4–9–02 Tuesday Vol. 67 No. 68 April 9, 2002 Pages 16969–17278
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1 II Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002
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2 III
Contents Federal Register Vol. 67, No. 68
Tuesday, April 9, 2002
Agricultural Marketing Service Comptroller of the Currency PROPOSED RULES RULES Hass avocado promotion, research, and information order: Risk-based capital: Referendum procedures, 17018 Securities firms; claims, 16971–16980
Agriculture Department Customs Service See Agricultural Marketing Service NOTICES See Forest Service Customhouse broker license cancellation, suspension, etc.: See Rural Housing Service Sprint Custom House Brokerage, Inc., 17117 See Rural Utilities Service
Air Force Department Defense Department RULES See Air Force Department Wake Island Code; revision, 16997–17007 PROPOSED RULES NOTICES Federal Acquisition Regulation (FAR): Meetings: Trademarks for government products; meeting, 17277– Scientific Advisory Board; correction, 17061 17278 NOTICES Air Transportation Stabilization Board Meetings: RULES Capabilities for Domestic Response to Terrorist Attacks Air Transportation Safety and System Stabilization Act: Involving Weapons of Mass Destruction Advisory Aviation disaster relief-Air Carrier Guarantee Loan Panel, 17060 Program; administrative regulations, 17257–17261 Defense Finance and Accounting Service Board of Advisors, 17060–17061 Dependents’ Education Advisory Council, 17061 Centers for Medicare & Medicaid Services NOTICES Medicaid: Energy Department State plan amendments, reconsideration; hearings— See Federal Energy Regulatory Commission Arizona, 17072–17073 Environmental Protection Agency Children and Families Administration RULES See Refugee Resettlement Office Air quality implementation plans; approval and NOTICES promulgation; various States: Grants and cooperative agreements; availability, etc.: Kentucky, 17007–17009 Job Opportunities for Low-income Individuals Program; Hazardous waste: correction, 17073 Inorganic chemical manufacturing processes identification and listing, newly identified wastes Civil Rights Commission land disposal restrictions, etc.; correction, 17119– NOTICES 17120 Meetings; State advisory committees: PROPOSED RULES District of Columbia, Maryland, and Virginia, 17046– Water pollution control: 17047 National Pollutant Discharge Elimination System— Iowa, 17047 Cooling water intake structures at Phase II existing Minnesota, 17047 facilities; requirements, 17121–17225 Utah, 17047 NOTICES Agency information collection activities: Commerce Department Proposed collection; comment request, 17069–17071 See Foreign-Trade Zones Board See National Oceanic and Atmospheric Administration Executive Office of the President See Patent and Trademark Office See Management and Budget Office NOTICES Agency information collection activities: Submission for OMB review; comment request, 17047– Federal Aviation Administration 17048 RULES Airworthiness directives: Commodity Futures Trading Commission Airbus, 16983–16987 NOTICES Boeing, 16991–16994 Meetings: McDonnell Douglas, 16987–16991 Technology Advisory Committee, 17060 Pratt & Whitney, 16994–16997
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Federal Communications Commission NOTICES RULES Banks and bank holding companies: Common carrier services: Formations, acquisitions, and mergers, 17071 Federal-State Joint Board on Universal Servce— Carrier contributions to universal fund and manner in Federal Trade Commission which costs are recovered from customers; NOTICES correction, 17014 Prohibited trade practices: Jurisdictional separations procedures— Kryton Coatings International, Inc., et al., 17071–17072 MTS and WATS structure; joint board establishment; technical amendments, 17013–17014 Federal Transit Administration Telecommunications Act of 1996; implementation— NOTICES Pay telephone reclassification and compensation Buy America waivers: provisions; inmate calling services; petition North American Bus Industries, 17104–17105 denied, 17009 Frequency allocations and radio treaty matters: Financial Management Service 4.9 GHz band transferred from Federal government use, See Fiscal Service 17009–17013 Radio stations; table of assignments: Fiscal Service Missouri, 17014–17015 NOTICES Television broadcasting: Surety companies acceptable on Federal bonds: Digital television— Atlantic Alliance Fidelity & Surety Co., 17117–17118 Digital television broadcast signals; carriage of transmissions by cable operators; correction, 17015 Fish and Wildlife Service PROPOSED RULES NOTICES Common carrier services: Endangered and threatened species: Telecommunications Act of 1996; implementation— Recovery plans— Pay telephone reclassification and compensation Gila trout, 17089 provisions; inmate calling services, 17036–17038 Endangered and threatened species permit applications, Digital television stations; table of assignments: 17088–17089 Virginia, 17041–17042 Environmental statements; availability, etc.: Frequency allocations and radio treaty matters: Incidental take permits— 4.9 GHz band transferred from Federal government use, Baldwin County, AL; Alabama beach mouse, etc., 17038–17041 17089–17090
Federal Deposit Insurance Corporation Food and Drug Administration RULES NOTICES Risk-based capital: Human drugs: Securities firms; claims, 16971–16980 World Health Organization— Narcotic drugs; international drug scheduling; Federal Energy Regulatory Commission Psychotropic Substances Convention; comment NOTICES request, 17074–17076 Electric rate and corporate regulation filings: Meetings: Dayton Power & Light Co. et al., 17066–17068 Anthrax vaccines, efficacy testing and surrogate markers New Power Co. et al., 17068–17069 of immunity; workshop, 17076 Applications, hearings, determinations, etc.: Antimicrobial resistance; public information, 17076– ANR Pipeline Co., 17061 17077 Dominion Transmission, Inc., 17061–17062 Reports and guidance documents; availability, etc.: East Tennessee Natural Gas Co., 17062 Biological products— Gulf South Pipeline Co., LP, 17062 Nucleic acid tests use on pooled and individual Kinder Morgan Interstate Gas Transmission LLC, 17062 samples from human blood donors for transfusion National Fuel Supply Corp., 17063 to reduce risk of transmission of HIV-1 and HCV, Panhandle Eastern Pipe Line Co., 17064 Reliant Energy Gas Transmission Co., 17064 17077 Tennessee Gas Pipeline Co., 17064 Lawfully marketed cancer drugs or biological products, Texas Gas Transmission Corp., 17065–17066 studies; IND exemptions, 17078 Federal Motor Carrier Safety Administration Foreign-Trade Zones Board NOTICES NOTICES Motor carrier safety standards: Applications, hearings, determinations, etc.: Driver qualifications— Louisiana Cheely, Mark K., et al.; vision requirement exemptions, LOOP LLC/LOCAP LLC; crude oil pipeline and storage 17102–17104 system, 17048 Nebraska Federal Reserve System Kawasaki Motors Manufacturing Corp., U.S.A.; motor RULES vehicle and industrial automation products Risk-based capital: manufacturing facility, 17048 Securities firms; claims, 16971–16980 Kawasaki Motors Manufacturing Corp., U.S.A.; multi- Truth in lending (Regulation Z): axis industrial robots manufacturing facility, 17048 Official staff commentary; amendments, 16980–16983 New Mexico, 17048–17049
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Ohio National Aeronautics and Space Administration E.I. duPont de Nemours & Co., Inc.; chemical product RULES manufacturing and warehousing facilities, 17049 Acquisition regulations: Puerto Rico Safety and health solicitation provisions and contract Schering-Plough Products, L.L.C.; pharmaceutical clauses, 17016–17017 product manufacturing plant, 17049 PROPOSED RULES Texas, 17049–17050 Federal Acquisition Regulation (FAR): Trademarks for government products; meeting, 17277– Forest Service 17278 NOTICES NOTICES Agency information collection activities: Federal claims collection: Proposed collection; comment request, 17043–17044 Administrative wage garnishment Meetings: Withdrawn, 17090–17091 National Tree-marking Paint Committee, 17044 National Highway Traffic Safety Administration General Services Administration NOTICES PROPOSED RULES Motor vehicle defect proceedings; petitions, etc.: Federal Acquisition Regulation (FAR): Johnston, James J.; partial grant and partial denial, Trademarks for government products; meeting, 17277– 17105–17115 17278 Motor vehicle safety standards: Nonconforming vehicles— Health and Human Services Department Importation eligibility; determinations, 17115–17117 See Centers for Medicare & Medicaid Services See Children and Families Administration National Oceanic and Atmospheric Administration See Food and Drug Administration See Health Resources and Services Administration NOTICES See Refugee Resettlement Office Grants and cooperative agreements; availability, etc.: See Substance Abuse and Mental Health Services Education Partnership Program— Administration Minority Serving Institutions; Environmental Entrepreneurship Program, 17050–17054 Health Resources and Services Administration Meetings: NOTICES New England Fishery Management Council, 17054–17055 Grants and cooperative agreements; availability, etc.: Nursing Education Loan Repayment Program, 17078– Nuclear Regulatory Commission 17079 NOTICES Meetings; Sunshine Act, 17091 Housing and Urban Development Department NOTICES Office of Management and Budget Agency information collection activities: See Management and Budget Office Proposed collection; comment request, 17086–17088
Interior Department Patent and Trademark Office See Fish and Wildlife Service NOTICES See Land Management Bureau Meetings: Electronic public search facility plan; comment request Justice Department and hearing, 17055–17060 PROPOSED RULES National Stolen Passenger Motor Vehicle Information Pension and Welfare Benefits Administration System; implementation, 17027–17036 RULES Employee Retirement Income Security Act: Labor Department Employee pension and welfare benefit plans; See Pension and Welfare Benefits Administration recordkeeping and disclosure requirements; use of electronic media, 17263–17276 Land Management Bureau NOTICES Postal Rate Commission Meetings: NOTICES Resource Advisory Councils— Meetings: Central Montana, 17090 Consumer Advocate Office study; briefing, 17091 Management and Budget Office RULES Public Debt Bureau Air Transportation Safety and System Stabilization Act: See Fiscal Service Aviation disaster relief-Air Carrier Guarantee Loan Program; technical amendment, 17257–17258 Public Health Service See Food and Drug Administration Mississippi River Commission See Health Resources and Services Administration NOTICES See Substance Abuse and Mental Health Services Meetings; Sunshine Act, 17090 Administration
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Refugee Resettlement Office Thrift Supervision Office NOTICES RULES Grants and cooperative agreements; availability, etc.: Risk-based capital: Refugee Resettlement Program— Securities fims; claims, 16971–16980 Social services funds; State allocations, 17079–17082 PROPOSED RULES Mutual savings associations, mutual holding company Rural Housing Service reorganizations, and conversions from mutual to stock RULES form, 17227–17255 Guaranteed Rural Rental Housing Program, 16969–16971 NOTICES Transportation Department Grants and cooperative agreements; availability, etc.: See Federal Aviation Administration Community Facilities Program for rural communities See Federal Motor Carrier Safety Administration with extreme high unemployment and severe See Federal Transit Administration economic depression, 17044–17046 See National Highway Traffic Safety Administration See Surface Transportation Board Rural Utilities Service NOTICES RULES Meetings: Electric loans: Civil penalty enforcement proceedings; knowledge Insured loans; pre-loan policies and procedures— requirements for hazardous materials transportation, Municipal rate loans; interest rates schedule, 16969 17101–17102 PROPOSED RULES Electric loans: Treasury Department Useful life of facility determination, 17018–17020 See Comptroller of the Currency See Customs Service Securities and Exchange Commission See Fiscal Service NOTICES See Thrift Supervision Office Self-regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc., 17091– 17092 Separate Parts In This Issue New York Stock Exchange, Inc., 17092–17094 Pacific Exchange, Inc., 17094–17098 Part II Philadelphia Stock Exchange, Inc., 17098–17099 Environmental Protection Agency, 17121–17225
Small Business Administration Part III PROPOSED RULES Treasury Department, Thrift Supervision Office, 17227– Small business size standards: 17255 Testing laboratories, 17020–17027 NOTICES Part IV Disaster loan areas: Texas, 17099 Air Transportation Stabilization Board, 17257–17261 Intergovernmental review of agency programs and activities, 17099–17100 Part IV Meetings: Executive Office of the President, Management and Budget Regulatory Fairness Boards— Office, 17257–17258 Region III; Public Roundtable, 17100–17101 Region VII; hearing, 17101 Part V Labor Department, Pension and Welfare Benefits Substance Abuse and Mental Health Services Administration, 17263–17276 Administration NOTICES Part VI Agency information collection activities: Defense Department; General Services Administration; Proposed collection; comment request, 17082–17083 National Aeronautics and Space Administration, Grants and cooperative agreements; availability, etc.: 17277–17278 American Indian/Alaska Native and Rural Community Planning Program, 17083–17084 Community Action Grants, 17084–17085 Reader Aids Comprehensive Drug/Alcohol and Mental Health Consult the Reader Aids section at the end of this issue for Treatment Systems Development for Homeless phone numbers, online resources, finding aids, reminders, Persons Program, 17085–17086 and notice of recently enacted public laws. To subscribe to the Federal Register Table of Contents Surface Transportation Board LISTSERV electronic mailing list, go to http:// NOTICES listserv.access.gpo.gov and select Online mailing list Railroad operation, acquisition, construction, etc.: archives, FEDREGTOC-L, Join or leave the list (or change Southern Gulf Railway Co., 17117 settings); then follow the instructions.
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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.
