the Putnam Town Clerk's Municipal Drive, Thorndale, downstream of State Route Office, Route 22, Putnam Sta- Pennsylvania. 82 ...... *264 tion, New York. ÐÐÐ West Branch Brandywine Creek: Downingtown (Borough), Approximately 700 feet down- NORTH CAROLINA Chester County (FEMA stream of Strasburg Road .... *251 Docket No. 7138) Maps available for inspection Cary (Town), Pine Lake (FEMA East Branch Brandywine Creek: at the Township Building, 2264 Docket No. 7159) Approximately 650 feet down- Strasburg Road, East Pine Lake: stream of U.S. Highway 30 *247 Fallowfield, Pennsylvania. Entire shoreline of Pine Lake *383 Approximately 375 feet up- ÐÐÐ Swift Creek Tributary No. 7 stream of U.S. Highway 30 *250 (Basin 20, Stream 24) (Cur- East Pikeland (Township), Maps available for inspection rently shown as Pine Lake): Chester County (FEMA at the Borough Hall, 4 West Approximately 550 feet down- Docket No. 7138) Lancaster Avenue, stream of Lake Pine Drive ... *383 Schuylkill River: Downingtown, Pennsylvania. Approximately 1,275 feet At the confluence of Stony Run *107 downstream of Lake Pine ÐÐÐ Approximately 0.8 mile up- Drive ...... *383 East Brandywine (Township), stream of Conrail ...... *109 Maps available for inspection Chester County (FEMA French Creek: at the Engineering Department, Docket No. 7138) Downstream of State Routes 318 North Academy, Cary, Beaver Creek: 724 and 23 (Schuylkill Road) *118 North Carolina. At its upstream corporate limit *482 Maps available for inspection at the East Pikeland Township Maps available for inspection Building, Rapps Dam Road, PENNSYLVANIA at the East Brandywine Town- Kimberton, Pennsylvania. ship Municipal Office, 1214 Avondale (Borough), Chester Horseshoe Pike, Downingtown, ÐÐÐ County (FEMA Docket No. Pennsylvania. East Vincent (Township), 7164) ÐÐÐ Chester County (FEMA East Branch White Clay Creek: Docket No. 7138) East Caln (Township), Ches- Approximately 750 feet down- ter County (FEMA Docket Schuylkill River: stream of confluence of No. 7138) Approximately 1,300 feet up- Chatham Run ...... *270 stream of State Route 683 ... *113 Approximately 550 feet up- East Branch Brandywine Creek: At the upstream corporate lim- stream of confluence of Approximately 650 feet down- its ...... *122 Chatham Run ...... *271 stream of CONRAIL, ap- Pigeon Creek:. Trout Run: proximately 600 feet east of At the confluence with Schuyl- At confluence with East Branch the intersection of Brandy- kill River ...... *122 White Clay Creek ...... *270 wine Avenue and Boot Road *233 Approximately 1,550 feet Approximately 670 feet above Maps available for inspection downstream of Bethel confluence with East Branch at the East Caln Township Church Road ...... *124 White Clay Creek ...... *270 Building, 110 Bell Tavern French Creek: Chatham Run: Road, P.O. Box 232, Approximately 1,700 feet At confluence with East Branch Downingtown, Pennsylvania. downstream of Hollow Road *206 White Clay Creek ...... *271 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38097

Approximately 0.4 mile up- ÐÐÐ ÐÐÐ stream of Bertolet School New Garden (Township), Sadsbury (Township), Chester Road ...... *249 Chester County (FEMA County (FEMA Docket No. Maps available for inspection Docket Nos. 7138 and 7164) 7138) at the East Vincent Township East Branch White Clay Creek: Little Buck Run: Building, 262 Ridge Road, Approximately 0.4 mile up- Approximately 0.6 mile down- Spring City, Pennsylvania. stream of confluence with stream of most downstream ÐÐÐ Egypt Run ...... *253 crossing of U.S. Route 10 .... *470 Franklin (Township), Chester Approximately 0.9 mile up- Approximately 610 feet up- County (FEMA Docket Nos. stream of confluence with stream of Private Road ...... *592 7138 and 7164) Egypt Run ...... *255 Maps available for inspection West Branch Red Clay Creek: East Branch White Clay Creek: at the Sadsbury Township Approximately 1,050 feet up- Approximately 0.7 mile down- Building, Pine Alley, stream of Cedarcroft Road *286 stream of Newgarden Sta- Sadsburyville, Pennsylvania. tion Road ...... *255 At the downstream side of ÐÐÐ Township Line Road ...... *294 Approximately 0.2 mile down- Schuylkill Haven (Borough), stream of Newgarden Sta- Maps available for inspection Schuylkill County (FEMA tion Road ...... *259 at the New Garden Township Docket No. 7164) Building, 8934 Gap Newport Middle Branch White Clay Creek: Schuylkill River: Pike, Avondale, Pennsylvania. Approximately 0.4 mile down- Approximately 1.7 mile downstream of Avondale-New ÐÐÐ stream of confluence of London Road ...... *301 North Coventry (Township), Long Run ...... *501 Approximately 1,300 feet Chester County (FEMA Approximately 370 feet up- downstream of Avondale- Docket No. 7138) stream of confluence of New London Road ...... *306 Schuylkill River: West Branch Schuylkill River 526 Maps available for inspection Approximately 900 feet down- Long Run: at the Franklin Township Build- stream of U.S. Route 422 .... *135 At confluence with Schuylkill ing, Walker Road, At the county boundary ...... *148 River ...... *511 Kemblesville, Pennsylvania. Approximately 1,325 feet up- Maps available for inspection stream of Stoyers Dam ...... *511 ÐÐÐ at the North Coventry Town- Highland (Township), Chester ship Building, 845 South Han- Maps available for inspection County (FEMA Docket No. over Street, Pottstown, Penn- at the Schuylkill Haven Bor- 7164) sylvania. ough Hall, 12 West Main Street, Schuylkill Haven, Penn- Buck Run: ÐÐÐ sylvania. Penn (Township), Chester Approximately 2,000 feet ÐÐÐ downstream of Buck Run County (FEMA Docket No. Road ...... *357 7140) Schuylkill (Township), Ches- ter County (FEMA Docket Approximately 900 feet up- Middle Branch White Clay Creek: No. 7138) stream of most upstream Approximately 100 feet up- CONRAIL crossing ...... *447 stream of Tice Road ...... *422 Schuylkill River: Doe Run: Approximately 1,200 feet up- At confluence of Valley Creek Approximately 560 feet upstream of Tice Road ...... *428 (at the county boundary) ...... *88 Approximately 0.5 mile upstream of abandoned CON- Maps available for inspection stream of confluence of RAIL ...... *339 at the Penn Township Building, Pickering Creek ...... *98 Approximately 1,400 feet up- 150 Sunnyside Road, West Pickering Creek: stream of Creek Road ...... *413 Grove, Pennsylvania. At confluence with Schuylkill Maps available for inspection ÐÐÐ River ...... *98 at the Highland Township Phoenixville (Borough), Ches- At downstream side of State Building, R.D. 3, Guntree ter County (FEMA Docket Route 23 ...... *98 Road, Coatesville, Pennsylva- No. 7138) French Creek: nia. Schuylkill River: At u pstream side of State ÐÐÐ Approximately 0.6 mile down- Route 23 and 724 (Nutt Kennett Square (Borough), stream of State Route 29 Road) ...... *118 Chester County (FEMA (Church Street) ...... *98 At downstream side of Town- Docket No. 7138) At confluence of Stony Run ..... *107 ship Line Road ...... *119 Tributary 2 to East Branch Red French Creek: Maps available for inspection Road Clay Creek: At confluence with Schuylkill at the Schuylkill Township Hall, 801 Valley Park Road, Approximately 750 feet down- River ...... *99 Pheonixville, Pennsylvania stream of Walnut ...... *316 Approximately 50 feet down- ÐÐÐ Maps available for inspection stream of Main Street ...... *101 at the Kennett Square Borough Maps available for inspection Spring City (Borough), Ches- Hall, 120 North Broad Street, at the Pheonixville Borough ter County (FEMA Docket Kennett Square, Pennsylvania. Hall, 140 Church Street, No. 7138) Pheonixville, Pennsylvania. Schuylkill River: 38098 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

Approximately 1.2 miles down- Approximately 50 feet up- At confluence with Pine Creek stream of State Route 683 ... *109 stream of Hibernia Road ...... *443 and Williams Run ...... *464 Approximately 1,300 feet up- Maps available for inspection Officers Run: stream of State Route 683 ... *113 at the West Brandywine Town- Approximately 150 feet up- Maps available for inspection ship Building, 1199 Lafayette stream of State Route 41 ..... *461 at the Spring City Borough Road, Coatesville, Pennsylva- Approximately 350 feet down- Hall, 6 South Church Street, nia. stream of CONRAIL bridge *474 Spring City, Pennsylvania. Valley Creek No. 3: ÐÐÐ ÐÐÐ Approximately 175 feet up- West Chester (Borough), stream of State Route 41 ..... *461 Thornbury (Township), Ches- Chester County (FEMA Maps available for inspection ter County (FEMA Docket Docket No. 7138) No. 7138) at the West Sadsbury Town- Marshall Manor Tributary: ship Building, Moscow Road, West Fork of East Branch Ches- At the downstream Limit of Parkesburg, Pennsylvania. ter Creek: Study (Goshen Road) ...... *360 ÐÐÐ Approximately 950 feet up- Approximately 195 feet upstream of Farm Lane ...... 287* stream of Hillside Drive Willistown (Township), Ches- Approximately 1,600 feet up- South ...... *419 ter County (FEMA Docket stream of Farm Lane ...... *290 No. 7138) Maps available for inspection Maps available for inspection at the Building Inspectors Of- East Branch Ridley Creek: at the Thornbury Township fice, 401 East Gay Street, Approximately 500 feet up- # Building, Building 3, 754 West Chester, Pennsylvania. stream of Warrior Road ...... *437 Approximately 0.2 mile up- Cheyney-Thornton Road, ÐÐÐ Westtown, Pennsylvania. stream of Warrior Road ...... *445 West Grove (Borough), Ches- Maps available for inspection ÐÐÐ ter County (FEMA Docket at the Willistown Township Mu- Upper Uwchlan (Township), No. 7138) nicipal Building, 688 Chester County (FEMA Middle Branch White Clay Creek: Docket No. 7138) Sugartown Road, Malvern, Approximately 150 feet down- Pennsylvania. East Branch Brandywine Creek: stream of Valley Road ...... *372 Approximately 575 feet down- Approximately 50 feet up- VIRGINIA stream of Dolans Mill Road *283 stream of Valley Road ...... *373 Approximately 0.7 mile up- Maps available for inspection City of Virginia Beach, Inde- stream of Lyndell Road at its at the West Grove Borough upstream corporate limit ...... *343 pendent City (FEMA Docket Building, 117 Rose Hill Ave- No. 7155) Maps available for inspection nue, West Grove, Pennsylva- Chesapeake Bay: at the Upper Uwchlan Town- nia. ship Building, 140 Pottstown At the intersection of West Marlborough (Town- Oceanview and Fentiess Pike, Chester Springs, Penn- ship), Chester County sylvania. Avenues ...... *9 (FEMA Docket Nos. 7138 Approximately 220 feet north ÐÐÐ and 7164) of the intersection of Windy West Bradford (Township), Buck Run: Road and Sandy Bay Drive *12 Chester County (FEMA At upstream side of State Approximately 650 feet north- Docket No. 7138) Route 82 ...... *326 west of the intersection of East Branch Brandywine Creek: Approximately 1,700 feet Shore Drive and Vista Circle *10 Approximately 0.75 mile up- downstream of Buck Run Approximately 310 feet north stream of Strasburg Road .... *206 Road ...... *358 of the intersection of Ebb Approximately 0.3 mile down- Chatham Run: Tide Road and Ocean Shore stream of Downingtown At State Road 926 ...... *504 Avenue ...... *11 West Chester Road ...... *209 Approximately 350 feet up- Atlantic Ocean: West Branch Brandywine Creek: stream of Mosquito Road ..... *509 Approximately 130 feet east of the intersection of 20th Approximately 750 feet up- Maps available for inspection Street and Atlantic Avenue *11 stream of its confluence with at the Township Building, Doe Approximately 450 feet east of Tributary 2 ...... *194 Run Road, Route 82, Village of the intersection of 8th Street At confluence of Broad Run .... *198 Doe Run, Pennsylvania. Approximately 750 feet up- and Atlantic Avenue ...... *14 ÐÐÐ Lake Wishart: stream of Northbrook Road *203 West Sadsbury (Township), Maps available for inspection Entire shoreline ...... *8 Chester County (FEMA Bradford Lake: at the West Bradford Township Docket No. 7138) Hall, 1385 Campus Drive, Entire shoreline ...... *9 Downingtown, Pennsylvania. Pine Creek No. 2: Chubb Lake: At confluence with East Branch Entire shoreline ...... *9 ÐÐÐ Octoraro Creek and Williams Fox Run Canal: West Brandywine (Township), Run ...... *464 At the confluence with Eastern Chester County (FEMA Approximately 575 feet up- Branch Elizabeth River ...... *9 Docket No. 7138) stream of Zion Hill Road ...... *483 Approximately 1,200 feet up- West Branch Brandywine Creek: East Branch Octoraro Creek: stream of Churchill Drive ..... *13 At State Route 340 ...... *364 Just downstream of State Left Bank Tributary Thalia Creek: Route 372 ...... *458 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38099

#Depth in #Depth in under Amendment 1 and implemented feet above feet above by this final rule include: Gear and ground. ground. efficiency restrictions, scallop Source of Flooding and Location *Elevation Source of Flooding and Location *Elevation in feet in feet registration areas and districts, (NGVD) (NGVD) procedures for specifying total allowable catch (TAC) and crab bycatch Approximately 1,400 feet up- Approximately 0.3 mile up- limits (CBLs), time and area closures, stream of the mouth of stream of County Highway inseason management authority, fishing Thalia Creek ...... *8 AH (89th Street) ...... *763 seasons, and observer coverage At Windsor Oaks Boulevard .... *10 Maps available for inspection requirements. This action is necessary Holland Road Tributary Thalia at the Kenosha County Admin- to further the conservation and Creek: istration Building, 1010 56th management objectives of the FMP and At the confluence with Left Street, Kenosha, Wisconsin. the Magnuson Fishery Conservation and Bank Tributary Thalia Creek *10 ÐÐÐ At the downstream side of Hol- Management Act (Magnuson Act). Pleasant Praire (Village), Ke- land Road ...... *10 EFFECTIVE DATES: The changes to part nosha County (FEMA Dock- Unnamed Pond: 679 are effective August 1, 1996. The et 7172) Approximately 100 feet east of final 1996–97 harvest specifications and the intersection of East Port Lake Michigan: closure are effective August 1, 1996, Road and Gammon Road .... *9 Entire shoreline within commu- through June 30, 1997. Shallow Ponding Area: nity ...... *585 Barnes Creek North Outlet: ADDRESSES: Copies of Amendment 1 Approximately 400 feet east of At the confluence with Lake and the Environmental Assessment/ Atlantic Avenue on 65th Michigan ...... *585 Regulatory Impact Review/Final Street ...... #1 Approximately 100 feet down- Shallow Ponding Area: Regulatory Flexibility Analysis (EA/ stream of First Avenue ...... *586 Located in the vicinity of the RIR/FRFA) prepared for Amendment 1 Barnes Creek South Outlet: intersection of Sandpiper may be obtained from the North Pacific At the confluence with Lake Road and Oyster Lane ...... #2 Fishery Management Council, 605 W. Michigan ...... *585 4th Ave., Suite 306, Anchorage, AK Shallow Ponding Area: Approximately 200 feet up- Approximately 500 feet north stream of Third Avenue ...... *585 99501. of the State boundary line .... #3 Maps available for inspection FOR FURTHER INFORMATION CONTACT: Kent Maps available for inspection at the Pleasant Prairie Village Lind, 907–586–7228. at the City of Virginia Beach Hall, 9915 39th Avenue, Keno- SUPPLEMENTARY INFORMATION: Municipal Center, Operations sha, Wisconsin. Building No. 2, Virginia Beach. Background (Catalog of Federal Domestic Assistance No. The scallop fishery in the exclusive WISCONSIN 83.100, ‘‘Flood Insurance.’’) economic zone (Federal waters) off Dated: July 10, 1996. Kenosha (City), Kenosha Alaska is managed under the FMP. The Richard W. Krimm, County (FEMA Docket No. FMP was prepared by the North Pacific 7172) Acting Associate Director for Mitigation. Fishery Management Council (Council) Pike River: [FR Doc. 96–18660 Filed 7–22–96; 8:45 am] under the Magnuson Act. Regulations At confluence with Lake Michi- BILLING CODE 6718±04±P implementing the FMP are set out at 50 gan ...... *585 CFR part 679. General regulations that At downstream side of State also affect fishing in Federal waters are Route 32 ...... *585 DEPARTMENT OF COMMERCE set out at 50 CFR part 600. This action Lake Michigan: establishes Federal management Entire shoreline within the National Oceanic and Atmospheric measures to replace the interim closure community ...... *585 Administration of Federal waters off Alaska to fishing Maps available for inspection for scallops. The history of the scallop at the Kenosha City Hall, 625 50 CFR Part 679 fishery off Alaska and the events leading 52nd Street, Kenosha, Wiscon- [Docket No. 960502124±6190±02; I.D. up to the interim closure of Federal sin. 042396B] waters are described in the FMP and the ÐÐÐ preambles to the proposed and final Kenosha County (Unincor- RIN 0648±AF81 rules implementing the FMP (60 FR porated Areas) (FEMA 24822, May 10, 1995, and 60 FR 42070, Docket No. 7172) Scallop Fishery Off Alaska; Management Measures; 1996±97 August 15, 1995, respectively). Lake Michigan: In June 1995, the Council adopted Harvest Specifications Entire shoreline within commu- Amendment 1 to the FMP, which nity ...... *585 AGENCY: National Marine Fisheries authorizes Federal management Camp Lake: Service (NMFS), National Oceanic and measures to replace the interim closure Entire shoreline within commu- Atmospheric Administration (NOAA), of Federal waters to fishing for scallops. nity ...... *743 The Council’s preferred alternative for Center Lake: Commerce. Entire shoreline within commu- ACTION: Final rule; final 1996–97 harvest Amendment 1 was to incorporate nity ...... *744 specifications; closures. certain State of Alaska management Unnamed Tributary: measures into the Federal regulations At the State boundary ...... *742 SUMMARY: NMFS issues a final rule to and implement a vessel moratorium At Camp Lake dam ...... *743 implement Amendment 1 to the Fishery based on criteria adopted in April 1994 Unnamed Tributary to Center Management Plan for the Scallop and reaffirmed in January 1995. Lake: Fishery off Alaska (FMP). The At its January 1993 meeting, the At Center Lake inlet ...... *744 management measures established Council determined that unrestricted 38100 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations access to the scallop fishery may be and districts, procedures for specifying registration area rather than allow a harmful to the resource and result in a TACs and CBLs, time and area closures, combined TAC for multiple registration net loss to the Nation. The Council inseason management authority, fishing areas. This change was made to prevent announced a control date of January 20, seasons, and observer coverage overharvest from within one area. This 1993, to place the industry on notice requirements. change affects Registration Areas M, Q, that a moratorium for this fishery may and R. be implemented and any person or Changes From the Proposed Rule fishing vessel that entered the scallop Four changes were made from the 1996–97 Total Allowable Catch fisheries in Federal waters off Alaska proposed rule. First, since publication Specifications would not be assured of future access to of the proposed rule, the Federal those fishery resources if a moratorium regulations implementing Alaska FMPs The TACs for Registration Areas A, E, is implemented. In June 1995, the have undergone a comprehensive K, and O are unchanged from the Council developed final qualifying consolidation. As a consequence, most proposed specifications published with criteria for the vessel moratorium. of the regulations implementing the the proposed rule. TACS for Under the Council’s qualifying criteria, FMP for the scallop fishery off Alaska Registration Areas D, H, M, Q, and R vessels would qualify for inclusion in (50 CFR part 673) have been recodified have been changed from the proposed the moratorium if they made at least one at 50 CFR 679 subpart F, except for the specifications for the reasons cited legal landing of scallops in any year purpose and scope, definitions, and below. from 1991 through 1993, or during any prohibitions sections of the scallop In Registration Area D, the State 4 separate years from 1980 through regulations, which are now found in 50 authorized a January 1996 fishery inside 1990. This two-tier approach was CFR 679 subpart A. State waters and allowed the harvest of Second, in § 679.1(h)(2) the phrase chosen to emphasize recent the percentage of the annual TAC that participation in the fishery by allowing ‘‘consistent with’’ was changed to ‘‘in was estimated to be attributable to all vessels with any legal landings in addition to, and not in conflict with’’ so scallop beds within State waters. Under 1991, 1992 or 1993 to qualify. Historic that § 679.1(h)(2) reads as follows: the new regulations established by this participants would qualify under the ‘‘State of Alaska laws that are in more restrictive standard of a legal addition to, and not in conflict with, the rule, the fishing year for scallops runs landing in at least 4 years between 1980 regulations in this part are not from July 1 through June 30 of the and 1990. The Council’s final preempted for vessels registered under following fishing year. Consequently, in recommended qualifying criteria, which the laws of the State fishing for scallops Registration Area D, two TACs must be were published in the Council’s in the Federal waters off Alaska.’’ This specified to allow for the harvest of the newsletter, means that fishermen and/or change was made in response to a remaining 1995–96 TAC in Registration vessels not participating in the fishery comment and clarifies that NMFS Area D. The 1995–96 TAC amount that by December 31, 1993, may not be intends to allow the State to impose went unharvested during the State’s guaranteed future access to the fishery. additional regulations on State- January 1996 fishery is specified for the The Council subsequently separated registered vessels that are fishing for period August 1, 1996, through the vessel moratorium from Amendment scallops in Federal waters as long as December 31, 1996. The TAC for the 1 and recommended that the vessel State regulations are not in direct current 1996–97 fishing year TAC is moratorium be implemented as conflict with Federal regulations or the specified for the period January 1, 1997, Amendment 2 to the FMP. The Council FMP. through June 30, 1997. took this action to prevent moratorium Third, the 1996 fishing season in In Registration Areas M, Q, and R, and issues from delaying the reopening of Registration Area D is temporarily H (other than Kamishak District), a the scallop fishery. On May 10, 1996, extended in response to a comment to NMFS published a proposed rule to allow for the harvest of remaining 1995– combined TAC of 875,000 lb implement Amendment 1 to the FMP 96 State TAC amounts that were not (396,893.32 kg) shucked meat was listed (61 FR 21431). The comment period for harvested in this area during the January in the proposed specifications. This the proposed rule ended on June 21, 1996 fishery in State waters. In January combined TAC was subdivided by area 1996. Six letters of comment were 1996, the State authorized a fishery in to prevent overharvest of the TAC from received, which are summarized in the the State waters of Registration Area D within any one area. TACs for each of Response to Comments section below. for the estimated portion of the TACs these registration areas are now The regulations implementing that were attributable to beds in State specified at the historic high catch, Amendment 1 were developed in waters (8,000 lb (3,628.7 kg) shucked which is equal to the upper end of the coordination with the Council and the meat from District 16 and 55,000 lb OY range. No TAC is specified for State and are designed to complement (24,947.6 kg) from the remaining districts other than the Kamishak current State management of the scallop districts of Registration Area D). District of Registration Area H. The fishery. These regulations do not Because the entire portion of the 1996 other districts within Registration Area preclude the State from imposing TAC attributable to beds in State waters H lie primarily within State waters and additional regulations on State has been taken, the State has closed there are no known commercially viable registered vessels fishing in Federal State waters in Registration Area D until scallop beds in these districts. The State waters, so long as State regulations are 1997. Because State waters will remain may authorize exploratory scallop not in conflict with the FMP and its closed until 1997, the remaining 1996 fishing in these districts within State implementing regulations. The TAC for this area, which will become waters. Any exploratory fishing in preamble to the proposed rule provides available on August 1, 1996, will be Federal waters within these districts a description of and justification for available only in Federal waters. could be authorized by NMFS pursuant each Federal management measure Fourth, § 679.62(a) was changed in to ‘‘exempted fishing’’ regulations including: Gear and efficiency response to a comment to require that published at 50 CFR 600.745. restrictions, scallop registration areas available TAC be specified by Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38101

TABLE 1.ÐSCALLOP TAC AMOUNTS FOR THE PERIOD AUGUST 1, 1996, THROUGH JUNE 30, 1997, IN POUNDS (KILOGRAMS IN PARENTHESES) OF SHUCKED SCALLOP MEAT BY SCALLOP REGISTRATION AREA AND DISTRICT

TAC Scallop registration area lb kg

Area A (Southeastern) ...... zero

Area D (Yakutat): (Applicable August 1, 1996 through December 31, 1996) 1

District 16 ...... 27,000 12,247 All other districts ...... 195,000 88,451

(Applicable January 1, 1997 through June 30, 1997)

District 16 ...... 35,000 15,880 All other districts ...... 250,000 113,430 Area E (Prince William Sound) ...... 50,000 22,686 Area H (Cook Inlet): Kamishak District ...... 20,000 9,074 Area K (Kodiak) ...... 400,000 181,488 Area M (Alaska Peninsula) ...... 200,000 90,718 Area O (Dutch Harbor) ...... 170,000 77,132 Area Q (Bering Sea) ...... 600,000 272,155 Area R (Adak) ...... 75,000 43,019 Total 2 ...... 1,800,000 816,416 1 Represents unharvested TAC that would have been specified for the period July 1, 1995, through June 30 1996. Because the closure of Fed- eral waters prevented the harvest of this TAC during the January 1996 State-managed opening, NMFS is making this unharvested TAC amount available on August 1, 1996. The Area D TAC that would normally have been specified for the period August 1, 1996, through June 30, 1997 will not become effective until January 1, 1997. 2 Does not include the August 1, 1996, through December 31, 1996, TAC for Registration Area D because this TAC amount represents unharvested TAC from the previous fishing year.

1996–97 Crab Bycatch Limits These numbers are unchanged from the Table 2 shows CBLs for the period proposed specifications. August 1, 1996, through June 30, 1997.

TABLE 2.ÐCRAB BYCATCH LIMITS FOR THE PERIOD AUGUST 1, 1996, THROUGH JUNE 30, 1997, IN NUMBERS OF CRABS BY SCALLOP REGISTRATION AREA AND DISTRICT

Scallop registration area Red king C. bairdi C. opilio

Area A (Southeastern) ...... Area D (Yakutat) ...... Area E (Prince William Sound) ...... 630 ...... Area H (Cook Inlet): Kamishak District ...... 40 15,900 ...... Outer/Eastern Districts ...... 98 2,170 ...... Area K (Kodiak): Shelikof District ...... 22 16,100 ...... Northeast District ...... 66 130,000 ...... Area M (Alaska Peninsula) ...... 435 22,800 ...... Area O (Dutch Harbor) ...... 10 10,700 ...... Area Q (Bering Sea) ...... 500 257,000 275,000 Area R (Adak) ...... 50 10,000 ......

Closure Response to Comments needed and would, in fact, present further hardship to the fishing industry. In Registration Area A, the final Comment 1: The 30-day delay in Response: NMFS agrees. The 30-day scallop TAC amount for the period effectiveness normally incorporated into delayed effectiveness period for this August 1, 1996, through June 30, 1997, Federal rulemaking procedures should rule has been waived (see is zero. Therefore, under § 679.62(c), be waived. This rule will impact the ‘‘Classification’’ section, below). NMFS is prohibiting the catch and industry in a positive way by allowing Comment 2: The proposed rule has an retention of scallops in Registration fishing to resume after an 18-month August 15 opening date for Registration Area A from August 1, 1996, through hiatus brought about by a lack of Area H (Cook Inlet). A later opening June 30, 1997. Federal regulation. The period normally date of August 29 is recommended, viewed as an opportunity for industry to because crab tend to move out of this adapt to an onerous regulation is not area later in the season. A later opening date would produce less crab bycatch, 38102 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations which is a prime concern of industry their fishing days. A small vessel Registration Areas D and E would have and the Council. exemption should be reinstated for the already occurred in January. NMFS Response: Because a single TAC is scallop fishery, or a percentage-based would have more than sufficient time to specified for both the Federal and State coverage system similar to that used in make corresponding changes in Federal waters of each registration area or the groundfish fishery. fishing seasons through the normal district, a simultaneous opening of Response: All vessels required to regulatory process. Any conservation Federal and State waters is necessary to carry an observer under this rule will emergency that warrants an immediate prevent localized overfishing of scallop need to provide accommodations for an adjustment of fishing seasons, or any stocks and reduce administration and observer. The loss of a bunk space is not other management measure, could be enforcement concerns. For these limited to small vessels. In addition, the made through the inseason adjustment reasons, opening dates in the Federal restrictions on dredge width and crew authority set out at § 679.63 or through waters of each registration area or size will tend to limit disparities in an emergency rule. district were scheduled to match harvesting capacity between large and Comment 5: The proposed rule existing State opening dates. If the small vessels. Therefore, NMFS does not establishes the TAC for each registration opening date for the Federal waters of believe that a 100 percent observer area as a single number. ADF&G Registration Area H were delayed until coverage requirement will have recommends that the TAC be set as a August 29, vessel operators might try to inordinate impacts on small vessels. range for each registration area. For harvest the entire TAC from within Nevertheless, NMFS is sensitive to the example, in the Yakutat Registration State waters that would open on August impacts that this rule will have on small Area, TAC should be set at 0 to 250,000 15. This situation could cause localized businesses and has taken numerous lb (113,430 kg) shucked meat. By stating overfishing of scallops stocks inside steps to reduce burdens on small TAC as a range, conservation State waters. Moreover, enforcement of businesses such as avoiding duplicate adjustments to harvest guidelines, either closures would be more problematic if State and Federal recordkeeping and preseason or inseason, would be adjacent State and Federal waters were recording requirements. In addition, the frameworked within regulations and open at different times. Therefore, the Council heard testimony on the burden would not require additional action by opening date for Registration Area H is of 100 percent observer requirements NMFS. unchanged. from small vessel owners during initial Response: The TACs specified by NMFS does not have adequate and final consideration of Amendment NMFS simply represent the upper end bycatch data to support or refute the 1. However, the Council believes, and of the range of acceptable harvests. No contention that crab bycatch would be NMFS concurs, that the need for requirement exists that the entire TAC appreciably lower if the opening date accurate management data outweighed be harvested in each registration area. were delayed until August 29. However, the economic impacts on small vessels. Indeed, NMFS expects that the scallop crab bycatch was certainly a One hundred percent observer coverage fishery in some registration areas will consideration of the Board of Fisheries is necessary outside Cook Inlet to close long before the entire TAC is when it established an August 15 accurately monitor crab bycatch, which harvested due to attainment of CBLs. No opening date for the Cook Inlet is a primary management concern management advantage would be Registration Area. In its comments on because crab populations are severely achieved by specifying TACs as a range, the proposed rule, ADF&G has indicated depleted throughout the area covered by because NMFS would still be required that possible changes to scallop opening the FMP. Observer data are also to publish an inseason adjustment or dates will be examined by the Board of required because little information is closure to affect any change in the Fisheries at the March 1997 meeting. If presently available on the status of fishery. NMFS believes that the bycatch data presented to the Board of scallop stocks in much of the inseason adjustment authority Fisheries indicate that a change in management area. Consequently, no established by this regulation is opening dates is warranted for the Cook observer coverage exemption was made sufficient to implement timely inseason Inlet Registration Area, NMFS, in for small vessels fishing outside of Cook changes to TACs, should they be coordination with the Council and the Inlet. warranted for conservation or State could address opening date Comment 4: The Alaska Department management reasons. changes at that time. of Fish and Game (ADF&G) is concerned Comment 6: Paragraph 673.1(c) of the Comment 3: While the exemption that the Federal regulatory system will proposed rule states ‘‘State of Alaska from observer coverage for vessels less not be flexible enough to reflect season laws that are consistent with the than 80 ft (24.4 m) length overall (LOA) changes made by the Alaska Board of regulations in this part are not in Cook Inlet is justified, a similar Fisheries, or by ADF&G emergency preempted for vessels registered under exemption is necessary for small vessels order. ADF&G believes that a real the laws of the State fishing for scallops fishing outside Cook Inlet. In the past, likelihood exists that the State seasons in the Federal waters off Alaska.’’ State regulations have exempted vessels established for Registration Areas D and Neither the FMP nor the proposed rule less than 65 ft (19.8 m) LOA from E will be changed in 1997. Seasons in adopt all of the areas closed by State to observer requirements. A number of State and Federal waters must be scallop fishing. Thus, one could vessels qualified for this exemption. If identical for conservation, as well as interpret paragraph 673.1(c) to mean small vessels must give up bunk space enforcement and fair start reasons. that State closed areas within Federal to carry an observer, they will lose a Response: NMFS may make waters could be preempted for State significant percentage of their workforce regulatory changes in fishing seasons at registered vessels. The areas closed by while incurring the extra expense of any time for conservation or the State to scallop fishing were adopted accommodating an observer. Therefore, management reasons in response to by the Board of Fisheries over 20 years small vessels will be hit doubly hard by recommendations from ADF&G or the ago to protect king and Tanner crab the 100 percent observer coverage Council. Any changes to State fishing stocks by using the best scientific requirement. In the groundfish observer seasons made at the March 1997 Board information available along with public program, vessels between 60 and 125 ft of Fisheries meeting could not become testimony. Crab stocks in these closed (18.3 and 38.1 m) LOA are only required effective before the 1998 fishing season areas are very depressed and to carry an observer for 30 percent of because the 1997 scallop fishery in commercial king crab fisheries have Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38103 been closed since 1983. Based on the NMFS believes that the loss of access to effectiveness under 5 U.S.C. 553(d)(1) is crab stock status and additional public State waters would far outweigh any not required. Additionally, with respect input, the Board of Fisheries confirmed possible advantage a vessel would gain to the new management measures the closures in 1994. by avoiding State-registration simply to imposed by this rule, there is good Response: NMFS did not implement fish in the closed areas in question. cause to waive the delayed effectiveness all of the closed areas that are currently Comment 8: ADF&G believes that period under 5 U.S.C. 553(d)(3) because established in State regulations, because separate TACs should be established for of the need to coordinate the opening of NMFS did not have sufficient Registration Areas M, Q, and R. The Federal waters with the August 1, 1996, information on crab bycatch and crab combined TAC of 875,000 lb (396,893.3 opening of State waters within each habitat immediately available to kg) of shucked meat creates a potential registration area. Furthermore, all propose such closures. To compile and risk of overfishing in any single area. vessels expected to fish in Federal analyze crab bycatch statistics for the Dependence on CBLs to protect the waters also fish in State waters where areas currently closed by the State prior scallop resource from overfishing in these regulatory requirements have been to publication of the proposed rule these areas is not appropriate. TACs for in effect and are familiar to the fleet. could have delayed the timely each registration area should be This rule has been determined to be reopening of the scallop fishery in established at historic high catch: not significant for the purposes of E.O. Federal waters. However, NMFS Registration Area M, 0 to 200,000 lb 12866. encourages the State to take any (90,718 kg) shucked meat; Registration The Council prepared a FRFA as part additional measures necessary to protect Area Q, 0 to 600,000 lb (272,155 kg) of the RIR, which describes the impacts scallop stocks and bycatch species for shucked meat; and Registration Area R, that this rule is expected to have on State-registered vessels fishing in 0 to 75,000 lb (43,019 kg) shucked meat. small entities. The economic effects of Federal waters. In § 679.1(h)(2), the Response: NMFS agrees. The final this rule to the regulated community are phrase ‘‘consistent with’’ was changed specifications of TAC for the period expected to be significant and positive. to ‘‘in addition to, and not in conflict August 1, 1996, through June 30, 1997, Because this rule repeals the total with’’ to clarify that NMFS intends to have been changed to reflect TACs of closure of Federal waters to fishing for allow the State to impose additional 200,000 lb (90,718 kg) shucked meat for scallops, significant opportunities for regulations on State-registered vessels Registration Area M, 600,000 lb scallop fishing will exist that could that are fishing for scallops in Federal (272,155 kg) shucked meat for otherwise be unavailable under current waters, as long as State regulations are Registration Area Q, and 75,000 lb regulations. The analysis concluded that not in direct conflict with Federal (43,019 kg) shucked meat for in 1994, 86 percent of the scallops regulations or the FMP. Registration Area R. harvested off Alaska were taken from Comment 7: The proposed rule does Comment 9: The Bristol Bay bottom Federal waters and 11 of the 16 vessels not close Federal waters presently trawl closures recently adopted by the harvesting scallops participated in no closed by the State to scallop fishing. Council should also be closed to scallop other fishery. This rule will restore the ADF&G is concerned that vessels that dredging to be consistent with Federal opportunity to fish in Federal waters are not registered with the State will not groundfish regulations and to assist in that was available prior to 1995. A copy comply with State regulations and could the protection and rebuilding efforts for of this analysis is available from NMFS legally fish in these closed areas. The the Bristol Bay red king crab stocks. (see ADDRESSES). State’s Fish and Wildlife Protection Response: NMFS agrees. All Federal Division cannot enforce regulations on waters that are closed to trawling for List of Subjects in 50 CFR Part 679 vessels that are not registered with the groundfish with nonpelagic trawl gear Fisheries, Reporting and State or do not enter State waters. for the purpose of habitat protection, recordkeeping requirements. ADF&G believes that NMFS limiting crab bycatch, or protecting Enforcement could not enforce these walrus rookeries and Steller sea lion Dated: July 17, 1996. closed waters if they are not established areas are also closed to dredging for Gary Matlock, in Federal regulations. scallops. If the Bristol Bay bottom trawl Program Management Officer, National Response: The reasons why NMFS closures recently adopted by the Marine Fisheries Service. did not implement all of the State Council are approved by NMFS, they For the reasons set out in the closures in Federal waters are outlined will also apply to dredging for scallops. preamble, 50 CFR part 679 is amended in the response to comment 6. Because as follows: the closed areas in question are not Classification established in Federal regulations, they The Director, Alaska Region, NMFS, PART 679ÐFISHERIES OF THE will not be enforced by NMFS, however, determined that Amendment 1 is EXCLUSIVE ECONOMIC ZONE OFF they may be enforced by the State for necessary for the conservation and ALASKA State-registered vessels. A vessel fishing management of the scallop fishery off for scallops that is not registered with Alaska and that it is consistent with the 1. The authority citation for part 679 the State could indeed fish in areas of Magnuson Act and other applicable continues to read as follows: Federal waters that the State has closed laws. Authority: 16 U.S.C. 773 et seq., 1801 et to State-registered vessels. However, The Federal waters off Alaska have seq. NMFS believes it is extremely unlikely been closed to scallop fishing under an 2. In § 679.1, paragraph (h) is revised that a vessel operator would chose to emergency interim rule and subsequent to read as follows: fish for scallops without registering with final rule since February 23, 1995 (60 the State. Many scallop beds straddle FR 11054, March 1, 1995 and 60 FR § 679.1 Purpose and scope. both State and Federal waters and a 42070, August 15, 1995, respectively). * * * * * vessel not registered with the State The management measures established (h) Fishery Management Plan for the would be prevented from fishing in under this final rule relieve this Scallop Fishery off Alaska. (1) State waters and could also be restriction by reopening Federal waters Regulations in this part govern prevented from entering State waters to fishing for scallops. Therefore, as this commercial fishing for scallops in the with unprocessed scallops on board. rule relieves a restriction, delayed Federal waters off Alaska by vessels of 38104 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations the United States (see subparts A and F Subpart FÐScallop Fishery Off Alaska projecting west from the southernmost of this part). tip of Cape Spencer and south of a line (2) State of Alaska laws that are in § 679.60 Gear and efficiency limits. projecting southwest from the addition to, and not in conflict with, the (a) General. Scallops may be taken westernmost tip of Cape Fairweather. regulations in this part are not only with dive gear or scallop dredge (c) Registration Area E (Prince preempted for vessels registered under gear as defined at § 679.2. William Sound) has as its western the laws of the State fishing for scallops (b) The inside ring diameter on all boundary the longitude of Cape in the Federal waters off Alaska. dredges used or carried by a vessel Fairfield (148°50′ W. long.), and its 3. In § 679.2 the definition of fishing for weathervane scallops eastern boundary the longitude of Cape ‘‘Authorized fishing gear’’ is amended (Patinopectin caurinus) must be 4 Suckling (143°53′ W. long.). by revising the introductory paragraph, inches (10.16 cm) or larger. (d) Registration Area H (Cook Inlet) redesignating paragraphs (1) through (9) (c) The inside ring diameter on all has as its eastern boundary the and (10) as paragraphs (2) through (10) dredges used or carried by a vessel longitude of Cape Fairfield (148°50′ W. and (12), respectively, and adding new fishing for scallops other than long.) and its southern boundary the paragraphs (1) and (11). New definitions weathervane scallops must be 3 inches latitude of Cape Douglas (58°52′ N. lat.). of ‘‘CBL’’ and ‘‘Shucking machine’’ are (7.62 cm) or larger. (1) Northern District. North of a line added, in alphabetical order, to read as (d) No person may use chafing gear or extending from Boulder Point at follows: other devices that decrease the legal 60°46′23′′ N. lat., to Shell Platform C, inside ring diameter of a scallop dredge. then to a point on the west shore at § 679.2 Definitions. (e) Except as provided in paragraph (f) 60°46′23′′ N. lat. of this section, no more than two scallop * * * * * (2) Central District. All waters dredges may be operated at one time Authorized fishing gear means dive, between a line extending from Boulder from a vessel, and the opening of a fixed gear, hook-and-line, jig, longline, Point at 60°46′23′′ N. lat., to Shell scallop dredge must be equal to or less longline pot, nonpelagic trawl, Platform C, to a point on the west shore than 15 ft (4.57 m) wide. nontrawl, pelagic trawl, pot-and-line, at 60°46′23′′ N. lat., and the latitude of (f) In the Kamishak, Southern, and scallop dredge, and trawl defined as Anchor Point Light (59°46′12′′ N. lat.). Central Districts of Scallop Registration follows: (3) Southern District. All waters Area H defined under § 679.61, no more (1) Dive means any scuba or surface enclosed by a line from Anchor Point than one scallop dredge may be supported diving equipment that allows Light west to 59°46′12′′ N. lat., 152°20′ operated at one time from a vessel, and for the underwater harvest of scallops W. long., then south to 59°03′25′′ N. lat., the opening of a dredge may not be by divers, or the taking of scallops by 152°20′ W. long., then in a northeasterly more than 6 ft (1.83 m) in width. means of such gear. direction to the tip of Cape Elizabeth at * * * * * (g) Scallops must be shucked by hand ° ′ ′′ ° ′ only. A shucking machine must not be 59 09 30 N. lat., 151 53 W. long., then (11) Scallop dredge means gear from the tip of Cape Elizabeth to the tip consisting of a mouth frame attached to on board a vessel that is fishing for ° ′ ′′ scallops or that has scallops on board. of Point Adam at 59 15 20 N. lat., a holding bag constructed of metal rings, 151°58′30′′ W. long. or any modification to this design that (h) No vessel fishing for scallops in Federal waters may have aboard more (4) Kamishak Bay District. All waters can be or is used in the harvest of enclosed by a line from 59°46′12′′ N. scallops, or the taking of scallops by than 12 persons, exclusive of ADF&G or ° ′ ′′ NMFS observers. lat., 153 00 30 W. long., then east to means of such gear. 59°46′12′′ N. lat., 152°20′ W. long., then * * * * * § 679.61 Registration areas. south to 59°03′25′′ N. lat., 152°20′ W. CBL means crab bycatch limit. For the purpose of managing the long., then southwesterly to Cape * * * * * scallop fishery, the Federal waters off Douglas (58°52′ N. lat.). The seaward Shucking machine means any Alaska and adjacent State waters are boundary of the Kamishak Bay District mechanical device that automatically divided into nine scallop registration is 3 nautical miles seaward from the removes the meat or the adductor areas. Three scallop registration areas shoreline between a point on the west muscle from the shell. are further subdivided into districts. shore of Cook Inlet at 59°46′12′′ N. lat., ° ′ ′′ * * * * * The scallop registration areas and 153 00 30 W. long., and Cape Douglas ° ′ ° ′ 4. In § 679.7, paragraph (h) is added districts are defined as follows: at 58 52 N. lat., 153 15 W. long., to read as follows: (a) Registration Area A (Southeastern) including a line three nautical miles has as its southern boundary the seaward from the shorelines of § 679.7 Prohibitions. international boundary at Dixon Augustine Island and Shaw Island, and * * * * * Entrance, and as its northern boundary including the line demarking all state (h) Scallop fishery off Alaska. It is Loran-C line 7960–Y–29590, which waters shown on NOAA chart 16640, unlawful for any person to violate any intersects the western tip of Cape 21st Ed., May 5, 1990 (Available from provision of subpart F of this part while Fairweather at 58°47′58′′ N. lat., Alaska Region). fishing for scallops in the Federal waters 137°56′30′′ W. long., except for ADF&G (5) Barren Island District. All waters off Alaska. District 16 defined under paragraph (b) enclosed by a line from Cape Douglas 5. Subpart F is revised to read as of this section. (58°52′ N. lat.) to the tip of Cape follows: (b) Registration Area D (Yakutat) has Elizabeth at 59°09′30′′ N. lat., 151°53′ ° ′ Subpart FÐScallop Fishery Off Alaska as its western boundary the longitude of W. long., then south to 58 52 N. lat., Cape Suckling (143°53′ W. long.), and as 151°53′ W. long., then west to Cape Sec. its southern boundary Loran-C line Douglas. 679.60 Gear and efficiency limits. 679.61 Registration areas. 7960–Y–29590, which intersects the (6) Outer District. All waters enclosed 679.62 General limitations. western tip of Cape Fairweather at by a line from the tip of Point Adam to 679.63 Inseason adjustments. 58°47′58′′ N. lat., 137°56′30′′ W. long., the tip of Cape Elizabeth, then south to 679.64 Seasons. and ADF&G District 16 defined as all 58°52′ N. lat., 151°53′ W. long., then east 679.65 Observer requirements. waters all waters north of a line to the longitude of Aligo Point Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38105

(149°44′33′′ W. long.), then north to the 171° W. long., to 55°30′ N. lat., 173°30′ C. opilio abundance in Registration Area tip of Aligo Point. E. long., as its northern boundary the Q. (7) Eastern District. All waters east of latitude of Point Hope (68°21′ N. lat.). (C) The CBL for C. bairdi Tanner crab the longitude of Aligo Point (149°44′33′′ (i) Registration Area R (Adak) has as caught while conducting any fishery for W. long.), west of the longitude of Cape its eastern boundary 171° W. long., and scallops is 0.13542 percent of the best Fairfield (148°50′ W. long.), and north of as its northern boundary 55°30′ N. lat. available estimate of C. bairdi 58°52′ N. lat. abundance in Registration Area Q. (e) Registration Area K (Kodiak) has as § 679.62 General limitations. (iv) Annual CBLs will be specified for its northern boundary the latitude of (a) Harvest limits—(1) General. NMFS the 12-month time period from July 1 Cape Douglas (58°52′ N lat.), and as its will establish TAC amounts and CBLs through June 30 of the following year. western boundary the longitude of Cape for the scallop fishery off Alaska An annual CBL may be utilized only for Kumlik (157°27′ W. long.). according to the procedures described the registration area or district specified, (1) Northeast District. All waters under this section. The total annual only if any applicable TAC amount is northeast of a line extending 168° from TAC amount for scallops off Alaska will available for harvest, only during the the easternmost tip of Cape Barnabas, be established within the OY range of 0 applicable season set out in § 679.64, east of a line from the northernmost tip to 1.8 million lb (0 to 815.5 mt) of and only if no closure or other of Inner Point to the southernmost tip of shucked scallop meat. limitation or restriction is applicable. Afognak Point, east of 152°30′ W. long. (2) TACs. (i) The annual TACs for (b) Specifications. The following in Shuyak Strait, and east of the scallops in each Registration Area or procedure is established for specifying longitude of the northernmost tip of part thereof will be established as a TAC amounts and CBLs: Shuyak Island (152°20′ W. long.). weight in pounds of shucked scallop (1) On an annual basis, prior to the (2) Southeast District. All waters meat based on a review of the following: April Council meeting, the Council will ° southwest of a line extending 168 from (A) Assessments of the biological distribute a summary of the State’s most the easternmost tip of Cape Barnabas condition of each scallop species. recent TAC and CBL recommendations ° and east of a line extending 222 from Assessments will include, where and supporting documentation to the the southernmost tip of Cape Trinity. practicable, updated estimates of MSY; public through its mailing list, as well (3) Southwest District. All waters west as provide copies of the ° historical catch trends and current catch of a line extending 222 from the statistics, reviews of alternative recommendations, documentation, and southernmost tip of Cape Trinity, south harvesting strategies; and relevant the annual SAFE report to the public of a line from the westernmost tip of information relating to changes in upon request. The Council will notify Cape Ikolik to the southernmost tip of scallop markets. the public of its intent to develop final Cape Kilokak and east of the longitude recommendations at the April Council ° ′ (B) Socioeconomic considerations that of Cape Kilokak (156 19 W. long.). are consistent with the goals and meeting and solicit public comment (4) Semidi Island District. All waters objectives of the FMP. both before and during the April west of the longitude of Cape Kilokak at (ii) Annual scallop TACs will be Council meeting. 156°19′ W. long. and east of the (2) Following the April Council specified for the 12-month time period longitude of Cape Kumlik at 157°27′ W. meeting, the Council will submit its extending from July 1 through June 30 long. TAC and CBL recommendations along of the following year. An annual TAC (5) Shelikof District. All waters north with rationale and supporting amount is available for harvest only for of a line from the westernmost tip of information to NMFS for review and the registration area or district specified, Cape Ikolik to the southernmost tip of implementation. Cape Kilokak, west of a line from the only during the applicable season set (3) As soon as practicable after northernmost tip of Inner Point to the out in § 679.64, and only if no closure receiving recommendations from the southernmost tip of Afognak Point, west or other restriction or limitation is Council, NMFS will publish in the of 152°30′ W. long., in Shuyak Strait, applicable. Federal Register annual specifications and west of the longitude of the (3) CBLs. (i) CBLs may be specified for of TAC amounts and CBLs for the northernmost tip of Shuyak Island red king crab and Tanner crab species succeeding 12-month period extending (152°20′ W. long.). for any registration area or district. from July 1 through June 30 of the (f) Registration Area M (Alaska (ii) Except as provided under following year. Peninsula) has as its eastern boundary paragraph (a)(3)(iii) of this section, (c) Closures. (1) If the Director, Alaska the longitude of Cape Kumlik (157°27′ annual CBLs will be based on the Region, NMFS, determines that a TAC W. long.), and its western boundary the biological condition of each crab or CBL specified under paragraphs (a) longitude of Scotch Cap Light. The species, historical bycatch rates in the and (b) of this section has been or will registration area also includes all waters scallop fishery, and other be reached, NMFS will publish of Bechevin Bay and Isanotski Strait socioeconomic considerations that are notification in the Federal Register south of a line from the easternmost tip consistent with the goals and objectives prohibiting the taking and retention of of Chunak Point to the westernmost tip of the FMP. scallops in the Federal waters of the of Cape Krenitzen. (iii) Annual CBLs in Registration Area registration area or district where the (g) Registration Area O (Dutch Harbor) Q will equal the following amounts: notification is applicable. has as its northern boundary the latitude (A) The CBL for red king crab caught (2) It is unlawful for any person to of Cape Sarichef (54°36′ N. lat.), as its while conducting any fishery for conduct any fishing for scallops eastern boundary the longitude of scallops will be specified within the contrary to the notification of closure Scotch Cap Light, and as its western range of 500 to 3,000 crab based on the issued pursuant to this paragraph. boundary 171° W. long., excluding the considerations listed in paragraph (d) Closed areas. It is unlawful for any waters of Statistical Area Q. (a)(3)(ii) of this section. person to dredge for scallops in any (h) Registration Area Q (Bering Sea) (B) The CBL for Chionoecetes opilio Federal waters off Alaska that are closed has as its southern boundary a line from Tanner crab caught while conducting to fishing with trawl gear or non pelagic Cape Sarichef (54°36′ N. lat.), to 54°36′ any fishery for scallops is 0.003176 trawl gear under § 679.22(a)(1)(i), N. lat., 171° W. long., to 55°30′ N. lat., percent of the best available estimate of (a)(2)(i), (a)(4), (a)(6), (a)(7) and (b). 38106 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

§ 679.63 Inseason adjustments. (b) Fishing for scallops in the Federal August 1 through 2400 hours, A.l.t., (a) Inseason adjustments may be waters of Scallop Registration Areas K, December 31, subject to the other issued by NMFS to implement the M, O, Q, and R is authorized from 1200 provisions of this part. Fishing for closure, extension, opening, or hours, A.l.t., July 1 through 1200 hours, scallops in the Federal waters of Scallop reopening of a season in all or part of A.l.t., February 15 of the following year, Registration Areas A and E is not a scallop registration area; and the subject to the other provisions of this authorized. adjustment of TAC amounts or CBLs. part. § 679.65 Observer requirements. (b) Determinations for any inseason (c) Fishing for scallops in the Federal adjustment authorized under paragraph waters of the Kamishak District of (a) Except as provided in paragraph (a) of this section must be consistent Scallop Registration Area H is (c) of this section, vessels must carry a with § 679.25(a)(2). authorized from 1200 hours, A.l.t., NMFS-certified or ADF&G-certified (c) Procedures for making inseason August 15 through 1200 hours, A.l.t., scallop observer at all times while adjustments are specified at § 679.25(c). October 31, subject to the other fishing for scallops in Federal waters. (d) It is unlawful for any person to provisions of this part. conduct any fishing for scallops (b) An operator of a vessel required to (d) (Applicable January 1, 1997) contrary to an inseason adjustment carry an observer must comply with all Fishing for scallops in the Federal issued pursuant to this section. safety and conduct requirements set out waters of Scallop Registration Areas A, at § 679.7(g). § 679.64 Seasons. D, and E is authorized from 1200 hours, A.l.t., January 10 through 2400 hours, (c) Vessels less than 80 ft (24.4 m) (a) Fishing for scallops in the Federal LOA are exempt from the requirements waters off Alaska is authorized from A.l.t., June 30, subject to the other provisions of this part. of this section while fishing for scallops 0001 hours, A.l.t., July 1, through 2400 in the Federal waters of Registration (e) (Applicable through December 31, hours, A.l.t., June 30, subject to the Area H. other provisions of this part, except as 1996) Fishing for scallops in the Federal provided in paragraphs (b) through (e) waters of Scallop Registration Area D is [FR Doc. 96–18666 Filed 7–18–96; 4:19 pm] of this section. authorized from 1200 hours, A.l.t., BILLING CODE 3510±22±P 38107

Proposed Rules Federal Register Vol. 61, No. 142

Tuesday, July 23, 1996

This section of the FEDERAL REGISTER safety, or State, local, or tribal Comments regarding this information contains notices to the public of the proposed governments or communities; collection requirement may be directed issuance of rules and regulations. The (3) Would not create a serious to the Office of Information and purpose of these notices is to give interested inconsistency or otherwise interfere Regulatory Affairs of OMB, Attention: persons an opportunity to participate in the with an action taken or planned by Desk Officer for the Foreign Agricultural rule making prior to the adoption of the final rules. another agency; Service, Washington, DC 20503. (4) Would not alter the budgetary Executive Order 12372 impact of entitlements, grants, user fees, DEPARTMENT OF AGRICULTURE or loan programs or rights and This proposed rule is not subject to obligations of recipients thereof; and the provisions of Executive Order 12372 Office of the Secretary (5) Would not raise novel legal or which requires intergovernmental policy issues arising out of legal consultation with state and local 7 CFR Part 20 mandates, the President’s priorities, or officials. See the Notice related to 7 CFR principles set forth in Executive Order Part 3015, subpart V, published at 46 FR Export Sales Reporting for 12866. 29115 (June 24, 1983). Sunflowerseed and Sunflowerseed Oil Regulatory Flexibility Act Executive Order 12988 AGENCY: Foreign Agricultural Service, This proposed rule has been reviewed The Administrator, Foreign USDA. under Executive Order 12988, Civil Agricultural Service, certifies that this ACTION: Notice of Proposed Rulemaking. Justice Reform. The proposed rule regulation will not have a significant would have preemptive effect with economic impact on a substantial SUMMARY: This proposed rule would add respect to any state or local laws, number of small entities. Although sunflowerseed and sunflowerseed oil to regulations, or policies which conflict the list of commodities subject to the many exporters of sunflowerseed and with such provisions or which export sales reporting requirements of 7 sunflowerseed oil are small business, otherwise impede their full CFR Part 20. the time and expense involved in implementation. The proposed rule complying with this proposed reporting DATES: Comments on the proposed rule, would not have retroactive effect. as well as on alternatives to this requirement is negligible. In addition, Administrative proceedings are not proposal, must be received on or before data reported under this regulation are required before parties may seek judicial September 23, 1996 to be assured of maintained as a part of the normal review. consideration. course of export contracting business activity. Background ADDRESSES: Comments must be sent to: A copy of this proposed rule has been Section 602 of the Agricultural Trade Export Sales Reporting Branch, Trade sent to the Chief Counsel, Office of and Economic Analysis Division, Room Act of 1978, as amended, requires the Advocacy, U.S. Small Business reporting of information pertaining to 5959—Stop 1025, Foreign Agricultural Administration. Service, U.S. Department of Agriculture, the export of certain specified agricultural commodities and other 1400 Independence Ave. SW., Paperwork Reduction Act agricultural commodities that may be Washington, DC 20250–1025. All This proposed rule involves the designated by the Secretary of written comments received will be collection of information. FAS uses Agriculture. These reporting available for public inspection at the Forms FAS–97, FAS–98, FAS–99, and requirements are implemented by the above address during business hours FAS–100 for this collection of Foreign Agricultural Service under from 8:00 a.m. to 5:00 p.m., Monday information. OMB has assigned control regulations codified at 7 CFR Part 20. through Friday. number 0551–0007 to these forms. The Individual reports collected under the FOR FURTHER INFORMATION CONTACT: Department intends to amend the exports sales reporting program are Thomas B. McDonald, Jr., Chief, Export current information collection approved confidential and are only to be released Sales Reporting Branch, Trade and by OMB expiring March 31, 1998. in compilation form each week Economic Analysis Division, Foreign Estimate of Burden: Public reporting following the week of reporting. Agricultural Service, U. S. Department burden for collecting information under Reporting under 7 CFR Part 20 is of Agriculture, (202) 720–3273, FAX this proposed rule is estimated to mandatory. Any person who knowingly (202) 690–3275. average 33 minutes per response, fails to make a report shall be fined not SUPPLEMENTARY INFORMATION: This including the time for reviewing more than $25,000 or imprisoned for not proposed rule is issued in conformance instructions, searching existing data more that 1 year, or both. with Executive Order 12866. Based on sources, gathering and maintaining the Previously, reports relating to information compiled by the data needed, and completing and sunflowerseed export sales have not Department, it has been determined that reviewing the collection of information. been required because of the limited this rule: Respondents: Business and other for- level of exports and the small size of the (1) Would have an annual effect on profit. industry. Recently, interested industry the economy of less than $100 million; Respondents: 30. representatives have suggested that (2) Would not adversely affect in a Estimated number of annual sunflowerseed and sunflowerseed oil material way the economy, a sector of Responses per Respondent: 51. exports are now of major importance to the economy, productivity, competition, Estimated total annual burden on the U. S. oilseeds and products jobs, the environment, public health or Respondents: 855 hours. industry. Between 30 to 35 percent of 38108 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules the confection seed production and thousand tons worth $130.5 million in Lists of Subjects in 7 CFR Part 20 between 60 to 70 percent of the oil calendar year 1994 and to 471.3 Agricultural commodities, Exports, production is exported. Sunflowerseed thousand tons valued at $299.5 million Reporting. activity was added to the Department’s in 1995. Accordingly, it is proposed to amend ‘‘World Agricultural Supply and The addition of sunflowerseed and Part 20 of 7 CFR as follows: Demand Estimates’’ report in April sunflowerseed oil under the mandatory 1. The authority citation for Part 20 1994. reporting program will provide more continues to read as follows: U. S. production of sunflowerseed is complete coverage of the oilseed export Authority: 7 U.S.C. 5712. estimated at 2.19 million metric tons in industry and additional high quality up- 2. Appendix 1 to 7 CFR Part 20 is 1994 and 1.82 million tons in 1995, to-date information required in making compared with an average for 1988/89– amended by adding the following lines export projections. These projections are after the line for ‘‘linseed oil, including 1992/93 of only 1.09 million tons. U. S. used by private industry as well as the exports of sunflowerseed increased to raw, boiled’’ under the indicated government in making economic column headings: 183.1 thousand tons valued at $79.4 decisions concerning the orderly flow of million during calendar year 1994 and U. S. agricultural commodities in the Appendix 1—Commodities Subject to to 296.0 thousand tons valued at $118.3 domestic and export markets. Reporting, Units of Measure to be Used million in 1995. U. S. exports of in Reporting, and Beginning and sunflowerseed oil rose to 208.6 Ending Dates of Marketing Years

Beginning of Commodity to be reported Unit of measure to be used in re- marketing End of mar- porting year keting year

******* Sunflowerseed ...... do ...... September 1 August 31. Sunflowerseed OilÐincluding: crude (including degummed), once refined, ...... do ...... October 1 ...... September sunflowerseed salad oil (including refined and further processed by 30. bleaching, deodorizing or winterizing), hydrogenated.

*******

Signed at Washington, D.C., July 10, 1996. are proposing several amendments to Please state that your comments refer to August Schumacher, Jr., the requirements for irradiation Docket No. 95–069–1. Comments Administrator, Foreign Agricultural Service. procedures and facilities and the received may be inspected at USDA, [FR Doc. 96–18468 Filed 7–22–96; 8:45 am] handling of treated and untreated fruits room 1141, South Building, 14th Street BILLING CODE 3410±10±P and vegetables. Finally, we are and Independence Avenue SW., proposing to amend the definition for Washington, DC, between 8 a.m. and inspector to include State plant 4:30 p.m., Monday through Friday, Animal and Plant Health Inspection regulatory officials designated by the except holidays. Persons wishing to Service Administrator of the Animal and Plant inspect comments are requested to call Health Inspection Service, U.S. ahead on (202) 690–2817 to facilitate 7 CFR Part 318 Department of Agriculture. These entry into the comment reading room. [Docket No. 95±069±1] proposed actions would facilitate the FOR FURTHER INFORMATION CONTACT: Mr. interstate movement of papayas, Peter M. Grosser, Senior Staff Officer, Papaya, Carambola, and Litchi From carambolas, and litchis from Hawaii Port Operations, PPQ, APHIS, 4700 Hawaii while continuing to provide protection River Road Unit 139, Riverdale, MD against the spread of injurious plant 20737–1236, (301) 734–8295. AGENCY: Animal and Plant Health pests from Hawaii to other parts of the Inspection Service, USDA. United States. SUPPLEMENTARY INFORMATION: ACTION: Proposed rule. DATES: For comments on all portions of Background SUMMARY: We are proposing to increase this proposed rule except the rule’s The Hawaiian Fruits and Vegetables the irradiation treatment dose required information collection and regulations, contained in 7 CFR 318.13 for papayas intended for interstate recordkeeping requirements that are through 318.13–17 (referred to below as movement from Hawaii and to allow subject to the Paperwork Reduction Act, the regulations), govern, among other carambolas and litchis to be moved consideration will be given only to things, the interstate movement of fruits interstate from Hawaii with irradiation comments received on or before August and vegetables, including papayas, from treatment. We are also proposing to 22, 1996. For comments on the Hawaii. Regulation is necessary to allow papayas, carambolas, and litchis Paperwork Reduction Act requirements prevent the spread of the Mediterranean from Hawaii to undergo irradiation of this proposed rule, consideration will fruit fly (Ceratitis capitata), the melon treatment either in Hawaii or in non- be given only to comments received on fly (Bactrocera cucurbitae), and the fruit fly supporting areas of the or before September 23, 1996. Oriental fruit fly (Bactrocera dorsalis), mainland United States. We are also ADDRESSES: Please send an original and which occur in Hawaii. These types of proposing to allow litchis to be moved three copies of your comments to fruit flies are collectively referred to in interstate from Hawaii if they are Docket No. 95–069–1, Regulatory this document as Trifly. inspected and found free of the litchi Analysis and Development, PPD, The regulations allow papayas to be fruit moth and undergo hot water APHIS, suite 3C03, 4700 River Road moved interstate from Hawaii to any treatment for fruit flies. In addition, we Unit 118, Riverdale, MD 20737–1238. destination in the United States if, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38109 among other things, they have been States on the mainland where treatment identification, scheduled process, treated for Trifly. One approved would be allowed because of either the evidence of compliance with the treatment for Trifly in papayas is relatively cool climate or the lack of scheduled process, ionizing energy irradiation. Section 318.13–4f provides suitable host material in those areas. source, source calibration, dosimetry, for irradiation of papayas at an Therefore, we are proposing to amend dose distribution in the product, and the approved facility in Hawaii at an the regulations at § 318.13–3 and date of irradiation. All records must be irradiation dose of 150 Gray (15 krad). 318.13–4f to allow untreated papayas available for inspection. from Hawaii to undergo irradiation In addition, we are proposing to Irradiation Dosage Levels treatment in the areas of the mainland amend § 318.13–4f to require that The Agricultural Research Service United States described above. approved irradiation treatment facilities (ARS), United States Department of We are also proposing to require that be certified annually by Plant Protection Agriculture, recently reevaluated the untreated papayas moved interstate and Quarantine (PPQ), APHIS, and that irradiation treatment for fruits and from Hawaii for treatment at an they be recertified in the event that an vegetables, including papayas, and has irradiation facility in an approved area increase or decrease in radioisotope or formally recommended a change from on the mainland United States be a major equipment modification affects 150 Gray to 250 Gray for the dose accompanied by a limited permit. The the delivered dose. This action would necessary to control Trifly. At the purpose of a limited permit is to allow ensure that irradiation facilities are current dosage levels, normal-appearing, movement, under certain restrictions, of capable of properly administering sterile adult pests may emerge after a commodity that may not otherwise be effective treatments. treatment. Although these insects authorized for movement. This Packaging Requirements cannot reproduce, the emergence of document provides a way to track the normal-appearing adults presents commodity and ensure that it moves We are proposing to amend specific problems for surveillance programs only as authorized. provisions regarding packaging and designed to intercept exotic insects, In addition, we are proposing to wrapping of papayas under § 318.13–4f because there is no practical way to prohibit the commingling of untreated to require that all treated papayas be distinguish an irradiated (sterile) insect papayas shipped from Hawaii to the packaged in pest-proof cartons to from an untreated one. ARS has mainland United States with other fruits protect them from re-infestation by determined that the 250 Gray (25 krad) and vegetables. This appears necessary Trifly. Then, to ensure that no cartons dosage would prevent adult emergence to prevent other commodities from are added to or removed from a pallet altogether, including the emergence of becoming infested with Trifly. load of cartons, pallet loads would have normal-appearing, sterile adult insects to be wrapped in one of the following Irradiation Procedures and Facilities capable of flight. ways, as is currently required under The Food and Drug Administration We are proposing to amend § 318.13– § 318.13–4f(b)(6): With polyethylene (FDA) regulations permit the use of 4f to eliminate the requirement that sheet wrap, with net wrapping, or with irradiation at doses not to exceed 1,000 dose indicators be attached to the strapping so that each carton on an Gray (100 krad) to inhibit the growth cartons or the pallet loads of treated outside row of the pallet load is and maturation of fresh foods and to papayas. Instead, we would require that constrained by a metal or plastic strap. disinfest food of arthropod pests. The absorbed dose be measured at the We further propose to require that pallet 250 Gray (25 krad) dosage treatment facility using a dose indicator loads of treated papayas be marked with recommended by ARS is well within that can accurately measure an absorbed treatment lot numbers, packing and FDA limits. We are therefore proposing dose of 250 Gray (25 krad). We would treatment facility identification and to amend § 318.13–4f by increasing the require that the number and placement locations, and dates of packing and irradiation treatment dose required for of dosimeters used to measure the treatment. This information would papayas intended for interstate absorbed dose be in accordance with allow an inspector to identify the movement from Hawaii from 150 Gray standards of the American Society for treatment lots and trace them back to (15 krad) to 250 Gray (25 krad). Testing and Materials (ASTM). (See the packing and treatment facilities. Designation E 1261–94, ‘‘Standard This method of labeling would replace Irradiation Treatment on the Mainland Guide for Selection and Calibration of the current requirement that individual Hawaii has not been able to ship Dosimetry Systems for Radiation cartons and pallet-loads of cartons be irradiated fresh papayas to the mainland Processing,’’ American Society for marked with a ‘‘Treated’’ stamp. under the existing regulations due to the Testing and Materials, Annual Book of We are not proposing similar lack of an irradiation facility in the ASTM Standards.) We would add that packaging requirements for untreated State. We believe that routine the dosimetry system (the system used papayas moving interstate to the commercial shipments of papayas can for determining absorbed dose, mainland United States. Any Trifly that be authorized for treatment in any State consisting of dosimeters, measurement might be present in the shipment of of the continental United States except instruments, reference standards, and untreated papayas would most likely be Alabama, Arizona, California, Florida, procedures) in place at the treatment eggs and larvae, and it is unlikely that Georgia, Kentucky, Louisiana, facility must demonstrate that the eggs and larvae could escape. If Trifly Mississippi, Nevada, New Mexico, absorbed dose, including areas of eggs and larvae were present in the North Carolina, South Carolina, minimum and maximum dose, is shipment, and if they reached maturity Tennessee, Texas, or Virginia. Prior to mapped, controlled, and recorded, and and escaped, it is unlikely that they treatment, movement into and through we would rely on the treatment facility could establish a reproducing the United States would be limited to records to verify the treatment. Under population in the areas in which the area authorized under § 318.13– the current regulations, the treatment movement of untreated papayas would 17(e) for fruits and vegetables from facility is required to maintain records be authorized under this section Hawaii that transit the United States en of treatment for a period of time that because of either the relatively cool route to a foreign destination. It is exceeds the shelf life of the irradiated climate or the lack of suitable host unlikely that Trifly would be able to product by 1 year. The regulations material in those areas. Further, establish reproducing populations in the require the records to include the lot untreated papayas would be treated on 38110 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules the mainland before being distributed, spp.) and other plant pests by an to inspect and certify to shippers and minimizing the possibility that any eggs inspector and then treated with hot other interested parties, as to the and larvae could reach maturity and water for the Mediterranean fruit fly and condition of the products inspected. To escape. Oriental fruit fly under the supervision be eligible for designation, a State plant of an inspector before the litchis’ regulatory official must have a Carambolas from Hawaii interstate movement. bachelor’s degree in the biological Carambola (Averrhoa carambola) fruit However, because the litchi rust mite sciences, a minimum of 2 years’ is a recorded host of Trifly. Based on cannot be effectively detected by experience in State plant regulatory ARS research and recommendations, 1 inspection and would not be eliminated activities, and a minimum of 2 years’ we are also proposing to amend by hot water treatment, we are experience in recognizing and § 318.13–4f to allow the interstate proposing that the litchi be prohibited identifying plant pests known to occur movement of carambolas from Hawaii movement into Florida. Accordingly, within Hawaii. Six years’ experience in with irradiation treatment. The same the cartons in which the litchi are State plant regulatory activities may be provisions proposed for papaya, packed would have to be stamped ‘‘Not substituted for the degree requirement.’’ including irradiation treatment dosage, for importation into or distribution in We believe that this proposed would apply. FL.’’ definition, which is based in part on the Litchis from Hawaii The provisions described above for definition for inspector found in 7 CFR litchi from Hawaii would be added to 353, ‘‘Phytosanitary Export Litchi (Litchi chinensis) fruit is a the regulations as a new § 318.13–4e. Certification,’’ would allow greater State recorded host of the Mediterranean fruit Research conducted by ARS indicates participation in the inspection process fly and Oriental fruit fly, among other that the following hot water treatment of while continuing to provide protection pests, but litchi is not a recorded host litchis would provide probit 9 against the spread of injurious plant for melon fly. Based on ARS research quarantine security (no more than 3 pests from Hawaii to other parts of the and recommendations, we are proposing individuals surviving from an estimated United States. to further amend § 318.13–4f to allow treatment population of 100,000 target) Miscellaneous the interstate movement of litchis from against any potential infestations of Hawaii with irradiation treatment. The Mediterranean fruit fly or Oriental fruit We are proposing to amend § 318.13– same provisions proposed for papaya, fly: 4f so that it permits irradiation including irradiation treatment dosage, treatment for certain fruits or vegetables, would apply. Water temperature Time not exclusively for papayas. Although We have determined, however, that papayas, carambolas, and litchis would irradiation treatment may not affect 49 °C (120.2 °F) or above 20 minutes. be the only commodities listed in other pests that may be carried by litchi. § 318.13–4f as being approved for this One pest, the litchi rust mite (Eriphyes Treatment would begin when the treatment, we expect that additional ° ° litchi), would not be easily detected by water temperature is 49 C (120.2 F) or fruits and vegetables from Hawaii may an inspector. Therefore, the entry of above in all locations throughout the be approved for irradiation treatment litchi from Hawaii into Florida, where tank; the tank must be designed to allow and added to this section through most mainland litchi is grown, would be sufficient water circulation and heating rulemaking in the future. prohibited as a precaution against the to maintain treatment temperatures We are also proposing to amend possible introduction of litchi rust mite. during the 20 minute treatment cycle. § 318.13–4f(c) to update the address for Accordingly, the cartons in which the Hot water treatment tanks with upper requests for approval and inspection of ° ° litchi are packed would have to be temperature limits of 49.5 C (121.1 F) irradiation facilies. stamped ‘‘Not for importation into or would be recommended, because This proposed rule would facilitate distribution in FL.’’ temperatures exceeding 49.5 °C (121.1 the interstate movement of papayas, Other pests that may be carried by the °F) could cause phytotoxicity damage carambolas, and litchis from Hawaii litchi, including the litchi fruit moth due to overheating. Hydrocooling for 20 while continuing to provide protection (Cryptophlebia spp.), could be easily minutes at temperatures of 24 °C (75.2 against the spread of injurious plant detected by inspection. We propose to °F) # 4 °C (7.2 °F) would also be pests from Hawaii to other parts of the require that the litchis be inspected by recommended to prevent injury to the United States. an inspector and found free of plant fruit from the hot water treatment. This pests prior to interstate movement treatment schedule for litchis from Executive Order 12866 and Regulatory under a limited permit. Hawaii would be added to the Plant Flexibility Act Allowing the interstate movement of Protection and Quarantine (PPQ) This proposed rule has been reviewed litchis from Hawaii under the Treatment Manual, which is under Executive Order 12866. For this conditions described above would incorporated into the regulations by action, the Office of Management and facilitate trade while continuing to reference at 7 CFR 300.1. Budget has waived its review process provide protection against the spread of required by Executive Order 12866. plant pests into other parts of the United Definition of Inspector In accordance with 5 U.S.C. 603, we States. We are proposing to amend the have performed an Initial Regulatory As an alternative to the irradiation definition of inspector in § 318.13–1 to Flexibility Analysis, which is set out treatment for litchi from Hawaii, we are enable a greater number of qualified below, regarding the impact of this proposing to allow the interstate people to perform inspections on, issue proposed rule on small entities. movement of litchis from Hawaii if the limited permits for, and certify fruits However, we do not currently have all litchis are inspected and found free of and vegetables moving interstate from the data necessary for a comprehensive the litchi fruit moth (Cryptophlebia Hawaii. We propose that the new analysis of the effects of this rule on definition define an inspector as ‘‘An small entities. Therefore, we are inviting 1 Information on this and other ARS research may employee of Plant Protection and be obtained by writing to Dr. Ken Vick, USDA, ARS, comments concerning potential effects. NPS, BARC-West, Building 005, Beltsville, MD Quarantine, or a State plant regulatory In particular, we are interested in 20705. official designated by the Administrator determining the number and kind of Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38111 small entities that may incur benefits or (valued at $10.9 million) in 1994. Most according to the Small Business costs from implementation of this of the imported papayas came from Administration’s size standards. proposed rule. Mexico (80 percent), Belize (9.6 In 1994, Hawaii produced only about In accordance with 7 U.S.C. 162, the percent), Jamaica (6.3 percent), and the 50,700 pounds of carambola, valued at Secretary of Agriculture is authorized to Dominican Republic (1.9 percent). The approximately $38,000, on 35 farms. promulgate regulations governing the United States exported 18.4 million The provisions proposed in this rule interstate movement of plants and plant pounds of fresh papayas (valued at concerning irradiation treatment of products from a State or territory of the $15.4 million) in 1994. The major carambola fruits by the mainland United States to prevent the spread of a importers were Japan (66.8 percent) and facilities are expected to stimulate dangerous plant disease or insect Canada (27.1 percent). Almost all growth of the carambola industry in infestation new to or not widely United States exports of papayas go out Hawaii and provide greater access to the prevalent or distributed within or of Hawaii, while all imports come into larger mainland market. throughout the United States. the mainland United States. No economic impact on mainland This proposed rule would increase There are five firms currently carambola growers is anticipated, since the irradiation treatment dose required operating nine papaya treatment the total Hawaii production of for papayas from Hawaii and allow facilities in the State of Hawaii. Four carambola is less than one percent of the irradiation treatment of carambolas and firms use the vapor-heat treatment mainland production. Therefore, even litchis from Hawaii. The proposed rule method and one uses the dry heat (or in the unlikely event that Hawaii could would also allow papayas, carambolas, high-temperature forced air) method. ship 100 percent of its production to the and litchis from Hawaii to undergo The total capacity of these treatment mainland, supply would only increase irradiation treatment in non-fruit fly chambers is 85,000 pounds per run. by less than one percent. However, supporting areas of the mainland United Both heat treatment methods have the mainland consumers would likely States. In addition, the proposed rule potential to damage the papayas. They benefit from increased seasonal and would allow litchis to be moved require the center of each papaya fruit regional availability, as well as from the interstate from Hawaii if they are to reach about 47 °C (about 117 °F), a increased variety of fresh carambola. inspected and found free of the litchi temperature sufficient to kill fruit fly Additionally, carambola growers in fruit moth and other plant pests and eggs and larvae. Because of variation in Hawaii would benefit from the then undergo hot water treatment for fruit size and ripeness, the papayas may opportunity to sell their product in a Medfly and Oriental fruit fly. Finally, not be uniformly heated. This may larger and more diverse market. the proposed rule would amend the result in the fruit becoming lumpy and This proposed rule would enable requirements for irradiation procedures losing flavor. For both methods, careful carambola from Hawaii to be irradiated and facilities and the handling of treated control of the uniformity of fruit size at an existing irradiation facility on the and untreated fruits and vegetables. and ripeness is necessary for effective mainland and is not expected to impose Economic impacts associated with this treatment. In addition, both methods additional costs on carambola producers rulemaking would largely be the result require between 4 and 6 hours of in Hawaii. We expect that carambola of untreated papayas, carambolas, or treatment. Efforts to speed up the producers in Hawaii would benefit from litchis being allowed to move to the process result in fruit which is either the proposed irradiation treatment mainland United States for irradiation scalded externally or hardened on the because this treatment could deliver treatment. inside. The cost of treatment for both better product quality, extended shelf methods ranges from 9 to 23 cents per life of the fruit, and cost effective Papayas pound. treatment of the fruit. However, the Papayas are produced commercially Although the regulations currently overall impact of the carambola on about 340 farms in Hawaii. Nearly 65 allow papayas to be treated by provisions of the proposed rule is percent of those farms are owned by irradiation in Hawaii, there are no expected to be insignificant. individuals whose major occupation is irradiation facilities in that State. not farming, while the balance are Allowing irradiation to be performed on Litchis operated by individuals whose major the mainland appears to be an attractive Litchis are produced commercially on occupation is farming. option. The subsequent diversion of 257 farms in Hawaii. In 1993, the Papaya farms with average annual untreated papayas from Hawaii to the United States produced about 770,000 revenues of less than $500,000 are mainland would likely result in loss of pounds of litchi. Of that total, considered small. All papaya farms in business to the existing vapor heat and approximately 85,000 pounds was Hawaii are therefore considered small. dry heat facilities. This could result in produced in Hawaii. In 1994, Hawaii produced 62 million lay-offs and possibly the shut-down of Litchi farms with average annual pounds of papaya (valued at $15 some of these facilities. However, if revenues of less than $500,000 are million). Fresh papaya comprised 56.2 papaya producers respond by producing considered small. All litchi farms in million pounds of this total. During that more papayas, continuing traditional Hawaii are considered small. year, Hawaii shipped about 37.8 million treatment for some and shipping others The litchi industry in Hawaii has pounds of papaya. Shipment of fresh for irradiation, this would not been constrained by the lack of an papaya to the mainland totaled about necessarily occur. approved treatment for fruit flies since 19.4 million pounds, and the remainder the cancellation of ethylene dibromide was exported to other countries. Of the Carambolas in 1994. Approving irradiation approximately 19.4 million pounds of The United States produced about 6 treatment of litchis on the mainland fresh papayas shipped from Hawaii to million pounds of carambola in 1994, would be expected to stimulate growth the mainland in 1994, most went to the with a total value of approximately $4 of the industry and provide access to the West Coast. Seventy five percent of million to $4.5 million. In the United larger mainland market. No information them were sold directly to retailers, and States, carambola is grown on about 100 is available on the effect of approving the rest were sold to wholesalers. farms. All of these farms have a market inspection and hot water treatment as The United States imported about value of less than $500,000 and are thus an alternative method for moving litchis 41.2 million pounds of fresh papaya considered to be small businesses interstate. 38112 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

The United States is a net importer of Executive Order 12372 and vegetables. These proposals would fresh litchi, with a total import of about This program/activity is listed in the facilitate the interstate movement of 165,000 pounds in 1994. In 1994, nearly Catalog of Federal Domestic Assistance papayas, carambolas, and litchis from 70 percent of imported litchi came from under No. 10.025 and is subject to Hawaii while continuing to provide Mexico; the remainder came from Israel. Executive Order 12372, which requires protection against the spread of Trifly The total supply of litchi on the intergovernmental consultation with from Hawaii to other parts of the United mainland is about 850,000 pounds. State and local officials. (See 7 CFR part States. Wholesale prices of litchi range between 3015, subpart V.) The implementation of these $1.00 per pound and $4.50 per pound. proposed regulatory actions would The economic impact on mainland Executive Order 12778 require us to engage in certain litchi growers and prices on the This proposed rule has been reviewed information collection activities that mainland will not be significant. Even under Executive Order 12778, Civil would necessitate the use of several in the unlikely event that Hawaii Justice Reform. If this proposed rule is forms, including limited permits and shipped 25 percent of its production to adopted: (1) All State and local laws and container markings. the mainland, supply would increase by regulations that are inconsistent with We are seeking OMB approval to use only about 2.3 percent. However, this rule will be preempted; (2) no the following forms: mainland consumers would benefit retroactive effect will be given to this PPQ Form 530 (Limited Permit): The from increased seasonal and regional rule; and (3) administrative proceedings proposed rule would require that availability, an increased variety of fresh will not be required before parties may untreated papayas moved interstate litchi, and stable prices. Additionally, file suit in court challenging this rule. from Hawaii for treatment at an litchi growers in Hawaii would benefit irradiation facility on the United States from the increased opportunity to sell Paperwork Reduction Act mainland be accompanied by a limited their product in a larger and more In accordance with section 3507(d) of permit. The permit would be issued by diverse market. the Paperwork Reduction Act of 1995 an inspector after the inspector According to recent research (44 U.S.C. 3501 et seq.), the information examines the shipment and determines conducted by the ARS, irradiation collection or recordkeeping that it has been prepared in compliance appears to be an effective treatment requirements included in this proposed with our regulations. option that does not require control of rule have been submitted for approval to Container Marking and Identity: The either fruit size or ripeness. Irradiation the Office of Management and Budget proposed rule would require that pallet typically requires only 40 minutes for (OMB). Please send written comments loads of irradiation-treated papayas be treatment. The irradiation method may to the Office of Information and marked (by irradiation facility personnel be more cost effective depending on Regulatory Affairs, OMB, Attention: or by the shipper) with treatment lot volume treated, because it costs only Desk Officer for APHIS, Washington, DC numbers, packing and treatment facility about 5 to 12 cents per pound. 20503. Please state that your comments identification and locations, and dates The proposed rule is expected to refer to Docket No. 95–069–1. Please of packing and treatment. This benefit producers, since irradiation send a copy of your comments to: (1) information would allow an inspector to appears to offer a number of advantages Docket No. 95–069–1, Regulatory identify the treatment lots and trace over current treatment options, Analysis and Development, PPD, them back to the packing and treatment including greater flexibility of fruit size APHIS, suite 3C03, 4700 River Road facilities. and ripeness, reduction in treatment Unit 118, Riverdale, MD 20737–1238, We are soliciting comments from the time, improved effectiveness against and (2) Clearance Officer, OIRM, USDA, public (as well as affected agencies) pest infestation, better product quality, room 404–W, 14th Street and concerning our proposed information extended shelf life, and improved cost Independence Avenue SW., collection and recordkeeping effectiveness. Consumers also could Washington, DC 20250. A comment to requirements. We need this outside benefit from a better quality product. OMB is best assured of having its full input to help us: The overall impact upon supply, price, effect if OMB receives it within 30 days (1) Evaluate whether the information and competitiveness is expected to be of publication of this proposed rule. collection is necessary for the proper insignificant. We are proposing to increase the performance of our agency’s functions, This proposed rule contains irradiation treatment dose required for including whether the information will paperwork requirements. Under this papayas intended for interstate have practical utility; proposed rule, a limited permit would movement from Hawaii and to allow (2) Evaluate the accuracy of our be required for untreated papayas, carambolas and litchis to be moved estimate of the burden of the proposed carambolas, and litchis moved interstate interstate from Hawaii with irradiation information collection, including the from Hawaii for irradiation. treatment. We are also proposing to validity of the methodology and The alternative to this proposed rule allow papayas, carambolas, and litchis assumptions used; would be to take no action. We do not from Hawaii to undergo irradiation (3) Enhance the quality, utility, and consider taking no action a reasonable treatment either in Hawaii or in non- clarity of the information to be alternative. Papayas, carambolas, and fruit fly supporting areas of the collected; and litchis are not currently moved mainland United States. We are also (4) Minimize the burden of the interstate from Hawaii because of a lack proposing to allow litchis to be moved information collection on those who are of suitable treatment options. This interstate from Hawaii if they are to respond, such as through the use of proposed rule would facilitate the inspected and found free of the litchi appropriate automated, electronic, interstate movement of papayas, fruit moth and undergo hot water mechanical, or other technological carambolas, and litchis from Hawaii treatment for fruit flies. In addition, we collection techniques or other forms of while continuing to provide protection are proposing several amendments to information technology, e.g., permitting against the spread of injurious plant the requirements for irradiation electronic submission of responses. pests from Hawaii to other parts of the procedures and facilities and the Estimate of burden: Public reporting United States. handling of treated and untreated fruits burden for this collection of information Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38113 is estimated to average 15 minutes per Inspector. An employee of Plant 7. Section 318.13–4f would be response. Protection and Quarantine, or a State amended as follows: Respondents: Importers, exporters, plant regulatory official designated by a. By revising the heading to read as and shippers. the Administrator to inspect and certify set forth below. Estimated number of respondents: to shippers and other interested parties, b. By revising paragraph (a) to read as 352. as to the condition of the products set forth below. Estimated number of responses per inspected. To be eligible for designation, c. By revising the heading and the respondent: 1. a State plant regulatory official must introductory text to paragraph (b) to Estimated total annual burden on have a bachelor’s degree in the read as set forth below. respondents: 88 hours. biological sciences, a minimum of 2 d. By revising paragraph (b)(1) to read Copies of this information collection years’ experience in State plant as set forth below. can be obtained from: Clearance Officer, regulatory activities, and a minimum of e. In paragraph (b)(2)(i), by removing OIRM, USDA, Room 404–W, 14th Street 2 years’ experience in recognizing and the words ‘‘15 kilorads (150 Gray) to the and Independence Ave., SW, identifying plant pests known to occur papayas’’ and adding ‘‘250 Gray (25 Washington, DC 20250. within Hawaii. Six years’ experience in krad)’’ in its place. State plant regulatory activities may be f. In paragraph (b)(2)(ii), by removing List of Subjects substituted for the degree requirement. the word ‘‘fruit’’ each time it appears 7 CFR Part 300 * * * * * and adding ‘‘fruits and vegetables’’ in its place. Incorporation by reference, Plant 5. In § 318.13–3, a new paragraph g. In paragraph (b)(2)(ii), at the end of diseases and pests, Quarantine. (b)(3) would be added to read as follows: the paragraph, by adding a new 7 CFR Part 318 sentence to read as set forth below. § 318.13±3 Conditions of movement. h. By adding a new paragraph Cotton, Cottonseeds, Fruits, Guam, (b)(2)(iv) to read as set forth below. Hawaii, Plant diseases and pests, Puerto * * * * * i. In paragraph (b)(4), in the first Rico, Quarantine, Transportation, (b) * * * sentence, by removing the words Vegetables, Virgin Islands. (3) Untreated fruits and vegetables from Hawaii may be moved interstate ‘‘Papayas are’’ and adding, in their Accordingly, 7 CFR parts 300 and 318 place, the words ‘‘Fruits and vegetables would be amended as follows: for irradiation treatment on the mainland United States if the provisions that are treated in Hawaii must be’’. of § 318.13–4f are met and if the fruits j. By redesignating the introductory PART 300ÐINCORPORATION BY text of paragraph (b)(4) as paragraph REFERENCE and vegetables are accompanied by a limited permit issued by an inspector in (b)(4)(i), and by adding new paragraphs 1. The authority citation would accordance with § 318.13–4(c). The (b)(4)(ii), (b)(4)(iii) and (iv) to read as set continue to read as follows: limited permit will be issued only if the forth below. k. By revising paragraphs (b)(5) and Authority: 7 U.S.C. 150ee, 154, 161, 162, inspector examines the shipment and and 167; 7 CFR 2.22, 2.80, and 371.2(c). determines that the shipment has been (b)(6) to read as set forth below. prepared in compliance with the l. By removing paragraphs (b)(7), 2. In § 300.1, paragraph (a), the provisions of this subpart. (b)(8), and (b)(9). introductory text would be revised to m. By adding a new paragraph (b)(7) read as follows: * * * * * to read as set forth below. 6. A new § 318.13–4e would be added n. By redesignating paragraph (b)(10) § 300.1 Materials Incorporated by to read as follows: reference; availability. as paragraph (b)(8). § 318.13±4e Administrative instructions o. In newly designated paragraph (a) Plant Protection and Quarantine (b)(8), the beginning of the second Treatment Manual. The Plant Protection governing the movement of litchis from Hawaii to other States. sentence, by removing the words ‘‘A and Quarantine Treatment Manual, (a) Litchis may be moved interstate papaya’’ and adding the word ‘‘An’’ in which was reprinted on November 30, their place. 1992, and includes all revisions through from Hawaii only in accordance with lllll this section or § 318.13–4f and all other p. By revising paragraph (c) to read as , has been approved for set forth below. incorporation by reference in 7 CFR applicable provisions of this part. (b) To be eligible for interstate q. In paragraph (d)(1), by removing chapter III by the Director of the Office the word ‘‘papaya’’ each time it appears. of the Federal Register in accordance movement under this section, litchi must be inspected and found free of the r. In paragraph (d)(2), by removing the with 5 U.S.C. 552(a) and 1 CFR part 51. words ‘‘a papaya’’ in the first sentence * * * * * litchi fruit moth (Cryptophlebia spp.) and other plant pests by an inspector and adding the word ‘‘an’’ in its place, and by removing the word ‘‘papaya’’ PART 318ÐHAWAIIAN AND and then treated for fruit flies under the each time it appears. TERRITORIAL QUARANTINE NOTICES supervision of an inspector with a treatment authorized by the s. In paragraph (e), by removing the 3. The authority citation for part 318 Administrator. word ‘‘papayas’’ and adding ‘‘the fruits would continue to read as follows: (c) Treatments authorized by the and vegetables authorized for treatment under this section’’ in its place. Authority: 7 U.S.C. 150bb, 150dd, 150ee, Administrator are listed in the Plant 150ff, 161, 162, 164a, and 167; 7 CFR 2.22, Protection and Quarantine Treatment § 318.13±4f Administrative instructions 2.80, and 371.2(c). Manual, which is incorporated by prescribing methods for irradiation 4. In § 318.13–1, the definition for reference at § 300.1 of this chapter. treatment of certain fruits and vegetables Inspector would be revised to read as (d) Litchi from Hawaii may not be from Hawaii. follows: moved interstate into Florida. All (a) Approved irradiation treatment. cartons in which litchi from Hawaii are Irradiation, carried out in accordance § 318.13±1 Definitions. packed must be stamped ‘‘Not for with the provisions of this section, is * * * * * importation into or distribution in FL.’’ approved as a treatment for the 38114 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules following fruits and vegetables: (iv) Litchi from Hawaii may not be DEPARTMENT OF THE TREASURY carambola, litchi, and papaya. moved interstate into Florida. All (b) Conditions of movement. Fruits cartons in which litchi from Hawaii are Office of Thrift Supervision and vegetables from Hawaii may be packed must be stamped ‘‘Not for authorized for movement in accordance importation into or distribution in FL.’’ 12 CFR Parts 502, 516, 562, 563, 565, 574 with this section only if the following (5) Dosage. The fruits and vegetables conditions are met: must receive a minimum absorbed [No. 96±69] (1) Location. The irradiation treatment ionizing radiation dose of 250 Gray (25 must be carried out at an approved RIN 1550±AA99 krad).5 facility in Hawaii or on the mainland Regulatory Citations to Uniform (6) Dosimetry systems. (i) Dosimetry United States. Fruits and vegetables Financial Institutions Rating System authorized under this section for must demonstrate that the absorbed treatment on the mainland may be dose, including areas of minimum and AGENCY: Office of Thrift Supervision, treated in any State on the mainland maximum dose, is mapped, controlled, Treasury (OTS). United States except Alabama, Arizona, and recorded. ACTION: Notice of proposed rulemaking. California, Florida, Georgia, Kentucky, (ii) Absorbed dose must be measured SUMMARY: In a related document Louisiana, Mississippi, Nevada, New using a dose indicator that can published in the July 18, 1996 issue of Mexico, North Carolina, South Carolina, accurately measure an absorbed dose of the Federal Register, the Federal Tennessee, Texas, or Virginia. Prior to 250 Gray (25 krad). treatment, the fruits and vegetables may Financial Institutions Examination not move into or through Alabama, (iii) The number and placement of Council (FFIEC) requested comment on Arizona, California, Florida, Georgia, dosimeters used must be in accordance proposed changes to the Uniform with American Society for Testing and Financial Institutions Rating System Kentucky, Louisiana, Mississippi, 6 Nevada, New Mexico, North Carolina, Materials (ASTM) standards. (UFIRS). In this document, the OTS is South Carolina, Tennessee, Texas, or (7)(i) Certification on basis of proposing to make conforming changes Virginia, except that movement would treatment. A certificate shall be issued to its regulations that cross-reference the be allowed through Dallas/Fort Worth, by an inspector for the movement of UFIRS. The effect of these changes will Texas, as an authorized stop for air fruits and vegetables from Hawaii that be to confirm that OTS regulations are cargo, or as a transloading location for have been treated and handled in intended to refer to the UFIRS as revised shipments that arrive by air but that are accordance with this section. from time to time. DATES: Comments must be received on subsequently transloaded into trucks for (ii) Limited permit. A limited permit or before September 23, 1996. overland movement from Dallas/Fort shall be issued by an inspector for the Worth into an authorized State by the interstate movement of untreated fruits ADDRESSES: Send comments to Manager, shortest route. and vegetables from Hawaii for Dissemination Branch, Records * * * * * treatment on the mainland United States Management and Information Policy, (2) * * * in accordance with this section. Office of Thrift Supervision, 1700 G (ii) * * * Untreated fruits and Street, NW., Washington, DC 20552, * * * * * vegetables shipped to the mainland Attention Docket No. 96–69. These United States from Hawaii in (c) Request for approval and submissions may also be hand-delivered accordance with this section may not be inspection of facility. Persons requesting to 1700 G Street, NW., from 9 a.m. to 5 packaged for shipment in a carton with approval of an irradiation treatment p.m. on business days or may be sent by treated fruits and vegetables. facility and treatment protocol must facsimile transmission to FAX Number * * * * * submit the request for approval in (202) 906–7755. Comments will be (iv) Be certified by Plant Protection writing to the Animal and Plant Health available for inspection at 1700 G Street, and Quarantine for initial use and Inspection Service, Plant Protection and NW., from 9 a.m. until 4 p.m. on annually for subsequent use. Quarantine, Oxford Plant Protection business days. Recertification is required in the event Center, 901 Hillsboro St., Oxford, NC FOR FURTHER INFORMATION CONTACT: that an increase or decrease in 27565. Before the Administrator William J. Magrini, Senior Project radioisotope or a major modification to determines whether an irradiation Manager, Supervision Policy, (202) 906– equipment that affects the delivered facility is eligible for approval, an 5744, Karen Osterloh, Counsel (Banking dose. Recertification may be required in inspector will make a personal & Finance), Regulations and Legislation cases where a significant variance in inspection of the facility to determine Division, (202) 906–6639 or Deborah dose delivery is indicated. whether it complies with the standards Dakin, Assistant Chief Counsel, (202) * * * * * of paragraph (b)(2) of this section. 906–6445, Regulations and Legislation (4) * * * * * * * * Division, Chief Counsel’s Office, Office (ii) The pallet-load of cartons must be Done in Washington, DC, this 16th day of of Thrift Supervision, 1700 G Street, wrapped before it leaves the irradiation July 1996. NW., Washington, DC 20552. facility in one of the following ways: A. Strating, SUPPLEMENTARY INFORMATION: (A) With polyethylene sheet wrap; Acting Administrator, Animal and Plant I. Proposal (B) With net wrapping; or Health Inspection Service. (C) With strapping so that each carton [FR Doc. 96–18461 Filed 7–22–96; 8:45 am] The UFIRS is a supervisory rating on an outside row of the pallet load is system used by the OTS and other constrained by a metal or plastic strap. BILLING CODE 3410±34±P agencies represented on FFIEC to (iii) Packaging must be labeled with evaluate the soundness of depository treatment lot numbers, packing and 5 See footnote 2. institutions on a uniform basis. The 6 Designation E, ‘‘Standard Guide for Selection treatment facility identification and and Calibration of Dosimetry Systems for Radiation agencies have implemented the UFIRS location, and dates of packing and Processing,’’ American Society for Testing and through CAMEL ratings. Under CAMEL, treatment. Materials, Annual Book of ASTM Standards. the agencies have organized the relevant Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38115

UFIRS factors into five major areas rating system that the OTS may adopt in promulgating a rule. As discussed in the (Capital Adequacy, Asset Quality, lieu of UFIRS. preamble, this proposed rule Management, Earnings, and Liquidity). Two other minor changes are also incorporates appropriate citations to the FFIEC has proposed changes to the being proposed. First, for the sake of revised Uniform Financial Institutions UFIRS system that: reformat and clarify consistency and to prevent confusion, Rating System proposed by the Federal the rating descriptions; add a sixth each regulation cross referencing UFIRS Financial Institutions Examination rating area addressing sensitivity to will indicate that the OTS will use the Council. The revisions will merely market risk; emphasize risk most recent rating (as determined either reduce confusion by updating the management processes; and make other on-site or off-site by the most recent terminology used in the OTS regulations changes. Currently, market risk is examination) of which the savings to reflect the current rating system. The evaluated within other rating areas. association has been notified in writing. OTS has determined that the proposed Currently, some of the cited regulations rule will not result in expenditures by Under current OTS regulations, include this provision, while others do state, local, or tribal governments or by ratings are used: (1) To define ‘‘troubled not. Additionally, the OTS proposes to the private sector of $100 million or savings association’’ for purposes of the clarify 12 CFR 562.4. Currently, that more. Accordingly, a budgetary impact OTS assessment system, 12 CFR 502.1; regulation requires, inter alia, all statement is not required under section (2) to determine if a savings association institutions receiving a rating of 3, 4 or 202 of the Unfunded Mandates Act of is eligible for expedited or standard 5 to obtain an independent audit. 1995. treatment under the application However, the Director of the OTS is processing guidelines, 12 CFR Part 516; authorized to waive the independent V. Regulatory Flexibility Act Analysis (3) to determine when an independent audit requirement for these institutions, Pursuant to section 605(b) of the audit is required for safety and if the Director ‘‘determines that an audit Regulatory Flexibility Act, the OTS soundness purposes and to determine would not address the safety and certifies that this proposed rule will not whether the Director may waive this soundness issues that caused the [low] have a significant economic impact on independent audit requirement, 12 CFR examination rating.’’ To be more a substantial number of small entities. 562.4; (4) to determine when the OTS precise, the OTS proposes to state that The OTS does not anticipate that the may require a savings association and a waiver may be granted if an audit application of the revised UFIRS rating its subsidiaries to provide notification ‘‘would not provide further information system will result in a change in before entering into transactions with on safety and soundness issues relevant composite ratings assigned to depository affiliates, 12 CFR 563.41; (5) to define to the examination rating.’’ institutions. Today’s proposed rule will ‘‘eligible savings association’’ for the The OTS request comments on all merely reduce confusion by updating purposes of exempting loans to small aspects of this aspects of this proposal. the terminology used in the OTS regulations to reflect the current rating and medium size businesses and farms II. Reporting and Recordkeeping system. from recordkeeping requirements, 12 Requirements 1 CFR 563.170(c)(10); (6) to define List of Subjects ‘‘adequately capitalized’’ and Reporting and recordkeeping ‘‘undercapitalized’’ under the prompt requirements in this proposed rule are 12 CFR Part 502 currently found in 12 CFR 563.41(e), corrective action regulation, 12 CFR Part Assessments, Federal home loan 563.170(c), and 574.9. These 565; (7) to determine whether a savings banks, Reporting and recordkeeping requirements are addressed in the association should be reclassified based requirements, Savings associations. on supervisory criteria other than following OMB approved packages: Control Nos. 1550–0011, 1550–0083, 12 CFR Part 516 capital for the purposes of the prompt and 1550–0032. The reporting burden corrective action regulation; and (8) to Administrative practice and under these packages remains define a savings association in ‘‘troubled procedure, Reporting and recordkeeping unchanged under the rule. condition’’ under rules requiring prior requirements, Savings associations. notice of the addition of any individual III. Executive Order 12866 12 CFR Part 562 to the board of directors or the The Director of the OTS has Accounting, Reporting and employment of any individual as senior determined that this proposed rule does executive officer, 12 CFR 574.9.2 Most of recordkeeping requirements, Savings not constitute a ‘‘significant regulatory associations. these regulations currently refer to action’’ for the purposes of Executive ‘‘CAMEL’’ ratings. Under the proposed Order 12866. 12 CFR Part 563 changes to UFIRS, the ‘‘CAMEL’’ IV. Unfunded Mandates Act of 1995 Accounting, Advertising, Crime, acronym will become obsolete. Currency, Flood insurance, Investments, Accordingly, the OTS is proposing to Section 202 of the Unfunded Mortgages, Reporting and recordkeeping revise its regulations to refer more Mandates Reform Act of 1995, Public requirements, Savings associations, generally to the UFIRS as it may exist Law 104–4 (Unfunded Mandates Act), Securities, Surety bonds. from time to time or to any comparable requires that an agency prepare a budgetary impact statement before 12 CFR Part 565 1 In January 17, 1996, the OTS proposed to promulgating a rule includes a federal Administrative practice and substantially revise 12 CFR 563.170(c) in a way that mandate that may result in expenditure procedure, Capital, Savings would remove paragraph (c)(10). 61 FR 1162 (Jan. by state, local, and tribal governments, 17, 1996). If that proposed amendment is adopted, associations. in the aggregate, or by the private sector, it will supersede the amendment proposed here. 12 CFR Part 574 2 The OTS previously proposed a revision to the of $100 million or more in any one year. capital distributions regulation at 12 CFR 563.134 If a budgetary impact statement is Administrative practice and that would define ‘‘troubled condition’’ by required, Section 205 of the Unfunded procedure, Holding companies, reference to the examination rating system. 59 FR 62356 (Dec. 5, 1994). When that regulation is Mandates Act also requires an agency to Reporting and recordkeeping finalized, it will also include appropriate references identify and consider a reasonable requirements, Savings associations, to the revised UFIRS system. number of regulatory alternatives before Securities. 38116 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Authority and Issuance PART 562ÐREGULATORY and has obtained written permission Accordingly, the Office of Thrift REPORTING STANDARDS from the Regional Director to employ this exemption. Supervision proposes to amend chapter 5. The authority citation for part 562 V, title 12, Code of Federal Regulations, continues to read as follows: * * * * * as set forth below. Authority: 12 U.S.C. 1463. PART 565ÐPROMPT CORRECTIVE PART 502ÐASSESSMENTS 6. Section 562.4 is amended by ACTION revising paragraphs (b)(1) and (c )(2) to 10. The authority citation for part 565 1. The authority citation for part 502 read as follows: is revised to read as follows: continues to read as follows: § 562.4 Audit of savings associations and Authority: 12 U.S.C. 1462a, 1463, 1467, Authority: 12 U.S.C. 1831o. savings association holding companies. 1467a. * * * * * 11. Section 565.4 is amended by 2. Section 502.1 is amended by (b) * * * revising paragraphs (b)(2)(iii)(B), revising paragraph (f) to read as follows: (1) If a savings association has (b)(3)(iii)(B), and (c)(2) to read as follows: § 502.1 Asset-based assessments. received a composite rating of 3, 4 or 5, as defined at § 516.3(c) of this chapter; § 565.4 Capital measures and capital * * * * * or (f) Definition. For purposes of this category definitions. section only, a troubled savings * * * * * * * * * * (c ) * * * association shall be defined as a savings (2) The Director may waive the (b) * * * association with a composite rating of 4 independent audit requirement (2) * * * or 5, as defined in § 516.3(c) of this described in paragraph (b)(1) of this (iii) * * * chapter. A troubled savings institution section, if the Director determines that (B) A leverage ratio of 3.0 percent or also includes a savings association in an audit would not provide further greater if the savings association is conservatorship so long as the information on safety and soundness assigned a composite rating of 1, as association requires increased issues relevant to the examination defined in § 516.3(c) of this chapter; and supervision and examination by the rating. Office. * * * * * * * * * * * * * * * (3) * * * PART 563ÐOPERATIONS (iii)(A) * * * PART 516ÐAPPLICATION (B) Has a leverage ratio that is less PROCESSING GUIDELINES AND 7. The authority citation for part 563 than 3.0 percent if the savings PROCEDURES continues to read as follows: association is assigned a composite rating of 1, as defined in § 516.3(c) of 3. The authority citation for part 516 Authority: 12 U.S.C. 375b, 1462, 1462a, 1463, 1464, 1467a, 1468, 1817, 1828, 3806; this chapter. continues to read as follows: 42 U.S.C. 4106. * * * * * Authority: 5 U.S.C. 552, 559; 12 U.S.C. 8. Section 563.41 is amended by (c) * * * 1462a, 1463, 1464. revising paragraph (e)(2)(ii)(A) to read as (2) Unsafe or unsound practice. The 4. Section 516.3 is amended by follows: OTS has determined, after notice and an revising paragraphs (a)(1)(i), (b)(1)(i), opportunity for hearing pursuant to and (c) to read as follows: § 563.41 Loans and other transactions with affiliates and subsidiaries. § 565.8(a), that the savings association received, and has not corrected, a less- § 516.3 Definitions. * * * * * than-satisfactory rating for any rating (a) * * * (e) * * * (2) * * * category (other than in a rating category (1) * * * specifically addressing capital (i) The savings association has a (ii) * * * (A) Has a composite rating of 4 or 5, adequacy) under the Uniform Financial composite rating of 1 or 2; as defined in § 516.3(c) of this chapter; Institutions Rating System (For * * * * * * * * * * availability, see § 516.1 of this chapter.), (b) * * * 9. Section 563.170 is amended by or an equivalent rating under a (1) * * * revising paragraph (c)(10)(i)(B) to read comparable rating system adopted by (i) The savings association has a as follows: the OTS. Ratings under this paragraph composite rating of 3, 4 or 5; (c)(2) refer to the most recent ratings (as * * * * * § 563.170 Examinations and audits; determined either on-site or off-site by (c) Composite rating. Composite rating appraisals; establishment and maintenance the most recent examination) of which of records. means the composite numerical rating the savings association has been notified assigned to the savings association by * * * * * in writing. the OTS under the Uniform Financial (c) * * * (10) * * * PART 574ÐACQUISITION OF Institutions Rating System (For (i) * * * availability, see § 516.1.) or an CONTROL OF SAVINGS (B) Eligible savings association means ASSOCIATIONS equivalent rating under a comparable any savings association that is well- or rating system adopted by the OTS, and adequately capitalized, as defined in 12. The authority citation for part 574 refers to the most recent rating (as part 565 of this chapter and was either: continues to read as follows: determined either on-site or off-site by (1) Assigned a composite rating of 1 Authority: 12 U.S.C. 1467a, 1817, 1831i. the most recent examination) of which or 2, as defined in § 516.3(c) of this the savings association has been notified chapter; or 13. Section 574.9 is amended by in writing. (2) Assigned a composite rating of 3, revising paragraph (a)(5)(i)(A) to read as * * * * * as defined in § 516.3(c) of this chapter, follows: Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38117

§ 574.9 Additions of directors and above address, telephone: (703) 518– must comply with Part 704, unless there employment of senior executive officers of 6640, or E-mail: [email protected]; or is a specific provision to the contrary in savings associations and savings and loan Edward Dupcak, Director, Office of Section 704.19. Thus, a wholesale holding companies. Investment Services, at the above corporate credit union that wishes to (a) * * * address, telephone: (703) 518–6620, or have access to the broader investment (5) * * * E-mail: [email protected]. powers of Appendix B of the May (i) * * * proposal must meet the general SUPPLEMENTARY INFORMATION: (A) Has a composite rating of 4 or 5, requirements of that proposal, except as as defined in § 516.3(c) of this chapter; Background modified by Appendices B and C and * * * * * On May 22, 1996, NCUA issued a proposed Section 704.19. For a Dated: July 9, 1996. proposed rule to revise the regulations wholesale corporate credit union, where By the Office of Thrift Supervision. for corporate credit unions. 61 FR 28085 Section 704.19 conflicts with Jonathan L. Fiechter, (June 4, 1996). The comment period Appendices B or C, Section 704.19 Acting Director. expires on September 3, 1996. The prevails. For example, Section 704.3(b)(1) of [FR Doc. 96–18565 Filed 7–22–96; 8:45 am] proposal sets forth requirements and the May proposal contains a general BILLING CODE 6720±01±P authorities that would apply to all requirement that a corporate credit corporate credit unions, and then union maintain a capital ratio of 4 provides, through appendices, percent. To engage in Part II authorities, NATIONAL CREDIT UNION additional requirements and authorities though, a 6 percent ratio is required. For ADMINISTRATION for those corporate credit unions that a wholesale corporate credit union, have more developed infrastructures however, proposed Section 704.19(b)(1) 12 CFR Part 704 and more experienced staffs. Currently, requires only a 5 percent ratio. This is the credit union system supports one Corporate Credit Unions partly justified by proposed Section ‘‘wholesale’’ corporate credit union, 704.19(c), which establishes a narrower AGENCY: National Credit Union which is a corporate credit union that limit for risk taking than is available to Administration (NCUA). serves corporate credit unions. It was other corporate credit unions with Part expected that this wholesale corporate ACTION: Proposed rule. II authority. It is also justified because credit union would seek to obtain the of the membership of a wholesale SUMMARY: NCUA recently issued a authorities available under Appendix B corporate credit union. Senior managers proposed rule to revise the regulations of the proposed rule. It was also of corporate credit unions have governing corporate credit unions. At expected that certain adjustments to the specialized expertise in the areas of the time the proposal was released, general requirements and the investments and asset and liability NCUA indicated that special requirements of Appendix B would management. NCUA believes that consideration would have to be have to be made to allow the wholesale corporate credit union managers, as provided for wholesale corporate credit corporate credit union to fulfill its role members and board representatives, will unions, due to their unique role in the as an ultimate liquidity provider to the analyze and question the balance sheet credit union system. NCUA and the one system. strength and financial activities of the wholesale corporate credit union that NCUA and the wholesale corporate wholesale corporate credit union, currently exists have worked together to credit union have worked closely on keeping its risk-taking in check. Finally, develop this proposal, which provides these adjustments, pending adoption of the lower ratio is justified because a for such consideration. This proposal final revised rules governing corporate wholesale corporate credit union has a would amend the regulations on credit unions. For several reasons, greater capacity to raise paid-in capital corporate credit unions by adding a new NCUA has determined to incorporate from non-credit union sources if the section, to follow the numbering of the these adjustments into the proposed need arises. recent proposal, governing wholesale revisions to Part 704. First, the Section 704.3(b)(2) of the May corporate credit unions. Final wholesale corporate credit union should proposal provides that a corporate credit provisions governing wholesale have the assurance that, once these union’s monthly reserve transfers are corporate credit unions, as well as other adjustments are made final, it will based upon the level of its reserve ratio, corporate credit unions, will be adopted remain entitled to them, unless the which is calculated by dividing the after consideration of public comments. regulation is changed. Second, the institution’s moving daily average net importance of the wholesale corporate assets into the total of its reserves and DATES: Comments must be received on credit union to the entire credit union undivided earnings plus paid-in capital. or before September 3, 1996. system warrants public comment on the Where the reserve ratio is greater than ADDRESSES: Comments should be adjustments. Further, the adjustments or equal to 3 percent but less than 4 directed to Becky Baker, Secretary of the should be standardized in the event percent, the corporate credit union must Board. Mail or hand-deliver comments other corporate credit unions wish to transfer .10 percent of its moving daily to: National Credit Union become wholesale corporate credit average net assets. Where the reserve Administration, 1775 Duke Street, unions. Accordingly, this proposed rule ratio is less than 3 percent, the corporate Alexandria, Virginia 22314–3428. Fax adds a new Section 704.19 governing credit union must transfer .15 percent of comments to (703) 518–6319. Post wholesale corporate credit unions. its moving daily average net assets. The comments on NCUA’s electronic Public comment is requested. Final amount to be transferred must be bulletin board by dialing (703) 518– action on this proposal will coincide calculated monthly, but the funds may 6480. E-mail comments to with final action on the broader come out of earnings for the quarter. [email protected]. Please send proposed Part 704. This formula is maintained even for a comments by one method only. corporate credit union operating with Analysis FOR FURTHER INFORMATION CONTACT: Part II authorities. Robert F. Schafer, Acting Director, Proposed Section 704.19(a) provides Proposed Section 704.19(b)(2), Office of Corporate Credit Unions, at the that wholesale corporate credit unions however, allows a wholesale corporate 38118 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules credit union to make reserve transfers at provide liquidity to the credit union federally insured corporate credit the lesser of .10 percent of its moving system. unions. NCUA, pursuant to Executive daily average net assets or the amount, Order 12612, has determined that this Regulatory Procedures depending on its reserve ratio, that rule may have an occasional direct would be required under Section Regulatory Flexibility Act effect on the states, on the relationship 704.3(c). A lower requirement is The NCUA Board certifies that the between the national government and appropriate to provide competitive proposed rule, if made final, will not the states, or on the distribution of wholesale corporate credit union have a significant economic impact on power and responsibilities among the services. Proposed 704.19(b)(2) also small credit unions (those under $1 various levels of government and the provides that reserve transfers may be million in assets). states, or on the distribution of power made from earnings in either the prior and responsibilities among the various calendar month or prior twelve- month Paperwork Reduction Act levels of government. However, the period. It may be necessary for a The paperwork requirements of this potential risk to the NCUSIF without wholesale corporate credit union to proposed rule are incorporated in the these changes justifies them. utilize the earnings accumulated over a requirements set forth in a proposed year, rather than just a quarter, to List of Subjects in 12 CFR Part 704 rule issued by NCUA on May 22, 1996. balance occasional short-term losses 61 FR 28085 (June 4, 1996). NCUA Credit unions, Reporting and with overall long-term gain. recordkeeping requirements. Section 704.8(e)(1) of the May invites comment on: (1) whether the collection of the information is By the National Credit Union proposal requires a corporate credit Administration Board on July 16, 1996. union to evaluate the risk in its balance necessary for the proper performance of Becky Baker, sheet by measuring, at least quarterly, the functions of NCUA, including the impact of a 300 basis point interest whether the information will have Secretary of the Board. rate shock. A corporate credit union practical utility; (2) the accuracy of For the reasons set forth in the must structure its balance sheet so that NCUA’s estimate of the burden of the preamble, NCUA proposes to amend 12 its after-shock MVPE ratio does not fall collection of information; (3) ways to CFR Part 704, as proposed to be revised below 1 percent. If the ratio falls below enhance the quality, utility, and clarity at 61 FR 28098, June 4, 1996, as follows: 2 percent, the corporate credit union of the information to be collected; and must conduct the tests monthly. Section (4) ways to minimize the burden of PART 704ÐCORPORATE CREDIT 704.8(e)(2) of the May proposal provides collection of information. Comments on UNIONS that a corporate credit union must limit the collection of information should be directed to Ms. Beauchesne, at the 1. The authority citation for part 704 its risk exposure to levels that do not continues to read as follows: result in an after-shock decline in MVPE National Credit Union Administration, of more than 18 percent. Pursuant to 1775 Duke Street, Alexandria, Virginia Authority: 12 U.S.C. 1762, 1766(a), 1781, Appendix B, a corporate credit union 22314–3428; Fax No. (703) 518–6433; E- and 1789. with Part II authorities may structure its Mail Address: [email protected], by 2. Section 704.19 is added to read as balance sheet so that its MVPE declines September 3, 1996. Comments should follows: as much as 50 percent after a 300 basis also be sent to the OMB Desk Officer at point shock. the following address: Mr. Milo § 704.19 Wholesale corporate credit Proposed Section 704.19(c) permits a Sunderhauf, OMB Reports Management unions. wholesale corporate credit union’s after- Branch, New Executive Office Building, (a) General. Wholesale corporate shock MVPE ratio to go as low as .75 Rm. 10202, Washington, DC 20530. credit unions are subject to the requirements of this part, except as set percent and restricts the absolute Executive Order 12612 decline in MVPE to 35 percent. The forth in this section. MVPE floor was lowered in the belief Executive Order 12612 requires (b) Capital. (1) A wholesale corporate that the 1 percent level could unduly NCUA to consider the effect of its credit union will maintain a minimum restrict a wholesale corporate credit actions on state interests. It states that: capital ratio of 5 percent. union and prevent it from providing ‘‘Federal action limiting the policy- (2) A wholesale corporate credit essential services to members. Since the making discretion of the states should union shall make reserve transfers at the MVPE floor serves, in part, as a cushion be taken only where constitutional lower of .10 percent of its moving daily for MVPE modeling errors, lowering the authority for the action is clear and average net assets or the amount that floor requires greater assurance that the certain, and the national activity is would be required under § 704.3(c). modeling system is reliable. necessitated by the presence of a (i) Required transfers are to be made Accordingly, proposed Section problem of national scope.’’ The risk of from earnings in either the prior 704.19(c)(2) requires a wholesale loss to federally insured credit unions calendar month or prior twelve-month corporate credit union to obtain, at its and the NCUSIF caused by actions of period. Transfers made during the prior expense, an annual third-party review of corporate credit unions are concerns of twelve-month period must be greater its asset and liability management national scope. The proposed rule than or equal to the aggregate amount of modeling system. would help assure that proper required reserve transfers for each of the In light of the forbearance provided in safeguards are in place to ensure the months in that twelve-month period. the capital and MVPE requirements, safety and soundness of corporate credit (ii) NCUA and, in the case of state- NCUA believes that a wholesale unions. chartered wholesale corporate credit corporate credit union should operate Proposed Part 704 applies to all unions, the state supervisory authority, with a lower limit on the permitted corporate credit unions that accept must be notified within 15 business decline in MVPE than provided in funds from federally insured credit days of the close of any calendar month Appendix B, Part II. The proposed limit unions. NCUA believes that the in which a wholesale corporate credit is consistent with the level of risk a protection of such credit unions, and union’s required reserve transfer wholesale corporate credit union should ultimately, the NCUSIF, warrants exceeds earnings for that month. The undertake in light of its mission to application of the proposed rule to non notice must include the dollar amounts Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38119 of the required reserve transfer and address: [email protected]. the need for country of origin marking earnings for that month and for the prior Comments must be marked Docket No. requirements for frozen imported twelve-month period. The notice must 28577. Comments may be examined in produce, and in further consideration of also provide an explanation of why the the Rules Docket in Room 915G on Customs duty to prescribe marking rules current month’s required reserve weekdays between 8:30 a.m. and 5:00 for imported merchandise when transfer exceeded earnings for that p.m., except on Federal holidays. necessary, Customs proposes to amend month. its regulations to require that the SUPPLEMENTARY INFORMATION: (c) Asset and liability management. country of origin of imported produce (1) In conducting the interest rate Background be marked on the front panel of sensitivity analysis set forth in Notice No. 96–4 was placed on packages of frozen produce in order for § 704.8(e)(1)(i), a wholesale corporate immediate display at the Federal the marking to comply with the credit union must limit its risk exposure Register on May 10, 1996, and statutory requirement that it be in a to levels that do not result, at any time, published on May 15, 1996 (61 FR ‘‘conspicuous place’’. This amendment in an MVPE ratio below .75 percent or 24582). This Notice, as published, is proposed to ensure a uniform a decline in MVPE of more than 35 provided for a 90 day comment period standard for the country of origin percent. to close on August 13, 1996. The FAA marking of frozen produce. (2) A wholesale corporate credit Rules Docket inadvertently stamped the DATES: Comments must be received on union must obtain, at its expense, an wrong date on the copy of the notice or before September 23, 1996. annual third-party review of its asset located in the docket room at FAA ADDRESSES: Written comments and liability management modeling Headquarters that comments to Notice (preferably in triplicate) may be system. No. 96–4 must be received on or before addressed to the Regulations Branch, [FR Doc. 96–18453 Filed 7–22–96; 8:45 am] August 18, 1996, which falls on a Office of Regulations and Rulings, U.S. Customs Service, Franklin Court, 1301 BILLING CODE 7535±01±P Sunday. To afford all interested persons, especially those who relied on the Constitution Ave., NW., Washington, closing date of the comment period DC 20229. Comments submitted may be inspected at the Regulations Branch, DEPARTMENT OF TRANSPORTATION provided for in the FAA Docket, the opportunity to comment on the Office of Regulations and Rulings, U.S. Federal Aviation Administration proposal, the FAA extends the comment Customs Service, Franklin Court, 1099 period, as published in the Federal 14th Street, NW., Suite 4000, 14 CFR Parts 91, 121, 127, and 135 Register, to coincide with the closing Washington, DC. date of the comment period as provided FOR FURTHER INFORMATION CONTACT: [Docket No. 28577; Notice No. 96±4] for in the FAA Docket. Therefore, David Cohen, Special Classification and RIN 2120±AG11 comments on this Notice should be Marking Branch, Office of Regulations received on or before August 19, 1996. and Rulings (202–482–6980). Special Flight Rules in the Vicinity of Extension of Comment Period SUPPLEMENTARY INFORMATION: the Rocky Mountain National Park The comment period closing date on Background AGENCY: Federal Aviation Notice No. 96–4, Special Flight Rules in Section 304 of the Tariff Act of 1930, Administration (FAA), DOT. the Vicinity of the Rocky Mountain as amended (19 U.S.C. 1304), provides ACTION: Notice of Proposed Rulemaking; National Park, is hereby extended to that, unless excepted, every article of extension of comment period. August 19, 1996. foreign origin (or its container) imported SUMMARY: This document announces an Issued in Washington, DC on July 17, 1996. into the United States shall be marked extension of the comment period on a Harold W. Becker, in a conspicuous place as legibly, Notice of Proposed Rulemaking Acting Program Director for Air Traffic, indelibly, and permanently as the (NPRM), which proposes to establish a Airspace Management. nature of the article (or its container) Special Federal Aviation Regulation to [FR Doc. 96–18552 Filed 7–22–96; 8:45 am] will permit, in such a manner as to indicate to the ultimate purchaser in the preserve the natural quiet of Rocky BILLING CODE 4910±13±M Mountain National Park from any United States the English name of the potential adverse impact from aircraft- country of origin of the article. Failure based sightseeing overflights. This DEPARTMENT OF THE TREASURY to mark an article in accordance with action is being taken to rectify the the requirements of 19 U.S.C. 1304 may discrepancy of the comment period Customs Service result in the levy of an additional duty closing date between the NPRM of ten percent ad valorem. Part 134, published in the Federal Register and 19 CFR Part 134 Customs Regulations (19 CFR Part 134), implements the country of origin the closing date of the NPRM located in RIN 1515±AB61 the FAA Rules Docket. marking requirements and exceptions of Country of Origin Marking 19 U.S.C. 1304. This document concerns DATES: Comments must be received on the correct country of origin marking for or before August 19, 1996. Requirements for Frozen Imported Produce packages of frozen imported produce ADDRESSES: Comments on this NPRM pursuant to 19 U.S.C. 1304 and 19 CFR should be mailed, in triplicate to: AGENCY: Customs Service, Treasury. part 134. Federal Aviation Administration, Office ACTION: Notice of proposed rulemaking; Customs Ruling and Court Action of the Chief Counsel, Attention: Rules solicitation of comments. Docket (AGC–200), Docket No. 28577, On May 9, 1988, Norcal/Crosetti 800 Independence Avenue SW., SUMMARY: In response to comments Foods, Incorporated, and other Washington, DC 20591. Comments may received concerning an Advance Notice California packers of domestically- also be sent electronically to the Rules of Proposed Rulemaking published by grown produce requested a ruling from Docket by using the following Internet Customs on February 2, 1995, regarding Customs concerning what constituted a 38120 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules conspicuous place for country of origin Court found that frozen vegetables were Norcal I, Customs issued Treasury marking on packages of frozen produce, commonly marketed in long, low Decision (T.D.) 91–48 (56 FR 24115, i.e., whether the marking should be freezers with open tops, or wall- May 28, 1991), which required the located on the front or some other panel mounted freezers with glass doors, and country of origin marking for frozen of the package and in what type size and that access to frozen produce is limited produce to be placed on the front panel style it should appear. The request and sometimes awkward, given that the of the package. asked Customs to determine whether produce must not defrost. The Court The government appealed the CIT’s packaged frozen imported produce was further found that packages are usually decision to the United States Court of considered marked in a conspicuous displayed so that only the front panel is Appeals for the Federal Circuit (CAFC) place if the marking did not appear on clearly visible. Further, because the on the ground that the CIT lacked the front panel of the package in packages are frozen and cold to the jurisdiction. Norcal/Crosetti Foods, Inc. prominent lettering. Sample packages touch, and because, at least in upright v. U.S., (Appeal No. 91–1295), 10 which were not marked on their front freezers, the freezer door must be held Fed.Cir. ll, 963 F.2d 356 (CAFC 1992) panels were submitted with the ruling open, the Court found that customers (Norcal II). In Norcal II, the CAFC request. On November 21, 1988, are unable to scan the labels on frozen reversed the judgment of the CIT and Customs issued Headquarters Ruling produce as easily as those on dry goods remanded the case with instructions to Letter (HRL) 731830, and stated that all or other produce that are not frozen. All dismiss the complaint for lack of of the samples that the domestic packers of these factors, according to the Court, jurisdiction; the Court held that since submitted complied with the country of prevent consumers from having the the packers had not exhausted their origin marking requirements. Customs opportunity to see the country of origin administrative remedies, their claims found that the country of origin marking marking that is secluded among the were not properly before the CIT. The on packages of frozen imported produce small print on the back of a package. CAFC indicated that a proper course was not required to appear on the front The Court found the analogy in the would have been for the packers to file panel of the package, be in lettering at ruling to the placement of nutritional a domestic interested party petition least as prominent as the product information on packages unconvincing, with Customs under section 516 of the description, and/or appear in a color or because that information was not Tariff Act of 1930, as amended (19 typestyle vividly contrasting with the required information at that time. In U.S.C. 1516). contrast, it found a more persuasive rest of the front panel to be considered The Section 516 Petition and Agency analogy in the Food and Drug conspicuous. Action (1993) The packers obtained judicial review Administration (FDA) requirement that of the Customs determination in HRL packages disclose the weight of their A Section 516 petition was initiated 731830 by the Court of International contents on the principal display panel. by letters dated January 13 and January Trade (CIT). Norcal/Crosetti Foods, Inc. Such quantity of contents disclosure 29, 1993, and filed with Customs v. U.S. Customs Service, 15 CIT 60, 758 must be a certain size and located on the pursuant to part 175, Customs F.Supp. 729 (CIT 1991) (Norcal I). In front or most prominent panel of the Regulations (19 CFR part 175). The Norcal I, the Court disagreed with the package. petitioners were Norcal/Crosetti Foods, ruling and held that frozen produce is The Court also observed that certain Incorporated and Patterson Frozen not marked in a conspicuous place packages of frozen produce listed the Foods, Incorporated, California packers unless it is marked on the front panel of name and U.S. address of the of produce grown domestically. The the package. manufacturer and failed to indicate the International Brotherhood of Teamsters, Upon examination of the sample country of origin in close proximity as on behalf of its Local 912, also packages supplied to Customs, the Court required under the Customs submitted a petition by letter dated found that the only consistency in the Regulations. Applying 19 CFR 134.46, February 24, 1993, supporting the country of origin marking of frozen the Court held that if the words ‘‘U.S.,’’ Norcal and Patterson petition imported produce was the inconsistency or ‘‘America,’’ or a United States (hereinafter, the petitions are of where manufacturers chose to place address appeared on those labels, the collectively referred to as the Norcal the marking. The Court found that most article would have to be marked to petition). The Norcal petition asked often the marking was lost among indicate the country of origin in Customs to reconsider its position in information denoted in various small lettering of at least a comparable size. HRL 731830, and to adopt the findings typefaces which appeared on the back The Court concluded by finding that, of the CIT in Norcal I. or side panels of the package. The Court although Customs had routinely The petitioners contended that frozen stated that producers were reluctant to interpreted ‘‘conspicuous’’ through 19 imported produce is not marked in conspicuously display the source of the CFR 134.41(b), Customs failed in its accordance with the requirement of 19 food, and that the result of these issuance of HRL 731830 to follow the U.S.C. 1304 that the country of origin inconsistencies was that customers clear meaning of the statute or the shall appear in a conspicuous place; could not be assured of easily finding regulation. Section 134.41(b) of the under a correct application of 19 U.S.C. the country of origin marking, even Customs Regulations provides, in part, 1304, the country of origin must appear upon reasonable inspection of the that the country of origin marking on the front panel of a package to be package. The Court stated that this was should be easily found by the ultimate considered as marked in a conspicuous a situation at cross-purposes with purchaser and read without strain. For place. These domestic producers argued Congress’ attempt to ensure that packages of imported frozen produce, further that Customs standards for the consumers know of the country of origin the Court found that the country of size and prominence of such markings of imported goods before they decide to origin marking requirements were not were not in conformity with 19 U.S.C. purchase the particular product. met by the present practice of indicating 1304. Supporting materials for the The court took judicial notice of the the country of origin marking on the petition included samples of frozen common method of displaying the back or side panels. produce packages. These samples were merchandise in shelved freezers or The Court remanded the matter to alleged to be illustrative of labels that, frozen food bins with the front panel in Customs with directions to issue a new for various reasons, were not in view and the rear panel obscured. The ruling. Pursuant to the court’s order in compliance with the marking rules: e.g., Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38121 missing markings, illegible markings, packaging as evidence of common One of the sample packages already has and markings that were not in a marking practices which were said to be been the subject of corrective action and ‘‘conspicuous place.’’ The allegations short of the statutory standards for a ruling by Customs. See, HRL 735085 closely mirrored the allegations in the permanence, legibility, and (June 4, 1993) (Mixed frozen vegetables complaint [filed] and the CIT’s findings conspicuousness. All the markings sold as ‘‘American Mixtures’’ required in Norcal I. shown on the sample packages appear to have country of origin marking on Customs published a notice in the on the back panel. One major category front of package to be considered Federal Register on September 9, 1993 of sample packages consisted of conspicuously marked; Customs (58 FR 47413), advising the public of the rectangular packages on which all the indicated at that time, however, that petitioners’ contentions and soliciting printed information, except the country marking on the back could be public comments on the issues raised in of origin marking, is pre-printed. The permissible in the absence of potentially the petition. Also in this notice, country of origin instead is evidently confusing words or marks). Customs effectively suspended the stamped after the package is filled with In T.D. 94–5 (58 FR 68743, December effective date of T.D. 91–48 by frozen produce. The quality of this 29, 1993), Customs issued a final reinstating HRL 731830. Seventy-one marking tends to be poor, and for the interpretive ruling based on the comments were submitted in response most part does not satisfy existing comments described above which were to the Norcal petition. standards for permanence and legibility. received in response to the September 9, Approximately half of the public The location is quite inconsistent 1993, Federal Register notice. T.D. 94– comments expressed support for the between various packages in the same 5 stated that back panel marking was Norcal petition to require the country of batch. Sometimes the lettering is insufficient and front panel marking of origin marking of frozen imported stamped over pre-printed information; country of origin was required in a produce to appear on the front panel of sometimes it is sideways or crooked; specified type size and style designed to the packaging. These commenters and sometimes it is smudged. These match the net weight or quantity presented data and arguments stamped-on markings are insufficient marking of the product under the Food concerning the nature of frozen produce under the current statutory criteria of 19 Labeling Regulations (21 CFR 101.105). and the manner of its storage and U.S.C. 1304, particularly as regards In T.D. 94–5, Customs modified T.D. presentation for sale, contending mainly legibility, indelibility and permanence. 91–48 by requiring that conspicuous that the inherent coldness of frozen Commenters opposed to the petition marking within the meaning of T.D. 91– produce makes the packaging more believe that these defects should be 48, shall be limited to marking which cumbersome to handle than other food remedied by enforcement under the complies with the additional products. These commenters regulations of current standards specifications for type size and style set accordingly concluded that the ultimate governing legibility, permanence, forth in T.D. 94–5. The effective date purchaser is likely to examine the indelibility and conspicuous placement, initially established for the decision in produce in haste, and is not likely to see and that there is no compelling T.D. 94–5 was May 8, 1994, in order to country of origin marking which evidence that the current regulations are allow importers time to modify their appears on the back or side panel of the inadequate. packaging. On March 29, 1994, packaging. Other sample packages submitted by however, Customs issued two Federal Some respondents also expressed the petitioners and other commenters, Register documents: One (59 FR 14458) concern that frozen produce packaging while marked permanently and legibly suspending the compliance date of May tends to accumulate frost while being under current standards (on the back 8, 1994, for parties adversely affected by stored in refrigerators, such that the panel), showed geographic markings or the country of origin marking country of origin marking often becomes names which could create confusion or requirements specified in T.D. 94–5, obscured in a way that is unique to be misleading as to the country of origin and the other (59 FR 14579) giving frozen produce. In view of these factors, of the frozen produce. Some such names notice of its intention to adopt a new it was argued, country of origin marking or markings were part of the compliance date of January 1, 1995, and which does not appear on the front of distributors’ trademarks, while others soliciting comments on both the these frozen produce packages cannot used generic names for vegetable proposed compliance date and on the be considered in a conspicuous place, products in potentially confusing ways. specifications regarding type size and and cannot meet the standard stated at The petitioners and other commenters style. 19 CFR 134.41(b) that marking must be argue that the remedy for these In response to T.D. 94–5, however, an easily found and read without strain. potentially confusing or misleading action was filed with the Court of Commenters opposed to the Norcal markings is country of origin marking International Trade on behalf of petition tended to dismiss these which appears uniformly on the front American Frozen Food Institute, contentions as unfounded. These panel of the package. They believe the Incorporated, and National Food commenters claimed that there was no ultimate purchaser is less likely to Processors Association, which reason to establish a different marking inspect frozen produce on its back panel challenged the Customs decision. In location for frozen produce packages as to ascertain its country of origin when American Frozen Food Institute, Inc.; et opposed to other imported articles. the front panel of the packaging al. v. The United States, (Slip Op. 94– They did not see the temperature of the indicates in print a reference to a locale 97), 18 CIT lll, 855 F.Supp. 388 (CIT package as a fundamental obstacle to in a country other than the country of 1994), the CIT ruled that because handling a frozen produce package and origin. Customs had chosen to promulgate front turning it over to find country of origin Commenters opposed to the petition panel marking in combination with marking. They assert that even the do not believe that ultimate purchasers other requirements needing APA information appearing on the front are deceived by such references. One (Administrative Procedure Act, 5 U.S.C. panel probably cannot be read without opponent indicated that while in some 553) rulemaking procedures, the picking up the package. cases marking on the front panel of the entirety of T.D. 94–5 could not stand. The petitioners, as well as several package may be needed, it is not The Court accepted the government’s subsequent commenters, submitted for generally necessary if the current position that to the extent the front consideration samples of frozen produce regulations were enforced in all cases. panel marking portion of T.D. 94–5 was 38122 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules separable from the other portions of the public comments received since the first than frozen produce. Further, they ruling it constituted an interpretive ruling request and the various court contend that canned produce is ruling. However, the court found that opinions. These have been considered displayed on a shelf at room the type size and style portion of the for whatever persuasive authority they temperature which makes it easy for the ruling functioned as a legislative ruling, may have regardless of whether they consumer to pick up and inspect the as Customs had selected a narrow range were submitted in response to the can. The cold conditions under which of sizes and styles from a broad ANPRM or, in the case of judicial frozen produce must be maintained in spectrum of type sizes and styles that opinions, are legally binding. the retail store make it less likely that could be considered conspicuous. consumers will examine the back or Summary of Comments Received in Accordingly, the Court found that the side panels of frozen produce packages Response to the ANPRM. selection of type size and style prior to purchase. Moreover, these requirements imposed additional A total of fifty comments were commenters submit that the consumer requirements which were not submitted in response to the February 2, has a greater motivation to examine the promulgated as a regulation in 1995, ANPRM. The commenters back label of canned vegetables than of accordance with APA rulemaking included a number of trade frozen produce. They maintain that the procedures. organizations, companies in the majority of frozen vegetables sold at The court further concluded that business of manufacturing, processing, retail are plain, blanched vegetables, because the full rulemaking process had and distributing frozen produce, a non- without additives of any kind. not been followed, it would not rule on profit organization, the Canadian These commenters further state that whether T.D. 94–5 was acceptable government, members and officials of the ingredients of frozen produce are substantively. Since the court declared the International Brotherhood of generally named and pictured on the T.D. 94–5, in its entirety, null and void, Teamsters; the California Department of front panel of each package, there is there is no decision on the 1993 Justice, and a U.S. manufacturer of almost never any added salt or sugar, petitions of the domestic interested semiconductors, personal computers, and the consumer typically knows about parties. On September 8, 1995, Customs and communications products. In the high nutritional content of received notice from Dean Foods addition to general comments, Customs vegetables and their ease of preparation. Vegetable Company (Dean Foods) that it invited specific comments regarding As a result, these commenters contend had purchased the assets of Norcal/ several issues, many of which have been that the consumer typically has no Crosetti Foods, Incorporated. Dean incorporated into this document. particular need to examine the Foods stated that, as Norcal/ Crosetti’s In response to the issues that Customs ingredients list, the nutritional content successor in interest, it no longer raised in the ANPRM as to whether or the cooking instructions as part of the supported the petition and it withdrew there are current abuses in the country process involved in making a decision the comments submitted by Norcal/ of origin marking of imported packages of whether or not to purchase the frozen Crosetti Foods in response to Customs of frozen produce, the commenters in produce item. Canned produce, they solicitation of comments. However, the favor of front panel marking claim that say, by contrast with frozen produce, petitions of Patterson Frozen Foods, many importers, processors, and usually contains ingredients beyond the Incorporated, and the International distributors of frozen produce neglect to pure agricultural product; therefore, the Brotherhood of Teamsters, on behalf of mark packages of frozen imported buyer of canned produce has more its Local 912, are still pending. produce at all. In support of this incentive to examine the contents, position, they submitted several nutritional statement and cooking Proposed Rulemaking samples of what they believe to be non- instructions than the buyer of frozen In view of the foregoing background, complying labels. Some commenters produce. Customs is exercising its authority also indicated that the marking was not Commenters opposed to the under 19 U.S.C. 1304(a)(1) to prescribe conspicuous because the marking was requirement for front panel country of by regulation reasonable methods of in an inconspicuous place, the type size origin marking submit that there is no marking and a conspicuous place on the was too small, or the ink was smeared. reason for frozen produce to be treated article (or container) where the marking Commenters opposed to a proposed any differently than any other packaged must appear on packages of frozen rulemaking contend that they are food product. They argue that Customs produce. As the foregoing history of the unaware of any abuses with respect to has never imposed a general issue illustrates, the question of marking the country of origin marking of frozen requirement that packaged goods bear of frozen imported produce has been produce and believe that there is no country of origin marking on any embroiled in eight years of procedural need to provide specific marking specific panel or in any specific type disputes and litigation. In an attempt to requirements for frozen produce. They size or type style. They submit that it disentangle the issue from this history, stated that any problems with the would be arbitrary and capricious for to provide complete regulatory due country of origin marking of frozen Customs to impose on frozen produce a process, and to facilitate a fresh produce can be addressed through a different and more burdensome labeling examination of the substantive issues case-by-case basis rather than additional requirement than that which is applied involved, Customs chose to publish an rulemaking. to all other food products and to all advance notice of proposed rulemaking On the other hand, some of the other packaged products that are subject (ANPRM). 60 FR 6464 (1995). Customs commenters believe that the way frozen to the marking requirements. published the ANPRM on February 2, produce is displayed in the supermarket These respondents dismiss the view 1995, and solicited comments with is sufficient reason to require special that packages of frozen produce should respect to the marking requirements for marking rules. The commenters in favor be the subject of special regulatory frozen imported produce. The of front panel marking believe that attention because they are displayed in comments received are summarized because of the difference between the retail freezers and are ‘‘cold to the below. way canned produce and frozen touch.’’ They maintain that there is no In addition, Customs has considered produce are displayed in the evidence to show that a frozen produce and drawn upon evidence and opinions supermarket, canned produce is easier package is so cold as to prevent the in the record of this matter, including for the consumer to pick up and inspect purchaser from removing it from the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38123 freezer display, examining it, and determined that not to proceed with a marking which is typically on the back carrying it to the check-out counter. marking proposal would leave the panel; that marking appearing on the Moreover, they state that consumers are country of origin marking situation no back panels of frozen produce packages accustomed to picking up frozen food better than it was prior to Norcal I. is not easily found and is frequently packages to read the nutritional Manufacturers of frozen produce would obscured by competing text or graphics; information contained on the rear and still be free to choose marking options and that consequently a uniform side panel of the product. They point that could make it difficult for the standard for marking should be out that in enacting its current average consumer to learn the origin of prescribed for frozen produce packages regulations, the FDA recognizes that the the produce prior to purchase, contrary in order to assure proper marking under information panel which can be located to clear Congressional intent in the law. 19 U.S.C. 1304. on the back or side panel of a package The weight of information and opinion In addition, in Customs judgment, a is a conspicuous location for ingredient submitted in response to the ANPRM front panel marking requirement and nutrition information. Thus, these did not furnish any justification for actually represents economy in commenters believe that frozen produce denial of the Section 516 petition and government regulatory activity in should not be treated any differently for termination of the rulemaking process at contrast to the available alternatives. By marking purposes than any other this stage. its very nature, the front panel is a packaged food product. In developing this proposed ‘‘conspicuous place’’. Consequently In response to the issue of whether regulation, Customs weighed a number Customs, in the proposed regulation, Customs should prescribe, by of alternatives, one of which, front panel has been able to minimize government- regulation, certain type size and style marking, was selected as the most imposed requirements and leave the specifications for the country of origin consistent with the statutory details of type size and label graphics to marking of frozen produce, commenters requirement for marking frozen produce the manufacturer while reserving the who were in favor of this proposed in a conspicuous place. Customs right to proscribe abuses. Such measure believe that the type size and believes that a front panel requirement regulatory simplicity is possible because style should vary depending upon the would prevent many of the regulatory there is little incentive or opportunity size of the package. One commenter abuses brought to the attention of for the manufacturer to clutter up the suggested that the marking should be Customs and the CIT and illustrated by front panel in a way that would obscure the same size and style as the net weight the label samples submitted to Customs. the marking and, in fact, there is a declaration. Another commenter Customs has concluded that, while it strong disincentive to do so. suggested that Customs follow the can continue on a case-by-case basis to In contrast, by its very nature, the specifications set forth in the Federal correct the types of marking problems back panel is not a ‘‘conspicuous Food Labeling Regulations (21 CFR identified in the record of this issue, place’’; it affords many opportunities to 101.1) for information appearing on the and will do so as necessary, nonetheless bury the origin marking in other principal display panel for the country a more comprehensive solution is information or graphic devices. In order of origin marking of packages of frozen needed to assure proper marking of to interpret back panel marking as produce. frozen produce for the reasons marking in a ‘‘conspicuous place’’ The commenters opposed to the discussed below. As a result, Customs is within the meaning of the statute, imposition of certain type size and style proposing a blanket requirement that Customs would have an obligation to specifications maintained that country of origin marking appear on the inject itself into the micromanagement additional regulations that would front panel of the package of frozen of label graphics in order to increase the prominence of country of imported produce. This should afford a circumscribe the current abuses. (NOTE: origin markings would impose undue definitive solution to a problem which The ‘‘back panel’’ routinely has been burdens on importers and would almost has been demonstrated to be extensive. referred to in this discussion because it certainly be inconsistent with the Much of the frozen imported produce is the location typically chosen by the government’s interest in encouraging sold in the United States is packaged manufacturer for marking under current the consumption of vegetables and after importation. As such, the marking practice. While the side panel may discouraging false health concerns. of the retail packages is not subject to contain, in some instances, less Moreover, the commenters opposed to physical supervision by Customs, but is competing information and graphics requiring certain type size and style performed under importers’ than the back panel, Customs concludes specifications for country of origin certifications for the marking of that the side panel is even less likely marking claim that there is a vast repacked articles tendered in than the back panel to receive careful difference in the amount of space that accordance with 19 CFR 134.25. The scrutiny by the consumer except after would be occupied on a package, administrative burden of enforcing the purchase when it may be necessary to depending upon whether one or ten marking of such repacked articles on a refer to it to find other information, such countries are listed. They state that the case-by-case basis is an additional as cooking time.) question posed as to whether type size reason for establishing uniform Regulating country of origin marking should vary with the size of the package specifications for the marking of frozen on the back, or information, panel thus emphasizes the impracticality of produce. Such specifications should could involve a fairly detailed set of imposing industry-wide blanket reduce ambiguity and interpretive rules on type sizes and styles, regulations. These commenters believe questions, thus facilitating broad-based background colors, margins, headers, that determinations of conspicuousness compliance by importers, packagers, etc. It could even involve a complex can and should be made on a case-by- and distributors. exercise in regulating label graphics case basis. Customs has concluded that the comparable to the ‘‘Nutrition Facts’’ box nature of frozen produce and its typical prescribed by the Food and Drug Customs Analysis of the Regulatory retail presentation makes marking on Administration. While a number of Options the back or side panel insufficient; that commenters have objected to front panel With regard to a basic issue raised in there are numerous examples of marking, we have concluded that this the ANPRM, that is, whether insufficient and potentially misleading alternative is less burdensome to rulemaking is needed, Customs marking practices based on current industry than the Government injecting 38124 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules itself into the minutiae of label graphics without qualifications or graphic is now one of the most visible things on on the back or information panel. highlighting, is not a ‘‘conspicuous any panel of a package of food. Its Absent such Government controls on place’’. In contrast, the front panel, with distinctive graphics, required by marking on the back panel, we believe its limited amount of clutter and its regulation, are as instantly recognizable that the current situation where the ready visibility, does constitute a to the American consumer today as marking tends to disappear in other text conspicuous place. The front panel thus major corporate logos and trademarks. It would not be remedied. meets the statutory test of marking in a contains its own eye-catching headline In this regard, Customs did carefully conspicuous place without elaborate ‘‘Nutrition Facts’’ and is graphically consider whether one or more conditions or regulations specifying, subdivided by three distinctive bold regulatory options that would regulate e.g., type size or other details of the lines. It must be large enough to marking of country of origin on other marking. Country of origin marking on accommodate a significant amount of than the front panel would constitute the front panel is presumptively required information. Hence, the high compliance with the statute as well as adequate so long as it is permanent, visibility or ‘‘conspicuousness’’ of the a workable alternative to front panel indelible and legible and the ultimate Nutrition Facts Box derives from its marking. In an effort to elicit purchaser can see it without strain. relative size and its unique design suggestions for such an alternative, the In the interest of an open rulemaking characteristics, not from the panel on following question was included in the process, Customs has the following which it is located. The term ANPRM: comments on a number of key issues ‘‘conspicuous’’ in the marking statute, (5) Whether a specified location on another highlighted by commenters opposed to however, refers only to the location of panel (e.g. the back panel) where the country front panel marking: the marking. In contrast to the nutritional of origin marking is demarcated by, for Importance and Prominence of Origin example, a box, a header, bold print, margins, information, under current industry Marking Relative to the Nutritional a contrasting background, or other graphic practice, the country of origin marking Information devices, would constitute a ‘‘conspicuous may consist of one or a few words such place’’ for purposes of the marking statute. Commenters opposed to a front panel as ‘‘Mexico’’ or ‘‘Product of Mexico’’ This question was intended in part to marking requirement argued that placed without any attention-getting explore the potential for a compromise country of origin information is not as graphics in a place on the back panel solution that would comply with the ‘‘important’’ as the nutrition and health where it is not particularly likely to be statute, correct existing marking information. Yet the latter, under noticed. An example is for the country problems, and be acceptable to the current government regulations, may be of origin to follow or to be merged with interested parties. Customs was relegated to the back panel. In the other geographical information, such as interested in whether, for example, a opinion of such commenters, if the back ‘‘PRODUCT FROM THE UNITED ‘‘conspicuous place’’ on the back panel panel is conspicuous enough for the STATES AND MEXICO. PACKAGED IN could be constructed by regulatory fiat concededly important nutritional THE UNITED STATES’’. Also, in the in a manner analogous to the FDA- information, it ought to be sufficiently words of one of the petitioners in the mandated ‘‘Nutrition Facts’’ box. Such a conspicuous for the origin marking. Section 516 proceeding, the origin solution might eventuate from Such a comparison, in Customs’ view, information is frequently submerged on government design, industry- contributes little to the analysis of the back panel in a ‘‘sea of cooking government agreement, or negotiated whether front panel marking of produce instructions.’’ The CIT observed in rulemaking in which Customs mediated is necessary to comply with the law and Norcal I that most often the marking is between and among interested parties. to produce the desired consumer lost among the various small typeface However, no commenter came forward recognition. A number of items on the information contained on the back or with such a solution. Also, while such label, even discretionary information side panel of the package. In sum, an alternative would be a compromise provided by the manufacturer such as Customs is not persuaded by the position, it would have the disadvantage preparation instructions and serving comparison of the relatively obscure of involving Customs in developing a suggestions, may be considered placements accorded to country of potentially elaborate set of guidelines ‘‘important’’. origin marks in current practice to the for back panel marking, suitable for However, the rationale behind the very prominent government-mandated different styles and sizes of produce different mandatory label elements such presentation of the nutritional data. packages, thus injecting the government as net weight, brand name, product more deeply into labeling decisions. identity, nutrition facts, and country of 2. The ‘‘Nutrition Facts’’ Box May Not Consideration was also given to origin are different. They do not Lead the Consumer’s Attention to the providing the manufacturer with a necessarily lend themselves to Origin Marking choice: (1) Provide a simple and legible comparative valuation as to their While the availability of nutritional marking on the front panel or (2) submit relative ‘‘importance’’ and must be data may provide a consumer with a to a more detailed set of guidelines for considered on their individual merits. reason to consult the back or marking on the back panel as in the The issue in each case is what information panel of the package, this foregoing option. While this option placement enables the particular may not draw his attention to the origin would offer the regulated industry some information to be effectively marking. As indicated above, the flexibility, it was rejected in part communicated to the consumer in a ‘‘Nutrition Facts’’ box tends to dominate because of its potential for confusing the manner that carries out the intended the panel on which it appears and the ultimate purchaser who would not have statutory or regulatory purpose. origin marking does not appear within a consistent place on the package to the box or necessarily even in proximity look for country of origin marking. 1. The ‘‘Nutrition Facts’’ Box, Without to it. Furthermore, the origin marking In sum, based on the results of the Regard to Location, Is Intrinsically More may be relegated by design to an ANPRM and other information Visible Than Current Origin Marking inconspicuous spot on the label. available, Customs concludes that the The ‘‘Nutrition Facts’’ box, mandated There also is a fundamental difference back panel (as well as the side panel), by the Food and Drug Administration between the type of information with its manifold distractions and after extensive rulemaking procedures, imparted by the ‘‘Nutrition Facts’’ box Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38125 and that imparted by the country of making a purchasing decision. All of Moreover, we believe that the origin marking. The former identifies a this information is ‘‘point of sale’’ economic motivation that lies behind number of characteristics that the information. It has little or no value the marking statute is readily apparent product possesses which, in fact, it may (except perhaps in promoting brand to the informed consumer. Major trade share generically with the same type of loyalty) once the consumer leaves the developments and bilateral trade product from another manufacturer and/ store. In contrast, nutritional disputes and sanctions have received or with a different origin. As one information has continuing educational extensive publicity in the media and in commenter suggested, consumers tend value and may be consulted by the public campaigns by trade associations, to purchase frozen vegetables as a consumer at home, particularly during labor unions and others urging ‘‘commodity’’. For common vegetables, food preparation (e.g., serving size). consumers to ‘‘Buy American’’. Thus, the nutritional value of this commodity Since country of origin marking is we see little likelihood that the is often a known quantity to the point of sale information, if the consumer will misunderstand the experienced, health-conscious consumer does not notice the significance of the country of origin consumer. Furthermore, nutritional information until he or she arrives at marking. While the consumer, once characteristics of frozen produce will home, it then is too late to assist in the informed of the country of origin, may not be likely to vary greatly from purchasing decision. The consumer choose a domestic source product over purchase to purchase, particularly if the cannot even adjust purchasing a foreign source product or vice versa, consumer chooses brands consistently. intentions based on experience for when we do not see evidence that overall This may diminish the attention paid by he or she returns to the store for the next consumption of frozen produce is likely the consumer to the nutritional purchase. By then, the facts of country to be affected by labeling rules. information once he is familiar with the of origin may have shifted again even if produce and brand. the consumer chooses the same product Impact of Front Panel Marking on Cost In this regard, it is believed that with the same brand name. and Price consumers reserve their closest scrutiny The foregoing factors, in conjunction Finally, a number of commenters of the nutritional information for with the factors cited by the CIT in argued that more detailed labeling ‘‘suspect foods’’, e.g., processed foods, Norcal I, relating to the environment in requirements would be costly to the foods known or suspected of containing the frozen food aisle, may cause the manufacturers and that these costs high levels of fat, sodium, sugar, or country of origin marking of frozen would be passed on to the consumer. additives. In contrast, frozen fruits and imported produce not to be noticed This would particularly be true, they vegetables tend to be the ‘‘good guys’’ of prior to purchase. This is precisely the state, if the product were sourced from the supermarket which require little type of outcome that the section 1304 many countries and if the sources were scrutiny. In fact, in response to a requirement that the marking be in a constantly shifting. Some of these ‘‘conspicuous place’’ is designed to petition filed by the American Frozen broadly stated arguments seem aimed at prevent. Food Institute, the Food and Drug the marking requirement itself, a Administration recently has published a Health and Safety Implications of Front statutory mandate that Customs has no notice of proposed rulemaking that Panel Marking choice but to enforce. Implicit in the would permit the use of the term marking statute is the effort and expense ‘‘healthy’’ to describe frozen vegetables A number of the commenters who opposed further rulemaking expressed of adding information to a label that based on arguments submitted by the might not otherwise be incurred. There industry that the nutrient profile for concerns that requiring more is no exemption in the statute, or in the frozen vegetables is essentially the same conspicuous labeling of produce would Customs Regulations, for products as that for fresh vegetables. 61 FR 534 arouse false concerns about health and sourced in a number of countries. (February 12, 1996). The foregoing safety on the part of consumers. In their considerations may result in the fine view, this could lead to decreased On the other hand, it may be noted print on the information panel of frozen purchases and consumption of frozen that frozen produce labels already produce packages, including both produce with resulting negative impacts frequently are characterized by colorful, nutritional information and origin on the U.S. economy and even on the sophisticated, and detailed graphics. marking, receiving less attention while health of consumers. These labels may include an array of the consumer is in the store than in the No information has been submitted to totally discretionary and promotional case of other products, including us and none suggests itself to us that information offered by the manufacturer canned produce. would validate this concern. Customs such as recipes and advertisements for believes that it is unlikely that a other products. Realistically evaluating 3. Origin Marking Relates to the Identity consumer will perceive an implied the proposed rule in this context, we of the Product and Is Exclusively ‘‘Point health warning in label information that have not received convincing evidence of Sale’’ Information is in no way identified as a warning. that placing simple country of origin Country of origin marking, in contrast Consumers are presumably familiar information in a different or additional to nutritional information, furnishes with the health warning labels on place on the label, if required after a information that is specific to the tobacco products and alcoholic reasonable period of time for industry to product in the individual package that beverages, which are clearly stated as adjust, will adversely impact profit the consumer is examining. In fact, the such, as well as poison warnings. margins, be economically injurious to origin information can be considered Further, it is unlikely that the consumer the consumer, or have an inflationary part of the ‘‘identity’’ of the product. will conclude that information such as impact. Other information that describes, country of origin that does not appear in Further, as a practical matter, we have defines, or illustrates the identity of the the ‘‘Nutrition Facts’’ box is intended to not received to date empirical evidence product, such as the brand name or the convey a health and safety advisory. We that sourcing from more than two or vignette; the product name, e.g., believe it would take a highly explicit three countries is widespread as an cauliflower; and the net weight are on warning to overcome the consumer’s industry practice. In fact, we are not the front panel where they can be belief in the presumptive healthfulness aware that it is likely that more than a instantly grasped by the consumer in of frozen vegetables and fruits. single source is typically involved in the 38126 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules case of a package containing a single 3. Implementation Period ANPRM on the length of the comment product (e.g., broccoli or cauliflower). Suggestions received in response to period for an NPRM ranged from 60 days to 120 days. Customs is herein Other Issues the ANPRM regarding the length of the period from the publication date of a providing its customary 60-day period. 1. Type Size and Style Requirements final rule to the required Since no commenter requested time in which to conduct a consumer survey, implementation date ranged from 6 to T.D. 94–5 contained fairly detailed Customs believes the 60-day period is 12 months from commenters favoring type size requirements applicable to its adequate, particularly in view of the tightened marking rules to 17 months or front panel marking requirement. Three extensive opportunity to comment more from commenters opposed to a different type sizes were specified for already afforded, and it is not expected new rulemaking on marking of country different size packages of produce. that this period will be extended. In of origin. Common sense as well as However, this proposed rule does not addition to comments received on this evidence in the record of this matter specify type sizes and styles, proposal, all relevant material indicates to Customs that the background colors or other graphic previously submitted will be taken into incremental cost of relabeling to comply stipulations applicable to front panel account in deciding on a final rule. marking. Customs believes that this is with new marking rules tends to have Pending a decision on whether a final consistent with regulatory economy and dropped dramatically by 18 months rule will be promulgated, Customs minimum regulatory burden to the after the promulgation of new rules. continues to deliberate on what industry. Moreover, Customs has Thus, Customs is proposing an 18- requirements are proper in the case of concluded that the front panel marking month implementation period to allow multiple source countries and whether requirement, subject to the other for current stock of labels to be depleted Customs should set forth a de minimis statutory criteria of legibility, prior to the effective date of any final level of foreign content that would indelibility, and permanence is rule. trigger the country of origin marking sufficient to provide an adequate 4. Consumer Surveys requirements. These issues are not opportunity for the reasonably attentive within the scope of this proposed consumer to notice the country of origin Information submitted by commenters rulemaking. Customs will consider the information at point of sale. Customs in response to the question in the possible need for rulemaking on these reserves its right to take enforcement ANPRM regarding determination of issues in the future. action in the event that label graphics consumer behavior through surveys was Since this administrative rulemaking on a package obscure or destroy the divided and not conclusive. In general, process affects the decision to be made requisite legibility of the marking. there was opposition, particularly by on the pending section 516 petition, the commenters opposed to rulemaking, to Customs Service has decided to delay 2. Overstamped Markings and Other the government conducting surveys at issuance of a final decision on the Illegible Markings taxpayers’ expense. In fact, Customs has section 516 petition until a final conducted no survey and does not determination regarding the proposed The plaintiffs in Norcal I and various contemplate conducting a survey. commenters have alleged that packages regulations concerning the country of Commenters basing opinions on origin marking of packages of frozen of frozen produce contained stamped existing surveys reached different markings that are smeared or otherwise produce contained in this document is conclusions. Those favoring rulemaking made. illegible. In a number of cases, packages argued that consumers were interested are apparently ink stamped with the in country of origin information and Discussion of Proposed Amendment name of the country of origin after the tended to modify their behavior if such Customs proposes to amend part 134 packages have been filled with product. information were available. Some of the of the Customs Regulations (19 CFR part Frequently the result is a stamp that is data relied on by these commenters 134) by adding a new paragraph (f) to smeared or all but wiped off due to concerned products other than produce, § 134.43 to implement the country of condensation on the package. In other e.g., apparel. Opponents of rulemaking origin marking requirements for cases, the stamping is upside down vis- argued, among other things, that packages of frozen imported produce. a-vis the print on the panel where the consumers had little interest in country Section 134.43 sets forth the methods of stamp appears, is turned sideways, or is of origin information. While some marking for specific articles, such as placed over other text or graphics. All consumers may value country of origin watches, clocks, timing apparatus, of these practices violate statutory information as enabling them to act on Native-American-style jewelry, and standards. preferences they may have regarding Native American-style arts and crafts. No change in the marking imported versus domestic-source Proposed paragraph (f) will contain two requirements is proposed to address products, other consumers may be subparagraphs: Paragraph (1) will define these problems. Customs believes that relatively indifferent to the information. frozen produce which is subject to the current regulations and enforcement In either event, the marking statute is marking requirement, and paragraph (2) powers are adequate. The importer is not designed solely for the individual will denote the method of marking that responsible for compliance with the benefit of the consumer, but serves a is deemed acceptable. marking statute. If ink markings, stick- broader purpose. on labels and other practices that Proposed Effective Date importers use to avoid the cost or Opportunity for Public Comment Customs recognizes that rigidity of preprinted labels do not hold As the foregoing illustrates, several manufacturers, distributors, and packers up until the product reaches the issues with respect to the rulemaking of frozen imported produce will need to ultimate consumer at the point of sale, procedure to promulgate country of consider revisions in their current then Customs reserves the right to take origin marking regulations for frozen packaging which may be needed to appropriate action, as prescribed by imported produce remain and public comply with these proposed statute and regulations, including comments are once again being solicited regulations. Thus, in order to minimize detention of the merchandise and prior to the issuance of a final rule. the impact of these new requirements, it imposition of marking duties. Suggestions received in response to the is also proposed that the regulations, if Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38127 adopted, not be effective until eighteen Proposed Amendments Office of the Assistant Secretary for months from the date of the Federal Financial Markets Register Notice of Final Rulemaking. It is proposed to amend part 134, Customs Regulations (19 CFR part 134), Fiscal Service Comments as set forth below: 31 CFR Part 356 While Customs received a request for PART 134ÐCOUNTRY OF ORIGIN a public hearing on the issues involved MARKING Amendments to the Uniform Offering in this rulemaking from one commenter, Circular for the Sale and Issue of the great majority of the commenters did 1. The authority citation for part 134 Marketable Book-Entry Treasury Bills, not favor a hearing. Under these continues to read as follows: Notes and Bonds; Notice of Meeting circumstances, Customs does not Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 AGENCY: Office of the Assistant believe that a hearing would Secretary for Financial Markets, significantly enhance the process of (General Note 20, Harmonized Tariff Schedule of the United States), 1304, 1624. Treasury. public participation in the rulemaking ACTION: Advance Notice of Proposed and does not plan to hold a hearing. 2. In § 134.43, it is proposed to add a Rulemaking; Meeting. However, before adopting this proposed new paragraph (f) to read as follows: regulation as a final rule, consideration SUMMARY: On May 20, 1996, the will be given to any written comments § 134.43 Methods of marking specific Department of the Treasury published that are timely submitted in connection articles. an Advance Notice of Proposed with this notice. Comments are * * * * * Rulemaking soliciting comments on requested on both the substance of these (f) Frozen Produce—(1) Definition. certain aspects of a new inflation- proposals and the proposed effective Frozen produce means frozen vegetables protection security. The Treasury is date, if the proposals are adopted. or mixtures of frozen vegetables hosting a symposium to discuss the Members of the public submitting provided for in Chapter 7, Harmonized advantages and disadvantages of certain structures under consideration for the comments based on current labeling Tariff Schedule of the United States practices are requested, where possible, inflation-protection security Treasury (HTSUS), or frozen fruits or mixtures of to submit sample labels illustrating the intends to issue. The meeting will be frozen fruits provided for in Chapter 8, alleged practices. The submission of open to the public. HTSUS. duplicate sets of labels will expedite DATES: 3:00 p.m., July 24, 1996. evaluation of the comments and will be (2) Method of Marking. (i) Unless ADDRESSES: Main Treasury Building, appreciated by the Customs Service. otherwise excepted pursuant to 19 1500 Pennsylvania Avenue, N.W., U.S.C. 1304(a)(3) and subpart D of this Comments submitted will be available Washington, D.C. 20220; Meeting Room part, frozen produce must be marked for public inspection in accordance with To Be Announced. For security reasons, the Freedom of Information Act (5 with the country of origin of the in order to be admitted to the Treasury U.S.C. 552), § 1.4, Treasury Regulations produce on the front panel of its Building, you must call the contact (31 CFR 1.4), and § 103.11(b), Customs package for retail sale. The front panel person below. Regulations (19 CFR 103.11(b)), on is the part of a package that is most FOR FURTHER INFORMATION CONTACT: regular business days between the hours likely to be displayed, presented, Questions about this notice should be of 9 a.m. and 4:30 p.m. at the shown, or examined by the ultimate addressed to Alison Shelton, Financial Regulations Branch, Office of purchaser under customary conditions Economist, Office of Federal Finance Regulations and Rulings, U.S. Customs of display for retail sale. Policy Analysis, Office of the Assistant Service, 1099 14th Street, NW., Suite (ii) The country of origin marking on Secretary for Financial Markets, at 202– 4000, Washington, DC. the frozen produce required by 622–2680. Persons wishing to attend the paragraph (f)(2)(i) of this section must meeting are requested to contact Tinese Inapplicability of the Regulatory appear in permanent, indelible and Hamilton at 202–622–2624, prior to Flexibility Act, and Executive Order legible print or type so that the 12:00 noon Eastern time on July 24, 12866 1996, to make arrangements for consumer can easily read it without attendance. For the reasons set forth in the strain. Condensed or compressed SUPPLEMENTARY INFORMATION: On May preamble, pursuant to the provisions of typefaces or arrangements shall not be 16, 1996, the Department of the the Regulatory Flexibility Act (5 U.S.C. used. Treasury (Department or Treasury) 601, et seq.), it is certified that the Approved: July 9, 1996. announced its intention to issue a new amendment, if adopted, will not have a Michael H. Lane, type of marketable book-entry security significant economic impact on a with a nominal return linked to the substantial number of small entities. Acting Commissioner of Customs. James E. Johnson, inflation rate in prices or wages, as Accordingly, it is not subject to the officially published by the United States regulatory analysis or other Assistant Secretary of the Treasury (enforcement). Government. An Advance Notice of requirements of 5 U.S.C. 603 and 604. Proposed Rulemaking (ANPR) seeking [FR Doc. 96–18544 Filed 7–22–96; 8:45 am] Further, this proposed amendment does comments on various structures was not meet the criteria for a ‘‘significant BILLING CODE 4820±02±P published on May 20, 1996 (61 FR regulatory action’’ as specified in E.O. 25164) and a series of meetings was 12866. subsequently held by the Treasury to List of Subjects in 19 CFR Part 134 obtain public input on the new inflation-protection security. Country of origin, Customs duties and As a result of the comments received inspection, Imports, Labeling, Marking, in response to the ANPR and at the Packaging and containers. public meetings, the Department is 38128 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules holding a symposium to discuss and all the inflation compensation and real different from those for the Canadian- obtain comments and information on interest is paid out semiannually. The style structure? the comparison between two different formula for the semiannual coupon on (6) What would be the best way to structures for an inflation-protection the current pay security is the sum of auction current pay securities? For security—a Canadian-style and a current the semiannual coupon and the example, should the Treasury use a pay structure. principal appreciation (depreciation) of single-price auction and set the coupon The Treasury has invited certain the Canadian-style security. Looking at rate at the highest accepted yield? commenters to take part in the this another way, the current pay Should reopening auctions be based on symposium. These participants will semiannual coupon rate is the sum of price rather than yield? comment on certain questions posed by the real semiannual rate, the six-month the Treasury and take part in a percentage change in the price or wage (7) Which structure would provide discussion. Members of the public are index, and the product of these two the Treasury with the largest savings in invited to observe. Written comments rates. The principal of the current pay financing costs? from the public are also welcome (see security would not be indexed. In order Written Comments below). The Treasury intends to seek to simplify the security, it is assumed further comment on the structure for here that the rate will not be less than The Treasury also welcomes written Treasury inflation-protection securities zero. Possible formulas for the current comments on these questions. Written and other issues prior to issuing final pay structure are provided in the comments should be sent to: The rules. Appendix at the end of this notice. Government Securities Regulations Staff, Bureau of the Public Debt, 999 E Possible Structures Questions Street N.W., Room 515, Washington, The Canadian-style structure was The Treasury Department is interested D.C. 20239. Comments received, described in the ANPR. Briefly, the in response to the following questions: together with any written materials principal of a Canadian-style inflation- (1) Which structure, Canadian or presented at the symposium, will be protection security is adjusted for current pay, is likely to have the largest available for public inspection and inflation (with a lag) such that its real potential market? copying at the Internal Revenue Service, value remains constant. The semiannual (2) Which investor groups would find FOIA Reading Room, located at the coupon payments are a fixed percentage investments in the different structures Internal Revenue Service building at of the current, inflation-adjusted value appealing? Pennsylvania Avenue and 11th Streets, of the principal on the interest payment (3) How would the yield on the N.W., Room 1621, until the Treasury date. At maturity, the inflation-adjusted current pay structure compare with the Department Library reopens. principal is paid, along with the last yields on other Treasury securities Dated: July 18, 1996. interest payment. (Please refer to the (bills, notes, or bonds)? ANPR for the formulas for the Canadian- (4) If the current pay structure were Darcy Bradbury, style structure.) strippable, would there be substantial Assistant Secretary, Financial Markets. Some commenters have suggested that market interest in the stripped Appendix—Formulas for Current Pay the Treasury consider an alternative components? Structure structure that was not described in the (5) Would the preferred maturity ANPR. Under this current pay structure, sectors for the current pay structure be I. Reference INUM:

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II. Index Ratio:

Ref INUMDate Index RatioDate = Ref INUMLastSA

III. Semiannual Interest: Ref INUMLastSA=reference INUM for the Infl. Rate=Index RatioDate¥1 original issue date or last A. Coupon = (I/2) × Index RatioDate × [FR Doc. 96–18802 Filed 7–19–96; 2:31 pm] semiannual interest payment date P + (Index RatioDate ¥ 1) X P BILLING CODE 4810±39±M though not less than zero. Ref INUMM=reference INUM for the first day of the calendar month in which B. Coupon Rate = (I/2) + Infl. Rate + ((I/ Date falls 2) × Infl. Rate) though not less than zero. Ref INUMM∂1=reference INUM for the first day of the calendar month Definitions: immediately following Date Date=valuation date I=real interest rate (set at initial auction) D=the number of days in the month in which Date falls P=principal amount t=the calendar day corresponding to Coupon=semiannual interest payment Date amount INUM=index number Coupon Rate=semiannual coupon rate Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38129

ENVIRONMENTAL PROTECTION inspection during normal business Identification Branch, Mitigation AGENCY hours at the following locations. The Directorate, 500 C Street SW., interested persons wanting to examine Washington, DC 20472, (202) 646–2756. 40 CFR Part 52 these documents should make an SUPPLEMENTARY INFORMATION: The appointment with the appropriate office [WA43±7116b; FRL±5514±5] Federal Emergency Management Agency at least 24 hours before the visiting day. (FEMA or Agency) proposes to make Approval and Promulgation of Air Environmental Protection Agency, determinations of base flood elevations Quality Implementation Plans; Region 10, Office of Air Quality, 1200 and modified base flood elevations for Washington; Revision to the State 6th Avenue, Seattle, WA 98101. each community listed below, in Implementation Plan Vehicle The Washington State Department of accordance with section 110 of the Inspection and Maintenance Programs Ecology, P.O. Box 47600, Olympia, Flood Disaster Protection Act of 1973, WA 98504–7600. 42 U.S.C. 4104, and 44 CFR 67.4(a). AGENCY: Environmental Protection FOR FURTHER INFORMATION CONTACT: These proposed base flood and Agency (EPA). Stephanie Cooper, EPA, 1200 6th modified base flood elevations, together ACTION: Proposed rule. Avenue, Seattle, WA 98101, (206) 553– with the floodplain management criteria 6917. required by 44 CFR 60.3, are the SUMMARY: The EPA proposes to approve minimum that are required. They SUPPLEMENTARY INFORMATION: the State Implementation Plan (SIP) See the should not be construed to mean that revision submitted by the State of information provided in the Direct Final the community must change any Washington for the purpose of action which is located in the Rules existing ordinances that are more approving the Inspection and Section of this Federal Register. stringent in their floodplain Maintenance (I/M) State Dated: May 24, 1996. management requirements. The Implementation Plan (SIP), for Jane S. Moore, community may at any time enact Washington State. On August 21, 1995, Acting Regional Administrator. stricter requirements of its own, or Washington submitted SIP revision [FR Doc. 96–18200 Filed 7–22–96; 8:45 am] pursuant to policies established by other requests to the EPA to satisfy the BILLING CODE 6560±50±P Federal, state or regional entities. These requirements of sections 182(b)(4) and proposed elevations are used to meet 182(c)(3) of the Clean Air Act, as the floodplain management amended, and Federal I/M rule 40 CFR FEDERAL EMERGENCY requirements of the NFIP and are also part 51, subpart S. These SIP revisions MANAGEMENT AGENCY used to calculate the appropriate flood will require vehicle owners to comply insurance premium rates for new with the Washington I/M program in the 44 CFR Part 67 buildings built after these elevations are two Washington ozone nonattainment made final, and for the contents in these areas classified as ‘‘marginal’’ and in the [Docket No. FEMA±7187] buildings. three carbon monoxide nonattainment National Environmental Policy Act. Proposed Flood Elevation This proposed rule is categorically areas classified as ‘‘moderate’’. This Determinations; Illinois et al. revision applies to the Washington excluded from the requirements of 44 counties of Clark, King, Pierce, AGENCY: Federal Emergency CFR Part 10, Environmental Snohomish, and Spokane. In the Final Management Agency, FEMA. Consideration. No environmental Rules Section of this Federal Register, ACTION: Proposed rule. impact assessment has been prepared. the EPA is approving the State’s SIP Regulatory Flexibility Act. The Acting revision as a direct final rule without SUMMARY: Technical information or Associate Director, Mitigation prior proposal because the Agency comments are requested on the Directorate, certifies that this proposed views this as a noncontroversial proposed base (1% annual chance) flood rule is exempt from the requirements of revision and anticipates no adverse elevations and proposed base flood the Regulatory Flexibility Act because comments. A detailed rationale for the elevation modifications for the proposed or modified base flood approval is set forth in the direct final communities listed below. The base elevations are required by the Flood rule. If no adverse comments are flood elevations are the basis for the Disaster Protection Act of 1973, 42 received in response to this proposed floodplain management measures that U.S.C. 4104, and are required to rule, no further activity is contemplated the community is required either to establish and maintain community in relation to this rule. If the EPA adopt or to show evidence of being eligibility in the National Flood receives adverse comments, the direct already in effect in order to qualify or Insurance Program. As a result, a final rule will be withdrawn and all remain qualified for participation in the regulatory flexibility analysis has not public comments received will be National Flood Insurance Program been prepared. addressed in a subsequent final rule (NFIP). Regulatory Classification. This proposed rule is not a significant based on this proposed rule. The EPA DATES: The comment period is ninety regulatory action under the criteria of will not institute a second comment (90) days following the second section 3(f) of Executive Order 12866 of period on this action. publication of this proposed rule in a September 30, 1993, Regulatory newspaper of local circulation in each DATES: Comments on this proposed rule Planning and Review, 58 FR 51735. must be received in writing by August community. Executive Order 12612, Federalism. 22, 1996. ADDRESSES: The proposed base flood This proposed rule involves no policies ADDRESSES: Written comments should elevations for each community are that have federalism implications under be addressed to Montel Livingston, available for inspection at the office of Executive Order 12612, Federalism, Environmental Protection Specialist the Chief Executive Officer of each dated October 26, 1987. (OAQ–107), Office of Air Quality, at the community. The respective addresses Executive Order 12778, Civil Justice EPA Regional Office listed below. are listed in the following table. Reform. This proposed rule meets the Copies of the documents relevant to this FOR FURTHER INFORMATION CONTACT: applicable standards of section 2(b)(2) of proposed rule are available for public Michael K. Buckley, P.E., Chief, Hazard Executive Order 12778. 38130 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

List of Subjects in 44 CFR Part 67 PART 67Ð[AMENDED] 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 Comp., p. 376. Administrative practice and procedure, Flood insurance, Reporting 1. The authority citation for part 67 § 67.4 [Amended] continues to read as follows: and recordkeeping requirements. 2. The tables published under the Accordingly, 44 CFR part 67 is Authority: 42 U.S.C. 4001 et seq.; authority of § 67.4 are proposed to be proposed to be amended as follows: Reorganization Plan No. 3 of 1978, 3 CFR, amended as follows:

#Depth in feet above ground. *Elevation in feet State City/town/county Source of flooding Location (NGVD) Existing Modified

Illinois ...... Kankakee County Kankakee River ...... Approximately 0.5 mile upstream of con- *613 *608 (Unincorporated fluence of Iroquois River. Areas). Approximately 0.4 mile upstream of con- *613 *608 fluence with Kankakee River along Spring Creek. Maps available for inspection at the Kankakee County Administration Building, 189 East Court Street, Kankakee, Illinois. Send comments to Mr. Russell Thompson, Chairman of the Kankakee County Board, Kankakee County Administration Building, 189 East Court Street, Kankakee, Illinois 60901.