7 CFR 1714...... 16969 3565...... 16969 Proposed Rules: 1219...... 17018 1710...... 17018 12 CFR 3...... 16971 208...... 16971 225...... 16971 226...... 16980 325...... 16971 567...... 16971 Proposed Rules: 563b...... 17230 574...... 17230 575...... 17230 13 CFR Proposed Rules: 121...... 17020 14 CFR 39 (4 documents) ...... 16983, 16987, 16991, 16994 Ch. VI...... 17258 1300...... 17258 1310...... 17258 28 CFR Proposed Rules: 89...... 17027 29 CFR 2520...... 17264 32 CFR 935...... 16997 40 CFR 52...... 17007 268...... 17119 Proposed Rules: 9...... 17122 122...... 17122 123...... 17122 124...... 17122 125...... 17122 47 CFR 1...... 17009 2...... 17009 26...... 17009 36...... 17013 54...... 17014 61...... 17009 69...... 17009 73...... 17014 76...... 17015 Proposed Rules: 1...... 17036 2...... 17038 61...... 17036 69...... 17036 73...... 17041 48 CFR 1823...... 17016 1836...... 17016 1852...... 17016 Proposed Rules: 27...... 17278 52...... 17278
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Rules and Regulations Federal Register Vol. 67, No. 68
Tuesday, April 9, 2002
This section of the FEDERAL REGISTER Web site, http://www.usda.gov/rus/ DEPARTMENT OF AGRICULTURE contains regulatory documents having general electric/. applicability and legal effect, most of which Rural Housing Service are keyed to and codified in the Code of The administrative changes being made will enable RUS to post interest Federal Regulations, which is published under 7 CFR Part 3565 50 titles pursuant to 44 U.S.C. 1510. rates for municipal rate loans on the RUS website, Electric Program RIN 0575–AC26 The Code of Federal Regulations is sold by HomePage, not later than the beginning the Superintendent of Documents. Prices of of each calendar quarter. Guaranteed Rural Rental Housing new books are listed in the first FEDERAL Program REGISTER issue of each week. This rule relates to agency procedures and, therefore, pursuant to 5 U.S.C. 553, AGENCY: Rural Housing Service, USDA. notice of proposed rule making and ACTION: Final rule. DEPARTMENT OF AGRICULTURE opportunity for comment are not required. Further, since this rule relates SUMMARY: The Rural Housing Service Rural Utilities Service to agency procedures, it is exempt from (RHS) is amending its regulations for the the provisions of Executive Order Nos. Guaranteed Rural Rental Housing 7 CFR Part 1714 Program (GRRHP). The Housing Act of 12866 and 12988. This action will not 1949, which authorizes RHS to have an effect on a substantial number Pre-Loan Policies and Procedures for administer GRRHP, was amended on of small businesses and thus, is exempt Insured Electric Loans December 27, 2000. The intended effect from the provisions of the Regulatory AGENCY: Rural Utilities Service, USDA. of this final rule change is limited to the Flexibility Act (5 U.S.C. 601 et seq.). implementation of five statutory ACTION: Final rule. List of Subjects in 7 CFR Part 1714 changes. The revisions range from adding a definition of an ‘‘Indian tribe’’ SUMMARY: This final rule revises the Electric power, Loan programs- manner in which the Rural Utilities to authorizing loans to be made for 25 energy, Rural areas. Service (RUS) notifies Borrowers of the years with an amortization of 40 years (i.e., balloon payments). schedule of interest rates for municipal For the reasons set forth in the rate loans. RUS will post the quarterly preamble, chapter XVII of title 7 of the EFFECTIVE DATE: May 9, 2002. interest rates for municipal rate loans on Code of Federal Regulations, is FOR FURTHER INFORMATION CONTACT: the RUS website at the beginning of amended as follows: Douglas H. MacDowell, Senior Loan each calendar quarter to allow for a Specialist, Multi-Family Housing quicker notification of the municipal PART 1714—GENERAL INFORMATION Processing Division, Rural Housing interest rates to RUS Borrowers. Service, U.S. Department of Agriculture, EFFECTIVE DATE: April 9, 2002. 1. The authority citation for part 1714 STOP 0781, 1400 Independence Avenue SW., Washington, DC 20250–0781, FOR FURTHER INFORMATION CONTACT: is revised to read as follows: Gail Telephone (202) 720–1604. P. Salgado, Management Analyst, Policy Authority: 7 U.S.C. 901 et seq.; 1921 et SUPPLEMENTARY INFORMATION: Analysis and Loan Management Staff, seq.; and 6941 et seq. Rural Utilities Service, U.S. Department Classification of Agriculture, STOP 1560, 1400 Subpart A—General This rule has been determined to be Independence Ave., SW., Washington, not significant for purposes of Executive DC 20250–1522. 2. Amend § 1714.5 by revising the Order 12866 and therefore has not been first sentence in paragraph (a) to read as SUPPLEMENTARY INFORMATION: The Rural reviewed by the Office of Management Utilities Service is making this change follows: and Budget (OMB). to the Electric Program’s procedure for § 1714.5 Determination of interest rates on Paperwork Reduction Act publishing interest rates for municipal municipal rate loans. rate loans to minimize the The information collection administrative burden and allow for a (a) RUS will post on the RUS website, requirements contained in this quicker notification of the municipal Electric Program HomePage, a schedule regulation have been previously interest rates to RUS Borrowers. of interest rates for municipal rate loans approved by OMB under the provisions Since formulation of procedures for at the beginning of each calendar of 44 U.S.C. chapter 35 and this municipal rate loans, RUS has quarter.* * * regulation has been assigned OMB published the interest rates for * * * * * control number 0575–0174, in municipal rate loans quarterly in the accordance with the Paperwork Federal Register, and more recently in Dated: March 13, 2002. Reduction Act of 1995. This rule does both the Federal Register and on the Hilda Gay Legg, not impose any new information RUS website. Electronic notification of Administrator, Rural Utilities Service. collection requirements from those the interest rates for municipal rate [FR Doc. 02–8546 Filed 4–8–02; 8:45 am] approved by OMB. loans allows RUS Borrowers immediate BILLING CODE 3410–15–P access to the quarterly municipal loan Civil Justice Reform interest rates. RUS municipal loan This rule has been reviewed under interest rates can be found on the RUS Executive Order 12988, Civil Justice
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Reform. In accordance with this Environmental Impact Statement (1) defining ‘‘Indian tribe’’, (2) outlining Executive Order: (1) All state and local This document has been reviewed in how to handle loan defaults on laws and regulations that are in conflict accordance with 7 CFR part 1940, reservations, (3) authorizing guaranteed with this rule will be preempted; (2) no subpart G, ‘‘Environmental Program.’’ It loans with repayment terms of not less retroactive effect will be given to this is the determination of RHS that this than 25 nor greater than 40 years, and rule; and (3) administrative proceedings action does not constitute a major (4) removes the restriction on releasing in accordance with 7 CFR part 11 must Federal action significantly affecting the borrowers from liability. be exhausted before bringing suit in quality of the human environment and Procedural Background court challenging action taken under in accordance with the National this rule. This final rule is limited to the Environmental Policy Act of 1969, Pub. implementation of the statutory changes Unfunded Mandates Reform Act L. 91–190, an Environmental Impact made on December 27, 2000. The Title II of the Unfunded Mandates Statement is not required. Agency has no discretion implementing Reform Act of 1995 (UMRA), Public Regulatory Flexibility Act these changes. Notice and public Law 104–4, establishes requirements for comment, therefore, are impractical, This rule has been reviewed with Federal agencies to assess the effects of unnecessary, and contrary to the public regard to the requirements of the their regulatory actions on state, local, interest. Regulatory Flexibility Act (5 U.S.C. and tribal governments and the private 601–612). The undersigned has List of Subjects in 7 CFR Part 3565 sector. Under section 202 of the UMRA, determined and certified by signature of RHS generally must prepare a written Banks, Conflict of interests, Credit, this document that this rule will not statement, including a cost-benefit Environmental impact statements, Fair have a significant economic impact on analysis, for proposed and final rules housing, Hearing and appeal a substantial number of small entities with ‘‘Federal mandates’’ that may procedures, Low and moderate income since this rulemaking action does not result in expenditures to state, local, or housing, Mortgages, Real property involve a new or expanded program nor tribal governments, in the aggregate, or acquisition. does it require any more action on the to the private sector, of $100 million or Therefore, chapter XXXV, title 7, part of a small business than a large more in any one year. When such a Code of Federal Regulations, part 3565 entity. statement is needed for a rule, section is amended as follows: 205 of the UMRA generally requires Background RHS to identify and consider a PART 3565—GUARANTEED RURAL GRRHP has been designed to increase RENTAL HOUSING PROGRAM reasonable number of regulatory the availability of affordable multifamily alternatives and adopt the least costly, housing in rural areas. Qualified lenders 1. The authority citation for part 3565 more cost-effective or least burdensome are authorized to originate, underwrite, continues to read as follows: alternative that achieves the objectives and close loans for multifamily housing Authority: 5 U.S.C. 301; 7 U.S.C. 1989; 42 of the rule. projects guaranteed under this program. This rule contains no Federal U.S.C. 1480. Projects may be for new construction or mandates (under the regulatory acquisition with substantial Subpart A—General Provisions provisions of title II of the UMRA) for rehabilitation of at least $15,000 per state, local, and tribal governments or 2. Section 3565.3 is amended by unit. RHS guarantees such loans upon the private sector. Therefore, this rule is adding, in alphabetical order, a review of the lender’s underwriting not subject to the requirements of definition of ‘‘Indian tribe.’’ package, appraisal report, appropriate sections 202 and 205 of the UMRA. certifications, project information, and § 3565.3 Definitions. Executive Order 13132, Federalism satisfactory completion of the * * * * * The policies contained in this rule do appropriate level of environmental Indian tribe. Any Indian tribe, band, not have any substantial direct effect on review by the Agency. Lenders are nation, or other organized group or states, on the relationship between the expected to provide servicing or community of Indians, including any national government and the states, or contract for servicing of each loan it Alaska Native village or regional or on the distribution of power and underwrites. Loans which are village corporation, as defined by or responsibilities among the various guaranteed may not exceed 90% of the established pursuant to the Alaska levels of government. Nor does this rule total development cost of a project. This Native Claims Settlement Act (43 U.S.C. impose substantial direct compliance leaves 10% of the total development 1601 et seq.), that is recognized as costs on state and local governments. cost that must be provided from other eligible for the special programs and Therefore, consultation with the states sources. The guarantee itself is then services provided by the United States is not required. limited to 90% of the loan amount. to Indians because of their status as GRRHP is a relatively new program Indians pursuant to the Indian Self- Programs Affected which was operated as a pilot program Determination and Education The affected program is listed in the by RHS in 1996 and 1997 and as a Assistance Act of 1975 (25 U.S.C. 450 et Catalog of Federal Domestic Assistance permanent program since. During the seq.); or any entity established by the under Number 10.438, section 538 Rural early stages of the program, RHS governing body of an Indian tribe, as Rental Housing Guaranteed Loans. identified barriers in the program’s described in this definition, for the authorizing statute (section 538 of the Intergovernmental Consultation purpose of financing economic Housing Act of 1949) that limited the development. For the reasons contained in the success of the program. * * * * * notice related to 7 CFR part 3015, Congress subsequently addressed subpart V this program is not subject to these barriers in the American Subpart E—Loan Requirements Executive Order 12372 which requires Homeownership and Economic Act of intergovernmental consultation with 2000 (Pub. L. 106–569). This regulation 3. Section 3565.209 is revised to read state and local officials. incorporates those statutory changes by as follows:
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§ 3565.209 Loan amortization. DEPARTMENT OF THE TREASURY institution or by securities issued or Each guaranteed loan shall be made guaranteed by the United States or other Office of the Comptroller of the OECD central governments. for a period of not less than 25 nor Currency greater than 40 years from the date the DATES: This final rule is effective on July 1, 2002. The Agencies will not object if loan was made and may provide for 12 CFR Part 3 amortization of the loan over a period of an institution wishes to apply the provisions of this final rule beginning not to exceed 40 years with a final [Docket No. 02–04] on the date it is published in the payment of the balance due at the end RIN 1557–AB14 Federal Register. of the loan term. FOR FURTHER INFORMATION CONTACT: FEDERAL RESERVE SYSTEM § 3565.214 [Removed and Reserved] OCC: Margot Schwadron, Risk Expert (202/874–5070), Capital Policy Division; 12 CFR Parts 208 and 225 4. Section 3565.214 is removed and or Ron Shimabukuro, Counsel (202/ reserved. [Regulations H and Y; Docket No. R–1085] 874–5090), Legislative and Regulatory Activities Division, Office of the Subpart I—Servicing Requirements FEDERAL DEPOSIT INSURANCE Comptroller of the Currency, 250 E CORPORATION § 3565.403 [Amended] Street, SW., Washington, DC 20219. Board: Norah Barger, Deputy 5. Section 3565.403(b)(2) is amended 12 CFR Part 325 Associate Director (202/452–2402), Barbara Bouchard, Assistant Director by removing the last sentence. RIN 3064–AC17 (202–452–3072), or John F. Connolly, Subpart J—Assignment, Conveyance, DEPARTMENT OF THE TREASURY Supervisory Financial Analyst (202/ and Claims 452–3621), Division of Banking Office of Thrift Supervision Supervision and Regulation; or Mark E. 6. Section 3565.452 is revised to read Van Der Weide, Counsel (202/452– as follows: 12 CFR Part 567 2263), Legal Division, Board of Governors of the Federal Reserve § 3565.452 Decision to liquidate. [No. 2002–5] System, 20th Street and Constitution Avenue, NW., Washington, DC 20551. (a) A decision to liquidate shall be RIN 1550–AB11 For users of Telecommunications made when it is determined that the Device for the Deaf (‘‘TDD’’) only, default cannot be cured through actions Risk-Based Capital Standards: Claims on Securities Firms contact 202/263–4869. contained in § 3565.403 of subpart I or FDIC: For supervisory issues, Stephen it has been determined that it is in the AGENCIES: Office of the Comptroller of G. Pfeifer, Examination Specialist (202/ best interest of the Agency and the the Currency, Treasury (OCC); Board of 898–8904), Accounting Section, lender to liquidate. Governors of the Federal Reserve Division of Supervision; for legal issues, (b) In the event of a default involving System (Board); Federal Deposit Leslie Sallberg, Counsel, (202/898– a loan to an Indian tribe or tribal Insurance Corporation (FDIC); and 8876), Legal Division, Federal Deposit corporation made under this section Office of Thrift Supervision, Treasury Insurance Corporation, 550 17th Street, which is secured by an interest in land (OTS). NW., Washington, DC 20429. within such tribe’s reservation (as ACTION: Final rule. OTS: David W. Riley, Project determined by the Secretary of the Manager, (202/906–6669), Supervision Interior), including a community in SUMMARY: The OCC, Board, FDIC, and Policy; Teresa A. Scott, Counsel, Alaska incorporated by the Secretary of OTS (collectively, the Agencies) are Banking and Finance (202/906–6478), the Interior pursuant to the Indian amending their respective risk-based Regulations and Legislation Division, capital standards for banks, bank Reorganization Act (25 U.S.C. 461 et Office of the Chief Counsel, Office of holding companies, and savings seq.), the lender shall only pursue Thrift Supervision, 1700 G Street, NW., associations (collectively, institutions or Washington, DC 20552. liquidation after offering to transfer the banking organizations) with regard to account to an eligible tribal member, the SUPPLEMENTARY INFORMATION: The the risk weighting of claims on, and Agencies’ risk-based capital standards tribe, or the Indian housing authority claims guaranteed by, qualifying serving the tribe. If the lender are based upon principles contained in securities firms. This rule reduces the the July 1988 agreement entitled subsequently proceeds to liquidate the risk weight applied to certain claims on, ‘‘International Convergence of Capital account, the lender shall not sell, and claims guaranteed by, qualifying Measurement and Capital Standards’’ transfer, or otherwise dispose of or securities firms incorporated in the (Basel Accord or Accord). The Basel alienate the property except to one of United States and in other countries that Accord was developed by the Basel the entities described in the preceding are members of the Organization for Committee on Banking Supervision sentence. Economic Cooperation and (Basel Committee) and endorsed by the Dated: April 3, 2002. Development (OECD) from 100 percent central bank governors of the Group of to 20 percent under the Agencies’ risk- 1 Arthur A. Garcia, Ten (G–10) countries. The Basel based capital rules. In addition, Accord provides a framework for Administrator, Rural Housing Service. consistent with the existing rules of the [FR Doc. 02–8528 Filed 4–8–02; 8:45 am] FRB and the OCC, the FDIC and OTS are 1 The G–10 countries are Belgium, Canada, BILLING CODE 3410–XV–P amending their risk-based capital France, Germany, Italy, Japan, Netherlands, standards to permit a zero percent risk Sweden, Switzerland, the United Kingdom, and the United States. The Basel Committee is comprised of weight for certain claims on qualifying representatives of the central banks and supervisory securities firms that are collateralized by authorities from the G–10 countries, Luxembourg, cash on deposit in the lending and Spain.
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assessing the capital adequacy of a bank CAD for some time. The CAD, which issue of long-term (i.e., one year or by risk weighting its assets and off- subjects EU banks and securities firms longer) unsecured debt, from a balance-sheet exposures primarily based to the same capital requirements, nationally recognized statistical rating on credit risk. applies a 20 percent risk weight to organization (rating agency) that is in The original Basel Accord imposed a claims on both banks and securities one of the three highest investment 20 percent risk weight for claims on firms. grade rating categories 7 used by the banks incorporated in the United States rating agency.8 or other OECD countries 2 and a 100 Proposed Rule Comment Analysis percent risk weight for claims on The Agencies proposed to reduce securities firms and most other from 100 percent to 20 percent the risk The Agencies received five comments. nonbanking firms. In April 1998, the weight applied to certain claims on, and Four were from banking organizations, Basel Committee amended the Basel claims guaranteed by, qualifying while one was from a securities industry Accord to lower the risk weight from securities firms under the Agencies’ trade association. 100 percent to 20 percent for claims on, risk-based capital rules.4 Under the The five commenters supported the and claims guaranteed by, securities proposal, as under the Basel Accord, proposal to apply a 20 percent risk firms incorporated in OECD countries if qualifying securities firms must be weight to claims on, or guaranteed by, such firms are subject to supervisory incorporated in an OECD country and qualifying securities firms. Two and regulatory arrangements that are subject to supervisory and regulatory commenters indicated that the rule comparable to those imposed on OECD arrangements comparable to those change would appropriately recognize banks.3 Such arrangements must imposed on OECD banks. the relatively low credit risk of claims include risk-based capital requirements With respect to securities firms on qualifying securities firms in OECD that are comparable to those applied to incorporated in the United States, the countries that are subject to supervision banks under the Accord and its proposal would have required U.S. and regulation, including a risk-based amendment to incorporate market risks. securities firms to be broker-dealers capital requirement, comparable to The term ‘‘comparable’’ is also intended registered with the Securities and supervision and regulation of banks in to require that qualifying securities Exchange Commission (SEC) to be those countries. Two commenters stated firms (but not necessarily their parent qualifying securities firms. Qualifying that adopting the rule change would organizations) be subject to consolidated U.S. securities firms also had to be create a greater degree of equality regulation and supervision with respect subject to and in compliance with the to their subsidiaries. on long-term unsecured debt issues of such a SEC’s net capital rule, and margin and subsidiary or affiliate of the securities firm, would One of the primary reasons that the other regulatory requirements not satisfy the rating criterion. Basel Committee amended the Accord applicable to registered broker-dealers. 7 The Agencies recognize that recent international was to make it consistent with the To be qualifying securities firms, the consultative papers and a rule issued by the European Union’s (EU) Capital proposal would have required securities banking agencies used the two highest investment Adequacy Directive (CAD). A number of grade rating categories to identify assets that would firms incorporated in any other OECD qualify for a 20 percent risk weight. Both the Basel European countries have followed the country to be subject to consolidated Committee’s June 1999 consultative paper entitled supervision and regulation (covering ‘‘A New Capital Adequacy Framework’’, and the 2 The OECD is an international organization of their subsidiaries, but not necessarily Committee’s January 2001 second consultative countries that are committed to market-oriented paper entitled ‘‘The New Basel Capital Accord’’, economic policies, including the promotion of their parent organizations) comparable proposed that a bank, commercial firm, or private enterprise and free market prices, liberal to that imposed on depository securitization position rated in one of the two trade policies, and the absence of exchange institutions in OECD countries. This highest investment grade rating categories would controls. For purposes of the Basel Accord, OECD includes risk-based capital requirements qualify for a 20 percent risk weight. In addition, the countries are those countries that are full members Agencies’ November 2001 final rule on recourse of the OECD or that have concluded special lending comparable to those applied to banks and direct credit substitutes provides that a 5 arrangements associated with the International under the Accord and banking securitization position rated in one of the two Monetary Fund’s General Arrangements to Borrow. organizations under the Agencies’ highest investment grade rating categories may A listing of OECD member countries is available at capital rules. qualify for a 20 percent risk weight. 66 FR 59614 www.oecdwash.org. Any OECD country that has (November 29, 2001) (Recourse Rule). rescheduled its external sovereign debt, however, Finally, for claims on a qualifying The Agencies considered a rating requirement for may not receive the preferential capital treatment securities firm to be accorded a 20 securities firms consistent with these other generally granted to OECD countries under the percent risk weight, the proposal would proposals, but decided it would be appropriate to Accord for five years after such rescheduling. have required the firm to satisfy a rating propose requiring qualifying securities firms to be 3 Prior to this 1998 amendment, the Basel Accord standard. As proposed, a qualifying rated in one of the top three rating categories of a generally permitted claims on securities firms to rating agency. In addition to meeting the rating receive a preferential risk weight only if the claims securities firm, or its parent standard, qualifying securities firms would be were covered by a qualifying guarantee or secured consolidated group, would have been subject to supervision and regulation comparable to by qualifying collateral. In general, under the required to have a long-term issuer depository institutions in OECD countries. This Agencies’ risk-based capital standards, qualifying credit rating,6 or a rating on at least one supervision distinguishes qualifying securities guarantees are limited to guarantees by central firms from other types of entities, such as governments (including U.S. government agencies), commercial firms. Further, under the current Basel U.S. government-sponsored agencies, state and 4 65 FR 76180 (Dec. 6, 2000). Accord, claims on OECD banks and securities firms local governments of the OECD-based group of 5 This standard generally would include firms receive a 20 percent risk weight without satisfying countries, multilateral lending institutions, regional engaged in securities activities in the EU that are a similar credit rating requirement. Thus, while the development banks, U.S. depository institutions, subject to the CAD. Securities firms in other OECD Agencies considered both a higher rating and certain foreign banks. Qualifying collateral is countries would need to demonstrate to institutions requirement, on the one hand, and no rating generally limited to cash on deposit in the lending and the Agencies that their supervision and requirement, on the other, the Agencies concluded bank, securities issued or guaranteed by the U.S. or regulation qualify as comparable under this rule the proposed rating requirement struck an other OECD central governments (including U.S. and the Accord. appropriate balance. government agencies), and securities issued or 6 A long-term issuer credit rating is one that 8 The Recourse Rule defined ‘‘nationally guaranteed by U.S. government-sponsored agencies, assesses a firm’s overall capacity and willingness to recognized statistical rating organization’’ as an multilateral lending institutions, or regional pay on a timely basis its unsecured financial entity recognized by the Division of Market development banks. Claims covered by a qualifying obligations. Under the proposed rule, issuer credit Regulation of the SEC as a nationally recognized guarantee or secured by qualifying collateral ratings that are assigned to a non-broker-dealer statistical rating organization for various purposes, generally are accorded a risk weight of either zero subsidiary or affiliate of the securities firm (other including the Commission’s uniform net capital percent or 20 percent. than the parent consolidated group), or debt ratings requirements for brokers and dealers.
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between U.S. institutions and non-U.S. Agencies are retaining the proposed Committee’s January 2000 consultative institutions that already apply the 1998 rating standard as a uniform way of paper. However, it is premature to adopt Basel revision for claims on securities assessing the credit risk of securities such an option in this rulemaking. The firms. firms in the United States and in other broader Basel consultative process is One of the commenters did not object OECD countries. The use of such credit addressing outstanding issues related to to the Agencies’ adoption of a rating ratings represents a market-based the adoption of such an internal ratings criterion for qualifying securities firms approach for credit assessment because approach, and the Agencies may even though it is more conservative than investors and market participants rely reconsider this position once the Basel the Basel provision. Three commenters, on such ratings in making investment process is concluded. however, opposed the adoption of a and business decisions. The Agencies In response to commenters who rating standard. First, these commenters recognize the value of the supervisory argued that the rule could force some believed that the qualifying criteria and regulatory oversight of securities securities firms to obtain unneeded requiring adequate supervision, firms in the United States and other ratings to avoid higher borrowing costs, regulation, and capital are sufficient OECD countries. However, the Agencies the Agencies have decided to accord a indicators of creditworthiness without a believe that applying a rating standard 20 percent risk weight to certain rating requirement. Specifically, SEC as a uniform credit standard for collateralized claims on qualifying supervision of broker-dealers, including securities firms both domestically and securities firms, without regard to the its net capital rule, provides a rigorous internationally is a sound prudential rating standard, provided the claims supervisory framework not warranting supplement to ensure that only claims satisfy certain specified criteria. The the additional rating requirement. on, or guaranteed by, high quality Agencies have determined that the Second, two commenters stated that securities firms are accorded a 20 requirements imposed by the market on elimination of the rating standard from percent risk weight. Because a ratings- certain collateralized transactions, the proposed U.S. rule would make it based approach increases the risk particularly reverse repurchase/ consistent with the Basel provision and sensitivity of the risk-based capital repurchase agreements and securities would eliminate the competitive framework, the Agencies also adopted lending/borrowing transactions, ensure disparity with foreign banks applying such an approach in the recently issued that such claims on qualifying securities the Basel provision. Two commenters Recourse Rule.9 In addition, the use of firms pose very low credit risk to also indicated that imposing a rating external ratings is under consideration banking organizations. These market requirement on securities firms is by the Basel Committee as part of the practices are incorporated in the inconsistent with the provision of the revisions to the Accord. prudential requirements imposed by the Agencies’ current capital rule granting a One commenter believed that claims final rule. 20 percent risk weight to claims on on a qualifying securities firm that is Under the final rule, the collateralized OECD banks without a rating unrated should be given a 20 percent portion of a claim on a qualifying requirement. Two commenters noted risk weight only if the claims are securities firm is eligible for a 20 that many high quality securities firms guaranteed by the securities firm’s percent risk weight provided that the in the United States do not issue debt parent company and the parent claim arises under a contract that: (1) Is in the public debt markets and therefore company is rated in one of the top three a reverse repurchase/repurchase do not have a credit rating from a rating investment grade rating categories. The agreement or securities lending/ agency. They contended that the parent company need not be a borrowing transaction executed using Agencies should not put such firms into qualifying securities firm. Such a standard industry documentation; (2) is the position of either obtaining ratings guarantee legally ensures that a parent collateralized by liquid and readily without a business need or being company with a high credit rating will marketable debt or equity securities; (3) disadvantaged (i.e., paying higher rates) support claims on its qualifying is marked to market daily; (4) is subject when they borrow from banking securities firm subsidiary. Accordingly, to a daily margin maintenance organizations. Another commenter the final rule allows 20 percent risk requirement under the standard argued that the Agencies should not vest weighting on a claim on an unrated industry documentation 10; and (5) can government authority in, and increase qualifying securities firm if the parent be liquidated, terminated, or accelerated institutions’ reliance on, a small group company guarantees the claim and immediately in bankruptcy or similar of private rating agencies. satisfies the rating standard. proceeding, and the security or Upon further consideration, the One commenter believed that the collateral agreement will not be stayed Agencies have decided that market Agencies should allow banking or avoided, under applicable law of the practices for certain types of organizations to rely on ratings relevant jurisdiction.11 The transactions and banking organizations’ generated by their internal ratings credit risk exposure from such systems and analytical models. These 10 The collateralized portion of the claim is the transactions do not necessitate systems and models cover a wide range portion covered by the market value of the compliance with a rating standard for collateral. Remargining of collateral should be of securities firms and are relied upon certain types of collateralized executed on a daily basis, taking into account any by banking organizations for the change in a banking organization’s exposure to the transactions. Accordingly, the Agencies counterparty under the claim in relation to the are differentiating the treatment of allocation of economic capital and for other purposes. This commenter argued market value of the collateral held in support of the uncollateralized transactions and claim. that reliance on such systems is certain types of collateralized 11 For example, a claim is exempt from the transactions satisfying designated consistent with the internal-ratings- automatic stay in bankruptcy in the United States prudential criteria. based approach that is a major focus of if it arises under a securities contract or a the potential revisions to the Basel repurchase agreement subject to section 555 or 559 Accordingly, with regard to claims on of the Bankruptcy Code, respectively (11 U.S.C. 555 qualifying securities firms that do not Accord set forth in the Basel or 559), a qualified financial contract under section meet such prudential collateralization 11(e)(8) of the Federal Deposit Insurance Act (12 9 Furthermore, consistent with the Recourse Rule, U.S.C. 1821(e)(8)), or a netting contract between criteria (or that are not otherwise if ratings are available from more than one rating financial institutions under sections 401–407 of the covered by a qualifying guarantee or agency, the lowest rating will be used to determine Federal Deposit Insurance Corporation secured by qualifying collateral), the whether the rating standard has been met. Continued
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collateralization of such a claim should the Agencies would allow banking Finally, one commenter stated that be consistent with sound industry organizations to rely on annual reports the Agencies should conduct a practice for the type of transaction, such or other confirmations of compliance comprehensive review of all of their as a securities borrowing transaction. provided by securities firms. regulations to eliminate regulations that The final rule accords such Two commenters urged the Agencies are unnecessary or outmoded, thereby collateralized claims on qualifying to extend the 20 percent risk weight to hindering the flexibility needed by securities firms a 20 percent risk weight over-the-counter (OTC) derivatives banking organizations as they adapt to (if the claims are not otherwise eligible dealers registered with the SEC. They the changing financial services industry. for a zero percent risk weight) without noted that such firms are subject to The Agencies note that the Basel risk- the need for the qualifying securities substantial regulation, supervision, and based capital framework is undergoing firm or its parent company to comply capital requirements. These include an overall review and revision to make with the rating standard of the final limits on the scope of their activities, it more risk-focused and flexible for rule. If the claim were off balance sheet, specified internal risk management the claim would continue to be banking organizations. Furthermore, the controls, recordkeeping and reporting Agencies currently conduct converted to an on-balance sheet credit obligations, and a net capital rule. equivalent amount according to each comprehensive scheduled reviews of Although these commenters recognized their regulations, including their capital Agency’s risk-based capital rules and that the oversight of OTC derivatives guidelines. then risk weighted. dealers is less rigorous than for standard One commenter contended that the broker-dealers, they contended that the In addition to the modifications rule should accord a 20 percent risk level of oversight is sufficient to support discussed previously, the final rule weight to claims on, or guaranteed by, a 20 percent risk weight for claims on states expressly that a claim (including a subsidiary of a qualifying securities such firms. One commenter also a subordinated claim) on a qualifying firm if the subsidiary is subject to the believed that a risk weight less than 100 securities firm that is an instrument same supervision and regulation as its percent should be applied to entities used by the firm to satisfy its applicable parent qualifying securities firm. subject to regulatory reporting as capital requirement will be ineligible for However, the Agencies believe that this Material Associated Persons (MAPs) the 20 percent risk weight. The approach would require extensive under the SEC’s risk assessment rules. Agencies have decided to impose this qualitative assessment of the regulation This commenter also believed that, if a restriction because banks make of subsidiaries of qualifying securities MAP voluntarily reports information subordinated loans to, and purchase firms both domestically and under the guidelines of the Derivatives internationally and, thus, is of little subordinated debt of, securities firms Policy Group, the risk weight applicable practical use in setting the risk weight that are included in the securities firms’ to claims on the MAP should be for claims. Consequently, the Agencies capital under the SEC’s net capital rule. reduced further. have not made this suggested revision to As subordinated debt, the credit risk of the proposal. The Agencies have retained their these loans is higher than on the One commenter urged the Agencies to proposed requirement that U.S. firms securities firms’ senior debt and general eliminate the reference to ‘‘other must be fully regulated registered unsecured obligations. broker-dealers as a prerequisite to being regulatory requirements’’ in the criteria The collateralization provision of the qualifying securities firms. The for qualifying U.S. securities firms. This final rule, in general, provides a 20 Agencies continue to believe that only commenter stated that the term includes percent risk weight to claims on, or regulatory requirements unrelated to claims on those firms that are subject to the SEC’s full oversight and net capital guaranteed by, qualifying securities securities firms’ financial condition and firms that are collateralized by debt and would impose a substantial compliance requirements should qualify for a capital charge that is only 20 percent of equity securities, including corporate burden on lending institutions. The debt and equity securities. The Agencies commenter believed that a banking the requirement applied to a broad array note that the current rules of the OCC organization should be able to rely on of claims on other supervised financial and the Board give a zero percent risk representations of a broker-dealer that it firms, including bank holding weight to certain claims that are meets the relevant regulatory companies. The Agencies believe that requirements. The Agencies have such oversight and supervision is collateralized by cash on deposit in the decided to revise the language of the needed to be consistent with the terms banking organization or by securities rule to require qualified U.S. securities of the revised provision of the Basel issued or guaranteed by the U.S. firms to be broker-dealers registered Accord giving a 20 percent risk weight government or its agencies or other 12 with the SEC and comply with the to claims on securities firms subject to OECD central governments. These SEC’s net capital rule, 17 CFR 240.15c3– such supervision and oversight. current rules of the OCC and the Board 1. Thus, the only requirement that Accordingly, the final rule only reduces require a positive margin of collateral to banking organizations must track is the risk weight of U.S. securities firms be maintained on such a claim on a whether a securities firm is in that are fully regulated, registered daily basis, taking into account any compliance with its net capital broker-dealers satisfying their net change in a banking organization’s requirement. This requirement should capital requirements. Furthermore, the exposure to the obligor or counterparty not be burdensome to monitor because Agencies are cognizant that claims on under the claim in relation to the market securities firms not in compliance with OTC derivatives dealers, MAPs, and value of the collateral held in support of the net capital rule must immediately other companies, with high quality the claim. Claims qualifying for a zero cease conducting business as broker- ratings, may qualify for reduced risk percent risk weight under the current dealers, which would usually be well weightings under the standardized rules of the OCC and the Board are known in the financial sector. Absent ratings-based approach currently being unaffected by this final rule giving a 20 information to the contrary, however, considered as part of the revisions to the Basel Accord. The Agencies may 12 12 CFR part 3, appendix A, 3(a)(1)(viii); 12 CFR Improvement Act of 1991 (12 U.S.C. 4401–4407), or reconsider this issue when the Basel part 208, appendix A, III.C (1); and 12 CFR part 225, the Board’s Regulation EE (12 CFR part 231). Accord is amended. appendix A, III. (C)(1).
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percent risk weight to certain claims on by, a qualifying securities firm that has OTS are modifying their risk-based qualifying securities firms.13 a long-term issuer credit rating or a capital standards to permit a zero By contrast, OTS and FDIC rules rating on at least one issue of long-term percent risk weight to be assigned to apply a 20 percent risk weight to claims unsecured debt in one of the three certain claims on qualifying securities that are collateralized by cash on highest investment-grade-rating firms collateralized by cash on deposit deposit in depository institutions or by categories from a rating agency. in a bank or securities issued or securities issued or guaranteed by OECD However, if ratings are available from guaranteed by the central governments governments.14 To ensure uniform more than one rating agency, the lowest of OECD countries (e.g., securities of the treatment of claims on qualifying rating will be used to determine U.S. Government and its agencies), as securities firms under the final rule, the whether the rating standard has been discussed previously. Finally, if the FDIC and OTS are amending their rules met. The final rule also gives a 20 banking organization is subject to the to provide a zero percent risk weight to percent risk weight to a claim on a market risk rules of the OCC, Board, or these claims.15 The FDIC and OTS are qualifying securities firm not satisfying FDIC, and the transaction is a securities reviewing whether to make further rule the rating criterion if the firm’s parent borrowing transaction, the risk-based changes to apply this risk weight to company satisfies the rating criterion capital for the transaction should be claims on other entities that are and guarantees the claim. In addition, determined according to the Interim collateralized in this manner, e.g., the final rule accords a 20 percent risk Rule on Securities Borrowing claims on borrowers that are secured by weight to a collateralized claim on, or Transactions.16 certificates of deposit. guaranteed by, a qualifying securities Regulatory Flexibility Act Final Rule firm if the claim arises under a contract that: (1) Is a reverse repurchase/ Under section 605(b) of the After careful consideration of the repurchase agreement or securities Regulatory Flexibility Act, the Agencies comments received and for the reasons lending/borrowing transaction executed certify that this rule will not have a discussed, the Agencies have decided to under standard industry documentation; significant economic impact on a adopt a final rule according a 20 percent (2) is collateralized by liquid and substantial number of small entities risk weight to certain claims on, or readily marketable debt or equity within the meaning of the Regulatory guaranteed by, certain qualifying OECD securities; (3) is marked to market daily; Flexibility Act (5 U.S.C. 601 et seq.) securities firms. Qualifying U.S. (4) is subject to a daily margin because it will not have a significant securities firms are broker-dealers that maintenance requirement under the impact on the amount of capital are registered with the Securities and standard industry documentation; and required to be held by small Exchange Commission and satisfy their (5) can be liquidated, terminated, or institutions. The rule: (1) Only covers a net capital requirements. Qualifying accelerated immediately in bankruptcy narrow category of assets, (2) decreases securities firms incorporated in other or similar proceeding, and the security the amount of capital that an institution OECD countries are those firms that are or collateral agreement will not be must hold for those assets, (3) does not subject to consolidated supervision and stayed or avoided, under applicable law significantly change the amount of total regulation comparable to that applied to of the relevant jurisdiction. capital an institution must hold, and (4) banks in such countries. Such The Agencies are adopting this rule will have a positive impact on an regulation must include risk-based giving a 20 percent risk weight to affected institution’s capital capital requirements comparable to certain claims on certain qualifying compliance. Accordingly, a regulatory those applied to banks under the Basel securities firms for several reasons. flexibility analysis is not required. Accord. With respect to OECD countries First, claims on qualifying securities Paperwork Reduction Act that are members of the European firms satisfying the criteria of the final Union, compliance with the CAD rule generally pose relatively low credit The Agencies have determined that generally satisfies this requirement. risk to banking organizations. Second, this final rule does not involve a The final rule applies a 20 percent the 100 percent risk weight applied to collection of information pursuant to risk weight to a claim on, or guaranteed claims on securities firms under the the provisions of the Paperwork Agencies’ current capital rules is more Reduction Act of 1995 (44 U.S.C. 3501, 13 Also, this final rule is in addition to, and does stringent than the 20 percent risk weight et seq.). not modify, the current rules of the Agencies that already permit a 20 percent risk weight to be permitted for claims on qualifying Use of ‘‘Plain Language’’ securities firms under the Basel Accord assigned to certain claims that are collateralized by Section 722 of the Gramm-Leach- securities issued or guaranteed by U.S. government- and the CAD. This results in a sponsored agencies, multilateral lending competitive inequity for U.S. depository Bliley Act of 1999 requires the use of institutions, or regional development banks. institutions, which would be reduced by ‘‘plain language’’ in all proposed and 14 12 CFR part 325, Appendix A, II.C and 12 CFR this final rule. final rules published after January 1, 567.6(a)(ii)(B) and (N). 2001. The Agencies invited comments 15 The Agencies note that this rule will The Riegle Community Development and on whether the proposed rule was Regulatory Improvement Act of 1994 (12 U.S.C. address collateralized transactions 4803(a)) requires the Agencies to work jointly to conducted with qualifying securities written in ‘‘plain language’’ and how to make uniform their regulations and guidelines firms where the collateral is a make the proposed rule easier to implementing common statutory or supervisory marketable security other than an U.S. understand. No commenter indicated policies. Although the current risk-based capital that the proposed rule needs to be rules of the OCC and the Board with regard to or other OECD government security. As collateralized claims that qualify for the zero noted previously, the OCC and the revised to make it easier to understand. percent risk weighting are not affected by this final Board will permit transactions that are The final rule is substantially similar to rule, the FDIC and OTS are amending their risk- collateralized by cash or an U.S. or other the proposed rule and the Agencies based capital standards to ensure that the Agencies believe the final rule is written plainly have consistency of application in how claims on OECD government security to be risk qualifying securities firms are risk-weighted when weighted according to each Agency’s and clearly. the claims are collateralized by cash on deposit in existing risk-based capital rules for the lending depository institution or by securities 16 12 CFR part 3, appendix B, 3(a)(1)(ii) (OCC); 12 issued or guaranteed by the U.S. or other OECD collateralized transactions. Furthermore, CFR part 208, appendix E, 3(a)(1)(Board); 12 CFR central governments (including U.S. government consistent with the current rules of the part 225, appendix E, 3(a)(1)(Board); and 12 CFR agencies). OCC and the Board, the FDIC and the part 325, appendix C, 3(a)(1)(FDIC).