Illinois ...... Sun River Terrace Kankakee River ...... At downstream corporate limits ...... *617 *611 (Village) Kan- kakee County. At upstream corporate limits ...... *617 *611 Maps available for inspection at the Sun River Terrace Village Hall, 7267 East Chicago Street, St. Anne, Illinois. Send comments to The Honorable Casey Wade, Jr., Mayor of the Village of Sun River Terrace, 7267 East Chicago Street, St. Anne, Illinois 60964.

Illinois ...... Wood Dale (City) Salt Creek ...... Just upstream of Thorndale Avenue ...... None *281 DuPage County. Approximately 0.8 mile upstream of None *283 Thorndale Avenue. Maps available for inspection at the Building Department, Wood Dale City Hall, 404 North Wood Dale Road, Wood Dale, Illinois. Send comments to The Honorable David L. VanGeest, Mayor of the City of Wood Dale, 404 North Wood Dale Road, Wood Dale, Illinois 60191.

Michigan ...... Buena Vista (Town- Saginaw River Flood Stor- Area east of Interstate 75 and north of *586 *587 ship) Saginaw age Area. East Washington Road. County. Saginaw River ...... At downstream corporate limits ...... *588 *589 Approximately 0.75 mile downstream of *588 *589 upstream corporate limits. Maps available for inspection at the Township Clerk's Office, 1160 South Outer Drive, Saginaw, Michigan.

Send comments to Ms. Frances Hayes, Supervisor of the Charter Township of Buena Vista, 1160 South Outer Drive, Saginaw, Michigan 48601.

Michigan ...... Carrollton (Town- Saginaw River ...... Immediate area south of Tittabawassee *587 *589 ship) Saginaw Street and west of Venoy Road. County. Area west of CONRAIL and south of *588 *589 Schust Road. Maps available for inspection at the Carrollton Township Building, 1645 Mapleridge, Saginaw, Michigan. Send comments to Mr. Christopher Picard, Carrollton Township Supervisor, 1645 Mapleridge, Saginaw, Michigan 48604.

Michigan ...... Frankenmuth Cass River ...... Approximately 0.6 mile downstream of None *612 (Township) Sagi- South Main Street. naw County. Approximately 0.5 mile downstream of None *612 South Main Street. Maps available for inspection at the Frankenmuth Township Building, 218 West Gennessee Street, Frankenmuth, Michigan. Send comments to Mr. Martin Warnick, Supervisor of Frankenmuth Township, 218 West Gennessee Street, Frankenmuth, Michigan 48734.

Michigan ...... James (Township) Tittabawassee River ...... Area north of CONRAIL and east of Van *596 *594 Saginaw County. Wormer Road. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38131

#Depth in feet above ground. *Elevation in feet State City/town/county Source of flooding Location (NGVD) Existing Modified

Maps available for inspection at the James Township Hall, 2590 Sierra Drive, Saginaw, Michigan. Send comments to Mr. Gerald M. Wieneke, Supervisor of James Township, 2255 Wiegl Road, Saginaw, Michigan 48603.

Michigan ...... Kochville (Town- Kochville Drain ...... Approximately 0.75 mile downstream of *585 *586 ship) Saginaw CONRAIL. County. Approximately 400 feet upstream of *585 *586 Kochville Road. Saginaw River ...... (Area within the township) west of Venoy *585 *586 Road and north of Tittabawassee Street. Saginaw Bay ...... Saginaw River west of Venoy Road and *585 *586 north of Tittabawassee Street. Maps available for inspection at the Kochville Township Hall, 5851 Mackinaw Road, Saginaw, Michigan. Send comments to Mr. Edward Allington, Kochville Township Supervisor, 5851 Mackinaw Road, Saginaw, Michigan 48604.

Michigan ...... Swan Creek (Town- Shiawasee Flats ...... Barer and Benkert Roads intersection ..... None *594 ship) Saginaw County. Maps available for inspection at the Swan Creek Township Offices, 11415 Lakefield Road, St. Charles, Michigan. Send comments to Mr. Don Rappley, Swan Creek Township Supervisor, 11415 Lakefield Road, St. Charles, Michigan 48655.

Michigan ...... Thomas (Township) Shiawassee Flats At Ederer Road and North River Road *597 *596 Saginaw County. (Tittabawassee River). intersection. Swan Creek ...... At Ederer Road ...... None *594 At Geddes Road ...... *593 *594 Maps available for inspection at the Thomas Township Offices, 249 North Miller Road, Saginaw, Michigan. Send comments to Mr. Morrison Stevens, Thomas Township Supervisor, 249 North Miller Road, Saginaw, Michigan 48609.

Michigan ...... Zilwaukee (City) Saginaw Bay ...... Area west of Grand Trunk Western Rail- *585 *586 Saginaw County. road and north of Tittabawassee Street. Saginaw River ...... Area west of CONRAIL and south of *588 *589 Tittabawassee Street. At downstream and upstream sides of *588 *589 Interstate Route 75. Maps available for inspection at the Zilwaukee City Hall, 319 Tittabawassee Road, Saginaw, Michigan. Send comments to The Honorable Richard DeLong, Mayor of the City of Zilwaukee, 319 Tittabawassee Road, Saginaw, Michigan 48604.

Michigan ...... Zilwaukee (Town- Kochville Drain ...... Approximately 0.4 mile upstream of Inter- *585 *586 ship) Saginaw state Route 75. County. Approximately 400 feet downstream of *585 *586 Kochville Road. Saginaw River Flood Stor- Area east of State Route 13 (Veterans *586 *587 age Area. Memorial Parkway). Saginaw River ...... Approximately 3.3 miles downstream of *586 *587 Interstate Route 75. Approximately 1,000 feet upstream of *588 *589 Interstate Route 75. Saginaw Bay ...... Areas west of Grand Trunk Western and *585 *586 north of Kochville Road. Maps available for inspection at the Township Supervisor's Home Office, 7600 Melbourne Road, Saginaw, Michigan. Send comments to Mr. David F. Bradt, Zilwaukee Township Supervisor, 7600 Melbourne Road, Saginaw, Michigan 48604.

Mississippi ...... Pearl (City) Rankin Conway Slough Tributary Approximately 0.1 mile upstream of Pear- None *271 County. 2. son Road culvert. 38132 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

#Depth in feet above ground. *Elevation in feet State City/town/county Source of flooding Location (NGVD) Existing Modified

Approximatley 0.1 mile upstream of Lio- None *284 nel Road. Neely Creek (Left Chan- Approximately 30 feet downstream of *272 *271 nel). North Biederman Road. At downstream side of Old Brandon *281 *282 Road. Neely Creek Tributary 2 ... At downstream side of North Biederman *272 *271 Road. Approximately 1.2 miles upstream of Illi- None *280 nois Central Gulf Railroad. Richland Creek ...... Approximately 1,050 feet upstream of Old *283 *284 Pearson Road. Approximately 1.3 miles upstream of con- *289 *288 fluence of Richland Creek Tributary 1. Richland Creek Tributary At confluence with Richland Creek ...... *286 *285 1. Approximately 400 feet downstream of Il- *288 *287 linois Central Gulf Railroad. Maps available for inspection at the Pearl City Hall, Department of Community Development, 2420 Old Brandon Road, Pearl, Mississippi. Send comments to The Honorable Mitch Childre, Mayor of the City of Pearl, P.O. Box 5948, Pearl, Mississippi 39288±5948.

New York ...... Canandaigua Lake Canandaigua ...... Approximately 200 feet east of intersec- *693 *692 (Town) Ontario tion of Cribb and West Lake Roads. County. Approximately 1,800 feet east of the *695 *692 intersection of Coy and West Lake Roads. Mud Creek ...... Approximately 2,000 feet downstream of None *683 downstream corporate limits. Approximately 200 feet upstream of up- None *706 stream corporate limits. Maps available for inspection at the Town of Canandaigua Planning Department, 5440 Route 5 and 20 West, Canandaigua, New York. Send comments to Mr. Robert F. Simpson, Sr., Supervisor of the Town of Canandaigua, 5440 Route 5 and 20 West, Canandaigua, New York 14424.

New York ...... Gouverneur (Vil- Oswegatchie River ...... At corporate limits ...... None *395 lage) St. Law- rence County. Approximately 0.74 mile upstream of None *411 State Route 58. Maps available for inspection at the Village Clerk's Office, Gouverneur Municipal Building, 33 Clinton Street, Gouverneur, New York. Send comments to The Honorable Dierdre Scozzafasa, Mayor of the Village of Gouverneur, 33 Clinton Street, Gouverneur, New York 13642.

New York ...... Windham (Town) Batavia Kill ...... At downstream corporate limits ...... None *1466 Greene County. At confluence of Mitchell Hallow Tributary None *1517 Maps available for inspection at the Windham Town Hall, Route 296, Hensonville, New York. Send comments to Mr. Patrick Meehan, Windham Town Supervisor, P.O. Box 96, Hensonville, New York 12439.

Pennsylvania ...... London Grove East Branch White Clay Approximately 1,000 feet downstream of None *259 (Township) Ches- Creek. Newgarden Station Road. ter County. Approximately 700 feet downstream of None *270 confluence of Chatham Run. Chatham Run ...... Approximately 350 feet downstream of None *283 Pomeroy Street. At State Road 926 ...... None *504 Maps available for inspection at the at the London Grove Township Building, 550 East Baltimore Pike, Suite 200, West Grove, Pennsylvania. Send comments to Mr. Lewis C. Ross, Chairman of the Township of London Grove Board of Supervisors, 550 East Baltimore Pike, Suite 200, West Grove, Pennsylvania 19390.

Pennsylvania ...... Westtown (Town- West Fork of East Branch At upstream side of Street Road ...... *263 *258 ship) Chester Chester Creek. County. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38133

#Depth in feet above ground. *Elevation in feet State City/town/county Source of flooding Location (NGVD) Existing Modified

Approximately 150 feet downstream of *263 *262 Westbourne Road. Maps available for inspection at the Westtown Township Office, 1081 Wilmington Pike, West Chester, Pennsylvania. Send comments to Mr. Kenton S. Stokes, Chairman of the Westtown Township Board of Supervisors, P.O. Box 79, Westtown, Pennsylvania 19395.

(Catalog of Federal Domestic Assistance No. FOR FURTHER INFORMATION CONTACT: Ms. Negotiated Rulemaking Process 83.100, ‘‘Flood Insurance’’) Teresa Doggett, Office of Motor Carrier Mediator/Facilitator Dated: July 10, 1996. Research and Standards, (202) 366– Richard W. Krimm, 4001, or Ms. Grace Reidy, Office of In the notice of intent, the FHWA Acting Associate Director for Mitigation. Chief Counsel, (202) 366–0834, Federal stated that it retained the services of a [FR Doc. 96–18663 Filed 7–22–96; 8:45 am] Highway Administration, 400 Seventh contractor, Mr. Philip J. Harter, to act as a convener and provide advice on the BILLING CODE 6718±04±P Street, SW., Washington, D.C. 20590. Office hours are from 7:45 a.m. to 4:15 feasibility of using negotiated p.m. e.t., Monday through Friday, rulemaking for this rule. The FHWA is except Federal holidays. pleased to announce that Mr. Harter will DEPARTMENT OF TRANSPORTATION be the mediator/facilitator of the SUPPLEMENTARY INFORMATION: Commercial Driver Physical Federal Highway Administration Qualifications Negotiated Rulemaking Background 49 CFR Parts 383 and 391 Advisory Committee. On April 29, 1996, the FHWA Membership [FHWA Docket No. MC±93±23] published a notice of intent to establish In addition to a mediator/facilitator, RIN 2125±AD20 an advisory committee for regulatory negotiation to develop regulations the Committee will consist of the following members: Commercial Driver Physical governing the proposed merger of the Qualifications as Part of the State-administered commercial driver’s Federal Highway Administration Commercial Driver's License Process license procedures of 49 CFR Part 383 American Association of Motor Vehicle and the driver physical qualifications Administrators AGENCY: Federal Highway requirements of 49 CFR Part 391 (61 FR New York (State commercial driver Administration (FHWA), DOT. 18713). The notice requested comment licensing agency) Utah (State commercial driver licensing ACTION: Notice of first meeting of on membership, the interests affected by agency) negotiated rulemaking advisory the rulemaking, the issues the committee. Wisconsin (State commercial driver Committee should address, and the licensing agency) procedures it should follow. The notice SUMMARY: The FHWA announces the Montana (State commercial driver first meeting of an advisory committee also announced the May 14 public licensing agency) (the Committee) established under the meeting that was sponsored by the Commercial Vehicle Safety Alliance Federal Advisory Committee Act and agency. This organizational meeting was International Association of Chiefs of the Negotiated Rulemaking Act to held in order to help identify and select Police consider the relevant issues and attempt organizations or interests to be American Trucking Associations to reach a consensus in developing represented on the Committee. National Private Truck Council regulations governing the proposed The FHWA received 20 comments on National School Transportation merger of the State-administered the notice of intent. None of the Association commercial driver’s license (CDL) comments opposed using regulatory United Motor Coach Association & procedures of 49 CFR Part 383 and the negotiation for this rulemaking; most American Bus Association (sharing driver physical qualifications endorsed the process and included one seat on the Committee) requirements of 49 CFR Part 391. The requests to serve on the Committee and Owner Operator Independent Drivers Committee is composed of persons who submitted nominations. Based on the Association represent the interests that would be responses to the notice of intent and for Independent Truckers and Drivers Association substantially affected by the rule. the reasons the FHWA stated in that Teamsters Union DATES: notice, the Department of The first meeting of the advisory Amalgamated Transit Union committee will begin at 10:00 a.m. on Transportation has determined that Lancer Insurance August 7 and 8, 1996. establishing an advisory committee on AI Transport ADDRESSES: The first meeting of the this subject is necessary and in the American Insurance Association advisory committee will be held in the public interest. In accordance with National Association of Independent Nassif Building, U.S. Department of section 9(c) of the Federal Advisory Insurers Transportation, 400 Seventh Street, Committee Act, the Department of Advocates for Highway and Auto Safety SW., Washington, D.C. Subsequent Transportation filed the charter for this Farmland Industries meetings will be held at locations to be Committee on July 12, authorizing the American College of Occupational and announced. The Committee will meet in Committee to meet and begin Environmental Medicine room 4438 on August 7 and rooms negotiations. The Department has also Association for Advancement of 3200–3204 on August 8. selected the members of the Committee. Automotive Medicine 38134 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

American Academy of Occupational revised medical standards, using in medical information, that is not Health Nurses medical advisory panels, we find that currently available. American Academy of Physicians’ the use of this negotiated rulemaking 3. What is the status of the various Assistants forum to consider changing the current federally-funded State Prototype The FHWA regrets being unable to medical standards is inappropriate. The Medical Review pilot programs which accommodate all requests for Committee will only address whether explored the merger of the medical membership on the Committee. The the physical qualification guidelines qualifications and licensing processes, Committee must be kept to a size that currently used by the agency to and what useful information can be permits effective negotiation, but that implement the current medical utilized from these efforts in drafting a ensures all interests have a voice in the standards should be modified. rule on merging CDL and physical negotiation and any ultimate Therefore, we believe that the interests qualifications requirements? recommendations adopted. Although of disabled drivers operating in 4. How much control should various the FHWA would have preferred a interstate commerce in accordance with parties have over the medical review smaller committee, the agency erred on the Federal qualification standards will process and should the current the side of inclusion to be certain that not be significantly affected by this commonly-used procedure, in which a all interests affected by the rulemaking negotiated rulemaking in a way that is company directs its drivers to are represented in this process. different from the impacts of this action physicians it selects, be replaced The Negotiated Rulemaking Act on the total driver population. entirely or could it simply be modified? provides that agencies should limit Accordingly, the interests of these For example, should the agency require membership on a negotiated rulemaking disabled drivers are effectively drivers to submit a medical long form to committee to 25 members, unless the represented by the several driver employers and the appropriate State agency head determines that a greater organizations included on the licensing agency instead of replacing the number of members is necessary for the Committee. current system? 5. How can the current physical functioning of the committee or to The FHWA believes that public examination requirements used by achieve balanced membership. The participation is critical to the success of medical providers be clarified? How can FHWA recognizes that representation of this proceeding. Participation is not these requirements and guidelines be all significantly affected interests in the limited to Committee members. more effectively communicated to the negotiation is critical if any rule Negotiation sessions will be open to the public, so interested parties may medical provider community? developed through this process is to 6. Is there a way to allow merger of achieve widespread support. Therefore, observe the negotiations and communicate their views in the the separate requirements without to best serve all who have a significant burdening the small operator who stake in the outcome of this negotiated appropriate time and manner to Committee members. Also, interested moves to another State? In this case, rulemaking and to ensure the smooth although the driver’s medical functioning of the negotiation process, groups or individuals may have the opportunity to participate with working certification would still be valid, he or we believe that a 26-member committee she might still be required to be is necessary and justified under the groups of the Committee. The FHWA believes that this form of participation recertified in the new State, thus statutory standard cited above. potentially requiring a new certificate The agency did not grant Committee will produce meaningful information and lead to a more effective commercial and a corresponding fee (e.g. medical membership to all applicants. For reciprocity of old certificate to new example, the Georgetown University driver’s license/physical qualifications regulation. Of course, the FHWA will States). Law Center—Institute for Public Once the rulemaking negotiations are invite comment on any proposed rule Representation and the National underway, Committee members may resulting from the Committee’s Association of the Deaf requested raise other issues. membership on the Committee but were deliberations. Procedure and Schedule not included. The FHWA deliberated on Major Issues these applications and determined that Those who commented on the notice these groups sought inclusion on the In the notice of intent, the FHWA of intent generally did not address Committee primarily because of the tentatively identified potential topics to Committee procedures. The FHWA mistaken belief that the scope of these consider in the negotiation and asked anticipates that all of the negotiation negotiations would extend to a for comment on whether the issues sessions will take place in Washington, discussion of changes to the FHWA’s presented were appropriate and if D.C. at DOT headquarters. Given the physical qualifications standards. For alternate or additional issues should be FHWA’s limited resources, travel example, in its comments, the Institute considered. Most comments were outside of Washington, D.C. for the for Public Representation stated, ‘‘We devoted to membership, and no purpose of holding negotiation sessions assume from this [the April 29 notice] significant modifications to the is unlikely. that the committee will in fact consider potential topics included in the April Consistent with requirements of the the substance of the physical notice were proposed. Therefore, the list Federal Advisory Committee Act, a clear qualification standards.’’ of topics is unchanged. and comprehensive record of the However, as noted in the April 29 Those topics are: Committee’s deliberations will be kept notice, the current physical 1. Whether the physical qualifications and circulated to Committee members. qualifications standards will not be a guidelines currently used by the agency The facilitator will provide an assistant subject for discussion during this should be modified to more effectively to the Committee to complete these and negotiated rulemaking process; nor will implement the current medical other duties. the FHWA’s medical waiver programs standards. The objective of the negotiation, in be a subject for negotiation in this 2. The scope of any medical the FHWA’s view, is for the Committee proceeding. In light of the FHWA’s qualifications tracking system which to reach a consensus on how to multi-year research plan to might be used by law enforcement efficiently and successfully transfer systematically review and develop officials, as well as by carriers interested responsibility for medical fitness Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38135 determinations to State licensing the vehicle at night near traffic because to allow them to pass the vehicles agencies and produce a draft notice of the door will be reflective to oncoming safely. Further, although not required by proposed rulemaking for consideration traffic when the driver door is opened. FMVSS 108, vehicles have an interior by the agency. light that is activated when the door is Analysis of Petition: The negotiation process will proceed opened, even if the external vehicle according to a schedule of specific dates To establish a new vehicle safety lights are turned off. that the Committee devises at the first requirement, the agency must present While NHTSA is interested in any meeting. The FHWA will publish data or analysis showing that there is a suggestion that might reduce deaths, notices of future meetings in the Federal significant safety problem and that the injuries or crashes, the agency must Register. The FHWA has provided problem would likely be reduced by ensure that all new requirements are direct notice of this meeting to all adopting that requirement. The likely to enhance safety, are reasonable, Committee members and urges all petitioner did not provide any practicable and cost-effective and that members to attend and participate in information showing that a safety the safety problem is significant enough this first and important meeting. problem presently exists. He did not to warrant Federal intervention. Since Authority: 5 U.S.C. §§ 561–570; 5 U.S.C. submit any information showing the there is no information available to App. 2 §§ 1–15. frequency with which drivers or driver’s assess either the alleged safety problem Issued on: July 19, 1996. doors are struck by passing traffic. or the potential of the suggested Further, he did not provide information Stephen E. Barber, requirement for solving the problem, showing the extent to which such NHTSA must decide if it should spend Acting Associate Administrator for Motor incidents are the result of insufficient Carriers. limited agency resources to perform the conspicuity of the door or the result of [FR Doc. 96–18767 Filed 7–19–96; 12:10 pm] research and conduct the studies the suddenness with which the driver necessary to assess these matters. There BILLING CODE 4910±22±P opens his or her door into the path of could by many other measures whose an oncoming vehicle. Finally, he did not contribution to the safety of motor National Highway Traffic Safety provide any information showing vehicles could be more easily and Administration whether the incidents were more likely certainly established. to involve a solitary parked vehicle or In accordance with 49 CFR Part 552, 49 CFR Part 571 a parked vehicle whose rear end was this completes the agency’s technical obscured by another parked vehicle. Denial of Petition for Rulemaking; review of the petition. The agency has The agency also lacks any such concluded that there is no reasonable Federal Motor Vehicle Safety information. Standards possibility that the amendment In the absence of this information, the requested by the petitioner would be AGENCY: National Highway Traffic agency cannot assess whether the issued at the conclusion of a rulemaking Safety Administration (NHTSA), problem is of sufficient magnitude to proceeding. After considering all Department of Transportation. warrant rulemaking. It also can only relevant factors, including the need to ACTION: Denial of petition for very roughly assess whether the allocate and prioritize limited agency rulemaking. suggested requirement has the potential resources to best accomplish the for reducing the problem. agency’s safety mission, the agency has SUMMARY: This document denies the NHTSA has already established decided to deny the petition. petition by Mr. John Chevedden for the requirements that make parked vehicles, issuance of a mandatory Federal particularly solitary parked vehicles, Authority: 49 U.S.C. 30103, 30111, 30162; delegations of authority at 49 CFR 1.50 and regulation that would require all new more conspicuous to following traffic. cars, light trucks and sport utility 501.8. FMVSS 108 requires that vehicles be Issued on: July 17, 1996. vehicles to be equipped with reflectors equipped with rear taillamps, Barry Felrice. or reflective tape on the open driver side stoplamps, high mounted center door or door jamb. An analysis of the stoplamps, license plate lamps, and Associate Administrator for Safety Performance Standards. petition revealed no information to parking lamps. These lamps add to a support the petitioner’s contention that vehicle’s conspicuity when its lights are [FR Doc. 96–18697 Filed 7–22–96; 8:45 am] there is a safety problem with the turned on. The agency recognizes that to BILLING CODE 4910±59±P current situation and that his proposed the extent that drivers exit from their solution will address the problem and vehicles at night only after turning off 49 CFR Part 571 improve safety in a cost-effective way. the vehicle lights, these lamps will not FOR FURTHER INFORMATION CONTACT: be of any assistance in making the Denial of Petition for Rulemaking; Kenneth O. Hardie, Safety Performance stopped vehicle conspicuous. Federal Motor Vehicle Safety Standards, NHTSA, 400 Seventh Street, However, FMVSS 108 also contains a Standards SW, Washington, D.C. 20590. Mr. requirement that enhances the AGENCY: National Highway Traffic Hardie’s telephone number is (202) 366– conspicuity of vehicles whose lights are Safety Administration (NHTSA), 6987. turned off. The Standard requires that Department of Transportation. SUPPLEMENTARY INFORMATION: By letter the rear of all cars, and multipurpose ACTION: Denial of petition for dated March 29, 1996, Mr. John passenger vehicles and trucks less than rulemaking. Chevedden of Redondo Beach, 80 inches overall width, be equipped California, petitioned NHTSA to issue a with two red reflex reflectors, on each SUMMARY: This document denies Mr. new rule that would mandate the side of the vehicle centerline. These John Chevedden’s petition for equipping of all new cars, light trucks reflectors are required to be as far apart rulemaking to require that all manual and sport utility vehicles with reflectors as possible. The intent of requiring these transmission cars, trucks, and sport or reflective tape on the open driver side reflectors is to make these vehicles more utility vehicles be manufactured with door or door jamb. The petitioner stated visible, especially at times of reduced the ‘‘Hill-Holder’’ innovation which is that this will avoid collisions with lighting, so that oncoming drivers will found as standard equipment on the drivers and their car doors as they exit ensure that there is sufficient separation Subaru Legacy. Mr. Chevedden claims 38136 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules that this action will enhance safety by that the type of collision in question vehicles-in-use, and the interactions of preventing backward travel collisions causes any injuries or even causes any drivers with their vehicles. The agency’s on hills during start-up from a stop sign damage that might lead to injury- limited resources for addressing pre- or signal. Mr. Chevedden contends that causing collisions at a later time. The crash safety will be devoted to the ‘‘Hill-Holder’’ prevents cars from collisions, if any, directly prevented by implementing these measures based on slipping backwards on hills during the Hill-Holder are very low speed their potential contribution to safety. clutch release and accelerator collisions, too low to have any injury Even with additional resources, it application. He believes this will reduce potential. Further, they are unlikely to would not be possible or appropriate for collisions with vehicles waiting behind. cause any damage of safety significance. the agency to address every measure NHTSA’s analysis of the petition They are particularly unlikely to cause believed by a petitioner to have a concludes that there is no evidence of damage to passenger cars because of the possible connection with pre-crash a significant safety problem that would protective capability required of safety. Given that the agency does not warrant federal intervention and such a passenger car bumpers by 49 CFR Part believe that the suggested action would mandate. 580. Part 580 requires that passenger car enhance safety, NHTSA cannot devote FOR FURTHER INFORMATION CONTACT: Mr. bumpers provide protection against its resources to pursuing it. Jere Medlin, Office of Safety property damage in impacts up to 2.5 In accordance with 49 CFR part 552, Performance Standards, NHTSA, 400 miles per hour. Most cars have bumpers this completes the agency’s technical Seventh Street, SW, Washington, DC that far exceed the standard. review of the petition. The agency has 20590. Mr. Medlin’s telephone number The agency notes further that any concluded that there is no reasonable is: (202) 366–5276. His facsimile motorist uncomfortable with operating a possibility that the amendment number is (202) 366–4329. manual transmission vehicle on hills requested by the petitioner would be SUPPLEMENTARY INFORMATION: By letter has ample opportunity to buy an issued at the conclusion of a rulemaking dated February 6, 1996, Mr. John automatic transmission vehicle. Over 80 proceeding. After considering all Chevedden of Redondo Beach, percent of light vehicles (i.e., those relevant factors, including the need to California, petitioned the agency to under 8,500 pounds gross vehicle allocate and prioritize limited agency issue a rule that would require weight rating) have automatic resources to best accomplish the equipping all manual transmission cars, transmissions. According to 1995 agency’s safety mission, the agency has trucks, and sport utility vehicles with a vehicle production data submitted to decided to deny the petition. ‘‘Hill-Holder’’ device (currently found the agency under the Corporate Average on the Subaru Legacy) to enhance safety Fuel Economy Program, only 16.7 Authority: 49 U.S.C. 30103, 30162; delegation of authority at 49 CFR 1.50 and by preventing backward travel collisions percent of passenger cars and 21.2 501.8. on hills during start-up from a stop sign percent of light trucks were equipped or signal. with manual transmissions. Issued on: July 17, 1996. Mr. Chevedden did not provide any The agency has just issued a Barry Felrice, support for his suggestion that the Hill- comprehensive Crash Avoidance Associate Administrator for Safety Holder will enhance safety. He provided Implementation Plan listing the Performance Standards. no information suggesting that the Hill- agency’s priorities for improving the [FR Doc. 96–18692 Filed 7–22–96; 8:45 am] Holder would prevent any collisions or pre-crash safety of new vehicles and BILLING CODE 4910±59±P 38137

Notices Federal Register Vol. 61, No. 142

Tuesday, July 23, 1996

This section of the FEDERAL REGISTER Natural Resources Conservation The ESCO plant (70,000 sq.ft./25 contains documents other than rules or Service acres) is located at 2340 Roberts Street, proposed rules that are applicable to the Muskegon (Muskegon County), public. Notices of hearings and investigations, Notice of Extension of Deadline for Michigan. The facility produces committee meetings, agency decisions and Nominations for Board of Trustees pigment/dye-type chemicals known as rulings, delegations of authority, filing of ‘‘colorformers’’, which are used in the petitions and applications and agency SUMMARY: The Secretary of Agriculture statements of organization and functions are is extending the period for nominations manufacture of pressure and heat- examples of documents appearing in this for persons to serve as members of the sensitive paper such as that used for section. National Natural Resources thermal fax machines. The main Conservation Foundation Board of products currently manufactured at the Trustees. The original notice dated June plant are: Black XV, N–102 and YK–2 DEPARTMENT OF AGRICULTURE 14, 1996 had set the deadline at July 15, (HTS 3204.12.5000—17.3%) and ODB– 1996. 2 (HTS 3204.19.4000—13.3%). Some 20 Forest Service percent of production will be exported. DATES: Written nominations will be Zone procedures would exempt ESCO Willamette Provincial Interagency received before September 1, 1996. from Customs duty payments on foreign Executive Committee (PIEC), Advisory ADDRESSES: Send written nominations Committee materials used in production for export. to Chief, Natural Resources On domestic shipments, the company Conservation Service, USDA, P.O. Box AGENCY: Forest Service, USDA. would be able to defer duty on foreign- 2890, Washington, D.C. 20013. sourced inputs until formal Customs ACTION: Notice of meeting. FOR FURTHER INFORMATION CONTACT: entry is made. Foreign-sourced inputs Doug McKalip, Legislative Affairs include aniline derivative (HTS SUMMARY: The Willamette PIEC Division, Natural Resources 2921.49.1000—5.8%), diphenylamine Advisory Committee will meet on Conservation Service; (202) 720–2771. (HTS 2921.44.2000—12.1%), m- Thursday, August 15, 1996. The meeting SUPPLEMENTARY INFORMATION: aminophenol (HTS 2922.29.1000— will be held in Conference Room ‘‘A/B’’ Applicants should reference Federal 5.8%) and diethyl-m-aminophenol (HTS of the US Forest Service; Mt. Hood Register Vol. 61, No. 116, page 30215 2922.29.1500—6.7%). National Forest; 2955 NW Division (Friday June 14, 1996) for instructions. The application indicates that the Street; Gresham, Oregon 97030; phone Paul W. Johnson, (503) 666–0700. The meeting is savings from zone procedures will help Chief. scheduled to begin at 9:00 a.m. and improve the international conclude at approximately 3:00 p.m. [FR Doc. 96–18557 Filed 7–22–96; 8:45 am] competitiveness of the ESCO plant and Topics tentatively scheduled on the BILLING CODE 3410±16±M will help increase exports. agenda include: (1) Report from PAC In accordance with the Board’s Subcommittee on flood assessment, (2) regulations, a member of the FTZ Staff Discussion of priorities for flood DEPARTMENT OF COMMERCE has been designated examiner to restoration projects and funding, (3) investigate the application and report to Review of Province monitoring results, Foreign-Trade Zones Board the Board. (4) Update on current events and issues [Docket 57±96] Public comment is invited from by agency managers, (5) Public forum. interested parties. Submissions (original The meeting is open to the public and Foreign-Trade Zone 189ÐMuskegon, and 3 copies) shall be addressed to the opportunity will be available to address Michigan; Application for Subzone Board’s Executive Secretary at the the Advisory Committee during the Status ESCO Company Limited address below. The closing period for public forum. Time allotted for Partnership (Colorformer/Pigment/Dye their receipt is September 23, 1996. individual presentations to the Chemicals) Muskegon, MI Rebuttal comments in response to material submitted during the foregoing committee will be limited to 3–5 An application has been submitted to period may be submitted during the minutes each. Written comments are the Foreign-Trade Zones Board (the subsequent 15-day period (to October 7, encouraged and can be submitted prior Board) by the KOM Foreign Trade Zone 1996). to the meeting. Authority, grantee of FTZ 189, A copy of the application and FOR FURTHER INFORMATION CONTACT: requesting special-purpose subzone accompanying exhibits will be available For more information regarding this status for the colorformer chemicals manufacturing facility of ESCO for public inspection at each of the meeting, contact Designated Federal following locations: Official Neal Forrester, Willamette Company Limited Partnership (ESCO) National Forest, 211 East Seventh (jointly owned by Mitsui Toatsu U.S. Department of Commerce Export Avenue; Eugene, Oregon 97401; (541) Chemicals and Yamamoto Chemicals Assistance Center, 301 W. Fulton St., 465–6924. (Japan)), in Muskegon, Michigan. The Suite 718, Grand Rapids, Michigan application was submitted pursuant to 49503–6495 Dated: July 17, 1996. the provisions of the Foreign-Trade Office of the Executive Secretary, Maurica Owen, Zones Act, as amended (19 U.S.C. 81a– Foreign-Trade Zones Board, U.S. Supervisory Contract Specialist. 81u), and the regulations of the Board Department of Commerce Room 3716, [FR Doc. 96–18589 Filed 7–22–96; 8:45 am] (15 CFR part 400). It was formally filed 14th and Pennsylvania Avenue NW., BILLING CODE 3412±11±M on July 8, 1996. Washington, DC 20230. 38138 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Dated: July 16, 1996. terminate, we no longer intend to revoke A–588–706 John J. Da Ponte, Jr., these antidumping duty orders and Japan Executive Secretary. findings or to terminate the suspended Nitrile Rubber [FR Doc. 96–18674 Filed 7–22–96; 8:45 am] investigations. Objection Date: June 19, 1996 BILLING CODE 3510±DS±P Antidumping Proceeding Objector: Zeon Chemicals Inc. Contact: Sheila Forbes at (202) 482– A–423–077 5253. International Trade Administration Belgium A–401–040 Sugar Determination not to Revoke Objection Date: June 27, 1996–June 28, Sweden Antidumping Duty Orders and 1996 Stainless Steel Plate Findings nor to Terminate Suspended Objector: Florida Sugar Marketing and Objection Date: June 12, 1996 Investigations Terminal Association, Inc., U.S. Beet Objector: Allegheny Ludlum Steel AGENCY: Import Administration, Sugar Association, U.S. Cane Sugar Corporation, Armco Inc., G.O. International Trade Administration, Refiners’ Association Carlson, Inc., Lukens-Washington Department of Commerce. Contact: Lyn Johnson at (202) 482–5287. Operations Contact: Michael Heaney at (202) 482– ACTION: Determination not to Revoke A–427–078 4475. Antidumping Duty Orders and Findings nor to Terminate Suspended France A–583–080 Investigations. Sugar Objection Date: June 27, 1996–June 28, Taiwan SUMMARY: The Department of Commerce 1996 Carbon Steel Plate is notifying the public of its Objector: Florida Sugar Marketing and Objection Date: June 28, 1996 determination not to revoke the Terminal Association, Inc., U.S. Beet Objector: Bethlehem Steel Corporation, antidumping duty orders and findings Sugar Association, U.S. Cane Sugar U.S. Steel Group nor to terminate the suspended Refiners’ Association Contact: Michael Heaney at (202) 482– investigations listed below. Contact: Lyn Johnson at (202) 482–5287. 4475. EFFECTIVE DATE: July 23, 1996. A–428–802 A–583–505 FOR FURTHER INFORMATION CONTACT: Germany Taiwan Michael Panfeld or the analyst listed Oil Country Tubular Goods under Antidumping Proceeding at: Industrial Belts and Components and Parts Thereof, Whether Cured or Objection Date: June 24, 1996 Import Administration, International Objector: North Star Steel Company Trade Administration, U.S. Department Uncured, Except Synchronous & V belts Contact: Michael Heaney at (202) 482– of Commerce, 14th Street & Constitution 4475 Avenue, NW., Washington, DC 20230. Objection Date: June 25, 1996 Objector: Gates Rubber Company Dated: July 11, 1996. SUPPLEMENTARY INFORMATION: The Contact: Ron Trentham at (202) 482– Barbara R. Stafford, Department of Commerce (the 4793. Department) may revoke an Deputy Assistant Secretary for AD/CVD Enforcement. antidumping duty order or finding or A–428–061 terminate a suspended investigation, [FR Doc. 96–18673 Filed 7–22–96; 8:45 am] Germany BILLING CODE 3510±DS±P pursuant to 19 CFR 353.25(d)(4)(iii), if Precipitated Barium Carbonate no interested party has requested an Objection Date: June 18, 1996 administrative review for four Objector: Chemical Products [A±351±820] consecutive annual anniversary months Corporation and no domestic interested party objects Contact: Tom Futtner at (202) 482–3814. Ferrosilicon From Brazil; Affirmation of to the revocation or requests an the Results of Redetermination administrative review. A–428–082 Pursuant to Court Remand We had not received a request to Germany conduct an administrative review for SUMMARY: On May 21, 1996, the United Sugar States Court of International Trade (the the most recent four consecutive annual Objection Date: June 27, 1996–June 28, anniversary months. Therefore, Court) affirmed the Department of 1996 Commerce’s (the Department’s) pursuant to § 353.25(d)(4)(i) of the Objector: Florida Sugar Marketing and Department’s regulations, on June 7, redetermination on remand of the Final Terminal Association, Inc., U.S. Beet Determination of Sales at Less Than 1996, we published in the Federal Sugar Association, U.S. Cane Sugar Register a notice of intent to revoke Fair Value: Ferrosilicon From Brazil (59 Refiners’ Association FR 732, January 6, 1994) and the these antidumping duty orders and Contact: Mark Ross at (202) 482–4852. findings and to terminate the suspended Amended Final Determination of Sales investigations and served written notice A–475–802 at Less Than Fair Value: Ferrosilicon of the intent to each domestic interested Italy From Brazil (59 FR 8598, February 23, party on the Department’s service list in Industrial Belts and Components and 1994). See Aimcor et al. v. United States each case. Within the specified time Parts Thereof, Whether Cured or et al., Slip Op. 96–79 (CIT May 21, frame, we received objections from Uncured 1996). domestic interested parties to our intent Objection Date: June 25, 1996–June 28, EFFECTIVE DATE: July 23, 1996. to revoke these antidumping duty orders 1996 FOR FURTHER INFORMATION CONTACT: and findings and to terminate the Objector: Gates Rubber Company, Katherine Johnson or James Terpstra at suspended investigations. Therefore, Mectrol Corporation (202) 482–4929 or (202) 482–3965, because domestic interested parties Contact: Ron Trentham at (202) 482– respectively, Investigations Office, objected to our intent to revoke or 4793. Import Administration, International Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38139

Trade Administration, U.S. Department on ferrosilicon from Brazil to reflect as affiliate TKS USA; and the petitioner, of Commerce, 14th Street and follows the amended margins in the Rockwell Graphics Systems Inc. and its Constitution Avenue, N.W., Department’s redetermination on parent company, Rockwell International Washington, D.C. 20230. remand: Minasligas 19.73 percent; Corporation, requested disclosure of the Companhia Brasileira Carbureto de Department’s calculation methodologies SUPPLEMENTARY INFORMATION: Calcio 17.93 percent; and All Others used in the preliminary determination. Background 42.17 percent. Liquidation of such On March 4, 1996, the petitioner alleged On July 20, 1995, the Court issued an entries is suspended pending final and that the Department made two order remanding to the Department the conclusive affirmance of these remand ministerial errors in its calculation with final determination and amended final results. respect to constructed value (‘‘CV’’) and determination on ferrosilicon from Dated: July 10, 1996. further manufacturing costs. The Brazil. See Aimcor et al. v. United States Jeffrey P. Bialos, Department determined that neither of the allegations constituted ministerial et al., Slip Op. 95–130 (CIT July 20, Deputy Assistant Secretary for Import 1995) (AIMCOR I). Administration. errors. (See Memorandum from the Team to Richard W. Moreland, March In its decision in Timken Co., v. [FR Doc. 96–18672 Filed 7–22–96; 8:45 am] 11, 1996.) United States, 893 F.2d 337 (Fed. Cir. BILLING CODE 3510±DS±P 1990) (Timken), the United States Court On February 27, 1996, the Department of Appeals for the Federal Circuit held issued supplemental sales questionnaire that, pursuant to 19 U.S.C. 1516a(e), the [A±588±837] to MHI and TKS. On March 7, 1996, the Department must publish a notice of a respondents submitted their responses court decision that is not ‘‘in harmony’’ Notice of Final Determination of Sales to the supplemental sales questionnaire. with a Department determination, and at Less Than Fair Value: Large On March 5, 1996, the Department must suspend liquidation of entries Newspaper Printing Presses and issued a supplemental cost pending a ‘‘conclusive’’ court decision. Components Thereof, Whether questionnaire to TKS and on March 8, In AIMCOR I, the Court ordered the Assembled or Unassembled, From 1996, TKS submitted its response. Department to do the following: (1) Japan In March and April 1996, we conducted verification of the sales and Determine if the amount of the ‘‘spread’’ AGENCY: Import Administration, (the difference between the interest rate cost questionnaire responses of the International Trade Administration, respondents in Japan and the United and the inflation rate) is sufficiently Department of Commerce. quantified and, if so, account for this States. EFFECTIVE DATE: July 23, 1996. On May 8, 1996, the Department amount in the home market price, or, if FOR FURTHER INFORMATION CONTACT: Bill received comments it solicited from not, grant Companhia Ferroligas Minas Crow or Dennis McClure, Office of AD/ interested parties in its preliminary Gerais (Minasligas) an opportunity to CVD Enforcement, Import determination regarding scope issues. provide such data; (2) reconsider the Administration, International Trade On May 31, 1996, respondents profit calculation in constructed value Administration, U.S. Department of submitted new sales and cost databases and explain the rationale for whatever Commerce, 14th Street and Constitution which incorporated factual corrections methodology the Department chooses to Avenue, NW., Washington, D.C. 20230; noted during verification. apply; (3) apply a U.S. dollar- Telephone: (202) 482–0116 or (202) The respondents and the petitioner denominated interest rate in calculating 482–3530, respectively. submitted case briefs on June 3, 1996 Minasligas’ imputed U.S. credit and rebuttal briefs on June 10, 1996. The The Applicable Statute expenses; (4) request from Minasligas Department held a public hearing for data on the appropriate monetary Unless otherwise indicated, all this investigation on June 17, 1996. On correction for loans, and if that data is citations to the Tariff Act of 1930 (‘‘the June 19, 1996, MHI protested that inadequate or not provided, to Act’’) are references to the provisions certain elements of the petitioner’s reconsider our selection of best effective January 1, 1995, the effective rebuttal brief contained new factual information available, and also to date of the amendments made to the Act information. On June 20, 1996, the reconsider whether the Department’s by the Uruguay Rounds Agreements Act petitioner objected to MHI’s complaint. interest expense adjustment and the (‘‘URAA’’). On June 26, 1996, the Department selection, if any, of an adjustment for Final Determination returned the rebuttal brief to the monetary correction for loans understate petitioner, and notified the petitioner Minasligas’ interest expenses included We determine that large newspaper that the new material to which MHI had in cost of production and constructed printing presses and components objected should be removed from the value; and (5) determine whether thereof (‘‘LNPPs’’) from Japan are being, record of the investigation. The Minasligas’ value-added taxes on the or are likely to be, sold in the United petitioner submitted a revised rebuttal inputs at issue were fully recovered States at less than fair value (‘‘LTFV’’), brief on June 27, 1996. prior to exportation of the subject as provided in section 735 of the Act. merchandise. Scope of Investigation Case History These remand instructions constitute Note: The following scope language reflects a decision not in harmony with the Since the preliminary determination certain modifications from the notice of the Department’s final determination and on February 23, 1996 (60 FR 8029, preliminary determination. As specified amended final determination. This March 1, 1995), the following events below, we have clarified the scope to include notice fulfills the publication have occurred: incomplete LNPP systems, additions and requirements of Timken. On February 26 and 27, 1996, the components. We have also clarified the scope Absent an appeal, or, if appealed, respondents, Mitsubishi Heavy to include ‘‘elements’’ (otherwise referred to as ‘‘parts’’ or ‘‘subcomponents’’) of a LNPP upon a ‘‘conclusive’’ court decision Industries Ltd. (‘‘MHI’’) and its U.S. system, addition or component, which taken affirming the Court’s opinion, the affiliate Mitsubishi Lithographic altogether constitute at least 50 percent of the Department will amend the amended Printing (‘‘MLP’’); Tokyo Kikai cost of manufacture of the LNPP component final determination of the investigation Seisakusho Ltd. (‘‘TKS’’) and its U.S. of which they are a part. We have also 38140 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices excluded from the definition of the five shipped either partially assembled or for convenience and Customs purposes, subject LNPP components any reference to unassembled, complete or incomplete, our written description of the scope of specific subcomponents (i.e., the reference to and are assembled and/or completed this investigation is dispositive. a printing-unit cylinder in the definition of prior to and/or during the installation a LNPP printing unit). In addition, we have Scope Comments process in the United States. Any of the excluded the following Harmonized Tariff We have included scope issues for System of the United States (‘‘HTSUS’’) five components, or collection of subheadings from the scope: 8524.51.30, components, the use of which is to this investigation and the concurrent 8524.52.20, 8524.53.20, 8524.91.00, and fulfill a contract for large newspaper investigation of LNPP from Germany in 8524.99.00. See ‘‘Scope Comments’’ section printing press systems, press additions, the Final Determination of Sales at Less of this notice and the July 15, 1996 Decision or press components, regardless of Than Fair Value: Large Newspaper Memorandum to Barbara Stafford from The degree of assembly and/or degree of Printing Presses and Components Team Re: Scope Issues in the Final combination with non-subject elements Thereof, Whether Assembled or Determinations. before or after importation, is included Unassembled, from Germany (‘‘LNPP Scope: The products covered by these in the scope of this investigation. Also from Germany’’). The issues are investigations are large newspaper included in the scope are elements of a voluminous and the resolution of these printing presses, including press LNPP system, addition or component, issues affects both investigations systems, press additions and press which taken altogether, constitute at equally, as reflected in the universal components, whether assembled or least 50 percent of the cost of comment period in the public hearing unassembled, whether complete or manufacture of any of the five major on LNPP scope. We have therefore incomplete, that are capable of printing LNPP components of which they are a utilized the German FR Notice as the or otherwise manipulating a roll of part. vehicle to publish the scope comments paper more than two pages across. A For purposes of this investigation, the from all interested parties in both page is defined as a newspaper following definitions apply irrespective investigations. broadsheet page in which the lines of of any different definition that may be Period of Investigation type are printed perpendicular to the found in Customs rulings, U.S. Customs running of the direction of the paper or law or the HTSUS: the term The POI for MHI is July 1, 1991 a newspaper tabloid page with lines of ‘‘unassembled’’ means fully or partially through June 30, 1995, and July 1, 1992 through June 30, 1995 for TKS. See: type parallel to the running of the unassembled or disassembled; and (2) Preliminary Determination of Sales at direction of the paper. the term ‘‘incomplete’’ means lacking In addition to press systems, the one or more elements with which the LTFV: Large Newspaper Printing Presses scope of these investigations includes LNPP is intended to be equipped in and Components Thereof, Whether the five press system components. They order to fulfill a contract for a LNPP Assembled or Unassembled, from Japan, are: system, addition or component. 60 FR 8029 (March 1, 1995) (‘‘LNPPs (1) A printing unit, which is any This scope does not cover spare or from Japan Preliminary component that prints in monocolor, replacement parts. Spare or replacement Determination’’). spot color and/or process (full) color; parts imported pursuant to a LNPP Product Comparisons (2) A reel tension paster (‘‘RTP’’), contract, which are not integral to the Although the home market was which is any component that feeds a original start-up and operation of the viable, in accordance with section 773 roll of paper more than two newspaper LNPP, and are separately identified and of the Act, we based normal value broadsheet pages in width into a subject valued in a LNPP contract, whether or (‘‘NV’’) on constructed value (‘‘CV’’) printing unit; not shipped in combination with (3) A folder, which is a module or covered merchandise, are excluded from because we determined that the combination of modules capable of the scope of this investigation. Used particular market situation, which cutting, folding, and/or delivering the presses are also not subject to this requires that the subject merchandise be paper from a roll or rolls of newspaper scope. Used presses are those that have built to each customer’s specifications, broadsheet paper more than two pages been previously sold in an arm’s length does not permit proper price-to-price in width into a newspaper format; transaction to a purchaser that used comparisons. See: Preliminary (4) Conveyance and access apparatus them to produce newspapers in the Determination: LNPPs from Japan. capable of manipulating a roll of paper ordinary course of business. Fair Value Comparisons more than two newspaper broadsheet Further, this investigation covers all To determine whether MHI’s and pages across through the production current and future printing technologies TKS’s sales of LNPPs to the United process and which provides structural capable of printing newspapers, States were made at less than fair value, support and access; and including, but not limited to, (5) A computerized control system, lithographic (offset or direct), we compared Constructed Export Price which is any computer equipment and/ flexographic, and letterpress systems. (‘‘CEP’’) to the NV, as described in the or software designed specifically to The products covered by this ‘‘Constructed Export Price’’ and control, monitor, adjust, and coordinate investigation are imported into the ‘‘Normal Value’’ sections of this notice. the functions and operations of large United States under subheadings In accordance with section newspaper printing presses or press 8443.11.10, 8443.11.50, 8443.30.00, 777A(d)(1)(A)(ii), we calculated components. 8443.59.50, 8443.60.00, and 8443.90.50 transaction-specific CEPs (which in this A press addition is comprised of a of the HTSUS. Large newspaper printing case were synonymous with model- union of one or more of the press presses may also enter under HTSUS specific CEPs) for comparison to components defined above and the subheadings 8443.21.00 and 8443.40.00. transaction-specific NVs. equipment necessary to integrate such Large newspaper printing press Constructed Export Price (‘‘CEP’’) and components into an existing press computerized control systems may enter Further Manufacturing (‘‘FM’’) system. under HTSUS subheadings 8471.49.10, Because of their size, large newspaper 8471.49.21, 8471.49.26, 8471.50.40, TKS printing press systems, press additions, 8471.50.80, and 8537.10.90. Although TKS reported its sales as CEP and and press components are typically the HTSUS subheadings are provided CEP/FM sales. Because we have Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38141 classified installation expenses as a broad range of activities including accordance with section 773(e) of the further manufacturing, we have treated purchasing parts, warranty, technical Act, we calculated CV based on the sum all TKS sales as CEP/FM sales. We services, and the coordination of of each respondent’s materials and calculated CEP, in accordance with installation, which we have classified as fabrication costs plus amounts for subsections 772(b) and (d) of the Act, for further manufacturing. We calculated selling, general and administrative (1) Those sales to the first unaffiliated CEP, in accordance with subsections (‘‘SG&A’’) expenses, U.S. packing costs. purchaser that took place after 772 (b) and (d) of the Act, for these sales We based CV on the same methodology importation by a seller affiliated with because they involved further used in the preliminary determination, the producer/exporter, and (2) those manufacturing in the United States. with the following exceptions: sales involving further manufacturing in We calculated CEP based on the same the United States. methodology used in the preliminary TKS We calculated CEP based on the same determination, with the following (1) We adjusted TKS USA’s SG&A and methodology used in the preliminary exceptions: indirect overhead costs in accordance determination, with the following (1) We treated post-sale warehousing with the submitted reclassification of exceptions: in Japan as a movement charge and not rent, workmen’s compensation and (1) We deducted those indirect selling as a direct selling expense; employee insurance. expenses that were associated with (2) We deducted the unpaid portion of (2) We recalculated CEP profit to economic activity in the United States, the total contract price from the gross include packing, transportation and whether incurred in the United States or price of the Guard sale as a discount. installation costs. in Japan, and irrespective of where The proprietary details of this (3) We modified our calculation of recorded. We revised the reported adjustment do not allow further TKS USA’s further manufacturing G&A indirect selling expense ratio to include elaboration; the July 15, 1996, MHI rate by excluding the inputs acquired all Japanese indirect selling expenses in calculation memo records the from TKS. the numerator and allocated this methodology. amount over the total value of TKS sales (3) We deducted those indirect selling MHI to be applied to U.S. sales value, not expenses that were associated with (1) We recalculated MLP’s G&A rate transfer prices; TKS had previously economic activity in the United States, using the cost of goods sold (‘‘CGS’’) excluded branch sales office expenses whether incurred in the United States or incurred in the United States and from the numerator and included some in Japan, and irrespective of where applied that rate to further transfer prices in the denominator. We recorded. We also calculated these manufacturing costs for each U.S. sale. also calculated these indirect selling indirect selling expenses in accordance (2) We recalculated home market expenses in accordance with the with the methodology explained in the profit to reflect the deduction of freight methodology explained in the DOC DOC Position to Comment 1 of the costs. Position to Comment 1 of the ‘‘Common ‘‘Common Issues’’ subsection of the (3) We recalculated CEP profit to Issues’’ subsection of the ‘‘Interested ‘‘Interested Party Comments’’ section of reflect the deduction of home market Party Comments’’ section of the final the final notice of the companion packing costs. notice of the companion investigation of investigation of LNPP from Germany. (4) We reallocated MHI’s R&D costs to LNPP from Germany. (4) We modified the calculation of all LNPP contracts based on the relative (2) We recalculated TKS’s reported MLP’s reported indirect selling manufacturing costs incurred for each indirect selling expenses incurred in the expenses to no longer include an contract. United States using the total expenses allocation of common G&A expenses, (5) We adjusted NV to include the loss and total revenue for TKS USA during since total G&A applicable to LNPP is on sale of obsolete LNPP inventory. the fiscal years 1991 through 1995, in accounted for in the calculation of Price to CV Comparisons order to remove distortions in TKS further manufacturing costs. USA’s financial statements caused by (5) We have modified the calculation For CEP to CV comparisons, we auditors’ modifications to revenue of MHI’s indirect selling expenses deducted from CV the weighted-average recognized during the POI. Our revision incurred in the United States but home market direct selling expenses, included additional selling expenses recorded in Japan to remove the salary pursuant to section 773(a)(8) of the Act. and excluded common G&A, as detailed expenses for an MLP employee where Verification in our July 15, 1996, calculation those expenses were already accounted memorandum. for in the calculation of the MLP As provided in section 782(i) of the (3) We recalculated the U.S. insurance indirect selling expenses. Act, we conducted verification of the premiums expenses for both marine (6) We excluded from the calculation information submitted by the insurance and for U.S. inland insurance, of the Guard commission those respondent. We used standard increasing the amounts reported to additional revenues remitted to MLP by verification procedures, including match the acceptable loss/premium Sumitomo Corporation (‘‘SC’’) from the examination of relevant accounting and ratio established by Yasuda Fire and total interest income earned while SC sales records and original source Marine Insurance in its official collected and held payment from Guard. documents provided by the respondent. correspondence. (7) We increased the amount of the Currency Conversion spare parts adjustment to the Piedmont MHI gross price in order to account for the Section 773A(a) of the Act directs the Although MHI reported its sales as EP value of materials supplied by MHI for Department to convert foreign sales, we reclassified all MHI sales as the Piedmont sale in excess of the currencies based on the dollar exchange CEP/FM sales because MHI’s affiliated contracted value of spare parts. rate in effect on the date of sale of the U.S. sales agent acted as more than a subject merchandise, except if it is processor of sales-related Normal Value/Constructed Value established that a currency transaction documentation and a communication For the reasons outlined in the on forward markets is directly linked to link with the unaffiliated U.S. ‘‘Product Comparisons’’ section of this an export sale. When a company customers. The U.S. affiliate engaged in notice, we based NV on CV. In demonstrates that a sale on forward 38142 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices markets is directly linked to a particular Common Issues for LNPP From Japan TKS maintains that TKS’s home market export sale in order to minimize its Sales Issue LNPP sales involve only one type of exposure to exchange rate losses, the customer—newspaper publishing Department will use the rate of Comment 1 CEP Offset: As noted in companies, and only one channel of exchange in the forward currency sale the Common Issues section of the distribution—direct sales to those agreement. In this case, although MHI German notice, MHI argues that its sales publishing companies. According to reported that forward currency should be treated as EP sales and not as TKS, the sales and distribution process exchange contracts applied to certain CEP sales. Further, MHI argues that if a for all these sales is straightforward, as U.S. sales, we verified that these CEP analysis is applied, then the TKS’s own specialized sales force contracts were linked to certain Department must consider a CEP offset initiates and maintains customer payments, not to the particular dates of to MHI’s NV. MHI claims that the relations. sale of the contracts (and thereby to Department will not look to the initial According to TKS, all of its U.S. sales calculation exchange rates) in question. sales price for CEP sales, but will involve a single type of customer— See May 14, 1996, MHI Verification instead look to the price as calculated newspaper publishers, and a single Report at 9. Therefore, for the purpose after CEP adjustments are made to make channel of distribution—customer- of the final determination, we made level-of-trade (‘‘LOT’’) comparisons. direct sales. TKS states that it is currency conversions into U.S. dollars MHI explains the statute recognizes undisputed that TKS’s U.S. sales are based on the official exchange rates in that, in certain cases, while sales may CEP sales due to the numerous critical have been made at different levels of effect on the dates of the U.S. sales as activities performed by its subsidiary, trade, the data may not exist to make an certified by the Federal Reserve Bank. TKS USA. According to TKS, it is the LOT adjustment. According to MHI, CEP adjusted for the various expenses Section 773A(a) directs the comparing CEP to an unadjusted NV related to such activities which Department to use a daily exchange rate would not result in the ‘‘fair determines the level of trade of a CEP in order to convert foreign currencies comparison’’ mandated by the statute. sale. into U.S. dollars, unless the daily rate Thus, MHI states that in order to make TKS states that after the adjustments involves a ‘‘fluctuation.’’ For this final a fair comparison, the statute allows for mandated by section 772(d) are determination, we have determined that a deduction of indirect selling expenses completed, the level of trade of its CEP a fluctuation exists when the daily from the NV by an amount not more sales is nearer to the factory gate than exchange rate differs from the than the amount of U.S. indirect selling the level of TKS’s customer-direct home benchmark rate by 2.25 percent. The expenses. market sales, because the Act requires benchmark is defined as the rolling MHI states that, if the Department the deduction of all the direct and average of rates for the past 40 business continues to use CEP analysis for indirect selling expenses included in days. When we determined that a purposes of the final determination, an the CEP sale. Maintaining that the level fluctuation existed, we substituted the LOT adjustment would be warranted of trade for the NV calculation is a CV benchmark for the daily rate. Further, because of the activities that would be that includes both direct and indirect section 773A(b) directs the Department removed from the CEP. According to selling expenses, TKS contends that its to allow a 60-day adjustment period MHI’s interpretations, because a CEP home market sales, in comparison with when a currency has undergone a analysis implies that MLP’s economic adjusted CEP sales, are at a more remote sustained movement. A sustained activities are significant, removing the stage of distribution. Thus, TKS argues, movement has occurred when the expenses incurred for such activities it is entitled to a CEP offset. weekly average of actual daily rates would likely change the level of trade at In complete disagreement with the exceeds the weekly average of which CEP is calculated. Furthermore, respondents, the petitioner maintains benchmark rates by more than five MHI maintains that a CEP analysis that no CEP offset is warranted in this percent for eight consecutive weeks. would remove from U.S. price all of investigation. It argues that MHI and (For an explanation of this method, see MHI’s U.S. economic activity as well, TKS have failed to establish that NV and Policy Bulletin 96–1: Currency further necessitating an LOT CEP were at different levels of trade. Conversions, 61 FR 9434, March 8, adjustment, since the starting price for The petitioner points out that MHI had 1996.) Such an adjustment period is MHI’s U.S. sales and home market sales maintained up until verification that no required only when a foreign currency is at the same level of trade, i.e., direct LOT adjustment was required, and that is appreciating against the U.S. dollar. to the end-user. MHI maintains that TKS had only asserted in a footnote to The use of an adjustment period was not since there is no data on the record to one of its responses that it was entitled warranted in this case because the yen make an actual LOT adjustment, the to a CEP offset. Given that neither did not undergo a sustained movement Department should make a CEP offset respondent substantiated the necessity of appreciation against the U.S. dollar adjustment to NV instead. for an LOT adjustment which underpins affecting any date of sale during the POI. TKS maintains that the Department a CEP offset, the petitioner maintains should grant to it a CEP offset pursuant that no CEP offset is warranted. The Interested Party Comments to section 773(a)(7)(B) of the Act petitioner’s primary objection to MHI’s Common Issues in the German and because: (1) TKS’s home market sales contention that it is entitled to a CEP Japanese LNPP Investigations are all at a single level of trade which offset simply because the Department is identical to that of TKS’s unadjusted made CEP adjustments as required by We have included all issues which are CEP sales; (2) the adjustments made to the statute, rests on the observation that common to both this investigation and CEP place it at a different level of trade the Department appears to have flatly the concurrent investigation of LNPP than its home market sales; and (3) no rejected such a position in its proposed from Germany, and which were level of trade adjustment can be antidumping regulations: commented on by parties in both quantified. TKS claims that section It would not be appropriate to assume that proceedings, in the Final Determination 773(a)(7)(B) of the Act, which authorizes the CEP is at a different level of trade than of Sales at LTFV: LNPP from Germany, application of the CEP offset, applies to the prices used as the basis of normal value which is being published concurrently all of TKS’s CV-to-CEP sales or that any such differences in the level of with this notice. comparisons used in this investigation. trade affect price comparability. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38143

See Antidumping Duties; Countervailing cannot determine whether an LOT sales the level of trade will be evaluated Duties (Notice of Proposed Rulemaking adjustment is warranted, nor whether based on the price after adjustments are and Request for Public Comments), 61 the level of trade in the home market is made under section 772(d) of the Act. FR 7308, 7348 (February 27, 1996). in fact further removed than the level of As stated in Armid Fiber ‘‘the level of Although MHI has three different trade in the United States. We agree trade of the U.S. sales is determined by channels of distribution in the home with the petitioner that a respondent is the adjusted CEP rather than the starting market, the Department cannot ascertain required to affirmatively demonstrate all price.’’ which selling functions are performed the requirements which would entitle it Cost Issue by MHI and which are provided by to a CEP offset as a surrogate for an LOT trading companies or other entities for adjustment. The petitioner correctly Comment 2 Collection of Cost Data each type of home market sale. The noted that the Department’s in Absence of the Initiation of a Cost petitioner argues that the lack of a questionnaire requested from Investigation: MHI argues that the factual foundation for evaluating levels respondents all the relevant information Department’s collection of cost data on of trade means that a LOT adjustment required for an LOT analysis and for the all home market sales in the absence of under section 773(a)(7)(A) cannot be documentation and explanation of any the initiation of a cost investigation not made and, further, that a CEP offset claim for an LOT adjustment. We agree only violates the 1994 GATT under section 773(a)(7)(B) is not with the petitioner that this information Antidumping Agreement (‘‘the authorized. was not provided. We note MHI’s claim Agreement’’), but is inconsistent with The petitioner also takes issues with in its section A response that a ‘‘level of U.S. law and administrative practice. the respondents’ argument that an LOT trade adjustment is unnecessary,’’ MHI cites Article 2.2.2 of the Agreement adjustment is warranted because of the though at the time of the submission, and section 773(e)(2)(A) of the Act to activities that would be removed from MHI did not know that the Department’s support its contention that the the CEP starting price. The petitioner’s analysis would classify its U.S. sales as Department should not have solicited interpretation is that such a position CEP transactions. Without the contract price and cost data in order to runs counter to the preamble to the CEP possibility of making a proper level of compute SG&A expenses and profit. provision in the proposed regulations. trade analysis, the Department cannot MHI contends that there is no provision The petitioner further argues that, and should not grant a deduction from in either the Agreement or U.S. law should the Department follow the NV for home market indirect selling which provides that a foreign producer methodology of the Preliminary Results expenses. automatically shall be subject to a sales- of Administrative Review: Armid Fiber Further, we disagree with the below-cost investigation after CV is from the Netherlands, 61 FR 15766, respondents’ most basic representation determined to be the appropriate basis 15768 (April 9, 1996) (‘‘Armid Fiber’’), of their home market sales. Respondents for NV. Instead, MHI contends that both then it would still contest the notion now contend that there is one home the Agreement and U.S. law instruct the that for CEP sales the level of trade will market level of trade to which CEP is Department to conduct cost calculations be evaluated based on the price after being compared, but this claim is not on the basis of records kept by the adjustments are made under section well substantiated. The information we respondent, provided that such records 772(d) of the Act. According to the have on the record for sales in the home are in accordance with the generally petitioner, stripping away the actual market does not support this accepted accounting principles selling functions reflected in the CEP conclusion. For TKS, sales were not (‘‘GAAP’’) of the exporting country and price before comparison for level of made only to end-users, i.e., newspaper reasonably reflect the costs of trade purposes amounts to an artificial publishers, but, as discovered during production and sale of the product. MHI reconfiguration of the CEP level of trade. verification, were sometimes made to cites the Final Results of Administrative The petitioner argues that this has the middle-men, such as leasing companies, Review: Large Power Transformers from effect of creating the appearance of in the home market. For MHI, we knew Italy, 52 FR 46,806 (1987) (‘‘LPTs from different levels of trade when in the in general that the company made some Italy’’), Preliminary Results of commercial market the levels are the sales involving trading companies based Administrative Review: Large Power same. Thus, the argument is set forth on one paragraph of explanation in Transformers from France, 61 FR 15461, that if the Department adjusts the CEP MHI’s section D response. We were 15462 (April 8, 1996) (‘‘LPTs from for U.S. selling expenses and artificially informed during the ‘‘sales and France’’), and Preliminary Results of views the CEP sale as not including the distribution’’ portion of the verification Administrative Review and Partial selling functions represented by those that MHI had three distinct channels of Termination in Part: Mechanical expenses, then it will be positing a distribution in the home market: (1) Transfer Presses from Japan, 61 FR difference in level of trade that does not direct sales to end-users; (2) sales 15034, 15035 (April 4, 1996) (‘‘MTPs exist. According to the petitioner, if the through trading companies and (3) sales Preliminary Results (1996)’’), in Department were to allow a CEP offset, to trading companies. See May 14, 1996, contending that the Department has then the Department must deduct all of verification report at pp. 4–5. For resorted to CV as the basis for NV for the indirect selling expenses from the neither TKS nor MHI can we ascertain reasons similar to those enunciated in U.S. price. which selling functions are performed the preliminary determination of this DOC Position: We disagree with the by them and which are provided by investigation, without automatically respondents. In this instant leasing companies, trading companies subjecting respondents to cost investigation, the respondents failed to or other entities for each type of home investigations. In those investigations, provide the Department with the market sale. Thus, the minimal amount MHI maintains, the Department was necessary data for the Department to of information provided does not correct to request product-line profit consider an LOT adjustment. Without support the conclusions reached by and loss information for its calculations such data, a LOT adjustment under respondents. of SG&A expense and profit. MHI states section 773(a)(7)(A) cannot be made We note, however, that we also that it complied fully by submitting its and, further, that a CEP offset under disagree, in part, with the petitioner. In internal profit and loss statements for section 773(a)(7)(B) is not authorized. those cases where an LOT comparison LNPPs. Accordingly, MHI argues that Absent this information, the Department is warranted and possible, then for CEP SG&A and profit should be calculated 38144 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices from MHI’s internal profit and loss excluded from CV profit, either on a home market sales are not in the statements in the Department’s final mandatory or discretionary basis. ordinary course of trade. calculations. DOC Position: We disagree with MHI The petitioner asserts that MHI has The petitioner maintains that the that the Department violated the misread Federal Mogul in its arguments. Department’s request for home market Agreement and U.S. law in soliciting First, the petitioner maintains that contract price and cost data ‘‘in order to and collecting cost and sales data for Federal Mogul is of little relevance since compute SG&A and profit’’ for its CV each home market sale. There is nothing it was decided under the former statute calculations in accordance with section in the Agreement or the statute which and Congress has effectively revised this 773(e)(2)(A) of the Act was a reasonable precludes the Department from area of agency practice. The petitioner action within its discretion in light of requesting sales-specific cost and sales states that the SAA clearly provides the requirements of the 1994 WTO data for home market sales, regardless of that, in most investigations, profit will Antidumping Agreement (‘‘the whether a sales-below-cost investigation be calculated using only above-cost Agreement’’) and U.S. law. had been initiated. In addition, we sales. Second, the petitioner maintains According to the petitioner, the disagree with MHI that the collection of that even under the old law, Federal Agreement and the Act which project-specific home market sales and Mogul does not support MHI’s implements the Agreement require the cost data was an aberration from the proposition that the petitioner bears the Department to exclude below-cost sales Department’s normal practice. In this burden of presenting evidence that from the calculation of SG&A and profit. case, the petitioner provided a timely below-cost sales are outside of the The petitioner contests MHI’s statement allegation of sales below cost and our ordinary course of trade. According to that section 773(f)(1) of the Act forbids review of the respondents’ section A the petitioner, the court’s ruling actually the Department to examine transaction- questionnaire responses revealed that said that the reviewing court owed specific data for profit and SG&A transaction-specific cost information substantial deference to the agency and because it had a product-line financial was readily available and could be that, on appeal, the petitioner bore the statement. According to the petitioner, provided by the respondents. This being burden of showing that the agency this position is without merit because one of the first cases under the new law, abused its administrative discretion. nothing in the cited statutory provision we are still developing our practice for The petitioner states that the in the URAA restricts the Department computing profit and SG&A in proposition that the Department from requesting transaction-specific accordance with the new law. unlawfully excluded below-cost home Comment 3 If the Department Must market sales is untenable, because no data. Petitioner also notes that MHI was Formally Initiate a Cost Investigation in requirement for a formal initiation of a capable of providing the information in Order to Disregard Below-Cost Sales: below-cost sale investigation is found in a timely manner. MHI argues that the Department did not the new statute. Rather, the petitioner The petitioner also objects to MHI’s act in accordance with the law when it contends, the statute at section 773(b)(1) characterization of the collection of excluded sales below cost as being of the Act provides that the Department transaction-specific information on outside the ordinary course of trade need only have ‘‘reasonable grounds to SG&A and profit as an ‘‘aberrational’’ under sections 771(15) and 773(b)(1) of believe or suspect’’ that the home practice. According to the petitioner, at the Act. MHI contends that sales made market sales of the respondent have this early stage of implementation of the below cost can be disregarded but that, been made at prices below the cost of URAA, any such characterization is not as a prerequisite, the Department must production. credible, as the Department is entitled to have reasonable grounds to believe or DOC Position: We disagree with MHI. evolve its practice under the new suspect that below-cost sales have been While the Department will typically statute. Petitioner also points out that made. Thus, the Department must initiate a sales-below-cost investigation MHI failed to mention that in LPTs from formally initiate a cost investigation in before excluding home market sales as France, the preliminary notice makes order to disregard the below-cost sales, being outside the ordinary course of clear that substantial questions arose which it did not do in this instant trade for purposes of calculating profit regarding profit and SG&A on the eve of investigation. MHI states that it would and SG&A for CV, the unique the preliminary determination, and that, be consistent with the SAA and the circumstances in this case required that although the Department calculated proposed regulations to include below- we perform a below-cost analysis even profit based upon the LPT respondent’s cost sales in the calculation of SG&A though the Department elected not to parent company’s financial statements, and profit. MHI maintains that the facts formally initiate a sales-below-cost the Department noted for the final in this investigation are consistent with investigation. determination that it would consider the recognition by the SAA of those Early on in this investigation it was calculating the respondent’s profit based situations where unprofitable sales will argued by all parties that we should only on above-cost data if it had cost be included in the calculation of the base NV on CV due to the unique and data for home market sales. antidumping duty margin because, in customized nature of LNPPs. The Based on the record of this this investigation, the Department Department determined that the investigation, the petitioner maintains determined that it was unnecessary to particular market situation of these that it was clear from the response to initiate and conduct a sales-below-cost highly customized and unique products section A that companies could report inquiry. Also, MHI cites Federal-Mogul did not permit proper price-to-price transaction-specific data, and that Corporation v. United States, 20 CIT comparisons and, accordingly, we based evidence pointed to below-cost sales. ll, Slip.Op. 96–37 (February 13, NV on CV. The petitioner subsequently According to the petitioner, given the 1996)(‘‘Federal Mogul’’), to support its filed a timely and proper cost allegation recent changes in the law and claim that no home market sales should which alleged that ‘‘Japanese producers congressional intent to exclude below- be excluded, because the burden of have sold the foreign like product at less cost sales from CV profit in most cases, presenting evidence of below-cost sales than the cost of production in the home it was reasonable for the Department to rests on the petitioner, who failed to do market.’’ We elected not to formally seek transaction-specific data in this so in this case. Absent a formal address petitioner’s below-cost investigation in order to analyze investigation of sales-below-cost, MHI allegation because we knew that we whether below-cost sales should be argues, there is no showing that MHI’s were going to base NV on CV for all Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38145 respondents, and the respondents’’ exclusion of below-cost sales, even if model-specific basis in this case, the questionnaire responses confirmed that such sales were not formally Department should exercise its transaction-specific cost data was disregarded pursuant to section discretion and not disregard home readily available. Moreover, we did not 773(b)(1) of the Act. market sales for normal value. want to burden respondents with having Comment 4 Each Home Market Sale The petitioner maintains that even if to respond to the very detailed section of a LNPP, Addition, or Component the Department decides that the statute D questionnaire for home market sales Constitutes a Distinct Model for does not require exclusion of below-cost that a formal below-cost investigation Purposes of Performing the Cost Test: sales, it plainly permits the Department would require. Although, arguably, we MHI argues that even if the to do so. Assuming arguendo that the should have formally addressed the Department’s exclusion of home market Department did not investigate below sales-below-cost allegation, at the time sales below cost from its SG&A and cost sales pursuant to section 773(b)(1) of its filing, we did not foresee the profit calculations was permissible, it of the Act, the petitioner maintains that implications a formal initiation of a should not treat the home market sales it could nonetheless properly exercise sales-below-cost investigation would as distinct models for purposes of its discretion to exclude such sales from have on the CV profit and SG&A performing the cost test. Respondent its profit calculations under section calculations. refers to section 773(b)(1) of the Act that 771(15). In past cases, under the old law, with says the Department is required to Concerning the proper definition of a similar types of products (i.e., large exclude home market sales below cost if ‘‘model’’ in this investigation, the customized products that are (1) they are made in substantial petitioner agrees with the Department’s manufactured over an extended period quantities, (2) over an extended period finding that ‘‘each home market sale of of time) in which we automatically of time, and (3) at prices which do not an LNPP, addition, or component, based foreign market value (now NV) on permit recovery of costs in a reasonable constitutes a distinct model for CV, the Department relied on the period of time. MHI also cites section purposes of performing the cost test’’ statutory minimum of eight percent for 773(b)(2)(C) of the Act, which states that because of the unique nature of the profit. See, e.g., Preliminary Results of substantial quantities must represent 20 product under investigation. Administrative Review: LPTs from percent or more of the volume of sales. Accordingly, the petitioner supports the Japan, 57 FR 23,204 (June 2, 1992); and In undertaking its preliminary analysis, use of individual models to determine Final Determination of Sales at LTFV: MHI claims that the Department ignored which home market sales should be MTPs from Japan, 55 FR 335 (January 4, this statutory definition of substantial excluded from profit and SG&A 1990) (‘‘MTPs Final Determination quantities and automatically applied its calculations because they were sold at (1990)’’). We realized early in this case model-specific cost test. Moreover, less than the cost of production. The that in accordance with the new law, we according to MHI, the Department’s petitioner maintains that since the would have to compute actual profit normal model-specific cost test loses Department’s model-specific test was and SG&A as opposed to simply relying relevancy when NV is based on CV. not altered when the statute was on the statutory minimum of eight MHI refers to Policy Bulletin, No. 94.3, amended, the Department properly percent. Accordingly, we requested ‘‘Disregarding Sales Below Cost- applied its model-specific test in the sales and cost data for each sale in the Extended Period of Time’’ (March 25, preliminary determination. The home market which fell within the 1994) to explain that the rationale for petitioner disagrees with the purview of this investigation. this test is to ensure that NV is not respondents’’ contention that full cost Section 773(e)(2)(A) of the Act calculated for a particular pricing recovery on each sale is unreasonable in specifies that SG&A and profit for CV be comparison by reference to sales made a large capital goods industry. The computed using only those sales of the exclusively below cost. petitioner asserts that, in setting prices, foreign like product that were made in According to TKS, the Department’s LNPP producers typically perform cost the ordinary course of trade. We model-specific COP analysis and its estimates based on the full cost of analyzed the contract-specific price and consequential exclusion of below-cost production with an allowance for profit cost information we received from sales from normal value calculations are so as to cover their production costs on respondents. This information indicated not in accordance with subsection every sale. Thus, the petitioner that there were below-cost sales made in 773(b), the SAA, and the Department’s maintains, a model-specific analysis is the home market, in substantial own interpretation of the statute. TKS appropriate. quantities, and over an extended period argues that the methodology employed DOC Position: We disagree with the of time. Although we did not formally by the Department ‘‘practically read the respondent that the substantial initiate a cost investigation under ‘‘substantial quantities’’ and cost quantities test must be performed on a section 773(b) of the Act (despite the recovery requirements out of the law.’’ basis other than a model-specific basis. fact that a timely allegation had been Yet TKS also concedes that the inherent In past cases, the Department has made by the petitioner based on the physical diversity among LNPPs is such routinely performed the cost test on a respondent’s data), the unique cost that ‘‘it would be equally improper’’ if model-specific basis. See, e.g., Certain reporting aspects of this case were such the Department were to change the Cut-to-Length Carbon Plate from that, in effect, the Department definition of model to encompass all Sweden, 61 FR 15,772, 15,775 (April 9, conducted a cost investigation and our home market sales during the POI. TKS 1996) (Comment 5); Stainless Steel analysis revealed evidence that there maintains that, with a class of products Angle from Japan, 60 FR 16,608, 16,616 were home market sales of merchandise consisting of highly-valued, uniquely (1995) (Comment 12). As indicated in within the purview of this investigation customized machines, model-specific the SAA, at page 832, the Department which were below cost. Section 771(15) analysis is not possible. TKS argues that will continue to perform the cost test on provides that sales and transactions disregarding sales made at below-cost no wider than a model-specific basis. In considered outside of the ordinary prices is discretionary because the this case, each LNPP sale clearly course of trade include ‘‘among others’’ wording in section 773(b)(1) is that the represents its own unique, customized, below-cost sales disregarded under Department ‘‘may’’ disregard sales. TKS model of merchandise. section 773(b)(1). The Department concludes that because, in its view, the Comment 5 The Department Should interprets this provision to apply to the COP test cannot be conducted on a Calculate Profit on the Foreign Like 38146 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Product: MHI argues that the additions and components could not be like product or situations where all sales Department’s preliminary analysis used as the basis for NV due to the are found to be made at below-cost calculated SG&A and profit on both particular market situation, the prices. TKS argues that the applicability LNPP additions and systems in underlying analysis for that is, generally, for all situations where the contravention of section 773(e)(2)(A). determination compels a conclusion NVs resulting from the application of MHI notes that additions and systems that home market LNPPs are not a section 773(e)(2)(A) would be are not equal in commercial value. foreign like product within the meaning ‘‘irrational’’ and ‘‘unrepresentative.’’ Thus, MHI argues that if the Department of section 771(16) of the Act (19 U.S.C. TKS argues that because profits are a continues its present methodology then section 1677(16)). Accordingly, TKS significant element of price, it would be it should only calculate SG&A and maintains that section 773(e)(2)A) is not illogical for the Department to utilize, profit using home market sales of the applicable rule for CV profit for CV purposes, the profits of those systems which are MHI’s foreign like calculation. TKS cites the Department’s sales which it rejected for price product. November 9, 1995, CV decision comparison purposes. The petitioner objects to MHI’s memorandum to support its contention The petitioner believes that TKS’s hypothesis that LNPP systems are a that the Department determined that position is wrong because the separate like product from LNPP each LNPP sold by TKS in the United Department has clearly defined the additions. According to the petitioner, States and in Japan is unique and that foreign like product to be LNPP systems, the Department has determined that a the models sold in the two markets are additions and components. The single like product exists which consists not approximately equal in commercial petitioner states that the fact that price- of all LNPP systems, press additions, value. Finally, TKS holds that the to-price comparisons could not be made and press components, regardless of Department determined that the LNPPs does not mean that home market sales state of completion. The petitioner sold in the United States and in Japan are outside the ordinary course of trade. argues that the Department made home are not ‘‘reasonably comparable’’ to each The petitioner supports the market viability and other other. Department’s analysis that matching determinations required by the statute TKS also argues that the correct rule sales would require cost adjustments based on this definition, and that for CV profit calculation in this case is tantamount to computing a CV for each changing the like product definition found in section 773(e)(2)(B) of the sale. The petitioner maintains that without cause at this late stage of an statute, because the Department found TKS’s arguments are inconsistent with investigation would involve that the particular market situation the precedents in MTPs Preliminary reassessment of numerous issues which precluded price-to-price comparisons. Results (1996) and LPTs from France (60 form the foundation of the Department’s According to TKS, the SAA requires FR 62808, December 7, 1995), wherein proceeding. Thus, the petitioner that the Department utilize section the Department rejected price-to-price maintains, MHI’s suggestion must fail as 773(e)(2)(B) in those instances where comparisons and instead used CV. an argument unsupported by either the the method described in section According to the petitioner, in those record or administrative precedent. 773(e)(2)(A) cannot be used, either cases the Department continued to use DOC Position: We disagree with MHI because there are no home market sale the home market profit data even that computing a single profit for both of the foreign like product or because all though it could not perform price-to- additions and systems is in such sales are at below-cost prices. price assessments, thereby negating the contravention of section 773(e)(2)(A) of TKS also argues that if, assuming idea that the lack of price-to-price the statute, which merely states that CV arguendo, TKS’s home market LNPP comparisons indicate that domestic shall include, inter alia, ‘‘actual sales constitute a foreign like product, sales are outside of the ordinary course amounts’’ for profits ‘‘in connection section 773(e)(2)(B) is still the of trade. with the production and sale of a applicable rule for CV profit calculation DOC Position: We disagree with TKS foreign like product. * * * ’’ The SAA in this case because TKS’s LNPPs are that there were no sales of the foreign makes no mention that the profit not sold in the ordinary course of trade. like product in the home market during calculation should consist of different According to TKS, the fact that the POI. TKS is incorrect to suppose rates for different pools of products technical specifications are vastly that because we did not find home within the foreign like product. From different within the respective groups of market sales which provided practicable early in the investigation we have components, additions and systems, price-to-price matches, no foreign like determined that a single like product LNPPs are, prima facie, merchandise product existed. The foreign like exists, and accordingly have computed produced according to unusual product product as defined by section 771(16) of profit based on all sales of the foreign specifications, which should be the Act, (i.e., sales of LNPP in Japan) did like product occurring in the ordinary excluded from analysis according to exist, as revealed by our examination of course of trade. section 771(15) of the Act. LNPP equipment sold in the home Comment 6 Home Market LNPP TKS offers a second subsidiary market for purposes of the Department’s Sales Do Not Constitute a Foreign Like argument, that if, further assuming home market viability test (pursuant to Product: TKS maintains that the arguendo, its home market LNPP sales section 773(a)(1)(C) of the Act) as stated Department should base its CV profit both constitute a foreign like product in our November 9, 1995, decision calculation on either TKS’s average and are sold in the ordinary course of memorandum regarding the LNPP profit or on the company’s trade, section 773(e)(2)(B) still controls determination of the appropriate basis financial statement. TKS first argues CV profit calculations where, as here, for NV. However, the degree of unique that section 773(e)(2)(A) of the Act is the Department has determined that the customization for customers made the not applicable to the CV profit ‘‘particular market situation’’ affecting difference-in-merchandise adjustment calculation because the Department home market sales does not render for product price matching potentially determined that TKS’s home market price-to-price comparisons feasible. TKS so complex that the use of CV provided LNPPs do not constitute a foreign like maintains that the SAA language does a more reliable and administrable product. According to TKS, because the not limit the applicability of section methodology for establishing NV. As Department determined that TKS’s 773(e)(2)(B) to situations where there stated in our November 9, 1995, Japanese sales of LNPP systems, are no home market sales of the foreign decision memorandum, the Department Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38147 declined comparison of products within the express exclusion of those home various conditions of weather, have a the same class of products which have market sales below the cost of short shelf-life, and are often sold on a such prominent physical dissimilarities production. consignment basis. Thus, the as to make comparisons and DOC Position: We disagree with TKS. Department has considered such calculations of adjustments for such The circumstances in the instant products subject to forces beyond the physical differences impracticable, investigation do not call for the producer’s control which may cause pursuant to the ‘‘particular market Department to exercise its discretionary occasional sales below cost. By situation’’ provision, section authority to include sales made below comparison, LNPPs are precisely the 773(a)(1)(C)(iii) of the Act. cost, which were determined to be in appropriate case for the Department to Because we have not determined the substantial quantities, over an extended exercise its discretion to disregard the absence of the foreign like product in period of time, and prices which do not below-cost sales in the context of job- Japan, we disagree with TKS’s permit recovery of costs in a reasonable order cost accounting, for in the context suggestion that section 773(e)(2)(B) period of time. We agree with the of this industry, the foreign like product should apply in determining CV profit. petitioner’s earlier comment that, that is as removed as possible from the The correct statutory provision for CV even if the statute does not require forces affecting perishable products. profit calculations in this instance is exclusion of below-cost sales, it plainly Comment 8 Circumstance of Sale section 773(e)(2)(A) and, accordingly, permits the Department to do so. If a adjustment for Credit Expenses: The the Department’s final margin company’s market strategy results in petitioner argues that the Department calculations were formulated under its below-cost sales of LNPPs, then a should not have deducted credit guidelinesse. willingness to sell below cost is not expenses from MHI’s and TKS’s CV Comment 7 The Department Has negated by the relative infrequency of because CV did not include credit Discretion Not to Disregard Below-Cost transactions for unique, customized expenses in its original composition. Sales: TKS maintains that the legislative products. First, the Department does not According to its analysis of the history of the 1974 Trade Act, as analyze the intent, per se, of the preliminary determination calculations, reemphasized in the URAA with respect respondent in dumping its products, the Department inappropriately failed to to section 773(b), shows the whether above, at or below cost. include home market credit expenses Congressional intent that certain types Second, even if intent were a factor, we when calculating CV. Citing Final of below-cost sales should not be believe TKS’s arguments regarding job- Determination of Sales at LTFV: Certain disregarded for foreign market value order costing are incorrect. The Granite Products from Italy, 53 FR (now NV) determinations. According to procedure of developing each project 27187, 27191 (July 19, 1988), Final TKS, this legislative history reveals the during the sales negotiating and pricing Determination of Sales at LTFV: PET intent of Congress that the Department process gives LNPP manufacturers every Film, Sheet and Strip from the Republic exercise discretion under section 773(b) opportunity to recognize that they are of Korea, 56 FR 16305, 16307 (April 22, based upon the ‘‘rationality of exporters concluding transactions that will be 1991); Final Results of Administrative pricing practices.’’ TKS lists three below the cost of production. Also, Review: Roller Chain, Other than reasons why the Department should TKS’s claim that it recovers its losses Bicycle, from Japan, 55 FR 42602, 42606 consider the characteristics of the LNPP from a particular sale over time shows (October 22, 1990); and Preliminary market and the rationality of the pricing that it is necessary to analyze each sale Results of Administrative Review: practices of market participants such as its own model. If costs cannot be Certain Fresh Cut Flowers from that it should exercise its discretion not recovered for each sale, which takes Colombia, 60 FR 30270, 30274 (June 8, to disregard sales made below cost. several years to conclude in delivery 1995), the petitioner argues the First, TKS claims that below-cost sales and installation, then that sale should Department’s standard practice requires of LNPPs are not systematic, since they be excluded. If TKS is willing to sell the addition of imputed credit to CV. are infrequent transactions for unique, below cost for a particular sale, hoping The petitioner maintains that in the customized products. Second, TKS to recover costs through other projects, instant investigation, when the claims that below-cost sales of LNPPs whether subsequent sales of press Department made a circumstance of sale occur for reasons beyond the producer’s additions and/or through servicing adjustment by subtracting home market control. Third, TKS maintains that even contracts, then it has, in effect, credit expenses from CV, it removed an though the producer may sustain losses purposely used a transaction as a loss- expense from a price that did not in isolated sales, the producer usually leader, to the point of selling below cost. include that expense in the first place. recovers the losses over a period of three If we examine past circumstances MHI argues that the Department to four years. TKS claims that this is an where the Department has exercised its properly excluded home market credit appropriate case for the Department to discretionary powers, and investigated expenses in its CV calculations. MHI exercise its discretion by not the issue, not in terms of intent, but in further argues that the Department has disregarding below-cost sales, as this terms of unique market conditions for recently changed its practice as found in instant case is the first antidumping particular products, we must still Final Determination of Sales at LTFV: investigation in which the Department conclude that TKS has no basis to claim Certain Pasta from Italy, 61FR 30326, at considers the application of section that below-cost sales of LNPPs occur for Comment 14 (June 14, 1996) (‘‘Pasta’’). 773(e)(2)(A) in the context of job-order reasons beyond the producer’s control. MHI explains that the Department cost accounting. An example of sales where the justified its change in practice by citing With respect to the enforcement of the Department has historically exercised sections 773(b)(3)(B) and 773(e)(2)(A) of statute, the petitioner’s approach is its discretion not to exclude certain the Act, which direct the Department to diametrically opposed to that of TKS. sales below cost occurs in the case of calculate SG&A, including interest The petitioner maintains that, even if perishable agricultural products. See, expense, based upon actual experience the Department decides that the statute e.g., Final Results of Administrative of the company. MHI contends that does not require exclusion of below-cost Review: Certain Fresh-Cut Flowers from because the Act defines the calculation sales, it plainly permits the Department Mexico, 56 FR 1794 (January 17, 1991). of general expenses for COP and CV in to do so. The petitioner therefore urges Flowers, fruits and vegetables are raised the same way, the Department stated the Department to use that discretion for and sold en-masse, are subject to that it would be inappropriate to 38148 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices calculate interest expense differently for maintenance/technical work, which are allocations’’ which management often COP and CV. Furthermore, MHI each conducted by a separate division makes in allocating G&A using bases contends that because the Department with specific personnel assigned to each other than CGS. computes profit as the ratio of profit division. B. MHI’s Indirect Selling and G&A earned on home market sales to the cost TKS maintains that the Department’s Expense Allocation of production, applying the ratio to a allocation of SG&A expenses ignores the COP inclusive of imputed credit would diversity of activities at TKS USA and MHI argues that the common G&A be mathematically incorrect. assigns an inordinate share of the portion of MLP’s indirect selling TKS maintains that the petitioner’s expenses to press sales. Although TKS expenses should be allocated to LNPPs arguments are moot because they rely admits that a CGS-based allocation is based on the number of employees solely on the Department’s practice common Department practice, it claims involved in LNPP operations. MHI prior to the 1994 amendments to the that such practice is not mandated by states that allocating common G&A by Act. TKS argues that the petitioner’s either the Act or the Department’s LNPP sales value does not accurately position would only have validity if regulations. TKS maintains that for the reflect the common G&A expenses applied to cases investigated under the final determination, the Department incurred for LNPP sales activity. old law. According to TKS, the should exercise its discretion and utilize According to MHI, a headcount Department’’ treatment of imputed TKS’s proposed headcount methodology methodology of allocation reflects the credit is correctly based on the current to allocate administrative expenses. greater importance and number of section 773(e) of the Act, which requires TKS maintains that the Department resources required to support its that the ‘‘actual general expenses’’ be should give consideration to the fact commercial press sales at MLP. MHI added to CV. Since the current Act now that the headcount methodology is explains that MLP’s staff must spend provides that general expenses added to utilized internally by TKS USA in the more time attending to issues related to CV be limited to actual expenses, TKS normal course of business. Thus, TKS commercial press sales activities than a maintains that imputed credit cannot be argues, to the extent that TKS USA has sales-based allocation would reflect utilized, as it is not an actual expense, any historical practice employed (e.g., personnel in MLP’s accounting but a measure of opportunity cost. TKS previous to the investigation, it involves and purchasing sections spend cites to the basic rationale for the the headcount methodology. significantly more time issuing invoices, calculation of CV outlined in Pasta, to Finally, TKS cites to the Department’s monitoring sales accounts receivable, support its contention that only actual Final Results of Antidumping Duty purchasing parts, and recording expenses will be applied to CV. Administrative Review: DRAMS of One expenses related to commercial press DOC Position: We agree with Megabit or Above from the Republic of operations than they do to LNPP respondents. Section 773(e)(2)(A) of the Korea (61 FR 20216, 20217, May 6, operations). MLP explains that it Act requires that the Department 1996), to support its contention that, provides financing services solely for include in CV the actual amount of just as the Department affirms that commercial press sales. MHI claims that SG&A expenses (including net interest indirect selling expense allocations are while a headcount methodology would expense) incurred by the exporter or not inflexibly limited to a value-based still allocate too much common expense producer. Imputed credit is, by its methodology, the Department should to LNPPs, such an allocation would nature, not an actual expense. also recognize that G&A expenses nonetheless be more accurate than Therefore, we did not include imputed should not be limited to a value-based allocation by sales value. MHI states credit in the CV calculation for the final approach. that its existing base of commercial determination. The petitioner argues that TKS’s claim press customers is vastly larger than the Comment 9: Headcount Methodology that it allocates G&A expenses based on LNPP base and that the Department’s vs. CGS Methodology: TKS and MHI headcount in the ordinary course of methodology fails to capture the offer similar arguments concerning the business to each of its separate divisions inherent slant of general expenses proper methodology for allocation of appears to contradict its submissions. toward the servicing and maintenance general and administrative expenses. The petitioner cites to TKS’s section A of MLP’s existing commercial press Below, Part A summarizes the response, where it stated that TKS USA sales. MHI states that a sales-based arguments concerning TKS USA’s ‘‘does not maintain any internal allocation is a reasonable measure of operations and Part B the arguments financial statements of profit and loss cost when the only activity is selling. concerning MLP’s operations. statements for specific product lines, or MHI also argues that the Department specific internal business units.’’ The should consider that headcount A. Allocation of TKS USA’s Office petitioner also notes that TKS seems methods are employed by MHI in the Administration Expenses inconsistent in concluding that normal course of business, as would be TKS objects to the allocation of TKS allocating TKS USA’s G&A costs based expected, since sales-based allocations USA’s office administration expenses on on CGS is distortive in light of its of indirect expenses are uncommon in the basis of total CGS. TKS states that position in favor of a value-based normal commercial systems. these expenses should be allocated on allocation of product-specific factory The petitioner argues that the the basis of headcount, which impacts overhead and engineering costs. Finally, Department’s long-standing policy is to the calculation of both further the petitioner juxtaposes TKS’s allocate U.S. indirect selling expenses manufacturing costs and reported reasoning with that of MRD, a on the basis of sales value, citing Final selling expenses. TKS maintains that respondent in the companion German Determination of Sales at LTFV: Certain this is required because TKS USA’s LNPP investigation, who re-allocated Internal-Combustion, Industrial Forklift commercial activities include G&A expenses on a value basis while Trucks From Japan, 53 FR 12552, 12577 merchandise other than LNPP, namely citing to the Department’s Final (April 15, 1988) and the Department’s (1) Sale of spare parts; (2) the conduct Determination: Certain Carbon and questionnaire. The petitioner notes that of press audits; (3) the sale and Alloy Steel Wire Rod from Canada, 59 the Department rejected the headcount production of control systems; (4) the FR 18791, 18795 (April 20, 1994) allocation method at the preliminary sale and production of digital ink (‘‘Carbon and Alloy Steel Wire Rod)’’, determination and applied the standard pumps; and (5) independent MRD recognized the ‘‘subjective allocation methodology. The petitioner Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38149 argues that MHI’s use of headcount to section in the companion German distort the results for two reasons: (1) allocate these expenses was created for notice, the petitioner maintains that the The U.S. subsidiary is involved in purposes of this investigation and Department failed to deduct many of further manufacturing for some sales, so asserts that the Department has rejected TKS’s U.S. indirect selling expenses that there can be a significant difference such subjective management allocations because they were recorded in the between transfer price and sales price; of U.S. affiliate G&A expenses in prior accounts of the foreign LNPP and (2) theoretically, the Department’s cases, even where such methods were manufacturer. According to the proposed calculation method should not used in the normal course of business petitioner, the Department should result in significant differences in the (citing the German companion case to deduct all indirect selling expenses final calculated per-unit amount of U.S. this investigation). The petitioner takes incurred on behalf of U.S. sales, selling expenses. issue with MHI’s suggestion that irrespective of the location at which the DOC Position: We disagree with indirect selling expenses are incurred expenses are actually incurred or the respondent’s arguments. Since TKS only as a function of the number of location of the company in whose books calculated a universal indirect selling employees directly involved in sales the expenses are recorded. expense factor, including therein all and servicing and states that this As noted in the General Comments expenses incurred in Japan associated assertion ignores the fact that companies Section, above, TKS maintains that the with U.S. sales (and even included trade expend more common effort (e.g., senior Department has adopted a new show expenses which were physically management time, travel expenses, and methodology for calculating indirect incurred in the U.S.), such expenses entertainment) to win large-value sales. selling expenses pursuant to the should be deducted from CEP, in DOC Position: The Department enactment of the URAA which make keeping with the Department’s disagrees with TKS’s contention that petitioner’s arguments moot. TKS also definition of U.S. indirect selling TKS USA’s office administration makes the following arguments specific expenses in Final Determination of expenses should be allocated to its to its questionnaire response. Sales at LTFV: Certain Pasta from Italy, LNPP operations based on relative TKS disagrees with the assertion that 61 FR 303256 (June 14, 1996). headcounts. it was unwilling to accurately segregate With respect to the numerator of Similarly, the Department disagrees expenses related to Japanese versus U.S. TKS’s reported indirect selling expense with MHI’s contention that MLP’s economic activity. TKS maintains that factor, TKS must report all home market common G&A expenses should be the record of the investigation expenses since it is including all home allocated to its LNPP and commercial demonstrates that it properly reported market sales in its denominator. TKS’s press operations based on relative expenses and that there is no indication argument in its submissions that the headcount. of unwillingness to comply with branch offices have nothing to do with As set forth in Carbon and Alloy Steel Department instruction to separately export sales is besides the point—the Wire Rod, our normal methodology for report expenses; TKS cites to the sales revenues included in the allocating G&A expenses to different verification report to bolster its denominator have nothing to do with operations is based on CGS. Our conclusion that the reported indirect export sales either. The fact is that TKS methodology recognizes the fact that the expenses incurred in Japan on behalf of has calculated a universal indirect G&A expense category consists of a sales, including exports, do not contain selling expense factor for all sales in all wide range of different types of costs U.S. economic activity. markets, not a factor pertaining Lastly, TKS argues that if the which are so unrelated or indirectly exclusively to TKS USA sales, not even Department does deduct from CEP related to the immediate production exclusively to export sales. indirect selling expenses incurred in With respect to the denominator, TKS process that any allocation based on a Japan on behalf of U.S. sales, then the is mixing apples and oranges in its single factor (e.g., headcount) is purely amount reported by TKS is the correct calculations. The portion of its speculative. The Department’s normal amount. TKS argues that its denominator for home market and third- method for allocating G&A costs based methodology, whereby it divided total country revenue represents gross sales on CGS takes into account all indirect selling expenses incurred in values; it is only the U.S. sales value production factors (i.e., materials, labor, Japan by the company headquarters, which represents TKS Ltd.’s sales to a and overhead) rather than a single exclusive of branch office expenses, by subsidiary. As TKS reported, and the arbitrarily chosen factor. Absent the total transfer price value of all sales, Department verified, TKS Ltd. sold evidence that our normal G&A is methodologically sound. It maintains direct to end-users and, on occasion, allocation method unreasonably states that the expenses reported are in direct to unaffiliated middlemen such as G&A costs, we continued to allocate support of TKS USA and related to leasing companies in the home market. such costs for the final determination intra-company communications. In fact, it is this absence of a Japanese based on CGS. Furthermore, TKS argues that since it is sales subsidiary which is part of TKS’s Further, because we have treated the the sales price between TKS Ltd. and arguments for a CEP offset based on a common G&A expenses in question as TKS USA which is reported in the claimed single level of trade in Japan part of total G&A rather than as part of company’s financial statements, TKS different from that in the United States. our calculation of total indirect selling should allocate total selling expenses The indirect selling expenses which are expenses, the allocation methodology incurred by the Tokyo office over the incurred for all sales should be allocated issue for the common G&A expenses total sales as shown in the financial over the sales value of all sales, not over impacts the calculation of the G&A rate statements. TKS maintains that if the a mix of domestic sales value, third- and has no effect on the indirect selling DOC does deduct indirect selling country sales value and U.S. transfer expense calculations. expenses associated with U.S. sales but prices. TKS-Specific Comments incurred in Japan, then it should apply It is because TKS’s original this ratio to the transfer price of each calculations are such a hybrid that the Sales Issues U.S. sale. TKS maintains that deriving a correction to total revenue in the Comment 1 Deduction of U.S. factor based on total sales revenue and denominator slightly decreases the Indirect Selling Expenses from CEP: As then applying that ratio to each indirect selling expense ratio, whereas noted in detail in the Common Issues transaction’s gross sales value would the proper application to gross sales 38150 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices value increase what TKS called the even if the Department rejects the preferential treatment for specific ‘‘per-unit’’ amount. TKS, arithmetically general argument that all indirect selling clients,’’ to support the contention that, speaking, was slightly overstating the expenses supporting U.S. sales, legally, Yasuda must set premiums at size of the expense factor, but in including those incurred as well as arm’s-length levels. applying that factor to non-arm’s-length recorded in Japan, be deducted from With respect to the petitioner’s transfer prices, was significantly CEP, the Department should at a request that the Department increase understating the per-press sales minimum deduct the Japan indirect reported insurance costs based on a expenses. Even if all of the denominator selling expenses reported by TKS comparison of Yasuda’s preferred were comprised of transfer price values, because of the inclusion of definite premium/loss ratio to that arising out of it would not necessarily be allowable as elements of U.S. economic activity. its actual experience with TKS, the an allocation basis. TKS points out that DOC Position: We agree in general respondent offers several challenges. the transfer-prices and sales prices differ with petitioner’s argument. We have First, TKS maintains that Yasuda has greatly, which only underscores why revised our general treatment of indirect only identified a ‘‘preferred’’ ratio for the Department is reluctant to utilize in selling expenses incurred on behalf of return on its business efforts, and that margin calculations prices that, by U.S. sales and recorded by the parent there is no evidence on the record that definition, were not set at arm’s length. company in this final determination. As the ratio is anything other than that. There may be specific, compelling detailed in Common Issues comment 1, According to TKS, absent any circumstances whereby the Department the Department is deducting from CEP information showing how often this exercises its discretion to rely on indirect selling expenses associated ratio is actually achieved in actual transfer prices to a limited degree. For with U.S. economic activity. We thus business practice, the petitioner cannot example, for MAN Roland capture the expenses which pertain to draw conclusions about what occurs Druckmaschinen AG, a respondent in economic activity in the United States among unaffiliated customers of the companion investigation of LNPPs which had not been deducted from CEP Yasuda. Second, TKS argues that the from Germany, the Department applied in the preliminary determination. ratio is only a snapshot in time, the indirect selling expense factor to the Comment 3 Purchase of Insurance immediately after a major loss and transfer price for certain sales which from an Affiliate: Petitioner posits that before the next premium renewal consisted only of parts and the information collected at verification period. Third, TKS argues that subcomponents which had no separate supports its conclusion that the petitioner’s allegation that the loss contract value. See Comment 1 of the insurance relationship between TKS premium ratio excludes the Spokane ‘‘Common Issues’’ section of the Federal and Yasuda Fire and Marine Insurance Spokesman Review loss is not Register notice for LNPPs from Ltd. (‘‘Yasuda)’’, is not at arm’s length. supported by evidence, as Yasuda’s Germany. Petitioner points to the fact that the letter clearly states that the reported We have recalculated the universal loss/premium ratio for covering TKS loss/premium ratio covers TKS’s indirect selling expense accordingly and Ltd., even before the Spokane exported cargos for the period from applied it to the gross sales value of U.S. Spokesman Review accidents, had been April 1990 through January 1996. TKS sales. significantly higher than the ratio which states that petitioner has not provided Comment 2 Reporting of All Selling Yasuda normally establishes in creating evidence that the loss amounts factored Expenses Related to U.S. Economic a policy. These accidents, petitioner in the loss/premium ratio are based on Activity: Petitioner maintains that the states, increased the loss premium ratio claims rather than on insurance-adjuster Department discovered during its Japan even more. Accordingly, the petitioner estimated loss amounts. verification that TKS incurred selling advocates that the Department increase Lastly, TKS maintains that, although expenses related to U.S. economic TKS’s reported insurance costs by the it believes that the issue of the extent to activity, but failed to include the factor resulting from the division of the which TKS’s insurance actually covered expenses in its reported U.S. indirect actual loss/premium ratio by the the costs resulting from transit accidents selling expenses. The petitioner points expected loss/premium ratio. The is moot by virtue of the extraordinary to the verification report stating that petitioner also asks the Department to nature of the costs, it must point out TKS splits the annual U.S. trade show re-examine whether any costs related to that petitioner is factually incorrect in expenses between TKS USA and TKS trucking accidents in the U.S. not arguing that the actual insurance Ltd. Japan. Because the trade show is covered by insurance should be settlement received in March 1996 did economic activity occurring in the considered as part of the constructed not fully cover the costs incurred in United States, the petitioners argue that value of the Spokane Spokesman producing and transporting the TKS should have reported the entire Review sale. replacement equipment. trade show expense as a U.S. selling TKS rejects the petitioner’s argument DOC Position: We agree with the expense rather than including a that the Yasuda premiums are not at petitioner, in part. We agree that TKS substantial portion of the expenses as arm’s length and offers the following in was unable to provide sufficient part of general indirect selling expenses support of its position. According to evidence that the Yasuda insurance incurred in Japan. Further, the TKS, it requested Yasuda to provide expenses reported were at arm’s length. petitioner states that the practice of documentation with which the We disagree with petitioner regarding charging back expenses for U.S. Department could compare TKS the relationship between insurance economic activity occurred for premiums to those paid by unaffiliated coverage and the treatment of any numerous other expenses, including insurance customers but that Yasuda extraordinary expenses incurred due to testing and training costs. The petitioner refused. Since the interest ownership is in-transit accidents for the Spokane points out that since the indirect selling by Yasuda in TKS, and not vice versa, Spokesman Review sale; whether or not expenses of TKS Ltd. Japan were not TKS explains that it had no means of such expenses were covered by Yasuda subtracted from the U.S. price in the compelling Yasuda to provide the is not germane. preliminary determination, TKS’s information. TKS cites Article 16 of the We disagree with TKS’s contention charge-back procedures had the effect of Japanese law concerning the Regulation that the existence of article 16 of overstating the U.S. price in the margin of Insurance offerings which ‘‘* ** Japanese law automatically means that calculations. The petitioner argues that, generally prohibits extension of Yasuda has complied with it. The only Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38151 benchmark which TKS and Yasuda maintains that it offered a greatly information or argument since the provided was Yasuda’s statement of its reduced price for this unit due to its preliminary determination which would expected loss/premium ratio, which was belief that the machine had significantly change the Department’s conclusion. significantly less than that which lost its value from the repeated The petitioner maintains that TKS is Yasuda experienced with TKS. This cannibalization of parts and frequent incorrect in characterizing the DMN sale benchmark shows that the historical trade show presentations. in question as being the only sale experience of Yasuda with TKS in terms TKS argues that the Department involving a press which was displayed of the relationship between the losses should exercise its discretion to exclude at a trade show, as a later DMN sale also claimed by, and premiums paid by, sales from the dumping analysis if the involved a press shown at such an TKS, has been significantly different sales are not representative of the event. The petitioner also maintains that from the loss/premium guidelines foreign producer’s selling practices in TKS routinely uses parts from inventory Yasuda claims to adhere to in its normal the U.S. market. TKS cites the Final in the construction of presses, so that business practices. We also disagree Results of Administrative Review: Fresh the fact that TKS used inventoried parts with TKS that the policy ratio in Cut Roses from Columbia, (60 FR 6980, for this sale is not indicative of its Yasuda’s letter reflects the claims paid 7004, February 6, 1995) (‘‘Roses from alleged ‘‘special’’ nature. The petitioner on the Spokane accidents; our Colombia’’) to support its contention characterizes this sale as a loss leader examination of the values involved that the Department can and has sale, stating that this DMN sale ‘‘was at show this to be arithmetically excluded U.S. sales when they ‘‘are a very low price because TKS knew that unsupportable, as detailed in the TKS clearly atypical and not part of the the DMN would soon be in the market July 15, 1996, calculation memorandum. respondent’s ordinary business for more press additions.’’ Nevertheless, we have not increased practices, e.g., sample sales.’’ TKS then DOC Position: We disagree with TKS. that ratio to include the petitioner’s cites to IPSCO, Inc. et al. v. United While the Department has the discretion adjustment which imputes an additional States, 687 F. Supp. 633,642 (CIT 1988) to exclude some types of U.S. sales claim amount for the Spokane where the court asked the Department to when made in insignificant quantities, accidents, as the potential effect of those clarify the circumstances under which it we do not believe that it would be accidents may (and to the degree there would consider exclusion of U.S. sales. appropriate to exclude this particular is any even partial objective nature to According to TKS, on remand, the sale. In cases such as Roses from the Yasuda-TKS relationship should) Department stated that it could exclude Colombia we excluded sample sales and increase future premiums. Since the certain U.S. sales from the margin in the Final Determination of Sales at expenses we are using in our analysis where such sales (1) are not LTFV: Coated Groundwood Paper from calculations are those for the historical representative of the seller’s behavior, Finland, 56 FR 56363 (November 4, premiums paid during the POI, the ratio and (2) are so small that they would 1991), (‘‘Groundwood Paper’’) we we used is based on loss/premium ratio have an insignificant effect on the excluded U.S. trial sales and sales of for the period covering TKS sales as margin. TKS maintains the DMN sale in damaged merchandise, where such sales noted in the documentation reviewed at question is unlike any of the other sales were made in small quantities. In those verification. We have therefore reported, as no other product was cases, the transactions involved stood increased TKS’s reported insurance produced from trade show models over by themselves; that is, they were of costs by the factor resulting from the an eight-year period of intermittent commodity products which were not production processes and multiple directly related to other sales. For division of the actual loss/premium episodes of intercontinental example, in the case of Groundwood ratio by the expected loss/premium ratio transportation. TKS buttresses its Paper, a printer would never be bound as shown in the Yasuda documentation. argument based on the percentage, by to a paper supplier just because it tried With respect to question of how the value, of total U.S. sales which this a free roll of normal quality paper, nor insurance coverage of expenses incurred particular DMN sale represents (which would a producer gain any leverage due to accidents which befell the number is proprietary). TKS states that because it found a buyer with a unique trucking of LNPP components for the this value is so small that exclusion of application for damaged rolls of paper. Spokane Spokesman Review sale should the sale from the dumping margin Sales of LNPP, however, are of or should not affect the final production analysis would not impede the expensive, customized capital expenses, see TKS Comment 8. Department’s calculations. TKS cites to equipment which actually change the Comment 4 TKS’s Request for American Permac, Inc. v. United States, nature of the printer’s operations. In this Exclusion of a Dallas Morning News 783 F. Supp. 1421 1424 (1992) wherein specific case, in light of the duration of Sale: TKS argues that the Department the CIT stated that ‘‘whether sales are in relations between TKS and the DMN, should exclude one of the sales made to or out of the ordinary course of trade is one can reasonably interpret this sale as the Dallas Morning News (‘‘DMN)’’ from not the determinative factor on the U.S. part of an over-arching marketing its margin calculations. TKS argues that, sales side of the equation. Fairness, strategy vis-a-vis a long-term business while the Department is correct to state distortion, representativeness are the relationship with the DMN, i.e., as a loss that the statutory reference to the issues to be examined.’’ Finally, TKS leader sale. exclusions of sales outside the ordinary disagrees with the Department’s In this investigation we are reviewing course of trade from the dumping preliminary conclusion that the pricing a very small number of large-value margin calculation does not, per se, of this DMN sale represented a contracts whose fulfilment as pertain to U.S. sales, the Department concessionary price set as an transactions spans several years. The may exercise its discretion to do so if inducement for other sales to the same Department’s discretion to exclude sales the exclusion of a particular U.S. sale customer, since TKS had one sale to the must take into account the fact that would prevent ‘‘unfair results.’’ TKS DMN prior to the transaction in there is such a small pool of sales which then reviews the history of the question. are available for analysis. Because the manufacturing of the sale in question, The petitioner maintains that the Department is not convinced that the which was comprised of parts sourced Department fully reviewed this issue at DMN sale in question was so unusual from model LNPP units exhibited in the preliminary determination and that that it should be disregarded, we are 1989, 1990, 1991 and 1993. TKS TKS has presented no new factual including this sale in our final analysis, 38152 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices and are using the actual costs which the routine post-delivery technical the Spokesman Review sale. According were reported in the CV exhibits of service required by high-priced, highly- to TKS, the daily rate fluctuated from TKS’s January 18, 1996, supplemental engineered machinery. the benchmark rate by more than 2.25 submission, inclusive of any The petitioner maintains that TKS’s percent, so that, in accordance with modifications arising from verification. argument is incorrect because the issue section 773A(a) of the Act, the The parts which were sourced from of when title transfers is not relevant to benchmark rate should be used for this units existing in TKS’s inventory were the expense classification issue. transaction. not used parts and should be included According to the petitioner, all those DOC Position: We agree with TKS. At in those actual costs. expenses which are correctly treated as the preliminary determination, the Comment 5 U.S. Direct Expenses for further manufacturing—installation Department inadvertently utilized the the Dow Jones Sale: TKS maintains that supervision as well as testing and daily exchange rate for the Spokesman the terms of sale for the Dow Jones sale training, occur after title is transferred. Review sale, whereas, due to the degree were such that the customer, and not The petitioner also maintains that since of fluctuation experienced on that day, TKS, was responsible for transporting TKS classified the Dow Jones sale as a the benchmark rate is the correct the merchandise from the U.S. port to further-manufactured transaction, all of exchange rate. We have utilized the the customer sites, and that the the expenses, (including testing and benchmark rate for purposes of the final customer independently arranged for training if treated as direct selling determination. Comment 7 TKS’s May 31, 1996, the installation of the press additions. expenses), and the associated CEP profit would be deducted from the U.S. price. Submission of Corrected Sales, CV and TKS objects to the Department’s DOC Position: We disagree with TKS. FM data: The petitioner maintains that preliminary determination that the TKS’s argument is incorrect because the there are a series of corrections which number of hours spent on testing and issue of when title transfers is not TKS failed to include in its May 31, training by TKS personnel warranted relevant to the expense classification 1996, submission of revised sales, CV, the classification of these expenses as issue. The Department must examine and FM databases. According to the further manufacturing costs. TKS whether or not a party incurs costs and petitioner, TKS failed to make maintains that the quantity of time the nature of those costs. Whether a numerous corrections based on the spent on testing and training is not the manufacturer delivers goods CIF duty Department’s preliminary proper measure to determine such a paid U.S. port, delivered, FOB factory determination. Further, petitioner classification, and instead proposes that gate, or any other delivery designation disagrees with the argument filed by the terms of sale and nature of the work only designates which movement TKS on May 31, 1996, that if the performed by TKS should govern. TKS charges the manufacturer is responsible Department uses a five-year average states that at the initial stages of the for. As noted in the Department’s TKS USA indirect selling expenses investigation, both the petitioner and general comment section, LNPP ratio, then the Department cannot the Department appeared to consider installation is not being treated as a allocate G&A expenses based on the cost installation and testing and training as movement expense. All those expenses of sales without overstating indirect selling or movement expenses. TKS incurred by TKS which we have treated selling expenses. states that it ‘‘does not necessarily as further manufacturing, i.e., TKS contends that its May 31, 1996, agree’’ with the Department’s installation supervision as well as the submission was filed in direct response preliminary analysis that the size of the combined testing and training expenses, to the Department’s May 22, 1996, letter machinery and complexity of the work occur after title transferred. The instructing it to ‘‘incorporate all compel a classification of installation as Department does not have, as TKS corrections of factual information which further manufacturing. Nevertheless, implies, a policy whereby direct selling result from the verification procedure, even assuming that this conclusion was expenses are defined as being incurred both those which TKS identified prior valid, TKS argues that the Department’s after title passes. For example in to the commencement of verification reasoning does not apply to the specific Preliminary Results of Antidumping and those noted during verification.’’ services performed by TKS for the Dow Duty Administrative Review: Certain TKS maintains that it was not instructed Jones sale because all manufacturing Forged Steel Crankshafts from the to make the changes which the covered under the contract was United Kingdom, 60 FR 22045 (May 4, Department made at the preliminary completed prior to the importation of 1995), we treated pre-sale warehousing determination, as these involve the merchandise. Accordingly, TKS expenses as direct selling expenses methodological issues which TKS has describes the services as being the type because the producer had a general not conceded for purposes of the final of work which fits the definition of post- agreement with its U.S. customer to determination. As to the calculation of production technical services expenses. store subject merchandise; in that case TKS USA indirect selling expenses, TKS TKS points to its accounting records, we treated the warehousing as a direct argues that its submission was timely whose nomenclature assigns the title selling expense even though the and that the arguments rested on data ‘‘warranty jobs’’ in order to support its expenses was incurred before title provided in verification exhibit 27 to contention that any technical passed to the customer. .We note here the U.S. sales verification report. modifications required during that we would not have treated training DOC Position: We agree with installation do not represent further as part of total installation activities, but petitioner that not all methodological manufacturing and assembly. While since TKS could not report testing corrections necessary for the final TKS does not deny that the testing separately from training expenses, we margin calculation are reflected in the operations were complicated since treated the combined value of the two data submitted on May 31, 1996, by LNPP equipment is itself complex, it as part of total further-manufacturing. TKS. We have made, therefore, all does not believe this is sufficient Comment 6 Exchange Rate for the necessary corrections and grounds for characterizing the testing Spokesman Review Sale: TKS maintains methodological adjustments to the data and training expenses reported as that the Department incorrectly utilized reported on May 31, 1996, to reflect the further-manufacturing costs. TKS states the daily rate as published by the policies set forth in this final that such activity clearly did not involve Federal Reserve Board in converting determination of sales at less than fair an extension of factory work, but only values from yen to dollar amounts for value. With respect to the issue Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38153 concerning TKS USA indirect selling the Department applied this test in the Department should disregard COMAR’s expenses and G&A allocation, we have Final Determination of Sales at LTFV: negative interest expenses. modified the calculation of the G&A Fresh Cut Roses from Ecuador, 60 FR TKS argues that the reported indirect allocation to further manufacturing 7019, (February 6, 1995), where the overhead costs are based on the thereby eliminating any possible Department rejected a petitioner’s overhead expenses incurred in the double-counting with respect to the arguments that certain losses due to months in which production took place calculation of TKS USA indirect selling windstorms were foreseeable. After and that documentation reviewed at expenses. Accordingly, we are applying reviewing all incidents of accidents in verification both supports TKS’s the corrected ratio established in the TKS’s history of trucking presses, allocation methodology and reconciles TKS USA verification report. wherein less than one in three hundred to the company’s financial statements. U.S. shipments involved an accident, TKS concludes that petitioner’s Cost Issues TKS maintains that the accidents which argument is without basis, and that it is Comment 8 Treatment of Costs Due befell delivery of the Spokane unnecessary and unwarranted to adjust to Delivery Accidents: The petitioner Spokesman Review press additions the reported costs, particularly given the maintains that the Department was were similar to phenomena like relative insignificance of the costs to the incorrect in not including in the CV of windstorms, and other events which the total price. the Spokane Spokesman Review sale the Department has previously classified as TKS also rejects the petitioner’s additional incidental expenses which unforeseeable, infrequent, and hence argument to exclude the reported were incurred because of accidents extraordinary events. adjustment for interest income from the damaging portions of LNPP towers en DOC Position: As in the preliminary reported COMAR costs. TKS maintains route to the customer site, if those costs determination, the Department that the petitioner not only failed to cite were not covered by insurance. The maintains that the additional expenses any basis for its position, but also petitioner does not agree with the stemming from the accidents constitute, ignored the facts in this case warranting Department’s application of the in the words of the SAA at page 162 ‘‘an the adjustment. TKS argues that while it provision of the SAA which supports unforeseen disruption in production is true that COMAR does not incur any the exclusion of costs incurred due to that occurs which is beyond the interest expense, it is not true that there unforeseen events. In its preliminary management’s control.’’ See are no interest expenses added to the determination, the Department Memorandum from the Team regarding further-manufacturing costs. According concluded that TKS had general Exclusion of Two Sales, February 23, to TKS, the reported further knowledge of the possibility of 1996. As such, when an unforeseen manufacturing costs include interest accidents, but that any specific accident disruption in production occurs which expense computed as the sum of the was an unforeseen event. The petitioner is beyond the management’s control, the TKS consolidated interest rate factor argues that a respondent, in its Department will continue its current and the total further manufacturing decisions on how to pack and ship practice of using the original costs costs, which include those incurred by LNPPs, its selection of vendors, routes, incurred for production prior to the COMAR. timetables and insurers, knowingly unforeseen event. Therefore, for DOC Position: We agree with TKS in increases or decreases risks for the purposes of the final determination, we part. Contrary to petitioner’s assertions, particular transactions affected. did not include any of the additional the Department was able to verify that According to petitioner’s reasoning, if expenses incurred as a result of the TKS’s submitted indirect overhead costs certain costs are incurred which are not accidents, irrespective of insurance reconcile to those reported in COMAR’s covered by insurance, this situation coverage, in the CV for this sale. financial statements. COMAR does not arises from multiple factors which Comment 9 COMAR/Front Page ordinarily assign indirect overhead costs resulted from the respondent’s business Installation’s Reported Costs: The to each of its jobs. In order to submit a practices. Thus, petitioner argues, the petitioner alleges that TKS understated fully absorbed cost of production to the resulting costs are not truly ‘‘unforseen’’ the costs incurred by its affiliate Department, TKS developed what it and should be included in CV. COMAR/Front Page Installations characterized as an indirect overhead Petitioner presents several hypothetical (‘‘COMAR)’’. The petitioner maintains allocation rate. TKS allocated indirect situations in which costs increase due to that TKS reported costs for the overhead costs to each job on the basis events for which a producer cannot installation of one of the DMN sales of the ratio of indirect costs to direct have perfect foreknowledge, but which using an indirect overhead rate, costs during those months production traditionally have been included as CV. inclusive of G&A, which was occurred. The Department considers TKS maintains that petitioner is significantly lower than that contained TKS’s method of allocating indirect wrong to claim that specific accidents, in COMAR’s financial statements. The costs as a percentage of direct cost one of which resulted in a truck driver’s petitioner objects to TKS’s failure to reasonable. Accordingly, no adjustment death, were foreseeable and ordinary in reconcile the reported indirect overhead is deemed necessary. nature. According to TKS, the expenses with those recorded in We disagree, however, that COMAR Department’s preliminary determination COMAR’s financial statements, despite should be allowed to reduce production was correct in that it followed a two- instructions from the Department to do costs by the excess of interest income part test for determining if costs are so. Furthermore, the petitioner over interest expense. The Department sufficiently extraordinary to merit questions COMAR’s offset to actual allows interest expense to be offset by exclusion from the margin calculations. production costs for interest revenue, short term interest income, but only to TKS states that under the test used in which the petitioner claims is contrary the extent the company has interest the remand following the CIT’s decision to the Department’s long-standing expense. Not tying interest income in in Floral Trade Council of Davis practice. For purposes of the final this manner would allow companies to California v. U.S., Slip Op. 92–213, 16 determination, the petitioner maintains arbitrarily subsidize a product by C.I.T. 1014 (December 1, 1992), an that the Department should revise realizing financial activities not extraordinary expense must be: (1) COMAR’s submitted indirect overhead necessarily related to the production of Infrequent in occurrence and (2) costs based on the rate reflected in its the merchandise in question. unusual in nature. According to TKS, financial statements, and that the Accordingly, we disallowed COMAR’s 38154 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices reported reduction in production costs methodology as submitted and ignore Fair Value, 60 FR 22550, 22556 (May 8, for the excess of short-term interest petitioner’s request to apply as facts 1995) (‘‘The Department normally relies income over interest expense. available petitioner’s own unverified on the respondent’s books and records Comment 10 TKS Indirect Overhead overhead rates. prepared in accordance with the home Cost Allocations: The petitioner argues TKS argues that the information country GAAP unless these accounting that the Department should reject TKS’s provided to the Department during principles do not reasonably reflect the indirect overhead cost allocations. verification indicates that its allocation COP of the merchandise’’). Normal According to the petitioner, TKS method is not distortive. TKS notes that accounting practices provide an employed an allocation methodology during verification it demonstrated to objective standard by which to measure which was far more general than either the Department that both subject and costs, while allowing respondents a the other Japanese respondent or the non-subject products are treated predictable basis on which to compute respondent in the companion identically within its system. those costs. However, in those instances investigation of LNPPs from Germany. Additionally, TKS notes that there is no where it is determined that a company’s These other respondents generally indication in the verification report that normal accounting practices result in an calculated separate overhead rates for the Department believes the unreasonable allocation of production each major manufacturing process and methodology distorts costs. costs, the Department will make certain applied the rates only to those products TKS disagrees with petitioner’s adjustments or may use alternative which undergo the specific processing. contention that its allocation method methodologies that more accurately According to the petitioner, TKS failed fails to identify R&D costs incurred to capture the costs incurred. See, e.g., to provide any source documents, or specific LNPP projects. TKS maintains New Minivans from Japan; Final additional detail, for its overhead that it is unnecessary for the company Determination of Sales at Less Than allocation methodology, or to otherwise to keep product-specific R&D data and Fair Value, 57 FR 21937, 21952 (May support the factory overhead amounts gives several reasons why LNPP’s are 26, 1992). provided in its responses. The petitioner charged with the correct proportion of In the instant proceeding, therefore, objects to TKS’s pooling of LNPP R&D R&D expenses. the Department examined whether the expenses into company-wide overhead DOC Position: We believe that, in the respondent’s indirect overhead costs which were then allocated over instant proceeding, TKS’s method of allocation methodology results in costs total production, thus understating allocating indirect overhead costs is of producing the subject merchandise costs. The petitioner objects that TKS’s reasonable and have relied on it for the that reasonably reflect its cost of cost system charges much more final determination. The legislative production. At verification, the engineering cost to overhead accounts, history of section 773(b) of the Act Department requested and analyzed in as opposed to specific orders. Thus, states that ‘‘in determining whether detail source documents related to the petitioner reasons, TKS’s treatment of a merchandise has been sold at less than allocation of the three indirect cost large portion of engineering costs as a cost [the Department] will employ items making up a significant portion of part of common overhead results in a accounting principles generally the total indirect overhead costs. See shifting of costs from engineering- accepted in the home market of the TKS verification exhibits 26, 27 and 28. intensive press additions to press country of exportation if [the On a sample basis, we analyzed the systems, and thus from U.S. market Department] is satisfied that such significance of LNPP-specific indirect sales to home market sales. Finally, the principles reasonably reflect the overhead costs versus non-LNPP petitioner maintains that the fact that variable and fixed costs of producing specific indirect overhead costs. See TKS’s normal cost accounting system the merchandise.’’ H.R. Rep. No. 571, TKS verification exhibit 31. We noted goes no further to accurately assign 93d Cong., 1st Sess. 71 (1973) (emphasis that the respective product line-specific costs to particular sales does not absolve added). The CIT has upheld the amounts were comparable, supporting TKS from reporting reliable, actual costs Department’s use of expenses recorded the conclusion that TKS’s method for to produce the subject merchandise. in a company’s financial statements, allocating indirect overhead costs was Petitioner cites precedents where the when those statements are prepared in reasonable. As a result, we have Department required respondents to accordance with the home country’s determined that TKS’s method of report data in a more specific format GAAP and do not significantly distort accounting for indirect overhead is used than that created in the normal course the company’s actual costs. See, e.g., in the normal course of business, in of business. The petitioner thus requests Laclede Steel Co. v. United States, Slip accordance with Japanese GAAP and that the Department utilize Rockwell’s Op. 94–160 at 22 (CIT 1994). reasonably reflects the cost of producing information as facts available for the Accordingly, our practice is to adhere LNPPs. final determination. to an individual firm’s recording of We also disagree with petitioner that TKS maintains that its indirect costs, if we are satisfied that such by pooling R&D expenses into company- overhead allocation methodology is principles reasonably reflect the costs of wide overhead costs, TKS shifted costs used in the normal course of business, producing the subject merchandise, and away from U.S. press sales to home is in accordance with Japanese GAAP are in accordance with the GAAP of its market sales. Petitioner’s assumption and was thoroughly verified by the home country. See, e.g., Canned that TKS incurs higher R&D costs on Department. Respondent notes that it Pineapple Fruit from Thailand; Final press additions compared to that of complied fully with all requests for Determination of Sales at Less Than systems is purely speculative. It should information made by the Department. Fair Value (‘‘Canned Pineapple from also be clarified that the R&D costs TKS argues that a comparison of its Thailand), 60 FR 29553, 29559 (June 5, pooled and allocated by TKS in its allocation method to other companies is 1995); Certain Stainless Steel Welded ordinary course of business do not not the measure applied by the Pipe from the Republic of Korea; Final include engineering costs which relate Department in determining the Determination of Sales at Less Than to specific projects as petitioner implies. acceptability of an individual Fair Value, 57 FR 53693, 53705 These engineering costs are assigned to respondent’s allocation methodology. (November 12, 1992). See also Furfuryl the projects to which they relate. Therefore, TKS maintains that the Alcohol from South Africa: Final Lastly, we agree with petitioner that Department should accept its Determination of Sales at Less Than the Department has in past cases Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38155 required respondents to report cost data applicable to the entire company to of the expenses. TKS cites MTPs Final in a more specific format than that being more product-line specific. Determination (1990) where capitalized created in the normal course of DOC Position: We agree with TKS that interest was categorized as a business. We disagree, however, that in its classification of these costs as manufacturing cost instead of a credit this particular instance TKS needed to indirect overhead is reasonable. We expense, and where the Department allocate its indirect overhead cost data verified that the method TKS used to explicitly allowed the offset of in a more specific manner. TKS’s allocate the prior year workman’s capitalized interest expense against the primary business activity is the compensation, employee insurance and company’s overall interest expense in production and sale of LNPPs. rent costs is in accordance with its the calculations. TKS maintains that Additionally, TKS’s non-LNPP current accounting treatment of these likewise, the allocated movement, production activities utilize production costs and we consider it reasonable for selling, and general expenses included shops and sections that are also used by these costs to relate to manufacturing in the credit calculation should be used its LNPP operations. Since production operations. Additionally, we noted that to offset the amounts reported as a price of non-subject merchandise is relatively each overhead cost item is allocated adjustment or as a general expense for insignificant and the results of our based on the factor that drives the cost CV purposes. testing at verification revealed that costs (e.g., square footage for rent). We The petitioner contends that the are reasonably allocated, a more therefore relied on TKS’s submitted Department correctly calculated detailed cost allocation method is not reclassification of these indirect imputed credit expenses using the net deemed necessary. overhead costs for the final balance of costs incurred and progress Comment 11 The Reclassification of determination. payments made during the construction TKS USA’s Rent, Employee Insurance, Comment 12 Inclusion of General period. The petitioner alleges that TKS’s and Administrative Expenses in and Workman’s Compensation characterization of the Department’s Imputed Credit: TKS maintains that the Expenses: TKS objects to the calculation of imputed credit as a Department’s preliminary inclusion of Department’s preliminary determination ‘‘capitalized interest’’ methodology is general expenses in the imputed credit to disregard TKS USA’s reclassification incorrect, and that TKS’s references to calculation is contrary to the accounting of rent, employee insurance, and FASB 34 are not relevant. The petitioner principle governing the capitalization of workman’s compensation expenses from maintains that credit expenses are interest, is inconsistent with the SG&A to indirect overhead. TKS calculated using the sales price of the Department’s past practice, and at a merchandise sold, which includes not maintains that its total SG&A expenses, minimum results in a double-counting only the manufacturing costs, but also as reported on its audited financial of the expense items that were included amounts to cover general expenses. statements, encompass three categories: in the general expense factor. Accordingly, petitioner supports the (1) Indirect overhead expenses TKS cites Financial Accounting Department’s inclusion of general associated with the different divisions Standards Board (‘‘FASB)’’ rule 34 as expenses in the costs incurred, stating of the company; (2) selling expenses the accounting principle which the that this methodology was necessary to which are incurred in the selling of Department has relied upon in past keep the calculations internally presses; and (3) office administration cases as the rationale for capitalizing consistent, (i.e., so that the credit expenses which benefit the entire interest in cases involving merchandise income and offsetting expense would be company. TKS explains that in order to with extended production periods. TKS calculated on a reasonably consistent be consistent with its current interprets this principle as applying basis). The petitioner claims that G&A accounting treatment, it reclassified only to interest expenses, not to expenses have always been factored into rent, employment insurance, and movement, selling or general expenses, the Department’s normal credit expense workman’s compensation from office because general expenses are period calculation. administration to indirect overhead for costs which are not part of the capital DOC Position: We agree with two fiscal years of the POI. expenditures involved in the calculation petitioner that SG&A expenses should The petitioner objects to TKS’s of the capitalized interest. TKS be charged with imputed credit costs. request and states that the Department concludes that by including general As petitioner noted, it is the full cost of appropriately based its preliminary expenses in the calculation of imputed production rather than manufacturing calculations on the expenses as reported credit, and by calculating the net credit costs that should be assessed with in TKS’s financial statements. The expense as the difference between the imputed credit. Because SG&A, by petitioner states that TKS has not sum of production costs plus general definition, are included in COP, and submitted overwhelming evidence expenses and various progress because the purpose of the imputed which petitioner believes necessary to payments, the Department contradicts credit adjustment is to reflect the change classifications of items in FASB 34, which explicitly provides that interest cost associated with the audited financial statements. The the capitalized interest shall be production costs incurred and the petitioner disagrees with TKS’s determined as the net of the actual costs progress payments received during the contention that the 1995 classification and the actual progress payments. production phase of the LNPP, it is of such expenses requires a change to At a minimum, TKS contends that the appropriate to include SG&A expenses the prior years’ classifications of Department must adjust its calculation in the imputed credit calculations. expenses. The petitioner states that, methodology to avoid the double- Further, as also stated by petitioner, regardless of whether or not the prior counting of the expenses that are because the revenue side of our years’ results were reclassified, the included in the general expense ratio. calculation captures the entire LNPP expenses in question may appropriately Specifically, TKS claims that the price, the cost side of the calculation be classified differently depending upon allocation of movement expenses and should capture all production costs. the year incurred. According to the direct and indirect selling expenses to We disagree with TKS that the petitioner, internal re-organizations to U.S. credit without a proportionate Department double counted general accommodate an expanding product reduction of adjustments to CEP made expenses through its application of the line may change the nature of some for the same expenses under section 772 imputed credit adjustment. We expense from being reasonably of the Act results in a double-counting increased the base to which imputed 38156 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices credit expense was computed in order direct selling expenses with the denominator whether the sale was made to include all general expenses related movement cost incurred to ship the before or after the start of the POI since to each press sale. We did not, as TKS presses from Japan to the U.S. port. the expenses in the numerator apply to contends, increase the imputed credit Thus, if the Department decides to pre-POI sales as well. Even though the expense by the actual general expense apply the U.S. G&A expense to the cost pre-POI sales were negotiated and amounts incurred. of presses as imported, the Department concluded before MLP was founded, the Comment 13 Transportation and should deduct direct selling expenses Department calculates indirect selling Installation Charges and the Calculation from the COP of the Japanese press, expenses based on expenses and of CEP Profit: TKS maintains that the replace the home market indirect selling revenue recorded during the POI. Thus home market cost of production used in expenses with the export indirect the numerator of the factor calculated the preliminary determination did not selling expenses and add movement utilizes the expenses recognized by MLP include the reported transportation and costs from Japan to the U.S. port. in the normal course of business for the installation costs (‘‘PTI)’’, thereby DOC Position: Since we recalculated period in question and the denominator understating the total costs and TKS USA’s further manufacturing G&A of that factor utilizes the sales overstating the CEP profit ratio. TKS expense rate exclusive of the inputs recognized by MLP in the normal course requests that the Department adjust its acquired from TKS, this point is moot. of business for the same period. The calculations to properly account for all Department uncovered no manipulation costs associated with home market sales MHI-Specific Comments or distortion which would cause us to by summing the manufacturing costs Sales Issues reject MLP’s normal recording of and the transportation and installation revenue based on sales recognition. At Comment 1 Removing Certain Sales expenses. the preliminary determination the from the Denominator of MLP’s Indirect DOC Position: We agree with Department made an adjustment to the Selling Expense Calculation: The respondent that the Department numerator of the indirect selling petitioner argues that the U.S. indirect mistakenly excluded PTI costs in expense calculation, basing the selling expense factor calculated for computing CEP profit for the allocation of general sales office preliminary determination. For the final MLP is incorrect because of the expenses on sales revenue instead of the determination, we recalculated CEP inclusion in its denominator of certain head-count methodology submitted by profit to include the PTI costs. sales which were negotiated and MHI. We have therefore employed an Comment 14 Direct Selling Expenses concluded prior to MLP’s existence. MLP indirect selling expense factor for and COM for U.S. Sales: According to Thus, it concludes, MLP could not have purposes of this final determination TKS, if the Department continues to incurred indirect selling expenses which is exclusive of common G&A allocate the general expenses of TKS associated with such sales, and they expenses. See also Japan ‘‘Common USA based on COM inclusive of inputs should be removed from the Issues’’ Comment 9. acquired from TKS in Japan, then it denominator of the calculation. The Comment 2 Commission Paid to a should exclude home market direct parallel is drawn with MHI’s treatment Possibly Affiliated Trading Company for selling expenses from COM. Following of the Guard sale in its calculation of the Piedmont Sale: The petitioner TKS’s logic, the inclusion of the home MLP’s indirect selling expense ratio. maintains that, in the preliminary market direct selling expenses MHI argues that MLP properly determination, the Department overstates the cost of producing the included all LNPP sales recognized incorrectly treated the trading company merchandise sold to the U.S., and during the POI in the denominator of its involved in the sale to the Piedmont therefore overstates the amount of the indirect selling expense calculation, Publishing Company as an unaffiliated allocated general expenses associated because of the activities required entity. The petitioner cites many joint with each U.S. sale. According to TKS, beyond the direct expenses incurred for ventures by MHI and this trading home market direct selling expenses installation and warranty work. company as evidence that these are have no relevance to sales of U.S. Furthermore, MHI argues that for large, affiliated entities. The petitioner further merchandise, and, since all direct custom-built products, such as LNPPs, maintains that the relationships selling expenses incurred on U.S. sales the end of the negotiation process does inherent in the membership of MHI and have already been assigned a not signal the end of the sales process. the trading company in the Mitsubishi proportionate share of the TKS USA Therefore, MHI explains that MLP company group (‘‘Keiretsu)’’, including general expenses, it is thus unnecessary performed sales-related activities during the use of a common corporate name and improper to include any home the POI. Moreover, if only sales and logo, a tradition of company market direct selling expenses when negotiated during the POI are included, cooperation, cross-ownership of stock, allocating TKS USA general expenses to then the amount involved in the cross-lending and cross-borrowing, are further manufacturing operations. Washington Post contract should be indicators of affiliation. The petitioner maintains that TKS’s included in the denominator for indirect According to the petitioner, the argument that home market direct selling expenses. MHI explains that if affiliation status of the trading company selling expenses should not be included the petitioner’s logic is followed, then raises a critical issue regarding the in the COP is based on a presumption the MLP indirect selling expense factor commission it received from MHI in that the Department intended to allocate would actually decrease. According to connection with the Piedmont sale— the expenses to the cost of presses as MHI, indirect selling expenses for the namely whether that transaction was at imported (rather than the COP of the Guard were not included in the MLP arm’s length. The transaction is press sold in the home market). indirect selling expense allocation characterized as not at arm’s length by Assuming arguendo that TKS is correct, because MLP did not recognize the the petitioner, based on the relative size it agrees that the direct selling expenses revenue; MLP did recognize the revenue of the commission earned on the should not be included in the associated with the sales it did make Piedmont sale as opposed to that earned calculation of the cost of the press as that were negotiated outside of the POI. by Sumitomo Corporation (‘‘SC’’) for the imported. However, the petitioner states DOC Position: We disagree with the Guard sale. Because MHI did not that TKS neglected to mention that the petitioner. It is proper to include all provide the actual costs incurred by the Department would have to replace the sales recognized during the POI in the trading company involved in the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38157

Piedmont sale, the petitioner proposes DOC Position: The Department any way to MHI, and therefore under no that the Department apply the effective disagrees with the petitioner’s argument obligation to cooperate on MHI’s behalf. rate of the SC commission (i.e., the that the sale through the trading The MLP joint venture between MHI reported SC commission as a percentage company to Piedmont should be treated and the trading company does not in of the Guard sales value) to the value of as an affiliated party transaction for and of itself constitute control between the Piedmont sale. purposes of this final determination. MHI and the trading company. MHI maintains that its sale to Although MLP is owned jointly by MHI Moreover, MHI has cooperated and Piedmont is through a company which and the trading company, the attempted to provide information is not affiliated under the objective Department does not view the joint requested by the Department for its sale statutory criteria. MHI argues that the ownership, in this particular situation, through the trading company. Whether Department should reject the as a sufficient indication that MHI’s the trading’s companies lack of full petitioner’s request to adjust upward the relationship with the trading company cooperation vis-a-vis reporting its reported commission paid by MHI for is such that either is ‘‘operationally in expenses, as an unaffiliated party, the Piedmont sale. MHI argues that a position to exercise restraint or should impute any lack of cooperation investments between companies are not direction’’ over each other, as opposed to MHI is moot in this instance because covered under the statute, specifically to over MLP. We agree that cross- MHI was able to obtain the comparative joint ownership of subsidiaries. MHI ownership of stock, cross-lending and dependence data from its own and argues that the antidumping law cross-borrowing, a tradition of company public sources which was an important concentrates on the actual control of cooperation, and particularly, factor in our analysis of potential parties, and that mere joint ownership combinations of significant degrees of affiliation. Because the information does not rise to the level of control such relationships, are possible currently on the record allows us to required to find affiliation because the indicators of affiliation. However, the determine that for purposes of this trading company involved does not Department stated in its February 23, investigation, the trading company is exert direct control through its stock 1996, Concurrence Memorandum that not affiliated with MHI, the data which holdings. MHI argues that the the extent of stock ownership in the trading company did not submit is relationships among ‘‘Mitsubishi subsidiary organizations greater than not required as part of our margin companies’’ are insufficient to allow five percent between the companies calculations. MHI to control the trading company in (i.e., their joint ownership of numerous For purposes of this final the Piedmont sale, or to allow the enterprises, particularly LNPP determination, we have decided to treat trading company to control MHI. enterprises) is, by itself, an insufficient the Piedmont sale as a sale through an MHI argues that petitioner’s assertions indication of affiliation. We also unaffiliated trading company and have that MHI and the trading company are maintain that the degree of cross- affiliated through: membership in a used the commission as reported in our ownership and the level of joint- Keiretsu, common name and a logo, final calculation. We note, however, that financing between MHI and the trading traditional business relationships, the Department will continue to develop company are not significant enough to significant cross-ownership of stock, an analytic framework to take into be indicators of affiliation. and cross lending and borrowing, fail to account all factors which, by satisfy the ‘‘control’’ test for affiliation. In its March 8, 1996, submission, MHI themselves, or in combination, may MHI argues that the SAA does not provided the proportion of sales made indicate affiliation, such as corporate or presume that members of family by MHI through the trading company to family groupings, franchises or joint groupings are affiliated and that this is the number of total sales made by the venture agreements, debt financing, or only one factor for consideration. MHI trading company as well as the close supplier relationships in which also argues that nowhere does the proportion of sales made by MHI the supplier or buyer becomes reliant antidumping law or the SAA suggest through the trading company to the total upon the other. In future investigations that common name, logo, and sales made by MHI (i.e., comparative and administrative reviews, the traditional business relationships dependence data), basing the trading Department may need to re-analyze the establishes control. MHI also argues that company’s figures on publicly available different aspects of the Mitsubishi group affiliation through stock ownership is trade data. MHI also provided first examined here, based on policy measured by a five-percent-or-greater additional information on stock developments. threshold and the antidumping law does ownership in a third party, which was Comment 3 Proposing a Discount on not deem shareholders as affiliated zero. The Department requested MHI to the Guard Sale: The petitioner proposes based on comparative (i.e., cumulative provide the Department with that the Department treat an unpaid company group) share holdings. commissions received by the trading payment reported by MHI as a direct Furthermore, MHI argues that MHI and company from other parties not deduction from the gross Guard contract the trading company in the Piedmont affiliated with it, to use in case the price, in effect labeling the unpaid sale have no financing arrangements. Department determined MHI and the payment a discount. The payment was MHI further argues that the trading company to be affiliated and not made because of a dispute between commission paid for the Piedmont sale rejected MHI’s claim that the Guard and MHI, the nature of which is is an arm’s length transaction requiring commission for the trading company proprietary, and discussed in greater no adjustments. MHI explains that the was at arm’s length. We also detail in the July 15, 1996, calculation commission for the Guard sale was recommended that MHI request the memorandum. much greater because the role played by trading company to provide the trading MHI argues that the unpaid amount SC was more substantial than played by company’s selling expenses and G&A reported by MHI should not be treated the other trading company in the for the services provided to MHI in as a discount. MHI explains that from a Piedmont sale. Enumerating some of the making this transaction. However, MHI purely commercial perspective, it would additional functions performed by SC, stated that it asked the trading company make no sense to grant a discount MHI noted that it prospected for U.S. to provide the relevant sales information because the unpaid amount is customers, provided U.S. sales strategy, and that the trading company refused by significantly greater than the cost of the and negotiated the sale. explaining that it was not affiliated in item in dispute. 38158 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

DOC Position: We agree with documents as evidence of MHI’s certain circumstances partial petitioner that the adjustment to the involvement in the transaction between performance may ratify an unexecuted gross price of the Guard sale should be SC and Guard. According to the contract, it maintains that the made by treating the unpaid amount as petitioner’s analysis of relevant Department ignores the fact that the a discount. In the Final Results of documents, SC could not have acted as only contract to which MHI was a party, Antidumping Duty Administrative MHI’s sales agent because MHI and which could thus be ratified, was Review: Porcelain-on-Steel Cooking obviously confirmed that SC was not the purchase order fully consummated Ware From Mexico, 58 FR 43327 authorized to bind MHI to the sales later between MHI and SC, and which (August 16, 1993), the Department agreement between SC and Guard. The incorporated in it the terms of the applied BIA (now facts available) to petitioner maintains that there is no earlier contract between SC and Guard. those instances ‘‘where three U.S. documentary evidence that MHI Because the material terms of sale, customers refused to pay the full participated in the SC/Guard particularly price and quantity, were amount of [respondent] ITCO’s invoice’’ negotiations, especially with respect to established between MHI and SC at a even though ‘‘ITCO continued to carry the paramount issue of contract price. date later than the contract between SC the unpaid amounts as outstanding While recognizing the necessity that SC and Guard, the petitioner maintains that balances on their accounts and consult with MHI on technical matters the later date should be used in the continues to demand payment.’’ We such as press configuration and antidumping analysis as the correct date drew an adverse inference and reduced installation planning, the petitioner of sale. Accordingly, it was only at this reported prices for these ‘‘unauthorized emphasizes that there is no evidence on point in time that the essential terms discounts’’ because there was ‘‘no the record indicating MHI’s were firm so that the parties could no indication of reasonable expectation of involvement in establishing the price to longer unilaterally alter them. payment.’’ In the instant investigation of Guard and the payment schedule from MHI argues that the Department the Guard sale, there is again no Guard to SC. properly analyzed the sale to Guard as indication of reasonable expectation of Second, the petitioner maintains that a sale between MHI and Guard. MHI payment. Further proprietary details SC’s actions throughout the course of disagrees with the petitioner’s argument have been discussed on the record in the Guard transaction establish that it that MHI never had a contractual the Department’s July 15, 1996, was an independent trading company relationship with Guard. First, MHI calculation memorandum. and not a commission agent of MHI. argues it played an integral part in Comment 4 The Nature of the Guard According to the petitioner, SC acted in making the sale, such as developing cost Sale, Including the Date of Sale: The the capacity of an independent trading estimates used to set the price, signing petitioner maintains that the transaction company: it negotiated, established, and the contract as a witness, and issuing a which the Department classified as a subsequently modified, on its own letter to Guard guaranteeing sale by MHI through SC to the Guard authority and behalf, the terms of sale performance. Second, MHI argues the Publishing Company should instead by of the LNPP system to Guard. The law of agency provides that when a treated as a sale from MHI to the SC, petitioner provides its interpretation of party holds itself as an agent, it has the and that this price should be the basis the basic documentation underlying the ability to bind the principle. Third, MHI for U.S. price. The petitioner disagrees commission paid by MHI to SC, asserts that the petitioner’s argument with MHI’s characterization of SC’s role concluding that SC was not merely a that MHI must have produced this LNPP as that of a mere commission agent, commission agent. system as a ‘‘subcontractor’’ is presented primarily because MHI was not a The petitioner states that the without evidence. signatory party to the contract which Department should consider the date of MHI further argues that SC was a established the sale to Guard. Because sale to be that for the purchase order commissioned sales agent of MHI, as the only sales contract to which MHI placed between SC and MHI and that evidenced by the documentation was a party is the purchase contract the Department was incorrect in its submitted by it, and agrees with the issued by SC to MHI, the petitioner preliminary analysis, which concluded petitioner when it says the commission believes that the Department’s trading that MHI’s role was tantamount to that agreement did not create a sales company rule requires the Department of a seller in the original transaction contract. MHI maintains that it is a to treat the sale as made between MHI between SC and Guard, based on (1) document which establishes the basis and SC. Citing the Final Determination: MHI’s offer to be responsible for SCs for a commission arrangement between Certain Forged Steel Crankshafts from obligations to Guard if there were to be a manufacturer and a sales agent and Japan, (52 FR 36984, October 2, 1987) a failure of performance by SC, and (2) that the amount of SC’s commission (‘‘Forged Crankshafts’’) and the court MHI’s commencement of the design and never involved post-sale negotiation. ruling Peer Bearing Co. v. United States, construction of the press prior to a MHI also argues that the Department’s 800 F. Supp. 959, 964 (CIT 1992) (‘‘Peer written agreement between MHI and SC. ‘‘trading company’’ rule is not Bearing’’), the petitioner states that the According to petitioner’s interpretation, applicable to this sale. More trading company rule provides that a the unilateral offer by MHI to guarantee specifically, MHI maintains the sale to a trading company in a foreign SC’s obligation to provide a conforming petitioner’s contention that the market is a sale to the United States if press system does not alter the fact that Department should treat the purchase the manufacturer knows that the SC sold the subject merchandise to the orders between MHI and SC as merchandise is destined for the United Guard, but should be interpreted as a constituting the actual sale is wrong. States at the time the sale is made. warranty by the press manufacturer that First, MHI contends that the Department First, the petitioner maintains that the it would ultimately produce the goods recognized that MHI did not sell a press evidence examined by the Department sold by the independent trading to SC. Second, MHI contends that the establishes that MHI sold the Guard company. The objection is raised that trading company rule allows the LNPP system to SC. The petitioner the Department misreads the U.C.C. Department to capture a respondent’s stresses that the contract for sale from provision on performance in connection sales which are delivered to the United SC to Guard establishes this as fact. with MHI’s initial design and States, where the respondent knows at Petitioner criticizes the Department’s production activities. While the the time of sale that the merchandise is acceptance of several subsidiary petitioner does not dispute that in destined to the United States. MHI Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38159 argues that the essential function of the negotiations between SC and Guard. providing the merchandise which rule is to determine which of a Moreover, MHI’s role as signatory fulfilled SC’s obligations to Guard. respondent’s sales should be included witness on the contract between SC and Moreover, after MHI signed the contract in the dumping calculation, and Guard is evidence of MHI’s direct between SC and Guard as a witness, it contends that the trading company rule involvement with the sale of the began to design an LNPP system to has been used to establish the proper product in the U.S. market. The nature Guard’s unique specifications. Thus, it U.S. price when the trading company of this product shows that each sale demonstrated its intent to be legally acts as an independent reseller of involves merchandise which must meet bound to the agreement through written subject merchandise. Accordingly, a the unique specifications of the instruments and its own performance on different interpretation is given to Peer customer, and the record shows that the contract. See U.C.C. § 2–201(3)(a). At Bearing whereby MHI holds that the MHI began to design and construct the verification, the Department examined ruling does not require the Department merchandise shortly after witnessing the the written evidence and confirmed the to use the price contained on the contract for sale arranged by SC on its actual company performance to support purchase order, but stands for the behalf. Therefore, we determined that its conclusion for date of sale. Based on proposition that the trading company the appropriate transaction for use in this evidence, the Department rule is discretionary, based on the facts our antidumping analysis is the price determined that, by virtue of MHI’s of the case. MHI also maintains that the established in the sale of LNPP from participation in the sales process and its Forged Crankshafts does not apply MHI through SC to Guard. performance to fulfill the terms of the because in that case the trading The Department disagrees with the contract, MHI was a party to the sales company was responsible for setting the petitioner when it states that the date of agreement with Guard. price and MHI was responsible for sale should be that for the purchase Comment 5 Treatment of Technical establishing the final price in this order placed between SC and MHI. As Service Expenses: MHI maintains that investigation. Thus, application of the stated in the preliminary determination, the Department erred in its treatment of trading company rule under these section 773(a) of the Act mandates the technical service expenses for the circumstances would be inappropriate. Department to compare the appropriate following reasons. First, MHI posits With respect to the date of sale transaction to the ‘‘normal value’’ of the that, even assuming arguendo that debate, MHI argues that the Department subject merchandise. Neither the statute installation is treated as further correctly determined the proper date of nor the regulations determine the manufacturing activity, the technical sale. MHI cites MTPs Final precise ‘‘date of sale.’’ Our proposed services MHI provided had nothing to Determination (1990) which states that, regulations provide that the Department do with further manufacturing as they for sales of custom-built merchandise, will ‘‘normally’’ rely on the date of a were incurred after installation and the Department should establish a date company’s invoice date as the date of should not be treated as a part of at the earliest date when terms are fixed. sale. Our practice must also allow for installation. Second, MHI argues that MHI explains that there was confusion specific instances where commercial the Department has usually treated regarding MHI’s sales process in the realities dictate the use of some other technical service expenses as home market for certain sales because instrument to set the date of sale. Our circumstance of sale adjustments, and the essential terms of the sale were not proposed regulation recognized that the should do so again. fixed until the purchase order to the invoice date ‘‘may not be appropriate in The petitioner argues that in the trading company was issued. MHI some circumstances.’’ In this instant Department’s preliminary determination maintains that the Guard sale is quite investigation, where the long-term sales it appropriately treated MHI’s different, because MHI signed the sales negotiations, design, production, ‘‘technical service’’ expenses as an contract. shipment and installation of LNPPs installation expense, because when the DOC Position: The Department agrees require contractual documentation, the addendum to the contract covering how with MHI that the preliminary date of sale of the subject merchandise such expenses are to be incurred is read determination properly treated the sale is best established by the date a contract in conjunction with the original terms of to Guard as a sale between MHI and is signed. Consistent with case the contract, it is clear that these Guard. In the Department’s February 23, precedents involving complex technical service expenses relate 1996, decision memorandum, we stated merchandise, such as LNPP, which is directly to an alternative method of that one of the main issues was whether custom-made, the Department exercised ensuring the customer that MHI would the sales price between MHI and SC or a greater degree of flexibility in finding provide trouble-shooting and other the sale price between SC and Guard is the existence of a firm agreement. See services associated with installation. the appropriate price for our dumping MTPs Final Determination (1990). The DOC Position: We disagree with the analysis. Because MHI originally only Department’s determination of the date respondent. The Department correctly reported the price from MHI to Guard, of sale was supported by its included technical service expenses as a we requested that MHI submit the price examination of the sales documentation part of total installation expenses. The of its sale to SC, as well as provide all submitted by MHI. We also looked to sale of an LNPP involves the sale of a basic documentation relating to the contract law (see, e.g., Gray Portland functional large newspaper printing roles of Guard, SC, and MHI in this Cement and Clinker from Mexico, 55 FR press. The processes involved in transaction. In our preliminary 29,249 (1990)) to identify the point in installing the LNPP equipment include determination, we explained that the time when the essential elements of the all those steps necessary to bring the sales documentation provided by MHI sale are firm, thus demonstrating an equipment to a functional stage. This demonstrated its integral involvement intent to be legally bound. perspective also underlies our in the Guard transaction. No While the date set by the contract classification of the total installation information placed on the record since signed by SC and Guard clearly costs as part of further manufacturing. that time, nor any information reviewed identifies the seller (SC) and buyer All expenses, including component during verification, contradicts that (Guard) and sets the quantity and price assembly, integration of newly sourced conclusion. Following the commission for this transaction, MHI witnessed the auxiliary components, site preparation, agreement between MHI and SC, MHI sales agreement between SC and Guard installation supervision, technical was kept fully apprised of the and accepted responsibility for servicing, equipment testing, which 38160 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices make the LNPP physically functional, that it would be methodologically time value of U.S. dollars, the currency are part of an installation process which inconsistent for the Department to of transaction. The petitioner cites the creates the actual LNPPs which ‘‘are multiply the price of LNPP less spare Final Results of Administrative Review: capable of printing or otherwise parts when the indirect selling expense Certain Cut-to-Length Carbon Steel Plate manipulating a roll of paper more than ratio includes indirect selling expenses from Sweden, 61 FR 15772, 80 (April 9, two pages across’’ in the production of for spare parts in the numerator and 1996) and the Final Results of newspapers. The Department is treating spare parts revenue in the denominator. Administrative Review: Certain training expenses, where possible, as a Comment 7 Interest Rate Used for Corrosion-Resistant Carbon Steel Flat separate category of direct selling Calculation of Imputed Credit Expenses: Products from Australia, 61 FR 14049, expenses, since training involves the MHI argues that the Department’s 54 (March 29, 1996) to support its development of customers’ personnel’s practice of matching the denomination argument that sales are matched to the operation skills, not the physical of the interest rate used in calculating currency in which the sale is preparation and necessary modification imputed credit to the currency in which denominated. Furthermore, the of the actual merchandise which the sales are denominated is not petitioner argues that the Department’s produces newspapers. applicable in this case. MHI explains approach is consistent with LMI where Comment 6 Inclusion of Indirect that it is inconsistent with the the court stated that ‘‘the imputation of Selling Expenses Allocable to Spare requirement articulated in LMI-La credit cost itself is a reflection of the Parts: MHI maintains that it reported Metalli Industriale, S.p.A. v. United time value of money. * * * ’’ MLP indirect selling expenses for U.S. States 912 F.2d 455, 460 (Fed. Cir. 1990) DOC Position: We disagree with sales based on the total contract price of (‘‘LMI’’) and interpreted by the CIT in MHI’s argument that the Department’s each U.S. sale, inclusive of the value of United Engineering & Forging v. United practice of matching the denomination spare parts. Accordingly, MHI maintains States, 779 F. Supp. 1375 (CIT 1991), of the interest rate used in calculating that its calculation of those indirect aff’d, 996 F.2d 1236 (Fed. Cir. 1992) that imputed credit to the currency in which selling expenses pertained to both LNPP the interest rate used for imputed credit the sales are denominated is not systems and spare parts covered by the accord with ‘‘commercial reality’’ and applicable in this case. As cited in our contract. Because the sales contracts for must be ‘‘on the basis of usual and February 23, 1996, Concurrence MHI’s U.S. sales separately identified reasonable commercial behavior.’’ MHI Memorandum for the preliminary the value of spare parts, in its argues that the Department’s approach determination, the Department preliminary determination, the used in the preliminary determination is explained its policy in selecting the Department deducted the value of spare inconsistent with the principles of interest rate applicable in calculating parts from the starting price. MHI argues determining credit expenses based on imputed credit expenses in the Final that because it allocated its indirect the lowest available interest rate, and on Determination of Sales at LTFV: Oil selling expenses based on the total the lowest rate of the country of Country Tubular Goods from Austria, 60 contract price of the LNPP and spare manufacture when foreign borrowing is FR 33551, 33555 (June 28, 1995) parts, the Department should exclude an not available to the respondent. (‘‘OCTG from Austria’’): allocable amount for indirect selling Moreover, MHI contends that the A company selling in a given currency expenses incurred on behalf of these Department ignores the commercial (such as sales denominated in dollars) is spare parts. reality for MHI, which is that all of its effectively lending to its purchasers in the The petitioner argues that MHI’s short-term debt was denominated in currency in which its receivables are argument that the indirect selling rate yen, so that MHI financed its working denominated (in this case, in dollars) for the should be multiplied by the price of an capital and accounts receivable for both period from shipment of its goods until the LNPP less spare parts is domestic and export sales with yen- date it receives payment from its purchaser. methodologically inconsistent, since in denominated financial instruments. Thus, when sales are made in, and future payments are expected in, a given currency, any rate-based allocation, the MHI maintains that it would have been the measure of the company’s extension of transaction-specific value to which the irrational, in view of the lower interest credit should be based on an interest rate tied rate is applied should be calculated in rates available in Japan, for it to borrow to the currency in which its receivables are the same manner as the denominator in dollars. MHI maintains that the use denominated. Only then does establishing a used in the rate calculation itself. The of different interest rates for U.S. and measure of imputed credit recognize both the petitioner asserts that the denominator Japanese sales is unreasonable since time value of money and the effect of used in the calculation of the indirect production costs for LNPPs sold in both currency fluctuations on repatriating selling rate includes the value of spare markets were incurred in the same revenue. parts. Therefore, the petitioner states factory. MHI explains the circumstance The Department disagrees with MHI’s that it would be inconsistent to apply of sale adjustment for differences in statement that the interest rate used by the rate to the price of LNPP less spare credit terms between the U.S. market the Department is not in accord with parts. Furthermore, the petitioner argues and comparison market is designed to ‘‘commercial reality.’’ The ‘‘commercial that spare parts are not sold but are separate true price discrimination from reality’’ should be evaluated on the included free-of-charge in the LNPP sale differences in prices that arise from basis of recognizing imputed credit on and are thus a selling expense differences in commercial credit terms the time value of money and the effect themselves, and should not carry the in each market. of currency fluctuations on repatriating burden of an additional selling expense. The petitioner argues that the revenue. Furthermore, at verification the Accordingly, the Department should Department correctly applied a U.S. Department noted that MHI had U.S. continue to allocate total LNPP indirect dollar-denominated interest rate to short-term borrowing from an affiliated selling expenses to the total LNPP sales. compute MHI’s imputed credit expenses company. Thus, while the Department DOC Position: The Department on U.S. sales. The petitioner contends would not use the actual interest rate of disagrees with the respondent’s that the Department followed its the borrowing from an affiliated argument that the Department should established policy of basing imputed institution (as it is of questionable exclude an allocable amount of indirect credit expenses on the interest rate of arm’s-length nature), its existence selling expenses incurred on behalf of the currency in which the sales are indicates the ability and readiness of spare parts. We agree with the petitioner denominated to correctly reflect the MLP, in general, to support its LNPP Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38161 activities which result in U.S. dollar- DOC Position: We disagree with the with the free parts and free services, but denominated revenues by borrowing in petitioner, in part. The direct payment would modify its conclusion to state U.S. dollars. Thus, the Department’s portion of the commission, together that MHI did not report the net value of approach is consistent both with its with the amount of ‘‘mark-up’’ between the free parts and services as an practice in OCTG from Austria in that the contract value at which Guard adjustment to the gross price; this is the first priority is to match the purchased the LNPP and the invoice important because MHI did provide the denomination of the interest factor to price which was owed by SC to MHI, value of other free materials both in the the denomination of the receivables in have both been treated as the total form of a deduction from gross price question and with LMI in that credit commission amount on the sale. As and, alternatively, as an addition to total costs are imputed ‘‘on the basis of usual noted in MHI comment 4, above, the contract costs. Since the Department, in and reasonable commercial behavior.’’ Department has determined that the its preliminary determination, deducted Comment 8 U.S. Dollar Short-Term correct sale is from MHI to Guard, and similar free options from the total Borrowing from Unaffiliated Lenders: that the correct starting price is the price contract price wherever possible, MHI notes that as observed in the MLP paid by Guard. We must therefore instead of increasing CV by the sales verification report, MLP had a deduct from the starting price whatever associated costs, our verification report small amount of U.S. dollar- actual sales revenue was not received by note was intended to reflect that MHI denominated borrowing from an MHI, that is, the mark-up between the had not used the same identifiable affiliated company but also maintains purchase price between MHI and SC format for the materials and services in that this fact does not warrant any and the amount paid by Guard to SC. question. Because the costs of free revision to MHI’s reported data. Stating We disagree, however, with the services were subsumed in the total that it had no borrowing in U.S. dollar- petitioner’s suggestion that the expenses reported to the Department, denominated instruments from any additional amount of interest income and used in the current format of the unaffiliated lenders, and that since the earned on payments from the Guard to calculations, no modification to the U.S. Department’s normal practice is to SC and kept by SC in agreement with price for the free services is required. exclude borrowings from affiliated MHI, be deducted from the reported However, because the production cost of lenders in the computation of short-term gross price. The majority of the interest free parts is not being included in CV, interest rates for imputed credit, MHI earned on the payments from the Guard the total value of free materials reported claims that the affiliated borrowing is to SC was retained by SC. Only a small to the Department for the Guard contract technically irrelevant to the margin portion of the interest earned was has been increased by the value for the calculations. transferred to MLP and included by additional free parts observed at DOC Position: The Department agrees MHI as a U.S. price increase. The verification. The proprietary details are with MHI that it is the Department’s amount of interest income retained by contained in the July 15, 1996, MHI practice to apply only short-term SC represents the time value of SC Calculation Memorandum. holding payments from Guard. Our borrowing which is from unaffiliated Cost Issues parties. Therefore, the Department will imputed interest calculations begin measuring credit income/expense from not make any adjustments to imputed the time payments begin to be made Comment 11 Allocation of Further credit using the short-term interest rate from SC to MHI. Because we verified Manufacturing G&A: The petitioner from MHI’s affiliated company. payments as received and recorded by agrees that the investigation period for Comment 9 Guard Commission: MHI (SC being an unaffiliated party not MHI provides an adequate time frame to MHI maintains that the amounts it subject to verification), we should not sufficiently alleviate annual fluctuations reported for its commission payments use Guard’s payment structure to SC as and provide a representative U.S. G&A on the Guard sale were verified and the framework for our imputed interest rate for MLP. However, the petitioner contends that the values it reported are calculation. Thus we should not include objects to the methodology employed at correct and accurately reflect the the measure of the time value of holding the preliminary determination in structure of this complicated payments during that same time frame, applying this rate to individual U.S. transaction. If the Department were to i.e., as payments flowed from Guard to sales. According to the petitioner, MHI modify the amount of commission SC, in determining the extent of the calculated the U.S. G&A rate by dividing reported, then MHI argues that the commission. However, as a corollary, MLP’s total LNPP G&A expenses by Department should ensure that it makes we should not, and do not, include the total LNPP sales revenue. Petitioner a comparable adjustment in the imputed additional payments from SC to MHI protests that the Department incorrectly credit earned by MHI on the sale. which resulted from interest income allocated U.S. G&A expenses back to The petitioner argues that verification earned but not kept by SC for that same individual U.S. sales in the preliminary confirmed that MHI misreported the time frame—such amounts, because determination by multiplying this U.S. total ‘‘commission’’ earned by SC on the they exceeded the limits on actual G&A rate by the costs associated with Guard sale and argues that SC retained interest income agreed to with MHI, U.S. further manufacturing only. a payment and mark-up, plus an were turned over to MHI by SC. According to petitioner, the Department additional amount not factored into the Comment 10 Cost of Services and has two remedies available: (1) If the commission calculation. In order to Materials Provided to MHI’s Customers: Department continues to accept a U.S. argue that the additional amount was MHI disagrees with the conclusion G&A expense ratio based on total LNPP interest earned on payments from the stated in the MHI sales verification sales revenue, then it must apply that Guard to SC which was ‘‘kept by SC in report that the net value of free services rate to the entire value of each sale, or agreement with MHI,’’ the petitioner and materials provided on the Guard (2) the Department may recalculate a cites directly to the Department’s sale were not reported in MHI’s U.S. G&A rate based on MLP’s LNPP verification report. The petitioner response. MHI contends that all costs cost of sales for the relevant period and asserts that even though the additional associated with both parts and services multiply this revised rate by the total income was used to cover U.S. duties were reported to the Department. cost of sales (i.e., the foreign COP plus and brokerage, it should be included as DOC Position: The Department agrees U.S. further-manufacturing costs) of commission expense. that MHI reported the costs associated each transaction. 38162 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

While the petitioner asserts that the merchandise which accounts for a request COP data from an affiliated Department under-allocated U.S. G&A significant percentage of the total cost of supplier. expenses, MHI maintains that U.S. G&A materials, the total labor costs, or the We disagree with MHI that the expenses were over-allocated. MHI overhead costs to produce one unit of Department failed to apply its normal argues that the rate computed was based the merchandise under review. MHI ‘‘significance’’ test in determining that on an allocation of both G&A and refers to antidumping questionnaires an input which represents at least two indirect selling expenses over MLP’s issued by the Department in recent percent of the total cost of materials, cost of goods sold and not over sales proceedings to support this definition of labor, and overhead for any one of the value, as petitioner claims. MHI asks a major input. MHI argues that the five press components represents a that the Department utilize the Department’s thresholds of two percent major input in accordance with section allocation formula presented in its case for components and five percent for the 773(f)(3) of the Act. In a typical case in brief for purposes of the final system are not representative and that a which the subject merchandise only determination. range of ten to twenty percent is more requires a few inputs, we agree that a DOC Position: We agree with representative. threshold of two percent for defining a petitioner that in the preliminary Petitioner asserts that MHI has major input appears low. However, in determination, a G&A rate which was misconstrued the statute. Petitioner this case, LNPPs require thousands of based on MLP’s total LNPP sales was states that the statute does not require inputs, with no single input applied to only the costs associated with the Department to have ‘‘reasonable representing a large share of the total further manufacturing. For the final grounds’’ to believe or suspect that an LNPP cost. MHI obtained from affiliated determination, we recalculated a G&A input was sold at less than cost of suppliers numerous inputs representing rate based on MLP production costs production in order to allow it to over two percent of the total cost of a incurred in the U.S. and applied the rate investigate affiliated supplier component (none of which represent to MLP’s further manufacturing costs. transactions. Petitioner indicates that more than five percent of the LNPP total This method effectively allocates G&A the statute’s requirement is that the production cost), the sum of which expenses to the individual U.S. sales on Department have such ‘‘reasonable represents a significant portion of the the same basis used to calculate the rate. grounds’’ in order to permit total LNPP cost of production. In our computation of the G&A rate, we determination of the value of the major Accordingly, since the inputs we tested excluded the indirect selling expenses input on the basis of information represent the most significant inputs that were erroneously included in the available regarding such cost of used to produce the subject LNPPs, we submitted MLP G&A rate used in the production, citing section 773(f) of the consider it appropriate in this instance preliminary determination. Act. to categorize inputs meeting the two Comment 12 The Application of the Petitioner disputes MHI’s contention percent threshold as major inputs. Our Major Inputs Rule: MHI argues the that the Department’s thresholds for point is best highlighted by the Department misapplied the major inputs major inputs of two percent for following hypothetical situation. rule and maintains that the rule is components and five percent for the Suppose 100 percent of the inputs to a appropriate only in the context of system are arbitrarily low. Petitioner press were obtained from affiliated diversionary dumping. MHI argues that claims MHI’s position is based on suppliers, with no one supplier the Department’s application of the considering only the relative value of an providing more than two percent of the major input rule cannot be reconciled input compared to the total production total. Under MHI’s interpretation, the with the purpose of the rule. MHI states costs of an LNPP, failing to consider the Department would have no authority to that major input prices can be adjusted value of the input in absolute terms, test whether affiliated supplier only when the Department has received which may be significant even when the purchases occurred at above cost prices a specific allegation of below-cost sales relative percentage is not. even though 100 percent of the LNPP of major inputs. In this investigation, DOC Position: We disagree with MHI inputs were obtained from affiliated the Department has not received any that the Department inappropriately suppliers. Even MHI recognizes the obtained cost information from MHI request from the petitioner to investigate unique nature of this case in suppliers deemed affiliated. MHI below-cost sales of major inputs. MHI determining what constitutes a major incorrectly interprets section 773(f)(3) of claims the Department requested COP input. In an August 24, 1995 letter from the Act to mean that the Department information from MHI suppliers it MHI’s counsel, MHI stated that: deemed affiliated without the must have reasonable grounds to believe ‘‘reasonable grounds’’ necessary for or suspect that a transaction between [W]ith respect to suppliers of parts, such a request. two affiliated parties occurred at below- materials or services incorporated into large Furthermore, MHI argues that, if the cost prices in order to request cost newspaper presses, the Department should request ‘‘affiliated party’’ information only Department were to argue that its information from the respondent’s from suppliers of ‘‘major inputs’’ of parts, application of the major inputs rule in affiliated suppliers. In NSK Ltd. et. al. v. materials or services * * *. For example, if this case was an application of the United States, Slip Op. 95–178 at 14–45 a major input were defined as any input ‘‘transactions disregarded’’ rule, then (CIT November 14, 1995) the CIT ruled accounting for one percent of total purchase such an approach would still be that the purpose of section 773(f)(3) of price * * * 90 percent of the * * * suppliers contrary to the Department’s the Act is to permit Commerce to use could be ignored because their sales fall administrative practice for investigating best evidence available (i.e., the cost of below this figure. and adjusting the input prices for producing the input) when it has Comment 13 Definition of An affiliated parties. MHI contends that the reasonable grounds to believe or suspect Affiliated Supplier: MHI argues that the methodology employed at the that below-cost sales occurred. The Department failed to provide an preliminary determination differs Court stated that there is no support in explanation of its selection of affiliated radically from that used in other the legislative history of section suppliers, thereby acting unreasonably. proceedings initiated since enactment of 773(f)(3) of the Act for the claim that the MHI argues that a statement of reason the URAA insofar as the Department has Department must have reasonable (e.g., that a party is ‘‘legally or normally defined a ‘‘major’’ input as an grounds to believe or suspect that operationally in a position to exercise essential component of the finished below-cost sales occurred in order to restraint or direction over {an}other Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38163 person)’’ is required, citing A. Hirsch v. affiliation may be based on a close framework to take into account all United States, 729 F. Supp. 1360, 1363 supplier relationship. Section factors which, by themselves, or in CIT. Instead, the Department’s section D 771(33)(G) of the Act, in addressing combination, may indicate affiliation, questionnaire suggests that the affiliated persons, defines such such as corporate or family groupings, Department defines ‘‘control’’ in terms affiliation by the following: ‘‘any person franchises or joint venture agreements, of sales dependence, insofar as the who controls any other person and that debt financing, or close supplier questionnaire requested that MHI ‘‘list other person will be considered relationships in which the supplier or the major inputs received from all affiliated persons.’’ Section 771(33) of buyer becomes reliant upon the other. In affiliated suppliers as well as from the Act makes clear that control exists future investigations and administrative suppliers that furnish more than 50 if one person is ‘‘legally or operationally reviews, the Department may need to percent of their total annual sales to in a position to exercise restraint or reanalyze the different aspects of the {MHI}.’’ MHI claims the Department direction over the other person.’’ Mitsubishi group first examined here, erred in using what it believes to be a Further, the SAA, at 168, cites a close based on these developments. 50 percent threshold of total annual supplier relationship as an example of Comment 14 Facts Available for sales to determine affiliation because such a situation. The SAA explains that Affiliated Suppliers: MHI argues that, by such a delineation is excessively low, ‘‘the traditional focus on control failing to apply a reasonable affiliated lacks predictive value, and is through stock ownership fails to address parties methodology, the Department inconsistent with the stringent statutory adequately modern business incorrectly relied upon the use of ‘‘facts criteria for determining affiliation. MHI arrangements, which often find one firm available’’ and thus overstated MHI’s states that the Department should apply operationally in a position to exercise estimated preliminary dumping margin. the criteria listed in the statute restraint or direction over another’’ and MHI maintains that the Department was including formal criteria that indicate that ‘‘a company may be in a position incorrect in penalizing MHI for those an actual, legal ability to exert control: to exercise restraint or direction, for suppliers that did not report their membership in a corporate family; example through corporate or family production costs to the Department. common officers and directors; groupings, franchises or joint venture MHI argues that the Department did not partnership; employer-employee agreements, debt financing, or close give due consideration to the constraints relationships; and direct or indirect supplier relationships in which the contained in section 782(c)(1) of the ownership or five percent or more of the supplier or buyer becomes reliant upon Act, which provide that if an interested outstanding stock of an organization. the other.’’ These SAA quotations refute party promptly notifies the Department MHI contends that the Department’s MHI’s assertion that we should that it is unable to submit the requested greater-than-fifty-percent sales determine affiliation based solely on a information, the Department ‘‘shall dependence test is clearly inconsistent person’s legal ability to exert control consider the ability of the interested with these other criteria. Because sales over another person. party to submit the information in the dependence is not an actual, legal Early in this investigation, we requested form and manner and may means for exerting direction or control, requested information regarding each modify such requirements to the extent its predictive value is potentially less supplier identified as providing MHI necessary to avoid imposing an than that of the other statutory with a production input representing unreasonable burden on that party.’’ affiliation criteria. MHI suggests that a greater than two percent of the total cost MHI argues that two of its suppliers very high sales-dependence threshold, of manufacturing (‘‘COM’’) for any one were unable to submit the requested such as a weighted-average of 80 component of an LNPP. From this information and that it promptly percent over four years, would make the information, we selected a sample of notified the Department. MHI claims Department’s affiliation test predictive. MHI suppliers based on either a that it is affiliated to neither of these Petitioner contends that combination of supplier reliance and suppliers. One supplier stated that it is determination of affiliation may be employee relationships, or on not in any way affiliated with MHI or based on a close supplier relationship. significant supplier relationships over subject to MHI’s direction or restraint. Petitioner quotes the SAA, which states an extended period of time. We The other supplier explained that it was ‘‘A company may be in a position to requested and were provided with cost a small company and does not maintain exercise restraint or direction, for information for these suppliers (except cost records by product line. MHI argues example through corporate or family that, for one supplier, MHI informed the that because the company is not groupings, franchises or joint venture Department that the supplier could not affiliated to either of the two suppliers, agreements, debt financing, or close segregate costs on a product-specific the Department should not assume that supplier relationships in which the basis, and for two others MHI did not MHI purchased the inputs from these supplier or buyer becomes reliant upon submit cost data because it maintained suppliers at below-cost prices. the other’’. Petitioner asserts that a that the suppliers were not affiliated). Therefore, MHI claims that the company that purchases over 50% of a Although we requested MHI to list Department should not have adjusted supplier’s sales could extract price and inputs obtained from suppliers that the prices to MHI from these suppliers. other concessions from the supplier by furnished more than 50 percent of their Petitioner claims that MHI’s assertion threatening to purchase the products total annual sales to MHI, we never that the Department misapplied facts from another vendor. Because such an indicated that this constitutes available is entirely without foundation. action would severely impact the affiliation. Petitioner asserts that by applying a business of the supplier, the purchasing Our treatment of close supplier weighted-average affiliated supplier company is in a position to control the relationships in this case is not adjustment to the prices of the non- related supplier by exerting restraint or necessarily an indication of our future reporting affiliated suppliers, the direction over the supplier. Thus, practice. Since this part of the law is Department adjusted the non-reporting petitioner argues that the Department’s new to the Department, we need to affiliated suppliers’ prices to reflect the definition of affiliated suppliers is in refine our interpretation and application differences between the transfer prices accordance with the statute. of the close supplier provision over and the costs of production for the DOC Position: The Department agrees time. We note that the Department will reporting affiliated suppliers. Petitioner with petitioner that determination of continue to develop an analytic argues that the application of such an 38164 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices actual weighted-average cost-of- costs. Although petitioner argues that assertion that the indirect selling production adjustment is a reasonable we included packing costs in the cost of expenses which were deducted from and accurate method of adjusting the production (‘‘COP)’’ in our CEP profit U.S. price included an allocated amount transfer prices for the affiliated rate calculation, the support petitioner for common G&A expenses. For the final suppliers that did not report their cost offers in its argument documents our determination, we adjusted the MLP of production. Further, petitioner asserts inclusion of packing costs in COP in our G&A rate to exclude those indirect that the Department would have been home market profit calculation rather selling expenses and we excluded G&A justified in applying adverse facts than our CEP profit calculation. expenses from the indirect selling available by applying the highest cost of Petitioner is incorrect in its assertion expenses that were deducted from U.S. production adjustment available on the that we included packing costs in the price. record. COP in our preliminary CEP profit rate Comment 18 G&A Expenses as a DOC Position: We disagree with MHI calculation. Portion of Total Further-Manufacturing that the Department’s affiliated supplier Comment 16 SG&A as Applied to Costs: According to MHI, the Act states input cost adjustment constituted use of Further Manufacturing for Guard: MHI that the starting price used to establish facts available. The Department argues that the Department erroneously CEP shall be reduced by the amount of computed weighted-average loss included selling expenses in its G&A any expenses and profit associated with percentages for inputs acquired from a expense ratio for the sale to Guard. MHI economic activity in the United States. sample of affiliated suppliers based on states that MLP did not participate in MHI claims that the Department should the transfer prices and cost of the sale to Guard and that, since the not include G&A expenses incurred by production data submitted by MHI. The Department’s stated intention was to MHI in Japan in the CEP, as these use of this sample, we believe, reduced allocate only MLP’s G&A expenses to expenses are not U.S. economic activity, the burden on MHI. We applied the the cost of auxiliary parts and but instead pertain solely to activities of weighted-average loss percentages installation activities, the Department’s MHI’s corporate administrative staff. resulting from our sample to the total of inclusion of selling expenses is The petitioner maintains that section affiliated supplier transfer prices as incorrect. 772(d)(2) of the Act does not state that reported by MHI. MHI submitted no DOC Position: We agree with MHI that only costs physically incurred in the evidence to support their assertion that the Department inadvertently included United States are deductible from the the amounts reported to the Department selling expenses in its allocation of CEP. The petitioner states that the as ‘‘Affiliated Purchases’’ (which MLP’s G&A expenses to the costs of statute says the Department shall reduce represents the base to which our auxiliary parts and installation CEP by the cost of any further affiliated party adjustment was applied) activities. In one of MHI’s submissions manufacturing or assembly including includes the company’s purchases from it reported an MLP ‘‘G&A Rate’’ which additional material and labor. The either of the two suppliers in question. the Department assumed was based petitioner contends that ‘‘the Comment 15 Calculation of CV solely on G&A expenses and included Department allocates a proportion of Profit: MHI states that the Department no selling expenses. At verification, we total corporate overhead, including G&A failed to include freight costs in the total learned that this rate included indirect and interest expenses, to U.S. further costs deducted from contract prices in selling expenses. For the final manufacturing because U.S. activities its home market profit calculation. MHI determination, we adjusted the MLP derive significant benefit from parent maintains that by failing to subtract G&A rate to exclude those indirect corporate operations and oversight.’’ freight costs from home market prices to selling expenses. Petitioner also observes that MHI’s G&A measure CV profit, the Department Comment 17 SG&A as Applied to rate was computed based on its overstated the CV profit rate. Further Manufacturing for Piedmont: consolidated financial statements, MHI also claims that the Department For the sale to Piedmont, MHI states which include the further failed to reduce home market prices by that the Department double-counted a manufacturing costs. Therefore, the costs incurred to pack the portion of MLP’s SG&A expenses. MHI petitioner concludes that the MHI G&A merchandise. MHI contends that under maintains that since the Department rate should be applied to the further the approach taken by the Department, deducted from U.S. price indirect manufacturing costs. CEP profit calculations should include a selling expenses which included an DOC Position: The Department agrees deduction from gross contract prices of allocated amount for common G&A with petitioner that the MHI G&A rate the total expenses incurred in selling expenses based on sales value, all SG&A should be applied to the further the foreign like product in Japan, expenses attributable to the sale were manufacturing costs. As indicated by including packing expenses. fully allocated and deducted. Thus, MHI petitioner, MHI’s G&A rate was The petitioner argues that the argues, the Department should not calculated based upon consolidated Department did subtract packing costs allocate MLP SG&A expenses to CGS , which included further in determining the CEP profit. The auxiliary parts and installation, manufacturing costs. Therefore, in order petitioner argues that the packing was effectively allocating the same portion to be mathematically consistent, MHI’s included in the cost of production. The of MLP’s indirect expenses to the consolidated G&A rate should be petitioner suggests that if the Piedmont sale twice. applied to the further manufacturing Department decides to deduct packing DOC Position: We agree with MHI that costs. from home market prices, then it should the Department inadvertently included Comment 19 U.S. Credit Expenses: recalculate home market production indirect selling expenses in its MHI argues that the Department double- costs to exclude packing. allocation of MLP’s G&A expenses to the counted a portion of MHI’s interest DOC Position: We agree with MHI. We costs of auxiliary parts and installation expenses associated with further- recalculated the home market profit rate activities. The explanation for the manufacturing activities. MHI maintains applied in our CV calculation to reflect inclusion of the selling expenses in the that the Department allocated actual the deduction of freight costs from home G&A allocation is addressed in the interest expense to MHI’s further market sales prices. We also immediately preceding comment manufacturing expenses and then recalculated the CEP profit rate to reflect regarding the same issue applied to the imputed interest on not only the same the deduction of home market packing Guard sale. MHI is also correct in their further manufacturing expenses but also Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38165 on the actual interest expense. MHI expenses should be excluded because MHI is mistaken in its contention that maintains that if the Department they are not production costs and are we excluded SG&A expenses from our continues to consider installation a recognized in the year in which they home market credit calculations. further-manufacturing activity and to were incurred. MHI also argues that Appendix Q of the proprietary version calculate an imputed credit associated since the Department’s decision to of our preliminary determination memo with such further-manufacturing compute credit expenses based on of February 23, 1996 clearly indicates activity, then it should not also allocate production costs was based on the that in our imputed interest calculations an amount for MHI’s actual interest requirement in this industry for we adjusted production costs to reflect expense to these same activities. substantial capital expenditures over an an adjusted ‘‘total cost’’ (which includes The petitioner argues that MHI extended period of time, SG&A SG&A). confuses the actual corporate financing expenses should not be included, as Comment 21 Research & costs associated with LNPP operations they are not capital expenditures and Development Costs: MHI argues that no with imputed credit costs. The are expensed in the year in which they adjustment for its reported research and petitioner asserts that imputed credit were incurred. development (‘‘R&D’’) expenses is expenses should be included with the The petitioner argues that the warranted. MHI maintains that it actual financing expenses in the Department should include SG&A in its reported these costs in the same manner unadjusted CV because any potential imputed credit calculation and in which they are normally calculated double counting is eliminated in the maintains that the Department applied in its job cost system. MHI maintains circumstance of sale adjustment for the the same methodology to both U.S. and that since its normal business practice is imputed credit. Further, the petitioner home market imputed credit costs. The to calculate R&D costs on a product- argues that because the Department petitioner alleges that MHI is confusing specific basis and to allocate such costs constructs a value for the product as manufacturing costs with production to specific sales based on sales value, it imported into the U.S., rather than the costs. The petitioner concludes that the was correct for MHI to report the costs further manufactured product, the Department’s statement in the to the Department as calculated on that Department correctly deducted all preliminary determination that it has same basis. DOC Position: Although MHI further-manufacturing costs (including calculated imputed credit on production allocated R&D costs using its normal financing expenses) in determining the costs is in fact reflected in the sales-value accounting methodology, the CEP in order to ensure an apples-to- methodology evident in the calculations Department considers such an apples comparison. themselves, since the antidumping term DOC Position: The Department allocation inappropriate in an ‘‘cost of production’’ includes selling, stresses once again that the regular antidumping proceeding. Where there is general, and administrative costs. The interest expense allocation and the an allegation that a product is being imputed interest adjustments have petitioner maintains that the exported and sold at unfair prices (as different purposes and require Department’s inclusion of these costs compared to prices in the exporter’s independent analyses. See Japan reflects the fact that, just like material, home market), we generally consider it ‘‘Common Issues’’ comment 8. MHI is labor, and factory overhead, SG&A inappropriate to allocate costs incurred incorrect in its assertion that by expenses are incurred and must be paid for manufacturing operations based deducting both interest and imputed over the lengthy period between the upon those same prices. Therefore, we credit in our CEP calculation we have receipt of the first installment payments reallocated MHI’s R&D costs to all LNPP double counted the further and the receipt of final payment. contracts based on the relative manufacturing interest expense. The Accordingly, the petitioner states that, manufacturing costs incurred for each regular interest expense charged to since, on the revenue side of the contract. further manufacturing represents a equation, the imputed credit formula Continuation of Suspension of legitimate LNPP production cost. The captures the whole price of the press Liquidation imputed credit adjustment should be (i.e., total production costs plus profit), applied to the full production cost of the the methodology should include all In accordance with section LNPP, including the regular interest production costs on the expense side of 735(c)(1)(B) of the Act, we are directing expense. See MHI comment number 20. the equation. the Customs Service to continue to It is appropriate to impute interest on all DOC Position: We agree with suspend liquidation of all entries of production costs expected to be petitioner that SG&A expenses should LNPPs from Japan, as defined in the recovered upon sale of the LNPP. be charged with imputed credit costs. ‘‘Scope of Investigation’’ section of this Therefore, the Department imputed As petitioner states, it is the total cost notice, that are entered, or withdrawn interest on all the further manufacturing of production rather than manufacturing from warehouse for consumption, on or costs, including the actual interest costs that should be assessed with after March 1, 1996, the date of expense. imputed credit. Because SG&A publication of our preliminary Comment 20 SG&A Applied and expenses, by definition, are included in determination in the Federal Register. U.S. Credit Expenses: MHI claims that COP, and because the purpose of the Furthermore, we are also directing the the Department should not have imputed credit adjustment is to reflect U.S. Customs Service to continue to allocated SG&A expenses to MHI’s U.S. the interest cost associated with the suspend liquidation of all entries of credit expense adjustment. According to production costs incurred and the elements (parts or subcomponents) of MHI, the Department’s preliminary progress payments received during the components imported to fulfill a determination stated that its intention production phase of the LNPP, it is contract for a LNPP system, addition or was to compute credit on MHI’s appropriate to include SG&A expenses component, from Japan, that are production activity alone, not on SG&A in the imputed credit calculations. entered, or withdrawn from warehouse activities. Furthermore, MHI maintains Further, as also stated by petitioner, on or after March 1, 1996. Such that the Department did not calculate because the revenue side of our suspension of liquidation will remain in MHI’s Japan market credit expense calculation captures the entire LNPP effect provided that the sum of such adjustment based on production plus price, the cost side of the calculation entries represent at least 50 percent of SG&A. According to MHI, SG&A should capture all production costs. the value, measured in terms of the cost 38166 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices of manufacture, of the subject Exporter/ Weighted-average the provisions effective January 1, 1995, component of which they are part. This manufacturer margin percentage the effective date of the amendments determination will be made by the made to the Tariff Act of 1930 (‘‘the Department only after all entries of the Tokyo Kikai Act’’) by the Uruguay Rounds elements imported pursuant to a LNPP Seisakusho, Ltd ..... 56.28 Agreements Act (‘‘URAA’’). All Others ...... 58.97 contract are made and the finished Final Determination product pursuant to the LNPP contract The all others rate applies to all is produced. We determine that large newspaper entries of subject merchandise except printing presses and components For this determination, all foreign for entries of merchandise produced by thereof (‘‘LNPPs’’) from Germany are producers/exporters and U.S. importers the respondents listed above. in the LNPP industry be required to being, or are likely to be, sold in the provide clearly the following ITC Notification United States at less than fair value information on the documentation In accordance with section 735(d) of (‘‘LTFV’’), as provided in section 735 of accompanying each entry from Japan of the Act, we have notified the ITC of our the Act. elements pursuant to a LNPP contract: determination. As our final Case History (1) The identification of each of the determination is affirmative, the ITC Since the publication of the elements included in the entry, (2) a will determine, within 45 days, whether preliminary determination of sales at description of each of the elements, (3) these imports are causing material LTFV (60 FR 8035, March 1, 1996), the the name of the LNPP component of injury, or threat of material injury, to an which each of the elements are part, and industry in the United States. If the ITC following events have occurred: On February 27, 1996, the Department (4) the LNPP contract number pursuant determines that material injury, or disclosed to the petitioner (Rockwell to which the elements are imported. The threat of material injury, does not exist, Graphics, Inc. ) and the respondents suspension of liquidation will remain in the proceeding will be terminated and (MAN Roland Druckmaschinen AG effect until such time as all of the all securities posted will be refunded or (‘‘MRD’’) and Koenig Bauer-Albert AG requisite information is presented to canceled. If the ITC determines that (‘‘KBA’’)) the calculation methodologies U.S. Customs and the Department is such injury does exist, the Department used in the preliminary determination. able to make a determination as to will issue an antidumping duty order whether the imported elements are at directing Customs officials to assess On March 4 and 5, 1996, the petitioner least 50 percent of the cost of antidumping duties on all imports of the and MRD, respectively, alleged that the manufacture of the LNPP component of subject merchandise entered, or Department made certain ministerial which they are part. withdrawn from warehouse, for errors in its preliminary calculations. With respect to entries of LNPP spare consumption on or after the effective On March 15, 1996, the Department and replacement parts, and used date of the suspension of liquidation. determined that none of the allegations presses, from Japan, which are expressly This determination is published constituted ministerial errors. See excluded from the scope of the pursuant to section 735(d) of the Act. March 15, 1996, Memorandum from the Team to Richard W. Moreland Re: investigation, we will instruct the Dated: July 15, 1996. Customs Service to continue not to Alleged Ministerial Errors in the Robert S. LaRussa, Calculation of the Preliminary suspend liquidation of these entries if Acting Assistant Secretary for Import they are separately identified and Antidumping Duty Margin for MAN Administration. Roland Druckmaschinen AG. valued in the LNPP contract pursuant to [FR Doc. 96–18541 Filed 7–22–96; 8:45 am] which they are imported. On March 4 and 6, 1996, the BILLING CODE 3510±DS±P In addition, in order to ensure that Department issued supplemental cost our suspension of liquidation and sales questionnaires to MRD and its instructions are not so broad as to cover [A±428±821] U.S. subsidiary MAN Roland Inc. merchandise imported for non-subject (‘‘MRU’’). MRD submitted responses to uses, foreign producers/exporters and Notice of Final Determination of Sales these questionnaires on March 13, 1996. On March 7, 1996, we met with U.S. importers in the LNPP industry at Less Than Fair Value: Large members of the German Ministry of shall continue to be required to provide Newspaper Printing Presses and Economics to discuss the status of the certification that the imported Components Thereof, Whether proceeding. merchandise would not be used to Assembled or Unassembled, From Germany On March 14, 1996, the Department fulfill a LNPP contract. As indicated returned the updated cost information above, we will also continue to request AGENCY: Import Administration, submitted by MRD in its March 13, that these parties register with the International Trade Administration, 1996, submission which was Customs Service the LNPP contract Department of Commerce. determined to be untimely. numbers pursuant to which subject EFFECTIVE DATE: July 23, 1996. In March and April 1996, we merchandise is imported. FOR FURTHER INFORMATION CONTACT: V. conducted verification of the cost and The Customs Service shall require a Irene Darzenta or William Crow, AD/ sales questionnaire responses of MRD in cash deposit or posting of a bond equal CVD Enforcement, Import Germany and the United States. On to the estimated amount by which the Administration, International Trade April 3 and 25, 1996, MRD submitted normal value exceeds the export price, Administration, U.S. Department of the corrections to its response that were as shown below. Commerce, 14th Street and Constitution presented at verification. On May 14 The weighted-average dumping Avenue, N.W., Washington, D.C. 20230; and 16, 1996, the Department issued its margin is as follows: Telephone: (202) 482–6320 or (202) reports on verification findings. On May 8, 1996, the Department Exporter/ Weighted-average 482–0116, respectively. manufacturer margin percentage received comments it solicited from The Applicable Statute interested parties in its preliminary Mitsubishi Heavy In- Unless otherwise indicated, all determination regarding scope issues. dustries, Ltd ...... 62.96 citations to the statute are references to KBA refiled its scope comments on May Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38167

17, 1996, pursuant to the Department’s relied upon in calculating the estimated investigations includes the five press request to exclude new information margin. On the basis of those system components. They are: determined to be filed untimely. modifications, the Department (1) a printing unit, which is any The petitioner and the respondents recalculated the estimated dumping component that prints in monocolor, submitted case briefs on June 3, 1996, margin and found it to be 46.40 percent. spot color and/or process (full) color; and rebuttal briefs on June 10, 1996. On The Department corroborated all of the (2) a reel tension paster (‘‘RTP’’), June 11, 1996, the Department requested secondary information from which the which is any component that feeds a that MRD revise its case brief to exclude margin was calculated during our pre- roll of paper more than two newspaper untimely new factual information. MRD initiation analysis of the petition, to the broadsheet pages in width into a subject submitted revised briefs on June 13, extent appropriate information was printing unit; 1996. The Department held a public available for this purpose at that time. (3) a folder, which is a module or hearing for this investigation on June 17, For purposes of the preliminary combination of modules capable of 1996. determination, the Department re- cutting, folding, and/or delivering the paper from a roll or rolls of newspaper Facts Available examined the price information provided in the petition in light of broadsheet paper more than two pages KBA failed to respond to the information developed during the in width into a newspaper format; Department’s questionnaire. Section investigation, and found that it (4) conveyance and access apparatus 776(a)(2) of the Act provides that if an continued to be of probative value. For capable of manipulating a roll of paper more than two newspaper broadsheet interested party (1) withholds purposes of the final determination, we pages across through the production information that has been requested by compared the petition price information process and which provides structural the Department, (2) fails to provide such against verified data, and again found support and access; and information in a timely manner or in the that it continued to be of probative form or manner requested, (3) (5) a computerized control system, value. See Comment 1 of the ‘‘Company- significantly impedes a determination which is any computer equipment and/ Specific’’ subsection of the ‘‘Interested under the antidumping statute, or (4) or software designed specifically to Party Comments’’ section of this notice. provides such information but the control, monitor, adjust, and coordinate information cannot be verified, the Scope of Investigation the functions and operations of large Department shall use facts otherwise newspaper printing presses or press Note: The following scope language reflects available in reaching the applicable certain modifications from the notice of the components. determination. Because KBA failed to preliminary determination. As specified A press addition is comprised of a respond to the Department’s below, we have clarified the scope to include union of one or more of the press questionnaire, we must use facts incomplete LNPP systems, additions and components defined above and the otherwise available with regard to KBA. components. We have also clarified the scope equipment necessary to integrate such Section 776(b) provides that adverse to include ‘‘elements’’ (otherwise referred to components into an existing press inferences may be used against a party as ‘‘parts’’ or ‘‘subcomponents’’) of a LNPP system. that has failed to cooperate by not acting system, addition or component, which taken Because of their size, large newspaper to the best of its ability to comply with altogether, constitute at least 50 percent of printing press systems, press additions, requests for information. See also the cost of manufacture of the LNPP and press components are typically Statement of Administrative Action component of which they are a part. We have shipped either partially assembled or also excluded from the definition of the five (‘‘SAA’’), at 870. KBA’s failure to reply subject LNPP components any reference to unassembled, complete or incomplete, to the Department’s questionnaire specific subcomponents (i.e., the reference to and are assembled and/or completed demonstrates that KBA has failed to a printing-unit cylinder in the definition of prior to and/or during the installation cooperate to the best of its ability in this a LNPP printing unit). In addition, we have process in the United States. Any of the investigation. Thus, the Department has excluded the following Harmonized Tariff five components, or collection of determined that, in selecting among the System of the United States (‘‘HTSUS’’) components, the use of which is to facts otherwise available to KBA, an subheadings from the scope: 8524.51.30, fulfill a contract for large newspaper adverse inference is warranted. As facts 8524.52.20, 8524.53.20, 8524.91.00, and printing press systems, press additions, otherwise available, we are assigning to 8524.99.00. See ‘‘Scope Comments’’ section or press components, regardless of of this notice and the July 15, 1996 Decision KBA the margin stated in the notice of Memorandum to Barbara Stafford from The degree of assembly and/or degree of initiation, 46.40 percent. Team Re: Scope Issues in the Final combination with non-subject elements Section 776(c) provides that when the Determinations. before or after importation, is included Department relies on secondary in the scope of this investigation. Also information (such as the petition) in Scope: The products covered by these included in the scope are elements of a using the facts otherwise available it investigations are largenewspaper LNPP system, addition or component, must, to the extent practicable, printing presses, including press which taken altogether, constitute at corroborate that information from systems, press additions and press least 50 percent of the cost of independent sources that are reasonably components, whether assembled or manufacture of any of the five major at its disposal. When analyzing the unassembled, whether complete or LNPP components of which they are a petition, the Department reviewed all of incomplete, that are capable of printing part. the data the petitioner relied upon in or otherwise manipulating a roll of For purposes of this investigation, the calculating the estimated dumping paper more than two pages across. A following definitions apply irrespective margin. This estimated dumping margin page is defined as a newspaper of any different definition that may be was based on a comparison of the bid broadsheet page in which the lines of found in Customs rulings, U.S. Customs price for a sale of a LNPP system made type are printed perpendicular to the law or the HTSUS: the term by MRD to an unrelated U.S. customer running of the direction of the paper or ‘‘unassembled’’ means fully or partially and the constructed value (‘‘CV’’) of that a newspaper tabloid page with lines of unassembled or disassembled; and (2) LNPP system. As a result of that type parallel to the running of the the term ‘‘incomplete’’ means lacking analysis, the Department modified the direction of the paper. In addition to one or more elements with which the CV methodology that the petitioner press systems, the scope of these LNPP is intended to be equipped in 38168 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices order to fulfill a contract for a LNPP Scope Issues in the Final investigations? This question was system, addition or component. Determinations. particularly difficult to answer in light This scope does not cover spare or of the complex nature of the importation 1. Elements of LNPPs replacement parts. Spare or replacement of LNPPs—i.e., the high degree of parts imported pursuant to a LNPP As stated in the ‘‘Scope of disassembly and/or incompleteness and contract, which are not integral to the Investigation’’ section above, the scope the multiple shipments of parts and original start-up and operation of the of the LNPPs investigations covers subcomponents in various combinations LNPP, and are separately identified and LNPP systems, additions and the five over an extended period of time. valued in a LNPP contract, whether or major press system components, Therefore, we had to decide on a not shipped in combination with whether assembled or unassembled, that reasonable and practical approach in covered merchandise, are excluded from are capable of printing or otherwise determining what constitutes a subject the scope of this investigation. Used manipulating a roll of paper more than LNPP component, addition or system, presses are also not subject to this two pages across. Because of their large and in so doing, establish the basis on scope. Used presses are those that have size, LNPPs are typically imported into which we will include elements in the been previously sold in an arm’s length the United States in either partially scope. transaction to a purchaser that used assembled or disassembled form, in We considered primarily two them to produce newspapers in the multiple shipments over an extended alternative approaches for analyzing ordinary course of business. period of time, and may require the what governs the inclusion of parts or Further, this investigation covers all addition and integration of non-subject subcomponents within the scope of current and future printing technologies elements prior to or during the these investigations (other than spare or capable of printing newspapers, installation process in the United States. replacement parts which are expressly including, but not limited to, Consequently, we stated in our notice of excluded from the scope if they are lithographic (offset or direct), initiation that ‘‘any of the five separately identified and valued in a flexographic, and letterpress systems. components, or collection of LNPP contract), and solicited comments The products covered by this components, the use of which is to from interested parties on the merits of investigation are imported into the fulfill a contract for an LNPP system, these approaches. One approach United States under subheadings addition, or component, regardless of considers, on a case-by-case basis, 8443.11.10, 8443.11.50, 8443.30.00, degree of disassembly and/or degree of whether the imported parts or 8443.59.50, 8443.60.00, and 8443.90.50 combination with non-subject elements subcomponents when taken together are of the HTSUS. Large newspaper printing before or after importation, is included essentially a LNPP system, addition or presses may also enter under HTSUS in the scope of [these] investigation[s].’’ component. This so-called ‘‘essence’’ subheadings 8443.21.00 and 8443.40.00. The interpretation of the intent of this approach focuses on the question of Large newspaper printing press language in the scope resulted in which parts are most critical to the computerized control systems may enter significant controversy among the operation of the subject merchandise so under HTSUS subheadings 8471.49.10, interested parties in these that when taken together they constitute 8471.49.21, 8471.49.26, 8471.50.40, investigations. Generally, the petitioner an essentially complete LNPP 8471.50.80, and 8537.10.90. Although has interpreted it to mean that component, addition or system. A the HTSUS subheadings are provided incomplete components and their second approach considers the value of for convenience and Customs purposes, constituent elements from a subject the imported parts or subcomponents our written description of the scope of country are covered within the scope. relative to the total value of the finished this investigation is dispositive. The respondents have generally LNPP component, addition or system in interpreted our initiation scope Scope Comments the United States. That is, we would language to include only complete determine that the imported parts or The petitioner and the respondents in components, arguing that the inclusion subcomponents would be within the this investigation and the concurrent of incomplete merchandise in the scope scope if they comprised a certain investigation of LNPPs from Japan would necessarily precipitate the minimum percentage of the value of the submitted comments in their case and inclusion of elements which would parts or subcomponents of a finished rebuttal briefs on several scope-related conflict with the Department’s industry LNPP system, addition or component. issues. These scope issues pertain to: (1) support determination. This value would be measured in terms the treatment of elements (parts or To clarify the issue, in our of the cost of manufacture, rather than subcomponents) of LNPPs; (2) the use of preliminary determinations, we stated price, because (1) we are primarily the ‘‘to fulfill a contract’’ language; (3) that we interpreted the current scope to concerned with where the actual the inclusion of HTSUS subheading ‘‘include those elements or collection of manufacturing is occurring and not the 8524 which encompasses magnetic elements imported from a subject market value, and (2) the imported tapes; and (4) the treatment of imported country insofar as they constitute any elements are not normally priced merchandise of U.S. origin. Although one of the five covered components separately from the LNPP which they certain issues were raised by the parties which are, in turn, used to fulfill a comprise in the ordinary course of within the context of either the German contract for a LNPP press system, press business. or Japanese investigation, we have addition or press component.’’ We also In general, the interested party consolidated them for purposes of the stated that ‘‘individual parts per se are comments received on this issue reflect final determinations because the not covered by the scope of these widely diverging views. The basis of the resolution of these issues impacts the investigations unless taken as a whole controversy among the parties centers scope of both investigations. Each of they constitute a subject component on the interpretation of the following these issues, the interested parties’ used to fulfill an LNPP contract.’’ This excerpts from the current scope comments and the Department’s interpretation, however, raised the language: (1) ‘‘regardless of degree of position are summarized below. For the question: at what point do the elements disassembly and/or degree of complete discussion and analysis, see imported from a subject country rise to combination with non-subject elements the July 15, 1996 Memorandum to the level of a LNPP component, addition before or after importation;’’ and (2) Barbara Stafford from The Team Re: or system subject to the scope of these ‘‘individual elements when taken as a Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38169 whole constitute a subject component.’’ we believe that clarification of the scope example, that a side frame or a blanket The petitioner views this language as is warranted in this case. We note that cylinder is the ‘‘essence’’ of a printing necessarily referring to both complete the Department has the authority to unit, as suggested by the petitioner. and incomplete components given the clarify the scope language at any time Added to the difficulty of accepting nature of the imported merchandise, during an investigation. See Final the petitioner’s ‘‘essence’’ proposition in and proposes that the Department Determination of Sales at Less Than general is the fact that many of the clarify the scope to include incomplete Fair Value: Small Diameter Seamless critical elements identified by the merchandise from a subject country Carbon and Alloy Standard, Line and petitioner individually represent an insofar as it includes any one of 16 key Pressure Pipe from Italy, 60 FR 31981, insignificant portion of the total value of elements, which it defines to be critical 31984, 31987 (June 19, 1995); Minebea the LNPP component of which they are to the functioning of a LNPP. KBA and Co., Ltd. v. United States, 782 F. Supp. part, and the identification of named the respondents in the Japan 117, 120 (CIT 1992); and Kern-Liebers elements may require modification over investigation, Mitsubishi Heavy USA v. United States, 881 F. Supp. 618 time due to technological advances. Industries, Ltd. (‘‘MHI’’) and Tokyo (CIT 1995). Furthermore, there is the unresolved Kikai Seisakusho, Ltd. (‘‘TKS’’), view The parties’ diverging views on the question of whether a critical element the scope language as referring to approach the Department should pursue would constitute the ‘‘essence’’ of a complete merchandise. Alternatively, in resolving the issue attests to the fact subject component if it itself were KBA argues for a value test whereby that there is no perfect solution to the incomplete in some minor way. In other imported elements would be covered if problem. The selection of one or the words, the problem faced in this case is their value exceeded at least 60 percent other approach for purposes of the final qualitatively unlike the problems faced of the value (or 50 percent of the cost) determinations, however, is in the other cases, cited above, where it of the finished system (or at least 90 unavoidable if our scope is to have was possible to reduce the ‘‘essence’’ percent of the value of any individual reasonable clarity and administrability, definition to a single, non-contradictory LNPP component), while MHI advances given the complexity of the importation definition. arguments for an essence approach that of the subject merchandise and the Therefore, if no single element can be would be predicated upon the potential for circumvention. The pursuit identified as the ‘‘essence’’ of a importation of all elements which it of either approach necessitates particular LNPP component, and if defines to be critical to the functioning clarification of the scope to include requiring that all of the ‘‘essential’’ of a LNPP. MRD generally supports an explicitly incomplete Japanese- or elements listed by the petitioner or essence approach assessed on a case-by- German-origin LNPPs. Given that the other parties be of subject country origin case basis but favors maintaining minimum level of scope coverage is any would unacceptably limit the intended scope of these investigations, then the flexibility on the issue, while TKS offers of the five LNPP components, both the ‘‘essence’’ approach is unworkable. no option, arguing that both approaches essence and value approaches must be examined on a component-specific We believe that the value approach is would result in the unlawful expansion consistent, predictable, and of the scope to include parts and basis. The essence approach has superficial administrable. According to this subcomponents. appeal because it seeks, in principle, to approach, imported elements are We agree with the petitioner that capture what a particular subject LNPP covered if they constitute a certain incomplete merchandise by necessity component actually is—i.e., the ‘‘heart’’ minimum percentage of the value, based must be included in the scope of these of it. However, the information obtained on the cost of manufacture, of the investigations. Given the very large size from the interested parties and other particular component of which they are of LNPPs and the complex importation sources make it difficult, if not a part. We acknowledge, however, that process, complicated by the further impossible, to state that a particular in order to perform the value test, we manufacturing and/or installation element is the ‘‘essence’’ of a LNPP will have to wait until after all of the activities performed in the United States component. In past cases in which the elements comprising the LNPP by the respondents, it was the number of parts and subcomponents component are imported and the LNPP Department’s intent to use the language comprising the subject merchandise was component is produced, and that we at issue to avoid creating loopholes for limited, we have identified specific will suspend liquidation on all circumvention, including those arising elements, or groups of elements, as imported elements in the meantime. In from differing degrees of completeness constituting the ‘‘whole’’ or ‘‘essence’’ addition, the argument has been made of the imported merchandise. The of the subject merchandise. See e.g., that the value approach is more Department is concerned that, because Final Determination of Sales at Less uncertain with respect to duty of the great number of parts involved, Than Fair Value: Bicycles from the assessment, as all shipments would there is the potential that a party may People’s Republic of China, 61 FR 19026 need to be completed before the value attempt to exclude its merchandise from (April 30, 1996); Final Determination of test on a finished product basis would the scope of these investigations on the Sales at Less Than Fair Value: be assessed. However, we note that this basis of a lack of completion. From the Professional Electric Cutting Tools and would also be true if we took the Department’s standpoint, it is not (and Professional Electric Sanding/Grinding ‘‘essence’’ approach, in that the never has been) the individual elements Tools from Japan, 58 FR 30144 (May 26, identification of critical elements could per se that are the issue, but the 1993); and Final Determination of Sales only take place after all importations combination of these elements that at Less Than Fair Value: Gene have been made. would rise to the level of covered Amplification Thermal Cyclers and Furthermore, we have instituted the merchandise whether by essence or by Subassemblies Thereof, from the United concept of a value test in the past where value (i.e., the sum of importations Kingdom, 56 FR 32172 (July 15, 1991). the nature of the merchandise and its pursuant to a LNPP contract, not the In this case, however, given the large importation lent itself to circumvention. individual importations or parts number of parts and subcomponents See Final Determination at Sales at Less themselves). Given the significant which are combined to produce a Than Fair Value: Cellular Mobile controversy that has been generated subject LNPP component, we believe Telephones and Subassemblies from over the scope of these investigations, that it is impossible to conclude, for Japan, 50 FR 45447, 45448 (October 31, 38170 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

1985); and Mitsubishi Elec. Corp. v. suspend liquidation on all entries of facilitating the identification of the United States, 898 F.2d. 1577, 1582 elements of LNPP components imported subject merchandise for the assessment (Fed. Cir. 1990). to fulfill a contract for a LNPP system, of duties arising from an antidumping In this case, exercising our discretion addition or component, in order to order. As such, a contract is similar to to develop an administrable scope, we assess the cost of manufacture of these customs entry forms and company determine that if the sum of the value imports relative to the cost of invoices commonly used in the process of elements imported to fulfill a LNPP manufacture of the finished component of liquidating foreign products entering contract is at least 50 percent of the of which they are part. The 50 percent the customs territory of the United value, measured in terms of the cost of value test will be administered by the States. Therefore, we disagree with manufacture, of any of the five named Department after all entries of such MHI’s contention that the Department components covered by the scope into merchandise have been made and the would be replacing products with which they are incorporated, then the component of which they are part is contracts as the object of the imported elements are covered by the produced. investigation. scope. An individual component is To facilitate the Department’s Given the complex nature of the covered by the scope if the imported performance of the value test, all foreign importation of the product (i.e., a high elements comprising it represent at least producers/exporters and U.S. importers degree of disassembly/incompleteness, 50 percent of the value of the in the LNPP industry shall be required and multiple shipments of innumerable component, even if the contract to provide clearly the following parts and subcomponents over an pursuant to which the elements are information on the documentation extended period of time), the reference imported is for an entire LNPP system accompanying each entry from Germany to a LNPP contract in this context is the and the remaining components are not and Japan of elements pursuant to a only administrable means of identifying within the scope. LNPP contract: (1) the identification of the subject merchandise. Therefore, we We believe that this 50 percent each of the elements included in the have continued using the ‘‘to fulfill a threshold is a workable standard and is entry, (2) a description of each of the contract’’ language in the scope and in sufficiently significant to capture certain elements, (3) the name of the LNPP our continuation of suspension of critical elements as well. We also component of which each of the liquidation instructions to the Customs believe that pursuing the value test on elements are part, (4) the LNPP contract Service. the basis of cost of manufacture, rather number pursuant to which the elements 3. HTSUS Subheading 8524 than price, is less susceptible to are imported. The suspension of manipulation and more readily liquidation will remain in effect until MHI maintains that the Department traceable to company records because such time as all of the requisite should amend the scope of these the imported elements are normally not information is presented to U.S. investigations to exclude those tariff priced separately from the LNPP which Customs and the Department is able to categories that encompass magnetic they comprise in the ordinary course of make a determination as to whether the tape—i.e., HTSUS numbers 8524.51.30, business. imported elements are at least 50 8524.52.20. 8524.53.20, 8524.91.00 and In addition, given our rejection of the percent of cost of manufacture of the 8524.99.00—because the subject essence approach for the purpose of the LNPP component of which they are merchandise does not include magnetic scope, we believe that including any part. tape. According to MHI, the only references to specific subcomponents of component covered by the scope that covered components (i.e., printing-unit 2. ‘‘To Fulfill A Contract’’ Language in could possibly include such a product, cylinder) in the definition of the five the Scope the computerized control system, covered components would be The current scope of these instead includes hard and floppy disks. improper. Therefore, we have excluded investigations ties subject merchandise MHI contends that if the Department them from the scope. to a contract for the sale of a LNPP includes the HTSUS classifications for Based on the foregoing analysis, we system, addition or component, and the either magnetic tape or other generic have clarified the scope to include issue has been raised by one respondent computer components, it will incomplete LNPP systems, additions or as to whether such provision is lawful. inappropriately interfere with the components. For the reasons explained Specifically, MHI argues that the ‘‘to liquidation of a multitude of computer- above, we note that this does not fulfill a contract’’ provision in the scope related products that are not relevant to constitute an ‘‘expansion’’ of the scope, definition incorrectly applies the the LNPP investigations. as the respondents allege, but merely a antidumping law and the assessment of HTSUS 8524 covers ‘‘records, tapes necessary clarification. antidumping duties to contracts instead and other recorded media for sound or For purposes of these investigations, of products, creates an unacceptable other similarly recorded phenomena, incomplete LNPPs will be defined as uncertainty as to the scope of products including matrices and meters for the any element or group of elements of a covered by these investigations, and production of records,’’ but excluding LNPP system, addition or component risks being overinclusive. The petitioner photographic or cinematographic goods. that are imported from a subject country argues that the Department has not The above-specified HTSUS numbers lacking one or more elements needed to applied the antidumping law to currently included in the scope refer to fulfill a contract for a LNPP system, contracts. It asserts that the language at ‘‘other magnetic tapes,’’ ‘‘other video addition or component. Such elements issue does not mean that the contract tape recordings’’ and ‘‘other recorded would be covered by the scope of these itself is the subject of the investigation, media for reproducing phenomena other investigations if they represent at least although it is an indispensable than sound or image.’’ HTSUS 8524 was 50 percent of the value, measured in consideration in the investigation included in the scope at the initiation terms of the cost of manufacture, of the because it determines the price. stage of these investigations, pursuant to finished component of which they are a We disagree with the respondent. A a conversation with the National Import part. Therefore, as stipulated in the contract is neither the object of our Specialist who, at that time, advised the ‘‘Continuation of Suspension of investigations, nor the object of the Department that the LNPP computerized Liquidation’’ section of this notice, we assessment of tariffs. Instead, a contract control system may enter the U.S. are instructing the Customs Service to is a documentary instrument for Customs territory under the HTSUS Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38171 subheading 8524. See July 20, 1995, HTSUS 9801 generally provides that the Matter of: Certain Corrosion- Memorandum to the File Re: Scope articles produced in and exported from Resistant Carbon Steel Products from Definition-Discussion with National the United States and subsequently Canada; USA–93–1904–03 (October 31, Import Specialist; and the February 15, returned to the United States, without 1994)). 1996, Memorandum to the File Re: having been advanced in value or In other words, if the U.S.-origin HTSUS Subheadings. improved in condition by any process of elements were combined with other Pursuant to further conversations manufacture or other means while elements prior to reimportation into the with the National Import Specialist for abroad, are exempt from duties. HTSUS United States to produce a subject LNPP the merchandise at issue, we learned 9802 generally provides that articles in accordance with the criteria set forth that imported software or media returned to the United States, after in Scope Comment 1 above, regardless of application is separately having been exported to be advanced in antidumping duties would be assessed identified in the HTSUS for Customs value or improved in condition by any on the full value of the import, inclusive valuation purposes, and that records, process of manufacture or other means, of the U.S. content. Therefore, based on tapes and other recorded media of are dutiable on the value of the the foregoing analysis, we have not heading 8524 remain classified under processing conducted outside of the clarified the scope in the manner that heading, whether or not they are United States. Articles returned to the suggested by KBA. entered with the apparatus for which United States that have not lost their Period of Investigation they are intended. Therefore, physical identity and have not theoretically, computer subcomponents undergone such advancement in value The POI for MRD is July 1, 1993 such as the software destined for use in or improvement in condition abroad, through June 30, 1995. See Preliminary a LNPP could be classified as ‘‘other except assembly and operations Determination of Sales at Less Than recorded media’’ under HTSUS 8524. incidental to that assembly, would be Fair Value: Large Newspaper Printing However, in practice, this classification subject to duties on the value of the Presses and Components Thereof, may not necessarily apply to LNPPs. We imported article less the cost or the Whether Assembled or Unassembled, note that there is no evidence on the value of the U.S. content. from Germany, 61 FR 8035, March 1, 1996) (‘‘LNPPs Preliminary record of these proceedings at the Therefore, under HTSUS 9801, the Determination’’). present time indicating that the software respondent’s proposition is valid if the of computerized control systems U.S.-origin elements are returned to the Product Comparisons imported to fulfill LNPP contracts is United States in the same manner as Although the home market was entered under the HTSUS subheading at they were exported from the United viable, in accordance with section 773 issue. States. Under HTSUS 9802, the issue is of the Act, we based NV on CV because Our practice in crafting the scope of less clear for antidumping purposes. we determined that the particular any investigation is to include language While U.S. Customs law provides for a market situation, which requires that that states that ‘‘[a]lthough the HTSUS partial exemption of duty for U.S.- the subject merchandise be built to each subheadings are provided for articles sent abroad for processing or customer’s specifications, does not convenience and Customs purposes, our assembly and returned to the United permit proper price-to-price written description of the scope . . . is States, the Department has concluded in comparisons. See LNPPs Preliminary dispositive.’’ This language means that the past that the general rule applicable Determination. it is the description of the merchandise, to ordinary customs duties is not and not its Customs classification, that controlling with respect to antidumping Fair Value Comparisons is controlling for the assessment of duties, and that the United States To determine whether MRD’s sales of antidumping duties. Therefore, Customs Service American Goods LNPPs to the United States were made notwithstanding the HTSUS numbers Returned (‘‘AGR’’) program, pursuant to at LTFV, we compared Constructed under which the software of a LNPP HTSUS 9802, is subject to the collection Export Price (‘‘CEP’’) to the NV, as computerized control system is of antidumping duties on the full value described in the ‘‘Constructed Export imported from Germany or Japan, it of the merchandise, including the U.S. Price’’ and ‘‘Normal Value’’ sections of would be covered if it met the criteria portion. The Department has stated that this notice. In accordance with section set forth in Scope Comment 1 above. any interpretation which sought to limit 777A(d)(1)(A)(ii), we calculated In this case, however, because we the application of antidumping duties transaction-specific CEPs (which in this have no evidence on the record to on AGR goods to the foreign content case were synonymous with model- indicate that computer control would be inconsistent with the specific CEPs) for comparison to subcomponents are imported under the Department’s statutory mandate to transaction-specific NVs. See LNPPs category at issue, we see no need to assess antidumping duties on the extent Preliminary Determination. continue to include the above-specified to which the normal value (‘‘NV’’) HTSUS numbers in the scope of these (previously referred to as ‘‘foreign Constructed Export Price investigations. market value’’) exceeds the export price MRD reported its sales as either CEP Therefore, we have excluded them (previously referred to as ‘‘United States or EP. We classified all of MRD’s sales from the scope of these investigations price’’). Application of antidumping as CEP sales because its affiliated U.S. for purposes of the final determinations. duties only on the foreign processing or sales agent acted as more than a content portion of the import might processor of sales-related 4. U.S.-Origin Goods Returned mean that the margin of dumping would documentation and a communication KBA requests clarification that U.S.- not be fully offset. See Final link with the unaffiliated U.S. origin elements and components would Determination of Sales at Less Than customers; and the U.S. affiliate engaged not be subject to antidumping duties if Fair Value: Certain Corrosion-Resistant in a broad range of activities including any are reimported, in accordance with Carbon Steel Products from Canada (58 installation support, which we have the HTSUS which provides that such FR 37099, July 9, 1993), as affirmed by classified as further manufacturing. See ‘‘U.S. goods returned’’ are not subject to the Binational Panel under the United Comment 2 and Comment 3 of the any duties. States-Canada Free Trade Agreement (In ‘‘Common Issues’’ subsection of the 38172 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

‘‘Interested Party Comments’’ section of market for all LNPP products based on verification procedures, including this notice. We calculated CEP, in the respondent’s representations at examination of relevant accounting and accordance with subsections 772 (b) and verification that MRD would be sales records and original source (d) of the Act, for those sales to the first primarily responsible for any warranty documents provided by the respondent. unaffiliated purchaser by a seller servicing necessary for these two sales. affiliated with the producer/exporter For Fargo and Global, warranty Currency Conversion that took place before importation and expenses were recalculated based on the Section 773A(a) of the Act directs the involved further manufacturing in the warranty expense factor reflecting Department to convert foreign United States. MRU’s historical experience, revised to currencies based on the dollar exchange We excluded MRD’s sale to The reflect verification findings, given the rate in effect on the date of sale of the Charlotte Observer (‘‘Charlotte’’) from respondent’s representations that MRU subject merchandise, except if it is our final analysis because it involved is primarily responsible for any established that a currency transaction the importation of parts and warranty servicing necessary for these subcomponents, the sum of the cost of two sales. See Comment 6 of the on forward markets is directly linked to manufacture of which was less than 50 ‘‘Company-Specific Issues’’ subsection an export sale. When a company percent of the cost of manufacture of the of the ‘‘Interested Party Comments’’ demonstrates that a sale on forward LNPP component of which they are a section of this notice. markets is directly linked to a particular part. See ‘‘Scope of Investigation’’ and (5) We added warehousing income export sale in order to minimize its ‘‘Scope Comments’’ sections of this accrued on one sale. exposure to exchange rate losses, the notice. See also Comment 2 of the Department will use the rate of ‘‘Company-Specific Issues’’ subsection Normal Value/Constructed Value exchange in the forward currency sale of the ‘‘Interested Party Comments’’ For the reasons outlined in the agreement. In this case, although MRD section of this notice. ‘‘Product Comparisons’’ section of this reported that forward currency We calculated CEP based on the same notice, we based NV on CV. exchange contracts applied to certain methodology used in the preliminary In accordance with section 773(e) of U.S. sales, we could not verify that these determination, with the following the Act, we calculated CV based on the contracts were directly linked to the exceptions: sum of the respondent’s materials and particular sales in question. See May 14, (1) Where appropriate, we revised/ fabrication costs, plus amounts for 1996 MRD Sales Verification Report at updated the respondent’s data in selling, general and administrative 37. Therefore, for the purpose of the accordance with verification findings. (‘‘SG&A’’) expenses and U.S. packing final determination, we made currency See May 14, 1996 Memoranda for David costs. We based our CV calculation on L. Binder from V. Irene Darzenta Re: the conversions into U.S. dollars based on the same methodology used in the the official exchange rates in effect on Verification of the Questionnaire preliminary determination, revised to the dates of the U.S. sales as certified by Responses of MAN Roland reflect verification findings, where the Federal Reserve Bank. Druckmaschinen AG and MAN Roland appropriate, with the following Inc. (‘‘MRD and MRU Sales Verification exceptions: Section 773A(a) directs the Reports.’’). (1) As facts available, we calculated Department to use a daily exchange rate (2) We excluded all post-POI price the cost of manufacturing for the sales in order to convert foreign currencies amendments. See Comment 3 of the to Rochester and Wilkes Barre based on into U.S. dollars, unless the daily rate ‘‘Company-Specific Issues’’ subsection the respondent’s submitted cost involves a ‘‘fluctuation.’’ For this final of the ‘‘Interested Party Comments’’ estimates, adjusted for the variance determination, we have determined that section of this notice. between estimated and actual costs for a fluctuation exists when the daily (3) We deducted from CEP those a completed sale of a similar Geoman exchange rate differs from the indirect selling expenses that were press. See Comment 9 of the ‘‘Company- benchmark rate by 2.25 percent. The associated with economic activity in the Specific Issues’’ subsection of the benchmark rate is defined as the rolling United States, whether incurred in the ‘‘Interested Party Comments’’ section of average of rates for the past 40 business United States or in Germany, and this notice. days. When we determined a fluctuation irrespective of where recorded, after (2) In calculating MRU’s further existed, we substituted the benchmark making certain adjustments. We manufacturing general and for the daily rate. Further, section recalculated those indirect selling administrative (‘‘G&A’’) rate, we divided 773A(b) directs the Department to allow expenses incurred by MRD in Germany POI G&A expenses by cost of sales in accordance with the methodology a 60-day adjustment period when a recognized during the POI, excluding currency has undergone a sustained explained in the DOC Position to the cost for parts purchased from MRD. Comment 1 of the ‘‘Common Issues’’ movement. A sustained movement has See Comment 14 of the ‘‘Company- occurred when the weekly average of subsection of the ‘‘Interested Party Specific Issues’’ subsection of the Comments’’ section of this notice. We actual daily rates exceeds the weekly ‘‘Interested Party Comments’’ section of average of benchmark rates by more recalculated those indirect selling this notice. expenses incurred by MRU in the than five percent for eight consecutive United States using the verified indirect Price to CV Comparisons weeks. (For an explanation of this selling expense rate for the POI based on For CEP to CV comparisons, we method, see, Policy Bulletin 96–1: sales revenues. See Comment 5 of the deducted from CV the weighted-average Currency Conversions, 61 FR 9434, ‘‘Company-Specific Issues’’ subsection home market direct selling expenses, March 8, 1996.). Such an adjustment of the ‘‘Interested Party Comments’’ pursuant to section 773(a)(8) of the Act. period is required only when a foreign section of this notice. currency is appreciating against the U.S. (4) For the Rochester and Wilkes Verification dollar. The use of an adjustment period Barre sales, we recalculated warranty As provided in section 782(i) of the was not warranted in this case because expenses using the verified warranty Act, we attempted to verify the the deutschemark did not undergo a expense factor applicable to MRD’s information submitted by the sustained movement, nor were there any historical experience in the home respondent. We used standard currency fluctuations during the POI. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38173

Interested Party Comments indirect costs associated with pre- moot. According to TKS, the contract design, bid preparation, cost Department has determined that the Common Issues in the German and estimation, and negotiations for U.S. language of the SAA which refers to Japanese LNPP Investigations sales, regardless of where such expenses ‘‘economic activity occurring in the The petitioner and the respondents in are originally incurred; and (3) all direct United States’’ is to be interpreted as this investigation and the concurrent and indirect selling expenses which activities of the respondent which investigation of LNPPs from Japan were originally incurred in the United physically occur in the United States. raised certain common issues in their States by either the U.S. affiliate or the TKS cites to the Final Determination of case and rebuttal briefs. Therefore, for foreign manufacturer, and have been Sales at Less Than Fair Value: Certain purposes of these final determinations, recorded in the accounts of the foreign Pasta from Italy, 61 FR 30326 (June 14, we have consolidated the common manufacturer. To the extent that a 1996) (‘‘Pasta Final Determination’’) and issues in this notice in order to respond respondent has not specifically the Preliminary Results of to them. identified which portions of its U.S. Administrative Review: Certain Steel Comment 1 Deduction of U.S. indirect selling expenses booked by the Wire Rod from France, 61 FR 8915, 8917 Indirect Selling Expenses from CEP: The foreign manufacturer are related to U.S. (March 6, 1996) to support its petitioner maintains that the economic activity, the Department contention that the petitioner’s stance is Department failed to deduct most of the should deduct all such expenses from inconsistent not only with the U.S. indirect selling expenses because CEP. instructions of the SAA but with recent they were recorded in the accounts of MRD disagrees. MRD argues that Department precedents. the foreign LNPP manufacturers. neither the statute nor the proposed MHI argues that the Department According to the petitioner, the regulations support the petitioner’s properly excluded from U.S. indirect Department should deduct all indirect proposition. MRD states that in selling expenses those costs incurred for selling expenses incurred on behalf of accordance with section 772(d) of the non-U.S. economic activity. MHI argues U.S. sales, irrespective of the location at Act and the Department’s proposed that the methodology adopted by the which the expenses are actually regulations, the deduction for indirect Department was consistent with the incurred or the location of the company selling expenses is limited to expenses SAA, section 772(d), and the in whose books the expenses are incurred in the United States for Department’s proposed regulations. recorded. The petitioner interprets economic activities in the United States. Finally, MHI cites the Pasta Final section 351.402(b) of the proposed MRD adds that its sales section in Determination (at Comment 2), regulations (Notice of Proposed Germany responsible for U.S. sales explaining that the Act requires the Rulemaking and Request of Public activities performs these activities in Department to make deductions to CEP Comments, 61 FR 7308, 7381 (February Germany, and that the costs for these only for those expenses associated with 27, 1996)) which states that ‘‘the activities cannot be deducted from U.S. economic activity in the United States. Secretary will make adjustments to CEP price under section 772(d). MHI further argues that if the under section 772(d) of the Act for MRD argues, however, that if the Department continues to treat MHI’s expenses associated with commercial Department decides to deduct indirect U.S. sales as CEP sales, then it should activities in the United States, no matter selling expenses incurred outside the continue to deduct only the indirect where incurred’’ to mean that the actual United States from U.S. price, then it selling expenses incurred on behalf of physical location of those commercial should recalculate the amounts reported economic activities occurring in the activities is not a qualifying criterion. for U.S. sales. The respondent explains United States. The petitioner maintains that much of that to calculate the reported expenses, DOC Position: We agree with the the pre-contract sales activity is handled it first divided the actual MRD indirect petitioner in general. The SAA (at 823) by the foreign manufacturer of LNPP selling expenses by the total value of states that: ‘‘[U]nder new section 772(d), and that the expenses incurred for such sales recorded by MRD, and applied the constructed export price will be activity should be deducted from CEP. resulting expense rate to the gross calculated by reducing the price of the The petitioner states that if the contract price for each U.S. sale. first sale to an unaffiliated customer in Department deducts U.S. indirect However, the MRD sales figures used to the United States by the amount of selling expenses from CEP based on the derive the expense rate include only the expenses (and profit) associated with geographic location in which they were amounts for the sales from MRD to MRU economic activities occurring in the incurred or booked, it would create an and not the value added in the United United States,’’ including, inter alia, enormous loophole through which States, whereas the gross contract price ‘‘any ‘indirect selling expenses’ ’’ expenses directly associated with U.S. for each sale to which the expense rate (emphasis added). In the Pasta Final sales could simply disappear. was applied does reflects the total value Determination, the Department According to the petitioner, of the presses delivered to the customer determined that it was proper to deduct respondents in antidumping cases with inclusive of the value added by MRU. indirect selling expenses incurred in the CEP could increase net U.S. prices by Therefore, to make a consistent home market in support of U.S. sales merely shifting selling expenses from calculation, MRD argues that the because such expenses were the books of their U.S. affiliates to those Department should either recalculate ‘‘specifically related to U.S. commercial of the foreign parent companies. the MRD indirect selling expense rate activity.’’ See Pasta Final Determination The petitioner states further that, at a using figures that correspond to the at 30352. The indirect selling expenses minimum, the Department should gross contract prices, or it should use reported by the respondents in these deduct from CEP all expenses included the existing rate but apply it only to the investigations are of the same class and in the foreign manufacturer’s accounts transfer price between MRD and MRU nature as those determined to be that relate to U.S. economic activity. for each sale. associated with U.S. economic activity These costs include: (1) All direct and TKS maintains that the Department in the Pasta Final Determination, i.e., indirect costs incurred for installation, has adopted a new methodology for they are general selling expenses warranty and technical servicing and calculating indirect selling expenses incurred and booked by the parent training, regardless of where such pursuant to the enactment of the URAA company in the home market to support expenses are originally incurred; (2) all which make petitioner’s arguments export sales, including those for the 38174 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

United States. This approach is in using the following methodology. First, agent in the United States and the conformity with the SAA at page 824, we calculated total indirect selling substance of the transaction was which directs that section 772(d)(1)(D) expenses by multiplying the reported unchanged. In Flat Products from Korea, provides for the deduction of indirect rate referred to above by each CEP price. the Department treated the respondent’s selling expenses from CEP where those We then subtracted that amount from sales as EP sales (formerly referred to as expenses ‘‘* * * would be incurred by each CEP price. Next, we calculated a ‘‘purchase price’’) even though the U.S. the seller regardless of whether the factor which is the proportion of all affiliate had engaged in activity in the particular sales in question are made, those adjustments to CEP made under United States. The Department found but reasonably may be attributed (at section 772(d) of the Act divided by the that not all of the respondent’s sales least in part) to such sales.’’ We have contract price net of the total indirect were delivered directly to the customer. therefore deducted indirect selling selling expenses calculated previously. However, the selling functions were expenses incurred in the home market The resulting factor was then applied to normally undertaken by the exporter. on U.S. sales from CEP, after making the indirect selling expense amount. We According to MHI, the Department’s certain necessary adjustments. then deducted the resulting value from analysis in Flat Products from Korea While we agree with the petitioner CEP. This methodology applies the centered on what activities were that all indirect selling expenses indirect selling expenses only to the conducted for the transaction as a whole directly associated with U.S. economic portion of CEP price which and not on where the transaction took activity, irrespective of the location differentiates CEP from export price place. MHI explains that MLP’s limited where they were incurred, should be (‘‘EP’’). installation activities, limited sales deducted from CEP, we do not believe Comment 2 EP or CEP Sales—U.S. activities, and limited parts that it is correct to use an indirect Subsidiaries’ Activities: MHI contests procurement activities only represent a selling expense factor which is derived the Department’s preliminary transfer of routine sales-related from a pool of expenses and sales conclusion that the U.S. LNPP activities to the United States. revenue which covers both U.S. and transactions under investigation should MRD maintains that the Department non-U.S. sales. The indirect selling be classified as CEP sales. MHI argues should analyze the Rochester and expense ratio reported by MHI for that MHI’s U.S. sales should not have Wilkes-Barre sales as EP sales, rather activities recorded at MHI’s Japanese been treated as CEP sales because (1) the than CEP transactions. This respondent headquarters and factory sales offices Department mischaracterized the extent states that the Department’s preliminary consists of a numerator inclusive of of the U.S. economic activities of its decision to treat these sales as CEP sales common selling expenses as well as U.S. subsidiary MLP (USA) Inc. was based on a misapplication of the specific selling expenses supporting (‘‘MLP’’), and (2) the Department should standards used to distinguish EP from U.S. exports and other exports sales, not have treated installation as further CEP sales. MRD maintains that the divided by a denominator consisting of manufacturing. standard for such differentiation is all export sales. Similarly, the indirect MHI claims that MLP’s sales activities whether the performance of functions selling expense ratio reported by MRD were not as broad as characterized by by the U.S. subsidiary changes the for activities recorded at MRD’s the Department. According to MHI, substance of the transaction or the Augsburg facilities consists of data MHI’s sales clearly qualify as EP sales functions themselves. According to related to both the U.S. and other export under Section 772(a) of the Act. MHI MRD, MRU’s role in the Rochester and markets. The indirect selling expense states that the Department generally has Wilkes-Barre sales does not transform ratio reported by TKS for activities three criteria for determining if a sale is the sales from EP to CEP sales, as it was recorded at TKS’s Tokyo headquarters to be based on EP. MHI states that the not essential. MRD asserts that the consists of a numerator inclusive of third criterion, where an affiliated U.S. functions performed by MRU for these common selling expenses as well as agent ‘‘acted as more than a processor of sales—document processing, arranging specific selling expenses supporting sales-related documentation and a for local sourcing of certain materials U.S. exports, other exports sales, and communications link with the and services, communicating and domestic sales, divided by a unaffiliated United States customers coordinating with the customer—are the denominator consisting of world-wide *** .’’ was applied to MLP and was same functions that MRD routinely sales. These allocations resulted in each the main reason for applying CEP to performs from Germany for third company’s reported indirect selling MHI’s sales. MHI claims that MLP’s country sales. By contrast, the sales to expense rate. sales-related activities were limited. Charlotte, Fargo and Global did require Each respondent’s indirect selling According to MHI, subcontractors were MRU’s participation and are properly expenses incurred in the home market responsible for installation, and MLP characterized as CEP sales, as they were were reported as including expenses only sent engineers to supervise. either produced almost entirely at generally associated with U.S. exports, According to MHI, the primary role of MRU’s facilities in the United States or although the respondents maintained MLP is to act as an interface between underwent substantial further that such expenses did not relate to the MHI sales team in Tokyo and MHI’s processing there. ‘‘U.S. economic activity.’’ At U.S. customers. MHI argues that MLP Furthermore, MRD argues that, verification, we were able to confirm did nothing more than implement because the Rochester and Wilkes-Barre that certain of the indirect selling purchasing instructions from MHI for a sales were made prior to importation expenses were associated with U.S. certain limited number of parts. and were not sold from the U.S. economic activity. We were unable, MHI cites the Final Results of the affiliate’s inventory or subject to further however, to quantify the portion of the Administrative Review of Certain manufacturing in the United States, they total indirect selling expenses which Corrosion-Resistant Carbon Steel Flat must be treated as EP sales under the were associated with the U.S. sales. Products from Korea (61 FR 18547, Department’s established practice. Also, Therefore, for these final 18562, April 26, 1996) (‘‘Flat Products MRD contends that the minor determinations, we have deducted, as from Korea’’) to support its contention warehousing required for these sales as non-adverse facts available, only a that in setting up MLP’s sales activities, a result of the logistical problems portion of the total indirect selling MHI merely transferred these routine inherent in shipments of large capital expenses recorded in the home market selling functions to its related selling equipment, and the addition of non- Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38175

German parts during the installation the Flat Products from Korea and manufacturing, which by definition process, does not transform these sales Polyethylene Terephthalate Film, Sheet means that these affiliates were more into CEP sales. Additionally, MRD notes and Strip from Japan (60 FR 32133, than documentation processors and that the Department’s reliance on New 32135, June 20, 1995) to support its communication links. According to the Minivans from Japan (57 FR 21937, May contention that just as the lack of petitioner, maintaining U.S. operations 26, 1992) (‘‘Minivans’’) and Certain additional expenses such as technical to oversee further manufacturing of Internal-Combustion Forklift Trucks services, advertising and warranties by LNPPs necessarily entails salaries for from Japan (‘‘Forklifts’’) (53 FR 12552, an U.S. affiliate indicate the use of engineers and supervisors, and the April 15, 1988) in the preliminary export price, so, conversely, where the general and administrative expenses to determination to treat the sales at issue U.S. affiliate performs additional support them. Under such as CEP sales is misplaced. MRD states functions such as technical support, circumstances, the petitioner argues that that, in Minivans, the Department training, and warranty servicing, the characterization of a further concluded that the U.S. subsidiaries of Department will treat the sale as a CEP manufactured sale as a standard export the Japanese automobile manufacturers transaction. The petitioner enumerates price transaction would ignore these played such a significant role in the U.S. the various functions performed by the substantial U.S. expenses related to the sales and distribution structure for their U.S. affiliates of MHI, TKS and MRD— sale of subject merchandise, and would imported automobiles that the sales had marketing, sales promotion, training, not result in a fair comparison. For all to be classified as CEP sales. The types warehousing and installation support, of these reasons, the petitioner argues of efforts performed by these U.S. where applicable—and asserts that these that the substantial U.S. economic subsidiaries required a U.S. presence activities constitute more than mere activities require the Department to treat similar to that required for a sale from processing of sales documentation. the U.S. sales as CEP transactions. Furthermore, the petitioner notes that the U.S. subsidiary’s own inventory. In DOC Position: We agree with the TKS recognized that the selling contrast, none of the functions petitioner and have treated all of the activities of its selling agent far performed by MRU for the Rochester respondents’ U.S. sales as CEP sales. In exceeded the Department’s minimal and Wilkes-Barre sales require a past cases such as Forklifts, where the threshold for indirect export price sales presence in the United States. MRD Department has ruled that sales such as and reported its U.S. sales as CEP and explains that, in Forklifts, the those at issue (i.e., sales made through further-manufactured sales. The Department’s reasoning for classifying a related sales agent in the United States petitioner states that although MHI sales made through an affiliated sales to an unrelated purchaser prior to the agent to an unaffiliated purchaser as EP reported its sales as EP transactions, the Department correctly classified its U.S. date of importation) are EP sales sales hinged in part on the fact that the (formerly purchase price), it has functions performed by the affiliated sales as CEP-further-manufactured sales at the preliminary determination. examined several criteria, including: (1) seller did not change the substance of Whether or not the sales were shipped the transaction, and in part on the fact According to the petitioner, this preliminary determination was directly from the manufacturer to the that the sales were made prior to unaffiliated U.S. customer; (2) whether importation. Therefore, MRD asserts confirmed during verification, where the Department reviewed the or not the sales follow customary that, in accordance with the reasoning commercial channels between the outlined in Forklifts, the sales to documentation of MLP’s procurement of auxiliary parts and its sales servicing parties involved; and (3) whether or not Rochester and Wilkes-Barre should be activities, both of which go well beyond the function of the U.S. selling agent is treated as EP sales. the narrow confines established by the beyond that of a ‘‘processor of sales- The petitioner maintains that under Department for indirect export sales.The related documentation’’ and a the language of the statute, all U.S. sales petitioner disagrees with MRD’s claim ‘‘communications link’’ with the made by all respondents in these that the Department classifies a sale as unrelated U.S. buyer. Where all three investigations must be treated as CEP EP unless the functions performed by criteria are met (i.e., sales are not transactions. The petitioner argues that the U.S. affiliate could not have been inventoried, the commercial channel is the export price definition contained in performed by the foreign producer/ customary and the function of the U.S. the statute does not apply to sales made exporter without the U.S. affiliate. The selling agent is not substantively more by a U.S. selling affiliate of a foreign petitioner asserts that it is the than a ‘‘processor of sales-related manufacturer or exporter. The petitioner significance of the activities performed documentation’’ and a states that, despite the apparent clarity by the U.S. affiliate and not their ‘‘communications link’’), the of the statutory language, the transportability that counts in the CEP Department has regarded the routine Department’s practice has been to versus EP analysis. The petitioner also selling functions of the exporter as consider a sale by an affiliate as an refutes MRD’s analysis of the ‘‘merely having been relocated ‘‘indirect’’ export price transaction Department’s decisions in Minivans and geographically from the country of where the merchandise is shipped Forklifts, claiming that in both cases the exportation to the United States,’’ and directly to the buyer without any Department focused on the functions has determined the sales to be EP sales. inclusion in the selling affiliate’s performed by the U.S. sales affiliate. In In other words, where the functions are inventory, and where the U.S. sales addition, the petitioner states that the performed ‘‘does not change the affiliate acts only as a processor of only exception to the rule that substance of the transactions or the documentation and as a warehousing necessitates CEP treatment functions themselves.’’ See Forklifts at communications link with the is when the producer provides 12553. There are numerous cases where unaffiliated buyer. It maintains that the warehousing at the customer’s demand, the Department has relied on the above- indirect export price definition in the which is not the case for the Rochester specified criteria to characterize sales as respondents’ case cannot be applied and Wilkes-Barre sales. EP (formerly purchase price) or CEP because the U.S. sales subsidiaries Finally, the petitioner maintains that (formerly exporter’s sales price), functioned as more than a mere CEP treatment is required because the including: Minivans; Flat Products from processor of sales-related installation activities of respondents’ Korea; and Final Determination of Sales correspondence. The petitioner cites to U.S. affiliates constitute further at Less Than Fair Value: Stainless Steel 38176 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Wire Rod from France (58 FR 68865, Furthermore, this reasoning is imported merchandise after importation 68868–9, December 29, 1993). consistent with our decision to treat and before the sale to an unaffiliated With respect to MHI, we believe that installation expenses as part of further purchaser. MHI believes that these the various activities of MHI’s manufacturing under section 772(d). See criteria form a temporal restriction subsidiary MLP were substantially more DOC Position to Comment 3, below. whereby value must be added at a point than ‘‘routine selling functions.’’ Rather, Maintaining U.S. operations to oversee after importation but prior to the date of MLP was significantly involved with the further manufacturing of LNPPs sale of the subject merchandise. MHI sale of LNPP in the following areas: necessarily entails significant expenses therefore contends that the installation selling agency, after-sales servicing, including salaries for engineers and MHI provides on its U.S. sales cannot sourcing of non-subject parts, and supervisors, and the general and qualify for a further-manufacturing supervision of installation. As MHI’s administrative expenses to support adjustment because it was provided principal sales agent in the United them. Under such circumstances, the after, and not prior to, sale and delivery States, MLP was directly responsible for characterization of a further to the customer’s specified destination identification of Piedmont as a buyer, manufactured sale as an export price sites. and cooperated with Sumitomo in the transaction would ignore these MHI argues that the principles in delegation of oversight for the Guard substantial U.S. expenses related to the Forklifts and Certain Small Business sale. With respect to after-sales sale of subject merchandise and would Telephone Systems and Subassemblies servicing, MLP incurred warranty result in an unfair comparison in the Thereof from Korea (54 FR 53141, expenses for both sales. Also, for both dumping analysis. We believe that the December 27, 1989) (‘‘SBTS’’) to which sales, MLP supervised installation presence of a subsidiary’s participation the Department referred at its through the work of its engineers, and in further-manufacturing activities preliminary determination, do not apply procured parts which were substantial particularly bolsters the use of CEP to LNPPs. According to MHI, in SBTS, in quantity, value and functional analysis. We note that the Department the Department determined that the importance. For the Piedmont sale, MLP has always analyzed further combination of subject and non-subject provided direct technical assistance, manufacturing in the context of CEP merchandise should be treated as and for both the Guard and Piedmont (formerly exporter’s sales price) further manufacturing activity. MHI sales MLP was responsible for direct methodology. In the Final contends that the bulk of its LNPP oversight of installation performed by Determination of Sales at Less Than installation and installation supervision expenses do not relate to the subcontractors, including payment of Fair Value: Certain Carbon and Alloy combination of subject and non-subject services rendered. Steel Wire Rod from Canada, 59 FR 18791, 18794 (April 20, 1994), the merchandise, but to the reassembly of With respect to MRD, we also believe Department considered the possibility LNPP components. that the third EP criterion is not of performing EP (formerly purchase MHI claims that in its operations, satisfied in the case of MRU. MRU’s role price) analysis on certain sales which while auxiliary parts were shipped with respect to the sales at issue is involved further processing by an directly to the site of installation, they beyond that of a mere ‘‘processor of unaffiliated subcontractor. The could have easily been shipped to Japan sales documentation’’ and Department excluded the sales in and then back to the site of installation. ‘‘communications link.’’ MRU played a question from its analysis because the MHI contends that this scenario is major role in the negotiations between removal of value added by the substantively different from that in MRD and the U.S. customer for the unaffiliated purchaser from the Forklifts, where Toyota’s U.S. economic Rochester and Wilkes-Barre sales, from purchase price would have resulted in activities involved extensive relocation the bidding stage through to the final further manufactured purchase price of its Japanese manufacturing activities contracts and subsequent amendments sales, and thus would have been to the United States. MHI claims that it to the final contracts, and incurred completely inconsistent with section does not normally ‘‘install’’ a LNPP at significant SG&A expenses in the 772 of the Act. its Wadaoki assembly facility prior to process. The contractual documentation TKS reported all of its sales as CEP exportation, nor does it complete final and sales-related correspondence sales, so that the general issue of CEP reassembly of the finished components viewed at verification attests to this fact. analysis is moot. TKS maintains, anywhere but at the customer site after Furthermore, we verified that MRU however, that its Dow Jones sale is CEP shipment and delivery. MHI maintains supports MRD’s activities in the but not a further-manufactured sale. For that it is purely accidental that the shipment and installation process discussion of this issue, see TKS Department happened to use the term relevant to these sales. This is Comment 5 in the companion Federal ‘‘installation’’ in discussing the evidenced by the fact that MRU is Register notice for LNPPs from Japan. respondent’s U.S. economic activity in responsible for the post-sale Comment 3 The Treatment of Forklifts. warehousing of the merchandise Installation Expenses: MHI argues that MHI argues that LNPP installation shipped from Germany (which, while the Department should not treat should be treated as a movement performed to meet the customer’’s installation expenses as further expense, rather than as part of further timing needs, was not considered by the manufacturing. MHI refers to U.S. law manufacturing. MHI cites section respondent to be a routine service and case precedent to support its claim 772(c)(2)(A) of the Act which states that performed under the terms of the that installation does not constitute EP (or CEP) for movement related original sales contract), as well as the further manufacturing. The respondent activity should be reduced by ‘‘the contracting of rigging companies and cites to the Senate Committee On amount, if any, included in such price, the sourcing of auxiliary parts essential Finance, et al., Uruguay Round attributable to any additional costs, to the installation process in the United Agreements Act, S. Rep. No. 412, 103d charges, or expenses * * * which are States. Given its parts procurement role, Cong., 2d Sess. 66 (1994), to support its incident to bringing the subject it is possible that MRU may engage in contention that an adjustment for merchandise * * * to the place of warranty servicing support activities for further manufacturing is appropriate for delivery in the United States * * *.’’ the Rochester and Wilkes-Barre sales in an increase in value based on a process MHI maintains that the Department the post-installation and start-up period. of manufacture or assembly of the should follow its practice in the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38177 investigation of Mechanical Transfer site. According to MRD, the situations each customer’s facility. In addition, the Presses from Japan (55 FR 335, January in SBTS and Forklifts involved the petitioner disagrees with MRD’s 4, 1990) (‘‘MTPs’’), where it determined modification of the subject merchandise analysis of Forklifts and SBTS, stating that installation charges should be after importation at the option of the that in both cases the Department treated as movement expenses, because customer not the simple reassembly of treated the addition of integral LNPP systems present virtually the merchandise as a result of the components, or integration of subject identical shipment reassembly shipment process. In addition, MRD and non-subject subassemblies, during requirements as MTPs. asserts that the fact that LNPPs often are installation as further manufacturing. MHI disagrees with the Department’s not fully assembled before shipment DOC Position: We agree with the preliminary determination that the (otherwise known as ‘‘staging’’), or that petitioner. We believe that the items added to a LNPP during some additional non-German items are Department correctly classified installation are ‘‘integral’’ to the incorporated into the press system installation charges as part of further function of the press, whereas those during installation, does not change the manufacturing because the U.S. items added to MTPs during installation nature of the installation process. installation process involves extensive were not. MHI explains that the The petitioner states that the technical activities on the part of Department has not cited any support Department properly classified engineers and installation supervisors for determining that additions made to installation charges in its preliminary and the integration of subject and non- MTPs in the United States were not determination as part of U.S. further subject merchandise necessary for the operation of LNPPs. As the parties have integral to MTPs. MHI maintains that, manufacturing under section 772(d)(2) even assuming arguendo, that certain stated, the Department has not applied because the U.S. installation process LNPP auxiliary parts were integral to a blanket rule on the treatment of involves extensive technical activities press operation, the Department gave no installation expenses, sometimes on the part of engineers and installation reason why the addition of ‘‘integral’’ treating them as assembly costs, a supervisors and the integration of parts, as opposed to ‘‘non-integral’’ circumstance of sale adjustment or subject and integral, non-subject parts, is a legally meaningful shipment expenses, depending on the merchandise necessary for the operation distinction. MHI states its conclusion particular circumstances involved. See of LNPPs. The petitioner maintains that that such a distinction is irrelevant to a Forklifts, 53 FR 12552, 12565 (April 15, the Department has never applied a determination on the nature of 1988); SBTS, 54 FR 53141, 53151 blanket rule on installation expenses, installation costs. (December 27, 1989) and MTPs, 55 FR MHI also disagrees with the treating them as assembly, a 335, 339 (January 4, 1990). Where those Department’s preliminary conclusion circumstance of sale adjustment, or circumstances include the incorporation that LNPP installation is far more shipment expenses, depending on the of integral, non-subject components complex than the reassembly operations particular circumstances involved. during installation or complex examined in the investigation of MTPs. Where those circumstances include installation operations that are more MHI claims that its review of the public incorporation of integral, non-subject than mere reassembly, the precedent record of the MTPs investigation components during installation or clearly supports treatment of revealed no basis to determine that the complex installation operations that are installation expenses as further reassembly and installation of LNPPs is more than mere reassembly, the manufacturing. See SBTS. In this case, more complex than that of MTPs, since precedent clearly supports treatment of the respondents’ U.S. subsidiaries’ roles there was no public discussion of any of installation expenses as further in the sale, installation and servicing of the attributes of MTP installation which manufacturing. The petitioner contrasts LNPPs, and their supervision of the would indicate complexity, such as: the the level of complexity in this incorporation of integral, non-subject time involved in installation, the investigation to that in MTPs to support components during installation, number of engineers required to its contention that, in addition to the constitute a process that is more than complete installation, the length of time integration of non-subject parts, the very mere reassembly. for installation, or the amount of complexity of the installation and the The integration of integral non-subject expense (absolute or relative) incurred extent of entirely new assembly also merchandise and the technical during installation. affects the Department’s treatment of the complexity of LNPP installation MRD argues that the Department expenses. The petitioner asserts that in distinguishes the instant processes from should classify the installation costs for MTPs, installation costs were treated as that of MTPs, which was a ‘‘mere the Rochester and Wilkes-Barre sales as shipment expenses because installation reassembly of subject parts.’’ Unlike the movement costs, rather than installation primarily involved simple ‘‘reassembly’’ equipment covered in MTPs, the costs, in accordance with its of parts originally disassembled at the respondents’ LNPPs were never fully longstanding practice in cases involving foreign producer’s export facilities. The assembled and fully tested in the large capital equipment. MRD asserts petitioner maintains that the country of production, since the integral that the factual pattern in this case is Department’s determination in MTPs is parts incorporated at the plant sites in similar to that in MTPs and Large Power not applicable to LNPPs because none of the U.S. were required for the press to Transformers from Japan (48 FR 26498, the U.S. LNPP sales involved the mere actually run to print a newspaper. 26501, June 8, 1993) (‘‘LPTs’’), rather reassembly of subject merchandise. Finally, the installation of these LNPPs than in SBTS and Forklifts, the cases on Also, the petitioner contends that the involves integration of the merchandise which the Department incorrectly relied subject merchandise in this into the physical and electrical plant of in the preliminary determination. MRD investigation was never fully assembled the customer’s installation site and often explains that the installation process in and tested before shipment, but instead requires modification of LNPP the instant case, similar to that in MTPs, was fully constructed for the first time components or the site itself for is required because of the size of the at the customer’s site, involving many successful completion of the LNPP. merchandise involved, and the resultant hours of engineering, installation and With respect to MHI, for both the need for disassembly of the testing, and the integration and Piedmont and Guard sales, the purchase merchandise for exportation and installation of the subject merchandise of integral parts for installation was not subsequent reassembly at the customer’s into the physical and electrical plant of limited, as suggested by the respondent, 38178 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices but was significant. The role played by If the Department calculates profit on a record. Alternatively, KBA believes that MLP in installation activities is transaction-specific basis, MRD it should be assigned the ‘‘all others’’ evidenced by its purchasing of auxiliary contends that home market sales with rate. parts, installation supervision and other abnormally high profits should be For purposes of the final oversight responsibilities. The excluded from the CV profit calculation. determination, KBA argues that the Department’s treatment of MLP’s The petitioner maintains that the Department cannot legally assign KBA oversight, control and payment of third- Department should use the same CV the 46.40 percent margin based on the party installation as further profit methodology applied in the adjusted petition rate in the notice of manufacturing is completely consistent preliminary determination (i.e., initiation, as it did in the preliminary with the Final Determination of Sales at calculate profit on a model-specific determination, because the record Less Than Fair Value: Dynamic Random basis). With respect to MHI, the evidence shows that the petition data Access Memory Semiconductors of One petitioner asserts that there was nothing are incorrect and cannot be Megabit and Above from the Republic of in the record which suggests that profits corroborated. In addition to the pre- Korea, 58 FR 15467, 15476 (March 23, on any sales were ‘‘abnormally’’ high. initiation modifications made to the 1993), wherein the Department The petitioner argues that the sales were data in the petition, KBA asserts that the determined that fees paid for processing at arm’s length so the profit level should Department must further corroborate by an unaffiliated subcontractor were be normal. Moreover, the petitioner that information based on the accurate, further manufacturing expenses. asserts that there are too few sales to verified information on the record and Contrary to MHI’s characterizations, the establish a pattern of normal versus assign the resultant revised amount to Department believes that the extent of abnormal profit. In addition, the KBA. KBA states that the SAA cautions such activities performed on these sales petitioner maintains that the profit rates that secondary information, such as was significant, as measured by the suggested by MHI as being abnormally petition information, used as facts value of such services to the total high do not distort the average profit. otherwise available, may not be reliable contract price of the sales. With respect to MRD, the petitioner because it is based on unverified Further, with respect to MHI’s asserts that even the highest profit allegations. Therefore, to the extent arguments, we note also that there is no calculated on MRD’s home market sales practicable, it must be corroborated ‘‘temporal restriction’’ to the definition is not abnormal because it falls with the from independent sources that are of further manufacturing. The variability range for all home market reasonably available to the Department. Department stated in SBTS (at Comment sales and, thus, should not be excluded. KBA points out that the SAA (and the 9): With respect to ‘‘after-sale’’ sales, the Department’s proposed regulations) also petitioner argues that the profit on states that independent sources include Because non-subject merchandise is added ‘‘after-sale’’ services is not part of the information obtained from interested to the subject subassemblies, the portion of foreign like product. Moreover, the installation expenses attributable to the parties during the investigation. Because addition of the non-subject merchandise petitioner could not segregate these the revised petition rate is based solely cannot reasonably be treated as a ‘‘after-sale’’ profits by product-line. on data for one of MRD’s sales and MRD circumstance of sale adjustment. It is, rather, DOC Position: We disagree with has fully participated in the part of the value added in conjunction with respondents that simply because certain investigation, KBA argues that the the non-subject merchandise. Whether this home market sales had profits higher verified information on the record with value is added before or after the sale is than those of numerous other sales, the respect to this sale can and should be irrelevant because, for this product, EIS’s profits are automatically abnormally used to corroborate and, if necessary, to customers expect the installed system to have high and outside the ordinary course of revise petitioner’s information further. the characteristics added by the non-subject trade for purposes of computing CV Furthermore, KBA maintains that the merchandise. (Emphasis added.) profit. In order to determine that profits Department’s corroboration procedures This fundamental customer expectation are abnormally high, there must be for purposes of the preliminary of the characteristics of the final, certain unique or unusual determination were legally insufficient. installed and functional equipment characteristics related to the sales in KBA takes issue with the Department’s holds true for LNPP as well. question. However, the respondents claim that it re-examined the petition Comment 4 Treatment of Sales With have provided no credible information price data and found it continued to ‘‘Abnormally High Profits’’: If the other than the numerical profit amounts have probative value. According to Department continues to undertake a to support their contention that certain KBA, the test is not to re-examine or review of individual home market sales home market sales had abnormally high determine whether the data have in its final calculation, MHI contends profits. Accordingly, we excluded no probative value, but to corroborate that that the Department should also exclude home market sales from the CV profit data to the extent practicable. KBA does sales with abnormally high profits. MHI calculation due to abnormally high not view the 46.40 percent margin argues that sales with abnormally high profits. alleged in the notice of initiation, which profit also fall within the definition of We agree with the petitioner that is based on MRD’s data, as evidence of sales occurring outside the ordinary ‘‘after-sale’’ sales are not part of the the dumping margin on KBA imports of course of trade. MHI asserts that two of foreign like product. Thus, MRD’s subject merchandise, because it is its home market sales have abnormally argument that the Department should significantly higher than the 17.70 high profits and therefore should be include profits from these ‘‘after sale’’ percent preliminary margin calculated excluded. sales is misplaced. for MRD. In light of this fact and the MRD argues that the Department evidence on the record, KBA does not should include profit on ‘‘after-sale’’ Company-Specific Issues in the German believe it is accurate or reasonable to sales in calculating home market profit. LNPP Investigation claim that the petition price data has However, since MRD’s normal records Comment 1 KBA’s Final Margin: any probative value. In accordance with do not segregate ‘‘after-sale’’ profits by KBA believes that its final margin the statute and the practice set out in market or product line, MRD asserts that should be based on the data relevant to the preliminary determination of the Department should use the overall the MRD sale in the petition, adjusted Bicycles from the People’s Republic of average profit of its Web Press Division. based on the verified information on the China (60 FR 56567, November 9, 1995) Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38179

(‘‘Bicycles’’), KBA asserts that wherever others’’ rate which, in this case, would determination. See ‘‘Facts Available’’ data collected from MRD is inconsistent have been MRD’s rate. section of this notice. with the data contained in the petition The petitioner maintains that the We disagree with the respondent’s on the MRD sale, the Department should Department properly assigned KBA the claim that the Department should not reject the petition data in favor of MRD’s margin contained in the notice of use facts available or make adverse actual data for use as facts otherwise initiation as facts available in the inferences in its case, but rather should available. KBA also asserts that the preliminary determination, contending apply the ‘‘all others’’ rate . According decision in the preliminary that KBA’s refusal to cooperate justifies to section 776(a) of the Act, the determination of Certain Pasta from an adverse inference. According to the Department shall use facts available if Italy (61 FR 1344, January 19, 1996) petitioner, KBA was properly identified an interested party does not provide (‘‘Pasta Preliminary Determination’’) on as one of two exporters of subject necessary information or significantly which the Department relied in making merchandise to the United States and, impedes an investigation. The SAA its facts available ruling for KBA in the therefore, the Department was fully explains that the Department’s potential justified in its decision to require it to use of facts available provides the ‘‘only preliminary determination was respond to the antidumping incentive to foreign exporters and inconsistent with the statute to the questionnaire. The petitioner also producers to respond to the extent that it did not go beyond its pre- dismisses KBA’s claims that its small Department’s questionnaire’’ (SAA at initiation analysis in its efforts to volume of exports somehow exempts it 868). Applying an adverse inference to corroborate petition information. In from responding to the Department’s a non-cooperating party ensures that the addition, unlike the Pasta Preliminary questionnaire. Under the URAA, the non-responding party does not obtain a Determination, where the Department Department must establish a separate more favorable result by failing to used as facts available the median of the margin for each exporter, unless the cooperate than if it had cooperated range of estimated dumping margins number of transactions or exporters fully. The facts available or adverse from the notice of initiation, the makes such a procedure impractical, inference applied need not be proven to Department in the instant investigation which is not the situation in this case. be the best alternative information, only based KBA’s margin on a sole sale of In addition, the petitioner dismisses that it is reasonable to use under the another company and the facts KBA’s reasons for refusing to cooperate particular circumstances (SAA at 869). supporting the alleged margin have been as irrelevant since the statute does not In this case, if KBA were to receive the proven incorrect during the course of condition the use of an adverse ‘‘all others’’ margin instead of the this investigation. inference on the motive of a non- adverse facts available margin, as KBA Alternatively, KBA suggests that it be cooperating party. According to the suggests, it would receive the exact assigned the ‘‘all others’’ rate. KBA adds petitioner, applying an adverse same treatment as MRD, which that it withdrew its participation from inference in KBA’s case ensures that a responded to the Department’s the investigation because the extensive non-cooperating party does not benefit questionnaire. This result would not cost of preparing a response was totally more by its failure to cooperate than to fulfill the objective of section 776 of the disproportionate to its role in the U.S. comply with the Department’s Act. Similarly, we note that it would be market where its past sales of German- requirements. Finally, in the petitioner’s inappropriate to assign to KBA, as made LNPPs were insignificant and no view, the Department did corroborate adverse facts available, the actual future sales of German-made LNPPs the secondary data used as facts margin calculated for the MRD sale in were expected. For this reason, KBA otherwise available. According to the the petition, because this rate is lower asserts that the Department should petitioner, the statute establishes that than the final overall margin for MRD consider it a non-shipper in which case the Department satisfies the which cooperated fully in this it would receive the ‘‘all others’’ rate. corroboration requirement if it finds that investigation. the information at issue has probative With respect to the respondent’s KBA maintains that the Department value. In this investigation, the opposition to our corroboration should not make adverse inferences petitioner asserts that the pre-initiation procedures, we note that the SAA (at against KBA, as KBA’s decision not to analysis of the petition satisfied this 870) defines corroboration of secondary respond to the Department’s threshold. information to mean that the questionnaire was driven by financial DOC Position: We agree with the Department will satisfy itself that the reasons and not by any other perceived petitioner. In our preliminary secondary information to be used as the benefit from non-submission of determination, pursuant to section 776 basis for facts available has ‘‘probative information. At the time KBA made its of the Act, we assigned KBA the margin value.’’ The determination of ‘‘probative decision, it had no way of knowing the in the notice of initiation as facts value’’ is assessed on a case-by-case margin MRD would receive, whether the otherwise available because it failed to basis. We stated in our preliminary Department would accept its data, respond to the Department’s notice that, in accordance with section whether the information would be questionnaire. We stated at that time 776(c) of the Act, we corroborated all of verified and/or whether the Department that, in accordance with section 776(b) the secondary information on which the would use facts available. Additionally, of the Act, an adverse inference was margin in the petition was based during KBA asserts that prior to the 1995 warranted with respect to KBA because our pre-initiation analysis of the amendment to the antidumping statute, it failed to cooperate by not acting to the petition to the extent appropriate the Department’s practice was to issue best of its ability to comply with the information was available for that questionnaires to exporters accounting Department’s request for information so purpose at that time. For purposes of the for the first 60 percent of exports of that the Department could make a preliminary determination, we re- subject merchandise. Had this rule still determination with respect to the extent examined the price information been applicable, KBA states that it of KBA’s dumping or lack thereof. provided in the petition in light of probably would not have been deemed Consistent with our preliminary information developed during the a mandatory respondent and received a determination, we believe that an investigation, and found that it questionnaire in this investigation. adverse inference is warranted with continued to be of probative value. For Thus, it would have received the ‘‘all respect to KBA for purposes of the final the final determination, we compared 38180 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices the petition price information with Recipients. For whatever reason KBA section 772(e) of the Act which provides verified data on the record and again decided to withdraw from the that the Department may employ found that it continued to be of probative value. Nothing in the statute investigation as an active respondent, alternative methods to determine CEP or the SAA compel us to go beyond the Department must now make adverse when the U.S. value added exceeds the these procedures. inferences consistent with the value of the imported merchandise. Contrary to the respondent’s claims, principles outlined above. Therefore, for MRD asserts further that the first two our corroboration procedures in this purposes of the final determination, we alternative methodologies described in case are not inconsistent with the have assigned to KBA the amended section 772(e) would be difficult to preliminary determinations in Pasta or petition margin in the notice of apply to the Charlotte sale because there Bicycles. In Bicycles, the Department initiation of 46.40 percent. were no sales of identical or other compared the data in the petition to Comment 2 Sales Exclusion merchandise that could be compared to secondary data which included, but was Requests: MRD argues that the the NV for the Charlotte sale. Therefore, not limited to, the same type of data Department should exclude certain sales MRD maintains the Department should used as the basis for the petition and the from its final calculations—namely, use ‘‘another reasonable method’’ audited financial reports of two of the Charlotte, Fargo and Global—because permitted under the ‘‘Special Rule’’ of largest Indian bicycle producers. These they involve imports of parts and section 772(e) of the Act. At a procedures did not seek to replace the subcomponents that are not subject to minimum, MRD argues that the secondary information with respondent- the scope of the investigation. With Department should assign a substantial specific information, but rather to respect to the Charlotte sale, the portion of the loss on the sale to the U.S. compare it against that information in respondent argues that, in the initial operations that caused it. order to determine if it had ‘‘probative phases of the investigation, both the Furthermore, MRD argues that the value.’’ In Pasta, unlike the instant petitioner and MRD agreed that it sales to Fargo and Global should also be investigation where KBA did not should be excluded from the excluded because they do not consist of attempt at all to respond to the Department’s analysis because the subject components and therefore fall Department’s questionnaire, the substantial U.S. content would distort outside the scope. Also, as explained in company to which facts available was the Department’s calculations. MRD its various responses, both sales applied at least attempted to respond to states that, while the Department’s involved unusual circumstances. In the Department’s questionnaire, but the preliminary determination did not general, the Fargo sale involved the sale information it submitted was inadequate dispute this reasoning, it questioned of a discontinued printing unit and unusable. Also, in the Pasta Final whether it had the authority to exclude produced partially in Germany and Determination, we concluded that the this sale based solely on this fact. partially in the United States. The petition was the only appropriate Because the Department had not Global sale involved a combination of information on the record to be used as reached a final decision on scope at that used equipment from MRU’s inventory facts available on the basis of having time, it decided to preliminarily include and a new printing unit which was compared the sizes of the calculated the Charlotte sale in its analysis. MRD produced partially in Germany and margins for the other respondents to the continues to believe that this sale does partially in the United States, and sold estimated margins in the petition. In the not represent subject merchandise and to a reseller which was responsible for Pasta case, as in the instant case, the therefore should be excluded. its installation. Even if the Department other respondents’ estimated margins According to MRD, none of the were to conclude that the parts and were lower than the petition margins. In imported parts and subcomponents subcomponents imported from Germany addition, in Pasta the Department did (taken singly or together) constitutes a for these sales were within the scope, not go beyond its pre-initiation analysis LNPP component whether defined by MRD urges the Department to exercise in its corroboration procedures. See the Department in terms of essence or its discretion to exclude these sales from Pasta Final Determination, 61 FR 30326, value. its analysis based on the fact that they 30329 (June 14, 1996). Moreover, MRD asserts that the are small and atypical. Furthermore, KBA’s references to the Charlotte sale involved an unusual The petitioner states that the pre-1995 antidumping law with respect situation and, if included in the Department should include all three to the Department’s determination of the Department’s analysis, would distort the sales at issue in its analysis. With appropriate recipients to the calculation of the antidumping margin. respect to Charlotte, the petitioner Department’s questionnaire are Specifically, MRD states that MRU argues that the cost overruns as a result irrelevant. Under the URAA, the experienced significant problems in the of ‘‘mismanagement’’ experienced by Department is now required to design and manufacturing of the press the respondent on this sale are not a investigate all known producers/ because of ‘‘mismanagement,’’ which valid reason to exclude the sale or apply exporters of subject merchandise unless resulted in significant cost overruns and special methodology within the context the number of transactions or exporters profit loss. The Department’s of the antidumping statute or the is administratively burdensome (SAA at preliminary determination deducted all Department’s practice. According to the 814). Furthermore, despite the fact that of the costs incurred in the United petitioner, if a cost overrun by itself there was no dumping allegation in the States, including the unexpected cost required exclusion of a sale, the cost petition specifically against KBA, the overruns, from the total sales price to calculation would become unfairly Department is required to conduct its determine CEP, thereby resulting in a skewed in favor of low-cost sales. The own research as to the universe of very high dumping margin for this sale. petitioner also disputes respondent’s producers/exporters of subject MRD points out that the Department has claim that Rockwell agreed to exclude merchandise and the appropriate the authority to exclude unusual sales, this sale from the investigation, stating recipients of its questionnaire. Thus, such as Charlotte, from its analysis if that only in the context of its proposal based on information received from the inclusion of those sales would distort for a four-year POI did it think that the U.S. Embassy in Bonn, we named KBA the results. Alternatively, if the Department could forego analysis of this as a respondent. See August 28, 1995, Department does not exclude the sale to sale given its complexity and the Memorandum to the File from Irene Charlotte, it should calculate CEP for reporting burden. However, in the two- Darzenta, et al., Re: Questionnaire that sale under the ‘‘Special Rule’’ of year POI adopted by the Department, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38181 the petitioner believes it is too manufacturing cost of the elements indicates that even the latest reported significant to omit and the respondent relative to the manufacturing cost of price adjustments might not be the last. has already met the burden of reporting each of the components of which they Therefore, the petitioner asserts that the the data for this sale. are a part is less than 50 percent. Department should rely on the sales The petitioner argues that the Because the imported elements do not prices in effect on the date of the filing Charlotte sale does not meet the criteria meet the 50 percent threshold on a of the petition and disregard the effects for exclusion of a U.S. sale from the component-specific basis and, therefore, of any post-POI amendments on prices dumping calculation because it is not do not constitute subject merchandise, and cost. ‘‘atypical’’ within the context of the we excluded the Charlotte sale from our MRD disagrees. First, it argues that it LNPP industry or so small as to have an final analysis. is common for specifications (and insignificant effect on the margin. In Applying the above-specified value therefore price) for large capital addition, the petitioner maintains that test to the imported elements relevant to equipment like LNPPs to be modified MRD’s ‘‘alternative methods’’ approach the Fargo and Global sales yields the after the initial contract is signed, and is unsubstantiated. According to the opposite result. That is, the cost of the the Department has recognized this in petitioner, MRD’s proposed alternative imported elements is greater than 50 past cases. According to the respondent, of attributing all or some of the loss on percent of the cost of the component of such changes are not unusual and do the Charlotte sale is unreasonable under which they are a part. The Department not support the conclusion that the section 772(e) of the Act which provides may exclude U.S. sales from its analysis seller has manipulated its prices to for the exclusion of losses in the if these sales are: (1) Not representative avoid dumping. Second, with respect to adjustment for further manufacturing. of the seller’s behavior, or (2) so small the Rochester price amendment, the Finally, the petitioner asserts that the that they would have an insignificant Department reviewed the merchandise sold to Charlotte is subject impact in the margin. See IPSCO, Inc. v. correspondence which showed the to the scope because it includes certain United States (714 F. Supp. 1211, 1217 amendment had been contemplated parts and subcomponents which are (CIT 1989). In the past, the Department before the petition filing. Third, MRD explicitly covered by the scope. excluded certain ‘‘atypical’’ or finds the petitioner’s analysis of its With respect to Fargo and Global, the unrepresentative U.S. sales, where the interests to be questionable, as it is petitioner contends that these sales also total pool of U.S. sales was great. See always in MRD’s interests to negotiate constitute subject merchandise and SBTS, 54 FR 53141, 53148 (December the highest possible price for its sales were not ‘‘atypical.’’ The petitioner 27, 1989). In the case of LNPPs, notwithstanding the filing of the claims that the imported merchandise however, where the sales are few and antidumping case. for both transactions contained all of the unique, such exclusion would not be DOC Position: We agree with the relevant mechanical parts of one of the appropriate. Given the limited number petitioner. In past cases, the Department five LNPP components which would of U.S. sales in this investigation and has stated that its standard practice is have included certain parts explicitly the fact that the sales at issue fall within not to accept price adjustments specified in the scope. The petitioner the scope of the investigation, we have instituted after the filing of a petition. also maintains that the fact that these no basis on which to exclude these sales Despite the nature of the merchandise sales involved discontinued equipment from our final analysis. Therefore, we under investigation, we have held that or were small in terms of value does not included the sales to Fargo and Global we are cautious in accepting price make them ‘‘atypical,’’ given the limited in our final analysis. increases which occur after receipt of a number and uniqueness of each of the Comment 3 Post-Petition Price petition so as to discourage potential U.S. sales under investigation, and the Amendments: The petitioner contends manipulation of potential dumping nature of the LNPP industry where that the Department should disregard all margins, and have determined the technological advances which result in post-petition price amendments and use original contract price which pre-dated the discontinuation of previous product instead the contract price as of the date the filing of the petition as the proper lines are common. of the filing of the petition as the basis for U.S. price. The transactions DOC Position: We agree generally starting price. The petitioner asserts that and prices under investigation are those with the respondent with respect to the such amendments applied to the in effect as of the filing of the petition. Charlotte sale, and with the petitioner Rochester, Wilkes-Barre and Charlotte See Cell Site Transceivers; Final with respect to the Fargo and Global sales. Citing the Final Determination of Determination of Sales at Less Than sales. The Charlotte sale involved the Sales at Less Than Fair Value: Cell Site Fair Value: Certain Hot-Rolled Carbon importation from Germany of less than Transceivers from Japan, 49 FR 43080, Steel Flat Products, Certain Cold-Rolled complete components destined to fulfill 43084 (October 26, 1984) (‘‘Cell Site Carbon Steel Flat Products, Certain a contract for a LNPP system in the Transceivers’’), among other cases, the Corrosion-Resistant Carbon Steel Flat United States. Both the Fargo and petitioner states that the Department’s Products, and Certain Cut-to-Length Global sales involved the importation practice calls for the rejection of Carbon Steel Plate from Canada, 58 FR from Germany of less than complete alterations in the prices of subject 37099, 37112 (July 9, 1993); Final components for the fulfillment of a merchandise after the filing of a petition Results of Administrative Review: contract for LNPP additions. As stated in order to prevent manipulation of Stainless Steel Wire Rod from France, in the ‘‘Scope of Investigation’’ section potential dumping margins. According 50 FR 9813, 9814 (March 12, 1995); and of this notice, we have determined that to the petitioner, that rationale is Final Results of Administrative Review: elements (i.e., parts and applicable in this investigation, where 64K Dynamic Random Access Memory subcomponents) imported to fulfill a MRD had every reason to negotiate a Components from Japan, 51 FR 15943, LNPP contract shall be included in the new price that would reduce the 15953 (April 29, 1996). Similarly, at the scope of the investigation if the sum of dumping margin. With respect to preliminary determination in this their cost of manufacture is at least 50 Rochester in particular, the petitioner investigation, we stated with respect to percent of the cost of manufacture of the finds suspect the significant profit the Rochester price amendment that finished LNPP component of which gained by MRD in the amended portion while we did not believe that the they are a part. In the case of Charlotte, of the transaction. Moreover, the contract amendment per se altered the our analysis of the sum of the number of reported amendments date of sale (given the industry involved 38182 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices and the nature of the construction of intent. In addition, the fact that MRD commodities which are offered for sale process for these large, customized begins production after the signing of in the ordinary course of trade.’’ See machines under investigation, where the letter of intent provides further MTPs at 341. The appropriate ‘‘earlier minor specification changes are justification for treating the letter of point’’ in the sale transaction for date of routine), we were ‘‘troubled by the fact intent date as the sale date. According sale purposes is determined on a case- that the sale price was modified to MRD, general contract law (Section by-case basis. In this case, we officially after the filing of the petition 2–201(3)(a) of the Uniform Commercial determined that the earliest point in the in this investigation, and that the Code) provides that a valid contract sale transaction, where the essential potential for the respondent to influence exists when the seller starts production terms of sale for the LNPP industry (i.e., purposely the margin calculation may for custom order goods that are not specifications, price, payment exist.’’ See February 23, 1996, suitable for sale to others in the ordinary schedules, warranty terms and Memorandum to Richard W. Moreland course of trade. MRD argues further that installation requirements) would be from The Team Re: Sales Exclusion the cancellation clauses in the letters of established definitively, is the sale Issues at 8. intent for Rochester and Wilkes Barre contract date, given the volume of sales Therefore, based on the foregoing should not affect the date of sale correspondence generated in the sales analysis, we have not considered any of analysis because the fact remains that at process and the potential minor the post-POI price amendments relevant the time of the letter of intent, the specification changes that may be made to MRD’s U.S. sales in our final analysis. parties had reached agreement on all of to the merchandise during the In addition, we note that the petitioner’s the basic terms of the sale. production process and after delivery. assertion that post-POI price The petitioner argues that in Furthermore, at verification, we amendments applied to three of MRD’s accordance with the Department’s long- observed that the terms of sale sales is incorrect. While we verified that standing practice, the appropriate date stipulated in the letters of intent did not post-POI price amendments applied to of sale in this investigation is the date definitively establish the material terms MRD’s Rochester and Wilkes Barre of contract. According to the petitioner, of sale, as they were subject to change sales, we did not observe any such price the essential terms of sale in the LNPP and to a definitive agreement of sale amendment to apply to the Charlotte industry (i.e., specifications, price, (i.e., a sale contract). See MRD Sales sale, as suggested by the petitioner. payment schedules, warranty terms and Verification Report at 11–12. Notwithstanding this fact, the issue is installation requirements) are Therefore, for purposes of the final moot with respect to the Charlotte sale established by the final contract, and determination, we have determined the given that we have excluded it from our not the letter of intent. The petitioner date of contract to be the appropriate final analysis. See DOC Position to states that the Department verified that date of sale. Our determination of the Comment 2 of the ‘‘Company-Specific MRD’s letters of intent for selected U.S. date of sale in this case is Issues’’ subsection of the ‘‘Interested sales did not definitively establish the distinguishable from that in the case of Party Comments’’ section of this notice. material terms of sale. Finally, the MHI’s Guard sale in the companion We also note that our final calculation petitioner asserts that in the cases cited investigation of LNPPs from Japan. In of CEP for the Rochester and Wilkes by the respondent to support its MRD’s case, the date of sale issue Barre sales, exclusive of post-POI price argument that the Department’s involves identifying the producer’s amendments, is consistent with our precedent establishes the date of sale earliest written documentation calculation of CV for these sales which earlier in the transaction involving large establishing the essential terms of sale, is based on the respondent’s submitted customized equipment, the date of sale whereas in MHI’s case the issue cost estimates and does not include the adopted was the contract date or, in the involves identifying the appropriate costs associated with the post-POI price absence of a formal written confirmation parties to the sale for date of sale amendments. See DOC Position to of sale, the initial order date. In this purposes. See MHI Comment 4 in the Comment 9 of the ‘‘Company-Specific case, the petitioner points out that the Federal Register notice of LNPPs from Issues’’ subsection of the ‘‘Interested letters of intent required a formal Japan. Party Comments’’ section of this notice. written confirmation of sale. Comment 5 U.S. Indirect Selling Comment 4 Date of Sale: MRD DOC Position: We agree with the Expense Cap: The petitioner argues that maintains that the Department should petitioner. The Department has a the Department should not cap U.S. use the letter of intent as the date of sale longstanding practice, which bases the indirect selling expenses allocated to for its U.S. sales, as this document is the date of sale on the date when all the particular sales at the amount incurred first written evidence that an agreement essential terms (usually price and during the POI because the allocation has been reached on the basic terms of quantity) are firmly established and no cap ignores the expenses incurred on those sales. Citing LPTs (48 FR 26498, longer within the control of the parties sales of subject merchandise outside of 26499, June 8, 1993) and MTPs (55 FR to alter without penalty. See, e.g., Final the POI. According to the petitioner, the 335, 341, January 4, 1990), MRD asserts Determination of Sales at Less Than Department’s allocation methodology that the Department has consistently Fair Value: Polyvinyl Alcohol from employed in the preliminary used the date of earliest written Taiwan, 61 FR 14064, 14067 (March 29, determination rests on the assumption evidence of agreement as the date of sale 1996). that POI sales could not have incurred in cases involving large made-to-order In this case, we determined that the selling expenses outside of the POI. But products and has consistently held that appropriate date of sale is the date of in cases such as the instant one, when minor changes in technical contract, and we solicited data from the sales efforts last for years and yield only specifications after the date of initial respondent on this basis. As stated in a limited number of large sales at agreement do not alter the date of sale. MTPs, the Department’s policy irregular intervals, it is logical to find MRD states that the basic terms in the regarding the date of sale in the case of that the amount spent to negotiate a final contracts were identical in all large, customized merchandise ‘‘has given group of sales was greater than the material respects to the terms outlined favored establishing the date of sale at total selling expenses incurred in the in the letters of intent, as supplemented an earlier point in the sale transaction limited period in which the sales were by the additional terms set forth in the process than at a later point, as it might made. Furthermore, the Department’s final proposals referenced in the letters be the case of fungible-type cap is inconsistent with section Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38183

772(d)(1) of the Act which requires the expenses for commercial presses to preliminary determination that the deduction from CEP of any expenses newspaper presses. Department should calculate the POI generally incurred in selling the subject Furthermore, MRD finds the selling expense rate based on sales merchandise. According to the petitioner’s proposals unacceptable. The orders, rather than sales recognized, so petitioner, whether the respondent respondent believes the petitioner’s as not to overstate selling expenses on incurred indirect selling expenses arguments are based on the incorrect POI sales in years where sales revenue during the POI is irrelevant to this assumption that indirect selling recognized is unusually low relative to requirement. In addition, the expenses can be matched to specific actual selling expenses incurred. Department’s cap ignores the pattern of sales. To the contrary, MRD explains Conversely, the petitioner has MRD’s sales, where the POI sales are indirect selling expenses are fixed maintained that such a calculation few but selling expenses are incurred on expenses that do not vary with sales, would grossly understate expenses for a regular basis before, during and after and thus they should be allocated over POI sales because it would disregard the the POI to account for activities ranging the value of orders received during the substantial expenses incurred before from the development of bids to POI. MRD reasons that in this case, and after the investigation period for amendments to signed contracts. The because the Department is applying the POI sales. petitioner argues further that the indirect selling expense rate to sales In the preliminary determination, Department should reject MRD’s made during the POI (i.e., sales for because application of the POI indirect proposals to cap U.S. indirect selling which orders were received during the selling expense rate reported by MRD to expenses up to the amount of total POI), it must calculate the rate on the U.S. sales prices resulted in transaction- expenses incurred during the POI on basis of the total value of orders specific selling expenses which newspaper sales, as this would amount received. MRD attempts to refute the exceeded the total indirect selling to allocating POI indirect selling petitioner’s assertions that a particular expenses incurred by MRU during the expenses over POI sales orders, which is period or calculation would capture the POI, we capped the amount of indirect contrary to the Department’s normal expenses that properly relate to the sales selling expenses deducted from CEP by calculation methodology. under investigation, stating that the the total indirect selling expenses If the Department is concerned about expenses can only relate generally to all actually incurred by MRU during the the magnitude of the verified POI selling of MRD’s sales efforts. With respect to POI. While this is not our normal expenses and their potential the three-year analysis advanced by the practice, we applied a ‘‘cap’’ on U.S. overstatement relative to total POI sales, petitioner, MRD states that in the indirect selling expenses in the the petitioner suggests that the petition, Rockwell argued for a four-year preliminary determination because the Department follow past practice and use POI because the three-year period from figures reported by the respondent verified data relevant to a three-year July 1992 to June 1995 was a period of appeared inaccurate and we did not period. The petitioner asserts that the sales depression that did not adequately have sufficient information to make any Department should not use the capture the LNPP business cycle. If the other adjustment. The petitioner claims respondent’s four-year data because, Department were to accept the that this ‘‘cap’’ ignores the fact that, in among other reasons, they were not proposition that indirect selling cases such as LNPPs when sales efforts reconciled to audited financial expenses must be allocated over sales last for years and yield only large sales statements and included expenses recognized for accounting purposes, at irregular intervals, the amount spent incurred in 1991–1992 by a facility then MRD maintains that it should use to negotiate a given group of sales may which is no longer in operation and, a period that encompasses the entire be greater than the total selling expenses therefore, are unrepresentative of LNPP industry cycle, i.e., a four-year incurred in the limited period in which current experience. period. the sales were made. Likewise, we note Furthermore, the petitioner argues With respect to the petitioner’s that significant sales efforts may be that the Department should remove the argument that the Department should made and significant selling expenses data pertaining to Canadian transactions remove the Canadian sales data from the may be incurred in a given period in the from the calculation of indirect selling calculation, MRD disagrees. It explains pursuit of a given sale without resulting expenses. According to the petitioner, that MRU sales personnel who are in the consummation of that sale. section 772(d)(1) of the Act allows responsible for sales in the United Contrary to the petitioner’s claim, adjustments to CEP only to reflect costs States are also responsible for sales in indirect selling expenses are period of selling the subject merchandise. Canada and Latin America, and that the expenses which cannot be associated Since purchases by Canadian customers expenses for these salesmen cannot be directly with specific sales and, are not subject to this investigation, the tied to specific sales or markets. therefore, no direct correlation is petitioner maintains that they cannot be Accordingly, the only possible possible despite the particular period used in the allocation of indirect selling allocation method is to divide the total chosen for analysis. expenses. Furthermore, MRD provided expenses of MRU’s sales personnel by Since our preliminary determination, no information illustrating that the the total value of the sales generated by we verified that the actual POI indirect selling expenses incurred on Canadian those personnel. selling expense rate was significantly sales are representative of those DOC Position: We agree in part with lower than that reported by the incurred on U.S. sales. both the petitioner and MRD. The respondent, as a result of the correction MRD maintains that the Department Department normally calculates indirect of clerical errors. See MRU Sales should allocate U.S. indirect selling selling expenses as a percentage of POI Verification Report at 22–24. Our expenses incurred during the POI over cost of goods sold or POI sales revenue analysis of the verified actual indirect the value of orders received during that recognized. See Final Determination of selling expenses incurred relative to the period, which would avoid the need to Sales at Less Than Fair Value: Certain verified sales revenue recognized for the apply a ‘‘cap’’ on such expenses as was Corrosion-Resistant Carbon Steel Flat two fiscal years captured by the POI done in the preliminary determination. Products and Certain Cut-to-Length does not indicate that application of the Alternatively, the Department should Carbon Steel Plate from Mexico, 58 FR verified POI rate would distort the revise the ‘‘cap’’ on U.S. indirect selling 37192, 37198 (July 9, 1993). In this case, calculation of CEP. Consequently, we expenses to avoid assigning the selling the respondent has argued since the see no need to cap these expenses for 38184 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices purposes of the final determination. representative of those incurred on U.S. supported by ‘‘benchmarks’’ based on Therefore, we have applied the verified sales. the actual costs for actual transactions. indirect selling expense percentage to The petitioner explains further that, at The respondent asserts that the U.S. sales contract prices (exclusive of verification, the Department examined a petitioner’s proposed calculation fails post-POI price amendments) and have warranty calculation provided by the that test and accordingly must be deducted the resulting expense amounts respondent (in Appendix 9 of the March rejected. from CEP. Given the nature of these 13, 1996 submission) that properly In addition, MRD argues that the expenses, it is not possible to segregate segregated U.S. and foreign sales. Department should revise its U.S. the selling expenses that relate to However, that calculation allocated four warranty calculation with respect to the foreign sales from those that relate to years of warranty expenses over contract Rochester, Wilkes-Barre and Fargo sales, U.S. sales. Therefore, we did not remove values that spanned a period of more so as to avoid double counting. MRD the data pertaining to these sales from than seven years, which in the asserts that the warranty calculation our calculation of the indirect selling petitioner’s opinion results in an methodology employed in the expense rate, as suggested by the understatement of the actual cost. preliminary determination for Rochester petitioner. Therefore, the petitioner suggests that and Wilkes-Barre was incorrect and Comment 6 General Methodology for the Department subtract from that unreasonable because it assumed that Calculating U.S. Warranty Expenses: warranty expense calculation both warranty services would be performed The petitioner maintains that the two Canadian sales, and sales revenues more than once, i.e., full warranty U.S. warranty expense calculations realized for the period prior to that for expenses were attributed to both MRD provided by MRD in its questionnaire which warranty expenses were reported. and MRU. According to MRD, whatever responses are flawed. The first one The petitioner argues that, unlike MRD’s warranty services are needed for these (contained in Appendix SC–21–A of the proposed calculations, its proposed presses will be performed only once— February 1, 1996 submission), which calculation is consistent with historical either by MRD, by MRU or a the Department used in its preliminary experience. combination thereof. Therefore, the determination, improperly included MRD argues that petitioner’s Department should either (1) apply only foreign sales data; and the second one proposition would result in a the MRD warranty expense rate to these (contained in Appendix 9 of the March mismatching of warranty costs and sales; (2) apply only the MRU warranty 13, 1996 submission), which was sales, and would massively overstate the expense rate to these sales; or (3) apply examined by the Department at actual warranty expenses MRU will an average of the MRD and MRU rates verification, improperly allocated four incur on sales during the POI. to these sales. With respect to Fargo, years of warranty expenses over more According to MRD, the purpose of the MRD argues that the Department’s than seven years of sales, thereby warranty calculation is to determine a preliminary calculations double- understating U.S. warranty costs. The reasonable estimate, based on an counted warranty expenses by adding petitioner contends that the Department analysis of historical data, of the the actual warranty expenses already should recalculate the MRU warranty warranty costs that will be incurred in incurred with the total expected expense rate to be applied to CEP based the future on the sales under warranty expenses. To estimate on historical data for a four-year period investigation. As such, the petitioner’s expected warranty expenses, MRD states exclusive of data pertaining to foreign proposed calculations do not meet that that one should use either the actual sales and inclusive of sales revenues purpose. With respect to the initial warranty expenses to date (plus an realized only during the period to which warranty expense calculation it reported estimate of the remaining warranty the warranty costs pertain. The based on historical experience, MRD expenses that are expected) or the petitioner explains that past Department contends that the removal of Canadian estimated total warranty expenses based decisions recognize that, especially on sales, as requested by the petitioner, on the value of the product. sales of large capital equipment such as would seriously distort the warranty DOC Position: We agree with both the LNPPs, the warranty expense calculations by leaving an petitioner and respondent, in part. The calculation must estimate future unrepresentative sample that would not Department’s normal practice in expenses based on historical costs, be sufficient to determine the historical computing warranty expenses is to use rather than capture current warranty ratio of warranty expenses to sales. MRD historical data over a four- or five-year costs, for U.S. sales, because the long points out that in its March 13, 1996 period preceding the filing of the time for production and installation submission, it provided a detailed petition to estimate the likely warranty may lead to warranty expenses incurred analysis that shows the actual warranty expenses on POI sales. The underlying long after the review period. expenses incurred on sales during the rationale for this practice is the The petitioner maintains further that last four years. Based on this review of recognition that, in many industries, the inclusion of sales to foreign MRU’s actual warranty expense warranty costs on sales made during the customers (i.e., sales to Canadian experience on sales for which complete POI might not occur until long after the customers) in the warranty expense rate warranty expense information is POI and, consequently, POI sales cannot calculation employed in the preliminary available, the respondent argues that the be tied to their associated actual determination is improper. According to U.S. warranty rate resulting from its warranty expenses for reporting the petitioner, section 772(d)(1) of the initial calculation (February 1, 1996 purposes. See Final Determination of Act allows adjustments to CEP only to submission) reasonably reflects MRU’s Sales at Less Than Fair Value: Bicycles reflect costs of selling the subject actual experience on sales for which the from the People’s Republic of China, 61 merchandise in the United States. Since warranty period has been completed. FR 19026, 19041 (April 30, 1996); Final purchases by Canadian customers are This analysis also demonstrates that Determination of Sales at Less Than not subject to investigation, the petitioner’s proposed calculation grossly Fair Value: Certain Carbon and Alloy petitioner maintains that they cannot be overestimates MRU’s actual warranty Steel Wire Rod from Canada, 59 FR used in the calculation of warranty experience. MRD notes that throughout 18791, 18795 (April 20, 1994); and Final expenses. Moreover, MRD provided no this proceeding the petitioner has Determination of Sales at Less Than evidence that the warranty expenses insisted that, before estimates can be Fair Value: Coated Groundwood Paper incurred on Canadian sales are used in this case, they must be from Finland, 56 FR 56363, 56379 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38185

(November 4, 1991). Historical costs are historical experience in Germany for all of this notice, we have not excluded the especially appropriate in the case of LNPP products. With respect to the Global sale from our final analysis. The LNPPs because the long time for Fargo and Global sales, MRD reported Global sale involved the sale of both a production and installation of the and the Department verified that MRU used press and new equipment. Used subject merchandise may lead to is primarily responsible for the servicing presses are expressly excluded from the warranty expenses being incurred long of any warranty claims on these sales. scope of our investigation. See ‘‘Scope after the POI. See Final Results of Therefore, for these sales it is more of Investigation’’ section of this notice. Administrative Review: Mechanical appropriate to use a warranty expense We also note that the value of the used Transfer Presses from Japan, 57 FR rate based on the historical experience equipment was identified separately in 12798, 12799 (April 13, 1992). of MRU as described above. Because we the contractual documentation Therefore, for purposes of the final have excluded the Charlotte sale from governing the sale. Given these facts, we determination, we have used the our analysis for the reasons stated in the have no basis upon which to include the warranty expense rate reported by the DOC Position to Comment 2 of the used equipment portion of the sale in respondent in its February 1, 1996 ‘‘Company-Specific Issues’’ subsection our final analysis as an integral part of submission, revised to reflect the of this notice, the issue is moot with the sale. As a result, we deducted from correction of certain clerical errors respect to this sale. the calculation of CEP the contract price found at verification. We have applied Comment 7 Global Sale: MRD relevant to the used equipment. This is this rate to the contract price of those asserts that, if the Department includes consistent with our treatment with U.S. POI sales for which MRU is the sale to Global in its analysis, it respect to spare and replacement parts, primarily responsible for providing should analyze the total sale, including which are also expressly excluded from warranty servicing, and then deducted the used merchandise that was an the scope and therefore excluded from the resulting amount from CEP. integral part of the sale. The respondent our analysis, where their value is As for the petitioner’s requested asserts that this sale was unusual in that separately outlined in the contractual removal from the calculation of the data it involved both new and used documentation. pertaining to non-subject sales, we agree equipment that was purchased by a Comment 8 Spare Parts: MRD in principle. While we have the reseller in the United States for ultimate requests that the Department adjust its information to segregate the warranty sale to the end user. MRD argues that calculations to avoid double-counting of costs that relate to these sales from those the new and used equipment was sold the cost of spare parts. MRD assert that that relate to U.S. sales in the as a package and the customer did not if the spare parts price is deducted from calculation, we do not have sufficient have the option of buying only the used the U.S. price, then the cost of the spare information to segregate the equipment or the new equipment at the parts should be excluded from CV. On corresponding sales values from the respective price stipulated in the sales the other hand, if the spare parts cost is calculation for two out of the four fiscal contract. MRD submits that in past included in the CV then the spare parts years included in the calculation. cases, the Department has ruled that, price should not be deducted from U.S. Therefore, given this problem and the where the contract sets a separate price price. fact that the warranty expense rate for non-integral, non-subject equipment, DOC Position: We agree. Consistent inclusive of the foreign sales reasonably it will rely on the contract price to with our preliminary determination, reflects MRU’s actual experience on determine the value to be assigned to where the value of the spare parts was sales whose warranty period has been that equipment. However, with respect separately identified in the contractual completed, we have not made the to the Global sale, MRD argues that the documentation governing the U.S. sale, adjustment proposed by the petitioner. used equipment in that sale was clearly we deducted the spare parts value from With respect to the respondent’s integral to the sale. As such, the the contract price in the calculation of argument that the Department should Department should make an adjustment CEP. In this case, we also excluded the revise its warranty expense calculation for that used equipment based on its cost of the spare parts from the CV. regarding Rochester, Wilkes-Barre and cost, and should allocate to it a portion Comment 9 Costs for Rochester and Fargo, we agree. In this case, both MRD of the total profit or loss on the sale. Wilkes-Barre Sales: MRD argues that the and MRU provide warranty services. The petitioner contends that MRD’s Department should calculate CV for the However, whether or not they incur failure to provide adequate information Rochester and Wilkes-Barre sales based warranty costs on a particular sale on the cost of the used equipment on costs calculated in accordance with depends on their role in the production requires the exclusion of the used the company’s project-specific work of the merchandise covered by the sale. equipment from the Department’s final plan. MRD contends that these costs are In the preliminary determination, we calculations on the basis of the contract accurate and reliable, and that they are incorrectly deducted from the CEP of price. The petitioner asserts that the cost based on a system used by the company the Rochester and Wilkes Barre sales of this equipment reflected the in its normal course of business. MRD warranty expenses reflecting the inventory value which was, in turn, states that it calculated the cost of each historical experience of MRU in based on the acquisition price plus project-specific work plan based on a addition to that of MRD, based on the shipping costs less salvage value. This project-specific bill of materials and assumption that both companies would does not yield the market value which, production instructions prepared before be playing a role in warranty servicing. according to the petitioner, is the correct the initiation of this investigation. Since that time, however, we verified measure of whether MRU received a MRD further asserts that it did not that MRD will be primarily responsible reasonable profit on the used mislead the Department regarding the for the warranty servicing on these merchandise. The petitioner also claims availability of actual cost data for LNPP systems, given that they were that MRD did not present information at completed press components. MRD almost entirely produced in Germany by verification to allow the Department to states that it was able to compare MRD. See MRD Sales Verification confirm the reported cost. project-specific work plan costs to the Report at 28. Therefore, for the DOC Position: We disagree with the actual costs recorded in its cost Rochester and Wilkes Barre sales, we respondent. For the reasons outlined in accounting system for certain home have applied the verified warranty DOC Position to Comment 2 of the market sales. MRD also notes that for expense rate relevant to MRD’s ‘‘Company-Specific Issues’’ subsection Rochester and a few home market sales, 38186 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices it was able to compare the project- characterization of its project-specific verification, however, we learned that specific work plan costs for individual work plan standard costing system as instead of including actual costs parts to the actual costs recorded in its the type of system routinely accepted by incurred to date for each project, MRD’s normal accounting system for the same the Department in past cases. The submitted costs for the Rochester and parts. petitioner asserts that the Department Wilkes-Barre sales were based entirely MRD maintains that if the Department only accepts such systems when an on the total standard costs calculated chooses to reject the costs calculated adjustment can be made to convert from the project-specific work plans. from the project-specific work plan for standard costs to actual costs. According Moreover, MRD’s project-specific Rochester and Wilkes-Barre, it should to the petitioner, MRD’s methodology standard costing system, which was the rely on the cost estimates submitted by does not allow any such adjustment. basis for its submitted costs, could not MRD as facts available rather than on For these reasons, the petitioner urges be reconciled to MRD’s audited the antidumping rate from the petition. the Department to rely on facts available financial statements. Absent the control According to MRD, the cost estimating or exclude these sales altogether from its of the respondent’s normal audited system calculates costs based on an final analysis. As facts available, the accounting system, we are unable to analysis of actual experience for petitioner suggests using the CV determine whether MRD’s projected previous projects of the same press information in the petition which it cost data for the Rochester and Wilkes- model. MRD argues that the petition rate argues contains the most probative facts Barre sales is reliable and accurate. does not contain MRD’s actual historical on the record. In addition to the difficulties noted experience regarding materials, labor DOC Position: We agree with the above in reconciling MRD’s project- and production operations which was petitioner that we cannot rely on MRD’s specific standard work plan costs for the considered in developing the submitted projected costs calculated from its Rochester and Wilkes-Barre sales, we cost estimates for the Rochester and project-specific work plans as the basis also found that the submitted costs for Wilkes-Barre sales. for CV in our final determination. The these projects had been derived after the The petitioner maintains that the Department normally requires initiation of this antidumping Department should reject the cost respondents to report the actual cost of investigation and calculated specifically figures reported for the Rochester and producing the subject product. Since the for the submission. MRD itself noted in Wilkes-Barre sales because the basis for Rochester and Wilkes-Barre sales were its case brief that the company these costs deviates from MRD’s normal not completed as of the date we issued calculated the detailed standard costing accounting practices and the reported the Section D questionnaire, MRD could of Rochester and Wilkes-Barre project- amounts were derived after initiation of not provide the actual cost of specific work plans after initiation of the investigation. The petitioner notes production. However, for these two this antidumping investigation. See June that verification revealed that MRD sales, the respondent urged the 13, 1996 Revised Case Brief at 62. created the project-specific standard Department to rely on its projected cost During verification, MRD officials also work plan costs for these sales solely for of production, which we normally do indicated that these same cost the purpose of responding to the not accept, because there were so few calculations had been prepared solely Department’s antidumping sales and there was concern as to for the purpose of providing CV questionnaire. Thus, according to the whether we would have any sales to information in this case. petitioner, the cost reporting investigate. MRD stated that its For these reasons, we have rejected methodology employed by the projected costs would be derived from MRD’s cost projections for the Rochester respondent for the Rochester and the company’s ‘‘standard costing and Wilkes-Barre sales in our final Wilkes-Barre sales presents significant performed in the normal course of determination, and have relied on facts potential for manipulation. Even if MRD business,’’ that substantial actual costs available to compute the cost of these could not manipulate the actual parts would be incurred by verification, and sales. As facts available, we used MRD’s listed in the work plan, the petitioner that such actual costs could be submitted cost estimates for each of the asserts that it is certainly possible for reconciled to the costs of each project- two sales. We adjusted the estimated MRD to have manipulated the cost of specific work plan. Because MRD urged cost for a cost variance amount which those parts. the Department to depart from its we calculated as the difference between The petitioner contends that MRD normal method of accepting only actual estimated and actual costs for sales of misled the Department about its method costs rather than projected costs, it was the same press model produced and of calculating production costs for these MRD’s responsibility to provide the data completed during the POI. unfinished sales. According to the necessary to justify the accuracy and We determined that the cost estimates petitioner, in making its decision reliability of its projected cost could be relied upon for several reasons. whether to review the Rochester and methodology. First, unlike the project-specific Wilkes-Barre sales as part of our As part of its CV submissions to the standard work plan costs submitted by investigation, the Department relied on Department, MRD explained its MRD for the Rochester and Wilkes-Barre MRD’s claims that, as part of reporting methodology for the Rochester sales, MRD prepares a cost estimate for verification, project-specific standard and Wilkes-Barre sales. Specifically, every press in the normal course of costs could be compared to actual costs MRD claimed that: ‘‘For those products business. Second, MRD completed the incurred to date on a component-by- for which production is not yet cost estimates for Rochester and Wilkes- component basis. The petitioner notes, complete but for which detailed work- Barre prior to the initiation of this case. however, that MRD was unable to plans are available (such as Rochester Third, MRD relied on its actual identify which components had been and Wilkes-Barre), the actual costs have production experience for the same completed and could not reconcile costs been used to determine the cost of model presses (‘‘Geoman’’) to develop actually incurred to the project-specific manufacture to date, and the standard cost estimates for similar Geoman work plan costs. In addition, during costs calculated from the project- presses included in the Rochester and verification, the Department found that specific work-plans have been used to Wilkes-Barre contracts. Lastly, MRD the projects were not completed to the determine the cost remaining for the provided estimated and actual cost data extent claimed by MRD. The petitioner project.’’ See MRD’s December 13, 1995 for the Geoman sales completed during also disagrees with MRD’s Section D response at 41. At the POI, thus enabling us to adjust Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38187 estimated costs for the Rochester and sale adjustment. Therefore, MRD argues and U.S. sale by recognizing both Wilkes-Barre sales based on MRD’s past that the imputed cost of financing financing costs incurred and payments experience with the same press model. production should be excluded from the received. Comment 10 Variances: MRD argues circumstance of sale credit calculation We agree with the petitioner that that the Department incorrectly used because the differences in the timing of SG&A should be included as production fiscal 1995 overhead variance rates to production costs do not affect price costs for calculating the imputed credit adjust overhead costs for the 1996 fiscal comparability. Additionally, MRD expense because the total contract price year. MRD contends that the asserts that negotiated payment terms for each press (sum of payments) Department should rely on the are not affected by the lengthy reflects the total production costs plus company’s reported variance figures production period for LNPPs. By linking profit. We disagree with the petitioner, which were based on actual partial-year the payment terms to the production however, with regard to the issue of variance rates for the first six months of cost schedules, as was done in the including imputed credit expense in fiscal 1996 and full-year budgeted preliminary determination, the CV. Section 773(e)(2)(A) of the Act, variance rates for the remainder of that Department contradicts the basic requires that the Department include in year. MRD maintains that its use of a principle that money is fungible. Thus, CV the actual amount of SG&A, budgeted variance for fiscal year 1996 MRD argues that progress payments and including net interest expense, incurred was actually conservative considering production costs should not be matched by the exporter or producer. We agree that the actual variance for the first half on a customer-specific basis. Also, MRD with the respondent’s position that of that year was more favorable than the maintains that imputed interest imputed credit is not an actual expense. budgeted amount. Lastly, MRD argues expenses should not be calculated for Therefore, we did not include imputed that the Department cannot possibly SG&A expenses. Moreover, the credit in the CV calculation for the final apply the prior year’s variance to the Department should only apply this determination. current period’s costs as it did in the circumstance of sale adjustment to NV Comment 12 Imputed Capitalized preliminary determination because the if the normal imputed credit is included Interest Costs: MRD claims that the variance for each period reflects the in the CV calculation. statute and German Generally Accepted utilization for that specific period. The petitioner asserts that the Accounting Principles (GAAP) do not The petitioner argues that the Department correctly made a allow imputed capitalized interest Department should continue to adjust circumstance of sale adjustment for expenses in the cost of manufacture. MRD’s costs to reflect the full year’s imputed credit expense by including Therefore, the Department should actual variance for fiscal 1995. The both production costs and progress include only the actual interest costs petitioner asserts that MRD’s budgeted payments in the calculation. In incurred rather than both actual variances do not accurately predict full- addition, the petitioner argues that financing and imputed capitalized year results and rely on potentially SG&A should be included in the interest expenses. MRD further argues unrealistic capacity utilization statistics. imputed credit expense calculation that the Department’s normal interest According to the petitioner, MRD’s because these costs are part of the total expense calculation already includes all comparison of budgeted and actual production costs compared to the total the actual costs of financing production. variances do not confirm the price of each press (i.e., total production MRD further argues that the interest cost reasonableness of either the actual or plus profit). Furthermore, the petitioner capitalized should not exceed the total budgeted variances reported. Moreover, agrees with MRD that the Department interest cost incurred by the company the petitioner maintains that the part- should deduct home market imputed and the Department should make an year variances may exclude year-end credit expenses as a circumstance of appropriate offset to the interest costs adjustments reflected in the annual sale adjustment only if they include included in general expenses. budgeted variance calculation. The imputed credit in CV. The petitioner contends that if the petitioner concludes that prior year’s DOC Position: We believe that it is Department does not include the timing actual experience provides a more appropriate in this instance to recognize of production costs as a factor in its accurate projection of fiscal 1996 actual the comprehensive financing credit calculation, it should include costs given the uncertainty about the arrangement for each sale as a capitalized interest expenses in CV to conflicting plant capacity and circumstance of sale adjustment. LNPPs reflect MRD’s financing of production utilization rates on the record. require substantial capital expenditures incurred prior to payments received. DOC Position: We agree with the over an extended time period because of DOC Position: Since we are petitioner that MRD’s budgeted their size and lengthy production calculating imputed interest as a variances do not accurately predict full- process (e.g., two to three years circumstance of sale adjustment and not year operating results and rely on including the design phase). Moreover, as a capitalized cost in the cost of unrealistic capacity utilization levels. In the projects generally call for the manufacture, this issue is moot. addition, year-end adjustments or one- purchaser to provide scheduled progress Comment 13 Combining MAN time annual costs may not be reflected payments before completion of a Plamag and MRD Production Costs: In in the part-year actual variance. project. Our normal imputed credit calculating cost of manufacturing, MRD Therefore, we rejected MRD’s reported calculation (i.e., cost of financing argues that the Department should part-year actual variance and budgeted receivables between shipment dates and average the labor and overhead rates of fiscal year variance calculation for fiscal payment dates) does not measure the both the MAN Plamag and MRD 1996. As an alternative, we relied on the effect of progress payments made facilities because LNPPs are produced at prior fiscal year actual variance which relative to production costs incurred. To both locations. Although MAN Plamag is consistent with the methodology adjust sales prices for the effect of the is a separate legal entity from MRD, applied in our the preliminary respondent incurring significant capital MRD contends that MAN Plamag meets determination. outlays at the beginning of a project the five criteria for collapsing Comment 11 Imputed Credit: MRD (back loaded payments) or receiving companies as used in Iron Construction contends that the Department’s normal large sums of money up front (front Castings from Canada, 59 FR 25603–04 practice is to include only differences in loaded payments), we calculated (May 17, 1994). Moreover, MRD selling expenses in the circumstance of imputed credit for each home market maintains that the Department’s policy 38188 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices is to average costs where management the cost of sales actually recognized from warehouse for consumption, on or has the capability to shift production during that period. If the Department after March 1, 1996, the date of between multiple facilities. Therefore, chooses to allocate G&A over sales publication of our preliminary the Department should include recognized, then MRD asserts that the determination in the Federal Register. respondent’s ‘‘multiple facilities’’ amount of G&A expenses should be Furthermore, we are also directing the adjustment which modifies the single capped. To calculate this cap, MRD U.S. Customs Service to continue to facility costs to reflect the average of the contends that actual G&A expenses suspend liquidation of all entries of two facilities. should be allocated between elements (parts or subcomponents) of The petitioner contends that, because commercial and newspaper presses components imported to fulfill a the two facilities do not produce the based on cost of goods sold during the contract for a LNPP system, addition or same models, MRD has not met the POI. component, from Germany, that are criteria for cost averaging. Even if MRD DOC Position: For the final entered, or withdrawn from warehouse had met the criteria for averaging costs, determination, we computed MRD’s on or after March 1, 1996, with the the petitioner argues that MRD’s further manufacturing G&A expense rate exception of those entries of elements calculation is inconsistent with based on the ratio of the reported G&A imported by MRU to fulfill the contract Department practice. MRD selectively expenses to cost of sales (less the cost for the sale of a LNPP system to The averaged labor and overhead rates, but of imported German parts recognized Charlotte Observer (‘‘Charlotte not SG&A expenses or research and during the POI). Consistent with the contract’’). Such suspension of development costs. The petitioner petitioner’s arguments, we applied this liquidation will remain in effect concludes that this selective form of G&A expense rate to the U.S. further provided that the sum of such entries weight averaging distorts costs and manufacturing costs of each press. G&A represent at least 50 percent of the should be rejected. expenses are period costs which relate value, measured in terms of the cost of DOC Position: We agree with the to activities of the company during the manufacture, of the subject component petitioner that we should not average period in which they are incurred. of which they are part. This costs for MRD and MAD Plamag. MAN Accordingly, we allocated G&A determination will be made by the Plamag is a separate corporate entity expenses over costs incurred during the Department only after all entries of the from MRD. Specifically, MAN Plamag is POI rather than the hypothetical cost of elements imported pursuant to a LNPP an affiliated party to MRD (not a orders received during the period. Based contract are made and the finished division or factory within MRD) which on our approach, we concluded capping product pursuant to the LNPP contract supplies MRD with one of the major of G&A was not necessary because the is produced. production inputs (RTPs). In total G&A assigned to all U.S. sales does For this determination, all foreign determining the cost of manufacturing, not exceed the total amount of G&A producers/exporters and U.S. importers the Department evaluates whether being allocated. in the LNPP industry be required to affiliated party transactions for major Comment 15 Loss on Plant Closure provide clearly the following inputs occur at prices that are arm’s and Disposal of Assets: MRD argues that information on the documentation length in nature and above the the loss on the closure of the Middlesex accompanying each entry from Germany supplier’s cost of production. Contrary and North Stonington facilities should of elements pursuant to a LNPP to MRD’s assertion, the Department’s be excluded from the cost calculation contract: (1) The identification of each normal practice is not to automatically because these costs were extraordinary. of the elements included in the entry, collapse affiliated suppliers and the In support of its position, MRD cites (2) a description of each of the elements, respondent company. In fact, the five Certain Welded Stainless Steel Pipe (3) the name of the LNPP component of criteria noted by MRD relate to from the Republic of Korea (57 FR which each of the elements are part, and collapsing companies for sales purposes 53693, 53704, November 12, 1992) in (4) the LNPP contract number pursuant rather than cost. which the Department excluded the to which the elements are imported. The Comment 14 Further Manufacturing gain of the sale of a manufacturing plant suspension of liquidation will remain in G&A: The petitioner maintains that the because the transaction was considered effect until such time as all of the Department should calculate an average extraordinary rather than a routine requisite information is presented to further manufacturing G&A expense disposal of fixed assets. U.S. Customs and the Department is over a multiple-year period based on The petitioner maintains that the able to make a determination as to actual historical data that reasonably costs incurred for the Middlesex plant whether the imported elements are at represents the costs incurred, and those closure should be included in MRD’s least 50 percent of the cost of yet to be incurred, by MRD from its further manufacturing G&A expense manufacture of the LNPP component of LNPP operations. The petitioner also calculation because this facility was the which they are part. urges the Department to ensure that the location of the newspaper press With respect to entries of LNPP spare denominator in its further division. and replacement parts, and used manufacturing G&A expense rate is DOC Position: The plant closure costs presses, from Germany, which are consistent with the allocation base of at issue were incurred prior to the POI. expressly excluded from the scope of each individual transaction to which the Because we calculated G&A expenses the investigation, we will instruct the rate is applied. Lastly, the petitioner based on POI data, this point is moot. Customs Service to continue not to contends that because MRD did not suspend liquidation of these entries if reconcile its submitted fiscal year 1992 Continuation of Suspension of they are separately identified and and 1993 G&A expenses to its audited Liquidation valued in the LNPP contract pursuant to financial statements, the Department In accordance with section which they are imported. should reject the G&A expenses 735(c)(1)(B) of the Act, we are directing In addition, in order to ensure that reported by MRD for those two years. the Customs Service to continue to our suspension of liquidation MRD argues that the Department suspend liquidation of all entries of instructions are not so broad as to cover should allocate further manufacturing LNPPs from Germany, as defined in the merchandise imported for non-subject G&A expenses over the cost of sales ‘‘Scope of Investigation’’ section of this uses, foreign producers/exporters and orders during the POI rather than over notice, that are entered, or withdrawn U.S. importers in the LNPP industry Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38189 shall continue to be required to provide [A±583±816] Atmospheric Administration (NOAA), certification that the imported Commerce. Certain Welded Stainless Steel Butt- merchandise would not be used to ACTION: Notice of public meeting. fulfill a LNPP contract. As indicated Weld Pipe Fittings from Taiwan, above, we will also continue to request Antidumping Duty Administrative SUMMARY: The Pacific Fishery that these parties register with the Review; Time Limits Management Council (Council) will hold a public meeting. Customs Service the LNPP contract AGENCY: Import Administration, numbers pursuant to which subject International Trade Administration, DATES: The meeting will be held on merchandise is imported. Department of Commerce. August 13, 1996, beginning at 10:30 a.m. ADDRESSES: The meetings will be held at The Customs Service shall require a ACTION: Notice of extension of time the Council office. cash deposit or posting of a bond equal limits. to the estimated amount by which the Council address: Pacific Fishery normal value exceeds the export price, SUMMARY: The Department of Commerce Management Council, 2130 SW Fifth as shown below. Any securities posted (the Department) is extending the time Avenue, Suite 224, Portland, OR 97201. since March 1, 1996, on entries of limits of the preliminary and final FOR FURTHER INFORMATION CONTACT: elements relevant to MRU’s Charlotte results of the second antidumping duty Lawrence D. Six, Executive Director; contract shall be refunded or canceled. administrative review of stainless steel telephone: (503) 326–6352. The weighted-average dumping butt-weld pipe fittings from Taiwan. SUPPLEMENTARY INFORMATION: A margins are as follows: The review covers one manufacturer/ Council-appointed ad hoc committee exporter of the subject merchandise to will discuss how to develop a system Weighted- the United States and the period June 1, that allows landing of groundfish in 1994 through May 31, 1995. excess of limits, the collection of the Exporter/manufacturer average margin per- EFFECTIVE DATE: July 23, 1996. funds by an appropriate organization, centage FOR FURTHER INFORMATION CONTACT: and the use of the funds for various fishery management and research MAN Roland Druckmaschinen Robert M. James at (202) 482–5222 or AG ...... 30.80 John Kugelman at (202) 482–5253, purposes. Koenig Bauer-Albert AG ...... 1 46.40 Antidumping and Countervailing Duty Special Accommodations All Others ...... 30.80 Enforcement Office Eight, Import These meetings are physically Administration, International Trade 1 Facts Available Rate. accessible to people with disabilities. Administration, U.S. Department of Requests for sign language The all others rate applies to all Commerce, 14th Street and Constitution interpretation or other auxiliary aids entries of subject merchandise except Avenue, N.W., Washington, DC 20230. should be directed to Eric W. Greene at for entries of merchandise produced by SUPPLEMENTARY INFORMATION: Because it (503) 326–6352 at least 5 days prior to the respondents listed above. is not practicable to complete this the meeting date. review within the time limits mandated International Trade Commission (ITC) Dated: July 17, 1996. by Section 751(a)(3)(A) of the Tariff Act Notification of 1930, as amended by the Uruguay Richard W. Surdi, Round Agreements Act of 1994, the Acting Director, Office of Fisheries In accordance with section 735(d) of Conservation and Management, National the Act, we have notified the ITC of our Department is extending the time limits for completion of the preliminary Marine Fisheries Service. determination. As our final [FR Doc. 96–18667 Filed 7–22–96; 8:45 am] determination is affirmative, the ITC results until July 29, 1996. See will determine, within 45 days, whether Memorandum from Joseph A. Spetrini BILLING CODE 3510±22±F these imports are causing material to Robert S. LaRussa, July 16, 1996, on injury, or threat of material injury, to an file in Room B–099 of the Main industry in the United States. If the ITC Commerce Building. We will issue our DEPARTMENT OF EDUCATION determines that material injury, or final results for this review by January [CFDA No. 84.133F] threat of material injury, does not exist, 29, 1997. the proceeding will be terminated and These extensions are in accordance Office of Special Education and all securities posted will be refunded or with Section 751(a)(3)(A) of the Tariff Rehabilitative Services; The National canceled. If the ITC determines that Act of 1930, as amended. Institute on Disability and such injury does exist, the Department Dated: July 16, 1996. Rehabilitation Research; Notice will issue an antidumping duty order Joseph A. Spetrini, Inviting Applications for New Awards Under Certain Programs for Fiscal directing Customs officials to assess Deputy Assistant Secretary, Antidumping and antidumping duties on all imports of the Countervailing Duty Enforcement. Year 1997 subject merchandise entered, or [FR Doc. 96–18675 Filed 7–22–96; 8:45 am] AGENCY: Department of Education. withdrawn from warehouse, for BILLING CODE 3510±DS±P ACTION: Correction notice. consumption on or after the effective date of the suspension of liquidation. SUMMARY: On July 1, 1996 a notice This determination is published National Oceanic and Atmospheric inviting applications for new awards pursuant to section 735(d) of the Act. Administration under certain programs for fiscal year 1997 was published in the Federal Dated: July 15, 1996. [I.D. 071696D] Register at 61 FR 34326. This notice Robert S. LaRussa, Pacific Fishery Management Council; corrects the maximum award amount Acting Assistant Secretary for Import Public Meeting for the Merit Research Fellowships in Administration. the July 1, 1996 Federal Register notice. [FR Doc. 96–18542 Filed 7–22–96; 8:45 am] AGENCY: National Marine Fisheries On page 34326 the table with BILLING CODE 3510±DS±P Service (NMFS), National Oceanic and information about Research Fellowships 38190 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices should indicate that the maximum electric energy. It does not own or Calpine is a power marketer authorized award amount for Merit Research control any electric generation or by the Federal Energy Regulatory Fellowships is $35,000. transmission facilities. Commission (FERC) to engage in FOR FURTHER INFORMATION CONTACT: DATES: Comments, protests or requests wholesale sale of electricity in interstate Dianne Villines, U.S. Department of to intervene must be submitted on or commerce at negotiated rates pursuant Education, Room 3417 Switzer before August 22, 1996. to its filed rate schedules. Building, 400 Maryland Avenue, SW., ADDRESSES: Comments, protests or The electric energy Calpine proposes Washington, DC 20202–2704. requests to intervene should be to transmit to Canada and Mexico will Telephone: (202) 205–9141. Individuals addressed as follows: Office of Coal & be purchased from electric utilities and who use a telecommunications device Electricity (FE–52) , Office of Fuels Federal power marketing agencies for the deaf (TDD) may call the TDD Programs. Office of Fossil Energy, within the United States. Calpine asserts number at (202) 205–8887. Department of Energy, 1000 that such energy will be surplus to the Authority: 29 U.S.C. 760–76. Independence Avenue, SW., system from which it purchases the Dated: July 17, 1996. Washington, DC 20585 (FAX 202–586– electric energy. In its applications, 0678). Judith E. Heumann, Calpine proposes to comply with Assistant Secretary for Special Education and FOR FURTHER INFORMATION CONTACT: procedures similar to those imposed by Rehabilitative Services. Warren E. Williams (Program Office) FE in the electricity export [FR Doc. 96–18559 Filed 7–22–96; 8:45 am] 202–586–9629 or Michael Skinker authorization issued to Enron Power (Program Attorney) 202–586–6667. BILLING CODE 4000±01±M Marketing, Inc. in Order No. EA–102 SUPPLEMENTARY INFORMATION: Exports of (February 6, 1996). Calpine further electricity from the United States to a agrees to abide by the export limits DEPARTMENT OF ENERGY foreign country are regulated and contained in the relevant export require authorization under section [Docket Nos. EA±116 and EA±117] authorizations associated with any 202(e) of the Federal Power Act (FPA) transmission system over which Calpine (16 U.S.C. 824a(e)). exports electric energy and to provide Application to Export Electricity, On July 1, 1996, Calpine filed two DOE with written evidence that Calpine Power Services Company applications with the Office of Fossil sufficient transmission access to Energy (FE) of the Department of Energy AGENCY: Office of Fossil Energy, DOE. complete the export transaction has ACTION: Notice of application. (DOE) for authorization to export electric energy, as a power marketer, to been obtained. SUMMARY: Calpine Power Services Mexico and Canada pursuant to section In Docket EA–116, Calpine proposes Company (Calpine) has submitted 202(e) of the FPA for a period of five to export the electric energy to Mexico applications to export electric energy to years. Calpine neither owns nor controls over one or more of the following Mexico and Canada pursuant to section any facilities for the transmission or international transmission lines for 202(e) of the Federal Power Act. Calpine distribution of electricity, nor does it which Presidential permits (PP) have is both a broker and a marketer of have a franchised service area. Rather, been previously issued:

Location Voltage Owner Permit

Miguel, CA ...... 230 kV ...... SDG&E ...... PP±68. Imperial Valley, CA ...... 230 kV ...... PP±79. Diablo, NM ...... 115 kV ...... El Paso Electric ...... PP±92. Ascarate, TX ...... 115 kV ...... PP±48. Brownsville, TX ...... 138 kV ...... CPL ...... PP±94. Eagle Pass, TX ...... 138 kV ...... CFE ...... PP±50. Laredo, TX ...... 138 kV ...... CFE ...... PP±57. Falcon Dam, TX ...... 138 kV ...... CFE ...... None.

In Docket EA–117, Calpine proposes over one or more of the following which Presidential permits (PP) have to export the electric energy to Canada international transmission lines for been previously issued:

Location Voltage Owner Permit

Tioga, ND ...... 230±kV ...... Basic Electric ...... PP±64. Blaine, WA ...... 2±500±kV ...... BPA ...... PP±10. Nelway, BC ...... 230±kV ...... PP±36. Nelway, BC ...... 230±kV ...... PP±46. Derby Line, VT ...... 120±kV ...... Citizens Utilities ...... PP±66. St. Clair, MI ...... 345±kV ...... Detroit Edison ...... PP±38. Maryville, MI ...... 230±kV ...... PP±21. Detroit, MI ...... 230±kV ...... PP±21. St Clair, MI ...... 345±kV ...... PP±58. Franklin, VT ...... 120±kV 1 ...... Joint Owners of the Highgate Project ...... PP±82. Houlton, ME ...... 345±kV ...... Maine Electric Power Co ...... PP±43. Arostock Cnty, ME ...... 138±kV ...... Maine Public Svs...... PP±29. Intnl Falls, MN ...... 115±kV ...... Minnesota Power ...... PP±78. Roseau Cnty, MN ...... 230±kV ...... Minnkota Power Corp ...... PP±61. Massena, NY ...... 2±230±kV ...... NYPA ...... PP±25. Devils Hole, NY ...... 230±kV ...... PP±30. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38191

Location Voltage Owner Permit

Massena, NY ...... 765±kV ...... PP±56. Niagara Falls, NY ...... 2±345±kV ...... PP±74. Devils Hole, NY ...... 230±kV ...... Niagara Mohawk ...... PP±30. Red River, ND ...... 230±kV ...... Northern States Power Co ...... PP±45. Roseau, MN ...... 500±kV ...... PP±63. Norton, VT ...... 450±kV DC ...... Vermont Electric Transmission Co ...... PP±76. 1 These facilities were constructed at 345±kV but operated at 120±kV.

Procedural Matters Issued in Washington, DC, on July 18, (202) 273–0873, and by e-mail at 1996. [email protected]. Any persons desiring to be heard or Anthony J. Como, SUPPLEMENTARY INFORMATION: to protest this application should file a Director, Office of Coal & Electricity, Office petition to intervene or protest at the of Fuels Programs, Office of Fossil Energy. Abstract address provided above in accordance [FR Doc. 96–18592 Filed 7–22–96; 8:45 am] The information collected under the with §§ 385.211 or 385.214 of the Rules BILLING CODE 6450±01±P requirements of FERC–583 ‘‘Annual of Practice and Procedure (18 CFR Kilowatt Generating Report (Annual 385.211, 385.214). Fifteen copies of Charges)’’ (OMB No. 1902–0136) is used such petitions and protests should be Federal Energy Regulatory by the Commission to implement the filed with the DOE on or before the date Commission statutory provisions of Section 10(e) of listed above. Comments on Calpine’s [FERC±583] the Federal Power Act (FPA), Part I, 16 request to export to Mexico should be U.S.C. 803(e) which requires the clearly marked with Docket No. EA– Proposed Information collection and Commission to collect annual charges 116. Comments on Calpine’s request to Request for Comments from hydropower licensees for, among export to Canada should be clearly other things, the cost of administering July 18, 1996. marked with Docket No. EA–117. Part I of the FPA and for the use of AGENCY: Federal Energy Regulatory Additional copies are to be filed directly United States dams. In addition, the Commission. with: Joseph E. Ronan, General Counsel, Omnibus Budget Reconciliation Act of ACTION: Calpine Power Services Company, 50 Notice of proposed information 1986 (OBRA) authorizes the collection and request for comments. West San Franando Street, San Jose, Commission to ‘‘assess and collect fees California 95113 and Jerry L. Pfeffer, SUMMARY: In compliance with the and annual charges in any fiscal year in Energy Industry Advisor, Skadden, requirements of Section 3506(c)(2)(a) of amounts equal to all of the costs Arps, Slate, Meadner & Flom, 1440 New the Paperwork Reduction Act of 1995 incurred by the Commission in that York Avenue, NW., Washington, DC (Pub. L. 104–13), the Federal Energy fiscal year.’’ The information is 20005–2107. Regulatory Commission (Commission) is collected annually and used to soliciting public comment on the determine the amount of annual charges A final decision will be made on this to be assessed licensees for reimbursable application after the environmental specific aspects of the information collection described below. government administrative costs and for impacts have been evaluated pursuant use of government dams. The DATES: Consideration will be given to to the National Environmental Policy Commission implements these filing comments submitted on or before Act of 1969 (NEPA), and a requirements in the Code of Federal September 23, 1996. determination is made by the DOE that Regulations (CFR) under 18 CFR the proposed action will not adversely ADDRESSES: Copies of the proposed Sections Part 11. impact on the reliability of the U.S. collection of information can be Action electric power supply system. obtained from and written comments may be submitted to the Federal Energy The Commission is requesting a three- Copies of this application will be Regulatory Commission, Attn: Michael made available, upon request, for public year extension of the current expiration P. Miller, Information Services Division, date, with no changes to the existing inspection and copying at the address ED–12.4, 888 First Street NE., collection of data. provided above. Washington, DC 20426. FOR FURTHER INFORMATION CONTACT: Burden Statement Michael P. Miller may be reached by Public reporting burden for this telephone at (202) 208–1415, by fax at collection is estimated as:

Number of Number of respondents responses Average burden hours per response Total annual burden hours per re- × × annually spondent (3) (1) (2) (3) (1) (2)

640 1 2 hours ...... 1,280 hours.

Estimated cost burden to respondents: The reporting burden includes the including: (1) reviewing instructions; (2) 1,280 hours/2,087 hours per year × total time, effort, or financial resources developing, acquiring, installing, and $102,000 per year = $62,558. expended to generate, maintain, retain, utilizing technology and systems for the disclose, or provide the information purposes of collecting, validating, 38192 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices verifying, processing, maintaining, e.g. permitting electronic submission of SUPPLEMENTARY INFORMATION: disclosing and providing information; responses. Abstract (3) adjusting the existing ways to Lois D. Cashell, comply with any previously applicable Secretary. The information collected under the requirements of FERC–582 ‘‘Oil, Gas instructions and requirements; (4) [FR Doc. 96–18621 Filed 7–22–96; 8:45 am] training personnel to respond to a and Electric Fees and Annual Charges’’ BILLING CODE 6717±01±M collection of information; (5) searching (OMB No. 1902–0132) is used by the data sources; (6) completing and Commission to implement the statutory reviewing the collection of information; provisions of the Omnibus Budget and (7) transmitting, or otherwise [FERC±582] Reconciliation Act of 1986, (Pub. L. 99– disclosing the information. 509) Title III, Subtitle E, Section 3401. The estimate of cost for respondents Proposed Information Collection and Congress directed the Commission ‘‘to is based upon salaries for professional Request for Comments assess and collect fees and annual and clerical support, as well as direct July 18, 1996. charges in any fiscal year in amount and indirect overhead costs. Direct costs AGENCY: Federal Energy Regulatory equal to all of the costs incurred by the include all costs directly attributable to Commission. Commission in that fiscal year.’’ The providing this information, such as Commission implements a program of ACTION: administrative costs and the cost for Notice of proposed information annual charges to be assessed against information technology. Indirect or collection and request for comments. interstate natural gas and oil pipelines, overhead costs are costs incurred by an SUMMARY: In compliance with the power marketing agencies, electric organization in support of its mission. requirements of Section 3506(c)(2)(a) of utilities and electric cooperatives. The These costs apply to activities which the Paperwork Reduction Act of 1995 Commission computes annual charges benefit the whole organization rather (Pub. L. No. 104–13), the Federal Energy based on information of adjusted sales than any one particular function or Regulatory Commission (Commission) is for resale and adjusted coordination of activity. soliciting public comment on the sales data. In addition the Commission Comments are invited on: (1) whether specific aspects of the information uses company financial information the proposed collection of information collection described below. filed under the waiver provisions to is necessary for the proper performance evaluate a company’s request for a DATES: Consideration will be given to of the functions of the Commission, waiver, or exemption, of the obligation comments submitted on or before including whether the information will to pay a fee for an annual charge. The September 23, 1996. have practical utility; (2) the accuracy of Commission implements these filing the agency’s estimate of the burden of ADDRESSES: Copies of the proposed requirements in the Code of Federal the proposed collection of information, collection of information can be Regulations (CFR) under 18 CFR Part including the validity of the obtained from and written comments 381 Sections 381.108 and 381.302 and methodology and assumptions used; (3) may be submitted to the Federal Energy Part 382 Section 382.201(b). ways to enhance the quality, utility and Regulatory Commission, Attn: Michael clarity of the information to be P. Miller, Information Services Division, Action collected; and (4) ways to minimize the ED–12.4, 888 First Street N.E., The Commission is requesting a three- burden of the collection of information Washington, D.C. 20426. year extension of the current expiration on those who are to respond, including FOR FURTHER INFORMATION CONTACT: date, with no changes to the existing the use of appropriate automated, Michael P. Miller may be reached by collection of data. electronic, mechanical, or other telephone at (202) 208–1415, by fax at Burden Statement: Public reporting technological collection techniques or (202)273–0873, and by e-mail at burden for this collection is estimated other forms of information technology [email protected]. as:

Number of Number of respondents responses Average burden hours per response Total annual burden hours per re- × × annually spondent (3) (1) (2) (3) (1) (2)

179 1 4 hours ...... 716 hours.

Estimated cost burden to respondents: instructions and requirements; (4) overhead costs are costs incurred by an 716 hours/2,087 hours per year × training personnel to respond to a organization in support of its mission. $102,000 per year = $34,993. collection of information; (5) searching These costs apply to activities which The reporting burden includes the data sources; (6) completing and benefit the whole organization rather total time, effort, or financial resources reviewing the collection of information; than any one particular function or expended to generate, maintain, retain, and (7) transmitting, or otherwise activity. disclose, or provide the information disclosing the information. Comments are invited on: (1) whether including: (1) reviewing instructions; (2) The estimate of cost for respondents the proposed collection of information developing, acquiring, installing, and is based upon salaries for professional is necessary for the proper performance utilizing technology and systems for the and clerical support, as well as direct of the functions of the Commission, purposes of collecting, validating, and indirect overhead costs. Direct costs including whether the information will verifying, processing, maintaining, include all costs directly attributable to have practical utility; (2) the accuracy of disclosing and providing information; providing this information, such as the agency’s estimate of the burden of (3) adjusting the existing ways to administrative costs and the cost for the proposed collection of information, comply with any previously applicable information technology. Indirect or including the validity of the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38193 methodology and assumptions used; (3) Company’s existing transmission [Docket No. RP96±253±002] ways to enhance the quality, utility and system. United Fuel Gas Company was clarity of the information to be a predecessor company of Columbia. Natural Gas Pipeline Company of America; Notice of Compliance Filing collected; and (4) ways to minimize the Columbia states that the proposed burden of the collection of information replacement will result in additional July 17, 1996. on those who are to respond, including capacity of approximately 9 Mdth/d Take notice that on July 11, 1996, the use of appropriate automated, which is included in Columbia’s Base Natural Gas Pipeline Company of electronic, mechanical, or other America (Natural) tendered for filing as technological collection techniques or Case Flow Diagrams for its Market Expansion Project pending with the part of its FERC Gas Tariff, Sixth other forms of information technology, Revised Volume No. 1, Substitute Fifth e.g. permitting electronic submission of Commission in Docket No. CP96–213– 000, et al. Revised Sheet No. 20 to become responses. effective July 1, 1996. Lois D. Cashell, Any person desiring to be heard or to Natural states that the purpose of this Secretary. make any protest with reference to said filing is to comply with the [FR Doc. 96–18622 Filed 7–22–96; 8:45 am] application should on or before August Commission’s order issued July 5, 1996 BILLING CODE 6717±01±M 2, 1996, file with the Federal Energy in Docket Nos. RP96–253–000 and Regulatory Commission, Washington, RP96–253–001. DC 20426, a motion to intervene or a Natural requests whatever waivers [Docket No. CP96±638±000] protest in accordance with the may be necessary to permit the tariff sheet submitted to become effective on Columbia Gas Transmission requirements of the Commission’s Rules July 1, 1996. Corporation; Notice of Application of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations Natural states that copies of the filing July 17, 1996. under the Natural Gas Act (18 CFR are being mailed Natural’s jurisdictional Take notice that on July 12, 1996, 157.10). All protests filed with the customers, interested state regulatory Columbia Gas Transmission Corporation Commission will be considered by it in agencies and all parties on the official service list in Docket Nos. RP96–253– (Columbia), a Delaware corporation, determining the appropriate action to be having its principal place of business at 000 and RP96–253–001. taken, but will not serve to make the Any person desiring to protest said 1700 MacCorkle Avenue, S.E., protestants parties to the proceedings. Charleston, West Virginia 25314–1599, filing should file a protest with the Any person wishing to become a party Federal Energy Regulatory Commission, filed an abbreviated application to a proceeding or to participate as a pursuant to Sections 7 (b) and (c) of the 888 First Street, N.E., Washington, D.C. party in any hearing therein must file a 20426, in accordance with Section Natural Gas Act, for the construction motion to intervene in accordance with and operation of approximately 5.2 385.211 of the Commission’s Rules and the Commission’s Rules. miles of 24-inch pipeline and Regulations. All such protests must be appurtenances replacing by Take further notice that, pursuant to filed as provided in Section 154.210 of abandonment 5.1 miles of 20-inch the authority contained in and subject to the Commission’s Regulations. Protests transmission pipeline and the jurisdiction conferred upon the will be considered by the Commission appurtenances. The facilities being Federal Energy Regulatory Commission in determining the appropriate action to replaced and abandoned are designated by Sections 7 and 15 of the Natural Gas be taken, but will not serve to make as a segment of Columbia’s Line KA, Act and Commission’s Rules of Practice protestants parties to the proceeding. located in Wyoming County, West and Procedure, a hearing will be held Copies of this filing are on file with the Virginia. without further notice before the Commission and are available for public inspection in the Public Reference The proposed construction is Commission or its designee on this Room. estimated to cost $7,049,000 and the application if no motion to intervene is cost of retirement is estimated to be filed within the time required herein, if Lois D. Cashell, $660,000. The associated estimated net the Commission on its own review of Secretary. debit to accumulated provision for the matter finds that a grant of the [FR Doc. 96–18576 Filed 7–22–96; 8:45 am] depreciation for the abandoned facilities certificate is required by the public BILLING CODE 6717±01±M is $900,229. convenience and necessity. If a motion Columbia states that section of Line for leave to intervene is timely filed, or KA to be replaced was originally [Docket No. RP96±260±001] if the Commission on its own motion constructed in 1931 as bare 20-inch believes that a formal hearing is Panhandle Eastern Pipe Line coupled pipeline and is part of Company; Notice of Compliance Filing Columbia’s larger KA pipeline system. required, further notice of such hearing Due to its age and condition, this will be duly given. July 17, 1996. section of pipeline has become Under the procedure herein provided Take notice that on July 12, 1996, physically deteriorated to the extent that for, unless otherwise advised, it will be Panhandle Eastern Pipe Line Company replacement is required in order to unnecessary for Columbia to appear or (Panhandle) tendered for filing as part of maintain service to Columbia’s existing be represented at the hearing. its FERC Gas Tariff, First Revised customers at current levels. Inspection Lois D. Cashell, Volume No. 1, the tariff sheets listed on of the facilities has confirmed evidence Secretary. Appendix A to its filing, to become of extensive corrosion and deterioration effective July 1, 1996. Panhandle asserts [FR Doc. 96–18571 Filed 7–22–96; 8:45 am] to the extent that replacement is that the purpose of this filing is to necessary to ensure safe and reliable BILLING CODE 6717±01±M comply with the Commission’s order operation. dated June 27, 1996 in Docket No. The KA system was originally RP96–260–000. authorized in Docket No. G–284 (3 FPC Panhandle states that this filing 941) as part of United Fuel Gas removes interest calculated prior to May 38194 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

31, 1996, the filing date, from the total customers and interested state Please affix Project No. 11374 to all amount of the Miscellaneous Stranded commissions. comments. For further information Costs to be recovered and recalculates Any person desiring to be heard or to please contact Mary Golato, the levelized interest component protest this filing should file a motion Environmental Coordinator, at (202) pursuant to Section 18.14 of to intervene or a protest with the 219–2804. Panhandle’s General Terms and Federal Energy Regulatory Commission, Lois D. Cashell, Conditions. The revised Second 888 First Street, N.E., Washington, D.C. Secretary. Miscellaneous Stranded Cost results in 20426, in accordance with sections [FR Doc. 96–18575 Filed 7–22–96; 8:45 am] no change in the surcharge applicable to 385.214 and 385.211 of the BILLING CODE 6717±01±W Rate Schedules FT, EFT, SCT and LFT, Commission’s Rules and Regulations. and a decrease in the volumetric All such motions or protests must be surcharge applicable to Rates Schedules filed as provided in Section 154.210 of [Docket Nos. CP96±52±000; CP96±134±000] IT and EIT from 0.11¢ to 0.10¢. the Commission’s Regulations. Protests Panhandle states that copies of this will be considered by the Commission Pine Needle LNG Company, LLC and filing are being served on all affected in determining the appropriate action to Transcontinental Gas Pipe Line customers, applicable state regulatory be taken, but will not serve to make Corporation; Notice of Availability of agencies and parties to this proceeding. protestants parties to the proceedings. the Environmental Assessment for the Any person desiring to protest this Any person wishing to become a party Proposed Pine Needle LNG Project filing should file a protest with the must file a motion to intervene. Copies July 17, 1996. Federal Energy Regulatory Commission, of this filing are on file with the The staff of the Federal Energy 888 First Street, NE., Washington, DC Commission and are available for public Regulatory Commission (FERC or 20426, in accordance with Section inspection in the Public Reference Commission) has prepared an 385.211 of the Commission’s Rules and Room. environmental assessment (EA) on the Regulations. All such protests must be Lois D. Cashell, liquefied natural gas (LNG) production filed as provided in Section 154.210 of Secretary. and storage project proposed in the the Commission’s Regulations. Protests above-referenced dockets. will be considered by the Commission [FR Doc. 96–18578 Filed 7–22–96; 8:45 am] BILLING CODE 6717±01±M The EA was prepared to satisfy the in determining the appropriate action to requirements of the National be taken, but will not serve to make Environmental Policy Act. The staff protestants parties to the proceeding. [Project No. 11374±001 Iowa] concludes that approval of the proposed Copies of this filing are on file with the project, with appropriate mitigating Butler County Conservation Board; Commission and are available for public measures, would not constitute a major Notice of Availability of Draft inspection in the Public Reference Federal action significantly affecting the Environmental Assessment Room. quality of the human environment. Lois D. Cashell, July 17, 1996. The EA assesses the potential Secretary. In accordance with the National environmental affects of the [FR Doc. 96–18577 Filed 7–22–96; 8:45 am] Environmental Policy Act of 1969 and construction and operation of Pine BILLING CODE 6717±01±M the Federal Energy Regulatory Needle LNG Company, LLC’s (Pine Commission’s (Commission’s) Needle) proposed LNG plant and related facilities in Stokesdale, North Carolina, [Docket No. RP96±311±000] regulations, 18 CFR Part 380 (Order No. including: 486, 52 F.R. 47897), the Office of • Williams Natural Gas Company; Notice Hydropower Licensing has reviewed the Two double-wall, suspended-deck of Proposed Changes in FERC Gas application for exemption from LNG storage tanks, each with a gas- Tariff licensing for the proposed Greene equivalent capacity of 2 billion cubic feet; Milldam Hydroelectric Project, located • July 17, 1996. on the Shell Rock River, Butler County, A pretreatment and liquefaction Take notice that on July 12, 1996 Iowa, and has prepared a Draft system with the capacity of 20 million Williams Natural Gas Company (WNG) Environmental Assessment (DEA) for cubic feet per day (MMcfd); tendered for filing to become part of its • A boiloff recompression system; the project. In the DEA, the • A vaporization and sendout system FERC Gas Tariff, Second Revised Commission’s staff has analyzed the Volume No. 1, the following tariff sheets with the capacity of 400 MMcfd; potential environmental impacts of the • to become effective August 12, 1996: About 1.0 mile of 10-inch-diameter project and has concluded that approval inlet pipeline; Third Revised Sheet No. 250A of the project, with appropriate • About 1.0 mile of 24-inch-diameter Second Revised Sheet No. 250B mitigation measures, would not outlet pipeline; and WNG states that this filing is being constitute a major federal action • An earthen dam and firewater made pursuant to Subpart C of part 154 significantly affecting the quality of the pond. of the Commission’s regulations. human environment. Transcontinental Gas Pipe Line WNG states that this filing is being Copies of the DEA are available for Corporation proposes to construct and made to specify another path in Article review in the Public Reference Branch, operate five taps on its mainline natural 13.3 on which WNG will assess a zero Room 2A, of the Commission’s offices at gas transmission system to connect with charge for the fuel component of its fuel 888 First Street, N.E., Washington, D.C. Pine Needle’s inlet and outlet pipelines. and loss reimbursement percentage. 20426. The purpose of the project is to Transportation from the specified Please submit any comments within provide winter peak heating service to receipt point to the specified delivery 30 days from the date of this notice. Pine Needle’s subscribers in the rapidly point on this second path constitutes a Comments should be addressed to Lois developing North Carolina region by the backhaul. D. Cashell, Secretary, Federal Energy 1999–2000 winter heating season. WNG states that a copy of its filing Regulatory Commission, 888 First The EA has been placed in the public was served on all jurisdictional Street, N.E., Washington, D.C. 20426. files of the FERC. A limited number of Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38195 copies of the EA are available for [Docket No. CP96±339±000] Proposed Facilities distribution and public inspection at: TPS does not propose any new Federal Energy Regulatory Commission, Total Peaking Services, L.L.C.; Notice of Intent To Prepare an Environmental facilities or any modifications to Public Reference and Files Maintenance Assessment for the Proposed Total existing facilities. The Milford LNG Branch, 888 First Street, NE., Room 1C– Peaking Services Milford LNG Project Plant would continue to be operated by 1, Washington, DC 20426, (202) 208– and Request for Comments on Southern Connecticut on behalf of TPS. 1371. The location of the Milford LNG Plant Environmental Issues 2 Copies of the EA have been mailed to is shown in appendix 1. Federal, state, and local agencies; public July 17, 1996. Land Requirements for Construction The staff of the Federal Energy interest groups; interested individuals; No additional land is required since Regulatory Commission (FERC or affected landowners; local libraries, TPS does not propose any additions or Commission) will prepare an newspapers, and radio stations; and modifications to the existing facility. other parties to this proceeding. environmental assessment (EA) that will discuss the environmental impacts of The EA Process Any person wishing to comment on the operation of facilities proposed in The National Environmental Policy the EA may do so. Written comments the Total Peaking Services Milford LNG must reference Docket No. CP96–52– Act (NEPA) requires the Commission to Project. This EA will be used by the take into account the environmental 000, and be addressed to: Office of the Commission in its decision-making impacts that could result from an action Secretary, Federal Energy Regulatory process to determine whether an whenever it considers the issuance of a Commission, 888 First Street, NE., environmental impact statement is certificate of public convenience and Washington, DC 20426. necessary and whether to approve the necessity. NEPA also requires us to Comments should be filed as soon as project.1 discover and address concerns the possible, but must be received no later Summary of the Proposed Project public may have about proposals. We than August 19, 1996 to ensure call this ‘‘scoping’’. The main goal of the consideration prior to a Commission Total Peaking Services, L.L.C. (TPS) is scoping process is to focus the analysis decision on this proposal. A copy of any seeking approval to acquire and operate in the EA on the important comments should also be sent to Mr. in interstate commerce an existing environmental issues. By this Notice of Michael Boyle, Environmental Project liquefied natural gas (LNG) peak- Intent, the Commission requests public shaving facility located in Milford, Manager, Room 72–59, at the above comments on the scope of the issues it Connecticut that is presently used by address. will address in the EA. All comments The Southern Connecticut Gas received are considered during the Comments will be considered by the Company (Southern Connecticut). The preparation of the EA. State and local Commission but will not serve to make purpose of the project is to enable TPS government representatives are the commentor a party to the to make interstate gas sales to satisfy the encouraged to notify their constituents proceeding. Any person seeking to Northeast’s growing demand for peaking of this proposed action and encourage become a party to the proceeding must gas. Southern Connecticut would them to comment on their areas of file a motion to intervene pursuant to sublease the Milford LNG Plant to CNE concern. Rule 214 of the Commission’s Rules of Energy Services Group, Inc. which in Because the LNG plant is an existing Practice and Procedures (18 CFR turn would sublease the plant to TPS. facility and no new additions or 385.214). Exisiting Facilities modifications are proposed, the EA will The date for filing timely motions to focus on the operation of the proposed The Milford LNG Plant was intervene in this proceeding has passed. project, the cryogenic design aspects of constructed in 1972 and consists of the plant, and the public safety Therefore, parties now seeking to file natural gas liquefaction, LNG storage, late interventions must show good including LNG trucking. and LNG revaporization facilities. The Prior to finalizing the EA, the FERC cause, as required by section plant was designed to supply Southern staff will meet with representatives of 385.214(b)(3), why this time limitation Connecticut’s gas utility needs by TPS (time and location to be noticed at should be waived. Environmental issues liquefying and storing natural gas in the a later date) to conduct a cryogenic have been viewed as good cause for late summer for revaporization during peak design and engineering review of the intervention. You do not need periods in the winter heating season. LNG facility at Milford, Connecticut. intervenor status to have your The Milford LNG Plant has a design Our independent analysis of the comments considered. liquefaction rate of 6 million cubic feet issues will be in the EA. Depending on Additional information about this per day (MMCFD) and a sendout the comments received during the project is available from Mr. Michael capacity of 72 MMCFD. The LNG is scoping process, the EA may be Boyle, Environmental Project Manager stored in a 348,000-barrel LNG storage published and mailed to Federal, State, at (202) 208–-0839. tank. and local agencies, public interest The Milford LNG Plant receives gas groups, interested individuals, affected Lois D. Cashell, for liquefaction and storage through landowners, newspapers, libraries, and Secretary. facilities of Southern Connecticut that the Commission’s official service list for [FR Doc. 96–18569 Filed 7–22–96; 8:45 am] are connected to the interstate pipeline this proceeding. A comment period will BILLING CODE 6717±01±M system of Iroquois Gas Transmission be allotted for review if the EA is System, L.P. The plant has also received significant amounts of LNG by transport 2 The appendices referenced in this notice are not trailer. being printed in the Federal Register. Copies are available from the Commission’s Public Reference and Files Maintenance Branch, 888 First Street, 1 Total Peaking Services’, L.L.C. application was NE., Washington, DC 20426, or call (202) 208–1371. filed under Section 7 of the National Gas Act and Copies of the appendices were sent to all those Part 157 of the Commission’s regulations. receiving this notice in the mail. 38196 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices published. We will consider all Notice of Amendment of License To 1. This notice also consists of the comments on the EA before we Relocate a Powerhouse following standard paragraphs; B, C1, recommend that the Commission and D2. approve or not approve the project. July 17, 1996. b. Comments, Protests, or Motions to Take notice that the following Intervene—Anyone may submit Public Participation hydroelectric application has been filed comments, a protest, or a motion to You can make a difference by sending with the Commission and is available intervene in accordance with the a letter addressing your specific for public inspection: requirements of Rules of Practice and comments or concerns about the project. a. Type of Application: Amendment Procedure, 18 CFR 385.210, .211, .214. You should focus on the potential of License to Relocate a Powerhouse. In determining the appropriate action to environmental effects of the proposal, b. Project No.: 1933–011. take, the Commission will consider all alternatives to the proposal, and c. Dated filed: July 1, 1996. protests or other comments filed, but measures to avoid or lessen d. Applicant: Southern California only those who file a motion to environmental impact. The more Edison Company. intervene in accordance with the specific your comments, the more useful Commission’s Rules may become a e. Name of Project: Santa Ana River they will be. Please follow the party to the proceeding. Any comments, No. 1 & No. 2 Project. instructions below to ensure that your protests, or motions to intervene must comments are receive and properly f. Location: Near the mouth of the be received on or before the specified recorded: Santa Ana River Canyon, in San comment date for the particular • Address your letter to: Lois Cashell, Bernadino County, California. application. Secretary, Federal Energy Regulatory g. Filed pursuant to: Federal Power C1. Filing and Service of Responsive Commission, 888 First St., NE., Act, 16 U.S.C. § 791(a)–825(r). Documents—Any filings must bear in Washington, DC 20426; h. Applicant Contact: Mr. Bryant C. all capital letters the title • Reference Docket No. CP96–339– Danner, Vice President and General ‘‘COMMENTS’’, 000; Counsel, Southern California Edison • ‘‘RECOMMENDATIONS FOR TERMS Send a copy of your letter to: Mr. Company, P.O. Box 800, 2244 Walnut AND CONDITIONS’’, ‘‘PROTEST’’, OR James Dashukewich, EA Project Grove Avenue, Rosemead, CA 91770, ‘‘MOTION TO INTERVENE’’, as Manager, Federal Energy Regulatory (818) 302–4459. applicable, and the Project Number of Commission, 888 First St., NE., Room i. FERC Contact: Mohamad Fayyad, the particular application to which the 72–56, Washington, DC 20426; and (202) 219–2665. filing refers. Any of the above-named • Mail your comments so that they j. Comment Date: August 26, 1996. documents must be filed by providing are received in Washington, DC on or the original and the number of copies before August 14, 1996. k. Description of Amendment: In a June 12, 1995 amendment application, provided by the Commission’s Becoming an Intervenor the licensee proposed to relocate a water regulations to: The Secretary, Federal In addition to involvement in the EA conveyance flume, and relocate the Energy Regulatory Commission, 888 scoping process, you may want to Santa Ana No. 2 powerhouse (SAR2). First Street, N.E., Washington, D.C. become an official party to the The amendment is necessary because 20426. A copy of any motion to proceeding or an ‘‘intervenor’’. Among the facilities will be inundated by intervene must also be served upon each other things, intervenors have the right construction of the Corps of Engineers’ representative of the Applicant to receive copies of case-related Seven Oaks Dam. The licensee has specified in the particular application. Commission documents and filings by revised its application to reflect D2. Agency Comments—Federal, other intervenors. Likewise, each refinements in its engineering analysis state, and local agencies are invited to intervenor must provide copies of its as follows: file comments on the described filings to all other parties. If you want —The original proposal consisted of application. A copy of the application to become a intervenor, you must file a replacing the flume with a buried may be obtained by agencies directly motion to intervene according to Rule pipeline beneath an access road along from the Applicant. If an agency does 214 of the Commission’s Rules of the mountainside leading to the top of not file comments within the time Practice and Procedure (18 CFR the Seven Oaks Dam. Now, the specified for filing comments, it will be 385.214) (see appendix 2). licensee wishes to relocate the presumed to have no comments. One Filing of timely motions to intervene pipeline to the canyon floor through copy of an agency’s comments must also in this proceeding should be made on or the dam construction area. Because of be sent to the Applicant’s before July 24, 1996. Once this date has the new location, the pipeline must be representatives. passed, parties seeking to file late constructed before October 1997 Lois D. Cashell, interventions must show good cause, as which is when the Corps’ dam Secretary. required by section 385.214(b)(3), why construction will potentially subject [FR Doc. 96–18572 Filed 7–22–96; 8:45 am] this time limitation should be waived. the existing flume to inundation BILLING CODE 6717±01±M Environmental issues have been viewed —The original proposal included as good cause for late intervention. You moving SAR2 powerhouse about 2 do not need intervenor status to have miles downstream from its existing Notice of Amendment of License your scoping comments considered. location. Now, the licensee proposes July 17, 1996. Additional information about the to combine SAR2 with the proposed project is available from Mr. Take notice that the following powerhouse of the Santa Ana No. 3 hydroelectric application has been filed James Dashukewich, EA Project Project (FERC No. 2198) and include Manager, at (202) 208–0117. with the Commission and is available its features. The new powerhouse will for public inspection: Lois D. Cashell, contain one generating unit with an a. Type of Application: Amendment Secretary. installed generating capacity of 4 MW. of license. [FR Doc. 96–18570 Filed 7–22–96; 8:45 am] The hydraulic capacity of the b. Project No: 8296–043. BILLING CODE 6717±01±M powerhouse will not change c. Date Filed: May 30, 1996. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38197

d. Applicant: Malacha Hydro Limited intervene must also be served upon each recreational opportunities in the area. Partnership. representative of the Applicant Comments on the need for scheduled e. Name of Project: Muck Valley specified in the particular application. two-turbine releases for whitewater Hydroelectric Project. D2. Agency Comments—Federal, boating and how such releases could f. Location: Lassen County, Nubieber, state, and local agencies are invited to affect public safety are requested by this California. file comments on the described notice. g. Filed Pursuant to: Federal Power application. A copy of the application Act, 16 U.S.C. Section 791(a)–825(r). may be obtained by agencies directly 1. This notice also consists of the h. Applicant Contact: Mr. E. Robert from the Applicant. If an agency does following standard paragraphs: B, C1, Mooney, Malacha Hydro Limited not file comments within the time and D2. Partnership, P.O. Box 6437, Boise, ID specified for filing comments, it will be B. Comments, Protests, or Motions to 83707, (208) 338–2603. presumed to have no comments. One Intervene—Anyone may submit i. FERC Contact: Susan Tseng, (202) copy of an agency’s comments must also comments, a protest, or a motion to 219–2798. be sent to the Applicant’s intervene in accordance with the j. Comment Date: August 23, 1996. representatives. k. Description of Project: The licensee requirements of Rules of Practice and proposes to install either a pneumatic Lois D. Cashell, Procedure, 18 CFR 385. 210, .211, .214. crest gate or similar type inflatable Secretary. In determining the appropriate action to rubber dam apparatus on the crest of the [FR Doc. 96–18573 Filed 7–22–96; 8:45 am] take, the Commission will consider all existing diversion weir and replace the BILLING CODE 6717±01±M protests or other comments filed, but steel trashracks with high-density only those who file a motion to polyethylene (HDPE) racks. The gate or intervene in accordance with the rubber dam will extend 3.0 feet above Notice of Proceeding Pursuant to Commission’s Rules may become a the existing weir crest and increase the Article 408 Regarding Amendment of party to the proceeding. Any comments, existing reservoir pool by 2.5 feet and License for Whitewater Boating protests, or motions to intervene must allow for 0.5 feet of freeboard. The July 17, 1996. be received on or before the specified increase in the pool depth will also Take notice that the following comment date for the particular increase the total cross sectional area of hydroelectric application has been filed application. flow through the trashrack into the with the Commission and is available C1. Filing and Service of Responsive intake by 36%. The HDPE racks would for public inspection: 1 Documents—Any filings must bear in have a bar spacing of ⁄2 inch instead of a. Type of Application: Proceeding 3 all capital letters the title the existing ⁄8 inch spacing. Pursuant to Article 408 Regarding 1. This notice also consists of the ‘‘COMMENTS’’, Amendment of License For Whitewater ‘‘RECOMMENDATIONS FOR TERMS following standard paragraphs: B, C1, Boating. and D2. AND CONDITIONS’’, ‘‘PROTEST’’, OR a. Project No: 9690–025. ‘‘MOTION TO INTERVENE’’, as B. Comments, Protests, or Motions to c. License Issued: April 14, 1992. Intervene—Anyone may submit d. Applicant: Orange and Rockland applicable, and the Project Number of comments, a protest, or a motion to Utilities, Inc. the particular application to which the intervene in accordance with the e. Name of Project: Rio Project. filing refers. Any of the above-named requirements of Rules of Practice and f. Location: Mongaup River in Orange documents must be filed by providing Procedure, 18 CFR 385.210, .211, .214. and Sullivan Counties, New York. the original and the number of copies In determining the appropriate action to g. Filed Pursuant to: Federal Power provided by the Commission’s take, the Commission will consider all Act, 16 U.S.C. 791 (a)–825 (r) and regulations to: The Secretary, Federal protests or other comments filed, but Article 408 of project license. Energy Regulatory Commission, 888 only those who file a motion to h. Applicant Contact: Mr. Hans First Street, N.E., Washington, D.C. intervene in accordance with the Hasnay, Orange and Rockland Utilities, 20426. A copy of any motion to Commission’s Rules may become a Inc., One Blue Hill Plaza, Pearl River, intervene must also be served upon each party to the proceeding. Any comments, NY 10965 (914) 577–2648. representative of the Applicant protests, or motions to intervene must i. FERC Contact: Heather Campbell, specified in the particular application. be received on or before the specified (202) 219–3097. comment date for the particular j. Comment Date: August 23, 1996. D2. Agency Comments—Federal, application. k. Description of Proposal: The state, and local agencies are invited to C1. Filing and Service of Responsive Commission staff is considering revising file comments on the described Documents—Any filings must bear in the approved whitewater boating release application. A copy of the application all capital letters the title schedule to provide for scheduled two- may be obtained by agencies directly ‘‘COMMENTS’’, turbine releases. These two-turbine from the Applicant. If an agency does ‘‘RECOMMENDATIONS FOR TERMS releases are currently taking place at the not file comments within the time AND CONDITIONS’’, ‘‘PROTESTS’’, OR discretion of the licensee when ample specified for filing comments, it will be ‘‘MOTION TO INTERVENE’’, as water is present. presumed to have no comments. One applicable, and the Project Number of Preliminary comments on the possible copy of an agency’s comments must also the particular application to which the revision from the Upper Delaware be sent to the Applicant’s filing refers. Any of the above-named Council, National Park Service, and representatives. documents must be filed by providing various kayaking and canoeing groups Lois D. Cashell, the original and the number of copies have identified complex issues provided by the Commission’s involving recreational use and public Secretary. regulations to: The Secretary, Federal safety. This proceeding is to determine [FR Doc. 96–18574 Filed 7–22–96; 8:45 am] Energy Regulatory Commission, 888 if an amendment to the approved BILLING CODE 6717±01±M First Street, N.E., Washington, D.C. whitewater boating schedule is 20426. A copy of any motion to appropriate for the enhancement of 38198 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Office of Hearing and Appeals Under DOE procedural regulations, 10 receipt by an aggrieved person of actual CFR Part 205, any person who will be notice, whichever occurs first. All such Notice of Cases Filed During the Week aggrieved by the DOE action sought in comments shall be filed with the Office of April 8 Through April 12, 1996 these cases may file written comments of Hearings and Appeals, Department of During the Week of April 8 through on the application within ten days of Energy, Washington, D.C. 20585–0107. April 12, 1996, the appeals and service of notice, as prescribed in the Dated: July 12, 1996. procedural regulations. For purposes of applications for other relief listed in the George B. Breznay, Appendix to this Notice were filed with the regulations, the date of service of Director, Office of Hearings and Appeals. the Office of Hearings and Appeals of notice is deemed to be the date of the Department of Energy. publication of this Notice or the date of

LIST OF CASES RECEIVED BY THE OFFICE OF HEARINGS AND APPEALS [Week of April 8 Through April 12, 1996]

Name and location of Date applicant Case No. Type of submission

4/9/96 ...... Garvie Marks Gulf, Carrollton, Georgia ...... RR300±282 Request for Modification/Rescission in the Gulf Oil Refund Proceeding. If granted: The Jan- uary 30, 1996 Dismissal in Case No. RF300±21406 issued to Garvie Marks Gulf would be modified regarding the firm's application for refund submitted in the Gulf Oil refund proceeding. 4/9/96 ...... Mercury Fuel Service, Inc., Waterbury, Con- VEE±0020 Exception to the Reporting Requirements. If necticut. granted: Mercury Fuel Service, Inc. would not be required to file Form EIA±782B Re- seller's/Retailer's Monthly Petroleum Prod- ucts Sales Report. 4/9/96 ...... Oakland Operations Office, Oakland, Califor- VSO±0088 Request for Hearing under 10 CFR Part 710. nia. If granted: An individual employed at Oak- land Operations Office would receive a hearing under 10 CFR Part 710. 4/9/96 ...... Oakland Operations Office, Oakland, Califor- VSO±0089 Request for Hearing under 10 CFR Part 710. nia. If granted: An individual employed at Oak- land Operations Office would receive a hearing under 10 CFR Part 710. 4/9/96 ...... Schenectady Naval Reactors, Schnenectady, VSO±0090 Request for Hearing under 10 CFR Part 710. New York. If granted: An individual employed at Sche- nectady Naval Reactors Office would receive a hearing under 10 CFR Part 710. 4/10/96 ...... Tonka Products Div. of Tonka Corp., Paw- RR272±236 Request for Modification/Rescission in the tucket, Rhode Island. Crude Oil Refund Proceeding. If granted: The March 20, 1996 Dismissal in Case No. RF272±78126 issued to Tonka Products Div. Of Tonka Corp. would be modified regarding the firm's application for refund submitted in the Crude Oil refund proceeding.