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Executive Order 12866 Reserve System, Mortgages, Reporting Commission’s uniform net capital requirements for brokers and dealers. The Comptroller of the Currency and and recordkeeping requirements, the Director of the OTS have determined Securities. * * * * * that this final rule is not a ‘‘significant 12 CFR Part 225 Section 3. Risk Categories/Weights for On- regulatory action’’ for purposes of Balance Sheet Assets and Off-Balance Sheet Executive Order 12866. This rule Administrative practice and Items. reduces the current risk weighting procedure, Banks, banking, Federal * * * * * applied to claims on qualifying Reserve System, Holding companies, (a) * * * securities firms and will not impose Reporting and recordkeeping (2) * * * additional cost or burden on requirements, Securities. (xiii) Claims on, or guaranteed by, a institutions. 12 CFR Part 325 securities firm incorporated in an OECD country, that satisfies the following OCC and OTS—Unfunded Mandates Administrative practice and conditions: Reform Act of 1995 procedure, Banks, banking, Capital (A) If the securities firm is incorporated in the United States, then the firm must be a Section 202 of the Unfunded adequacy, Reporting and recordkeeping requirements, Savings associations, broker-dealer that is registered with the SEC Mandates Reform Act of 1995, Pub. L. and must be in compliance with the SEC’s 104–4, (Unfunded Mandates Act), State non-member banks. net capital regulation (17 CFR 240.15c3(1)). requires that an agency prepare a 12 CFR Part 567 (B) If the securities firm is incorporated in budgetary impact statement before any other OECD country, then the bank must promulgating a rule that includes a Capital, Reporting and recordkeeping be able to demonstrate that the firm is subject federal mandate that may result in the requirements, Savings associations. to consolidated supervision and regulation, expenditure by state, local, and tribal including its subsidiaries, comparable to that Office of the Comptroller of the imposed on depository institutions in OECD governments, in the aggregate, or by the Currency countries; such regulation must include risk- private sector, of $100 million or more 12 CFR Chapter I based capital standards comparable to those in any one year. If a budgetary impact applied to depository institutions under the statement is required, section 205 of the Authority and Issuance Basel Capital Accord.11a Unfunded Mandates Act also requires (C) The securities firm, whether an agency to identify and consider a For the reasons set out in the joint incorporated in the United States or another reasonable number of regulatory preamble, the Office of the Comptroller OECD country, must also have a long-term alternatives before promulgating a rule. of the Currency amends part 3 of credit rating in accordance with section As discussed in the preamble, this final chapter I of title 12 of the Code of 3(a)(2)(xiii)(C)(1) of this appendix A; a parent Federal Regulations as follows: company guarantee in accordance with rule reduces the current risk-based section 3(a)(2)(xiii)(C)(2) of this appendix A; capital charge for claims on, and claims PART 3—MINIMUM CAPITAL RATIOS; or a collateralized claim in accordance with guaranteed by, qualifying securities ISSUANCE OF DIRECTIVES section 3(a)(2)(xiii)(C)(3) of this appendix A. firms. Accordingly, the OCC and OTS Claims representing capital of a securities have determined that this rule will not 1. The authority citation for part 3 firm must be risk weighted at 100 percent in result in the expenditure by state, local, continues to read as follows: accordance with section 3(a)(4) of this and tribal governments, or by the Appendix A. Authority: 12 U.S.C. 93a, 161, 1818, (1) Credit rating. The securities firm must private sector, of $100 million or more 1828(n), 1828 note, 1831n note, 1835, 3907, in any one year. In fact, this rule will have either a long-term issuer credit rating or and 3909. a credit rating on at least one issue of long- not impose any new cost or burden on 2. In appendix A to part 3: term unsecured debt, from a NRSRO that is state, local, or tribal governments, or the A. In section 1, paragraphs (c)(19) in one of the three highest investment-grade private sector. Therefore, the OCC and through (c)(34) are redesignated as categories used by the NRSRO. If the OTS have not prepared a budgetary (c)(20) through (c)(35); securities firm has a credit rating from more impact statement or specifically B. In section 1, new paragraph (c)(19) than one NRSRO, the lowest credit rating must be used to determine the credit rating addressed the regulatory alternatives is added; considered. under this paragraph. C. In section 3, footnotes 11a and 11b (2) Parent company guarantee. The claim FDIC Assessment of Impact of Federal are redesignated as 11b and 11c; on, or guaranteed by, the securities firm must Regulation On Families D. In section 3, new paragraphs be guaranteed by the firm’s parent company, The FDIC has determined that this (a)(2)(xiii) and (a)(4)(x) are added; and and the parent company must have either a long-term issuer credit rating or a credit final rule will not affect family well E. In section 3, new footnote 11a is added. rating on at least one issue of long-term being within the meaning of section 654 unsecured debt, from a NRSRO that is in one of the Treasury and General The additions read as follows: of the three highest investment-grade Government Appropriations Act of 1999 categories used by the NRSRO. (Pub. L.105–277). Appendix A to Part 3—Risk-Based Capital (3) Collateralized claim. The claim on the Guidelines securities firm must be collateralized subject List of Subjects Section 1. Purpose, Applicability of to all of the following requirements: 12 CFR Part 3 Guidelines, and Definitions. (i) The claim must arise from a reverse repurchase/repurchase agreement or Administrative practice and * * * * * securities lending/borrowing contract (c) * * * procedure, Capital, National banks, executed using standard industry (19) Nationally recognized statistical rating Reporting and recordkeeping documentation. organization (NRSRO) means an entity requirements, Risk. recognized by the Division of Market 11a Regulation of the Securities and Exchange See Accord on International Convergence of 12 CFR Part 208 Capital Measurement and Capital Standards as Commission (or any successor Division) adopted by the Basle Committee on Banking Accounting, Agriculture, Banks, (Commission or SEC) as a nationally Regulations and Supervisory Practices (renamed as banking, Confidential business recognized statistical rating organization for the Basel Committee on Banking Supervision), information, Crime, Currency, Federal various purposes, including the dated July 1988 (amended 1998).
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(ii) The collateral must consist of debt or c. In section III.C.4.b., a new sentence avoided, under applicable law of the relevant equity securities that are liquid and readily is added at the end of the paragraph; jurisdiction.40 marketable. and * * * * * (iii) The claim and collateral must be 4. * * * marked-to-market daily. d. In Attachment III, under Category 2, new paragraphs 12 and 13 are added. b. * * * This category also includes claims (iv) The claim must be subject to daily representing capital of a qualifying securities margin maintenance requirements under The revision and additions read as firm. standard industry documentation. follows: (v) The contract from which the claim * * * * * Appendix A to Part 208—Capital arises can be liquidated, terminated, or Attachment III—Summary of Risk Weights accelerated immediately in bankruptcy or Adequacy Guidelines for State Member and Risk Categories for State Member Banks similar proceedings, and the security or Banks: Risk-Based Measure collateral agreement will not be stayed or * * * * * avoided under the applicable law of the * * * * * Category 2: 20 Percent * * * relevant jurisdiction. To be exempt from the III. * * * 12. Claims on, and claims guaranteed by, automatic stay in bankruptcy in the United C. * * * States, the claim must arise from a securities qualifying securities firms incorporated in contract or a repurchase agreement under 2. * * * the United States or other member of the OECD-based group of countries provided section 555 or 559, respectively, of the d. This category also includes claims 38 on, that: Bankruptcy Code (11 U.S.C. 555 or 559), a or guaranteed by, a qualifying securities firm a. The qualifying securities firm has a qualified financial contract under section incorporated in the United States or other rating in one of the top three investment 11(e)(8) of the Federal Deposit Insurance Act member of the OECD-based group of grade rating categories from a nationally (12 U.S.C. 1821(e)(8)), or a netting contract countries 39 provided that: The qualifying recognized statistical rating organization; or between or among financial institutions securities firm has a long-term issuer credit b. The claim is guaranteed by a qualifying under sections 401–407 of the Federal rating, or a rating on at least one issue of securities firm’s parent company with such a Deposit Insurance Corporation Improvement long-term debt, in one of the three highest rating. Act of 1991 (912 U.S.C. 4407), or the investment grade rating categories from a 13. Certain collateralized claims on Regulation EE (12 CFR part 231). nationally recognized statistical rating qualifying securities firms in the United * * * * * organization; or the claim is guaranteed by States or other member of the OECD-based (4) * * * the firm’s parent company and the parent group of countries, without regard to (x) Claims representing capital of a company has such a rating. If ratings are satisfaction of the rating standard, provided securities firm notwithstanding section available from more than one rating agency, that the claim arises under a contract that: 3(a)(2)(xiii) of this appendix A. the lowest rating will be used to determine a. Is a reverse repurchase/repurchase whether the rating requirement has been met. * * * * * agreement or securities lending/borrowing This category also includes a collateralized transaction executed using standard industry Dated: March 25, 2002. claim on a qualifying securities firm in such documentation; John D. Hawke, Jr., a country, without regard to satisfaction of b. Is collateralized by liquid and readily Comptroller of the Currency. the rating standard, provided that the claim marketable debt or equity securities; arises under a contract that: c. Is marked to market daily; Federal Reserve System (1) Is a reverse repurchase/repurchase d. Is subject to a daily margin maintenance agreement or securities lending/borrowing 12 CFR Chapter II requirement under the standard industry transaction executed using standard industry documentation; and For the reasons set forth in the joint documentation; e. Can be liquidated, terminated, or preamble, parts 208 and 225 of chapter (2) Is collateralized by debt or equity accelerated immediately in bankruptcy or securities that are liquid and readily II of title 12 of the Code of Federal similar proceeding, and the security or marketable; Regulations are amended as follows: collateral agreement will not be stayed or (3) Is marked-to-market daily; avoided, under applicable law of the relevant (4) Is subject to a daily margin maintenance PART 208—MEMBERSHIP OF STATE jurisdiction. BANKING INSTITUTIONS IN THE requirement under the standard industry FEDERAL RESERVE SYSTEM documentation; and * * * * * (REGULATION H) (5) Can be liquidated, terminated, or accelerated immediately in bankruptcy or PART 225—BANK HOLDING 1. The authority citation for part 208 similar proceeding, and the security or COMPANIES AND CHANGE IN BANK continues to read as follows: collateral agreement will not be stayed or CONTROL (REGULATION Y) Authority: 12 U.S.C. 24, 36, 92a, 93a, 1. The authority citation for part 225 38 Claims on a qualifying securities firm that are 248(a), 248(c), 321–338a, 371d, 461, 481–486, continues to read as follows: 601, 611, 1814, 1816, 1818, 1820(d)(9), instruments the firm, or its parent company, uses 1823(j), 1828(o), 1831, 1831o, 1831p–1, to satisfy its applicable capital requirements are not Authority: 12 U.S.C. 1817(j)(13), 1818, eligible for this risk weight. 1831r–1, 1835(a), 1882, 2901–2907, 3105, 1828(o), 1831i, 1831p-1, 1843(c)(8), 1844(b), 39 With regard to securities firms incorporated in 3310, 3331–3351, and 3906–3909; 15 U.S.C. 1972(1), 3106, 3108, 3310, 3331–3351, 3907, the United States, qualifying securities firms are and 3909. 78b, 78l(b), 781(g), 781(i), 78o–4(c)(5), 78q, those securities firms that are broker-dealers 78q–1, and 78w; 31 U.S.C. 5318; 42 U.S.C. registered with the Securities and Exchange 2. In appendix A to part 225, the 4012a, 4104a, 4104b, 4106, and 4128. Commission (SEC) and are in compliance with the SEC’s net capital rule, 17 CFR 240.15c3–1. With following amendments are made: 2. In appendix A to part 208, the regard to securities firms incorporated in any other following amendments are made: country in the OECD-based group of countries, 40 For example, a claim is exempt from the a. In sections III. and IV., footnotes 38 qualifying securities firms are those securities firms automatic stay in bankruptcy in the United States through 54 are redesignated as footnotes that a bank is able to demonstrate are subject to if it arises under a securities contract or a consolidated supervision and regulation (covering repurchase agreement subject to section 555 or 559 41 through 57; their direct and indirect subsidiaries, but not of the Bankruptcy Code, respectively (11 U.S.C. 555 b. In section III.C.2. under the title necessarily their parent organizations) comparable or 559), a qualified financial contract under section Category 2: 20 percent, the three to that imposed on banks in OECD countries. Such 11(e)(8) of the Federal Deposit Insurance Act (12 existing paragraphs are designated as regulation must include risk-based capital U.S.C. 1821(e)(8)), or a netting contract between requirements comparable to those applied to banks financial institutions under sections 401–407 of the 2.a. through 2.c., and a new paragraph under the Accord on International Convergence of Federal Deposit Insurance Corporation 2.d. is added with new footnotes 38, 39, Capital Measurement and Capital Standards (1988, Improvement Act of 1991 (12 U.S.C. 4401–4407), or and 40; as amended in 1998) (Basel Accord). the Board’s Regulation EE (12 CFR Part 231).
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a. In sections III. and IV., footnotes 42 (2) Is collateralized by debt or equity 4. * * * This category also includes claims through 58 are redesignated as footnotes securities that are liquid and readily representing capital of a qualifying securities 45 through 61; marketable; firm. b. In section III.C.2. under the title (3) Is marked-to-market daily; * * * * * Category 2: 20 percent, the three (4) Is subject to a daily margin maintenance requirement under the standard industry By order of the Board of Governors of the existing paragraphs are designated as Federal Reserve System, March 27, 2002. documentation; and 2.a. through 2.c., and a new paragraph Jennifer J. Johnson, 2.d. is added with new footnotes 42, 43, (5) Can be liquidated, terminated, or accelerated immediately in bankruptcy or Secretary of the Board. and 44; similar proceeding, and the security or Federal Deposit Insurance Corporation c. In section III.C.4.b., a new sentence collateral agreement will not be stayed or is added at the end of the paragraph; avoided, under applicable law of the relevant 12 CFR Chapter III and jurisdiction. 44 d. In Attachment III, under Category For the reasons set forth in the joint 2, new paragraphs 12 and 13 are added. * * * * * preamble, part 325 of chapter III of title The revision and additions read as 4. * * * 12 of the Code of Federal Regulations is b.* * * This category also includes claims follows: amended as follows: representing capital of a qualifying securities Appendix A to Part 225—Capital firm. PART 325—CAPITAL MAINTENANCE Adequacy Guidelines for Bank Holding * * * * * Companies: Risk-Based Measure 1. The authority citation for part 325 Attachment III—Summary of Risk Weights continues to read as follows: * * * * * and Risk Categories for Bank Holding III. * * * Companies Authority: 12 U.S.C. 1815(a), 1815(b), 1816, 1818(a), 1818(b), 1818(c), 1818(t), 1819 C. * * * * * * * * 2. * * * (Tenth), 1828(c), 1828(d), 1828(i), 1828(n), Category 2: 20 Percent * * * 1828(o), 1831o, 1835, 3907, 3909, 4808; Pub. d. This category also includes claims 42 on, 12. Claims on, and claims guaranteed by, L. 102–233, 105 Stat. 1761, 1789, 1790 (12 U.S.C. 1831n note); Pub. L. 102–242, 105 or guaranteed by, a qualifying securities qualifying securities firms incorporated in 43 Stat. 2236, 2355, as amended by Pub. L. 103– firm incorporated in the United States or the United States or other member of the 325, 108 Stat. 2160, 2233 (12 U.S.C. 1828 other member of the OECD-based group of OECD-based group of countries provided note); Pub. L. 102–242, 105 Stat. 2236, 2386, countries provided that: the qualifying that: securities firm has a long-term issuer credit as amended by Pub. L. 102–550, 106 Stat. a. The qualifying securities firm has a 3672, 4089 (12 U.S.C. 1828 note). rating, or a rating on at least one issue of rating in one of the top three investment long-term debt, in one of the three highest grade rating categories from a nationally 2. In appendix A to part 325: investment grade rating categories from a recognized statistical rating organization; or a. In section II.B.3., the phrase ‘‘U.S. nationally recognized statistical rating b. The claim is guaranteed by a qualifying depository institutions and foreign organization; or the claim is guaranteed by securities firm’s parent company with such a banks’’ is removed and the phrase ‘‘U.S. the firm’s parent company and the parent rating. depository institutions, foreign banks, company has such a rating. If ratings are 13. Certain collateralized claims on and qualifying OECD-based securities available from more than one rating agency, the lowest rating will be used to determine qualifying securities firms in the United firms’’ is added in its place; whether the rating requirement has been met. States or other member of the OECD-based b. Redesignate footnotes 27 through This category also includes collateralized group of countries, without regard to 47 as footnotes 30 through 50; claims on, or guaranteed by, a qualifying satisfaction of the rating standard, provided c. Add new footnotes 27 through 29; securities firm in such a country, without that the claim arises under a contract that: d. In section II.C., under Category 1— regard to satisfaction of the rating standard, a. Is a reverse repurchase/ repurchase Zero Percent Risk Weight, add a new provided the claim arises under a contract agreement or securities lending/borrowing paragraph to follow the existing two that: transaction executed under standard industry paragraphs, and redesignate these three (1) Is a reverse repurchase/repurchase documentation; paragraphs as paragraphs a. through c. b. Is collateralized by liquid and readily agreement or securities lending/borrowing e. In section II.C., under Category 2— marketable debt or equity securities; transaction executed under standard industry 20 Percent Risk Weight, amend documentation; c. Is marked to market daily; d. Is subject to a daily margin maintenance paragraph a. by adding three new 42 Claims on a qualifying securities firm that are requirement under the standard industry sentences and paragraphs (1) through instruments the firm, or its parent company, uses documentation; and (5); to satisfy its applicable capital requirement are not e. Can be liquidated, terminated, or f. In section II.C., under Category 4— eligible for this risk weight. accelerated immediately in bankruptcy or 100 Percent Risk Weight, add a new 43 With regard to securities firms incorporated in similar proceeding, and the security or paragraph (b)(12); the United States, qualifying securities firms are collateral agreement will not be stayed or those securities firms that are broker-dealers g. In Table II, add a new paragraph (7) registered with the Securities and Exchange avoided, under applicable law of the relevant under Category 1—Zero Percent Risk Commission and are in compliance with the SEC’s jurisdiction. Weight, and net capital rule, 17 CFR 240.15c3–1. With regard to * * * * * h. In Table II, add new paragraphs securities firms incorporated in other countries in the OECD-based group of countries, qualifying (13) and (14) under Category 2—20 securities firms are those securities firms that a 44 For example, a claim is exempt from the Percent Risk Weight. banking organization is able to demonstrate are automatic stay in bankruptcy in the United States subject to consolidated supervision and regulation if it arises under a securities contract or repurchase Appendix A to Part 325—Statement of (covering their direct and indirect subsidiaries, but agreement subject to section 555 or 559 of the Policy on Risk-Based Capital not necessarily their parent organizations) Bankruptcy Code, respectively (11 U.S.C. 555 or comparable to that imposed on banks in OECD 559), a qualified financial contract under section * * * * * countries. Such regulation must include risk-based 11(e)(8) of the Federal Deposit Insurance Act (12 II. * * * capital requirements comparable to those applied to U.S.C. 1821(e)(8)), or a netting contract between C. * * * banks under the Accord on International financial institutions under sections 401–407 of the Category 1—Zero Percent Risk Weight Convergence of Capital Measurement and Capital Federal Deposit Insurance Corporation Standards (1988, as amended in 1998) (Basel Improvement Act of 1991 (12 U.S.C. 4401–4407), or c. This category also includes claims on, Accord). the Board’s Regulation EE (12 CFR Part 231). and claims guaranteed by, qualifying
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securities firms incorporated in the United (2) Is collateralized by debt or equity a. Is a reverse repurchase/repurchase States or other members of the OECD-based securities that are liquid and readily agreement or securities lending/borrowing group of countries that are collateralized by marketable; transaction executed under standard industry cash on deposit in the lending bank or by (3) Is marked-to-market daily; documentation; securities issued or guaranteed by the United (4) Is subject to a daily margin maintenance b. Is collateralized by liquid and readily States or OECD central governments requirement under the standardized marketable debt or equity securities; (including U.S. government agencies), documentation; and c. Is marked to market daily; provided that a positive margin of collateral (5) Can be liquidated, terminated, or d. Is subject to a daily margin maintenance is required to be maintained on such a claim accelerated immediately in bankruptcy or requirement under the standard on a daily basis, taking into account any similar proceeding, and the security or documentation; and change in a bank’s exposure to the obligor or collateral agreement will not be stayed or e. Can be liquidated, terminated, or counterparty under the claim in relation to avoided, under applicable law of the relevant accelerated immediately in bankruptcy or the market value of the collateral held in jurisdiction. 29 similar proceeding, and the security or support of the claim. * * * * * collateral agreement will not be stayed or Category 2—20 Percent Risk Weight avoided, under applicable law of the relevant Category 4—100 Percent Risk Weight a. * * * This category also includes a country. claim 27 on, or guaranteed by, qualifying (b) * * * * * * * * securities firms incorporated in the United (12) Claims representing capital of a By order of the Board of Directors. States or other member of the OECD-based qualifying securities firm. group of countries 28 provided that: the * * * * * Dated at Washington, DC, this 29th day of qualifying securities firm has a long-term January, 2002. issuer credit rating, or a rating on at least one Table II—Summary of Risk Weights and Federal Deposit Insurance Corporation. Risk Categories issue of long-term debt, in one of the three Robert E. Feldman, highest investment grade rating categories * * * * * Executive Secretary. from a nationally recognized statistical rating Category 1—Zero Percent Risk Weight organization; or the claim is guaranteed by Office of Thrift Supervision the firm’s parent company and the parent * * * * * company has such a rating. If ratings are (7) Claims on, or guaranteed by, qualifying 12 CFR Chapter V available from more than one rating agency, securities firms incorporated in the United the lowest rating will be used to determine States or other members of the OECD-based For the reasons set forth in the joint whether the rating requirement has been met. group of countries that are collateralized by preamble, the Office of Thrift This category also includes a collateralized cash on deposit in the lending bank or by Supervision amends part 567 of chapter claim on a qualifying securities firm in such securities issued or guaranteed by the United V of title 12 of the Code of Federal a country, without regard to satisfaction of States or OECD central governments Regulations as follows: the rating standard, provided that the claim (including U.S. government agencies), arises under a contract that: provided that a positive margin of collateral PART 567—CAPITAL (1) Is a reverse repurchase/repurchase is required to be maintained on such a claim agreement or securities lending/borrowing on a daily basis, taking into account any 1. The authority citation for part 567 transaction executed using standard industry change in a bank’s exposure to the obligor or continues to read as follows: documentation; counterparty under the claim in relation to Authority: 12 U.S.C. 1462, 1462a, 1463, the market value of the collateral held in 1464, 1467a, 1828 (note). 27 Claims on a qualifying securities firm that are support of the claim. instruments the firm, or its parent company, uses 2. Section 567.1 is amended by to satisfy its applicable capital requirements are not * * * * * adding the definition of qualified eligible for this risk weight. Category 2—20 Percent Risk Weight securities firm to read as follows: 28 With regard to securities firms incorporated in * * * * * the United States, qualifying securities firms are § 567.1 Definitions. those securities firms that are broker-dealers (13) Claims on, and claims guaranteed by, registered with the Securities and Exchange qualifying securities firms incorporated in * * * * * Commission (SEC) and are in compliance with the the United States or other member of the Qualifying securities firm. The term SEC’s net capital rule, 17 CFR 240.15c3–1. With OECD-based group of countries provided qualifying securities firm means: (1) A regard to securities firms incorporated in any other that: securities firm incorporated in the country in the OECD-based group of countries, a. The qualifying securities firm has a qualifying securities firms are those securities firms United States that is a broker-dealer that that a bank is able to demonstrate are subject to rating in one of the top three investment is registered with the Securities and grade rating categories from a nationally consolidated supervision and regulation (covering Exchange Commission (SEC) and that their direct and indirect subsidiaries, but not recognized statistical rating organization; or necessarily their parent organizations) comparable b. The claim is guaranteed by a qualifying complies with the SEC’s net capital to that imposed on banks in OECD countries. Such securities firm’s parent company with such a regulations (17 CFR 240.15c3(1)); and regulation must include risk-based capital rating. (2) A securities firm incorporated in requirements comparable to those applied to banks under the Accord on International Convergence of (14) Certain collateralized claims on any other OECD-based country, if the Capital Measurement and Capital Standards (1988, qualifying securities firms in the United savings association is able to as amended in 1998) (Basel Accord). Claims on a States or other member of the OECD-based demonstrate that the securities firm is qualifying securities firm that are instruments the group of countries, without regard to subject to consolidated supervision and firm, or its parent company, uses to satisfy its satisfaction of the rating standard, provided regulation (covering its subsidiaries, but applicable capital requirements are not eligible for that the claim arises under a contract that: this risk weight and are generally assigned to at not necessarily its parent organizations) least a 100 percent risk weight. In addition, certain comparable to that imposed on claims on qualifying securities firms are eligible for 29 For example, a claim is exempt from the a zero percent risk weight if the claims are automatic stay in bankruptcy in the United States depository institutions in OECD collateralized by cash on deposit in the lending if it arises under a securities contract or a countries. Such regulation must include bank or by securities issued or guaranteed by the repurchase agreement subject to section 555 or 559 risk-based capital requirements United States or OECD central governments of the Bankruptcy Code, respectively (11 U.S.C. 555 comparable to those imposed on (including U.S. government agencies), provided that or 559), a qualified financial contract under section a positive margin of collateral is required to be 11(e)(8) of the Federal Deposit Insurance Act (12 depository institutions under the maintained on such a claim on a daily basis, taking U.S.C. 1821(e)(8)), or a netting contract between Accord on International Convergence of into account any change in a bank’s exposure to the financial institutions under sections 401–407 of the Capital Measurement and Capital obligor or counterparty under the claim in relation Federal Deposit Insurance Corporation Standards (1988, as amended in 1998). to the market value of the collateral held in support Improvement Act of 1991 (12 U.S.C. 4401–4407), or of the claim. the Board’s Regulation EE (12 CFR part 231). * * * * *
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3. Section 567.6 is amended by automatic stay in bankruptcy in the Consumer and Community Affairs, adding paragraphs (a)(1)(i)(H) and United States if it arises under a Board of Governors of the Federal (a)(1)(ii)(H) to read as follows: securities contract or a repurchase Reserve System, at (202) 452–3667 or agreement subject to section 555 or 559 452–2412; for users of § 567.6 Risk-based capital credit risk- of the Bankruptcy Code (11 U.S.C. 555 Telecommunications Device for the Deaf weight categories. or 559), a qualified financial contract (‘‘TDD’’) only, contact (202) 263–4869. (a) * * * under section 11(e)(8) of the Federal SUPPLEMENTARY INFORMATION: (1) * * * Deposit Insurance Act (12 U.S.C. (i) * * * 1821(e)(8)), or a netting contract I. Background (H) Claims on, and claims guaranteed between or among financial institutions The purpose of the Truth in Lending by, a qualifying securities firm that are under sections 401–407 of the Federal Act (TILA), 15 U.S.C. 1601 et seq., is to collateralized by cash on deposit in the Deposit Insurance Corporation promote the informed use of consumer savings association or by securities Improvement Act of 1991 (12 U.S.C. credit by providing for disclosures about issued or guaranteed by the United 4401–4407), or Regulation EE (12 CFR its terms and cost. The act requires States Government or its agencies, or the part 231). creditors to disclose the cost of credit as central government of an OECD country. (3) If the securities firm uses the claim a dollar amount (the finance charge) and To be eligible for this risk weight, the to satisfy its applicable capital as an annual percentage rate. Uniformity savings association must maintain a requirements, the claim is not eligible in creditors’ disclosures is intended to positive margin of collateral on the for a risk weight under this paragraph assist consumers in comparison claim on a daily basis, taking into (a)(1)(ii)(H); shopping for credit. TILA requires account any change in a savings * * * * * additional disclosures for loans secured association’s exposure to the obligor or by consumers’ homes and permits counterparty under the claim in relation Dated: February 1, 2002. consumers to rescind certain to the market value of the collateral held By the Office of Thrift Supervision. transactions that involve their principal in support of the claim. James E. Gilleran, dwelling. In addition, the act regulates (ii) * * * Director. certain practices of creditors. (H) Claims on, and claims guaranteed [FR Doc. 02–8142 Filed 4–8–02; 8:45 am] TILA is implemented by the Board’s by, a qualifying securities firm, subject BILLING CODE 6210–01–P Regulation Z (12 CFR part 226). The to the following conditions: Board’s official staff commentary (12 (1) A qualifying securities firm must CFR part 226 (Supp. I)) interprets the have a long-term issuer credit rating, or FEDERAL RESERVE SYSTEM regulation, and provides guidance to a rating on at least one issue of long- creditors in applying the regulation to term unsecured debt, from a NRSRO. 12 CFR Part 226 specific transactions. Good faith The rating must be in one of the three compliance with the commentary highest investment grade categories [Regulation Z; Docket No. R–1118] affords protection from liability under used by the NRSRO. If two or more section 130(f) of TILA (15 U.S.C. Truth in Lending NRSROs assign ratings to the qualifying 1640(f)). The commentary is a substitute securities firm, the savings association AGENCY: Board of Governors of the for individual staff interpretations; it is must use the lowest rating to determine Federal Reserve System. updated periodically to address whether the rating requirement of this ACTION: Final rule; official staff significant questions that arise. paragraph is met. A qualifying securities In December 2001, the Board interpretation. firm may rely on the rating of its parent published for comment proposed consolidated company, if the parent SUMMARY: The Board is publishing changes to the commentary (66 FR consolidated company guarantees the revisions to the official staff 64381, December 13, 2001). The Board claim. commentary to Regulation Z, which received approximately 50 comment (2) A collateralized claim on a implements the Truth in Lending Act. letters. About half of the comments were qualifying securities firm does not have The commentary applies and interprets from financial institutions, other to comply with the rating requirements the requirements of Regulation Z. The creditors, and their representatives. under paragraph (a)(1)(ii)(H)(1) of this revisions clarify how creditors that Most of the remaining comment letters section if the claim arises under a place Truth in Lending Act disclosures were from consumer advocates. The contract that: on the same document with the credit comment letters focused mainly on the (i) Is a reverse repurchase/repurchase contract may satisfy the requirement for proposed comment concerning agreement or securities lending/ providing the disclosures, in a form the disclosures placed on the same borrowing transaction executed using consumer may keep, before document with the credit contract. standard industry documentation; consummation. In addition, the Although commenters generally (ii) Is collateralized by debt or equity revisions provide guidance on supported the proposal, most requested securities that are liquid and readily disclosing costs for certain credit additional clarifications. Commenters marketable; insurance policies and on the definition also supported the proposed (iii) Is marked-to-market daily; of ‘‘business day’’ for purposes of the clarification concerning disclosure of (iv) Is subject to a daily margin right to rescind certain home-secured insurance premiums, but were divided maintenance requirement under the loans. The Board is also publishing on the proposed comment concerning standard industry documentation; and technical corrections to the commentary the definition of ‘‘business day.’’ (v) Can be liquidated, terminated or and regulation. As discussed below, the commentary accelerated immediately in bankruptcy is being adopted substantially as or similar proceeding, and the security DATES: The rule is effective April 9, proposed. In response to commenters’ or collateral agreement will not be 2002. suggestions, some revisions have been stayed or avoided under applicable law FOR FURTHER INFORMATION CONTACT: made for clarity. In addition, several of the relevant jurisdiction. For David A. Stein, Senior Attorney, or Dan technical corrections are being made to example, a claim is exempt from the S. Sokolov, Attorney; Division of the commentary and regulation. The