REFUND APPLICATION RECEIVED

Date received Name of refund proceeding/name of refund applicant Case No.

4/8/96 thru 4/12/96 ...... Crude Oil Supplemental Refunds ...... RK272±3487 thru RK272±3492.

[FR Doc. 96–18593 Filed 7–22–96; 8:45 am] were filed with the Office of Hearings notice is deemed to be the date of BILLING CODE 6450±01±P and Appeals of the Department of publication of this Notice or the date of Energy. receipt by an aggrieved person of actual Under DOE procedural regulations, 10 notice, whichever occurs first. All such Notice of Cases Filed; Week of April 1 CFR Part 205, any person who will be comments shall be filed with the Office Through April 5, 1996 aggrieved by the DOE action sought in of Hearings and Appeals, Department of these cases may file written comments Energy, Washington, D.C. 20585–0107. During the Week of April 1 through on the application within ten days of April 5, 1996, the appeals and service of notice, as prescribed in the Dated: July 12, 1996. applications for exception or other relief procedural regulations. For purposes of George B. Breznay, listed in the Appendix to this Notice the regulations, the date of service of Director, Office of Hearings and Appeals. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38199

LIST OF CASES RECEIVED BY THE OFFICE OF HEARINGS AND APPEALS [Week of April 1 Through April 5, 1996]

Date Name and location of applicant Case No. Type of submission

April 2, 1996 ...... Chuck Dahlem Texaco Service, Wichita, Kansas ..... RR321±195 Request for Modification/Rescission in the Texaco Refund Proceeding. If granted: The July 29, 1993 Decision and Order (Case No. RF321±16802) issued to Chuck Dahlem Texaco Service would be modified regarding the firm's application for refund submitted in the Texaco refund proceeding. Do ...... Dianna McNew, Baltimore, Maryland ...... VFA±0146 Appeal of an information request denial. If granted: The January 23, 1996 Freedom of Information Request Denial issued by the Department of En- ergy, Oak Ridge Operations Office would be rescinded, and Dianna McNew would receive access to certain Department of Energy information. Do ...... Glen M. Jameson, Lakewood, Colorado ...... VFA±0147 Appeal of an information request denial. If granted: The March 5, 1996 Freedom of Information Re- quest Denial issued by the Department of Energy, Oak Ridge Office would be rescinded and Glen M. Jameson would receive access to certain De- partment of Energy information. Do ...... Industrial Constructors Corp., Missoula, Montana ..... VFA±0144 Appeal of an information request denial. If granted: The March 15, 1996 Freedom of Information Re- quest Denial issued by the Department of Energy, Albuquerque Operations Office would be rescinded, and Industrial Constructors Corp. would receive access to certain Department of Energy information. Do ...... Stoel Rives LLP, Portland, Oregon ...... VFA±0145 Appeal of an information request denial. If granted: The March 8, 1996 Freedom of Information Re- quest Denial issued by the Department of Energy, Bonneville Power Administration would be rescinded, and Stoel Rives LLP would receive access to certain Department of Energy information. April 3, 1996 ...... William H. Payne, Albuquerque, New Mexico ...... VFA±0148 Appeal of an information request denial. If granted: The March 21, 1996 Freedom of Information Re- quest Denial issued by Sandia National Labora- tories would be rescinded, and William H. Payne would receive access to certain DOE information. April 4, 1996 ...... New York Times, Memphis, Tennessee ...... RR272±235 Request for modification/rescission in the crude oil refund proceeding. If granted: The February 26, 1996 Dismissal (Case No. RF272±78117) issued to New York Times would be modified regarding the firm's application for refund submitted in the Crude Oil refund proceeding. Do ...... Providence Journal Company, Memphis, Tennessee RR272±234 Request for modification/rescission in the crude oil refund proceeding. If granted: The February 28,1996 Dismissal (Case No. RF272±78127) issued to Providence Journal Company would be modified regarding the firmn's application for refund submitted in the Crude Oil refund proceeding. April 5, 1996 ...... Honeywell, Inc., Phoenix, Arizona ...... VFA±0149 Appeal of an information request denial. If granted: The February 23, 1996 Freedom of Information Request Denial issued by Oak Ridge Operations Office would be rescinded, and Honeywell, Inc. would receive access to certain DOE information.

REFUND APPLICATIONS RECEIVED [Week of April 1 to April 5, 1996]

Name of refund proceeding/name of refund Date received applicant Case No.

4/1/96 thru 4/5/96 ...... Crude Oil Supplemental Refunds ...... RK272±3474 thru RK272±3486. 38200 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

[FR Doc. 96–18595 Filed 7–22–96; 8:45 am] To facilitate the reading of comments business on the comment closing date of BILLING CODE 6450±01±P relating to a particular issue, July 25, 1996 to be assured of commenters are requested to divide consideration. their comments into two different Subsequent to the July 10 and 11, DEPARTMENT OF TRANSPORTATION sections: (1) Safety and regulatory 1996 public meetings, NHTSA received process; and (2) Environment. requests for extension of the period for National Highway Traffic Safety FOR FURTHER INFORMATION CONTACT: submitting written comments on the Administration NHTSA: Mr. Stanley C. Feldman, Office notice from Consumers Union and of Chief Counsel, NHTSA, 400 Advocates for Highway and Auto Safety. ENVIRONMENTAL PROTECTION A copy of each request has been placed AGENCY Seventh Street, S.W., Washington, D.C. 20590 telephone (202–366– in NHTSA’s docket at Docket No. 96–43, [Docket No. 96±43; Notice 2] 5265), fax (202–366–3820) Notice 1. Both Consumers Union and EPA: Kenneth E. Feith, Office of Air and Advocates for Highway and Auto Safety International Regulatory Radiation, U.S. Environmental indicted that they wish to file Harmonization, Motor Vehicle Safety; Protection Agency, 401 M St., SW., substantive written comments on these Motor Vehicles and Motor Vehicle Washington, DC 20460, telephone issues but can only do so if the Engines and the Environment (202–260–4996), fax (202–260–9766). comment deadline of July 25, 1996, is AGENCY: National Highway Traffic SUPPLEMENTARY INFORMATION: In the June extended substantially, or until October Safety Administration (NHTSA), DOT; 17, 1996 (61 FR 30657) Federal 1, 1996. After reviewing these requests, Environmental Protection Agency Register, NHTSA and EPA published a NHTSA agrees that commenters need (EPA). joint notice requesting written more time to formulate their responses given the complexity of the issues ACTION: Extension of comment period. comments and announcing two public meetings, held on July 10 and 11, 1996, involved. SUMMARY: On June 17, 1996, NHTSA to seek comments on recommendations Accordingly, the period for and EPA published a joint notice in the by the U.S. and European automotive submitting written comments, originally Federal Register requesting written industry for actions by the U.S. scheduled to end July 25, is extended to comments and announcing two public European Union (EU) governments October 1, 1996. meetings regarding recommendations by concerning international harmonization Issued on: July 17, 1996. the U.S. and European automotive of motor vehicle safety and Frank Turpin, industry for actions by the U.S. and environmental regulation, the Director, NHTSA Office of International European Union governments. These intergovernmental regulatory process Harmonization. industry recommendations, made at the necessary to achieve such [FR Doc. 96–18693 Filed 7–22–96; 8:45 am] Transatlantic Automotive Industry harmonization, and coordination of BILLING CODE 4915±00±M Conference on International Regulatory, vehicle safety and environmental concern the international harmonization research. The industry of motor vehicle safety and recommendations were made at the FEDERAL COMMUNICATIONS environmental regulation, the Transatlantic Automotive Industry COMMISSION intergovernmental regulatory process Conference on International Regulatory necessary to achieve such Harmonization, held in Washington, Public Information Collections harmonization, and the coordination of D.C., on April 10–11, 1996. NHTSA and related motor vehicle safety and Approved by Office of Management EPA requested public comments to and Budget environmental research. NHTSA and facilitate their making informed EPA requested public comments to decisions about their responses to the July 17, 1996. facilitate their making informed industry recommendations as well as to The Federal Communications decisions about their responses to the ensure that all interested parties were Commission (FCC) has received Office industry recommendations as well as to made aware of ongoing activity in the of Management and Budget (OMB) ensure that all interested parties were area of international harmonization of approval for the following public made aware of ongoing activity in the motor vehicle safety and environmental information collections pursuant to the area of international harmonization of regulations. Paperwork Reduction Act of 1995, motor vehicle safety and environmental The notice discussed the background Public Law 104–13. An agency may not regulations. In response to two requests that led to the Washington Conference, conduct or sponsor and a person is not for an extension of the period for the industry principles and required to respond to a collection of submitting written comments, NHTSA recommendations for current and future information unless it displays a and EPA have decided to extend the harmonization actions needed by the currently valid control number. For comment deadline from July 25, 1996 to U.S. and EU in three specific areas (i.e., further information contact Shoko B. October 1, 1996. regulatory process, safety, and the Hair, Federal Communications DATES: Written Comments: All written environment), and U.S. government Commission, (202) 418–1379. comments on the June 17, 1996 request statements concerning the goal of for comments, Docket 96–43, Notice 1, harmonization of existing and future Federal Communications Commission must be received by NHTSA’s docket motor vehicle safety and environmental OMB Control No.: 3060–0730. section no later than October 1, 1996. standards and regulations. To provide a Expiration Date: 10/31/96. ADDRESSES: All written comments focus for public comments, the notice Title: Toll Free Service Access should refer to Docket No. 96–43, Notice also discussed the broad subject areas Codes—800/888 Number Release 1, and be submitted to: Docket Section, and set forth a series of questions and Procedures. NHTSA, 400 Seventh Street SW., issues that NHTSA and EPA would like Form No.: N/A. Washington, D.C. 20590. Docket hours the public to address. The agencies Estimated Annual Burden: 2010 total are 9:30 to 4 p.m. Monday through specified that written comments had to annual hours; 1 hour per respondent Friday. be submitted before the close of (avg.); 2010 respondents. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38201

Estimated Annual Reporting and Description: In the Notice of Proposed FEDERAL DEPOSIT INSURANCE Recordkeeping Cost Burden: $0. of Rulemaking issued in CC Docket No. CORPORATION Description: The Commission has 96–61, the Commission proposes to instructed Database Service eliminate the requirement that Sunshine Act Meeting Management, Inc. (DSMI) to collect nondominant interexchange carriers file Pursuant to the provisions of the authorizations from the current 800 tariffs. In order to facilitate enforcement ‘‘Government in the Sunshine Act’’ (5 number subscriber and its Responsible of such carriers’ statutory obligation to U.S.C. 552b), notice is hereby given that Organization or the Toll Free Service charge just and reasonable, and not at 10:55 a.m. on Tuesday, July 16, 1996, Provider declining their previously unjustly discriminatory rates, in the the Board of Directors of the Federal asserted commercial interest in the 888 absence of tariff filings, the NPRM Deposit Insurance Corporation met in number. DSMI will not release the 888 proposes to require carriers to maintain closed session to consider the following number from the pool of unavailable at their premises business records to matters: numbers into the general pool of toll establish the lawfulness of their rates. Reports of the Office of Inspector free numbers until it receives these The NPRM proposes, among other General authorizations. things, a certification requirement to Matters relating to the Corporation’s OMB Control No.: 3060–0712. implement the geographic rate averaging liquidation and corporate activities Expiration Date: 07/31/99. and rate integration requirements of the An administrative enforcement Title: Petition for Declaratory Ruling 1996 Telecommunications Act. proceeding by the Inmate Calling Services Providers OMB Control No.: 3060–0729. In calling the meeting, the Board Task Force—RM–8181. Expiration Date: 10/31/96. determined, on motion of Vice Form No.: N/A. Title: Bell Operating Company Chairman Andrew C. Hove, Jr., Estimated Annual Burden: 60 total Provision of Out-of-Region, Interstate, seconded by Director Jonathan L. annual hours; 1 hour per respondent Interexchange Services, Report and Fiechter (Acting Director, Office of (avg.); 60 respondents. Order, CC Docket No. 96–21, (Affiliated Thrift Supervision), concurred in by Ms. Estimated Annual Reporting and Company Recordkeeping Requirement). Julie Williams, acting in the place and Recordkeeping Cost Burden: $0. Form No.: N/A. stead of Director Eugene A. Ludwig Description: In the Declaratory Ruling Estimated Annual Burden: 42,394 (Comptroller of the Currency), Director issued in RM–8181, the Commission total annual hours; 6056 hours per Joseph H. Neely (Appointive), and requires that local exchange carriers, respondent (avg.); 7 respondents. Chairman Ricki Helfer, that Corporation among other things, notify their Estimated Annual Reporting and business required its consideration of customers of the change in status of Recordkeeping Cost Burden: $0. the matters on less than seven days’ inmate-only customer premises Description: In the Report and Order notice to the public; that no earlier equipment (CPE). This is necessary to issued in CC docket No. 96–21, the notice of the meeting was practicable; ensure that correctional facility Commission removed dominant that the public interest did not require customers are aware of change in regulation for BOCs that provide out-of- consideration of the matters in a regulatory status of inmate-only region, interstate, interexchange services meeting open to public observation; and payphones. through an affiliate that complies with that the matters could be considered in OMB Control No.: 3060–0233. certain safeguards, in order to facilitate a closed meeting by authority of Expiration Date: 07/31/99. the efficient and rapid provisions of out- subsections (c)(2), (c)(4), (c)(6), (c)(8), Title: Separations—Part 36. of-region, domestic, interstate, (c)(9)(A)(ii), and (c)(9)(B) of the Form No.: N/A. interexchange services by the BOCs, as ‘‘Government in the Sunshine Act’’ (5 Estimated Annual Burden: 61,800 contemplated by the 1996 Act, while U.S.C. 552b (c)(2), (c)(4), (c)(6), (c)(8), total annual hours; 20 hours per still protecting ratepayers and (c)(9)(A)(ii), and (c)(9)(B)). respondent (avg.); 3090 respondents. competition in the interexchange The meeting was held in the Board Estimated Annual Reporting and market. These safeguards require that Room of the FDIC Building located at Recordkeeping Cost Burden: $0. the affiliate: (1) Maintain separate books 550—17th Street, N.W., Washington, Description: Local exchange carriers of account from the LEC; (2) not jointly D.C. (LECs) are required to submit data own transmission or switching facilities Dated: July 17, 1996. annually to the National Exchange with the LEC; and (3) take any tariffed Federal Deposit Insurance Corporation. Carrier Association for the filing of services from the affiliated LEC access tariffs. State or local telephone By: Valerie J. Best, pursuant to the terms and conditions of Valerie J. Best, companies who want to participate in the LEC’s generally applicable tariff. Assistant Executive Secretary. the federal assistance program must The recordkeeping requirement will not make certain informational showings to impose any significant burden on BOC [FR Doc. 96–18770 Filed 7–19–96 11:11 am] demonstrate eligibility. interexchange affiliates because we do BILLING CODE 6714±01±M OMB Control No.: 3060–0704. not require that the interexchange Expiration Date: 06/30/99. affiliate maintain separate books of Title: Policy and Rules Concerning the account that comply with our Part 32 FEDERAL EMERGENCY Interstate, Interexchange Marketplace, rules. MANAGEMENT AGENCY Implementation of Section 254(g) of the Instead, these affiliates must maintain Communications Act of 1934, as Crisis Counseling Assistance and separate books as would any separate Training amended—CC Docket No. 96–61. corporation, as a matter of course. Form No.: N/A. Federal Communications Commission. AGENCY: Federal Emergency Estimated Annual Burden: 2595 total Management Agency. William F. Caton, annual hours; hours per respondent ACTION: Notice. (avg.); 519 respondents. Acting Secretary. Estimated Annual Reporting and [FR Doc. 96–18604 Filed 7–22–96; 8:45 am] SUMMARY: FEMA gives notice that the Recordkeeping Cost Burden: $0. BILLING CODE 6712±01±P extension period for the Oklahoma 38202 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices regular crisis counseling program for FEDERAL RESERVE SYSTEM ADDRESSES: Comments, which should disaster survivors of the Oklahoma City refer to the OMB control number (or bombing is extended from 90 days to Agency Information Collection Agency form number in the case of a 180 days. The severity of the emotional Activities: Proposed Collection; new information collection that has not trauma resulting from the bombing Comment Request yet been assigned an OMB number), should be addressed to William W. warrants an extension of an additional AGENCY: Board of Governors of the Wiles, Secretary, Board of Governors of 90 days. Federal Reserve System. the Federal Reserve System, 20th and C EFFECTIVE DATE: August 1, 1996. ACTION: Notice. Streets, N.W., Washington, DC 20551, or FOR FURTHER INFORMATION CONTACT: BACKGROUND: On June 15, 1984, the delivered to the Board’s mail room Diana Nordboe, Human Services Office of Management and Budget between 8:45 a.m. and 5:15 p.m., and to Division, Response and Recovery (OMB) delegated to the Board of the security control room outside of Directorate, Federal Emergency Governors of the Federal Reserve those hours. Both the mail room and the Management Agency, 500 C Street SW., System (Board) its approval authority security control room are accessible from the courtyard entrance on 20th Washington, DC 20472, (202) 646–4026. under the Paperwork Reduction Act of 1995, as per 5 CFR 1320.16, to approve Street between Constitution Avenue and SUPPLEMENTARY INFORMATION: The of and assign OMB control numbers to C Street, N.W. Comments received may Federal Emergency Management Agency collection of information requests and be inspected in room M-P-500 between (FEMA) is charged with coordinating requirements conducted or sponsored 9:00 a.m. and 5:00 p.m., except as Federal disaster assistance under the by the Board under conditions set forth provided in section 261.8 of the Board’s provisions of the Robert T. Stafford in 5 CFR 1320 Appendix A.1. The Rules Regarding Availability of Disaster Relief and Emergency Federal Reserve may not conduct or Information, 12 CFR 261.8(a). Assistance Act (the Act) when the sponsor, and the respondent is not A copy of the comments may also be President has declared a major disaster. required to respond to, an information submitted to the OMB desk officer for FEMA provided funding for a regular collection that has been extended, the Board: Alexander T. Hunt, Office of crisis counseling program to help those revised, or implemented on or after Information and Regulatory Affairs, suffering the trauma resulting from the October 1, 1995, unless it displays a Office of Management and Budget, New April 19, 1995, bombing of the Alfred P. currently valid OMB control number. Executive Office Building, Room 3208, Washington, DC 20503. Murrah Federal Building. Board-approved collections of information will be incorporated into FOR FURTHER INFORMATION CONTACT: A FEMA received a request from the the official OMB inventory of currently copy of the proposed form and State of Oklahoma to extend the approved collections of information. A instructions, the Paperwork Reduction otherwise applicable time limitations copy of the OMB 83-I and supporting Act Submission (OMB 83-I), supporting authorized by section 416 of the Act, so statement and the approved collection statement, and other documents that that the State can provide additional of information instrument will be will be placed into OMB’s public docket mental health services that are critically placed into OMB’s public docket files. files once approved may be requested needed for citizens during the recovery The following information collection, from the agency clearance officer, whose operation. The extent of the emotional which is being handled under this name appears below. impact on all citizens of Oklahoma is of delegated authority, has received initial Mary M. McLaughlin, Federal Reserve such magnitude that continuation of Board approval and is hereby published Board Clearance Officer (202-452-3829), disaster mental health counseling for comment. At the end of the comment Division of Research and Statistics, beyond the normal crisis counseling period, the proposed information Board of Governors of the Federal time period is necessary. collection, along with an analysis of Reserve System, Washington, DC 20551. Telecommunications Device for the Deaf The Director, Center for Mental comments and recommendations received, will be submitted to the Board (TDD) users may contact Dorothea Health Services (CMHS), as the delegate Thompson (202-452-3544), Board of to FEMA for the Secretary, Department for final approval under OMB delegated authority. Comments are invited on the Governors of the Federal Reserve of Health and Human Services, helps System, Washington, DC 20551. FEMA implement crisis counseling following: (a) whether the proposed collection of Proposal to approve under OMB training and assistance. FEMA believes information is necessary for the proper delegated authority the extension, with there was a well-established need for performance of the Federal Reserve’s revision, of the following report: continuation of the regular crisis functions; including whether the 1. Report title: Survey of Terms of counseling program beyond a 90-day information has practical utility; Bank Lending extension. Based upon the sound CMHS (b) the accuracy of the Federal Agency form number: FR 2028A, FR recommendation, FEMA has approved a Reserve’s estimate of the burden of the 2028B, and FR 2028S 180-day extension to the time period for proposed information collection, OMB control number: 7100-0061 the Oklahoma regular crisis counseling including the validity of the Frequency: quarterly program. methodology and assumptions used; Reporters: commercial banks (all three (Catalog of Federal Domestic Assistance No. (c) ways to enhance the quality, reports) and U.S. branches and agencies 83.516, Disaster Assistance) utility, and clarity of the information to of foreign banks (FR 2028A and FR 2028S) William C. Tidball, be collected; and (d) ways to minimize the burden of Annual reporting hours: 8,095 Associate Director. information collection on respondents, Estimated average hours per response: [FR Doc. 96–18661 Filed 7–22–96; 8:45 am] including through the use of automated FR 2028A: 4.0. FR 2028B: 1.5. FR 2028S: BILLING CODE 6718±02±P collection techniques or other forms of 0.1. information technology. Number of respondents: FR 2028A: 398. DATES: Comments must be submitted on FR 2028B: 250. FR 2028S: 567. or before September 23, 1996. Small businesses are affected. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38203

General description of report: This Board of Governors of the Federal Reserve assets or the ownership of, control of, or information collection is voluntary (12 System, July 17, 1996. the power to vote shares of a bank or U.S.C. § 248(a)(2)) and is given William W. Wiles bank holding company and all of the confidential treatment (5 U.S.C. § Secretary of the Board. banks and nonbanking companies 552(b)(4)). [FR Doc. 96–18587 Filed 7–22–95; 8:45AM] owned by the bank holding company, Billing Code 6210±01±F including the companies listed below. Abstract: The Survey of Terms of The applications listed below, as well Bank Lending provides unique as other related filings required by the information concerning the price and Change in Bank Control Notices; Board, are available for immediate certain nonprice terms of loans made to Acquisitions of Shares of Banks or inspection at the Federal Reserve Bank businesses and farmers by commercial Bank Holding Companies indicated. Once the application has banks. The reports are completed for the been accepted for processing, it will also first full business week of the mid- The notificants listed below have be available for inspection at the offices month of each quarter (February, May, applied under the Change in Bank of the Board of Governors. Interested August, and November). The FR 2028A Control Act (12 U.S.C. 1817(j)) and § persons may express their views in and B collect detailed data on 225.41 of the Board’s Regulation Y (12 writing on the standards enumerated in individual loans made during the CFR 225.41) to acquire a bank or bank the BHC Act (12 U.S.C. 1842(c)). If the survey week. The FR 2028S collects the holding company. The factors that are proposal also involves the acquisition of prime interest rate for each day of the considered in acting on the notices are a nonbanking company, the review also set forth in paragraph 7 of the Act (12 survey. From these sample STBL data, includes whether the acquisition of the U.S.C. 1817(j)(7)). estimates of the terms of business and nonbanking company complies with the The notices are available for standards in section 4 of the BHC Act, farm loans extended during the immediate inspection at the Federal reporting week at all insured U.S. including whether the acquisition of the Reserve Bank indicated. Once the nonbanking company can ‘‘reasonably commercial banks are constructed. The notices have been accepted for be expected to produce benefits to the estimates for business loans are processing, they will also be available public, such as greater convenience, published in the quarterly E.2 release, for inspection at the offices of the Board increased competition, or gains in ‘‘Survey of Terms of Bank Lending,’’ of Governors. Interested persons may efficiency, that outweigh possible while estimates for farm loans are express their views in writing to the adverse effects, such as undue published in the quarterly E.15 release, Reserve Bank indicated for that notice concentration of resources, decreased or ‘‘Agricultural Finance Databook.’’ or to the offices of the Board of unfair competition, conflicts of Revisions proposed to the business Governors. Comments must be received interests, or unsound banking practices’’ loan survey include the elimination of not later than August 12, 1996. (12 U.S.C. 1843). Any request for two items that either have proven A. Federal Reserve Bank of Atlanta a hearing must be accompanied by a (Zane R. Kelley, Vice President) 104 difficult for respondents to report or are statement of the reasons a written Marietta Street, N.W., Atlanta, Georgia insufficiently useful to justify the presentation would not suffice in lieu of 30303: a hearing, identifying specifically any burden their reporting imposes, the 1. Don Arthur Barnette, Riverdale, addition of two new items covering loan questions of fact that are in dispute, Georgia; to acquire 40.07 percent, for a summarizing the evidence that would risk and termination options, and total of 40.19 percent, of the voting be presented at a hearing, and indicating redefinitions of several existing items. shares of Tara Bankshares Corporation, how the party commenting would be The coverage of the reporting panel for Riverdale, Georgia, and thereby aggrieved by approval of the proposal. the business loan survey, currently indirectly acquire Tara State Bank, Unless otherwise noted, nonbanking limited to U.S. commercial banks, Riverdale, Georgia. activities will be conducted throughout would be expanded to include a sample 2. Ferman Motor Car Company, Inc., the United States. of U.S. branches and agencies of foreign Tampa, Florida; to retain 11.16 percent Unless otherwise noted, comments banks, which now account for a of the voting shares of The Tampa regarding each of these applications significant fraction of business lending. Banking Company, Tampa, Florida, and must be received at the Reserve Bank The same item additions and thereby indirectly acquire Bank of indicated or the offices of the Board of redefinitions proposed for the business Tampa, Tampa, Florida. Governors not later than August 16, loan survey also would be made to the Board of Governors of the Federal Reserve 1996. farm loan survey. The prime rate System, July 17, 1996. A. Federal Reserve Bank of Atlanta supplement, now collected only from William W. Wiles, (Zane R. Kelley, Vice President) 104 respondents to the business loan survey, Secretary of the Board. Marietta Street, N.W., Atlanta, Georgia 30303: would be collected from respondents to [FR Doc. 96–18586 Filed 7–22–96; 8:45 am] the farm loan survey as well. The 1. The Maddox Corporation, Blakely, BILLING CODE 6210±01±F Georgia; to become a bank holding revised instructions have been reworded company by acquiring an additional substantially to reflect the proposed 37.5 percent, for a total of 56.18 percent, changes, clarifications requested by Formations of, Acquisitions by, and Mergers of Bank Holding Companies of the voting shares of First State Reserve Bank staff and the respondent Bancshares of Blakely, Inc., Blakely, banks since the last review of this The companies listed in this notice Georgia, and thereby indirectly acquire survey, and revisions necessitated by have applied to the Board for approval, First State Bank of Blakely, Blakely, changes in lending practices. The pursuant to the Bank Holding Company Georgia. First State Bancshares of revised reporting forms and instructions Act of 1956 (12 U.S.C. 1841 et seq.) Blakely, Inc., Blakely, Georgia, has would be implemented as of the (BHC Act), Regulation Y (12 CFR Part applied to acquire First Southwest February 1997 reporting week. 225), and all other applicable statutes Bancorp, Inc., Donalsonville, Georgia, a and regulations to become a bank thrift holding company, and its thrift holding company and/or to acquire the subsidiary, First Federal Savings Bank 38204 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices of Southwest Georgia, Donalsonville, either directly or through a subsidiary or 1. North Shore Community Bancorp, Georgia. Comments for this application other company, in a nonbanking activity Inc., Wilmette, Illinois; to acquire must be received by August 8, 1996. that is listed in § 225.25 of Regulation Crabtree Capital Corporation, 2. Regions Financial Corporation, Y (12 CFR 225.25) or that the Board has Schaumburg, Illinois, and thereby Birmingham, Alabama; to merge with determined by Order to be closely engage in leasing activities pursuant to American Bancshares of Houma, Inc., related to banking and permissible for § 225.25(b)(5) of the Board’s Regulation Houma, Louisiana, and thereby bank holding companies. Unless Y. indirectly acquire American Bank & otherwise noted, these activities will be C. Federal Reserve Bank of Kansas Trust Company of Houma, Houma, conducted throughout the United States. City (John E. Yorke, Senior Vice Louisiana. Each notice is available for inspection President) 925 Grand Avenue, Kansas B. Federal Reserve Bank of Chicago at the Federal Reserve Bank indicated. City, Missouri 64198: (James A. Bluemle, Vice President) 230 Once the notice has been accepted for 1. First Kansas Bancshares, Inc., processing, it will also be available for South LaSalle Street, Chicago, Illinois Hutchinson, Kansas; to engage de novo inspection at the offices of the Board of 60690: through its subsidiary, Personal Finance 1. Capitol Bancorp, Ltd., Lansing, Governors. Interested persons may Corp., Hutchinson, Kansas, in a joint Michigan; to acquire 51 percent of the express their views in writing on the venture in the sale of credit-related voting shares of Macomb Community question whether the proposal complies insurance pursuant to § 225.25(b)(8)(i) Bank, Clinton Township, Michigan. with the standards of section 4 of the of the Board’s Regulation Y. C. Federal Reserve Bank of BHC Act, including whether Minneapolis (James M. Lyon, Vice consummation of the proposal can Board of Governors of the Federal Reserve President) 250 Marquette Avenue, ‘‘reasonably be expected to produce System, July 17, 1996. Minneapolis, Minnesota 55480: benefits to the public, such as greater William W. Wiles, 1. Norwest Corporation, Minneapolis, convenience, increased competition, or Secretary of the Board. Minnesota; to acquire 100 percent of the gains in efficiency, that outweigh [FR Doc. 96–18585 Filed 7–22–96; 8:45 am] voting shares of Texas Bancorporation, possible adverse effects, such as undue BILLING CODE 6210±01±F Inc., Odessa, Texas, and thereby concentration of resources, decreased or indirectly acquire Texas Bank, Odessa, unfair competition, conflicts of Texas. interests, or unsound banking practices’’ D. Federal Reserve Bank of Dallas (12 U.S.C. 1843). Any request for a FEDERAL TRADE COMMISSION (Genie D. Short, Vice President) 2200 hearing on this question must be North Pearl Street, Dallas, Texas 75201- accompanied by a statement of the Granting of Request for Early 2272: reasons a written presentation would Termination of the Waiting Period 1. Henderson Citizens Bancshares, not suffice in lieu of a hearing, Under the Premerger Notification Inc., Henderson, Texas; and Henderson identifying specifically any questions of Rules Citizens Bancshares of Delaware, Inc., fact that are in dispute, summarizing the Dover, Delaware, to acquire 100 percent evidence that would be presented at a Section 7A of the Clayton Act, 15 of the voting shares of Waskom hearing, and indicating how the party U.S.C. 18a, as added by Title II of the Bancshares, Inc., Waskom, Texas, and commenting would be aggrieved by Hart-Scott-Rodino Antitrust thereby indirectly acquire First State approval of the proposal. Improvements Act of 1976, requires Bank, Waskom, Texas. Unless otherwise noted, comments persons contemplating certain mergers or acquisitions to give the Federal Trade Board of Governors of the Federal Reserve regarding the applications must be System, July 17, 1996. received at the Reserve Bank indicated Commission and the Assistant Attorney General advance notice and to wait William W. Wiles, or the offices of the Board of Governors not later than August 6. 1996. designated periods before Secretary of the Board. consummation of such plans. Section [FR Doc. 96–18584 Filed 7–22–96; 8:45 am] A. Federal Reserve Bank of New York (Christopher J. McCurdy, Senior 7A(b)(2) of the Act permits the agencies, BILLING CODE 6210±01±F Vice President) 33 Liberty Street, New in individual cases, to terminate this York, New York 10045: waiting period prior to its expiration 1. Commerbank Aktiengesellschaft, and requires the notice of this action be Notice of Proposals To Engage in published in the Federal Register. Permissible Nonbanking Activities or Frankfurt am Main, Federal Republic of To Acquire Companies That are Germany; to engage de novo through its The following transactions were Engaged in Permissible Nonbanking subsidiary, Commerz Futures granted early termination of the waiting Activities Corporation, Chicago, Illinois, in period provided by law and the securities brokerage activities pursuant premerger notification rules. The grants The companies listed in this notice to § 225.25(b)(15)(i) of the Board’s were made by the Federal Trade have given notice under section 4 of the Regulation Y. These activities will be Commission and the Assistant Attorney Bank Holding Company Act (12 U.S.C. conducted worldwide. General for the Antitrust Division of the 1843) (BHC Act) and Regulation B. Federal Reserve Bank of Chicago Department of Justice. Neither agency Y, (12 CFR Part 225) to engage de novo, (James A. Bluemle, Vice President) 230 intends to take any action with respect or to acquire or control voting securities South LaSalle Street, Chicago, Illinois to these proposed acquisitions during or assets of a company that engages 60690: the applicable waiting period.

TRANSACTIONS GRANTED EARLY TERMINATION BETWEEN: 070196 AND 071296

Date termi- Name of acquiring person, name of acquired person, name of acquired entity PMN No. nated

The Chase Manhattan Banking Corporation, Wireless One, Inc., Wireless One, Inc ...... 96±2187 07/01/96 Southcorp Holdings Limited, Park-Ohio Industries, Inc., Bennett Industries, Inc ...... 96±2077 07/02/96 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38205

TRANSACTIONS GRANTED EARLY TERMINATION BETWEEN: 070196 AND 071296ÐContinued

Date termi- Name of acquiring person, name of acquired person, name of acquired entity PMN No. nated

Aurora Equity Partners L.P., Golder, Thoma, Cressey Fund III Limited Partnership, Dickson Media, Inc ...... 96±2243 07/02/96 Big Flower Press Holdings, Inc., Scanforms, Inc., Scanforms, Inc ...... 96±2244 07/02/96 Takasago International Corporation, Monsanto Company, The nutraSweet Kelco Company ...... 96±2249 07/02/96 TRW Inc., TRW Inc., TRW REDI Property Data ...... 96±2252 07/02/96 Cabletron Systems, Inc., Network Express, Inc., Network Express, Inc ...... 96±2048 07/03/96 CCA Financial, Inc., Un-Ltd Holdings, Inc., Nelco Ltd ...... 96±2213 07/03/96 CalEnergy Company, Inc., David H. Dewhurst III, Falcon Seaboard Resources, Inc...... 96±2234 07/03/96 Jordan Industries, Inc., Abram Ackerman, Viewsonics, Inc ...... 96±2109 07/08/96 Central Garden & Pet Company, Kenlin Pet Supply, Inc., Kenlin Pet Supply, Inc ...... 96±2162 07/08/96 Morton M. Lapides, Sr., The Seagram Company Ltd., Winterland Concessions Company ...... 96±2253 07/08/96 Edward K. Mullen, Nelson-Ball Paper Products, Inc., Nelson-Ball Paper Products, Inc ...... 96±2257 07/08/96 Trinity Industries, Inc., Transcisco Industries, Inc., Transcisco Industries, Inc ...... 96±2258 07/08/96 U.S. Office Products Company, Vassilios Sirpolaidis and Lynne Sirpolaidis, Mile high Office Supply and Office Extra, L.L.C ...... 96±2259 07/08/96 General Electric Company, James Elliott, Universal Data Consultants, Inc ...... 96±2261 07/08/96 General Electric Company, Ken Callaham, Universal Data Consultants, Inc ...... 96±2263 07/08/96 Integrated health Services, Inc., Capstone Pharmacy Services, Inc., Capstone Pharmacy Services, Inc ...... 96±2265 07/08/96 Capstone Pharmacy Services, Inc., Integrated Health Services, Inc., Symphony Pharmacy Services, Inc ...... 96±2266 07/08/96 JP Foodservice, Inc., ``Z'' Leasing Co. (General Partnership), ``Z'' Leasing Co. (General Partnership) ...... 96±2269 07/08/96 JP Foodservice, Inc., Valley Industries, Inc., Valley Industries, Inc ...... 96±2270 07/08/96 Harron Communications Corp., Pegasus Communications Corporation, Pegasus Communications Corporation ...... 96±2271 07/08/96 Marshall W. Pagon, Pegasus Communications Corp., Pegasus Communications Corp ...... 96±2272 07/08/96 Ford Motor Company, Shirley W. Gibson, Monarch Leasing Company ...... 96±2274 07/08/96 AnnTaylor Stores Corporation, Cygne Designs, Inc., Cygne Designs, Inc ...... 96±2275 07/08/96 Bandai Co. Ltd., The Upper Deck Company, The Upper Deck Company LLC ...... 96±2279 07/08/96 ARAMARK Corporation, Crest Uniform Company, Inc., Crest Uniform Company, Inc ...... 96±2282 07/08/96 U.S. Office Products Company, McWhorter's Stationery Company, Inc., McWhorter's Stationery Company, Inc ...... 96±2290 07/08/96 Schnuck Markets, Inc.,Seessels Holdings, Inc.,seessels Holdings, Inc ...... 96±2189 07/10/96 U.S. Diagnostic Labs Inc., HEICO Corporation, MediTek Health Corporation ...... 96±2297 07/10/96 Mr. Donald Gales, J. Duncan McDuff, Regent Investments Inc., Mid-Atlantic Investments Inc ...... 96±1862 07/11/96 Mr. Donald Gales, Mr. Vincent J. Mastracco, Jr., Regent Investments, Inc., Mid-Atlantic Investments, Inc ...... 96±1863 07/11/96 The Hitchcock Alliance, Gifford Medical Center, Gifford Medical Center ...... 96±2157 07/11/96 American Radio Systems Corporation, Triad Capital Management, Inc., Triad Capital Management Inc ...... 96±2190 07/11/96 WPG Corporate Development Associates IV, L.P., GHB Charitable Trust #1, Any-Kind Check Cashing Centers, Inc. and U.S. Check ...... 96±2233 07/11/96 TPG Partners, L.P., AT&T Corporation, AT&T Paradyne Corporation & Lucient Technologies, Inc ...... 96±2248 07/11/96 Kokusai Denshin Denwa Co. Ltd., Pacific Gateway Exchange, Inc., Pacific Gateway Exchange, Inc ...... 96±2285 07/11/96 Olympus Private Placement Fund, L.P., Dr. Manfred George Krukemeyer (a resident of Germany), Paracelsus Healthcare Corporation ...... 96±2291 07/11/96 Alco Standard Corporation, The Computer Group, Inc., The Computer Group, Inc ...... 96±2293 07/11/96 Blackstone Capital Partners II Merchant Banking Fund LP, Golder, Thoma, Cressey Fund III Limited Partnership, Prime Succession, Inc ...... 96±2307 07/11/96 Sanwa Shutter Corporation, Bessemer Securities Corporation, Overhead Door Incorporated ...... 96±2325 07/11/96 Bankers Trust New York Corporation, BT Capital Funding Corporation, BT Capital Funding Corporation ...... 96±2245 07/12/96

FOR FURTHER INFORMATION CONTACT: DEPARTMENT OF HEALTH AND Description: States with excessive Sandra M. Peay or Renee A. Horton, HUMAN SERVICES overpayment error rates or excessive Contact Representatives negative case error rates submit Administration for Children and information about: (1) Their most Federal Trade Commission, Premerger Families common types of errors, (2) the causes Notification Office, Bureau of for those errors, and (3) their intended Competition, Room 303, Washington, Proposed Information Collection actions to reduce those errors. The D.C. 20580, (202)326–3100. Activity; Comment Request Administration for Children and Families then uses this information to By Direction of the Commission. Proposed Projects: Donald S. Clark, help States direct their resources toward Title: State corrective Action Plans for the most efficient and effective Secretary. the Aid to Families with Dependent corrective action techniques. [FR Doc. 96–18619 Filed 7–22–96; 8:45 am] Children (AFDC) Program. Respondents: State, Local or Tribal BILLING CODE 6750±01±M OMB No.: 0970–0027. Govt. 38206 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

ANNUAL BURDEN ESTIMATES

Number of Average Number of responses burden Total bur- Instrument respondents per re- hours per den hours spondent response

Plan ...... 27 1 160 4,320 Estimated Total Annual Burden Hours ...... 4,320

In compliance with the requirements by Thomas Tsakeris, Devices and the applicant from the Director of the of Section 3506(c)(2)(A) of the Diagnostics Consulting Group, Office of Device Evaluation, CDRH. Paperwork Reduction Act of 1995, the Rockville, MD, U.S. Representative for A summary of the safety and Administration for Children and Biomira Diagnostics Inc., 30 Meridian effectiveness data on which CDRH Families is soliciting public comment Rd., Rexdale, ON, Canada, for premarket based its approval is on file in the on the specific aspects of the approval, under the Federal Food, Drug, Dockets Management Branch (address information collection described above. and Cosmetic Act (the act), of above) and is available from that office Copies of the proposed collection of TRUQUANT BRTM RIA. After upon written request. Requests should information can be obtained and reviewing the recommendation of the be identified with the name of the comments may be forwarded by writing Immunology Devices Panel, FDA’s device and the docket number found in to the Administration for Children and Center for Devices and Radiological brackets in the heading of this Families, Office of Information Services, Health (CDRH) notified the applicant, document. Division of Information Resource by letter of March 29, 1996, of the Opportunity for Administrative Review Management Services, 370 L’Enfant approval of the application. Promenade, SW., Washington, DC DATES: Petitions for administrative Section 515(d)(3) of the act (21 U.S.C. 20447, Attn: ACF Reports Clearance review by August 22, 1996. 360e(d)(3)) authorizes any interested Officer. All requests should be person to petition, under section 515(g) ADDRESSES: Written requests for copies identified by the title of the information of the act, for administrative review of of the summary of safety and CDRH’s decision to approve this collection. effectiveness data and petitions for The Department specifically requests application. A petitioner may request administrative review to the Dockets comments on: (a) Whether the proposed either a formal hearing under part 12 (21 Management Branch (HFA–305), Food collection of information is necessary CFR part 12) of FDA’s administrative and Drug Administration, 12420 for the proper performance of the practices and procedures regulations or Parklawn Dr., rm. 1–23, Rockville, MD functions of the agency, including a review of the application and CDRH’s 20857. whether the information shall have action by an independent advisory practical utility; (b) the accuracy of the FOR FURTHER INFORMATION CONTACT: committee of experts. A petition is to be agency’s estimate of the burden of the Peter E. Maxim, Center for Devices and in the form of a petition for proposed collection of information; (c) Radiological Health (HFZ–440), Food reconsideration under § 10.33(b) (21 ways to enhance the quality, utility, and and Drug Administration, 9200 CFR 10.33(b)). A petitioner shall clarity of the information to be Corporate Blvd., Rockville, MD 20850, identify the form of review requested collected; and (d) ways to minimize the 301–594–1293. (hearing or independent advisory burden of the collection of information SUPPLEMENTARY INFORMATION: On committee) and shall submit with the on respondents, including through the February 24, 1995, Thomas M. Tsakeris, petition supporting data and use of automated collection techniques Devices and Diagnostics Consulting information showing that there is a or other forms of information Group, Rockville, MD, U.S. genuine and substantial issue of technology. Consideration will be given Representative for Biomira Diagnostics, material fact for resolution through to comments and suggestions submitted Inc., Rexdale, ON, Canada, submitted to administrative review. After reviewing within 60 days of this publication. CDRH an application for premarket the petition, FDA will decide whether to  TM Dated: July 17, 1996. approval of TRUQUANT BR RIA. grant or deny the petition and will Bob Sargis, The device is an in vitro diagnostic publish a notice of its decision in the device indicated for quantitative Federal Register. If FDA grants the Acting Reports Clearance Officer. determination of CA 27.29 antigen in petition, the notice will state the issue [FR Doc. 96–18558 Filed 7–22–96; 8:45 am] serum or EDTA plasma of patients to be reviewed, the form of the review BILLING CODE 4184±01±M previously treated for Stage II or Stage to be used, the persons who may III breast cancer. Serial testing for CA participate in the review, the time and 27.29 antigen with TRUQUANT BRTM place where the review will occur, and Food and Drug Administration RIA in patients who are clinically free other details. [Docket No. 96M±0216] of disease should be used in Petitioners may, at any time on or conjunction with other clinical methods before August 22, 1996, file with the Biomira Diagnostics, Inc.; Premarket used for the early detection of Dockets Management Branch (address  TM Approval of TRUQUANT BR RIA recurrence. above) two copies of each petition and AGENCY: Food and Drug Administration, On September 21, 1995, the supporting data and information, HHS. Immunology Devices Panel of the identified with the name of the device ACTION: Notice. Medical Devices Advisory Committee, and the docket number found in an FDA advisory committee, reviewed brackets in the heading of this SUMMARY: The Food and Drug and recommended approval of the document. Received petitions may be Administration (FDA) is announcing its application. On March 29, 1996, CDRH seen in the office above between 9 a.m. approval of the application submitted approved the application by a letter to and 4 p.m., Monday through Friday. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38207

This notice is issued under the commenting, please refer to file code SUPPLEMENTARY INFORMATION: Federal Food, Drug, and Cosmetic Act BPD–849–PN. Comments received I. Background (secs. 515(d), 520(h), (21 U.S.C. 360e(d), timely will be available for public 360j(h)) and under authority delegated inspection as they are received, A. Determining Compliance of to the Commissioner of Food and Drugs generally beginning approximately 3 Ambulatory Surgical Centers—Surveys (21 CFR 5.10) and redelegated to the weeks after publication of a document, and Deeming Director, Center for Devices and in Room 309–G of the Department’s In order to participate in the Medicare Radiological Health (21 CFR 5.53). offices at 200 Independence Avenue, program, ambulatory surgical centers Dated: June 21, 1996. SW., Washington, DC, on Monday (ASCs) must meet conditions for Joseph A. Levitt, through Friday of each week from 8:30 coverage specified in regulations that Deputy Director for Regulations Policy, Center a.m. to 5 p.m. (phone (202) 690–7890). implement title XVIII of the Social Security Act (the Act). ASCs enter into for Devices and Radiological Health. Copies: To order copies of the Federal a Medicare participation agreement but [FR Doc. 96–18556 Filed 7–22–96; 8:45 am] Register containing this document, send generally only after they are certified by BILLING CODE 4160±01±F your request to: New Orders, a State survey agency as complying with Superintendent of Documents, P.O. Box the ASC conditions for coverage set 371954, Pittsburgh, PA 15250–7954. Health Care Financing Administration forth in the Act and regulations. ASCs Specify the date of the issue requested are subject to regular surveys by State [BPD±849±PN] and enclose a check or money order agencies to determine whether they payable to the Superintendent of Medicare Program; Recognition of the continue to meet these requirements; an Documents, or enclose your Visa or ASC that does not meet these Ambulatory Surgical Center Standards Master Card number and expiration of the Joint Commission on the requirements is considered out of date. Credit card orders can also be Accreditation of Healthcare compliance and risks having its placed by calling the order desk at (202) Organizations and the Accreditation participation in the Medicare program Association for Ambulatory Health 512–1800 or by faxing to (202) 512– terminated. Care 2250. The cost for each copy is $8. As Section 1865 of the Act includes a an alternative, you can view and provision that permits ASCs to be AGENCY: Health Care Financing photocopy the Federal Register exempt from routine surveys by the Administration (HCFA), HHS. document at most libraries designated State survey agencies to determine ACTION: Proposed notice. as Federal Depository Libraries and at compliance with the Medicare many other public and academic conditions for coverage. (Under our SUMMARY: This notice proposes to grant libraries throughout the country that regulations at 42 CFR 416.40 deeming authority to two organizations, receive the Federal Register. (‘‘Condition for coverage—Compliance the Joint Commission on the with State licensure law’’), an ASC must Accreditation of Healthcare This Federal Register document is still meet the State’s licensure Organizations (JCAHO) and the also available from the Federal Register requirements, however.) Specifically, Accreditation Association for online database through GPO Access, a section 1865(b) of the Act provides that Ambulatory Health Care (AAAHC), for service of the U.S. Government Printing if we find that accreditation of a their member ambulatory surgical Office. Free public access is available on provider entity by a national centers (ASCs) that request Medicare a Wide Area Information Server (WAIS) accreditation body demonstrates that all certification. We believe that through the Internet and via Medicare conditions or requirements are accreditation of ASCs by both asynchronous dial-in. Internet users can met or exceeded, we would (for certain organizations would demonstrate that access the database by using the World providers, including ASCs) ‘‘deem’’ all Medicare ASC conditions are met or Wide Web; the Superintendent of these entities as meeting the applicable exceeded, and, thus, we would grant Documents home page address is http:/ Medicare conditions. deeming authority to each organization. /www.access.gpo.gov/suldocs/, by In making our finding as to whether DATES: Comments will be considered if using local WAIS client software, or by the accreditation body makes this we receive them at the appropriate telnet to swais.access.gpo.gov, then demonstration, we consider factors such address, as provided below, no later login as guest (no password required). as the accrediting body’s accreditation than 5 p.m. on August 22, 1996. Dial-in users should use requirements, its survey procedures, its ADDRESSES: Mail written comments (1 communications software and modem ability to provide adequate resources for original and 3 copies) to the following to call (202) 512–1661; type swais, then conducting required surveys and address: Health Care Financing login as guest (no password required). supplying information for use in Administration, Department of Health For general information about GPO enforcement activities, its monitoring and Human Services, Attention: BPD– Access, contact the GPO Access User procedures for provider entities found to be out of compliance with the 849–PN, P.O. Box 7519, Baltimore, MD Support Team by sending Internet e- conditions or requirements, and its 21207–0519. mail to [email protected] gpo.gov; by If you prefer, you may deliver your ability to provide us with necessary data faxing to (202) 512–1262; or by calling written comments (1 original and 3 for validation. If we find that the copies) to one of the following (202) 512–1530 between 7 a.m. and 5 accreditation of an ASC by the national addresses: Room 309–G, Hubert H. p.m. Eastern time, Monday through accreditation body demonstrates that Humphrey Building, 200 Independence Friday, except for Federal holidays. the Medicare conditions imposed on Avenue, SW., Washington, D.C. 20201, FOR FURTHER INFORMATION CONTACT: Bob ASCs are met, we would treat the or Room C5–09–26, 7500 Security Cereghino, (410) 786–4645. accredited ASCs as meeting those Boulevard, Baltimore, MD 21244–1850. conditions. ASCs as suppliers are Because of staffing and resource included by definition of provider entity limitations, we cannot accept comments in section 1865(b)(4) of the Act. Thus, by facsimile (FAX) transmission. In if we were to recognize an ASC 38208 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices accrediting organization’s program as 104–134. We had received and accepted The organization’s procedures for demonstrating that all the Medicare applications from JCAHO and AAAHC, monitoring providers or suppliers found ASC conditions are met, the ASCs it two national accrediting bodies, long by the organization to be out of accredits would be considered, or before the enactment of section 516 of compliance with program requirements. ‘‘deemed,’’ to meet the same conditions Public Law 104–134. Therefore, this These monitoring procedures are used for which the accreditation standards initial notice, unlike future deeming only when the organization identifies have been recognized. The Joint notices, contains material beyond the noncompliance. If noncompliance is Commission on the Accreditation of scope of the new legislative deeming identified through validation reviews, Healthcare Organizations (JCAHO) and requirements. the survey agency monitors corrections the Accreditation Association for In this notice, we identify the national as specified at § 488.7(b)(2). Ambulatory Health Care (AAAHC) are accreditation bodies making the The ability of the organization to the first two organizations to which we deeming request, describe the nature of report deficiencies to the surveyed have considered granting deemed status. the request, and allow at least a 30-day facilities and respond to the facility’s B. Deeming Authority Process public comment period. We received plan of correction in a timely manner. applications from JCAHO and AAAHC The ability of the organization to On November 23, 1993, we published before the April 26, 1996 enactment of provide us with electronic data in ASCII a final rule (58 FR 61816) that set forth Public Law 104–134. Therefore, the comparable code and reports necessary the procedure that we would use to timeframes imposed by the new for effective validation and assessment review and approve national accrediting legislation are not applicable to the of the organization’s survey process. organizations that wish to be recognized processing of these two organizations’ The adequacy of staff and other as providing reasonable assurance that applications. However, AAAHC wrote resources. Medicare conditions are met (§ 488.4, to us on May 23, 1996 requesting that The organization’s ability to provide ‘‘Application and reapplication we process its application under the procedures for accreditation adequate funding for performing new timeframes. In order to comply required surveys. organizations’’). A national with the requirement in revised section accreditation organization applying for The organization’s policies with 1865(b)(3)(A) of the Act that we publish approval of deeming authority must respect to whether surveys are an initial notice identifying the national furnish to us information and materials announced or unannounced. accreditation body making the request • listed in our regulations at § 488.4. Our The accreditation organization’s not later than 60 days after the date of regulations at § 488.8 (‘‘Federal review agreement to provide us with a copy of receipt of that request, we must publish of accreditation organizations’’) detail the most current accreditation survey the notice by July 22, 1996. Likewise, in the Federal review and approval process together with any other information order to comply with the requirement of applications for deeming authority. related to the survey as we may require that we publish an approval notice of On April 26, 1996, however, new (including corrective action plans). our findings within 210 days after we legislation entitled Making C. Ambulatory Surgical Center Appropriations for Fiscal Year 1996 To receive an organization’s deeming application, we must publish the Conditions of Coverage and Make a Further Downpayment Toward Requirements a Balanced Budget and for Other approval notice by December 19, 1996. Purposes (Public Law 104–134) was Since both applications had been The regulations specifying the enacted. Section 516 of Public Law 104– submitted and considered before the Medicare conditions of coverage for 134 amended section 1865 of the Act in enactment of Public Law 104–134, ASCs are located in 42 CFR part 416. a number of ways. The legislation despite these timeframes, we will make These conditions implement section removed the requirement that every effort to publish the approval 1832(a)(2)(F)(i) of the Act, which accrediting organizations provide notice by November 22, 1996, which is provides for Medicare Part B coverage of reasonable assurance that entities 210 days after the date of the enactment facility services furnished in connection accredited by them would meet of the new legislation. with surgical procedures specified by us Medicare conditions or requirements. It Under revised section 1865(b)(2) of under section 1833(i)(1) of the Act. the Act and our regulations at § 488.8 now, in revised section 1865(b)(1) of the II. Proposed Approval of the Act, requires organizations to (‘‘Federal review of accreditation organizations’’), our review and Ambulatory Surgical Center demonstrate that their accredited Accreditation Standards of the Joint entities would meet or exceed all of the evaluation of a national accreditation organization is conducted in accordance Commission of the Accreditation of applicable Medicare conditions. The Healthcare Organizations and the legislation now also defines, in section with, but is not necessarily limited to, the following factors: Accreditation Association for 1865(b)(4) of the Act, the provider Ambulatory Health Care entities that we may consider for • The equivalency of an accreditation deemed status to include ASCs as organization’s requirements for an entity The purpose of this notice is to suppliers. We are now required to to our comparable requirements for the propose that we recognize the publish an initial notice in the Federal entity. accreditation programs of JCAHO and Register 60 days after the receipt of a • The organization’s survey process AAAHC, two national accrediting written request for a finding that to determine the following: organizations, but only to the extent that accreditation by a national accreditation + The composition of the survey they accredit ASCs. Based on a thorough body demonstrates that the Medicare team, surveyor qualifications, and the examination of the standards, conditions or requirements are met. ability of the organization to provide accrediting programs, and survey This particular notice, however, is continuing surveyor training. processes of both organizations, we unique in that an expanded proposed The comparability of its process to believe that both JCAHO and AAAHC draft had been developed along the lines that of State agencies, including survey demonstrate that ASCs accredited by of our requirements in the statute and frequency, and the ability to investigate them meet Medicare conditions, and regulations that were in effect before the and respond appropriately to we, therefore, invite comments on our enactment of section 516 of Public Law complaints against accredited facilities. proposal to grant ASC deeming Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38209 authority to these two national In evaluating the accreditation plan of correction is monitored by the organizations. standards and survey processes of State Agency. JCAHO and AAAHC to determine if Section 1865(b)(3)(A) of the Act, as A. Differences Between the Joint they demonstrated that their accredited amended by section 516 of Public Law Commission of the Accreditation of facilities meet Medicare conditions, we 104–134, states that a Federal Register Healthcare Organizations and Medicare did a standard by standard comparison approval notice granting deeming to Conditions and Survey Requirements accreditation organizations will follow of the applicable conditions or no later than 210 days after the date of requirements to determine which of We compared the standards contained receipt of a written request or them met or exceeded Medicare in the JCAHO 1994 (and subsequent documentation necessary to make a requirements. We outline below the 1996) Accreditation Manual for determination on the request for differences between the Medicare Ambulatory Health Care and its survey deeming authority. We received requirements and the standards of the procedures to the Medicare ASC applications from JCAHO and AAAHC JCAHO and AAAHC and why we have conditions and survey procedures. We before the April 26, 1996 enactment of concluded that they demonstrated that note that JCAHO standards exceed our Public Law 104–134. Therefore, the our requirements are met by their conditions for coverage in some areas timeframes imposed by the new respective accreditation processes. such as patient rights, education of legislation are not applicable to the Before doing so, however, it is patients and family, and continuity of processing of these two organizations’ important to address the methods care. In the following seven areas, applications. However, AAAHC wrote accreditation organizations and however, Medicare conditions exceeded to us on May 23, 1996 requesting that Medicare use to determine compliance. JCAHO standards as they existed before we process its application under the Information gathered during on-site our discussions with JCAHO. As explained below, however, JCAHO now new timeframes. In order to comply surveys is the basis of an organization’s demonstrates that it meets our with the requirement in revised section accreditation decision. A surveyor or conditions in these areas. 1865(b)(3)(A) of the Act that we publish team of surveyors evaluates the ASC’s an initial notice identifying the national level of compliance with applicable Standards standards. Surveyors assess compliance accreditation body making the request Medicare ASC exclusivity not later than 60 days after the date of in a variety of ways, including interviews, observations, and requirement—Under our regulations at receipt of that request, we must publish § 416.2 (‘‘Definitions’’), a Medicare ASC the notice by July 22, 1996. Likewise, in documentation reviews. We refer frequently to the scoring operates exclusively for the purpose of order to comply with the requirement guidelines that accompany each furnishing surgical services to patients that we publish an approval notice of organization’s standards. The scoring not requiring hospitalization. JCAHO our findings within 210 days after we guidelines express parameters or has no comparable surgical exclusivity receive an organization’s deeming common situations that the requirement; however, for its member application, we must publish the organizations’ surveyors use to make ASCs seeking Medicare certification, approval notice by December 19, 1996. judgments and assign scores to key JCAHO has included a statement on Since both applications had been requirements. Although scoring ASC surgical exclusivity as an integral submitted and considered before the guidelines are not standards, they set part of its application package. This enactment of Public Law 104–134, forth the intent of the standard and statement by the ASC attests that the despite these timeframes, we will make describe the organizations’ expectations facility meets our requirements as to every effort to publish the approval as to how a particular standard must be exclusivity and JCAHO would verify notice by November 22, 1996, which is met. These guidelines are consistently this attestation. Thus, JCAHO has taken 210 days after the date of the enactment used by both organizations’ surveyors in adequate steps to match our exclusivity of the new legislation. The approval determining the score that will be requirement. notice will specify the effective date of applied to assess compliance with each Medicare requirement of ASC use of the deeming authority and the term of standard. Medicare approved laboratory and approval, which will not exceed 6 years. When a surveyor evaluates a standard radiological facilities—Section 416.49 Based on our initial review of each as having partial, minimal, or (‘‘Condition for coverage—Laboratory organization’s standards and survey noncompliance, that is, when the and radiologic services’’) requires the procedures contained in their scoring guideline has not been met or use of Medicare-approved laboratory individual applications and after our has been only partially met, a written and radiologic facilities for ASCs while comparison of both organizations’ recommendation results. JCAHO requires only that laboratory and standards to the Medicare ASC For example, an organization may use radiologic services be ‘‘appropriate.’’ conditions and survey procedures, we a 5-point scale to indicate an ASC’s JCAHO, however, has stated in its April contacted both JCAHO and AAAHC to level of compliance with a standard. An 8, 1994 correspondence that an ASC discuss the differences between ASC score of 1 or 2 for a particular seeking to use its accreditation for Medicare conditions and their accreditation standard corresponds to Medicare certification will be required, standards. our determination of substantial as an integral part of its application, to We met separately with compliance. A score of 3, 4, or 5 attest that, if it is not certified to representatives from both organizations. corresponds to our determination of perform its own laboratory services, it The representatives responded to our noncompliance, which requires the ASC will obtain the services from a concerns by proposing to change their to submit an acceptable plan of laboratory with certification under part standards for their member ASCs correction. The facility’s improvement 493 (‘‘Laboratory Requirements’’). The seeking Medicare certification. We will be monitored through a focused applicant ASC must also attest that it subsequently received, from each survey and/or written progress report. A has procedures for obtaining radiologic organization, revised scoring guidelines written progress report assigned to services from a Medicare-approved with amended standards for their address these deficiencies is normally facility to meet the needs of its patients. member ASCs requesting Medicare due within either 1, 4, or 6 months from The ASC agrees to undergo JCAHO certification. the date the accreditation is final. The verification of these attestations before a 38210 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Joint Commission determination that this Medicare requirement for ASCs B. Differences Between the the ASC qualifies for deemed status requesting Medicare certification. Accreditation Association for recognition. With this standard also, Administration of drugs, drug Ambulatory Health Care and Medicare JCAHO has raised its requirements to an prescriptions, and the administration of Conditions and Survey Requirements equivalency with our conditions. blood products—Our regulations at We compared the standards contained Medicare requirement of separate § 416.48 (‘‘Condition for coverage— in the 1994 through 1995 (and recovery and waiting areas—Our Pharmaceutical services’’) are specific in subsequent 1996 through 1997) AAAHC regulations at paragraph (a)(2) of their requirements regarding the Accreditation Handbook for Ambulatory § 416.44 (‘‘Condition for coverage— administration of drugs, written drug Health Care and its survey procedures to Environment’’) require that Medicare the Medicare ASC conditions and ASCs have separate recovery and administration, and follow-ups on oral prescriptions. JCAHO had no explicit survey procedures. We note that waiting areas. JCAHO has no AAAHC standards exceed our standards comparable to these Medicare requirement comparable to this conditions for coverage in some areas Medicare condition for coverage. requirements. such as patient rights, radiation JCAHO in its revised 1996 Accreditation JCAHO has included in its oncology treatment services, and Manual for Ambulatory Health Care ‘‘Management of Information’’ standard occupational health services. In the under the environmental care standard scoring guidelines (IM.7 through IM.7.2) following nine areas, however, Medicare scoring guideline (EC.4.2) has included and ‘‘Care of Patients’’ standard scoring conditions exceeded AAAHC standards, the Medicare requirement of separate guideline (TX.5.3) revised procedures as they existed before our discussions recovery and waiting areas and will for obtaining blood and blood with AAAHC. As explained below, require compliance from its member components to satisfy Medicare however, AAAHC now demonstrates ASCs seeking Medicare certification. requirements. For example, in IM.7 that it meets our conditions in these Medicare requirement relating to through IM.7.2, orders given orally for areas. emergency equipment—Paragraph (c) of drugs and biologicals must be followed Standards § 416.44 (‘‘Condition for coverage— by a written order signed by the Environment’’) requires that Medicare Medicare exclusivity requirement— prescribing physician and in TX.5.3, Our regulations at § 416.2 ASCs have specific equipment available only physicians or registered nurses to operating rooms. This equipment (‘‘Definitions’’) define an ASC as a may administer blood and blood must include at least the following: distinct entity operating exclusively for products. emergency call systems, oxygen, the purpose of furnishing surgical mechanical ventilatory assistance Procedural Issue services to patients not requiring equipment, cardiac defibrillator, cardiac hospitalization. AAAHC had no monitoring equipment, tracheostomy Medicare requirement of comparable requirement. set, laryngoscopes, endotracheal tubes, unannounced surveys and frequency of AAAHC has supplemented its suction equipment, and emergency surveys—JCAHO surveys of ASCs are surgical services standard to include the medical equipment and supplies announced, in contrast to the Medicare Medicare exclusivity requirement for its specified by the medical staff. In its practice of conducting unannounced ASCs that want to apply their AAAHC 1996 manual revision, JCAHO has surveys. We believe that the findings on accreditation for Medicare certification purposes. amended its environmental care an announced survey are not Medicare separate recordkeeping and standard scoring guideline (EC.4.2) and comparable to those an unannounced staffing requirement—An ASC must be enumerated the emergency equipment survey may find when the facility is in a separately identifiable entity, required by § 416.44(c). JCAHO’s its normal routine. JCAHO has agreed physically, administratively, and member ASCs requesting Medicare that it will conduct unannounced financially independent and distinct certification will comply with this surveys of ASCs requesting to use their from other operations. Thus, an ASC requirement. JCAHO accreditation for Medicare maintains separate staff and keeps Patient care responsibilities for all certification purposes. exclusive records. AAAHC had no nursing services personnel—Our JCAHO resurveys its ASCs every 3 comparable requirement but has regulations at § 416.46 (‘‘Condition for supplemented its Chapter 10, ‘‘Surgical coverage—Nursing services’’) require years. Our original requirement was to survey ASCs every year. In practice, our Services’’ section, to include that ASC nursing services be directed requirements on exclusivity (that is, and staffed to assure that the nursing resurveys have been averaging almost 3 years. Therefore, we accept JCAHO’s 3- separate space, the nonmixing of needs of all patients are met. Patient functions, and separate recordkeeping year resurvey cycle as comparable to care responsibilities must be delineated and staffing). for all nursing service personnel. ours. Medicare requirement of separate Nursing services must be furnished in We propose to make approval of recovery and waiting areas—Paragraph accordance with recognized standards JCAHO’s accreditation program (a)(2) of § 416.44 (‘‘Condition for of practice. Further, a registered nurse contingent on its continued agreement coverage—Environment’’) requires that must be available for emergency to implement the above seven changes Medicare ASCs have separate recovery treatment whenever there is a patient in in its standards and survey and waiting areas. AAAHC does not the ASC. There was no comparable requirements. We believe that these require accredited facilities to have JCAHO requirement that patient care changes bring JCAHO’s accreditation separate recovery room and waiting responsibilities be delineated for all program to a level at least equivalent to areas. AAAHC has included this nursing personnel. However, JCAHO ours. JCAHO has thus demonstrated to requirement in its supplement to has included, among its 1996 leadership our satisfaction that all of our applicable Chapter 8, ‘‘Facilities and standard scoring guidelines (LD.2.1 conditions or requirements are met or Environment,’’ for ASCs interested in through LD.2.6), patient care Medicare certification. responsibilities for nursing service exceeded. Adherence to the Life Safety Code of personnel and requires compliance with the National Fire Protection Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38211

Association—Under our regulations at part 493 of our regulations. AAAHC believe that these changes bring paragraph (b) of § 416.44 (‘‘Condition for further adds that this revised standard AAAHC’s accreditation program to a coverage—Environment’’), ASCs are will be applicable to all organizations level at least equivalent to ours. AAAHC generally required to comply with the surveyed by AAAHC regardless of has thus demonstrated to our provisions of the 1985 edition of the Medicare ASC status. satisfaction that it meets or exceeds all Life Safety Code of the National Fire Medicare requirement on radiologic Medicare applicable conditions or Protection Association. While AAAHC services—Medicare ASCs are required requirements. standards contain a number of to obtain radiologic services from After we evaluate public comments provisions related to ensuring patient Medicare-approved facilities as outlined on this initial notice, we will issue an and facility safety in the event of fire, in our regulations at § 416.49 approval notice in accordance with AAAHC had not previously mandated (‘‘Condition for coverage—Laboratory section 516 of Public Law 104–134 and compliance with the provisions of the and radiologic services’’). The ASC must our regulations at § 488.12 (‘‘Effect of National Fire Protection Association have procedures for obtaining radiologic survey agency certification’’). Once this Life Safety Code but required services from a Medicare-approved approval notice is approved and compliance with applicable local or facility to meet the needs of patients. published in the Federal Register, ASCs State safety codes. AAAHC states in its supplement to would inform their respective State Nevertheless, in its supplementary Chapter 17, ‘‘Diagnostic Imaging Agencies of their accreditation status standard to Chapter 8, ‘‘Facilities and Services,’’ that ASCs desiring Medicare with either the JCAHO or AAAHC. The Environment,’’ AAAHC requires an ASC certification must have arrangements State Agencies in turn, would inform requesting Medicare certification to with providers/suppliers of radiology their respective HCFA Regional Offices. comply with the provisions of the services meeting Medicare conditions. The Regional Offices collect this National Fire Protection Association This action, we believe, ensures that information and put the information Life Safety Code. More specifically, the AAAHC’s member ASCs seeking into the HCFA Online Survey and Life Safety Code is incorporated by Medicare certification will comply with Certification Automated system. reference into the AAAHC standard. this requirement. Specific Medicare requirements Hospitalization—Medicare requires C. Proposed Stipulations Relating to relating to pharmaceutical services— ASCs to have procedures for transfer to Accreditation by the Joint Commission Medicare has specific requirements a hospital of patients requiring on the Accreditation of Healthcare regarding adverse patient reaction to emergency medical care beyond the Organizations and the Accreditation drugs, the administration of blood ASC’s capabilities. Medicare requires Association for Ambulatory Health Care products and written/oral orders for the hospital to be a local, Medicare- According to our regulations at drugs and biologicals (§ 416.48, participating hospital, or a local, § 488.8 (‘‘Federal review of accreditation ‘‘Condition for coverage— nonparticipating hospital that meets the organizations’’), to ensure continuing Pharmaceutical services’’). AAAHC requirements for payment for emergency comparability, an accreditation requirements did not address these services under Federal regulations. organization granted deeming authority concerns. AAAHC required procedures for transfer is subject to continuing Federal AAAHC has stated in its supplement to a nearby hospital but did not specify oversight, which includes comparability to Chapter 15, ‘‘Pharmaceutical that it must be a Medicare participating reviews and validation reviews. Section Services,’’ that adverse drug reactions hospital or a nonparticipating hospital 488.8 lists reapplication procedures, will be reported to the responsible meeting Federal emergency payment which may be no later than every 6 physician and will be documented in requirements. AAAHC has included this years. We propose to recognize as the written record. Blood and blood Medicare requirement in its supplement meeting Medicare’s ASC conditions products will only be administered by to Chapter 10, ‘‘Surgical Services,’’ for those ASCs accredited under JCAHO’s physicians and registered nurses. ASCs seeking Medicare certification. and AAAHC’s accreditation programs Further, orders given orally for drugs with the following restrictions included Procedural Issue and biologicals will be followed by a in § 488.8(e): written order, signed by the prescribing Medicare requirement of • We would reserve the right to physician. We believe AAAHC’s unannounced surveys and resurvey withdraw deemed status from all adoption of these practices ensures frequency—AAAHC surveys of ASCs JCAHO-accredited or AAAHC- compliance with our requirement. are announced in contrast to the accredited ASCs should either Medicare requirement relating to Medicare practice of conducting organization revise its standards or laboratory services—Medicare requires unannounced surveys. In its handbook accreditation policies and procedures in that physicians and other suppliers section, ‘‘Accreditation Policies and a manner in which it fails to performing laboratory services meet the Procedures,’’ AAAHC has altered its demonstrate that its ASCs continue to requirements of part 493 of our original position and has stated that it meet Medicare conditions. regulations (‘‘Laboratory will conduct unannounced surveys for • We also would reserve the right to Requirements’’). ASCs seeking Medicare certification. withdraw deemed status from all AAAHC did not have this AAAHC resurveys ASCS every 3 years. JCAHO-accredited or AAAHC- requirement but has included it in the Our original requirement was to survey accredited ASCs if we should change supplement to Chapter 16, ‘‘Pathology ASCs every year. In practice, our ASC conditions in a manner in which, and Medical Laboratory Services.’’ resurveys have been averaging almost 3 after a time allowance specified in Specifically, an ASC that performs years. We therefore believe AAAHC’s 3- § 488.8(e), JCAHO or AAAHC standards laboratory services must meet the year resurvey cycle meets Medicare or accreditation policies would not requirements of part 493 of our requirements. demonstrate that the revised Medicare regulations; if an ASC does not provide We propose to make our approval of ASC conditions are met. its own laboratory services, it must have AAAHC’s accreditation program • We would reserve the right to procedures for obtaining routine and contingent on its continued agreement withdraw deemed status from all emergency laboratory services from a to implement the above nine changes to JCAHO or AAAHC accredited ASCs if a certified laboratory in accordance with its standards and requirements. We validation review or a public complaint 38212 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices review reveals widespread, systematic, Medicaid certified ASCs. We conducted DEPARTMENT OF THE INTERIOR and unresolvable problems with the 211 initial, 288 recertification (both at a JCAHO or AAAHC accreditation process cost of $714,069), and 24 complaint Fish and Wildlife Service with respect to these ASC programs. surveys. As the data above indicate, the Notice of Availability of an These problems would provide number of ASCs and the cost for evidence that JCAHO or AAAHC ASCs Environmental Assessment/Habitat conducting ASC surveys are increasing; Conservation Plan and Receipt of cease to demonstrate that they meet however, the number of surveys Medicare conditions. Application for Incidental Take Permit conducted is decreasing. We contacted for Construction and Operation of D. Conclusion several Regional Offices to determine Residential Development on the Seven For the reasons stated above, we the number of pending ASC initial Oaks Ranch Property, in Austin, Travis believe that the JCAHO and AAAHC surveys, which number approximately County, Texas 200 to 300. These pending initial accreditation standards and survey SUMMARY: Bee Cave Oaks Development, processes, subject to the stipulations surveys are not uniformly dispersed among the Regional Offices, so there Inc. (applicant) has applied to the U.S. described, demonstrate that Medicare Fish and Wildlife Service (Service) for would be a significant impact on some conditions or requirements have been an incidental take permit pursuant to Regional Offices. met or exceeded. We therefore propose Section 10(a)(1)(b) of the Endangered to deem ASCs accredited by JCAHO and For the current fiscal year, the Species Act (Act). The applicant has AAAHC to be in compliance with the appropriation for survey activities has been assigned permit number PRT– Medicare conditions for ASCs in not increased over the levels granted for 812688. The requested permit, which is accordance with the authority provided fiscal years 1994 and 1995. Yet, the for a period of 30 years, would authorize in section 1865 of the Act. numbers of participating providers and the incidental take of the endangered III. Paperwork Reduction Act suppliers continue to increase. As golden-cheeked warbler (Dendroica indicated above, there was a 22 percent chrysoparia), and impacts to the The burden reflected in this notice is proposed endangered Barton Springs referenced in the currently approved increase in ASCs within 3 years (fiscal years 1993 through 1995). In an effort to salamander (Eurycea sosorum) have regulation entitled ‘‘Granting and been addressed in the associated Habitat Withdrawal of Deeming Authority to guarantee the continued health, safety, and services of beneficiaries in facilities Conservation Plan. The proposed take National Accreditation Organizations on the 304-acre northern parcel may (HSQ–159–F).’’ The paperwork burden already certified, as well as provide relief in this time of tight fiscal occur as a result of the development of referenced in this regulation has been 160 residential lots on 260 acres. submitted to the Office of Management restraints, we are proposing to deem ASCs accredited by the JCAHO and Approximately 44 acres will be and Budget for review and approval preserved as a greenbelt. Twenty-six AAAHC as meeting Medicare under HCFA form number ‘‘HCFA-R– residential lots are planned on requirements. Thus we continue our 191.’’ Persons can reference the approximately 29 acres of the 43-acre supporting statement for this paperwork focus on assuring the health and safety southern parcel, with 14 acres being collection (HCFA-R–191) on the of services by providers and suppliers preserved as a greenbelt. All INTERNET at http://www.hcfa.gov until already certified for participation in a construction will occur on the 347-acre the Office of Management and Budget’s cost effective manner. Seven Oaks Ranch Property located in approval has been obtained. In accordance with the provisions of Austin, Travis County, Texas. IV. Response to Comments Executive Order 12866, this notice was The Service has prepared the Because of the large number of items not reviewed by the Office of Environmental Assessment/Habitat of correspondence we normally receive Management and Budget. Conservation Plan (EA/HCP) for the on Federal Register documents incidental take applications. A Authority: Section 1865 of the Social determination of whether jeopardy to published for comment, we are not able Security Act (42 U.S.C. 1395bb). to acknowledge or respond to them the species will likely result or a (Catalog of Federal Domestic Assistance Finding of No Significant Impact individually. We will consider all Program No. 93.774, Medicare— comments we receive by the date and (FONSI) will not be made before 30 days Supplementary Medical Insurance Program) from the date of publication of this time specified in the DATES section of Dated: June 28, 1996. this preamble, and, if we proceed with notice. This notice is provided pursuant a subsequent document, we will Bruce C. Vladeck, to Section 10(c) of the Act and National respond to the comments in the Administrator, Health Care Financing Environmental Policy Act regulations preamble to that document. Administration. (40 CFR 1506.6). DATES: Written comments on the Dated: July 18, 1996. V. Impact Regulatory Statement application should be received on or Donna E. Shalala, In fiscal year 1993, there were 1,657 before August 22, 1996. certified ASCs participating in the Secretary. ADDRESSES: Persons wishing to review Medicare/Medicaid programs. We [FR Doc. 96–18709 Filed 7–22–96; 8:45 am] the application may obtain a copy by conducted 141 initial, 549 BILLING CODE 4120±01±P writing to the Regional Director, U.S. recertification (both at a cost of Fish and Wildlife Service, P.O. Box $537,312), and 18 complaint surveys. In 1306, Albuquerque, New Mexico 87103. fiscal year 1994, there were 1,855 Persons wishing to review the EA/HCP certified ASCs. This was an increase of may obtain a copy by contacting Mary 198 facilities. We conducted 213 initial, Orms, Ecological Services Field Office, 492 recertification (both at a cost of 10711 Burnet Road, Suite 200, Austin, $555,068), and 24 complaint surveys. In Texas 78758 (512/490–0063). fiscal year 1995, there were 2,105 ASCs. Documents will be available for public This was an increase of 250 Medicare/ inspection by written request, by Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38213 appointment only, during normal Bureau of Indian Affairs recreation and public purposes under business hours (8:00 to 4:30) at the the above Act and under serial number Service’s Austin, Texas Ecological Indian Gaming WYW 0200621, is hereby terminated as it affects the following described lands: Services Field Office. Written data or AGENCY: Bureau of Indian Affairs, comments concerning the application(s) Interior. Sixth Principal Meridian and EA/HCPs should be submitted to ACTION: Notice of approved Tribal-State the Field Supervisor, Ecological Field T. 14 N., R. 70 W., Compact. Sec. 28, lot 2, SW1⁄4. Office, Austin, Texas (see ADDRESS The area described contains 238.29 acres in above). Please refer to permit number SUMMARY: Pursuant to 25 U.S.C. 2710, of PRT–812688 when submitting the Indian Gaming Regulatory Act of Laramie County. comments. 1988 (Pub. L. 100–497), the Secretary of 2. Pursuant to regulations at 43 CFR the Interior shall publish, in the Federal FOR FURTHER INFORMATION CONTACT: 2091.2–2(b), mineral interests reserved Register, notice of approved Tribal-State by the United States in connection with Mary Orms at the above Austin Compacts for the purpose of engaging in the conveyance of public lands under Ecological Service Field Office. Class III (casino) gambling on Indian the Recreation and Public Purposes Act, reservations. The Assistant Secretary— SUPPLEMENTARY INFORMATION: Section 9 remain segregated from the mining laws Indian Affairs, Department of the of the Act prohibits the ‘‘taking’’ of pending the issuance of such Interior, through her delegated endangered species such as the golden- regulations as the Secretary of the authority, has approved the Tribal-State Interior may prescribe. cheeked warbler. However, the Service, Class III Gaming Compact between the under limited circumstances, may issue Puyallup Tribe of Indians and the State Dated: July 16, 1996. permits to take endangered wildlife of Washington, which was executed on Melvin Schlagel, species when such taking is incidental May 28, 1996. Realty Officer. to, and not the purpose of, otherwise DATES: This action is effective July 23, [FR Doc. 96–18591 Filed 7–22–96; 8:45 am] lawful activities. Regulations governing 1996. permits for endangered species are at 50 BILLING CODE 4310±22±P FOR FURTHER INFORMATION CONTACT: CFR 17.22. George T. Skibine, Director, Indian Applicant Gaming Management Staff, Bureau of [AZ±040±7122±00±5567; AZA 29361] Indian Affairs, Washington, DC 20240, Bee Cave Oaks Development, Inc. (202) 219–4068. Notice of Intent To Amend the Safford plans to construct 186 residential lots Dated: July 12, 1996. District Resource Management Plan; and preserve approximately 58 acres of Arizona greenbelt areas within the 347-acre tract. Ada E. Deer, Assistant Secretary—Indian Affairs. The construction will be located at The AGENCY: Bureau of Land Management, [FR Doc. 96–18620 Filed 7–22–96; 8:45 am] Seven Oaks Ranch Property, located Interior. along Bee Cave Road (Highway 2244) BILLING CODE 4310±02±P between River Hills and Cuernavaca ACTION: Notice. Roads in Austin, Travis County, Texas. Bureau of Land Management This action will eliminate SUMMARY: The following lands in approximately 240 acres of habitat and [WY±921±1990±00; Wyoming 0200621] Cochise County, Arizona have been six warbler territories. The applicant found to meet the criteria for sale under proposes to compensate for this Realty Action: Termination of Section 203 of the Federal Land Policy incidental take of golden-cheeked Recreation and Public Purposes Management Act. The Safford District warbler habitat by purchasing 73 acres Classification; Wyoming Resource Management Plan will be amended by adding these lands to of high quality habitat in the Vaughn AGENCY: BLM, Interior. Tract, located north of F.M. 2769, Appendix 5, Lands that Meet Federal ACTION: Classification termination. Land Policy and Management Act roughly 1.6 miles west of its intersection Requirements for Sale. with Bullick Hollow Road, within the SUMMARY: This order terminates a BLM Cypress Creek macrosite preserve area classification affecting 238.29 acres of Gila and Salt River Meridian, Arizona of the Balcones Canyonlands public land near Cheyenne, Wyoming. T. 23 S., R. 24 E., Conservation Plan area, in Travis EFFECTIVE DATE: July 23, 1996. Sec. 10, lots 7 to 10, inclusive, W1⁄2NE1⁄4, County. The land will be donated to the FOR FURTHER INFORMATION CONTACT: SW1⁄4NE1⁄4; Lower Colorado River Authority and Tamara Gertsch, Realty Specialist, Sec. 11, lots 4 through 8, inclusive, N1⁄2, funding will be provided for operation Wyoming State Office, BLM, 5353 NE1⁄4SE1⁄4. and maintenance of the acquired Yellowstone Road, Cheyenne, Wyoming SUPPLEMENTARY INFORMATION: These habitat. 82009, 307–775–6115. lands are proposed for sale to Phelps By virtue of the authority vested in Alternatives to this action were Dodge Corporation (published at 61 FR the Secretary of the Interior by the rejected because selling or not 6257). Interested parties may submit Recreation and Public Purposes Act of developing the subject property with comments to Area Manager, Tucson June 14, 1926, as amended; 43 U.S.C. federally listed species present was not Resource Area Office, 12661 East 869; 869–4; it is ordered as follows: 1. economically feasible. Broadway Boulevard, Tucson, Arizona Pursuant to the regulations in 43 CFR 85748 until August 22, 19960. Nancy M. Kaufman, 2091–7–1(b)(2) and the authority Regional Director, Region 2, Albuquerque, delegated to me by BLM Manual Section FOR INFORMATION CONTACT: Bill Auby, New Mexico. 1203 (48 FR 85), the classification Geologist, BLM, Tucson Resource Area [FR Doc. 96–18590 Filed 7–22–96; 8:45 am] decision of April 26, 1962, which Office, telephone number (520) 722– BILLING CODE 4510±55±M classified the land as suitable for 4289. 38214 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Dated: July 11, 1996. 7127. Written comments should be WISCONSIN Thomas D. Terry, submitted by August 7, 1996. Vilas County Acting District Manager. Beth Boland, Region Nine Training School, 611 Sheridan [FR Doc. 96–18579 Filed 7–22–96; 8:45 am] Acting, Keeper of the National Register. St., Eagle River, 96000890 BILLING CODE 4310±32±M GEORGIA In order to assist in the preservation of the following property, the comment period has Clarke County been waived: Rocksprings Shotgun Row Historic District National Park Service RHODE ISLAND (Shotgun Houses of Athens—Clarke Kriti Exploration & Production County MPS) 433—447 Rocksprings St., Bristol County Company, Big Thicket National Athens, 96000875 O’Bannon Mill, 90 Bay Spring Ave., Preserve, Jasper County, Texas; Hancock County Barrington, 96000891 Availability of Plan of Operations and Hurt—Rives Plantation, Address Restricted, [FR Doc. 96–18594 Filed 7–22–96; 8:45 am] Environmental Assessment Drilling an Sparta vicinity, 96000874 BILLING CODE 4310±70±P Exploratory Oil Well ILLINOIS Notice is hereby given in accordance Fulton County Proposed Boundary Adjustment of with Section 9.52(b) of Title 36 of the Odd Fellows Opera Block, Jct. of Main and Olympic National Park; Exchange of Code of Federal Regulations, Part 9, Mechanic Sts., SW corner, Ellisville, Lands in Clallam and Mason Counties, Subpart B, that the National Park 96000876 Washington Service has received from Kriti KENTUCKY ACTION: Notice of realty action on Exploration & Production Company a Lee County proposed boundary adjustment and Plan of Operations for the continuing lands exchange. operation of four oil wells and Cold Oak Shelter (15LE50), Address associated production equipment in Big Restricted, Zachariah vicinity, 96000877 SUMMARY: The National Park Service Thicket National Preserve, located Pine Crest Shelter (15LE70), Address (NPS), the State of Washington (State) Restricted, Zachariah vicinity, 96000878 within Jasper County, Texas. and the City of Tacoma (Tacoma) are The Plan of Operations and MARYLAND proposing a lands exchange pursuant to Environmental Assessment are available Somerset County the Act of October 23, 1992, Public Law 102–436 (106 Stat. 2217) and the Act of for public review and comment for a Pritchard, Dr. William B., House, 29994 Polks period of 30 days from the publication Rd., Princess Anne vicinity, 96000879 July 15, 1968 (16 U.S.C. 460 1–22(b)), also in accordance with the Act of June date of this notice. The documents can Wicomico County 29, 1938 establishing Olympic National be viewed during normal business hours Honeysuckle Lodge, 1601 Camden Ave., Park (16 U.S.C. 251) as amended. at the Office of the Superintendent, Big Salisbury, 96000880 Federal lands within Olympic National Thicket National Preserve, 3785 Milam MONTANA Park (ONP) are authorized for disposal Street, Beaumont, Texas. Copies can be to Tacoma for operation of the Lake requested from the Superintendent Big Missoula County Cushman hydroelectric project. The Thicket National Preserve, 3785 Milam, Bluebird Building, 220—224 N. Higgins Ave., boundary of ONP would be adjusted to Beaumont, TX 77701. Missoula, 96000881 delete these disposed federal lands. In Dated: July 16, 1996. OHIO exchange, the United States (U.S.) will Richard R. Peterson, acquire State-owned lands within the Hancock County boundaries of ONP to be provided by Superintendent, Big Thicket National Marion Township School District No. 3, 8884 Preserve. Tacoma. Co. Rt. 236, Findlay vicinity, 96000883 [FR Doc. 96–18691 Filed 7–22–96; 8:45 am] SUPPLEMENTARY INFORMATION: An Scioto County environmental assessment for this BILLING CODE 4310±70±M Zottman House, 11 Offners St., Portsmouth, project was completed in July 1994, 96000882 resulting in a Finding of No Significant Impact on February 16, 1996. National Register of Historic Places; PENNSYLVANIA Notification of Pending Nominations The following described federal lands Bucks County are being proposed for disposal by the Nominations for the following Rhoads Homestead (New Hope MRA) 102— U.S. and proposed for deletion from the properties being considered for listing 106 W. Bridge St., New Hope, 85003655 boundaries of ONP: in the National Register were received UTAH Willamette Meridian by the National Park Service before July Salt Lake County Township 23 North, Range 5 West, 17, 1996. Pursuant to § 60.13 of 36 CFR Tract 37 in unsurveyed Sections 3 and 4. Part 60 written comments concerning Allsop—Jensen House (Sandy City MPS) Containing 29.83 acres, more or less. 8829 S. 400 East St., Sandy, 96000885 the significance of these properties Bateman Agriculture and Development In exchange, the U.S. will acquire the under the National Register criteria for Company (Sandy City MPS) 198 E. 8760 following described lands: evaluation may be forwarded to the South St., Sandy, 96000888 Willamette Meridian National Register, National Park Service, Cushing, Ernest and Sadie, House (Sandy P.O. Box 37127, Washington, DC 20013– City MPS) 60 E. Pioneer Ave., Sandy, Township 30 North, Range 10 West, 96000887 Section 26: NW1⁄4 NW1⁄4, and Dobbs, Emma Olive, House (Sandy City MPS) Township 28 North, Range 15 West, 578 E. 8885 South St., Sandy, 96000889 Section 36: N1⁄2 NE1⁄4 NE1⁄4 SW1⁄4. Mattson, John and Mary, House (Sandy City The above lands aggregating 45 acres, more MPS) 239 E. Main St., Sandy, 96000886 or less. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38215

The lands to be exchanged have been 1996 with the United States District Demolition Service and Rain determined to be of equal value. Court for the District of South Dakota. Construction Company, No. C–3–94– This lands exchange and boundary The proposed consent decree resolves 330 (S.D. Ohio), was lodged with the adjustment is being proposed to the United States’ claim for past United States District Court for the facilitate Tacoma’s operation of the Lake response costs at the Traub Battery and Southern District of Ohio on July 3, Cushman hydroelectric project, which Body Shop Superfund Site pursuant to 1996. periodically inundates the above federal Section 107(a) of the Comprehensive The proposed consent decree land within ONP. Management of these Environmental Response, concerns alleged violations of the Clean lands, although being conveyed to Compensation, and Liability Act of 1980 Water Act, 33 U.S.C. 1311, as a result of Tacoma and being removed from the (‘‘CERCLA’’), as amended, 42 U.S.C. the discharge of fill material onto boundary of ONP, will continue to 9607(a). Under the terms of the consent portions of property located in Clark include public access and resource decree, the Settling Defendants, Exide County, Ohio, which are alleged to protection through a management Corporation, Graham Tire Company, J.C. constitute ‘‘waters of the United States.’’ agreement. Penney Co., Inc., K-Mart Corporation, The consent decree (1) requires Ron The exchange also provides for the John Morrell & Co., Inc., and the South Brown and Rain Construction Company, U.S. acquisition of State lands within Dakota Department Of Transportation, Inc., to refrain from further unpermitted the boundaries of ONP, which will be will pay the United States the sum of discharges at the wetland; (2) requires administered by NPS. Acquisition of $313,000 in settlement of the United Ron Brown to remove all illegally- these lands will provide protection to States’ past response cost claim for costs placed fill within a five-year period and valuable wildlife habitat, wilderness, incurred by the United States in to dispose of the fill in an cultural and recreational resources connection with the cleanup of lead- environmentally appropriate manner; within ONP. contaminated soils at the Traub Battery and (3) requires Rain Construction There are no leases or permits to other and Body Shop Superfund Site (the Company, Inc., to perform Ron Brown’s third parties affecting the federal lands ‘‘Site’’) located near Sioux Falls, South fill removal obligations if he is unable proposed for disposal. These lands have Dakota. to do so. been surveyed for cultural resources and The Department of Justice will The Department of Justice will accept threatened/endangered species and receive, for a period of thirty (30) days written comments relating to the found suitable for disposal given the from the date of this publication, proposed consent decree for thirty (30) mitigation measures provided by comments relating to the proposed days from the date of publication of this agreement. consent decree. Comments should be notice. Comments should be addressed FURTHER INFORMATION AND COMMENTS: addressed to the Assistant Attorney to the Assistant Attorney General, More detailed information on this General for the Environment and Environment and Natural Resources proposed action may be obtained from Natural Resources Division, Department Division, U.S. Department of Justice, the Superintendent, Olympic National of Justice, Washington, DC 20530, and Attention: Michael J. Zevenbergen, 10th should refer to United States versus & Pennsylvania Avenue, N.W., Room Park, 600 East Park Avenue, Port # Angeles, Washington 98362–6789. Exide Corporation et al., DOJ Ref. 90– 7216—Main Building, Washington, D.C. Public comments will be accepted for a 11–2–1139. 20530 and should refer to United States The proposed consent decree may be period of 45 calendar days from the v. Ron Brown d/b/a Ron Brown examined at the United States publication date of this notice. Demolition Service and Rain Department of Justice, Environment and Comments should be sent to the Construction Company, DJ Reference Natural Resources Division, Denver Superintendent, Olympic National Park No. 90–5–1–6–600. Field Office, 999 18th Street, North at the above address. The consent decree may be examined Tower Suite 945, Denver, Colorado, In the absence of any subsequent at the Clerk’s Office, United States 80202 and at the Consent Decree action to modify or vacate the proposed District Court, Federal Building, 200 Library, 1120 G Street, NW., 4th Floor, exchange and boundary adjustment, this West 2nd Street, Ninth Floor, Dayton, Washington, DC 20005, 202–624–0892. realty action to proceed with the Ohio, 45402. A copy of the proposed consent decree exchange and boundary adjustment will Anna Wolgast, may be obtained in person or by mail become the final determination of the Acting Chief, Environmental Defense Section, from the Consent Decree Library, 1120 Department of the Interior. Environment and Natural Resources Division, G Street, NW., 4th Floor, Washington, U.S. Department of Justice. Dated: July 12, 1996. DC 20005. In requesting a copy, please [FR Doc. 96–18684 Filed 7–22–96; 8:45 am] William C. Walters, refer to the referenced case and enclose BILLING CODE 4410±01±M Deputy Field Director, Pacific West Field a check in the amount of $4.50 (25 cents Area. per page reproduction costs), payable to [FR Doc. 96–18690 Filed 7–22–96; 8:45 am] the Consent Decree Library. Antitrust Division BILLING CODE 4310±70±M Walker Smith, Deputy Chief, Environmental Enforcement Notice Pursuant to the National Section. Cooperative Research and Production DEPARTMENT OF JUSTICE [FR Doc. 96–18683 Filed 7–22–96; 8:45 am] Act of 1992ÐInter Company BILLING CODE 4410±01±M Collaboration for Aids Drug Notice of Lodging of Consent Decree Development Pursuant to the Comprehensive Environmental Response, Notice of Lodging of Consent Decree Notice is hereby given that, on June Compensation, and Liability Act Pursuant to the Clean Water Act 26, 1996, pursuant to Section 6(a) of the National Cooperative Research and Notice is hereby given that a proposed In accordance with Departmental Production Act of 1993, 15 U.S.C. 4301 consent decree in United States versus Policy, 28 C.F.R. 50.7, notice is hereby et seq. (‘‘the Act’’), Inter Company Exide Corporation et al., Civil Action given that a consent decree in United Collaboration for Aids Drug No. CA 94–4086, as lodged on July 10, States v. Ron Brown d/b/a Ron Brown Development (The Collaboration) filed 38216 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices written notifications simultaneously of multiple antiviral drugs filed written notifications with the Attorney General and the recommended by the Collaboration’s simultaneously with the Attorney Federal Trade Commission. The Clinical Trial Subcommittee. The trials General and the Federal Trade notifications were filed for the purpose will be conducted by clinical research Commission disclosing additions to the of invoking the Act’s provisions limiting organizations selected by the membership. The notifications were the recovery of antitrust plaintiffs to Collaboration, pursuant to a protocol(s) filed for the purpose of extending the actual damages under specified approved by the Collaboration that will Act’s provisions limiting the recovery of circumstances. The following permit the systematic and rapid antitrust plaintiffs to actual damages companies (including their affiliates and evaluation of multiple drug under specified circumstances. subsidiaries) are parties to the combinations. Membership in the Specifically the following company has Collaboration: AB Astra, Sodertalje, Collaboration remains open, and the joined CableLabs: SWEDEN; Agouron Pharmaceuticals, Collaboration intends to file additional Summit Communications, Inc., Inc., La Jolla, CA; AJI PHARMA USA, written notifications disclosing all Bellevue, WA. Inc., Teaneck, NJ; Bayer changes in membership. No other changes have been made in Aktiengesellschaft, Leverkusen, Constance K. Robinson, either the membership or planned GERMANY; Boehringer Ingelheim Director of Operations, Antitrust Division. activity of CableLabs. Membership remains open and CableLabs intends to Pharmaceuticals, Inc., Ridgefield, CT; [FR Doc. 96–18680 Filed 7–22–96; 8:45am] file additional written notifications Bristol-Myers Squibb Company, New BILLING CODE 4410±01±M York, NY; Bristol-Myers, Squibb disclosing all changes in membership. Holdings, Limited, Ickenham, Uxbridge, On August 8, 1988, CableLabs filed its ENGLAND; Bristol-Myers, Squibb, Notice Pursuant to the National original notification pursuant to Section Brussels, BELGIUM; Bristol-Myers, Cooperative Research and Production 6(a) of the Act. The Department of Brussels, BELGIUM; Bristol-Myers Act of 1993; Air Products and Justice published a notice in the Federal Squibb Canada, Inc., North York, Chemicals, Inc. Register pursuant to Section 6(b) of the Ontario, CANADA; Bristol-Myers Act on September 7, 1988 (53 FR Notice is hereby given that, on June 34593). The last notification with Squibb Pharmaceuticals, Limited, 13, 1996, pursuant to Section 6(a) of the respect to membership changes was Middlesex, ENGLAND; Bristol-Myers National Cooperative Research and filed with the Department on December Squibb S.A., Paris, FRANCE; Bristol- Production Act of 1993, 15 U.S.C. 4301 7, 1994. A notice was published in the Myers Squibb G.m.b.H., Munich, et seq. (‘‘the Act’’), Air Products and Federal Register pursuant to Section GERMANY; Bristol-Myers Squibb Chemicals, Inc. has filed written 6(b) of the Act on March 23, 1995 (60 S.p.A., Rome, ITALY; E.R. Squibb & notifications simultaneously with the FR 15307). Corrections to the December Sons, Inc., Princeton, NJ; E.R. Squibb & Attorney General and the Federal Trade 7, 1994 filing were published on July 25, Sons Limited, Middlesex, NJ; Mead Commission disclosing (1) the identities 1995 (60 FR 38058) and on April 30, Johnson & Company, Evansville, IN; of the parties and (2) the nature and 1996 (61 FR 19089). The last Squibb Corporation, Princeton, NJ; Ciba- objective of the venture. The notification with respect to membership Geigy Limited, Basel, SWITZERLAND; notifications were filed for the purpose changes was filed with the Department The DuPont Merck Pharmaceutical of invoking the Act’s provisions limiting on August 2, 1995. A notice was Company, Wilmington, DE; Gilead the recovery of antitrust plaintiffs to published in the Federal Register Sciences, Inc., Foster City, CA; Glaxo actual damages under specified pursuant to Section 6(b) of the Act on Wellcome Inc., Research Triangle Park, circumstances. Pursuant to Section 6(b) June 5, 1996 (61 FR 28596). NC; Glaxo Wellcome plc, London, of the Act, the identities of the parties ENGLAND; The Wellcome Foundation Constance K. Robinson, are: Air Products and Chemicals, Inc., Ltd., London, ENGLAND; Glaxo Director of Operations, Antitrust Division. Allentown, PA; L’Air Liquide, Societe Wellcome Inc., Mississauga, Ontario, [FR Doc. 96–18679 Filed 7–22–96; 8:45 am] Anonyme Pour L’Etude et CANADA, Hoechst Ag, Frankfurt am BILLING CODE 4410±01±M L’Exploitation Des Procedes Georges Main, GERMANY; Hoechst Marion Claude, Paris, FRANCE; and Zeochem, Roussel Inc., Kansas City, MO; Hoffman- J.V., Louisville, KY. The objective of the La Roche Inc., Nutley, NJ; F.Hoffman- Notice Pursuant to the National joint venture is to develop, produce and LaRoche Ltd., Basel, SWITZERLAND, Cooperative Research and Production share in production of new adsorbents Merck & Co., Inc., Whitehouse Station, Act of 1993; The Frame Relay Forum for the separation of air to recover NJ; Pfizer Inc., New York, NY; oxygen and/or nitrogen. Notice is hereby given that, on July 1, Pharmacia & Upjohn Company, Constance K. Robinson, 1996, pursuant to section 6(a) of the Kalamazoo, MI; Sigma-Tau S.p.A., National Cooperative Research and Director of Operations, Antitrust Division. Pomezia (Rome), ITALY; SmithKline Production Act of 1993, 15 U.S.C. 4301 Beecham plc, Brentford, Middlesex, [FR Doc. 96–18676 Filed 7–212–96; 8:45 am] et seq. (‘‘the Act’’), the Frame Relay ENGLAND and Triangle BILLING CODE 4410±01±M Forum (‘‘Forum’’) has filed written Pharmaceuticals, Inc., Durham, NC. notifications simultaneously with the The parties to the Collaboration will Notice Pursuant to the National Attorney General and the Federal Trade exchange scientific research and Cooperative Research and Production Commission disclosing changes in its development data on HIV antiviral Act of 1993; Cable Television membership. The notifications were drugs and HIV antiviral compounds for Laboratories, Inc. filed for the purpose of extending the comparative and/or concomitant AIDS Act’s provisions limiting the recovery of research and development and to Notice is hereby given that, on April antitrust plaintiffs to actual damages develop standardized preclinical testing 23, 1996, pursuant to Section 6(a) of the under specified circumstances. procedures, essays, and other standards National Cooperative Research and Specifically, the identities of the new and tests for HIV antiviral compounds. Production Act of 1993, 15 U.S.C. 4301 members of the Forum are as follows: The parties will coordinate a number of et seq. (‘‘the Act’’), Cable Television Global One, Paris, FRANCE; and clinical trials of different combinations Laboratories, Inc. (‘‘CableLabs’’) has ViaDSP, Inc., Concord, MA. OSIconsult Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38217

GmbH, Vienna, AUSTRIA has joined as Semiconductor Packages, Inc., John K. Peters, Light Helicopter Turbine an auditing member. The following Minneapolis, MN. Engine Company, St. Louis, MO. companies have ceased to be members No other changes have been made in Constance K. Robinson, of the Forum: Amoco, Chicago, IL; BT either the membership or planned Director of Operations, Antitrust Division. Telecommunications, Madrid, SPAIN; activity of the joint venture. CILAP CrossComm, Gdansk, POLAND; [FR Doc. 96–18681 Filed 7–22–96; 8:45 am] intends to file additional written BILLING CODE 4410±01±M Computerm Corporation, Pittsburgh, notifications disclosing all membership PA; DSC Communications Corp., Plano, changes. TX; France Telecom/Transpac, Paris, FRANCE; Fujitsu, Raleigh, NC; General On May 23, 1995, CILAP filed its Notice Pursuant to the National Instrument, Hatboro, PA; GTE Irving, original notification pursuant to section Cooperative Research and Production TX; Home Savings of America, 6(a) of the Act. The Department of Act of 1993; Petroleum Environmental Irwindale, CA; Kasten Chase, Justice published a notice in the Federal Research Forum Project No. 95±06 Mississauga, Ontario, CANADA; Novell, Register pursuant to section 6(b) of the Notice is hereby given that, on June San Jose, CA; Presticom, St. Hubert, Act on November 13, 1995 (60 FR 12, 1996, pursuant to Section 6(a) of the Quebec, CANADA; Siemens Stromberg- 57021). National Cooperative Research and Carlson, Boca Raton, FL; Tandem Constance K. Robinson, Production Act of 1993, 15 U.S.C. 4301, Computers, Cupertino, CA; Tekelec, et seq. (‘‘the Act’’), the participants in Calabasas, CA; and US Robotics, Skokie, Director of Operations, Antitrust Division. [FR Doc. 96–18682 Filed 7–22–96; 8:45 am] the Petroleum Environmental Research IL. Forum (‘‘PERF’’) Project No. 95–06, No other changes have been made in BILLING CODE 4410±01±M titled ‘‘Effects of RVP Reduction on either the membership or planned Vehicle CO Emissions During Las Vegas activity of the joint venture. and Los Angeles Winter Conditions,’’ Membership in this venture remains Notice Pursuant to the National have filed written notifications open. The Forum intends to file Cooperative Research and Production simultaneously with the Attorney additional written notifications Act of 1993ÐLight Helicopter Turbine General and with the Federal Trade disclosing all membership changes. Engine Company Consortium On April 10, 1992, the Forum filed its Commission disclosing (1) The original notification pursuant to section Notice is hereby given that, on June identities of the parties and (2) the 6(a) of the Act. The Department of 14, 1996, pursuant to Section 6(a) of the nature and objectives of the joint Justice published a notice in the Federal National Cooperative Research and research and development venture. The Register pursuant to § 6(b) of the Act on Production Act of 1993, 15 U.S.C. 4301, notifications were filed for the purpose July 2, 1992 (57 FR 29537). The last et seq (‘‘the Act’’), the participants in of invoking the Act’s provisions limiting notification was filed on April 29, 1996. the Light Helicopter Turbine Engine the recovery of antitrust plaintiffs to A notice was published in the Federal Company Consortium have filed written actual damages under specified Register on May 15, 1996. notification simultaneously with the circumstances. Pursuant to Section 6(b) of the Act, the identities of the current Constance K. Robinson, Attorney General and with the Federal participants in PERF Project No. 95–06 Director of Operations, Antitrust Division. Trade Commission disclosing (1) the identities of the parties and (2) the are: Chevron Research and Technology [FR Doc. 96–18678 Filed 7–22–96; 8:45 am] Company, Richmond, CA; Arco BILLING CODE 4410±01±M nature and objectives of the joint technology and development venture. Products Company, Anaheim, CA; Clark The notifications were filed for the County Health District of the State of Nevada, Las Vegas, NV; and Texaco Notice Pursuant to the National purpose of invoking the Act’s provisions Group Inc., Beacon, NY. Research and Cooperative Research and Production limiting the recovery of antitrust development work required in Act of 1993 Consortium for Intelligent plaintiffs to actual damages under furtherance of the Project is to be carried Large Area Processing specified circumstances. Pursuant to Section 6(b) of the Act, the identities of out by Chevron Research and Notice is hereby given that, on June 7, the current participants in the Light Technology Company as Contract 1996, pursuant to section 6(a) of the Helicopter Turbine Engine Company Coordinator and/or outside consultants National Cooperative Research and Consortium are: Allison Engine and contractors selected by the Contract Production Act of 1993, 15 U.S.C. 4301 Company, Inc., Indianapolis, IN; and Coordinator, preferably with the review et seq. (‘‘the Act’’), the Consortium for AlliedSignal Engines, Phoenix, AZ. and recommendation of the Technical Intelligent Large Area Processing Advisory Committee representing the (‘‘CILAP’’), has filed written The nature and objective of the Participants. notifications simultaneously with the Consortium is to engage in collaborative The nature and objective of the Attorney General and the Federal Trade research of limited duration to gain research program performed in Commission disclosing changes in its further knowledge and understanding accordance with PERF Project No. 95– membership. The notifications were within the scope of a Technology 06 is to study the effects of RVP filed for the purpose of extending the Reinvestment Program administered by reduction on vehicle CO emissions Act’s provisions limiting the recovery of the Defense Advanced Research Projects during Las Vegas and Los Angeles antitrust plaintiffs to actual damages Agency (DARPA) under Agreement No. winter conditions. under specified circumstances. MDA972–96–3–0013 for the Advanced Participation in this Project will Specifically, the changes are as follows: CTP800 Turboprop for Surveillance remain open to interested persons and ACSIST Associates, Inc., was acquired Aircraft. The purpose of the Consortium organizations until the Project by Johnson Matthey, Inc., which is a is not the production of a product, completion date, which is presently wholly owned subsidiary of Johnson process, or service. anticipated to occur approximately Matthey PLC. As a result of the Information regarding the Light December 15, 1996, but no later than acquisition, ACSIST Associates, Inc. Helicopter Turbine Engine Company December 31, 1996. The Participants was renamed Johnson Matthey Consortium may be obtained from Mr. intend to file additional written 38218 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices notification(s) disclosing all changes in or Linda McKay, SCAAP Coordinator, at DEPARTMENT OF LABOR membership in this Project. 1–800–421–6770. Information regarding participation in SUPPLEMENTARY INFORMATION: The Employment and Training Petroleum Environmental Research following supplementary information is Administration Form (‘‘PERF’’) Project No. 95–06 may provided: be obtained from Mr. James A. The State Criminal Alien Assistance Investigations Regarding Certifications Rutherford, Chevron Research and Program (SCAAP) provides Federal of Eligibility To Apply for Worker Technology Company, Richmond, CA. assistance to states and localities for Adjustment Assistance Constance K. Robinson, costs incurred for the imprisonment of Director of Operations, Antitrust Division. undocumented criminal aliens who are Petitions have been filed with the [FR Doc. 96–18677 Filed 7–22–96; 8:45 am] convicted of felony offenses. The Fiscal Secretary of Labor under Section 221(a) Year 1996 Omnibus Appropriations Act, of the Trade Act of 1974 (‘‘the Act’’) and BILLING CODE 4410±01±M Pub.L. No. 104–134 (April 25, 1996) are identified in the Appendix to this provides an allocation of $500 million notice. Upon receipt of these petitions, Office of Justice Programs for payments under Title II, subtitle C, the Program Manager of the Office of Section 20301, of the Violent Crime Trade Adjustment Assistance, Bureau of Justice Assistance Control and Law Enforcement Act of Employment and Training 1994, Pub. L. No. 103–322 (September [OJP (BJA) No. 1090] Administration, has instituted 13, 1994), which amends Section 242 of investigations pursuant to Section RIN 1121±ZA41 the Immigration and Nationality Act, 221(a) of the Act. codified at 8 U.S.C. § 1252. This is a State Criminal Alien Assistance new legal authorization for the program The purpose of each of the Program from that underlying last year’s investigations is to determine whether program, which was governed by 8 the workers are eligible to apply for AGENCY: U.S. Department of Justice, U.S.C. § 1365. The new legal adjustment assistance under Title II, Office of Justice Programs, Bureau of authorization has resulted in many Chapter 2, of the Act. The investigations Justice Assistance (BJA). changes to the program including the will further relate, as appropriate, to the ACTION: Notice of fund and guidance expansion of the pool of eligible determination of the date on which total availability. applicants from states only to a or partial separations began or significant number of local jurisdictions. SUMMARY: This notice is to announce the threatened to begin and the subdivision These changes have required several of the firm involved. availability of $500 million pursuant to modifications in the process to be used the State Criminal Alien Assistance in Fiscal Year 1996 to distribute SCAAP The petitioners or any other persons Program (SCAAP), as newly authorized funds. The process is fully explained in showing a substantial interest in the under 8 U.S.C. § 1252(j). Under this the guidance document. subject matter of the investigations may authorization states and political The Bureau of Justice Assistance request a public hearing, provided such subdivisions of states may apply to the (BJA), part of the Office of Justice request is filed in writing with the Bureau of Justice Assistance for Programs (OJP), will administer SCAAP Program Manager, Office of Trade reimbursement for their expenditures through a grants mechanism according Adjustment Assistance, at the address for the incarceration of undocumented to the application requirements shown below, not later than August 2, criminal alien felons. This notice contained in the guidance and 1996. announces the availability of these application kit. All applicants that funds and of the availability of guidance Interested persons are invited to comply with these requirements will submit written comments regarding the governing the program, including the share in the appropriation based on the subject matter of the investigations to application forms. The guidance has number of incarcerated aliens found to the Program Manager, Office of Trade detailed information regarding program be reimbursable, their average length of operation in this fiscal year and is being incarceration, and the costs of inmate Adjustment Assistance, at the address mailed to correctional facilities in upkeep. Data provided by applicants on shown below, not later than August 2, potentially eligible jurisdictions. Any their potentially eligible incarcerated 1996. jurisdiction that does not receive a copy populations will again be verified by the The petitions filed in this case are of the guidance and application kit by Immigration and Naturalization Service available for inspection at the Office of July 26, 1996, may obtain a copy by (INS) using a computerized matching the Program Manager, Office of Trade contacting the Bureau of Justice technique. Adjustment Assistance, Employment Assistance through the Response Center The application, verification, and and Training Administration, U.S. below. award processes are fully explained in Department of Labor, 200 Constitution DATES: Guidance will be sent out to the guidance document which is being Avenue, NW., Washington, DC 20210. eligible jurisdictions in mid July. The mailed to all identified eligible deadline for submitting application jurisdictions and is available from the Signed at Washington, DC this 8th day of materials ranges from late August to mid Bureau of Justice Assistance. July, 1996. September depending on the type of Nancy Gist, Russell Kile, applicant (i.e. state or local jurisdiction). Director, Bureau of Justice Assistance. Acting Program Manager, Policy & FOR FURTHER INFORMATION CONTACT: The [FR Doc. 96–18671 Filed 7–22–96; 8:45 am] Reemployment Services, Office of Trade Adjustment Assistance. Department of Justice Response Center BILLING CODE 4410±18±P Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38219

APPENDIX [Petitions Instituted on 07/08/96]

Date of peti- TA±W Subject firm (petitioners) Location tion Product(s)

32,509 ..... Caribou Ltd. (Co.) ...... Nashville, TN ...... 06/14/96 Ladies' Sportswear. 32,510 ..... McCrackin Industries (Co.) ...... Conley, GA ...... 06/12/96 Ladies' Handbags. 32,511 ..... Rol Manufacturing (Wkrs) ...... Brownsville, TX ...... 06/10/96 Engine Gaskets. 32,512 ..... SST Energy Corp. (Wkrs) ...... Casper, WY ...... 06/06/96 Exploration of Oil and Gas. 32,513 ..... Wood World, Inc. (Wkrs) ...... Marion, VA ...... 06/24/96 Figurines. 32,514 ..... Weyerhauser (UPI) ...... Buffalo, NY ...... 06/24/96 Corrugated Shipping Containers. 32,515 ..... Westmoreland Plastics (IUE) ...... Latrobe, PA ...... 06/20/96 Rings for Coffee Pots. 32,516 ..... Buster Brown Apparel (Co.) ...... Sylva, NC ...... 06/26/96 Children's Apparel. 32,517 ..... International Paper Co. (CJA) ...... Veneta, OR ...... 06/17/96 Logs. 32,518 ..... Lloyd-Smith Company (Co.) ...... Bradford, PA ...... 06/24/96 Oilfield Products. 32,519 ..... Automed, Inc. (Wkrs) ...... Arden Hills, MN ...... 05/21/96 Laboratory Specimen Handling Equip- ment. 32,520 ..... BP Oil, Inc (OCAW) ...... Marcus Hook, PA ...... 06/21/96 Petroleum Products. 32,521 ..... BP Exploration (Co.) ...... Anchorage, AK ...... 06/21/96 Crude Oil/Natural Gas. 32,522 ..... Bidermann Industries (Wkrs) ...... Secaucus, NY ...... 05/23/96 Ladies' Dresses, Suits and Sportswear. 32,523 ..... Pioneer Cut Stock, Inc (Wkrs) ...... Prineville, OR ...... 06/19/96 Remanufactured Wood Products. 32,524 ..... Blount, Inc. (Wkrs) ...... Owatonna, MN ...... 06/12/96 Tractors. 32,525 ..... Jatco (Wkrs) ...... Shellman, GA ...... 06/28/96 Ladies' Sportswear. 32,526 ..... The Kendall Company (Co.) ...... Albertville, AL ...... 06/20/96 Cotton Yarn. 32,527 ..... Superior Milling Ltd (Wkrs) ...... Watersmeet, MI ...... 05/20/96 Green Hardwood Lumber. 32,528 ..... Hickory Hills Industries (Wkrs) ...... Clifton, TN ...... 06/18/96 Children's Wear Hdqrs. 32,529 ..... Magnetic Engineering (Co.) ...... Manitou Springs, CO ...... 06/20/96 Linear Motors, Bonded Magnetic Assemb. 32,530 ..... Fields Apparel, Inc (Wkrs) ...... Monticello, KY ...... 06/20/96 Men's Dress, Casual and Work Shirts. 32,531 ..... Trust Joist International () ...... Hawkins, WI ...... 06/19/96 Wood Window Units. 32,532 ..... Orbit Industries (Co.) ...... Helen, GA ...... 06/24/96 Ladies' Knit and Woven Garments. 32,533 ..... Pendleton Woolen Mills (UNITE) ...... Council Bluffs, IA ...... 06/18/96 Women's Blazers and Vests. 32,534 ..... Pendleton Woolen Mills (UNITE) ...... Nebraska City, NE ...... 06/18/96 Ladies' Skirts and Pants, Dresses. 32,535 ..... North American Rayon Corp (UFCW) ...... Elizabethton, TN ...... 06/19/96 Rayon Fabic. 32,536 ..... North American Polyester (OCAW) ...... Elizabethton, TN ...... 06/19/96 Polyester Fabric. 32,537 ..... Cape Cod Cricket Lane (Wkrs) ...... Pleasant Shade, TN ...... 06/24/96 Sportswear. 32,538 ..... Ithaca Industries, Inc (Co.) ...... Sylvania, GA ...... 06/17/96 Men's and Boys' Tee Shirts. 32,539 ..... Digital Equipment Corp. (Co.) ...... Colorado Springs, CO ...... 06/27/96 Computer Storage Devices, Module Assem. 32,540 ..... I.C.I. Explosives (OCAW) ...... Tamaqua, PA ...... 03/25/96 Blasting Caps. 32,541 ..... Prentiss Manufacturing (Wkrs) ...... Iuka, MS ...... 06/26/96 Men's Shirts. 32,542 ..... W and J Rives (Co.) ...... High Point, NC ...... 06/28/96 Men's Ladies' and Childrens' Clothing. 32,543 ..... United Technologies (Co.) ...... Cheshire, CT ...... 06/24/96 Jet Engine Parts. 32,544 ..... Suburban Apparel (UNITE) ...... Orange, NY ...... 06/26/96 Wool Coats. 32,545 ..... Remington Firearms Co. (Co.) ...... Ilion, Ny ...... 06/21/96 Firearms. 32,546 ..... DM IV, Inc. (Co.) ...... Centerville, TN ...... 06/26/96 Children's Clothing.

[FR Doc. 96–18635 Filed 7–22–96; 8:45 am] At the request of the State Agency, the 1994 are eligible to apply for adjustment BILLING CODE 4510±30±M Department reviewed the certification assistance under Section 223 of the Trade Act for workers of the subject firm. Workers of 1974. of the subject firm are engaged in the Signed at Washington, D.C. this 3rd day of July 1996. [TA±W±31, 738] production of composite sports equipment. New findings show that Curtis K. Kooser, Easton Composites, Inc., Easton some of the workers of Easton Acting Program Manager, Policy and Composites Manufacturing, Inc., Composites, Inc., and Easton Reemployment Services, Office of Trade Easton Aluminum Inc., San Diego, CA; Composites, Mfg., Inc., had their Adjustment Assistance. Amended Certification Regarding unemployment insurance (UI) taxes [FR Doc. 96–18628 Filed 7–22–96; 8:45 am] Eligibility to Apply for Worker paid to Easton Aluminum Inc. The BILLING CODE 4510±30±M Adjustment Assistance Department is amending the certification to properly reflect this In accordance with Section 223 of the matter. [TA±W±32,347] Trade Act of 1974 (19 U.S.C. 2273) the The amended notice applicable to Fasco Consumer Products; Department of Labor issued a TA–W–31, 738 is hereby issued as Fayetteville, North Carolina; Dismissal Certification of Eligibility to Apply for follows: of Application for Reconsideration Worker Adjustment Assistance on March 27, 1996, applicable to all All workers of Easton Composites, Inc. and Pursuant to 29 CFR 90.18(C) an Easton Composites Manufacturing, Inc., and workers at Easton Composites, Inc., and those workers of Easton Aluminum, Inc. application for administrative Easton Composites Manufacturing, Inc., engaged in employment related to the reconsideration was filed with the located in San Diego, California. The production of composite sports equipment, Program Manager of the Office of Trade notice was published in the Federal who became totally or partially separated Adjustment Assistance for workers at Register on April 9, 1996 (61 FR 15832). from employment on or after December 4, Fasco Consumer Products, Fayetteville, 38220 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

North Carolina. The review indicated adjustment assistance under Section 223 of [TA±W±32, 096] that the application contained no new the Trade Act of 1974. substantial information which would Signed at Washington, DC this 5th day of Beaver Shoe Company, Kinney Shoe bear importantly on the Department’s July 1996. Corporation, Beaver Springs, determination. Therefore, dismissal of Curtis K. Kooser, Pennsylvania; Notice of Revised the application was issued. Acting Program Manager, Policy and Determination on Reopening TA–W–32,347; Fasco Consumer Reemployment Services, Office of Trade On May 9, 1996, the Department Products Adjustment Assistance. issued a Negative Determination Fayetteville, North Carolina (July 12, [FR Doc. 96–18630 Filed 7–22–96; 8:45 am] Regarding Eligibility to Apply for 1996) BILLING CODE 4510±30±M Worker Adjustment Assistance, Signed at Washington, D.C. this 15th day applicable to all workers of Kinney Shoe of July, 1996. Corporation, located in Beaver Springs, Russell T. Kile, [TA±W±32,178; TA±W±32,178B] Pennsylvania. The notice was published Acting Program Manager, Policy & in the Federal Register on May 24, 1996 Kentucky Apparel LLP, Burkesville, KY Reemployment Services, Office of Trade (FR 61 26219). Adjustment Assistance. and Tompkinsville, KY; Amended On its own motion, the Department [FR Doc. 96–18636 Filed 7–22–96; 8:45 am] Certification Regarding Eligibility to Apply for Worker Adjustment reviewed the findings of the BILLING CODE 4510±30±M Assistance investigation. The workers produce men’s, women’s and children’s [TA±W±32,006] In accordance with Section 223 of the footwear. Findings show that Beaver Trade Act of 1974 (19 USC 2273) the Shoe Company is a manufacturing Kendal Healthcare Products Company Department of Labor issued a division of Kinney Shoe Corporation. Including Leased Workers of Kelly Certification of Eligibility to Apply for The subject firm had declining sales, Temporary Services and Interim Worker Adjustment Assistance on April production and employment during the Temporary Services, Cumberland, RI; 29, 1996, applicable to all workers of time period relevant to the Amended Certification Regarding Kentucky Apparel LLP, located in investigation. Eligibility To Apply for Worker Burkesville, Kentucky. The notice was New findings on reopening show that Adjustment Assistance published in the Federal Register on the footwear production by Kinney Shoe May 17, 1996 (61 FR 24960). Corporation is mass marketed. In accordance with Section 223 of the Therefore, the articles manufactured by Trade Act of 1974 (19 USC 2273) the At the request of the company, the the subject firm have been impacted Department of Labor issued a Department reviewed the certification importantly by the high penetration of Certification of Eligibility to Apply for for workers of the subject firm. New nonrubber footwear imports in this Worker Adjustment Assistance on April information provided by the company market. In 1994 and 1995, the ratio of 15, 1996, applicable to all workers of shows that worker separations have U.S. imports to domestic production of Kendall Healthcare Products Company occurred at the corporate offices of men’s shoes was more than 300%, and located in Cumberland, Rhode Island. Kentucky Apparel in Tompkinsville, for women’s shoes more than 1,000%. The notice was published in the Federal Kentucky. The workers provide Register on April 29, 1996 (61 FR administrative and support services for Conclusion 18758). the subject firm’s denim jean production At the request of the State agency, the at various locations. After careful review of the additional Department reviewed the certification The intent of the Department’s facts obtained on reopening, I conclude for workers of the subject firm. Based on certification is to include all workers of that increased imports of articles like or new findings, the Department is the subject firm who were adversely directly competitive with shoes amending the certification to include affected by increased imports of jeans. contributed importantly to the declines leased workers from Kelly Temporary Accordingly, the Department is in sales or production and to the total Services and Interim Temporary amending the certification to cover the or partial separation of workers of all Services, both located in Cumberland, workers of Kentucky Apparel LLP in affected workers of the Beaver Shoe Rhode Island, engaged in the production Tompkinsville, Kentucky. Company in Beaver Springs, Pennsylvania. In accordance with the of disposable medical products for the The amended notice applicable to provisions of the Act, I make the subject firm. TA–W–32,178 is hereby issued as following certification: The intent of the Department’s follows: certification is to include all workers of All workers of Beaver Shoe Company, All workers of Kentucky Apparel LLP, Kendall Healthcare Products Company Kinney Shoe Corporation, Beaver Springs, adversely affected by imports. located in Burkesville (TA–W–32,178) and Tompkinsville (TA–W–32,178B) Kentucky Pennsylvania, who became totally or The amended notice applicable to who became totally or partially separated partially separated from employment on or TA–W–32,006 is hereby issued as from employment on or after March 11, 1995 after March 14, 1995 are eligible to apply for follows: are eligible to apply for adjustment assistance adjustment assistance under Section 223 of All workers of Kendall Healthcare Products under Section 223 of the Trade Act of 1974. the Trade Act of 1974. Company, Cumberland, Rhode Island, and Signed at Washington, D.C. this 5th day of Signed at Washington, DC this 3rd day of leased workers of Kelly Temporary Services July 1996. July 1996. and Interim Temporary Services, Curtis K. Kooser, Curtis K. Kooser, Cumberland, Rhode Island, engaged in the Acting Program Manager, Policy and Acting Program Manager, Policy and production of disposable medical products Reemployment Services, Office of Trade Reemployment Services, Office of Trade for the Kendall Healthcare Products Adjustment Assistance. Adjustment Assistance. Company, who became totally or partially separated from employment on or after [FR Doc. 96–18632 Filed 7–22–96; 8:45 am] [FR Doc. 96–18638 Filed 7–22–96; 8:45 am] February 15, 1995, are eligible to apply for BILLING CODE 4510±30±M BILLING CODE 4510±30±M Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38221

Investigations Regarding Certifications adjustment assistance under Title II, subject matter of the investigations to of Eligibility To Apply for Worker Chapter 2, of the Act. The investigations the Program Manager, Office of Trade Adjustment Assistance will further relate, as appropriate, to the Adjustment Assistance, at the address determination of the date on which total shown below, not later than August 2, Petitions have been filed with the or partial separations began or 1996. Secretary of Labor under Section 221(a) threatened to begin and the subdivision The petitions filed in this case are of the Trade Act of 1974 (‘‘the Act’’) and of the firm involved. available for inspection at the Office of are identified in the Appendix to this The petitioners or any other persons the Program Manager, Office of Trade notice. Upon receipt of these petitions, showing a substantial interest in the Adjustment Assistance, Employment the Program Manager of the Office of subject matter of the investigations may and Training Administration, U.S. Trade Adjustment Assistance, request a public hearing, provided such Department of Labor, 200 Constitution Employment and Training request is filed in writing with the Avenue, NW., Washington, DC 20210. Administration, has instituted Program Manager, Office of Trade Signed at Washington, DC this 1st day of investigations pursuant to Section Adjustment Assistance, at the address July, 1996. 221(a) of the Act. shown below, not later than August 2, Curtis K. Kooser, The purpose of each of the 1996. Acting Program Manager, Policy & investigations is to determine whether Interested persons are invited to Reemployment Services, Office of Trade the workers are eligible to apply for submit written comments regarding the Adjustment Assistance.

APPENDIX [Petitions Instituted On 07/01/96]

Date of TA±W Subject firm (petitioners) Location petition Product(s)

32,486 ..... Ambrose Uniform Div (Wkrs) ...... Ambrose, GA ...... 05/15/96 Men's, Ladies' Lab Coats and Shirts. 32,487 ..... Savannah Manufacturing (Comp) ...... Savannah, TN ...... 06/07/96 Sportswear. 32,488 ..... Big J Apparel (Wkrs) ...... Waco, TX ...... 06/10/96 Men's, Ladies' and Boy's Jeans. 32,489 ..... Aquila, Inc (Wkrs) ...... Superior, WI ...... 06/08/96 Knitwear. 32,490 ..... Tempered Spring, Inc (Wkrs) ...... Jackson, MI ...... 06/11/96 Engine Valve Springs. 32,491 ..... DeLong Sportswear (Wkrs) ...... Lynchburg, TN ...... 06/13/96 Wool Jackets. 32,492 ..... American Tourister (Comp) ...... Warren, RI ...... 06/11/96 Hard Side Luggage. 32,493 ..... American Tourister (Comp) ...... Jacksonville, FL ...... 06/11/96 Hard Side Luggage. 32,494 ..... General Belt (Wkrs) ...... New York, NY ...... 06/11/96 Leather Belts. 32,495 ..... Eaton Corp, Golf Grip Div (Comp) ...... Laurinburg, NC ...... 06/13/96 Golf Grips. 32,496 ..... Custom Wood Products (Wkrs) ...... St. Joseph, MO ...... 06/10/96 Wood Sash Windows. 32,497 ..... Lakedale Manufacturing (Comp) ...... Fayetteville, NC ...... 06/18/96 Children's Swimwear and Outerwear. 32,498 ..... Lucent Technologies (CWA) ...... Lee's Summit, MO ...... 06/19/96 Electronic Connectors. 32,499 ..... Alden Electronics (Comp) ...... Westboro, MA ...... 06/07/96 Radio Beacons. 32,500 ..... Monsanto Chemical Co (ICWU) ...... St. Louis, MO ...... 06/13/96 Chemicals. 32,501 ..... C.F. Hathaway Co (UNITE) ...... Waterville, ME ...... 06/18/96 Men's Shirts. 32,502 ..... V.R. Fashions, Inc (Wkrs) ...... Waco, TX ...... 06/12/96 Men's Athletic Wear. 32,503 ..... Mobil Admin. Services Co (Wkrs) ...... Dallas, TX ...... 06/05/96 Oil, Gasoline, Lubricants. 32,504 ..... H.S. Novelty (Comp) ...... Fultonville, NY ...... 06/17/96 Exotic Leathers. 32,505 ..... St. Marys Carbon Co. (IUE) ...... St. Marys, PA ...... 06/19/96 Electrical and Mechanical Components. 32,506 ..... Jenn Air-Magic Chef (Wkrs) ...... Indianapolis, IN ...... 06/13/96 Cooking Ranges and Ovens. 32,507 ..... Drive N Surf, Inc (Comp) ...... Torrance, CA ...... 06/19/96 Neoprene Wetsuits. 32,508 ..... Truck-Lite Co., Inc (Wkrs) ...... Falconer, NY ...... 05/31/96 Automotive Safety Lights.

[FR Doc. 96–18639 Filed 7–22–96; 8:45 am] published in the Federal Register on The amended notice applicable to BILLING CODE 4510±30±M May 17, 1996 (61 FR 24960). TA–W–32,156 is hereby issued as At the request of the company, the follows: Department reviewed the certification All workers of Lucia, Incorporated, [TA±W±32,156 and TA±W±32,156A] for workers of the subject firm. New Winston-Salem, North Carolina (TA–W– information provided by the company 32,156), and Lucia, Incorporated, Elkin, Lucia, Incorporated, Winston-Salem shows that worker separations have North Carolina (TA–W–32,156A) who and Elkin, North Carolina; Amended occurred at the subject firms’ Elkin, became totally or partially separated from Certification Regarding Eligibility To North Carolina location. The workers employment on or after March 21, 1995 are Apply for Worker Adjustment are engaged in the production of ladies’ eligible to apply for adjustment assistance Assistance coordinated sportswear. under Section 223 of the Trade Act of 1974. The intent of the Department’s Signed at Washington, DC this 11th day of In accordance with Section 223 of the certification is to include all workers of July 1996. Trade Act of 1974 (19 U.S.C. 2273) the the subject firm who were adversely Curtis K. Kooser, Department of Labor issued a affected by increased imports of ladies’ Acting Program Manager, Policy and Certification of Eligibility to Apply for coordinated sportswear. Accordingly, Reemployment Services, Office of Trade Worker Adjustment Assistance on April the Department is amending the Adjustment Assistance. 29, 1996, applicable to all workers of certification to cover the workers of [FR Doc. 96–18631 Filed 7–22–96; 8:45 am] Lucia, Incorporated, Winston-Salem, Lucia, Incorporated, Elkin, North North Carolina. The notice was Carolina. BILLING CODE 4510±30±M 38222 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Maxus Energy Corp. et.al.; Amended after June 30, 1994, are eligible to apply for The amended notice applicable to Certification Regarding Eligibility To adjustment assistance under Section 223 of TA–W–30,896 is hereby issued as Apply for Worker Adjustment the Trade Act of 1974. follows: Signed at Washington, D.C. this 5th day of Assistance All workers of Phillips Petroleum July 1986. In accordance with Section 223 of the Company, Exploration and Production Curtis K. Kooser, Group, dba Exploration Division and North Trade Act of 1974 (19 USC 2273) the Acting Program Manager, Policy and American Production Division, Including Department of Labor issued a Notice of Reemployment Services, Office of Trade General Counsel, Bartlesville, Oklahoma Certification Regarding Eligibility to Adjustment Assistance. (TA–W–30,896), and GPM Gas Services Apply for Worker Adjustment [FR Doc. 96–18634 Filed 7–22–96; 8:45 am] Company, Houston, Texas and all other locations in Texas (TA–W–30,896D), who Assistance on August 8, 1995, BILLING CODE 4510±30±M applicable to workers of Maxus Energy became totally or partially separated from Corporation located in Dallas, Texas. employment on or after March 23, 1994, are eligible to apply for adjustment assistance The notice was published in the Federal under Section 223 of the Trade Act of 1974. Register on August 24, 1995 (60 FR [TA±W±30,896 and TA±W±30,896D] Signed at Washington, DC this 3rd day of 44079). The certification was amended Phillips Petroleum Company, July 1996. October 24, 1995, and again on February Exploration and Production Group, Curtis K. Kooser, 13, 1996, to include workers of the d.b.a. Exploration Division and North Acting Program Manager, Policy and subject firm whose wages were being American Production Division Reemployment Services, Office of Trade reported to the Maxus Corporate and the (Including General Counsel), Adjustment Assistance. Maxus International unemployment Bartlesville, Oklahoma and GPM Gas [FR Doc. 96–18633 Filed 7–22–96; 8:45 am] insurance (UI) tax accounts. The notices Services Company, Houston, Texas, BILLING CODE 4510±30±M were published in the Federal Register and All Other Locations in Texas; on November 7, 1995 (60 FR 56172), Amended Certification Regarding [TA±W±32,253] and February 28, 1996 (61 FR 7540), Eligibility To Apply for Worker respectively. Adjustment Assistance At the request of the State agency, the Pioneer Manufacturing, Incorporated, Department reviewed the certification Salisbury, NC; Notice of Revised In accordance with Section 223 of the Determination of Reconsideration for workers of the subject firm. New Trade Act of 1974 (19 U.S.C. 2273) the information provided by the State Department of Labor issued a On May 14, 1996, the Department shows that some of the workers of the Certification of Eligibility to Apply for issued a Negative Determination subject firm had there UI taxes reported Worker Adjustment Assistance on May Regarding Eligibility to Apply for to a separate UI tax account, Midgard 3, 1995, applicable to all workers of Worker Adjustment Assistance, Energy Company. The Company reports Phillips Petroleum Company, applicable to all workers of Pioneer that Maxus Energy Corporation has Exploration and Production Group, dba Manufacturing, Incorporated located in changed its name to Midgard Energy Exploration Division and North Salisbury, North Carolina. The notice Company. Additionally, the State American Production Division, was published in the Federal Register reports that Riverside Farms, Hamilton, Bartlesville, Oklahoma, all other on June 6, 1996 (FR 61 28899). Texas, TA–W–31, 280, is the dba name Oklahoma locations, and other locations By letter of May 30, 1996, the for Leon Properties, Diamond S. Ranch. in various States. The notice was company official requested Accordingly, the Department is again published in the Federal Register on administrative reconsideration of the amending the certification to reflect May 17, 1995 (60 FR 26459). The worker Department’s findings. these matters. certification was amended May 23, 1996 The company presented new evidence The intent of the Department’s to include the General Counsel worker that was not considered in the original certification is to include all workers of group. The notice was published in the determination. The company official Maxus who were affected by increased Federal Register on June 6, 1996 (61 FR showed that one of their major imports of crude oil and natural gas. 28901). customers, beginning June 1996, is The amended notice applicable to transferring production of boy’s suits to At the request of petitioners and a TA–W–31, 268 through TA–W–31, 282, Mexico, which will be imported back to company official, the Department is hereby issued as follows: the United States. reviewed the certification for workers of Other findings on reconsideration All workers of Maxus Energy Corporation, the subject firm. The GPM Gas Services a/k/a/ Maxus Corporate, a/k/a/ Maxus reveal that the quantity of aggregate U.S. International, a/k/a/ Midgard Energy Company located in Houston, Texas was imports of men’s and boys’ suits Company, Dallas, Texas (TA–W–31, 268), not explicitly cited in the certification. increased dramatically from 1994 to Kearny, New Jersey (TA–W–31, 269), and all However, new findings show that GPM 1995. related locations of the Maxus Exploration is a separate division of Phillips Company, Amarillo, Texas (TA–W–31, 270), Petroleum Company. Employees of GPM Conclusion Canadian, Texas (TA–W–31, 271), Dumas, process natural gas and extract natural After careful review of the additional Texas (TA–W–31, 272), Jeanerette, Louisiana gas liquids. (TA–W–31, 273), Pampa, Texas (TA–W–31, facts obtained on reconsideration, I 274), Perryton, Texas (TA–W–31, 275), The intent of the Department’s concluded that increased imports of Leedey, Oklahoma (TA–W–31, 276), certification is to include all workers of articles like or directly competitive with Spearman, Texas (TA–W–31, 277), Stinnett, Phillips Petroleum adversely affected by boys’ suits contributed importantly to Texas (TA–W–31, 278); Maxus Aviation imports of crude oil and natural gas. the declines in sales or production and Company, Dallas, Texas (TA–W–31, 279); Accordingly, the Department is to the total or partial separation of Riverside Farms, dba Leon Properties, amending the worker certification to workers of Pioneer Manufacturing, Diamond S. Ranch, Dallas, Texas (TA–W–31, 280); Riverside Lodge, Hamilton, Texas (TA– specifically provide coverage to GPM Incorporated, in Salisbury, North W–31, 281); and Sunray Gas Plant, Dumas, Gas Service Company located in Carolina. In accordance with the Texas (TA–W–31, 282) who become totally or Houston and other locations within the provisions of the Act, I make the partially separated from employment on or State of Texas. following certification: Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38223

All workers of Pioneer Manufacturing, of Subchapter D, Chapter 2, Title II, of request a public hearing with the Incorporated, Salisbury, North Carolina who the Trade Act of 1974, as amended, are Program Manager of OTAA at the U.S. became totally or partially separated from identified in the Appendix to this Department of Labor (DOL) in employment on or after April 9, 1995, are Notice. Upon notice from a Governor eligible to apply for adjustment assistance Washington, DC provided such request under Section 223 of the Trade Act of 1994. that a NAFTA–TAA petition has been is filed in writing with the Program received, the Program Manager of the Signed at Washington, D.C. this 3rd day of Manager of OTAA not later than August July 1996. Office of Trade Adjustment Assistance 2, 1996. Curtis K. Kooser, (OTAA), Employment and Training Administration (ETA), Department of Also, interested persons are invited to Acting Program Manager, Policy and submit written comments regarding the Reemployment Service, Office of Trade Labor (DOL), announces the filing of the petition and takes actions pursuant to subject matter of the petitions to the Adjustment Assistance. Program Manager of OTAA at the [FR Doc. 96–18629 Filed 7–22–96; 8:45 am] paragraphs (c) and (e) of Section 250 of the Trade Act. address shown below not later than BILLING CODE 4510±30±M The purpose of the Governor’s actions August 2, 1996. and the Labor Department’s Petitions filed with the Governors are Investigations Regarding Certifications investigations are to determine whether available for inspection at the Office of of Eligibility to Apply for NAFTA the workers separated from employment the Program Manager, OTAA, ETA, Transitional Adjustment Assistance of after December 8, 1993 (date of DOL, Room C–4318, 200 Constitution enactment of Pub. L. 103–182) are Avenue NW., Washington, DC 20210. Petitions for transitional adjustment eligible to apply for NAFTA–TAA under assistance under the North American Subchapter D of the Trade Act because Signed at Washington, DC this 2nd day of Free Trade Agreement–Transitional of increased imports from or the shift in July, 1996. Adjustment Assistance Implementation production to Mexico or Canada. Curtis K. Kooser, Act (Pub. L. 103–182), hereinafter called The petitioners or any other persons Acting Program Manager, Policy & (NAFTA–TAA), have been filed with showing a substantial interest in the Reemployment Services, Office of Trade State Governors under Section 250(b)(1) subject matter of the investigations may Adjustment Assistance.

APPENDIX

Date received at Petitioner (union/workers/firm) Location Governor's Petition No. Articles produced office

Airshield Corporation (Wkrs) ...... Brownsville, TX ...... 06/10/96 NAFTA±01064 Fiberglass components. Oxford of Burgaw (Co.) ...... Burgan, NC ...... 06/10/96 NAFTA±01065 Ladies sportswear and dresses. Oneita Industries, Inc.; Fingerville Tex- Fingerville, SC ...... 06/06/96 NAFTA±01066 Fabric for T-shirts. tile Plant (Wkrs). Wallace and Tiernan, Inc. (Co.) ...... Belleville, NJ ...... 06/10/96 NAFTA±01067 Hydraulic diaphragm pumps. Hickory Hill Industries (Co.) ...... Clifton, TN ...... 06/14/96 NAFTA±01068 Childrens sportswear. Columbia Gas System (Wkrs) ...... Charleston, WV ...... 06/10/96 NAFTA±01069 Gas. Blue Mountain Forest Products (Wkrs) Long Creek, OR ...... 06/11/96 NAFTA±01070 Rough Lumber. Sara Lee Knit Product (Co.) ...... Eatonton, GA ...... 06/10/96 NAFTA±01071 Ladies Panties. General Electric ...... Erie, PA ...... 06/12/96 NAFTA±01072 Dynometer and Dragline. Therm-O-Disc, Inc.; Subsidiary of Em- Newaygo, MI ...... 06/11/96 NAFTA±01073 Electronic components. erson Electric (Wkrs). Alden Electronics (Wkrs) ...... Westboro, MA ...... 06/12/96 NAFTA±01074 SATFIND±406 emergency position indicator radio beacon. Varsity Manufacturing (Co.) ...... Susqnehanna, PA ...... 06/12/96 NAFTA±01075 Ladies sleepwear. United Sports Apparel (Co.) ...... Pelham, TN ...... 06/12/96 NAFTA±01076 Warm-up suits, Jackets. Beaufab Mills, Inc. (UTWA) ...... Stoudsbury, PA ...... 06/12/96 NAFTA±01077 Lining fabrics and costume fabrics. Truck-Lite; 310 E. Elmwood Ave. Falconer, NY ...... 06/14/96 NAFTA±01078 Automotive car safety lights. (Wkrs). Yakima Products, Inc. (Co.) ...... Arcata, CA ...... 06/13/96 NAFTA±01079 Components for car roof racks (assembly and fabrication). Mabex Universal Corp. (Co.) ...... San Diego, CA ...... 06/13/96 NAFTA±01080 Plastic packaging for the electronics industry. Nestaway Canal Wire Facility (Co.) ...... Canal Winchester, OH ...... 06/13/96 NAFTA±01081 Dishwasher racks and components. Magnetex (Co.) ...... Blytheville, AR ...... 06/13/96 NAFTA±01082 High Intensity Discharge ballast. Philips Lighting (Wkrs) ...... Little Rock, AR ...... 06/12/96 NAFTA±01083 Lamps and bulbs. Forsyth Public School District (Wkrs) ... Forsyth, MT ...... 06/14/96 NAFTA±01084 Public school teachers. Lee Thomas (Co.) ...... Los Angeles, CA ...... 06/13/96 NAFTA±01085 Sewing factory. Simpson Paper Company ...... Pomona, CA ...... 06/20/96 NAFTA±01086 Paper. Chase Ergonomic (Co.) ...... Albuquerque, NM ...... 06/24/96 NAFTA±01087 Industrial safety products. Boise Cascade (Wkrs) ...... Medford, OR ...... 06/17/96 NAFTA±01088 Lumber. Superior Milling Ltd. (Wkrs) ...... Adrian, MI ...... 06/19/96 NAFTA±01089 Green lumber. Eaton Corporation; Golf Grip Division Laurinburg, NC ...... 06/20/96 NAFTA±01090 Golf grips. (Co.). Lakedale Mag, Inc. (Co.) ...... Fayetteville, NC ...... 06/20/96 NAFTA±01091 Girls swimwear, boys and girls outerwear. Lucent TechnologiesÐMicroekc-tronics Lee's Summit, MO ...... 06/20/96 NAFTA±01092 Electronic connectors. (CWA). Trust Joist International (OCAW) ...... Hawkins, WI ...... 06/20/96 NAFTA±01093 Wood window units. 38224 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

APPENDIXÐContinued

Date received at Petitioner (union/workers/firm) Location Governor's Petition No. Articles produced office

BP Exploration and Oil, Inc.; Paulsboro Paulsboro, NJ ...... 06/17/96 NAFTA±01094 Receiving and distributing refined pe- Terminal Division (Wkrs). troleum products. Hexfet America (Wkrs) ...... Temecula, CA ...... 06/28/96 NAFTA±01095 Assembly part of semi-conductor. Clevemont Mills (Wkrs) ...... Kings Mountain, NC ...... 06/10/96 NAFTA±01096 Sweat pants and shirts. ROL Manufacturing of America, Inc. Brownsville, TN ...... 06/17/96 NAFTA±01097 Motor gaskets for cars and light line. (Wkrs). Daniels McCray Lumber Company; St. Joseph, MO ...... 06/19/96 NAFTA±01098 Window sashes. Custom Wood Products Division (Wkrs). Stream International (Wkrs) ...... Lindon, UT ...... 06/17/96 NAFTA±01099 Software. Automed, Inc. (Wkrs) ...... Arden Hills, MN ...... 06/24/96 NAFTA±01100 Labor specimen. Jatco (Wkrs) ...... Shellman, GA ...... 06/24/96 NAFTA±01101 Lakeview Lumber (Wkrs) ...... Lakeview, OR ...... 06/24/96 NAFTA±01102 Timber receipts. International Paper Company (LSW) .... Veneta, OR ...... 06/24/96 NAFTA±01103 Paper. Munro and Company, Inc.; Clear Lake Hot Springs, AR ...... 06/28/96 NAFTA±01104 Footwear. Footwear (Wkrs). BP America, Inc.; BP Oil and Explo- Cleveland, OH ...... 06/25/96 NAFTA±01105 Petroleum products. ration, Inc. (OCWA). Pioneer Cut Stock, Inc. (Wkrs) ...... Prineville, OR ...... 06/26/96 NAFTA±01106 Wood products. Jenn Air; Maytag ...... Indianapolis, IN ...... 06/25/96 NAFTA±01107 Home cooking appliances. Orbit Industries, Inc. (Co.) ...... Helen, GA ...... 06/26/96 NAFTA±01108 Ladies sportswear. Fender Musical Instruments, Inc. Lake Oswego, OR ...... 06/27/96 NAFTA±01109 Solid-state amplifiers. (Wkrs). Jolie Handbag (Wkrs) ...... Hialegh, FL ...... 06/27/96 NAFTA±01110 Handbags. Lloyd-Smith Company; Oil Field Too Bradford, PA ...... 06/28/96 NAFTA±01111 Fishing tools. Ship (Co.). McDonnell Douglas; Douglas Aircraft Torrance, CA ...... 06/27/96 NAFTA±01112 Assembly and sub-assembly. Division (IAM).

[FR Doc. 96–18637 Filed 7–22–96; 8:45 am] (OTAA), Employment and Training Washington, DC provided such request BILLING CODE 4510±30±M Administration (ETA), Department of is filed in writing with the Program Labor (DOL), announces the filing of the Manager of OTAA not later than August petition and takes actions pursuant to 2, 1996. Investigaitons Regarding Certifications paragraphs (c) and (e) of Section 250 of Also, interested persons are invited to of Eligibility To Apply For NAFTA the Trade Act. submit written comments regarding the Transitional Adjustment Assistance The purpose of the Governor’s actions subject matter of the petitions to the and the Labor Department’s Program Manager of OTAA at the Petitions for transitional adjustment investigations are to determine whether address shown below not later than assistance under the North American the workers separated from employment August 2, 1996. Free Trade Agreement-Transitional of after December 8, 1993 (date of Adjustment Assistance Implementation enactment of P. L. 103–182) are eligible Petitions filed with the Governors are Act (P. L. 103–182), hereinafter called to apply for NAFTA–TAA under available for inspection at the Office of (NAFTA–TAA), have been filed with Subchapter D of the Trade Act because the Program Manager, OTAA, ETA, State Governors under Section 250(b)(1) of increased imports from or the shift in DOL, Room C–4318, 200 Constitution of Subchapter D, Chapter 2, Title II, of production to Mexico or Canada. Avenue, NW., Washington, DC 20210. the Trade Act of 1974, as amended, are The petitioners or any other persons Signed at Washington, DC this 16th day of identified in the Appendix to this showing a substantial interest in the July, 1996. Notice. Upon notice from a Governor subject matter of the investigations may Russell Kile, that a NAFTA–TAA petition has been request a public hearing with the Acting Program Manager, Policy & received, the Program Manager of the Program Manager of OTAA at the U.S. Reemployment Services, Office of Trade Office of Trade Adjustment Assistance Department of Labor (DOL) in Adjustment Assistance.

APPENDIX

Date received at Petitioner (union/workers/firm) Location Governor's Petition No. Articles produced office

DM IV, Inc. (Co.) ...... Centerville, TN ...... 06/28/96 NAFTA±01113 Children's clothing. Beck Arnley World Parts Corp. () ...... Pittsburgh, PA ...... 07/01/96 NAFTA±01114 Auto parts. Delong Sportswear (Wkrs)...... Lynchburg, TN ...... 06/24/96 NAFTA±01115 Award jackets. Nu-Tech Precision Metals, Inc. (Wkrs) ..... Waterbury, CT ...... 07/01/96 NAFTA±01116 Metals. Lodestar Industrial Contractors (Co.)...... Colville, WA ...... 07/08/96 NAFTA±01117 KL Manufacturing Co., Inc. (Wkrs) ...... Post Falls, ID ...... 07/08/96 NAFTA±01118 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38225

APPENDIXÐContinued

Date received at Petitioner (union/workers/firm) Location Governor's Petition No. Articles produced office

Dean Foods Vegetable Company; Norcal Watsonville, CA ...... 07/08/96 NAFTA±01119 Vegetable manufacturing. Crosetti Foods (NC Company) (). Northern Engraving () ...... LaCrosse, WI ...... 07/10/96 NAFTA±01120 Engraved products. Maclin Company (Co.) ...... Industry, CA ...... 07/09/96 NAFTA±01121 Garden hose. Texberry Container Corp. (Wkrs) ...... Houston, TX ...... 07/10/96 NAFTA±01122 Flexel () ...... Tecumseh, KS ...... 07/11/96 NAFTA±01123 Cellophane. Uniroyal Technology () ...... Mishawaka, IN ...... 07/10/96 NAFTA±01124 Adhesives and sealants. Oak Grigsby (Wkrs) ...... Sugar Grove, IL ...... 07/09/96 NAFTA±01125 Electrical components and switches. Perry Manufacturing Company; Pellamy Richlands, NC ...... 07/05/96 NAFTA±01126 Clothing. Manufacturing Company (Co.). Private Western Brands (Co.) ...... El Paso, TX ...... 07/11/96 NAFTA±01127 Western boots. J and M Apparel (Wkrs) ...... Finger, TN ...... 06/28/96 NAFTA±01128 Clothing. El Paso Apparel Group ...... El Paso, TX ...... 07/12/96 NAFTA±01129 Women's apparel. ACT Marine (Wkrs) ...... Everson, WA ...... 07/15/96 NAFTA±01130 Netting, extruder, braiding.

[FR Doc. 96–18640 Filed 7–22–96; 8:45 am] Occupational Safety and Health • evaluate the accuracy of the BILLING CODE 4510±30±M Administration agency’s estimate of the burden of the proposed collection of information, Proposed Collection; Comment including the validity of the Request [NAFTAÐ00927] methodology and assumptions used; ACTION: Notice. • enhance the quality, utility, and Ogden Atlantic Design, Poughkeepsie, clarity of the information to be NY; Notice of Affirmative SUMMARY: The Department of Labor, as collected; and part of its continuing effort to reduce Determination Regarding Application • minimize the burden of the for Reconsideration paperwork and respondent burden, conducts a preclearance consultation collection of information on those who are to respond, including through the By letter of May 30, 1996, the program to provide the general public and Federal agencies with an use of appropriate automated, petitioners requested administrative opportunity to comment on proposed electronic, mechanical, or other reconsideration of the Department of and/or continuing collections of technological collection technique or Labor’s Notice of Negative information in accordance with the other forms of information technology, Determination Regarding Eligibility for Paperwork Reduction Act of 1995 e.g., permitting electronic submissions Workers of Ogden Atlantic Design to (PRA95) [U.S.C. 3506(c)(2)(A]. This of responses. Apply for NAFTA-Transitional program helps to ensure that requested Adjustment Assistance. The denial ADDRESSES: Comments are to be data can be provided in the desired submitted to the Docket Office, Docket notice was signed on May 8, 1996, and format, reporting burden (time and No. ICR 96–9, U.S. Department of Labor, published in the Federal Register on financial resources) is minimized, Room N–2625, 200 Constitution May 24, 1996 (61 FR 26219). collection instruments are clearly Avenue, NW., Washington, DC 20210, The petitioners present new understood, and the impact of collection telephone number (202) 219–7894. information on customers of the subject requirements on respondents can be Written comments limited to 10 pages firm that have increased reliance on properly assessed. Currently the or less in length may also be transmitted imports of printed circuit boards from Occupational Safety and Health by facsimile to (202) 219–5046. Mexico. Administration is soliciting comments concerning the proposed extension of FOR FURTHER INFORMATION CONTACT: Conclusion the information collection request for Anne C. Cyr, Office of Information and the Temporary Labor Camps standard Consumer Affairs, Occupational Safety After careful review of the 29 CFR 1910.142. A copy of the and Health Administration, U.S. application, I conclude that the claim is proposed information collection request Department of Labor, Room N–3647, of sufficient weight to justify (ICR) can be obtained by contacting the 200 Constitution Avenue, NW., reconsideration of the Department of employee listed below in the addressee Washington, DC 20210. Telephone: Labor’s prior decision. The application section of this notice. (202) 219–8148. Copies of the is, therefore, granted. DATES: Written comments must be referenced information collection Signed at Washington, D.C., this 3rd day of submitted to the office listed in the request are available for inspection and July 1996. addressee section below on or before copying in the Docket Office and will be Curtis K. Kooser, September 23, 1996. The Department of mailed immediately to persons who Labor is particularly interested in Acting Program Manager, Policy and request copies by telephoning Vivian comments which: Allen at (202) 219–8076. For electronic Reemployment Services, Office of Trade • Adjustment Assistance. evaluate whether the proposed copies of the Temporary Labor Camps [FR Doc. 96–18627 Filed 7–22–96; 8:45 am] collection of information for the proper Information Collection Request, contact performance of the functions of the the Labor News Bulletin Board, (202) BILLING CODE 4510±30±M agency, including whether the 219–4784; or ISHA’s WebPage on the information will have practical utility; Internet at http://www.osha.gov/. 38226 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

SUPPLEMENTARY INFORMATION: paperwork and respondent burden Department of Labor, Room N–3647, I. Background conducts a preclearance consultation 200 Constitution Ave., NW., program to provide the general public Washington DC 20210. Telephone: (202) The Temporary Labor Camps standard and Federal agencies with an 219–8148. Copies of the reference and its information collection is opportunity to comment on proposed information collection request are designed to eliminate the incidence of and/or continuing collections of available for inspection and copying in communicable disease among information in accordance with the the Docket Office and will be mailed Temporary Labor Camp residents. The Paperwork Reduction Act of 1995 immediately to persons who request standard requires camp superintendent (PRA95) [44 U.S.C. 3506(c)(2)(A)]. This copies by telephoning Vivian Allen at to report immediately to the local health program helps to ensure that requested (202) 219–8076. For electronic copies of officer the name and address of any data can be provided in the desired the OSHA Data Collection Initiative individual in the camp known to have format, reporting burden (time and Request, contact the Labor News or suspected of having a communicable financial resources) is minimized, Bulletin Board (202) 219–4784; or disease, suspected food poisoning or an collection instruments are clearly OSHA’s WebPage on Internet at http:// unusual prevalence of any illness in understood, and the impact of collection www.osha.gov/. which fever, diarrhea, sore throat, requirements on respondents can be vomiting, or jaundice is a prominent properly assessed. Currently, the SUPPLEMENTARY INFORMATION: symptom. Occupational Safety and Health I. Background II. Current Actions Administration is soliciting comments concerning the proposed extension of Description: To meet many of OSHA’s This notice requests an extension of the information collection request for program needs, OSHA is proposing to the current OMB approval of the the OSHA Data Collection Initiative. A continue their data initiative to collect paperwork requirements in the copy of the proposed information occupational injury and illness data and Temporary Labor Camps Standard. collection request (ICR) can be obtained information on number of workers Extension is necessary to provide by contacting the office listed below in employed and number of hours worked continued protection to employees from the addressee section of this notice. from establishments in portions of the the health hazards associated with the DATES: Written comments must be private sector. OSHA will collect data outbreak of communicable diseases. submitted to the office listed in the from 80,000 employers with 50 or more Type of Review: Extension. addressee section below on or before employees in selected high hazard Agency: Occupational Safety and September 23, 1996. The Department of industries, selected employers who have Health Administration. Labor is particularly interested in had OSHA interventions in 1994, 1995 Title: Temporary Labor Camps. comments which: or 1996, and employers who are to be OMB Number: 1218–0096. * evaluate whether the proposed involved in the agency Cooperative Agency Number: Docket Number ICR collection of information is necessary Compliance Program (CCP). These data 96–9. for the proper performance of the will allow OSHA to calculate Affected Public: Business and other functions of the agency, including occupational injury and illness rates for-profit, Federal and State whether the information will have and to focus its efforts on individual government, Local or Tribal practical utility; workplaces with ongoing serious safety governments. * evaluate the accuracy of the and health problems. Successful Total Respondents: 7,161. agency’s estimate of the burden of the implementation of the data collection Frequency: On Occasion. proposed collection of information, initiative is critical to OSHA’s Total Responses: 1,379. reinvention efforts and the data Average Time per Response: 5 including the validity of the requirements tied to the Government minutes to report the incident to the methodology and assumptions used; Performance and Results Act (GPRA). local health officer. * enhance the quality, utility, and clarity of the information to be Estimated Total Burden Hours: 75. II. Current Actions Estimated Capital, Operation/ collected; and Maintenance Burden Cost: $0. * minimize the burden of the This notice requests an extension of collection of information on those who the current OMB approval of the Comments submitted in response to are to respond, including through the this notice will be summarized and/or paperwork requirements for the OSHA use of appropriate automated, Data Collection Initiative. Extension is included in the request for Office of electronic, mechanical, or other Management and Budget approval of the necessary to endure that the Agency technological collection techniques or continues to obtain establishment data information collection request; they will other forms of information technology, also become a matter of public record. necessary to carry on with the e.g., permitting electronic submissions development and expansion of the New Dated: July 16, 1996. of responses. OSHA. This will allow the Agency to Adam M. Finkel, ADDRESSES: Comments are to be deal with a larger number of employers Director, Directorate of Health Standards submitted to the Docket Office, Docket without massive increases in resources, Programs. No. ICR–96–6, U.S. Department of will reduce intrusive interventions in [FR Doc. 96–18625 Filed 7–22–96; 8:45 am] Labor, Room N–2625, 200 Constitution workplaces that are relatively safe, and BILLING CODE 4510±26±M Ave. NW., Washington, DC 20210, will lead to improved workplace safety telephone (202) 219–7894. Written and health for America’s workers. In comments limited to 10 pages or less in addition, OSHA will be able to proceed Proposed Collection; Comment length may also be transmitted by with its GPRA requirements to monitor Request facsimile to (202) 219–5046. the results of agency activities, quantify ACTION: Notice. FOR FURTHER INFORMATION CONTACT: and evaluate the successes and failure of Anne Cyr, Office of Information and its various programs based on program SUMMARY: The Department of Labor, as Consumer Affairs, Occupational Safety results, identify the most efficient and part of its continuing effort to reduce and Health Administration, U.S. effective program mix, and promote the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38227 development of programs and policies Agency Number: Docket Number ICR– Frequency: Annually. based on outcome data. 96–6. Total Responses: 80,000. Type of Review: Extension. Affected Public: Business or other for- Agency: Occupational Safety and profit. Average Time per Response: 30 Health Administration. Cite/Reference/Form/etc: OSHA Form minutes. Title: OSHA Data Collection Initiative. 196A and OSHA Form 196B. Estimated Total Burden Hours: 35,000 OMB Number: 1218–0209. Total Respondents: 80,000. hours.

Average time Cite/reference Total Frequency Total per response Burden respondents responses (minutes) (hours)

OSHA Form 196A ...... 10,000 Annually ... 10,000 30 (*) OSHA Form 196B ...... 70,000 Annually ... 70,000 30 35,000

Total Burden Cost (capital/startup/ NASA Case No. MFS–28–958–1: Acquisition Technologies for Real-Time operating/maintenance): $0. Dynamically Timed Electric Motor; and Retrospective Analysis,’’ for which Comments submitted in response to NASA Case No. MFS–28–852–1: a U.S. Patent Application was filed by this comment request will be Ampoule Failure Sensor; the United States of America as summarized and/or included in the NASA Case No. MFS–28–986–1: represented by the Administrator of the request for Office of Management and Apparatus for Diffusion Controlled National Aeronautics and Space Budget approval of the information Dialysis Under Microgravity Administration. Written objections to collection request; they will also Conditions; the prospective grant of a license should become a matter of public record. NASA Case No. MFS–28–989–1: Protein be sent to Mr. George F. Helfrich, Patent Dated: July 10, 1996. Crystal Growth Apparatus for Counsel, Langley Research Center. Stephen A. Newell, Microgravity; DATES: Responses to this notice must be NASA Case No. MFS–28–997–1: Director, Office of Statistics. received by September 23, 1996. Automatic Locking Knee Brace Joint; FOR FURTHER INFORMATION CONTACT: Mr. [FR Doc. 96–18626 Filed 7–22–96; 8:45 am] NASA Case No. MFS–28–994–1: Means George F. Helfrich, Patent Counsel, BILLING CODE 4510±26±M for Positioning & Repositioning Langley Research Center, Mail Code Scanning Instruments; NASA Case No. MFS–28–985–1: Device 212, Hampton, VA 23681; telephone NATIONAL AERONAUTICS AND and Method for Screening (757) 864–9260; fax (757) 864–9190. SPACE ADMINISTRATION Crystallization Conditions in Solution Dated: July 17, 1996. [Notice (96±086)] Crystal Growth; Edward A. Frankle, NASA Case No. MFS–28–402–2: General Counsel. Government-Owned Inventions, Biologically Active Protein Fragments [FR Doc. 96–18598 Filed 7–22–96; 8:45 am] Available for Licensing Containing Specific Binding Regions BILLING CODE 7510±01±M of Serum Albumin or Related AGENCY: National Aeronautics and Proteins; Space Administration. NASA Case No. SSC–00006–2: [Notice (96±085)] ACTION: Notice of availability of Electronic Clinical Thermometer; inventions for licensing. NASA Case No. MFS–28–829–2: Quick- Notice of Prospective Patent License SUMMARY: The inventions listed below Connect Bolt; AGENCY: National Aeronautics and are assigned to the National Aeronautics NASA Case No. MFS–28–793–1: Dual Space Administration. and Space Administration, have been Brushless Resolver Rate Sensor. ACTION: Notice of prospective patent filed in the United States Patent and Dated: July 17, 1996. license. Trademark Office, and are available for Edward A. Frankle, SUMMARY: NASA hereby gives notice licensing. General Counsel. that Consulting Associates, Inc., of Copies of patent applications cited are [FR Doc. 96–18602 Filed 7–22–96; 8:45 am] available from the Office of Patent Chesapeake, VA 23320–2637, has BILLING CODE 7510±01±M Counsel, Marshall Space Flight Center, applied for a partially exclusive license Mail Code CC01, Huntsville, AL 35812. to practice the invention described in Claims are deleted from the patent [Notice (96±082)] U.S. Patent No. 5,377,100, entitled applications to avoid premature ‘‘Method of Encouraging Attention by disclosure. Notice of Prospective Patent License Correlating Video Game Difficulty with Attention Level,’’ which was issued on DATES: July 23, 1996. AGENCY: National Aeronautics and December 27, 1994, to the United States FOR FURTHER INFORMATION CONTACT: Space Administration. Robert L. Broad, Jr., Patent Counsel, of America as represented by the ACTION: Notice of prospective patent Administrator of the National Marshall Space Flight Center, Mail Code license. CC01, Huntsville, AL 35812; telephone Aeronautics and Space Administration. (205) 544–0021, fax (205) 544–0258: SUMMARY: NASA hereby gives notice Written objections to the prospective NASA Case No. MFS–28–973–1: that Consulting Associates, Inc., of grant of a license should be sent to Mr. Apparatus for Assisting Childbirth; Chesapeake, VA 23320–2637, has George F. Helfrich, Patent Counsel, NASA Case No. MFS–28–839–1: applied for a partially exclusive license Langley Research Center. Crystals of Serum Albumin for Use in to practice the invention disclosed in DATES: Responses to this notice must be Genetic Engineering and Rational NASA Case No. LAR–15367–1, entitled received by September 23, 1996. Drug Design; ‘‘Visually Integrating Multiple Data FOR FURTHER INFORMATION CONTACT: 38228 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Mr. George F. Helfrich, Patent Counsel, [Notice 96±084] Langley Research Center, Mail Code Langley Research Center, Mail Code 212, Hampton, VA 23681; telephone 212, Hampton, VA 23681; telephone Notice of Prospective Patent License (757) 864–9260; fax (757) 864–9190. (757) 864–9260; fax (757) 864–9190. AGENCY: NationalAeronautics and Space Dated: July 17, 1996. Dated: July 17, 1996. Administration. Edward A. Frankle, Edward A. Frankle, ACTION: Notice of prospective patent General Counsel. General Counsel. license. [FR Doc. 96–18599 Filed 7–22–96; 8:45 am] [FR Doc. 96–18601 Filed 7–22–96; 8:45 am] BILLING CODE 7510±01±M SUMMARY: NASA hereby gives notice BILLING CODE 7510±01±M that J & J Engineering, Inc., of Bain Bridge Island, WA 98110, has applied [Notice (96±081)] for a partially exclusive license to [Docket No. 96±080] practice the invention described in U.S. Notice of Prospective Patent License Patent No. 5,377,100, entitled ‘‘Method AGENCY: National Aeronautics and Notice of Prospective Patent License of Encouraging Attention by Correlating Space Administration. Video Game Difficulty with Attention AGENCY: National Aeronautics and Level,’’ which was issued on December ACTION: Notice of prospective patent Space Administration. 27, 1994, to the United States of license. ACTION: America as represented by the Notice of prospective patent SUMMARY: NASA hereby gives notice license Administrator of the National that Wheelock, Inc., of Long Branch, NJ Aeronautics and Space Administration. 07740–6899, has applied for a partially SUMMARY: NASA hereby gives notice Written objections to the prospective exclusive license to practice the that HITCO Technologies, Inc., of grant of a license should be sent to Mr. invention disclosed in NASA Case No. Gardena, California 90249, Materials George F. Helfrich, Patent Counsel, LAR–15138–1, entitled ‘‘Piezoelectric and Electrochemical Research Langley Research Center. Loudspeaker,’’ for which a U.S. Patent Corporation (MER), of Tucson, Arizona DATES: Response to this notice must be Application was filed by the United 85706, P & P Machine Tool, Inc., of received by September 23, 1996. States of America as represented by the Cleveland, Ohio 44146, and Zollner FOR FURTHER INFORMATION CONTACT: Administrator of the National Piston, of Fort Wayne, Indiana 46803, Mr. George F. Helfrich, Patent Counsel, Aeronautics and Space Administration. have each applied for partially exclusive Langley Research Center, Mail Code Written objections to the prospective licenses to practice the following 212, Hampton, VA 23681; telephone grant of a license should be sent to Mr. patented inventions: U.S. Patent No. (757) 864–9260; fax (757) 864–9190. George F. Helfrich, Patent Counsel, 4,683,809, ‘‘LIGHTWEIGHT PISTON’’; Langley Research Center. U.S. Patent No. 4,736,676, Dated: July 17, 1996. DATES: ‘‘COMPOSITE PISTON’’; U.S. Patent Edward A. Frankle, Responses to this notice must be No. 4,909,133, ‘‘LIGHTWEIGHT General Counsel. received by September 23, 1996. PISTON ARCHITECTURE’’; and for the [FR Doc. 96–18600 Filed 7–22–96; 8:45 am] FOR FURTHER INFORMATION CONTACT: Mr. following inventions: NASA Case LAR– BILLING CODE 7510±01±M George F. Helfrich, Patent Counsel, 15,094–1, entitled ‘‘CONCEPT FOR A Langley Research Center, Mail Code 212, Hampton, VA 23681; telephone RINGLESS CARBON-CARBON PISTON [Notice 96±083] IN INTERNAL COMBUSTION (757) 864–9260; fax (757) 864–9190. ENGINES’’; NASA Case No. LAR– Notice of Prospective Patent License Dated: July 17, 1996. 15,462–1, entitled ‘‘INTEGRAL RING Edward A. Frankle, AGENCY: National Aeronautics and CARBON-CARBON PISTON’’; NASA General Counsel. Space Administration. Case No. LAR–15,492–1, entitled [FR Doc. 96–18597 Filed 7–22–96; 8:45 am] ‘‘CARBON-CARBON PISTON ACTION: Notice of prospective patent BILLING CODE 7510±01±M ARCHITECTURES’’; and NASA Case license. No. LAR–15,493–1, entitled ‘‘PISTON AND CYLINDERS MADE OF CARBON- SUMMARY: NASA hereby gives notice CARBON COMPOSITE.’’ Written that Trex Medical Corporation, of NATIONAL SCIENCE FOUNDATION Danbury, CT 06810, has applied for an objections to the prospective grant of a Directorate for Social, Behavioral, and license should be sent to George F. exclusive license to practice the invention disclosed in NASA Case No. Economic Sciences Proposed Data Helfrich, Patent Counsel, Langley Collection: Comment Request Research Center. LAR–15059–1, entitled ‘‘Digital Mammography With A Mosaic of CCD– Comments Requested by September DATES: Responses to this notice must be Arrays,’’ for which a U.S. Patent 17, 1996 received by September 23, 1996. Application was filed by the United In compliance with the requirement FOR FURTHER INFORMATION CONTACT: States of America as represented by the of Section 3506(c)(2)(A) of the Administrator of the National Paperwork Reduction Act of 1995 for George F. Helfrich, Patent Counsel, Aeronautics and Space Administration. Langley Research Center, Mail Code opportunity for public comment on Written objections to the prospective proposed data collection projects, the 212, Hampton, VA 23681; telephone grant of a license should be sent to Mr. (804) 864–9260. National Science Foundation (NSF) will George F. Helfrich, Patent Counsel, publish periodic summaries of proposed Dated: July 17, 1996. Langley Research Center. projects. To request more information Edward A. Frankle, DATES: Responses to this notice must be on the proposed project or to obtain a General Counsel. received by September 23, 1996. copy of the data collection plans and [FR Doc. 96–18596 Filed 7–22–96; 8:45 am] FOR FURTHER INFORMATION CONTACT: Mr. instruments, call the NSF Clearance BILLING CODE 7510±01±M George F. Helfrich, Patent Counsel, Officer on (703) 306–1243. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38229

Comments are invited on (a) Whether would receive their previous year’s data NUCLEAR REGULATORY the proposed collection of information and a complete program for editing and COMMISSION is necessary for the proper performance trend checking. Respondents will be [Docket Nos. 50±272 and 50±311] of the functions of the agency, including encouraged to participate in these whether the information shall have initiatives should they so wish. Public Service Electric and Gas practical utility; (b) the accuracy of the Traditional paper questionnaires will Company Salem Nuclear Generating agency’s estimate of the burden of the also be available, with editing and trend Station, Units 1 and 2; Notice of proposed collection of information; (c) checking performed as part of the Consideration of Issuance of ways to enhance the quality, utility, and survey processing. Amendments to Facility Operating clarity of the information to be Licenses, Proposed No Significant collected; and (d) ways to minimize the In Fall 1994, the survey achieved a total response rate of 98.9% for Hazards Consideration Determination, burden of the collection of information and Opportunity for a Hearing on respondents, including through the institutions and 96.0% for departments. use of automated collection techniques Burden estimates are as follows: The U.S. Nuclear Regulatory or other forms of information Commission (the Commission) is technology. Total considering issuance of amendments to Proposed Project: Graduate students No. of Depart- Burden Facility Operating License Nos. DPR–70 in science, engineering, and health institu- ments hours and DPR–75 issued to Public Service tions fields in U.S. colleges and universities, Electric and Gas Company (the licensee) by source and mechanism of support FY 1992 ...... 727 10,981 1.76 for operation of the Salem Nuclear and by demographic characteristics—A FY 1993 ...... 725 11,134 1.80 Generating Station, Units 1 and 2, mail survey, the Survey of Graduate FY 1994 ...... 724 11,411 1.97 located in Salem County, New Jersey. Students and Postdoctorates in Science The proposed amendment would and Engineering originated in 1966 and revise Technical Specification (TS) has been conducted annually since Send comments to Herman Fleming, 3.3.2.1, ‘‘Engineered Safety Feature 1972. The survey is the academic Clearance Officer, National Science Actuation System Instrumentation’’ to graduate enrollment component of the Foundation, 4201 Wilson Boulevard, reflect a revised setpoint for the NSF statistical program that seeks to Suite 485, Arlington, VA 22230. Written interlock designated P–12. ‘‘provide a central clearinghouse for the comments should be received by Before issuance of the proposed collection, interpretation, and analysis September 17, 1996. license amendment, the Commission of data on the availability of, and the Dated: June 17, 1996. will have made findings required by the current and projected need for, Atomic Energy Act of 1954, as amended scientific and technical resources in the Herman G. Fleming, (the Act) and the Commission’s United States, and to provide a source NSF Clearance Officer. regulations. of information for policy formulation by [FR Doc. 96–18560 Filed 7–22–96; 8:45 am] The Commission has made a other agencies of the Federal BILLING CODE 7555±01±M proposed determination that the government’’ as mandated in the amendment request involves no National Science Foundation Act of significant hazards consideration. Under 1950. The proposed project will the Commission’s regulations in 10 CFR continue the current survey cycle for NATIONAL TRANSPORTATION 50.92, this means that operation of the three to five years. The annual Fall SAFETY BOARD facility in accordance with the proposed surveys for 1996 through 2000 will amendment would not (1) Involve a survey the universe of approximately Sunshine Act Meeting significant increase in the probability or 725 institutions offering accredited consequences of an accident previously graduate programs in science, TIME AND DATE: 9:30 a.m., Tuesday, July evaluated; or (2) create the possibility of engineering, or health. The survey has 30, 1996. a new or different kind of accident from provided continuity of statistics on any accident previously evaluated; or PLACE: The Board Room, 5th Floor, 490 graduate school enrollment and support (3) involve a significant reduction in a L’Enfant Plaza, S.W., Washington, D.C. for graduate students in all science & margin of safety. As required by 10 CFR 20594. engineering (S&E) and health fields, 50.91(a), the licensee has provided its with separate date requested on STATUS: Open. analysis of the issue of no significant demographic characteristics (race/ hazards consideration, which is MATTERS TO BE CONSIDERED: ethnicity and gender by full-time and presented below: part-time enrollment status). Statistics 6579A Aviation Accident Report: 1. The proposed change does not involve from the survey are published in NSF’s Uncontained Engine Failure/Fire, a significant increase in the probability or annual publication series Academic ValuJet Airlines Flight 597, Douglas DC– consequences of an accident previously Science and Engineering Graduates, in 9–32, Atlanta, Georgia, June 8, 1995. evaluated. NSF publications Science and This change to the Technical NEWS MEDIA CONTACT: Engineering Indicators, Women, Telephone: (202) Specifications does not involve any physical Minorities, and Persons with Disabilities 382–0660. changes to the plant or any procedures changes. in Science and Engineering, and are FOR MORE INFORMATION CONTACT: Bea available electronically on the World There is no safety consequence to the Hardesty, (202) 382–6525. [safety injection] SI function being enabled at Wide Web. ° The survey will be mailed primarily Dated: July 19, 1996. 543 F. The Tavg no-load temperature is at 547 °F with increasing T for higher power Bea Hardesty, avg to the administrators at the Institutional operation. The allowable value of 545 °F as Research Offices. To minimize burden, Federal Register Liaison Officer. the upper limit assures the availability of the the NSF is exploring possibilities for [FR Doc. 96–18812 Filed 7–19–96; 1:52 pm] SI function, therefore, the protective function using an automatic survey questionnaire BILLING CODE 7533±01±P will perform within its analyzed range. On (ASQ) diskette, on which institutions increasing temperature, P–12 automatically 38230 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices enables SI in both High Streamline Flow Several different steamline break analyses the Commission take this action, it will coincident with Low-Low Tavg and High are performed to support operation of the publish in the Federal Register a notice Steamline Flow coincident with Low Salem units. Analyses are performed to of issuance and provide for opportunity Steamline Pressure. It also provides an determine the core response to postulated for a hearing after issuance. The arming signal to the Steam Dump System. steamline breaks and to calculate mass and Commission expects that the need to On decreasing temperature, P–12 permits energy releases both inside and outside manual block of SI in both High Steamline containment. take this action will occur very Flow coincident with Low-Low Tavg and In the current licensing basis core response infrequently. High Steamline Flow coincident with Low steamline break analysis, the High Steamline Written comments may be submitted Steamline Pressure. This permits blocking of Flow coincident with Low-Low Tavg or Low by mail to the Chief, Rules Review and the SI below the minimum temperature for Steamline Pressure protective functions are Directives Branch, Division of Freedom criticality during a controlled shutdown. not modeled. As such, a change to the SI of Information and Publications With a 2 °F allowable deviation from the permissive has no impact on the analysis. Services, Office of Administration, U.S. ° nominal setpoint, the setpoint of 543 F is Other SI signals generated from a postulated Nuclear Regulatory Commission, adequate to enable the operator to block SI. steamline break are credited in the analysis. Washington, DC 20555–0001, and Hardware design of the [engineered safety Interlock P–12 is independent of these should cite the publication date and feature actuation system] ESFAS provides credited SI signals. Therefore, this change that actuation of the SI block, enable, and has no impact on the safety analysis. page number of this Federal Register ESFAS protection system operations are all The licensing basis steamline break mass notice. Written comments may also be provided by the same bistables. The analyses and energy release safety analyses, inside and delivered to Room 6D22, Two White were performed supporting the design of the outside containment, for Salem Units 1 and Flint North, 11545 Rockville Pike, ESFAS system. 2 assumes the availability of the High Rockville, Maryland, from 7:30 a.m. to Revision of the P–12 setpoint to enable Steamline Flow coincident with Low-Low 4:15 p.m. Federal workdays. Copies of manual block of SI from 541 °F to 543 °F Tavg or Low Steamline Pressure for actuation written comments received may be does not impact the safety analyses. SI is of SI and steamline isolation. However, no examined at the NRC Public Document available at or above the T no-load value avg credit is taken for these trip functions. The Room, the Gelman Building, 2120 L of 547 °F, which is consistent with the noted Technical Specification change is setpoint for Low-Low T in TS Table 3.3– Street, NW., Washington, DC. avg resolving a discrepancy between the The filing of requests for hearing and 4. Retaining the allowable value of 541 °F is permissive P–12 setpoint and the Low-Low petitions for leave to intervene is also consistent with Table 3.3–4. The Tavg setpoint. Even though this Low-Low Tavg proposed revisions do not affect the integrity function is available in the steamline break discussed below. of the fuel assembly or reactor internals such mass and energy release analyses, operation By August 22, 1996 the licensee may that their function in the control of is not credited in the analyses. file a request for a hearing with respect radiological consequences is affected. In There are no new safety analyses or to issuance of the amendment to the addition, the proposed revisions do not affect revision[s] to any existing safety analyses as subject facility operating license and any fission product barrier. The proposed a result of these changes. In addition, the any person whose interest may be revision does not change, degrade, or prevent proposed change does not impact any input affected by this proceeding and who the response of safety related mitigation assumptions or results of any current wishes to participate as a party in the systems to accident scenarios, as described in licensing basis analyses for the design basis the [Final Safety Analysis Report] FSAR. proceeding must file a written request events. Therefore, there is no significant for a hearing and a petition for leave to Therefore the proposed change does not reduction in the margin of safety. involve a significant increase in the intervene. Requests for a hearing and a probability or consequences of an accident The NRC staff has reviewed the petition for leave to intervene shall be previously evaluated. licensee’s analysis and, based on this filed in accordance with the 2. The proposed change does not create the review, it appears that the three Commission’s ‘‘Rules of Practice for possibility of a new or different kind of standards of 10 CFR 50.92(c) are Domestic Licensing Proceedings’’ in 10 accident from any accident previously satisfied. Therefore, the NRC staff CFR Part 2. Interested persons should evaluated. proposes to determine that the consult a current copy of 10 CFR 2.714 The proposed changes to the TS setpoints amendment request involves no which is available at the Commission’s for P–12 do not create failure modes that significant hazards consideration. could adversely impact safety-related Public Document Room, the Gelman equipment or cause the initiation of any The Commission is seeking public Building, 2120 L Street, NW., accident. The P–12 interlock circuit pertains comments on this proposed Washington, DC, and at the local public to accident mitigation systems and not determination. Any comments received document room located at the Salem accident initiation. Functions of safety within 30 days after the date of Free Public Library, 112 West related systems and components, which are publication of this notice will be Broadway, Salem, New Jersey. If a related to accident mitigation, have not been considered in making any final request for a hearing or petition for altered. determination. leave to intervene is filed by the above The proposed TS setpoint change does not Normally, the Commission will not date, the Commission or an Atomic cause the initiation of any accident or create issue the amendment until the any new credible failure in the system. The Safety and Licensing Board, designated proposed revisions do not result in any expiration of the 30-day notice period. by the Commission or by the Chairman malfunction of equipment previously However, should circumstances change of the Atomic Safety and Licensing evaluated. The proposed revisions do not during the notice period such that Board Panel, will rule on the request result in increased probability of equipment failure to act in a timely way would and/or petition; and the Secretary or the failure scenarios previously deemed result, for example, in derating or designated Atomic Safety and Licensing improbable. shutdown of the facility, the Board will issue a notice of hearing or Therefore, the proposed change does not Commission may issue the license an appropriate order. create the possibility of a new or different amendment before the expiration of the As required by 10 CFR 2.714, a kind of accident from any accident 30-day notice period, provided that its petition for leave to intervene shall set previously evaluated, the revisions will not create the possibility of a malfunction of final determination is that the forth with particularity the interest of equipment important to safety different than amendment involves no significant the petitioner in the proceeding, and previously evaluated in the FSAR. hazards consideration. The final how that interest may be affected by the 3. The proposed change does not involve determination will consider all public results of the proceeding. The petition a significant reduction in a margin of safety. and State comments received. Should should specifically explain the reasons Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38231 why intervention should be permitted significant hazards consideration. The Dated at Rockville, Maryland, this 17th day with particular reference to the final determination will serve to decide of July 1996. following factors: (1) The nature of the when the hearing is held. For the Nuclear Regulatory Commission. petitioner’s right under the Act to be If the final determination is that the Donald S. Brinkman, made party to the proceeding; (2) the amendment request involves no Senior Project Manager, Project Directorate nature and extent of the petitioner’s significant hazards consideration, the I–2, Division of Reactor Projects—I/II, Office property, financial, or other interest in Commission may issue the amendment of Nuclear Reactor Regulation. the proceeding; and (3) the possible and make it immediately effective, [FR Doc. 96–18665 Filed 7–22–96; 8:45 am] effect of any order which may be notwithstanding the request for a BILLING CODE 7590±01±P entered in the proceeding on the hearing. Any hearing held would take petitioner’s interest. The petition should place after issuance of the amendment. also identify the specific aspect(s) of the If the final determination is that the Sunshine Act Meeting subject matter of the proceeding as to amendment request involves a AGENCY HOLDING THE MEETING: Nuclear which petitioner wishes to intervene. significant hazards consideration, any Regulatory Commission. Any person who has filed a petition for hearing held would take place before leave to intervene or who has been DATES: Weeks of July 22, 29, August 5, the issuance of any amendment. and 12, 1995. admitted as a party may amend the A request for a hearing or a petition PLACE: Commissioners’ Conference petition without requesting leave of the for leave to intervene must be filed with Room, 11555 Rockville Pike, Rockville, Board up to 15 days prior to the first the Secretary of the Commission, U.S. Maryland. prehearing conference scheduled in the Nuclear Regulatory Commission, proceeding, but such an amended Washington, DC 20555–0001, Attention: STATUS: Public and Closed. petition must satisfy the specificity Docketing and Services Branch, or may MATTERS TO BE CONSIDERED: requirements described above. be delivered to the Commission’s Public Week of July 22 Not later than 15 days prior to the first Document Room, the Gelman Building, prehearing conference scheduled in the 2120 L Street, NW., Washington, DC, by There are no meetings scheduled for the proceeding, a petitioner shall file a the above date. Where petitions are filed Week of July 22. supplement to the petition to intervene during the last 10 days of the notice Week of July 29—Tentative which must include a list of the period, it is requested that the petitioner contentions which are sought to be Monday, July 29 promptly so inform the Commission by litigated in the matter. Each contention a toll-free telephone call to Western 10:00 a.m.—Briefing on Uranium Recovery must consist of a specific statement of Program (Public Meeting) (Contact: Joe Union at 1–(800) 248–5100 (in Missouri the issue of law or fact to be raised or Holonich, 301–415–6643) 1–(800) 342–6700). The Western Union controverted. In addition, the petitioner operator should be given Datagram Tuesday, July 30 shall provide a brief explanation of the Identification Number N1023 and the 10:00 a.m.—Briefing by Nuclear Waste bases of the contention and a concise following message addressed to John F. Technical Review Board (Public statement of the alleged facts or expert Stolz: petitioner’s name and telephone Meeting) opinion which support the contention 11:30 a.m.—Affirmation Session (Public and on which the petitioner intends to number, date petition was mailed, plant name, and publication date and page Meeting) (if needed) rely in proving the contention at the 2:00 p.m.—Briefing on Status of Staff Actions hearing. The petitioner must also number of this Federal Register notice. on Industry Restructuring and provide references to those specific A copy of the petition should also be Deregulation (Public Meeting) (Contact: sources and documents of which the sent to the Office of the General Dave Mathews, 301–415–1282) petitioner is aware and on which the Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555– Wednesday, July 31 petitioner intends to rely to establish 2:00 p.m.—Briefing on EEO Program (Public those facts or expert opinion. Petitioner 0001, and to Mark J. Wetterhahn, Esquire, Winston and Strawn, 1400 L Meeting) (Contact: Ed Tucker, 301–415– must provide sufficient information to 7382) show that a genuine dispute exists with Street, NW., Washington, DC 20005– the applicant on a material issue of law 3502, attorney for the licensee. Thursday, August 1 or fact. Contentions shall be limited to Nontimely filings of petitions for 3:00 p.m.—Briefing on Spent Fuel Pool matters within the scope of the leave to intervene, amended petitions, Cooling Issues (Public Meeting) (Contact: amendment under consideration. The supplemental petitions and/or requests George Hubbard, 301–415–2870) contention must be one which, if for hearing will not be entertained Week of August 5—Tentative proven, would entitle the petitioner to absent a determination by the Commission, the presiding officer or the There are no meetings scheduled for the relief. A petitioner who fails to file such Week of August 5. a supplement which satisfies these presiding Atomic Safety and Licensing requirements with respect to at least one Board that the petition and/or request Week of August 12—Tentative contention will not be permitted to should be granted based upon a There are no meetings scheduled for the participate as a party. balancing of the factors specified in 10 Week of August 12. Those permitted to intervene become CFR 2.714(a)(1) (i)–(v) and 2.714(d). The schedule for Commission meetings is parties to the proceeding, subject to any For further details with respect to this subject to change on short notice. To verify action, see the application for the status of meetings call (Recording)—(301) limitations in the order granting leave to 415–1292. Contact person for more intervene, and have the opportunity to amendment dated July 12, 1996, which information: Bill Hill (301) 415–1661. participate fully in the conduct of the is available for public inspection at the Commission’s Public Document Room, * * * * * hearing, including the opportunity to The NRC Commission Meeting Schedule present evidence and cross-examine the Gelman Building, 2120 L Street can be found on the Internet at: http:// witnesses. NW., Washington, DC, and at the local www.nrc.gov/SECY/smj/schedule.htm. If a hearing is requested, the public document room located at the This notice is distributed by mail to several Commission will make a final Salem Free Public Library, 112 West hundred subscribers; if you no longer wish determination on the issue of no Broadway, Salem, New Jersey. to receive it, or would like to be added to it, 38232 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices please contact the Office of the Secretary, Secretary of the Board, Thomas J. SUPPLEMENTARY INFORMATION: The Attn: Operations Branch, Washington, D.C. Koerber, at (202) 268–4800. following is a summary of the 20555 (301–415–1963). Thomas J. Koerber, application. The complete application In addition, distribution of this meeting Secretary. may be obtained for a fee at the SEC’s notice over the internet system is available. Public Reference Branch. If you are interested in receiving this [FR Doc. 96–18805 Filed 7–19–96; 1:42 pm] Commission meeting schedule electronically, BILLING CODE 7710±12±M Applicant’s Representations please send an electronic message to [email protected] or [email protected]. 1. Applicant is closed-end management investment company * * * * * SECURITIES AND EXCHANGE organized as a Massachusetts business Dated: July 17, 1996. COMMISSION trust. Applicant’s investment objective William M. Hill, Jr., [Rel. No. IC±22078; 812±10220] is to maintain an annual distribution Secretary Tracking Officer, Office of the rate of 11%, based on the original Secretary. MFS Special Value Trust; Notice of offering price of $15 per share, while [FR Doc. 96–18781 Filed 7–19–96; 11:10 am] Application seeking capital appreciation. BILLING CODE 7590±01±M 2. Applicant has a distribution policy July 17, 1996. calling for twelve monthly distributions AGENCY: Securities and Exchange to shareholders of an amount equal to Commission (‘‘SEC’’). 0.916% of its initial public offering UNITED STATES POSTAL SERVICE ACTION: Notice of application for price of $15 per share (11% on an exemption under the Investment annualized basis) (‘‘Monthly Board of Governors; Sunshine Act Company Act of 1940 (the ‘‘Act’’). Distribution Policy’’). If, for any Notice of Vote to Close Meeting monthly distribution, net investment  APPLICANT: MFS Special Value Trust. income and net realized short-term By telephone vote on July 18, 1996, RELEVANT ACT SECTIONS: Exemption capital gains are less than the amount of the Board of Governors of the United requested under section 6(c) of the Act the distribution, the difference is States Postal Service voted unanimously that would grant an exemption from distributed from other assets. to close to public observation its section 19(b) of the Act and rule 19b– Applicant’s final distribution for each meeting scheduled for July 28–30, 1996, 1 thereunder. calendar year includes any remaining in Chicago, Illinois. The members will SUMMARY OF APPLICATION: Applicant net investment income and net realized consider strategic planning. requests an order to make up to twelve short-term capital gains deemed, for The meeting is expected to be monthly distributions of long-term federal income tax purposes, attended by the following persons: capital gains in any one taxable year, so undistributed during the year, as well as Governors Alvarado, Daniels, del Junco, long as applicant maintains in effect a any net long-term capital gains realized Dyhrkopp, Fineman, Mackie, distribution policy calling for monthly during the year. If, for any fiscal year, McWherter, Rider and Winters; distributions of a fixed percentage of its the total distributions exceed net Postmaster General Runyon, Deputy net asset value. investment income and net realized Postmaster General Coughlin, Secretary FILING DATES: The application was filed capital gains, the excess, distributed to the Board Koerber, and General on June 24, 1996. from other assets, is treated as a return Counsel Elcano. of capital. If applicant’s net investment HEARING OR NOTIFICATION OF HEARING: An income, net short-term realized gains, The Board determined that pursuant order granting the application will be net long-term realized gains, and returns to section 552b(c)(3) of title 5, United issued unless the SEC orders a hearing. of capital for any one year exceed the States Code; section 410(c) (2)–(5) of Interested persons may request a amount to be distributed under the title 39, United States Code; and section hearing by writing to the SEC’s Monthly Distribution Policy, applicant 7.3 (c) and (d) of title 39, Code of Secretary and serving applicants with a may in its discretion retain net long- Federal Regulations, the meeting is copy of the request, personally or by term capital gains to the extent of such exempt from the open meeting mail. Hearing requests should be excess. Applicant requests relief to requirement of the Government in the received by the SEC by 5:30 p.m. on permit it to make up to twelve Sunshine Act August 12, 1996, and should be distributions of net long-term capital [5 U.S.C. 552b(b)]. accompanied by proof of service on gains in any one taxable year, so long as The Board further determined that the applicants, in the form of an affidavit or, it maintains in effect the Monthly public interest does not require that the for lawyers, a certificate of service. Distribution Policy. Board’s discussion of these matters be Hearing requests should state the nature open to the public. of the writer’s interest, the reason for the Applicant’s Legal Analysis In accordance with section 552b(f)(1) request, and the issues contested. 1. Section 19(b) provides that of title 5, United States Code, and Persons may request notification of a registered investment companies may section 7.6(a) of title 39, Code of Federal hearing by writing to the SEC’s not, in contravention of such rules, Regulations, the General Counsel of the Secretary. regulations, or orders as the SEC may United States Postal Service has ADDRESSES: Secretary, SEC, 450 5th prescribe, distribute long-term capital certified that in her opinion the meeting Street N.W., Washington, D.C. 20549. gains more often than once every twelve may properly be closed to public Applicant, 500 Boylston Street, Boston, months. Rule 19b–1 limits the number observation pursuant to section MA 02116. of capital gains distributions, as defined 552b(c)(3) of title 5, United States Code; FOR FURTHER INFORMATION CONTACT: in section 852(b)(3)(C) of the Internal section 410(c) (2)–(5) of title 39, United Elaine M. Boggs, Staff Attorney, at (202) Revenue Code of 1986, as amended, (the States Code; and section 7.3 (c) and (d) 942–0572, or Alison E. Baur, Branch ‘‘Code’’), that applicant may make with of title 39, Code of Federal Regulations. Chief, at (202) 942–0564 (Division of respect to any one taxable year to one, Request for information about the Investment Management, Office of plus a supplemental distribution made meeting should be addressed to the Investment Company Regulation). pursuant to section 855 of the Code not Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38233 exceeding 10% of the total amount applicant’s annual report to For the Commission, by the Division of distributed for year, plus one additional shareholders. Through these disclosures Investment Management, pursuant to long-term capital gains distribution and other communications with delegated authority. made to avoid the excise tax under shareholders, applicant states that its Margaret H. McFarland, section 4982 of the Code. shareholders will understand that Deputy Secretary. 2. Rule 19b–1, by limiting the number applicant’s fixed distributions are not [FR Doc. 96–18561 Filed 7–22–96; 8:45 am] of net long-term capital gain tied to its investment income and BILLING CODE 8010±01M distributions that applicant may make realized capital gains and will not with respect to any one year, prevents represent yield or investment return. the normal operation of the Monthly Sunshine Act Agency Meetings Distribution Policy whenever applicants 5. Another concern that led to the Notice is hereby given, pursuant to realized net long-term capital gains in adoption of section 19(b) and rule 19b– the provisions of the Government in the any year exceed the total of the fixed 1 was that frequent capital gains Sunshine Act, Pub. L. 94–409, that the monthly distributions that under rule distributions could facilitate improper Securities and Exchange Commission 19b–1 may include such capital gains. fund distribution practices, including will hold the following meetings during In that situation, the rule effectively the practice of urging an investor to purchase fund shares on the basis of an the week of July 22, 1996. forces the fixed monthly distributions, Open meetings will be held on that under the rule may not include upcoming dividend (‘‘selling the dividend’’), where the dividend results Tuesday, July 23, 1996, at 10:00 a.m., such capital gains, to be funded with and Wednesday, July 24, 1996, at 10:00 in an immediate corresponding returns of capital (to the extent net a.m. Closed meetings will be held on reduction in net asset value and is in investment income and realized short- Tuesday, July 23, 1996, following the effect a return of the investor’s capital. term capital gains are insufficient), even 10:00 a.m. open meeting, and on though net realized long-term capital Applicant believes that this concern Thursday, July 25, 1996, at 10:00 a.m. gains would otherwise be available does not apply to closed-end investment Commissioners, Counsel to the therefor. The long-term capital gains in companies, such as applicant, which do Commissioners, the Secretary to the excess of the fixed monthly not continuously distribute shares. Commission, and recording secretaries distributions permitted by the rule then 6. Applicant states that another will attend the close meetings. Certain must either be added as an ‘‘extra’’ on concern leading to the adoption of staff members who have an interest in one of the permitted capital gains section 19(b) and rule 19b–1, the the matters may also be present. distributions, thus exceeding the total increased administrative costs The General Counsel of the annual amount called for by the associated with more frequent Commission, or his designee, has Monthly Distribution Policy, or be certified that, in his opinion, one or retained by applicant (with applicant distributions, is not present because applicant will continue to make more of the exemptions set forth in 5 paying taxes thereon). d U.S.C. 552b(c) (4), (8), (9)(A) and (10) 3. Applicant believes that granting the monthly distributions regardless of what and 17 CFR 200.402(a) (4), (8), (9)(i) and requested relief would limit applicant’s portion thereof is composed of capital (10), permit consideration of the return of capital distributions to that gains. scheduled matters at the closed meeting. amount necessary to make up any 7. Section 6(c) of the Act provides that Commission Johnson, as duty officer, shortfall between applicant’s guaranteed the SEC may exempt any person, voted to consider the items listed for the distribution and the total of its security, or transaction, or any class of closed meeting in a closed session. investment income and capital gains. classes of persons, securities, or The subject matter of the open The likelihood that applicant’s transactions, from any provisions of the meeting scheduled for Tuesday, July 23, shareholders would be subject to Act, if and to the extent such exemption 1996, at 10:00 a.m., will be: additional tax return complexities is necessary or appropriate in the public The Commission will hear oral argument involved when applicant retains and interest and consistent with the pays taxes on long-term capital gains on a appeal by Richard J. Puccio from the protection of investors and the purposes decision of an administrative law judge. For would therefore be avoided. fairly intended by the policy and further information, please contact William 4. One of the concerns leading to the provisions of the Act. For the reasons S. Stern at (202) 942–0949. adoption of section 19(b) and rule 19b– stated above, applicant believes that the The subject matter of the closed 1 was that shareholders might be unable requested exemption meets the to distinguish frequent distributions of meeting scheduled for Tuesday, July 23, standards set forth in section 6(c). capital gains from investment income. 1996, following the 10:00 a.m. open In accordance with rule 19a–1, a Applicant’s Condition meeting, will be: separate statement showing the source Post oral argument discussion. Applicant agrees that the order of the distribution (net investment The subject matter of the open granting the exemption shall terminate income, net realized capital gains, or meeting scheduled for Wednesday, July upon the effective date of a registration returns of capital) will accompany each 24, 1996, at 10:00 a.m., will be: distribution (or the confirmation of the statement under the Securities Act of reinvestment thereof under applicant’s 1933 for any future public offering by The Commission will be presented with applicant of shares of applicant other the Final Report of the Advisory Committee dividend reinvestment plan). In on the Capital Formation and Regulatory addition, a statement showing the than: (i) a non-transferable rights Processes, which recommends the amount and source of distributions offering to shareholders of applicant, implementation of a company registration received during the year will be provided that such offering does not concept. For further information, please included with applicant’s IRS Form include solicitation by brokers or the contact David Sirignano at (202) 942–2870; 1099–DIV reports sent to each payment of any commissions or Meridith Mitchell at (202) 942–0890; or Luise shareholder who received distributions underwriting fee; and (ii) an offering in Welby at (202) 942–2990. during the year (including shareholders connection with a merger, The subject matter of the closed who sold shares during the year). This consolidation, acquisition, or meeting scheduled for Thursday, July information will also be included in reorganization. 25, 1996, at 10:00 a.m., will be: 38234 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Instruction and settlement of Amendment No. 1 to its proposal on When more than one exchange selects administrative proceedings of an July 9, 1996.4 The Commission is a multiply-traded option for its enforcement nature. publishing this notice to solicit allotment, the Options Clearing Institution and settlement of injunctive comments on the proposed rule changes action. Corporation (‘‘OCC’’) will determine Formal order of investigation. from interested persons, and to grant which exchange will be deemed to have accelerated approval of the proposed selected the option according to the At times, changes in Commission rule changes. priorities require alterations in the procedures agreed upon by the scheduling of meeting items. For further I. Self-Regulatory Organizations’ Exchanges. They have agreed that an information and to ascertain what, if Statement of the Terms of Substance of exchange (‘‘Selecting Exchange’’) 1 any, matters have been added, deleted the Proposed Rule Changes intending to list 2 ⁄2 point strikes on an option will inform OCC of its selection or postponed, please contact: The Office The Exchanges propose to extend for by submitting a notice (‘‘Selection of the Secretary at (202) 942–7070. one-year (i.e., July 18, 1997) the Notice’’) to OCC between the hours of Dated: July 19, 1996. Exchanges’ pilot program whereby the 8:30 a.m. and 12:00 Noon (Central Jonathan G. Katz, Exchanges may select a certain number of their listed options for inclusion in a Time). In the event that more than one Secretary. exchange submits a Selection Notice to [FR Doc. 96–18800 Filed 7–19–96; 1:42 pm] pilot program for the listing of strike prices at 21⁄2 point intervals. The text of the OCC for the same multiple-traded BILLING CODE 8010±01±M the proposed rule changes is available at option, the exchange which first the Office of the Secretary, the submits a Section Notice to the OCC [Release No. 34±37441; File Nos. SR±Amex± Exchanges, and at the Commission. will be deemed to be the Selecting 96±24; SR±CBOE±96±41; SR±NYSE±96±19; Exchange for that option. Such option SR±PSE±96±18; and SR±Phlx±96±22] II. Self-Regulatory Organizations’ will count toward the allotment of the Statement of the Purpose of, and Selecting Exchange, but not toward the Self-Regulatory Organizations; Notice Statutory Basis for, the Proposed Rule allotment of any other exchange of Filing and Order Granting Changes Accelerated Approval of Proposed submitting a Selection Notice under the In their filings with the Commission, terms of the pilot program. Rule Changes by the American Stock the Exchanges included statements Each of the Exchanges has also Exchange, Inc., Chicago Board concerning the purpose of and basis for Options Exchange, Inc., New York the proposed rule changes. The text of submitted a report to the Commission Stock Exchange, Inc., Philadelphia these statements may be examined at that includes data and written analysis Stock Exchange, Inc., and Pacific the places specified in Item IV below. regarding the operation of the pilot Stock Exchange, Inc., Relating to an program during the previous year, as 1 The Exchanges have prepared Extension of the 2 ¤2 Point Strike Price summaries, set forth in Sections (A), (B), required in the 21⁄2 Strike Price Pilot Program and (C) below, of the most significant Approval Order.7 The Exchanges generally believe that the pilot program July 15, 1996. aspects of such statements. has provided customers greater Pursuant to Section 19(b)(1) of the (A) Self-Regulatory Organizations’ Securities Exchange Act of 1934 opportunities and flexibility to tailor Statement of the Purpose of, and their options positions, while enhancing (‘‘Act’’),1 and Rule 19b–4 thereunder,2 Statutory Basis for, the Proposed Rule the depth and liquidity of the markets notice is hereby given that on June 3, Changes 1996, the Philadelphia Stock Exchange, in the selected options classes. Inc. (‘‘Phlx’’); on June 11, 1996, the The Commission has previously Each exchange has stated that it approved a pilot program proposed by Pacific Stock Exchange, Inc. (‘‘PSE’’); on believe its respective proposed rule the Exchanges to list selected options June 28, 1996, the Chicago Board change is consistent with Section 6(b) of Options Exchange, Inc. (‘‘CBOE’’); on trading at a strike price greater than $25 1 the Act in general and furthers the July 3, 1996, the American Stock but less than $50 at 2 ⁄2 point intervals 1 1 1 1 1 5 objectives of Section 6(b)(5) in Exchange, Inc. (‘‘Amex’’); and on July (i.e., 27 ⁄2, 32 ⁄2, 37 ⁄2, 42 ⁄2 and 47 ⁄2). Pursuant to the pilot program, the particular in that the joint proposal is 12, 1996, the New York Stock Exchange, designed to prevent fraudulent and Exchanges are permitted to use such 21⁄2 Inc. (‘‘NYSE’’) (collectively the manipulative acts and practices, to ‘‘Exchanges’’) filed with the Securities point strike price intervals for a joint total of up to 100 option issues. Each promote just and equitable principles of and Exchange Commission trade, and is not designed to permit (‘‘Commission’’) the proposed rule exchange may select 10 options plus a unfair discrimination between changes as described in Items I and II percentage of the remaining 50 options customers, issuers, brokers or dealers. below, which Items have been prepared equal to that exchange’s pro rata share by the Exchanges. The PSE submitted to of the total number of equity options (B) Self-Regulatory Organizations’ listed by the Exchanges.6 the Commission Amendment No. 1 to Statement on Burden on Competition its proposal on July 2, 1996.3 The Phlx 4 In Amendment No. 1, the Phlx indicated that the The Exchanges believe that the submitted to the Commission pilot period extension will expire on July 18, 1997. See Letter from Edith Hallahan, Special Counsel, proposed rule changes will impose no 1 15 U.S.C. 78s(b)(1). Regulatory Services, Phlx, to John Ayanian, burden on competition. 2 17 CFR 240.19b–4. Attorney, OMS, Market Regulation, Commission, 3 In Amendment No. 1, PSE withdraws its request dated July 9, 1996 (‘‘Phlx Amendment No. 1’’). for permanent approval of the pilot program, and 5 See Securities Exchange Act Release No. 35993 requests a one-year extension of the pilot program, (July 19, 1995), 60 FR 38073 (July 25, 1995) (File so that it will continue through July 18, 1997. See Nos. SR–Phlx–08, SR–Amex–95–12, SR–PSE–95– 7 1 1 In the 2 ⁄2 Point Strike Price Approval Order, the Letter from Michael Pierson, Senior Attorney, PSE, 07, SR–CBOE–95–19, SR–NYSE–95–12) (‘‘2 ⁄2 Point to John Ayanian, Attorney, Office of Market Strike Price Approval Order’’). Commission required that each Exchange submit a Supervision (‘‘OMS’’), Division of Market 6 The actual allotment of option issues for each report before the Commission would review a Regulation (‘‘Market Regulation’’), Commission, exchange is: CBOE (28), Amex (22), Phlx (18), PSE, proposal to extend the pilot program beyond the Dated July 1, 1996 (‘‘PSE Amendment No. 1’’). PSE (18), and NYSE (14). initial twelve-month period. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38235

(C) Self-Regulatory Organizations’ the 21⁄2 point strike price intervals for V. Conclusion Statement on Comments on the the options selected by the reporting It is therefore ordered, pursuant to Proposed Rule Changes Received From exchange. Section 19(b)(2) of the Act,9 that the The Commission finds good cause for Members, Participants or Others pilot program proposed by the Exchange approving the proposed rule changes No written comments were solicited (File Nos. SR–Amex–96–24; SR–CBOE– and Phlx Amendment No. 1 and PSE or received with respect to the proposed 96–41; SR–NYSE–96–19; SR–PSE–96– Amendment No. 1 prior to the thirtieth rule changes. 18; and SR–Phlx–96–22) is approved day after the date of publication of through July 18, 1997, on an accelerated III. Commission’s Findings and Order notice of filing thereof in the Federal Register. As mentioned above, the basis. Granting Accelerated Approval For the Commission, by the Division of Exchanges submitted separate reports to The Commission finds that the Market Regulation, pursaunt to delegated the Commission that include data and 10 proposed rule changes are consistent authority. written analysis regarding the operation with the requirements of the Act and the Margaret H. McFarland, of the pilot program as required in the rules and regulations thereunder Deputy Secretary. 21⁄2 Strike Price Approval Order. The applicable to a national securities Commission notes that the Exchanges [FR Doc. 96–18563 Filed 7–22–96; 8:45 am] exchange, and, in particular, the have not reported any significant BILLING CODE 8010±01±M requirements of Section 6(b)(5) of the 8 problems with the pilot program since Act. Specifically, the Commission its inception and that the Exchanges believes that the proposed extension of will continue to monitor the pilot SOCIAL SECURITY ADMINISTRATION the pilot program providing for the 1 program to ensure that no problems listing of 2 ⁄2 point strike price intervals arise. Finally, no adverse comments Representative Payment Advisory in selected equity options will continue have been received by the Exchanges or Committee; Meeting to provide investors with more the Commission concerning the pilot flexibility in the trading of equity AGENCY: Social Security Administration program. Based on the above, the (SSA). options with a strike price greater than Commission believes good cause exists ACTION: $25 but less than $50, thereby furthering to approve the extension of the pilot Notice. the public interest by allowing investors program through July 18, 1997, on an to establish equity options positions that DATES: September 25–26, 1996, 8:30 accelerated basis. Accordingly, the a.m.–4:30 p.m. are better tailored to meet their Commission believes that granting ADDRESSES: Social Security investment objectives. The Commission accelerated approval of the proposals is Administration Headquarters, Altmeyer also believes that the Exchanges’ appropriate and consistent with Multi-Purpose Auditorium, 6401 proposal strikes a reasonable balance Sections 6(b)(5) and 19(b)(2) of the Act. between the Exchanges’ desire to Security Blvd., Baltimore, MD 21235. accommodate market participants by IV. Solicitation of Comments SUPPLEMENTARY INFORMATION: Type of offering a wide array of investment Interested persons are invited to meeting: The meeting is open to the opportunities and the need to avoid submit written data, views and public. excessive proliferation of options series. arguments concerning the foregoing. Purpose: In accordance with section The Commission expects the Exchanges Persons making written submissions 10(a)(2) of the Federal Advisory to continue to monitor the applicable should file six copies thereof with the Committee Act, the Social Security equity options activity closely to detect Secretary, Securities and Exchange Administration (SSA) announces the any proliferation of illiquid options Commission, 450 Fifth Street, N.W., seventh meeting of the Representative series resulting from the narrower strike Washington, D.C. 20549. Copies of the Payment Advisory Committee. The price intervals and to act promptly to submission, all subsequent Committee will discuss the following remedy this situation should it occur. amendments, all written statements broad categories of representative In the event the Exchanges propose to with respect to the proposed rule payment policy: (1) beneficiary (in) (1) extend the pilot program beyond the change that are filed with the capability; (2) payee selection; (3) payee twelve month period, (2) expand the Commission, and all written recruitment and retention; (4) standards pilot program beyond the initial 100 communications relating to the for payee performance; and (5) payee option classes, or (3) seek permanent proposed rule change between the oversight. approval of the pilot program, they Commission and any person, other than This is a deliberative meeting at should submit a report to the those that may be withheld from the which no public testimony will be Commission with such proposal. The public in accordance with the heard. However, interested parties are report should cover the period from provisions of 5 U.S.C. 552, will be invited to attend the meeting or submit May 20, 1996 to one expiration month available for inspection and copying in written comments to the Office of the prior to the filing of the proposal, and the Commission’s Public Reference Committee at the address below. should include data and written Section, 450 Fifth Street, N.W., Agenda: The Committee will meet analysis on the open interst and trading Washington, D.C. 20549. Copies of such commencing at 8:30 a.m. to 4:30 p.m. on volume in affected series, and delisted filing will also be available for Wednesday and Thursday, September options series (for all strike price inspection and copying at the principal 25–26, 1996. Discussion items will intervals) on the selected pilot program office of the Exchanges. All submissions include a discussion of beneficiary (in) option classes. The report should also should refer to File Nos. SR–Amex–96– capability; payee selection; payee discuss any capacity problems that may 24; SR–CBOE–96–41; SR–NYSE–96–19; recruitment and retention; standards for have arisen during the pilot program SR–PSE–96–18; and SR–Phlx–96–22 payee performance; and payee and any other data relevant to the and should be submitted by August 13, oversight. The Committee will use this analysis of the pilot program, including 1996 the date of this publication. time to address the public comments on an assessment of the appropriateness of 9 15 U.S.C. 78s(b)(2). 8 15 U.S.C. 78f(b)(5). 10 17 CFR 200.30–3(a)(12). 38236 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices these issues which were received in On June 25, 1996 the Governments of Commonwealth of Puerto Rico) for connection with previously announced the United States and the Republic of consumption and withdrawal from meetings. Honduras signed an agreement to warehouse for consumption of cotton, wool Persons interested in attending this establish a new export visa arrangement and man-made fiber textile products in Categories 352, 652 and 435, including meeting should call the Representative and certification requirements for merged and part categories, produced or Payment Advisory Committee at (410) certain cotton, wool and man-made fiber manufactured in Honduras and exported 966–4688 so that arrangements for textile products, produced or from Honduras on and after July 15, 1996 for entrance into the meeting can be made. manufactured in Honduras and which the Government of the Republic of Individuals not making advance exported from Honduras on and after Honduras has not issued an appropriate arrangements should report to the main August 1, 1996. export visa fully described below. Should lobby. Arrangements for entrance can be In the letter published below, the additional categories, merged categories or made at that time. Chairman of CITA directs the part categories become subject to import quota the entire category(s) or part category(s) Records are being kept of all Commissioner of Customs to prohibit shall be included in the coverage of this Committee proceedings, and are entry of certain textile products, arrangement. Merchandise exported on or available for public inspection by produced or manufactured in Honduras after a mutually agreed date shall require a appointment at the office of the and exported from Honduras for which visa specifying the new designation. Representative Payment Advisory the Government of the Republic of A visa must accompany each commercial Committee, Room 2–N–24, Operations Honduras has not issued an appropriate shipment of the aforementioned textile Building, 6401 Security Boulevard, export visa or certificate. products. A circular stamped marking in blue Baltimore, MD 21235 between the hours Facsimiles of export visa and ink will appear on the front of the original certification stamps are on file at the commercial invoice or successor document. of 9:00 a.m. and 4:00 p.m. on regular The original visa shall not be stamped on business days. Anyone requiring U.S. Department of Commerce in Room duplicate copies of the invoice. The original information regarding the Committee 3100. invoice with the original visa stamp will be should contact the Representative A description of the textile and required to enter the shipment into the Payment Advisory Committee at P.O. apparel categories in terms of HTS United States. Duplicates of the invoice and/ Box 17763, Baltimore, MD 21203–7763; numbers is available in the or visa may not be used for this purpose. Telephone: (410) 966–4688; FAX (410) CORRELATION: Textile and Apparel Each visa stamp shall include the 966–0980; Internet: [email protected]. Categories with the Harmonized Tariff following information: 1. The visa number. The visa number shall Dated: July 15, 1996. Schedule of the United States (see Federal Register notice 60 FR 65299, be in the standard nine digit letter format, Reba Andrew, beginning with one numeric digit for the last published on December 19, 1995). digit of the year of export, followed by the Staff Director, Representative Payment Requirements for participation in the Advisory Committee. two character alpha country code specified Special Access Program are available in by the International Organization for [FR Doc. 96–18483 Filed 7–22–96; 8:45 am] Federal Register notices 51 FR 21208, Standardization (ISO) (the code for Honduras BILLING CODE 4190±29±P published on June 11, 1986; 52 FR is ‘‘HN’’). These first two codes shall be 26057, published on July 10, 1987; and followed by the number ‘‘1’’ and a five-digit 54 FR 50425, published on December 6, serial number identifying the shipment, e.g., 6HN112345. COMMITTEE FOR THE 1989. Also see 41 FR 30707, published on July 26, 1976. 2. The date of issuance. The date of IMPLEMENTATION OF TEXTILE issuance shall be the day, month and year on Interested persons are advised to take AGREEMENTS which the visa was issued. all necessary steps to ensure that textile 3. The original signature of the issuing Establishment of a New Export Visa products that are entered into the official of the Government of the Republic of Arrangement and Certification United States for consumption, or Honduras. Requirements for Certain Cotton, Wool withdrawn from warehouse for 4. The correct category(s), merged and Man-Made Fiber Textile Products consumption, will meet the visa and category(s), part category(s), quantity(s) and Produced or Manufactured in certification requirements set forth in unit(s) of quantity in the shipment as set forth in the U.S. Department of Commerce Honduras the letter published below to the Commissioner of Customs. Correlation or successor document and in the July 18, 1996. Harmonized Tariff Schedule of the United Troy H. Cribb, States Annotated (HTSUSA or successor AGENCY: Committee for the Chairman, Committee for the Implementation documents) shall be reported in the spaces Implementation of Textile Agreements of Textile Agreements. provided within the visa stamp (e.g., ‘‘Cat. (CITA). Committee for the Implementation of Textile 35209510 DZ’’). ACTION: Issuing a directive to the Agreements Quantities must be stated in whole Commissioner of Customs establishing numbers. Decimals or fractions will not be July 18, 1996. accepted. Merged category quota new export visa and certification Commissioner of Customs, requirements. merchandise may be accompanied by either Department of the Treasury, Washington, DC the appropriate merged category visa or the 20229. correct category visa corresponding to the EFFECTIVE DATE: August 1, 1996. Dear Commissioner: Under the terms of actual shipment (e.g., Categories 352/652 FOR FURTHER INFORMATION CONTACT: section 204 of the Agricultural Act of 1956, may be visaed as 352/652 or if the shipment Jennifer Aldrich, International Trade as amended (7 U.S.C. 1854); pursuant to the consists solely of 352 merchandise, the Specialist, Office of Textiles and Export Visa Arrangement dated June 25, 1996 shipment may be visaed as ‘‘Cat. 352,’’ but Apparel, U.S. Department of Commerce, between the Governments of the United not as ‘‘Cat. 652’’). (202) 482094212. States and the Republic of Honduras; and in U.S. Customs shall not permit entry if the accordance with the provisions of Executive shipment does not have a visa, or if the visa SUPPLEMENTARY INFORMATION: Order 11651 of March 3, 1972, as amended, number, date of issuance, signature, category, Authority: Executive Order 11651 of March you are directed to prohibit, effective on quantity or units of quantity are missing, 3, 1972, as amended; section 204 of the August 1, 1996, entry into the Customs incorrect or illegible, or have been crossed Agricultural Act of 1956, as amended (7 territory of the United States (i.e., the 50 out or altered in any way. If the quantity U.S.C. 1854). states, the District of Columbia and the indicated on the visa is less than that of the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38237 shipment, entry shall not be permitted. If the 3. The original signature of the issuing Merchandise imported for the personal use quantity indicated on the visa is more than official of the Government of the Republic of of the importer and not for resale, regardless that of the shipment, entry shall be permitted Honduras. of value, and properly marked or mutilated and only the amount entered shall be charged 4. The correct category(s), merged commercial sample shipments valued at to any applicable quota. category(s), part category(s), quantity(s), and U.S.$250 or less, do not require a visa or The complete name and address of the unit(s) of quantity in the shipment in the certification for entry and shall not be actual manufacturer of the textile product unit(s) of quantity provided for in the U.S. charged to existing quota levels. must be included on the visa document. If a Department of Commerce Correlation and in Visaed merchandise and products eligible textile product has been processed by more the Harmonized Tariff Schedule of the for the Caribbean Basin Special Access than one manufacturer, the complete name United States Annotated (HTSUSA or Textile Program may not appear on the same and address of the last firm to assemble the successor documents) shall be reported in the invoice. article must be listed on the visa document. spaces provided within the visa stamp (e.g., The visa and certification stamps are If the visa is not acceptable then a new visa ‘‘Cat. 352-510 DZ’’). enclosed. must be obtained from the Government of the Quantities must be stated in whole The actions taken concerning the Government of the Republic of Honduras Republic of Honduras, or a visa waiver may numbers. Decimals or fractions will not be with respect to imports of textiles and textile be issued by the U.S. Department of accepted. Merged category quota products in the foregoing categories have Commerce at the request of the Embassy of merchandise may be accompanied by either the appropriate merged category visa or the been determined by the Committee for the Honduras in Washington, DC, and presented Implementation of Textile Agreements to to the U.S. Customs Service before any correct category visa corresponding to the actual shipment (e.g., Categories 352/652 involve foreign affairs functions of the United portion of the shipment will be released. The States. Therefore, these directions to the waiver, if used, only waives the requirement may be visaed as 352/652 or if the shipment consists solely of 352 merchandise, the Commissioner of Customs, which are to present a visa with the shipment. It does shipment may be visaed as ‘‘Cat. 352,’’ but necessary for the implementation of such not waive the quota requirement. not as ‘‘Cat. 652’’). actions, fall within the foreign affairs If the visaed invoice is deficient, the U.S. U.S. Customs shall not permit entry if the exception to the rulemaking provisions of 5 Customs Service will not return the original shipment does not have a certification U.S.C. 553(a)(1). This letter will be published document after entry, but will provide a number, date of issuance, signature, category, in the Federal Register. certified copy of that visaed invoice. quantity or units of quantity are missing, Sincerely, If import quotas are in force, U.S. Customs incorrect or illegible, or have been crossed Troy H. Cribb, Service shall charge only the actual quantity out or altered in any way. If the quantity Chairman, Committee for the Implementation in the shipment to the correct category limit. indicated on the certification is less than that of Textile Agreements. If a shipment from Honduras subject to this of the shipment, entry shall not be permitted. arrangement has been allowed entry into the If the quantity indicated on the certification ANNEX A commerce of the United States with either an is more than that of the shipment, entry shall incorrect category classification or be permitted and only the amount entered misstatement of the quantity, and redelivery shall be charged to any applicable quota. Part Categories is requested but cannot be made, U.S. Entry of textile products subject to the 35209K Only HTS numbers 6107.11.0010, Customs shall charge the shipment to the certification system outlined above into the 6107.11.0020, 6108.19.9010, correct category limit whether or not a customs territory of the United States will be 6108.21.0010, 6108.21.0020, replacement visa or visa waiver is provided. permitted only for those shipments 6108.91.0005, 6108.91.0015, Each shipment of textile products which accompanied by: 6108.91.0025, 6109.10.0005, has been assembled in Honduras wholly from 1. A valid certification by the Government 6109.10.0007, 6109.10.0009, components cut in the United States from of the Republic of Honduras. 6109.10.0037. U.S. formed fabric which are subject to the 2. A completed CBI Export Declaration 65209K Only HTS numbers 6107.12.0010, Caribbean Basin Textile Special Access (U.S. Department of Commerce Form 6107.12.0020, 6108.11.0010, Program as set out in the Arrangement shall ITA09370P or successor document) with a 6108.11.0020, 6108.22.9020, be so certified by the Government of the proper declaration by the Honduras 6108.22.9030, 6108.92.0005, Republic of Honduras. This certification shall assembler that the articles were subject to 6108.92.0015, 6108.92.0025, be presented to the U.S. Customs Service assembly in Honduras from parts described 6109.90.1047 and 6109.90.1075. before entry, or withdrawal from warehouse on that CBI Export Declaration; and Merged Categories for consumption, into the customs territory of 3. A proper importer’s declaration. 352/652 the United States (the 50 states and Puerto Any shipment which is not accompanied 35209K/65209K Rico). by a valid and correct certification in [FR Doc. 96–18668 Filed 7–22–96; 8:45 am] Each shipment shall be certified by the accordance with the foregoing provisions stamping of the original rectangular-shaped shall be denied entry by the Government of BILLING CODE 3510±DR±F stamped marking in blue ink on the front of the United States. If U.S. Customs determines the original commercial invoice. The original that the certification is invalid because of an copy of the invoice with the original error, and the remaining documentation Establishment of Import Restraint certification will be required in order to enter fulfills requirements for entry under the Limits and Guaranteed Access Levels the shipment into the United States. Caribbean Basin Textile Special Access for Certain Cotton, Wool and Man- Duplicate copies of the invoice and/or Program then a new certification from the Made Fiber Textile Products Produced certification may not be used. Government of the Republic of Honduras or Manufactured in Honduras Each certification shall include the must be obtained or a visa waiver issued by following information: the U.S. Department of Commerce at the July 18, 1996. 1. The certification number. The request of the Government of the Republic of AGENCY: Committee for the certification number shall be nine digits and Honduras must be obtained and presented to Implementation of Textile Agreements letters. It shall begin with one digit for the the U.S. Customs Service before any portion (CITA). last digit of the year of export followed by the of the shipment will be released. ACTION: Issuing a directive to the two character country code for Honduras, Any shipment found not to be in which is ‘‘HN.’’ These first two codes shall compliance with the provisions of the Commissioner of Customs establishing be followed by the number ‘‘2’’ and a five- Caribbean Basin Textiles Special Access import limits and guaranteed access digit serial number identifying the shipment, Program relating to trade in textile products levels. e.g., 6HN212345. wholly assembled of U.S. components cut 2. The date of issuance. The date of from U.S. formed fabrics, may be EFFECTIVE DATE: August 1, 1996. issuance shall be the day, month and year in permanently denied entry under this FOR FURTHER INFORMATION CONTACT: which the visa was issued. program. Jennifer Aldrich, International Trade 38238 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

Specialist, Office of Textiles and December 22, 1995, by the Chairman, Category Amount to charge Apparel, U.S. Department of Commerce, Committee for the Implementation of Textile (202) 482094212. For information on the Agreements, which directs you to count 352/652 ...... 394,091 dozen. quota status of these limits, refer to the imports for consumption of cotton, wool and 35209K/65209K ...... 2,233,183 dozen. man-made fiber textile products in Categories Quota Status Reports posted on the 352/652, 35209K/65209K and 435, produced bulletin boards of each Customs port or Additionally, pursuant to the Special or manufactured in Honduras and exported Access Program, as set forth in 51 FR 21208 call (202) 927095850. For information during the period January 1, 1996 through (June 11, 1986), 52 FR 26057 (July 10, 1987) on embargoes and quota re-openings, December 31, 1996. and 54 FR 50425 (December 6, 1989), call (202) 482093715. Under the terms of section 204 of the effective on August 1, 1996, guaranteed Agricultural Act of 1956, as amended (7 SUPPLEMENTARY INFORMATION: access levels are being established for U.S.C. 1854), the Uruguay Round Agreements properly certified textile products assembled Authority: Executive Order 11651 of March Act and the Uruguay Round Agreement on in Honduras from fabric formed and cut in 3, 1972, as amended; section 204 of the Textiles and Clothing (ATC); and in the United States in textile products in the Agricultural Act of 1956, as amended (7 accordance with the provisions of Executive following categories which are re-exported to U.S.C. 1854); Uruguay Round Agreements Order 11651 of March 3, 1972, as amended, the United States from Honduras during the Act. you are directed to prohibit, effective on period January 1, 1996 through December 31, A notice published in the Federal August 1, 1996, entry into the United States 1996 in the following amounts: Register on September 20, 1995 (60 FR for consumption and withdrawal from warehouse for consumption of cotton, wool 48692) announces that the Governments Category Guaranteed Access of the United States and Honduras and man-made fiber textile products in the Level following categories, produced or agreed, pursuant to the Uruguay Round manufactured in Honduras and exported 352/652 ...... 50,000,000 dozen. Agreements Act and the Uruguay Round during the period beginning on January 1, 435 ...... 35,000 dozen. Agreement on Textiles and Clothing 1996 and extending through December 31, (ATC), to establish limits and 1996, in excess of the following restraint You are directed to charge 7,881,821 dozen Guaranteed Access Levels (GALs) for limits: to the guaranteed access level established for Categories 352/652 and 435 for the Categories 352/652 and 2,970 dozen to the period January 1, 1996 through Category Twelve-month limit1A1 guaranteed access level established for December 31, 1996. Category 435 for the 1996 period. These 352/652 ...... 10,070,000 dozen of charges are for the goods imported during the In the letter published below, the period January 1, 1996 through June 30, 1996 Chairman of CITA directs the which not more than 7,420,000 dozen (Categories 352/652) and January 1, 1996 Commissioner of Customs to establish shall be in Cat- through April 30, 1996 (Category 435) subject the 1996 limits. These limits are based egories 35209K/ to the Special Access Program. on limits notified to the Textiles 65209K1A2. Any shipment for entry under the Special Monitoring Body pursuant to the 435 ...... 14,688 dozen. Access Program which is not accompanied Uruguay Round Agreements Act and the by a valid and correct certification and 1 Uruguay Round Agreement on Textiles 1AThe limits have not been adjusted to ac- Export Declaration in accordance with the count for any imports exported after December provisions of the certification requirements and Clothing (ATC). Also, guaranteed 31, 1995. established in the directive of July 18, 1996 access levels are being established for 21ACategory 35209K: only HTS numbers shall be denied entry unless the Government Categories 352/652 and 435 for 1996. 6107.11.0010, 6107.11.0020, 6108.19.9010, of the Republic of Honduras authorizes the A description of the textile and 6108.21.0010, 6108.21.0020, 6108.91.0005, entry and any charges to the appropriate 6108.91.0015, 6108.91.0025, 6109.10.0005, apparel categories in terms of HTS 6109.10.0007, 6109.10.0009, 6109.10.0037; specific limit. Any shipment which is numbers is available in the Category 65209K: 6107.12.0010, declared for entry under the Special Access CORRELATION: Textile and Apparel 6107.12.0020, 6108.11.0010, 6108.11.0020, Program but found not to qualify shall be Categories with the Harmonized Tariff 6108.22.9020, 6108.22.9030, 6108.92.0005, denied entry into the United States. 6108.92.0015, 6108.92.0025, 6109.90.1047 In carrying out the above directions, the Schedule of the United States (see and 6109.90.1075. Commissioner of Customs should construe Federal Register notice 60 FR 65299, entry into the United States for consumption published on December 19, 1995). Also Imports charged to these category limits for the periods March 27, 1995 through to include entry for consumption into the see 60 FR 67349, published on December 31, 1995 (Categories 352/652 and Commonwealth of Puerto Rico. December 29, 1995. 35209K/65209K) and April 24, 1995 through The Committee for the Implementation of The letter to the Commissioner of December 31, 1995 (Category 435) shall be Textile Agreements has determined that Customs and the actions taken pursuant charged against those levels of restraint to the these actions fall within the foreign affairs to it are not designed to implement all extent of any unfilled balances. In the event exception of the rulemaking provisions of 5 of the provisions of the Uruguay Round the limits established for those periods have U.S.C. 553(a)(1). Sincerely, Agreements Act and the Uruguay Round been exhausted by previous entries, such Agreement on Textiles and Clothing, but goods shall be subject to the levels set forth Troy H. Cribb, are designed to assist only in the in this directive. Chairman, Committee for the Implementation implementation of certain of their The limits set forth above are subject to of Textile Agreements adjustment in the future according to the provisions. [FR Doc.96–18669 Filed 7–22–96; 8:45 am] provisions of the Uruguay Round Agreements BILLING CODE 3510±DR±F Troy H. Cribb, Act, the ATC and any administrative Chairman, Committee for the Implementation arrangements notified to the Textiles of Textile Agreements. Monitoring Body. You are directed to charge the following OFFICE OF THE UNITED STATES Committee for the Implementation of Textile TRADE REPRESENTATIVE Agreements amounts to the limit established in this directive for Categories 352/652 and 435 for July 18, 1996. 1996. These charges are for goods imported WTO Dispute Settlement Proceeding Commissioner of Customs, during the period January 1, 1996 through Concerning Certain Canadian Department of the Treasury, Washington, DC June 30, 1996 (Categories 352/652) and Measures Affecting Periodicals 20229. January 1, 1996 through April 30, 1996 Dear Commissioner: This directive cancels (Category 435). Additional charges will be AGENCY: Office of the United States and supersedes the directive issued to you on supplied at a later date. Trade Representative. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38239

ACTION: Notice; request for comments. Tax Act, as enacted by Bill C–103 of 20508. The public file will include a December 15,1995, which imposed an listing of any comments made to USTR SUMMARY: Pursuant to section 127(b)(1) excise tax on certain so-called ‘‘split- from the public with respect to the of the Uruguay Round Agreements Act run’’ periodicals; and (3) application of proceeding; the U.S. submissions to the (URAA) (19 U.S.C. 3537(b)(1)), the favorable postal rates to certain panel in the proceeding; the Office of the United States Trade Canadian periodicals, including through submissions, or non-confidential Representative (USTR) is providing actions of the Canada Post Corporation summaries of submissions, to the panel notice that a dispute settlement panel and the Department of Canadian received from other participants in the convened under the Agreement Heritage (formerly the Department of dispute, as well as the report of the Establishing the World Trade Communications). dispute settlement panel and, if Organization (WTO) at the request of the These measures appear to prohibit or applicable, the report of the Appellate United States will examine Canadian restrict imports of periodicals from the Body. An appointment to review the measures affecting periodicals, United States and other Members of the public file (Docket [WTO/D–7, ‘‘U.S.- including an import ban on certain World Trade Organization in Canada: Periodicals’’), may be made by periodicals and discriminatory contravention of the Government of calling Brenda Webb, (202) 395–6186. treatment of certain imported Canada’s obligations under Article XI of The USTR Reading Room is open to the periodicals with respect to excise taxes the General Agreement on Tariffs and public from 10 a.m. to 12 noon and 1 and postal rates. USTR also invites Trade 1994, and also appear to be p.m. to 4 p.m., Monday through Friday. written comments from the public inconsistent with the national treatment Jennifer Hillman, concerning the issues raised in the obligations of the Government of General Counsel. dispute. Canada under Article III of the General [FR Doc. 96–18618 Filed 7–22–96; 8:45 am] DATES: Although USTR will accept any Agreement on Tariffs and Trade 1994. BILLING CODE 3910±01±M comments received during the course of These measures also appear to nullify the dispute settlement proceedings, or impair the benefits accruing to the comments should be submitted on or United States directly or indirectly DEPARTMENT OF TRANSPORTATION before August 15, 1996 in order to be under the General Agreement on Tariffs assured of timely consideration by and Trade 1994. Federal Aviation Administration USTR in preparing its first written Public Comment: Requirements for Noise Exposure Map Notice; Receipt of submission to the panel. Submissions ADDRESSES: Comments may be Noise Compatibility Program and submitted to Carolyn Frank, Executive Interested persons are invited to Request for Review, Tallahassee Secretary, Trade Policy Staff Committee, submit written comments concerning Regional Airport, Tallahassee, Florida the issues raised in the dispute. Room 501, Attn: Periodicals Dispute, AGENCY: Federal Aviation Office of the U.S. Trade Representative, Comments must be in English and provided in fifteen copies. A person Administration, DOT. 600 17th Street, N.W., Washington, DC ACTION: Notice. 20508. requesting that information contained in a comment submitted by that person be SUMMARY: The Federal Aviation FOR FURTHER INFORMATION CONTACT: treated as confidential business William Kane, Associate General Administration (FAA) announces its information must certify that such determination that the updated noise Counsel, Office of the General Counsel, information is business confidential and Office of the U.S. Trade Representative, exposure maps submitted by the City of would not customarily be released to Tallahassee, Florida for Tallahassee 600 17th Street, N.W., Washington, DC the public by the commenter. 20508, (202) 395–6800. Regional Airport under the provisions of Confidential business information must Title I of the Aviation Safety and Noise SUPPLEMENTARY INFORMATION: At the be clearly marked ‘‘BUSINESS United States’ request, a WTO dispute Abatement Act of 1979 (Pub. L. 96–193) CONFIDENTIAL’’ in a contrasting color and 14 CFR Part 150 are in compliance settlement panel will examine whether ink at the top of each page of each copy. certain Canadian measures concerning with applicable requirements. The FAA A person requesting that information also announces that it is reviewing a periodicals are consistent with Canada’s or advice contained in a comment obligations under the General proposed noise compatibility program submitted by that person, other than update that was submitted for Agreement on Tariffs and Trade (GATT) business confidential information, be 1994. Tallahassee Regional Airport under Part treated as confidential in accordance 150 in conjunction with the noise Members of the panel are currently with section 135(g)(2) of the Trade Act being selected, and the panel is exposure maps, and that this program of 1974 (19 U.S.C. 2155)— update will be approved or disapproved expected to meet as necessary at the (1) must so designate that information on or before December 22, 1996. WTO headquarters in Geneva, or advice; Switzerland to examine the dispute. (2) must clearly mark the material as EFFECTIVE DATE: The effective date of the Under normal circumstances, the panel ‘‘CONFIDENTIAL’’ in a contrasting FAA’s determination on the updated would be expected to issue a report color ink at the top of each page of each noise exposure maps and of the start of detailing its findings and copy; and its review of the associated noise recommendations in six to nine months. (3) is encouraged to provide a non- compatibility program update is June confidential summary of the 25, 1996. The public comment period Major Issues Raised by the United information or advice. ends August 24, 1996. States and Legal Basis of Complaint Pursuant to section 127(e) of the FOR FURTHER INFORMATION CONTACT: Mr. The Government of Canada maintains URAA, USTR will maintain a file on Tommy J. Pickering, P.E., Federal several measures concerning this dispute settlement proceeding, Aviation Administration, Orlando periodicals, including, but not limited accessible to the public, in the USTR Airports District Office, 9677 Tradeport to: (1) Tariff Code 9958, which prohibits Reading Room: Room 101, Office of the Drive, Suite 130, Orlando, Florida the importation into Canada of certain United States Trade Representative, 600 32827–5397, (407) 648–6583, Extension periodicals; (2) Part V.1 of the Excise 17th Street, N.W., Washington DC 29. Comments on the proposed noise 38240 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices compatibility program update should MAP A’’ and ‘‘FUTURE FIVE-YEAR CFR Part 150, Section 150.33. The also be submitted to the above office. DNL NOISE CONTOURS WITH primary considerations in the SUPPLEMENTARY INFORMATION: This MODIFICATIONS MAP B’’ in the evaluation process are whether the notice announces that the FAA finds submission. The FAA has determined proposed measures may reduce the level that the updated noise exposure maps that these maps for Tallahassee Regional of aviation safety, create an undue submitted for Tallahassee Regional Airport are in compliance with burden on interstate or foreign Airport are in compliance with applicable requirements. This commerce, or be reasonably consistent applicable requirements of Part 150, determination is effective on June 25, with obtaining the goal of reducing effective June 25, 1996. Further, FAA is 1996. FAA’s determination on an airport existing noncompatible land uses and reviewing a proposed noise operator’s noise exposure maps is preventing the introduction of compatibility program update for that limited to a finding that the maps were additional noncompatible land uses. airport which will be approved or developed in accordance with the Interested persons are invited to disapproved on or before December 22, procedures contained in Appendix A of comment on the proposed program 1996. This notice also announces the FAR Part 150. Such determination does update with specific reference to these availability of this program update for not constitute approval of the factors. All comments, other than those public review and comment. applicant’s data, information or plans, properly addressed to local land use Under Section 103 of Title I of the or a commitment to approve a noise authorities, will be considered by the Aviation Safety and Noise Abatement compatibility program or to fund the FAA to the extent practicable. Copies of Act of 1979 (hereinafter referred to as implementation of that program. the updated noise exposure maps, the If questions arise concerning the ‘‘the Act’’), an airport operator may FAA’s evaluation of the maps, and the precise relationship of specific submit to the FAA noise exposure maps proposed noise compatibility program properties to noise exposure contours which meet applicable regulations and update are available for examination at depicted on a noise exposure map which depict noncompatible land uses the following locations: submitted under Section 103 of the Act, as of the date of submission of such Federal Aviation Administration, it should be noted that the FAA is not maps, a description of projected aircraft Orlando Airports District Office, 9677 involved in any way in determining the operations, and the ways in which such Tradeport Drive, Suite 130, Orlando, relative locations of specific properties operations will affect such maps. The Florida 32827–5397 with regard to the depicted noise Act requires such maps to be developed Airport Director’s Office, Tallahassee contours, or in interpreting the noise Regional Airport, 1400 Lee Wagener in consultation with interested and exposure maps to resolve questions affected parties to the local community, Boulevard, Tallahassee, FL 32304 concerning, for example, which Questions may be directed to the government agencies, and persons using properties should be covered by the individual named above under the the airport. provisions of Section 107 of the Act. heading, FOR FURTHER INFORMATION An airport operator who has These functions are inseparable from CONTACT. submitted noise exposure maps that are the ultimate land use control and found by FAA to be in compliance with planning responsibilies of local Issued in Orlando, Florida on June 25, the requirements of Federal Aviation government. These local responsibilities 1996. Regulations (FAR) Part 150, are not changed in any way under Part Charles E. Blair, promulgated pursuant to Title I of the 150 or through FAA’s review of noise Manager, Orlando Airport District Office. Act, may submit a noise compatibility exposure maps. Therefore, the [FR Doc. 96–18689 Filed 7–22–96; 8:45am] program for FAA approval which sets responsibility for the detailed BILLING CODE 4910±13±M forth the measures the operator has overlaying of noise exposure contours taken or proposes for the reduction of onto the map depicting properties on existing noncompatible uses and for the the surface rests exclusively with the [Docket No. 28567] prevention of the introduction of airport operator which submitted those A Call for the Development of additional noncompatible uses. maps, or with those public agencies and The City of Tallahassee, Florida, Prototype(s) for a Global Analysis and planning agencies with which Information Network (GAIN) submitted to the FAA on June 4, 1996, consultation is required under Section updated noise exposure maps, 103 of the Act. The FAA has relied on AGENCY: Federal Aviation descriptions and other documentation the certification by the airport operator, Administration (FAA), DOT. which were produced during the under Section 150.21 of FAR Part 150, ACTION: Notice of On-line Question and Tallahassee Regional Airport FAR Part that the statutorily required consultation Answer Session About GAIN on 150 Program Update conducted between has been accomplished. CompuServe. January 3, 1994 and May 30, 1996. It The FAA has formally received the was requested that the FAA review this noise compatibility program update for SUMMARY: On May 10, 1996, the FAA material as the noise exposure maps, as Tallahassee Regional Airport, also published a request for comments about described in Section 103(a)(1) of the effective on June 25, 1996. Preliminary the Global Analysis and Information Act, and that the noise mitigation review of the submitted material Network (GAIN) concept and measures, to be implemented jointly by indicates that it conforms to the implementation strategy for collecting the airport and surrounding requirements for the submittal of noise and analyzing aviation safety data. That communities, be approved as a noise compatibility programs, but that further request for comments also invited compatibility program under Section review will be necessary prior to participation in the development of 104(b) of the Act. approval or disapproval of the program proof-of-concept prototypes. The GAIN The FAA has completed its review of update. The formal review period, concept involves the international the updated noise exposure maps and limited by law to a maximum of 180 sharing and analyzing of data, related descriptions submitted by the days, will be completed on or before technologies, and systems that would City of Tallahassee, Florida. The December 22, 1996. provide an early warning capability to specific maps under consideration are The FAA’s detailed evaluation will be signal increased risks in aviation safety. ‘‘CURRENT DNL NOISE CONTOURS conducted under the provisions of 14 The comment period closed on July 19, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38241

1996, and more than 60 comments were for about the last 10 years, and at typical accident investigation findings submitted from all over the world. today’s accident rate, the forecasted of earlier flights that experienced This notice announces an opportunity growth in air transportation demand problems similar to the accident aircraft. for commenters and others to discuss could lead to more than 4,500 fatalities A truly effective early warning issues and ask questions about GAIN worldwide per year by 2025—clearly an capability would involve significant with Christopher A. Hart, FAA’s unacceptable result. Yet, all too often, improvements in information feedback Assistant Administrator for System the aviation industry as a whole has not and analysis for aviation operations. Safety (ASY–1). Mr. Hart will serve as been able to use data about accidents, When fully implemented, it is believed the facilitator of a live on-line question incidents and other system anomalies to that GAIN would, at a minimum, add and answer session on the CompuServe become aware of existing or emerging the following new elements to the Information Service. In preparation for a safety problems in time to take existing monitoring systems: (1) new workshop to be convened by the FAA preventive measures. The entire data sources that would improve risk later this year to bring commenters and industry must develop a significantly assessment and provide a baseline for others together to discuss GAIN and the improved operational early warning normal flight operations, thus development of GAIN prototypes, capability that is sensitive enough to improving the changes of early anomaly commenters are encouraged to review detect and alert the aviation community detection; (2) new and innovative data each other’s comments and to to existing and emerging problems. A management and analytical techniques commence discussions with each other major aspect of this capability is the and methodologies that quickly reveal about potential joint ventures. By sharing of safety information, both obscure and/or infrequent data patterns clarifying issues that commenters and within categories in the industry, e.g., and associations; and (3) new methods others may have, this on-line question carriers must share with other carriers to disseminate the findings quickly and and answer session will hopefully make and manufacturers with other globally to all who could use them to the workshop, as well as the preparatory manufacturers; and across categories, improve international aviation safety. discussions between commenters, more e.g., labor, management, carriers, The FAA anticipates that GAIN and productive. manufacturers, air traffic controllers, its prototypes will be privately owned by a consortium of several entities from DATES: The on-line question and answer airport operators, and others must share all over the world, and the FAA plans session will be held on Tuesday, August with each other. Creating useful to invite potential participants to a 6 from 9:00 p.m., EDT (6:00 PDT) to information, however, generally workshop later this year to help 10:30 p.m., EDT (7:30 PDT) on the requires the collection of large amounts facilitate the process of developing CompuServe Information Service. of data, and it also involves the careful prototypes. In order to encourage Persons without on-line access may analysis of the data. Rarely would there prospective participants to discuss participate in the session by submitting be any need or desire to share any raw potential joint ventures with each other written questions to the FAA, which data, but the sharing of the analysis of before the workshop, the process was must be received on or before July 31, the data—the information—could be set up to enable all GAIN commenters 1996. mutually beneficial. A new safety to look at each other’s comments via the ADDRESSES: Interested persons and information paradigm, with much greater sensitivity to anomalies in daily Internet. organizational representatives with The FAA encourages commenters to aviation system operations, could help CompuServe on-line access may take maximum advantage of this the industry reach ‘‘Zero Accidents.’’ participate in the question and answer Internet capability and to commence Gathering and analyzing large amounts session by ‘‘Go’’ing to the Convention discussions with each other to Center, then selecting ‘‘FAA’s Chris Hart of qualitative and quantitative aviation determine how, working together, discusses global safety network’’ from safety data to better understand routine commenters can begin to develop the menu. Questions can also be system operations is the foundations of prototypes. The FAA has already submitted before the session via the Global Analysis and Information received numerous clarifying inquiries electronic mail to Network (GAIN) concept. about GAIN, and commenters and ‘‘[email protected].’’ On May 10, 1996, the FAA published others undoubtedly have more Interested persons without on-line a request for comments on the Global questions. The purpose of this on-line access may participate in the question Analysis and Information Network question and answer session is to and answer session by mailing (GAIN) concept and implementation provide a forum for these questions to questions to the Federal Aviation strategy for collecting and analyzing be asked and answered because better Administration, Attn: GAIN Program aviation safety data. That request also understanding of GAIN by prospective Division, ASY–200, ‘‘On-Line GAIN invited participation in the participants, and better FAA Conference,’’ 400 7th Street, SW., Room development of proof-of-concept understanding of the concerns of 2227, Washington, DC 20590. prototypes. The proposed GAIN system prospective participants, will make the FOR FURTHER INFORMATION CONTACT: would be more sensitive to conditions workshop, as well as the preparatory Mr. Charles Fluet, Manager, GAIN that signal increased safety risks discussions between commenters, much Program Division, ASY–200, Office of because it would contain information more fruitful. System Safety, Federal Aviation about normal aviation system On-line Session Procedures Administration, 400 7th Street, SW., operations. The statistical baseline for Washington, DC 20590, telephone (202) normal aviation operations, constructed (1) The on-line question and answer 267–GAIN (202–267–4246). with digital flight and ATC radar data, session is scheduled to last 90 minutes, SUPPLEMENTARY INFORMATION: among other major and currently and the FAA will try to accommodate untapped sources, would be the plumb all interested persons and organizational Background line from which deviations are representatives. If the available time The aviation industry has made measured. The importance of obtaining does not permit this, questions will be remarkable progress in reducing information about a far greater answered on a first-come-first-served aviation accident rates. However, this percentage of aircraft operations has basis. Further, the FAA reserves the rate has remained stubbornly consistent been illustrated repeatedly by all-too- right to exclude some questions if 38242 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices necessary to obtain a balance of FOR FURTHER INFORMATION CONTACT: Operations, Flight Standards Service viewpoints and issues. The session may Mr. Reginald C. Matthews Assistant (AFS–800), 800 Independence Avenue, adjourn early if all interested persons Executive Director for Air Traffic Issues, SW., Washington, DC 20591. Telephone: complete their statements and have Airspace and Rules Division (ATA– (202) 267–8452; FAX: (202) 267–5094. their questions answered in less time 400), 800 Independence Avenue, SW., than is scheduled. Washington, DC 20591, Telephone: SUPPLEMENTARY INFORMATION: Pursuant (2) Christopher A. Hart, FAA’s (202) 267–8783; FAX: (202) 267–5809. to section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92– Assistant Administrator for System SUPPLEMENTARY INFORMATION: Pursuant 463; 5 U.S.C. App. II), notice is hereby Safety, will serve as the facilitator of the to section 10(a)(2) of the Federal given of a meeting of the Aviation on-line session. A panel of FAA Advisory Committee Act (Pub. L. 92– Rulemaking Advisory Committee to representatives involved in GAIN will 463; 5 U.S.C. App. II), notice is hereby discuss general aviation operations be available to answer questions and given of a meeting of the Aviation issues. This meeting will be held on clarify issues. Rulemaking Advisory Committee. This August 20, 1996, at 9:30 a.m., at the (3) A transcript of the on-line meeting will be held on August 8, 1996, Aircraft Owners and Pilots Association, discussions will be prepared and placed at 10:00 a.m., at Helicopter Association 421 Aviation Way, Frederick, MD in the public docket at FAA International Headquarters, 1635 Prince 21701. headquarters in Washington, DC, by Street, Alexandria VA. The agenda for August 12, 1996, for review by this meeting will include: Unmanned The agenda for this meeting will interested persons. A copy of the Airborne Vehicle (UAV) draft advisory include status reports from the part 103 transcript will also be made available circular update; Special Visual flight (Ultralight Vehicles) Working Group via CompuServe from the Aviation rules (VFR) issues update; and Mode S and the IFR Fuel Requirements/ Week Group Information Center Forum working group update. Destination and Alternate Weather library by August 12, 1996. Attendance is open to the interested Minimums Working Group. In addition, (4) Statements made by FAA public but may be limited to the space the FAA will give a status report on the representatives are intended to facilitate available. The public must make Manipulation of the Controls of Aircraft discussion of, and clarify, the issues and arrangements in advance to present oral study. to answer questions. Any statements statements at the meeting or may made during the on-line session by FAA Attendance is open to the interested present written statements to the representatives are the individual views public but may be limited to the space committee at any time. In addition, sign of those representatives and do not available. The public must make and oral interpretation can be made necessarily represent the views of the arrangements in advance to present oral available at the meeting, as well as an FAA. statements at the meeting or may (5) The on-line session is designed to assistive listening device, if requested present written statements to the solicit views and clarify issues about the 10 calendar days before the meeting. committee at any time. In addition, sign GAIN concept. Therefore, the session Arrangements may be made by and oral interpretation can be made will be conducted in an informal and contacting the person listed under the available at the meeting, as well as an non-adversarial manner. No individual heading FOR FURTHER INFORMATION assistive listening device, if requested CONTACT. will be subject to cross-examination by 10 calendar days before the meeting. any other participant; however, FAA Issued in Washington, DC on July 17, 1996. Arrangements may be made by representatives may ask clarifying Reginald C. Matthews, contacting the person listed under the questions to ensure a more complete Assistant Executive Director for Air Traffic heading FOR FURTHER INFORMATION and useful record. Issues, Aviation Rulemaking Advisory CONTACT. Committee. Issued in Washington, DC, on July 18, Issued in Washington, DC on July 16, 1996. 1996. [FR Doc. 96–18551 Filed 7–22–96; 8:45 am] Louis C. Cusimano, Christopher A. Hart, BILLING CODE 4910±13±M Assistant Executive Director for General Assistant Administrator for System Safety, Aviation Operations, Aviation Rulemaking Federal Aviation Administration. Advisory Committee. Aviation Rulemaking Advisory [FR Doc. 96–18686 Filed 7–22–96; 8:45 am] Committee; Meeting [FR Doc. 96–18687 Filed 7–22–96; 8:45 am] BILLING CODE 4910±13±M BILLING CODE 4910±13±M AGENCY: Federal Aviation Administration (FAA), DOT. Aviation Rulemaking Advisory ACTION: Notice of meeting. Research, Engineering and Committee; Meeting Development Advisory Committee SUMMARY: The FAA is issuing this notice AGENCY: Federal Aviation (R,E&D); Meeting Administration (FAA), DOT. to advise the public of a meeting of the Federal Aviation Administration Pursuant to section 10(A) (2) of the ACTION: Notice of meeting. Aviation Rulemaking Advisory Federal Advisory Committee Act (Public SUMMARY: The FAA is issuing this notice Committee to discuss general aviation Law 92–463; 5 U.S.C. App. 2), notice is to advise the public of a meeting of the operations issues. hereby given of a meeting of the FAA Federal Aviation Administration DATES: The meeting will be held on Research, Engineering and Development Aviation Rulemaking Advisory August 20, 1996, at 9:30 a.m. Advisory Committee. The meeting will Committee to discuss air traffic issues. ADDRESSES: The meeting will be held at he held on Sept. 10 & 11, 1996, at the DATES: The meeting will be held on the Aircraft Owners and Pilots Holiday Inn Fair Oaks, 11787 Lee August 8, 1996, at 10:00 a.m. Association, 421 Aviation Way, Jackson Highway, Fairfax, Virginia. ADDRESSES: The meeting will be held at Frederick, MD 21701. On Tuesday, September 10 the Helicopters Association International FOR FURTHER INFORMATION CONTACT: meeting will begin at 9:00 a.m. and end Headquarters 1635 Prince Street, Mr. Louis C. Cusimano, Assistant at 5:00 p.m. On Wednesday, September Alexandria, VA. Executive Director for General Aviation 11 the meeting will begin at 8:00 a.m. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38243 and end at 1:00 p.m. The meeting Frequency of Response: On occasion. Surface Transportation Board 1 agenda will review Committee activities Estimated Number of Respondents: [STB Docket No. AB±167 (Sub-No. 1164X)] including the Report of the 2,000. Subcommittee on Human Factors, the DATES: Submit any comments to OMB Consolidated Rail CorporationÐ Report of the Scientific Advisory Panel by August 19, 1996. Forward comments Abandonment ExemptionÐin Erie for the Security R&D Subcommittee, and to: Office of Information and Regulatory County, NY a status report from the NAS R&D Panel. Affairs, Office of Management and Attendance is open to the interested Budget, Attention: Desk Officer for the Consolidated Rail Corporation public but limited to space available. Department of Transportation, Docket (Conrail) has filed a notice of exemption With the approval of the Committee Library, Room 10102, 725 17th Street, under 49 CFR Part 1152 Subpart F— Chair, members of the public may NW., Washington, DC. 20503. Exempt Abandonments to abandon a present oral statements at the meeting. FOR FURTHER INFORMATION CONTACT: 5.10-mile portion of its line of railroad Persons wishing to attend the meeting, Contact Maryann Johnson on (202) 366– known as the Walden Running Track obtain information or present oral 0438 or write to: Federal Railroad between milepost 414.00 and milepost statements, should contact Lee Olson at Administration, Office of Information 418.50, and portion of the JD Industrial the Federal Aviation Administration, Technology and Productivity Track between milepost 0.00 and AAR–200, 800 Independence Avenue, Improvement, 7th & D Streets SW., milepost 0.60 in Erie County, NY. SW., Washington, DC 20591 (202) 267– Washington, DC. 20590. Conrail has certified that: (1) No local traffic has moved over the line for at 7358. Issued in Washington, D.C. on July 17, Members of the public may present a 1996. least 2 years; (2) there is no overhead traffic on the line; (3) no formal written statement to the Committee at Ray Rogers, complaint filed by a user of rail service any time. Associate Administrator for Administration and Finance. on the line (or by a state or local Issued in Washington, DC on June 27, government entity acting on behalf of [FR Doc. 96–18696 Filed 7–22–96; 8:45 am] 1996. such user) regarding cessation of service Andres G. Zellweger, BILLING CODE 4910±06±P over the line either is pending with the Director, Aviation Research. Board or with any U.S. District Court or [FR Doc. 96–18688 Filed 7–22–96; 8:45 am] Maritime Administration has been decided in favor of complainant within the 2-year period; BILLING CODE 4910±13±M [Voluntary Intermodal Sealift Agreement and (4) the requirements at 49 CFR (VISA), 60 FR 54144, October 19, 1995] 1105.7 (environmental reports), 49 CFR 1105.8 (historic reports), 49 CFR Federal Railroad Administration Notice of Meeting of Joint Planning 1105.11 (transmittal letter), 49 CFR Advisory Group Agency Information Collection, 1105.12 (newspaper publication), and Submission for OMB Review Comment AGENCY: Maritime Administration, DOT. 49 CFR 1152.50(d)(1) (notice to Request On July 10–11, 1996, the Maritime governmental agencies) have been met. Administration and the United States As a condition to this exemption, any AGENCY: Federal Administration, Transportation Command, Co-Chairs of employee adversely affected by the Department of Transportation. the Joint Planning Advisory Group abandonment shall be protected under ACTION: Notice. (Group), hosted a meeting of the Group Oregon Short Line R. Co.— to discuss contingency movements and Abandonment—Goshen, 360 I.C.C. 91 SUMMARY: In compliance with the to start the process of developing (1979). To address whether this Paperwork Reduction Act (44 U.S.C. concepts of operations through the condition adequately protects affected 3501 et seq.) this notice announces that application of VISA sealift capacity. The employees, a petition for partial the information collection request meeting was closed to the public revocation under 49 U.S.C. 10502(d) described below has been forwarded to because material presented dealt with must be filed. the Office of Management and Budget information for official use only. Provided no formal expression of (OMB) for review. CONTACT PERSON FOR ADDITIONAL intent to file an offer of financial OMB Control Number: 2130–0517. INFORMATION: James E. Caponiti, assistance (OFA) has been received, this Title and Form Number: Associate Administrator for National exemption will be effective on August Supplemental Qualifications Statement Security (202) 366–5400. 22, 1996, unless stayed pending reconsideration. Petitions to stay that do for Railroad Safety Inspector By Order of the Maritime Administrator. Applicants, FRA–F–120. not involve environmental issues,2 Dated: July 17, 1996. Type of Review: Extension of a Joel C. Richard, 1 currently approved collection. The ICC Termination Act of 1995, Pub. L. No. Secretary. 104–88, 109 Stat. 803, which was enacted on Need and Uses: To evaluate the [FR Doc. 96–18695 Filed 7–22–96; 8:45 am] December 29, 1995, and took effect on January 1, qualifications of applicants for Railroad 1996, abolished the Interstate Commerce Safety Inspector positions. The BILLING CODE 4910±81±P Commission and transferred certain functions to the Surface Transportation Board (Board). This notice questions cover a wide range of general relates to functions that are subject to the Board’s and specialized skills, abilities, and jurisdiction pursuant to 49 U.S.C. 10903. knowledge of the five types of railroad 2 The Board will grant a stay if an informed safety inspector positions. decision on environmental issues (whether raised by a party or by the Board’s Section of Affected Public: Individuals or Environmental Analysis in its independent Households. investigation) cannot be made before the Estimated Annual Burden: 6,000 exemption’s effective date. See Exemption of Out- hours. of-Service Rail Lines, 5 I.C.C.2d 377 (1989). Any request for a stay should be filed as soon as possible Estimated Average Burden Per so that the Board may take appropriate action before Respondent: 3 hours. the exemption’s effective date. 38244 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices formal expressions of intent to file an submission(s) may be obtained by addressed to the OMB reviewer listed OFA under 49 CFR 1152.27(c)(2),3 and calling the Treasury Bureau Clearance and to the Treasury Department trail use/rail banking requests under 49 Officer listed. Comments regarding this Clearance Officer, Department of the CFR 1152.29 4 must be filed by August information collection should be Treasury, Room 2110, 1425 New York 2, 1996. Petitions to reopen or requests addressed to the OMB reviewer listed Avenue, NW., Washington, DC 20220. for public use conditions under 49 CFR and to the Treasury Department Internal Revenue Service (IRS) 1152.28 must be filed by August 12, Clearance Officer, Department of the 1996, with: Office of the Secretary, Case Treasury, Room 2110, 1425 New York OMB Number: 1545–0173 Control Branch, Surface Transportation Avenue, NW., Washington, DC 20220. Form Number: IRS Form 4563 Board, 1201 Constitution Avenue, N.W., Type of Review: Extension Internal Revenue Service (IRS) Washington, DC 20423. Title: Exclusion of Income for Bona A copy of any petition filed with the OMB Number: 1545–0094. Fide Residents of American Samoa Board should be sent to applicant’s Form Number: IRS Form 1041–A. Description: Used by bona fide representative: John K. Enright, Type of Review: Extension. residents of American Samoa whose Associate General Counsel, Title: U.S. Information Return—Trust income is from sources within Consolidated Rail Corporation, 2001 Accumulation of Charitable Amounts. American Samoa, Guam, and the Market Street—16A, Philadelphia, PA Description: Form 1041–A is used to Northern Mariana Islands to the extent 19101–1416. report the information required 26 USC specified in Internal Revenue Code If the verified notice contains false or 6034 concerning accumulation and section 931. This information is used by misleading information, the exemption distribution of charitable amounts. The the Service to determine if an individual is void ab initio. data is used to verify that amounts for is eligible to exclude possession source Conrail has filed an environmental which a charitable deduction was income. report which addresses the allowed are used for charitable Respondents: Individuals or abandonment’s effects, if any, on the purposes. households environment and historic resources. The Respondents: Business or other for- Estimated Number of Respondents/ Section of Environmental Analysis profit, Individual or households. Recordkeepers: 100. (SEA) will issue an environmental Estimated Number of Respondents/ Estimated Burden Hours Per assessment (EA) by July 26, 1996. Recordkeepers: 18,000. Respondent/Recordkeeper: Interested persons may obtain a copy of Estimated Burden Hours Per Recordkeeping—33 min. the EA by writing to SEA (Room 3219, Respondent/Recordkeeper: Learning about the law or the Surface Transportation Board, Recordkeeping—24 hr., 9 min. form—7 min. Washington, DC 20423) or by calling Learning about the law or the Preparing the form—25 min. Elaine Kaiser, Chief of SEA, at (202) form—3 hr., 26 min. Copying, assembling, and sending 927–6248. Comments on environmental Preparing the form—8 hr., 38 min. the form to the IRS—17 min. and historic preservation matters must Copying, assembling, and sending Frequency of Response: Annually be filed within 15 days after the EA the form to the IRS—1 hr., 20 min. Estimated Total Reporting/ becomes available to the public. Frequency of Response: Annually. Recordkeeping Burden: 137 hours Environmental, historic preservation, Estimated Total Reporting/ Clearance Officer: Garrick Shear (202) public use, or trail use/rail banking Recordkeeping Burden: 675,900 hours. 622–3869, Internal Revenue Service, conditions will be imposed, where Clearance Officer: Garrick Shear (202) Room 5571, 1111 Constitution Avenue, appropriate, in a subsequent decision. 622–3869, Internal Revenue Service, N.W., Washington, DC 20224. Decided: July 18, 1996. Room 5571, 1111 Constitution Avenue, OMB Reviewer: Milo Sunderhauf By the Board, David M. Konschnik, NW., Washington, DC 20224. (202) 395–7340, Office of Management Director, Office of Proceedings. OMB Reviewer: Milo Sunderhauf and Budget, Room 10226, New Vernon A. Williams, (202) 395–7340, Office of Management Executive Office Building, Washington, Secretary. and Budget, Room 10226, New DC 20503. [FR Doc. 96–18624 Filed 7–22–96; 8:45 am] Executive Office Building, Washington, Dale A. Morgan, BILLING CODE 4915±00±P DC 20503. Departmental Reports, Management Officer. Dale A. Morgan, [FR Doc. 96–18567 Filed 7–22–96; 8:45 am] Departmental Reports Management Officer. BILLING CODE 4830±01±P DEPARTMENT OF THE TREASURY [FR Doc. 96–18566 Filed 7–22–96; 8:45 am] BILLING CODE 4830±01±P Submission To OMB for Review; Submission To OMB for Review; Comment Request Comment Request Submission To OMB for Review; July 15, 1996. Comment Request July 15, 1996. The Department of Treasury has The Department of Treasury has submitted the following public July 15, 1996. submitted the following public information collection requirement(s) to The Department of Treasury has information collection requirement(s) to OMB for review and clearance under the submitted the following public OMB for review and clearance under the Paperwork Reduction Act of 1995, information collection requirement(s) to Paperwork Reduction Act of 1995, Public Law 104–13. Copies of the OMB for review and clearance under the Public Law 104–13. Copies of the Paperwork Reduction Act of 1995, submission(s) may be obtained by 3 See Exempt. of Rail Abandonment—Offers of Public Law 104–13. Copies of the calling the Treasury Bureau Clearance Finan. Assist., 4 I.C.C.2d 164 (1987). submission(s) may be obtained by Officer listed. Comments regarding this 4 The Board will accept late-filed trail use requests so long as the abandonment has not been calling the Treasury Bureau Clearance information collection should be consummated and the abandoning railroad is Officer listed. Comments regarding this addressed to the OMB reviewer listed willing to negotiate an agreement. information collection should be and to the Treasury Department Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38245

Clearance Officer, Department of the Description: Taxpayers required to the actual method (Part I) or the Treasury, Room 2110, 1425 New York account for all or part of any long-term Simplified Marginal Impact Method Avenue, NW., Washington, DC 20220. contract entered into after February 28, (Part II). Internal Revenue Service (IRS) 1986, under the percentage of Respondents: Individuals or completion method must use Form 8697 households, business or other for-profit. OMB Number: 1545–1031 to compute and report interest due or to Form Number: IRS Form 8697 Estimated Number of Respondents/ be refunded under IRC section 460(b)(3). Type of Review: Extension Recordkeepers: 5,000. Title: Interest Computation Under the The IRS uses Form 8697 to determine if Look-Back Method for Completed Long- the interest has been figured correctly. Estimated Burden Hours Per Term Contracts Taxpayers may compute interest using Respondent/Recordkeeper:

Form 8697 Form 8697 Part I Part II

Recordkeeping ...... 8 hr., 22 min...... 9 hr., 5 min. Learning about the law or the form ...... 2 hr., 11 min...... 1 hr., 35 min. Preparing, copying, assembling, and sending the form to the IRS ...... 2 hr., 25 min...... 1 hr., 49 min.

Frequency of Response: Annually. received on or before September 23, may be properly considered and filed Estimated Total Reporting/ 1996. when received by the VA. Recordkeeping Burden: 63,840 hours. ADDRESSES: Direct all written comments Affected Public: Not-for-profit Clearance Officer: Garrick Shear (202) to Sue Hamlin, Board of Veterans’ institutions. 622–3869, Internal Revenue Service, Appeals (01C), Department of Veterans Estimated Annual Burden: 40,000 Room 5571, 1111 Constitution Avenue, Affairs, 810 Vermont Avenue, NW., hours. Estimated Average Burden Per NW., Washington, DC 20224. Washington, DC 20420. All comments Respondent: 1 hour. OMB Reviewer: Milo Sunderhauf will become a matter of public record Frequency of Response: On occasion. (202) 395–7340, Office of Management and will be summarized in the BVA Estimated Number of Respondents: and Budget, Room 10226, New request for Office of Management and 40,000. Executive Office Building, Washington, Budget (OMB) approval. In this DC 20503. document the BVA is soliciting FOR FURTHER INFORMATION CONTACT: Dale A. Morgan, comments concerning the following Requests for additional information or Departmental Reports, Management Officer. information collection: copies of the form should be directed to Department of Veterans Affairs, Attn: [FR Doc. 96–18568 Filed 7–22–96; 8:45 am] OMB Control Number: 2900–0042. BILLING CODE 4830±01±P Jacquie McCray, Information Title and Form Number: Statement of Management Service (045A4), 810 Accredited Representative in Appealed Vermont Avenue, NW., Washington, DC Case, VA Form 646. 20420, Telephone (202) 273–8032 or DEPARTMENT OF VETERANS Type of Review: Extension of a FAX (202) 273–5981. AFFAIRS currently approved collection. Dated: July 10, 1996. Need and Uses: The form is used by Agency Information Collection By direction of the Secretary. accredited representative of veterans’ Activities: Proposed Collection; Donald L. Neilson, Comment Request service organizations to present argument to the BVA on behalf of Director, Information Management Service. AGENCY: Board of Veterans’ Appeals, appellants whom the service [FR Doc. 96–18580 Filed 7–22–96; 8:45 am] Department of Veterans Affairs. organizations represent. Further, it aids BILLING CODE 8320±01±P ACTION: Notice. the VA in assuring that rights to representation have been honored by SUMMARY: As part of its continuing effort establishing that the record has been Summary of Precedent Opinions of the to reduce paperwork and respondent made available to the representative for General Counsel burden, the Board of Veterans’ Appeals review and presentation of argument. AGENCY: Department of Veterans Affairs. (BVA) invites the general public and Current Actions: The form is provided ACTION: Notice. other Federal agencies to comment on primarily as a courtesy to the this information collection. This request representative, although it also assists SUMMARY: The Department of Veterans for comment is being made pursuant to the VA in carrying out its mission. It is Affairs (VA) is publishing a summary of the Paperwork Reduction Act of 1995 used by accredited veterans’ service legal interpretations issued by the (Public Law 104–13; 44 U.S.C. organization representatives throughout Department’s General Counsel involving 3506(c)(2)(A)). Comments should the nation to submit their argument in veterans’ benefits under laws address the accuracy of the burden individual appeals to the BVA. It administered by VA. These estimates and ways to minimize the facilitates appellants’ exercise of their interpretations are considered burden including the use of automated representation rights. The legal and precedential by VA and will be followed collection techniques or the use of other factual arguments presented on the form by VA officials and employees in future forms of information technology, as well are considered and addressed by the claim matters. It is being published to as other relevant aspects of the BVA in making decisions on appeals. provide the public, and, in particular, information collection. The form is also designed to solicit veterans’ benefit claimants and their DATES: Written comments and enough identifying data to enable the representatives, with notice of VA’s recommendations on the proposal for VA to identify the particular case to interpretation regarding the legal matter the collection of information should be which the statement pertains so that it at issue. 38246 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices

FOR FURTHER INFORMATION CONTACT: Jane U.S.C. 103(a), the effective date of the By Direction of the Secretary. L. Lehman, Chief, Law Library, award to the legal surviving spouse is Mary Lou Keener, Department of Veterans Affairs, 810 governed by 38 U.S.C. 5110(a), which General Counsel. Vermont Avenue, NW., Washington, DC provides for establishment of an [FR Doc. 96–18582 Filed 7–22–96; 8:45 am] 20420, (202) 273–6558. effective date in accordance with the BILLING CODE 8320±01±M SUPPLEMENTARY INFORMATION: VA facts found, but not earlier than the date regulations at 38 CFR 2.6(e)(9) and of receipt of an application for benefits. 14.507 authorized the Department’s The effective date of the discontinuance Advisory Committee on Minority to the prior payee is governed by 38 General Counsel to issue written legal Veterans, Notice of Meeting opinions having precedential effect in U.S.C. 5112(b)(6) and 38 CFR 3.114(b). adjudications and appeals involving To the extent that application of 38 CFR The Department of Veterans Affairs 3.657(a) would, in a particular case, veterans’ benefits under laws (VA), in accordance with Public Law administered by VA. The General suggest that the prior payee’s award be 103–446, gives notice that a meeting of Counsel’s interpretations on legal terminated at a date earlier than that the Advisory Committee on Minority matters, contained in such opinions, are provided by 38 U.S.C. 5112(b)(6), that conclusive as to all VA officials and regulation must be considered Veterans will be held August 1, 1996, in employees not only in the matter at superseded by section 5112(b)(6). Washington, DC. The purpose of the Advisory Committee on Minority issue but also in future adjudications EFFECTIVE DATE: February 17, 1996. and appeals, in the absence of a change Veterans is to advise the Secretary of in controlling statute or regulation or a VAOPGCPREC 2–96 Veterans Affairs on the administration of VA benefits and services for minority superseding written legal opinion of the Question Presented: Whether, under veterans and to assess the needs of General Counsel. 38 U.S.C. 5313, a veteran who was VA publishes summaries of such paroled after being incarcerated for minority veterans and evaluate whether opinions in order to provide the public conviction of a felony is entitled to full VA compensation, medical and with notice of those interpretations of compensation for a service-connected rehabilitation services, outreach, and the General Counsel that must be disability for the period during which other programs are meeting those needs. followed in future benefit matters and to he violated the conditions of parole? The Committee will make assist veteran’s benefit claimants and Held: The provisions of 38 U.S.C. recommendations to the Secretary their representatives in the persecution regarding such activities. of benefit claims. The full text of such 5313 do not apply to a veteran who is opinions, with personal identifiers a parole following incarceration for The meeting will convene in room deleted, may be obtained by contacting conviction of a felony and who is in 530, VA Central Office (VACO) the VA official named above. violation of one or more of the Building, 810 Vermont Avenue, NW., conditions of parole, unless the veteran Washington, DC, from 2:00 p.m. to 5:30 VAOPGCPREC 1–96 has been reincarcerated. p.m. The meeting will be conducted by Questions Presented: a. Do the EFFECTIVE DATE. May 13, 1996. way of a conference call. Committee provisions of 38 CFR 3.114(b) apply to members residing in the Washington VAOPGCPREC 3–96 cases in which benefits are reduced or Metropolitan area will be present in terminated as the result of a judicial Question Presented: How should room 530. All other members will be precedent? reimbursements for the costs of VA linked via telephone. The Committee b. If so, when, in such cases, benefits furnished medical care received from will meet to work on recommendations are awarded to one individual as the health insurance policies of insured to be included in its annual report to the surviving spouse of a veteran and veterans be applied to their obligation to Secretary. The Committee will continue discontinued to another individual pay VA a portion of the cost of that previously awarded benefits based on a to discuss subcommittee reports and care? findings. The Committee will complete ‘‘deemed valid’’ marriage to the veteran, Held: 1. Veterans covered by health is the effective date of the drafting of the annual report to the insurance policy who are obligated to Secretary. All sessions will be open to discontinuance of the latter individual’s VA for a portion of the cost of their benefits governed by 38 CFR 3.114(b) or the public up to the seating capacity of nonservice-connected medical care the room. Because seating is limited, it 38 CFR § 3.657(a)? should be allowed to satisfy their Held: a. The provisions of 38 U.S.C. will be necessary for those wishing to obligation(s) to VA to the extent of 5112(b)(6) and 38 CFR 3.114(b), which attend to contact Mrs. Angelia Sare, coverage available under their policies. govern the effective date of a reduction Department of Veterans Affairs (phone 2. Non-Medigap insurance proceeds or discontinuance of benefits by reason (202) 273–6708) prior to July 31, 1996. should be applied to the veteran’s VA of a change in law or administrative No time will be allocated for the copayment debt, after subtracting the issue or a change in interpretation of a policy deductible, by applying the same purpose of receiving oral presentations law or administrative issue, are percentage factor of payment as from the public; however, the applicable to cases in which benefits are corresponds to the insurer’s liability for Committee will accept appropriate reduced or terminated by reason of a the remainder of allowable charges. written comments from interested change in the interpretation of law parties on issues affecting minority resulting from a judicial precedent. 3. Reimbursements from Medigap carriers should first be applied to the veterans. Such comments should be b. When, as the result of such a referred to the Committee at the change in interpretation, an award of veterans’ copayment debt(s), including following address: Advisory Committee benefits is established for one ‘‘means test’’ copayment, per diem on Minority Veterans, Center for individual as the legal surviving spouse copayments, outpatient copayments, Minority Veterans (00M), U.S. of a veteran and discontinued for and prescription copayments before another individual who had previously application of those proceeds to the Department of Veterans Affairs, 810 received benefits based on a marriage to carrier’s debt. Vermont Avenue, NW., Washington, DC the veteran deemed valid pursuant to 38 Effective Date: May 23, 1996. 20420. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Notices 38247

Dated: July 16, 1996. Heyward Bannister, Committee Management Officer. [FR Doc. 96–18581 Filed 7–22–96; 8:45 am] BILLING CODE 8320±01±M federal register July 23,1996 Tuesday Proposed Rule and NonattainmentNewSourceReview; Prevention ofSignificantDeterioration 40 CFRParts51and52 Protection Agency Environmental Part II 38249 38250 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

ENVIRONMENTAL PROTECTION and Program Integration Division, MD– 4. Additional Guidance for BACT AGENCY 12, Office of Air Quality Planning and Determinations Standards (OAQPS), U.S. EPA, Research C. Improving Information about Available Triangle Park, North Carolina 27711, Control Technologies: Changes to the 40 CFR Parts 51 and 52 Reasonably Available Control (919) 541–0871. Persons wishing to [AD±FRL±5455±7] Technology (RACT)/BACT/Lowest make oral presentations at the public Achievable Emission Rate (LAER) RIN 2060±AE11 hearing, or seeking further information, Clearinghouse (RBLC) should contact Pam J. Smith at (919) D. Streamline Proposed to BACT/LAER Prevention of Significant Deterioration 541–5319. Determinations (PSD) and Nonattainment New Source SUPPLEMENTARY INFORMATION: The 1. Permit Applications Must Include Review (NSR) following outline reflects the contents of Analysis of Control Technologies That Are Demonstrated in Practice this action: AGENCY: Environmental Protection 2. Permitting Authority May Limit Agency (EPA). I. Overview of This Proposal Consideration of New or Emerging A. Introduction Technologies After Complete ACTION: Notice of proposed rulemaking. B. Background Application II. Applicability of the NSR Program E. Proposed Complete Application Criteria SUMMARY: The EPA is proposing to A. Overview F. Proposed Undemonstrated Control revise regulations for both the approval B. Background Technology or Application (UT/A) and promulgation of implementation 1. Current Provisions 1. Introduction plans and the requirements for 2. Litigation over the Actual-to-Potential 2. Description of Proposed UT/A Waiver preparation, adoption, and submittal of Test G. Pollution Prevention implementation plans governing the 3. The Wisconsin Electric Power Company 1. The Pollution Prevention Act (PPA) and NSR programs mandated by parts C and (WEPCO) Rulemaking the EPA’s Pollution Prevention Policies D of title I of the Clean Air Act (Act). C. The Proposed ‘‘Clean Unit’’ and ‘‘Clean 2. Pollution Prevention in BACT and LAER Facility’’ Exclusion H. States’ Discretion to Adopt or Enforce These proposed changes are largely 1. Introduction More Stringent Requirements drawn from the discussions and 2. Description of the Clean Unit Proposal I. Addressing the EPA’s Obligation Under recommendations of the Clean Air Act 3. What Constitutes a ‘‘Clean Unit’’ Pending Settlement Agreement Advisory Committee’s (CAAAC) 4. Description of the Clean Facility IV. Class I Areas Subcommittee on NSR Reform. The Proposal A. Introduction proposed changes are intended to D. Revision to the Netting Baseline B. Background reduce costs and regulatory burdens for 1. Introduction 1. Overview of PSD Requirements for Class permit applicants, while still ensuring 2. Description of Proposed Netting Baseline I Areas that emissions from new or modifying 3. Protection of Short-term Increments and 2. The Need to Improve PSD Requirements National Ambient Air Quality Standards Related to the Protection of Air Quality major stationary sources of air pollution (NAAQS) Related Values (AQRV) in Class I Areas will not interfere with efforts to attain E. Proposed Pollution Control Project C. The EPA Proposal and maintain the nation’s air quality Exclusion 1. Defining AQRV and Determining standards and goals. 1. Background Adverse Impacts DATES: Comments. All public comments 2. Description of Proposed Exclusion of 2. Improving Federal Land Manager (FLM)/ must be received on or before October Pollution Control Projects Permitting Authority Coordination 21, 1996. 3. The Environmentally Beneficial Test 3. Mitigating an Adverse Impact on AQRV 4. Procedural Safeguards 4. Class I Significant Impact Levels Public Hearing. A public hearing is 5. Emission Reduction Credits 5. Clarification of Miscellaneous Issues scheduled for 8:30 a.m. to 4:30 p.m. in F. Proposed Plantwide Applicability Limits 6. Information Clearinghouse (Federal Research Triangle Park, North Carolina (PAL) Class I areas) September 23, 1996. The hearing may be 1. Background 7. Visibility New Source Review canceled if no requests to speak have 2. Description of PAL’s Proposal V. Prevention of Significant Deterioration been received 15 days prior to the 3. Discussion Preconstruction Monitoring scheduled hearing date. G. Actual-to-Future-Actual Methodology VI. Changes Resulting From the 1990 Clean 1. Background Air Act Amendments (1990 ADDRESSES: Comments. Comments on 2. Limitation of the WEPCO Rule to One Amendments) this proposal should be mailed (in Source Category A. NSR Provisions for Nonattainment Area duplicate if possible) to: U.S. EPA, Air 3. Issues Regarding the Future-Actual Permitting Docket Section, Air Docket A–90–37; Methodology 1. Provisions for Ozone Nonattainment 401 M Street SW., Washington, DC H. Proposal of Chemical Manufacturers Areas 20460. Association (CMA) Exhibit B 2. Provisions for Carbon Monoxide (CO) Docket. Supporting information for 1. Description of the Exhibit B Nonattainment Areas this proposal is contained in Docket No. Methodology 3. Provisions for PM–10 Nonattainment A–90–37. This docket is available for 2. The EPA’s Preliminary Analysis Areas 3. The EPA Action 4. Statutory Restrictions for New Sources public review and copying between 8:00 I. Allowed Activities Prior to Receipt of 5. Applicability of Nonattainment NSR to a.m. and 4:00 p.m., Monday through Permit Internal Combustion Engines Friday at the EPA’s Air Docket Section, III. Proposed Revisions to Control B. NSR Provisions for Prevention of 401 M Street SW., Washington, DC; Technology Review Requirements Significant Deterioration Room M–1500. A reasonable fee may be A. Introduction 1. Stratospheric Ozone-Depleting charged for copying. B. Proposed Revisions to the Methodology Substances Public Hearing. A document for Determining Best Available Control 2. Listed Hazardous Air Pollutants (HAP) announcing the specific location of the Technology (BACT) 3. Applicability of PSD Requirements to public hearing will be published in the 1. General Description of the BACT Internal Combustion Engines Determination Process C. Control Technology Information Federal Register. 2. The Core Criteria VII. Other Proposed Changes FOR FURTHER INFORMATION CONTACT: 3. Description of the Federal Methodology A. Emissions Credits Resulting From Dennis Crumpler, Information Transfer for Determining BACT Source Shutdowns and Curtailments Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38251

B. Judicial Review of NSR Permits prevention projects—Existing sources authority and the applicant with regard C. Department of Defense (DOD) Concerns that have clean emissions units or are to the NSR permitting process. The VIII. Additional Information undertaking projects to clean up air steps in considering of Class I area A. Public Docket pollution should not be targeted for issues are clarified and would be B. Public Comments and Public Hearing major NSR. initiated earlier in the permit review C. Executive Order (EO) 12866 • D. Regulatory Flexibility Act Promotion of voluntary plant-wide process than in current regulations. De E. Paperwork Reduction Act limits—Rather than face complicated, minimis levels for determining whether F. Unfunded Mandates Reform Act piecemeal applicability decisions every Class I increment analyses must be time a change at a plant is performed would be established. The I. Overview of This Proposal contemplated, plant managers may changes should reduce delays and A. Introduction prefer to work within an emissions cap disputes associated with permitting near or emissions budget, an annual The EPA is proposing substantial Federal Class I areas. emissions limit that allows managers to • Increased State flexibility—Instead changes to the major NSR program, a make almost any change anytime as of one-size-fits-all solutions to preconstruction permitting program long as the plant’s emissions do not applicability and other issues, States required by the Clean Air Act (Act) that exceed the cap. Today’s action proposes will be allowed for the first time to regulates the construction and to create this option in EPA’s choose applicability and modification of major stationary sources regulations. implementation approaches from a of air pollution. This proposal • Applicability criteria to reflect real menu of alternatives. represents the first comprehensive emissions increases—This proposal • The EPA is taking comment on the overhaul of the program in 15 years. The would extend the range of years sources range of preliminary construction proposed revisions are largely drawn can use to establish their historical activities that might be allowed to from the recommendations and emissions and would allow sources to proceed prior to the issuance of an NSR deliberations of the CAAAC’s NSR calculate emissions increases using permit in cases of modifications at Reform Subcommittee, a panel of projected future actual emissions rather existing facilities. industry representatives, State and local than maximum potential to emit (PTE). • More offset credits available to air pollution control officials, This will especially benefit cyclical nonattainment area sources—Proposed environmentalists and other experts. industries which during economic changes will ease restrictions on use of This proposal also contains certain downturns are currently penalized for emissions reductions credits resulting revisions to the NSR regulations for making modernizing changes that are from source shutdowns and State Implementation Plans (SIP) based vital to their recovery, even when the curtailments. on requirements established by the 1990 changes lower emissions rates. • New definition to ensure that the • Amendments. These revisions are Encouragement of pollution definition of ‘‘stationary source’’ proposed here in order to clarify certain prevention and innovative control included stationary internal combustion requirements of the 1990 Amendments. technologies—these proposed changes engines, but excludes newly-defined The adoption of the proposed changes would ensure that pollution prevention ‘‘nonroad engines’’ and ‘‘nonroad will resolve a number of the underlying qualifies for the pollution control vehicles.’’ issues that have impeded full adoption project exclusion and revamp the under- Proposed deregulatory changes that of the nonattainment NSR programs by used innovative control technology are authorized by the 1990 Amendments some States and caused uncertainties in waiver to simplify the process and include: the permitting process thereby delaying eliminate penalties for good faith • Exclusion of HAP from PSD some projects. Other revisions, based on failures. requirements. the CAAAC that are deregulatory in • Enhanced Public Awareness— • Requirements on ozone-depleting nature have also been included. Increased public disclosure of source substances (ODS)—Relaxes PSD If adopted, the proposed reforms will impacts on Class I areas, establishment requirements on the substitution of ODS significantly reduce the number and of national database of major permit with lower potency. types of activities at sources that would applications, and improvements to Revisions in this document that are otherwise be subject to major NSR EPA’s pollution control technology being proposed based on requirements under the existing NSR program bulletin board to increase opportunities mandated by the 1990 Amendments are: regulations, including the new and for informed citizen participation in key • Revised major source thresholds revised requirements imposed by the permitting decisions. and emissions offset ratios for sources of 1990 Amendments. At the same time, • Revised requirements for control volatile organic compounds (VOC), the proposed changes are intended to technology determinations—These nitrogen oxides (NOX), particulate provide States with greater flexibility to proposed changes would allow States to matter with diameter of 10 microns or customize their own regulations adopt their own methodologies for less (PM–10) and CO according to implementing the NSR program, address reviewing and determining BACT so severity of a nonattainment area’s concerns raised about the permitting of long as control technology evaluations ambient air quality problem. sources near protected National Parks include reasoned consideration of the • Special requirements for and other wilderness areas (Federal most stringent control technology. Other determining major modifications of Class I areas), promote the use of proposed changes clarify the extent of a VOC and NOX sources in serious and innovative technologies and pollution source’s duty to search out new severe ozone nonattainment areas. prevention, and, in general, streamline technology and shorten the technology • Requirements for the submittal of the overall NSR permitting process. review process by providing control technology information into the The key elements of this proposal presumptive cut-offs. EPA’s RACT/BACT/LAER designed to relieve regulatory burden • Better coordination of permit Clearinghouse. are: reviews for sources potentially affecting This proposal also includes proposed • Deregulation of changes at ‘‘clean’’ air quality in Federal Class I areas— ‘‘housekeeping’’ revisions to the NSR emissions units and ‘‘clean’’ facilities These proposed changes clarify the role regulations at § 51.165(a) (NSR in and of pollution control and pollution of the FLM, the State permitting nonattainment areas) for control 38252 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules technology review, complete assure that the NAAQS are achieved in this document do not application criteria, and public and maintained; to protect areas of clean comprehensively address all the participation, which are consistent with air; to protect AQRV (including statutory revisions to the NSR program similar provisions under the PSD visibility) in national parks and other in the 1990 Amendments. regulations at §§ 51.166 and 52.21. natural areas of special concern; to Consequently, EPA’s promulgation of Further, consistent with proposed assure appropriate emission controls are any or all revisions in this proposal reform-related revisions to public applied; to maximize opportunities for should not create the expectation that participation provisions, the EPA is also economic development consistent with States and permit applicants may obtain proposing provisions that clarify permit the preservation of clean air resources; program approvals or be issued permits, applicants’ and the public’s and to ensure that any decision to respectively, by solely following the opportunities for judicial review in increase air pollution is made only after NSR rules, as proposed or ultimately State court regarding PSD or full public consideration of all the promulgated. nonattainment permit actions. consequences of such a decision. See, II. Applicability of the NSR Program Finally, the EPA is proposing e.g., sections 101(b)(1), 110(a)(2)(C), 160, clarification of source definition criteria and 173 of the Act. A. Overview as they relate to military installations On November 15, 1990, Congress The issue of NSR applicability proved during ‘‘national security emergencies’’. enacted numerous changes to title I of to be one of the most difficult and the Act, including changes involving the B. Background divisive issues for the CAAAC’s NSR NSR provisions under parts C and D for Reform Subcommittee. While the issue The NSR program legislated by major new sources and major was considered by a subgroup of the Congress in parts C and D of title I of modifications locating in attainment Subcommittee for several months and the Act is a preconstruction review and and unclassifiable areas, nonattainment debated by the full Subcommittee permitting program applicable to new or areas, and ozone transport regions. Most during several sessions, consensus modified major stationary sources of air of these changes are described in the proved elusive. As a result, no formal pollutants regulated under the Act.1 ‘‘General Preamble for Implementation recommendations were proffered to the In areas not meeting health-based of Title I of the Clean Air Act CAAAC or the EPA on this issue. Still NAAQS and in ozone transport regions Amendments of 1990’’ (General the discussions provided the EPA with (OTR), the program is implemented Preamble; see 57 FR 13498, April 16, a better understanding of the concerns under the requirements of part D of title 1992). The EPA has not yet revised its of all sides and revealed a few areas of I of the Act for ‘‘nonattainment’’ NSR. NSR regulations to reflect the statutory potential agreement. There were In areas meeting NAAQS (‘‘attainment’’ changes resulting from the 1990 common elements in many of the areas) or for which there is insufficient Amendments. competing proposals circulated by information to determine whether they In August 1992, amidst concerns members of the Subcommittee. Thus, meet the NAAQS (‘‘unclassifiable’’ expressed by regulated industries that while there was no CAAAC resolution areas), the NSR requirements for the the EPA’s major NSR regulations were of the issues, today’s proposed prevention of significant deterioration of too complex and burdensome, the EPA applicability changes build upon the air quality under part C of title I of the began an effort to revise those Subcommittee’s deliberations. Act apply. These regulations are regulations. This effort involved the This preamble discusses the following contained in 40 CFR 51.165, 51.166, solicitation of ideas and proposed changes to NSR applicability: 52.21, 52.24 and part 51 appendix S. recommendations from the CAAAC, as (1) A new exclusion from major NSR for The NSR provisions of the Act are a 2 well as public input. The goal of the existing emissions units and facilities combination of air quality planning and NSR Reform effort is to eliminate as that are subject to BACT or LAER, air pollution control technology much of the program complexity, equivalent minor NSR control program requirements for new and administrative burden and resultant requirements, or comparable ‘‘clean’’ modified stationary sources of air project delays as possible without emissions control technology (see pollution. In brief, section 109 of the sacrificing the current level of section II.C); (2) a new baseline for Act requires the EPA to promulgate environmental protection and benefits determining if a physical or operational primary NAAQS to protect public derived from the program. change will result in a significant net health and secondary NAAQS to protect In today’s action, the EPA is emissions increase and thereby trigger public welfare. Once these standards proposing changes to various aspects of major NSR, allowing sources to use any have been set, States must develop, the current NSR program based 12 consecutive months in the past 10 adopt, and submit to the EPA for primarily on its consideration of years to establish the unit’s pre-change approval a SIP which contain emission recommendations provided through the emissions level (see section II.D); (3) a limitations and other control measures NSR Reform effort, but also based on pollution control project exclusion, to attain and maintain the NAAQS and independent EPA initiatives to clarify patterned after the exclusion recently to meet the other requirements of the NSR program. The EPA further adopted by EPA for utilities but section 110(a) of the Act. proposes to add certain new covering all source categories and Each SIP is required to contain a requirements established by the 1990 pollution prevention projects (see preconstruction review program for the Amendments. section II.E); (4) a new provision construction and modification of any The reader should note that the allowing States to base applicability on stationary source of air pollution to proposed new and revised regulations a PAL (see section II.F); and (5) 1 Section 112(g) of the Act provides for 2 The meetings of the CAAAC and its NSR Reform extension of a version of the ‘‘actual-to- preconstruction review of HAP. Section 112(b)(6) of Subcommittee are announced in the Federal future-actual’’ test, currently only the Act specifies that the ‘‘part C’’ PSD program Register and open to the public. The last meeting available for utilities, to all source shall not apply to HAP listed under section 112. of the NSR Subcommittee was in July 1994. A categories (see section II.G). Finally, the The EPA has published guidance on NSR preliminary draft of this rulemaking was discussed implementation issues presented by these at that meeting and made available for public EPA is proposing for comment an provisions. See 57 FR 18074–18075 (April 28, comments. A copy is in the Docket for this applicability approach which the EPA 1992). rulemaking. See 59 FR 35119 (July 8, 1994). agreed to consider and take final action Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38253 on in accordance with the settlement of source with a ‘‘PTE’’ in excess of the maintenance, repair and replacement, a lawsuit with the CMA and other applicable threshold amount ‘‘triggers’’ and changes in hours of operation or in industry petitioners (see section II.H). or is subject to major NSR.3 the production rate are not by In the past, EPA has essentially The determination of what should be themselves considered a physical required States to follow a single classified as a modification subject to change or change in the method of applicability methodology. States could, major NSR presents more difficult operation within the definition of major of course, have a more stringent issues. The modification provisions of modification. See, e.g., existing approach but most followed closely the the NSR programs in parts C and D are §§ 52.21(b)(2)(iii), 52.24(f)(5)(iii), EPA prototype. The EPA is proposing to based on the broad definition of 51.165(a)(1)(v)(C)(1), and break with this one-size-fits-all modification in section 111(a)(4) of the 51.166(b)(2)(iii). approach to applicability by proposing Act: the term ‘‘modification’’ means The EPA has likewise limited the to adopt these changes as a menu of ‘‘any physical change in, or change in reach of the second step of the statutory options from which a State may pick the method of operation of, a stationary definition of modification by excluding and choose in order to customize a source which increases the amount of all changes that do not result in an specific approach for its individual any air pollutant emitted by such source emissions increase above ‘‘significance’’ needs. Thus, in its final action on this or which results in the emission of any levels for the pollutant in question. See, rulemaking, EPA will consider placing air pollutant not previously emitted.’’ e.g., existing § 51.165(a)(1)(x). Taken all or some of the applicability options That definition contemplates a two-step together, these regulatory limitations presented today as permissible test for determining whether activities at restrict the application of the NSR alternatives in its part 51 regulations an existing major facility constitute a program in parts C and D to only ‘‘major containing minimum requirements for major modification subject to major NSR modifications’’ at existing major State NSR programs in nonattainment requirements. In the first step, the stationary sources. See, e.g., existing and attainment/unclassified areas. permitting authority determines § 51.165(a)(1)(v). States will then be free to adopt any whether a physical or operational One key attribute of the NSR program combination of these menu options into change will occur. If so, then the in general is that sources typically ‘‘net’’ their own regulations and SIP to offer permitting authority proceeds in the modifications out of review by coupling sources these alternatives. For instance, second step to determine whether the proposed emissions increases at the if EPA adopts in its final rulemaking physical or operational change will source with contemporaneous emissions both the ‘‘Clean Unit’’ exclusion and the result in an emissions increase over reductions. The judicial decision in PAL option, a State could retain its baseline levels. Alabama Power Co. v. Costle, 636 F.2d current federally-approved applicability The reference to ‘‘any physical change 323, 400–403 (D.C. Cir. 1979), endorsed approach without making changes, ** * or change in the method of use of this ‘‘plantwide bubble’’ concept retain its existing approach and add a operation’’ in section 111(a)(4) of the in the PSD program. The court reasoned Clean Unit Test, or retain its existing Act could—read literally—encompass that since the principal purpose of the approach and add both a Clean Unit the most mundane activities at an PSD program was to prevent Test and an option for PAL. The EPA industrial facility (even the repair or deterioration in air quality, a PSD also proposes to include these replacement of a single leaky pipe, or an permit was unnecessary so long as new applicability approaches in the part 52 insignificant change in the way that construction at an existing plant did not regulations governing Federal pipe is utilized). However, the EPA has increase overall emissions to the permitting programs. The EPA solicits recognized that Congress did not intend environment. Thus, under the EPA regulations promulgated in 1980 comment on this approach and to make every activity at a source following Alabama Power (which are for specifically solicits comments on what subject to major new source the most part still in place today), restrictions, if any, EPA should place on requirements under parts C and D. As a source owners may modify or even States in selecting applicability options. result, the EPA has adopted several exclusions from the ‘‘physical or completely replace or add emissions B. Background operational change’’ component of the units without obtaining a PSD permit so long as ‘‘actual emissions’’ do not 1. Current Provisions definition. For instance, the EPA has specifically recognized that routine increase over baseline levels at the plant The major NSR provisions of part C as a whole. In 1984, the EPA regulations (PSD) and part D (nonattainment 3 The ‘‘PTE’’ is currently defined as the expanding the use of the plantwide requirements) of title I of the Act apply ‘‘maximum capacity of a stationary source to emit bubble to the nonattainment area NSR to both the construction of new major a pollutant under its physical and operational program under title I, part D of the Act sources and the modification of existing design.’’ Any physical or operational limitation on were upheld in Chevron, U.S.A., Inc. v. major sources. For new ‘‘greenfield’’ the capacity of the source to emit a pollutant, including a permit limitation, is treated as part of NRDC, 467 U.S. 837 (1984). sources, ‘‘applicability’’—the its design provided the limitation or its effect on Applicability of the part C and D NSR determination of whether an activity is emissions is federally enforceable (e.g., see existing provisions must be determined in subject to the program or, stated §§ 51.165(a)(1)(iii) and 51.166(b)(4)). advance of construction and is differently, whether the program applies In recent decisions, National Mining Ass’n v. pollutant-specific. In cases involving EPA, 59 F.3d 1351 (D.C. Cir. 1995) and Chemical to particular circumstances—is a fairly Manufacturers Ass’n v. EPA, No. 89–1514, slip op. existing sources, this requires a straightforward determination. The Act, (D.C. Cir. Sept. 15, 1995), the District of Columbia pollutant-by-pollutant determination of as implemented by the EPA’s Circuit court addressed challenges related to EPA’s the emissions change, if any, that will regulations, sets applicability thresholds requirement that a source which wishes to limit its result from the physical or operational PTE must obtain a federally enforceable limit. The for nonattainment areas (PTE above 100 EPA is currently reviewing its Federal change. The EPA’s 1980 regulations tons per year (tpy) of any pollutant enforceability requirements in light of these court implementing the PSD and subject to regulation under the Act, or decisions, and has not yet decided how it will nonattainment NSR programs thus smaller amounts, depending on the address this issue. Once EPA has completed its inquire whether the proposed change review of the Federal enforceability requirements in nonattainment classification) and all relevant programs including NSR, the Agency constitutes a ‘‘major modification,’’ i.e., attainment areas (100 or 250 tpy, will make available in a Federal Register notice its a nonexcluded physical change or depending on the source type). A new response to the court decisions. change in the method of operation ‘‘that 38254 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules would result in a significant net The current regulations provide that representatives argue that under current emissions increase of any pollutant when an emissions unit (other than an regulations the EPA cannot properly subject to regulation under the Act.’’ See electric utility steam generating unit) presume that every non-routine or existing § 52.21(b)(2)(i). A ‘‘net ‘‘has not begun normal operations,’’ otherwise nonexcluded change to an emissions increase’’ is defined as the actual emissions equal the PTE of the existing emissions unit cannot be the increase in ‘‘actual emissions’’ from the unit. See existing § 52.21(b)(21)(iv). The basis for finding that the unit ‘‘has not particular physical or operational EPA has interpreted this provision as begun normal operations.’’ They change (taking into account the use of creating an initial presumption that contend that the fact that a unit is emissions control technology and because the changed unit ‘‘has not proposed to be ‘‘changed’’ should not restrictions on hours of operation or begun normal operations’’ following the necessarily mean that it has not yet rates of production where such controls change, it will operate at its full ‘‘begun normal operations’’ following and restrictions are federally capacity year round, i.e., at its full the change. enforceable), together with other emissions potential. This is referred to Two cases have addressed the EPA’s contemporaneous increases or decreases as the ‘‘actual-to-potential’’ test. The application of the actual-to-potential in actual emissions at the source. See owner or operator is free to rebut the test, and specifically, the interpretation footnote 3 and existing § 52.21(b)(3)(i).4 presumption that actual emissions will of the phrase ‘‘begun normal In order to trigger major NSR, the net increase over pre-modification levels by operations.’’ In Puerto Rican Cement Co. emissions increase must exceed agreeing to limit its PTE, through the v. EPA, 889 F.2d 292 (1st Cir. 1989), the specified ‘‘significance’’ levels when use of federally enforceable restrictions, court upheld the EPA’s application of compared to a pre-modification to pre-modification actual emissions the actual-to-potential methodology in a ‘‘baseline.’’ 5 See existing levels (plus an amount that is less than case involving conversion of a cement §§ 52.21(b)(2)(i) and 52.21(b)(23). ‘‘significant’’). See footnote 3. The effect plant from a wet process to a more The EPA’s existing regulations of this methodology is to require the efficient dry process. The court upheld generally define baseline actual source to take minor NSR permit limits the EPA’s interpretation that the words emissions as ‘‘the average rate, in tpy, at to ensure that actual emissions will not ‘‘emissions unit that has not begun which the unit actually emitted the increase (by more than a prescribed normal operations’’ include modified pollutant during a 2-year period which ‘‘significant’’ amount, if any) above units as well as new units, citing a precedes the particular date and which baseline levels following the physical or passage from the 1980 rulemaking is representative of normal source operational change. preamble that, in the court’s view, made it clear that the EPA intended to apply operation’’ (see, e.g., existing 2. Litigation Over the Actual-to- the actual-to-potential test to a ‘‘new or § 52.21(b)(21)(ii)). The Administrator Potential Test modified unit.’’ 889 F.2d at 298 (45 FR ‘‘shall’’ allow use of a different time Industry has long been concerned that 52676, 52677) (emphasis added by period ‘‘upon a determination that it is most physical or operational changes court). more representative of normal source under EPA’s rules will initially register The court noted that its endorsement operation.’’ Id. The EPA has historically as emissions increases under EPA’s of EPA’s use of the ‘‘actual-to-potential’’ used the 2 years immediately preceding actual-to-potential test because most approach for calculating an emission the proposed change to establish the sources are operated at less than full change in this case was simplified by baseline [see 45 FR 52676, 52705, capacity on an annual basis. As a result, the facts presented, and that under other 52718]. However, in some cases it has a change at the source that does not circumstances, the decision could have allowed use of an earlier period. affect instantaneous emissions rates been more difficult. With respect to modifications at shows up as a presumed emissions On a related issue, the court agreed existing sources, a prediction of whether increase because the pre-modification with the EPA’s position that the the physical or operational change will actual utilization is less than the regulatory exclusion for certain result in a significant net increase in the projected post-modification utilization, increases in a source’s production rate source’s actual emissions following the which is presumed to reflect full or hours of operation applies only when modification is thus necessary. In part capacity at all times. Hence, often such an increase is unaccompanied by this involves a straightforward and sources have accept federally construction or modification activity. readily predictable engineering enforceable limits on post-modification See id. at 916, n.11. The EPA is today judgment—how will the change affect emissions or operations to avoid major proposing to make the existing the emissions factor or emissions rate of NSR.6 As a legal matter, some industry exclusion explicitly clear on this point the emissions units that are to be by inserting the phrase ‘‘standing alone’’ changed. It also necessarily involves a 6 For example, consider an industrial coal-fired at the beginning of the exclusion. See prediction of utilization rates—how boiler, constructed in the late 1960s and therefore proposed amendatory language for much of the source’s full production ‘‘grandfathered’’ from NSR, which originally had a §§ 51.165(a)(1)(v)(C)(6), PTE of 1000 tons per year of SO2. Since the mid- capabilities as modified will be used per 1980s, this source has actually operated at 50 51.166(b)(2)(iii)(F), 52.21(b)(2)(iii)(F) hour, and how many hours per year the percent of its capacity and emitted only 500 tons and 52.24(f). source will be operated. per year due to economic conditions or because the The actual-to-potential test was also at boiler became less efficient as it aged, and hence less economic to operate at full capacity. If the the heart of a legal challenge brought by 4 In approximate terms, ‘‘contemporaneous’’ boiler were to be modified through a non-routine WEPCO, see Wisconsin Electric Power emissions increases or decreases are those which physical change which did not affect the unit’s Co. v. Reilly, 893 F.2d 901 (7th Cir. have occurred between the date 5 years preceding hourly emissions rate, the owner or operator would 1990). The WEPCO proposed extensive, the proposed physical or operational change and need either to accept a cap on its post-modification the date that the increase from the change occurs emissions at 539 tons per year (i.e., a level less than life-extension renovations for several [see, e.g., existing section 52.21(b)(3)(ii)]. a significant increase over its past actual emissions, older (35- to 50-year old) coal-fired 5 Once a modification is determined to be major, where the significant increase level for SO2 is 40 electric utility boilers. The EPA sought the PSD requirements apply only to those specific tons per year), or to obtain a major NSR permit if to apply the ‘‘actual-to-potential’’ test pollutants for which there would be a significant it desires to maintain the ability to operate at 100 net emissions increase. See, e.g., existing sections percent of its rated capacity. The 500 ton ‘‘cushion’’ reasoning that the modernizing changes, 52.21(j)(3) (BACT) and 52.21(m)(1)(b) (air quality between actual and potential emissions that existed as confirmed by the WEPCO’s own analysis). prior to the modification would no longer exist. projections, would increase reliability Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38255 and decrease operating costs, thus likely annual actual emissions from any 2 focused on units which have not leading to increased utilization and, consecutive years within the prior 5 recently been required to meet a control hence, increased actual emissions. years. This presumption would be technology requirement, NSR can be However, the Seventh Circuit disagreed superseded by the proposed baseline expected to result in more effective with the EPA’s interpretation. The court changes for all source categories controls and meaningful reductions in coined the phrase ‘‘like-kind discussed in section II.D. of this actual emissions. replacement’’ to describe the type of preamble. In the WEPCO rule, the EPA Similarly, where an entire facility renovations occurring at the WEPCO also created a pollution control project already meets the goal of the application plant, where steam drums and other exclusion for utilities. As discussed in of state-of-the-art controls and has major components were replaced by section II.E. of this preamble, today’s undergone an air quality impact new components of identical design and proposal would replace this pollution analysis of its emissions, environmental function. 893 F.2d at 917. The court said control project exclusion with a new concerns associated with proposed that where the renovations were like- pollution control project exclusion for changes are likely reduced if the kind replacements, the EPA could not all source categories.8 changes remain consistent with reasonably interpret its regulations to requirements imposed by the original C. The ‘‘Clean Unit’’ and ‘‘Clean say that such a unit was so different that analysis. Thus, EPA is also proposing a Facility’’ Exclusion it has not begun normal operations. ‘‘clean’’ facility exclusion that allows a Following the remand in the WEPCO 1. Introduction major stationary source to make changes at its facility consistent with PSD or case, the EPA employed an ‘‘actual-to- The Applicability Subgroup of the future-actual’’ test for the WEPCO NSR permits that have been recently CAAAC’s NSR Reform Subcommittee issued. facility comparing WEPCO’s emissions considered many applicability options. during the baseline period to estimated While none of these proposals garnered 2. Description of the Clean Unit future-actual emissions drawn from the full Subcommittee’s support, Proposal utilization projections available in the representatives of State and local record. Based on these factors, the EPA is regulators as well as environmental today proposing a simplified 3. The WEPCO Rulemaking groups expressed general support for the applicability test for changes to existing In 1992, the EPA promulgated idea that ‘‘benign’’ changes at existing emissions units that already are well- revisions to its applicability regulations emissions units should not be subject to controlled considering the extent a creating special rules for physical and the complicated NSR applicability rules current BACT/LAER review for a operational changes at electric utility related to determining a significant net particular unit would result in lower steam generating units [see 57 FR 32314, emissions increase. There was also emissions. In general, this new ‘‘clean July 21, 1992].7 In this rule, prompted support for the proposition that the NSR unit’’ exclusion will allow States to by the WEPCO litigation and commonly applicability test should provide some exclude from major NSR, proposed referred to as the ‘‘WEPCO Rule,’’ the deference to sources that have already changes to existing emissions units that EPA adopted an actual-to-future-actual undergone major NSR. have installed major BACT or LAER The EPA, after careful consideration methodology for all changes at electric within the last 10 years or which of these discussions, believes that the utility steam generating units except the otherwise qualify as a ‘‘clean unit.’’ best approach for a new exclusion is one construction of a new electric generating Under this exclusion, sources can make that focuses on the existing emissions unit or the replacement or any change to a qualifying unit so long control of a unit, rather than the change reconstruction of an existing emissions as the change will not increase the being proposed. Almost all stakeholders unit. Under this methodology, a utility unit’s emissions rate (measured in terms identified the goal of ensuring that compares its actual annual emissions of the unit’s maximum hourly modified units apply state-of-the-art before the change with its projected emissions, the NSPS test found at 40 controls as being of paramount annual emissions after the change to CFR 60.14). Specifically, changes which importance. Accordingly, where an determine if a physical or operational do not increase the unit’s hourly emissions unit already meets this goal, change would result in a significant potential emissions would not be environmental concerns associated with increase in emissions. To ensure that considered a physical or operational proposed changes are likely reduced. the projection is valid, the rule requires change and thus would not trigger major For example, it is the EPA’s experience 9 the source to track its emissions for the NSR. See proposed that in many cases where an existing next 5 years. The EPA is today well-controlled unit triggers major NSR, 9 proposing to allow use of this Under today’s proposal, for units that are the permitting process does not permitted to change feedstocks frequently, such as methodology for all source categories as necessarily result in improved controls. pharmaceutical manufacturing and certain chemical described in more detail in section II.G On the other hand, where the review is batch processes, the maximum hourly emissions of this preamble. rate test would be applied on a per feedstock basis The EPA also made changes to the to determine if an emission increase will occur. For 8 In the WEPCO Rule, the EPA also created example, a unit which has state-of-the-art volatile baseline portion of the actual-to-future- special new source performance standard (NSPS) organic compounds (VOC) control technology and actual methodology. The EPA retained treatment for certain repowering projects and uses toluene and other organic solvents as the existing regulatory language, but provided limited NSR exemptions for temporary feedstocks, the hourly maximum emission rate of adopted a presumption that utilities and permanent Clean Coal Technology projects, and toluene before and after the proposed physical or for certain ‘‘very clean’’ units. See e.g., existing operational change would be assessed as if toluene may use as baseline emissions the section 51.166(b)(2)(iii) (i), (j) and (k)]. All of these alone was to be fully utilized by the unit before and changes implemented special provisions in the after the proposed change. The other feedstocks 7 The regulations define ‘‘electric utility steam 1990 Amendments. In the rule, the EPA also would also be individually assessed. A change in generating units’’ as any steam electric generating amended its NSPS regulations (40 CFR part 60) to feedstock would not trigger NSR if the control unit that is constructed for the purpose of supplying allow a utility to use as its pre-change baseline its technology designed to control emissions resulting more than one-third of its potential electric output highest hourly emissions rate achieved during the from the feedstock and the unit was previously capacity and more than 25 megawatts (MW) of 5 years prior to the proposed physical or permitted to use the feedstock. The EPA encourages electrical output to any utility power distribution operational change. The changes implementing the suggestions in developing rules or guidance on system for sale. See e.g., existing section NSPS baseline change are neither discussed nor other approaches for determining emissions 51.166(b)(30). affected by today’s rulemaking proposal. Continued 38256 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

§§ 51.165(a)(1)(v)(C)(10), through (13), 51.166(b)(2)(iii)(L), technology (MACT) or reasonably 51.166(b)(2)(iii)(L), 52.21(b)(2)(iii)(L), 52.21(b)(2)(iii)(L), and 52.24(f). The EPA available control technology (RACT) and 52.24(f). envisions that three types of limits should also automatically qualify as The proposed ‘‘clean unit’’ exclusion would qualify: (1) BACT or LAER limits clean units. A recently required MACT would both simplify the applicability set within the last 10 years for the emissions limit, while not necessarily test for qualifying units and increase particular unit; (2) a limit set within the equal to BACT or LAER, is likely to source flexibility. It would also reward last 10 years for the particular unit by result in significant emissions controls sources that in the recent past have a State technology review program such that a BACT or LAER review applied controls to their emissions units determined by EPA to be comparable to would not necessarily result in that were equal or comparable to BACT the Federal BACT or LAER programs; significant additional emissions or LAER. and (3) a limit found on a case-by-case reductions. However, the EPA is also Ideally, the change in hourly potential basis—after notice and opportunity for concerned that a MACT limit could be emissions would be assessed public comment—to be comparable to significantly less effective in limiting immediately before and after the change the current BACT or LAER limits that VOC emissions than BACT or LAER in to determine if an emissions increase would otherwise be imposed on the many circumstances. A MACT emission did indeed occur. However, this may source after weighing the cost and limit may adequately control a toxic not be practical in many instances benefits of additional or modified VOC but could result in emission because information necessary to controls, including retrofit cost and increases of pollutants subject to NSR. establish the hourly potential emissions benefits. For example, an incinerator installed to rate may require considerable time to a. Units with BACT or LAER Limits. reduce a toxic VOC will increase develop or collect. Therefore, under the One starting point for determining nitrogen oxides (NOX) emissions proposed provision, the pre-change whether a unit is well-controlled is the emitted to the atmosphere. hourly potential emission rate may be level of control required to satisfy BACT The EPA also has concerns with using established or verified at any time up to (in attainment/unclassified areas) or Federal RACT limits to presumptively 6 months prior to the proposed activity LAER (in nonattainment areas). For qualify a unit as a clean unit since or project. The EPA solicits comment on units which have recently undergone RACT emission limits can be less alternative periods for establishing the these reviews, re-evaluation of the stringent than LAER and BACT. Further, pre-change hourly emissions rate, technology shortly after the source is in some instances RACT is based on the particularly periods which might allow constructed or modified to determine if attainment needs of the area and not a the use of routine compliance emissions the technology is still ‘‘state-of-the-art’’ specific control technology standard. tests to determine the emissions rate would likely result in very little or no While EPA solicits comment on (e.g., annual). Also, under the proposed incremental improvement in emissions presumptively applying the clean unit provision, where the unit is subject to control. Moreover, units that are exclusion test to units with Federal a federally enforceable limitation (on recently permitted are far less likely to MACT or RACT limits, the EPA is not operations or emissions) which limits have physically deteriorated and more inclined to do so across the board. the unit’s hourly potential emissions to likely to be running near permitted Rather, the EPA believes that MACT or less than the maximum physically- capacity, reducing the risk that changes RACT limits should be found to qualify achievable hourly rate, the unit’s lower to the unit will result in increased for the Clean Unit exclusion using the allowable rate must be used in utilization and increased actual case-by-case option described in section determining if an emissions increase emissions. II.C.3.c. will occur at the unit. Therefore, the EPA is proposing that b. State Technology Programs the new exclusion may presumptively Comparable to BACT or LAER.There are 3. What Constitutes a ‘‘Clean Unit’’? apply to any unit which received a many emissions units at stationary For this exclusion to function, it is BACT or LAER limit in a currently sources that were permitted according necessary to distinguish a well- applicable major NSR permit within 10 to a State’s minor NSR permitting controlled unit from a poorly controlled years of the proposed change under program. While these units were not one. In other words, what criteria consideration. See proposed subject to a major source BACT or LAER distinguish a unit eligible for this §§ 51.165(a)(1)(v)(C)(11)(i), limit per se, they may have installed exclusion from one which is not? 51.166(b)(2)(iii)(L)(2)(i), controls that would have satisfied major Criteria which allow a broad range of 52.21(b)(2)(iii)(L)(2)(i), and 52.24(f). In source BACT or LAER requirements at units to qualify could largely transform other words, for the first 10 years the time the permit was issued. For the existing applicability system into following issuance of a PSD or instance, several jurisdictions have one based solely on assessing a unit’s nonattainment NSR permit, units control technology reviews as part of a potential emissions, with the possibility subject to BACT or LAER set in that State, local or tribal minor NSR program of a dramatic increase in a unit’s actual permit are eligible for the clean unit which requires new or modifying annual emissions without undergoing exclusion. At least some members of the sources to meet emissions levels NSR. Subcommittee expressed concern that comparable to major source control The EPA proposes to require that in the 10-year period is too long given the technology requirements (BACT or order to qualify as a ‘‘clean unit’’ an improvement in control technology that LAER). For this reason, the EPA is emissions unit must have a federally can occur in some source categories. For proposing that permitting authorities enforceable emissions limit that ‘‘is this reason, EPA solicits comment on may submit minor NSR control comparable’’ to the BACT or LAER using a shorter period such as 5 years technology requirements for requirements for that type of unit, as the length of the Clean Unit certification by the EPA that the minor whichever would otherwise be presumption derived from a NSR NSR program requires control applicable to the proposed change. See permit. technology that would satisfy the proposed §§ 51.165(a)(1)(v)(C) (10) During consideration of the Clean requirements for the clean unit Unit Exclusion, several participants exclusion. See proposed increases for processes with rapidly changing and suggested that units subject to §§ 51.165(a)(1)(v)(C)(11)(ii), mixed feedstocks. maximum achievable control 51.166(b)(2)(iii)(L)(2)(ii), Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38257

52.21(b)(2)(iii)(L)(2)(ii), and 52.24(f). as a ‘‘clean unit’’ if, in the informed comment on other approaches for Once determined by EPA to be judgment of the permitting agency, a qualifying units. comparable, all units subject to current BACT or LAER determination States are encouraged to use the emissions limitation established under for the unit would not be expected to permitting process required by title V of the jurisdiction’s minor NSR program result in any lower level of emissions the Act as the vehicle for determining would be eligible for the clean unit from the unit for the pollutant in and recording which units at a title V exclusion for the first 10 years following question. The costs, benefits and source can qualify for this exclusion.11 issuance of the permit. This could also technical consideration associated with The permitting authority could use the apply to permits that have been issued the retrofit application of additional title V permit issuance, revision or previously under minor NSR technology controls to the particular unit may be renewal process as the mechanism for requirements that are later determined considered by the permitting agency in making the case-by-case determination to be comparable to major source BACT the evaluation. Since this in effect may (so long as the opportunity for public or LAER requirements. In such a case, require the permitting authority to comment is provided). For convenience, the clean unit exclusion would apply to engage in a technology review that is one, many or all units at a source could the unit covered by the minor NSR similar to BACT or LAER review in be reviewed and subjected to public permit, and it would take effect once order to qualify a unit for this exclusion, notice and comment concurrently with EPA makes the certification of the EPA is asking for comment on other the issuance or renewal of a title V comparability (i.e., the clean unit test approaches for qualifying units. operating permit. For units eligible for would apply only to modifications Once a permitting authority makes the ‘‘clean unit’’ exclusion due to a prior taking place after the EPA certification this determination through a process NSR BACT or LAER determination, or a of comparability). The clean unit test involving notice and opportunity for determination under a program found could apply to the qualifying unit for up public comment, the unit would be comparable by EPA, the title V permit to 10 years after issuance of the minor eligible for the clean unit exclusion for offers the opportunity to clearly set forth source permit. The EPA also solicits the next 5 years. As with the other types the status of the unit under the clean comment on whether a shorter period, of proposed clean unit exclusions, EPA unit exclusion. Qualifying clean units such as 5 years, would be more requests public comments on the and the pollutant for which the appropriate. proposed exclusion eligibility period. determination was made should be The EPA also solicits comment on the See proposed clearly identified and listed in the title appropriate standards for EPA to use in §§ 51.165(a)(1)(v)(C)(11)(iii), V permit as ‘‘clean units’’ for NSR determining whether a permitting 51.166(b)(2)(iii)(L)(2)(iii), purposes. authority’s minor NSR program control 52.21(b)(2)(iii)(L)(2)(iii), and 52.24(f). Under this proposal, a unit that does technology requirements are comparable The EPA solicits comments on several not initially qualify for the clean unit to the BACT and LAER requirements. other alternative bases upon which a exclusion could install controls meeting The EPA envisions that as a minimum permitting authority could take to make the criteria the EPA establishes for well- a ‘‘pre-certified’’ minor NSR program controlled units and thereby qualify to comply with 40 CFR 51.160 through the determination that a unit has a comparable BACT or LAER emissions use the exclusion. The controls or 164.10 pollution reduction strategy that are the c. Qualification of Units on a Case-By- limitation. The first would be based on an average of BACT or LAER for basis for the clean unit determination Case Basis. In many cases an emissions must be in place and federally unit not subject to major NSR is equivalent or similar sources over a recent period of time (e.g., most recent enforceable at the time the source relies constructed or retrofitted with a control on an exclusion under this provision. So technology or strategy comparable to the 3 years). The second would be based on the unit’s control level being within long as these federally enforceable best controls applied in practice. This conditions are met, the source is free to may occur when a source minimizes some percentage (e.g., 5 or 10 percent) of the most recent, or average of the make any change at the permitted unit emissions in order to ‘‘net’’ a unit out including those which could affect a of major NSR or applies controls to most recent, BACT or LAER levels for equivalent or similar sources. The EPA unit’s efficiency, capacity, availability, comply with other provisions of the Act. longevity and utilization. However, For this reason, the EPA’s proposed solicits comment on these approaches changes which would compromise the regulations would allow a source having and on the general issues concerning original emissions unit’s BACT or LAER a limit on an emissions unit determined whether and how EPA should impose a control level or air quality impact (e.g., to be comparable to BACT or LAER for specific methodology for determining modified stack parameters which would the particular unit considering cost and that a specific emissions limit is cause or contribute to violation of any benefits of additional or modified ‘‘comparable’’ to the BACT or LAER applicable ambient standard, controls, including retrofit cost and limit that would result from a major replacement of the unit with a different benefits to qualify for the ‘‘clean unit’’ source review. type or size of unit, or reconstruction of exclusion on a case-by-case basis. For all of the above tests, the EPA the unit) would not be allowed. Also, Specifically, an existing unit which has realizes that there are many source and not undergone a BACT or LAER emission unit categories for which 11 While rules implementing title V address how determination or comparable State BACT or LAER determinations do not the unit’s major NSR permit and BACT or LAER technology requirement can also qualify exist, let alone recent determinations. limit are incorporated into the title V permit, it is For these sources, the EPA proposes that not clear that the status of a unit as a NSR clean 10 In a separate rulemaking EPA has proposed their level of control be gauged against unit would be included in the title V permit as an revising the public review and comment the control level associated with BACT applicable requirement. Whether the status of a unit requirements at 40 CFR 51.161 to give States more as a NSR clean unit presumption is an applicable flexibility in processing minor source permits for or LAER for emission units with similar requirement in the title V permit will likely depend projects that are determined to be ‘‘less emission stream characteristics. Since upon how the clean unit test is adopted by the environmentally significant.’’ Certain minor source this in effect requires the permitting permitting authority (e.g., adopted as a SIP actions, e.g., netting, that in effect shield a source authority to engage in a BACT or LAER requirement). The EPA solicits comment on the best from major source permitting requirements would approach for implementing and coordinating the not qualify for less environmentally significant review in order to qualify a unit for this review and designation of clean units with the title status. See 60 FR 45529, 45549 (August 31, 1995). exclusion, the EPA is asking for V permit process. 38258 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules for units excluded from major NSR However, all other changes consistent excluded changes to a portion of the under this proposed revision, the with the terms of the major NSR permit plant. physical or operational change must would not be considered a ‘‘physical or Provisions in the existing regulations still comply with all otherwise operational change’’ for the purposes of which, at the discretion of the applicable Act and SIP requirements major NSR applicability. Similarly, permitting authority, allow the use a including any federally enforceable emissions trades may not be permissible different, ‘‘more representative,’’ period limits on emissions or operations and where a different air quality impact have not alleviated the problem in the minor NSR requirements. would result since the PSD or NSR view of many Subcommittee members. Finally, the determination that a unit permit might limit such differing As with other aspects of current netting is ‘‘clean’’ or ‘‘well-controlled’’ under impacts. rules, establishing representative this proposal is an applicability test and As proposed, a clean major stationary baseline periods other than the 2-year is independent from the case-by-case source is one that underwent NSR period preceding the proposed change determination of BACT or LAER for within the last 10 years. The EPA can be complex and time-consuming, sources subject to major NSR. While requests comment on this approach and and often involves disputed judgment control technology which qualifies a specifically on whether this proposed calls. unit as ‘‘clean’’ may be ‘‘comparable’’ to approach should not allow units or Several industry applicability BACT or LAER for a particular unit facilities to be replaced or proposals included changing to a considering its unique circumstances, it reconstructed. netting baseline that allows sources to is not necessarily equal to BACT or use the highest year or 12 consecutive D. Revision to the Netting Baseline LAER for that unit when considered as months out of the previous 10 years. part of a new major facility or major This preamble describes and solicits Generally, the participating State air modification, and in no way establishes comment on a new method for pollution management officials favored a presumptive BACT or LAER for that determining an existing source’s this increase in flexibility. Some of the unit, source type or category. Further, a baseline emissions for purposes of environmental group representatives 5- or 10-year presumption that a unit is determining whether a physical or also recognized that the existing ‘‘clean’’ does not in any way ‘‘freeze’’ operational change will cause an baseline approach has the impact of BACT or LAER determinations in increase in emissions and trigger NSR. taking away ‘‘used and useful’’ capacity permitting actions. The Act requires that 1. Introduction and that a longer baseline period would BACT and LAER be current be appropriate. On the other hand, some determinations for sources subject to As discussed, in order to determine participants were concerned that the major NSR and the clean unit whether a physical or operational test for determining a net emissions designation does not override this change will result in an increase in increase take into account not only determination. emissions, it is necessary to compare a annual emissions levels but short-term source’s emissions before the change (its levels as well. The proposal outlined 4. Description of the Clean Facility baseline emissions) with its emissions below addresses these concerns. Proposal after the change. The EPA’s existing Similar to the clean unit exclusion, regulations generally define baseline 2. Description of Proposed Netting EPA is proposing an exclusion for actual emissions as ‘‘the average rate, in Baseline changes at clean facilities. This ‘‘clean tpy, at which the unit actually emitted The EPA is today proposing to extend facility’’ exclusion will allow States to the pollutant during a 2-year period the time period for determining baseline exclude from major NSR, proposed which precedes the particular date and in the definition of actual emissions to changes to an existing major stationary which is representative of normal 10 years for all source categories and to source that has undergone major NSR source operation.’’ See, e.g., existing allow sources to base their actual for the entire source within the last 10 § 52.21(b)(21)(ii). The Administrator emissions on the highest consecutive 12 years. See proposed ‘‘shall’’ allow use of a different time months during this 10-year period. See §§ 51.165(a)(1)(v)(C)(11), period ‘‘upon a determination that it is proposed §§ 51.165(a)(1)(xii)(b), 51.166(b)(2)(iii)(M), 52.21(b)(2)(iii)(M), more representative of normal source 51.166(b)(21)(ii) and 52.21(b)(21)(ii). As and 52.24(f). Under this exclusion, a operation.’’ Id. Prior to the WEPCO rule, described below, in nonattainment areas major source can make any change as EPA historically used the 2 years and ozone transport regions, the EPA long as the source would still be in immediately preceding the proposed proposes that the 12-month period begin compliance with its major NSR permit. change to establish the baseline. (See 57 on or after November 15, 1990 to be The EPA envisions this to allow any FR 32323.) However, in the WEPCO consistent with the area’s emissions changes that do not include adding new rule, EPA adopted a ‘‘presumption’’ that inventory and attainment plan units or allowing emissions trades that utility sources could use any 2-year requirements. See proposed § 51.165 were not evaluated for air quality period out of the preceding 5 years. (a)(1)(xii)(B). In addition, this proposal impacts in the major NSR permit. The During the CAAAC Subcommittee would replace the any 2-years-in-5 exclusion would, however, allow a deliberations, there was considerable baseline established as a presumption source to replace or reconstruct existing interest in the issue of the proper for utilities in the WEPCO rulemaking units so long as they continue to meet baseline. For instance in the automobile and would be available for all source the emissions limitations established in industry, where low utilization rates categories, subject to the restrictions the permit. Thus, such replacement or have persisted at some plants for several discussed below. See, e.g., existing reconstruction would not result in a years, EPA’s baseline presumptions § 51.166(b)(21)(v). different type of emissions unit than have the effect of leaving plant The EPA’s intent is to allow sources envisioned and covered by the major managers with the choice of to determine applicability based on NSR permit and its requirements. The surrendering capacity (that would not their highest level of utilization and not addition of new emissions units would be considered representative of normal necessarily their highest emissions rate. not be allowed under the proposal operations under the current NSR rules) The emissions rate of units at issue may because such changes would not be or taking the time and expense to secure be subject to any number of current consistent with the existing NSR permit. a major NSR permit for even small, non- Federal or State restrictions (e.g., RACT, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38259

MACT, BACT, LAER, NSPS, national attainment/unclassifiable areas and operation or unit to be subject to major emission standard for HAP (NESHAP)) nonattainment areas. NSR. While the determination of the as well as voluntary limits (e.g., It is the EPA’s experience that many emissions baseline is somewhat reductions used for netting, offsets, sources keep accurate records on independent of the actual netting Emission Reduction Credits creation) emissions or operations for only 3 to 5 calculation, clearly the proposed new and these limits may have been imposed years, unless expressly required to do so baseline can affect netting transactions since the time the source achieved its for a longer period. A number of State and may be in tension with the design highest emissions level. Therefore, these and local permitting authorities have and intent of these statutory provisions. limits must be included in establishing similar experiences. Thus, the EPA has This proposal does not extend the the baseline emissions. For this reason, reservations concerning the use of 10- current 5-year contemporaneous period the EPA is today proposing that sources year, and longer, baselines and solicits for considering increases and decreases calculate the baseline by using their comment on whether a shorter (e.g., 5- for netting. See, e.g., existing current emissions factor in combination year) period would be more appropriate. §§ 51.165(a)(1)(vi)(B), 51.166(b)(3)(ii), with the utilization level from the 12- In addition, if the EPA adopts a 10-year 52.21(b)(3)(ii), and 52.24(f)(6)(ii). While month time period selected. This look back period, the EPA also proposes this proposal would allow a 10-year safeguard insures that no significant loss that such period be available only when look back from the activity under review of environmental protection will result adequate emissions and/or capacity to determine baseline emissions, any from the proposed change. utilization data are available for the contemporaneous increases and Under the proposed provision, EPA baseline calculation. The EPA solicits decreases must occur within the 5-year also would limit the new baseline in comment on the need to condition the window to be applicable for netting. nonattainment areas and ozone use of such periods upon the accuracy The EPA solicits comment on the effect transport regions to no sooner than the and completeness of available data, and of the differing look back and enactment date of the 1990 the need to establish specific criteria, contemporaneous periods and any Amendments, November 15, 1990. The through guidance or otherwise, for reasons why these periods should be 1990 Amendments included a number accuracy, completeness and consistent, over either 5 or 10 years. of changes in how emissions are to be recordkeeping when using older data. As noted, the EPA’s existing 3. Protection of Short-term Increments inventoried and tracked, particularly in regulations provide that the source may and NAAQS nonattainment areas and ozone seek to use another time period outside In discussions of a longer baseline, transport regions. The changes the 2 preceding years upon a finding by environmental group representatives strengthen reasonable further progress the permitting authority that this other linked any change from the existing tracking requirements, offset limitations period is ‘‘more representative’’ of baseline with the adoption of safeguards and RACT requirements for normal source operations. See existing for short-term NAAQS and PSD nonattainment areas and establish §§ 51.165(a)(1)(xii)(B), 51.166(b)(21)(ii), increments.12 These representatives enhanced emissions inventory 52.21(b)(21)(ii), and 52.24(f)(13)(ii). This suggested that the current netting requirements for all areas. The EPA provision has been a source of analysis be changed to require a source believes that allowing baselines prior to confusion and uneven implementation. to go through major NSR when there is the 1990 Amendments may complicate The EPA therefore proposes to eliminate a net increase in short-term (e.g., hourly, and impede State and local efforts to this provision. In other words, if the daily, weekly or monthly, depending on track and reduce emissions from a 1990 EPA were to adopt a 10-year look back, the emission tracking capability of the emissions baseline which in many cases a source may simply choose the highest source) emissions when past actual may be lower than pre-1990 emission consecutive 12-month period of emissions are represented by the highest levels. Therefore, the EPA is proposing utilization within the 10 years prior to short-term emissions in the previous to limit use of an expanded baseline in a proposed physical or operational year. This step could provide assurances nonattainment areas and ozone change (but not before November 15, that peak emissions, which could cause transport regions to a period of time no 1990 in ozone transport regions and violations of short-term NAAQS, would earlier than November 15, 1990 and no nonattainment areas). Neither the not be allowed to increase without greater than 10 years, whichever is more permitting authority nor the EPA will major NSR. Some applicability restrictive. This means that sources in retain any discretion to allow a time subgroup members argued that the nonattainment areas would not be able period outside this extended range. short-term test should be an air quality to utilize a 10-year look back until The EPA also solicits comment on screening test rather than an NSR November 15, 2000. how this proposed extension of the applicability trigger. In attainment/unclassifiable areas, use emissions baseline for netting may The EPA carefully considered the of pre-1990 emission baselines would interact with the statutory requirements possibility of adding a short-term also pre-date general emission inventory in section 182 (c) and (e) of the Act ‘‘increase’’ test to the netting and reporting requirements of the 1990 applicable in serious, severe and calculation; however, ultimately Amendments which are expected to extreme ozone nonattainment areas. decided against this in the proposal for improve recordkeeping and inventory Section 182(c) (6), (7) and (8) of the Act two reasons. First, the EPA is concerned maintenance by State and local provides special rules for modifications that a test that relies on a source’s agencies. Unlike nonattainment areas at major sources in serious and severe highest short-term actual emissions and ozone transport regions, however, ozone nonattainment areas including an would be too easy to circumvent. For a these inventory and data requirements aggregation of all net increases in short time, sources can run at maximum are not directly linked to the PSD emissions from a source over 5 capacity so that the baseline short-term requirements. Therefore, the EPA sees consecutive calendar years. Section emissions would likely be nothing less no clear reason why the use of a 10 year 182(e)(2) of the Act governs than the source’s maximum potential look back should be limited to after applicability of NSR to modifications in emissions. November 15, 1990 in attainment/ extreme ozone nonattainment areas unclassifiable areas. However, EPA requiring any change that results in any 12 The PSD increments are explained in section solicits comment on this issue for both increase in emissions from a discrete IV.B.1. 38260 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Moreover, the EPA is not sure that deliberations, EPA issued policy The EPA encourages commenters to limiting the source to its highest past guidance which covered all other source address EPA’s proposed decision to short-term emissions level will categories and which excluded supersede the WEPCO pollution control necessarily provide any additional qualifying pollution control projects project exclusion with a single protection to NAAQS, increments or from major NSR.14 Today, EPA proposes exclusion applicable to all types of Class I AQRV. The current regulations to replace both the WEPCO exclusion sources. Specifically, EPA invites already restrict the creditability of some and the policy guidance with a single comment on two alternative approaches: decreases in emissions where the comprehensive regulatory exclusion for (1) In addition to today’s proposed overall netting transaction could all types of pollution control projects exclusion for all source categories, jeopardize air quality. In particular, a (including add-on controls, switches to retain the WEPCO pollution control provision in the definition of ‘‘net less-polluting fuels, and pollution project exclusion for utilities only or (2) emissions increase’’ allows credit for a prevention projects). The proposed in lieu of the comprehensive exclusion reduction only to the extent that it has exclusion is designed to minimize proposed today, extend the WEPCO approximately the same qualitative procedural delays while still ensuring pollution control project exclusion to all significance for public health and appropriate environmental protection source categories. welfare as the increase from the (i.e., that a project be allowed not cause 1. Background proposed change. See, existing or contribute to a violation of a NAAQS §§ 51.165(a)(1)(vi)(E)(4), or PSD increment and not adversely In the WEPCO rulemaking, the EPA 51.166(b)(3)(vi)(c), 52.21(b)(3)(vi)(c), impact on the AQRV of Class I areas). amended its PSD and nonattainment and 52.24(f)(6)(v)(d). In a June 28, 1989, While this proposal was modeled NSR regulations as they pertain to rulemaking (54 FR 27286) EPA clarified after the WEPCO exclusion, it contains utilities by adding ‘‘the addition, that aspect of the regulations to require several significant changes reflecting the replacement or use of a pollution that, despite the absence of a significant fact that the WEPCO exclusion was control project at an existing electric net increase in emissions, an applicant limited to a single source category and utility steam generating unit’’ to the list proposing to net out of review must covered only a small, finite set of of activities excluded from major NSR demonstrate that the proposed netting pollution control projects specific to applicability. See, e.g., existing transaction will not cause or contribute utility units. In contrast to the WEPCO § 51.166(b)(2)(iii)(h). Because the to an air quality violation before the exclusion, this proposal reflects the WEPCO rulemaking was directed only emissions reduction may be credited. more complex task of addressing a vast at the utility industry, the EPA limited To ensure that the change to a netting array of pollution control and pollution the types of projects eligible for the baseline based on the highest 12 prevention projects at a variety of exclusion to those types of controls consecutive months out of the last 120 sources facing numerous Federal, State typically associated with that industry, consecutive months does not adversely and local environmental requirements. namely add-on controls and fuel impact short- (or long-) term ambient Specifically, this proposal: switches to a less polluting fuel.16 standards, the EPA is proposing to • Provides a much broader definition The EPA built two safeguards into the clarify the regulations by requiring that, of ‘‘pollution control project’’ than that exclusion in the WEPCO rulemaking. to be creditable for netting purposes, an adopted in the WEPCO rule and First, a project that meets the definition emissions reduction must be sufficient includes, unlike the WEPCO rule, of pollution control project would to prevent the proposed increase from pollution prevention projects; nonetheless not qualify for the causing or contributing to a violation of • Deletes the requirement that add-on exclusion where the ‘‘reviewing any NAAQS or PSD increment and must controls and fuel switches be subject to authority determines that [the proposed not have an adverse impact on AQRV an ‘‘environmentally beneficial’’ test; project] renders the unit less (including visibility) of Class I areas.13 instead only pollution prevention environmentally beneficial.’’ See, e.g., See proposed §§ 51.165(a)(1)(vi)(E)(4), projects are subject to this additional existing § 51.165(a)(1)(v)(C)(8). This 51.166(b)(3)(vi)(C), 52.21(b)(3)(vi)(C) safeguard; provision is buttressed by a second • and 52.24(f). As discussed above, this Incorporates the safeguard that no safeguard that directs permitting requirement is inherent in the EPA’s project, whether an add-on control, a authorities to evaluate the air quality current regulations and, therefore, fuel switch, or pollution prevention, can impacts of a proposed pollution control should already be part of any netting result in an increase in actual emissions project that the reviewing authority analysis. that will cause or contribute to a believes could result in a significant net violation of a NAAQS or PSD increase in representative actual annual E. Pollution Control Project Exclusion increment, and extends the policy to emissions of a criteria pollutant (id.; see The 1990 Amendments are protection against adverse impacts of also 57 FR 32322), since under no stimulating a vast number of sources in AQRV in a Class I areas.15 circumstances can a pollution control the country to undertake pollution project cause or contribute to violation control and pollution prevention 14 July 1, 1994 memorandum from John Seitz, of a NAAQS, PSD increment, or projects during the next few years. As a Director, OAQPS, ‘‘Pollution Control Projects and visibility limitation.17 See, e.g., existing New Source Review (NSR) Applicability’’. § 51.165(a)(1)(v)(C)(8)(ii); 57 FR 32322. result, most stakeholders urged EPA to 15 The WEPCO rule refers specifically to clarify the applicability of major NSR ‘‘visibility limitation’’ rather than ‘‘air quality requirements to pollution control and related values.’’ However, EPA clearly stated in the any air quality assessment for a pollution control pollution prevention projects. The EPA preamble to the final rule that permitting agencies project should consider impacts on visibility and have the authority to ‘‘solicit the views of others in any other relevant AQRV for any Class I areas that has previously adopted a limited taking any other appropriate remedial steps deemed may be affected by the proposed project. exclusion for pollution control project necessary to protect Class I areas * * *. EPA 16 The definition also includes certain clean coal undertaken by utilities as part of the emphasizes that all environmental impacts, technology demonstration projects. See, e.g., 1992 WEPCO rulemaking. See 57 FR including those on Class I areas, can be considered existing section 51.166(b)(2)(iii)(i) and (j). Today’s * * *.’’ See 57 FR 32322. Further, the statutory proposal would not affect these applicability rules 32314. Based on the stakeholder provisions in section 165(d) of the Act plainly are for certain clean coal technology projects that were intended to protect against any adverse impact on codified in the WEPCO rulemaking. 13 The AQRV in Federal Class I areas are AQRV in such Class I lands (including visibility). 17 The WEPCO rule adds that when evaluating explained in section IV. Based on this statutory provision, EPA believes that impacts the permitting authority may use that part Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38261