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revisions represent a clarification of the The comment is being adopted as Subpart C—Closed-End Credit existing law and do not impose new proposed. The comment does not Section 226.17 General Disclosure requirements. represent a new rule, but merely restates Requirements Generally, updates to the Board’s staff and clarifies the requirement contained commentary are effective upon in section 226.2(a)(6) of the regulation. 17(a) Form of Disclosures publication. Consistent with the Consumers’ ability to exercise their right The Board is adopting a technical requirements of TILA section 105(d), the to rescind is not affected because amendment to footnote 38 to conform Board typically provides an consumers can mail a notice of the citation regarding variable-rate implementation period of six months or rescission on the observed holiday; the disclosures to § 226.18(f)(1)(iv) of the longer. During that period compliance notice is not required to be postmarked regulation. No substantive change is with the published update is optional to or delivered on that day. Consumers are intended. afford creditors time to adjust their not likely to be confused because the disclosure documents. The commentary rescission notice must indicate the 17(b) Time of Disclosures revisions discussed below do not specific date that the rescission period The Board proposed to add comment involve different disclosure expires. See § 226.15(b)(5), 17(b)–3 to clarify how creditors that use requirements. Accordingly, the Board § 226.23(b)(1)(v). A creditor may extend a single document for the credit contract has determined that delayed the rescission period at its option. and TILA disclosures may satisfy the implementation of the revisions is requirement that disclosures be unnecessary. Section 226.4 Finance Charge provided to the consumer before II. Proposed Revisions 4(d) Insurance and Debt Cancellation consummation in a form the consumer Coverage may keep. For the reasons discussed Subpart A—General below, the comment is being adopted Section 226.2 Definitions and Rules of Comment 4(d)–12(i) is adopted substantially as proposed. Under section substantially as proposed. Construction The practice of putting TILA 226.4(d), amounts paid for credit disclosures on the same document with 2(a) Definitions insurance or debt cancellation coverage the credit contract is common in may be excluded from the finance 2(a)(6) Business Day connection with motor vehicle charge if the creditor discloses the fee or installment sales. Several recent court Generally, when consumers have a premium for the initial term of coverage, decisions have addressed whether right to rescind a home-secured loan, among other conditions. As revised, creditors that use a single document they may exercise the right until comment 4(d)–12(i) clarifies that must provide consumers with a separate midnight of the third business day creditors have the option of providing copy of the disclosures to keep before following consummation or the delivery disclosures on the basis of one year of providing a second copy that the of certain disclosures, whichever occurs coverage where the fee or premium for consumer may execute to become last. For purposes of rescission, section the coverage is assessed periodically obligated on the credit contract. The 226.2(a)(6) defines ‘‘business day’’ to and the consumer is under no obligation court decisions have not been uniform mean all calendar days except Sundays to continue the coverage. The revision in their result. and the federal legal holidays listed in clarifies that this option applies when The comment clarifies that creditors 5 U.S.C. 6103(a). The statute lists ten the consumer can cancel the coverage, satisfy TILA by giving a copy of the legal holidays; it identifies four holidays whether or not the consumer has made document containing the disclosures to by a specific date (New Year’s Day, an initial payment. Those that the consumer to read and sign. January 1; Independence Day, July 4; commented on this aspect of the Commenters generally agreed with this Veterans Day, November 11; Christmas proposal generally supported the aspect of the proposal. In response to Day, December 25). Comment 2(a)(6)-2 change. was proposed to clarify that for these commenters’ suggestions, the final four holidays, only the date specified in Several industry commenters urged comment has been revised to clarify that the statute is considered a legal holiday the Board to specify that unit-cost a creditor need not give the consumer for purposes of rescission. Thus, if the disclosures would be permissible when two copies. date specified in the statute falls on a premiums for coverage on closed-end Comment 17(b)–3 also clarifies that it weekend, the Friday before the specified loans are assessed periodically and the is not sufficient for the creditor merely date or the Monday following it are coverage can be cancelled. Regulation Z to show the document containing the considered business days even if permits unit-cost disclosures in closed- TILA disclosures to the consumer before government offices are closed in end transactions only in limited the consumer signs and becomes observance of the holiday. circumstances. See § 226.4(d)(1)(ii). obligated. Rather, a creditor must give Comments on this proposal were Accordingly, the commenters’ the disclosures to the consumer, so that about evenly divided. Several industry suggestion is beyond the scope of the the consumer is free to take possession trade associations supported the proposed commentary revision. of and review the disclosures in their proposal. Some consumer advocates and Subpart B—Open-End Credit entirety before signing. a few commenters representing small Commenters disagreed over the extent financial institutions were concerned Section 226.6 Initial Disclosure to which the comment should address that confusion would result if weekdays Statement the ability of a consumer to take observed as holidays are considered 6(b) Other Charges physical possession of, and keep, the business days. Some commenters document containing the disclosures. expressed concern that consumers The Board is adopting a technical Consumer advocates believe that a might lose a day of their rescission amendment to comment 6(b)–1 to consumer should be able to take period if they are unable to postmark or conform the citation in paragraph vi. to possession of and keep the disclosure otherwise deliver their written notice of comment 4(a)–4, as amended (60 FR whether or not the consumer rescission on weekdays observed as 16771, April 3, 1995). No substantive consummates the transaction at that holidays. change is intended. time. Some industry commenters
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contended that the creditor need only conform a citation to section 2. Rescission rule. A more precise rule for present or show the document to the 226.19(b)(2), as amended. No what is a business day (all calendar days consumer. substantive changes are intended. except Sundays and the federal legal Comment 17(b)–3 is being adopted holidays listed in 5 U.S.C. 6103(a)) applies substantially as proposed. Allowing a List of Subjects in 12 CFR Part 226 when the right of rescission or mortgages subject to § 226.32 are involved. (See also consumer to take possession of and Consumer protection, Disclosures, comment 31(c)(1)–1.) Four federal legal review TILA disclosures in their Federal Reserve System, Truth in holidays are identified in 5 U.S.C. 6103(a) by entirety—including any required lending. a specific date: New Year’s Day, January 1; information that may be on the reverse Independence Day, July 4; Veterans Day, side or continued on the next page—is Text of Revisions November 11; and Christmas Day, December essential to meaningful disclosure and Comments are numbered to comply 25. When one of these holidays (July 4, for fulfillment of the regulation’s with Federal Register publication rules. example) falls on a Saturday, federal offices requirement that disclosure be in a form For the reasons set forth in the and other entities might observe the holiday the consumer may keep. Whether or not on the preceding Friday (July 3). The preamble, the Board amends 12 CFR observed holiday (in the example, July 3) is the consumer signs and becomes part 226 as follows: a business day for purposes of rescission or obligated, the consumer will have the delivery of disclosures for certain high- received a copy of the disclosures. PART 226—TRUTH IN LENDING cost mortgages covered by § 226.32. Some industry commenters asserted (REGULATION Z) * * * * * that even though creditors must provide consumers written disclosures before 1. The authority citation for part 226 § 226.4—Finance Charge consummation, there is no requirement continues to read as follows: * * * * * that consumers receive a copy to keep Authority: 12 U.S.C. 3806; 15 U.S.C. 1604 4(d) Insurance and debt cancellation at the time the credit transaction is and 1637(c)(5). coverage. consummated. These commenters * * * * * suggest that creditors are required only § 226.17 [Amended] 12. Initial term; alternative. i. General. A to give consumers a copy to keep within 2. Section 226.17, in paragraph (a)(1), creditor has the option of providing cost a reasonable time after consummation. footnote 38, is amended by removing disclosures on the basis of an assumed initial The Board believes such a result would term of one year of insurance or debt- ‘‘§ 226.18(f)(4)’’ and adding cancellation coverage instead of a longer be inconsistent with the regulation’s ‘‘§ 226.18(f)(1)(iv)’’ in its place. requirement that consumers receive a initial term (provided the premium or fee is 3. In Supplement I to Part 226: clearly labeled as being for one year) if: copy, in a form they may keep, before a. Under Section 226.2—Definitions A. The initial term is indefinite or not consummation. Under the final and Rules of Construction, under 2(a)(6) clear, or comment as adopted, consumers must Business Day, paragraph 2. is revised. B. The consumer has agreed to pay a receive a copy to keep at the time they b. Under Section 226.4—Finance premium or fee that is assessed periodically become obligated. but the consumer is under no obligation to Charge, under 4(d) Insurance and Debt A few commenters were concerned continue the coverage, whether or not the that the proposal could be interpreted to Cancellation Coverage, paragraph 12. is consumer has made an initial payment. require a creditor to keep open revised. ii. Open-end plans. For open-end plans, a indefinitely its offer of credit if a c. Under Section 226.6—Initial creditor also has the option of providing unit- consumer decides not to sign and Disclosure Requirements, under cost disclosure on the basis of a period that is less than one year if the consumer has retains a copy of the unsigned Paragraph 6(b), paragraph 1.vi. is amended by removing ‘‘comment 4(a)– agreed to pay a premium or fee that is document. The extent to which an offer assessed periodically, for example monthly, of credit remains open is a matter of 5’’ and adding ‘‘comment 4(a)–4’’ in its place. but the consumer is under no obligation to state law and is not determined by continue the coverage. TILA. d. Under Section 226.17—General iii. Examples. To illustrate: Several commenters questioned Disclosure Requirements, under 17(b) A. A credit life insurance policy providing whether the language in the proposed Time of Disclosures, a new paragraph 3. coverage for a 30-year mortgage loan has an comment allowing consumers to ‘‘take is added. initial term of 30 years, even though possession’’ of the disclosures was e. Under Section 226.32— premiums are paid monthly and the consistent with creditors’ ability to Requirements for Certain Closed-End consumer is not required to continue the Home Mortgages, under Paragraph coverage. Disclosures may be based on the provide the disclosures electronically if initial term, but the creditor also has the the consumer consents. Comment 17(b)– 32(c)(3), paragraph 1. is revised; and option of making disclosures on the basis of 3 is not intended to affect the rules under Paragraph 32(c)(4), paragraph 1. coverage for an assumed initial term of one governing the use of electronic is amended by removing year. communications under Regulation Z. ‘‘§ 226.19(b)(2)(x)’’ and adding * * * * * § 226.19(b)(2)(viii)(B)’’ in its place. Subpart E—Special Rules for Certain Subpart C—Closed-End Credit Home Mortgage Transactions Supplement I to Part 226—Official Staff Interpretations Section 226.32 Requirements for * * * * * Certain Closed-end Home Mortgages * * * * * § 226.17—General Disclosure Requirements 32(c) Disclosures Subpart A—General * * * * * 17(b) Time of disclosures. The Board is republishing comment * * * * * 32(c)(3)–3 in its entirety, as amended in * * * * * 3. Disclosures provided on credit contracts. December 2001, to reinsert language that § 226.2—Definition and Rules of Construction Creditors must give the required disclosures was inadvertently deleted due to a to the consumer in writing, in a form that the technical error (66 FR 65604, December * * * * * consumer may keep, before consummation of 20, 2001). A technical amendment is 2(a)(6) Business day. the transaction. See § 226.17(a)(1) and (b). also made to comment 32(c)(4)–1 to * * * * * Sometimes the disclosures are placed on the
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same document with the credit contract. is $250 for the first six months and then from Airbus Industrie, 1 Rond Point Creditors are not required to give the increases based on an index and margin, the Maurice Bellonte, 31707 Blagnac Cedex, consumer two separate copies of the creditor could use language such as the France. This information may be document before consummation, one for the following: ‘‘Your regular monthly payment examined at the Federal Aviation consumer to keep and a second copy for the will be $250 for six months. After six months consumer to execute. The disclosure your regular monthly payment will be based Administration (FAA), Transport requirement is satisfied if the creditor gives on an index and margin, which currently Airplane Directorate, Rules Docket, a copy of the document containing the would make your payment $350. Your actual 1601 Lind Avenue, SW., Renton, unexecuted credit contract and disclosures to payment at that time may be higher or Washington; or at the Office of the the consumer to read and sign; and the lower.’’ Federal Register, 800 North Capitol consumer receives a copy to keep at the time * * * * * Street, NW., suite 700, Washington, DC. the consumer becomes obligated. It is not sufficient for the creditor merely to show the By order of the Board of Governors of the FOR FURTHER INFORMATION CONTACT: Dan consumer the document containing the Federal Reserve System, acting through the Rodina, Aerospace Engineer, disclosures before the consumer signs and Director of the Division of Consumer and International Branch, ANM–116, FAA, becomes obligated. The consumer must be Community Affairs and the Secretary of the Transport Airplane Directorate, 1601 free to take possession of and review the Board under delegated authority, April 2, Lind Avenue, SW., Renton, Washington document in its entirety before signing. 2002. 98055–4056; telephone (425) 227–2125; i. Example. To illustrate: Jennifer J. Johnson, fax (425) 227–1149. A. A creditor gives a consumer a multiple- Secretary of the Board. SUPPLEMENTARY INFORMATION: A copy form containing a credit agreement and [FR Doc. 02–8373 Filed 4–8–02; 8:45 am] TILA disclosures. The consumer reviews and proposal to amend part 39 of the Federal signs the form and returns it to the creditor, BILLING CODE 6210–01–P Aviation Regulations (14 CFR part 39) to who separates the copies and gives one copy include an airworthiness directive (AD) to the consumer to keep. The creditor has that is applicable to all Airbus Model satisfied the disclosure requirement. DEPARTMENT OF TRANSPORTATION A300 B2, A300 B4, A300 B4–600, and * * * * * A300 B4–600R series airplanes; and Federal Aviation Administration Model A300 F4–605R airplanes; was Subpart E—Special Rules for Certain published as a supplemental notice of Home Mortgage Transactions 14 CFR Part 39 proposed rulemaking (NPRM) in the * * * * * [Docket No. 99–NM–86–AD; Amendment Federal Register on January 4, 2002 (67 39–12699; AD 2002–07–05] FR 530). That action proposed to require § 226.32—Requirements for Certain Closed- RIN 2120–AA64 repetitive inspections for cracking of End Home Mortgages certain fittings, corrective action if * * * * * Airworthiness Directives; Airbus Model necessary, and, for certain airplanes, a Paragraph 32(c)(3) Regular payment; A300 B2, A300 B4, A300 B4–600, and modification; and would have provided balloon payment. A300 B4–600R Series Airplanes; and for optional terminating action for the 1. General. The regular payment is the Model A300 F4–605R Airplanes repetitive inspections. amount due from the borrower at regular intervals, such as monthly, bimonthly, AGENCY: Federal Aviation Comments quarterly, or annually. There must be at least Administration, DOT. Interested persons have been afforded two payments, and the payments must be in ACTION: Final rule. an amount and at such intervals that they an opportunity to participate in the making of this amendment. Due fully amortize the amount owed. In SUMMARY: This amendment adopts a consideration has been given to the disclosing the regular payment, creditors may new airworthiness directive (AD), comments received from a single rely on the rules set forth in § 226.18(g); applicable to all Airbus Model A300 B2, however, the amounts for voluntary items, commenter in response to the second A300 B4, A300 B4–600, and A300 B4– such as credit life insurance, may be supplemental NPRM. included in the regular payment disclosure 600R series airplanes, and Model A300 only if the consumer has previously agreed F4–605R airplanes. This AD requires Provide Credit for Prior Inspection and to the amounts. repetitive inspections for cracking of Refer to Terminating Action i. If the loan has more than one payment certain fittings, corrective action if One commenter asks the FAA to level, the regular payment for each level must necessary, and, for certain airplanes, a be disclosed. For example: revise the proposed rule to provide modification. This AD also provides an credit for an inspection already A. In a 30-year graduated payment optional terminating action for the mortgage where there will be payments of performed in accordance with the $300 for the first 120 months, $400 for the repetitive inspections. The actions original issue of Airbus Service Bulletin next 120 months, and $500 for the last 120 specified by this AD are intended to A300–53–6048, dated January 16, 1996, months, each payment amount must be detect and correct propagation of cracks provided that the inspection is disclosed, along with the length of time that on the frame 40 aft fittings due to local accomplished in conjunction with the payment will be in effect. stress concentrations at the upper flange Airbus Service Bulletin A300–57–6053. B. If interest and principal are paid at runout of frame 40, which could result different times, the regular amount for each The commenter states that this would in reduced structural integrity of the make the proposed rule consistent with must be disclosed. airplane. This action is intended to C. In discounted or premium variable-rate the original issue of the corresponding transactions where the creditor sets the address the identified unsafe condition. French airworthiness directive, 98–481– initial interest rate and later rate adjustments DATES: Effective May 14, 2002. 270(B), dated December 2, 1998. are determined by an index or formula, the The incorporation by reference of The same commenter also requests creditor must disclose both the initial certain publications listed in the that we revise the proposed rule to payment based on the discount or premium regulations is approved by the Director provide for optional terminating action and the payment that will be in effect of the Federal Register as of May 14, on Model A300 B4–600 and A300 B4– thereafter. Additional explanatory material 2002. which does not detract from the required 600R series airplanes and Model A300 disclosures may accompany the disclosed ADDRESSES: The service information F4–605R airplanes. The commenter amounts. For example, if a monthly payment referenced in this AD may be obtained states that inspection and rework per
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Airbus Service Bulletins A300–57–6052 The cost impact figures discussed Administrator, the Federal Aviation and A300–57–6053 constitutes above are based on assumptions that no Administration amends part 39 of the terminating action for airplanes on operator has yet accomplished any of Federal Aviation Regulations (14 CFR which no cracks are found and no the requirements of this AD action, and part 39) as follows: subsequent rework is required. that no operator would accomplish The FAA concurs with the intent of those actions in the future if this AD PART 39—AIRWORTHINESS the commenter’s request, but we have were not adopted. The cost impact DIRECTIVES already accommodated the request figures discussed in AD rulemaking previously. We added Note 2 to the first actions represent only the time 1. The authority citation for part 39 supplemental NPRM to provide credit necessary to perform the specific actions continues to read as follows: for an inspection done in accordance actually required by the AD. These Authority: 49 U.S.C. 106(g), 40113, 44701. with the original issue of Airbus Service figures typically do not include Bulletin A300–53–6048. In addition, we incidental costs, such as the time § 39.13 [Amended] revised paragraph (b)(8) and paragraph required to gain access and close up, 2. Section 39.13 is amended by (e) in the first supplemental NPRM to planning time, or time necessitated by adding the following new airworthiness clarify that modification per Airbus other administrative actions. directive: Service Bulletin A300–57–6053, Revision 1, dated October 31, 1995, or Regulatory Impact 2002–07–05 Airbus Industrie: Amendment Revision 02, dated June 2, 1999, The regulations adopted herein will 39–12699. Docket 99–NM–86–AD. terminates the proposed requirements, not have a substantial direct effect on Applicability: All Model A300 B2, A300 regardless of the inspection results. No the States, on the relationship between B4, A300 B4–600, and A300 B4–600R series change to the final rule is necessary. the national Government and the States, airplanes; and Model A300 F4–605R airplanes; certificated in any category. Conclusion or on the distribution of power and responsibilities among the various Note 1: This AD applies to each airplane After careful review of the available levels of government. Therefore, it is identified in the preceding applicability provision, regardless of whether it has been data, including the comments noted determined that this final rule does not above, the FAA has determined that air modified, altered, or repaired in the area have federalism implications under subject to the requirements of this AD. For safety and the public interest require the Executive Order 13132. adoption of the rule as proposed in the airplanes that have been modified, altered, or For the reasons discussed above, I second supplemental NPRM. repaired so that the performance of the certify that this action (1) is not a requirements of this AD is affected, the Cost Impact ‘‘significant regulatory action’’ under owner/operator must request approval for an The FAA estimates that 70 Model Executive Order 12866; (2) is not a alternative method of compliance in accordance with paragraph (g) of this AD. A300 B2, A300 B4, A300 B4–600, and ‘‘significant rule’’ under DOT Regulatory Policies and Procedures (44 The request should include an assessment of A300 B4–600R series airplanes; and the effect of the modification, alteration, or Model A300 F4–605R airplanes; of U.S. FR 11034, February 26, 1979); and (3) will not have a significant economic repair on the unsafe condition addressed by registry will be affected by this AD. this AD; and, if the unsafe condition has not For affected airplanes, it will take impact, positive or negative, on a been eliminated, the request should include approximately 92 work hours per substantial number of small entities specific proposed actions to address it. under the criteria of the Regulatory airplane to accomplish the required Compliance: Required as indicated, unless modification, at an average labor rate of Flexibility Act. A final evaluation has accomplished previously. $60 per work hour. Required parts will been prepared for this action and it is To detect and correct propagation of cracks cost as much as $874 per airplane. contained in the Rules Docket. A copy on the frame 40 aft fittings due to local stress Based on these figures, the cost impact of it may be obtained from the Rules concentrations at the upper flange runout of of the required modification is Docket at the location provided under frame 40, which could result in reduced estimated to be as much as $6,394 per the caption ADDRESSES. structural integrity of the airplane, accomplish the following: airplane. List of Subjects in 14 CFR Part 39 It will take approximately 10 work Modification hours per airplane to accomplish the Air transportation, Aircraft, Aviation safety, Incorporation by reference, (a) For airplanes on which Airbus required inspection, at an average labor Modification 10430 has not been done before Safety. rate of $60 per work hour. Based on the effective date of this AD: Concurrently these figures, the cost impact of the Adoption of the Amendment with the inspection required by paragraph (b) required inspection on U.S. operators is of this AD, modify the profile of frame 40 aft estimated to be $42,000, or $600 per Accordingly, pursuant to the fittings per the service information specified airplane, per inspection cycle. authority delegated to me by the in Table 1, as follows:
TABLE 1.—SERVICE INFORMATION
Do the actions in accord- Of Airbus Service For Model— ance with either— Bulletin— Dated—
(1) A300 B2 and A300 B4 series airplanes ...... (i) Revision 01 or ...... A300–53–0296 ...... September 30, 1998. (ii) Revision 02 ...... A300–53–0296 ...... May 12, 1999. (2) A300 B4–600 and A300 B4–600R series airplanes (i) Revision 01 or ...... A300–53–6048 ...... September 30, 1998. and Model A300 F4–605R airplanes. (ii) Revision 03 ...... A300–53–6048 ...... February 21, 2000.