Subsequent to issuance of the WEPCO scrubbers for particulate or other Accordingly, under this proposal rule, EPA’s July 1, 1994, policy pollutants; permitting authorities would be allowed guidance provided a limited pollution —Flue gas recirculation, low-NOX to consider excluding from major NSR control project exclusion for other burners, selective non-catalytic raw material substitutions, process source categories on a case-by-case reduction and selective catalytic changes and other pollution prevention basis. The July 1994 guidance will reduction for NOX; and strategies where the proposed changes remain in effect until the EPA takes —Regenerative thermal oxidizers, are determined to be environmentally final action on today’s proposal. catalytic oxidizers, condensers, beneficial as discussed below. See thermal incinerators, flares and proposed §§ 51.165(a)(1)(xxv)(A)(6), 2. Description of Proposed Exclusion of carbon absorbers for VOC and HAP. 51.166(b)(31)(i)(F), 52.21(b)(32)(i)(F), Pollution Control Projects Projects undertaken to accommodate and 52.24(f). The EPA proposes to adopt for all switching to a less-polluting fuel, such b. Safeguards. (1) General source categories a pollution control as natural gas when the source is Applicability. For the purpose of this project exclusion from the definition of burning coal, would also qualify for the proposed exclusion, a pollution control ‘‘physical or operational change’’ within proposed exclusion. In some instances, project is an activity or project at an the definition of major modification. See where the emissions unit’s capability existing emissions unit where the proposed §§ 51.165(a)(1)(v)(C)(8), would otherwise be impaired as a result primary purpose of such activity or 51.166(b)(2)(iii)(H), 52.21(b)(2)(iii)(H), of the fuel switch, this may involve project is the reduction of air pollutants and 52.24(f). This proposed exclusion certain necessary changes to the subject to regulation under the Act at the emissions unit. See proposed will shield these projects from being pollution generating equipment (e.g., §§ 51.165(a)(1)(xxv), 51.166(b)(31), considered ‘‘major modifications’’ and boiler) in order to maintain the normal 52.21(b)(31), and 52.24(f). The proposed subject to major NSR. As proposed, the operating capability of the unit at the exclusion would not be applicable to air exclusion encompasses add-on controls, time of the project. pollution controls and emissions switches to less polluting fuels and The EPA has also concluded that associated with the construction of a pollution prevention projects and is substitutions of less potent ODS for proposed new emissions unit. subject to one overarching safeguard more potent ODS is environmentally Consistent with the WEPCO rule and first applied in WEPCO: that the beneficial and is therefore proposing EPA’s existing policy guidance the proposed pollution control project that such substitutions be considered a cannot result in an emissions increase replacement of an existing emissions pollution control project for PSD unit with a newer or different one that will cause or contribute to a purposes. See proposed violation of a NAAQS or PSD (albeit more efficient and less polluting) §§ 51.166(b)(2)(iii)(N) and 40 CFR or the reconstruction of an existing increment. See 57 FR 32322. As 52.21(b)(2)(iii)(N). This proposed discussed, while the WEPCO emissions unit would not qualify as a exclusion is described further in section pollution control project. Similarly, the rulemaking also extended this VI.B.2. of this preamble. prohibition to ‘‘visibility limitations,’’ fabrication, manufacture or production (2) Pollution Prevention Projects. The of pollution control/prevention EPA is proposing instead to focus the EPA’s policy is to promote pollution protection on AQRV (including equipment and inherently less-polluting prevention approaches and to remove fuels or raw materials would not qualify visibility) in Class I areas. In addition, regulatory barriers to sources seeking to for pollution prevention projects, the as pollution control projects (e.g., a develop and implement pollution physical or operational change for the permitting authority must find that the prevention solutions to the extent project is environmentally beneficial purpose of producing reformulated allowed under the Act. For this reason, gasoline at a refinery is not a pollution before such projects may qualify as a the EPA proposes today to include in pollution control project. control project under the proposed the definition of pollution control exclusion). a. Types of Projects Covered. (1) Add- projects switches to inherently less- On Controls and Fuel Switches. In the A point was raised to EPA that new polluting raw materials and processes pollution control technologies are likely WEPCO rulemaking, EPA found that and certain other types of ‘‘pollution both add-on emissions control projects to be developed over time that will meet prevention’’ projects.18 For instance, the same criteria that technologies and fuel switches to less polluting fuels under these proposed regulations, VOC could be considered to be pollution named above have met. Consequently, a users who switch to water-based or process would be useful whereby any control projects. Today’s proposal powder paint application systems as a affirms that these types of projects are such new technology qualifies as a strategy for meeting RACT or switch to ‘‘pollution control project’’ when a appropriate candidates for the a non-toxic VOC to comply with MACT exclusion, but also greatly expands the history of performance has been requirements, could qualify for this established. The EPA is therefore types of add-on controls covered to exclusion. include other control projects. See proposing that a new technology which meets the following criteria should be proposed §§ 51.165(a)(1)(xxv), 18 As defined in proposed sections, pollution considered eligible for a pollution 51.166(b)(31), 52.21(b)(31), and 52.24(f). prevention means any activity that through process control project exclusion: (1) It has been These types of projects include: changes, product reformulation or redesign, or installed for the purposes of a pollution —The installation of conventional and substitution of less-polluting raw materials, eliminates or reduces the release of air pollutants control project as defined in the advanced flue gas desulfurization and and other pollutants to the environment (including regulation; (2) it has been demonstrated sorbent injection for sulfur dioxide fugitive emissions) prior to recycling, treatment, or in practice; (3) it has been determined (SO2); disposal; it does not mean recycling (other than certain ‘‘in-process recycling’’ practices), energy by the permitting authority to be —-Electrostatic precipitators, baghouses, environmentally beneficial. See high-efficiency multiclones, and recovery, treatment, or disposal [see Pollution Prevention Act of 1990, Pub. L. 101–508, section proposed §§ 51.165(a)(1)(xxv)(A)(7), 6602(b) and section 6603(5) (A) and (B), 42 U.S.C. 52.21(b)(32)(i)(G), 51.166(b)(31)(i)(G), of any increase that exceeds an emissions level used sections 13101(b) and 13102(5) (A) and (B); see also for that source—if any—in the most recent air ‘‘EPA Definition of ’Pollution Prevention,’ ’’ and 52.24(f). quality impact analysis in the area conducted for memorandum from F. Henry Habicht II, May 28, The EPA solicits comment on the purpose of title I. 1992]. extending the pollution control project 38262 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules exclusion to new qualifying through a utilization change (where a requirements. However, a de minimis technologies and the qualification project reduces an emission rate but increase may be subject to a State’s criteria. Specifically, EPA requests increased utilization stemming from the minor NSR requirements. comment on whether control project results in increased emissions of (3) Determination of Increase in technologies, other than those listed the same or other air pollutants). In Emissions. The EPA is today proposing above and at §§ 51.165(a)(1)(xxv)(A)(1) either case, the emissions increases to use a representative actual annual through (6), 52.21(b)(32)(i) (A) through could cause or contribute to a violation emissions approach to determining (E), and 51.166(b)(31)(i) (A) through (E) of any NAAQS or PSD increment, or whether a pollution control project will must be comparable in effectiveness to have an adverse impact on AQRV. result in increased emissions. See those listed technologies on a pollutant- Under the WEPCO rule, permitting proposed §§ 51.165(a)(1)(v)(C)(8), specific basis in order to qualify for the authorities can require a source to 51.166(b)(2)(iii)(H), 52.21(b)(2)(iii)(H), exclusion contained under proposed model its impacts whenever (1) the and 52.24(f). This is the methodology §§ 51.165(a)(1)(xxv)(A)(7), permitting authority has reason to developed in the WEPCO rule and is 52.21(b)(32)(i)(G), 51.166(b)(31)(i)(G), believe that the proposed project would explained in detail in that rulemaking. and 52.24(f). result in a significant net increase in See 57 FR 32323. The use of this The EPA also solicits comment on actual emissions of any criteria approach is premised on the EPA’s whether applicability of the pollution pollutant over levels used for that experience and expectation that in most control project exemption should be source in the most recent air quality circumstances pollution control projects extended to ‘‘cross media’’ pollution impact analysis; and (2) the permitting will not affect how the source is control projects, and whether they authority has reason to believe that such operated so that the calculation of should be required to meet the an increase would cause or contribute to whether a pollution control project will ‘‘environmentally beneficial’’ test.19 To a violation of any NAAQS or PSD result in an emissions increase can be qualify for this exemption, as for all increment or visibility limitation. If this made through the simple comparison of pollution control projects, a ‘‘cross analysis indicates that the increase in pre-change and post-change emissions media’’ pollution control project could emissions will cause or contribute to a rates. Of course, where the permitting not cause or contribute to a violation of violation of any NAAQS or PSD authority expects source operations to any NAAQS or PSD increment or have increment, or result in either visibility change, this methodology allows the an adverse impact on AQRV in a Class limitation or impairment, the pollution post-change emissions to be projected I area. control exclusion does not apply. See 57 based on the new operating levels. In (2) The Cause or Contribute Test. A FR 32322. the case of a pollution control project proposed pollution control project, or The EPA believes that such safeguard that will not affect utilization but any physical or operational change, needs to be included in this proposal as collaterally increases a non-targeted cannot result in an emissions increase well. Thus, where a pollution control pollutant, this proposal requires that the that will cause or contribute to a project will result in a significant actual increase (calculated using the violation of any NAAQS or PSD increase in actual emissions and the new emissions rate and current increment, or have an adverse impact on increased level has not been previously utilization pattern) must be analyzed to AQRV in a Class I area. See sections analyzed for its air quality impact and determine its air quality impact. 110(a)(2)(C), 165, and 173 of the Act; see raises the possibility of a NAAQS or Although the EPA is supportive of also 57 FR 32322–32323. To ensure that increment or adverse impact on an pollution prevention projects and the proposed pollution control project AQRV, the permitting authority would strategies, special care must be taken in exclusion does not have this proscribed require the source to provide an air classifying a project as a pollution impact, EPA is also proposing to adopt quality analysis sufficient to control project and in evaluating a (with some changes) the air quality demonstrate that the impact of the project under a pollution control project impacts safeguard currently in place for project would not cause or contribute to exclusion. Virtually every utility pollution control projects. See a violation of any NAAQS or PSD modernization or upgrade project at an proposed §§ 51.165(a)(1)(v)(C)(8), increment, or have an adverse impact on existing industrial facility which § 51.166(b)(2)(iii)(H), AQRV. The EPA would not necessarily reduces inputs and lowers unit costs has § 52.21(b)(2)(iii)(H), and § 52.24(f). require that the increase be modeled, the concurrent effect of lowering an It is possible that a pollution control but the source must provide sufficient emissions rate per unit of fuel, raw project, while significantly reducing the data to satisfy the permitting authority material or output. Nevertheless, it is emissions rate of a targeted pollutant, that the new levels of emissions will not clear that these major capital could still cause an increase in actual cause or contribute to a violation of any investments in industrial equipment are emissions of that or another pollutant at NAAQS or PSD increment, and will the very types of projects that Congress the source. This could occur either from have an adverse impact the AQRV in intended to address in the new source the project causing collateral emissions nearby Class I areas. modification provisions. See Wisconsin (such as in the case of a VOC incinerator Since a significant increase in a Electric Power Co. v. Reilly, 893 F.2d nonattainment pollutant would be 901, 907–10 (7th Cir. 1990) (rejecting which causes NOX emissions) or considered to contribute to the existing contention that the utility life-extension 19 A ‘‘cross media’’ pollution control project could nonattainment problem, in the case of project was not a physical or operational be defined as either a control technology or nonattainment areas the State or the change); Puerto Rican Cement Co., Inc. application to comply with limitations established source would be required under this v. EPA, 889 F.2d 292, 296–98 (1st Cir. under other Federal environmental laws (e.g., Safe proposal to mitigate (e.g, through offsets 1989) (major NSR was found to be Drinking Water Act or Clean Water Act) that results in emissions to the atmosphere. For example, to or SIP measures) any significant applicable to a modernization that comply with an effluent limitation established increase in a nonattainment pollutant decreased emissions per unit of output). under the Clean Water Act, a source chooses to resulting from the pollution control Moreover, projects which significantly install a control device that removes the pollutant project. De minimis collateral emissions increase capacity, decrease production from the wastewater stream and discharges it into the atmosphere. This type of pollution control increases (e.g., less than 40 tpy of VOC costs, or improve product marketability project could qualify for the exclusion provide it is in a moderate ozone nonattainment may dramatically increase source environmentally beneficial. area) would not trigger such mitigation operations. In these situations, the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38263 environment may or may not see a environmental impact test for the listed standard and reasonable practices, reduction in overall source emissions pollution control projects. See proposed determines if a significant net increase due to the project.20 Nevertheless, the §§ 51.165(a)(1)(xxv)(A) (1) through (5), in representative actual emissions will EPA believes that these types of projects 51.166(b)(31)(i) (A) through (E), occur and, if so, whether the resultant may have other desirable environmental 52.21(b)(31)(i) (A) through (E), and air quality or AQRV impacts are effects by reducing energy and raw 52.24(f). acceptable. See 57 FR 32322. materials consumption and minimizing However, the EPA proposes to retain In addition, as discussed above, for a waste by-products. Consequently, the the environmentally beneficial standard proposed project to qualify as a EPA solicits comment on how to for pollution prevention projects. See pollution control project the permitting address pollution prevention projects proposed §§ 51.165(a)(1)(xxv)(A)(6), agency must first determine that the that can be reasonably expected to result 51.166(b)(31)(i)(F), 52.21(b)(31)(i)(F), project will be environmentally in a significant increase in emissions and 52.24(f). Unlike the list of pollution beneficial. The decision-making process resulting from increased utilization of control projects described above for should include documentation of the the affected emissions unit(s) where which the environmental impacts are basis for a finding that a proposed notwithstanding such increase an known and EPA is satisfied that the pollution prevention project is overall positive environmental benefit is projects will be environmentally environmentally beneficial. The EPA evident. Specifically, where emissions acceptable, a project that may be also solicits comment on the adequacy are expected to increase significantly as acclaimed as a pollution prevention of these procedural safeguards and the a result of a pollution prevention project may not be as well documented need for any additional or alternative project, should these types of projects be or substantiated as others and its safeguards. effectiveness may depend on site- allowed to take advantage of this 5. Emission Reduction Credits pollution control project exclusion? specific factors. Any project requesting a pollution prevention exclusion should In general, certain pollution control 3. The Environmentally Beneficial Test be reviewed by the permitting authority projects approved for an exclusion from The WEPCO rule also provided that, to ensure that the project’s overall major NSR could result in emission to qualify for exclusion, a pollution impact on the environment is reductions which may serve as NSR control project cannot render the unit beneficial.22 Once a particular kind of offsets or netting credits. Under this less environmentally beneficial. For the project has been demonstrated to be proposal, credit may be given for all or proposed list of pollution control environmentally beneficial, the part of the emission reductions equal to projects and for fuel switches to a less- permitting authority could rely on this the difference between the pre- polluting fuel, EPA is satisfied that the demonstration in evaluating subsequent modification actual baseline emissions overall impact on the environment of applications for the same kind of and post-modification PTE for the these projects is beneficial and that, project. A subsequent project could be decreased pollutant provided that (1) consequently, such projects are presumed environmentally beneficial the project will not result in a desirable from an environmental unless case-specific factors or impacts significant collateral increase in actual perspective. These are the very types of would indicate otherwise. emissions of any criteria pollutant, (2) pollution controls that have historically the project is still considered 4. Procedural Safeguards been applied to new and modified major environmentally beneficial, and (3) all and minor sources for the purpose of Nothing in current guidance or in this otherwise applicable criteria for the reducing emissions based on known and proposal voids or creates an exclusion crediting of such reductions are met permissible environmental effects. from any applicable minor NSR (e.g., quantifiable, surplus, permanent, Inherent in their historic use has been preconstruction review requirement in and enforceable). Where an excluded the basic understanding that from an any SIP that has been approved pollution control project results in a overall environmental perspective the pursuant to section 110(a)(2)(C) of the significant collateral increase of a use of such controls is acceptable. The Act and 40 CFR 51.160 through 164. See criteria pollutant, emissions reduction EPA has no reason at this time to doubt footnote 10. Accordingly, the EPA credits from the pollution control the validity of this presumption when believes that a pollution control project project for the controlled pollutant such controls are applied to existing qualifying for this proposed exclusion could still be granted provided, in sources in a manner consistent with generally will be required by the addition to (2) and (3) above, the actual standard and reasonable practices.21 applicable SIP to obtain a minor NSR collateral increase is reduced below the Consequently, as part of the exclusion permit prior to beginning construction. applicable significance level, through for pollution control projects, EPA’s The EPA expects the minor NSR either internal contemporaneous proposal would not require an overall permitting process to be the mechanism reductions or external offsets. However, by which the permitting agency reviews neither the exclusion from major NSR 20 This is in marked contrast to the addition of the pollution control project to ensure nor any credit (full or partial) for pollution control equipment which typically does that the project design is consistent with emission reductions would be available not, in EPA’s experience, result in any increase in where the type or amount of the the source’s utilization of the emission unit in 22 For example, a pollution prevention project emissions increase which would result question. which while decreasing emissions of a criteria from the use of such credits would 21 The presumption that the listed projects are pollutant results in an unacceptable increased risk environmentally acceptable is premised on an due to the release of air toxics should not be lessen the environmental benefit understanding that such controls would be considered environmentally beneficial. However, associated with the pollution control designed and operated in a manner consistent with the EPA expects that many pollution prevention project to the point where the project standard and reasonable practices, (e.g., increases in projects will be for the purpose of compliance with collateral pollutants are minimized within the title III MACT requirements and by their nature will would not have initially qualified for an control’s inherent design, no unacceptable result in reduced risk from air toxics. Consequently, exclusion. increased risk due to the release of toxic pollutants in judging whether a pollution prevention project The EPA solicits comment on would occur). Where a permitting agency can be considered environmentally beneficial, alternative methods for calculating determines that an otherwise listed project would permitting authorities may consider as a relevant emissions reduction credits, especially not be constructed and operated in such a manner, factor whether a project is being undertaken to then that specific project would not qualify as a bring a source into compliance with a MACT, if the NSR applicability rules are listed project for the purpose of the exclusion. RACT, or other Act requirement. revised. 38264 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

F. Proposed Plantwide Applicability for the source and the permitting practice. The EPA believes that Limitations (PAL) authority; (4) an incentive for source regulatory changes would allow for The EPA today proposes a new owners and operators to create room for more ease, clarity, and certainty in the applicability approach for existing growth under the cap by implementing implementation of a PAL approach. sources under which a source, if pollution prevention and other Accordingly, the EPA proposes to define authorized by a State in a SIP, may base pollution reduction strategies on PAL and PAL major modification. See its NSR applicability on a plantwide existing emissions units; and (5) proposed §§ 51.165(a)(1)(xxx) and emissions cap, termed a plantwide reduction of some of the ‘‘paper’’ (a)(1)(xxxi), 51.166(b)(44) and (b)(45), applicability limitation (PAL). So long emissions in the system, thereby 52.21(b)(45) and (b)(46), and 52.24(f). The EPA proposes to define as source activities do not result in creating additional room for growth for ‘‘plantwide applicability limitation’’ as emissions above the cap level, the new and modified sources. a federally enforceable plantwide source will not be subject to major NSR. 1. Background emissions limitation established for a The voluntary source-specific PAL is a Plantwide emissions limits for NSR stationary source to limit the allowable straightforward, flexible approach to applicability have been used in Oregon emissions of a source to a level such determine whether changes to an for many years and have been utilized that major NSR is not required for existing major stationary source result by individual sources on a case-by-case changes under that emissions limitation. in an emissions increase. In the NSR basis. The state-wide applicability The applicable emissions limitation Reform Subcommittee deliberations, the system in Oregon, known as the ‘‘plant must be established in a federally PAL was viewed as an alternative that site emission limit’’ program, bases enforceable permit that includes all a plant manager could readily major NSR applicability on an emission conditions needed to make the understand. Instead of a case-by-case limit set for each major source in the limitation practically enforceable. The assessment of whether a modification is State. When the program originated, the EPA proposes to define a ‘‘plantwide excluded from major NSR, the manager State capped sources at their actual emissions limitation major knows that as long as the plant stays emissions levels. New sources are modification’’ as any emissions increase within its emissions cap, major NSR capped at their NSR permitted level. over the PAL, notwithstanding the will not be triggered. Production units During the NSR Reform Subcommittee general definition of ‘‘major can be started and stopped, product deliberations, representatives from modification.’’ lines reconfigured, and products several companies with operations in The EPA proposes to add regulatory changed and revamped without delay Oregon briefed members on the provisions that (1) allow the use of a from major NSR. advantages of the system for their firms. PAL for applicability determinations for In addition, the PAL approach should They focused on the flexibility afforded major modifications rather than the provide a valuable tool for managing a under the cap and their ability to existing or proposed provisions, (see number of other Act requirements. For expand operations and production proposed §§ 51.165(a)(9)(i), 51.166(u)(1) instance, a NSR PAL may also include without regulatory review. and 52.21(x)(1)); (2) prescribe the basis terms that allow changes to be made During the NSR Reform for establishing a PAL and additional without triggering minor NSR or which Subcommittee deliberations, the EPA PAL terms and conditions, (see essentially preauthorize the minor NSR also developed and presented a proposed §§ 51.165(a)(9)(iii), approval, as allowed by State law and voluntary, source-specific PAL 51.166(u)(3) and 52.21(x)(3)); (3) the SIP. In fact, the EPA and the State approach, similar to that demonstrated describe control technology application of Oregon have been working with Intel by a Minnesota Manufacturing and when a source proposes a PAL major to develop a NSR/title V permit that Mining (3M) facility in St. Paul, modification, (see proposed uses Oregon’s plant site emission limit Minnesota. This permit established a §§ 51.165(a)(9)(iv), 51.166(u)(4) and program, minor NSR pre-approval, PAL which allowed 3M to make many 52.21(x)(4)); (4) describe public notice pollution prevention, and synthetic changes to its facility without triggering and comment procedures for minor limits on any HAP to create a NSR review. The source’s baseline establishing a PAL, (see proposed flexible permit under title V, major NSR, emissions were based on a level that §§ 51.165(a)(9)(ii), 51.166(u)(2) and and the State’s preconstruction review was lower than past actual emissions 52.21(x)(2)); (5) describe the process for program. Available information but reflected most current actual periodic reevaluation of a PAL, (see regarding this permit is in the public emissions based on current operations proposed §§ 51.165(a)(9)(v), 51.166(u)(5) docket identified at the beginning of this with new controls. Since the 3M permit, and 52.21(x)(5)); and (6) describe preamble. EPA understands that other States (and additional conditions that would ensure In short, EPA foresees the PAL option sources) have experimented with the a PAL remains protective of air quality offering a number of advantages for issuance of permits with emissions caps while providing flexibility for source industry, permitting authorities and the under EPA’s existing regulations. operations, (see proposed environment, including (1) increased Additional information on these §§ 51.165(a)(9)(iv)(A), 51.166(u)(4)(i) operational flexibility and the ability to approaches is contained in the docket and 52.21(x)(4)(i)). make timely changes to react to market for this proposal. demand; (2) certainty regarding the level 3. Discussion of emissions at which a stationary 2. Description of the PAL Proposal The EPA has determined that the source will be required to undergo The EPA proposes to revise the NSR voluntary source-specific PAL is a major NSR (thereby eliminating the regulations to allow States to authorize practical method to provide both need to establish a baseline for each PAL approaches on a voluntary source- flexibility and regulatory certainty to modification, calculate the by-source basis. Although a source-by- many existing sources, as well as contemporaneous increases and source PAL approach may be benefits to permitting authorities, while decreases, and determine whether the implemented in many situations under maintaining air quality. Accordingly, source qualifies under another the current regulations, several PAL- the EPA today proposes to revise its exclusion or another emissions increase related issues are not clearly addressed NSR regulations to provide for this test); (3) a decreased permitting burden by the current regulations, policies, or approach as a voluntary source-specific Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38265 option that States may adopt in their and public participation process, to agreement to adopt the PAL approach SIP. review the need for revisions. The EPA on a limited basis. For example, States The regulatory proposal allows PAL also proposes to require that the PAL may choose to adopt the PAL approach to be established for existing major must be federally and practicably only in attainment/unclassifiable areas, stationary sources in PSD areas, and for enforceable and therefore must be only in nonattainment areas, for proposed and existing major stationary incorporated into federally enforceable specified source categories, or only for sources in nonattainment areas. In all permits containing compliance methods certain pollutants in these areas. States cases, the EPA is proposing that the PAL and monitoring requirements. may also choose to allow the PAL be established through a public a. PAL Levels. The EPA proposes that approach only for sources with a record participation process consistent with a PAL be based on plantwide actual of existing emissions or normal the requirements at 40 CFR 51.161, and emissions, including a reasonable operations for at least 2 years, in order with a public comment period of at least operating margin less than the to establish a PAL based on historical 30 days. See proposed applicable significant emissions rate, for actual emissions. §§ 51.165(a)(9)(ii), 51.166(u)(2) and existing sources or on a level c. Changes Under the PAL Approach. 52.21(x)(2). established pursuant to recent (within The EPA requests comment on several The EPA considered a number of the preceding 5 years) major possible scenarios involving changes regulatory options addressing new and nonattainment NSR where the source- under the PAL approach. First, under existing sources in both areas and is wide levels were completely offset and this proposal, facilities that wish to requesting comment on emissions levels relied upon in an EPA-approved increase source-wide emissions over the for PAL for both areas. The EPA believes attainment demonstration. See proposed PAL would trigger major NSR. See that the proposed PAL regulatory §§ 51.165(a)(9)(iii), 51.166(u)(3) and proposed §§ 51.165(a)(9)(iv)(B), provisions offer the best approach for 52.21(x)(3). The EPA requests comment 51.166(u)(4)(ii) and 52.21(x)(4)(ii). In both proposed and existing major on alternatives for establishing a PAL, some instances, the increase will result stationary sources located in including (1) Actual emissions, as from the addition of a new unit or nonattainment areas and existing major defined in existing § 51.166(b)(21)(ii); physical or operational change to an stationary sources in attainment/ (2) actual emissions, as defined in existing unit. Clearly, the units unclassifiable areas. In PSD areas, the proposed § 51.166(b)(21)(ii); (3) actual associated with the increase would be ‘‘Clean Facility’’ exclusion offers the emissions with the addition of an reviewed for control technology, BACT best flexibility for new major stationary operating margin greater than the or LAER, air quality impact modeling, sources. Certainly, when a facility applicable significant emissions rate; (4) and emissions offsets, if applicable. cannot exercise the clean facility for a new stationary source, limits However, the EPA raises for exclusion either because its permit is established pursuant to review of the consideration the situation where a older than 10 years or because a change entire facility under PSD, and (5) for source may wish to increase emissions is not consistent with the PSD permit, nonattainment pollutants (in above the PAL as a result of an increase it will have historic emissions of at least nonattainment areas), any emissions in an overall plant production rate. In 2 years upon which to establish a PAL. level completely offset and relied upon this case, it may not be obvious which A permitting authority may choose to in an EPA-approved State attainment units would have to apply BACT or adopt an area-wide PAL approach, demonstration plan, even when the LAER. As proposed, a PAL major rather than a voluntary source-specific source has not recently received a major modification would require BACT or approach, so that all major sources in NSR permit. LAER for each pollutant limited by the the entire area, designated as b. Options for Permitting Authorities. PAL which will be increased. Thus, nonattainment or attainment/ The proposal would incorporate the BACT or LAER would apply to each unclassifiable for a given pollutant, PAL approach into the NSR rules by emissions unit that contributes to the would have a PAL. Area-wide PAL adopting new PAL provisions in emissions increase that occurs above the approaches would be options for States §§ 51.165, 51.166, and 52.21. A number latest PAL. Id. and not mandatory for any area under of new provisions have been developed The EPA requests comment on how to this proposal. The EPA seeks comment to specify the requirements of using a apply the major NSR requirements to on area-wide PAL approaches in light of PAL approach. The EPA requests emissions increases that are not directly the source specific voluntary criteria in comments on these provisions which associated with a particular this proposal and requests comment on are described in more detail below. modification or physical change to an other criteria or minimum requirements The proposed rules allow the use of emissions unit. Major NSR could be for area-wide PAL approaches. The EPA a PAL for NSR applicability in lieu of applied to: (1) all modifications that also seeks comment on whether States the applicability provisions in § 52.21. have occurred under the PAL; (2) all adopting an area-wide PAL system See proposed § 52.21(x). Similarly, modifications that have occurred under should be allowed to establish PAL at revisions to §§ 51.165 and 51.166 are the PAL since the last PAL renewal; (3) levels higher than actual emissions. proposed to provide an alternative all modifications that have occurred The EPA proposes that once a PAL’s applicability approach that States may under the PAL in the last 5 years; (4) is established for a facility, the source adopt into SIP to facilitate use of only those modifications that can be may make any physical or operational voluntary source-specific PAL. See associated with the increase, as changes at the facility as long as its proposed §§ 51.165(a)(9) and 51.166(u). proposed by the source, or (5) the entire emissions remain under the PAL. Under Under the proposed PAL rules, States facility and BACT or LAER can apply the proposal, for a source to increase may choose to adopt or accept where most appropriate, i.e, any emissions over its PAL, whether or not delegation of PAL approaches to apply uncontrolled units or the less controlled in connection with a physical or at sources only in lieu of otherwise units. operational change, it must first undergo applicable major NSR applicability In light of the benefits offered by this major NSR. The EPA proposes to rules, or to apply in lieu of both major approach and the ability of the States to provide that emissions levels set by the and minor NSR requirements. When impose control technology requirements PAL may be reevaluated periodically, adopting the PAL approach, States may in SIP, the EPA requests comment on consistent with the title V permitting choose in their SIPs or delegation whether to require, for all new units 38266 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules which net out of major NSR or for all prevents the State’s PAL program from change a source’s impact area, and must new units added under a PAL, that being more stringent by requiring be assessed to demonstrate protection of States must impose some level of adjustments in other circumstances NAAQS, increments, and AQRV. See control technology, or similarly whether such as those described above. In proposed §§ 51.165(a)(9)(iv)(A), to require in the Federal regulations the addition, the EPA solicits comments on 51.166(u)(4)(i) and 52.21(x)(4)(i). The application of a particular level of the need for a specific provision that EPA requests comment on when control technology. would require the PAL to be adjusted at modeling or other types of ambient d. Plantwide Applicability Limitation any time to address any technical errors impact assessments should be required Review and Adjustments. The PAL, in the emissions calculations and other for changes occurring under a PAL. once included in a permit, may be permit deficiencies when discovered by Comments may also address the adjusted for a number of reasons. either the source owner or operator or usefulness of existing guidance on Industry, regulatory agencies, and the the permitting authority after the permit similar issues (see e.g., June 28, 1989 public need to understand what has been issued. Federal Register Notice addressing adjustments to a PAL may be necessary, e. Plantwide Applicability Limitations CMA (54 FR 27274) and the Emissions both on an immediate basis and during in Serious and Above Nonattainment Trading Policy Statement (51 FR some periodic review cycle. The EPA Areas. The EPA also solicits comment 43814)), and what should be done to requests comment on why, how, and on how a PAL will comply with section protect AQRV in Class I areas. when a PAL should be lowered or 182(c) and (e) of the Act which contains increased without being subject to major special provisions for modifications to G. Actual-to-future-actual Methodology NSR. The need for adjustments would major sources in serious, severe and As previously discussed, the EPA arise, for example, (1) Where technical extreme ozone nonattainment areas. For explicitly limited the scope of the errors have been made, or technical serious and severe nonattainment areas, WEPCO rulemaking to one source improvements have become available depending on the baseline used to category, i.e., electric utility steam with regard to calculating past actual establish a PAL, a PAL may effectively generating units. In the final rule, emissions or potential emissions or assure that sources do not increase however, the EPA indicated that it emissions factors; (2) when new emissions (thereby changes under the would ‘‘consider the desirability of requirements apply to the PAL PAL would not trigger these special adopting for other source categories the pollutant, such as RACT or other SIP- provisions). This is because the PAL in changes to the methodology for required reductions 23; (3) to account for an ozone nonattainment area would in determining whether a source change the generation of offsets or permanent most cases be based on actual emissions constitutes a modification’’ in a shutdowns where the State has the of the source and require any increase subsequent rulemaking. See 57 FR authority to remove permanent over the PAL to be subject to major NSR 32333. In previous sections, the EPA shutdowns from the emissions with no allowance for de minimis discusses its proposals to adopt a new inventory after a certain time period; (4) emission increases over the PAL. Thus, pollution control project exclusion when any changes (though consistent with these stipulations, the de minimis applicable to all source categories and to with the PAL) might cause or contribute emissions rate (25 tpy) under section replace its existing baseline regulations to a violation of any NAAQS or PSD 182(c)(6) of the Act could not be with a new provision, again applicable increment or would have an adverse exceeded without triggering major NSR. to all source categories. There remains impact on air quality related values; and In extreme ozone nonattainment areas, the question of the ‘‘future-actual’’ (5) during periodic review, consistent section 182(e)(2) of the Act requires methodology which allows a utility to with the title V permit renewal process major NSR for ‘‘any increase’’ at any use a prediction of its post-change of the appropriateness of emissions discrete operation or unit. In such areas actual emissions—excluding any levels set in the PAL. A concern was a PAL may be problematic because it increases in utilization caused by raised in the NSR Reform Subcommittee could allow for an increase at an demand growth—to determine whether discussions about the uncertainty that emissions unit by a change under a the change at issue will increase results from the State review and PAL, although there would be no emissions over baseline levels. renewal of the PAL as well as any emissions increase of the source’s PAL. The WEPCO rule was challenged by authority to adjust the PAL. It has been The provisions of section 182(e)(2) both industry and environmental petitioners. These challenges included a recognized that sources will want to appear to allow for a PAL provided that demand from some industries that EPA maximize the room for growth under a any increase at an emissions unit would expand the WEPCO rule to all source PAL. If there are too frequent impose a LAER emissions limit on that categories and a demand from an opportunities for a downward unit and the unit’s increase in emissions environmental group that EPA abandon adjustment to the PAL, a source may be would have to be ‘‘internally offset’’ the rule or at least the demand growth reluctant to accept a PAL for fear of within the source, which is in effect a exclusion. This litigation is now losing allowable emissions through the 1.3 to 1 internal ‘‘netting’’ transaction. inactive pending the outcome of this State’s ability to make adjustments. Thus a PAL in an extreme This proposal requires adjustments to nonattainment area may have to be a rulemaking. Today, EPA proposes to the PAL to incorporate new applicable ‘‘declining value’’ cap reducing at a rate allow use of the future-actual requirements. See proposed that ensures sufficient ‘‘internal offsets’’ methodology for all source categories. §§ 51.165(b)(9)(v), 51.166(u)(5) and are undertaken to fulfill the See proposed §§ 51.165(a)(1)(xii)(F), 52.21(x)(5). Nothing in this proposal requirements of section 182(e)(2) of the 51.166(b)(21)(vi), 52.21(b)(21)(vi) and Act. The EPA welcomes additional 52.24(f). 23 Emissions reductions of HAP to meet MACT at comment on how a PAL may comport As discussed in section II.A. of this emissions units under a PAL would generally not with the statutory requirements for preamble, EPA proposes that States be necessitate a downward adjustment to the PAL modifications to major sources in these given the choice of whether to retain in because the PAL is not designed to limit HAP. ozone nonattainment areas. their SIP the current actual-to-potential However, if MACT reductions are relied on in the SIP (e.g., VOC reductions in nonattainment areas f. Air Quality Changes. Certain test, or to adopt the actual-to-actual test used for RFP or attainment demonstrations) then changes under the PAL, such as changes for all source categories. Although EPA the PAL needs adjustment downward. in effective stack parameters, can is also proposing the actual-to future Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38267 actual test for the Federal permitting actual emissions would occur under this Thus, the promulgated regulatory program in lieu of the current actual-to- methodology, the EPA provided in its provision excluded from the calculation potential test, EPA solicits comments on final regulations that any utility which of future emissions: whether to retain the actual-to-potential uses the ‘‘representative actual annual that portion of the unit’s emissions following test. In addition, EPA solicits comments emissions’’ methodology to determine the change that could have been on whether to leave the scope of the that it is not subject to NSR must submit accommodated during the representative future actual methodology the same— annually for 5 years after the change baseline period and is attributable to an available only for utility units or sufficient records to demonstrate that increase in projected capacity utilization at eliminating the methodology the change has not resulted in an the unit that is unrelated to the particular completely.24 In addition, in regard to change, including any increased utilization emissions increase over the baseline due to the rate of electricity demand growth use of a future actual methodology, the levels. See 57 FR 32325. To meet this for the utility system as a whole. EPA solicits comment on what changes requirement, utilities can use if any should be made to the demand continuous emissions monitoring data, See, e.g., existing § 51.166(b)(32)(ii). The EPA explained that this provision growth exclusion and the 5-year operational levels, fuel usage data, allows demand growth to be excluded tracking requirement. source test results, or any other readily from the calculation of future emissions available data of sufficient accuracy for 1. Background only ‘‘to the extent it—and not the the purpose of documenting a unit’s physical or operational change—is the As noted, the WEPCO rule in EPA’s post-change actual annual emissions. cause of the emissions increase.’’ See 57 regulations prescribed a new Where the change does not increase the FR 32327. On the other hand, any methodology for determining whether a unit’s emissions factor, the utility may emissions increases attributable to a physical or operational change would submit annual utilization data, rather physical or operational change that result in a significant increase in than emissions data, as a method of ‘‘significantly alters the efficiency of the emissions and therefore constitute a tracking post-change emissions. Id. If, plant * * * must be included in the major modification. The rule provided during the required 5-year tracking post-change emissions calculations.’’ that the post-change emissions level of period, the unit’s post-change actual See 57 FR 32327. Thus, the question of a utility unit would be calculated using emissions exceed its pre-change exclusion of independent factors, such a projection of the unit’s ‘‘future actual’’ baseline level, the unit is then subject to as system-wide demand growth, is ‘‘a emissions. The rule was limited to NSR. Emissions increases which occur question of fact which must be resolved existing electric utility steam generating after the required 5-year tracking period on a case-by-case basis and is dependent units and did not apply to the addition are presumed not to be related to the on the individual facts and of a new unit or the replacement of an earlier change.27 existing unit.25 circumstances of the change at issue.’’ Pursuant to the WEPCO rule, the As discussed, the NSR regulatory Id. future actual projection is the product of provisions require that the physical or operational change must ‘‘result in’’ an 2. Limitation of the WEPCO Rule to One (1) the hourly emissions rate, which is Source Category based on the unit’s physical and increase in actual emissions in order to operational capabilities following the consider that change to be a The EPA indicated in the WEPCO rule change and taking into account federally modification. See also the discussion of that it had ‘‘high confidence’’ that a enforceable operational restrictions that the term ‘‘modification’’ in section II.B. workable ‘‘future-actual’’ methodology would affect the hourly emissions rate of this preamble. In other words, NSR could be developed for the utility following the change; and (2) projected will not apply unless there is a causal industry for all changes that did not capacity utilization, which is based on link between the proposed change and involve construction of a new unit or both the unit’s historical annual any post-change increase in emissions. the replacement of an existing unit. See utilization and all available information In the WEPCO rule, EPA clarified this 57 FR 32333. Specifically, the EPA regarding the unit’s likely post-change provision in the context of pointed to several factors, including (1) capacity utilization. See 57 FR 32323.26 modifications at electric utility a limited and technologically To guard against the possibility that generating units to exclude increases homogeneous source population; (2) significant unreviewed increases in due to ‘‘independent factors’’ such as oversight by State Public Utility demand growth. The EPA stated that: Commissions that typically evaluate 24 This discussion of the use of the future-actual where projected increased operations are in utility growth and utilization methodology as an applicability test is separate response to an independent factor, such as projections; and (3) requirements in title from the proposed use of the methodology to demand growth, which would have occurred IV of the Act that mandate continuous project emission increases from pollution control and affected the unit’s operations during the emissions monitors (CEM) or other projects in section II.E. highly accurate methods for recording 25 A unit is considered replaced if it would representative baseline period even in the constitute a reconstructed unit within the meaning absence of the physical or operational actual emissions, as well as special of 40 CFR 60.15 (the NSPS test for change, the increased operations cannot be reporting requirements. In EPA’s ‘‘reconstruction’’). The EPA reasoned that since said to result from the change and therefore judgment, these factors meant that there is no relevant operating history for wholly may be excluded from the projection of the permitting authorities could make new units and replaced units, it is not possible to reasonably project post-change utilization for these unit’s future actual emissions. Conversely, independent assessments of the likely units, and hence, their future level of where the increase could have occurred post-change emissions and utilization ‘‘representative annual emissions.’’ For other during the representative baseline period but rates of utility emissions units, and changes, past operating history and other relevant for the physical or operational change, that could track these predictions for the information provides a basis for reasonable change will be deemed to have resulted in relevant period to ensure that the utility projections. See 57 FR 32323. the increase. 26 In projecting future utilization and emissions did not exceed its predicted level of factors, the permitting authority may consider the emissions. company’s historical operational data, its own 27 The permitting authority may require a longer The EPA continues to view these representations, filings with Federal, State or local period, not to exceed 10 years, where it determines regulatory authorities, and compliance plans that no period within the first 5 years following the characterizations as generally accurate. developed under title V of the Act. See 57 FR change is representative of normal source There are a relatively limited number of 32323, footnote 19. operations. 57 FR 32325. electric utility installations and, due to 38268 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules title IV and other regulatory programs, expand the ‘‘future actual’’ methodology source would be more speculative than the EPA and State and local permitting to all source categories, the EPA also in the utility industry. In most authorities have extensive information solicits comment on the adequacy of industries, the prediction of future- on the type, fuel, size, and other these safeguards and whether the actual emissions would be left to the characteristics of the electric generating ‘‘future-actual’’ methodology should permitting authority for a case-by-case units in operation. Most of the utilities either be retained only for the electric determination of whether the proposed operating these units are subject to utilities, or be eliminated entirely. change will cause any increase in regulatory oversight by a State Public emissions or whether all or part of any 3. Issues Regarding the ‘‘Future-actual’’ Utility Commission (PUC) which projected increases will be caused by Methodology regularly reviews growth patterns and independent factors. For this reason, utility strategies for meeting future The EPA seeks comment on two EPA seeks specific comments on electrical demand. Finally, as a result of specific parts of the WEPCO rule. First, whether the demand growth exclusion title IV, most large utility units are now, the EPA solicits comment on whether a should be (1) expanded to all source or will be shortly, using CEM to demand growth exclusion should be categories, (2) retained only for the demonstrate continuous compliance included, with or without changes. electric utility sector, or (3) eliminated with many of the Federal and State Second, the EPA solicits comment on for all industries. requirements applicable to their units. whether the 5-year reporting provision In addition, the EPA solicits comment Similarly, the EPA expects that most is working as intended and whether it on the 5-year tracking requirement major sources in the country will be should be changed in any way. which mandates that permitting upgrading their monitoring and As discussed, the WEPCO rule authorities track projections of future reporting capabilities due to the Act’s requires the permitting authority to actual emissions for the 5-year period monitoring and title V operating permit exclude from the post-change emissions following the change to insure the programs. Thus, these sources should estimate, any increase in utilization that accuracy of such projections. The EPA also be able to provide the necessary is unrelated to the particular change, believes that the mechanism is working documentation of their compliance with ‘‘including any increased utilization due as intended. However, the EPA invites a post-change emissions prediction. to the rate of electricity demand growth the public to comment on this issue and However, utilities remain the only for the utility system as a whole.’’ While the experience to date of applicability source category where projections of this provision ‘‘does not amount to a per determinations making use of this demand and facility utilization are se exclusion of demand growth from the safeguard. typically assessed by an independent emissions increase calculation’’ (57 FR H. Proposal of CMA Exhibit B regulatory agency (the State PUC) and 32327), it may create confusion outside are available to the public. Because of the utility area as to when demand As part of the settlement of a this, permitting authorities should be growth increases may be excluded. challenge to the EPA’s 1980 NSR able to find independent data and The WEPCO preamble is very clear regulations by CMA and other industry assessments regarding current that any increases at a unit that result petitioners, the EPA agreed to propose operations and costs for the utility unit from a change that significantly affects (for public comment) and take final subject to the change as well as the efficiency of the unit must be action on a methodology for projected data for the unit after the included in the calculation of future determining whether a source has change. Similarly, the PUC should have actual emissions, although EPA undertaken a modification based on its made an assessment of future demand declined to create a presumption that potential emissions. The exact growth and utility plans to meet this every emissions increase that follows a regulatory language the EPA was to increased demand so a permitting change in efficiency (at an utility propose was set forth in Exhibit B to the authority should be able to secure electric generating unit) is inextricably Settlement Agreement, which is independent corroboration of utility linked to the efficiency change. Id. contained in the docket for this claims in this area as well. Because this Indeed, where the proposed change will rulemaking. Under this methodology, kind of information is typically not increase reliability, lower operating sources may calculate emissions available for other source categories, the costs, or improve other operational increases and decreases based on either EPA is concerned about the basis characteristics of the unit, increases in the actual emissions methodology in the permitting authorities would have to utilization that are projected to follow existing rules or the unit’s potential review projections for other source can and should be attributable to the emissions, measured in terms of hourly categories. change. These factors are the very emissions (i.e., pounds of pollutant per On the other hand, the 5-year tracking factors that utilities use to order the hour). Sources could use this potential- provision that was adopted in the final production dispatch of the various units to-potential test for NSR applicability, WEPCO rule makes the accuracy of the in the system. The EPA believes that as well as for calculating offsets, netting future projection subject to a safeguard this approach has proven to be effective credits and other emissions reductions that should guarantee the accuracy of in distinguishing between demand credits. the prediction for at least 5 years. This growth and other factors that result in The following discussion describes tracking period may be extended to 10 load shifting for utilities. Comment is the proposed alternative in more detail years where the permitting authority is requested on the experience to date with and provides the EPA’s preliminary concerned that the first 5 years will not the use of the WEPCO demand growth assessment of this alternative. be representative of normal source exclusion. operation. See, e.g., existing Moreover, it is clear for other source 1. Description of the Exhibit B § 51.166(b)(21)(v). Even after this time categories that predictions of future Methodology period, the permitting authority may demand and its impact on individual Exhibit B contains a series of still consider whether a particular emissions units are far more revisions to the EPA’s NSR regulations. increase is ‘‘caused’’ by the change and complicated and uncertain. For These revisions are all designed to thus results in an emissions increase consumer-driven industries, for provide sources with the alternative of subjecting the original change to major instance, demand varies and using their hourly potential emissions to NSR. See 57 FR 32326. In proposing to presumptions regarding its size and determine baselines for NSR Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38269 applicability and other NSR purposes. championed the Exhibit B alternative emissions of a new or modified unit. First, Exhibit B would add the following because it would maximize the Thus the widget maker could use credit exclusion to the definition of major flexibility that a source has in for reducing the potential hourly modification: calculating the net emissions increase emissions from a unit in the plant, even A major modification shall be deemed not due to a modification, which would though it had never operated at that to occur if one of the following occurs: (a) exclude more physical and operational emissions level. This credit would allow there is no significant net increase in the changes at existing sources from major the hourly emissions rate of the source’s PTE (as calculated in terms of NSR. The Exhibit B approach would modified unit to increase to greater than pounds of pollutant emitted per hour); or (b) also greatly simplify the task of tracking 10 pounds per hour without subjecting there is no significant net increase in the emissions increases and decreases the source to NSR. source’s actual emissions. because the level of operations and While EPA agrees that the Exhibit B Exhibit B would also delete all actual emissions would generally no alternative would give a source references to actual emissions in the longer be pertinent. maximum operational flexibility and definition of net emissions increase and reduce the administrative burden for 2. The EPA’s Preliminary Analysis adds language indicating that all source and permitting agencies, there is references to ‘‘increase in emissions’’ The EPA has undertaken a concern for the environmental and ‘‘decrease in emissions’’ in the preliminary analysis of the impact on consequences. For example, assume the definition of ‘‘net emissions increase’’ the NSR program of Exhibit B changes. emissions unit at the widget factory that ‘‘shall refer to changes in the source’s The EPA agrees that the Exhibit B is emitting 10 pounds an hour but has PTE (as calculated in terms of pounds alternative would provide maximum historically operated at 40 percent of pollutant emitted per hour) or in its flexibility to existing sources with capacity due at first to operating cost, actual emissions.’’ 28 respect to determining if a significant but with age, reduced efficiency and Other changes in Exhibit B modify the net emissions increase would result reliability. Under the Exhibit B applicability baseline by eliminating the from a physical change or change in the alternative, the owner could modernize reference to the 2-year baseline period method of operation. The primary effect the unit, thus lowering the operating and to a method for determining actual of an hourly potential test is to costs and increasing efficiency and emissions during the representative eliminate a source’s level of operations reliability. This change will allow the period.29 Exhibit B also provides a as a factor when determining whether a owner to use the machine at much methodology for determining if an proposed change will result in an higher levels (e.g., more hours per day increase in hourly emissions is increase. Past and future level of or week) than it had in the past. As a significant.30 Finally, Exhibit B provides utilization of the source are completely result actual emissions (measured in express authorization for sources to use disregarded, unless restricted in some tpy) could more than double due to the potential emissions in calculating way by a federally enforceable SIP or increase in utilization even though offsets and in creating emission permit limit. Consequently, an existing hourly potential emissions remain the reduction credits.31 Industry has source could make any change so long same. as the change does not significantly Further, since Exhibit B would allow 28 For example, Exhibit B calls for EPA to propose increase the source’s hourly potential sources to generate netting credits and these changes to § 52.21 by deleting ‘‘actual’’ emissions rate. For instance, under this emission reduction credit (ERC) for wherever it appears in paragraph (b)(3), except in test, where a source has a widget maker offsets based on potential hourly paragraph (b)(3)(vi)(B) and adding a new paragraph with maximum hourly emissions of 10 emissions, even if never actually (b)(3)(ix) to read as follows: ‘‘(ix) For the purposes of this subsection, ‘increase in emissions’ and pounds per hour, the source may make emitted, and unused operating capacity. ‘decrease in emissions’ shall refer to changes in the any changes it wishes to that machine The effect could be to sanction an even source’s potential to emit (as calculated in terms of so long as the hourly emissions rate greater actual emissions increase to the pounds of pollutant emitted per hour) or in its remains at 10 pounds per hour or less. environment without any review. Of actual emissions.’’ Moreover under Exhibit B, an existing 29 For example, Exhibit B calls for EPA to propose particular concern are potential these changes by deleting the second sentence and source could also use as netting credits emissions levels, which may be the word ‘‘2-year’’ in the first sentence of existing a reduction in the hourly potential consistent with older sources, whose paragraph (b)(21)(ii). emissions rate at one emissions unit, impact have never been assessed. 30 Since EPA’s ‘‘significance levels’’ are expressed even though that emission rate has For example, suppose an old in tons per year, Exhibit B called for any increase never been actually realized, against an 32 in a source’s PTE (as calculated in terms of pounds ‘‘grandfathered’’ source has an hourly of pollutant emitted per hour) to be extrapolated to increase in the hourly potential PTE of 100 pounds per hour, which is a maximum annual emission rate in order to well under the SIP allowable limits determine if it is significant. For example, exhibit section 173(c) of the Act requires that a source based on some other factor (e.g., process B proposed to revise § 52.21(b)(23)(iv) by changing secure sufficient emissions reductions to assure that weight table). Unless there are more it to read as follows: ‘‘A net emissions increase in ‘‘the total tonnage of increased emissions of the air a source’s PTE (as calculated in terms of pounds of pollutant from the new or modified source shall be restrictive permit conditions, 8760 pollutant emitted per hour) is significant if that offset by an equal or greater reduction * * * in the annual hours of operation are assumed, increase, as multiplied by 8760 and divided by actual emissions of such air pollutants.’’ (Emphasis so its annual PTE is 438 tpy. Assume 2000, exceeds the rates specified in subparagraph added). Thus, offsetting emissions reductions the process is old and inefficient, (i) above.’’ (including emissions reduction credits used for 31 For example, Exhibit B proposed to revise offsets) must be calculated in terms of actual however, so the source over its life has § 51.165(a)(3)(i) to read as follows: ‘‘Each plan shall emissions. averaged about 3000 hours of operation provide that for sources and modifications subject The CMA Exhibit B also calls for EPA to propose annually and emitted 150 tpy. Under to any preconstruction review program adopted language regarding the amount of offsetting Exhibit B, the difference, 278 tpy, is pursuant to this subsection, the baseline for emissions. The relevant passage requires offsets to determining credit for emissions reductions is ‘‘represent (when considered together with the plan available as a netting credit. However, either (A) the PTE (as calculated in terms of pounds provisions required under section 172 of the Act) of pollutant emitted per hour) or (B) the actual reasonable further progress (as defined in the plan 32 In this example the ‘‘grandfathered’’ describes emissions of the source from which offset credit is provisions required under section 172 of the Act).’’ a source that was permitted to construct prior to to be obtained’’ and by deleting § 51.165(a)(3)(ii) (A) The EPA views this proposed insert as merely a promulgation of EPA’s PSD regulations. Thus, this and (B) and renumbering the remaining paragraphs restatement of the requirements in sections 172 and source was not subject to the applicable PSD accordingly. However, this proposal on offsets may 173 of the Act. This proposal could be added as requirements (e.g., control technology review and conflict with the 1990 Amendments. That is, § 52.21(a)(3)(ii)(H). modeling analysis). 38270 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules because the plant had never operated and accessibility of their data, and the environmental impacts associated with more than 3500 hours per year and the mix of source categories thus was found the Exhibit B alternative could be 150 tpy emission rate had been constant to represent more typical differences minimized or eliminated; (2) the impact for several years prior to the most recent between allowable and actual of Exhibit B on the permitting of new inventory, 150 tpy was the value the emissions. From each State, a cross ‘‘greenfield’’ sources; and (3) whether State used for various air quality section of sources were chosen. Exhibit B is consistent with the air analyses. In this example the source Allowable and actual emissions were quality planning goals of the NSR could build a second unit with a PTE of determined for each source in the program. That is, while Exhibit B could 288 tpy by simply limiting the existing sample, based on both annual and allow significant increases in actual unit to its nominal 3000 hours of hourly emission rates. For the analysis, emissions to be unreviewed, section 173 operation per year. this information was then segregated by of the Act requires offsets to be based on The magnitude of the environmental pollutant and source type, and, for actual emissions, and the PSD impact of Exhibit B, if promulgated, is combustion sources, further segregated increment system as well as many difficult to predict. Its effects will vary by unit size. nonattainment area plans are keyed to from State to State depending to a great The results of the Texas and Illinois an actual emissions baseline. degree on how much cumulative analysis indicate that typical source If EPA were to promulgate the Exhibit difference exists between the unused operation frequently does result in B settlement as final rules, the Exhibit potential emissions ( so-called ‘‘paper’’ actual emissions that are substantially B rules would need to be updated to emissions and actual emissions in a below allowable emissions levels. In reflect other rule changes since 1980 as given inventory of sources and to what these two States, actual emissions well as provisions of the 1990 extent those ‘‘paper’’ emissions have represent from 30 to 86 percent of the Amendments. In this context, the EPA been used in attainment allowable emissions, depending on also solicits comment on updating the demonstrations, impacts analyses, etc. If source category and pollutant. Exhibit B language. there is little difference between annual Finally, one of the most troubling side effects of the Exhibit B proposal is that I. Allowed Activities Prior to Receipt of allowable and actual emissions as may Permit be the case in some States, the choice of it could ultimately stymie major new either level as the baseline for netting source growth by allowing unreviewed Several industry members of the and other ERC’s purposes would have increases of emissions from Subcommittee recommended that EPA little significance with regard to the modifications of existing sources to change the NSR regulations to enable impact on air quality. consume all available increment in PSD sources to engage in a broader range of The EPA conducted an analysis to areas. After the minor source baseline activities prior to receipt of an NSR estimate the potential environmental date has been established in an area, all permit in cases involving modifications impacts associated with the CMA increases, whether subject to major NSR to existing sources. See, e.g., 40 CFR Exhibit B potential-to-potential or not, consume increment. As §§ 51.166(b)(11) and 52.21(b)(11). These approach. (See ‘‘Results of Data illustrated in the example above, under industry members asserted that it was Gathering and Analysis Activities for the CMA Exhibit B test an old unnecessary and inappropriate to the CMA Exhibit B Settlement grandfathered source could experience a prohibit preliminary activities to Agreement,’’ November 1988, which has ‘‘significant’’ net increase in annual achieve the statutory purpose of been placed in the public docket actual emissions, yet it would not requiring a permit before construction identified at the outset of this necessarily be subject to review. Since begins, and that such prohibitions preamble.) This analysis was performed increment consumption after the minor caused delay and added expense for no to estimate the difference between source baseline date is calculated based good purpose. EPA realizes that there is allowable and actual emissions for on actual emissions increases, the a wide difference of opinion on these permitted facilities in selected study ‘‘minor’’ modification of the issues and is soliciting comments. Set areas. Available actual, permitted, and grandfathered source would still forth below is a summary to assist in SIP allowable emissions data were consume increment. If a major new formulating comments. New Source Review is a obtained from the States of North source with state-of-the-art emission preconstruction requirement, and the Carolina, Texas, Illinois, and Oregon. controls proposes to locate in an area in Due to problems with the data and which the increment has been statute plainly bars construction other circumstances, the analysis consumed in this manner, it would be without a permit. The congressional focused only on the States of Texas and barred from building unless and until policy behind this is obvious: to insure Illinois because these States appeared to the increment problem was resolved. At that well-reasoned permitting decisions have a more thorough data base and the same time, older plants would that may involve millions of dollars and significant, long-lasting environmental realistic distribution of data.33 Both continue to be able to make changes impacts are made before companies Texas and Illinois have engaged in resulting in significant unreviewed, and begin actual construction on a new or substantial permitting activity over the possibly uncontrolled, actual emission modified source of air pollution. If it years. The completeness, availability increases. were otherwise, and companies were 3. The EPA Action 33 In conjunction with its plant site emission limit given unlimited ability to place ‘‘equity program, Oregon requires sources, after operation As provided under the CMA in the ground’’ by constructing plants for a specified period of time, to take enforceable Settlement Agreement, the EPA is today before a permit is issued, permitting permit restrictions on annual allowable emissions proposing the regulatory changes authorities’ discretion in making permit based on annual actual emissions during normal operation. This requirement effectively removes contained in Exhibit B as another decisions may be compromised, and the ‘‘paper emissions’’ from its inventory. Oregon alternative, and seeks comments on ability of EPA and citizens to challenge appears to be unusual in its comprehensive those changes and the EPA’s the permit that is eventually issued may application of this requirement; consequently, its preliminary analysis described above. likewise be undermined. Thus, the data could not form the basis of any conclusions about CMA Exhibit B. North Carolina’s historical The EPA also solicits comment on (1) general policy at issue is clear, and it is data was determined to be insufficient to allow the environmental impact of the Exhibit likewise clear that core activities at an statewide analysis. B proposal and how any adverse industrial site, such as the fabrication or Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38271 installation of pollution-generating Issues have included (1) the scope and proposed regulatory language pertaining equipment, constitute ‘‘construction’’ comprehensiveness of the universe of to the universe of candidate within the meaning of the Act. At the candidate technologies which must be technologies, and limitations on the same time, the statute does not address considered; (2) when the universe of consideration of new technologies also the details of the construction process, control technology candidate extend to LAER. Thus, the EPA is nor does it constrain EPA’s discretion to technologies may be closed to the proposing to add such new provisions fashion regulatory mechanisms to introduction of new technologies applicable to LAER, which are harmonize the needs of environmental relative to a given permit application analogous to the proposed changes protection and economic growth in a and, (3) the methodology for analyzing described above for BACT under the manner consistent with the legislative the candidate technologies for BACT. PSD program. See proposed purpose. Consistent with these statutory The CAAAC made several § 51.165(a)(2)(ii). goals, the regulations and EPA’s recommendations to EPA that address B. Proposed Revisions to the longstanding policy clearly identify the issues regarding the management of Methodology for Determining BACT scope of prohibited preconstruction EPA’s BACT/LAER data base and the activities. The current regulations and process by which BACT or LAER is 1. General Description of the BACT policies remain in effect regardless of determined. Upon evaluation of those Determination Process today’s request for comment. recommendations the EPA is taking Typically, the proposed Major Source Accordingly, EPA today solicits steps, described in this preamble, to Permit Applicant Conducts a BACT comments regarding (1) whether there improve and make more accessible its analysis to be submitted with the permit exists a significant problem with the existing database on BACT and LAER application to the permitting authority. current system, and the specific nature determinations and other technical The analysis includes an evaluation of of such problem(s), and if so, (2) information resources. These the technical feasibility and the energy, whether a broader range of preliminary improvements will not only limit the environmental, economic impacts, and activities should be allowed prior to the costs permit applicants incur in other costs associated with various issuance of a final NSR permit, and (3) identifying and evaluating available alternative control options. The how EPA would implement any controls, but will also facilitate timely applicant includes in its application the approach ultimately adopted. EPA is review of the BACT analysis. The EPA BACT analysis and what it considers to seeking comments regarding the need is also proposing regulatory revisions be the best control technology or system for potential changes to the current that provide a framework for BACT of controlling emissions for the regulations that would allow greater determinations under EPA-approved particular source or project. The flexibility with respect to construction State administered programs and a permitting authority reviews the activities in the case of a proposed specific, reliable and efficacious applicant’s analysis and, after taking modification to the source, while methodology for federally-administered into account the energy, environmental, programs, which would be available for preserving the essential characteristics and economic impacts and other costs, of a preconstruction review program. States to adopt. In proposing these and the public’s views, specifies an The EPA solicits comments on all revisions and taking final action, EPA emissions limitation for the source that, aspects of this issue, including will also discharge certain obligations in the permitting authority’s reasoned comments suggesting specific regulatory arising out of several judicial and judgment, reflects BACT.36 language to implement it. In taking final administrative matters. See section IV.I. action on this proposal, EPA may adopt of this preamble. 2. The Core Criteria specific regulatory language consistent The EPA is also proposing regulatory As noted, BACT requires the adoption with this discussion without further revisions that significantly limit a of an emission limitation based on the public notice. permit applicant’s responsibility to ‘‘maximum degree of reduction...which review new control technologies that are III. Proposed Revisions To Control the permitting authority, on a case-by- developed or emerge after a complete Technology Review Requirements case basis, taking into account energy, permit application has been submitted. environmental, and economic impacts This revision will reduce the number of A. Introduction and other costs, determines is delays associated with evaluating New major emitting facilities and achievable.’’ See section 169(3) of the major modifications proposed in areas emerging control technologies in the post-completeness stage of the designated ‘‘attainment’’ or 36 BACT is defined in section 169(3) of the Act ‘‘unclassifiable’’ under section 107 of permitting process. See proposed as, ‘‘[A]n emission limitation based on the the Act must apply the BACT for each § 51.166(j)(5). maximum degree of reduction * * * which the The CAAAC’s discussions focused permitting authority, on a case-by-case basis, taking pollutant subject to regulation under the primarily on BACT; no specific into account energy, environmental, and economic Act (in addition to other recommendations were made impacts and other costs, determines is achievable preconstruction review requirements). for such facility through application of production concerning the methodology for See sections 165(a)(4) and 169(3) of the processes and available methods, systems, and determining LAER. Therefore, the EPA techniques, including fuel cleaning, clean fuels, or Act. New or modified major stationary is not proposing changes to existing treatment or innovative fuel combustion techniques sources proposing to locate in an area regulations which govern how to for control of each such pollutant.’’ 0Section 169(3) designated ‘‘nonattainment’’ under also provides that in no event may BACT result in determine LAER.35 However, the section 107 of the Act are required to emissions that exceed those allowed by any recommendations and resultant applicable standard established under section 111 meet the LAER.34 See section 173(a)(2) improvements to EPA’s control or 112 of the Act. In addition, if the reviewing of the Act. authority determines that there is no economically The deliberative nature of BACT and, technology information systems, the reasonable or technologically feasible way to to some extent, LAER determinations measure the emissions, and hence to impose an 35 A subsequent proposed rulemaking, for enforceable emissions standard, it may require the has spawned considerable controversy. implementing changes to the NSR regulations source to use a design, equipment, work practice or pursuant to provisions in title I parts C and D of operational standard or combination thereof, to 34 In serious and severe ozone nonattainment the 1990 Amendments, will further update the reduce emissions of the pollutant to the maximum areas, section 182(c)(7) of the Act specifies that control technology requirements at 40 CFR extent practicable. See also existing §§ 52.21(b)(12) BACT may apply in certain circumstances. 51.165(a)(2) to reflect statutory requirements. and 51.166(b)(12). 38272 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Act. The Act confers substantial recognizes that a proposed source alternatives, and the concerns of the discretion on the permitting authority in meeting BACT may nevertheless State and local community that could be establishing BACT. consume substantial increment. The impacted by the source under The State flexibility in weighing legislative history provides that the consideration. Consequently, the EPA relevant factors and determining BACT permitting authority has broad believes a BACT determination should, in any particular circumstance is discretion in deciding how much, if at a minimum, meet two core addressed in the legislative history any, incremental air quality requirements, including (1) all of the associated with congressional adoption deterioration to apportion to a proposed available control systems for the source, of the PSD program in the 1977 source meeting BACT. The legislative including the most stringent, must be Amendments. The legislative history history also indicates that a State has considered in the determination,39 and provides that a central benefit of State discretion to reject a permit application (2) the selection of a particular control flexibility is that it facilitates for a proposed source because of system as BACT must be justified in implementation of the best available impacts the proposed source could have terms of the statutory criteria and controls, allowing for the widespread on the character of the community: supported by the record, and must adoption of improved technologies far This congressional directive enables the explain the basis for the rejection of more quickly than would occur with a State to consider the size of the plant, the other more stringent candidate control uniform standard: increment of air quality which will be systems. However, an applicant The decision regarding the specific consumed by any particular major emitting proposing the most stringent candidate implementation of best available technology facility, as well as such other considerations control alternative need not provide cost is a key one and the committee places this as anticipated and desired economic growth and other detailed information in regard for the area. The balancing of these factors responsibility with the State, to be 40 allows States and local communities to judge to other control options. determined in a case-by-case judgment. It is Today, the EPA is proposing to make recognized that the phrase has broad how much of the defined increment of significant deterioration will be used by any the core criteria described herein the flexibility in how it should and can be minimum requirements for determining interpreted, depending on actual major emitting facility. If, under the design construction location. which a major facility propose [sic], the BACT. The EPA is proposing to codify In making this key decision on the percentage of the increment would in the Federal PSD regulations at 40 technology to be used, the State is to take effectively prevent growth after the proposed CFR 52.21, a specific methodology for into account energy, environmental, and major facility was completed, the State or determining BACT that effectively community could either refuse to permit economic impacts and other costs of the implements the statutory requirements application of BACT. The weight assigned to construction or limit its size. This is strictly a State and local decision; the legislation and the core criteria. See proposed such factors is to be determined by the State. § 52.21(j)(5) and (n)(2)(iii). However, to Such a flexible approach allows the adoption provides the parameters for that decision. of improvements in technology to become Similarly, when an analysis of energy, allow states more flexibility under their widespread far more rapidly than would economics, or environmental considerations own rules for making case-specific occur with a uniform Federal standard. The indicates that the impact of a major facility BACT determinations, EPA is proposing only Federal guidelines are EPA’s individual could alter the character of that community, to insert the core criteria for BACT new source performance standards and then the State could, after considering those impacts, reject the application or condition it determinations into the part 51 PSD hazardous emissions standards, both of regulations. Thus, so long as the core which represent a floor for the State’s within the desires of the State or local 37 community. Flexibility and State judgment criteria are met, these proposed decision. revisions allow for other methodologies The legislative history also indicates are the foundations of this policy. that provide equivalent results with less that an intended benefit of the BACT Accordingly, in adopting the PSD time and effort. See proposed requirement is the minimization of the program, Congress emphasized the § 51.166(j)(5) and (n)(2)(iii). The EPA amount of increment consumed by any importance of thorough and public requests public comment on this single source, thus allowing for greater analysis in PSD decision-making. One of approach and on the proposed core growth in an area: the enumerated purposes of PSD is to criteria. In the long run, the growth potential of assure that any decision to permit these clean areas may be quickly filled increased air pollution in any area to 3. Description of the Federal without a reasonable policy to prevent which PSD applies is made only after Methodology for Determining BACT careful evaluation of all the significant deterioration. The first new source Since late 1987 EPA has built in an area would often absorb the entire consequences of such a decision and recommended a specific process for available air resource, leaving no capacity for after adequate procedural opportunities determining BACT. The future expansion or growth. for informed public participation in the recommendation evolved from a 1986 Under the policy to prevent significant decision-making process. See section deterioration in this bill, the growth options national program audit that identified 160(5) of the Act. should be enlarged. This is because the BACT determinations as a deficient In summary, for a given proposed provision requires that any major source be aspect of the PSD permitting process, source or modification, BACT is not a constructed to utilize the best available and a 1987 EPA permit appeal control technology. This should leave room preordained level of emissions for additional growth.38 reduction, but the result of a 39 An applicant could limit its proposed list of The legislative history describes the determination by the permitting technology alternatives to the most effective control breadth of State discretion in regulating authority based on an analysis of technologies. Consideration of technologies that are significant air quality deterioration in a available control methods, systems, and outdated or are clearly inferior to those in the community. While the legislative techniques. The permitting authority applicants proposed list would not be necessary. The EPA is also proposing in this notice, limits on history recognizes that the BACT establishes an emissions limitation the applicant’s responsibility to consider control requirement helps limit the amount of based on the maximum degree of technologies that have not been demonstrated in increment new sources consume, it also reduction that is achievable in light of practice as of the time a permit application is the circumstances of the individual case determined to be complete. See section IV.D. of this notice. 37 See S. Rep. No. 127, 95th Cong., 1st Sess. 31 taking into account the energy, 40 (1977). The applicant may need to consider collateral environmental, economic impacts and emission increases of hazardous air pollutants 38 Id. other costs of the candidate control under other State programs. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38273 decision.41 The EPA’s recommended consideration where they are In the event that the most stringent methodology for determining BACT is demonstrated to be technically candidate control alternative is shown described in detail in the 1990 Draft infeasible. A demonstration of technical to be inappropriate, due to energy, NSR Workshop Manual 42 and is infeasibility should be clearly environmental or economic impacts and summarized below. documented and should show, based on other costs, the rationale for this finding The first step is to identify, for the physical, chemical, and engineering must be documented for the public emissions unit in question, all principles, that technical difficulties record. See proposed § 52.21(j)(5)(i). ‘‘available’’ control options.43 See would preclude the successful use of Then the next most stringent alternative proposed § 52.21(j)(5). Available control the control option on the emissions unit in the listing becomes the new control options are those air pollution control under review. candidate and is similarly evaluated. technologies or techniques with a The control technology options This process continues until the practical potential for application to the identified as available and technically technology under consideration cannot emissions unit and the regulated feasible are then ranked by overall be eliminated by any source-specific pollutant under evaluation, and which control effectiveness for the pollutant environmental, energy or economic have been ‘‘demonstrated in practice.’’ under review, with the most effective impacts which demonstrate that See proposed §§ 52.21(b)(42) and control alternative at the top. At this alternative to be inappropriate as BACT. (j)(5)(i). Air pollution control point in the analysis, it is initially In summary, under the methodology technologies and techniques include the assumed that the most stringent just described, the most effective control application of production processes and alternative represents BACT pending option not eliminated based on relevant available methods, systems, and the consideration of the source-specific statutory factors is proposed as BACT techniques, including fuel cleaning, energy, environmental and economic for the pollutant and emission unit clean fuels or treatment or innovative impacts, and other costs associated with under review. The EPA believes the fuel combustion techniques for control each control option. See proposed proposed BACT determination of the affected pollutant. See section § 52.21(j)(5)(i). Both beneficial and methodology is a rigorous and reliable 169(3) of the Act. In some adverse impacts should be discussed way of determining a level of control circumstances, inherently lower- and, where possible, quantified. In that conforms with the statutory polluting processes are appropriate for general, the BACT analysis should focus definition of BACT and the core criteria. consideration as available control on the direct impact of the control For this reason the EPA is proposing to alternatives. alternative. codify this methodology in the Federal By proposing that for consideration in Cost is often a major concern of the NSR regulations. The proposed Federal permit applications, technologies owner or operator of the proposed regulations could also serve as a should be ‘‘demonstrated in practice,’’ source and should be included in the template for those States that choose to EPA intends to require consideration of analysis. Both average cost effectiveness incorporate this method into their SIP. technologies in EPA’s RACT/BACT/ and marginal (incremental) cost The EPA requests public comments LAER Clearinghouse (see section III.C. effectiveness should be derived for the on alternative methods for determining of this preamble), technologies control alternatives and considered in BACT. Commenters should explain or identified or required in a regulatory the final decision.44 illustrate how such alternative method context and technologies meeting If the applicant is disposed toward will satisfy the following core criteria minimum operating performance selecting the most stringent emissions proposed in this document: (1) All requirements. The EPA proposes to control alternative in the listing as available control systems for the source authorize limiting consideration of BACT, irrespective of cost, then the must be considered in the emerging technologies that are analysis need only address generation of determination, including the most identified after an application is other air pollutants, e.g., toxic stringent emissions control alternative, complete. This is discussed in more pollutants. See proposed § 52.21(j)(5)(i). and (2) selection of a particular control detail in sections III.D.1. and III.D.2. of If there are no outstanding issues that system as BACT, and the basis for the this preamble. would justify selection of an alternative rejection of the other more effective In the second step, the technical control option, the analysis ends and emissions control systems, must be feasibility of each control option that the results are proposed as BACT. justified in terms of the statutory criteria was identified in step one is evaluated and supported by the record. with respect to the source-specific (or 44 Cost effectiveness is the cost of control divided Specifically, the comments should by the mass of emissions (usually in tons) reduced address how the alternative emissions unit-specific) factors. See by that control. Average cost effectiveness is the proposed § 52.21(j)(5)(i). One or more of cost per ton that would be incurred compared with methodology would provide for the options may be eliminated from baseline controls, (i.e., either uncontrolled or the consideration of energy, environmental, control level that would be required in the absence and economic impacts and other costs. 41 of the major source requirements for which the See ‘‘New Source Review Task Force Report,’’ source is making application). Marginal or See section 169(3) of the Act. Final Draft, Dec. 1986. Honolulu Resource Recovery incremental cost effectiveness is the difference in 4. Additional Guidance for BACT Facility, PSD Appeal No. 86–8 (Remand Order, June cost per ton of emissions reduced at the next most 22, 1987). ‘‘Operational Guidance on Control stringent level of control, when comparing two Determinations Technology for New and Modified Municipal Waste control options. The Federal analytical methodology Combustors,’’ June 26, 1987. ‘‘Improving New The EPA has developed and published detailed Source Review,’’ Memorandum from Craig Potter, procedural information for performing cost outlined above provides for reasoned Assistant Administrator for Air and Radiation to analyses, including average and incremental cost BACT determinations, but it does not EPA Regional Administrators, Regions I–X, effectiveness, in the OAQPS Cost Manual. The December 1, 1987. dictate a particular result. Although the Manual is available through the National Technical progression of the analysis is logical, the 42 See Chapter B of EPA’s 1990 Draft NSR Information Service (NTIS) 5285 Port Royal Road, Workshop Manual for a more detailed description Springfield, Virginia 22161; Phone No. (703) 487– CAAAC suggested that it would be of EPA’s BACT determination policies, including 4807. Government agencies can order it from the helpful for EPA to develop more guidance addressing the consideration of energy, EPA CTC. The EPA has made parts of the Manual detailed guidance addressing how the environmental, and economic impacts. dealing with general cost analysis procedures method actually works in real-life 43 The term ‘‘emissions unit’’ may also represent available as retrievable electronic files on the CTC a process or a system that might collect emissions bulletin board. See also footnote 49 for computer applications. The CAAAC from several discrete pieces of equipment. access information. recommended that the EPA provide 38274 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules guidance in the form of specific Control Technology Center (CTC) to and to provide follow-up verification on examples illustrating (1) how the assist State and local permitting installation and compliance. consideration of energy, environmental agencies in identifying and evaluating • Due to the case-by-case and or economic factors justified new control technologies or control evolutionary nature of BACT, as well as establishing a less stringent control technologies for industrial categories limited Agency resources, EPA does not technology as BACT, and (2) how the that have been previously uncontrolled. intend to implement a recommendation BACT process may properly result in a It maintains a separate bulletin board that the EPA prepare written guidance BACT determination based on control (CTC BBS) that operates in concert with indicating demonstrated technology that technology more stringent than that the RBLC. presumptively should be considered initially proposed by the source. Both bulletin boards, the RBLC and BACT or LAER for certain industries. The EPA agrees that the issuance of the CTC BBS, are useful sources of Nevertheless, EPA will publicize the guidance in the form of illustrative publicly available information on RBLC’s capability to present technology examples would improve understanding control technology determinations, but determinations in rank order (most to of EPA’s BACT determination process. they are not exhaustive. The CAAAC least stringent) for a particular process Therefore, the EPA is preparing a case made numerous detailed and pollutant. The EPA has already study report, containing examples of recommendations for improving the placed such lists for several common BACT determinations properly content and management of the RBLC.46 sources and pollutants in retrievable employing the EPA methodology. The The following discussion explains document files on the RBLC and will EPA’s guidance will examine several several steps the EPA has taken or is periodically update and add to these instances in which a technology less planning to take to improve the control rankings. Process-and pollutant-specific stringent than the most stringent one technology information resources that it rankings can be generated directly by was determined to represent BACT, and manages. users by performing standardized search other instances where the permitting • The EPA is proposing in this and download procedures that are authority imposed BACT requirements rulemaking to require permitting integral functions of the RBLC. • that were more stringent than those authorities to submit BACT and LAER The EPA intends to up-date its proposed by the applicant. This determinations to the RBLC within 60 RBLC users manual to more clearly document will be made available to the days following permit issuance. See explain options and searches available public when it is completed, section VI.C. of this preamble. to users. The manual is available in independent of this proposed action. In • Based on the CAAAC’s hardcopy from the National Technical addition, the existing ‘‘OAQPS Cost recommendation that the RBLC should Information Service (NTIS) of the U.S. Manual’’ provides basic guidance on comprehensively catalog information on Department of Commerce, the CTC (for how to perform cost analyses for air critical data elements for new entries government agencies), or as a retrievable pollution control equipment. See (rather than obtaining missing data for file on the RBLC. The RBLC also offers footnote 45. existing entries), the EPA is considering an informational flyer which, in part, ways to ensure—through better fulfills basic user manual functions. The C. Improving Information about cooperation with permitting authorities flyer is available to anyone free of Available Control Technologies: and private industry—that the RBLC is charge from the CTC 47 and is a Changes to the Reasonably Available complete and comprehensive. The EPA retrievable document file on the RBLC. Control Technology (RACT)/BACT/ intends to focus the RBLC’s resources The EPA will continue to utilize the Lowest Achievable Emission Rate on providing complete and correct CTC and the RBLC as well as other (LAER) Clearinghouse (RBLC) information about new permit available electronic media to The EPA established the original determinations. Data gaps in old disseminate other guidance and computerized database of BACT and determinations will be addressed as technical information such as the LAER determinations (the BACT/LAER resources allow. OAQPS ‘‘Cost Manual.’’ Clearinghouse) at the request of • The EPA has simplified the RBLC’s If fully implemented, the impact and permitting agencies to promote sharing reporting form and limited the scope of the CAAAC’s recommendations of technology determinations in the information in the RBLC. Data fields to expand and improve EPA’s permitting process. The clearinghouse that were of questionable value or have technology information services would was installed on the OAQPS received little use have been deleted. require a substantial increase in Technology Transfer Network (TTN) for These changes are expected to reduce resources. The EPA invites comments convenient public access. The 1990 the burden on permitting agencies and on funding alternatives for the RBLC Amendments now requires the EPA to encourage participation. The EPA has and CTC BB. The EPA also seeks make information regarding emission also prepared a stand-alone program on comments on a strategy for prioritizing control technology available to the computer disk for use by agencies to all or part of the RBLC’s functions if full States and to the general public through submit determinations as an alternative funding is not available. a central database. The 1990 to completing forms and direct data D. Streamlining BACT/LAER Amendments directs that the database entry to the RBLC. Determinations include control technology information • The EPA intends, as resources received from States issuing NSR and allow, to establish standard emission The EPA’s current policy calls for operating permits, which include units for reporting emission limits from consideration of available control techniques, including emerging RACT 45 SIP requirements. See sections all major process categories. • technology, in making BACT and LAER 108(h) and 173(d) of the Act. This The EPA intends, as resources discussion will refer to the database as allow, to implement a process to highlight the most stringent 47 Inquiries may be addressed to: Control the RBLC. The EPA also established the Technology Hotline, Information Transfer Group, determinations reported to the RBLC OAQPS (MD–12), Research Triangle Park, NC 45 The RACT is an acronym for reasonably 27711, Hotline No. (919) 541–0800, OAQPS TTN: available control technology, which applies to 46 July 1, 1994 Letter from Patrick M. Raher to Electronic bulletin board, computer access existing stationary sources located in nonattainment Mary D. Nichols transmitting CAAAC’s telephone number (919) 541–5642; Internet Access: areas. See section 172(c)(1) of the Act. Recommendations for NSR rule reforms. TELNET ttnbbs.rtpnc.epa.gov. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38275 determinations until the time that a (c) Emissions limitations contained in definition of ‘‘demonstrated in practice’’ final NSR permit is issued.48 During the federally-approved implementation is proposed to establish a minimum NSR Reform Subcommittee meetings, plans, excluding emissions limitations operating history to demonstrate the industry representatives expressed established by permits issued pursuant performance and reliability of the new concern about instances when to programs for non-major sources; technology. The EPA believes that a 6- applicants have been required to (d) Permits and standards developed month period is appropriate because consider emerging technologies long under sections 111 and 112 of the Act; this is the maximum amount of time after their applications were prepared and currently allowed for the shakedown but before a final permit was issued. (e) Alternative Control Techniques period for establishing emissions of This practice interposes significant Documents and Control Techniques replacement emissions units in NSR uncertainty in business planning as well Guidelines that have been issued by the netting transactions. See existing as permit delays. For example, permit EPA. §§ 51.165(a)(1)(vi)(F), 51.166(b)(3)(vii) applicants face the risk of having to The EPA is not proposing to require and 52.21(b)(3)(vii). The EPA also substantially redesign a project due to that operating permits issued under believes that the 50 percent continual the emergence of new control federally-approved title V Act programs load factor provides some assurance that technology prior to final permit be among the sources of available the control technology has been placed issuance. Further, there are research and control technology that must be in meaningful service during the 6- related transaction costs, and even examined in preparing a permit month period, while recognizing that project jeopardy, when permit application except where sources are higher loads may not be sustainable by processing is extended while more issued an ‘‘integrated’’ NSR and the source for extended periods of time information about the availability and Operating permit. Title V permits so soon after start-up. achievability of an emerging technology generally compile requirements that are Knowledge of the control technology’s is assessed. independently established under other ability to perform effectively at specified The EPA is today proposing to alter Act programs. Title V programs do not loads is essential for its consideration in its current policy and proposing mandate substantive requirements a BACT or LAER determination. accompanying changes to its NSR concerning the selection, installation Therefore EPA is proposing to add the regulations to address this problem. and performance of control emissions load criteria for testing a These proposed changes strike a balance technologies. Therefore, a title V permit, control technology’s performance between providing more certainty for unless it jointly imposes the substantive during the 6 months in which the industry in making technology choices requirements of a major NSR permit, sustained operability of the technology for planning major projects, and would likely not provide significant is established. This testing requirement ensuring that state-of-the-art new control technology information. is similar to that found under the NSPS, Control technologies that may not be technologies are adequately considered. which requires facilities to conduct implemented in a regulatory context of performance tests within the period 60 1. Permit Applications Must Include a substantive Act program may to 180 days after start-up to determine Analysis of Control Technologies That nevertheless be available for a given compliance with the applicable are Demonstrated in Practice BACT or LAER analysis. For example, standards. See existing 40 CFR 60.8(a). Specifically, the EPA is proposing to sources often install state-of-the-art The EPA requests comment on the require that the BACT analysis or LAER technology in order to be classified as a criteria and rationale described above determination that is submitted with a minor source or to avoid NSR for determining if a control technology permit application consider requirements for major modifications. has been demonstrated in practice. technologies that have been (In this case permitting authorities are Further, EPA is proposing that ‘‘demonstrated in practice.’’ See encouraged to report the technology to consideration of a technology that is proposed §§ 51.165(a)(2)(ii)(A), the RBLC.) Furthermore, new demonstrated in practice outside the 51.166(j)(5)(i), and 52.21(j)(5)(i). The technologies and innovations of existing regulatory context not be required if the proposed regulations define technologies occasionally evolve operation period and performance test ‘‘demonstrated in practice’’ to include without wide publicity in the regulatory concluded less than 90 days prior to the 49 all technologies required and reported arena. Such technologies also deserve date a permit application is complete. consideration. Consequently, the EPA through existing regulatory programs See proposed §§ 51.165(a)(2)(ii)(A), also proposes to define ‘‘demonstrated and those that, while not identified in 51.166(j)(5)(i)(A) and 52.21(j)(5)(i)(A). in practice’’ to include any technology the regulatory arena, meet specific The proposed 90-day period preceding that meets the following criteria: (1) it criteria for determining their availability the date of complete permit application has been installed and operating and appropriateness for consideration in allows time for the installation and continually for at least 6 months on an a BACT or LAER analysis. See proposed performance that is ‘‘demonstrated in emissions unit(s) which has been §§ 51.165(a)(1)(xxviii), 51.166(b)(42), practice’’ to be publicized in trade operating at least at 50 percent of design 52.21(b)(43), and 52.24(f). journals and company newsletters and With regard to regulatory capacity during that period of time; and the results to be examined by the documentation, technologies from the (2) its performance has been verified scientific community. On the other following sources must be considered in during that 6-month period with a hand, having the 90-day period keyed to the BACT or LAER analysis: performance test or performance data the completeness date creates an (a) The EPA’s RACT/BACT/LAER while operating under a load that incentive for the source to resolve Clearinghouse; coincides with either the operation of incomplete applications expeditiously. (b) Major source construction permits the emissions units served by the The following examples illustrate the issued pursuant to parts C (PSD) and D control technology at their PTE, or 90 proposed process. (NSR in nonattainment areas) of title I percent of the control technology’s of the Act; design specifications. See proposed 49 In the case of foreign technology that has been §§ 51.165(a)(1)(xxviii), 51.166(b)(42), installed and operating outside the U.S., the same proposed criteria would apply in determining 48 See J. Seitz memo, ‘‘BACT/LAER Determination 52.21(b)(43), and 52.24(f). The 6-month whether a technology has been demonstrated in Cutoff Date,’’ January 11, 1990. operating requirement within the practice. 38276 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Example A: On June 1 a permit applicant 2. Permitting Authority May Limit the proposal, certain minor source submits an application that is subsequently Consideration of New or Emerging actions, e.g. netting, that in effect shield determined to have been complete on the Technologies After Complete a source from major source permitting date of the submittal. The applicant in this Application requirements would not qualify for less case would be responsible for evaluating all environmentally significant status. In technologies reported or required in a New or emerging technologies are regulatory context as of the date of submittal. those technologies that have been order to make clear the regulatory Those technologies that have been developed but have not satisfied the context for today’s proposed provisions ‘‘demonstrated in practice’’ via the operating criteria to be classified as concerning a cutoff date and and performance criteria specified above, as ‘‘demonstrated in practice.’’ Some NSR informational requirements for public of 90 days prior to June 1st would also have Reform Subcommittee members commenters, the EPA is today proposing to be evaluated. recommended that EPA prohibit any to amend § 51.165 to refer to the existing Example B: On June 1st, a source submits requirements at § 51.161.50 See a permit application. One month later (May consideration of new or emerging technologies identified after the permit proposed § 51.165(a)(7). 1st), the permitting authority determines the The permitting authority shall be application is complete. Other members application to be incomplete. The source responsible for evaluating the recommended that EPA not allow any submits new information on August 1st and supporting documentation that has been the permitting authority finds the application limitations on consideration of new or provided by commenters asserting new complete as of the day the new information emerging technologies prior to the end or emerging technologies warrant was submitted. The applicant would be of the public comment period on a consideration as BACT or LAER. Based responsible for evaluating all technologies permit application. The EPA is reported or required in a regulatory context on the facts that are presented, the proposing new regulatory provisions permitting authority will either accept as of May 1st. Those technologies that have that would authorize the permitting been ‘‘demonstrated in practice’’ via the the recommendation at face value, reject operating and performance criteria specified authority to cut-off consideration of it as being insufficiently demonstrated, above as of 90 days prior to the original technologies that evolve or appear after or refer it to the permit applicant for submittal date would have to be evaluated. the permit application is complete, further consideration. The EPA is also Comment is solicited on the proposed 90-day except under limited circumstances proposing to require the permitting post-demonstration period in light of the 6- described below. See proposed authority to notify the permit applicant month demonstration period within the §§ 51.165(a)(2)(ii)(B) and (a)(7)(iii), within 10 working days of receipt of definition of ‘‘demonstrated in practice.’’ 51.166(j)(5)(iii) and (q)(3) and comments recommending a new 52.21(j)(5)(iii) and (q)(3). technology for which the permitting Finally the proposed regulations The EPA today proposes to add would require, in evaluating control authority determines the comments provision concerning public have met the specificity criteria it has technologies that are demonstrated in recommendations on new and emerging practice under both the regulatory and established relative to the cut-off date. control technologies as part of the new See proposed §§ 51.165(a)(7)(iii), performance-based criteria, the provisions for public participation. consideration of control technologies on 51.166(q)(3) and 52.21(q)(3). This Under the proposed rules, the requirement would provide applicants the basis of technology transfer. permitting authority may require Technology transfer is appropriate when with an opportunity to respond to the commenters to submit a comments and expedite their sources or source categories have recommendation, accompanied by similar emission stream characteristics. investigation relative to the proposed reasonably available information, project. See proposed §§ 51.166(j)(5)(ii) and regarding new or emerging control 52.21(j)(5)(ii). The permitting authority, in technologies. The accompanying determining the extent to which Some industry and State information could include the name and commenters’ recommendations deserve representatives on the NSR Reform location of the source utilizing the further consideration, should consider Subcommittee expressed concern about control technology, the manufacturer the difficulty of private citizens and the administrative delays if a permit and type of control device, the date on small organizations in getting access to application is determined incomplete which the technology was installed and detailed supporting data. If information due to the inadvertent omission from a became operational, appropriate about the emerging technology is BACT or LAER analysis of a technology performance requirements, and any limited, commenters should document alternative that has been ‘‘demonstrated resulting test or performance data their attempts to obtain data about the in practice.’’ For example a technology available. See proposed source and the recommended that has recently been ‘‘demonstrated in §§ 51.165(a)(7)(ii) and 51.166(q)(2). With technology. For example, the practice’’ may have been publicized in regard to the implementation of the commenter may present logs of a less well-known publication, and Federal PSD requirements at § 52.21, the telephone conversations with company thereby escaped notice of the applicant. EPA is proposing to require that public officials and correspondence with trade Certainly, overt disregard of reasonably commenters include the above associations, environmental accessible information would be information along with any associations, government agencies and grounds for determining the application recommendation for further technical consultants that might have to be incomplete. Inadvertent omissions consideration of new control technology relevant information regarding the should be evaluated by the permitting alternatives. See proposed § 52.21(q)(2). availability and effectiveness of the authority in light of case-specific It should be noted that the existing technology. A list of questions that are factors. In all instances, if a technology NSR regulations at § 51.165(a) do not asked and respective responses may be that should have been evaluated is contain an explicit provision for public identified and the permitting authority participation procedures as do the PSD 50 In a separate rulemaking EPA has proposed sustains the completeness finding, there regulations in parts 51 and 52. revising the public review and comment is still a duty to evaluate the omitted Nevertheless, the public participation requirements at 40 CFR 51.161 to give States more flexibility in processing minor source permits for technology relative to the other procedures set forth under § 51.161 projects that are determined to be ‘‘less technology alternatives prior to permit generally apply for both major and environmentally significant.’’ See 60 FR 45529, issuance. minor new source review permitting. In 45549, (August 31, 1995). Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38277 helpful. While this information may not In light of the considerations in the permit review process. The cut- actually demonstrate the availability of described above, the EPA is also off date EPA is proposing to authorize a recommended technology, it will proposing regulatory changes to revise for consideration of new and emerging provide the permitting authority with its policy that sets the permit issuance technology for BACT or LAER, and the information to help determine whether date as the final cut-off for consideration proposed procedures for FLM further evaluation is warranted either by of new and emerging technologies. notification and coordination are its staff or the source. The EPA requests Proposed revisions to the Federal inseparably tied to the completeness comment on the proposed criteria for regulations would set the final cut-off at date. As discussed in this section and in evaluating public comments addressing the close of the public comment period, section V. (Class I Areas), the evaluation the availability of new technologies and unless the permit is reopened for review and determination of whether a permit the appropriate burden of proof that or the source fails to commence application is complete is the commenters should bear after a permit construction within a prescribed time responsibility of the permitting is determined to be complete. period after the permit is issued. authority. Consequently, EPA is Unlike a recommendation to consider The EPA also requests public proposing minimum criteria upon new or emerging technology as comment on alternative regulatory which the permitting authority should discussed above, the identification of a changes that would (1) allow State NSR base its completeness determination. technology alternative that has been programs to wholly preclude Broadly, EPA is proposing that a permit ‘‘demonstrated in practice’’ and should consideration of public comments about application shall contain information have been assessed prior to technology that is new or emerging after necessary to make the demonstrations, completeness, places no burden on the an application is complete; and (2) analyses, and determinations required commenter to supply qualifying provide in the Federal NSR program for under the NSR regulations. See information about the technology. The wholly precluding consideration of proposed §§ 51.165(a)(6), 51.166(n), and permitting authority must ensure that public comments about technology that 52.21(n). the omitted technology alternative is is new or emerging after an application The completeness criteria is derived adequately considered in the BACT or is complete. from applicable existing provisions on LAER determination. The permitting Rules that allow or provide for ‘‘Source information’’ at §§ 51.166(n) authority may be able, however, to entirely precluding public comment on and 52.21(n) that remain unchanged by determine if the alternative is inferior to technology that emerges after a permit this rulemaking, as well as proposed the technology proposed by the application is complete would provide applicant. In all circumstances the greater certainty for business planning revisions and new provisions. In permitting authority would be and have administrative ease and addition, the EPA proposes renaming responsible for considering the simplicity benefits. On the other hand, §§ 51.166(n) and 52.21(n) to ‘‘Complete comments and documenting its such rules would potentially eliminate application criteria,’’ and adding similar associated decisions for the public public input on emerging technologies provisions to § 51.165. Specifically, record. and for go any resulting emission proposed revisions to §§ 51.166(n)(1) The proposed approach for reductions benefits. If EPA did allow or and 52.21(n)(1) assign the completeness considering new or emerging provide for a categorical cutoff of public determination to the permitting technologies promotes certainty and comment addressing technologies authority and indicate the limits permitting burdens for those emerging after an application is determination shall be made upon the applicants that have included a complete, EPA may also need to include presence and adequacy of analyses and thorough review of control technologies an exception that provides for information required under in their permit applications. The consideration of new or emerging §§ 51.166(n)(2) through (n)(5) and proposed regulations would require technologies in circumstances where §§ 52.21(n)(2) through (n)(5), consideration of only those post- substantial time elapses between the respectively. Proposed revisions at completeness emerging technologies completeness determination and final §§ 51.166(n)(2) and (n)(3), and at whose availability and effectiveness are permit issuance (e.g., a permit applicant §§ 52.21(n)(2) and (n)(3), require that the substantiated to the satisfaction of the submits an application that is application contain sufficient permitting authority. determined complete but significant information to substantiate the This proposal also preserves deficiencies that substantially delay following: (1) the BACT opportunity for public participation. In permit processing with the application recommendation pursuant to proposed all instances, the public would have the are discovered during the full permit §§ 51.166(j)(5) or 52.21(j)(5); (2) the right to submit comments addressing review). analyses required by §§ 51.166(k) whether all control technologies that Under all of the alternatives through (m) or §§ 52.21(k) through (m); were, in fact, ‘‘demonstrated in presented, the permitting authority (3) the additional impact analysis practice’’ prior to completeness, were would be required to consider public pursuant to §§ 51.166(o) or 52.21(o); (4) adequately considered in the permit comment addressing whether the determinations and analyses related to application and during review by the technologies available (i.e., the protection of Federal Class I areas permitting authority. In addition, public ‘‘demonstrated in practice’’) at the time pursuant to §§ 51.166(p) or 52.21(p); (5) commenters have the opportunity to the permit is complete were adequately the establishment of PALs under recommend new or emerging evaluated. The EPA seeks public input §§ 51.166(u) or 52.21(x); and (6) technologies provided that on these alternatives and related issues. undemonstrated technology waiver recommendations are accompanied with applications under §§ 51.166(s) and supporting information about the E. Proposed Complete Application 52.21(v), as appropriate. The EPA is existence and capabilities of the Criteria proposing as independent requirements technology. The permitting authority In several of the proposed regulatory for completeness at §§ 51.166(n)(4) and would be required to consider timely and policy changes based on the (n)(5), and §§ 52.21(n)(4) and (n)(5), that and documented public comments consideration of the CAAAC key information from the permit addressing technologies that emerge recommendations, the completeness application be registered on the after completeness. determination has emerged as a key step applicable EPA electronic bulletin board 38278 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules and that FLM review and coordination attractive in PSD areas and, for the first 2. Description of Proposed UT/A Waiver has been provided. time, proposes to add a similar waiver Section 111(j) of the Act provides for The EPA is proposing similar to nonattainment NSR regulations. the issuance of waivers to sources completeness criteria at § 51.165(a)(6) These changes are intended to facilitate which propose the use of control for nonattainment area major source the use of innovative or undemonstrated technology which the Administrator construction permit applications. Under pollution control, prevention, or determines to be innovative. Concerned the proposed provisions, the plan shall reduction technologies in NSR that a source would be able to obtain a require the application to include permitting. section 111(j) waiver but remain subject information pertaining to the LAER, or The utilization of undemonstrated to BACT requirements thus where applicable, the BACT discouraging innovation, the EPA determination, statewide compliance technologies or applications generally involves risk-taking on the part of the incorporated into the PSD regulations a and undemonstrated technology or corresponding ICT waiver. See 45 FR application waiver.51 source, the permitting agency, the public, and the environment. The 52676 (August 7, 1980). However, this The EPA expects that the waiver has not been widely used since demonstration of statewide compliance CAAAC’s NSR Reform Subcommittee and the EPA recognized the risks its adoption 15 years ago. would be met by the owner or operator The CAAAC’s NSR Reform associated with undertaking innovative of the proposed source submitting, with Subcommittee examined the reasons for projects while also recognizing the the permit application, the compliance the ICT waiver’s limited usage and potential benefits to all stakeholders of certifications for all other major developed three possible outcomes, stationary sources that it owns or a well designed and frequently used other than performance as expected, for operates in the State. See section waiver that leads to greater use of the installation of undemonstrated 173(a)(3) of the Act. Title V compliance previously undemonstrated control control technology—that the technology certifications may serve to satisfy this strategies. As a result, the CAAAC performs better than expected; that there demonstration. However, with regard to provided the EPA with a series of is a ‘‘marginal’’ failure; or that there is facilities that have certified detailed recommendations on how the a ‘‘gross failure.’’ The Subcommittee noncompliance or have experienced existing waiver should be recast. The recommended options to reward the noncompliance since the last title V EPA has evaluated the source for incurring the risk of failure, certification, an updated compliance recommendations and proposes to adopt procedures to be taken by the permitting certification may be necessary to many of them. Further, the EPA believes agency in case of failure, and certain air demonstrate statewide compliance. that the following proposal minimizes quality safeguards. By proposing these complete the uncertainty to the source while a. Proposed New Definition and application criteria, EPA is not protecting the environment from Scope. The CAAAC recommended that proposing additional substantive undemonstrated technologies that fail. the EPA replace the existing ‘‘Innovative requirements for either PSD or Control Technology’’ name with the nonattainment NSR permits, but is Specifically, the EPA proposes (1) changing the name of the waiver to term ‘‘UT/A.’’ The CAAAC summarizing the information and recommended the following definition analyses required by the provisions of ‘‘UT/A’’ and changing the definition to expand the environmental for the waiver: ‘‘any system, process, the respective program. Generally, material, or treatment technology that information necessary for purposes of a considerations, (2) adding UT/A provisions for nonattainment area shows substantial likelihood to operate completeness determination is effectively and to achieve either: (a) sources, (3) ensuring FLM consultation described with the substantive greater continuous reductions of air in UT/A decisions for sources in PSD requirements, e.g., see the discussions pollutant emissions than any areas locating near Class I areas, (4) contained in this proposal on BACT, demonstrated system, or (b) comparable establishing reference BACT/LAER protection of Federal Class I areas, PALs emission reductions at lower cost, lower levels in the permit that grandfathers and undemonstrated technology energy input, with lesser non-air waivers. sources out of application of later environmental impacts, or with other demonstrated technologies if the UT/A advantages that are defined and F. Proposed Undemonstrated Control fails, (5) establishing protective Technology or Application (UT/A) mutually agreed on a case-specific basis emission limits in the permit for the to justify the use of UT/A provisions.’’ 1. Introduction duration of the waiver, (6) requiring that In developing the proposed UT/A The EPA proposes to revise the contingency measures be addressed and definition, the EPA has slightly existing Innovative Control Technology established in the application and the modified the CAAAC’s suggested (ICT) Waiver. This provision allows permit, (7) reducing the duration of the definition. See proposed sources to satisfy the BACT requirement waiver, and establishing a limit on the §§ 51.166(b)(19) and 52.21(b)(19). For through the use of innovative control number of UT/A waivers issued for any PSD areas, the Agency proposes to technologies. It is termed a waiver since given UT/A to that necessary to interpret ‘‘comparable emission a source is allowed an extended period demonstrate the performance of a reductions’’ as allowing the UT/A to of time to bring the new technology into technology or application. The EPA is achieve marginally less emission compliance with the required proposing modifications to the existing reductions in the pollutants subject to performance level. The EPA today ICT regulations that reflect the BACT than the otherwise applicable proposes to make the innovative differences in the proposed UT/A BACT. This proposed flexibility allows technology alternative simpler and more approach. Many of the existing a permitting agency to issue a PSD UT/ provisions of §§ 51.166(s) and 52.21(v) A waiver for an undemonstrated 51 The upcoming proposed rulemaking to will remain unchanged. In several technology that achieves somewhat less implement changes to the NSR regulations pursuant instances, the EPA is proposing only than the otherwise applicable BACT to provisions in parts C and D of the Act as minor conforming changes. See amended in 1990 will provide additional detail of emission limit provided that the required information for offset showings and the proposed §§ 51.166(s)(2) and 52.21(v)(2) benefits (i.e., energy, environmental or alternatives analysis. and newly created § 51.165(a)(8). economics) associated with the UT/A Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38279 clearly compensate for the increase in 171(3) of the Act defines LAER as the to §§ 51.166(p) and 52.21(p) proposed in emissions. (As is discussed in the next more stringent of either: (1) The most this document, address these concerns section, the EPA does not believe that stringent emission limitation contained and proposes to retain these provisions such ‘‘comparable’’ emissions in the implementation plan of any State for a UT/A waiver under PSD. reductions can satisfy LAER.) In for such class or category of source; or d. Content of a UT/A Waiver. Based addition, EPA’s proposed UT/A (2) the most stringent emission on the CAAAC’s recommendations, the definition includes undemonstrated limitation achieved in practice by such EPA proposes to revise the existing ICT pollution prevention techniques as class or category of source. The LAER waiver provisions to require that the potentially eligible UT/A candidates. requirement, unlike BACT, does not UT/A waiver contain the emission See also discussion of pollution allow consideration of economic, control performance objective of the prevention issues in section IV.H. of this energy, or other environmental factors UT/A and the otherwise applicable preamble. to compensate for less emission BACT or LAER standard identified in The EPA has made some changes to reductions. Accordingly, it is the UT/A permit for reference, but not the UT/A definition recommended by inappropriate to include in the as enforceable limits during the life of the CAAAC. The EPA is not proposing definition of UT/A for nonattainment the UT/A waiver. See proposed the general catch-all phrase for other areas technologies that achieve only §§ 51.166(s)(5)(i) and 52.21(v)(5)(i). mutually agreed upon advantages comparable emission reductions. With regard to a nonattainment area because it is vague and unnecessary, The EPA is proposing to expand UT/ NSR UT/A waiver, the EPA is proposing and could potentially lead to misuse of A waiver applicability to nonattainment that the undemonstrated technology the waiver. In addition, although the area NSR and require that all applicable comply with the applicable LAER limit. choice of ICT or UT/A is generally a part D requirements (e.g., LAER and See proposed § 51.165(a)(8)(v)(A). mutual agreement between the offsets) are met prior to issuance of a The CAAAC recommended that, in permitting authority and the source, the waiver. See proposed addition to including the otherwise existing ICT rules properly make clear §§ 51.165(a)(1)(xxvi), and 51.165(a)(8). applicable BACT or LAER emission that the source makes the request for an This action supports an Agency limit and the UT/A’s emission limit ICT, and the permitting authority objective, as stated in a June 15, 1993 objective in the permit, the permitting approves or disapproves the request. memorandum from Carol Browner, EPA authority should also establish an upper The EPA is also omitting ‘‘non-air’’ from Administrator, entitled ‘‘Pollution emission limit for the UT/A. Based on the CAAAC recommended UT/A Prevention Policy Statement: New the Subcommittee’s discussions, the definition to allow air-related impacts to Directions for Environmental Agency interprets this recommendation be factored into the decision process Protection,’’ to further pollution as being an enforceable emission limit thus expanding the arena of potential prevention by providing opportunities established by the permitting authority environment impacts that can be for technological innovation. The EPA is and not to be exceeded during the term considered. The EPA solicits comment proposing the recommended UT/A of the UT/A waiver. This issue is on this proposed definition, particularly definition for nonattainment NSR, but discussed further in section IV.f of this on whether any other factors should be replaces ‘‘comparable’’ with ‘‘equal’’ in preamble. included in the definition. The the ‘‘emission reductions’’ language and As recommended by the CAAAC, a proposed PSD definition of UT/A does omits the general, catch all ‘‘other proposed UT/A waiver application and not affect the section 111(j) ICT waiver advantages’’ language for the same permit should include (1) identification for sources seeking a waiver under the reasons EPA declined to use the of potential failure modes, (2) NSPS. language in the PSD context. The EPA projections of corresponding emissions b. Extension to Nonattainment NSR. solicits comment on this definition, increases expected from such failure The CAAAC’s Subcommittee particularly on whether any factors modes, (3) characterization of such recommended that the UT/A waiver be other than those proposed should be failure modes and corresponding extended to major nonattainment NSR, included in the definition. emission increases as marginal or gross in light of the increased number of To provide EPA information on the failures, and (4) identification of sources subject to nonattainment NSR waiver’s utilization and types of potential contingency measures, both after the 1990 Amendments. Many of technologies or applications approved, short- and long-term, to reduce or these sources will be relatively small the EPA is proposing that a copy of the mitigate emission increases in the event (compared to typical pre-1990 major waiver be submitted to the Agency of worse-than-expected emissions nonattainment NSR sources) and may within 30 days of its approval. See during the term of the UT/A waiver. The have relatively unique emission units proposed §§ 51.165(a)(8)(ix) and CAAAC recommended that these which could greatly benefit from 51.166(s)(9). elements be included in the UT/A expanded use of undemonstrated c. Federal Land Manager (FLM) permit and that the potential control technologies and applications. Consultation. As part of the UT/A contingency measures not be construed However, expanding the UT/A waiver waiver approval process, the CAAAC to limit the consideration or use of any to nonattainment area NSR could create recommended that the FLM be other contingency measures that may be a discrepancy between the UT/A consulted before the permitting identified later, if such measure would definition and the statutory definition of authority approves an UT/A waiver better ameliorate worse-than-expected LAER. The recommended UT/A where impacts on Class I area air quality UT/A performance. These projections definition provides that a control or AQRV’s may result from the UT/A and contingency measures would, as for technique may qualify if it achieves source. Existing §§ 51.166(s)(2)(vi) and any NSR permit term, be subject to ‘‘comparable emission reductions.’’ As 52.21(v)(2)(vi) require that before an ICT public notice, comment and review and previously discussed, the EPA interprets waiver can be approved the Class I area approval by the permitting authority. this as allowing the UT/A to achieve protection provisions of §§ 51.166(p) The EPA has evaluated and largely marginally less emission reduction than and 52.21(p) must be satisfied with agrees with the CAAAC’s the applicable emissions level which respect to all periods during the life of recommendations. Thus, the EPA would otherwise be required by the the ICT source or modification. The EPA proposes regulations requiring the major NSR permit. However, section believes these provisions and revisions permitting authority to include in UT/ 38280 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

A approved permits (1) the UT/A’s proposing to provide the permitting some type of PSD emission reduction emission control performance objective authority with the flexibility to define (or emission impact reduction) credit. In and applicable reference BACT or LAER both ‘‘marginal’’ and ‘‘gross’’ failure on regard to the third option, the EPA emission limit and (2) the identification a case-by-case basis. To protect public believes that both the current ICT and and classification of potential failure health, NAAQS and AQRV, the EPA is the proposed UT/A waivers provide the modes and associated contingency proposing that the ‘‘gross’’ failure limit protection envisioned by the measures. See proposed be included in the permit as an Subcommittee, namely a limited shield §§ 51.165(a)(8)(v) (A) and (C), enforceable emission limit that is not to from enforcement during the term of the 51.166(s)(5) (i) and (ii), and 52.21(v)(5) be exceeded during the term of the UT/ UT/A waiver, assuming all applicable (i) and (ii). The EPA also proposes that A waiver. See proposed UT/A requirements are met. However, an application for a UT/A waiver §§ 51.165(a)(8)(viii), 51.166(s)(8) and the proposed UT/A waiver regulations include a detailed description of the 52.21(v)(8). specifically require the permitting continuous emission reduction system The EPA envisions that a ‘‘marginal’’ authority to establish an enforceable and all information used or consulted in failure would be addressed with specific upper emission limit which is not to be applying for a UT/A waiver. See contingency measures, but the source exceeded during the term of the UT/A proposed §§ 51.165(a)(6)(ii)(C), would not need to abandon the waiver. See proposed 51.166(n)(2)(iii) and 52.21(n)(2)(iii). technology. Thus, the permitting §§ 51.165(a)(8)(viii), 51.166(s)(8) and The CAAAC recommended that EPA authority is provided with the flexibility 52.21(v)(8). should allow the initial compliance to either permit the UT/A at its g. Duration and Number of UT/A demonstration requirements to be ‘‘marginal’’ failure emission level or Waivers. The CAAAC recommended revised by mutual agreement within the require the source to install technology that UT/A waiver provisions expire no life of the UT/A provisions. The capable of achieving the appropriate later than 4 years after start of operation CAAAC’s rationale was to allow reference emission limit (i.e., BACT or or 7 years after the initial UT/A permit improvements in the suitability, LAER). See proposed is issued, whichever is earlier, or by any representativeness, repeatability, §§ 51.165(a)(8)(vii), 51.166(s)(7) and earlier date mutually agreed upon by the accuracy, or reliability of emission 52.21(v)(7). The EPA solicits comment parties. As described below, EPA is control performance test results, or for on whether specific definitions of proposing a shorter waiver period. The such other causes as are mutually ‘‘marginal’’ and ‘‘gross’’ failure should EPA is also proposing that upon agreed to justify a revision. Currently a be established by the Agency by rule or expiration of the UT/A provisions, permitting authority has the flexibility guidance. either the initial UT/A emissions limit, to revise compliance demonstration f. Incentives. Recognizing that a very or a revised limit that meets the requirements in a permit as allowed by limited number of PSD ICT waivers requirements for either better-than- applicable law. In addition, EPA is have been requested or approved since expected or less-than-expected currently modifying its title V permit 1980, the NSR Reform Subcommittee emissions control performance, as revision process to allow sources discussed various options for promoting appropriate, would be incorporated into considerable flexibility in making the use of UT/A’s. One option discussed a final permit (i.e. no longer an UT/A changes to existing permit terms. The by the Subcommittee would allow a waiver). The EPA also proposes to EPA expects to allow compliance source to use, bank, or trade the portion require reporting of the final permit demonstration changes in the UT/A of emission offsets of a nonattainment limits to EPA’s RACT/BACT/LAER context consistent with the Title V pollutant that becomes surplus when Clearinghouse. See proposed revision process. the UT/A achieves greater emission §§ 51.165(a)(8) (vi) and (vii), 51.166(s) e. Failure of a UT/A. The reductions than originally anticipated. (6) and (7) and 52.21(v) (6) and (7). Subcommittee acknowledged that the The second option would allow the The EPA is proposing that the UT/A UT/A may fail to achieve its emission permitting authority, on a case-by-case be allowed no longer than 2 years from control performance objective and that basis, in conjunction with the source the time of startup or 5 years from the level of failure may vary thereby and subject to public review, to agree on permit issuance (2/5 years), whichever warranting different types of corrective values of either mass emission is earlier, to achieve the emission action. As described in the preceding reduction credits or emission impact control performance objective on a section, the EPA is proposing reductions in PSD areas in the UT/A continuous basis. See proposed regulations largely consistent with the permit. The third option, applicable to § 51.165(a)(8)(ii)(B), and the amendatory CAAAC recommendations that would both PSD and nonattainment areas, language for §§ 51.166(s)(2)(ii) and require the UT/A permit to include would limit the benefit accruing to the 52.21(v)(2)(ii). This proposal is potential failure modes. Based on the UT/A source to protection from applicable to both PSD and CAAAC’s recommendation, the EPA enforcement of the initial UT/A nonattainment area UT/A waivers. The proposes that potential failure modes be emission limit during the life of the UT/ Agency is proposing a compliance identified as either ‘‘marginal’’ or A waiver. timeframe other than the CAAAC’s ‘‘gross’’ and that emissions levels The EPA agrees that incentives should recommendation due to comments associated with a ‘‘marginal’’ and a be provided to encourage the received during the Subcommittee’s ‘‘gross’’ failure be specified in the development of UT/As and is requesting deliberations that indicated, as a general permit along with the corresponding comment on whether existing policies rule, an UT/A must perform as remedial actions. See proposed (e.g., Emission Trading Policy Statement envisioned within a relatively short §§ 51.165(a)(8)(v)(B), 51.166(s)(5)(ii) and (51 FR 43814) and Economic Incentive timeframe, primarily due to production 52.21(v)(5)(ii). ‘‘Marginal’’ and ‘‘gross’’ Program (59 FR 16690)) provide constraints, or it is replaced with a failure should be expressed as both an sufficient guidance concerning emission conventional control technology. In emission rate (e.g., pounds/hour) and reduction credits thus making specific addition, in order to protect air quality, mass emission limit (e.g., pounds/ UT/A provisions that address credits especially for nonattainment areas, the million British thermal units). unnecessary. In addition, the EPA EPA considers the proposed 2/5 year Recognizing that the installation of each solicits comment on the second option compliance timeframe more appropriate UT/A will be unique, the EPA is identified by the Subcommittee, i.e. than the CAAAC’s recommendation. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38281

The EPA solicits comment on the prevention issues, which were adopted absolute judgment that prevention is allowable length of a compliance by the CAAAC. The CAAAC also always the most desirable option. The schedule to meet the reference BACT or submitted a document from the Agency’s hierarchy is applied to many LAER and on whether the allowable Business Roundtable related to the different kinds of circumstances that length should be longer for BACT than definition of pollution prevention. The will involve judgment. Finally, the for LAER. CAAAC recommended that the EPA Agency distinguishes between The CAAAC recommended that the define pollution prevention consistent prevention and recycling by including number of UT/A waivers approved for with the PPA and that the term what is commonly called ‘‘in-process any given UT/A should not exceed the ‘‘pollution prevention project’’ include recycling,’’ as ‘‘prevention’’ but quantity that the permitting authority ‘‘pollution prevention processes, excluding ‘‘out-of-process recycling.’’ deems appropriate to determine the strategies, or systems,’’ so that the This guidance memorandum further particular UT/A’s emission control concept is not limited to technology. observes that recycling conducted in an performance potential, its capability to In adopting the PPA, Congress found environmentally sound manner shares operate safely and effectively, and its that ‘‘[t]here are significant many of the advantages of prevention in capability to protect health, safety, and opportunities for industry to reduce or that it can reduce the need for treatment welfare. prevent pollution at the source through or disposal, and conserve energy and Section 111(j) of the Act contains the cost-effective changes in production, resources. same language identified by the operation, and raw material use.’’ See 42 U.S.C. sec. 13101(2). The PPA defines 2. Pollution Prevention in BACT and Subcommittee; however, neither LAER existing § 51.166(s) nor § 52.21(v) ‘‘source reduction’’ to mean any practice contain such provisions. While EPA is which (1) Reduces the amount of any The CAAAC recommended that the inclined to allow additional waivers if hazardous substance, pollutant, or EPA issue guidance or regulatory the criteria specified in section 111(j)(1) contaminant entering any waste stream authority allowing consideration of are met, EPA does have reservations or otherwise released into the pollution prevention when determining about reissuing waivers for the same environment (including fugitive BACT or LAER. The CAAAC also system, particularly in nonattainment emissions) prior to recycling, treatment, recommended that the Agency create areas. For both PSD and nonattainment or disposal; and (2) reduces the hazards separate categories of demonstrated and area UT/A waivers, the EPA is to public health and the environment undemonstrated pollution prevention proposing to incorporate the criteria associated with the release of such BACT and LAER. The categories would referenced in section 111(j)(1)(C) and substances, pollutants, or contaminants. include systems, processes, or strategies found in section 111(j)(1)(A) (ii) and (iii) The term includes equipment or expected to achieve either (1) more of the Act. See proposed technology modifications, process or stringent emission levels than §§ 51.165(a)(8)(x), 51.166(s)(10) and procedure modifications, reformulation demonstrated BACT and LAER or (2) 52.21(v)(9). The EPA solicits comment or redesign of products, substitution of comparable emission levels at lower on this proposal. raw materials, and improvements in energy input, lower collateral emissions housekeeping, maintenance, training, or or having cross-media environmental G. Pollution Prevention inventory control. See 42 U.S.C. sec. benefits, or other advantages that are 1. The Pollution Prevention Act (PPA) 13102(5)(A). The PPA expressly defined and mutually agreed upon to justify the pollution prevention and the EPA’s Pollution Prevention provides that the term ‘‘source approach. Both demonstrated and Policies reduction’’ does not include any practice which alters the physical, undemonstrated pollution prevention In 1990 Congress passed the PPA chemical, or biological characteristics or BACT would take cost into account. which established as national policy the volume of a hazardous substance, The Agency examined whether ‘‘that pollution should be prevented or pollutant or contaminant through a existing regulations provide permitting reduced at the source whenever feasible; process or activity which itself is not agencies with the flexibility to consider pollution that cannot be prevented integral to and necessary of the pollution prevention techniques in their should be recycled in an production of a product or the providing analysis of control options. The Act environmentally safe manner, whenever of a service. See 42 U.S.C. sec. defines ‘‘best available control feasible; pollution that cannot be 13102(5)(B). Under the PPA, recycling, technology’’ as ‘‘an emission limitation prevented or recycled should be treated energy recovery, treatment, and disposal based on the maximum degree of in an environmentally safe manner are not included within the definition of reduction of each pollutant subject to whenever feasible; and disposal or other pollution prevention. regulation under the Act emitted from release into the environment should be In the May 28, 1992 EPA pollution or which results from any major employed only as a last resort and prevention policy memorandum, the emitting facility, which the permitting should be conducted in an Agency provided guidance on authority, on a case-by-case basis, taking environmentally safe manner.’’ See 42 incorporating pollution prevention into into account energy, environmental, and U.S.C. sec. 13101(b). In subsequent the Agency’s ongoing programs. The economic impacts and other costs, correspondence (memorandum dated guidance provides that the selection of determines is achievable for such May 28, 1992, from Hank Habicht III, a pollution prevention option, in any facility through application of EPA Deputy Administrator, to all the given situation, depends on the production processes and available EPA personnel and memorandum dated requirements of applicable law, the methods, systems, and techniques, June 15, 1993, from Carol Browner, EPA level of risk reduction achieved, and the including fuel cleaning, clean fuels, or Administrator, to all the EPA cost-effectiveness of that option. In treatment or innovative fuel combustion personnel), the EPA provided guidance addition, the policy provides that the techniques for control of each such on interpreting the PPA and integrating Agency’s environmental management pollutant.’’ See section 169(3) of the pollution prevention into the Agency’s hierarchy is as follows: (1) Prevention, Act. activities. (2) recycling, (3) treatment, and (4) The Agency interprets the phrase The Subcommittee developed several disposal or release, should be viewed as ‘‘production processes and available draft recommendations on pollution a set of preferences, rather than an methods, systems and techniques’’ in 38282 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules the statutory BACT definition to control options. With respect to a Reilly, No. 89–1428 (D.C. Cir. filed July encompass pollution prevention separate category for undemonstrated 10, 1989); API v. Reilly, No. 89–2030 techniques. Existing §§ 51.166(b)(12) pollution prevention options and as (D.C.C. filed July 18, 1989). The District and 52.21(b)(12) incorporate the BACT discussed in the UT/A waiver section, Court action was dismissed on January definition into PSD regulations. The the EPA considers all undemonstrated 5, 1993 for lack of subject matter EPA solicits comment on any potential control options, including pollution jurisdiction. revisions or new provisions in the PSD prevention, to be eligible to qualify for A consortium of utilities filed a regulations that would further facilitate this waiver. Thus, because the Agency similar petition for review of the EPA’s consideration of pollution prevention interprets BACT and LAER to allow for actions, Alabama Power Co. v. EPA, No. techniques. demonstrated and certain 89–1429 (D.C. Cir. filed July 11, 1989), Any major stationary source or major undemonstrated pollution prevention and the case was consolidated with the modification locating in an area techniques and because EPA is pending API case in the D.C. Circuit. On designated nonattainment pursuant to proposing to explicitly provide that February 1, 1990, the Utility Air section 107 of the Act is required to undemonstrated pollution prevention Regulatory Group submitted an meet LAER. See, e.g., sections 172(c)(5) techniques may qualify for a UT/A administrative petition concerning the and 173 of the Act. The LAER is defined waiver, the EPA does not believe it EPA’s policy and practice on BACT as the more stringent of (1) the most necessary to create a separate and determinations. The API also challenged stringent emission limitation contained unique category for either demonstrated a 1990 draft guidance document by the in the implementation plan of any State or undemonstrated pollution prevention EPA on top-down BACT, API v. Reilly, for such class or category of source, control options. No. 90–1364 (D.C. Cir. filed July 13, unless the owner or operator Finally, EPA notes that it has 1990). demonstrates that such limitations are addressed pollution prevention All of these judicial and not achievable; or (2) the most stringent elsewhere in this document. In section administrative matters were resolved by emission limitation achieved in practice II.E. of this preamble, EPA proposes to a settlement agreement in which the by such class or category of source. See include pollution prevention projects in EPA agreed to publish, by January 6, section 171(3) of the Act. In general, the the proposed pollution control project 1992, a proposed rule ‘‘to revise or LAER requirement is based on whether exclusion. The EPA also proposes an clarify the regulations defining BACT’’ an emission limitation is achievable accompanying definition of pollution and ‘‘to revise or clarify how BACT and, unlike BACT, does not provide for prevention based on the PPA and EPA’s determinations should be made.’’ See 56 consideration of economic, energy, or pollution prevention policies. See FR 34202 (July 26, 1991) (request for other environmental factors on a case- proposed §§ 51.165(a)(1)(xxix), public comment on proposed by-case basis. The Agency has 51.166(b)(43), 52.21(b)(44), and 52.24(f). settlement). The EPA also agreed to take interpreted the LAER definition as H. States’ Discretion To Adopt or final action on the proposed rule as including any method of emissions Enforce More Stringent Requirements expeditiously as practicable. In the reduction provided it achieves the event the EPA did not take the specified The regulatory revisions proposed in lowest emission rate feasible. Thus, for action, the parties’ sole and exclusive this action represent minimum Federal nonattainment area purposes, pollution remedy under the express terms of the requirements under the Act. States prevention techniques can be settlement agreement was to reactivate retain full discretion to adopt or enforce considered as a control option; however, the underlying litigation. more stringent air quality protection the techniques must achieve the same This publication of proposed rules requirements consistent with section emission rate as otherwise applicable revising and clarifying the BACT 116 of the Act. LAER. regulations and how BACT After review of the Subcommittee’s I. Addressing the EPA’s Obligation determinations should be made triggers deliberations, the CAAAC’s under Pending Settlement Agreement certain obligations by the other parties recommendation and public comment, to the settlement. The EPA’s final action the EPA believes that current PSD and The ‘‘top-down’’ process, the on the proposed rules will discharge all nonattainment NSR regulations, methodology described in section IV.B. of its remaining obligations under the combined with today’s proposed of this preamble, is the EPA’s settlement agreement and require the version of UT/A waivers, provide the recommended approach for determining dismissal or withdrawal of the permitting agencies with the flexibility BACT and is based on the EPA’s remaining judicial and administrative to consider pollution prevention interpretation of existing statutory and matters described above. techniques when considering either regulatory requirements. On March 29, BACT or LAER control options. Thus, 1989 (supplemented on May 3 and 10, IV. Class I Areas the EPA does not find that additional 1989), the American Paper Institute and regulatory authority is necessary. The the National Forest Products A. Introduction EPA solicits comment on this view and Association (collectively ‘‘API’’) The EPA is today providing guidance any suggested rule changes to facilitate petitioned the EPA to rescind the top- and proposing a number of revisions to the consideration of pollution down policy and initiate a rulemaking the PSD regulations at 40 CFR 51.166 prevention in NSR permitting. on BACT determinations. The EPA and 52.21 to address the protection of The Agency also reviewed the denied this request on May 12, 1989 air quality and air quality related values CAAAC’s recommendation to create (supplemented on June 13, 1989), in Class I areas. In many instances, separate categories for demonstrated explaining that the top-down approach where it has been deemed appropriate, and undemonstrated BACT and LAER was neither at variance with, nor a the EPA is taking action consistent with, control options in regard to the UT/A revision of, the PSD regulations, and or similar to, the CAAAC’s waiver. As discussed above, the that no rulemaking was required. recommendations. Agency’s interpretation of the Subsequently, API filed suit in the U.S. In general, the EPA is proposing definitions for BACT and LAER provide Court of Appeals for the District of several changes to better facilitate State for the inclusion of pollution prevention Columbia and in the U.S. District Court notification and coordination with the techniques when considering available for the District of Columbia. API v. FLM and to provide the States, permit Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38283 applicants and FLM with clearer country were initially designated as The FLM have sought to protect guidance about their relative roles and Class II areas in accordance with section Federal Class I areas by, among other responsibilities. The EPA is proposing 162(b) of the Act. Federal lands not efforts, identifying concerns about the ‘‘significant impact levels’’ for Class I already designated as Class I areas potential impacts associated with increments that would exclude under section 162(a) may be emissions from new source growth. In proposed sources with de minimis redesignated as Class I areas. See section their attempts to protect these lands, ambient impacts from the requirement 164 of the Act. FLM have indicated that their failure to to conduct comprehensive Class I The FLM and the Federal official receive timely notice of relevant permit increment analyses and enable the charged with direct responsibility for applications has undermined their permitting authority to determine that management of any Federal lands ability to exercise their affirmative the emissions from such source would within a Class I area have an responsibility to protect Class I areas not contribute to an increment violation. ‘‘affirmative responsibility’’ to protect and that permitting authorities have The EPA is also establishing a general the AQRV (including visibility) of such given insufficient weight to concerns of policy, and proposing regulatory lands.53 See section 165(d)(2)(B) of the FLM. Permit applicants have language, allowing the use of offsets to Act. The FLM protects AQRV through a complained that EPA’s existing mitigate adverse impacts on AQRV in prescribed statutory role in assessing the regulations are unclear and that there is Federal Class I areas. This policy will potential impacts of a proposed PSD confusion and uncertainty about the provide a reasonable way to allow the source. See section 165(d)(2)(C) of the PSD permit requirements related to the permitting of sources that would Act. If a proposed source does not cause protection of AQRV in Federal Class I otherwise face permit denial because of or contribute to a violation of a Class I areas. Moreover, permitting authorities their adverse impact on AQRV. The EPA increment, the FLM may, nevertheless, examining permit applications in the is also proposing several clarifications demonstrate to the satisfaction of the face of objections by FLM have to its PSD regulations where confusion permitting authority that the source will complained to the EPA about the lack of about a requirement has created have an adverse impact on AQRV in a guidance on Class I area protection and controversy or impeded more specific Federal Class I area and, if so the consideration that should be given expeditious permit review. demonstrated, the PSD permit shall not to an FLM’s concerns. The EPA’s proposal, described below, attempts to B. Background be issued. Conversely, if the proposed source will cause or contribute to a address these various concerns and, 1. Overview of PSD Requirements for violation of a Class I increment, then the thereby, improve the PSD permitting Class I Areas owner or operator must demonstrate to process. The PSD program applies to ‘‘PSD the satisfaction of the FLM that there C. The EPA Proposal areas’’—areas designated as will be no adverse impact on AQRV. See ‘‘attainment’’ or ‘‘unclassifiable’’ sections 165(d)(2)(C) (ii) and (iii) of the 1. Defining AQRV and Determining pursuant to section 107 of the Act.52 A Act. Adverse Impacts fundamental aspect of the PSD program 2. The Need To Improve PSD Permit The Act and the existing PSD is an assessment of a proposed source’s Requirements Related to the Protection regulations are silent in explaining what impact on the amount of air quality of Air Quality Related Values (AQRV) in an AQRV (other than visibility) is, what deterioration that is allowed within a Federal Class I Areas procedures should be followed for particular PSD area. All PSD areas are defining an AQRV, and what criteria categorized as either Class I, II or III. See Over the past several years Congress, should be used for setting critical section 162 of the Act. The classification the FLM, and others increasingly have pollutant loadings for determining of an area determines the corresponding expressed concern about the effects of whether an adverse impact on AQRV ‘‘maximum allowable increases’’ of air air pollution being observed and would occur. The EPA is proposing to quality deterioration (‘‘increments’’) for documented in Federal Class I areas, as add general definitions for the terms that area. See section 163 of the Act. well as the failure of Act programs to ‘‘AQRV’’ and ‘‘adverse impact on Only a relatively small increment of air adequately protect Federal Class I areas AQRV.’’ In addition, the EPA is quality deterioration is permissible in from such effects. The U.S. General clarifying the role and responsibilities of Class I areas and, consequently, these Accounting Office has issued reports the FLM in the PSD permitting process. areas are afforded the greatest degree of addressing these issues.54 a. Definitions. The EPA is proposing air quality protection. to add definitions of ‘‘air quality related The PSD program provides an 53 The ‘‘FLM’’ is defined as the Secretary of the value’’ and ‘‘adverse impact on air department with authority over such lands, i.e., additional layer of special protection for Department of the Interior and Department of quality related values’’ to both sets of Federal Class I areas. See section Agriculture. See Act section 302(i). It should be PSD regulations. As noted, the Act is 165(d)(2) of the Act. Mandatory Federal noted that FLM authority has been delegated to silent in defining AQRV other than Class I areas are national parks greater other officials within these Departments. For visibility. However, the legislative example, the Assistant Secretary for Fish and than 6,000 acres in size, national Wildlife and Parks is the FLM for areas under the history provides the following: wilderness areas greater than 5,000 jurisdiction of the National Park Service and U.S. [T]he term ‘‘air quality related values’’ of acres in size and other areas specified in Fish and Wildlife Service. In today’s notice, the Federal lands designated as class I includes section 162(a) of the Act. These Federal EPA is proposing to clarify the definition of ‘‘FLM’’ the fundamental purposes for which such Class I areas are mandatory in that they to reflect the FLM’s authority to designate another lands have been established and preserved by official to act on his or her behalf with respect to the Congress and the responsible Federal may not be redesignated as any other Federal Class I areas. See proposed sections classification. All other PSD areas in the 51.166(b)(24) and 52.21(b)(24). agency. For example, under the 1916 Organic 54 See U.S. General Accounting Office Report to Act to establish the National Park Service (16 52 Areas having air quality that meets the national the Chairman, Environment, Energy, and Natural ambient air quality standards (NAAQS) are Resources Subcommittee, Committee on before the Environment, Energy and Natural designated ‘‘attainment,’’ and areas for which there Government Operations, House of Representatives, Resources Subcommittee, Committee on is insufficient information to reach a conclusion ‘‘Air Pollution: Protecting Parks and Wilderness Government Operations, House of Representatives, about their air quality status are designated from Nearby Pollution Sources’’ (February 7, 1990) ‘‘Air Pollution: Regional Approaches Are Needed to ‘‘unclassifiable’’ in accordance with procedures set reprinted in 136 Cong. Rec. S2879–2880 (March 21, Protect Visibility in National Parks and Wilderness forth in section 107 of the Act. 1990); U.S. General Accounting Office Testimony Areas’’ (April 29, 1994). 38284 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

U.S.C. 1), the purpose of such national park from a proposed major source or major Class I areas and AQRV, sensitivities of lands ‘‘is to conserve the scenery and the modification.56 Moreover, a critical receptors, and the unavailability natural and historic objects and the wildlife determination of whether a source will of data in many cases, the EPA believes therein and to provide for the enjoyment of have an adverse effect must consider the that the FLM must have sufficient the same in such manner and by such means as will leave them unimpaired for the AQRV specifically identified by the latitude to address these issues on an enjoyment of future generations.’’ FLM and, for each affected AQRV, the area-by-area, as well as a permit-by- projected impact of the emissions from permit, basis. At the same time, the EPA S. Rep. No. 127, 95th Cong., 1st Sess. 36 the proposed PSD source on the existing encourages FLM to identify AQRV on a (1977). regional or national basis where The EPA proposes to define ‘‘AQRV’’ background air quality (including the appropriate, and to establish general as a scenic, cultural, physical, predicted impacts of recently-permitted procedures for identifying AQRV. biological, ecological, or recreational sources not yet in operation) in the Class I area.57 Thus, the FLM’s c. Role of the FLM in Triggering a resource which may be affected by a Class I Area Analysis. It is generally change in air quality, as defined by the demonstration of adverse impact on AQRV, may consider a source’s impact agreed that not all sources applying for FLM for Federal lands and as defined by PSD permits should have to provide a State or Indian Governing Body for on existing conditions, which may already be regarded as ‘‘adverse.’’ The information concerning potential Class I nonfederal lands within their respective area impacts. Various factors concerning jurisdictions. See proposed adverse impact demonstration is also discussed in section IV.C.2.d. of this a particular source, including the type §§ 51.166(b)(40) and 52.21(b)(41). The and amount of its emissions, and the proposed definition addresses the preamble. The proposed definition also source’s distance from the Class I area, fundamental purposes for which such will influence whether the emissions lands have been established and recognizes that the term ‘‘adverse impact on air quality related values’’ has from a proposed source have the preserved. The proposed definition also potential to adversely impact a Class I recognizes that (1) The FLM have the special meaning under the Act that is properly limited to Federal Class I areas. area. This proposal links the responsibility to identify AQRV for requirement for a permit applicant to Federal lands, and (2) the Act gives See section 165(d) of the Act. As described previously, permits must be provide Class I impact information with authority to States and Indian the filing of a notice by the FLM (or Governing Bodies to identify AQRV for denied to sources whose emissions would have an adverse impact AQRV in certain other government officials) areas within their respective which (1) alleges that emissions of a jurisdictions.55 The EPA is proposing to a Federal Class I area, even though no violation of a Class I increment would particular pollutant from a proposed define ‘‘adverse impacts on air quality major emitting facility may cause or related values’’ as a deleterious effect on result from those emissions. b. Role of the FLM in Defining contribute to a change in air quality in any AQRV defined by the FLM, a particular Class I area, and (2) resulting from the emissions of a Specific AQRV. In general, the EPA explicitly recognizes that FLM have identifies the potential adverse impact proposed source or modification, that of such change in air quality on each interferes with the management, special expertise and knowledge about the Federal Class I areas which they affected AQRV. The proposal is protection, preservation, or enjoyment consistent with section 165(d)(2)(C)(i) of of the AQRV of a Federal Class I area. manage. In addition, the EPA agrees with the CAAAC’s recommendation that the Act which provides that once such See proposed § 51.166(b)(41) and a notice is filed a permit shall not be § 52.21(b)(42). Under the part 52 PSD the FLM should be expressly recognized as having the primary responsibility for issued unless the applicant regulations, the proposed definition demonstrates that its proposed would be in addition to the existing the identification of specific AQRV. The EPA believes that it is emissions will not cause or contribute to definition of ‘‘adverse impact on a violation of the Class I increments. See visibility’’ [§ 52.21(b)(29)] which is appropriate not to propose regulations that would dictate how the FLM proposed §§ 51.166(p)(2)(i) and derived from the EPA’s visibility 52.21(p)(2)(i). The proposal also is in regulations adopted pursuant to the identify AQRV (and associated critical pollutant loadings) or demonstrate an accordance with the provisions under Act’s visibility protection program. See section 165(e)(3)(B) of the Act which existing 40 CFR 51.301(a) and 51.307. adverse impact on AQRV. These responsibilities are closely tied to the require, for a proposed source, an Under the Federal PSD requirements, analysis of the ambient air quality, EPA intends that the definition of role of the FLM mandated by the Act, and are also integral to the management climate and meteorology, terrain, soils ‘‘adverse impact on visibility’’ continue and vegetation, and visibility, at the site to be used when the AQRV of concern of those AQRV under the mandates of the Federal Lands statutes as well (e.g., of the proposed source and ‘‘in the area is visibility. The new definition is potentially affected by the emissions intended to encompass all AQRV. Wilderness Act, 16 U.S.C. 1131 et seq., and 1916 National Park Service Organic from such facility.’’ The proposed definition of ‘‘adverse The permitting authority would impact on air quality related values’’ Act, 16 U.S.C. 1 et seq.) Furthermore, because of the wide variety of Federal determine the status of the Class I includes the requirement that such increments considering, as appropriate, determinations be made on a case-by- the analysis provided by the applicant. 56 In determining whether emissions from a case basis, considering the change in The analysis of potential impacts on existing air quality that will result from proposed source would present an adverse impact, the effects of hazardous and toxic pollutant Class I area resources will help provide the emissions of a particular pollutant emissions should be considered in the analysis if the basis for an eventual determination they are constituents of any criteria pollutant of whether the source will have an 55 Section 164(e) of the Act provides for EPA emitted in ‘‘significant’’ amounts by the source. protection of AQRV when the EPA is requested to 57 In a previous rulemaking, EPA determined that adverse impact on AQRV. The EPA resolve a dispute between a State and Tribe about an assessment of whether a proposed source would generally believes that the combined the redesignation of an area or a proposed PSD cause an adverse impact on visibility requires the informational requirements contained in permit. The reader is also referred to the discussion permitting authority to review the new source’s this proposed provision will greatly in section IV.C.5 of this preamble, where EPA impact in the context of background impacts caused clarifies its position concerning the authority of by both existing and previously permitted (not yet facilitate resolution of AQRV issues States and Indian tribes to establish AQRV for their constructed) sources. See 50 FR 28548 (July 12, which must ultimately be addressed as respective lands. 1985). a prerequisite to permit issuance. That Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38285 is, the analyses will reveal whether the The EPA encourages, particularly though there is no potential that the Class I increments will be violated; where a source proposes to locate proposed source will have an adverse establish the relative roles of the within 100 kilometers of a Federal Class impact on the area. Conversely, sources applicant; the FLM and the permitting I area, the applicant to coordinate with proposing to locate more than 100 authority in making decisions the FLM prior to the submittal of its kilometers from a Federal Class I area concerning the AQRV; and provide application in order to be able to learn that may nevertheless adversely impact information needed to determine of any FLM concerns and to submit the a Class I area would not be required to potential AQRV impacts. Moreover, this Class I analyses along with the other carry out the appropriate Class I proposal would limit an applicant’s required information in its initial permit analyses. Thus, a rigid distance cutoff responsibility to perform Class I area application. Otherwise, the FLM would would still need some kind of assessments to circumstances where be expected to file the notice alleging accompanying triggering mechanism to there is an identified potential that the potential affects on the Federal Class I establish the informational requirement proposed source will have an adverse area, where appropriate, during the 30- for Class I impacts for potential sources impact on a Class I area. day period for review of the application of concern locating beyond any If the proposed source will cause or for completeness, as provided under specified cutoff distance. The EPA is contribute to a violation of a Class I this proposal and described in section interested in alternative approaches increment, the applicant will provide IV.C.2.c of this preamble. In the absence which will establish a reasonable information pertaining to the source’s of a notice being filed concerning requirement for Class I analyses at a impacts on, as appropriate in light of the potential Class I impacts, the applicant reasonable point in the permit process. FLM’s notice, such things as soils, will still be required to demonstrate that With regard to the notice, the EPA vegetation and visibility to demonstrate emissions from the proposed source do believes that it should be in writing, that there will be no adverse impact on not cause or contribute to any violation preferably in the form of a letter to the the potentially affected AQRV identified of the Class II increments or NAAQS. permitting authority, and should by the FLM. See section 165(d)(2)(C)(iii) This proposal to require the applicant address at a minimum (1) the specific of the Act. If the FLM agrees with this to complete a comprehensive Class I pollutant emissions from the proposed demonstration, and so certifies, the impact analysis is tied directly to the source that may cause or contribute to permitting authority may issue the PSD filing of a notice (alleging potential a change in air quality in the specified permit even though a violation of a adverse impacts) prior to the permitting Federal Class I area, and (2) the authority’s issuance of its completeness potential adverse impact of such change Class I increment has been shown. determination. However, this proposal on each specified AQRV. While the Alternatively, when the applicant’s is not intended to preclude the FLM alleged change in air quality and analysis shows, to the satisfaction of the from raising new concerns about effects potential impacts are naturally permitting authority, that the proposed at a later time during the permit review. preliminary, and perhaps somewhat source will not cause or contribute to a The FLM may ultimately submit a speculative, the intent is that the violation of a Class I increment, the demonstration of adverse impact on allegation should present a potential information pertaining to impacts on the AQRV even if a notice has not been linkage between the proposed source— potentially affected AQRV identified by previously filed. In such cases, where based on its specific pollutant emissions the FLM will help the FLM determine additional information is needed to and its relative location to the affected if the proposed source will have an enable the FLM to make the necessary Class I area—and the specified AQRV in adverse impact on AQRV, and to make demonstration, the EPA believes that the affected Federal Class I area as to a demonstration of such adverse impact the permitting authority has discretion warrant the required Class I analysis. to the permitting authority, where to determine whether, and to what The notice is also intended to provide appropriate. extent, the applicant should be required the applicant with sufficient While the Act is silent concerning the to produce the additional information. information to focus the required Class timing for filing the notice of potential The EPA requests comments on this I analysis on the appropriate pollutant adverse impacts, the EPA believes that aspect of the proposal in light of the emissions and AQRV of concern to the it is reasonable and appropriate to importance of having to file a notice FLM. Accordingly, the notice should require the FLM or other named officials alleging potential Class I impacts in not be used by the permitting authority to file the notice before the permitting order to trigger the applicant’s for any prejudgment as to whether any authority issues its completeness responsibility to perform an analysis of potential effects on AQRV will be determination on the permit its Class I impacts. The EPA has adverse. If it is plausible that a source application. See proposed considered alternative approaches for may impact the affected Class I area, §§ 51.166(p)(2)(i) and 52.21(p)(2)(i). One triggering the Class I analysis, including further analysis should generally be reason for this proposal is that the filing a mandatory Class I analysis for any performed. The only basis for rejecting of the notice establishes certain proposed major source or major such notice, and thereby determining informational requirements which serve modification proposing to locate within that a Class I analysis is not required, is as a measure of the application’s 100 kilometers, or some other specific that the permitting authority finds no completeness. Moreover, it is generally distance, from a Federal Class I area. potential linkage between the proposed important that EPA require that the The proposed approach is consistent source’s potential impact (i.e., change in notice be filed early in the permit with the Act requirement for the filing air quality in the Class I area) and the process to expedite permit review. A of a notice. AQRV identified by the FLM. requirement for early notice submittal With respect to alternative approaches An important related issue concerns helps ensure that the Class I area issues not proposed, a rigid distance-based test the responsibility for carrying out any are identified by FLM and other officials may necessarily be either over- or additional technical analyses which early in the permit process and enables under-inclusive. For example, if a cutoff may be necessary for the FLM to the applicant to provide the appropriate of 100 kilometers was established, some demonstrate that a source’s emissions Class I analyses in a timely manner so sources locating within 100 kilometers will have an adverse impact on AQRV. as not to delay the review and issuance from a Federal Class I area may be The EPA generally expects the analyses of the permit. required to perform an analysis even performed by the applicant under the 38286 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules proposed provisions to enable a FLM to d. Informational Responsibilities of clearinghouse is described in section evaluate the impacts on AQRV. In some the FLM. The EPA believes that a logical IV.C.6 of this preamble. cases, however, additional information adjunct of an FLM’s expertise and 2. Improving Federal Land Manager may be necessary to make a thorough responsibility for protecting the AQRV (FLM)/Permitting Authority AQRV assessment and there is a of Federal Class I areas and identifying Coordination question as to who should bear the a potential adverse impact on AQRV is responsibility for such information. the responsibility to provide relevant The CAAAC recommendations Applicants for PSD permits are typically information to persons involved in the reflected general agreement that better required to provide information and permitting process. Permitting State and FLM coordination is integral analyses necessary for the permitting authorities and permit applicants to avoiding delays and controversies authority to make a variety of ambient should have access to any information during the PSD permitting process. air quality decisions because, among concerning AQRV which an FLM has Accordingly, the EPA is proposing a other reasons, applicants have detailed defined for any Federal Class I areas that general provision which requires that knowledge about the proposed source’s may be affected by a proposed source or the permitting authority provide for emissions and operations. Yet, modification. To address this concern, consultation and coordination with the applicants should not necessarily be the EPA is proposing that the FLM be FLM. See proposed §§ 51.166(p)(2)(iii) expected to conduct an unlimited required to provide pertinent and 52.21(p)(2)(iii). The permitting number of studies. The permitting information, where available, to PSD authority is expected to use its judgment authority should ultimately determine, permit applicants upon request. See in deciding the appropriate measure of based on consultation with the FLM, proposed §§ 51.166(p)(2)(ii) and consultation and coordination that will what additional information collection 52.21(p)(2)(ii). ensure adequate input from the FLM as should be required of the applicant. Specifically, the proposal would well as adequate consideration of the The EPA solicits public comment on benefit the owner or operator of a FLM’s expertise and findings this issue in order to establish an proposed facility that may have an concerning potential Class I area equitable approach for completing the adverse impact on AQRV in a Federal impacts. While this particular provision required analyses for Class I areas Class I area. The proposed regulations affords the permitting authority applicable to individual PSD permit generally call for the FLM to provide all flexibility in determining the applicants. Specifically, the EPA seeks available information about relevant appropriate level of interaction with the input in determining what the AQRV and methods for analyzing FLM throughout the permitting process, respective responsibilities of the FLM potential impacts on those AQRV when the EPA also believes that certain and the permit applicant should be for the applicant requests such information. specific points of consultation and carrying out the analyses necessary to This information would include a coordination, as described below, are enable the FLM to demonstrate an current listing of the AQRV, sensitive needed to ensure that the FLM is given adverse impact on AQRV. The EPA will receptors and critical pollutant loadings adequate opportunity to carry out the consider such input and decide whether for each AQRV, as well as the methods responsibilities conferred on the FLM the regulations should explicitly and tools (e.g., models) available to by the Act. address these individual roles. analyze the potential impacts for the a. Pre-application Coordination. The This proposal also recognizes that the affected Class I area. The FLM also EPA is today proposing to require that FLM is not the only official authorized would be expected to provide copies of the FLM be informed of any advance by the Act to file the notice concerning relevant previous findings of adverse notification received by the permitting potential impacts on a Federal Class I impact on AQRV that have been made authority from a prospective applicant area. Section 165(d)(2)(C)(i) of the Act as part of other PSD permit reviews involving a source that would construct authorizes that the notice be filed by affecting the same Class I area. within 100 kilometers of a Federal Class any one of several officials, including The EPA is pursuing the development I area. As proposed, the affected FLM the Federal official charged with direct of a computerized compilation or must be notified within 30 days of the responsibility for management of any clearinghouse of available Class I area permitting authority’s receipt of any lands within the Class I area potentially information. The cooperation of the such advance notification of a PSD affected, the Federal Land Manager of FLM would be critical to the utility of permit application. See proposed such lands, the EPA Administrator, or this resource. Relevant information §§ 51.166(p)(3)(i) and 52.21 (p)(3)(i). the Governor of an adjacent State would be posted as it becomes available. The EPA recognizes that the type of containing such Class I lands. To the extent that the relevant early notification that a prospective Accordingly, the EPA is including in the information is posted in the applicant may provide to the permitting proposal that the FLM or other named clearinghouse, it would not be necessary authority will vary from one situation to officials may file a notice when it is to provide such information to an the next. Thus, the type of notification believed that a proposed source may applicant. If however, the FLM has new provided by the permitting authority to affect air quality in a Federal Class I information not yet available in the the FLM should be commensurate with area. See proposed §§ 51.166(p)(2)(i) clearinghouse, the FLM should directly the type of information which is and 52.21(p)(2)(i). In addition, the EPA provide such information to the received. For example, a brief letter or is proposing to define the term ‘‘Federal applicant when a request is made. This phone call from the permitting authority official,’’ which is used in the proposed to the FLM may be appropriate when regulatory provision as well as in the legislative history uses the term ‘‘supervisor of a the information about the potential class I area’’ in lieu of ‘‘Federal official.’’ See S. Rep. project is only very preliminary. Act, as the Federal official charged with No. 127, 95th Cong., 1st Sess. 35–37 (1977). Once direct responsibility for management of a notice is filed alleging possible adverse impacts, Generally, it should not be necessary to any lands within a Federal Class I the FLM—not any other Federal official, unless notify the FLM more than once area.58 See proposed §§ 51.166(b)(39) duly designated by the FLM—is authorized to concerning any early contacts by a demonstrate to the satisfaction of the permitting prospective applicant with the and 52.21(b)(40). authority that a proposed source will have an adverse impact on AQRV and that the permit permitting authority. An exception 58 The EPA is using the term ‘‘Federal official’’ to should be denied (as described elsewhere in this would be where, as described below, a reflect the terminology used in the Act. The preamble). See section 165(d)(2)(C)(ii) of the Act. pre-application meeting is arranged as a Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38287 result of subsequent communications regulatory revisions addressing advance to require notification of the affected between the applicant and the notification, including the appropriate FLM when a PSD permit application is permitting authority. type of notification, the mandatory received for a new or modified source Consistent with CAAAC notification within 100 kilometers of a proposing to locate within 100 recommendations, the EPA is also Federal Class I area, and the 30-day kilometers of a Federal Class I area. The proposing to require that the permitting timeframe for providing such proposed notification includes sending authority provide the FLM with notice notification to the FLM. The EPA is a copy of the permit application and any of, and reasonable opportunity to interested in the public’s views about other relevant information. See participate in, pre-application meetings the need for these changes in light of the proposed §§ 51.166(p)(4)(i) and scheduled with prospective PSD other regulatory revisions, described 52.21(p)(4)(i). applicants that would locate within 100 below, that the EPA is proposing to The proposed regulations do not kilometers of a Federal Class I area. See improve FLM coordination, including mandate that the permitting authority, proposed §§ 51.166(p)(3)(iii) and the proposed requirement that permit itself, must send each affected permit 52.21(p)(3)(ii). If given such an early applications for all PSD sources and application to the FLM. Instead, the opportunity, the FLM would be modifications proposing to locate State may elect to require the PSD expected, where possible, to inform the within 100 kilometers of a Federal Class applicant to directly transmit a copy of prospective applicant of concerns about I area must automatically be transmitted its application and other relevant Class I impacts, as well as any intention to the FLM. information to the FLM. In either case, to file a notice alleging potential Class b. Coordination of the Permit the EPA believes that the permitting I impacts. Application. Several of the CAAAC authority will want to ensure that the While this proposal for advance recommendations addressed improving FLM receives the application promptly notification applies specifically to coordination between the permitting so there will be few, if any, delays to the prospective sources and modifications authority and the FLM once a permit initial phase of the permit process. located 100 kilometers or closer to a application has been received. Similar With regard to the existing Federal Class I area, there should be no to the recommendations for pre- notification provision at § 51.166(p)(1), automatic presumption that sources application coordination addressed the EPA proposes to move this located farther than 100 kilometers will previously, such coordination was provision to a more appropriate not affect a Federal Class I area.59 There considered important in helping to location. This provision requires that will be instances where it would be avoid disputes and delays in carrying the permitting authority transmit to the prudent for the permitting authority to out the permit review process. Administrator a copy of each PSD notify the FLM of a prospective source The EPA is proposing to revise the permit application received and does that would locate more than 100 notification requirements that apply not address FLM notification. In its kilometers from a Federal Class I area. when the permitting authority receives present location in the regulations, the As further described below, the FLM a PSD permit application. The proposed existing EPA notification requirement will receive summary notification of notification requirements are to apply could be interpreted to apply only to such distant sources at the permit on the basis of the proximity of the proposed sources and modifications application notification stage and may proposed source or modification to a whose emissions affect a Federal Class be interested in learning about them as Federal Class I area. However, as I area. The Act provides that the EPA early as possible. However, the EPA has described previously, sources proposing notification requirement apply with declined to propose requirements for to locate near a Federal Class I area are respect to all PSD permit applications— mandatory pre-application notification not automatically assumed to have an not just those affecting Federal Class I adverse impact on that area. With the areas. See section 165(d)(1) of the Act. beyond the 100-kilometer distance. proposed revisions, the FLM is afforded In moving the existing provision to the Nevertheless, the EPA will consider a an opportunity to review the contents of new location in the part 51 regulations, more inclusive cutoff, e.g., 200 any PSD permit application to its intended coverage of all PSD permit kilometers, for mandatory pre- determine whether sufficient applications will be better understood. application notification, if for some information is available to assess the See proposed redesignated reason it is unable to implement the potential impacts on a Federal Class I § 51.166(q)(1). database that is intended to inform FLM area. As described earlier, in section (2) Notification to FLM for Sources about the more distant proposed new IV.C.1.c of this preamble, the EPA has Locating more than 100 Kilometers from major sources and major modifications. proposed to require that the FLM (or a Federal Class I Area. The EPA The EPA requests public comments other named officials) file a notice recognizes that the FLM will have an on all aspects of these proposed alleging potential Class I impacts in interest in reviewing the potential order to trigger specific Class I effects associated with emissions from 59 The 100-kilometer cutoff being used in this proposal for mandatory notification requirements informational needs in the permit certain sources proposing to locate more involving FLM’s is consistent with the current EPA application. The proposed 100 than 100 kilometers from a Federal policy concerning modeling of Class I impacts. In kilometer cutoff described below Class I area. It emphatically is not the an October 19, 1992 memorandum from John S. applies only to the automatic EPA’s intention to enable such sources Seitz, Director, Office of Air Quality Planning and Standards to EPA Regional Offices, the EPA notification (including forwarding of to be automatically exempted from clarified its guidance for modeling Class I area permit application) of the FLM that consideration as to their potential impacts under the PSD program. The policy such source has applied for a PSD impacts on Class I areas. However, a statement advised Regional Office personnel that it permit. general requirement to transmit copies was appropriate to routinely consider the ambient impacts resulting from PSD sources proposing to (1) Notification to FLM for Sources of all permit applications to the FLM locate within 100 kilometers of a Class I area. The Located Within 100 Kilometers of a would be quite burdensome and overly EPA further stated that such guidance was not to Federal Class I Area. Because sources inclusive. Accordingly, the EPA is be interpreted so as to preclude the consideration located within a 100-kilometer range of proposing a different approach for of potential impacts of emissions from large sources locating at distances greater than 100 kilometers if Federal Class I areas generally have the providing notification to the FLM for there is reason to believe that such sources could greatest potential for affecting the air applications proposing sources more adversely affect the air quality in the Class I area. quality in those areas, EPA is proposing than 100 kilometers from a Federal 38288 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Class I area. The EPA is developing a (starting from receipt of the application request for additional information has special electronic database and by the FLM) to review the application been satisfied by the applicant, and the proposing to require that a summary of prior to any completeness determination FLM has had an opportunity to file a each PSD permit application be entered issued by the permitting authority. The notice alleging potential Class I impacts, into this database.60 30-day review is required only when the if such notice has not already been filed. The proposed informational FLM is to receive the permit application In some cases, however, the permitting requirements include the name and type as provided under this proposal [See authority may question the request of source, the nature of the project, e.g., proposed § 51.166(p)(4)] where the made by the FLM or simply disagree source location and proximity to Class proposed source is located within 100 with it. When this occurs, the EPA is I areas (i.e., within 250 kilometers), the kilometers from a Federal Class I area or proposing that the permitting authority proposed emission rates (or emissions where it is located beyond 100 must consult with the FLM and try to increases) of air pollutants to be emitted kilometers but the FLM requests the resolve whatever problems may exist by the source, and key mailing entire application within 7 days from prior to issuing a completeness addresses. The FLM, as well as the the inclusion of summary information determination. See proposed general public, will have access to this in EPA’s electronic data base. See §§ 51.166(p)(5)(iv) and 52.21(p)(5)(iv). information. The administration of this proposed §§ 51.166(p)(5)(ii) and Nevertheless, while the permitting electronic database is addressed in more 52.21(p)(5)(ii).61 authority must give reasonable detail in section IV.C.6. of this During the proposed 30-day review consideration to the FLM’s concerns preamble, ‘‘Information Clearinghouse.’’ period, the FLM will have an under the proposed changes, the See proposed §§ 51.166(n)(4) and opportunity to determine whether there permitting authority is responsible for 52.21(n)(4). is reason to believe that the proposed making the ultimate decision regarding Once relevant information pertaining source may adversely affect a Federal the application’s completeness. The to a proposed major source or major Class I area and request additional proposed provisions allow the modification is registered in the EPA information, to be obtained from the permitting authority to issue its database, the FLM will be able to check applicant, in order for an adequate Class completeness determination any time the Bulletin Board, determine whether I impact analysis to be completed. The (either before or after the 30-day period such source represents a potential request for additional information by has ended) after any comments from the concern to air quality or air quality the FLM may be in the form of a notice FLM have been received and related values in the Class I area (based alleging that emissions from the consultation with the FLM has occurred on the summary information contained proposed source may cause or about any inconsistency between the therein), and request a copy of the entire contribute to a change in air quality in permitting authority’s views and the permit application. In order to ensure the affected Class I area and identifying FLM’s recommendations. that the FLM is given a reasonable the potential adverse impacts of such The CAAAC recommended that the opportunity to request a copy of any change on AQRV (see section IV.C.1.c. EPA consider establishing a formal specific application (for sources that of this preamble). If such notice is given, dispute resolution process as a part of would locate beyond the 100-kilometer the permit applicant would be required the completeness review. The EPA has range), the EPA is proposing that the to perform the Class I impact analysis, declined to propose any specific FLM will be afforded at least 7 days discussed previously, to satisfy its requirements focusing on the resolution from the date of registration of obligation for a complete application. of potential problems between the information on the electronic database The EPA’s proposed regulations would permitting authority and the FLM. to review such information and request also require permitting authorities to Instead, the EPA’s proposal the entire permit application. See consider, in making a completeness contemplates that the permitting proposed §§ 51.166(p)(4)(ii) and determination, any comments provided authority and the FLM retain discretion 52.21(p)(4)(ii). by the FLM concerning the to determine the nature of consultation The EPA requests public comments completeness of the application within that is appropriate. The EPA believes on its proposed requirements to the 30-day review period. See proposed that most permitting authorities and improve the notification procedures §§ 51.166(p)(5)(iii) and 52.21(p)(5)(iii). permit applicants recognize the merits which inform the FLM about incoming The EPA generally anticipates that the of early consultation with the FLM and permit applications. In particular, the permitting authority will respond that all affected parties will work in a EPA requests public comments affirmatively to the FLM’s request for cooperative manner. d. Coordination of the Preliminary addressing the proposed requirement to additional information and will notify Determination. The Act provides that, if transmit a permit application to the the applicant that the application is incomplete and require such additional the proposed source or modification FLM when the proposed source is will not cause or contribute to a within 100 kilometers of a Federal Class information from the applicant. The permitting authority generally should violation of an increment in a Federal I area. Class I area, the FLM has the burden of c. Coordination of the Completeness not announce that an application is deemed complete until the FLM’s demonstrating to the satisfaction of the Determination. The EPA is also permitting authority that the source will proposing to revise both sets of PSD 61 For proposed sources more than 100 have an adverse impact on AQRV. If so regulations by adding a requirement that demonstrated, the Act mandates that the the FLM be given at least 30 days kilometers from a Federal Class I area, the permitting authority may proceed to issue its permit shall not be issued. Conversely, completeness determination any time after the 7- if a proposed source or modification 60 Under the part 51 PSD regulations, the day period for FLM review if the FLM does not proposed requirement does not specify whether the request a copy of the permit application. However, causes or contributes to an increment applicant or the permitting authority must enter the the FLM is not precluded from requesting violation in a Federal Class I area, the data summary. The EPA believes that it is additional information at any time after the formal permit may be issued if the owner or appropriate in this situation to allow permitting 7-day review period. But, such later requests will operator demonstrates to the satisfaction authorities to exercise their discretion in not trigger the 30-day FLM review period prior to determining what specific procedures they will the permitting authority’s completeness of the FLM that the proposed source adopt and implement to ensure that the required determination proposed elsewhere in this notice will have no adverse impact on AQRV data is entered into the EPA electronic database. [See, e.g., proposed section 51.166(p)(5)(i)]. and the FLM so certifies. See section Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38289

165(d)(2)(C)(ii) and (iii) of the Act. In in a Federal Class I area, but is generally completing the demonstration of an either situation, the FLM has an given an abbreviated time to complete adverse impact on AQRV. The EPA will affirmative responsibility to protect the this critical task. consider a different time period if it can AQRV associated with the affected In contrast, the part 51 PSD be shown that such different period Federal Class I area. See section regulations [See existing paragraph would allow a more appropriate amount 165(d)(2)(B) of the Act. (p)(3)] require that the State provide a of time for the FLM to complete any The EPA is proposing several mechanism whereby the FLM may necessary analyses without unduly revisions to the existing PSD regulations present a demonstration of an adverse delaying the permit process. concerning the permitting authority’s impact on AQRV to the permitting In addition, the EPA requests preliminary determination to issue or authority after the preliminary comments on its own role. Section not issue the PSD permit where a determination has been made. This 165(d)(2)(B) of the Act provides that the proposed source will not cause or existing requirement does not FLM and the Federal official charged contribute to a violation of a Class I contemplate that the FLM’s with direct responsibility for land increment and the FLM has submitted a demonstration would be best addressed management have an ‘‘affirmative demonstration that a proposed source as part of the preliminary determination responsibility’’ to ‘‘consider, in will have an adverse impact on AQRV. and then made available for public consultation with the Administrator, Specifically, these changes relate to (1) notice and comment. whether a proposed major emitting clarifications to existing regulations The EPA believes that it is important facility will have an adverse impact.’’ addressing the scope of the FLM’s to the permitting process that the FLM’s The EPA is not proposing a specific demonstration of an adverse impact on demonstration be submitted before a role, beyond the significant AQRV, (2) timing for submittal of the preliminary determination is made and programmatic changes related to Class I FLM’s demonstration to the permitting that sufficient time be allowed to area protection proposed today, authority for consideration prior to complete the demonstration. Thirty concerning how it should consult with issuing or denying a PSD permit, and (3) days is generally not a sufficient amount the FLM. The EPA requests comments criteria which the permitting authority of time for the FLM to complete a on this issue. must consider in deciding to nonconcur demonstration of an adverse impact on (3) Rejection of the FLM’s with the FLM’s demonstration. AQRV. Instead, the EPA proposes that Demonstration of an Adverse Impact on (1) Scope of the FLM’s Demonstration the FLM be allowed at least 60 days to AQRV. The Act and EPA’s PSD of an Adverse Impact on AQRV. The make the required demonstration. regulations provide that where the existing part 52 PSD regulations are Moreover, the proposed regulations permitting authority determines that a inadequate because they only require provide that the 60-day period occur proposed source’s emissions will not the Administrator to consider the FLM’s prior to a preliminary determination so cause or contribute to a violation of a demonstration of the visibility impacts that any demonstration submitted by the Class I increment, the FLM must of a proposed source, and therefore do FLM may be adequately considered by demonstrate ‘‘to the satisfaction of the not contemplate consideration of other the permitting authority and addressed permitting authority’’ that the proposed AQRV. See existing § 52.21(p)(3). When as part of the preliminary source will have an adverse impact on the part 52 PSD regulations were determination. See proposed AQRV. The permitting authority is thus originally promulgated, visibility was §§ 51.166(p)(6)(i) and 52.21(p)(6)(i). given the authority to accept or reject the only specified AQRV; however, the The EPA also believes that a 60-day the FLM’s demonstration. The FLM have identified a variety of AQRV period (beginning on the date that the permitting authority’s concurrence with and, as discussed previously, the EPA is permitting authority formally issues its such demonstration means that the proposing a more general definition of determination that the application is permitting authority must propose to AQRV similar to the definition that the complete), taken together with the deny the PSD permit. See existing FLM have historically been using. See, improvements addressed above to §§ 51.166(p)(3) and 52.21(p)(4). [See e.g., proposed § 51.166(b)(40). Thus, the facilitate earlier FLM and permitting also proposed §§ 51.166(p)(6)(ii) and EPA is proposing to delete the existing authority coordination, provides the 52.21(p)(6)(ii).] If the permitting provision in § 52.21, and, under the FLM with a more reasonable period of authority determines that the FLM has proposed revisions described time. During this period, the FLM may not demonstrated to its satisfaction that immediately below, provide for need to conduct a variety of technical a proposed source’s emissions will have consideration of the FLM’s analyses or perhaps request (via the an adverse impact on AQRV, the demonstration of an adverse impact on permitting authority) that the applicant permitting authority may reject the AQRV. provide additional analyses to provide FLM’s demonstration so long as it has (2) Timing for Submittal of the FLM’s sufficient basis for the demonstration to a rational basis for doing so.62 Demonstration of an Adverse Impact on be developed. This will, of course, Recent permit controversies have AQRV. Under the existing part 52 PSD depend on the amount of information underscored the need for national regulations, the FLM is given only 30 already contained in the application as guidance addressing the permitting days from receipt of a notice (that a PSD a result of prior coordination about the authority’s role in evaluating the FLM’s application has been submitted) from potential impacts on AQRV in the demonstration of an adverse impact on the Administrator to provide the Federal Class I area. For example, if the AQRV and the rationale for any decision required demonstration of an adverse FLM has issued notice pursuant to to disagree with the FLM’s findings. For impact on AQRV for the Administrator’s proposed §§ 51.166(p)(2)(i) or example, in a PSD permit appeal consideration prior to the 52.21(p)(2)(i), alleging that the proposed proceeding, the EPA’s Environmental Administrator’s issuance of a source may impact a Federal Class I Appeals Board held that the permitting preliminary permit determination. This area, then the FLM may rely on the authority erred in summarily rejecting time constraint places the FLM in a ensuing impact analysis performed by the demonstrations of the FLM for the dilemma. The FLM is expected to the applicant as at least a significant provide a well-documented, reasoned starting point for the FLM’s evaluation. 62 See 50 FR 28544, 28549 (July 12, 1985); see demonstration of an adverse impact on The EPA invites public comments on also Old Dominion Electric Cooperative, PSD AQRV that a proposed source will have the adequacy of a 60-day period for Appeal No. 91–39 at 8 and n. 9 (Jan. 29, 1992). 38290 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Shenandoah National Park and James including a brief summary of the Class 3. Mitigating an Adverse Impact on River Face Wilderness that the proposed I area impact issues in the public notice AQRV facility would have an adverse impact announcing the preliminary permit a. Background. In general, a PSD on AQRV in those Federal Class I determination, and explaining in permit shall not be issued when the 63 areas. writing, in the public record, its specific emissions from a proposed facility In an effort to provide clearer reasons for rejecting the FLM’s would have an adverse impact on AQRV guidance and promote more reasoned demonstration of adverse impact. See in a Federal Class I area. See section decision-making, the EPA is proposing proposed §§ 51.166(p)(6)(iii), 165(d)(2)(C) of the Act. This specific to require that certain considerations 51.166(q)(4)(ii) and (iii), and prohibition on permit issuance applies must be addressed and made public 52.21(p)(6)(iii). The EPA believes that when the FLM of a Class I area concerning a permitting authority’s the requirement to indicate in the public demonstrates to the satisfaction of the rejection of the FLM’s demonstration of notice that the FLM’s demonstration has permitting authority that emissions from an adverse impact on AQRV. In doing been rejected will give the public a proposed source will have an adverse so, the EPA has tried to balance the sufficient notice and opportunity to impact on AQRV, notwithstanding that statutory provisions concerning the access the permitting authority’s reasons the proposed source does not cause or affirmative responsibility given to the for not being satisfied with the FLM’s contribute to a violation of a Class I FLM to protect AQRV and the demonstration. Such access will aid the increment. See section 165(d)(2)(C)(ii) of stipulation that the permitting authority public’s ability to comment the Act. There have been several must be satisfied with the FLM’s meaningfully at any public hearing that instances over the past few years where, demonstration of adverse impact on may be requested. As proposed, the in such circumstances, the FLM has AQRV in any particular situation. permitting authority’s written submitted a demonstration of an adverse The FLM are entrusted with explanation must address, at a impact on AQRV in a Class I area. In administering the statutes governing the minimum, the following factors: some cases, the FLM’s concerns have management and preservation of i. Scientific/Technical Basis. The been addressed through successful Federal Class I areas, and are expressly permitting authority must consider all negotiations between the FLM and the entrusted by the Act with an affirmative relevant data and analyses submitted by permit applicant, where the source responsibility to protect AQRV. The the FLM and offer a reasoned obtained either emissions reductions FLM have expert knowledge about the explanation for its disagreement with (offsets) from an existing source, or unique values associated with Federal such data and the resulting analyses. adopted more stringent control lands, and administer ongoing See proposed §§ 51.166(p)(6)(iii)(A) and measures, or did some combination of monitoring and research programs to 52.21(p)(6)(iii)(A). both.64 In other instances, similar help evaluate the effects that air demonstrations of an adverse impact on pollution has on such values. ii. Description of the AQRV and Adverse Impact. The permitting AQRV have been the subject of Accordingly, the EPA believes it is contentious administrative litigation.65 appropriate for the permitting authority authority must address the FLM’s findings describing the adverse impact b. General Policy for Mitigating Class to recognize the FLM’s broad expertise I Area Impacts. The CAAAC in the identification and evaluation of being demonstrated for each affected AQRV, by explaining any conclusions it recommended requiring offsets for any adverse effects on AQRV. proposed source that would have an Notwithstanding this expertise, the reaches, about whether the projected impacts of the source’s emissions will adverse impact on AQRV. Specifically, permitting authority may call upon the CAAAC recommended that where experts of its own choosing to evaluate have an adverse impact on the AQRV, that are inconsistent with the the emission offset ratio was less than the findings in the FLM’s 1:1, a net air quality benefit analysis demonstration. conclusions reached in the demonstration submitted by the FLM. should be made to support the specific Where the permitting authority is not offset ratio proposed. The CAAAC satisfied with the FLM’s demonstration See proposed §§ 51.166(p)(6)(iii)(B) and 52.21(p)(6)(iii)(B). recommended that, where the emission of adverse impact on AQRV, the EPA is offset ratio is greater than 1:1, a proposing (1) a general consultation iii. Mitigative Measures. The standardized emission/distance provision necessitating some form of permitting authority must describe any adjustment factor for offsets could be communication and discussion between efforts that have been undertaken to used instead of demonstrating that a net the permitting authority and the FLM; mitigate the potential impacts of a air quality benefit results from the and (2) a provision requiring the proposed source on the Federal Class I offsets. permitting authority to highlight the area of concern, including any estimated While the EPA agrees with the issues raised by the FLM and explain its emissions reductions, and the effect of CAAAC’s overarching concern that the reasons for disagreement in the public such reductions. See proposed EPA provide guidance on the record. The permitting authority would §§ 51.166(p)(6)(iii)(C) and satisfy this latter requirement by 52.21(p)(6)(iii)(C). 64 See, e.g., Multitrade Limited Partnership, PSD Finally, the EPA is proposing to Appeal Nos. 91–2 et alia (January 21, 1992). In 63 Hadson Power 14—Buena Vista, PSD Appeal Multitrade the proposed source agreed to mitigate Nos. 92–3, 92–4 & 92–5 (Oct. 5, 1992). The EPA require that, for any permit ultimately its impact through a combination of reduced Environmental Appeals Board reasoned that, issued to a source determined by the emissions from the new source as originally ‘‘States do not have unfettered discretion to reject FLM to have an adverse impact on proposed and emission offsets from a nearby an FLM’s adverse impact determination. If a State AQRV, the permitting authority must existing source, resulting in an offset ratio determines that an FLM has not satisfactorily substantially greater than one-to-one. Based on demonstrated an adverse impact on AQRV from the address any additional comments or these changes, the FLM concluded that the proposed facility, the State must provide a ‘rational input from the FLM (intended to emissions from the proposed source, if modified, basis’ for such a conclusion, ‘given the FLM’s substantiate or augment its initial would not have an adverse impact on the affirmative responsibility and expertise regarding demonstration) that may be submitted Shenandoah National Park. Id. at 5. the Class I areas within their jurisdiction.’ 50 FR 65 See Old Dominion Electric Cooperative, PSD 28549 (July 12, 1985). Arbitrary and capricious during the public comment period. See Appeal No. 91–39 (January 29, 1992); Hadson rejections of adverse impact demonstrations are not proposed §§ 51.166(p)(6)(iv) and Power 14—Buena Vista, PSD Appeal Nos. 92–3, 92– sustainable.’’ [Hadson at p. 21. (citations omitted)] 52.21(p)(6)(iv). 4 & 92–5 (October 5, 1992). Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38291 implementation of mitigating offsets, the credited as offsets for new source review such monitoring may provide critical EPA declines to recommend rigid tests purposes.67 information about a source’s impact on for assessing the adequacy of offsets. Unlike the nonattainment NSR a Class I area. Rather, the EPA proposes that general program, offsets under the PSD program The EPA is proposing to amend its principles already established under the are not expressly addressed by the Act. PSD regulations to clarify that post- PSD program guide the implementation The EPA is interested in the public’s construction ambient monitoring may of offsets. In addition, the EPA is views about the crediting of those be required for the purpose of proposing to add a provision to the PSD emission reductions already required for determining the effect emissions from a regulations that explicitly provides what other purposes as offsets for mitigating facility may have, or are having, on EPA has previously acknowledged—that a proposed source’s adverse impact on AQRV in a Federal Class I area. The an AQRV. sources may mitigate an adverse impact existing PSD regulations at As an alternative to emissions offsets, on AQRV in order to obtain a PSD §§ 51.166(m)(2) and 52.21(m)(2) a more stringent emission limitation currently require the owner or operator permit.66 See proposed §§ 51.166(p)(7) than the limitation that would otherwise of a new major source or major and 52.21(p)(7). be required by BACT may be established modification to conduct such post- The proposed provision specifies that to mitigate an adverse impact on an construction ambient monitoring, as the PSD programs shall allow for mitigation AQRV in a Federal Class I area. permitting authority determines to be by a proposed source and specifically Depending upon the remaining necessary, to determine the effect provides that the permitting authority emissions released and the sensitivity of emissions may have, or are having, on may issue a permit for a proposed major the AQRV of a Class I area, an emissions air quality in any area. However, the source or major modification that would limitation that would otherwise be current EPA regulations do not specify otherwise be denied a permit because of required by BACT, if an adverse impact that such ambient monitoring may an adverse impact on AQRV, if the on an AQRV was not considered, may include the monitoring of air quality- permitting authority determines, in be inadequate to entirely mitigate the related impacts in Federal Class I areas. consultation with the FLM, that the adverse impact. Thus, emission offsets, The EPA is, therefore, proposing to source has mitigated the adverse impact a stricter emission limitation, or some amend the PSD regulations to on AQRV. The EPA believes that sound combination of both, may be specifically state that post-construction appropriate to mitigate an adverse technical evidence should support a ambient monitoring may be required in impact on an AQRV. Class I areas. See proposed amendatory demonstration of mitigation. The The EPA believes that measures such demonstration should show that there language for §§ 51.166(m)(2) and as emission offsets from existing sources 52.21(m)(2). The EPA requests will be no net adverse impact as a result represent a reasonable approach which of the proposed source’s emissions. The comments on this proposed regulatory enables the mitigation of an adverse change. proposed provision specifically impact on an AQRV. The EPA’s acknowledges offsets as a mitigation mitigation policy provides needed 4. Class I Significant Impact Levels option where the owner or operator of flexibility to the PSD permitting process Some members of the NSR Reform a proposed source obtains enforceable by allowing a new major source or major Subcommittee recommended that the and permanent emissions reductions of modification that mitigates an adverse EPA provide criteria indicating the sufficient amount and in such location impact on AQRV to receive a circumstances in which a proposed that the reductions will offset the construction permit, even though its source’s projected contribution to change in air quality in the Federal proposed emissions increase is ambient concentrations in a Class I area Class I area that would have resulted otherwise demonstrated by the FLM, may be considered de minimis for from the proposed source. See proposed and concurred with by the permitting certain planning requirements. These §§ 51.166(p)(7) and 52.21(p)(7). The authority, to have an adverse impact on members recommended that the EPA quantitative amount of the offsetting AQRV. The adoption of this policy is identify a level of contribution (ambient emissions should, therefore, be shown also intended to promote dispatch in the concentration) that is de minimis, or to be sufficient to in fact mitigate the PSD permit process by providing a insignificant, so that a proposed source adverse impact on AQRV that would clearly available elective recourse having a contribution less than that otherwise be caused by the proposed enabling applicants to avoid potentially concentration will know with certainty emissions increase. This will involve contentious and protracted permitting that it will not be subject to the full consideration of the location of the disputes where the FLM demonstrates requirements for an increment analysis offsetting source relative to the Class I an adverse impact on AQRV and the in Class I areas. The EPA believes that area, as well as the meteorological and applicant wishes to mitigate its it is reasonable to extend the use of topographical conditions which affect demonstrated impacts prior to a formal significant impact levels to the Class I dispersion of the offsetting emissions. concurrence with the demonstration by increments. Levels of significant impact the permitting authority. are currently used as a matter of policy Another possible consideration in c. Post-construction Monitoring. The in the PSD program for determining evaluating whether any potential CAAAC recommendations addressing emission reductions identified at mitigation of an adverse impact on whether a proposed source may be existing sources can be used to mitigate AQRV included consideration of post- excluded from certain requirements the adverse impact on any AQRV is (e.g., significant emissions rates, and construction monitoring for Class I 68 whether the reductions are already areas. Post-construction monitoring significant monitoring concentrations). required by some other Act-mandated alone would not directly mitigate an 68 For example, under the PSD regulations, a program. In nonattainment areas, adverse impact on AQRV. However, comprehensive preconstruction review must be section 173(c)(2) of the Act plainly conducted for each regulated pollutant that a prohibits emission reductions otherwise 67 Incidental emission reductions not otherwise proposed major source or major modification will required under the Act from being required by the Act are to be creditable under have the PTE in ‘‘significant’’ amounts, as defined section 173(c)(2) of the Act. See also 57 FR 13553 in existing section 51.166(b)(23)(i) and (April 16, 1992) (guidance on creditable reductions 52.21(b)(23)(i). Under existing section 51.166(i)(8) 66 See Multitrade at p. 7–8, n.5. under the nonattainment NSR program). Continued 38292 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

See, also, discussion in section IV.C.5.a. A de minimis impact resulting from the percent of the 24-hour standards for of this preamble, addressing the emissions from a proposed source particulate matter and SO2 were proposed codification of significant would serve as the basis for a sufficiently small so as to be considered impact levels for NAAQS and Class II determination that such emissions will de minimis.70 and III increments. not contribute to a violation of the It should be noted that, while the Administrative agencies may exempt applicable Class I increments. FLM representing the National Park ‘‘truly de minimis’’ situations from a The proposed significant impact Service and the U.S. Fish and Wildlife statutory command ‘‘when the burdens levels for Class I increments were Service agree that the general use of of regulation yield a gain of trivial or no derived by taking four percent of the significant impact levels for Class I value.’’ 69 Accordingly, the EPA is concentration defined for the existing increments may be appropriate, they proposing to add significant impact Class I increment for each applicable have indicated that such levels should levels for Class I increments to both sets pollutant and averaging period. The be adequately conservative. These FLM of PSD regulations. See proposed EPA believes that where a proposed have, in fact, recommended significant §§ 51.166(b)(23)(v) and 52.21(b)(23)(v). source contributes less than four percent impact levels that are more restrictive The proposed significant impact levels to the Class I increment, concentrations than those being proposed today by would apply to the existing Class I are sufficiently low so as not to warrant EPA. Their recommended levels were increments for PM–10, SO2, and NO2 in a costly and detailed analysis of the developed using the ratios derived from the PSD regulations. The significant combined effects of the proposed source a comparison of existing significant impact levels would be used to and all other increment-consuming impact levels—used by EPA for NAAQS determine whether a new major source emissions. The EPA previously used a and Class II increment analyses—and or major modification, due to the similar rationale to establish the the respective NAAQS. For comparative predicted ambient concentration from significant emissions rates for PSD purposes the significant impact levels its own emissions, would be required to applicability purposes, concluding in being proposed today by EPA and the conduct a comprehensive Class I part that emissions rates which resulted levels recommended by the FLM are increment analysis for a given pollutant. in ambient impacts less than four shown below.