Note 2: For Model A300 B4–600 and A300 F4–605R airplanes: Actions performed in A300–53–6048, dated January 16, 1996; or B4–600R series airplanes and Model A300 accordance with Airbus Service Bulletin Revision 02, dated May 12, 1999; are
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acceptable for compliance with the 53–6063 as an additional source of service Inspection applicable requirements of this AD. information for accomplishment of certain (b) For all airplanes, inspect the airplane Note 3: Airbus Service Bulletin A300–53– repairs. per Table 2, as follows: 6048 refers to Airbus Service Bulletin A300–
TABLE 2.—INSPECTION REQUIREMENTS
Requirements Description
(1) Area to inspect ...... The frame 40 AFT fitting. (2) Type of inspection ...... Nondestructive test (NDT). (3) Compliance time ...... As specified by paragraph (c) of this AD. (4) Discrepancies to detect ...... Cracking. (5) Service information ...... Inspect in accordance with the applicable service bulletin listed in Table 1 of this AD. (6) Follow-on actions if you find no cracking ...... Repeat the inspection thereafter at the applicable interval specified by Table 3 of this AD. (7) Corrective actions if you find cracking ...... Do the actions specified by paragraph (d) of this AD. (8) Terminating action ...... The modification specified by paragraph (e) of this AD terminates the requirements of this AD.
Note 4: An NDT per Non-destructive (c) Perform the inspection required by compliance time may be extended by the Testing Manual 53–15–30, Part 6, Procedure paragraph (b) of this AD per the schedule in repetitive interval following the date the C, is also acceptable for compliance with the Table 3 of this AD. For airplanes on which inspection was accomplished. Table 3 requirements of paragraph (b) of this AD. this inspection has been accomplished before follows: the effective date of this AD, the initial
TABLE 3.—COMPLIANCE TIMES FOR INSPECTION
If the total flight cycles ac- cumulated on the airplane And repeat the inspection For Model— as of the effective date of Then inspect— at least every— this AD is—
(1) A300 B4–600 and A300 (i) Fewer than 6,200 ...... Before the airplane accumulates 7,700 total flight cy- 7,500 flight cycles or B4–600R series airplanes cles or 17,710 total flight hours, whichever occurs 17,250 flight hours, and Model A300 F4–605R first. whichever occurs first. airplanes, pre-Modification 10430. (ii) At least 6,200 and Within 1,500 flight cycles or 3,450 flight hours after the 7,500 flight cycles or fewer than 9,700. effective date of this AD, whichever occurs first. 17,250 flight hours, whichever occurs first. (iii) At least 9,700 ...... Within 750 flight cycles or 1,725 flight hours after the 7,500 flight cycles or effective date of this AD, whichever occurs first. 17,250 flight hours, whichever occurs first. (2) A300 B4–600 and A300 (i) Fewer than 19,600 ...... Before the airplane accumulates 21,100 total flight cy- 7,500 flight cycles or B4–600R series airplanes cles or 48,530 total flight hours, whichever occurs 17,250 flight hours, and Model A300 B–4605R first. whichever occurs first. airplanes, post-Modifica- tion 10430. (ii) At least 19,600 and Within 1,500 flight cycles or 3,450 flight hours after the 7,500 flight cycles or fewer than 23,100. effective date of this AD, whichever occurs first. 17,250 flight hours, whichever occurs first. (iii) At least 23,100 ...... Within 750 flight cycles or 1,725 flight hours after the 7,500 flight cycles or effective date of this AD, whichever occurs first. 17,250 flight hours, whichever occurs first. (3) A300 B2 series airplanes (i) Fewer than 12,00 ...... Before the airplane accumulates 14,000 total flight cy- 5,500 flight cycles or 5,940 cles or 15,120 total flight hours, whichever occurs flight hours, whichever first. occurs first. (ii) At least 12,000 and Within 2,000 flight cycles or 2,160 flight hours after the 5,500 flight cycles or 5,940 fewer than 17,000. effective date of this AD, whichever occurs first. flight hours, whichever occurs first. (iii) At least 17,000 ...... Within 1,000 flight cycles or 1,080 flight hours after the 5,500 flight cycles or 5,940 effective date of this AD, whichever occurs first. flight hours, whichever occurs first. (4) A300 B4–100 series air- (i) Fewer than 9,500 ...... Before the airplane accumulates 11,500 total flight cy- 4,500 flight cycles or 5,985 planes. cles or 15,295 total flight hours, whichever occurs flight hours, whichever first. occurs first. (ii) At least 9,500 and Within 2,000 flight cycles or 2,660 flight hours after the 4,500 flight cycles or 5,985 fewer than 14,500. effective date of this AD, whichever occurs first. flight hours, whichever occurs first. (iii) At least 14,500 ...... Within 1,000 flight cycles or 1,330 flight hours after the 4,500 flight cycles or 5,985 effective date of this AD, whichever occurs first. flight hours, whichever occurs first.
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TABLE 3.—COMPLIANCE TIMES FOR INSPECTION—Continued
If the total flight cycles ac- cumulated on the airplane And repeat the inspection For Model— as of the effective date of Then inspect— at least every— this AD is—
(5) A300 B4–200 series air- (i) Fewer than 8,500 ...... Before the airplane accumulates 10,500 total flight cy- 4,000 flight cycles or 8,320 planes. cles or 21,840 total flight hours, whichever occurs flight hours, whichever first. occurs first. (ii) At least 8,500 and Within 2,000 flight cycles or 4,160 flight hours after the 4,000 flight cycles or 8,320 fewer than 13,500. effective date of this AD, whichever occurs first. flight hours, whichever occurs first. (iii) At least 13,500 ...... Within 1,000 flight cycles or 2,080 flight hours after the 4,000 flight cycles or 8,320 effective date of this AD, whichever occurs first. flight hours, whichever occurs first.
Note 5: An NDT inspection is also required paragraph (e)(1) or (e)(2) of this AD International Branch, ANM–116. Operators by AD 98–25–07, amendment 39–10933, to terminates the requirements of this AD. shall submit their requests through an be repetitively performed on Model A300 (1) For Model A300 B4–600 and A300 B4– appropriate FAA Principal Maintenance B4–600 and A300 B4–600R series airplanes 600R series airplanes: In accordance with Inspector, who may add comments and then and Model A300 F4–605R airplanes on Airbus Service Bulletin A300–57–6053, send it to the Manager, International Branch, which Airbus Modification 10453 has not Revision 1, dated October 31, 1995; or ANM–116. Revision 02, dated June 2, 1999. been installed. For those airplanes, if the (2) For Model A300 B2 and A300 B4 series Note 6: Information concerning the inspection is done within the applicable airplanes: In accordance with Airbus Service existence of approved alternative methods of compliance time specified by paragraph (c) of Bulletin A300–53–0297, Revision 2, dated compliance with this AD, if any, may be this AD, the threshold for the initial October 31, 1995. obtained from the International Branch, inspection of paragraph (b) of this AD may ANM–116. be extended by 1,500 flight cycles. Exception to Service Bulletin Instructions (f) During any inspection required by this Special Flight Permits Corrective Actions AD, if the service bulletin specifies to contact (h) Special flight permits may be issued in (d) If any cracking is found during any the manufacturer for an appropriate action: accordance with §§ 21.197 and 21.199 of the inspection required by paragraph (b) of this Prior to further flight, repair in accordance Federal Aviation Regulations (14 CFR 21.197 with a method approved by the Manager, AD: Except as required by paragraph (f) of and 21.199) to operate the airplane to a International Branch, ANM–116, Transport this AD, prior to further flight, perform all Airplane Directorate, FAA; or the Direction location where the requirements of this AD applicable corrective actions in accordance Ge´ne´rale de l’Aviation Civile (DGAC) (or its can be accomplished. with the applicable service bulletin delegated agent). Incorporation by Reference identified in Table 1 of this AD. Alternative Methods of Compliance (i) Except as required by paragraph (f) of Terminating Action (g) An alternative method of compliance or this AD, the required actions shall be done (e) Accomplishment of the applicable adjustment of the compliance time that in accordance with the applicable service modification in accordance with the provides an acceptable level of safety may be documents identified in Table 4 and Table 5 applicable service bulletin specified by used if approved by the Manager, of this AD, as follows:
TABLE 4.—REFERENCED SERVICE DOCUMENTS FOR REQUIRED ACTIONS
Service bulletin and date Page numbers Revision level shown on the page Date shown on page
Airbus Service Bulletin A300–53– 1–38 ...... 01 ...... September 30, 1998. 0296, Revision 01, September 30, 1998. Airbus Service Bulletin A300–53– 1–3, 8, 15, 16,18, 20, 22, 23,24 ... 02 ...... May 12, 1999. 0296, Revision 02, May 12, 1999. 4–7, 9–14, 17, 19, 21, 25, 26, 27– 01 ...... September 30, 1998. 38. Airbus Service Bulletin A300–53– 1–31 ...... 01 ...... September 30, 1998. 6048, Revision 01, September 30, 1998. Airbus Service Bulletin A300–53– 1–32 ...... 03 ...... February 21, 2000. 6048, Revision 03, February 21, 2000.
TABLE 5.—REFERENCED SERVICE DOCUMENTS FOR OPTIONAL TERMINATING ACTION
Revision level Service bulletin and date Page numbers shown on the Date shown on page page
Airbus Service Bulletin A300–57–6053, 1, 7–9, 11–15, 19–24, 35, 36, 41, 42, 1 ...... October 31, 1995. Revision 1, October 31, 1995. 45–47. 2–6, 10, 16–18, 25–34, 37–40, 43, 44 .. Original ...... February 21, 1995.
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TABLE 5.—REFERENCED SERVICE DOCUMENTS FOR OPTIONAL TERMINATING ACTION—Continued
Revision level Service bulletin and date Page numbers shown on the Date shown on page page
Airbus Service Bulletin A300–57–6053, 1–6, 8, 23, 23a, 46, 47 ...... 02 ...... June 2, 1999. Revision 02, June 2, 1999. 7, 9, 11, 12, 13–15, 19–22, 35, 36, 41, 1 ...... October 31, 1995. 42, 45. 10, 16–18, 25, 26, 27–34, 37–40, 43, Original ...... February 21, 1995. 44. Airbus Service Bulletin A300–53–0297, 1–60 ...... 2 ...... October 31, 1995. Revision 2, October 31, 1995.