Levels Rec- Pollutant Averaging time Levels proposed ommended by by EPA (ug/m3) FLM (ug/m3)

Sulfur Dioxide ...... Annual ...... 0.1 0.03 24-hour ...... 0.2 0.07 3-hour ...... 1.0 0.48 Particulate Matter ...... Annual ...... 0.2 0.08 24-hour ...... 0.3 0.27 Nitrogen Dioxide ...... Annual ...... 0.1 0.03

The EPA wishes to emphasize that the impact is less than the applicable Accordingly, emissions increases not specific significant impact levels that it significant impact level for Class I resulting in ambient concentrations or is proposing today for the Class I increments would neither relieve the deposition rates exceeding the increments are not intended to serve as applicant from having to complete an prescribed significance levels would thresholds for determining the need for analysis of impacts on AQRV nor therefore be excluded from a review of an AQRV analysis or whether an automatically allow the permitting AQRV impacts. adverse impact on AQRV will occur. An authority to reject the FLM’s The EPA generally recognizes the adverse impact on AQRV in a Class I demonstration of adverse impact on administrative benefits of categorically area depends upon the sensitivity of the AQRV. The EPA requests comments on eliminating certain pollutant-emitting particular AQRV and involves an its proposal to establish significant activities from regulatory review and assessment of potential harm. An impact levels for Class I increments in has employed significance levels in ambient pollutant concentration that is general, and the proposed levels in other contexts in the NSR program, deemed to be of relatively insignificant particular. including the significance levels consequence for purposes of increment The EPA is declining to propose proposed above for Class I increments. consumption should not automatically specific significance levels for However, there are many obstacles to be considered inconsequential relative determining whether the emissions from formulating reasonable significance to the inherently fact-specific a proposed source may have an adverse levels in the AQRV context. For demonstration upon which an adverse impact on AQRV. The FLM is example, there are numerous AQRV and impact on AQRV is to be based. Thus, specifically entrusted by the Act with there is a wide variance in sensitivity to a notice may be filed (as described in protecting AQRV and the decision to emissions increases for particular section IV.C.1.c. of this preamble) establish any appropriate significance AQRV. alleging that a proposed source’s levels for AQRV should be made The FLM have been working with emissions may cause or contribute to a primarily by the FLM. Conceptually, other air pollution effects scientists to change in the air quality in a Federal such significance levels would represent develop lists of sensitive resources (e.g., Class I area and identifying the potential ambient air pollutant concentrations or species of plants and invertebrates, and adverse impact of such change. The fact deposition rates below which only de particular streams and lakes) and that such source’s predicted ambient minimis effects on AQRV will occur. sensitivity thresholds that could help and section 52.21(i)(8), the permitting authority applicant’s air quality impact for such pollutant is 70 See 45 FR 52676, 52707–52708 (August 7, may exempt a proposed source from having to less than the ‘‘significant’’ concentration prescribed 1980). include ambient monitoring data in its permit in the regulations. application for a particular pollutant if the 69 Alabama Power Co. v. Costle, 636 F.2d 323, 360–61 (D.C. Cir. 1979). Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38293 establish significant impact levels for EPA is proposing to incorporate into the beyond the area normally considered to individual AQRV in the future. PSD regulations the significant impact be within the proposed source’s impact However, many studies conducted to levels currently set forth at area. See proposed date have not yielded the information § 51.165(b)(2)—which are being used to §§ 51.166(p)(2)(i)(A)(2) and needed to establish a critical threshold determine whether major new source or 52.21(p)(2)(i)(A)(2), and related level from which a significance level major modification contributes to a discussion in section IV.C.1.c. of this could be derived. The EPA encourages violation of a NAAQS—so that they may preamble. the FLM to continue pursuing research be directly applied to the ‘‘significant The FLM have expressed concern that on AQRV effects, and anticipates an contribution’’ test in the PSD the existing provisions, see, e.g., evolving process by which research and regulations. See proposed existing § 51.166(o)(1), which enable the information may eventually support the §§ 51.166(b)(23)(iv) and 52.21(b)(23)(iv). applicant to exclude from analysis any establishment of site specific The EPA has long interpreted the impact on vegetation ‘‘having no significance levels for individual AQRV. ‘‘significant contribution’’ test set forth significant commercial or recreational Any significant impact levels for AQRV in existing § 51.165(b)(2) to apply to value,’’ could exclude the analysis of may necessarily be site specific since PSD sources, as well, since the certain vegetation with ecological each AQRV and its associated critical provision applies to major new sources significance in the lands under their pollutant loadings may be different from and major modifications located in jurisdiction, i.e., Federal Class I and II one area to another and even within attainment and unclassifiable areas. areas. The EPA is proposing a change in individual Federal Class I areas. In any Finally, the EPA is proposing to add the existing provisions so that event, EPA encourages the significant impact levels for the Class II applicants may not presume that soils establishment of an electronic database and Class III increments. See proposed and vegetation in Federal Class I and II about Class I area resources, described §§ 51.166(b)(23)(v) and 52.21(b)(23)(v). areas are of no significant commercial or elsewhere in this preamble, that will The proposed levels are the same as recreational value, except where the make information about available those levels at existing § 51.165(b)(2), FLM indicates that such analysis is not research on AQRV effects more which define a significant contribution needed. See proposed amendatory accessible. to a violation of the NAAQS, and simply language for §§ 51.166(o)(1) and The EPA requests public comment on codify current EPA policy which allows 52.21(o)(1). the issue of significance levels for the significant impact levels from c. Clarification of PSD Requirements AQRV. In particular, EPA is interested § 51.165(b)(2) to be directly applied to Applicable to Non-Federal Lands in suggestions regarding alternative the PSD program to determine a Redesignated as Class I Areas. approaches that promote regulatory significant contribution to either the Individual CAAAC members and Tribal certainty by excluding from NAAQS or PSD increments. The EPA representatives have asked the EPA to consideration proposed sources that requests comment on the need to provide guidance on the PSD provisions have truly de minimis impacts on Class include these significant impact levels that apply to ‘‘non-Federal’’ reservation I resources while still ensuring that in the PSD regulations and the need for lands that are redesignated as Class I AQRV are adequately protected in the significant impact levels for Class II and areas.71 In particular, guidance has been PSD permitting process. Commenters Class III increments. Furthermore, the requested concerning whether AQRV should fully consider the legal EPA requests comment on the proposed may be established for such lands and standards that govern the establishment significant impact levels for the Class II how these values are to be protected of de minimis regulatory exemptions. and Class III increments, specifically under the PSD program. The discussion See e.g., Alabama Power Co. v. Costle, whether they should be lower than the below is intended to clarify the EPA’s 636 F. 2d 323, 360–61 (D.C. Cir. 1979). levels used for NAAQS compliance. views on these issues and to describe b. Analysis of Impacts on Federal 5. Clarification of Miscellaneous Issues the accompanying, largely technical, Class II Areas. This proposal also regulatory revisions that the EPA is The discussion which follows clarifies the requirement for the today proposing. The policies described addresses several relatively discrete ‘‘additional impact analysis’’ under in the following discussion would also issues. The EPA is clarifying current § 51.166 and 52.21. In addition to the apply to non-Federal State lands policy in areas where there is potential central requirements that each PSD redesignated as Class I areas. for significant confusion or uncertainty source must demonstrate that its (1) Redesignation of Class I Areas. and, in some instances, is proposing allowable emissions will not cause or Section 164(c) of the Act gives federally- conforming changes to the contribute to a violation of any NAAQS recognized Indian Tribes72 broad implementing regulations. The EPA is or PSD increment, each such source is authority to request redesignation of also proposing changes that largely generally required to prepare further lands within the exterior boundaries of codify existing policy. analyses for the pollutants that it will a. Significant Impact Levels for emit. Such ‘‘additional impact analysis’’ 71 Lands within reservation boundaries may be NAAQS and Class II and III Increments. is consistent with the statutory Federal lands under Federal Indian law and may or The EPA is proposing several changes to provisions under section 165(e)(3)(B) of may not be ‘‘Federal lands’’ within the specific the PSD regulations at both §§ 51.166 the Act, and includes an assessment of meaning of the PSD program. ‘‘Federal lands’’ under the PSD program include: national and 52.21 to make the rules consistent the impairment of visibility, soils, and wilderness areas, national memorial parks, national with current practice. First, the EPA is vegetation within the proposed source’s parks, national monuments, national reserves, proposing to revise the provisions of impact area, including Federal Class I national seashores and other similar national public existing §§ 51.166(k) and 52.21(k) to and II areas. See proposed amendatory land areas. See, e.g., sections 160(2), 162(a) and 164(d) of the Act. The term ‘‘non-Federal’’ is used clarify that a source’s own emissions language for §§ 51.166(o)(1) and here to refer to State lands or lands within the must make a ‘‘significant contribution’’ 52.21(o)(1). In addition, the EPA is boundaries of an Indian reservation that are not to a violation of any NAAQS or PSD proposing more specific provisions for Federal lands within the meaning of the Act’s PSD Class II or III increment before that Federal Class I areas that require similar program. 72 See section 302(r) of the Act. The Department source would be denied a PSD permit. analysis where a FLM alleges that an of the Interior periodically publishes a list of Tribes See proposed amendatory language for adverse impact on AQRV may occur in officially recognized by the Federal government. §§ 51.166(k) and 52.21(k). Second, the Federal Class I area lands located See 58 FR 54364 (Oct. 21, 1993). 38294 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules their reservations as Class I areas. the Administrator shall make a determination should be made part of Several Indian Tribes have already had recommendation to resolve the dispute the applicable State implementation lands within reservation boundaries and protect the AQRV of the lands plan or Federal implementation plan, redesignated as Class I areas. The EPA involved.’’ See section 164(e) of the whichever is appropriate for the affected has approved redesignation of the Act.74 Accordingly, AQRV may be State, or the applicable Tribal Northern Cheyenne Indian Reservation, identified by States and Tribes for implementation plan or Federal the Flathead Indian Reservation, the redesignated non-Federal Class I areas implementation plan, whichever is Fort Peck Indian Reservation and the and these areas may be protected by a appropriate for the affected Indian Spokane Indian Reservation on the basis State’s or Tribe’s request for the EPA to Tribe. Therefore, the EPA is proposing of tribal requests. See 40 CFR 52.1382(c) resolve an intergovernmental dispute to amend the existing regulatory and 52.2497. States also have broad over a proposed PSD facility pursuant to provision by changing the words ‘‘State authority under section 164(a) to request section 164(e). The EPA requests implementation plan’’ to read redesignation of lands as Class I areas. comments on its proposed ‘‘applicable plan’’ consistent with the To date, the EPA has not received such interpretation of the circumstances that language in the Act. See proposed a State PSD redesignation request. authorize a State or Tribe to involve the amendatory language for § 52.21(t). (2) Status of AQRV Protection for EPA in resolving interjurisdictional The same wording problem is found Non-Federal Lands Redesignated as permitting disputes pursuant to section in existing §§ 51.166(g) and 52.21(g), Class I Areas. Any State or federally- 164(e). concerning area redesignation proposed recognized Tribe may establish AQRV The EPA, in the preceding discussion, by States or Indian Tribes. In that for non-Federal lands within its is drawing a key distinction between the particular case, the regulatory jurisdiction which have been authority bestowed solely on FLM provisions provide that the redesignated as Class I areas. The under section 165(d) of the Act to redesignation is subject to approval as a mechanism identified in the Act, by protect the AQRV of Federal Class I revision to the ‘‘applicable State which a State or Tribe may seek areas and the authority States and implementation plan.’’ Accordingly, for protection of such AQRV when a Tribes have under section 164(e) to the same reasons, the EPA is proposing proposed or modified major source in protect the AQRV of non-Federal lands clarifying revisions to §§ 51.166(g) and another jurisdiction will affect any through the dispute resolution 52.21(g) by changing ‘‘applicable State AQRV which have been established, is mechanism. The EPA intends to clearly implementation plan’’ to read contained in section 164(e) of the Act. distinguish between provisions that ‘‘applicable plan.’’ See proposed See also § 52.21(t). Section 164(e) of the apply to the protection of AQRV of non- amendatory language for §§ 51.166(g)(1) Act is a special dispute resolution Federal class I areas and the provisions and 52.21(g)(1). The proposed addition provision involving intervention by the that apply to FLM under paragraph (p) of the dispute resolution provision in EPA Administrator. If the governing of the existing and proposed PSD the part 51 PSD regulations will body of an affected Indian Tribe or regulations in parts 51 and 52 by similarly use the statutory language, the Governor of an affected State determines proposing a definition for ‘‘Federal ‘‘applicable plan.’’ See proposed that a proposed PSD source ‘‘will cause Class I areas.’’ The EPA proposes to § 51.166(t). or contribute to a cumulative change in define ‘‘Federal Class I areas’’ as those The EPA is also proposing to revise air quality in excess of that allowed in areas owned by the United States and superseded definitions of ‘‘Indian this part [i.e., part C, title I of the Act, either (1) designated by Congress as Reservation’’ in existing §§ 51.166(b)(27) mandatory Class I areas, unable to be containing the PSD program]’’ the Tribe and 52.21(b)(27). The 1990 redesignated, pursuant to section 162(a) or State may request that the Amendments to the Act added several of the Act, or (2) redesignated as Class Administrator enter into negotiations provisions relating to the authority of I pursuant to paragraph (g) of the with the parties involved to resolve the Indian Tribes to administer Act existing PSD regulations. See proposed dispute.73 If requested by the Tribe or programs in the same manner as States. §§ 51.166(b)(38) and 52.21(b)(39). State, the Administrator must make a See sections 301(d) and 110(o) of the The existing part 52 PSD regulations recommendation ‘‘to resolve the dispute Act. Section 110(o) provides that already contain a dispute resolution and protect the air quality related values implementation plans for Tribes are to provision based on section 164(e) of the of the lands involved.’’ See section be effective ‘‘within the exterior Act. However, the existing provision at 164(e) of the Act. boundaries of the reservation, § 52.21(t) of the PSD regulations The EPA proposes to interpret these notwithstanding the issuance of any requires that, when the parties involved provisions to direct EPA intervention, at patent and including rights-of-way in a dispute do not reach agreement, the the request of a State or Tribe, when a running through the reservation.’’ On Administrator’s determination (or the State or Tribe determines that a August 25, 1994, the EPA published results of agreements reached through proposed source will cause or proposed rules implementing the some other means) is to become part of contribute to a violation of a NAAQS or general Act Tribal authority added in the applicable ‘‘State implementation PSD increment or will harm AQRV the 1990 amendments and proposed to plan.’’ To avoid confusion, the EPA is established by a State or Tribe. In define reservation under those rules as proposing to revise the language to accordance with section 164(e), the PSD ‘‘all land within the limits of any Indian conform with the statutory language, provisions prohibit ‘‘changes in air reservation under the jurisdiction of the which refers instead to the ‘‘applicable quality’’ that exceed these requirements. United States Government, plan.’’ The EPA believes that the more See proposed § 51.166(t) and existing notwithstanding the issuance of any general reference to the ‘‘applicable § 52.21(t). Further, as to AQRV, their patent, and including rights-of-way plan’’ used in the statutory language protection is a stated purpose of the running through the reservation.’’ See will avoid potential confusion because, EPA’s involvement in the dispute—’’ 59 FR 43956 at 43980 (proposed 40 CFR in disputes involving a State and an 49.2). In the accompanying preamble, Indian Tribe, the Administrator’s 73 Section 164(e) also provides that a State or the EPA explained: Tribe may request EPA to enter into negotiations to resolve interjurisdictional disputes about PSD air 74 Note also that the dispute resolution Based on recent Supreme Court case law, quality redesignation. provisions are not limited to class I areas. EPA has construed the term ‘reservation’ to Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38295 incorporate trust land that has been validly Second, EPA will pursue the requirements that apply in areas set apart for use by a Tribe, even though that development of a FLM Clearinghouse in designated attainment and land has not been formally designated as a which the FLM and the EPA will post unclassifiable (PSD areas) and in areas ‘reservation.’ See 56 FR at 64,881 (Dec. 12, the following information as it becomes designated nonattainment. For 1991); see also Oklahoma Tax Commission v. Citizen Band Potawatomi Indian Tribe of available: efficiency, these requirements generally Oklahoma, 111 S.Ct. 905, 910 (1991). The —Boundaries and size of existing are implemented in conjunction with EPA will be guided by relevant case law in Federal Class I areas PSD and nonattainment NSR permitting. interpreting the scope of ‘reservation’ under —Area-specific AQRV information, The current visibility NSR rules contain the Act. including sensitive receptors, critical FLM coordination procedures. In some See 59 FR at 43,960. Accordingly, the loadings, current source inventory, instances, the visibility NSR rules also EPA adopts this interpretation of current loadings from sources in the adopt, by cross reference, some of the reservation for the PSD program and source inventory, and existing adverse provisions of the PSD rules EPA is proposes to make conforming changes to conditions; proposing to revise today. the definition of ‘‘Indian Reservation.’’ —Source-specific information on The EPA may therefore need to revise See proposed §§ 51.166(b)(27) and increment consumption and impacts its current visibility NSR rules, 52.21(b)(27). on AQRV in specific Federal Class I depending upon the outcome of the areas; rules proposed today. The EPA would 6. Information Clearinghouse (Federal —Reports of research and investigations want to ensure that the different sets of Class I areas) about the impacts of air pollution on rules are appropriately harmonized in The CAAAC recommended that the natural resources in Federal Class I light of the permit streamlining goals EPA establish a clearinghouse of areas, and contact persons for further embodied in this proposal and the information about Federal Class I areas. information; potential for overall improvement in The EPA has been working on a —Comment letters and any findings of FLM, State and permit applicant clearinghouse project that was originally an adverse impact on AQRV issued coordination reflected in the rules planned to be incorporated into the relative to specific draft PSD permits; proposed today. —Adjudicative appeals and EPA’s public NSR BB which is hosted V. Prevention of Significant by the OAQPS TTN.75 The advent of the corresponding orders from the EPA  Environmental Appeals Board and Deterioration Preconstruction ‘‘Internet ’’ system and new budgetary Monitoring constraints are causing EPA to consider court decisions relative to issues new strategies for transferring involving Federal Class I areas. Applicants for PSD permits often information. Nevertheless, the EPA All users of the NSR BB will be able must provide continuous air quality plans to address the CAAAC’s to download all the documents posted monitoring data as part of the air quality recommendations in two respects. in this clearinghouse. As suggested analysis requirements set forth in First, consistent with the proposed earlier, the host mechanism, the §§ 51.166(m) and 52.21(m) of the PSD requirement to improve permitting schedule for completion and the degree regulations. In both sets of regulations authority and FLM coordination, of sophistication of this clearinghouse the air quality data provision generally described in section IV.C.2., above, the will depend greatly on available requires that an applicant for a new EPA is planning to create a publicly resources, the dynamics of the major source or major modification accessible, electronic bulletin board for electronic communications industry, submit with the permit application posting notice of major NSR permit and the cooperation of the FLM continuous air quality monitoring data applications by permitting authorities Agencies. representing the 12-month period preceding application submittal.76 and/or permit applicants. On this 7. Visibility New Source Review bulletin board will be logged very basic Historically, this data requirement has source information, such as the name If adopted, these proposed revisions been satisfied largely through the use of and type of source, a brief description to the PSD rules related to the monitoring data collected from existing of its location in terms of the State and protection of air quality related values State or local agency air quality county in which it will construct and (including visibility) in Federal Class I monitoring networks. However, in the operate (including UTM coordinates), areas may necessitate revisions to EPA’s absence of existing data, it is the the distance between the proposed existing visibility new source review applicant’s responsibility to establish, source and all Federal Class I areas rules (the ‘‘visibility NSR’’ rules), which operate and maintain sufficient air within 250 kilometers, and the proposed are codified separately from the PSD monitoring stations to collect the emission rate or net emissions increase rules. See, e.g., existing 40 CFR 51.307, necessary ambient data to satisfy the of each air pollutant associated with the 52.27 and 52.28. Section 169A(a)(1) of data requirement. project. It also will allow permit the Act established as a national goal The prospect of having to operate applicants and permitting authorities to the prevention of any future, and the their own monitoring networks and present questions to the FLM regarding remedying of any existing, manmade air quality issues relative to any Federal impairment of visibility in mandatory 76 The PSD regulations currently provide that the Federal Class I areas. Section 169A also permitting authority has discretion to exempt an lands potentially affected by the applicant from the requirement to collect proposed new or increased emissions, called for EPA to promulgate regulations continuous air quality monitoring data if (1) the and, conversely, provide a contact to to assure reasonable progress toward predicted ambient impact caused by the proposed whom the FLM may direct inquiries and meeting the national goal. See section source, or (2) the ambient pollutant concentrations information. See proposed 169A(a)(4) of the Act. Accordingly, EPA that the proposed source would affect, are less than prescribed significant monitoring concentrations for §§ 51.166(n)(4) and 52.21(n)(4). has promulgated visibility regulations to the pollutants listed in the PSD regulations (or if the address prospective visibility pollutant emitted from the proposed source is not 75 Historically, users of the NSR BB have been impairment in mandatory Federal Class among those listed). If, however, both the predicted able to retrieve, then read and/or download full text I areas from certain new or modified impacts and the existing ambient concentrations of recent policy and guidance material. The users exceed the significant monitoring concentrations, may also solicit from or provide to other parties in major stationary sources. then the applicant must provide the required the NSR permitting community, information The visibility NSR rules establish monitoring data. See existing sections 51.166(i)(8) pertaining to areas of interest within NSR. independent visibility protection and 52.21(i)(8). 38296 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules collect ambient data for 1 year prior to The EPA had argued in the Alabama compliance with NAAQS and PSD the submittal of a complete PSD Power case that monitoring air quality increments. Yet some sources still are application has long been a concern of concentrations was technologically confronted with the requirement to industry, particularly in cases where infeasible for all but a small number of provide air quality monitoring data as there is no practical need for the data in pollutants and that the available part of a complete application. the air quality analysis. This monitoring monitoring techniques were at best of Further, the use of air quality data has responsibility obligates a considerable questionable accuracy even for the been used only to a limited extent in the amount of an applicant’s resources and relatively straightforward measurement past to calibrate models for specific SIP- often interposes significant time prior to of whether an applicable NAAQS has related applications; however, such permit application submittal. Permitting been exceeded. The Court rejected the authorities frequently have agreed that EPA’s arguments, reasoning that the calibration of air quality models has not the monitoring requirement imposes an statute clearly required monitoring for been a common practice. Moreover, the unnecessary burden on industry where determining whether PSD increments EPA’s Guideline on Air Quality Models the data is not needed for the air quality would be exceeded. The Court describes the uncertainty associated analysis but is required by regulation discerned from the Act that Congress with comparing short-term model nevertheless. had a technology forcing intent in estimates with ambient measurements The air quality data requirement requiring such monitoring. The Court and concludes that ‘‘short term model originates in the Act at section 165(e) (1) indicated that Congress intended that calibration is unacceptable.’’ See 58 FR and (2). Section 165(e)(1) requires, for the development of monitoring 38816 at 38835, July 20, 1993. In each PSD source, a preconstruction techniques and the resulting data addition, ambient monitoring analysis ‘‘of the ambient air quality at impose discipline on the use of techniques that could be used to the proposed site and in areas which modeling. The Court explained that measure increment consumption are may be affected by emissions from such Congress intended ‘‘that the still not available because of the facility for each pollutant subject to employment of modeling techniques inability of ambient monitors to separate regulation under [the Act] which will be [the principal device relied on for the pollutant concentrations attributable emitted from such facility.’’ predicting source impacts] be held to to increment-consuming and non- Section 165(e)(2) of the Act requires earth by a continual process of increment consuming source emissions. that the air quality analysis ‘‘shall confirmation and reassessment, a Available ambient monitoring methods include continuous air quality process that enhances confidence in cannot make such distinctions. monitoring data gathered for purposes modeling, as a means for realistic The EPA believes that it is of determining whether emissions from projection of air quality.’’ See Alabama appropriate to reassess the regulatory such facility will exceed the maximum Power, 636 F.2d at 372. However, the requirement for preconstruction allowable increases or maximum Court added, ‘‘[o]f course even a monitoring data for proposed PSD allowable concentrations permitted congressional mandate, such as a under [the PSD provisions].’’ Further, technology-forcing requirement based construction to address situations where section 165(e)(2) provides that data for on a congressional projection of the collection of such air quality data the analysis shall be gathered over a emergence of technology for the future, serves no practical purpose in the period of 1 calendar year preceding the is subject to a justified excuse from required air quality analysis. A more permit application or for a shorter compliance where good-faith effort to reasonable approach is to give the period if a State determines that a comply has not been fruitful of results.’’ permitting authority discretion not to complete and adequate analysis may be Id. The Court found that such a require the submittal of air quality accomplished, according to the EPA legitimate ‘‘excuse’’ had not been monitoring data—including the regulations.77 presented in the case, in which the EPA installation and operation of monitoring On June 19, 1978, the EPA exempted sources from preconstruction stations by the applicant—where the promulgated regulations which required monitoring for PSD increments based permitting authority determines such a source to submit an air quality upon current technological infeasibility. data to be unnecessary to assess the air analysis that included continuous air The Court’s opinion thus quality in the area affected by the quality monitoring data only for those contemplates that the EPA, after an proposed source. pollutants, emitted by the source, which additional 15 years of experience under However, before the EPA decides would impact an existing NAAQS. See the PSD program since Alabama Power, whether to propose specific changes to 43 FR 26380. Monitoring data was not may excuse strict compliance with the the existing requirements, it is seeking required to determine whether the requirements of section 165(e)(2) where public input concerning the benefits source would cause or contribute to a a good-faith effort in preconstruction and disadvantages of the current air violation of a PSD increment. In monitoring has failed in producing quality monitoring requirements. The Alabama Power Co. v. Costle, 636 F.2d fruitful results. Elsewhere in the 323, 371–372 (D.C. Cir. 1979), the Alabama Power decision the court also EPA is also seeking information reviewing court found the June 19, 1978 indicated that there is a basis for a concerning those specific situations regulation to be deficient in that it did statutory exemption ‘‘when the burdens where air quality monitoring data was not provide for continuous of regulation yield a gain of trivial or no required as part of a complete preconstruction monitoring for purpose value.’’ Id. at 360–61. application, and whether the data was of determining impacts on both NAAQS In the years since the court’s decision, considered to serve a necessary or and increments. On August 7, 1980, the questions have continued concerning useful purpose in the required air EPA corrected the deficiency by the provisions requiring the submittal of quality analysis. Based on the resulting promulgating the current PSD air quality monitoring data in cases comments and information, the EPA regulations covering preconstruction where such data is not deemed will determine whether it is appropriate monitoring requirements. See 45 FR necessary or useful as part of the air to subsequently propose changes to the 52676. quality analysis. Modeled estimates of current air quality monitoring air quality are often sufficient to make requirements at §§ 51.166(m)(1) and 77 See, e.g., existing section 51.166(m)(1)(iv). the required demonstrations of source 52.21(m)(1). Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38297

VI. Changes Resulting From the 1990 section 184(b)(2). New section 182 (1) The Current Regulations. The Clean Air Act (1990) Amendments establishes new major source thresholds EPA’s current regulations for of 50 tpy, 25 tpy, and 10 tpy for sources determining a major modification are set A. NSR Provisions for Nonattainment of VOC in areas classified as serious, out at 40 CFR 51.165. These regulations Area Permitting severe, and extreme, respectively. define a ‘‘major modification’’ as: 1. Provisions for Ozone Nonattainment Section 182(f) sets forth the ** *any physical change in or change in Areas presumption that NOX is an ozone the method of operation of a major stationary New sections 182 through 185 (part D, precursor unless the Administrator source that would result in a significant net title I) of the Act contain new NSR makes a finding of nonapplicability or emissions increase of any pollutant subject to requirements specifically for ozone grants a waiver pursuant to criteria regulation under the Act* * * nonattainment areas that supplement contained in that subsection.79 See existing § 51.165(a)(1)(v)(A). the basic requirements in section 173 of Specifically, section 182(f) provides that Under these regulations, the ‘‘net the Act. In general, Congress intended requirements applicable for major emissions increase’’ is calculated taking that these new requirements vary in stationary sources of VOC shall apply to into account all contemporaneous, stringency according to the severity of major stationary sources of NOX, unless creditable, actual emissions increases the ozone nonattainment problem. The otherwise determined by the and decreases on a plant-wide basis. See severity of the ozone nonattainment Administrator. Pursuant to section existing § 51.165(a)(1)(vi). Emissions problem is as expressed through a series 182(f), EPA is proposing that in cases increases and decreases are of area classifications. where NOX is considered an ozone ‘‘contemporaneous’’ with the increase a. Area Classifications. Section 181(a) precursor, major stationary sources of from the proposed project only if they defines five area classifications for NOX are also subject to the part D NSR occur before the date that the increase ozone based on ambient ozone requirements applicable for VOC in from the proposed project occurs, and concentrations (ozone design values).78 ozone nonattainment areas and OTR’s. no earlier than the reasonable These five classifications (in ascending See proposed § 51.165(a)(12). The major contemporaneous time period specified order of severity) are marginal, stationary source thresholds for NOX by the reviewing authority. Id. moderate, serious, severe, and extreme. and VOC are the same except in the ‘‘Significant’’ is defined for ozone to Some ozone nonattainment areas do OTR for marginal, moderate, or mean, in reference to a ‘‘net emissions not fit under the section 181 unclassified ozone nonattainment areas increase,’’ a rate of emissions equal to or classifications. Therefore, the EPA has and attainment (or nonclassifiable) exceeding 40 tpy of VOC. See existing classified these ‘‘nonclassifiable’’ ozone areas. For these latter areas, the § 51.165(a)(1)(x). Thus, a net emissions nonattainment areas into three major stationary source threshold for increase of VOC that is less than 40 tpy additional groupings referred to as VOC is 50 tpy while the major source is considered de minimis. transitional, submarginal, and threshold for NOX is 100 tpy. In serious, The EPA’s policy under its existing incomplete/no data areas. The severe, and extreme ozone NSR regulations has been that a nonclassifiable ozone nonattainment nonattainment areas, the applicable proposed modification resulting in a de areas should all be considered of equal major stationary source threshold for minimis increase (standing alone classification for purposes of NOX is 50 tpy, 25 tpy, and 10 tpy, without considering any decreases implementing the applicable NSR respectively. Note that NOX is not associated with the proposed requirements, and are subject to the considered an ozone precursor in modification), is not major, regardless of NSR requirements under section 173 nonclassifiable ozone nonattainment previous contemporaneous emissions (the basic requirements). However, areas unless the area is in the OTR. increases and decreases. This policy when such area is located within an In this proposal, the EPA is changing was discussed in detail in an EPA OTR, the area will be treated as a the existing definition of ‘‘major memorandum dated June 3, 1983 moderate area for NSR purposes. stationary source’’ to add the new entitled ‘‘Net Emission Increase Under b. Major Stationary Sources. Congress statutory major source thresholds for PSD’’ from Sheldon Myers, Director, retained the 100 tpy major source both VOC and NOX emissions, as OAQPS. This has been called a ‘‘non- threshold for stationary sources of VOC applicable. See proposed aggregation policy’’ because netting in the less severely polluted ozone §§ 51.165(a)(1)(iv)(A) (1) and (2). contemporaneous increases and nonattainment areas. For those more c. Major Modifications. The 1990 decreases would not be necessary unless severely polluted areas, including ozone Amendments change the requirements the proposed modification standing transport areas, Congress specified applicable to modifications of stationary alone would result in a significant progressively lower thresholds. The sources in serious, severe, and extreme emissions increase. existing threshold of 100 tpy continues ozone nonattainment areas to determine (2) Modifications in Marginal, to apply generally to sources of VOC in whether such a modification is a major Moderate, and Nonclassifiable Ozone areas classified as marginal, moderate, modification subject to nonattainment Nonattainment Areas. As noted above, or any category of nonclassifiable ozone NSR. The 1990 Amendments do not the 1990 Amendments do not mandate nonattainment areas. However, when mandate a change in approach for a change in the current regulatory any of the above areas is in an ozone marginal, moderate, and nonclassifiable approach for major stationary sources of transport area, the major source ozone nonattainment areas. VOC emissions in marginal, moderate, threshold is 50 tpy of VOC pursuant to and nonclassifiable ozone 79 80 The EPA policy on the applicability of NOX nonattainment areas, or major 78 A detailed description of the individual area requirements under section 182(f) of the Act is in stationary sources in the ozone classifications for ozone nonattainment areas is the document ‘‘Guideline for Determining the attainment areas in the OTR under contained in the EPA’s General Preamble for the Applicability of Nitrogen Oxides Requirements Implementation of Title I of the 1990 Amendments, Under Section 182(f)’’, December 1993, U.S. EPA, section 184(b)(2). Therefore the 57 FR 13498 (April 16, 1992). The reader who is OAQPS, and two memoranda, dated May 27, 1994 not already familiar with these classifications, as and February 8, 1995, both entitled, ‘‘Section 182(f) 80 Nonclassifiable nonattainment areas include well as the general new SIP requirements for ozone, Nitrogen Oxides (NOX) Exemptions—Revised transitional, submarginal, and incomplete or ‘‘no should refer to the General Preamble for Process and Criteria,’’ from John Seitz, Director of data’’ areas, as defined in the General Preamble, 57 background information. the OAQPS, to EPA’s Regional Air Directors. FR 13524 (April 16, 1992). 38298 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules approach for determining whether provisions to help States change their i. The De Minimis Rule. The new modifications at major stationary NSR rules to implement these new section 182(c)(6) of the Act specifies a sources of VOC emissions are major provisions of the Act. In addition, new approach for determining whether (hence subject to nonattainment NSR) in sources are awaiting EPA’s proposed proposed modifications are subject to these areas will default to that which interpretation so that sources may use nonattainment NSR. It states that emerges from the proposed NSR reforms internal offsets to minimize the NSR increased emissions of VOC resulting described in section II of this preamble. requirements as allowed under the Act. from any modification of a major Because Congress did not specify a In response to these requests EPA is stationary source: different significance level for these proposing to amend the nonattainment ** * shall not be considered de minimis areas, the EPA is not proposing to NSR regulations to include the new for purposes of determining the applicability change the current significance special provisions for modifications in of the permit requirements established by threshold level for VOC emissions of 40 serious and severe ozone nonattainment this chapter unless the increase in net tpy for modifications at major VOC areas as discussed below. See proposed emissions of such air pollutant from such sources in these areas. § 51.165(a)(1)(v)(D). source does not exceed 25 tons when For the entire OTR, section 184(b)(2) In sum, for serious and severe ozone aggregated with all other net increases in nonattainment areas the EPA is emissions from the source over any period of requires that at a minimum the 5 consecutive calendar years which includes nonattainment NSR provisions proposing the following changes to the the calendar year in which such increase applicable to moderate ozone current method for determining whether occurred * * * nonattainment areas also apply to major proposed modifications emitting VOC at major stationary sources of VOC are In short, this provision changes the stationary sources of VOC. Again, current significance level for VOC section 182(f) makes requirements for subject to nonattainment NSR: • emissions (in serious and severe ozone proposed modification applicable to The new significance level for modifications would change from 40 tpy nonatttainment areas) from 40 tpy to major stationary sources of NOX in an or more to greater than 25 tpy; ‘‘greater than 25 tpy,’’ i.e., 25 tpy or less OTR, as well. This means that, within • is de minimis. See proposed an OTR, the NO requirements of The provisions for determining the X net emissions increase (netting) during § 51.165(a)(1)(x)(B). As explained below, section 182(f) apply to classified and the EPA does not believe that this nonclassifiable ozone nonattainment the 5-year contemporaneous period would apply to emissions increases provision necessarily changes the areas and to ozone attainment (or approach to ‘‘netting’’ increases and unclassifiable) areas. from the proposed modifications, including such increases that are less decreases. It does, however, specify a The EPA is also proposing that the ‘‘contemporaneous’’ period slightly approach retained for determining than ‘‘significant’’ standing alone; • The contemporaneous time period different than that currently used, and whether a modification at an existing for netting would be the 5-year period departs from the ‘‘nonaggregation’’ stationary source of VOC emissions is that includes the calendar year in which policy to require netting over the major will also apply to modifications at the proposed modification will begin contemporaneous period in all instances major source of NO in these areas. See X emitting and the 4 previous calendar where there is an increase in net proposed § 51.165(a)(12). In addition, in years; and emissions from the proposed areas where the VOC significance • As a source option, creditable modification standing alone. threshold for modifications is 40 tpy, internal offsets at a ratio of at least 1.3:1 The EPA is proposing that the first the EPA is also proposing that the could be used for the proposed step in applying section 182(c)(6) is to significance threshold level for NOX modification (or for any discrete unit, determine the ‘‘increase in net emissions for modifications at major operation, or pollution-emitting activity emissions’’ from the proposed NOX sources be 40 tpy. See proposed that is part of the proposed modification for which NSR § 51.165(a)(1)(x)(C). Since Congress modification) to either: (a) avoid applicability is in question.82 The net generally intended to treat major NOX nonattainment NSR at existing major emissions from the proposed sources in a manner similar to major sources that emit, or have the potential modification (referred to here as the VOC sources and did not specify a NOX to emit, less than 100 tpy of VOC; or (b) ‘‘project net’’) is the sum of all proposed significance threshold different from the avoid LAER at existing major sources creditable emissions increases and current VOC level, the EPA believes it that emit, or have the PTE, 100 tpy or decreases proposed at the source is appropriate to propose a NOX more of VOC. between the date of application for the significance level for modifications that Section 182(f) of the Act generally modification and the date the parallels the 40 tpy VOC significance requires new or modified sources of modification begins emitting.83 See level. NOX located in ozone nonattainment proposed § 51.165(a)(1)(v)(D)(1). If the (3) Special Modification Provisions in areas classified as serious or severe to project net is an emissions increase, Serious and Severe Areas. Sections meet permit requirements consistent then the next step is to aggregate the 182(c)(6), (7), and (8) of the Act change with those applicable to major sources project net emissions increase with all the procedures for determining the of VOC. Accordingly, the EPA is applicability of the nonattainment NSR proposing to require, in addition to the 82 Note that it is only the project net emissions increase from the proposed modification that could requirements to a major stationary proposed special provisions described source of ozone [and in some areas NO potentially trigger the netting under section X below, that such provisions also apply 182(c)(6). Therefore, it is only the proposed under section 182(f) of the Act] which to NOX emissions at modifications of modification that may possibly have to meet the undergoes a modification in a serious or new source requirements, not all of the previous major sources of NOX. See proposed 81 projects that are aggregated in the determination of severe ozone nonattainment area. The § 51.165(a)(11). The proposed regulatory States have requested EPA’s contemporaneous ‘‘net emissions increase’’ under language also provides that such section 182(c)(6). There is no requirement, for interpretation of the new special requirements shall not apply to sources example, to retroactively apply LAER to prior changes within the 5 year contemporaneous period. of NOX in areas where the 81 The 1990 Amendments do not mandate a 83 States have the flexibility to be more stringent change in approach for modifications in marginal, Administrator has determined that the than the EPA in their rules. For example, States moderate, and nonclassifiable ozone nonattainment provisions of section 182(f) do not may opt to not allow emissions decreases when areas. apply. determining the project net. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38299 other ‘‘net increases in emissions from subsections 182(c) (7) and (8). Another this discussion. Nor do other places in the source’’ over the 5-year alternative might be to calculate a ‘‘net the legislative history clearly specify contemporaneous period. This increase’’ for changes that are made at such a change. See id. at 241–42; Cong. aggregation is referred to as the the same time, as part of a single project Rec. at H12870 (Oct. 26, 1990) contemporaneous net. Note that this is in a single application. But there does (statement of Rep. Oxley). The EPA a change from the current regulatory not seem to be a significant reason requests comment on this interpretation. approach, in which proposed de Congress would have wanted to provide The EPA specifically requests comments minimis modifications are not subject to an incentive for sources to plan on whether emissions reductions should nonattainment NSR and there is no decreases at the particular time be credited when determining the aggregation over a contemporaneous increases would occur within the 5-year ‘‘project net’’ and the period for them. period. Thus, the EPA believes that ‘‘contemporaneous net.’’ Two associated issues must be Congress did not intend to exclude For these special modification addressed in interpreting the new permanent, quantifiable, enforceable, provisions, the quantity of emissions provisions of section 182(c)(6) of the and otherwise creditable decreases from that must be offset to meet the Act: the first, is to what extent the netting calculation. The Agency nonattainment NSR general offset creditable decreases in emissions may believes that Congress emphasized provisions is the project net emissions be aggregated together with creditable increases simply because it is those that increase for proposed major increases in emissions; the second, is are necessary to exceed the 25-ton modifications. This means that the the precise 5-year period over which the threshold, and, by this action, Congress project net emissions increase from the emissions are to be aggregated. In did not thereby intend to exclude proposed modification, and not the implementing these special otherwise creditable decreases from the contemporaneous net emissions modification provisions, note that netting calculations. increase calculation over the increases and decreases are creditable The Agency believes the legislative contemporaneous period, determines for netting only to the extent the history supports the above conclusion. the quantity of emissions from the creditability criteria under existing The House Report summarized the proposed modification that must be § 51.165(a)(1)(vi) are met. This netting treatment of ‘‘netting’’ in H.R. 3030 offset. While only the project net criterion requires that the emissions (containing the same language as the emissions increase need be offset, States reductions are consistent with the area’s statute as enacted) as follows: are required to reconcile their emissions attainment demonstration and plan for In addition, the graduated control inventory by accounting for all increases reasonable further progress (RFP). requirements include continued use of in emissions in order to demonstrate (a) Netting Increases and Decreases. ‘‘netting’’ in other than extreme areas subject RFP and attainment. For cases where The EPA believes that this new to increasingly stringent limitations for discrete emissions limits are offset provision is most reasonably understood higher classifications. The netting process internally at a 1.3:1 offset ratio under to change the significance threshold allows sources making modifications that section 182(c) (7) or (8) of the Act, the emissions level for serious and severe would otherwise be subject to the new source amount to be offset is the emissions ozone nonattainment areas, and to review requirements of the Act to escape increase from the units within the such requirements upon a showing that the continue to allow both creditable emissions increase associated with the proposed project. However, if such units increases and creditable decreases modification is ‘‘netted out’’ to a de minimis replace existing units, the emissions occurring during the contemporaneous overall level by emission decreases from reduction from the replaced units may period to be ‘‘netted’’ together. The elsewhere within the source. The netting be credited towards reducing the language of section 182(c)(6) is concept has in many cases allowed sources quantity of emissions that must be ambiguous. It refers to aggregating ‘‘net to modernize and expand without internally offset. increases in emissions from the source.’’ application of new source review provisions (b) The 5-Year Contemporaneous While the language omits any reference intended to assure that modernization and Period. A remaining issue is the time expansions bring about continued air quality to ‘‘decreases,’’ the word ‘‘net’’ indicates improvement. It is the Committee’s view that period over which other net increases that decreases may be deducted from new source review should reconcile from the source are to be aggregated. the increases. The EPA believes that economic growth with clean air. It is an Section 182(c)(6) of the Act specifies Congress intended for the EPA and the important concept for modifications that ‘‘any period of 5 calendar years which States to use the current netting criteria affect ongoing operations of existing facilities includes the calendar year in which to determine what emission reductions and related existing jobs. Limitations on such increase occurred.’’ From this are creditable. The rationale for this netting in serious and severe areas include a plain language, the period must include position is outlined below. lowered de minimis level from today’s level the full calendar year in which the The statutory provision does not of 40 tons per transaction, to a 5-year total of no more than 25 tons. increase occurred, including the rest of address how increases and decreases are the calendar year beyond the actual time to be ‘‘netted’’ to calculate the ‘‘net See H. Rep. No. 490, part 1, 101st Cong., of the increase. This differs from the increases’’ that are to be aggregated. The 2d Sess., at 234–35 1990. This EPA’s current regulations that allow the use of the plural ‘‘net increases’’ discussion highlights the important reviewing authority to specify a longer arguably contradicts a single netting netting changes involving the threshold period extending before construction of calculation of increases and decreases level mandatory aggregation,84 but the particular change and through the over the 5-year period. Under this view, omits any discussion of a change in date that the increase from the increases and decreases over the 5 years eligibility of decreases in the netting particular change occurs. See existing would have to be grouped to result in calculation. Had Congress intended § 51.165(a)(1)(vi)(B). a series of ‘‘net increases.’’ The such an important change, it would be An ambiguity arises from the reference to increases in emissions surprising that it is not mentioned in provision’s reference to ‘‘any’’ 5-year ‘‘from the source,’’ does not seem to period. The EPA’s current regulations limit netting of increases and decreases 84 Section 182(c)(6) of the Act also changes the specify a single period. Id. The reference bounds of the contemporaneous period from the that occur from changes at a ‘‘discrete pre-existing regulations. But this is not a major to ‘‘any’’ in section 182(c)(6) raises an operation, unit, or other pollutant change, and it is not surprising that it is not raised issue whether the contemporaneous emitting activity.’’ Compare with in the legislative history discussions. period may include other combinations 38300 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules of 5 consecutive years including the period is as stringent as the EPA’s. To difficult for all but the smallest year of the particular increase. Other the extent increases may be netted with increases and decreases. combinations would, of course, include decreases over the contemporaneous Second, under Alabama Power future years beyond the year of the period, the EPA is concerned there may categorical exemptions may also be particular increase. The EPA does not be no way to tell in a particular case permissible as an exercise of an believe Congress intended that the whether a longer or different Agency’s powers to recognize contemporaneous period include such contemporaneous period is more inconsequential situations. Id. at 360. In future years. This is because the NSR stringent than the EPA’s proposed general, an Agency can create this program has always been limited to approach. exemption where the application of a addressing the emissions impact of new (c) Trivial Increases. Some States have regulation across all classes will ‘‘yield growth when it occurs, including both inquired whether every single increase a gain of trivial or no value.’’ Id. The ‘‘offset’’ and LAER technology that is a modification must be tracked exemption is not available where the requirements. If NSR applicability is under the new de minimis rule or regulatory scheme ‘‘does provide based on future actions, the need for whether States may adopt sub-de benefits, in the sense of furthering the offsets and LAER could not be finally minimis levels and exclude increases regulatory objectives, but the Agency determined at the time a particular (and, presumably, decreases) below concludes that the acknowledged modification is made. Instead, the EPA these levels. The EPA is not now benefits are exceeded by the costs.’’ Id. believes that the reference to ‘‘any’’ was proposing a particular level of sub-de A determination of when a matter can included simply in recognition of the minimis increases and decreases, but be classified as de minimis turns ‘‘on fact that the particular span of calendar the EPA may consider whether such the assessment of particular years will change over time. In short, levels are acceptable in States’ NSR SIP circumstances’’ of the individual case. Congress simply recognized that the submissions. The EPA requests Id. The EPA believes that a State’s period of 5 calendar years, from, for comment on the following discussion of demonstration that a particular increase example, 1992 to 1996 is different than this issue, and on what type of sub-de is trivial and of no consequence in the period from 1993 to 1997. minimis level, if any, might be furthering the statutory purpose must Therefore, for these special acceptable. take account of the size of the applicable modification provisions the EPA is threshold and major source thresholds This issue turns on the EPA’s legal proposing that the 5-year applicable in the various areas. For authority to exclude emissions increases contemporaneous period is the period of example, a 5-ton increase is 20 percent (and decreases) from a rule that, on its 5 consecutive calendar years ending of the de minimis threshold for serious face, seemingly applies to every with the full calendar year when the and severe areas and half the major emission increase—no matter how small increase in emissions from the proposed source threshold in extreme areas. It is the increase may be. In Alabama Power modification is to occur. See proposed not at all clear that an increase of that Co. v. Costle, 636 F.2d 323, 357 (D.C. § 51.165(a)(1)(vi)(C)(1). In any case, the size could be characterized as trivial. On Cir. 1979), the court discussed two bases EPA believes consideration of future the other hand, a level of less than one years in the de minimis calculation for categorical regulatory exemptions ton might conceivably be more beyond the calendar year when the that could apply here. Where these reasonable. Any such showing by a increase occurs would raise serious grounds exist, the availability of a State would surely have to be supported implementation problems, because categorical regulatory exemption may be by solid scientific evidence and increases in future years must be presumed ‘‘save in the face of the most analysis. projected and may not be certain. The unambiguous demonstration of In any case, the EPA emphasizes that permitting authority might impose congressional intent to foreclose them.’’ States must track and quantify all permit conditions to ensure that a 636 F.2d at 357. However, the EPA lacks emissions increases to the extent source limits increases in future years the power to revise legislative directives necessary to ensure progress toward consistent with a projection on which a in a manner ‘‘inconsistent with the clear attainment. Small measurable increases current de minimis calculation is intent of the relevant statute.’’ Id. at 358 from any stationary source should be based.85 The EPA solicits comments on [quoting NRDC v. Costle, 568 F.2d 1369, addressed in States’ stationary source whether the 5-year period may extend 1377 (D.C. Cir. 1977)]. permitting programs consistent with beyond the calendar year when the First, the Agency may create a section 110(a)(2)(C) of the Act to assure increase in emissions from the proposed categorical regulatory exemption out of that NAAQS are achieved. In addition, modification is to occur. administrative necessity, where small measurable increases should be The EPA also requests comment on compliance with the explicit counted as minor source growth under whether a State may propose a different instructions of a statute may be section 173(a)(1)(A) of the Act. These contemporaneous period, so long as the infeasible, impractical, or impossible. provisions suggest a very high hurdle to State can demonstrate that any such See Alabama Power, 636 F.2d at 358– show that tracking such small increases 59. However, there is a ‘‘heavy’’ burden is either trifling or will administratively 85 Congressman Waxman, in a law review article, where, as here, the Agency seeks to frustrate the NSR program. suggests that section 182(c)(6) requires that the sum create a ‘‘prospective exemption of ii. Special Modification Rules. If a of net emissions increases be below the de minimis certain categories from a statutory particular physical or operational level over all 5-year periods, including the year of the particular increase. Under this approach, no command based upon the Agency’s change at a major stationary source in a emissions increase could be determined to be de prediction of the difficulties of serious or severe ozone nonattainment minimis ‘‘until 5 years after it has occurred.’’ See undertaking regulation.’’ Id. at 359. The area is not considered de minimis under Waxman, Wetstone, and Barnett, ‘‘Roadmap to Title I of the Clean Air Act Amendments of 1990,’’ 21 EPA believes that, since very small section 182(c)(6), then the provisions of Northwest Univ. Envir. L. Rev. 1843, 1874 (1991). increases resulting from modifications sections 182(c) (7) and (8) of the Act The EPA believes this interpretation, while (physical changes or changes in the apply. Those provisions establish conceivable on its face, conflicts with the structure method of operation) are routinely special rules for major modifications at of NSR as a preconstruction permitting program. Under Waxman’s approach, projects that have been tracked today as part of State sources that emit, or have the potential reviewed, approved, and completed could be construction programs, a showing of to emit, less than 100 tpy, or 100 tpy or subject to retroactive NSR. administrative necessity may be more, respectively of VOC [or NOX, Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38301 consistent with section 182(f)]. These offset ratio and avoid review for that LAER must secure additional offsets to subsections offer sources options that particular unit. While some sources may separately satisfy the general offset ratio may be more desirable than would be able to plan modifications at various requirements of sections 182(c)(10) otherwise apply. Specifically, sections units over time so that each could avoid (1.2:1 ratio for serious areas) and 182(c) (7) and (8) offer sources the review through netting under section 182(d)(2) (1.3:1 ratio for severe areas, or option of obtaining 1.3:1 internal offsets 182(c)(6), the EPA believes that not all 1.2:1 if all major sources use BACT). in order to avoid NSR entirely (for sources will be able to do so, and will The EPA believes section 182(c)(8) of sources emitting less than 100 tpy), or have reason to utilize the 1.3:1 internal the Act may reasonably be interpreted to to avoid LAER (for sources emitting 100 offset ratio option. See proposed provide that the 1.3:1 internal offset tpy or more). These special provisions § 51.165(a)(1)(v)(D)(2). Once an internal ratio is in lieu of the general offset ratio. are discussed below. offset has been used to exempt a The EPA recognizes that the only (a) Modifications at Sources Emitting particular increase from NSR, the remaining NSR requirements of section Less Than 100 TPY. Section 182(c)(7) of particular increase and decrease(s) 182(c)(8) would be less geared toward the Act specifies a special rule for would not be creditable for future emissions control at the source, such as modifications at existing major netting and offset transactions. See the alternative siting analysis of section stationary sources of VOC that emit, or proposed § 51.165(a)(10)(iii). 173(a)(5) and the compliance have the PTE, less than 100 tpy. This If the source does not avoid NSR demonstration of section 173(a)(3) of the rule applies to any change [as described under the internal offset option, the Act. But the EPA believes it is in section 111(a)(4)] at the source: change is a modification subject to reasonable to believe Congress intended nonattainment NSR. When applying the to provide an incentive to obtain offsets ** * that results in any increase (other than nonattainment NSR requirements, note a de minimis increase) in emissions of internally, where the actual impact of volatile organic compounds from any that the special rule in section 182(c)(7) the new emissions may be most discrete operation, unit, or other pollutant of the Act provides that BACT is to be precisely counteracted. Also, the 1.3:1 emitting activity at the source * ** substituted for LAER for sources of less internal offset ratio would generally than 100 tpy. See proposed Thus, while the determination of de offset minor source growth and § 51.165(a)(10)(ii). contribute to RFP as specified in section minimis under section 182(c)(6) (b) Modifications of Sources Emitting requires that all changes within the 5- 173(a)(1)(A). Of course, if more 100 TPY or More. Section 182(c)(8) of reductions are needed to offset minor year contemporaneous period at the the Act provides a special rule for source be considered, sections 182(c) (7) source growth and contribute to RFP modifications at major stationary under section 173(a)(1)(A), the State and (8) apply to the particular change at sources of VOC that emit, or have the the discrete unit, operation or activity at may need to require offsets beyond the PTE, 100 tpy or more. This special rule 1.3:1 internal offset requirement. The issue. Sections 182(c)(7) and (8) do not applies to any change at the source apply to other previous increases within EPA requests comment on this according to the same terms as the interpretation. the 5-year period that are unrelated to special rule in section 182(c)(7). the change at issue. Of course, if the iii. Examples. Examples of the EPA’s The special rule for sources of 100 tpy proposed approach for the special contemporaneous net emissions or more is that: increase for the proposed modification modification provisions follow. Note is a de minimis increase [as defined in ** * if the owner or operator of the source that the examples also apply to NOX elects to offset the increase by a greater section 182(c)(6)], then the emissions consistent with section 182(f) reduction in emissions of VOC from other of the Act. nonattainment NSR provisions need not operations, units, or activities within the apply at all. source at an internal offset ratio of at least 1.3 (a) Example A. The special rule for sources of less to 1, the requirements of section 173(a)(2) of An existing major stationary source of VOC than 100 tpy is that the particular this title [concerning the LAER (LAER)], shall has the PTE 285 tpy of VOC and is located increase at issue: not apply * * * in a serious ozone nonattainment area. The source proposes a modification (a physical ** * shall not be considered a modification This option to avoid LAER could be change or change in the method of operation) for [purposes of sections 172(c)(5) and 173] utilized in the same circumstances as that includes the following changes in VOC if the owner or operator of the source elects described in section 182(c)(7), above. emissions: to offset the increase by a greater reduction While a source could avoid NSR +40 tpy from addition of new unit A in emissions of VOC concerned from other entirely for the proposed modification ¥30 tpy from shutdown of existing unit B operations, units, or activities within the by netting creditable emissions ¥60 tpy from the addition of control source at an internal offset ratio of at least reductions at any internal operations, equipment on existing unit C 1.3:1 * * * units, or activities at a 1:1 ratio under The shutdown of unit B and the addition of A question may arise as to what section 182(c)(6), it may nevertheless controls to unit C are proposed by the source sources would choose to utilize the have the ability to arrange proposed as federally enforceable permit conditions to 1.3:1 offset ratio where the source could modifications over time in order to occur during the period between the date of possibly avoid NSR entirely by applying permit application for the proposed avoid review under section 182(c)(7), or modification and the date the proposed creditable decreases at a ‘‘1:1 ratio’’ the LAER requirement under section modification will begin emitting. Both such that the aggregated increase 182(c)(8). In such circumstances under emissions reductions meet all criteria for remains at 25 tons or less under section section 182(c)(8), the source would have netting. As a result, the resultant project net 182(c)(6). The EPA believes that sources reason to use creditable internal of VOC from the proposed modification is may not have enough emissions decreases that were insufficient to avoid ¥50 tpy (+40 ¥30 ¥60), which is not an decreases to internally ‘‘net’’ the entire nonattainment NSR for the entire increase. Therefore, since the special proposed modification to 25 tons or project to avoid LAER for discrete units provisions may only apply to proposed less. However, where the proposed modifications that result in a net project at a 1.3:1 internal offset ratio. See emissions increase, nonattainment NSR does modification results in increases at more proposed § 51.165(a)(10)(i). not apply to this proposed modification. than one discrete unit, the source may An additional issue under section (b) Example B. have sufficient creditable internal 182(c)(8) is whether sources satisfying An existing major stationary source of VOC emissions decreases to apply a 1.3:1 the internal offset ratio of 1.3:1 to avoid has the potential to emit 90 tpy of VOC and 38302 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules is located in a severe ozone nonattainment all otherwise applicable criteria for a or modified source shall be offset by an equal area. The source proposes a modification (a creditable offset. or greater reduction, as applicable, in the physical change or change in the method of iv. Transition. For purposes of actual emissions of such air pollutant from operation) with the following VOC emissions permitting in the absence of State NSR the same or other sources in the changes: [nonattainment] area * * *. [Emphasis SIP revisions, the EPA does not intend added.] +110 tpy from addition of new unit A to apply the interpretations proposed ¥20 tpy from shutdown of existing unit B See section 173(c)(1) of the Act. +10 tpy from the addition of new unit C here for the special modification provisions of sections 182(c) (6), (7), and Elsewhere in the 1990 Amendments, The shutdown of unit B is proposed by the Congress prescribed a set of emissions source as a federally enforceable permit (8) of the Act, except that the lower significance threshold of greater than 25 offset ratios, calling for greater than one- condition. The shutdown is to occur during for-one emissions reductions, to be the period between the date of permit tpy for applicability is in effect. The EPA believes that the remainder of these applied to stationary sources of VOC application for the proposed modification according to the severity of the ozone and the date the proposed modification will special modification provisions are begin emitting. As a result, the project net is sufficiently complicated that it is nonattainment problem. Wherever NOX emissions are considered an ozone +100 tpy of VOC, which is a VOC emissions appropriate to defer implementation precursor under section 182(f), the increase subject to netting over the 5-year until State NSR rules implementing the emissions offset ratios for VOC also contemporaneous period. provisions are in place or when the EPA apply to NO emissions. For purposes takes final action on this proposal, X The proposed modification is to begin of satisfying the section 173 emissions whichever comes first. Upon emitting in 1997, so the offset provisions, new section 182 promulgation of the final rule, the EPA contemporaneous period for netting is established five separate minimum expects to review each State’s NSR SIP the calendar years 1993 through 1997. emission offset ratios, each and issue a call for any necessary Creditable VOC emissions increases and corresponding to one of five area additional SIP revisions under section decreases at the source during the classifications for ozone nonattainment contemporaneous period are +80 tpy in 110(k)(5) of the Act to ensure that areas, as follows: (1) 1.1:1 in marginal 1994, ¥60 tpy in 1996, and +100 tpy States’ NSR SIP’s are ultimately areas; (2) 1.15:1 in moderate areas; (3) from the proposed modification. The consistent with the provisions of the 1.2:1 in serious areas; (4) 1.3:1 in severe contemporaneous net emissions final rule. areas; and (5) 1.5:1 in extreme areas. > increase of +120 tpy is significant ( 25 (4) Modifications in Extreme Areas. The minimum offset ratio in the OTR is tpy). Therefore, the proposed For modifications of major stationary 1.15:1. For ozone nonattainment areas modification is major and subject to the sources of VOC [and NOX consistent outside the OTR that the EPA has special modification provisions for with section 182(f)] located in extreme categorized as nonclassifiable existing major stationary sources of VOC ozone nonattainment areas, the 1990 (transitional, submarginal, or with a PTE less than 100 tpy of VOC. Amendments eliminate the concept of incomplete/no data), the emissions The major modification is subject to de minimis altogether for purposes of offset ratio must be at least 1:1. nonattainment NSR, including a determining a major modification. New Consistent with section 173(c)(1), the requirement to provide at least 130 tpy section 182(e)(2) provides that any EPA interprets that the offset ratio, in (100×1.3) of emissions offsets. However, physical change or change in the each case, is the ratio of total actual method of operation at the source that nonattainment NSR may be avoided if emissions reductions of VOC (or NOX, the source elects to use the internal results in any increase in emissions where applicable) to the total allowable offsets alternative. Under this option, from any discrete operation, unit, or emissions increase of such pollutant the entire proposed modification is not other pollutant-emitting activity at the from the new or modified stationary subject to NSR if an internal offset of at source generally must be considered a source. least 130 tpy (100×1.3) is provided by modification subject to the part D NSR In the case of severe and extreme the source. However, it is not likely that permit requirements, regardless of any areas, section 182(c)(10) provides that this option is viable for this source of decreases elsewhere at the source. Thus, the emissions offset ratio is reduced to the size given. Another option is to the EPA is proposing to amend the both a ratio of at least 1.2:1 if the applicable avoid NSR for new unit C by providing the definition of ‘‘major modification SIP contains the requirement that all at least 13 tpy (10×1.3) of internal offsets and the definition of ‘‘significant’’ to existing major sources in such for that unit. Consequently, only unit A specifically address proposed nonattainment areas must use BACT for would be subject to NSR. modifications of major stationary the control of VOC emissions. Because If in this example the existing major sources of VOC (and presumptively BACT changes over time as technologies stationary source has the PTE 100 tpy or NOX) in extreme areas for ozone. The advance, some methodology must be greater, then nonattainment NSR applies proposed change would reflect the adopted for States to demonstrate that to the major modification, except that statutory requirement by requiring that all existing sources in a given the LAER provision will not apply if the any increase in emissions from any nonattainment area have met the BACT source elects to provide internal offsets discrete operation, unit, or permit requirement in section 182(d)(2). In the at a ratio of at least 1.3:1. The remaining emitting activity at a source locating in PSD program, BACT applies to new part D nonattainment NSR provisions an extreme ozone nonattainment area is sources at the time of permitting. In the still apply. Alternatively, the source considered ‘‘significant’’ and, thereby, a context of existing sources, this may elect either to avoid LAER for the major modification. See proposed requirement could conceivably apply at entire modification if at least 130 tpy of §§ 51.165(a)(1)(v)(E) and a fixed point in time, or might apply internal offsets is secured or to avoid 51.165(a)(1)(x)(F)]. continuously so that existing sources LAER for new unit C if at least 13 tpy d. Emissions Offset Ratios. The 1990 must be using technology that of internal offsets is provided. Note than Amendments clarified the existing constitutes BACT at particular intervals. an emissions reduction at the source statutory offset requirements under part The EPA believes that it may be most occurring prior to the 5-year D of title I of the Act by stipulating that: appropriate to require BACT as of the contemporaneous period may be used as ** *the total tonnage of increased time the attainment demonstration is an internal offset to the extent it meets emissions of the air pollutant from the new due, so that the technology and offsets Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38303

requirements will be consistent with the 2. Provisions for Carbon MoNOXide and 173 requirements not later than overall attainment plan. Alternatively, it (CO) Nonattainment Areas November 15, 1992. Unless otherwise may be appropriate to require BACT as New subpart 3 of part D of the Act noted, all moderate areas above 12.7 of the time the permitting program that contains new NSR requirements for CO ppm are also to meet those requirements would switch the offset ratio to 1.2:1 is nonattainment areas as determined by applicable to moderate areas below 12.7 adopted. The EPA requests comment on the area’s CO design value. The 1990 ppm. c. Serious Areas. As specified in the appropriate methodology for Amendments established an area section 187(c)(1), for serious CO applying the BACT requirement in classification system for the CO nonattainment areas in which stationary section 182(d)(2) to existing sources. nonattainment air quality problem sources contribute significantly to CO The EPA is proposing the minimum based on the area’s CO design value. levels (as determined according to rules offset ratios in ozone nonattainment Only two types of area classifications areas and in the OTR in accordance issued by the Administrator), a SIP shall are defined in section 186 for CO be submitted by November 15, 1992, with the 1990 Amendments. See nonattainment areas— moderate and proposed § 51.165(a)(14). that provides that ‘‘major stationary serious. source’’ includes any stationary source For extreme ozone nonattainment The major stationary source threshold areas section 182(e)(2) also provides for that emits or has the PTE 50 tpy or more for moderate areas is 100 tpy. Pursuant of CO. If stationary sources do not an exemption from the section 173(a)(1) to section 187(c), the EPA is proposing offset requirements if the owner or contribute significantly to CO levels to amend the definition of ‘‘major under section 187(c)(1), then ‘‘major operator of the major stationary source stationary source’’ to incorporate a stationary source’’ includes any agrees to offset any proposed increase lower emissions threshold of 50 tpy for stationary source that emits or has the by a greater reduction in onsite serious areas in which stationary potential to emit 100 tpy or more of CO. emissions from other discrete sources are significant contributors to d. Nonclassifiable Areas. The operations, units, or activities at an CO levels as determined by the ‘‘nonclassifiable’’ category of CO internal offset ratio of 1.3:1. EPA is Administrator. See proposed nonattainment areas is comprised of two proposing this exemption for extreme § 51.165(a)(1)(iv)(A)(1)(vi). Also, for subcategories—’’not classified’’ and ozone nonattainment areas at proposed such CO moderate areas, EPA is ‘‘incomplete/no-data.’’ The EPA § 51.165(a)(15). The remaining part D proposing a significance threshold of 50 describes an area as ‘‘not classified’’ if NSR provisions still apply. In addition, tpy for defining a major modification at the area was designated nonattainment this new section stipulates that the an existing major stationary source of both prior to enactment and (pursuant offset requirements do not apply in CO. See proposed § 51.165(a)(1)(x)(E). to section 107(d)(1)(C) of the Act) at extreme areas if the modification In addition to the two classifications enactment and if it did not violate the consists of installing equipment for CO nonattainment areas, some primary NAAQS for CO in either year required to comply with the applicable nonattainment areas do not fit into the for the 2-year period 1988 through 1989. implementation plan, permit, or the Act classification scheme and are The EPA defines an ‘‘incomplete/no- itself. The EPA notes with respect to considered ‘‘nonclassifiable’’ CO data’’ area as an area that retained its this offsets exemption in extreme areas nonattainment areas. The following nonattainment designation at enactment that the State must nonetheless account discussion describes the EPA’s [under section 107(d)(1)(C)] but for for collateral increases in emissions proposed NSR requirements for all CO which data are not available to indicate associated with installation of nonattainment areas (moderate, serious whether or not violations of the equipment required to comply with and nonclassifiable). Like those for standard have occurred. For a more another legal mandate. For example, ozone, the NSR requirements for CO are detailed discussion of nonclassifiable where a source incinerates VOC in order additive (i.e., a serious area has to meet CO nonattainment areas, see the General to limit VOC emissions, NOX emissions all moderate requirements in addition to Preamble (57 FR 13535). The specific may increase. The State may still all serious requirements, etc.). requirements of subpart 3 of part D of require offsets as an approach more Requirements discussed for moderate the Act do not apply to CO ‘‘not stringent than that the Act provides, or areas will be repeated for serious areas classified’’ and ‘‘incomplete/no data’’ must otherwise ensure that such only if the requirements are different. areas. However, because these areas are increases in emissions are counteracted a. Moderate Areas with a Design designated nonattainment, the by other SIP measures so as to comply Value of 12.7 Parts Per Million and requirements of section 172(c)(5) apply. with sections 110(a)(2)(C) and Below. The part D NSR requirements of Therefore, States with CO 173(a)(1)(A) of the Act. Of course, any section 173 apply in CO nonattainment nonattainment areas classified as ‘‘not increase is still subject to the LAER areas. All States with moderate CO classified’’ or ‘‘incomplete/no data’’ technology requirement, even where nonattainment areas with a design value areas, are required to adopt part D NSR offsets are not applicable. The EPA of 12.7 parts per million (ppm) or less programs meeting the requirements of encourages States to require alternatives must submit proposed part D NSR section 173, as amended. As required by for compliance with legal mandates that programs no later than November 15, section 172(b), States’ changes to NSR minimize collateral emissions increases, 1993. The provisions of these plans SIP’s for such areas were due to the EPA so that the State’s obligation to must be developed in accordance with no later than 3 years (November 15, counteract such increases will also be the requirements of sections 172(c)(5) 1993) from designation under section minimized. Finally, pursuant to section and 173 of the Act. 107(d)(4)(A)(ii). 182(e)(2) of the Act, EPA is also b. Moderate Areas with a Design proposing that, in extreme ozone Value Greater than 12.7 Parts Per 3. Provisions for PM–10 Nonattainment nonattainment areas, sources need not Million. In the General Preamble (57 FR Areas offset emissions increases of VOC 13533), the EPA interpreted sections This proposal also adds certain new resulting from modifications consisting 187(a)(7) to require that all CO requirements pertaining to PM–10 to the of equipment that is needed to comply nonattainment areas with a design value nonattainment NSR permit regulations with a SIP, permit, or Act requirement. greater than 12.7 ppm submit part D at 40 CFR 51.165. These particular See proposed § 51.165(a)(15) NSR programs meeting section 172(c)(5) changes are being made in accordance 38304 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules with new statutory provisions contained Congress determined that stationary defining a significant increase in in new subpart 4 of part D of the Act. sources emitting 70 tpy or more of PM– emissions of any PM–10 precursor, the Prior to the 1990 Amendments, 10 emissions must be considered major EPA is proposing a 40 tpy threshold. designations identifying the attainment stationary sources. See section 189(b)(3) See proposed § 51.165(a)(1)(x)(D). This status of an area pursuant to section of the Act. Therefore, the EPA is proposed threshold is the same 107(d) did not exist for PM–10. proposing to amend the current emissions rate used to define significant Consequently, new and modified definition of ‘‘major stationary source’’ emissions increases individually for stationary sources were not required to to add a 70 tpy major source threshold SO2, NOX, and VOC. Thus, the 40 tpy undergo preconstruction review under for any stationary source of PM–10 threshold would be used to determine NSR nonattainment permit located in a serious area for PM–10. See whether a major modification would requirements based on the amount of proposed § 51.165(a)(1)(iv)(A)(1)(i) This occur under the part D NSR PM–10 which they could emit. The new emissions threshold would apply requirements with respect to each 1990 Amendments established an area to new stationary sources of PM–10, as proposed net emissions increase of a classification system under section 188 well as existing major sources proposing PM–10 precursor from a major to define the severity of the air quality a modification resulting in an increase stationary source of that PM–10 problem in designated nonattainment in PM–10 emissions. An existing major precursor, except in areas where the areas for PM–10. Only two types of area stationary source of PM–10 would be Administrator determines that the classifications for PM–10 nonattainment considered a major modification when it sources of PM–10 precursors do not areas were defined—moderate and proposes a change that will result in a contribute significantly to the PM–10 serious. A detailed discussion of the significant net emissions increase. The nonattainment problem in the area. nonattainment designation process for EPA is also proposing that the proposed The EPA considered several PM–10 is contained in the General significance threshold of 15 tpy, as approaches before deciding on the use Preamble (see 57 FR 13537). described above, apply to any major of a level equal to the original a. Moderate Areas. Section modification of PM–10 in a serious PM– significance threshold in each case. One 189(a)(1)(A) of the Act provides that 10 nonattainment. approach involved the EPA’s each State with a PM–10 nonattainment c. PM–10 precursors. Section 189(e) procedures for defining the significant area classified as moderate is to submit provides that the part D NSR emissions rate for each criteria pollutant an implementation plan [as required by requirements applicable to major under the current PSD and part D NSR section 172(c)(5)] containing a permit stationary sources of PM–10 shall also programs. In selecting those existing program meeting the requirements of apply to major stationary sources of rates for the criteria pollutants, the EPA section 173 for the construction of new PM–10 precursors (SO2, NOX, and used four percent of the short-term and modified major stationary sources VOC). As described earlier, the EPA is primary standard for each pollutant as of PM–10 (and in some cases PM–10 proposing regulatory language which a design value. The design values were precursors). In moderate areas for PM– calls for each plan to subject major then converted to emissions rates in 10, new stationary sources are stationary sources of specific PM–10 accordance with EPA’s modeling determined to be ‘‘major’’ in accordance precursors to the same part D permit procedures.86 The difficulty in using with section 302(j) (also existing requirements applicable to major this approach to select a significance § 51.165(a)(1)(iv)(A)). Major stationary stationary sources of PM–10. See level for PM–10 precursors is the sources of PM–10 will be subject to proposed § 51.165(a)(13). States will not uncertainty concerning the PM–10 preconstruction review under the NSR be required to implement this particular conversion rate for each of the affected nonattainment permit regulations if they requirement in PM–10 nonattainment pollutants. Such conversion rates emit, or have the potential to emit, 100 areas where the Administrator depend on the specific chemistry of the tpy or more of PM–10 emissions (or in determines that PM–10 precursors (i.e., pollutant emissions, as well as a number some cases PM–10 precursors). No SO2, NOX, and VOC) are not significant of meteorological factors which are area- changes to the applicability contributors of ambient PM–10. specific. Thus, a standard conversion requirements are needed under the To implement the new applicability rate has not been developed that would current Federal NSR regulations to requirement for PM–10 precursors in apply to all sources emitting a particular cause major new sources of PM–10 to serious PM–10 nonattainment areas, the PM–10 precursor. undergo the necessary preconstruction EPA is proposing a major source Another approach for PM–10 review. threshold of 70 tpy or more of any precursors involved the use of the 15 The regulations currently require that individual PM–10 precursor. See tpy significance level already used for any modification to an existing proposed § 51.165(a)(1)(iv)(A)(1)(i). For PM–10 emissions under the PSD stationary source that is major for the stationary sources of PM–10 precursors regulations, and being proposed today same pollutant is subject to the part D located in moderate PM–10 for PM–10 emissions under the part D NSR requirements if the net emissions nonattainment areas, the EPA does not NSR regulations. The EPA rejected this increase of the applicable intend to propose an emissions approach, however, because of its overly nonattainment pollutant is significant. threshold different from the existing conservative nature. The EPA does not The EPA is today proposing for general threshold of 100 tpy or more of believe that it would be reasonable to nonattainment purposes a significance any pollutant. Thus, under this proposal assume a 100 percent conversion rate threshold of 15 tpy for PM–10 the existing threshold of 100 tpy would for each of the PM–10 precursors. emissions. See proposed also apply to such sources of PM–10 Careful consideration should be given § 51.165(a)(1)(x)(A). This threshold is precursors. before approving offsets between PM–10 the same emissions rate currently used The EPA is also proposing that any and PM–10 precursors. An increase in to define ‘‘significant’’ for PM–10 modification of a source emitting a PM– PM–10 emissions should not be offset emissions under the PSD regulations at 10 precursor meet the same part D by an equivalent decrease in emissions §§ 51.166 and 52.21. See, e.g., existing permit requirements that apply to of a PM–10 precursor. This is because § 51.166(b)(23)(i). modifications at major stationary a reduction of a PM–10 precursor b. Serious Areas. For nonattainment sources of PM–10. See proposed areas classified as serious for PM–10, § 51.165(a)(1)(v)(G). For purposes of 86 See 50 FR 13145, April 2, 1985. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38305 ordinarily will not negate an equivalent would have otherwise been major requirements for the issuance of NSR increase in PM–10, as not all of a PM– modifications to escape review. Finally, permits to new or modified major 10 precursor will ordinarily convert to the Agency requests comment on stationary sources in nonattainment the same mass of PM–10. The whether allowing trading among PM–10 areas or ozone transport regions. To conversion process may depend on and PM–10 precursors for offsets and issue such permits, the permit authority several variables, including the netting purposes should affect the must first find per section 173(a)(4) that availability of chemical reactants in the treatment of these emissions for major the ‘‘Administrator has not determined atmosphere for the conversion process, source threshold applicability purposes. that the applicable implementation plan and the difference in mass between the The EPA requests comment on the is not being adequately implemented for PM–10 precursor molecule and the PM– policy, technical and legal the nonattainment area’’ in accordance 10 particle that the precursor reacts to considerations regarding all of these with the requirements of part D. If the become. Another concern is that the rate issues. Administrator determines that the SIP of conversion of the precursor to PM–10 for meeting the part D requirements is 4. Statutory Restrictions for New may be so long that the precursor may not being adequately implemented for Sources not entirely convert to PM–10 within the nonattainment area where the new the same nonattainment area. Thus, The EPA is also proposing to amend source or modification wants to locate, there would be less counteracting effect its regulations at 40 CFR 52.24 which permits that would otherwise meet the and no net improvement to air quality contain restrictions on the construction requirements of section 173 cannot be in the area. or modification of new major stationary issued. The Administrator intends to Under the EPA’s proposal, a source of sources (the construction ban). The make the determination by letter to the a PM–10 precursor may offset its changes made by the 1990 Amendments permit authority, with a follow-up increased emissions with the same that alter the applicability of the notice to be published in the Federal precursor type or PM–10 (or a construction ban provisions are Register and need not undertake notice- combination of the two). In this reflected and clarified in this proposal. and-comment procedures before taking situation, a net improvement in air The EPA is also proposing that the final action. The EPA solicits comments quality would be assured. At this point, definitions contained in proposed on this method of communicating the however, the EPA is not proposing to § 51.165 also apply in § 52.24. determination. Specifically, the EPA allow offsetting among different types of Under the 1977 Amendments, section requests comments on the need for an PM–10 precursors, or offsetting PM–10 110(a)(2)(I) of the Act required the EPA opportunity for public notice and increases with reductions in PM–10 to place certain areas under a federally comment prior to making the precursors, because the Agency does not imposed construction moratorium (ban) determination effective. now have a scientific basis to propose that prohibited the construction of new While the EPA policy is generally to conversion factors. However, the or modified major stationary sources in impose a FIP where States fail to adopt Agency does not intend through this nonattainment areas where the State adequate NSR provisions, section rulemaking to preclude trading between failed to have an implementation plan 113(a)(5) of the Act provides that the PM–10 precursors at such time as meeting all of the requirements of part EPA may issue an order prohibiting the technical data supporting such a scheme D. The 1990 amendments removed the construction or modification of any is developed. The Agency expects that provision under section 110(a)(2)(I) major stationary source in any area, the approvability of a scheme allowing requiring this prohibition of including an attainment area, where the trading between precursors will be construction. However, in section Administrator finds that the State is out addressed in subsequent guidance or in 110(n)(3) of the Act (Savings Clause), of compliance with the NSR the context of individual SIP reviews, the 1990 Amendments retained the requirements. Specifically, the EPA may though the Agency is considering prohibition in cases where it was issue an order under section 113(a)(5) resolving certain policy and legal issues applied prior to the 1990 Amendments banning construction in an area in this rulemaking. based upon a finding that the area (1) whenever the Administrator finds that a The EPA believes that nothing in lacked an adequate NSR permitting State is not acting in compliance with subpart 4 of part D of the Act would program (as required by section any requirement or prohibition of the prohibit trading between PM–10 and 172(b)(6) of the 1977 Act), or (2) the Act relating to construction of new PM–10 precursors, or among PM–10 State plan failed to achieve the timely sources or the modification of existing precursors. The Agency recognizes that attainment of the NAAQS for sulfur sources. section 173(c)(1) of the Act may be dioxide by December 31, 1982. All other This proposal does not include the relevant to whether Congress intended construction bans pursuant to section transition provisions under existing to allow offsets trading among PM–10 110(a)(2)(I) are lifted as a result of the § 52.24 (c) and (g). These paragraphs precursors or between PM–10 and PM– new statutory provision. This includes were removed because they were 10 precursors, and requests comment on previously imposed construction bans originally designed to clarify the the legal, technical, and policy aspects based upon a finding that the plan for applicable requirements for permits of this issue. the area did not demonstrate timely issued prior to the initial SIP revisions Also, the EPA believes that trading attainment and maintenance of the required by the 1977 Amendments. The among PM–10 and PM–10 precursors ozone or CO NAAQS. In accordance EPA solicits comments on the removal raises significant issues, including the with the amended section 110(n)(3) of of these paragraphs. Specifically, issue of scientific uncertainty. The EPA the Act, any construction ban retained comments are requested on the possible requests comment on this issue and on remains in effect until the EPA need to maintain these paragraphs for whether or how trading should be determines that the SIP meets either the enforcement purposes for sources that allowed for netting in determining NSR amended part D permit requirements, or constructed prior to the initial SIP applicability. The scientific basis the requirements under subpart 5 of part revisions required by the 1977 supporting offsets conversions and D for attainment of the NAAQS for Amendments. trading conceptually should apply with sulfur dioxide, as applicable. In addition to the significant changes equal force to netting. But allowing such Section 173 and the various subparts already discussed, the proposed changes trading may improperly allow what of title I of the Act contain the to § 52.24 include several minor 38306 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules changes. These minor changes include: 111 or 202.’’ Congress also added a for competition, or an engine subject to (1) The addition of requirements definition of ‘‘nonroad engine’’ in standards promulgated under section applicable to transport regions, (2) the section 216(10), a definition of 202 of the Act. See proposed inclusion of requirements applicable to ‘‘nonroad vehicle’’ in section 216(11), a § 51.165(a)(1)(xxxii). criteria pollutant precursors, (3) new definition of ‘‘stationary source’’ in It is the EPA’s intent to continue to incorporation of the definitions section 302(z), and revised the existing regulate internal combustion engines proposed in § 51.165(a), (4) revisions to definition of ‘‘stationary source’’ in that function in a stationary manner as the language at § 52.24 (h) (2), and (5) section 111(a)(3). Both definitions of stationary internal combustion engines. revisions to § 52.24(j). ‘‘stationary source’’ include the Apart from engines regulated under In §§ 52.24 (b), (d), (e), and (i), the distinction between stationary and section 111 and engines used to propel EPA proposes that all the requirements nonroad internal combustion engines. a motor vehicle or a vehicle used solely of § 52.24 applicable to nonattainment Under the amended Act, emissions for competition, the proposed areas are now also applicable to from a ‘‘stationary internal combustion definitions distinguish nonroad engines transport regions. The proposed revised engine’’ are generally considered part of from stationary internal combustion regulations also incorporate a stationary source and subject to engines primarily on the basis of engine requirements for criteria pollutant control under title I State NSR permit mobility and residence time. Engines precursors. Where previously only programs. On the other hand, emissions that are permanently affixed or are criteria pollutants were covered under resulting directly from internal otherwise non-portable and non- §§ 52.24 (d) and (e), the EPA proposes combustion engines considered to be transportable are clearly stationary that the construction ban provisions of nonroad engines, or from nonroad internal combustion engines. In proposed § 52.24 now extend to major vehicles, are generally subject to addition, the definition of nonroad stationary sources of precursors of separate regulation under title II of the engine provides that while portable and pollutants for which the area is in Act. On June 17, 1994, the EPA transportable internal combustion are nonattainment or for which it is in a published regulations at 40 CFR part 89 generally to be regulated as nonroad transport region. regarding new nonroad engines and engines, those internal combustion The EPA believes that the proposed nonroad vehicles, which included engines that remain in a particular definitions at § 51.165(a) should also definitions of the two terms. See 59 FR location for over 12 months (or a shorter apply when implementing the 31306. period of time for engines operating at provisions of proposed § 52.24. Instead In today’s document, the EPA is sources with seasonal operating of listing each definition from proposing to amend the various NSR schedules) are to be treated as stationary § 51.165(a) in the amended § 52.24, the regulations by revising the definition of internal combustion engines (this EPA proposes that the definitions at ‘‘stationary source’’ to include excludes engines in self-propelled proposed § 51.165(a) apply under emissions from stationary internal equipment and equipment intended to § 52.24(f). Also, by referring to the combustion engines, and to exclude be propelled while performing its definitions in § 51.165(a), the fugitive emissions from nonroad engines and intended function). emissions language at existing § 52.24(h) nonroad vehicles, as well as from Typical stationary internal is not needed, since the applicable emissions resulting directly from an combustion engines generally include, definition is contained in the definitions internal combustion engine used for but are not limited to, engines under § 51.165(a) which the EPA is transportation purposes. See proposed associated with pipeline pump and today proposing to incorporate into § 51.165(a)(1)(i). The EPA is also compressor drives, electric power § 52.24(f). The proposed changes to proposing to complement the definition generation, and certain well-drilling existing NSR definitions and the of ‘‘stationary source’’ with new operations. Examples of internal rationale for these changes is discussed definitions addressing the terms combustion engines which, for the most in the appropriate sections of this ‘‘stationary internal combustion part, would be considered nonroad preamble which discuss proposed engine,’’ ‘‘nonroad engine,’’ and engines (and nonroad vehicles) include changes to regulations at § 51.165. ‘‘nonroad vehicle.’’ 87 See proposed diesel locomotives, farm and At § 52.24(g)(2), the EPA is proposing §§ 51.165 (a)(1)(xxxii) through construction equipment, utility engines to add that, under certain conditions (a)(1)(xxxiv), respectively. It should be (such as lawn and garden equipment), when an enforceable limitation is noted that the proposed definitions of forklifts, mobile cranes, and airport relaxed, the requirements of § 51.165(a) ‘‘nonroad engine’’ and ‘‘nonroad service vehicles. Some internal apply. vehicle’’ are the same definitions that combustion engines perform both mobile and stationary activities—i.e., 5. Applicability of Nonattainment NSR EPA promulgated under 40 CFR part 89 they are used both to propel a vehicle to Internal Combustion Engines on June 17, 1994 (59 FR 31337). As proposed, a ‘‘stationary internal and to operate some equipment or Using new and revised definitions combustion engine’’ refers to any device when the vehicle is stationary. contained in the 1990 Amendments internal combustion engine that is The EPA is proposing that such engines Congress drew a distinction between regulated by a Federal NSPS would be considered nonroad engines, emissions resulting from stationary promulgated under section 111 of the and not subject to review as stationary internal combustion engines and newly- Act, or an internal combustion engine internal combustion engines. defined ‘‘nonroad engines’’ (for that is none of the following: a nonroad The EPA notes that as part of the purposes of regulating internal engine, an engine used to propel a rulemaking on nonroad engines on June combustion engines under titles I and II motor vehicle or a vehicle used solely 17, 1994 (59 FR 31311), it is a of the Act). Section 216(10) of the Act prohibited act to attempt to circumvent defines ‘‘nonroad engine’’ as ‘‘an 87 The proposed revisions to the definition of the exclusion based on the residence internal combustion engine (including ‘‘stationary source,’’ as well as the addition of new time of a portable or transportable the fuel system) that is not used in a definitions for ‘‘stationary internal combustion engine by means of removing the engine engine,’’ ‘‘nonroad engine,’’ and ‘‘nonroad vehicle’’ motor vehicle or a vehicle used solely are also being proposed for inclusion in the PSD from its location for a period and then for competition, or that is not subject to regulations as discussed in section VI.B.3 of this returning it to that same location. In standards promulgated under sections preamble. such cases, the time between removal of Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38307 the engine and its return to service (or is required as a condition precedent to the Protocol).90 The Class I substances list replacement) would be counted toward initial retail sale, titling, or registration of the contains specific chlorofluorocarbons the time period specified in paragraph engine or equipment. The EPA believes that (CFC), specific halons, carbon States are not prevented by section 209 from tetrachloride, and methyl chloroform, (2)(iii). An example of the final sentence requiring retrofitting of nonroad engines in of paragraph (2)(iii) of the definition of certain circumstances once a reasonable time methyl bromide, and the nonroad engine is when a portable has passed after the engine is no longer new, hydrochlorofluorocarbons (HCFC); the generator engine that functions as a as long as the requirements do not amount Class II substances list contains specific permanent backup generator is replaced to a standard relating back to the original HCFC. These Class I and Class II lists by a different engine (or engines) that manufacturer. Therefore, EPA believes that also include the isomers of the listed performs the same function. In that case, modest retrofit requirements may be required substances, except for 1,1,2- the cumulative residence time of both after a reasonable amount of time (e.g., at the trichloroethane, which is an isomer of time of reregistration or rebuilding) and more methyl chloroform. Pursuant to the generators, including the time between significant retrofit requirements may be removal of the original engine and required after a more significant period of listing criteria of section 602, the installation of the replacement, would time (e.g. after the end of the useful life of Administrator may by rule add new be counted toward the consecutive the engine). substances to the lists of Class I and residence time period. Class II substances. The EPA added B. NSR Provisions for Prevention of The definition of nonroad engine methyl bromide and the Significant Deterioration includes a provision that if an engine is hydrobromofluorocarbons (HBFC) to the replaced by another engine within the As discussed below EPA is proposing Class I list pursuant to Section 602. See 12-month period, that the replacement several changes pursuant to the 1990 58 FR 65018, 65028 (December 10, engine should be considered in Amendments to the PSD rules at 40 CFR 1993). calculating the consecutive time period. 51.166 and 40 CFR 52.21 to codify some As ODS are regulated under title VI of This provision is designed to ensure of revised preconstruction permit the Act, they are pollutants ‘‘subject to that where an internal combustion requirements of part C of title I of the regulation’’ under the Act for PSD engine is necessary for the operation of Act. These changes include (1) the applicability purposes. The EPA is a stationary facility, the replacement of applicability of PSD to ozone depleting therefore proposing that new major one particular engine with another substances (ODS) regulated under title stationary sources and major would not prevent the engines from VI of the Act, and (2) the exemption of modifications of sources of these being included as part of the stationary the HAP listed under section 112 of the pollutants are subject to BACT for ODS. facility. The EPA solicits comment on Act from Federal PSD applicability. The Under section 169(1), a stationary the appropriateness of the proposed EPA is considering future rulemaking to source is major if it is one of 28 listed definition of stationary internal propose other changes to EPA’s PSD source categories and it emits, or has the combustion engine and of the program in light of the 1990 PTE, 100 tpy or more of any air appropriateness of incorporating the Amendments. pollutant. Likewise, for other source same definition of nonroad engine as categories, the major stationary source 1. Stratospheric Ozone-Depleting threshold is 250 tpy. Absent an EPA was promulgated in part 89. Substances The EPA published on June 17, 1994 determination of a ‘‘significance level’’ (59 FR 31339) an interpretative rule as New title VI of the Act, entitled for a particular pollutant, a modification an appendix to 40 CFR part 89 ‘‘Stratospheric Ozone Protection,’’ at a major stationary source resulting in any net increase in emissions of the explaining the EPA’s views concerning regulates the production and pollutant is subject to the PSD the ability of States to regulate internal consumption of substances that deplete requirements. See existing combustion engines manufactured prior the stratospheric ozone layer. These § 52.21(b)(23)(ii). to the effective date of part 89, as well substances are typically used as The EPA is proposing that the ODS as the ability to impose in-use refrigerants for both household and listed under section 602 be aggregated restrictions on nonroad engines. commercial purposes, and for other as a single pollutant for PSD Paragraphs 1 and 2 of the Appendix common uses such as fire suppression, applicability purposes. See proposed relating to engines manufactured prior solvents, and foam blowing. Methyl §§ 51.166(b)(23)(i) and 52.21(b)(23)(i). to the effective date of part 89 have been bromide is also a listed ozone depleting Since these substances are in many remanded to EPA and ordered to be substance that is used as a broad cases used for the same purposes and vacated pursuant to a voluntary motion spectrum biocidal agricultural fumigant. 88 can be substituted for each other, and by EPA to the Court of Appeals for the Pursuant to section 165(a)(4) , the PSD because the nature of their District of Columbia Circuit. The EPA regulations apply to all pollutants 89 environmental impact is the same, the expects to give further consideration to regulated under the Act. See also, e.g., EPA believes it is appropriate to the interpretations in these paragraphs existing § 51.166(b)(23)(ii). aggregate them as a single pollutant for in a separate action. The full text of the Section 602 of title VI of the Act lists purposes of PSD applicability. Also, remaining paragraph (paragraph 3) of ODS for regulation and classifies the treating ODS as a single pollutant is the appendix is repeated here: substances as either Class I or Class II. The Class I list includes the substances similar to treatment of VOC for PSD 3. Moreover, EPA believes that States are previously regulated to implement the purposes. Like VOC, ODS have varying not precluded under section 209 from Montreal Protocol on Substances that levels of environmental impacts (or regulating the use and operation of nonroad Deplete the Ozone Layer (Montreal reactivity), but PSD applicability for engines, such as regulations on hours of VOC is nevertheless based on a total usage, daily mass emission limits, or sulfur 88 limits on fuel; nor are permits regulating Section 165(a)(4) of the Act provides that, in 90 such operations precluded once the engine is order to obtain a PSD permit, a source must be Prior to enactment of the new title VI, on ‘‘subject to the BACT for each pollutant subject to placed into service or once the equitable or August 12, 1988 (53 FR 30566) the EPA published regulation under this Act emitted from, or which rules implementing the Montreal Protocol. These legal title to the engine or vehicle is results from, such facility.’’ (Emphasis Supplied.) rules regulate CFC 11, 12, 113, 114, 115 and halons transferred to an ultimate purchaser, as long 89 Note that new section 112(b)(6) of the Act 1211, 1301 and 2402 as ODS. The PSD regulations as no certification, inspection or other exempts the HAP listed under section 112 from the applied to the ODS regulated under the Montreal approval related to the control of emissions PSD provisions of part C of title I. Protocol. 38308 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules mass of emissions without adjustment be substituted for each other because least where the switch will not increase for reactivity. some within the same group may not be emissions of any other pollutant which As part of the same proposed change, substitutes, and because substitutes may would impact a NAAQS, PSD the EPA is proposing a significance exist across groups. (Of course, as increment, or air quality-related value, level of 100 tpy for determining PSD discussed below, HCFC may be will not cause any cross-media applicability to modifications at major substituted for CFC.) Under this concerns, and will not increase any risk stationary sources that result in a net alternative, the major source thresholds associated with toxic or HAP. increase in emissions of aggregate ODS. and the significance level would apply The EPA is proposing this approach The EPA has determined significance independently for each group of as a regulatory exclusion. The title VI levels for all other pollutants based on substitutable ODS. The EPA requests program is designed to force such the local ambient impact associated comment on this option, and on the substitution in order to reduce the with that particular amount of appropriate groupings of ODS under harmful effect of ODS on the emissions. Since emissions causing such an approach. stratospheric ozone layer, and the stratospheric ozone depletion is strictly The EPA notes that the termination Agency encourages voluntary or early a global problem, no appreciable local date for production and consumption 91 substitution. Because substitution of ambient impact will result from of halons passed with the end of 1993, less potent ODS for more potent ODS is emissions from a particular source. and that the termination date for a primary goal of the EPA’s ODS Among regulated pollutants, ODS are production and consumption of the CFC regulatory program, the Agency believes unique in this regard. Also, the global was the end of 1995. Therefore, that an existing major stationary source stratospheric ozone impact from a significant increases in emissions of that emits ODS should be able to make particular source is far below an amount halons and CFC are not likely to occur a change to use other ODS with less that would have a measurable local after final promulgation of this rule. ozone-depleting potential without ambient impact. In addition, the EPA Rather, the EPA understands that it triggering PSD review. So long as the believes that title VI constitutes a fairly intends that the termination of modifications needed to accomplish comprehensive approach to addressing production and consumption of the such substitution do not result in an ODS emissions, including a program to more potent ODS will force users to increase of the production capacity of recycle and reduce emissions under substitute less potent ODS. The most the ODS-emitting equipment, the EPA section 608 of the Act. common switch is the substitution of believes that applying PSD and the On the other hand, the Act provides the lower ozone-depleting potential BACT requirement would not be within that a new source emitting 100 tpy of HCFC for the higher ozone-depleting the intended scope of the PSD program. ODS (and for some source categories potential CFC. Much of this will have However, if the physical change or 250 tpy) should be subject to PSD been accomplished by the time of final change in the method of operation is review, including the BACT promulgation of this rule. other than what is needed to requirement. The EPA believes that PSD Currently, the EPA’s regulations accommodate the switch in ODS, and if should apply to any modification at a would appear to require that any there is a significant net emissions major stationary source that would increase in the mass of emissions from increase of 100 tpy or greater of ODS, result in a net emissions increase in a non-routine change involving then the change is a major modification ODS of at least 100 tpy, which is the substitution of HCFC for CFC would subject to PSD and the BACT lower major source threshold. This is trigger PSD review. Existing equipment requirement. Accordingly, to implement consistent with the purposes of this policy regarding ODS substitution, in many cases may have to be altered or Congress in enacting the PSD provisions the EPA is proposing to provide that replaced to accommodate the substitute to identify facilities which are such substitutions would not be ODS. Since the EPA’s title VI program responsible for deleterious pollution considered a physical change or change is geared toward forcing such changes and which, due to their size, are in the method of operation, and because they are environmentally financially able to bear the costs therefore would not be a major beneficial, the EPA has indicated that it imposed by PSD. See Alabama Power modification for PSD purposes. See will consider treating such substitutions Co. v. Costle, 636 F.2d 323, 353 (D.C. proposed §§ 51.166(b)(2)(iii)(N) and 40 as pollution control projects. The EPA Cir. 1979) (discussing Congress’s intent CFR 52.21(b)(2)(iii)(N). in enacting PSD provisions). However, issued policy concerning pollution The EPA recognizes that the very for the reasons discussed above, the control projects in a July 1, 1994 specific assessment of ozone-depleting Agency believes that the global ambient memorandum from John S. Seitz, potential for all listed substances under impact of emissions below that Director, OAQPS, entitled ‘‘Pollution section 602 of the Act also may support threshold are de minimis. The EPA Control Projects and New Source a broader incorporation of relative requests comment on its proposed 100 Review (NSR) Applicability.’’ The EPA ozone-depleting potential into PSD tpy significance level for ODS. also took the position that the proposed applicability for all ODS-related Commenters should specify the basis for substitution of HCFC–141b for CFC–11 modifications. In short, as noted above, any other suggested significance level. at Whirlpool Corporation’s Forth Smith, EPA is considering an alternative The EPA is also considering an Arkansas facility would qualify for a whereby all modifications would be alternative whereby groups of ODS that case-by-case exclusion from PSD review assessed on a weighted basis relative to may be used for the same purposes as a pollution control project.92 See 57 their ozone-depleting potential. Under would be aggregated, but that those that FR 32314, 32320 (July 21, 1992) this alternative approach, any increase are used for different purposes and (explaining that the EPA will consider in amount of ODS emitted as a result of cannot be substituted for each other pollution control projects on a case-by- a change to a substance with lower would be treated separately for PSD case basis). This may be appropriate at ozone-depleting potential would be applicability. The current groupings discounted by the relative ODP of the under section 602 may represent such 91 Consumption equals production plus imports new substance. For example, if a facility minus exports. use groups. The EPA recognizes, 92 Letter from A. Stanley Meiburg, U.S. EPA using 500 tpy of CFC–11 (with an however, that these groups may not Region VI, to Randall Mathis, Arkansas Department ozone-depleting potential of 1.0) sufficiently represent chemicals that can of Pollution Control and Ecology (February 1, 1994). switched to use 1000 tpy of an HCFC Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38309 with an ODP of 0.1, there would and must be reduced (and ultimately ozone-depleting potential, from the actually be a decrease in total ozone- eliminated), and where PSD review may project. The Agency requests comment depleting potential, and PSD review constitute a tool for reducing ODS on whether a project involving would not apply. This approach is emissions associated with major new expansion in plant capacity or arguably consistent with the purpose of construction. The EPA therefore utilization may reasonably be PSD to prevent deterioration in air believes that it has discretion to apply considered part of a pollution control quality. To the extent a switch in ODS PSD in a straight-forward manner under project. In any case, even if the Agency actually reduces overall ozone-depleting section 165 to unadjusted mass does not allow such projects to qualify potential, no deterioration in air quality increases where sources are expanding as a pollution control project, if the would result. Were the EPA to adopt capacity in order to ensure BACT is Agency adopts the ozone depletion this alternative approach, it would be applied to such modifications. weighting alternative for all consistent for purposes of the PSD The EPA believes this alternative modifications, substitutions that occur netting calculation to adjust the mass of could promote early substitution of less before the final rule may still generate each ODS involved based on its ozone- potent ODS to support expansion in credit to support expansions later in the depleting potential to determine if a capacity. The EPA is also sensitive to 5-year contemporaneous period after modification results in a significant net any incentive it might provide to delay promulgation of the final rule. The EPA emissions increase. substitution until the source is ready for requests comment on this view. The EPA recognizes that the plant expansion or other physical or significant variation in ozone-depleting operational changes that may result in a 2. Listed Hazardous Air Pollutants potential could allow substantial plant significant net increase in ODS. Since (HAP) expansions contemporaneous with the sources could utilize credit from Under the 1977 Act Amendments and elimination of a substance having a substitution throughout the 5-year regulations issued thereunder, the PSD higher ozone-depleting potential. This contemporaneous period for netting, the requirements of the Act apply to all approach would thus allow a source incentive to delay substitution may be ‘‘major’’ new sources and ‘‘major that builds new units limited to unusual situations where a modifications,’’ i.e., those sources contemporaneously with a substitution source has flexibility to delay exceeding certain annual tonnage to avoid PSD (and the pollution substitution for 5 years and is aware of thresholds. See, e.g., existing minimization opportunity it affords), construction it intends to commence §§ 51.166(b)(2)(i) and (b)(23)(i). whereas a ‘‘green field’’ source simply long in the future.93 The Agency expects Typically, new sources and building the new units would be subject that the extra incentive for substitution modifications become subject to PSD to PSD. Nevertheless, from an this approach will provide should because their potential emissions environmental impact standpoint, this outweigh any risk of an incentive to exceed the specified tonnage threshold is arguably no different than an existing delay substitution. The EPA requests for a criteria pollutant (i.e., a pollutant utility replacing an uncontrolled NOX- comment on this alternative approach. for which a NAAQS has been emitting boiler contemporaneously with The EPA specifically requests that established under section 109 of the the construction of several well- commenters address the incentives this Act). For a major new source, the PSD controlled new boilers. alternative would create, the legal basis requirements apply to every pollutant Still, section 165 of the Act specifies for adjusting mass emissions in light of subject to regulation under the Act that preconstruction review requirements for the ozone-depleting potential and the is emitted in ‘‘significant’’ quantities or, construction of ‘‘major emitting costs and benefits of applying BACT in the case of a modification to an facilities,’’ defined in section 302(j) in and other PSD requirements to the existing major source, for which there is terms of tons of pollutant emitted per variety of ODS-emitting sources. a significant net emissions increase. See, year. These provisions do not Finally, the Agency is again aware e.g., existing § 52.21(b)(23)(i). Under the specifically consider the relative that the phaseout schedule for the CFC 1977 Act Amendments, BACT and other reactivity of pollutants in determining and halons is likely to prompt the bulk PSD requirements applied not only to whether PSD applies. The general rule of substitution to HCFC even before the emissions of criteria pollutants but also is that physical or operational changes Agency takes final action on this rule. to emissions of pollutants regulated that do not increase emissions on a As noted above, the Agency has already under other provisions of the Act, such plant-wide basis are excluded from the taken the position for one such facility as section 111 or section 112. This PSD program because Congress that substitution of HCFC–141b for regulatory structure was altered by the intended this program to prevent CFC–11 would qualify for a case-by-case 1990 Amendments. significant increases in air pollution exclusion from PSD review as a Section 112(b)(6) of Act generally and, hence, deterioration in air quality. pollution control project, where the excludes the HAP listed in section 112 Alabama Power, 636 F.2d at 401. The project would not increase production (as well as any pollutants that may be EPA recognizes that, based on our capacity at the plant or result in added to the list) from the PSD knowledge of the reactivity of ODS, air increased utilization of existing provisions of part C. Some of the quality deterioration can be prevented capacity. The Agency may need to chemical compounds listed in (b)(1) are despite certain increases in the tpy of address whether modifications arsenic compounds, beryllium ODS emissions. involving increases in plant capacity or compounds, lead (Pb) compounds, and But the Agency does not believe it is utilization and overall reduction in total mercury compounds. These compounds obligated to adjust the increases in the ozone-depleting potential should are defined as including any unique mass of pollution on a reactivity basis qualify as a pollution control project chemical substance that contains the in order to ensure that PSD apply only based on an overall decrease in named chemical (i.e., arsenic, where an increase in the mass of emissions, weighted on the basis of beryllium, etc.) as part of the chemical’s pollution would actually deteriorate air infrastructure. These named chemicals quality. This is particularly so where 93 Nevertheless, a hypothetical source in 1997 are not independently listed on the title VI of the Act represents a might delay substitution until 2003 because it section 112(b)(1) list; however, with the wishes to preserve the credit it would get from the Congressional determination that substitution for use to avoid PSD applicability for exception of Pb, the EPA is proposing existing levels of ODS are unacceptable new construction at the plant in 2008. that the named chemicals (i.e., arsenic, 38310 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules beryllium, etc.) that are components of • Vinyl chloride. section 111. This means that the listing the compounds listed under section Pursuant to section 116 and the of a substance under section 112(r) does 112(b)(1) are, like their compounds, preservation clause in section 112(d)(7), not exclude the substance from the exempt from the Federal PSD States with an approved PSD program Federal PSD provisions; the PSD requirements. Regarding Pb, section may continue to regulate the HAP now provisions apply if the substance is 112(b)(7) states that elemental Pb (the exempted from Federal PSD by section otherwise regulated under the Act. named chemical) may not be listed by 112(b)(6) if the State PSD regulations In summary, the following pollutants the Administrator as a HAP under provide an independent basis to do so. currently regulated under the Act as of section 112(b)(1); therefore, elemental These State rules remain in effect unless January 1, 1996, are still subject to Pb emissions are not exempt from the a State revised them to provide similar Federal PSD review and permitting Federal PSD requirements because exemptions. Such provisions that are requirements: section 112(b)(6) exempts only the part of the SIP are federally enforceable. • CO; • pollutants listed in section 112. Additionally, the listed HAP continue to NOX; • be subject to any other applicable State SO2; Elemental Pb continues to be a criteria • pollutant subject to the Pb NAAQS and and Federal rules; the exclusion is only PM and PM–10; • Ozone (VOC); other requirements of the Act. for the part C rules for PSD. • The regulations specifying a The EPA is proposing that any HAP Pb (elemental); • Fluorides (excluding hydrogen significance level refer to ‘‘Pb’’ and do listed in section 112(b)(1) which are regulated as constituents or precursors fluoride); not specify whether the Pb covered is • Sulfuric acid mist; ‘‘elemental’’ or ‘‘Pb compounds.’’ As of a more general pollutant listed under • H2S; noted in the EPA’s transition section 108 are still subject to PSD as • Total reduced sulfur compounds guidance,94 the elemental Pb portion of part of the more general pollutant, (including H2S); Pb compounds (as tested for in 40 CFR despite the exemption in section • Reduced sulfur compounds 112(b)(6). For example, VOC (a term part 60, appendix A, Method 12) is still (including H2S); considered a criteria pollutant subject to which includes benzene, vinyl chloride, • CFC’s 11, 12, 112, 114, 115; the Pb NAAQS and regulated under methanol, toluene, methyl ethyl ketone, • Halons 1211, 1301, 2402; PSD. Thus, the EPA intends that the and numerous other compounds) are • Municipal waste combustor (MWC) reference to ‘‘Pb’’ in the proposed still regulated as VOC (but not as acid gases, MWC metals and MWC regulations covers the Pb portion of Pb individual pollutants such as benzene, organics. compounds. The Agency requests etc.) under the PSD regulations because • ODS regulated under title VI. comment on this position. The EPA also these pollutants are ozone precursors, The PSD program will also requests comment on whether not because they are HAP. Also, automatically apply to newly regulated references in the regulations should particulates (including Pb compounds pollutants, for example, upon final specify ‘‘elemental’’ Pb, or whether the and asbestos) are still regulated as promulgation of an NSPS applicable to word ‘‘elemental’’ might mislead the particulates (both PM–10 and PM) a previously unregulated pollutant. public to believe that only Pb that is not under the PSD regulations. Based on the remand decision on June part of a Pb compound is covered. Section 112(b)(6) provides: ‘‘The 3, 1986 by the EPA Administrator in Pollutants regulated under the Act provisions of part C (PSD) shall not North County Resource Recovery and not on the list of HAP, such as apply to pollutants listed under this Associates (PSD Appeal No. 85–2), the fluorides (except for hydrogen fluoride), section.’’ Under the plain terms of impact on emissions of other pollutants, total reduced sulfur compounds, and section 112(b)(6), PSD does not apply to including unregulated pollutants, must sulfuric acid mist, continue to be substances by virtue of their inclusion be taken into account in determining regulated under PSD.95 Because they are on the list of substances that the BACT for a regulated pollutant. When on the initial HAP list of section Administrator is to promulgate under evaluating control technologies and 112(b)(1), the following pollutants, section 112(r), Prevention of Accidental their associated emissions limits, which had been regulated under PSD Releases. Subsection (r) establishes a combustion practices, and related because they were covered by the program to prevent and minimize the permit terms and conditions in a BACT section 112 NESHAP, are now exempt consequences of an accidental release of proposal, the applicant must consider from Federal PSD applicability: the listed HAP. Section 112(r) is not the environmental impacts of all • Arsenic; intended to address emissions of these pollutants, including those not • Asbestos; pollutants outside of an accident, and regulated by PSD. Once a project is • Benzene (including benzene from certain regulated sources may have no subject to BACT due to the emission of gasoline); emissions at all outside of accidental nonexempted pollutants, the EPA • Beryllium; releases. It thus makes sense that the believes that the BACT analysis should • Mercury; • PSD program, which is designed to limit therefore consider the impact of the Radionuclides (including radon and and control emissions that occur in the various control options under polonium); ordinary course of a source’s operations, consideration on all pollutants, does not apply to substances by virtue including the section 112(b)(1) listed 94 Memorandum from John S. Seitz, Director, OAQPS, ‘‘New Source Review (NSR) Program of their listing under section 112(r). HAP previously subject to PSD, in Transitional Guidance,’’ (March 11, 1991). But, like substances listed under determining which control strategy is 95 The compound hydrogen sulfide (H2S) was section 112(b)(1), substances regulated best. Likewise, consideration of inadvertently on the section 112(b)(1) list of HAP’s under section 112(r) may still be subject alternatives to a proposed PSD source, in the 1990 Amendments. To correct this clerical to PSD if they are regulated under other as discussed in Section IV.D.7 of this error, H2S was removed from the section 112(b)(1) list by a joint resolution of Congress. The resolution provisions of the Act. For example, the preamble, may include impacts from by the Senate was on August 1, 1991, while the EPA believes that even though H2S is listed HAP and other pollutants not House resolution was on November 25, 1991. This listed under section 112(r), hydrogen directly regulated under the PSD means that the PSD provisions of the Act continue sulfide is still regulated under the program. to apply to H2S, which is still regulated under section 111 of the Act. The compound H2S is still Federal PSD provisions because it is In addition, section 112(q) retains on the section 112(r) list. regulated under the NSPS program in existing NESHAP regulations by Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38311 specifying that any standard under definition of ‘‘stationary source’’ under attainment of the NAAQS, and on the section 112 in effect prior to the date of the nonattainment NSR regulations. presence of an adequate nexus between enactment of the 1990 Amendments the new source and the shutdown C. Control Technology Information shall remain in force and effect after source. See 54 FR 27292. At that time, such date unless modified as provided Section 108(h) of the Act requires the EPA believed that adequate safeguards in the amended section. Therefore, the EPA to maintain a central database of to assure RFP were present when an requirements of 40 CFR 61.05 to 61.08, information regarding emissions control area had an approved attainment including preconstruction permitting technology, such as the RACT/BACT/ demonstration, and so relaxed the 1980 requirements, for new and modified LAER Clearinghouse. Section 108(h) regulations by allowing the crediting, sources subject to existing NESHAP also requires this information to be for offset purposes, of shutdowns that regulations, are still applicable. disseminated by the EPA to the States occur after an application for a new or To implement the new requirements and to the general public. Today, the modified major source is filed. Id. The of section 112 in the NSR program rules, EPA is proposing to require that EPA also believed that the necessary the EPA today proposes to exempt the permitting authorities submit to EPA’s assurances of RFP were lacking, and HAP listed under statutory section 112, RACT/BACT/LAER Clearinghouse, that the transactional ‘‘match’’ between including any HAP that may be added within 60 days of issuance of either a the new source and the shutdown to the lists, from the Federal PSD nonattainment NSR or PSD permit, all source was inadequate, when an area permitting requirements. See proposed requisite information on emission was lacking an approved attainment § 52.21(i)(14). Should a listed pollutant control technology contained in any demonstration, and so the Agency be removed from the list under the such permit. See proposed retained the restrictions on pre- provisions of section 112(b)(3) or §§ 51.165(a)(16), 51.166(j)(5), and application shutdowns in such cases. Id. 112(r)(3) of the Act, such pollutant 52.21(j)(5)]. at 27292–94. would be subject to the applicable PSD Section 173(d) of the Act specifically Passage of the 1990 Amendments has requirements of part C to the extent it requires such control technology significantly altered the landscape that is otherwise regulated under the Act. information from States for permitted confronted EPA at the time of the 1989 The EPA also proposes to eliminate the sources located in nonattainment areas. rulemaking. Congress significantly applicability of the PSD requirements to This proposal extends that requirement reworked the attainment planning individual HAP by deleting from the to apply to permits for PSD sources as requirements of part D of title I of the existing regulations those HAP listed well. The EPA also solicits comment on Act, such that EPA now believes it is under section 112, including beryllium, the availability of information in the appropriate to delete the restrictions on mercury, vinyl chloride and asbestos. RACT/BACT/LAER Clearinghouse. crediting of emissions reductions from See proposed §§ 52.21(b)(23)(i) and source shutdowns and curtailments that 52.21(i)(8)(i). VII. Other Proposed Changes occurred after 1990. In particular, The PSD regulations at 40 CFR A. Emissions Credits Resulting From Congress enhanced the importance of 51.166, which list the minimum criteria Source Shutdowns and Curtailments the requirement in section 172(c)(3) that for State SIP conformance, are also States prepare a ‘‘comprehensive, being amended to reflect the changes The EPA’s current regulations limit accurate, current inventory of actual mentioned above. Accordingly, the EPA the use as offsets of emissions emissions from all sources’’ in a proposes to allow States to exempt from reductions achieved by shutting down nonattainment area as the fundamental PSD the section 112(b)(1) list of HAP. an existing source or curtailing tool for air quality planning. This was See proposed § 51.166(i)(13). The EPA production or operating hours below done by restating the inventory also proposes to revise the current baseline levels. See existing requirement as the first requirement in pollutant listings by deleting the HAP § 51.165(a)(3)(ii)(C). These regulations several pollutant-specific planning which are now exempt from Federal provide that such emissions reductions provisions, most notably for ozone PSD applicability. See proposed cannot be used as new source offsets if nonattainment areas. See section §§ 51.166(b)(23)(i) and 51.166(i)(8)(i). the State lacks an approved attainment 182(a)(1) of the Act, requiring demonstration, unless the shutdown or submission of an inventory of ozone 3. Applicability of PSD Requirements to curtailment occurs on or after the date Internal Combustion Engines precursor emissions within 2 years of the new source permit application is enactment of the amendments. Congress In accordance with the provisions of filed or the applicant can establish that also required submission of a revised the amended Act, the EPA today the proposed new source is a ozone precursor inventory every 3 years proposes to revise the definition of replacement for the shutdown or thereafter. See section 182(a)(3)(A) of ‘‘stationary source’’ in the PSD curtailed source. Such shutdown or the Act. regulations to include ‘‘stationary curtailment credits may be generally In addition, Congress added several internal combustion engines,’’ and to credited if the reductions are new provisions in 1990 that are keyed exclude ‘‘nonroad engines’’ and permanent, quantifiable, and federally to the inventory requirements. Ozone ‘‘nonroad vehicles.’’ See proposed enforceable, if the area has an EPA- nonattainment areas must adopt a series §§ 51.166(b)(5) and 52.21(b)(5). approved attainment demonstration. of planning requirements including Accordingly, the EPA is also proposing In 1989, when EPA adopted the specific reduction strategies and to add new definitions to address the current regulations regarding crediting ‘‘milestones’’ that enable areas to terms ‘‘stationary internal combustion of shutdowns, it focused on the large demonstrate that specific progress engine,’’ ‘‘nonroad engine,’’ and degree of discretion granted to it under toward attainment has been made. This ‘‘nonroad vehicle.’’ See proposed the Act to shape implementing progress is measured from the 1990 §§ 51.166(b) (46) through (48) and regulations, as well as the need to ozone precursor inventory, or §§ 52.21(b) (47) through (49). The exercise that discretion in a manner subsequent revised inventories, and rationale and background for these consistent with the statutory directive must take any source shutdown or changes are the same as those provided that offsets insure that new source curtailment into account. See General in section VI.A.5. of this preamble, growth is consistent with reasonable Preamble, 57 FR 13498, 13507–13509 which describe similar changes to the further progress (RFP) toward (April 16, 1992). 38312 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

Moreover, the 1990 Amendments and (6)[Alternative 1]. Proposed milestone purposes, and (3) generate an mandate several adverse consequences Alternative 2 generally lifts the current amount of credit equal to the lower of for States that fail to meet the planning offset restriction applicable to emissions actual or allowable emissions for the or emissions reductions requirements of reductions from source shutdowns and source. Consistent with the current the amended Act that are tied to the source curtailments for all regulations, the EPA noted that all emissions inventories. For example, the nonattainment areas and all pollutants shutdown or curtailment reductions Act contains mandatory increased new where such reductions occur after the must be permanent, quantifiable, and source offset sanctions for States that baseyear of the emissions inventory federally enforceable in order to be fail to submit a required attainment used (or to be used) to meet the creditable. demonstration. The Act’s sanction for applicable provisions of part D of the The EPA clearly explained in the July failure to submit a required Act. See proposed 21, 1993 policy statement that it did not demonstration is 2:1 offsets. The 1990 § 51.165(a)(3)(ii)(C)(5)[Alternative 2]. supersede existing Federal or State Amendments also contain provisions to Neither alternative changes the current regulations or approved SIP, but require that when an area fails to attain offset restrictions with respect to their intended solely to provide guidance the air quality standard by its statutory application to emissions reductions that during the interim period prior to attainment date, EPA must bump the occur prior to the base-year of the submission and approval of attainment area up to the next higher classification emissions inventory in nonattainment demonstrations under the 1990 or the classification based on its design areas without EPA-approved attainment Amendments. The EPA also explained value, whichever is higher. Additional demonstrations. Moreover, both that it would address matters relating to regulatory requirements are imposed as alternatives allow States, if they so shutdown credits in the rulemaking a result of the higher classification. choose, to retain the current restrictions regarding regulatory changes mandated Also, sections 181(b)(4) and 185 of the on the use of shutdown and curtailment by the 1990 Amendments and would Act contain fee provisions applicable to credits for offset purposes. The EPA is take comment on its policy at that time. severe ozone nonattainment areas that seeking comments on these proposed The EPA chose to address this issue do not attain the standard by their alternatives. Discussion of the two through a policy statement rather than statutory attainment date. proposed alternatives follows. through binding regulatory changes Thus, there is now a host of negative because there was a need for immediate impacts that flow from a State’s failure 1. Shutdown Alternative 1 guidance during the interim period. The to plan for and make reductions in the In a July 21, 1993 policy statement, EPA therefore is proposing regulatory amount of pollution set forth in the the EPA reconsidered the applicability changes in light of the 1990 emissions inventories. The EPA has of these regulatory requirements for Amendments to address the tentatively concluded that, taken ozone nonattainment areas and ozone creditability of shutdown and together, these statutory changes justify attainment and unclassifiable areas in curtailment reductions. a shift away from the focus of the the OTR in light of the 1990 The EPA’s proposal regarding the current regulations on individual offset Amendments.96 The EPA explained that treatment of shutdown and curtailment transactions between a specific new States should be able to allow shutdown credits will affect a number of different source and a specific source that will be or curtailment credits to be used under circumstances. First, the EPA believes shut down, and towards a systemic conditions applicable to areas with the interim period prior to approval or approach. The EPA believes that a approved attainment demonstrations disapproval of attainment benefit from easing the shutdown until the EPA action to approve or demonstrations for ozone nonattainment restrictions is that emissions reductions disapprove a timely submitted areas will continue after the from the closing of some military attainment demonstration. The EPA also promulgation of this final rule. The installations may be available as offsets explained that, if the State is delinquent attainment demonstration for serious for new sources to build. in submitting specified SIP revisions or and above ozone nonattainment areas In this proposal, the EPA is proposing if the State’s attainment demonstration was not due until November 15, 1994, to revise the existing provisions for is disapproved, the use of shutdown and the EPA action to approve or crediting emissions reductions by credits would again be restricted to disapprove these submissions may not restructuring existing §§ (a)(3)(ii)(C)(1) those occurring on or after the filing occur until some time after that. Second, and (2) for clarity without changing the date of the new source permit areas may be designated as new ozone current requirements therein. See application (unless the applicant can nonattainment areas in the future that proposed §§ (a)(3)(ii)(C)(1) through (4). establish that the proposed new source will have future attainment dates, and if In addition, EPA is proposing two is a replacement for the one that was designated moderate or above will have alternatives which would ease, under shutdown or curtailed). The EPA also future dates for submission of an certain circumstances, the current took the position that areas not required attainment demonstration. Third, ozone restrictions on the use of emissions to submit an attainment demonstration nonattainment areas not reaching reductions as offsets from source should be allowed to follow the less attainment by the applicable dates may shutdowns and curtailments. restrictive shutdown policies applicable be ‘‘bumped up’’ to the next higher Under Alternative 1, EPA is proposing to areas in compliance with the nonattainment classification, and may for ozone nonattainment areas to lift the attainment demonstration requirements be given new future dates for current offset restriction applicable to under the current regulations. submission of an attainment emissions reductions from source The EPA also specified that creditable demonstration and for reaching shutdowns and curtailments in such shutdowns or curtailments must (1) attainment. areas without EPA-approved attainment have occurred on or after November 15, The EPA’s rationale for its July 21, demonstrations, so long as the 1990, (2) have reduced emissions that 1993 policy statement was rooted in the emissions reductions occur after are included in the emissions inventory belief that the 1990 Amendments new November 15, 1990 and the area is for attainment demonstration and RFP schedules for submitting attainment current with part D ozone demonstrations rendered the restrictions nonattainment planning requirements. 96 See Memorandum from John Seitz, Director of on the use of so-called ‘‘prior shutdown See proposed §§ 51.165(a)(3)(ii)(C)(5) EPA’s OAQPS (July 21, 1993). credits’’ as unnecessarily hindering a Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38313

State’s ability to establish a viable offset [Alternative 1]. The EPA continues to reductions from prior shutdowns or banking program. For those ozone adhere to its view in the July 21, 1993 curtailments, the State may allow offsets nonattainment areas (and areas in the policy statement that the 1990 to remain creditable if the application OTR), the EPA explained that the Amendments’ provisions for ozone was complete before the State became purposes of the prior shutdown credits nonattainment areas justify use of prior delinquent. restrictions would not be served if these shutdown and curtailment credits as Areas currently designated attainment areas were treated as if they had failed offsets in the interim period before the or unclassifiable for ozone under section to make such a demonstration. EPA approves or disapproves any 107(d)(4) of the Act may be redesignated As explained in the July 21, 1993 required attainment demonstration. The under section 107(d)(3) to policy statement, the EPA’s concern in EPA believes that the safeguards in the nonattainment, and at the time of its final action establishing the current new requirements of the 1990 redesignation will be classified by regulatory approach to shutdown credits Amendments provide adequate operation of law under section 181(b). in 40 CFR 51.165 was that unrestricted assurance of progress toward attainment The EPA is proposing that shutdown use of prior shutdown credits would so that restrictions on the use of prior and curtailment credits be available as lead to offset transactions without any shutdown or curtailment credits is not offsets in these new areas under the nexus between the decision to shut necessary. Thus, the EPA is proposing same conditions applicable to those down or curtail operations at the that prior shutdown and curtailment areas now designated as nonattainment. existing source and the decision to credits may be used as offsets in ozone Just as the ozone nonattainment construct new capacity. Thus, nonattainment areas (as well as areas in provisions of the 1990 Amendments shutdowns or curtailments that would the OTR, to the extent applicable), as provide assurance that currently have occurred in any case (not long as when they come due the State designated areas will achieve RFP and prompted by a new source seeking (1) submits a complete emissions attainment, so, too, do those provisions offsets) would not be applied to RFP, inventory for the area under section provide assurance that new ozone but would instead be used to 182(a)(1), (2) submits complete revisions nonattainment areas will achieve RFP accommodate additional emissions to its NSR program under section and attainment. growth in the nonattainment area. 182(a)(2)(C), (3) submits the 15 percent Pursuant to section 181(b)(2), ozone The EPA explained in the July 21, plan for the area under section nonattainment areas that fail to reach 1993 policy statement that the 1990 182(b)(1)(A) for moderate and above attainment by the applicable date are to Amendments merit a less restrictive areas, (4) submits the attainment be reclassified (bumped up) by approach to the use of prior shutdown demonstration for the area under section operation of law to the higher of the and curtailment credits in ozone 182(b)(1)(A) (for moderate areas) or next higher classification or the classification applicable to the area’s nonattainment areas. The EPA took the section 182(c)(2) (for serious and above position that such credits may be used design value at the time (except no area areas), (5) submits the 3 percent as offsets until the EPA acts to approve is to be reclassified as extreme). reduction plan under section or disapprove an attainment Pursuant to section 182(i), areas that are 182(C)(2)(B) for serious and above areas, demonstration that is due. The 1990 reclassified on failure to attain are to and (6) submits milestone Amendments established new meet the requirements applicable to the demonstrations under section 182(g)(2) attainment deadlines for all new classification, according to the for serious and above areas. To the nonattainment areas. Ozone prescribed schedules, except that the extent ozone nonattainment areas are nonattainment areas classified as Administrator may adjust deadlines classified marginal (or lower), States are moderate and above must submit new other than the attainment dates to the not required by the Act to submit an attainment demonstrations. (Marginal extent necessary or appropriate to and unclassifiable areas, as well as attainment demonstration, and may rely assure consistency among the required attainment areas in the OTR, are not on shutdown and curtailment credits for submissions. obligated to submit an attainment offsets. Thus, moderate areas failing to attain demonstration.) These ozone The EPA also continues to adhere to by November 15, 1996, will be nonattainment areas must adopt a series the limitations explained in the July 21, reclassified as serious and the of planning requirements including 1993 policy statement. The EPA is Administrator may revise submission specific reduction strategies and therefore proposing in Alternative 1 that dates including the date for submission ‘‘milestone’’ requirements that areas the restrictions on the use of prior of a new attainment demonstration. The demonstrate that specific progress shutdown and curtailment credits will EPA does not believe that prior toward attainment has been made. This again apply as soon as a State fails to shutdown and curtailment credits progress is measured from a specific make any of these submissions, or if should be used as offsets in such areas 1990 ozone inventory, for which any such a submission is deemed where the date for a new attainment prior shutdown or curtailment incomplete or is disapproved. These demonstration has been extended. reductions must be taken into account. limitations address the concern Having failed to reach attainment by the See General Preamble, 57 FR 13498, underlying the initial imposition of date specified in the 1990 Amendments, 13507–13509 (April 16, 1992). For these restrictions that use of prior the EPA does not believe it may pollutants other than ozone, the EPA shutdown and curtailment credits in continue to regard the new statutory stated that it would consider requests such circumstances would be provisions as providing an for relaxation of the shutdown and inconsistent with the RFP requirement. ‘‘independent assurance of RFP.’’ curtailment credits policy on a case-by- Also, if a State is late in making any of Rather, the EPA believes that it should case basis. these submissions, once the submission regard failure to attain by the applicable As Alternative 1, for ozone is made to the EPA, the State is allowed date as a delinquency rendering prior nonattainment areas in general, the EPA to implement the less restrictive shutdown and curtailment credits is proposing to adopt the policies shutdown credits policy. The EPA is unavailable as offsets. reflected in the July 21, 1993 policy also proposing that, if a State becomes Section 181(b)(3) of the Act provides statement as regulatory changes. See delinquent during review of a permit that the Administrator shall grant the proposed §§ 51.165(a)(3)(ii)(C)(5) and (6) application that relies on emissions request of any State to reclassify a 38314 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules nonattainment area in that State to a nonattainment status of an area. deterioration of air quality.’’ See also higher classification. Upon voluntary Subsequently, reductions in these section 161 of the Act. reclassification, the fixed deadlines emissions from source shutdowns or The EPA interprets existing law and applicable for the higher classified area curtailments are reductions in actual regulations to require an opportunity for may well be later than those otherwise emissions, and their use as emission State judicial review of PSD and applicable to the original classification. offsets at the statutorily-required greater nonattainment NSR permit actions For example, the attainment than 1:1 ratio constitutes progress under approved NSR SIP by permit demonstration submission date towards improved air quality. Also, for applicants and affected members of the applicable for a serious area is later than all classified ozone nonattainment areas, public in order to ensure an adequate such date for a moderate area. the Act now requires emission offsets at and meaningful opportunity for public Under alternative 1, the EPA is ratios ranging from 1.15:1 to 1.5:1 be review and comment on all issues proposing that shutdown and obtained from either the same within the scope of the permitting curtailment credits be available as nonattainment area or an area of equal decision. The EPA believes that the offsets for voluntarily reclassified areas or greater classification. opportunity for public review and under the same conditions applicable if For nonattainment areas for pollutants comment, as provided in the statute and the area were originally classified in the other than ozone, the NSR regulations regulations, is seriously compromised higher category. The EPA does not also require each applicant to perform where an affected member of the public believe voluntary reclassification modeling analyses to demonstrate that is unable to obtain judicial review of an constitutes a delinquency, and believes the major new source or modification alleged failure of the State to abide by the provisions applicable to the higher will not interfere with reasonable its NSR SIP permitting rules. classification will provide the necessary further progress and the State’s ability to Accordingly, all such persons, as well as assurance that the area will achieve RFP produce an attainment plan. The the applicant, must be able to challenge and attainment. The EPA requests applicant must not only secure actual NSR permitting actions in a judicial forum. comment on this approach. emission reductions sufficient to meet In section 307(b) of the Act, Congress the numerically calculated amount 2. Shutdown Alternative 2 expressly provided an opportunity for Under this alternative the EPA is necessary under the Act to offset the judicial review of NSR permitting proposing for all nonattainment areas associated allowable emissions increase decisions when the EPA is the and all pollutants that the current offset for the new source or modification, but permitting authority. There is no restrictions on crediting of emissions enough offsets such that the modeling indication that Congress intended that reductions from source shutdowns and demonstrates no significant adverse air citizens’ rights would be diminished curtailments be lifted where the quality impact from the proposed major upon the EPA approval of a State’s NSR reductions occur after the baseyear of new source or modification. program. Similarly, Congress has the emissions inventory used (or to be B. Judicial Review of NSR Permits provided citizens the ability to used) to meet the applicable part D challenge the failure of a major source requirements of the Act. The EPA is clarifying that the Act and to obtain the NSR permit required under In light of the NSR requirements in the EPA’s implementing regulations part C or D or the violation of such the 1990 Amendments, EPA believes require SIP to provide applicants and permit in Federal district court under that the Act now contains sufficient affected members of the public with an the citizen suit provisions of section procedures, air quality tests, penalties, opportunity for State judicial review of 304(a)(3), regardless of whether the and assurances to address air quality PSD and nonattainment NSR permit permitting authority is the EPA or a concerns in nonattainment areas lacking actions under approved NSR SIP to State. EPA-approved attainment ensure an adequate and meaningful The operative language of section demonstrations. Specifically, the Act opportunity for public review and 304(a)(3) could be read as equivalent to requires a mandatory 2:1 offset sanction comment on all issues within the scope the Federal NSR enforcement provisions for new or modified major sources in of the permitting decision as required of sections 113(a)(5) and 167, which States that fail to submit a required under parts C and D of title I. The PSD enables EPA to challenge in Federal attainment demonstration. provisions of the Act emphasize the court both construction without any Consequently, the EPA is proposing that importance of public participation in permit and construction without a continuing a prohibition on the use of permitting decisions. See section 160(5) permit that satisfies applicable NSR source shutdown and curtailment of the Act. In addition, section 165(a)(2) requirements. The EPA believes that the credits generated after the baseline year of the Act provides that no PSD permit better view is that expressed in the of the most recent inventory is not shall be issued unless ‘‘a public hearing legislative history of the 1977 warranted. has been held with opportunity for Amendments, which provided Federal Under alternative 2, the EPA believes interested persons including court jurisdiction under section 304 for that emissions reductions from the representatives of the Administrator to citizen suits directed at the failure to shutdown or curtailment of emissions appear and submit written or oral obtain any major NSR permit, but which occur after the baseyear of the presentations on the air quality impact directed citizen challenges to the terms most recent emissions inventory may be of the source, alternatives thereto, of major NSR permits to State court: fully creditable for offset purposes, and control technology requirements, and ‘‘[i]n order to challenge the legality of a that no additional nexus between source other appropriate considerations.’’ permit which a State has actually shutdowns or curtailments and the new Further, § 51.166(a)(1) provides that issued, or proposes to issue, under [the source is necessary to insure that ‘‘[i]n accordance with the policy of PSD provisions of the Act] however, a construction of the new source will section 101(b)(1) of the Act and the citizen must seek administrative result in reasonable further progress purposes of section 160 of the Act, each remedies under the State permit towards attainment. From an air quality applicable State implementation plan consideration process, or judicial review planning perspective, such emissions shall contain emission limitations and of the permit in State court.’’ Staff of the actually impacted the measurements of such other measures as may be Subcomm. on Environmental Pollution air quality used in determining the necessary to prevent significant of the Senate Comm. on Environment Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38315 and Public Works, 95th Cong., 1st Sess., provide for and implement the For the reasons discussed above, the A Section-by-section Analysis of S. 252 opportunity for State judicial review of EPA is proposing that SIP provide for and S. 253, Clean Air Act Amendments a PSD or nonattainment NSR permit judicial review in State court for PSD 36 (1977), reprinted in five Legislative action by the applicant and members of and nonattainment NSR permits issued History of the Clean Air Act the public who participated in the under parts C and D of title I, Amendments of 1977 (1977 Legislative public participation process and who respectively. See proposed History) 3892 (1977). (Section 304(a)(3) can satisfy threshold Article III standing §§ 51.165(a)(5)(iii) and 51.166(q)(6). The originated in S. 252; the House bill had requirements. EPA seeks comment on this proposal. no such provision; the conference The SIP may also provide that this C. Department of Defense (DOD) committee expanded the coverage of the opportunity for judicial review is the Concerns provision to apply to nonattainment exclusive means by which citizens may major new source review as well. See obtain judicial review of the permit, and The DOD has raised the question of H.R. Conf. Rep. No. 564, 95th Cong., 1st that all such actions for judicial review whether the NSR rules should provide Sess., reprinted in three 1977 Legislative must be filed within a reasonable period to military sources temporary History at 553). This reading is of time specified in the SIP. If the SIP exclusions from the requirement for supported by the limited case law on includes such a time limit, it must also preconstruction review of major the subject. See Ogden Projects, Inc. v. provide that if new grounds for modifications in the event of a ‘‘national New Morgan Landfill Co., Inc., No. 94– challenge arise after the review period security emergency.’’ The DOD defines CV–3048 (E.D. Pa.), Jan. 10, 1996 (slip has ended, a person may challenge the ‘‘national security emergency’’ as a op. at 5–9); see also League to Save Lake permit on such new grounds within a situation where rapid response is Tahoe, Inc. v. Trounday, 598 F.2d 1164, reasonable period specified in the SIP required on the part of a Military 1173 (9th Cir.), cert. denied, 444 U.S. after the new grounds arise. Such new Department or a DOD Component (i.e., 943 (1979). The EPA believes that grounds may be limited to new the Army, the Navy, the Air Force, the Congress intended such opportunity for information which was not available Marines, the Coast Guard when in the State judicial review of PSD and during the review period. naval service, the National Guard, and nonattainment NSR permit actions to be Finally, EPA also solicits comment on the Reserves) to respond to emergency available to permit applicants and at the extent to which judicial review of situations that make it impractical to the provisions of PSD and least those members of the public who meet the procedural requirements for nonattainment NSR permits through the can satisfy threshold standing obtaining a major NSR permit in provisions of title V of the Act may requirements under Article III of the advance of a major modification and the substitute for judicial review under the Constitution. The EPA also solicits associated increase in emissions. terms of the SIP. In August 1995 EPA comment on whether the statute should ‘‘National security emergencies’’ would issued a supplemental rulemaking instead be interpreted as providing for include situations where United States notice proposing changes to the citizen challenges to State-issued forces are introduced into hostilities or requirements of 40 CFR Part 70 permits in Federal court under section peacekeeping operations, other governing State operating permit 304(a)(3), on whether citizens should be situations where involvement in programs under title V of the Act. 60 FR given the option of proceeding in State 45529 (Aug. 31, 1995). In that hostilities is indicated, and situations or Federal court, and on whether document, EPA proposed to require that where U.S. forces are called upon to citizens should be allowed to proceed in certain activities governed by a State provide emergency humanitarian relief Federal court only if a State court review program, including the issuance or protect the public health or welfare, remedy is not provided. of a PSD or nonattainment NSR permit such as responding to civil disturbances The EPA seeks to codify its under parts C or D of title I of the Act, and natural disasters such as hurricanes, interpretation by proposing in this meet the procedural requirements of earthquakes, and wildfires. Under a action expressly to require that a SIP title V, such that there would only be a temporary national security emergency provide for judicial review by private single round of public process and EPA exclusion, in lieu of the normal parties in State court of PSD and review, as opposed to possibly preconstruction review process, the nonattainment NSR permit actions. duplicative permit issuance procedures military facility would apply for and Such review must be available to the under title I and title V. EPA solicited obtain an NSR permit, if necessary, after applicant and any person who comment, however, on whether EPA the emergency has ended. A temporary participated in the public participation review and, ultimately, judicial review national security emergency exclusion, process (unless that person can under title V should address all or only if provided, would be invoked only in demonstrate that it was impracticable to some of the requirements of PSD and emergencies that require physical or raise an objection during the comment nonattainment NSR permits. Thus, it is operational changes to military sources period, e.g., because the permit term not clear at this juncture whether EPA that are significant enough to trigger the complained of was one added to the and judicial review under part 70 will NSR permitting requirements for a final permit without prior notice) and extend to all PSD and nonattainment major modification. who can satisfy threshold Article III NSR requirements, and hence, whether The DOD believes that regulatory standing requirements. The EPA also adoption of the proposed changes to provisions to address ‘‘national security solicits comment on whether to require part 70 would obviate the need for a emergencies’’ are necessary to enable States, either instead of such a SIP separate judicial review requirement the DOD to immediately and revision requirement or in addition to under title I. The EPA will coordinate dramatically respond to support such a SIP revision requirement, to final action under both proposals, and specifically designated national security submit a legal opinion from the will take care to ensure that final action missions or civilian emergencies. The Attorney General for the State, or the under this proposal and under the absence of such emergency provisions chief attorney for an air pollution proposed revisions to part 70 are could hinder the ability of local control agency that has independent consistent and do not result in commanders to comply with legal counsel, demonstrating that the duplicative or unnecessary Presidential directives in a timely State has adequate legal authority to requirements. manner because of the time periods and 38316 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules public notice requirements involved in 52. Furthermore, in the context of Commanding Officer of the military obtaining NSR permits. responding to comments on the August facility shall be authorized to determine The EPA is requesting comment on 31, 1995 supplemental proposal and on when the exclusion under this section the need for an explicit regulatory this proposal, the EPA will consider applies. Such determination shall be exclusion in the NSR rules for ‘‘national whether temporary national security made only after the Commanding security emergencies.’’ In particular, the emergency exclusion provisions that Officer has made all reasonable efforts EPA is soliciting comment on the legal specifically address DOD sources to accommodate the emissions increase authority and necessity for such an should be added to parts 70 and 71 as without deviating from otherwise exclusion in light of Act section 118, well as to the NSR regulations. applicable permitting requirements. whether such an exclusion should be Although the EPA is not reopening the (2) If the military facility seeks to rely mandatory or voluntary for States with public comment period for the August on the temporary national security approved NSR SIP, and whether such an 31, 1995 supplemental proposal, the emergency exclusion for longer than 30 exclusion should be limited to the DOD, EPA solicits comments in this document calendar days from the date of the or whether it should be made available on whether such temporary national notice in paragraph (1), the continued to other public agencies that may be security emergency exclusion use of the exclusion must be reviewed called on to protect the public health or provisions for the DOD should be added and approved by the appropriate welfare in response to unforeseen to parts 70 and 71 and on how such Secretary of the Military Department or natural or civilian emergencies. In provisions should differ from those that Head of the Department of Defense addition, the EPA is requesting may be incorporated in the NSR Component taking into account any comment on the specific form that any regulations, should such provisions be public health, welfare, or environmental such provisions should take, including adopted for either program. concerns raised in consultation with all how to structure a definition for The DOD has suggested the following affected permitting authorities. The ‘‘national security emergency’’ that is approach for including ‘‘national authorization to continue use of the sufficiently descriptive to be security emergency’’ provisions in the temporary national security exclusion implemented as intended. NSR regulations. Sections 51.165(a), shall be required for each consecutive The August 31, 1995 supplemental 51.166, 52.21 and 52.24 would be 30-day period following the date of the proposal concerning the EPA’s amended to add a definition for notice required in paragraph (1). regulations at 40 CFR parts 70 and 71, ‘‘national security emergency’’ that is (3) During the national security that address requirements for title V based on the description of that term emergency, the Commanding Officer of operating permit programs, raised the above. A new, stand-alone paragraph the military facility shall take all issue of whether similar exclusion would be added in §§ 51.165(a), 51.166, reasonable measures, where practicable, provisions should be added to parts 70 52.21 and 52.24, entitled ‘‘Temporary to ensure that any physical or and 71 to authorize local governments exclusions for national security operational changes to the source that (and other sources) to make changes emergencies,’’ which would read as would result in an emissions increase without revising the source’s title V follows: that otherwise would constitute a major permit under specified circumstances to Each plan shall provide that actions modification are made in a manner that respond to emergencies such as natural on the part of a military facility to will minimize the emissions increase or disasters and severe weather conditions. respond to a national security otherwise minimize any potential for (See 60 FR 45560–45561) The EPA emergency that otherwise would adverse impact to public health and requested comments on this topic in constitute a major modification shall not welfare or the environment. Such response to preproposal comments constitute a major modification for the measures may include the use of submitted by State and local air purposes of this section for the duration emission controls and proper operation pollution control agencies that already of the temporary exclusion provided by and maintenance practices and/or have authority to grant temporary this paragraph, provided that the choosing materials or operating exclusions as a matter of State or local Commanding Officer of the military scenarios that minimize deviations from law. In that document, the Agency facility complies with the following existing permit terms and conditions. In solicited comment on the proper scope conditions. For the purposes of this addition, the Commanding Officer of the and terms of any such authorization section, ‘‘military facility’’ shall mean military facility shall make a reasonable provision that might be added to parts the major stationary source that is effort, where practicable, to monitor 70 and 71, including appropriate owned or operated by a United States emissions during the emergency in procedural safeguards for exercising Department of Defense Component and order to quantify the emissions resulting such authority considering the scope of that is engaged in national security or from the physical or operational the authorization. Examples of related activities. changes. procedural safeguards include prior (1) As soon as practicable, but no later (4) As soon as practicable, but no later notification of a change by the source than seven calendar days after the than 7 calendar days after the use of this requesting emergency authorization, military facility begins to use the exclusion is no longer needed, the unless prior notification is not possible, national security emergency exclusion, Commanding Officer of the military and authorization for the permitting the Commanding Officer of the military facility shall notify in writing all authority to attach conditions to the facility shall notify in writing all affected State permitting authorities and authorization, as it deems appropriate, affected State permitting authorities and EPA Regional Offices, and the to ensure that the change is being made EPA Regional Offices, and the appropriate Secretary of the Military in a manner that will cause the least appropriate Secretary of the Military Department or Head of the Department change, modification, or adverse impact Department or Head of the Department of Defense Component, that the military to life, health, property, or natural of Defense Component, that the military facility has ceased responding to a resources. The EPA believes that similar facility is responding to a national national security emergency for the considerations are appropriate in the security emergency and is using the purposes of this section. context of a temporary national security exclusion. During the 7-day notice (5) As soon as practicable, but no later emergency exclusion that might be period and the 30 calendar days after than 45 calendar days after the date of added to the NSR rules in parts 51 and the date of the document, the the notification in paragraph (4), the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38317

Commanding Officer of the military be required to undergo post- also seeks comment on whether a facility shall provide a written report to modification NSR permitting. However, national security emergency exclusion all affected State permitting authorities if the changes are not returned to their should apply to the construction of a and EPA Regional Offices, and to the pre-modification condition after the new major source where the existing appropriate Secretary of the Military cessation of the emergency, the changes military facility is not an existing major Department or Head of the DOD would be considered a ‘‘nontemporary’’ source. Component, that describes the reasons modification and they would be Finally, the EPA is interested in for relying on the exclusion, the required to undergo post-modification knowing commenters’ opinions and emissions units affected, the amount of NSR permitting. concerns about any additional increased emissions, and other The EPA is requesting comments on requirements that should or could be information needed to determine the the appropriateness and sufficiency of included, such as additional elements nature and extent to which the source the preceding suggested language for that could be included in the report on deviated from otherwise applicable inclusion in parts 51 and 52. In emissions increases resulting from permitting requirements. particular, the EPA is soliciting physical or operational changes made to (6)(i) The Commanding Officer of the comments on whether any type of respond to a national security military facility need not submit an authorization by the permitting emergency, and about the implications application to the permitting authority authority should be required before a of providing for a national security for a permit under this section if the military installation may use the emergency exclusion if such provisions physical or operational changes to the temporary national security emergency are not mandatory for all states. source resulted only in a temporary exclusion, if one is adopted. In The DOD also requested that the rules modification, that is, a modification that extraordinary circumstances, the at 40 CFR 51.161 and 51.166 be revised lasts no longer than the period of the permitting authority may have concerns to provide an exclusion from public national security emergency and that about the public health, welfare, or availability requirements for classified does not expand the capacity of the environmental impacts that would information. The EPA agrees with the source to emit at an increased level after result from an emissions increase or DOD that information properly the cessation of the emergency. other changes made at a military source classified under applicable laws, (ii) As soon as practicable, but no later to respond to a national security including Executive Orders 12958 and than 45 calendar days after the date of emergency. In such circumstances, the 12968, is not required to be made the notification required in paragraph EPA believes it may be appropriate for publicly available, and the Agency (4), the Commanding Officer of the the permitting authority to work with proposes to codify this view in the military facility shall submit an the DOD to mitigate such adverse minor and major NSR rules. As application for a permit under this impacts before the DOD facility suggested by the DOD, the EPA section in the event that the physical or continues to rely on the national proposes that ‘‘classified information’’ operational changes made at the source security emergency exclusion provision. be defined in the NSR rules as it is in response to the national security The EPA expects that the permitting defined in the Classified Procedures emergency are not temporary. For authority’s assessment in such Act, 18 U.S.C. App. 3, section 1(a), as example, a permit shall be required if circumstances would be made rapidly ‘‘any information or material that has the military facility is physically and would take into account the been determined by the United States changed or has capacity added in ways urgency with which the DOD must Government pursuant to an Executive that are not later reverted or otherwise respond to the particular emergency. order, statute, or regulation, to require actually returned to the pre- Under any version of the exclusion, protection against unauthorized modification conditions. where the permitting authority is a State disclosure for reasons of national (7) The permit application under or local agency, the EPA is requesting security.’’ The EPA notes that criminal paragraph (6)(ii) and the permitting comment on whether the Agency should penalties exist for the unauthorized authority’s actions on that application have a formal role in the process for disclosure of classified information, shall comply with the requirements of determining whether the DOD can defined as ‘‘information, which at the this section as though construction had extend use of a national security time of a violation of this section, is, for not yet commenced on the modification. emergency exclusion beyond the initial reasons of national security, specifically The DOD has provided some 30-day period. designated by a U. S. Government examples of actions that military In addition, the EPA seeks comment Agency for limited or restricted installations could be called on to take on the open-ended nature of the DOD’s dissemination or distribution.’’ 18 during national security emergencies proposed national security emergency U.S.C. 798(b). The DOD and the EPA that would result in ‘‘temporary’’ and exclusion and whether there should be believe that these laws must be read in ‘‘nontemporary’’ modifications that some limit on the total duration of the congruence with the Act and the need otherwise would be subject to major exclusion, especially where an excluded for public availability of permitting NSR. In the event of a national security activity may have the potential for an information. The Act cannot be emergency involving hostilities, the adverse impact on public health and reasonably interpreted to require a DOD may have to make physical welfare or the environment. violation of criminal law by making changes to a source to be able to paint Furthermore, when a national security classified information publicly tactical equipment at that location. emergency is expected to last for an available. As recommended by the DOD, These changes could involve the extended period (such as longer than 30 the EPA proposes that the public construction of new painting facilities. days), the EPA requests comment on availability provisions be revised as If these changes would result in whether a military facility acting under follows. Existing § 51.161(b)(1) would emissions increases but, after the such an exclusion should be required to be revised to read: cessation of the emergency they are apply for and obtain an NSR permit, if Availability for public inspection in at returned to their pre-modification necessary, at some point after the least one location in the area affected of condition, under the DOD’s suggested emergency response has commenced, the information, except for classified language, the changes would be rather than waiting until the national information, submitted by the owner or considered ‘‘temporary’’ and would not security emergency has ended. The EPA operator and of the State or local 38318 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules agency’s analysis of the effect on air indicated in the ADDRESSES section at (2) Create a serious inconsistency or quality. Classified information provided the beginning of this document. otherwise interfere with an action taken or by the Department of Defense or other planned by another agency; B. Public Comments and Public Hearing Federal agencies or contractors for such (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan agencies and designated as such will be The EPA requests public comment on programs or the rights and obligations of controlled by applicable law concerning all aspects of this proposed action. All recipients thereof; or the release of classified information. public comments must be addressed to (4) Raise novel legal or policy issues Existing § 51.166(q)(2)(ii) would be the Docket for this rulemaking and arising out of legal mandates, the President’s revised to read: received no later than October 21, 1996, priorities, or the principles set forth in the Make available in at least one location at the address indicated in the Executive Order. in each region in which the proposed ADDRESSES section at the beginning of Drafts of this proposed rule and source would be constructed a copy of this document. associated materials were reviewed by all materials, except for classified The EPA plans to convene a meeting the OMB because of the novel policy information, the applicant submitted, a of the NSR Reform FACA Subcommittee issues presented and anticipated public copy of the preliminary determination, in conjunction with the public comment interest in this action. Interagency and a copy or summary of other period. In this meeting the review materials have been placed in materials, if any, considered in making Subcommittee will review today’s the public docket in accordance with the preliminary determination. proposed rulemaking. A transcript of section 307(d)(4)(B)(ii) of the Act and Classified information provided by the the Subcommittee’s meeting, will be section 6(a)(3)(E) of E.O. 12866 Department of Defense or other Federal available for public inspection in EPA (including documents identifying the agencies or contractors for such agencies Air Docket No. A–90–37. The NSR substantive changes made between the and designated as such will be Reform Subcommittee meeting will be draft submitted to OMB for review and controlled by applicable law concerning open to the public although seating may the action proposed, and the changes the release of classified information.’’ be limited. Further information that were made at the suggestion or The EPA is proposing to adopt this regarding the specific dates, location recommendation of OMB). exclusion from public availability and starting time will be published in The EPA has prepared a draft requirements for classified information the Federal Register prior to the Regulatory Impact Analysis (RIA) for not only in §§ 51.161 and 51.166 but meeting. these proposed rules and it is included also in §§ 51.165 and 52.21. The EPA The EPA plans to hold a public in the docket for this rulemaking. The solicits comment on all aspects of this hearing on this proposed action. A EPA projects that as a result of the rule proposed provision. public hearing is scheduled for 10:00 changes being proposed today, the VIII. Additional Information a.m. to 4:00 p.m. in Research Triangle overall costs and burdens for the major Park, North Carolina on September NSR program to decrease. As shown in A. Public Docket 23,1996. A notice announcing the draft RIA for this rule, the EPA has This rulemaking action is subject to additional information about the public estimated the total annualized section 307(d) of the Act. The aspects of hearing, including the specific location, ‘‘information collection request’’ (ICR) the rulemaking action related to PSD are will be published in the Federal cost burden of the NSR permitting subject to section 307(d), in accordance Register. program under the proposed reforms to with section 307(d)(1)(J) of the Act. Persons wishing to make oral be $27.6 million. This includes costs for Pursuant to section 307(d)(1)(V), the presentations at the public hearing preparation of permit applications, Administrator hereby determines that should contact the EPA as indicated in including technology and the other aspects of this rulemaking the DATES section at the beginning of environmental impact analyses, record- action are subject to section 307(d). this preamble. The order of presentation keeping, and reporting requirements. It Accordingly, section 307(d) applies to will be based on the order in which EPA represents a projected decrease of $11.1 this entire rulemaking action. receives requests to speak. Written million in the annual ICR cost burden The public docket for this rulemaking statements in lieu of, or in addition to, to industry. The burden to State and action is A–90–37. The docket is a file oral testimony are encouraged and may local air pollution control agencies is of the information relied upon by the be any length. If necessary, oral expected to decrease by approximately EPA in the development of this presentations will be time limited. The $2.5 million, and to EPA by proposed rule (as well as interagency hearing may be canceled if no requests approximately $200,000. review materials related to the proposed to speak have been received 15 days Other cost savings will be realized by rule). The EPA will also place the prior to the scheduled hearing date. sources that avoid major NSR and thus following materials in the docket: (1) become subject to minor NSR programs Written comments EPA receives during C. Executive Order 12866 implemented at the State and local the public comment period; (2) the Section 3(f) of Executive Order 12866 levels. The greatest savings, based on transcript of the public hearing, if any; (E.O. 12866) defines ‘‘significant industry comments during the NSR (3) any documents that EPA determines regulatory action’’ for purposes of Reform Subcommittee meetings, would are of central relevance to the centralized regulatory review by the be realized due to the shorter processing rulemaking; (4) EPA’s response to Office of Management and Budget time of a minor versus major NSR significant comments; (5) any additional (OMB) to mean any regulatory action permit. Also, the streamlining of some information the final rule is based on; that is likely to result in a rule that may: of the time-intensive aspects of the and (6) interagency materials related to major source requirements would have the final rule. The docket, excluding (1) Have an annual effect on the economy a similar effect. The total industry of $100 million or more or adversely affect interagency review materials, will in a material way the economy, a sector of savings would be difficult to predict represent the record for judicial review. the economy, productivity, competition, jobs, given the diversity of industries covered See section 307(d)(7)(A) of the Act. The the environment, public health or safety, or by this program; nevertheless, every docket is available for public review and State, local or tribal governments or facility would experience less down copying at EPA’s Air Docket, as communities; time, quicker start up and resumption of Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38319 revenue generation. Further savings further assessed in the draft RIA for the at § 52.21 for PSD areas that are not would accrue the extent that the minor final rule. covered by a SIP program. Essentially a NSR technology control requirements source cannot construct without D. Regulatory Flexibility Act and mitigation measures are less costly securing a permit to ensure that the than the major source requirements and Under the Regulatory Flexibility Act, requirements of the Act are met. measures. Industry and State 5 U.S.C. 601–612, EPA must prepare Part C of title I of the Act outlines representatives reported that the and make available for public comment specific preconstruction permitting difference in emissions between minor an initial regulatory flexibility analysis requirements for new and modified and major source technology assessing the impact of a proposed rule sources constructing in areas that do not requirements are insignificant in most on small entities. See 5 U.S.C. 603. violate the NAAQS. These PSD rules, cases. The incremental cost savings Small entities include small businesses, generally require a prospective major could be quite large, however, if the small not-for-profit enterprises and new or modified source to: (1) minor source requirements are government entities with jurisdiction Demonstrate that the NAAQS and applicable. The EPA solicits further over populations of less than 50,000. increments will not be exceeded, (2) comment on the cost savings that would See 5 U.S.C. 601. However, the ensure the application of best available be derived from this proposed requirement to prepare a regulatory control technology (BACT), and (3) rulemaking. flexibility analysis does not apply if the protect Federal Class I areas from The reader should note that the ICR Administrator certifies that the rule will adverse impacts, including adverse cost burden reduction estimates in the not, if promulgated, have a significant impacts on air quality related values draft RIA are highly sensitive to the economic impact on a substantial (AQRVs). estimated impact of the proposed number of small entities. See 5 U.S.C. Similarly, Part D of title I of the Act revisions to the applicability test for 605(b). specifies requirements for major new modifications at existing major The major NSR program applies to and modified sources constructing in stationary sources. The EPA estimates new major stationary sources and major areas designated as nonattainment for a that 20 percent fewer sources will be modifications to existing major NAAQS pursuant to section 107 of the classified as major as a result of revising stationary sources, as explained Act. The part D provisions also apply to the period for establishing the baseline elsewhere in this preamble. These rules major source permitting in the Northeast for actual emissions from which to reform the existing major NSR rules, Ozone Transport Region as established calculate emissions increases to the making them less burdensome and under section 184 of the Act. The part highest 12 consecutive months generally improving the rules for any D rules generally require a major new or operation by the source. Another 6% small entities that might be affected by modified source to: (1) ensure the reduction is anticipated from the ‘‘clean the major NSR program. Accordingly, application of controls which will unit’’ and ‘‘clean facility’’ tests and the the Administrator hereby certifies that achieve the lowest achievable emission exclusion for pollution control and these rules, if promulgated, will not rate (LAER), (2) certify that all major pollution prevention projects. The EPA have a significant economic impact on sources in a State owned or controlled estimates still another 25 percent of a substantial number of small entities. by the same person (or persons) are in compliance with all air emissions modifications, which would otherwise E. Paperwork Reduction Act be subject to major NSR, would be regulations, and (3) secure reductions in excluded due to allowing sources to use The information collection actual emissions from existing sources projected future actual emissions to requirements in this proposed rule have equal to or greater than the projected calculate emissions increases rather been submitted for approval to the increase to show attainment and than requiring the calculation to be Office of Management and Budget maintenance of the applicable NAAQS based on the source’s potential to emit (OMB) under the Paperwork Reduction (offsets). A public review and comment in each case. The EPA solicits Act, 44 U.S.C. 3501 et seq. An period is required for all major source comments on these estimated impacts Information Collection Request (ICR) permit actions and some non-major on the burden reduction of revising the document has been prepared by EPA source actions. regulations for netting as proposed. (ICR No. 1230.08) and a copy may be A new source that would be major if The proposed revisions include obtained from Sandy Farmer, OPPE operated at full capacity may accept certain provisions which, while Regulatory Information Division; U.S. specific enforceable permit conditions generally intended to clarify the Environmental Protection Agency to keep its emissions below the major statutory Class I area protection process (2136); 401 M St., SW.; Washington, DC source threshold. Similarly existing under the existing PSD program and 20460 or by calling (202) 260–2740. major sources that propose improve coordination between the Section 110 of the Act requires all modifications that would produce permitting authority and the FLM (an States to adopt into their SIPs significant emissions increases as a area of the PSD rules that has been the preconstruction review programs for result of new or modified emissions subject of significant confusion and new or modified stationary sources. The units may either contemporaneously controversy), may, in certain programs must include provisions that retire existing emissions units to circumstances, place additional burdens meet the specific requirements of Part C generate emissions reductions credits or on the permit applicant and the ‘‘Prevention of Significant take permit limits on future emissions permitting authority. The EPA requests Deterioration’’ (PSD) and Part D ‘‘Plan or both to avoid major NSR. public comment on whether these Requirements for Nonattainment Areas’’ Prospective sources must conduct the proposed revisions represent a net of title I of the Act for permitting necessary research, perform the increase in costs and burdens for construction and modification of major appropriate analyses and prepare permit permitting authorities and permit stationary sources. Implementing applications with documentation to applicants in comparison with the regulations for State adoption of the two support the conclusion that their project existing rules related to the protection of NSR programs into their SIPs are meets all applicable Statutory and Class I areas. These issues are described promulgated at §§ 51.160 through regulatory, requirement summarized in more detail in the Information 51.166 and appendix S. Federal above. The specific activities are Collection Request (ICR) and will be permitting regulations are promulgated described further in the draft RIA and 38320 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules the ICR for this proposed rulemaking, minor source actions, 110 hours and F. Unfunded Mandates Reform Act which are available from OPPE at the eight hours per permit respectively. The address stated above and in the Docket EPA burden on a per permit basis is Title II of the Unfunded Mandates for this rulemaking. expected to remain unchanged—15 Reform Act of 1995 (UMRA), Public Permitting agencies, either State, local hours for all major source permits and Law 104–4, establishes requirements for or Federal, review the permit 2 hours for minor source permits. The Federal agencies to assess the effects of applications to affirm the proposed resulting cost savings is estimated to be their regulatory actions on State, local, source or modification will comply with $11 million for industry, about $2.5 and tribal governments and the private the Act and applicable regulations, million for States and local agencies and sector. Under section 202 of the UMRA, conduct the public review process, issue about $250,000 for the EPA. These EPA generally must prepare a written the permit and then verify that a source estimates are discussed in detail in the statement, including a cost-benefit has constructed and subsequently draft RIA and the Information ICR for analysis, for proposed and final rules operates in compliance with the permit this rulemaking. with ‘‘Federal mandates’’ that may conditions. The EPA, more broadly, result in expenditures to State, local, reviews a fraction of the total Burden means the total time, effort, or and tribal governments, in the aggregate, applications and audits the State and financial resources expended by persons or to the private sector, of $100 million local programs for its effectiveness. to generate, maintain, retain, or disclose or more in any 1-year. Before Consequently, information prepared and or provide information to or for a promulgating an EPA rule for which a submitted by the source is essential for Federal agency. This includes the time written statement is needed, section 205 proper administration and management needed to review instructions; develop, of the UMRA generally requires EPA to of the NSR program. acquire, install, and utilize technology identify and consider a reasonable Information that is to be submitted by and systems for the purposes of number of regulatory alternatives and sources as a part of their permit collecting, validating, and verifying adopt the least costly, most cost- application, should generally be a information, processing and effective or least burdensome alternative matter of public record given the maintaining information, and disclosing that achieves the objectives of the rule. requirements for public participation in and providing information; adjust the The provisions of section 205 do not issuing permits. See sections 165(a)(2) existing ways to comply with any apply when they are inconsistent with and 110(a)(2)(C), (D) and (F) of the Act. previously applicable instructions and applicable law. Moreover, section 205 Notwithstanding, to the extent that the requirements; train personnel to be able allows EPA to adopt an alternative other information required for the to respond to a collection of than the least costly, most cost-effective completeness of a permit is proprietary, information; search data sources; or least burdensome alternative if the confidential, or of a nature that it could complete and review the collection of Administrator publishes with the final impair the ability of the source to information; and transmit or otherwise rule an explanation why that alternative maintain its market position, that disclose the information. was not adopted. Before EPA establishes information is collected and handled any regulatory requirements that may according to EPA’s policies set forth in An Agency may not conduct or sponsor, and a person is not required to significantly or uniquely affect small title 40, chapter 1, part 2, subpart B— governments, including tribal Confidentiality of Business Information respond to a collection of information unless it displays a currently valid OMB governments, it must have developed (see 40 CFR part 2). See also section under section 203 of the UMRA a small control number. The OMB control 114(c) of the Act. government agency plan. The plan must As mentioned previously, this numbers for EPA’s regulations are listed provide for notifying potentially proposed rulemaking would provide in 40 CFR part 9 and 48 CFR chapter 15. affected small governments, enabling substantial reduction in major NSR Comments are requested on the officials of affected small governments permits, which would translate into a Agency’s need for this information, the to have meaningful and timely input in reduction in industry respondents and accuracy of the provided burden the development of EPA regulatory number of reviews by the Federal, State, estimates, and any suggested methods proposals with significant Federal and local permitting agencies. The for minimizing respondent burden, baseline for comparison is drawn from intergovernmental mandates, and including through the use of automated that of the NSR program ICR approved informing, educating, and advising collection techniques. Send comments in September 1995. A copy may be small governments on compliance with on the ICR to the Director, OPPE obtained from OPPE at the address the regulatory requirements. stated above. As a result of this Regulatory Information Division; U.S. As shown in the draft RIA for this proposal, the estimated number of major Environmental Protection Agency rule, EPA has estimated the total PSD permits is expected to decrease (2136); 401 M St., SW.; Washington, DC annualized cost of the NSR permitting from 320 to 144. Major part D 20460; and to the Office of Information program including the proposed reforms nonattainment permits would decrease and Regulatory Affairs, Office of does not include a Federal mandate that from 590 to 266. The number of minor Management and Budget, 725 17th St., may result in expenditures of $100 source actions would increase by the NW., Washington, DC 20503, marked million or more to either State, local, or combined reduction in both major ‘‘Attention: Desk Officer for EPA.’’ tribal governments in the aggregate, or source programs. The burden for PSD Include the ICR number in any to the private sector. Therefore, this permits is estimated to increase for correspondence. Since OMB is required proposed rule is not subject to the industry respondents by about 11 hours to make a decision concerning the ICR requirements of sections 202 and 205 of per permit, and the burden for part D between 30 and 60 days after July 23, the UMRA. In addition, EPA has permits should decrease by an estimated 1996, a comment to OMB is best assured determined that this proposed rule 5 hours per permit. The burden for State of having its full effect if OMB receives contains no regulatory requirements that and local permitting agencies is it by August 22, 1996. The final rule might significantly or uniquely affect estimated to decrease from 280 to 272 will respond to any OMB or public small governments, which generally do hours per permit for PSD, and stay comments on the information collection not have new source permitting about the same for part D permits and requirements contained in this proposal. authority. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38321

Executive Order 12875 (‘‘Enhancing 40 CFR Part 52 r. Adding new paragraphs (a)(1) (xxvi) the Intergovernmental Partnership’’) is Administrative practice and through (xxxiv); designed to reduce the burden to State, procedure, Air pollution control, Carbon s. Redesignating paragraph (a)(2) as local, and tribal governments of the monoxide, Hydrocarbons, (a)(2)(i); t. Adding new paragraph (a)(2)(ii); cumulative effect of unfunded Federal Intergovernmental relations, Lead, mandates, and recognizes the need for u. Revising paragraph (a)(3)(ii)(C); Nitrogen dioxide, Ozone, Particulate v. Adding new paragraph (a)(5)(iii); these entities to be free from matter, Sulfur oxides, BACT, and Class w. Adding new paragraphs (a) (6) unnecessary Federal regulation to I increments. through (16). enhance their ability to address Dated: April 3, 1996. problems they face and provides for § 51.165 Permit requirements. Carol M. Browner, Federal agencies to grant waivers to (a) * * * these entities from discretionary Federal Administrator. (1) * * * requirements. For the reasons set forth in the (i)(A) Stationary source means any building, structure, facility, installation, In accordance with the purposes of preamble, parts 51 and 52 of chapter I or stationary internal combustion engine Executive Order 12875, the EPA has of title 40 of the Code of Federal which emits or which may emit any air already initiated consultations with the Regulations are proposed to be amended as follows: pollutant subject to regulation under the government entities affected by the NSR Act. changes. From August 1992 through PART 51ÐREQUIREMENTS FOR (B) A stationary source does not June 1993 EPA convened three NSR PREPARATION, ADOPTION, AND include emissions resulting directly simplification workshops, inviting SUBMITTAL OF IMPLEMENTATION from an internal combustion engine representatives from among those PLANS used for transportation purposes, or involved with and affected by the major from a nonroad engine or nonroad source NSR permitting program. In July 1. The authority citation for part 51 is vehicle. revised to read as follows: 1993 EPA formed the NSR Reform * * * * * Subcommittee under the auspices of the Authority: 42 U.S.C. 7401–7671q. (iv)(A) Major stationary source means: CAAAC, a committee formed in 2. Section 51.165 is amended as (1) Any stationary source of air accordance with the Federal Advisory follows: pollutants which emits, or has the Committee Act (FACA) (5 U.S.C. App.) a. Revising paragraph (a)(1)(i); potential to emit, 100 tons per year or This committee is composed of b. Revising paragraph (a)(1)(iv)(A); more of any pollutant subject to representatives from industry, State and c. Amending paragraph (a)(1)(v)(C)(6) regulation under the Act, except that local air pollution control agencies, by adding the words ‘‘Standing alone,’’ lower emissions thresholds shall apply environmental organizations and other at the beginning of the sentence, and as follows: Federal agencies. The purpose of this revising the word ‘‘An’’ to read ‘‘an’’; (i) 70 tons per year of PM–10 or, Subcommittee was to provide, under the d. Revising paragraph (a)(1)(v)(C)(8); where applicable, 70 tons per year of a direction of the CAAAC, independent e. Adding new paragraphs (a)(1)(v)(C) specific PM–10 precursor, in any advice and counsel to the EPA on policy (10) through (15); serious nonattainment area for PM–10. and technical issues associated with f. Adding new paragraphs (a)(1)(v) (D) (ii) 50 tons per year of volatile organic reforming the major NSR program. through (G); compounds in any serious Specifically, the responsibilities of the g. Revising paragraph (a)(1)(vi)(C)(1); nonattainment area for ozone. (iii) 50 tons per year of volatile Subcommittee included developing h. Removing the word ‘‘and’’ at the organic compounds in an area within an draft recommendations on approaches end of paragraph (a)(1)(vi)(E)(2), adding ozone transport region except for any for reforming the major NSR rules in the word ‘‘and’’ at the end of paragraph severe or extreme nonattainment area order to reduce complexity and (a)(1)(vi)(E)(3), and revising paragraph (a)(1)(vi)(E)(4); for ozone. perceived impediments to speedy i. Redesignating paragraph (a)(1)(x) as (iv) 25 tons per year of volatile organic review of permit applications in the (a)(1)(x)(A) compounds in any severe current systems, while at the same time j. Amending newly redesignated nonattainment area for ozone. maintaining the environmental goals paragraph (a)(1)(x)(A) by adding the (v) 10 tons per year of volatile organic and benefits embodied in the current words ‘‘Particulate matter: 15 tpy of compounds in any extreme approach. Upon proposal EPA PM–10 emissions.’’ at the end of the list nonattainment area for ozone. anticipates reconvening the NSR Reform of pollutant emission rates; (vi) 50 tons per year of carbon FACA Subcommittee to review the k. Adding new paragraphs (a)(1)(x) (B) monoxide in any serious nonattainment proposed revisions which will afford through (F); area for carbon monoxide, where another opportunity for State, local and l. Revising paragraph (a)(1)(xii)(B); stationary sources contribute Tribal Governments to participate in m. Amending paragraph (a)(1)(xii)(C) significantly to carbon monoxide levels this rulemaking effort. by removing the word ‘‘reviewing’’ and in the area (as determined under rules issued by the Administrator); List of Subjects adding in its place ‘‘permitting’’; n. Adding new paragraph (2) For the purposes of applying the 40 CFR Part 51 (a)(1)(xii)(F); requirements of paragraph (a)(12) of this o. Amending paragraph (a)(1)(xxii) by section to stationary sources of nitrogen Environmental protection, removing the word ‘‘it’’ and adding in oxides located in an ozone Administrative practice and procedure, its place ‘‘the project’’; nonattainment area or in an ozone Air pollution control, Carbon monoxide, p. Revising paragraph (a)(1)(xxv) transport region, any stationary source Hydrocarbons, Intergovernmental introductory text and (a)(1)(xxv)(A); which emits, or has the potential to relations, Lead, Nitrogen dioxide, q. Removing paragraph (a)(1)(xxv)(B) emit, nitrogen oxides emissions as Ozone, Particulate matter, Sulfur oxides, and redesignating paragraphs (a)(1)(xxv) follows: BACT, LAER offsets and Class I (C) and (D) as newly redesignated (i) 100 tons per year or more of increments. paragraphs (a)(1)(xxv) (B) and (C); nitrogen oxides in any ozone 38322 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules nonattainment area classified as date of the activity or project and the satisfying this paragraph (a)(1)(v)(C)(11); marginal or moderate. emissions increase is determined by: or (ii) 100 tons per year or more of (i) Material balances, continuous (iii) The activity would occur no later nitrogen oxides in any ozone emission monitoring data, or manual than 60 consecutive months from the nonattainment area classified as a emission tests using the EPA-approved date on which the permitting authority transitional, submarginal, or incomplete procedures, where available, and made a determination, with public or no data area, when such area is conducted under such conditions as the notice and opportunity for public located in an ozone transport region. permitting authority will specify to the comment consistent with § 51.161, that (iii) 100 tons per year or more of owner or operator based on the emissions satisfied paragraph nitrogen oxides in any area designated representative performance of the (a)(1)(v)(C)(10)(iii) of this section. under section 107(d) of the Act as emission units affected by the activity or (12) Any activity undertaken at an attainment or unclassifiable for ozone project, including at least three valid existing emissions unit for which a that is located in an ozone transport test runs conducted before, and at least federally enforceable emission limit has region. three valid test runs conducted after, the been established, provided the activity (iv) 50 tons per year or more of activity or project with all operating would not require a revision to, or cause nitrogen oxides in any serious parameters which may affect emissions a violation of, any federally enforceable nonattainment area for ozone. held constant to the maximum feasible limit or condition in a permit issued (v) 25 tons per year or more of degree for all such test runs; or either under regulations approved nitrogen oxides in any severe (ii) Emission factors as specified in pursuant to §§ 51.160 through 51.166 or nonattainment area for ozone. the latest issue of ‘‘Compilation of Air under § 52.21 of this chapter. (vi) 10 tons per year or more of Pollutant Emission Factors,’’ EPA (13) Any activity undertaken at an nitrogen oxides in any extreme Publication No. AP–42, available from existing emissions unit for which a nonattainment area for ozone; or EPA, MD14, Emission Inventory and federally enforceable emission limit has (3) Any physical change that would Factors Group, RTP, NC 27711, or other been established, provided the activity occur at a stationary source not emission factors determined by the or project does not include the qualifying under paragraphs (a)(1)(iv)(A) permitting authority to be superior to replacement or reconstruction of an (1) or (2) of this section as a major AP–42 emission factors, in such cases emissions unit. (14) Any activity undertaken at an stationary source, if the change would where use of emission factors existing major stationary source, constitute a major stationary source by demonstrates that the emission level itself. provided: resulting from the activity or project (i) The activity would not require a * * * * * will clearly not increase emissions. revision to, or cause a violation of, any (v) * * * (11) Any activity undertaken at an federally enforceable limit or condition (C) * * * existing emissions unit for which a in a permit issued under either (8) The addition, replacement, or use federally enforceable emission limit has regulations approved pursuant to of a pollution control project at an been established, provided the federally §§ 51.160 through 51.166 or § 52.21 of existing emissions unit unless the enforceable emissions limit at the time this chapter; and pollution control project will result in a of the change is comparable to the (ii) The entire major stationary source significant net increase in representative emission limit that, considering the air was permitted, and received the actual annual emissions of any pollutant quality designation of the area where currently applicable emission limits for regulated under the Act and the the source is located, would result from all emissions units under either this permitting authority determines that a current review in accordance with section or regulations approved this increase will cause or contribute to either paragraph (a)(2) of this section or pursuant to § 51.166 or § 52.21 of this a violation of any national ambient air regulations approved pursuant to chapter no more than 120 consecutive quality standard or any maximum § 51.166(j), or § 52.21(j) of this chapter, months prior to the proposed activity. increase over baseline concentrations for emission units of the same class or (D) For the purposes of applying the (in accordance with § 51.166(c) or source category. The permitting requirements of this section to any § 52.21(c) of this chapter) or will have authority may presume that a source source of volatile organic compounds an adverse impact on visibility in satisfies this paragraph (a)(1)(v)(C)(11) locating in a serious or severe ozone accordance with the definition at if: nonattainment area: § 51.301(a). For the purpose of this (i) The activity would occur no later (1) A proposed modification shall not paragraph (a)(1)(v)(C)(8), in lieu of the than 120 consecutive months from the be considered to result in a significant source’s representative actual annual date of issuance of the permit, issued net emissions increase for volatile emissions, the emissions levels used for under either this section or regulations organic compounds and is therefore not the source in the most recent air quality approved pursuant to § 51.166 or § 52.21 a major modification for if the project’s impact analysis in the area conducted of this chapter, that established the net increase of volatile organic for the purpose of title I, if any, may be currently applicable emission limit for compounds (any proposed creditable used. the emissions unit; increases and creditable decreases in * * * * * (ii) The activity would occur no later emissions of volatile organic (10) Any activity undertaken at an than 120 consecutive months from the compounds at the source that are existing emissions unit for which a date of issuance of the permit, issued federally enforceable and occur between federally enforceable emission limit has under regulations approved pursuant to the date of permit application for the been established, provided the activity §§ 51.160 through 51.164, that proposed modification and the date that or project will not increase the established the currently applicable the proposed modification begins to maximum emissions rate, in pounds or emission limit for the emissions unit, emit) from the proposed modification kilograms per hour, above the maximum provided the permit was issued under results in no increase of volatile organic emissions rate achievable by the regulations that were determined by the compounds; emission unit at any time during the 180 Administrator to provide for permits (2) The provisions of this section shall consecutive days which precede the that contain emission limitations not apply to any and all discrete Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38323 emissions unit(s) (or other operations or § 52.21(c) of this chapter) or having an operating hours, production rates, and pollutant emitting activities) that are adverse impact on visibility in types of materials processed, stored, or part of a proposed modification (that is accordance with the definition at combusted for any 12 consecutive otherwise a major modification) at an § 51.301(a). months during the 120 consecutive existing major stationary source that * * * * * months that precede the commencement emits, or has the potential to emit, less (x) * * * of construction of a proposed physical than 100 tons per year of volatile (B) Notwithstanding the significant or operational change at the source, and organic compounds if such source emissions rate for ozone under any current, federally enforceable proposes creditable emissions paragraph (a)(1)(x)(A) of this section, limitations on emissions required by the reductions from the source to internally significant means any net emissions Act, including but not limited to, best offset the emissions increase from the increase, as defined under paragraph available control technology (as defined selected discrete emissions unit(s) (or (a)(1)(vi) of this section, in actual at § 51.166(b)(12)), lowest achievable other operations or pollutant emitting emissions of volatile organic emission rate, reasonably available activities) at a ratio of at least 1.3:1. compounds that would result from any control technology, or emissions (E) For the purpose of applying the physical change in, or change in the standards for hazardous air pollutants requirements of paragraph (a)(12) of this method of operation, of a major under section 112 of the Act. section to modifications at major stationary source locating in a serious or * * * * * stationary sources of nitrogen oxides severe ozone nonattainment area if such (F) In lieu of paragraphs (a)(1)(xii)(D) located in ozone nonattainment areas or net emissions increase of volatile and (E) of this section, the plan may in ozone transport regions, any organic compounds exceeds 25 tons per provide that for any emissions unit, significant net emissions increase of year. actual emissions of the unit following a nitrogen oxides is considered significant (C) For the purposes of applying the physical or operational change shall for ozone. requirements of paragraph (a)(12) of this equal the representative actual annual (F) Any physical change in, or change section to modifications at major emissions of the unit, provided the in the method of operation of a major stationary sources of nitrogen oxides source owner or operator maintains and stationary source of volatile organic located in an ozone nonattainment area submits to the permitting authority, on compounds located in an extreme or in an ozone transport region, the an annual basis for a period of 5 years nonattainment area for ozone which significant emission rates and other from the date the unit resumes regular results in any increase in emissions of requirements for volatile organic operation, information demonstrating volatile organic compounds from any compounds in paragraphs (a)(1)(x)(A) that the physical or operational change discrete operation, emissions unit, or and (B) of this section shall apply to did not result in an emissions increase. other pollutant emitting activity at the nitrogen oxides emissions. A longer period, not to exceed 10 years, source shall be considered a significant (D) For the purposes of applying the may be required by the permitting net emissions increase and a major requirements of paragraph (a)(13) of this authority if the permitting authority modification for ozone. section, where applicable, to a major determines such a period to be more (G) For the purposes of applying the stationary source of a PM–10 precursor representative of normal source post- requirements of paragraph (a)(13) of this located in a PM–10 nonattainment area, change operations. section to modifications at major the significant emission rate for a PM– * * * * * stationary sources of PM–10 precursors, 10 precursor is 40 tons per year or more (xxv) Pollution control project means: any significant net emissions increase of of that precursor. (A) Any activity or project undertaken a PM–10 precursor is considered (E) Notwithstanding the significant at an existing emissions unit which, as significant for PM–10. emissions rate for carbon monoxide its primary purpose, reduces emissions (vi) * * * under paragraph (a)(1)(x)(A) of this of air pollutants from such unit. Such (C) * * * section, a net emissions increase in activities or projects do not include the (1) It occurs within a reasonable actual emissions of carbon monoxide replacement of an existing emissions contemporaneous period to be specified that would result from any physical unit with a newer or different unit, or by the reviewing authority, except that change in, or change in the method of the reconstruction of an existing for emissions of volatile organic operation, of a stationary source in a emissions unit, and are limited to any compounds from sources locating in serious nonattainment area for carbon of the following: serious and severe ozone nonattainment monoxide is significant if such increase (1) The installation of conventional or areas the contemporaneous period shall equals or exceeds 50 tons per year, advanced flue gas desulfurization, or be the period of 5 consecutive calendar provided the Administrator has sorbent injection for SO2; years that ends with the full calendar determined that stationary sources (2) Electrostatic precipitators, year in which such increase is to occur; contribute significantly to carbon baghouses, high efficiency multiclones, and monoxide levels in that area. or scrubbers for particulate matter or * * * * * (F) Notwithstanding the significant other pollutants; (E) * * * emissions rates for ozone under (3) Flue gas recirculation, low-NOX (4) It has approximately the same paragraphs (a)(1)(x)(A) and (B) of this burners, selective non-catalytic qualitative significance for public health section, any increase in actual emissions reduction or selective catalytic and welfare as that attributed to the of volatile organic compounds from any reduction for NOX; increase from the particular change such emissions unit at a major stationary (4) Regenerative thermal oxidizers, that, at a minimum, the decrease is source of volatile organic compounds catalytic oxidizers, condensers, thermal sufficient to prevent the proposed located in an extreme nonattainment incinerators, flares, or carbon absorbers increase from causing or contributing to area for ozone shall be considered a for volatile organic compounds or a violation of any national ambient air significant net emissions increase. hazardous air pollutants; quality standard or maximum allowable (xii) * * * (5) Activities or projects undertaken increase over baseline concentrations (B) Actual emissions shall be to accommodate switching to an (in accordance with either § 51.166(c) or calculated using the unit’s actual inherently less polluting fuel, including 38324 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules but not limited to, natural gas or coal excluding any emissions limitations performing its function (such as reburning, or the cofiring of natural gas established by permits issued pursuant lawnmowers and string trimmers); or and other inherently less polluting to programs for non-major sources; (3) That, by itself or in or on a piece fuels, for the purpose of controlling (4) A permits or standard under either of equipment, is portable or emissions, and including any activity section 111 or 112 of the Act; and transportable, meaning designed to be that is necessary to accommodate (5) The EPA’s Alternative Control and capable of being carried or moved switching to an inherently less polluting Techniques documents and Control from one location to another. Indicia of fuel; Techniques Guidelines; or transportability include, but are not (6) Pollution prevention projects (B) Notwithstanding paragraph limited to, wheels, skids, carrying which the permitting authority has (a)(1)(xxviii)(A) of this section, installed handles, dolly, trailer, or platform. determined through a process consistent and operating on an emissions unit (or (B) An internal combustion engine is with § 51.161 to be environmentally units) which: not a nonroad engine if: beneficial. Pollution prevention projects (1) Has operated at a minimum of 50 (1) The engine is used to propel a that may result in an unacceptable percent of design capacity for 6 months; motor vehicle or a vehicle used solely increased risk from the release of and for competition, or is subject to hazardous pollutants are not (2) The pollution control efficiency standards promulgated under section environmentally beneficial; and performance has been verified with 202 of the Act; (7) Installation of a technology, for either: (2) The engine is regulated by a purposes set forth in paragraph (i) A performance test; or Federal new source performance (a)(1)(xxv) of this section, which is not (ii) Performance data collected at the standard promulgated under section 111 listed in paragraphs (a)(1)(xxv)(A)(1) maximum design capacity of the of the Act; or (3) The engine otherwise included in through (5) of this section but meets the emissions unit (or units) being paragraph (a)(1)(xxxii)(A)(3) of this following: controlled, or 90 percent or more of the section remains or will remain at a (i) Its effectiveness in reducing control technology’s designed location for more than 12 consecutive emissions has been demonstrated in specifications. months, or a shorter period of time for practice; and (xxix) Pollution prevention means any (ii) It is determined by the permitting an engine located at a seasonal source. activity that through process changes, authority to be environmentally A location is any single site at a product reformulation or redesign, or beneficial; building, structure, facility, or substitution of less polluting raw installation. Any engine (or engines) * * * * * materials, eliminates or reduces the that replaces an engine at a location and (xxvi) Undemonstrated technology or release of air pollutants and other that is intended to perform the same or application means any system, process, pollutants to the environment similar function as the engine replaced material, or treatment technology (including fugitive emissions) prior to will be included in calculating the (including pollution prevention), that recycling, treatment, or disposal; it does consecutive time period. An engine has not been demonstrated in practice, not mean recycling (other than certain located at a seasonal source is an engine but would have a substantial likelihood ‘‘in-process recycling’’ practices), energy that remains at a seasonal source during to: recovery, treatment, or disposal. the full annual operating period of the (A) Operate effectively; and (xxx) Plantwide applicability limit (B) Achieve either equal or greater seasonal source. For purposes of this means a plantwide federally enforceable continuous reductions of air pollutant paragraph (a)(1)(xxxii)(B)(3), a seasonal emission limitation established for a emissions than any demonstrated source is a stationary source that stationary source such that subsequent system at lower cost, lower energy remains in a single location on a physical or operational changes input, or with less environmental permanent basis (i.e., at least 2 years) resulting in emissions that remain less impact. and that operates at that single location than the limit are excluded from (xxvii) Complete means, in reference approximately 3 months (or more) each preconstruction review under this to an application for a permit required year. This paragraph (a)(1)(xxxii)(B)(3) section. under this section, that the permitting does not apply to an engine after the (xxxi) Plantwide applicability limit authority has deemed the application to engine is removed from the location. contain the information necessary to major modification means, (xxxiii) Nonroad vehicle means a begin formal review of the application. notwithstanding the requirements of vehicle that is powered by a nonroad Determining an application complete for paragraph (a)(1)(v) of this section, any engine and that is not a motor vehicle the purpose of beginning formal review increase in the emissions rate, in tons or a vehicle used solely for competition. does not preclude the permitting per year, over the plantwide (xxxiv) Stationary internal authority from requiring additional applicability limit. Any emissions combustion engine means: information as may be needed to increase of volatile organic compounds (A) Any internal combustion engine determine whether the applicant shall be considered an increase for that is regulated by a Federal new satisfies all requirements of this section. ozone. source performance standard (xxviii) Demonstrated in practice (xxxii)(A) Nonroad engine means, promulgated under section 111 of the means, for the purposes of this section, except as discussed in paragraph Act; or a control technology that has been— (a)(1)(xxxii)(B) of this section, any (B) Any internal combustion engine (A) Listed in or required by any of the internal combustion engine: that is none of the following: following: (1) In or on a piece of equipment that (1) A nonroad engine; (1) The EPA’s RACT/BACT/LAER is self-propelled or that serves a dual (2) An engine used to propel a motor Clearinghouse; purpose by both propelling itself and vehicle or a vehicle used solely for (2) A major source construction performing another function (such as competition; or permits issued pursuant to either part C garden tractors, off-highway mobile (3) An engine subject to standards or D of title I of the Act; cranes and bulldozers); promulgated under section 202 of the (3) An emissions limitations (2) In or on a piece of equipment that Act. contained in a federally-approved plan, is intended to be propelled while (2) * * * Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38325

(ii) Control technology review. curtailment to have occurred after the during review of a permit application, if (A) In determining the lowest date of its most recent emissions a State becomes delinquent for any of achievable emission rate the applicant inventory, if the inventory explicitly these submissions, or a submission is shall consider all control technology includes as current existing emissions deemed incomplete or disapproved by alternatives that have been the emissions from such previously the Administrator, the plan may allow demonstrated in practice pursuant to shutdown or curtailed sources. the reductions to remain creditable if paragraph (a)(1)(xxviii)(A) of this (4) The reductions described in the permit application was complete (as section prior to the date on which the paragraph (a)(3)(ii)(C)(1) of this section determined in writing by the reviewing permit application is complete, and may be credited in the absence of an authority) before the State became paragraph (a)(1)(xxviii)(B) of this section approved attainment demonstration in delinquent or had a submission deemed 90 days prior to the date on which the an area where an attainment incomplete or disapproved by the permit application is complete. demonstration is or will be required Administrator. (B) The plan may establish a cut-off only if the shutdown or curtailment Alternative 2—paragraph date as the date on or subsequent to the occurred on or after the date the new (a)(3)(iii)(C)(5) only: date that an application is complete source permit application is filed, or if (5) Notwithstanding paragraph pursuant to paragraph (a)(6) of this the applicant can establish that the (a)(3)(ii)(C)(4) of this section, the plan section, after which the permit proposed new source is a replacement may provide that the reductions applicant will not be required to for the shutdown or curtailed source, described in paragraph (a)(3)(ii)(C) of consider control technology alternatives and the cutoff date provisions of this section may be credited in the that are identified through public paragraph (a)(3)(ii)(C) of this section are absence of an EPA-approved attainment comments and that are in addition to observed. demonstration if such reductions those alternatives required under Alternative 1—paragraphs occurred after the last day of the paragraph (a)(2)(ii)(A) of this section, (a)(3)(iii)(C)(5) and (a)(3)(iii)(C)(6): baseline year of the most recent base unless the permitting authority (5) Notwithstanding paragraph year emissions inventory used (or to be determines that the alternatives warrant (a)(3)(ii)(C)(4), the plan may provide used) in the plan. further consideration by the applicant. that for ozone nonattainment areas the * * * * * (3) * * * reductions described in paragraph (5) * * * (ii) * * * (a)(3)(ii)(C)(1) of this section, occurring (C)(1) Emissions reductions achieved (iii) The reviewing authority shall after November 15, 1990, may be provide an opportunity for judicial by shutting down an existing source or credited in the absence of an EPA- curtailing production or operating hours review in State court of the final permit approved attainment demonstration in action by the applicant and any person below baseline levels may be generally an area where an attainment credited if: who participated in the public demonstration is or will be required if participation process provided pursuant (i) Such reductions are surplus, the following conditions are met as they permanent, quantifiable, and federally to this part. The plan may provide that come due: the opportunity for judicial review shall enforceable; (i) The State has submitted a complete be the exclusive means by which (ii) The area has an EPA-approved emissions inventory as required by citizens may obtain judicial review of attainment plan, except that the plan section 182(a)(1) of the Act; may provide that the reductions (ii) The State has submitted complete the terms and conditions of permits, and described in paragraph (a)(3)(ii)(C)(1)(i) revisions to its new source review may require that such actions for of this section may be credited in the permitting program as required under judicial review be filed no later than a absence of an EPA-approved attainment section 182(a)(2)(C) of title I of the Act; reasonable period after the final permit demonstration in areas where the Act (iii) The State has submitted the 15 action. If such a limited time period for does not require an attainment percent volatile organic compounds judicial review is provided in the plan, demonstration, including any area reduction plan required under section then the plan shall provide that designated attainment or unclassifiable 182(b)(1)(A) of the Act for moderate (or petitions for judicial review of final for ozone (areas) in an ozone transport higher) ozone nonattainment areas; permit actions nevertheless can be filed region and any marginal or (iv) The State has submitted the after the deadline if they are based nonclassified ozone nonattainment area; attainment demonstration required for solely on grounds arising after the and moderate ozone nonattainment areas deadline for judicial review and if filed (iii) The shutdown or curtailment under section 182(b)(1)(A) of the Act or within a reasonable period specified in occurred on or after the date specified serious (or higher) ozone nonattainment the plan after the new grounds for for this purpose in the attainment plan, areas under section 182(c)(2) of the Act; review arise. and if such date is on or after the date (v) The State has submitted the 3 (6) Complete application criteria. of the most recent emissions inventory percent reduction plan for serious (or (i) The plan shall provide that the used in the plan’s demonstration of higher) ozone nonattainment areas permitting authority shall— attainment. under section 182(c)(2)(B) of the Act; (A) Determine that a permit (2) Where the plan does not specify a and application is complete or deficient cutoff date for shutdown credits, the (vi) The State has submitted milestone based on the permitting authority’s date of the most recent emissions demonstrations for serious (or higher) consideration of determinations, inventory or attainment demonstration, ozone nonattainment areas under analyses and other information as the case may be, shall apply. section 182(g)(2) of the Act. contained in the application, and However, in no event may credit be (6) If any of the submissions included adequacy thereof, as specified in given for shutdowns which occurred in paragraph (a)(3)(ii)(C)(5) of this paragraphs (a)(6)(ii) through (iii) of this prior to August 7, 1977. section are delinquent, or deemed section; and (3) For purposes of paragraph incomplete or disapproved by the (B) Notify each applicant within a (a)(3)(ii)(C)(1)(iii) of this section, a Administrator, then at such time the specified time period as to either the permitting authority may choose to restrictions of paragraph (a)(3)(ii)(C)(4) completeness of the application or any consider a prior shutdown or of this section are in effect. However, deficiencies in the application or 38326 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules information submitted. In the event of (7) Public participation. welfare, or safety in its operation or such a deficiency, the date of receipt of (i) The plan shall provide that prior to function; the complete application shall be the issuing a permit under this section the (B) The owner or operator agrees to date on which the permitting authority requirements under § 51.161 shall be achieve a level of continuous emissions has received all required information. met; reduction equivalent to that which (ii) The plan shall provide that such (ii) The plan may set forth the would have been required under information shall include: minimum information which must be paragraph (a)(2)(ii) of this section, by a (A) A description of the nature, submitted by public commenters to date specified by the permitting location, design capacity, and typical accompany any recommendations for authority. Such date shall not be later operating schedule of the source or control technology alternatives for than 2 years from the time of startup or modification, including specifications which permit applicants would not 5 years from permit issuance; and drawings showing its design and otherwise be responsible to consider in (C) The source or modification would plant layout; determining the lowest achievable meet the requirements equivalent to (B) A detailed schedule for emission rate as of the date an those in paragraph (a)(2) of this section, construction of the source or application is complete according to based on the emissions rate that the modification; paragraph (a)(2)(ii) of this section. Such stationary source employing the system (C)(1) A detailed description of the information may include the name and of undemonstrated technology or system of continuous emissions location of the source utilizing the application would be required to meet reduction which the applicant has control technology, manufacturer and on the date specified by the permitting submitted in a permit application for type of control device, date of authority; the source or modification to qualify for installation and operation of control (D) The source or modification would either the lowest achievable emission device, and performance requirements not, before the date specified by the rate or an approved undemonstrated and available test data; and permitting authority, cause or contribute technology in accordance with the (iii) The plan shall provide that— to any violation of an applicable waiver provision under paragraph (a)(8) (A) After any cut-off date established national ambient air quality standard; of this section; and in accordance with paragraph and (2) All information used or consulted (a)(2)(ii)(B) of this section, the (E) All other applicable requirements by the applicant in recommending a permitting authority shall notify a including those for public participation system of continuous emissions permit applicant within 10 working have been met. (iii) The plan shall provide that the reduction that qualifies as either the days from the date of receipt of a public permitting authority shall withdraw any lowest achievable emission rate or an comment concerning any control approval to employ a system of approved undemonstrated technology; technology alternatives that the undemonstrated technology or and permitting authority determines to (D) All information necessary to application made under this system if: warrant further consideration by the document that the owner or operator of (A) The proposed system fails by the applicant; and the proposed source or modification has specified date to achieve the required (B) The permitting authority shall demonstrated that all major stationary continuous emissions reduction rate; make available in the public record all sources owned or operated by such (B) The proposed system fails before information that was submitted with person (or by any entity controlling, the specified date so as to contribute to public comment regarding control controlled by, or under common control an unreasonable risk to public health, technology alternatives and provide the with such person) in such State are welfare, or safety; or basis for its decision to either require or subject to emission limitations and are (C) The permitting authority decides not require the permit applicant to in compliance, or on a schedule for at any time that the proposed system is further consider such control compliance, with all applicable unlikely to achieve the required level of technology alternatives. emission limitations and standards control or to protect the public health, (8) Undemonstrated technology or under the Act. welfare, or safety. (iii) The plan shall provide that an application waiver. (iv) The plan shall provide that, if the application shall not be considered (i) The plan may provide that an permitting authority withdraws complete unless the permit application owner or operator of a proposed major approval of a system of undemonstrated has been registered on the applicable stationary source or major modification technology or application, the owner or EPA electronic bulletin board. To may satisfy the requirements of operator shall bring the affected register, at a minimum, the following paragraph (a)(2)(ii) of this section emissions unit(s) into compliance with must be provided: through the use of an undemonstrated the reference lowest achievable (A) Name and type of source; technology or application as set forth in emission rate within 18 months from (B) Nature of proposed project, i.e., this section. The plan may provide that the date of withdrawal. new facility or modification; the owner or operator shall provide to (v) The plan shall provide that the (C) Proposed location of the source in the permitting authority a written permitting authority shall include, as a state/county (including Universal request for approval of an minimum, the following information in Transverse Mercator coordinates) and undemonstrated technology or a waiver issued pursuant to paragraph the distance between the source and application as part of the permit (a)(8) of this section: each Class I area within 250 kilometers; application. (A) The undemonstrated technology (D) Anticipated allowable emissions, (ii) The plan may provide that the or application’s emission control or increase in emission rate, for each permitting authority may approve a performance objective and the affected air pollutant regulated under system of undemonstrated technology or applicable reference lowest achievable the Act; application for a particular source or emission rate; (E) Source contact mailing address modification if: (B) The marginal and gross failure and telephone number; and (A) The proposed control system emission limits as defined by the (F) The agency responsible for issuing would not cause or contribute to an permitting authority on a case-by-case the permit. unreasonable risk to public health, basis; and Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38327

(C) Identification and classification of (i) Applicability. The plan may fully with any applicable control potential failure modes and associated provide that the owner or operator of a technology requirements. contingency measures. proposed or existing major stationary (iv) Plantwide applicability limit (vi) The plan shall provide that if, by source may request the permitting modifications. The plan shall provide the date established in paragraph authority to approve a plantwide that: (a)(8)(ii)(B) of this section, the applicability limit for any one or more (A) Notwithstanding paragraphs undemonstrated technology or pollutants, and that the permitting (a)(1)(v) and (vi) of this section (the application does not achieve the authority may approve a plantwide definitions for major modification and permitted emission limit, but actual applicability limit in accordance with net emissions increase), any physical or emissions are equal to or less than the paragraphs (a)(9)(ii) through (iv) of this operational change consistent with lowest achievable emission rate section. plantwide applicability limit terms and referenced in the permit, the permitting (ii) Procedure. The plan shall conditions and paragraph (a)(1)(vi)(E)(4) authority shall: provided that a plantwide applicability of this section shall not constitute a (A) Issue a final permit with the limit for: major modification for the pollutants emissions limit equal to the (A) A proposed major stationary covered by the plantwide applicability undemonstrated technology or source may be established only through limit. All decreases in emissions shall application’s consistently achieved a process that complies with paragraph have approximately the same qualitative actual emission rate; and (a)(7) of this section; significance for public health and (B) Report the final permit limits to (B) An existing major stationary welfare as that attributed to the increase the EPA’s RACT/BACT/LAER source may be established only through from the particular change; Clearinghouse as a demonstrated control a procedure consistent with § 51.161, (B) Requirements equivalent to those technology. and with at least 30 days allowed for contained in paragraphs (a)(2) through (vii) The plan shall provide that if, by public notice and opportunity for (7) of this section shall apply to any the date established in paragraph comment. plantwide applicability limit major (a)(8)(ii)(B) of this section, the actual (iii) Emission limitations and modification as if it were a major emissions from the undemonstrated conditions. modification, except that in lieu of (A) The plan shall provide that a technology or application constitute paragraph (a)(2)(ii)(B) of this section, a plantwide applicability limit shall be marginal failure the owner or operator plantwide applicability limit major established based on either: may petition the permitting authority to modification shall apply the lowest (1) Plantwide actual emissions (not to achievable emission rate for each permit the undemonstrated technology exceed current allowable emissions), or application to operate at its actual pollutant subject to regulation under the including a reasonable operating margin Act if an emissions increase above the emissions limit. Accordingly, the that is less than the applicable permitting authority may either: plantwide applicability limit would significant emissions rate as defined occur; and (A) Approve the petition and proceed under paragraph (a)(1)(x) of this section; in accordance with paragraph (a)(8)(vi) (C) The lowest achievable emission or rate requirement applies to each of this section; or (2) Source-wide limits on annual (B) Disapprove the petition and emissions unit that contributes to the emissions established in a permit issued emissions increase above the plantwide require the owner or operator to comply within the immediately preceding 5 with paragraph (a)(8)(iv) of this section. applicability limit. years under regulations approved (v) Plantwide applicability limit (viii) The plan shall provide that if, at pursuant to this section, where the reevaluation. (A) The plan shall provide any time prior to or on the date source-wide emissions limits were that the permitting authority shall established in paragraph (a)(8)(ii)(B) of completely offset and relied upon in an reevaluate the plantwide applicability this section, the actual emissions from approved state attainment limit emission limitations pursuant to— the undemonstrated technology or demonstration plan. (1) Permit renewal and public application constitute gross failure— (B) The plan shall provide that any notification procedures under parts 70 (A) The permitting authority shall plantwide applicability limit emissions or 71 of this chapter; or withdraw approval pursuant to limitations shall be achievable through (2) Another proceeding with public paragraph (a)(8)(iv) of this section; and application of production processes or notice and opportunity for public (B) The owner or operator shall available methods, systems, and comment. mitigate all emissions increases above techniques including, but not limited to, (B) As part of the reevaluation, the the emissions limit equivalent to the emissions control equipment, fuel permitting authority may reduce applicable reference lowest achievable cleaning or treatment, fuel combustion permitted emission limitations or emissions rate by reducing actual techniques, substitution of less otherwise adjust, but not increase, emissions. polluting materials, or limits on permitted emission limitations to (ix) The plan shall provide that the production that represent normal source reflect— permitting authority submit to the operations. (1) Air quality concerns arising after Administrator a copy of the approval of (C) The plan shall provide that the approval of the plantwide the system of undemonstrated specific terms and conditions which applicability limit; technology or application within 30 assure the practical enforceability of (2) Changes at the source; or days of its approval. plantwide applicability limit emissions (3) Other appropriate considerations. (x) The plan shall provide that the limitations shall be contained in a (C) The plan shall provide that the permitting authority shall limit the federally enforceable permit applicable permitting authority shall adjust the number of waivers granted to the to the source. source’s plantwide applicability limit number necessary to ascertain whether (D) The plan shall provide that the emission limitations to reflect new or not such system complies with emissions limitations and conditions applicable requirements as they become sections 111(j)(1)(A)(ii) and (iii) of the established for a plantwide applicability effective. Act. limit shall not relieve any owner or (10) For a major modification of (9) Plantwide applicability limit. operator of the responsibility to comply volatile organic compounds at a 38328 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules stationary source locating in a serious or Administrator determines (when the owner or operator of the source elects to severe ozone nonattainment area the Administrator approves a plan or plan offset the proposed emissions increase plan shall include enforceable revision) that additional reductions of of such VOC by a greater reduction in procedures to provide that: nitrogen oxides would not contribute to actual emissions of VOC from other (i) The lowest achievable emission attainment of the national ambient air discrete operations, units, or pollutant rate requirement pursuant to paragraph quality standard for ozone in the area; emitting activities within the same (a)(2)(i) of this section does not apply to or stationary source at a ratio of at least any discrete emissions unit(s) (or other (iii) Areas within an ozone transport 1.3:1. Also, in extreme ozone operations or pollutant emitting region if the Administrator determines nonattainment areas emissions increases activities) that is part of the proposed (when the Administrator approves a of VOC resulting from modifications major modification of volatile organic plan or plan revision) that additional consisting of equipment that is needed compounds at an existing stationary reductions of nitrogen oxides would not to comply with the applicable source which emits, or has the potential produce net air quality benefits in such implementation plan, permit, or to emit, 100 tons per year or more of region. provision under the Act need not be volatile organic compounds if such (13) The plan shall require that the offset under this section. source proposes creditable emissions requirements of this section applicable (16) The plan shall require that the reductions from the source to internally to major stationary sources and major permitting authority shall, for each new offset the emissions increase from the modifications of PM–10 shall also apply major source and major modification selected discrete emissions unit(s) (or to major stationary sources and major subject to the provisions of this section, other operations or pollutant emitting modifications of PM–10 precursors, submit to the RACT/BACT/LAER activities) at a ratio of at least 1.3:1; except where the Administrator Clearinghouse within 60 days of (ii) Notwithstanding the requirement determines that such sources do not issuance of the permit, all relevant for the lowest achievable emission rate contribute significantly to PM–10 levels information on the emissions pursuant to paragraph (a)(2)(i) of this which exceed the PM–10 ambient prevention or control technology for the section, the best available control standards in the area. new major source or major modification. technology requirement of section (14)(i) The plan shall require that in 165(a)(4) of the Act shall apply to a 3. Paragraphs in § 51.166 are meeting the emissions offset redesignated as follows: proposed major modification of volatile requirements of paragraph (a)(2) of this organic compounds at an existing major section for ozone nonattainment areas, New para- stationary source which emits, or has the ratio of total actual emission Old paragraph graph the potential to emit, less than 100 tons reductions of VOC to the emissions of volatile organic compounds per year; increase of VOC shall be as follows: (b)(1)(i)(a) through (c) ...... (b)(1)(i)(A) and (A) In any marginal nonattainment through (iii) Any emissions reduction of area for ozone—at least 1.1:1; (C). volatile organic compounds used as an (B) In any moderate nonattainment (b)(1)(iii)(a) through (aa) ...... (b)(1)(iii)(A) internal offset pursuant to this section area for ozone—at least 1.15:1; through shall meet the applicable requirements (C) In any serious nonattainment area (AA). (b)(2)(iii)(a) through (k) ...... (b)(2)(iii)(A) for crediting emissions reductions under for ozone—at least 1.2:1; through paragraph (a)(3)(ii) of this section. (D) In any severe nonattainment area (K). (11) For modifications at major for ozone—at least 1.3:1 (except that the (b)(3)(i)(a) and (b) ...... (b)(3)(i)(A) stationary sources of nitrogen oxides in ratio may be at least 1.2:1 if the and (B). serious or severe ozone nonattainment approved plan also requires all existing (b)(3)(vi)(a) through (c) ...... (b)(3)(vi)(A) areas the plan shall require that the major sources in such nonattainment through provisions of this section applicable to area to use BACT for the control of (C). modifications of volatile organic VOC); and (b)(13)(i)(a) and (b) ...... (b)(13)(i)(A) compounds in serious and severe ozone (E) In any extreme nonattainment area and (B). nonattainment areas shall also apply to for ozone—at least 1.5:1 (except that the (b)(13)(ii)(a) and (b) ...... (b)(13)(ii)(A) and (B). nitrogen oxides, except for serious or ratio may be at least 1.2:1 if the (b)(14)(i)(a) and (b) ...... (b)(14)(i)(A) severe ozone nonattainment areas where approved plan also requires all existing and (B). the Administrator has determined that major sources in such nonattainment (b)(14)(ii)(a) and (b) ...... (b)(14)(ii)(A) the requirements of section 182(f) of the area to use BACT for the control of and (B). Act do not apply. VOC); and (b)(14)(iii)(a) and (b) ...... (b)(14)(iii)(A) (12) The plan shall provide that the (ii) Notwithstanding the requirements and (B). requirements of this section applicable of paragraph (a)(14)(i) of this section for (b)(15)(ii)(a) and (b) ...... (b)(15)(ii)(A) to major stationary sources and major meeting the requirements of paragraph and (B). modifications of volatile organic (a)(2) of this section, the ratio of total (f)(4)(iii)(a) and (b) ...... (f)(4)(iii)(A) actual emissions reductions of VOC to and (B). compounds shall apply to nitrogen (i)(4)(ii)(a) through (aa) ...... (i)(4)(ii)(A) oxides emissions from major stationary the emissions increase of VOC shall be through sources and major modifications of at least 1.15:1 for all areas within an (AA). nitrogen oxides in an ozone transport ozone transport region except for (i)(4)(iii)(a) through (d) ...... (i)(4)(iii)(A) region or in any ozone nonattainment serious, severe, and extreme ozone through area classified as marginal, moderate, nonattainment areas. (D). serious, severe, or extreme, except in: (15) The plan shall require that a (i)(8)(i)(a) through (m) ...... (i)(8)(i)(A) (i) Areas where the Administrator major modification of a major stationary through determines that the net air quality source of VOC locating in an extreme (M). benefits are greater in the absence of nonattainment area for ozone shall be (m)(1)(i)(a) and (b) ...... (m)(1)(i)(A) considered to comply with the and (B). nitrogen oxides reductions; (s)(2)(iv)(a) and (b) ...... (s)(2)(iv)(A) (ii) Nonattainment areas not within an emissions offset requirements under and (B). ozone transport region if the paragraph (a)(2) of this section if the Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38329

4. Section 51.166 is amended as after the words ‘‘receipt of the’’ in the rr. Adding new paragraph (q)(6); follows: last sentence, and removing the word ss. Revising paragraph (r)(1); a. Amending newly redesignated ‘‘reviewing’’ and adding in its place tt. Revising the heading of paragraph paragraph (b)(2)(iii)(F) by adding the ‘‘permitting’’; (s); words ‘‘Standing alone,’’ at the x. Amending paragraph (n)(2) uu. Revising paragraphs (s)(1) and beginning of the sentence and revising introductory text by removing the word (s)(2) introductory text; the word ‘‘An’’ to read ‘‘an’’; ‘‘may’’ and adding in its place ‘‘shall’’ vv. Amending paragraph (s)(2)(ii) by b. Revising newly redesignated and removing the words ‘‘shall include’’ removing the cite ‘‘(j)(2)’’ and adding in paragraph (b)(2)(iii)(H); and adding in its place ‘‘includes’’; its place ‘‘(j)’’, removing the word c. Adding new paragraphs y. Revising paragraph (n)(2)(iii) and ‘‘reviewing’’ and adding in its place (b)(2)(iii)(L) through (N); adding new paragraph (n)(2)(iv); ‘‘permitting’’, removing the words ‘‘4 d. Revising newly redesignated z. Revising paragraph (n)(3); years’’ and adding in its place ‘‘2 years’’, paragraph (b)(3)(vi)(C); aa. Adding new paragraphs (n)(4) and and removing the words ‘‘7 years’’ and e. Revising paragraph (b)(5); (n)(5); adding in its place ‘‘5 years’’; f. Revising paragraphs (b)(19), bb. Amending paragraph (o)(1) by ww. Amending the introductory text (b)(21)(ii), and (b)(22); adding ‘‘, except that for Federal Class of both paragraphs (s)(2)(iii) and (s)(3) g. Adding a new paragraph (b)(21)(vi); I and II areas such analysis may be by removing the word ‘‘reviewing’’ and h. Revising paragraph (b)(23); excluded only by approval of the adding in its place ‘‘permitting’’ and i. Amending paragraph (b)(24) by Federal Land Manager’’ to the end of the removing the words ‘‘innovative control adding the words ‘‘(or the Secretary’s second sentence; technology’’ to read ‘‘undemonstrated designee)’’ after the word ‘‘lands’’ at the cc. Revising the heading of paragraph technology or application’’; end of the sentence; (p); ww. Revising paragraph (s)(4); j. Revising paragraph (b)(27); dd. Redesignating paragraph (p)(1) as xx. Adding new paragraphs (s)(5) k. Revising paragraphs (b)(31) new paragraph (q)(1); through (s)(10); introductory text and (b)(31)(i); ee. Adding new paragraph (p)(1); yy. Adding new paragraphs (t) and l. Removing paragraph (b)(31)(ii) and ff. Revising paragraphs (p)(2) and (u). redesignating paragraphs (b)(31)(iii) and (p)(3); gg. Redesignating paragraphs (p)(4) § 51.166 Prevention of significant (iv) as new paragraphs (b)(31)(ii) and through (p)(7) as new paragraphs (p)(8) deterioration of air quality. (iii); through (p)(11); * * * * * m. Adding new paragraphs (b)(38) hh. Adding new paragraphs (p)(4) (b) * * * through (b)(48); through (p)(7); (2) * * * n. Amending paragraph (g)(1) by ii. Amending newly redesignated (iii) * * * removing the words ‘‘State paragraph (p)(9)(i) by revising the (H) The addition, replacement, or use implementation’’ from the last sentence; citation ‘‘(q)(4)’’ to read ‘‘(p)(7)’’; of a pollution control project at an o. Amending paragraph (i)(8)(i) by jj. Amending newly redesignated existing emissions unit unless the removing newly redesignated paragraphs (p)(9)(iii) and (p)(10)(iii) by pollution control project will result in a paragraphs (i)(8)(i)(G), (H) and (J) and removing the citation ‘‘(q)(7)’’ and significant net increase in representative redesignating paragraph (i)(8)(i)(I) as adding in its place ‘‘(p)(11)’’; actual annual emissions of any pollutant paragraph (i)(8)(i)(G) and (i)(8)(i)(K) kk. Amending newly redesignated regulated under this section and the through (i)(8)(i)(M) as (i)(8)(i)(H) paragraph (p)(11) by removing the permitting authority determines that through (i)(8)(i)(J); citation ‘‘(q)(5) or (6)’’ and adding in its this increase will cause or contribute to p. Adding new paragraph (i)(13); place ‘‘(p)(9) or (p)(10)’’; a violation of any national ambient air q. Adding new paragraphs (j)(5) and ll. Amending newly redesignated quality standard or any maximum (6); paragraph (q)(1) by removing the words allowable increase over the baseline r. Amending the introductory text of ‘‘Notice to EPA,’’ and in the first concentration, or will have an adverse paragraph (k) by adding the word sentence, removing the word impact on air quality related values at ‘‘significantly’’ after the words ‘‘would ‘‘reviewing’’ and adding in its place any Class I area. For the purpose of this not cause or’’; ‘‘permitting’’; paragraph, in lieu of the source’s s. Amending paragraph (m)(2) by mm. Redesignating paragraph (q)(2) representative actual annual emissions, removing the word ‘‘ambient’’, introductory text through (q)(2)(v) as the emissions levels used for that source removing the word ‘‘reviewing’’ and new paragraphs (q)(4) introductory text in the most recent air quality impact adding in its place ‘‘permitting’’, and through (q)(4)(v); analysis in the area conducted for the adding the words ‘‘, or on air quality nn. Redesignating paragraphs purpose of title I of the Act, if any, may related values of a Federal Class I area. (q)(2)(vi) through (viii) as new be used. Decisions about post-construction paragraphs (q)(5)(i) through (iii); * * * * * monitoring for air quality related values oo. Adding new paragraphs (q)(2) and (L) Any activity undertaken at an in Federal Class I areas shall be made in (q)(3); existing emissions unit for which a consultation with the Federal Land pp. Amending newly redesignated federally enforceable emission limit has Manager.’’ at the end of the paragraph; paragraph (q)(4)(ii) by removing the been established, provided that: t. Revising the heading of paragraph words ‘‘if any’’ and adding in its place (1) The activity or project will not (n); ‘‘such as any information concerning an increase the maximum emissions rate, u. Revising paragraph (n)(1); adverse impact on air quality related in pounds or kilograms per hour, above v. Redesignating paragraph (q)(1) as values required under paragraph the maximum emissions rate achievable new paragraph (n)(1)(ii); (p)(6)(iii) of this section’’; by the emission unit at any time during w. Amending newly redesignated qq. Amending newly redesignated the 180 consecutive days which precede paragraph (n)(1)(ii) by removing the paragraph (q)(4)(iii) by adding the words the date of the activity or project and the words ‘‘The reviewing authority shall’’, ‘‘any potential adverse impact on air emissions increase is determined by: and capitalizing ‘‘n’’ in the word quality related values,’’ after the words (i) Material balances, continuous ‘‘notify’’, adding the word ‘‘complete’’ ‘‘source or modification,’’; emissions monitoring data, or manual 38330 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules emissions tests using the EPA-approved satisfied paragraph (b)(2)(iii)(L)(2) of from a nonroad engine or nonroad procedures, where available, and this section. vehicle. conducted under such conditions as the (3) The activity would not require a * * * * * permitting authority will specify to the revision to, or cause a violation of, any (19) Undemonstrated technology or owner or operator based on federally enforceable limit or condition application means any system, process, representative performance of the in a permit issued under either § 52.21 material, or treatment technology emissions units affected by the activity of this chapter or regulations approved (including pollution prevention) that or project, including at least three valid pursuant to §§ 51.160 through 51.166; has not been demonstrated in practice, test runs conducted before, and at least (4) The activity or project does not but would have a substantial likelihood three valid test runs conducted after, the include the replacement or to operate effectively and achieve: activity or project with all operating reconstruction of an emissions unit; and (i) A greater continuous reduction of parameters which may affect emissions (M) Any activity undertaken at an air pollutant emissions than any held constant to the maximum feasible existing major stationary source, demonstrated system; or degree for all such test runs; or provided: (ii) A comparable emissions reduction (ii) Emission factors as specified in (1) The activity would not require a at lower cost, or with lower energy the latest issue of ‘‘Compilation of Air revision to, or cause a violation of, any input, or with less environmental Pollutant Emission Factors,’’ EPA federally enforceable limit or condition impact. Publication No. AP–42, or other in a permit issued under either § 52.21 * * * * * emission factors determined by the of this chapter or regulations approved (21) * * * permitting authority to be superior to pursuant to §§ 51.160 through 51.166; (ii) Actual emissions shall be AP–42 emission factors, in such cases and calculated using the unit’s actual where use of emission factors (2) The entire major stationary source operating hours, production rates, and demonstrates that the emissions level was permitted, and received the types of materials processed, stored, or resulting from the activity or project currently applicable emission limits for combusted for any 12 consecutive will clearly not increase emissions; all emission units at the source issued months during the 120 consecutive (2) The federally enforceable in accordance with either this section, months that precede the commencement emissions limit at the time of the change or regulations approved pursuant to of construction of a proposed physical is comparable to the emission limit that, § 51.165 or a permit issued under or operational change at the source and considering the air quality designation § 52.21 of this chapter, no more than any current, federally enforceable of the area where the source is located, 120 consecutive months prior to the limitations on emissions required by the would result from a review in proposed activity. Act, including, but not limited to, best accordance with either paragraph (j) of (N) A change to ozone-depleting available control technology, lowest this section or regulations approved substances with lower ozone-depleting achievable emission rate (as defined at pursuant to § 51.165(a)(2), or a review in potential under the provisions of § 51.165(a)(1)(xiii)), reasonably available accordance with § 52.21(j) of this sections 601 and 602 of the Act, control technology, or emissions chapter, for emission units of the same including changes to ozone-depleting standards for hazardous air pollutants class or source category. The permitting substances emitting equipment needed under section 112 of the Act. authority may presume that a source to accommodate the change, as long as * * * * * satisfies paragraph (b)(2)(iii)(L)(2) of this the productive capacity of the (vi) In lieu of paragraphs (b)(21)(iv) section if: equipment is not increased. and (v) of this section, the plan may (i) The activity would occur no later * * * * * provide that, for any emissions unit, than 120 consecutive months from the actual emissions of the unit following a (3) * * * date of issuance of the permit issued physical or operational change shall (vi) * * * under regulations approved pursuant to equal the representative actual annual either this section or § 51.165, or § 52.21 (C) It has approximately the same emissions of the unit, provided the of this chapter, that established the qualitative significance for public health source owner or operator maintains and currently applicable emission limit for and welfare as that attributed to the submits to the reviewing authority, on the emissions unit; increase from the particular change such an annual basis for a period of 5 years (ii) The activity would occur no later that, at a minimum, the decrease is from the date the unit resumes regular than 120 consecutive months from the sufficient to prevent the proposed operation, information demonstrating date of issuance of the permit issued increase from causing or contributing to that the physical or operational change under regulations approved pursuant to a violation of any national ambient air did not result in an emissions increase. §§ 51.160 through 51.164, that quality standard or any applicable A longer period, not to exceed 10 years, established the currently applicable maximum allowable increase over may be required by the reviewing emissions limit for the emissions unit, baseline concentrations or having an authority if it determines such a period provided the permit was issued under adverse impact on air quality related to be more representative of normal regulations that were determined by the values in Class I areas. source post-change operations. Administrator to provide for permits * * * * * (22) Complete means, in reference to that contain emission limitations that (5)(i) Stationary source means any an application for a permit required satisfy paragraph (b)(2)(iii)(L)(2) of this building, structure, facility, installation, under this section, that the permitting section; or or stationary internal combustion engine authority has deemed the application to (iii) The activity would occur no later which emits or which may emit any air contain the information necessary (in than 60 consecutive months from the pollutant subject to regulation under the accordance with the criteria contained date on which the permitting authority Act. in paragraph (n) of this section) to begin made a determination, with public (ii) A stationary source does not formal review of the application. notice and opportunity for public include emissions resulting directly Determining an application complete for comment consistent with § 51.161 of from an internal combustion engine the purpose of beginning formal review this part, that the emissions limit used for transportation purposes, or does not preclude the permitting Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38331 authority from requiring additional Municipal waste combustor metals (iv) In reference to the predicted information as may be needed to (measured as particulate matter): 14 ambient impact that the emissions from determine whether the applicant megagrams per year (15 tons per year) a proposed major source or major Municipal waste combustor acid gases satisfies all requirements of this section. (measured as sulfur dioxide and hydrogen modification will have for purposes of (23) Significant means: chloride): 36 megagrams per year (40 tons determining compliance with the (i) In reference to a net emissions per year) national ambient air quality standards, increase or the potential of a source to Ozone-depleting substances (ODS): 100 tons concentrations which exceed any of the emit any of the following pollutants, a per year. following: rate of emissions that would equal or (ii) In reference to a net emissions exceed any of the following rates: Averaging Significant increase or the potential of a source to Pollutant time Impact POLLUTANT AND EMISSIONS RATE emit a pollutant subject to regulation 3 Carbon monoxide: 100 tons per year under the Act that paragraph (b)(23)(i) SO2 ...... Annual ..... 1.0 µg/m Nitrogen oxides: 40 tons per year of this section does not list, any 24-Hour ... 5.0 µg/m3 Sulfur dioxide: 40 tons per year emissions rate. However, for purposes of 3-Hour ..... 25.0 µg/m3 Ozone: 40 tons per year of volatile organic the applicability of this section, the PM±10 ...... Annual ..... 1.0 µg/m/3 compounds hazardous air pollutants listed under 24-hour .... 5.0 µg/m3 Particulate matter: 25 tons per year of µ 3 section 112(b)(1) of the Act, including NO2 ...... Annual ..... 1.0 g/m particulate matter emissions; 15 tons per 3 the hazardous air pollutants that may be CO ...... 8-hour ...... 0.5 mg/m year of PM–10 emissions 1±Hour ..... 2.0 mg/m3 Lead: 0.6 tons per year added to the list, are not considered Fluorides: 3 tons per year subject to regulation under the Act. Sulfuric acid mist: 7 tons per year (iii) Notwithstanding paragraph (v) In reference to the predicted Hydrogen sulfide: 10 tons per year (b)(23)(i) of this section, any emissions ambient impact that emissions from a Total reduced sulfur (including hydrogen rate or any net emissions increase proposed major source or major sulfide): 10 tons per year associated with a major stationary modification will have for purposes of Reduced sulfur compounds (including source or major modification, which determining compliance with the hydrogen sulfide): 10 tons per year would construct within 10 kilometers of maximum allowable increases in Municipal waste combustor organics (measured as total tetrathrough octa- a Class 1 area, and have an impact on pollutant concentrations contained in chlorinated dibenzo-p-dioxins and such area equal to or greater than 1 paragraph (c) of this section, dibenzofurans): 3.2 × 10¥6 megagrams per microgram per cubic meter (24-hour concentrations in excess of any of the year (3.5 × 10¥6 tons per year) average). following:

Class III sig- Pollutant Averaging time Class I signifi- Class II signifi- nificant im- cant impact cant impact pact

3 3 3 SO2 ...... Annual ...... 0.1 µg/m ...... 1.0 µg/m ...... 1.0 µg/m 24±Hour ...... 0.2 µg/m3 ...... 5.0 µg/m3 ...... 5.0 µg/m3 3±Hour ...... 1.0 µg/m3 ...... 25.0 µg/m3 ...... 25.0 µg/m3 PM±10 ...... Annual ...... 0.2 µg/m3 ...... 1.0 µg/m3 ...... 1.0 µg/m3 24-Hour ...... 0.3 µg/m3 ...... 5.0 µg/m3 ...... 5.0 µg/m3 3 3 3 NO2 ...... Annual ...... 0.1 µg/m ...... 1.0 µg/m ...... 1.0 µg/m

* * * * or scrubbers for particulate or other that may result in an unacceptable (27) Indian reservation means all land pollutants; increased risk from the release of within the limits of any Indian (C) Flue gas recirculation, low-NOX hazardous pollutants are not Reservation under the jurisdiction of the burners, selective non-catalytic environmentally beneficial; and United States Government, reduction or selective catalytic (G) Installation of a technology, for notwithstanding the issuance of any reduction for NOX; purposes set forth in paragraph (b)(31) patent, and including rights-of-way (D) Regenerative thermal oxidizers, of this section, which is not listed in running through the reservation. catalytic oxidizers, condensers, thermal paragraphs (b)(31)(i)(A) through (E) of * * * * * incinerators, flares or carbon absorbers this section but meets the following: for volatile organic compounds or (1) Its effectiveness in reducing (31) Pollution control project means: hazardous air pollutants; emissions has been demonstrated in (i) Any activity or project undertaken (E) Activities or projects undertaken practice; and at an existing emissions unit which, as to accommodate switching to an (2) It is determined by the permitting its primary purpose, reduces emissions inherently less polluting fuel, including authority, consistent with § 51.161, to be of air pollutants from such unit. Such but not limited to natural gas or coal environmentally beneficial. activities or projects do not include the reburning, or the cofiring of natural gas * * * * * replacement of an existing emissions and other inherently less polluting fuels (38) Federal Class I area means any unit with a newer or different unit, or for the purpose of controlling emissions, Federal lands within the United States the reconstruction of an existing and including any activity that is either designated by Congress as Class I emissions unit, and are limited to any necessary to accommodate switching to pursuant to section 162(a) of the Act of the following: an inherently less polluting fuel; (and which may not be redesignated) or (A) The installation of conventional or (F) Pollution prevention projects redesignated as Class I pursuant to advanced flue gas desulfurization, or which are determined by the permitting either paragraph (g) of this section or sorbent injection for SO2; agency through a process consistent § 52.21(g) of this chapter. (B) Electrostatic precipitators, with § 51.161 to be environmentally (39) Federal official means the Federal baghouses, high efficiency multiclones, beneficial. Pollution prevention projects official charged with direct 38332 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules responsibility for management of any treatment, or disposal; it does not mean is an engine that remains at a seasonal lands within a Federal Class I area. recycling (other than certain ‘‘in-process source during the full annual operating (40) Air quality related value means, recycling’’ practices), energy recovery, period of the seasonal source. For for purposes of this section, visibility or treatment, or disposal. purposes of this paragraph (b)(46)(ii)(C), a scenic, cultural, physical, biological, (44) Plantwide applicability limit a seasonal source is a stationary source ecological, or recreational resource that means a plantwide, federally that remains in a single location on a may be affected by a change in air enforceable emission limitation permanent basis (i.e., at least 2 years) quality, as defined by the Federal Land established for a stationary source such and that operates at that single location Manager for Federal lands, or by the that any subsequent physical or approximately 3 months (or more) each applicable State or Indian Governing operational changes resulting in year. This paragraph (b)(46)(ii)(C) does Body for nonfederal lands. emissions that remain less than the not apply to an engine after the engine (41) Adverse impact on air quality limit, are excluded from preconstruction is removed from the location. related values means, for purposes of review under this section. (47) Nonroad Vehicle means a vehicle this section, a deleterious effect on any (45) Plantwide applicability limit that is powered by a nonroad engine air quality related value identified by a major modification means, and that is not a motor vehicle or a Federal Land Manager, resulting from notwithstanding the requirements of vehicle used solely for competition. emissions from a proposed major source paragraph (b)(2) of this section, any (48) Stationary internal combustion or major modification, that interferes increase in the emissions rate (in tons engine means: with the management, protection, per year) over the plantwide (i) Any internal combustion engine preservation, or enjoyment of such air applicability limit. Any emissions that is regulated by a Federal new quality related values of a Federal Class increase of volatile organic compounds source performance standard I area. This determination shall be made shall be considered an increase for . promulgated under section 111 of the on a case-by-case basis taking into (46)(i) Nonroad engine means, except Act; or account existing air quality conditions. as discussed in paragraph (b)(46)(ii) of (ii) Any internal combustion engine (42) Demonstrated in practice means, this section, any internal combustion that is none of the following: a nonroad for the purposes of this section, a engine: engine, an engine used to propel a control technology that has been— (A) In or on a piece of equipment that motor vehicle or a vehicle used solely (i) Listed in or required by any of the is self-propelled or that serves a dual for competition, or an engine subject to following: purpose by both propelling itself and standards promulgated under section (A) The EPA’s RACT/BACT/LAER performing another function (such as 202 of the Act. Clearinghouse; garden tractors, off-highway mobile * * * * * (B) A major source construction cranes and bulldozers); (i) * * * permit issued pursuant to either part C (B) In or on a piece of equipment that (13) The plan may provide that the or D of title I of the Act; is intended to be propelled while (C) An emissions limitation contained performing its function (such as provisions of this section do not apply in a federally-approved plan, excluding lawnmowers and string trimmers); or to any stationary source with respect to emissions limitations established by (C) That, by itself or in or on a piece any or all of the hazardous air pollutants permits issued pursuant to programs for of equipment, is portable or listed in section 112 the Act, as well as non-major sources; transportable, meaning designed to be any or all pollutants that may be added (D) A permit or standard under and capable of being carried or moved to the list under the provisions of section 111 or 112 of the Act; from one location to another. Indicia of section 112(b)(2) of the Act. However, (E) The EPA’s Alternative Control transportability include, but are not the applicable provisions of this section Techniques documents and Control limited to, wheels, skids, carrying shall apply to any pollutant listed under Techniques Guidelines; or handles, dolly, trailer, or platform. sections 112(b)(1) or (b)(2) of the Act (ii) Notwithstanding paragraph (ii) An internal combustion engine is that is deleted from such list under the (b)(42)(i) of this section, installed and not a nonroad engine if: provisions of section 112(b)(3) of the operating on an emissions unit (or units) (A) The engine is used to propel a Act. Any hazardous air pollutants listed which: motor vehicle or a vehicle used solely in section 112 of the Act which are (A) Has operated at a minimum of 50 for competition, or is subject to regulated as constituents or precursors percent of design capacity for 6 months; standards promulgated under section of a more general pollutant listed under and 202 of the Act; section 108 of the Act are still subject (B) The pollution control efficiency (B) The engine is regulated by a to the provisions of this section, performance has been verified with Federal new source performance notwithstanding section 112(b)(6) of the either: standard promulgated under section 111 Act. (1) A performance test; or of the Act; or (j) * * * (2) Performance data collected at the (C) The engine otherwise included in (5)(i) In determining best available maximum design capacity of the paragraph (b)(46)(i) of this section control technology: emissions unit (or units) being remains or will remain at a location for (A) The applicant shall identify and controlled, or 90 percent or more of the more than 12 consecutive months, or a evaluate all available and technically control technology’s designed shorter period of time for an engine feasible control technology alternatives specifications. located at a seasonal source. A location that have been demonstrated in practice (43) Pollution prevention means any is any single site at a building, structure, pursuant to either paragraph (b)(42)(i) of activity that through process changes, facility, or installation. Any engine (or this section prior to the date on which product reformulation or redesign, or engines) that replaces an engine at a the permit application is complete, or substitution of less-polluting raw location and that is intended to perform paragraph (b)(42)(ii) of this section 90 materials, eliminates or reduces the the same or similar function as the days prior to the date on which the release of air pollutants (including engine replaced will be included in permit application is complete; and fugitive emissions) and other pollutants calculating the consecutive time period. (B) The applicant shall demonstrate to to the environment prior to recycling, An engine located at a seasonal source the satisfaction of the permitting Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38333 authority that the rejection of all (B) All information used or consulted adjacent State, or the governing body of alternatives more stringent than the one by the applicant in recommending a an adjacent Indian Tribe containing a recommended as best available control system of continuous emissions Federal Class I area, files, prior to the technology is justified by the energy, reduction as either the best available date a completeness determination is environmental, and economic impacts control technology or an approvable made pursuant to paragraph (n)(1) of and other costs of those alternatives. If undemonstrated technology. this section, a written notice alleging the most stringent technology is chosen, (iv) Information and data used to that emissions of a particular pollutant the permitting authority may wave the perform all required analyses or from a proposed major source or major requirement to analyze less effective determinations under paragraphs (o), modification may cause or contribute to control technologies. Documentation (p), (r), (s) and (u) of this section, as a change in the air quality in such area supporting the demonstration shall be applicable. and identifying the potential adverse included in the public record pursuant (3) The plan shall provide that upon impact of such change on affected air to paragraph (q)(6)(iii) of this section. request of the permitting authority, the quality related values identified in the (ii) The control technology owner or operator shall provide any area by the Federal Land Manager, a alternatives considered in paragraph information and data used to perform all permit shall not be issued unless the (j)(5)(i) of this section shall be based required analyses or determinations owner or operator of such source: upon control technologies and methods under paragraphs (k), (l) and (m) of this (1) Demonstrates to the satisfaction of for the same and similar source section. the permitting authority that emissions categories, i.e., those categories (4) The plan shall provide that an will not cause or contribute to ambient including sources that have similar application shall not be considered pollutant concentrations in the Federal emissions-stream characteristics. complete unless the permit application Class I area which violate the maximum (iii) The plan may establish a cut-off has been registered on the applicable allowable increases over baseline date on or subsequent to the date that EPA electronic bulletin board. To concentrations; and an application is complete pursuant to register, at a minimum, the following (2) Provides an analysis of the paragraph (n) of this section, after which must be provided: potential impacts on air quality related the permit applicant will not be (i) Name and type of source; values at the Federal Class I area. required to consider control technology (ii) Nature of proposed project, i.e., (B) Notwithstanding the restriction on alternatives that are identified through new facility or modification; issuing a permit under paragraph public comments and that are in (iii) Proposed location of the source in (p)(2)(i)(A)(1) of this section, a permit addition to those alternatives required state/county (including Universal otherwise prohibited under paragraph under paragraph (j)(5)(i)(A) of this Transverse Mercator coordinates) and (p)(2)(i)(A)(1) of this section may be section, unless the permitting authority the distance between the source and issued in accordance with the variance determines that, based on information each Class I area within 250 kilometers; provisions in paragraphs (p)(8) through submitted pursuant to paragraph (q)(2) (iv) Anticipated allowable emissions, (p)(11) of this section. of this section, the alternatives warrant or increase in emissions rate, for each (ii) Available information on air further consideration by the applicant. affected air pollutant regulated under quality related values and analytical (6) For determinations of best the Act; methods. The Federal Land Manager or available control technology under the (v) Source contact mailing address Federal Official shall, upon request, requirements of this section, the and telephone number; and provide to the owner or operator of a reviewing authority shall submit the (vi) The agency responsible for proposed major source or major control technology information to the issuing the permit. modification that may have an adverse EPA’s RACT/BACT/LAER (5) The plan shall provide that prior impact on air quality related values in Clearinghouse within 60 days after to making a completeness a Federal Class I area all available permit approval. determination, the permitting authority information about such values and * * * * * shall provide for any Federal Land methods to analyze potential impacts. (iii) Consultation with Federal Land (n) Complete application criteria. Manager review and coordination Manager. The plan shall provide for (1) The plan shall provide that the required under paragraph (p)(5) of this consultation and coordination with the permitting authority shall— section. (i) Determine that a permit Federal Land Manager, including the * * * * * procedures contained in paragraphs application is complete or deficient (p) Sources potentially impacting based on the permitting authority’s (p)(3) through (p)(6) of this section. Federal Class I areas. (3) Pre-application coordination. The consideration of determinations, (1) Protection of air quality related plan shall provide that, for a proposed analyses and other information values. The Federal Land Manager and major source or major modification contained in the application, and the Federal Official have an affirmative within 100 kilometers of a Federal Class adequacy thereof, as specified in responsibility to protect the air quality I area the permitting authority shall: paragraphs (n)(2) through (n)(5) of this related values of Federal Class I areas (i) Notify the affected Federal Land section; and and to consider, in consultation with Manager shall be notified within 30 * * * * * the Administrator, whether a proposed days from receipt by the permitting (2) * * * source or modification will have an authority of advance notification of a (iii)(A) A detailed description of the adverse impact on such values. permit application; and system of continuous emissions (2) General requirements. (ii) Give the affected Federal Land reduction which the applicant has (i) Notification of potential impacts Manager reasonable notice and an submitted in a permit application for a on a Federal Class I area and opportunity to participate in pre- source or modification, to qualify either requirement for impact assessment. The application meetings with the applicant. as best available control technology, or plan shall provide that: (4) Permit application coordination. for an undemonstrated technology (A) Where the Federal Official, The plan shall provide that: waiver in accordance with paragraph (s) Federal Land Manager, the (i) The Federal Land Manager of any of this section; and Administrator, the Governor of an Federal Class I area within 100 38334 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules kilometers of a proposed major source the Federal Land Manager, reference the is complete according to paragraph or major modification shall be provided Federal Land Manager’s demonstration (j)(5)(iii) of this section. Such with a copy of the permit application and its rejection of the demonstration in information may include the name and and other relevant information; and the public notice announcing the location of the source utilizing the (ii) The Federal Land Manager shall preliminary permit determination and control technology, manufacturer and be provided with a copy of a permit propose to approve the permit with an type of control device, date of application requested within 7 days explanation in writing (for inclusion in installation and operation of control from the date information about such the public record along with the Federal device, and performance requirements application is registered on the Land Manager’s demonstration) of the and available test data. applicable EPA electronic bulletin board reasons for rejecting the Federal Land (3) The plan shall provide that— (in accordance with paragraph (n)(4) of Manager’s demonstration. The (i) After any cut-off date established this section). permitting authority’s written pursuant to paragraph (j)(5)(iii) of this (5) Completeness determination explanation shall address, at a section, the permitting authority shall coordination. The plan shall provide minimum, the following: notify a permit applicant within 10 that prior to making the completeness (A) The basis for any disagreement working days from the date of receipt of determination under paragraph (n)(1) of with the data and analyses contained in a public comment concerning any this section, the permitting authority the Federal Land Manager’s control technology alternatives that the shall: demonstration of adverse impact on air permitting authority determines to (i) Ensure that the applicant has quality related values; warrant further consideration by the provided any analysis required pursuant (B) Any conclusions the permitting applicant; and to paragraph (p)(2)(i) of this section; authority reaches, about whether the (ii) The permitting authority shall (ii) Give the Federal Land Manager 30 projected impacts of the proposed days from receipt of an application to make available in the public record all source’s emissions will have an adverse information that was submitted with review the application, where the impact on air quality related values, that Federal Land Manager has received public comment regarding control are inconsistent with the conclusions technology alternatives and provide the such application pursuant to paragraph reached in the demonstration submitted (p)(4) of this section; basis for its decision to either require or by the Federal Land Manager; and not require the permit applicant to (iii) Consider any comments provided (C) Any measures undertaken to by the Federal Land Manager within the further consider such control mitigate the potential adverse impacts of technology alternatives. time period under paragraph (p)(5)(ii) of proposed emissions increases, including this section; and the estimated effect of any mitigation; * * * * * (iv) Consult with the Federal Land (iv) In the final permit determination, (6) The reviewing authority shall Manager about any inconsistency the permitting authority shall address provide an opportunity for judicial between the determination by the any comments made by the Federal review in State court of the final permit permitting authority and the Federal Land Manager concerning the action by the applicant and any person Land Manager’s recommendations. permitting authority’s preliminary who participated in the public (6) Preliminary and final permit participation process provided pursuant determination—No Class I increment determination. (7) Mitigation of adverse impacts. The to this section. The plan may provide violation. The plan shall provide that, that the opportunity for judicial review where the permitting authority has plan may provide that the permitting authority may issue a permit for a shall be the exclusive means for determined that the emissions from the obtaining judicial review of the terms proposed major source or major proposed major source or major modification that would otherwise be and conditions of permits, and may modification will not cause or require that such petitions for judicial contribute to ambient pollutant denied a permit under paragraph (p)(6) of this section, if the permitting review be filed no later than a concentrations in the Federal Class I reasonable period after the final permit area which violate the maximum authority determines, in consultation with the Federal Land Manager, that the action. If such a limited time period for allowable increases over baseline judicial review is provided in the plan, concentrations— source has mitigated its adverse impact on air quality related values. The owner then the plan shall provide that (i) The permitting authority shall not petitions for judicial review of final issue a preliminary permit or operator of a proposed major source or major modification may mitigate an permit actions can be filed after the determination until the Federal Land deadline only if they are based solely on Manager has been given at least 60 days adverse impact by obtaining enforceable and permanent emissions reductions of grounds arising after the deadline for (from the date of issuance of the judicial review and only if filed within completeness determination required sufficient amount and in such location that the reductions will offset the a reasonable period specified in the plan under paragraph (n)(1) of this section to after the new grounds for review arise. submit a demonstration that a proposed change in air quality in the Federal (r) Source obligation. major source or major modification will Class I area that would have resulted have an adverse impact on air quality from the proposed source. (1) The plan shall include enforceable related values; * * * * * procedures to— (ii) If the permitting authority agrees (q) * * * (i) Provide that approval to construct with the Federal Land Manager’s (2) The plan may set forth the shall not relieve any owner or operator demonstration under paragraph (p)(6)(i) minimum information which must be of the responsibility to comply fully of this section, the permitting authority submitted by public commenters to with applicable provisions of the plan shall propose to deny the permit; accompany any recommendations for and any other requirements under local, (iii) If the permitting authority is not control technology alternatives for State or Federal law; and satisfied with the Federal Land which permit applicants would not (ii) Require any owner or operator to Manager’s demonstration under otherwise be responsible to consider in construct and operate a source or paragraph (p)(6)(i) of this section, the determining best available control modification in accordance with the permitting authority shall consult with technology as of the date an application application submitted pursuant to this Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38335 section or with the terms of any (7) The plan shall provide that if, by of the lands involved. If the parties approval to construct. the date established in paragraph involved do not reach agreement, the * * * * * (s)(2)(ii) of this section, the actual Administrator shall resolve the dispute (s) Undemonstrated technology or emissions from the undemonstrated and the Administrator’s determination, application waiver. technology or application constitute or the results of agreements reached (1) The plan may provide that an marginal failure, the owner or operator through other means, shall become part owner or operator of a proposed major may petition the permitting authority to of the applicable plan and shall be stationary source or major modification permit the undemonstrated technology enforceable as part of such plan. In may satisfy the requirements of or application at its actual emission resolving such disputes relating to area paragraph (j) of this section through the limit. Accordingly the permitting redesignation, the Administrator shall use of an undemonstrated technology or authority shall either: consider the extent to which the lands application as set forth in this section. (i) Approve the petition and proceed involved are of sufficient size to allow The plan may provide that the owner or in accordance with paragraphs (s)(6)(i) effective air quality management or have operator shall provide to the permitting and (ii) of this section; or air quality related values. authority a written request for approval (ii) Disapprove the petition and (u) Plantwide applicability limit. of an undemonstrated technology or require the owner or operator to comply (1) Applicability. The plan may application as part of the permit with paragraph (s)(4) of this section. provide that an owner or operator of an application. (8) The plan shall provide that if, at existing major stationary source may (2) The plan may provide that the any time prior to, or on, the date request the permitting authority to permitting authority may approve a established in paragraph (s)(2)(ii) of this approve a plantwide applicability limit system of undemonstrated technology or section, the actual emissions from the for any one or more pollutants, and that application for a particular source or undemonstrated technology or the permitting authority may approve a modification if: application constitute gross failure: plantwide applicability limit for an * * * * * (i) The permitting authority shall existing major stationary source, in (4) The plan shall provide that, if the withdraw approval pursuant to accordance with paragraphs (u)(2) permitting authority withdraws paragraph (s)(4) of this section; and through (5) of this section. approval of a system of undemonstrated (ii) The owner or operator shall (2) Procedure. The plan shall provide technology or application, the owner or mitigate all emission increases above that a plantwide applicability limit for operator shall bring the affected the applicable reference best available an existing major stationary source may emissions unit(s) into compliance with control technology emission limit by be established only through a procedure the reference best available control reducing actual emissions. consistent with § 51.161 of this chapter, technology emissions limit within 18 (9) The plan shall provide that the and with at least 30 days allowed for months from the date of withdrawal. permitting authority submit to the public notice and opportunity for (5) The plan shall provide that the Administrator a copy of the approval of comment. permitting authority shall include, as a the system of undemonstrated (3) Emission limitations and minimum, the following information in technology or application within 30 conditions. (i) The plan shall provide a waiver issued pursuant to paragraph days of its approval. that a plantwide applicability limit shall (s) of this section: (10) The plan shall provide that the be established based on either: (i) The undemonstrated technology or number of waivers granted by the (A) Plantwide actual emissions (not to application’s emission control permitting authority shall not exceed exceed current allowable emissions) and performance objective and the such number as necessary to ascertain a reasonable operating margin less than applicable reference best available whether or not such system complies the applicable significant emissions control technology emissions limit; with section 111(j)(1)(A)(ii) and (iii) of rate; or (ii) The marginal and gross failure the Act. (B) Source-wide limits on annual emissions limit(s) as defined by the (t) Disputed permits or redesignations. emissions established in a permit issued permitting authority on a case-by-case If any State affected by the redesignation within the immediately preceding 5 basis; and of an area by an Indian Tribe, or any years under regulations approved (iii) Identification and classification of Indian Tribe affected by the pursuant to § 51.165 of this part, where potential failure modes and associated redesignation of an area by a State the source-wide emissions limits were contingency measures. disagrees with such redesignation of an completely offset and relied upon in an (6) The plan shall provide that if, by area, or if a permit is proposed to be approved state attainment the date established in paragraph issued for any major stationary source or demonstration plan. (s)(2)(ii) of this section, the major modification proposed for (ii) The plan shall provide that any undemonstrated technology or construction in any State which the plantwide applicability limit emission application does not achieve the Governor of an affect State or Governing limitations shall be achievable through permitted emission limit, but actual Body of an affected Indian Tribe application of production processes or emissions are equal to or less than the determines will cause or contribute to a available methods, systems, and best available control technology cumulative change in air quality in techniques including, but not limited to, emission limit referenced in the permit, excess of that allowed in this section emissions control equipment, fuel the permitting authority shall: within the affected State or Indian cleaning or treatment, fuel combustion (i) Issue a final permit with the Reservation, the Governor or Indian techniques, substitution of less emission limit equal to the Governing Body may request the polluting materials, or limits on undemonstrated technology or Administrator to enter into negotiations production that represent normal source application’s consistently achieved with the parties involved to resolve operations. actual emission rate; and such dispute. If requested by any State (iii) The plan shall provide that (ii) Report the final permit limits to or Indian Tribe involved, the specific terms and conditions that the EPA’s RACT/BACT/LAER Administrator shall make a assure the practical enforceability of Clearinghouse as a demonstrated control recommendation to resolve the dispute plantwide applicability limit emission technology. and protect the air quality related values limitations shall be contained in a 38336 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules federally enforceable permit applicable (iii) The plan shall provide that the k. Revising paragraphs (b)(32) to the source. permitting authority shall adjust the introductory text and (b)(32)(i); (iv) The plan shall provide that the source’s plantwide applicability limit l. Removing paragraph (b)(32)(ii) and emissions limitations and conditions emissions limitations to reflect new redesignating paragraphs (b)(32)(iii) and established for a plantwide applicability applicable requirements as they become (iv) as new paragraphs (b)(32)(ii) and limit shall not relieve any owner or effective. (iii); operator of the responsibility to comply m. Adding new paragraphs (b)(39) fully with any applicable control PART 52±APPROVAL AND through (b)(49); technology requirements. PROMULGATION OF n. Amending paragraph (g)(1) by (4) Plantwide applicability limit IMPLEMENTATION PLANS removing the words ‘‘State implementation’’ from the the last modifications. The plan shall provide 1. The authority citation for part 52 is sentence; that: revised to read as follows: (i) Notwithstanding paragraphs (b)(2) o. Revising paragraph (i)(8)(i); and (b)(3) of this section (the definitions Authority: 42 U.S.C. 7401–7671q. p. Adding new paragraph (i)(14); for major modification and net 2. Section 52.21 is amended by q. Adding new paragraphs (j)(5) and emissions increase), any physical or redesignating the paragraphs as follows: (6); operational change consistent with r. Amending paragraph (k) plantwide applicability limit terms and Old paragraph New paragraph introductory text by adding the word conditions of this section shall not ‘‘significantly’’ after the words ‘‘would (b)(1)(i) (a) through (b)(1)(i) (A) through constitute a major modification for the not cause or’’; (c). (C). s. Amending paragraph (m)(2) by pollutants covered by the plantwide (b)(1)(iii) (a) through (b)(1)(iii) (A) through applicability limits. All decreases in removing the word ‘‘ambient’’ and (aa). (AA). adding the words ‘‘, or on air quality emissions shall have approximately the (b)(2)(iii) (a) through (b)(2)(iii) (A) through same qualitative significance for public (k). (K). related values of a Federal Class I area. health and welfare as that attributed to (b)(3)(i) (a) and (b) .... (b)(3)(i) (A) and (B). Deci sions about post-construction the increase from the particular change; (b)(3)(vi) (a) through (b)(3)(vi) (A) through monitoring for air quality related values (ii) Requirements equivalent to those (c). (C). in Federal Class I areas shall be made in contained in paragraphs (j) through (r) (b)(13)(i) (a) and (b) (b)(13)(i) (A) and (B). consultation with the Federal Land (b)(13)(ii) (a) and (b) (b)(13)(ii) (A) and (B). of this section shall apply to any Manager.’’ at the end of the paragraph; (b)(14)(ii) (a) and (b) (b)(14)(ii) (A) and (B). t. Revising the heading and removing plantwide applicability limit major (b)(14)(iii) (a) and (b) (b)(14)(iii) (A) and (B). modification as if it were a major the introductory text of paragraph (n); (b)(15)(ii) (a) and (b) (b)(15)(ii) (A) and (B). u. Redesignating paragraph (n)(2) as modification, except that in lieu of (i)(4)(ii) (a) through (i)(4)(ii) (A) through paragraph (n)(3) and revising it; paragraph (j)(3) of this section, a (c). (C). v. Redesignating paragraph (n)(1) as plantwide applicability limit major (i)(4)(iv) (a) through (i)(4)(iv) (A) through paragraph (n)(2); modification shall apply best available (c). (C). w. Revising newly redesignated control technology for each pollutant (i)(4)(v) (a) through (i)(4)(v) (A) through paragraph (n)(2) introductory text and subject to regulation under the Act if an (c). (C). (i)(4)(vii) (a) through (i)(4)(vii) (A) through newly redesignated paragraph (n)(2)(iii) emissions increase above the plantwide (aa). (AA). and adding new paragraph (n)(2)(iv); applicability limit would occur; and (i)(4)(viii) (a) through (i)(4)(viii) (A) through x. Adding new paragraphs (n)(1), (iii) The best available control (d). (D). (n)(4) and (n)(5); technology requirement applies to each (i)(4)(ix) (a) through (i)(4)(ix) (A) through y. Amending paragraph (o)(1) by emissions unit that contributes to the (c). (C). adding the words ‘‘, except that for emissions increase above the plantwide (m)(1)(i)(a) and (b) .... (m)(1)(i) (A) and (B). (m)(1)(v) (a) through (m)(1)(v) (A) through Federal Class I and II areas such applicability limit. analysis may be excluded only by (5) Plantwide applicability limit (c). (C). (v)(2)(iv) (a) and (b) (v)(2)(iv) (A) and (B). approval of the Federal Land Manager’’ reevaluation. to the end of the second sentence; (i) The plan shall provide that the 3. Section 52.21 is amended as z. Revising the heading of paragraph permitting authority shall reevaluate the follows: (p); plantwide applicability limit emission a. Amending newly redesignated aa. Removing paragraph (p)(1); limitations pursuant to: paragraph (b)(2)(iii)(F) by adding the bb. Redesignating paragraph (p)(2) as (A) Permit renewal and public words ‘‘Standing alone,’’ at the paragraph (p)(1); notification procedures under parts 70 beginning of the sentence and revising cc. Amending newly redesignated or 71 of this chapter; or the word ‘‘An’’ to read ‘‘an’’; paragraph (p)(1) by revising the heading (B) Another proceeding with public b. Revising newly redesignated and removing the words ‘‘charged with notice and opportunity for public paragraph (b)(2)(iii)(H); direct responsibility for management of comment. c. Adding new paragraphs (b)(2)(iii) such lands’’; (ii) As part of the reevaluation (L) through (N); Revising newly dd. Adding new paragraph (p)(2); required under paragraph (u)(5)(i) of redesignated paragraph (b)(3)(vi)(C); ee. Revising paragraphs (p)(3) and this section, the permitting authority e. Revising paragraph (b)(5); (p)(4); may reduce permitted emission f. Revising paragraphs (b)(19), ff. Redesignating paragraphs (p)(5) limitations or otherwise adjust (but not (b)(21)(ii), and (b)(22); through (p)(8) as paragraphs (p)(8) increase) permitted emission limitations g. Adding new paragraph (b)(21)(vi); through (p)(11); to reflect: h. Revising paragraph (b)(23); gg. Adding new paragraphs (p)(5) (A) Air quality concerns arising after i. Amending paragraph (b)(24) by through (p)(7); the approval of the plantwide adding the words ‘‘(or the Secretary’s hh. Amending the newly redesignated applicability limit; designee)’’ after the word ‘‘lands’’ at the paragraph (p)(9) by removing the (B) Changes at the source; or end of the sentence; citation ‘‘(q)(4)’’ and adding in its place (C) Other appropriate considerations. j. Revising paragraph (b)(27); ‘‘(p)(7)’’; Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38337

ii. Amending the newly redesignated in pounds or kilograms per hour, above (iii) The activity would occur no later paragraphs (p)(9) and (p)(10) by the maximum emissions rate achievable than 60 consecutive months from the removing the citation ‘‘(q)(7)’’ and by the emissions unit at any time during date on which the applicable permitting adding in its place ‘‘(p)(11)’’; the 180 consecutive days which precede authority made a determination, with jj. Amending the newly redesignated the date of the activity or project and the public notice and opportunity for public paragraph (p)(11) by removing the emissions increase is determined by: comment consistent with § 51.161 of citation ‘‘(q) (5) or (6)’’ and adding in its (i) Material balances, continuous this chapter, that the emissions limit place ‘‘(p)(9) or (p)(10)’’; emissions monitoring data, or manual satisfied paragraph (b)(2)(iii)(L)(2) of kk. Revising paragraph (q); emissions tests using the EPA-approved this section. ll. Amending paragraph (t) by procedures, where available, and (3) The activity would not require a removing the words ‘‘State conducted under such conditions as the revision to, or cause a violation of, any implementation’’ in the phrase permitting authority will specify to the federally enforceable limit or condition ‘‘applicable State implementation plan’’; owner or operator based on in a permit issued under either this mm. Revising the heading of representative performance of the section or regulations approved paragraph (v); emissions units affected by the activity pursuant to §§ 51.160 through 51.166 of nn. Revising paragraphs (v)(1) and or project, including at least three valid this chapter; (v)(2) introductory text; test runs conducted before, and at least (4) The activity or project does not oo. Amending paragraph (v)(2)(ii) by three valid test runs conducted after, the include the replacement or removing the cite ‘‘(j)(2)’’ and adding in activity or project with all operating reconstruction of an emissions unit; and its place ‘‘(j)’’, removing the words ‘‘4 parameters which may affect emissions (M) Any activity undertaken at an years’’ and adding in its place ‘‘2 years’’, held constant to the maximum feasible existing major stationary source, and removing the words ‘‘7 years’’ and degree for all such test runs; or provided : adding in its place ‘‘5 years’’; (ii) Emission factors as specified in (1) The activity would not require a pp. Amending paragraphs (v)(2)(iii) the latest issue of ‘‘Compilation of Air revision to, or cause a violation of, any and (v)(3) introductory text by removing Pollutant Emission Factors,’’ EPA federally enforceable limit or condition the words ‘‘innovative control Publication No. AP–42, or other in a permit issued under either this technology’’ and adding in its place emission factors determined by the section or regulations approved ‘‘undemonstrated technology or permitting authority to be superior to pursuant to §§ 51.160 through 51.166 of application’’; AP–42 emissions factors, in such cases this chapter; and qq. Revising paragraph (v)(4); where use of emission factors (2) The entire major stationary source rr. Adding new paragraphs (v)(5) demonstrates that the emissions level was permitted, and received the through (v)(9); resulting from the activity or project currently applicable emissions limits for ss. Adding new paragraph (x). will clearly not increase emissions; all emissions units, at the source issued (2) The federally enforceable § 52.21 Prevention of significant in accordance with either this section or emissions limit at the time of the change regulations approved pursuant to deterioration of air quality. is comparable to the emission limit that, §§ 51.165 through 51.166 of this chapter * * * * * considering the air quality designation no more than 120 consecutive months (b) * * * of the area where the source is located, prior to the proposed activity. (2)—* * * would result from a current review in (N) A change to ozone-depleting (iii) * * * accordance with either paragraph (j) of substances with lower ozone-depleting (H) The addition, replacement, or use this section or regulations approved potential under the provisions of of a pollution control project at an pursuant to § 51.165(a)(2) or § 51.166(j) sections 601 and 602 of the Act, existing emissions unit unless the of this chapter, for emissions units of including changes to ozone-depleting pollution control project would result in the same class or source category. The substances emitting equipment needed a significant net increase in Administrator may presume that a to accommodate the change, as long as representative actual annual emissions source satisfies this paragraph the productive capacity of the of any pollutant regulated under this (b)(2)(iii)(L)(2) if: section and the Administrator (i) The activity would occur no later equipment is not increased. determines that this increase would than 120 consecutive months from the * * * * * cause or contribute to a violation of any date of issuance of the permit issued (3) * * * national ambient air quality standard or under either this section or regulations (vi) * * * any maximum allowable increase over approved pursuant to § 51.165 or (C) It has approximately the same the baseline concentration or will have § 51.166 of this chapter, that established qualitative significance for public health an adverse impact on any air quality the currently applicable emissions limit and welfare as that attributed to the related value at any Class I area. For the for the emissions unit; increase from the particular change such purpose of this paragraph, in lieu of the (ii) The activity would occur no later that, at a minimum, the decrease is source’s representative actual annual than 120 consecutive months from the sufficient to prevent the proposed emissions, the emissions levels used for date of issuance of the permit issued increase from causing or contributing to that source in the most recent air quality under regulations approved pursuant to a violation of any national ambient air impact analysis in the area conducted §§ 51.160 through 51.164 of this quality standard or any applicable for the purpose of title I of the Act, if chapter, that established the currently maximum allowable increase over any, may be used. applicable emissions limit for the baseline concentrations or having an * * * * * emissions unit, provided the permit was adverse impact on air quality related (L) Any activity undertaken at an issued under regulations that were values in Class I areas. existing emissions unit for which a determined by the Administrator to * * * * * federally enforceable emissions limit provide for permits that contain (5) (i) Stationary source means any has been established, provided that: emissions limitations that satisfy building, structure, facility, installation, (1) The activity or project will not paragraph (b)(2)(iii)(L)(2) of this section; or stationary internal combustion engine increase the maximum emissions rate, or which emits or which may emit any air 38338 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules pollutant subject to regulation under the operational change did not result in an Ozone-depleting substances (ODS): 100 tons Act. emissions increase. A longer period, not per year. (ii) A stationary source does not to exceed 10 years, may be required by (ii) In reference to a net emissions include emissions resulting directly the Administrator if the Administrator from an internal combustion engine increase or the potential of a source to determines such a period to be more emit a pollutant subject to regulation used for transportation purposes, or representative of normal source post- from a nonroad engine or nonroad under the Act that paragraph (b)(23)(i) change operations. of this section does not list, any vehicle. (22) Complete means, in reference to emissions rate. However, for purposes of an application for a permit required * * * * * the applicability of this section, the (19) Undemonstrated technology or under this section, that the hazardous air pollutants listed under application means any system, process, Administrator has deemed the section 112(b)(1) of the Act, including material, or treatment technology application to contain the information the hazardous air pollutants that may be (including pollution prevention) that necessary (in accordance with the added to the list, are not considered has not been demonstrated in practice, criteria contained in paragraph (n) of subject to regulation under the Act. but would have a substantial likelihood this section) to begin formal review of to operate effectively and achieve: the application. Determining an (iii) Notwithstanding paragraph (i) A greater continuous reduction of application complete for the purpose of (b)(23)(i) of this section, any emissions air pollutant emissions than any beginning formal review does not rate or any net emissions increase demonstrated system; or preclude the Administrator from associated with a major stationary (ii) A comparable emissions reduction requiring additional information as may source or major modification, which at lower cost, or with lower energy be needed to determine whether the would construct within 10 kilometers of input, or with less environmental applicant satisfies all requirements of a Class 1 area, and have an impact on impact. this section. such area equal to or greater than 1 * * * * * (23) Significant means: microgram per cubic meter (24-hour (21) * * * (i) In reference to a net emissions average). (ii) Actual emissions shall be increase or the potential of a source to (iv) In reference to the predicted calculated using the unit’s actual emit any of the following pollutants, a ambient impact that the emissions from operating hours, production rates, and rate of emissions that would equal or a proposed major source or major types of materials processed, stored, or exceed any of the following rates: modification will have for purposes of combusted during any 12 consecutive POLLUTANT AND EMISSIONS RATE determining compliance with the months during the 120 consecutive Carbon monoxide: 100 tons per year national ambient air quality standards, months that precede the commencement Nitrogen oxides: 40 tons per year concentrations which exceed any of the of construction of a proposed physical Sulfur dioxide: 40 tons per year following: or operational change at the source, and Ozone: 40 tons per year of volatile organic compounds any current, federally enforceable Pollutant Averaging Significant limitation on emissions, as required by Particulate matter: 25 tons per year of time impact the Act, including but not limited to, particulate matter emissions; 15 tons per year of PM–10 emissions µ 3 best available control technology, lowest SO2 ...... Annual ...... 1.0 g/m . Lead: 0.6 tons per year 24±Hour ...... 5.0 µg/m3. achievable emission rate (as defined at Fluorides: 3 tons per year 3±Hour ...... 25.0 µg/m3. § 51.165(a)(1)(xiii) of this chapter), Sulfuric acid mist: 7 tons per year PM±10 ...... Annual ...... 1.0 µg/m3. reasonably available control technology, Hydrogen sulfide: 10 tons per year 24±Hour ...... 5.0 µg/m3. 3 or emissions standards for hazardous air Total reduced sulfur (including hydrogen NO2 ...... Annual ...... 1.0 µg/m . pollutants under section 112 of the Act. sulfide): 10 tons per year CO ...... 8±Hour ...... 0.5 mg/m3. Reduced sulfur compounds (including 1±Hour ...... 2.0 mg/m3. * * * * * hydrogen sulfide): 10 tons per year (vi) In lieu of paragraphs (b)(21)(iv) Municipal waste combustor organics and (v) of this section, actual emissions (measured as total tetrathrough octa- (v) In reference to the predicted of the unit following a physical or chlorinated dibenzo-p-dioxins and ambient impact that emissions from a operational change shall equal the dibenzofurans): 3.2×10¥6 megagrams per proposed major source or major representative actual annual emissions year (3.5 x 10¥6 tons per year) modification will have for purposes of of the unit, provided the source owner Municipal waste combustor metals determining compliance with the or operator maintains and submits to the (measured as particulate matter): 14 maximum allowable increases in megagrams per year (15 tons per year) Administrator, on an annual basis for a Municipal waste combustor acid gases pollutant concentrations contained in period of 5 years from the date the unit (measured as sulfur dioxide and hydrogen paragraph (c) of this section, resumes regular operation, information chloride): 36 megagrams per year (40 tons concentrations which exceed any of the demonstrating that the physical or per year) following:

Class I Class II Class III Pollutant Averaging time Significant im- Significant impact Significant impact pact

3 3 3 SO2 ...... Annual ...... 0.1 µg/m ...... 1.0 µg/m ...... 1.0 µg/m . 24-Hour ...... 0.2 µg/m 3 ...... 5.0 µg/m 3 ...... 5.0 µg/m 3. 3-Hour ...... 1.0 µg/m 3 ...... 25.0 µg/m 3 ...... 25.0 µg/m 3. PM±10 ...... Annual ...... 0.2 µg/m 3 ...... 1.0 µg/m 3 ...... 1.0 µg/m 3. 24-Hour ...... 0.3 µg/m 3 ...... 5.0 µg/m 3 ...... 5.0 µg/m 3. 3 3 3 NO2 ...... Annual ...... 0.1 µg/m ...... 1.0 µg/m ...... 1.0 µg/m . Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38339

* * * * * (39) Federal Class I area means any controlled, or 90 percent or more of the (27) Indian Reservation means all Federal lands within the United States control technology’s designed land within the limits of any Indian either designated as Class I pursuant to specifications. Reservation under the jurisdiction of the section 162(a) of the Act (and which (44) Pollution prevention means any United States Government, may not be redesignated) or activity that through process changes, notwithstanding the issuance of any redesignated as Class I pursuant to product reformulation or redesign, or patent, and including rights-of-way either paragraph (g) of this section or substitution of less polluting raw running through the reservation. § 51.166(g) of this chapter. materials, eliminates or reduces the * * * * * (40) Federal official means the Federal release of air pollutants (including (32) Pollution control project means: official charged with direct fugitive emissions) and other pollutants (i) Any activity or project undertaken responsibility for management of any to the environment prior to recycling, at an existing emissions unit which, as lands within a Federal Class I area. treatment, or disposal; it does not mean its primary purpose, reduces emissions (41) Air quality related value means, recycling (other than certain ‘‘in-process of air pollutants from such unit. Such for purposes of this section, visibility or recycling’’ practices), energy recovery, activities or projects do not include the a scenic, cultural, physical, biological, treatment, or disposal. replacement of an existing emissions ecological, or recreational resource that (45) Plantwide applicability limit unit with a newer or different unit, or may be affected by a change in air means a plantwide federally enforceable the reconstruction of an existing quality, as defined by the Federal Land emissions limitation established for a emissions unit, and are limited to any Manager for Federal lands and as stationary source such that any of the following: defined by the applicable State or subsequent physical or operational (A) The installation of conventional or Indian Governing Body for nonfederal change resulting in plantwide emissions advanced flue gas desulfurization, or lands. that remain less than the limit are (42) Adverse impact on air quality sorbent injection for SO2; excluded from preconstruction review (B) Electrostatic precipitators, related values means, for purposes of under this section. baghouses, high efficiency multiclones, this section, a deleterious effect on any (46) Plantwide applicability limit or scrubbers for particulate matter or air quality related value identified by a major modification means, other pollutants; Federal Land Manager, resulting from notwithstanding the requirements of paragraph (b)(2) of this section, any (C) Flue gas recirculation, low-NOX emissions from a proposed major source burners, selective non-catalytic or major modification, that interferes increase in the emissions rate, in tons reduction or selective catalytic with the management, protection, per year, over the plantwide applicability limit. Any emissions reduction for NOX; preservation, or enjoyment of such air (D) Regenerative thermal oxidizers, quality related values of a Federal Class increase of volatile organic compounds catalytic oxidizers, condensers, thermal I area. This determination shall be made shall be considered an increase for. incinerators, flares, or carbon absorbers on a case-by-case basis taking into (47)(i) Nonroad engine means, except for volatile organic compounds or account existing air quality conditions. as discussed in paragraph (b)(46)(ii) of hazardous air pollutants; (43) Demonstrated in practice means, this section, any internal combustion (E) Activities or projects undertaken for the purposes of this section, any engine: to accommodate switching to an control technology that has been— (A) In or on a piece of equipment that inherently less polluting fuel, including (i) Listed in or required by any of the is self-propelled or that serves a dual but not limited to, natural gas or coal following: purpose by both propelling itself and reburning, or the cofiring of natural gas (A) The EPA’s RACT/BACT/LAER performing another function (such as and other inherently less polluting Clearinghouse; garden tractors, off-highway mobile fuels, for the purpose of controlling (B) A major source construction cranes and bulldozers); (B) In or on a piece of equipment that emissions, and including any activity permit issued pursuant to either part C is intended to be propelled while that is necessary to accommodate or D of title I of the Act; (C) An emissions limitation contained performing its function (such as switching to an inherently less polluting in a federally-approved plan, excluding lawnmowers and string trimmers); or fuel; any emissions limitations established by (C) That, by itself or in or on a piece (F) Pollution prevention projects permits issued pursuant to programs for of equipment, is portable or which the Administrator has non-major sources; transportable, meaning designed to be determined through a process consistent (D) A permit or standard under either and capable of being carried or moved with § 51.161 of this chapter to be section 111 or 112 of the Act; and from one location to another. Indicia of environmentally beneficial. Pollution (E) The EPA’s Alternative Control transportability include, but are not prevention projects that may result in an Techniques documents and Control limited to, wheels, skids, carrying unacceptable increased risk from the Techniques Guidelines; or handles, dolly, trailer, or platform. release of hazardous pollutants are not (ii) Notwithstanding paragraph (ii) An internal combustion engine is environmentally beneficial; and (b)(43)(i) of this section, installed and not a nonroad engine if: (G) Installation of a technology, for operating on an emissions unit (or units) (A) The engine is used to propel a purposes set forth in paragraph (b)(32) which: motor vehicle or a vehicle used solely of this section, which is not listed in (A) Has operated at a minimum of 50 for competition, or is subject to paragraphs (b)(32)(i) (A) through (E) of percent of design capacity for 6 months; standards promulgated under section this section but meets the following: and 202 of the Act; (1) Its effectiveness in reducing (B) The pollution control efficiency (B) The engine is regulated by a emissions has been demonstrated in performance has been verified with Federal new source performance practice; and either: standard promulgated under section 111 (2) It is determined by the (1) A performance test; or of the Act; or Administrator to be environmentally (2) Performance data collected at the (C) The engine otherwise included in beneficial. maximum design capacity of the paragraph (b)(47)(i) of this section * * * * * emissions unit (or units) being remains or will remain at a location for 38340 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules more than 12 consecutive months, or a (G) Fluorides: 0.25 micrograms per control technology shall then be shorter period of time for an engine cubic meter, 24-hour average; evaluated in the same manner. located at a seasonal source. A location (H) Hydrogen sulfide: 0.2 micrograms Documentation supporting the is any single site at a building, structure, per cubic meter, 1-hour average; demonstration shall be included in the facility, or installation. Any engine (or (I) Total reduced sulfur: 10 public record pursuant to paragraph engines) that replaces an engine at a micrograms per cubic meter, 1-hour (q)(2) of this section. location and that is intended to perform average; (ii) The control technology the same or similar function as the (J) Reduced sulfur compounds: 10 alternatives considered in paragraph engine replaced will be included in micrograms per cubic meter, 1-hour (j)(5)(i) of this section shall be based calculating the consecutive time period. average; or upon control technologies and methods An engine located at a seasonal source * * * * * for the same and similar source is an engine that remains at a seasonal (14) The requirements of this section categories, i.e., those categories source during the full annual operating do not apply to any stationary source including sources that have similar period of the seasonal source. For with respect to each hazardous air emissions stream characteristics. purposes of this paragraph (b)(47)(ii)(C), pollutant listed pursuant to section 112 (iii) On or after the date that an a seasonal source is a stationary source of the Act, as well as all pollutants that application is complete pursuant to that remains in a single location on a may be added to such list under the paragraph (n) of this section, the permit permanent basis (i.e., at least 2 years) provisions of section 112(b)(2) of the applicant will not be required to and that operates at that single location Act. However, the applicable provisions consider control technology alternatives approximately three months (or more) of this section shall apply to any identified through public comments that each year. This paragraph (b)(47)(ii)(C) pollutant listed pursuant to sections are in addition to those alternatives does not apply to an engine after the 112(b)(1) or (b)(2) of the Act that is required under paragraph (j)(5)(i)(A) of engine is removed from the location. deleted from such list under the this section, unless the Administrator (48) Nonroad vehicle means a vehicle provisions of section 112(b)(3) of the determines that, based on information that is powered by a nonroad engine Act. Any hazardous air pollutants listed provided pursuant to paragraph (q)(2) of and that is not a motor vehicle or a in section 112 of the Act which are this section, the alternatives warrant vehicle used solely for competition. regulated as constituents or precursors further consideration by the applicant. (49) Stationary internal combustion of a more general pollutant listed under (iv) After the date on which the public engine means: section 108 of the Act are still subject comment period is closed for a permit (i) Any internal combustion engine to the provisions of this section, issued pursuant to this section, the that is regulated by a Federal new notwithstanding section 112(b)(6) of the applicant for such permit will not be source performance standard Act. required to consider any control promulgated under section 111 of the (j) * * * technology that has not been identified Act; or (5)(i) In determining best available either prior to or during the public (ii) Any internal combustion engine control technology: comment period. that is none of the following: a nonroad (A) The applicant shall identify and (6) For determinations of best engine, an engine used to propel a evaluate all available and technically available control technology required motor vehicle or a vehicle used solely feasible control technology alternatives under this section, the Administrator for competition, or an engine subject to that have been demonstrated in practice shall include the control technology standards promulgated under section pursuant to paragraph (b)(43)(i) of this information in the EPA’s RACT/BACT/ 202 of the Act. section prior to the date on which the LAER Clearinghouse within 60 days * * * * * permit application is complete and after permit approval. (i) * * * pursuant to paragraph (b)(43)(ii) of this * * * * * (8) * * * section 90 days prior to the date on (n) Complete application criteria. (i) The emission increase of the which the permit application is (1)(i) The Administrator shall pollutant from a new stationary source complete; determine that a permit application is or the net emissions increase of the (B) All control technology alternatives complete or deficient based on the pollutant from a modification would identified pursuant to paragraph consideration of determinations, cause, in any area, air quality impacts (j)(5)(i)(A) of this section shall be ranked analyses and other information less than the following amounts: and evaluated in descending order of contained in the application, and (A) Carbon monoxide: 575 control effectiveness. The alternative adequacy thereof, as specified in micrograms per cubic meter, 8-hour providing the maximum degree of paragraphs (n)(2) through (n)(5) of this average; emissions reduction shall be established section. (B) Nitrogen dioxide: 14 micrograms as best available control technology (ii) The Administrator shall notify per cubic meter, annual average; unless it is demonstrated to the each applicant, in accordance with (C) Sulfur dioxide: 13 micrograms per satisfaction of the Administrator that, procedures set forth in § 124.3(c) of this cubic meter, 24-hour average; based upon technical considerations, or chapter, as to either the completeness of (D) Ozone; 1 energy, environmental, and economic the application or any deficiency in the (E) Particulate matter: 10 micrograms impacts and other costs, the maximum application or information submitted. In per cubic meter PM–10, 24-hour degree of emissions reduction is not the event of such a deficiency, the date average; achievable in that case. If the applicant of receipt of the complete application (F) Lead: 0.1 micrograms per cubic identifies the technology providing the shall be the date on which the meter, 3-month average; maximum degree of emissions reduction Administrator received all required as the best available control technology, information. 1 No de minimis air quality level is provided for then the Administrator may waive the (2) Information necessary to ozone. However, any net increase of 100 tons per determine a permit application year or more of VOC subject to PSD would be requirement to analyze or evaluate less required to perform an ambient impact analysis, effective control technologies. complete shall include: including the gathering of ambient air quality data. Otherwise, the next most stringent * * * * * Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38341

(iii) (A) A detailed description of the date a completeness determination is application requested within 7 days system of continuous emissions made pursuant to paragraph (n)(1) of from the date information about such reduction which the applicant has this section, a written notice alleging application is registered on the submitted in a permit application for a that emissions of a particular pollutant applicable EPA electronic bulletin board source or modification, to qualify either from a proposed major source or major (in accordance with paragraph (n)(4) of as best available control technology, or modification may cause or contribute to this section). for an undemonstrated technology a change in the air quality in such area (5) Completeness determination waiver in accordance with paragraph (s) and identifying the potential adverse coordination. Prior to making the of this section; and impact of such change on affected air completeness determination under (B) All information used or consulted quality related values identified in the paragraph (n)(1) of this section, the by the applicant in recommending a area by the Federal Land Manager, a Administrator shall: system of continuous emissions permit shall not be issued unless the (i) Ensure that the applicant has reduction as either the best available owner or operator of such source: provided any analysis required pursuant control technology or an approvable (1) Demonstrates to the satisfaction of to paragraph (p)(2)(i) of this section; undemonstrated technology. the Administrator that emissions will (ii) Give the Federal Land Manager 30 (iv) Information and data used to not cause or contribute to ambient days from receipt of an application to perform all required analyses or pollutant concentrations in the Federal review the application, where the determinations under paragraphs (o), Class I area which violate the maximum Federal Land Manager has received (p), (r), (v) and (x) of this section, as allowable increases over baseline such application pursuant to paragraph applicable. concentrations; and (p)(4) of this section; (3) Upon request of the Administrator, (2) Provides an analysis of the (iii) Consider any comments provided the owner or operator shall provide any potential impacts on air quality related by the Federal Land Manager within the information and data used to perform all values at the Federal Class I area. time period under paragraph (p)(5)(ii) of required analyses or determinations (B) A permit otherwise prohibited this section; and (iv) Consult with the Federal Land under paragraphs (k), (l) and (m) of this under paragraph (p)(2)(i)(A)(1) of this Manager about any inconsistency section. section may be issued in accordance between the determination by the (4) An application shall not be with the variance provisions in Administrator and the Federal Land considered complete unless the permit paragraphs (p)(8) through (p)(11) of this Manager’s recommendations. application has been registered on the section. (ii) Available information on air (6) Preliminary and final permit applicable EPA electronic bulletin determination—No Class I increment board. To register, at a minimum, the quality related values and analytical methods. The Federal Land Manager or violation. Where the Administrator has following must be provided: determined that the emissions from the (i) Name and type of source; Federal Official shall, upon request, provide to the owner or operator of a proposed major source or major (ii) Nature of proposed project, i.e., modification will not cause or new facility or modification; proposed major source or major modification that may have an adverse contribute to ambient pollutant (iii) Proposed location of the source in concentrations in the Federal Class I State/county (including Universal impact on air quality related values in a Federal Class I area all available area which violate the maximum Transverse Mercator coordinates) and allowable increases over baseline the distance between the source and information about such values and methods to analyze potential impacts. concentrations: each Class I area within 250 kilometers; (i) The Administrator shall not issue (iv) Anticipated allowable emissions, (iii) Consultation with Federal Land Manager. The Administrator shall a preliminary permit determination or increase in emissions rate, for each until the Federal Land Manager has affected air pollutant regulated under provide for consultation and coordination with the Federal Land been given at least 60 days (from the the Act; date of issuance of the completeness (v) Source contact mailing address Manager including the procedures contained in paragraphs (p)(3) through determination required under paragraph and telephone number, and (n)(1) of this section that the permit is (vi) The agency responsible for (p)(6) of this section. (3) Pre-application coordination. For a complete) to submit a demonstration issuing the permit. proposed major source or major that a proposed major source or major (5) Prior to making a completeness modification within 100 kilometers of a modification will have an adverse determination, the Administrator shall Federal Class I area: impact on air quality related values. provide for any Federal Land Manager (i) The affected Federal Land Manager (ii) If the Administrator agrees with review and coordination required under shall be notified within 30 days from the Federal Land Manager’s paragraph (p)(5) of this section. receipt by the Administrator of advance demonstration under paragraph (p)(6)(i) * * * * * notification of a permit application; and of this section, the Administrator shall (p) Sources potentially impacting (ii) The affected Federal Land propose to deny the permit. Federal Class I areas. Manager shall be given reasonable (iii) If the Administrator is not (1) Protection of air quality related notice and an opportunity to participate satisfied with the Federal Land values. *** in pre-application meetings with the Manager’s demonstration under (2) General requirements. applicant. paragraph (p)(6)(i) of this section, the (i) Notification of potential impacts (4) Permit application coordination. Administrator shall consult with the on a Federal Class I area and (i) The Federal Land Manager of any Federal Land Manager, reference the requirement for impact assessment. Federal Class I area within 100 Federal Land Manager’s demonstration (A) Where the Federal Official, kilometers of a proposed major source and the Administrator’s proposed Federal Land Manager, the or major modification shall be provided rejection of the demonstration in the Administrator, the Governor of an with a copy of the permit application public notice announcing the adjacent State, or the governing body of and other relevant information, and preliminary permit determination, and an adjacent Indian Tribe containing a (ii) The Federal Land Manager shall provide an explanation in writing (for Federal Class I area, files, prior to the be provided with a copy of a permit inclusion in the public record along 38342 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules with the Federal Land Manager’s (iii) Date installed and date (iii) Identification and classification of demonstration) of the reasons for operational; potential failure modes and associated proposing to reject the Federal Land (iv) Performance requirements contingency measures. Manager’s demonstration. The specified under applicable permits, (6) If, by the date established in Administrator’s written explanation implementation plans or Federal paragraph (v)(2)(ii) of this section, the shall address, at a minimum, the standards; and undemonstrated technology or following: (v) Available test or performance data application does not achieve the (A) The basis for any disagreement or identification of source of additional permitted emissions limit, but actual with the data and analyses contained in information. emissions are equal to or less than the the Federal Land Manager’s (3)(i) After any cut-off date best available control technology demonstration of adverse impact on air established in accordance with emissions limit referenced in the quality related values; paragraph (j)(5)(iii) of this section, the permit, the Administrator shall: (B) Any conclusions the Administrator shall notify a permit (i) Issue a final permit with the Administrator reaches, about whether applicant within 10 working days from emissions limit equal to the the projected impacts of the proposed the date of receipt of a public comment undemonstrated technology or source’s emissions will have an adverse concerning any control technology application’s consistently achieved impact on air quality related values, that alternatives that the Administrator actual emissions rate; and are inconsistent with the conclusions determines to warrant further (ii) Report the final permit limits to reached in the demonstration submitted consideration by the applicant; and the EPA’s RACT/BACT/LAER by the Federal Land Manager; and (ii) The Administrator shall make Clearinghouse as a demonstrated control (C) Any measures undertaken to available in the public record all technology. mitigate the potential adverse impacts of information that was submitted with (7) If, by the date established in proposed emissions increases, including public comment regarding control paragraph (v)(2)(ii) of this section, the the estimated effect of any mitigation. technology alternatives and provide the actual emissions from the (iv) In the final permit determination, basis for its decision to either require or undemonstrated technology or the Administrator shall address any not require the permit applicant to application constitute marginal failure comments made by the Federal Land further consider such control the owner or operator may petition the Manager concerning the Administrator’s technology alternatives. Administrator to permit the preliminary determination. * * * * * undemonstrated technology or (7) Mitigation of adverse impacts. The (v) Undemonstrated technology or application to operate at its actual Administrator may issue a permit for a application waiver. emissions limit. Accordingly, the proposed major source or major (1) An owner or operator of a Administrator shall either: modification that would otherwise be proposed major stationary source or (i) Approve the petition and proceed denied a permit under paragraph (p)(6) major modification may satisfy the in accordance with paragraphs (v)(6) (i) of this section, if the Administrator requirements of paragraph (j) of this and (ii) of this section; or determines, in consultation with the section through the use of an (ii) Disapprove the petition and Federal Land Manager, that the source undemonstrated technology or require the owner or operator to comply has mitigated its adverse impact on air application as set forth in this section. with paragraph (v)(4) of this section. quality related values. The owner or The owner or operator shall provide to (8) If, at any time prior to or on the operator of a proposed major source or the Administrator a written request for date established in paragraph (v)(2)(ii) major modification may mitigate an approval of an undemonstrated of this section, the actual emissions adverse impact by obtaining enforceable technology or application as part of the from the undemonstrated technology or and permanent emissions reductions of permit application. application constitute gross failure: sufficient amount and in such location (2) The Administrator may approve a (i) The Administrator shall withdraw that the reductions will offset the system of undemonstrated technology or approval pursuant to paragraph (v)(4) of change in air quality in the Federal application for a particular source or this section; and Class I area that would have resulted modification if: (ii) The owner or operator shall from the proposed source. * * * * * mitigate all emissions increases above * * * * * (4) If the Administrator withdraws the applicable reference best available (q) Public participation. approval of a system of undemonstrated control technology emissions limit by (1) The Administrator shall follow the technology or application, the owner or reducing actual emissions. applicable procedures of part 124 of this operator shall bring the affected (9) The Administrator shall limit the chapter in processing applications emissions unit(s) into compliance with number of waivers granted to the under this section. The Administrator the reference best available control number necessary to ascertain whether shall follow the procedures at technology emissions limit within 18 or not such system complies with § 51.166(q) of this chapter to the extent months from the date of withdrawal. sections 111(j)(1)(A)(ii) and (iii) of the that the procedures of part 124 of this (5) The Administrator shall include, Act. chapter do not apply. as a minimum, the following * * * * * (2) The following information must be information in a waiver issued pursuant (x) Plantwide applicability limit. submitted with any new control to paragraph (v) of this section: (1) Applicability. The owner or technology alternatives recommended (i) The undemonstrated technology or operator of an existing major stationary by the public for the Administrator to application’s emissions control source may request the Administrator to consider in determining best available performance objective and the approve a plantwide applicability limit control technology pursuant to applicable reference best available for any one or more pollutants, and the paragraph (j)(5) of this section: control technology emissions limit; Administrator may approve a plantwide (i) Name and location of the source (ii) The marginal and gross failure applicability limit for an existing major utilizing the control technology; emissions limits as defined by the stationary source, in accordance with (ii) Manufacturer, type and model of Administrator on a case-by-case basis; paragraphs (x)(2) through (x)(5) of this pollution control device; and section. Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38343

(2) Procedure. A plantwide modification as if it were a major prohibition shall apply until the applicability limit for an existing major modification, except that in lieu of Administrator approves a plan for such stationary source may be established paragraph (j)(3) of this section, a area as meeting the applicable only through a procedure consistent plantwide applicability limit major requirements of part D of title I of the with § 51.161 of this chapter, and with modification shall apply best available Act as amended (NSR permitting at least 30 days allowed for public control technology for each pollutant requirements) or subpart 5 of part D of notice and opportunity for comment. subject to regulation under the Act if an title I of the Act as amended (relating to (3) Emissions limitations and emissions increase above the plantwide attainment of the national ambient air conditions. applicability limit would occur; and quality standards for sulfur dioxide), as (i) A plantwide applicability limit (iii) The best available control applicable. shall be established based on either: technology requirement applies to each (b) Permits to construct and operate as (A) Plantwide actual emissions (not to emissions unit that contributes to the required by permit programs under exceed current allowable emissions), emissions increase above the plantwide section 172(c)(5) of the Act may not be including a reasonable operating applicability limit. issued for new or modified major margin, less than the applicable (5) Plantwide applicability limit stationary sources proposing to locate in significant emissions rate; or reevaluation. nonattainment areas or areas in a (B) Source-wide limits on annual (i) The Administrator shall reevaluate transport region where the emissions established in a permit issued the plantwide applicability limit Administrator has determined that the within the immediately preceding 5 emissions limitations pursuant to— applicable implementation plan is not years under regulations approved (A) Permit renewal and public being adequately implemented for the pursuant to § 51.165 of this part, where notification procedures under part 70 or nonattainment area or transport region the source-wide emissions limits were 71 of this chapter; or completely offset and relied upon in an (B) Another proceeding with public in which the proposed source is to be approved State attainment notice and opportunity for public constructed or modified in accordance demonstration plan. comment. with the requirements of part D of title (ii) Any plantwide applicability limit (ii) As part of the reevaluation I of the Act. emissions limitations shall be required under paragraph (x)(5)(i) of this (c) Whenever, on the basis of any achievable through application of section, the Administrator may reduce information, the Administrator finds production processes or available permitted emissions limitations or that a State is not in compliance with methods, systems, and techniques otherwise adjust (but not increase) any requirement or prohibition of the including, but not limited to, emissions permitted emissions limitations to Act relating to the construction of new control equipment, fuel cleaning or reflect: sources or the modification of existing treatment, fuel combustion techniques, (A) Air quality concerns arising after sources, the Administrator may issue an substitution of less polluting materials, the approval of the plantwide order under section 113(a)(5) of the Act or limits on production that represent applicability limit; prohibiting the construction or normal source operations. (B) Changes at the source; or modification of any major stationary (iii) Specific terms and conditions (C) Other appropriate considerations. source in any area to which such that assure the practical enforceability (iii) The Administrator shall adjust requirement applies. of plantwide applicability limit the source’s plantwide applicability (d) The restrictions in paragraphs (a) emissions limitations shall be contained limit emissions limitations to reflect and (b) of this section apply only to in a federally enforceable permit new applicable requirements as they major stationary sources of emissions applicable to the source. become effective. that cause or contribute to (iv) The emissions limitations and * * * * * concentrations of the pollutant (or conditions established for a plantwide 4. Section 52.24 is revised to read as precursors, as applicable) for which the applicability limit shall not relieve any follows: transport region or nonattainment area owner or operator of the responsibility was designated such, and for which the to comply fully with any applicable § 52.24 Statutory restriction on new applicable implementation plan is not control technology requirements. sources. being carried out in accordance with, or (4) Plantwide applicability limit (a) Any area designated does not meet, the requirements of part modifications. nonattainment pursuant to section (i) Notwithstanding paragraphs (b)(2) 107(d) of the Act to which, immediately D of title I of the Act. and (b)(3) of this section (the definitions prior to the enactment of the (e) For any transport region or any for major modification and net Amendments to the Act of 1990 area designated as nonattainment for emissions increase), any physical or (November 15, 1990), a prohibition of any national ambient air quality operational change consistent with construction or modification of major standard, the restrictions in paragraphs plantwide applicability limit terms and stationary sources was applied, shall (a) and (b) of this section shall apply to conditions and paragraph (b)(3)(vi)(C) of retain that prohibition if such any major stationary source or major this section shall not constitute a major prohibition was applied by virtue of a modification that would be major for the modification for the pollutants covered finding of the Administrator that the pollutant (or precursors, where by the plantwide applicability limits. State containing such an area: applicable) for which the area is All decreases in emissions shall have (1) Failed to submit an designated nonattainment or a transport approximately the same qualitative implementation plan meeting the region, if the stationary source or major significance for public health and requirements of an approvable new modification would be constructed welfare as that attributed to the increase source review permitting program; or anywhere in the designated from the particular change; (2) Failed to submit an nonattainment area or transport region. (ii) Requirements equivalent to those implementation plan that provided for A major stationary source or major contained in paragraphs (j) through (r) timely attainment of the national modification that is major for volatile of this section shall apply to any ambient air quality standard for sulfur organic compounds is also major for plantwide applicability limit major dioxide by December 31, 1982. This ozone. 38344 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

(f) The definitions in § 51.165(a) of (1) If the construction moratorium (h) This section does not apply to this chapter shall apply under this imposed pursuant to this section is still major stationary sources or major section. in effect for the nonattainment area or modifications locating in a clearly (g) At such time that a particular transport region in which the source or defined part of a nonattainment area or modification is located, then the permit source or modification becomes a major transport region (such as a political may not be so revised; or subdivision of a State), where the EPA stationary source or major modification (2) If the construction moratorium is solely by virtue of a relaxation in any finds that a plan which meets the no longer in effect in that area, then the requirements of part D of title I of the enforceable limitation which was requirements of § 51.165(a) of this established after August 7, 1980, on the Act is in effect and is being chapter shall apply to the source or implemented in that part. capacity of the source or modification modification as though construction had otherwise to emit a pollutant, such as a not yet commenced on the source or [FR Doc. 96–17544 Filed 7–22–96; 8:45 am] restriction on hours of operation, then: modification. BILLING CODE 6560±50±P federal register July 23,1996 Tuesday Rules Medical Devices;FinalandProposed 21 CFRPart803,etal. Food andDrugAdministration Services Health andHuman Department of Part III 38345 38346 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations

DEPARTMENT OF HEALTH AND including certification, that were reporting requirements, as well as the HUMAN SERVICES published as a tentative final rule on foreign manufacturer’s registration November 26, 1991, became effective by listing and premarket notification Food and Drug Administration operation of law on May 28, 1992. submissions. After issuing the December After issuing the December 1995 final 1995 final rule, FDA received comments 21 CFR Parts 803, 804, and 807 rule, FDA received numerous requests from industry objecting to these [Docket No. 91N±0295] for reconsideration of the certification requirements as being unduly requirements and for reconsideration of burdensome. In response to these RIN 0910±AA09 issues relating to U.S. designated agent comments, FDA is publishing a requirements. These comments led FDA Medical Devices; Medical Device proposed rule, elsewhere in this issue of to meet with the Health Industry Distributor and Manufacturer the Federal Register, addressing the Manufacturers Association (HIMA) and certification and U.S. designated agent Reporting; Certification, Registration, several industry representatives on issues. FDA intends that the Listing, and Premarket Notification April 19, May 23, and June 13, 1996. requirements relating to distributor and Submission; Stay of Effective Date; During these meetings, issues manufacturer certification, and to U.S. Revocation of Final Rule concerning industry burdens and designated agents, will not be in effect AGENCY: Food and Drug Administration, procedures relating to the certification until at least 75 days after the date of HHS. and U.S. designated agent requirements publication in the Federal Register of a ACTION: Final rule. were put forth that had previously not new final rule. been fully considered. The Administrative Procedure Act SUMMARY: In response to numerous Section 519(d) of the act (21 U.S.C. (Pub. L. 79–404) and FDA regulations requests for the Food and Drug 360i(d)) states that each manufacturer provide that the agency may issue a Administration (FDA) to consider and distributor required to make reports regulation without notice and comment further comments concerning medical under section 519(a) (21 U.S.C. 360i(a)) procedures when the agency for good device reporting (MDR) certification and of the act must submit annual cause finds (and incorporates the U.S. designated agent requirements, statements certifying the number of finding and a brief statement of reasons FDA is staying the effective date of these reports that were filed or that no reports thereof in the rules issued) that notice two specific provisions of the adverse were filed during the previous 12-month and public procedure thereon are event reporting final rule that was period. The certification regulations for impracticable, unnecessary, or contrary published in the Federal Register of manufacturers and distributors require to the public interest (5 U.S.C. 553(b)(8); December 11, 1995. Specifically, these that the certification include the number § 10.40(e)(1) (21 CFR 10.40 (e)(1)).) FDA provisions relate to manufacturer of MDR’s filed during the previous 12- finds that there is good cause for certification and U.S. designated agent month period and that all MDR dispensing with notice and comment requirements. In addition, for reportable events have been submitted procedures to stay the effective date of consistency purposes, FDA is revoking (§§ 803.57 and 804.30 (21 CFR 804.30)). the manufacturer certification and U.S. the distributor reporting certification FDA required the certification that all designated agent reporting provisions, requirement that went into effect on MDR reportable events were filed on the (§§ 803.3(n)(4), 803.57, 803.58, 807.3(r), May 28, 1992. basis of legislative history citing the 807.20(a)(6), and 807.40) and for General Accounting Office report EFFECTIVE DATE: July 23, 1996. revoking the certification requirements recommending that certification state for distributors (§ 804.30) because such FOR FURTHER INFORMATION CONTACT: Earl that the reporter ‘‘filed a specific notice and comment procedures are W. Robinson, Center for Devices and number of reports * * * and that the impracticable and contrary to the public Radiological Health (HFZ–530), Food firm received or became aware of interest. and Drug Administration, 1350 Piccard information concerning only these Notice and comment rulemaking on Dr., Rockville, MD 20850, 301–594– events.’’ (H. Rept. 808, 101st Cong., 2d the postponement of manufacturer 2735. sess., 23 (1990).) FDA, in response to certification and U.S.designated agent SUPPLEMENTARY INFORMATION: In the comments asking who should certify for requirements is impracticable. FDA was Federal Register of December 11, 1995 manufacturers, also required in the not aware of a number of significant (60 FR 63578), FDA published a final December 1995 final rule that the issues relating to these requirements rule amending parts 803 and 807 (21 certifier must be the president, chief until after publication of the December CFR parts 803 and 807) to require executive officer, U.S. designated agent 1995 final rule. Since that time, FDA medical device manufacturers, of a foreign manufacturer, or other has had numerous meetings with HIMA including U.S. designated agents of official most directly responsible for the and industry representatives and foreign manufacturers, to report adverse firm’s operations. internal meetings to decide the best events related to medical devices under After the final rule was issued, FDA approach to understand and resolve a uniform reporting system (hereinafter received comments taking the position issues concerning the rule. The last referred to as the December 1995 final that the certifier may more meeting with HIMA and industry rule). This rule also required U.S. appropriately be a person with more representatives occurred on June 13, designated agents to register, list, and direct involvement with the reporting 1996. Without the issuance of a stay submit premarket notifications on requirements. Comments also objected under good cause procedures, the behalf of foreign manufacturers. The to requiring that the reporter certify all certification and U.S. designated agent effective date of this rule was to be April reportable events have been filed on the requirements would become effective on 11, 1996. On April 11, 1996 (61 FR basis that such a requirement was not July 31, 1996. 16043), FDA extended the effective date specifically required in the act, and that In addition, notice and comment to July 31, 1996. potential liability would be created. rulemaking, in this instance, on the stay Earlier, in the Federal Register of The December 1995 final rule also of the present certification requirements September 1, 1993 (58 FR 46514), FDA required that foreign firms identify a would be contrary to the public interest. published a notice announcing that the U.S. designated agent who would be Because there is not enough time to distributor reporting requirements, responsible for the foreign firm’s MDR allow notice and comment on the issue Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Rules and Regulations 38347 of staying the effective date before it foreign manufacturers. The original 21 CFR part 807 occurs, the certification and U.S. medical device reporting regulation that Confidential business information, designated agent requirements would be became effective December 13, 1984, Imports, Medical devices, Reporting and in effect only for the interim period defined a manufacturer who was recordkeeping requirements. between the effective date of the final required to submit MDR reports as any Therefore, under the Federal Food, manufacturer rule, July 31, 1996, and person who is required to register under Drug, and Cosmetic Act and under the date the agency expects that these part 807. Because foreign manufacturers authority delegated to the Commissioner provisions, after issuance of a are not required to register, the of Food and Drugs, 21 CFR parts 803, reproposed rule, would be revised and December 1984 regulation did not apply 804, and 807 are amended as follows: become final a second time. This result to them. The revised December 1995 would cause industry to implement final rule, however, no longer defines a PART 803ÐMEDICAL DEVICE costly certification and U.S. designated manufacturer who is required to report REPORTING agent procedures and contractual adverse events as a person who is arrangements that would most likely required to register under part 807. PART 807ÐESTABLISHMENT have to be changed with additional cost Rather, under § 803.3(n) of the REGISTRATION AND DEVICE LISTING after these requirements are reproposed December 1995 final rule, a FOR MANUFACTURERS AND and refinalized. manufacturer means any person who DISTRIBUTORS OF DEVICES It is also against the public interest to manufactures, prepares, propagates have a certification requirement in effect 1. In the revision of part 803 and the compounds, assembles, or processes a for distributors, while not having such amendments to part 807 which were device by chemical, physical, biological, a requirement in effect for published at 60 FR 63578 (December 11, or other procedure. Accordingly, foreign manufacturers. The MDR system is 1995), the effective date of which was manufacturers clearly fit within the intended to operate as a uniform extended until July 31, 1996, at 61 FR definition of manufacturers who are reporting system where user facilities, 16043 (April 11, 1996), the following required to submit MDR’s under the distributors, and manufacturers provisions are stayed until further December 1995 final rule. This means efficiently share, forward, and provide notice: complementary information on the same that, on July 31, 1996, foreign adverse events. Having a system manufacturers will be fully subject to A. §§ 803.3(n)(4), 803.57, and 803.58. whereby distributors certify reports and the same requirements of part 803 B. The addition of § 807.3(r) and manufacturers do not certify reports applicable to all domestic 807.20(a)(6); and would hinder the uniformity of this manufacturers. This includes, but is not C. The revision of § 807.40. program and result in regulatory limited to, the requirements for written procedures (§ 803.17), MDR event files PART 804ÐMEDICAL DEVICE confusion. DISTRIBUTOR REPORTING For all the reasons stated above, FDA (§ 803.18), individual adverse event concludes, under 5 U.S.C. 553(b)(8) and reports (§§ 803.50 and 803.52), 5-day 2. The authority citation for 21 CFR § 10.40(e)(1), that there is good cause for reports (§ 803.53), baseline reports part 804 continues to read as follows: staying the effective date of the (§ 803.55), and supplemental reports Authority: Secs. 502, 510, 519, 520, certification and U.S. designated agent (§ 803.56). In addition, existing 701, 704 of the Federal Food, Drug, and provisions of the December 1995 final regulations will remain in effect Cosmetic Act (21 U.S.C. 352, 360, 360i, rule and for revoking the distributor pending the stay that permits foreign 360j, 371, 374). certification requirements of the May manufacturers to register (§ 807.40(a)) 28, 1992 rule. and submit premarket notifications § 804.30 [Removed] Foreign manufacturers have a (§ 807.81), and require them to list their 3. Section 804.30 is removed. responsibility for compliance with all devices (§ 807.40(b)). medical device reporting requirements Dated: July 16, 1996. which will not be affected by the stay List of Subjects William K. Hubbard, of the effective date of the U.S. 21 CFR parts 803 and 804 Associate Commissioner for Policy designated agent requirements. This is Coordination. because the December 1995 final rule Imports, Medical devices, Reporting [FR Doc. 96–18700 Filed 7–19–96; 2:26 pm] contained a significant change regarding and recordkeeping requirements. BILLING CODE 4160±01±F 38348 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules

DEPARTMENT OF HEALTH AND FOR FURTHER INFORMATION CONTACT: Earl (MDR’s) in the previous 12 months or it HUMAN SERVICES W. Robinson, Center for Devices and did not file any MDR reports. The final Radiological Health (HFZ–530), Food rule (§ 803.57) required manufacturers Food and Drug Administration and Drug Administration, 1350 Piccard through their president, chief executive Dr., Rockville, MD 20850, 301–594– officer (C.E.O.), U.S. designated agent of 21 CFR Parts 803 and 804 2735. a foreign manufacturer, or other official most directly responsible for the firm’s [Docket No. 96N±0241] I. Background operations, to certify that they filed SUPPLEMENTARY INFORMATION: In the MDR’s for all reportable events required RIN 0910±AA09 Federal Register of December 11, 1995 under the rule for the previous 12 Medical Devices; Reporting; (60 FR 63578), FDA published a final months and a numerical summary of Certification and U.S. Designated rule (parts 803 and 807 (21 CFR parts MDR’s that they submitted, or that they Agents 803 and 807)) requiring medical device did not receive any reportable events user facilities and manufacturers to during the reporting period. AGENCY: Food and Drug Administration, report adverse events related to medical Industry representatives objected to HHS. devices under a uniform reporting the corporate status of the person ACTION: Proposed rule. system (hereinafter referred to as the required to certify, as well as the December 1995 final rule). The content of the certification statement SUMMARY: The Food and Drug December 1995 final rule was scheduled itself. Industry representatives objected Administration (FDA) is proposing to to go into effect on April 11, 1996. On to requiring the C.E.O. or president to revise its regulations for medical device April 11, 1996 (61 FR 16043), FDA certify, because, especially in a large manufacturer certification, and to issue announced that OMB had approved the company, that person may not be conforming certification requirements information collection requirements in familiar with the details of the MDR for distributors. FDA is also announcing the final rule; FDA also announced an reporting program. Industry its intent to reconsider the requirement extension of the effective date of the representatives also objected to the for foreign manufacturers to appoint a final rule to July 31, 1996. On May 28, requirement that they certify that they U.S. designated agent to perform certain 1992, a distributor adverse event filed reports for all reportable events duties under the adverse event reporting reporting rule became final. This rule during the reporting period. Industry final rule that was published in the went into effect by operation of statute representatives objected that this Federal Register of December 11, 1995. without the benefit of notice and requirement was not supported by the FDA is taking this action in response to comment. language of section 519(d) of the act and comments from industry raising After the issuance of the December objected to potential liability that may concerns that have not been addressed 1995 final rule, FDA received numerous arise from certification that all previously. Elsewhere in this issue of requests for reconsideration of the reportable events had been submitted, if the Federal Register, FDA is certification requirements and there were unintentional reporting announcing a stay of the effective date reconsideration of issues relating to U.S. mistakes. of the manufacturer certification and designated agent requirements. These In the December 1995 final rule, FDA U.S. designated agent provisions and comments led FDA to meet with the required the certification that all MDR the revocation of the May 28, 1992, Health Industry Manufacturers reportable events were filed on the basis distributor certification provisions. This Association and several industry of the statute’s legislative history. The proposed rule will assist FDA in representatives on April 19, May 23, legislative history of section 519(d) of protecting the public health by helping and June 13, 1996. During these the act states that Congress included to ensure that devices are not meetings, issues concerning industry this provision on the recommendation adulterated or misbranded and are safe burden and procedures relating to the of the General Accounting Office (GAO) and effective for their intended uses certification and U.S. designated agent as an important means of increasing the while reducing the regulatory burden on requirements were put forth that had effectiveness of the MDR system. (See H. reporting entities. not been considered previously . Rept. 808, 101st Congress, 2d sess. 23, To allow further consideration of (1990); S. Rept. 513, 101st Congress, 2d DATES: Submit written comments by these issues before implementation, sess. 26, (1990)). The GAO report noted October 7, 1996. FDA intends that any elsewhere in this issue of the Federal that certain information indicated that a final rule based on this proposal become Register, FDA is publishing a final rule third of the establishments inspected effective 75 days after publication of the staying the effective date of the were not even aware that the MDR final rule in the Federal Register. manufacturer certification and U.S. reporting requirements existed (GAO/ Submit written comments on the designated agent requirements until the PEMD–89–10, ‘‘FDA’s Implementation collection of information requirements agency issues a new final rule of the Medical Device Reporting by August 22, 1996. addressing these issues. This final rule Regulation,’’ p. 4). The GAO report ADDRESSES: Submit written comments also revokes the May 28, 1992, recommended certification to ensure to the Dockets Management Branch distributor certification provisions to that all manufacturers and importers be (HFA–305), Food and Drug provide uniform manufacturer and made aware of their obligation to submit Administration, 12420 Parklawn Dr., distributor certification requirements. MDR’s and to identify those firms that rm. 1–23, Rockville, MD 20857. were not aware of their obligation (id. at Submit written comments on the A. Section 803.57—Annual pp. 5 and 69). The legislative history of information collection requirements to Certification section 519(d) of the act also cites the the Office of Information and Regulatory Section 519(d) of the Federal Food, GAO report recommendation that the Affairs, Office of Management and Drug, and Cosmetic Act (21 U.S.C. certification state that the reporter filed Budget (OMB), New Executive Office 360i(d)) (the act) provides that each a specific number of reports and that the Bldg., 725 17th St. NW., rm. 10235, manufacturer, importer, and distributor firm received or became aware of only Washington, DC 20503, ATTN: Desk shall certify that it did file a certain these reports (H. Rept. 808, 101st Officer for FDA. number of medical device reports Congress, 2d sess. 23). Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38349

FDA believes that its regulation reports, or no reports, during the After the issuance of the December implementing the certification certification period. 1995 final rule, manufacturers who requirements was within the scope of FDA believes that this certification began to implement arrangements with the statutory authority provided in statement is a reasonable application of U.S. designated agents stated that it was section 519(d) of the act. FDA, however, the intent of section 519(d) of the act. difficult to find individuals willing to in response to the comments objecting The legislative intent is to improve take on the duties of a U.S. designated to the person required to certify and to compliance with the MDR reporting agent and that fees were high for those the content of the certification, has requirements by making responsible willing to take on the duties. reexamined the certification persons within medical device Manufacturers noted particular concern requirement and believes that the companies fully aware of the MDR about the appropriateness of a U.S. regulation may be revised in a manner reporting requirements. This intent may designated agent providing that will address the main concerns be reasonably accomplished by certifications related to MDR’s and raised about the regulation and still requiring a responsible company official premarket notification requirements meet the intent of section 519(d) of the to certify that: (1) He/she has read the because they believed that the U.S. act that will improve MDR efficiency by MDR regulation, (2) the company has designated agent may not be able to making firms aware of their reporting put in place a system to implement accurately provide such certifications. obligations under MDR. those regulations, and (3) a specified Moreover, the potential liability FDA designated in the December 1995 number of MDR reports were submitted associated with certification final rule that the certifier must be the during the previous year as a result of responsibilities greatly increased the president, C.E.O., U.S. designated agent, its implementation system. cost of U.S. designated agent services. or other official most directly Under proposed § 803.57(a), the dates In addition to the concerns discussed responsible for the firm’s operations, in of certification would remain the same previously, many other issues relating to response to a comment to the tentative as the December 1995 final rule, i.e., the the implementation and scope of U.S. final rule (56 FR 60024, November 26, date of the firm’s annual registration. designated agent requirements were FDA intends that the first certification 1991) requesting FDA to identify who raised for the first time after the statement would be due with the first should certify. FDA now believes, December 1995 final rule. After further annual registration due at least 6 however, based on subsequent internal discussions, FDA decided to months after the effective date of the comments received, that it may be stay the effective date of these final rule. For example, if the final rule appropriate for someone other than the requirements, as noted elsewhere in this were to become effective in March 1997, president or chief executive officer to issue of the Federal Register, until the first group of certifications would be sign the certification statement. FDA further notice and comment proceedings due with annual registrations due in and the issuance of a new rule. believes that the proposal suggested by September 1997 and would cover a 6- In the interim, foreign manufacturers the comments to place this particular month period. The next group of annual have a responsibility for compliance responsibility of certification with the certifications would be due in December with all medical device reporting same individual in whom the company 1997 and would cover a 9-month requirements which will not be affected has already vested overall responsibility period. Annual certifications due in by the stay of the effective date of the for implementing and overseeing its April 1998 or later would cover a 12- U.S. designated agent requirements. MDR program may be more appropriate month period. Foreign manufacturers This is because the December 1995 final than requiring certification by the would be required to submit their rule contained a significant change president or C.E.O. FDA, therefore, is certification with the annual regarding foreign manufacturers. The proposing to revise § 803.57 to provide registration, if they voluntarily register, original MDR regulation that became that the manufacturer shall designate, as or in accordance with the schedule in effective December 13, 1984, applied the certifying official, an individual § 807.21(a). only to manufacturers that were with oversight responsibilities for, and required to register under part 807. B. Section 803.58—Foreign knowledge of, the firm’s medical device Because foreign manufacturers are not Manufacturers reporting system. required to register, the 1984 rule did This proposal also provides that, Section 803.58 of the December 1995 not apply to them. The December 1995 based upon its organizational structure, final rule required that foreign final rule, however, applies to a firm may designate more than one manufacturers designate a U.S. agent to manufacturers regardless of whether certifying official, each of whom would be responsible for reporting under part they are required to register under part sign a certification statement for his or 803. U.S. designated agents were to be 807. Rather, under § 803.3(n) of the her identified organizational component responsible for: (1) Reporting to FDA in December 1995 final rule, a or site. This provision is designed to accordance with §§ 803.50, 803.52, manufacturer means any person who provide needed flexibility to large 803.53, 803.55, and 803.56; (2) manufactures, prepares, propagates, companies with more than one conducting, or obtaining from the compounds, assembles, or processes a operating division or medical device foreign manufacturer, the necessary device by chemical, physical, biological, reporting site. information regarding the investigation or other procedure. Accordingly, foreign Regarding the content of the and evaluation of the event under the manufacturers clearly fit within the certification, FDA is proposing to requirements of § 803.50; (3) certifying definition of manufacturers who are amend § 803.57 to require that the in accordance with § 803.57; (4) required to submit MDR’s under the individual certifying for the firm state forwarding MDR complaints to the December 1995 final rule. Therefore, on that: (1) He/she has read the foreign manufacturer and maintaining July 31, 1996, foreign manufacturers requirements of the MDR regulation, (2) documentation of this requirement; (5) will be fully subject to the same the firm has established a system to maintaining complaint files in requirements of part 803 applicable to implement medical device reporting; accordance with § 803.18; and (6) domestic manufacturers. This includes, and (3) following the procedures of its registering, listing, and submitting but is not limited to, the requirements medical device reporting system, the premarket notifications in accordance for written procedures (§ 803.17), MDR firm submitted a specified number of with part 807. event files (§ 803.18), individual adverse 38350 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules event reports (§§ 803.50 and 803.52), and evaluation of the event under the propose to delete these two parts of the five-day reports (§ 803.53), baseline requirements of § 803.50; (3) certifying U.S. designated agent regulations. reports (§ 803.55), and supplemental in accordance with § 803.57; (4) III. Environmental Impact reports (§ 803.56). forwarding MDR complaints to the The stayed provisions for U.S. foreign manufacturer and maintaining The agency has determined under 21 designated agents would have required documentation of this requirement; (5) CFR 25.24(a)(8) that this action is of a that these functions be performed by a maintaining complaint files in type that does not individually or U.S. designated agent on behalf of the accordance with § 803.18; and (6) cumulatively have a significant effect on foreign firm. Because FDA is staying the registering, listing, and submitting the human environment. Therefore, effective date of the U.S. designated premarket notifications in accordance neither an environmental assessment agent requirement, the full with part 807? nor an environmental impact statement responsibility for reporting is now the 2. Should FDA require a foreign is required. obligation of the foreign manufacturer. manufacturer to designate a U.S. agent IV. Analysis of Impacts Beginning July 31, 1996, foreign to fulfill the role of an ‘‘official FDA has examined the economic manufacturers are required to submit correspondent’’ with FDA regarding impact of the proposed rule under MDR reports directly to FDA (except for MDR reporting and other regulatory certification). In addition, existing Executive Order 12866 and the issues (e.g., product listing)? The intent Regulatory Flexibility Act (5 U.S.C. registration, listing, and premarket of this function would be to ensure that notification regulations, which will 22601–612). Executive Order 12866 FDA can easily contact foreign firms on directs agencies to assess all costs and remain in effect during the stay, permit MDR issues and communicate in foreign manufacturers to register benefits of available regulatory English with them, particularly on alternatives and, when regulation is (§ 807.40(a)) and submit premarket urgent public health matters. notifications (§ 807.81) and require them necessary, to select regulatory 3. Should FDA require foreign approaches that maximize net benefits to list their devices. (§ 807.40(b)). manufacturers to designate a U.S. agent FDA is reconsidering the duties of a including potential economic, for the purpose of fulfilling their U.S. designated agent. As noted in the environmental, public health and safety, substantive U.S. MDR obligations preamble to the December 1995 final and other advantages; distributive regarding complaint investigations, rule, FDA intends to issue a proposed impacts; and equity. The agency reporting, and maintenance of MDR rule to revoke the reporting believes that the proposed rule is files? The intent of this function would requirements for distributors, including consistent with the principles set out in be for FDA to be able to monitor MDR importers, (part 804 (21 CFR part 804)) the Executive Order. compliance of foreign firms without and replace them with requirements If a rule has a significant economic conducting a costly overseas inspection. consistent with the new manufacturer impact on a substantial number of small and user facility reporting requirements 4. Can either of these functions entities, the Regulatory Flexibility Act under part 803. Because importers may readily be carried out by importers, or requires agencies to analyze regulatory be able to play a role, in whole or in by other means, so that foreign options that would minimize any part, that was assigned to the U.S. manufacturers would not be required to significant impact of the rule on small designated agent in the December 1995 enter into contractual arrangements entities. The proposed rule would apply final rule, FDA believes that it would be with new entities? to all medical device manufacturers and appropriate to address the issue of U.S. 5. How can these functions be carried distributors whose devices are sold in designated agents at the same time the out efficiently by foreign manufacturers the United States. The proposed rule agency reproposes requirements for who distribute devices into the United would relieve two regulatory burdens. It distributors and importers generally. States by multiple importers, and how would allow the certification statement FDA included the U.S. designated can FDA be routinely informed of all to be signed by the person most familiar agent requirement in the December 1995 importers of a firm annually or on an as with the MDR program, not necessarily final rule in order to assure that foreign needed basis? the president or C.E.O. It also changes and domestic manufacturers are treated Notwithstanding FDA’s intent to the certification statement to minimize equally and that FDA has access to the repropose these requirements, the the possibility of liability as a result of same information it has from domestic agency has already tentatively an unintended mistake in reporting. manufacturers that will enable the concluded that it should propose that Therefore, under the Regulatory agency to protect the public health. To two aspects of the U.S. designated agent Flexibility Act, 5 U.S.C. 2605(b), the this end, FDA listed certain duties in regulations be deleted. The first is the Commissioner of Food and Drugs the December 1995 final rule that a U.S. requirement for U.S. designated agents certifies that the proposed rule, if designated agent would be required to to issue the annual certification required finalized, will not have a significant perform as described above. FDA under § 803.57. Upon reconsideration, economic impact on a substantial solicits comments on who may best FDA believes it is more appropriate for number of small entities. perform these duties and specifically the foreign manufacturer to issue this seeks comments on the following certification as proposed in this rule. V. Paperwork Reduction Act of 1995 points: The other is the requirement for foreign This proposed rule contains 1. What person is best situated to manufacturers to submit premarket information collections which are perform the following duties that, in the notifications (510(k)’s) through U.S. subject to review by OMB under the December 1995 final rule, were assigned designated agents. Although the agency Paperwork Reduction Act of 1995 (Pub. to the U.S. designated agent on behalf of had hoped this provision would help L. 104–13). The title, description, and the foreign manufacturer: (1) Reporting resolve 510(k) ownership issues respondent description of the to FDA in accordance with §§ 803.50, regarding foreign manufacturers, FDA is information collections are shown 803.52, 803.53, 803.55, and 803.56; (2) persuaded that the costs imposed by below along with an estimate of the conducting, or obtaining from the this requirement are not likely to annual record keeping and periodic foreign manufacturer the necessary outweigh the possible benefits. FDA reporting burden. Included in the information regarding the investigation solicits comment on its intent to estimate is the time for reviewing Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules 38351 instructions, searching existing data Device Amendments of 1992 (General health while also reducing the sources, gathering and maintaining the Requirements). regulatory burden on reporting entities. data needed, and completing and Description: This regulation proposes The rule amends information collection reviewing the collection of information. to amend regulations regarding device requirements which have been Title: Reporting and record keeping manufacturer and distributor reporting approved under OMB no. 0910–0059. requirements for user facilities, of deaths, serious injuries, and certain Description of Respondents: distributors, and manufacturers of malfunctions related to medical devices. Businesses or other for profit medical devices under the Safe Medical The purpose of these changes is to organizations, nonprofit organizations, Devices Act of 1990 and the Medical improve the protection of the public Federal, State, and local governments. TABLE 1.ÐESTIMATED ANNUAL REPORTING BURDEN

Annual 21 CFR Section No. of Frequency per Total Annual Hours per Total Hours Respondents Response Responses Response

803.57 12,000 1 12,000 1 12,000 804.30 8,200 1 8,200 1 8,200 Total 20,200 20,000 20,200

There are no capital or operating and technological collection techniques or § 803.1 Scope. maintenance costs expected as a result other forms of information technology, (a) This part establishes requirements of this proposal. e.g., permitting electronic submission of for medical device reporting. Under this Under OMB information collection responses. part, medical device user facilities and no. 0910–0059, which expires on As required by section 3507(d) of the manufacturers must report deaths and February 28, 1999, a total of 187,610 Paperwork Reduction Act of 1995, FDA serious injuries to which a device has or burden hours were approved for has submitted a copy of the proposed may have caused or contributed, and collection of information requirements rule amending parts 803 and 804 to manufacturers must also report certain in the December 11, 1995, final rule (60 OMB for its review of the revised device malfunctions. Additionally, user FR 63578) on medical device user information collection requirements. facilities and manufacturers must facility and manufacturer reporting, Other organizations and individuals establish and maintain adverse event certification and registration. The interested in submitting comments files, and must submit to FDA specified 12,000 burden hours reported above in regarding this burden estimate or any followup and summary reports. These Table 1 for § 803.57 were included in aspect of these information collection reports will assist FDA in protecting the that approval and therefore do not affect requirements, including suggestions for public health by helping to ensure that the total number of approved burden reducing the burden, should direct them devices are not adulterated or hours. However, the 8,200 burden hours to the Office of Information and misbranded and are safe and effective reported in Table 1 for § 804.30 have not Regulatory Affairs, OMB, New for their intended use. previously been considered in an Executive Office Bldg., 725 17th St. * * * * * information collection submission to NW., rm. 10235, Washington, DC 20503, 3. Section 803.57 is revised to read as OMB, and do represent an increase in ATTN: Desk Officer for FDA. Written follows: the burden. Therefore, this proposed comments on the information rule would add 8,200 hours to the § 803.57 Annual certification. collections should be submitted by existing approved burden and would (a) All manufacturers required to August 22, 1996. result in a proposed total annual report under this section shall submit an information collection burden of List of Subjects in 21 CFR Parts 803 and annual certification report to FDA, on 195,810 hours (187,610 + 8,200 = 804 FDA Form 3381, or electronic 195,810). equivalent as approved under § 803.14. Therefore, the agency solicits public Imports, Medical devices, Reporting The date for submission of certification comments on the revised information and record keeping requirements. coincides with the date for the firm’s collection requirements in order to: (1) Therefore, under the Federal Food, annual registration, as designated in Evaluate whether the proposed Drug, and Cosmetic Act, and under § 807.21 of this chapter. Foreign collection of information is necessary authority delegated to the Commissioner manufacturers shall submit their for the proper performance of the of Food and Drugs, it is proposed that certification by the date on which they functions of the agency, including 21 CFR parts 803 and 804 amended as would be required to register under whether the information will have follows: § 807.21 of this chapter if they were practical utility; (2) evaluate the domestic manufacturers. The accuracy of the agency’s estimate of the PART 803ÐMEDICAL DEVICE certification period will be the 12- burden of the proposed collection of REPORTING month period ending 1 month before the information, including the validity of certification date. the methodology and assumptions used; 1. The authority citation for part 803 (b) The manufacturer shall designate, (3) enhance the quality, utility, and continues to read as follows: as the certifying official, an individual clarity of the information to be Authority: Secs. 502, 510, 519, 520, 701, with oversight responsibilities for, and collected; and (4) minimize the burden 704 of the Federal Food, Drug, and Cosmetic knowledge of, the firm’s medical device of the collection of information on those Act (21 U.S.C. 352, 360, 360i, 360j, 371, 374). reporting system. A manufacturer may who are to respond, including through determine, based upon its the use of appropriate automated, 2. Section 803.1 is amended by organizational structure, that one electronic, mechanical, or other revising paragraph (a) to read as follows: individual cannot oversee or have 38352 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Proposed Rules complete knowledge of the operation of reporting site manufacturers who organizational components or the reporting system at all choose to certify centrally must identify distribution sites owned by the firm. In organizational components or the reporting sites, by registration this circumstance, the firm may manufacturing sites owned by the firm. number or FDA-assigned identification designate more than one certifying In this circumstance, the firm may number and name covered by the official (one for each component or site), designate more than one certifying certification, and provide the each of whom will sign a certification official, each of whom will sign a information required by paragraph (c)(2) statement pertaining to their respective certification statement pertaining to and (c)(3) of this section for each identified organizational component(s) their respective identified reporting site. or site(s). organizational component(s) or site(s). (c) The report shall contain the PART 804ÐMEDICAL DEVICE (c) The report shall contain the following information: following information: DISTRIBUTOR REPORTING (1) Name, address, telephone number, (1) Name, address, telephone number, 4. The authority citation for part 804 and FDA registration number or FDA- and FDA registration number or FDA continues to read as follows: assigned identification number of the assigned identification number of the reporting site and whether the firm is a Authority: Secs. 502, 510, 519, 520, 701, firm; manufacturer; 704 of the Federal Food, Drug, and Cosmetic (2) Name, title, address, telephone (2) Name, title, address, telephone Act (21 U.S.C. 352, 360, 360i, 360j, 371, 374). number, signature, and date of signature number, signature, and date of signature 5. Part 804 is amended by adding new of the person making the certification; of the person making the certification; § 804.30 to read as follows: (3) Name, address, and FDA (3) Name, address, and FDA § 804.30 Annual certification. registration number of the distributor registration number of each covered by the certification and the (a) Distributors required to report manufacturing site covered by the number of reports submitted for devices under this section shall submit an certification and the number of reports distributed by the distributor; annual certification report to FDA on submitted for devices manufactured at (4) A statement certifying that; each site; form FDA 3381, or electronic equivalent (4) A statement certifying that: as approved under § 803.14 of this (i) The individual certifying for the (i) The individual certifying for the chapter. The date for submission of firm has read the MDR requirements firm has read the MDR requirements certification coincides with the date for under part 804; under part 803; the firm’s annual registration as (ii) The firm has established a system (ii) The firm has established a system designated in § 807.21 of this chapter. to implement medical device reporting; to implement medical device reporting; This certification period will be the 12- and, and month period ending 1 month before the (iii) Following the procedures of its (iii) Following the procedures of its certification date. medical device reporting system, the medical device reporting system, the (b) The distributor shall designate, as firm submitted the specified number of reporting site submitted the specified the certifying official, an individual reports, or no reports, during the 12- number of reports, or no reports, during with oversight responsibilities for, and month certification period. the 12-month certification period. knowledge of, the firm’s medical device (d) The name of the manufacturer and reporting system. A distributor may Dated: July 16, 1996. the registration number submitted under determine, based upon its William K. Hubbard, paragraph (c)(1) of this section shall be organizational structure, that one Associate Commissioner for Policy the same as the reporting site that individual cannot oversee or have Coordination. submitted the reports required by complete knowledge of the operation of [FR Doc. 96–18701 Filed 7–19–96; 2:26 pm] §§ 803.52, 803.53 and 803.55. Multi- the reporting system at all BILLING CODE 4160±01±F i

Reader Aids Federal Register Vol. 61, No. 142 Tuesday, July 23, 1996

CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING JULY

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±523±5227 publishes separately a List of CFR Sections Affected (LSA), which aids lists parts and sections affected by documents published since the revision date of each title. Laws 3 CFR 400...... 34367, 38057 Public Laws Update Services (numbers, dates, etc.) 523±6641 718...... 37544 For additional information 523±5227 Proclamations: 719...... 37544 6907...... 35083 Presidential Documents 720...... 37544 6908...... 35587 723...... 37672 Executive orders and proclamations 523±5227 6909...... 38049 729...... 36997 The United States Government Manual 523±5227 Executive Orders: 790...... 37544 Other Services 13010...... 37347 791...... 37544 13011...... 37657 Electronic and on-line services (voice) 523±4534 793...... 37544 13012...... 38051 796...... 37544 Privacy Act Compilation 523±3187 Administrative Orders: 868...... 34714 TDD for the hearing impaired 523±5229 Presidential Determinations: 906...... 37810 No. 96±34 of June 26, 916...... 37812 ELECTRONIC BULLETIN BOARD 1996 ...... 36493 917...... 37812 No. 96±35 of June 26, 946...... 35109 Free Electronic Bulletin Board service for Public Law numbers, 1996 ...... 36495 948...... 36813 Federal Register finding aids, and list of documents on public No. 96±36 of June 28, 958...... 35592 inspection. 202±275±0920 1996 ...... 35075 989...... 36814 FAX-ON-DEMAND No. 96±37 of June 29, 997...... 35594 1996 ...... 36989 998...... 35594 You may access our Fax-On-Demand service. You only need a fax No. 96±38 of June 29, 1106...... 35596 machine and there is no charge for the service except for long 1996 ...... 36991 1230...... 35597 distance telephone charges the user may incur. The list of No. 96±39 of June 6, 1400...... 37544 documents on public inspection and the daily Federal Register’s 1996 ...... 38053 1401...... 37544 table of contents are available using this service. The document No. 96±40 of June 8, 1402...... 37544 numbers are 7050-Public Inspection list and 7051-Table of 1996 ...... 38055 1405...... 37544 Contents list. The public inspection list will be updated 1412...... 37544 immediately for documents filed on an emergency basis. 4 CFR 1413...... 37544 NOTE: YOU WILL ONLY GET A LISTING OF DOCUMENTS ON 28...... 36809 1421...... 37544 FILE AND NOT THE ACTUAL DOCUMENT. Documents on 29...... 36809 1425...... 37544 public inspection may be viewed and copied in our office located 1427...... 37544 at 800 North Capitol Street, N.W., Suite 700. The Fax-On-Demand 5 CFR 1430...... 37544 telephone number is: 301±713±6905 530...... 34713 1434...... 37544 531...... 34713 1435...... 37544 FEDERAL REGISTER PAGES AND DATES, JULY 532...... 36609 1446...... 37544 534...... 34713 1464...... 37672 33825±34366...... 1 550...... 34713 1468...... 37544 34367±34712...... 2 575...... 34713 1470...... 37544 34713±35082...... 3 581...... 34713 1477...... 37544 582...... 34713 1478...... 37544 35083±35588...... 5 630...... 34713 1479...... 37544 35589±35914...... 8 734...... 35088 1479...... 37544 35915±36276...... 9 890...... 37807 1497...... 37544 36277±36492...... 10 1001...... 36993 1498...... 37544 36493±36608...... 11 1660...... 36610 1493...... 33825 36609±36808...... 12 2634...... 35589 1703...... 37813 36809±36988...... 15 3201...... 35915 1910...... 35916 36989±37198...... 16 Ch. XXIII ...... 35085 1924...... 35916 37199±37350...... 17 Ch. XXXV ...... 36993 1941...... 35916 37351±37656...... 18 Ch. LXV ...... 36246 1943...... 35916 37657±37806...... 19 Proposed Rules: 1945...... 35916 1951...... 35916 37807±38048...... 22 890...... 35973 1955...... 35916 38057±38352...... 23 7 CFR 1962...... 35916 2...... 37544 1965...... 35916 16...... 37199 1980...... 35916 29...... 37316, 37351 Proposed Rules: 52...... 37663 20...... 38107 58...... 35589 210...... 35152 210...... 37670 220...... 35152 225...... 37670 225...... 35152 301 ...... 35102, 35107, 36811, 226...... 35152 36812 300...... 34379 ii Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Reader Aids

301...... 38017 218...... 34749 17 CFR 233...... 36260 318...... 38108 220...... 33874 249...... 37357 234...... 36260, 36452 319...... 34379 221...... 33874 280...... 36260 Proposed Rules: 250...... 34749 868...... 35687 15...... 37409 291...... 36260 327...... 34751 956...... 36827 16...... 37409 570...... 36456 502...... 38114 1005...... 37628 17...... 37409 901...... 35633 516...... 38114 1007...... 37628 18...... 37409 941...... 35958, 38014 562...... 38114 1011...... 37628 19...... 37409 563...... 38114 25 CFR 1046...... 37628 240...... 36521, 37701 565...... 38114 1240...... 34385 249...... 37701 10...... 34371 1280...... 35982 574...... 38114 211...... 35634 1962...... 37405 614...... 37230 19 CFR 212...... 35634 704...... 38117 700...... 35666 8 CFR 745...... 36663 10...... 33845 12...... 33845 Proposed Rules: 103...... 35597 14 CFR 102...... 33845, 37817 5...... 36671 212...... 36610 134...... 33845, 37678 11...... 35158 214...... 35934 1...... 34508 12...... 35163 25...... 34716 201...... 37818 217...... 35598 207...... 37818 21...... 33876 264...... 37673 29...... 33963, 36965 45...... 34399 Proposed Rules: 301...... 35111 39 ...... 33874, 34368, 34718, 152...... 34400 35122, 35126, 35127, 35936, 134...... 38119 Proposed Rules: 169...... 37417 35938, 35940, 35942, 35944, 207...... 35984 21 CFR 171...... 35167 35946, 36620, 36622, 36817, 256...... 36829 208...... 35984 14...... 36624 37199, 37202, 37675, 37814 290...... 37022 9 CFR 61...... 34508 175...... 37208 71 ...... 33843 33844, 33845, 176...... 37209 92...... 36816 26 CFR 34720, 34721, 34722, 34723, 177...... 34370, 37210 112...... 33840 301...... 37683 35307, 36283, 36284, 36285, 178...... 33846 113...... 33840 Proposed Rules: 36286, 36820, 37001, 37113, 184...... 36287 201...... 36277, 36279 1...... 35696, 36320 37204, 37205, 37352, 37677 201...... 38046 318...... 37675 31...... 36320 73...... 35623 210...... 37679 381...... 37675 91...... 34508, 36286 211...... 37679 27 CFR Proposed Rules: 95...... 37206 331...... 38046 1...... 34386 97 ...... 35623, 35624, 35626, 452...... 34726 18...... 37002 3...... 34386, 34389 37352, 37354, 37356, 37677 500...... 37680 30...... 37002 11...... 34747 119...... 35628 505...... 37680 53...... 37005 92...... 36520 121 ...... 34508, 34927, 35628, 507...... 37680 55...... 38084 93...... 36520 37222 508...... 37680 275...... 37005 94...... 35987, 36520 125...... 34508 510...... 35949, 37680 Proposed Rules: 95...... 36520 135 ...... 34508, 34927, 35628 520...... 34727 53...... 37022 96...... 36520 522 ...... 34727, 35129, 36290, 141...... 34508 28 CFR 98...... 36520 142...... 34508 37682 301...... 35990 211...... 34724 529...... 34727 42...... 34729 304...... 35990 213...... 34724 558 ...... 34727, 35949, 36291 82...... 38085 308...... 35990 Ch. III ...... 37814 570...... 37680 552...... 38042 318...... 35992 1260...... 38058 801...... 37682 571...... 38042 319...... 35157 Proposed Rules: 803...... 38346 Proposed Rules: 320...... 35990 25...... 35056, 37844 804...... 38346 16...... 37425 381...... 35157, 35990 39 ...... 34767, 35691, 35693, 807...... 38346 17...... 36679 391...... 34747 35695, 36307, 36308, 36310, Proposed Rules: 31...... 34770 106...... 36154 38 (2 documents) ...... 37964, 10 CFR 36664, 36667, 36669, 37019 71 ...... 34391, 34393, 34394, 107...... 36154 37976 51...... 37351 34395, 34396, 34397, 34398, 201...... 38047 58...... 37426 53...... 35935 34769, 35991, 36311, 36312, 331...... 38047 29 CFR 110...... 35600 36313, 36314, 36315, 36316, 803...... 38348 205...... 3511 36317, 36520, 37113, 37230, 804...... 38348 1952...... 36824 420...... 35890 37231, 37407, 37408 2509...... 33847 430...... 36974 91...... 38119 22 CFR 2520...... 33847 450...... 35890 121...... 37144, 38119 41...... 35628 2550...... 33847 463...... 35114 125...... 37144 126...... 36625 Ch. XXVI...... 34002, 36626, 784...... 36611 127...... 38119 514...... 37002 37316, 37795 1003...... 35112 129...... 37144 608...... 36820 Ch. XL ....34002, 36626, 37316, 1010...... 35085 135...... 37144, 38119 37795 1021...... 36222 23 CFR 4044...... 36968 Proposed Rules: 15 CFR 630...... 35629 Proposed Rules: 34...... 37019 902 ...... 34570, 34930, 34966, 101...... 35172 1021...... 35990 35145, 35548 24 CFR 102...... 35172 923...... 36965 0...... 36246 1910...... 37849 12 CFR Proposed Rules: 60...... 36462 1926...... 37849 324...... 33842 30...... 36318 200...... 36260 Ch. XIV ...... 34405 367...... 35115 303...... 37845 201...... 36260 1750...... 35607 922...... 33876 202...... 36260, 36452 30 CFR Proposed Rules: 203 ...... 35024, 36260, 36452, 56...... 36790 32...... 37227 16 CFR 37798 57...... 36790 205...... 37229 Proposed Rules: 206...... 35014, 36260 256...... 34730 207...... 33874 303...... 35992 221 ...... 36260, 36452, 37798 901...... 37382 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Reader Aids iii

913...... 37383 123...... 36497 269...... 33881 37716, 37717 Proposed Rules: 271...... 33881 76...... 34408, 34409 36 CFR 300 ...... 36858, 37435, 37875, 206...... 37865 48 CFR 948...... 37023 1...... 35133 37877 13...... 35133 425...... 35705 225...... 37841 31 CFR 222...... 35959 430...... 36835 231...... 36305 321...... 37196 223...... 35960 252...... 37841 41 CFR 356...... 37007 Proposed Rules: Proposed Rules: 515...... 37385 1190...... 36688 201...... 35685 219...... 37878 575...... 36627 1191...... 36688, 37964 252...... 37878 42 CFR Proposed Rules: 401...... 37032 356...... 38127 37 CFR 405...... 35307 453...... 37032 2...... 36825 413...... 37011 49 CFR 32 CFR 251...... 37213 417...... 35307 1...... 34745 66...... 38386 431...... 35307 40 ...... 37015, 37222, 37693 706 ...... 35958, 36291, 36497 38 CFR 473...... 35307 498...... 35307 192...... 35139, 36825 Proposed Rules: 1...... 33850 Proposed Rules: 193...... 36825 651...... 37865 21...... 36629 195...... 36825 Proposed Rules: 410...... 34614 33 CFR 415...... 34614 199...... 37222 1...... 33878 219...... 37222 100...... 36292 17...... 37024 43 CFR 225...... 37842 110...... 36786 233...... 33871 116...... 36786 39 CFR 1820...... 37686 3710...... 37116 235...... 33871 117...... 36786, 37211 5...... 36498 236...... 33871 Proposed Rules: 120...... 37648 7...... 36498 382...... 37222 11...... 37031 127...... 36629 10...... 36498 571 ...... 33891, 36516, 36655 4700...... 36333 128...... 37648 20...... 36500 575...... 36655 157...... 36786 3001...... 37316 44 CFR 653...... 37222 158...... 36629 654...... 37222 62...... 36513, 37687 164...... 35064 40 CFR 1150...... 36965 64...... 36514 165 ...... 35130, 35132, 37211, 9...... 33851, 34202 1300...... 35139 65 ...... 33852, 33854, 38091, 37684 52 ...... 36292, 36501, 36502, 1305...... 35141 179...... 36629 37216, 37387, 37390, 37393, 38092 67...... 33856, 38094 Proposed Rules: 181...... 36786 37833, 38086 1...... 33886 183...... 36629 55...... 34202 Proposed Rules: 8...... 33886 67...... 33882, 38129 334...... 34732 63...... 34140, 36295 192...... 34410, 34413 Proposed Rules: 70...... 34733 45 CFR 195...... 34410, 34413 117...... 35702 71...... 34202 383...... 38133 154...... 34775 79...... 36506 Proposed Rules: 391...... 38133 155...... 34775 80 ...... 35310, 35673, 35960 232...... 37236 393...... 36691 165...... 37714 81...... 37833 235...... 37236 397...... 36016 167...... 35703 180 ...... 34739, 34741, 36298, 46 CFR 571 ...... 36334, 36698, 38135, 36299, 37218, 37,395 34 CFR 257...... 34253 42...... 35963 50 CFR Proposed Rules: 261...... 34252, 37397 76...... 35138 Ch. III ...... 35548 75...... 37184 271...... 34252 108...... 36786 246...... 35548 206...... 37184 300...... 35137, 35962 110...... 36786 280...... 35548 231...... 37184 425...... 35680 111 ...... 35927, 36608, 36786 281...... 35548 235...... 27184 799...... 37685 112...... 36786 282...... 35548 369...... 27184 Proposed Rules: 113...... 36786 298...... 35548 371...... 27184 50...... 37427 161...... 36786 299...... 35548 373...... 27184 51 ...... 35994, 36112, 38250 167...... 35138 600...... 37225 375...... 27184 52 ...... 35998, 36004, 36320, 514...... 35685 622...... 34930 376...... 27184 36534, 37030, 37232, 37428, Proposed Rules: 625...... 34966 378...... 27184 37429, 37875, 38129, 38250 10...... 36543, 36608 630 ...... 34746, 35971, 37842 380...... 27184 55...... 36012 15...... 36543, 36608 638...... 34930 381...... 27184 61...... 36326 641...... 34930 47 CFR 385...... 27184 63...... 36326, 36835 642...... 34785 386...... 27184 79...... 36535 Ch. I ...... 35964 645...... 34930 387...... 27184 80...... 34775 1...... 36629 646...... 34930 388...... 27184 81 ...... 33879, 36004, 37875 20...... 33859 647...... 34930 389...... 27184 82...... 37430 22...... 34375 648...... 34966, 35142 390...... 27184 86...... 37715 24...... 33850 650...... 34966 396...... 27184 90...... 34778 36...... 34375 651...... 34966 610...... 27184 93...... 35994, 36112 61...... 36515, 36653 652...... 34966 612...... 27184 136...... 36328 64...... 36629, 36653 653...... 34930 630...... 27184 180 ...... 36329, 36331, 36689, 66...... 36654 655...... 34966 637...... 27184 37233, 37433 73 ...... 34368, 34743, 34744, 657...... 34966 658...... 27184 185...... 37233 35139, 36302, 37840 658...... 34930 660...... 27184 186...... 37233 90...... 34375 659...... 34930 661...... 27184 260...... 33881 Proposed Rules: 660 ...... 34570, 35143, 35144, 669...... 27184 261...... 33881 Ch. I ...... 34405 36662, 37843 262...... 33881 1...... 37241 661...... 34570 35 CFR 264...... 33881 73 ...... 34406, 34407, 34784, 663...... 34570 61...... 36497 268...... 33881 34785, 35705, 37241, 37715, 669...... 34930 iv Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Reader Aids

670...... 34930 679 ...... 34377, 36306, 37225, 37226, 37403, 37404, 37700, 37843, 38099 680...... 34570 681...... 34570, 35145 683...... 34570 685...... 34570 695...... 35548 697...... 34746 Proposed Rules: 17 ...... 36020, 36021, 36346, 37034 20...... 37994 229...... 37035 642...... 34785 648...... 37241, 37436 679 ...... 35174, 36702, 37041 Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Reader Aids v

comments due by 7-30-96; Personal property-- Alaska; comments due by published 7-15-96 Post bankruptcy loan 7-29-96; published 6-28- REMINDERS AGRICULTURE servicing notices; 96 The items in this list were DEPARTMENT comments due by 8-2- Georgia; comments due by editorially compiled as an aid Animal and Plant Health 96; published 7-18-96 7-29-96; published 6-27- to Federal Register users. Inspection Service COMMERCE DEPARTMENT 96 Inclusion or exclusion from Kentucky; comments due by this list has no legal Exportation and importation of National Oceanic and animals and animal Atmospheric Administration 7-29-96; published 6-28- significance. 96 products: Fishery conservation and African swine fever; disease management: Pennsylvania; comments due by 8-2-96; published RULES GOING INTO status change-- Caribbean, Gulf of Mexico, 7-16-96 EFFECT TODAY Spain; comments due by and South Atlantic 7-29-96; published 5-29- fisheries; comments due Air quality planning purposes; designation of areas: HEALTH AND HUMAN 96 by 8-2-96; published 7-3- Washington; comments due SERVICES DEPARTMENT Plant-related quarantine, 96 by 7-31-96; published 7-1- foreign: DEFENSE DEPARTMENT Food and Drug 96 Administration Fruits and vegetables; Army Department Hazardous waste: Medical devices: importation; comments Military traffic management: due by 8-1-96; published Hazardous waste Medical device user facilities Motor common carriers of 7-2-96 management system-- and manufacturers; perishable subsistence Contaminated media; adverse events reporting AGRICULTURE and bulk fuel; cargo management requirements; certification DEPARTMENT insurance requirements; requirements; comments and registration-- comments due by 7-29- Federal Crop Insurance due by 7-29-96; 96; published 6-27-96 Manufacturer certification Corporation published 4-29-96 and U.S. designated Crop insurance regulations: DEFENSE DEPARTMENT Management facilities; solid agent provisions Sugar beets; comments due Federal Acquisition Regulation waste management units effective date stayed by 7-30-96; published 5- (FAR): (SWMUs), corrective and distributor reporting 31-96 Final indirect cost rates; action; comments due by certification requirement AGRICULTURE comments due by 7-29- 7-30-96; published 5-1-96 revoked; published 7- 96; published 5-28-96 23-96 DEPARTMENT Pesticides; tolerances in food, Farm Service Agency EDUCATION DEPARTMENT animal feeds, and raw JUSTICE DEPARTMENT Program regulations: Educational research and agricultural commodities: Justice Programs Office Personal property-- improvement: Dicofol, etc.; comments due State criminal illegal alien by 7-30-96; published 5- Post bankruptcy loan Exemplary and promising States assistance program 29-96 servicing notices; programs designation; regulations; CFR part conduct standards and Pesticide chemicals; various removed; published 7-23-96 comments due by 8-2- 96; published 7-18-96 activities evaluation; tolerance actions; SOCIAL SECURITY comments due by 8-2-96; comments due by 7-29- ADMINISTRATION AGRICULTURE published 6-3-96 96; published 5-29-96 DEPARTMENT Supplemental security income: ENERGY DEPARTMENT FEDERAL Food Safety and Inspection COMMUNICATIONS Aged, blind, and disabled-- Service Federal Energy Regulatory Commission COMMISSION Social Security Meat and poultry inspection: Independence and Electric utilities (Federal Power Radio stations; table of Fee increases; comments Program Improvements Act): assignments: Act, et al.; overage due by 8-2-96; published California; comments due by 7-3-96 Capacity reservation open provisions; published 7- access transmission 7-29-96; published 6-17- 23-96 AGRICULTURE tariffs; comments due by 96 TREASURY DEPARTMENT DEPARTMENT 8-1-96; published 5-10-96 Hawaii; comments due by Rural Business-Cooperative 7-29-96; published 6-19- Alcohol, Tobacco and ENVIRONMENTAL Service 96 Firearms Bureau PROTECTION AGENCY Program regulations: New York; comments due Firearms: Air pollutants, hazardous; Personal property-- by 7-29-96; published 6- Commerce in explosives national emission standards: Post bankruptcy loan 19-96 Plastic explosives; Nonhandheld new nonroad servicing notices; South Carolina; comments Antiterrorism and phase I small spark- comments due by 8-2- due by 7-29-96; published Effective Death Penalty ignition engines, class I 96; published 7-18-96 6-20-96 Act of 1996 relating to and II; carbon monoxide plastic explosives; AGRICULTURE standard; comments due South Dakota; comments implementation; DEPARTMENT by 8-2-96; published 7-3- due by 7-29-96; published 6-20-96 published 7-23-96 Rural Housing Service 96 Wisconsin; comments due Program regulations: Air programs; fuels and fuel additives: by 7-29-96; published 6- COMMENTS DUE NEXT Personal property-- 17-96 Reformulated gasoline WEEK Post bankruptcy loan FEDERAL RESERVE servicing notices; program; alternative analytical test methods SYSTEM AGRICULTURE comments due by 8-2- 96; published 7-18-96 use; comments due by 8- Availability of funds and DEPARTMENT 2-96; published 7-3-96 collection of checks AGRICULTURE Agricultural Marketing Air quality implementation (Regulation CC): DEPARTMENT Service plans; approval and Miscellaneous amendments; Onions (sweet) grown in Rural Utilities Service promulgation; various comments due by 8-2-96; Washington and Oregon; Program regulations: States: published 6-3-96 vi Federal Register / Vol. 61, No. 142 / Tuesday, July 23, 1996 / Reader Aids

Electronic fund transfers systems and FY 1997 NATIONAL LABOR Twin Commander Aircraft (Regulation E): rates; comments due by RELATIONS BOARD Corp.; comments due by Home banking services 7-30-96; published 5-31- Procedural rules: 7-29-96; published 6-6-96 disclosure, new accounts 96 Attorneys or party Airworthiness standards: error resolution and INTERIOR DEPARTMENT representatives; Special conditions-- stored-value cards, etc.; Indian Affairs Bureau misconduct before comments due by 8-1-96; BIA rules applicability; agency; comments due by Cessna 500, 550, and published 5-2-96 comments due by 8-2-96; 8-2-96; published 6-17-96 S550 airplanes; comments due by 8-2- Loan guarantees for defense published 6-3-96 SECURITIES AND 96; published 7-3-96 production (Regulation V); Energy and minerals: EXCHANGE COMMISSION comments due by 7-29-96; Ute Indian Tribe's undivided Securities: Class E airspace; comments published 5-28-96 due by 7-29-96; published tribal assets on Uintah Executive and director Securities credit transactions 6-27-96 and Ouray Reservation, compensation disclosure; (Regulations G, T, and U); UT; management by Tribe streamlining and VOR Federal airways; comments due by 8-2-96; and Ute Distribution consolidation; comments comments due by 7-29-96; published 5-6-96 Corporation; comments due by 7-29-96; published published 6-17-96 Securities: due by 8-2-96; published 6-14-96 TRANSPORTATION Relations with dealers in 6-3-96 Indian Self-Determination and TRANSPORTATION DEPARTMENT securities under section DEPARTMENT 32, 1933 Banking Act Education Assistance Act Federal Highway (Regulation R); and program: Coast Guard Administration Federal regulatory review: miscellaneous Contracts, grants, school Motor carrier safety standards: interpretations; comments construction contracts, Lifesaving equipment; due by 8-2-96; published etc.; comments due by 8- comments due by 7-31- Practice rules for 7-3-96 2-96; published 6-3-96 96; published 5-20-96 proceedings, Land and water: investigations, and HEALTH AND HUMAN TRANSPORTATION disqualifications and SERVICES DEPARTMENT Land records and title DEPARTMENT documents; comments penalties; comments due Food and Drug Omnibus Transportation by 7-29-96; published 4- Administration due by 8-2-96; published Employee Testing Act of 6-3-96 29-96 Animal drugs, feeds, and 1991: TRANSPORTATION related products: INTERIOR DEPARTMENT Workplace drug and alcohol Fish and Wildlife Service DEPARTMENT Extralabel drug use in testing programs-- animals; comments due Migratory bird hunting: Drug and alcohol Research and Special by 7-31-96; published 5- Early-season regulations procedural rules; Programs Administration 17-96 (1996-1997); proposed update; comments due Hazardous materials: frameworks; comments by 7-29-96; published Chlorofluorocarbons and other Performance-oriented ozone-depleting substances, due by 8-1-96; published 4-29-96 7-22-96 packaging standards; final products containing or TRANSPORTATION transitional provisions; INTERIOR DEPARTMENT manufactured with; warning DEPARTMENT comments due by 8-2-96; statements; comments due Minerals Management Federal Aviation published 6-26-96 by 8-1-96; published 5-3-96 Service Administration Royalty management: TREASURY DEPARTMENT Human drugs: Airworthiness directives: Antibiotic drugs-- Royalty relief for producing Bank Secrecy Act: leases and existing leases de Havilland; comments due Clarithromycin granules Currency and foreign in deep water; comments by 7-29-96; published 7-3- for oral suspension; transactions; financial due by 7-30-96; published 96 comments due by 8-2- reporting and 5-31-96 Boeing; comments due by 96; published 7-3-96 recordkeeping INTERIOR DEPARTMENT 7-29-96; published 6-19- Current good manufacturing 96 requirements-- practice-- Surface Mining Reclamation and Enforcement Office Don Luscombe Aviation Exemptions from currency Finished pharmaceuticals; transaction reporting; Federal regulatory review: History Foundation; manufacturing, quality comments due by 7-31- comments due by 8-1- control, and Permanent program and 96; published 5-29-96 96; published 4-24-96 abandoned mine land documentation Gulfstream; comments due requirements; comments reclamation plan submissions; comments by 8-2-96; published 6-24- due by 8-1-96; 96 LIST OF PUBLIC LAWS published 5-3-96 due by 7-29-96; published 5-28-96 Israel Aircraft Industries, HEALTH AND HUMAN Permanent program and Ltd.; comments due by 7- Note: No public bills which SERVICES DEPARTMENT abandoned mine land 29-96; published 5-29-96 have become law were Health Care Financing reclamation plan McDonnell Douglas; received by the Office of the Administration submissions: comments due by 7-29- Federal Register for inclusion Medicare: West Virginia; comments 96; published 6-19-96 in today's List of Public Hospital inpatient due by 7-31-96; published SAAB; comments due by 7- Laws. prospective payment 7-16-96 30-96; published 5-31-96 Last List July 22, 1996