This incorporation by reference was pressure bulkhead; corrective actions, if repetitive general visual and x-ray approved by the Director of the Federal necessary; and follow-on actions. For inspections to detect cracks of the upper Register in accordance with 5 U.S.C. 552(a) certain airplanes, the amendment also and lower corners and upper center of and 1 CFR part 51. Copies may be obtained requires modification of the ventral aft the door cutout of the aft pressure from Airbus Industrie, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France. pressure bulkhead. The actions bulkhead; corrective actions, if Copies may be inspected at the FAA, specified by this AD are intended to necessary; and follow-on actions. For Transport Airplane Directorate, 1601 Lind detect and correct fatigue cracks in the certain airplanes, the amendment also Avenue, SW., Renton, Washington; or at the corners and upper center of the door requires modification of the ventral aft Office of the Federal Register, 800 North cutout of the aft pressure bulkhead, pressure bulkhead. Capitol Street, NW., suite 700, Washington, which could result in rapid Comments DC. decompression of the fuselage and Note 7: The subject of this AD is addressed consequent reduced structural integrity Interested persons have been afforded in French airworthiness directive 1998–481– of the airplane. This action is intended an opportunity to participate in the 270(B) R1, dated July 12, 2000. to address the identified unsafe making of this amendment. Due consideration has been given to the Effective Date condition. comments received. (j) This amendment becomes effective on DATES: Effective May 14, 2002. May 14, 2002. The incorporation by reference of Requests To Revise Certain Inspection Requirements Issued in Renton, Washington, on March certain publications listed in the 28, 2002. regulations is approved by the Director Three commenters request revision of Kalene C. Yanamura, of the Federal Register as of May 14, the inspection requirements in Acting Manager, Transport Airplane 2002. paragraph (b) of the proposed rule. The rationales for these requests are as Directorate, Aircraft Certification Service. ADDRESSES: The service information [FR Doc. 02–8278 Filed 4–8–02; 8:45 am] referenced in this AD may be obtained follows: • One commenter suggests revising BILLING CODE 4910–13–P from Boeing Commercial Aircraft paragraph (b) of the proposed rule to Group, Long Beach Division, 3855 specify the same inspections cited in Lakewood Boulevard, Long Beach, McDonnell Douglas Service Bulletin DEPARTMENT OF TRANSPORTATION California 90846, Attention: Data and DC9–53–137, Revision 07, dated Service Management, Dept. C1–L5A Federal Aviation Administration February 6, 2001, which was cited as (D800–0024). This information may be the appropriate source of service examined at the FAA, Transport 14 CFR Part 39 information for this AD. The commenter Airplane Directorate, 1601 Lind states that paragraph (b) of the proposed [Docket No. 2000–NM–324–AD; Amendment Avenue, SW., Renton, Washington; or at rule is misleading because it incorrectly 39–12700; AD 2002–07–06] the FAA, Los Angeles Aircraft implies that a repair will always be Certification Office, 3960 Paramount RIN 2120–AA64 required or that a preventive Boulevard, Lakewood, California. modification is required. In addition, Airworthiness Directives; McDonnell FOR FURTHER INFORMATION CONTACT: that paragraph does not allow for Douglas Model DC–9–10, –20, –30, –40, Wahib Mina, Aerospace Engineer, continuing visual and x-ray inspections and –50 Series Airplanes; and C–9 Airframe Branch, ANM–120L, FAA, Los as specified in the previously referenced Airplanes Angeles Aircraft Certification Office, service bulletin. 3960 Paramount Boulevard, Lakewood, • AGENCY: Federal Aviation One commenter requests Administration, DOT. California 90712; telephone (562) 627– clarification of the inspection 5324; fax (562) 627–5210. ACTION: Final rule. procedures specified in the proposed SUPPLEMENTARY INFORMATION: A rule. Paragraph (b) of the proposed rule SUMMARY: This amendment adopts a proposal to amend part 39 of the Federal specifies visual and eddy current new airworthiness directive (AD), Aviation Regulations (14 CFR part 39) to inspections within 8,000 landings after applicable to certain McDonnell include an airworthiness directive (AD) accomplishment of the visual and x-ray Douglas Model DC–9–10, –20, –30, –40, that is applicable to certain McDonnell inspections required by paragraph (a) of and –50 series airplanes; and C–9 Douglas Model DC–9–10, –20, –30, –40, this AD. However, Service Bulletin airplanes; that requires repetitive visual and –50 series airplanes; and C–9 DC9–53–137, Revision 07, specifies and x-ray inspections to detect cracks of airplanes; was published in the Federal visual and eddy current inspections the upper and lower corners and upper Register on September 20, 2001 (66 FR after a repair or preventive modification center of the door cutout of the aft 48384). That action proposed to require is installed. The proposed rule would
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not require a preventive modification if Revision 04, or earlier, of McDonnell the service bulletin. As a result, we have no cracks are found. However, the no- Douglas DC–9 Service Bulletin 53–137, reformatted paragraph (b) of the final crack procedures specified in the and that an alternative method of rule to include paragraphs (b)(1) and service bulletin provide the option of compliance (AMOC) to AD 85–01–02 (b)(2), which require accomplishment of either accomplishing the preventive R1, amendment 39–5241 (51 FR 6101, the inspections at the times specified in modification and thereafter a visual and February 20, 1986), permits repetitive Revision 07 of the service bulletin, as eddy current inspection, or not inspections at intervals of 15,000 applicable. We consider that these accomplishing the modification and landings until accomplishment of the changes only clarify the required continuing the visual and x-ray terminating action per McDonnell inspections and related compliance inspections at various intervals Douglas DC–9 Service Bulletin 53–166. times, and do not impose an additional depending on the condition. With this in mind, the commenter asks burden on any operator or necessitate • One commenter considers that the whether the repetitive intervals of providing an additional opportunity for proposed rule should require visual and previously modified airplanes will be public comment. eddy current inspections only if no reduced from 15,000 landings to 8,000 Request To Revise Type of Inspection cracks are found and interim preventive landings regardless of modification/ per the Service Information repairs are performed per Service repair status. Bulletin DC9–53–137, Revision 07. The The FAA concurs that clarification of One commenter states that the commenter suggests clarifying that the repetitive inspection intervals for definition of a ‘‘general visual interim preventive repairs are to be previously repaired or modified inspection’’ in Note 2 of the proposed performed per the service bulletin, and airplanes (interim preventive repairs) is rule is not the same as that of a ‘‘visual that continued visual and x-ray necessary. We point out that McDonnell inspection’’ in Service Bulletin DC9– inspections are required for unmodified Douglas DC–9 Service Bulletin 53–137, 53–137, Revision 07. The commenter corners. The inspection requirements of Revision 05, dated August 29, 2000, states that the service bulletin has paragraph (b) are different from those changed the inspection method and the specific visual inspection requirements specified in the previously referenced inspection intervals for the aft pressure that are included in Service Sketch service bulletin. Although paragraph (b) bulkhead corners that previously have 2934E and SN09530002. The of the proposed rule requires been repaired or modified per earlier commenter considers that the proposed inspections at intervals of 8,000 revisions of the service bulletin. In rule should reflect the same type of landings after accomplishment of the addition, the inspection procedures inspection as that cited in the service inspections required by paragraph (a) of specified in Revision 05 of the service information. the proposed rule, the service bulletin bulletin also were approved as an The FAA concurs and agrees that the specifies inspections after AMOC for the accomplishment of AD final rule should reflect the same accomplishment of a repair or 85–01–02 R1. Although earlier revisions inspections specified by the service preventive modification. The service of the service bulletin specify ‘‘visual information. In the final rule we have bulletin also provides the option of and x-ray’’ inspections of previously deleted Note 2 to remove the definition either accomplishing the preventive repaired or modified corners, Revision of a ‘‘general visual inspection.’’ We modification followed by the 05 and later revisions of the service also have changed all references inspections, or not accomplishing the bulletin specify ‘‘visual and eddy throughout the final rule, including modification and continuing the current’’ inspections for those airplanes. paragraphs (a) and (b), to specify a inspections at specific intervals. After the type of inspection was ‘‘visual inspection’’ instead of a The FAA concurs with the changed, the manufacturer reconsidered ‘‘general visual inspection.’’ commenter’s requests to revise and the inspection intervals necessary for Request To Give Credit for Previously clarify the inspection requirements. In previously repaired or modified corners Accomplished Alternative Methods of making this decision, we have reviewed if no cracks are detected. As a result, for Compliance (AMOCs) the Accomplishment Instructions of the those airplanes, the manufacturer service bulletin and the inspection recommends inspection intervals of One commenter requests that credit requirements of paragraph (b) of the 8,000 landings for ‘‘visual and eddy be given to operators who have proposed rule. We point out that the current’’ inspections instead of 15,000 accomplished previously approved intent of paragraph (b) of the proposed landings for ‘‘visual and x-ray’’ AMOCs per AD 85–01–02 R1 or AD 96– rule is to require the same inspections inspections. 10–11, amendment 39–9618 (61 FR as those specified by the service After reconsidering the 24675, May 16, 1996). Another bulletin. Therefore, we have revised manufacturer’s recommendation, we commenter asks how the requirements paragraph (b) in the final rule to also have determined that the compliance of this AD affect previous AMOC include paragraphs (b)(1) and (b)(2). We times recommended in Revision 07 of approvals for inspections, repairs, and consider that this change provides an the service bulletin are adequate in modifications per AD 85–01–02 R1 and acceptable level of safety for the fleet. maintaining the safety of the fleet. It is AD 96–10–11. In addition, this necessary to revise paragraph (b) of the commenter asks whether AMOCs issued Request To Clarify the Repetitive proposed rule to clarify our intent per AD 90–18–03, amendment 39–6701 Inspection Intervals regarding the type of inspection and (55 FR 34704, August 24, 1990), are still One commenter states that, if no crack inspection intervals that are specified in considered valid. is detected, paragraph (b) in the paragraph 3.B. (‘‘Work Instructions’’) of The FAA concurs. In addition, we proposed rule requires visual and eddy the service bulletin (which was cited in point out that AD 90–18–03 was current inspections per Revision 07 of the proposed rule as the appropriate superseded by AD 96–10–11, which Service Bulletin DC9–53–137, within source of service information). We point gave credit for AMOCs previously 8,000 landings after accomplishing the out that the compliance times specified issued per AD 90–18–03. However, visual and x-ray inspections required by in Revision 07 of the service bulletin because AD 90–18–03 was removed paragraph (a) of the proposed rule. The vary according to the conditions and from the regulations, it is only necessary commenter states that it had previously groups of airplanes specified in to give credit for the prior accomplished modifications per paragraph 3.B. (‘‘Work Instructions’’) of accomplishment of AD 85–01–02 R1
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and AD 96–10–11 in paragraph (i)(2) of commenter adds that guidance is modification has not been done, visual the final rule. We have revised the final needed when the proposed rule cannot and x-ray inspections must be done rule accordingly. be complied with, and operators need to within the compliance time specified in know what to do. After contacting the paragraph (a) of this AD. Request To Clarify Previously Issued manufacturer for clarification of what • Paragraph (d)(2) specifies that ADs and Effect on Compliance Times in was meant by ‘‘something on a corner of accomplishment of the modification Follow-on ADs an airplane,’’ the commenter stated that specified by paragraph (d)(2) constitutes One commenter requests clarification the phrase refers to any previous repair terminating action for the repetitive of the difference between a standalone on the aft pressure bulkhead that any inspection requirements of paragraphs AD that supersedes an earlier AD, and operator may not be able to inspect per (b) and (c)(2) of this AD. a separate AD with a later action to the service bulletin. • Paragraph (i) includes two new rescind that AD. The commenter also The FAA does not concur. We point subparagraphs. Paragraph (i)(2) is added asks the following questions: out that the proposed rule does not need to give credit for AMOCs previously • If the FAA rescinds AD 85–01–02 to include additional corrective actions accomplished in accordance with AD R1, what happens to AD 80–10–03, because paragraph (i)(1) of this AD 85–01–02 R1 or AD 96–10–11. amendment 39–3769 (45 FR 31052, May includes a provision for operators to Paragraph (i)(3) is added to specify that, 15, 1980), that was superseded by AD request an AMOC for such an inspection if an inspection of the aft pressure 85–01–02, amendment 39–4978 (50 FR requirement. No change to the final rule bulkhead cannot be accomplished per 2043, January 15, 1985), and how are is necessary in this regard. the service bulletin, operators also may the concurrent service bulletin accomplish the inspection per data Request To Cite an Additional Service requirements affected by this decision? meeting the type certification basis of • Bulletin AD 85–01–02 R1 requires that the the airplane approved by a Boeing procedures specified by the service The commenter asks why some of the Company Designated Engineering bulletins be accomplished within Boeing service bulletins listed in AD Representative who has been authorized landing or time limits that have already 85–01–02 R1 are included in the by the FAA to make such findings. passed for most applicable airplanes. proposed rule and others are not. For How does rescinding AD 85–01–02 R1 example, McDonnell Douglas DC–9 Conclusion affect this compliance? Service Bulletin A53–144 is cited in AD After careful review of the available The FAA concurs and agrees that it is 85–01–02 R1, but is not cited in this data, including the comments noted necessary to clarify the difference proposed rule. The commenter above, the FAA has determined that air between the two types of ADs. In considers that, if certain other service safety and the public interest require the response, we point out that in the bulletins specified in that AD are adoption of the rule with the changes preamble of the proposed AD, in ‘‘Other included in this proposed rule, we also previously described. We also have Relevant Rulemaking,’’ we stated that need to include DC–9 Service Bulletin determined that these changes will the FAA normally would issue a A53–144. This is necessary in case any neither increase the economic burden proposed AD to supersede AD 85–01–02 airplane that has not been modified per on any operator nor increase the scope R1. However, because of the complexity the AD is brought into the United States, of the AD. of the requirements in AD 85–01–02 R1, and to prevent any operator from Cost Impact we issued a standalone AD, which performing a repair in the area and not includes terminating action for the also accomplishing the modification. There are approximately 700 Model repetitive inspection requirements of The FAA does not concur. We point DC–9–10, –20, –30, –40, and –50 series AD 85–01–02 R1. Once a final rule has out that it is unnecessary to include a airplanes; and C–9 airplanes of the been issued and becomes effective, we reference to a service bulletin unless the affected design in the worldwide fleet. plan to rescind AD 85–01–02 R1. After specified procedures are required by the The FAA estimates that 397 airplanes of considering the commenter’s two proposed rule. Because the procedures U.S. registry will be affected by this AD. questions, we infer that the commenter specified in DC–9 Service Bulletin A53– It will take approximately 5 work wants us to clarify how previously 144 are not required by the final rule, hours per airplane to accomplish the issued ADs affect the compliance times no change to the final rule is necessary required inspections, and that the in follow-on ADs. In response, we point in this regard. average labor rate is $60 per work hour. out that AD 80–10–03 was superseded Based on these figures, the cost impact by AD 85–01–02, which removed AD Explanation of Changes Made to the of the AD on U.S. operators is estimated 80–10–03 from the regulations. As a Proposal to be $119,100, or $300 per airplane. result, the concurrent service bulletin The FAA has determined that it is For certain airplanes, it will take procedures required by AD 80–10–03 necessary to revise the final rule and has approximately between 21 and 26 work are no longer in effect. Likewise, after made the following changes: hours per airplane depending on the AD 85–01–02 R1 is rescinded, the • In the ‘‘Cost Impact’’ section, we airplane configuration to accomplish the compliance times required by that AD have clarified that 5 work hours per modification specified in McDonnell per the service bulletins are no longer a airplane is required for accomplishment Douglas DC–9 Service Bulletin 53–165, factor. No change to the final rule is of the required ‘‘inspections’’ instead of Revision 3, dated May 3, 1989, at an necessary in this regard. the required ‘‘actions.’’ average labor rate of $60 per work hour. • Paragraph (a) specifies that the Required parts will cost approximately Request To Include Additional requirements of that paragraph also between $3,470 and $11,831 per Corrective Actions apply to airplanes on which the airplane, depending on the airplane The commenter states that the modification has not been accomplished configuration. Based on these figures, proposed rule needs to address what per paragraph (g) of this AD, which the cost impact of this modification on happens if an operator finds ‘‘something specifies terminating action for the U.S. operators is estimated to be on a corner of an airplane’’ that they are repetitive inspections required by between $4,730, or $13,391 per airplane. unable to inspect per Revision 07 of paragraphs (b) and (c) of this AD. This For certain airplanes, it will take Service Bulletin DC9–53–137. The change clarifies that if the specified approximately 9 work hours per
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airplane to accomplish the modification PART 39—AIRWORTHINESS 53–137, Revision 07, dated February 6, 2001, specified in McDonnell Douglas DC–9 DIRECTIVES as applicable: Service Bulletin 53–157, Revision 1, (1) If interim preventive repairs have been dated January 7, 1985, at an average 1. The authority citation for part 39 performed per the service bulletin; AD 85– continues to read as follows: 01–02 R1 or AD 96–10–11: Do a visual labor rate of $60 per work hour. Based inspection and an eddy current inspection at on these figures, the cost impact of this Authority: 49 U.S.C. 106(g), 40113, 44701. the times specified in the service bulletin. modification on U.S. operators is § 39.13 [Amended] Repeat the applicable repetitive inspections estimated to be $540 per airplane. at intervals not to exceed the times specified 2. Section 39.13 is amended by in the service bulletin, until accomplishment The cost impact figures discussed adding the following new airworthiness of the action required by paragraph (d) or (g) above are based on assumptions that no directive: of this AD; or operator has yet accomplished any of (2) If interim preventive repairs have NOT 2002–07–06 McDonnell Douglas: the requirements of this AD action, and been performed per the service bulletin, do Amendment 39–12700. Docket 2000– either paragraph (b)(2)(i) or (b)(2)(ii) of this that no operator would accomplish NM–324–AD. those actions in the future if this AD AD: Applicability: Model DC–9–10, –20, –30, (i) Before further flight, install an interim were not adopted. The cost impact –40, and –50 series airplanes, and C–9 figures discussed in AD rulemaking preventive repair identified in Conditions I airplanes; certificated in any category; through XLIII inclusive, excluding actions represent only the time equipped with a floor level hinged (ventral) Conditions XXI, XXXVII, and XXXVIII (not necessary to perform the specific actions door of the aft pressure bulkhead; as listed used at this time), per the service bulletin. At actually required by the AD. These in McDonnell Douglas Service Bulletin DC9– the times specified in the service bulletin, do figures typically do not include 53–137, Revision 07, dated February 6, 2001; a visual inspection and an eddy current incidental costs, such as the time except for those airplanes on which the inspection. At intervals not to exceed the required to gain access and close up, modification required by paragraph (d) or (e) times specified in the service bulletin, repeat of AD 96–10–11, amendment 39–9618, or the visual and eddy current inspections until planning time, or time necessitated by paragraph K. of AD 85–01–02 R1, other administrative actions. accomplishment of the action specified in amendment 39–5241, has been done. paragraph (d) or (g) of this AD; or Regulatory Impact Note 1: This AD applies to each airplane (ii) At intervals not to exceed the times identified in the preceding applicability specified in the service bulletin, repeat the The regulations adopted herein will provision, regardless of whether it has been visual inspection and x-ray inspection not have a substantial direct effect on otherwise modified, altered, or repaired in required by paragraph (a) of this AD, until the States, on the relationship between the area subject to the requirements of this accomplishment of the action specified in the national Government and the States, AD. For airplanes that have been modified, paragraph (d) or (g) of this AD. altered, or repaired so that the performance Any Crack Detected: Corrective Actions and or on the distribution of power and of the requirements of this AD is affected, the Repetitive Inspections responsibilities among the various owner/operator must request approval for an levels of government. Therefore, it is alternative method of compliance in (c) If any crack is detected during any determined that this final rule does not accordance with paragraph (i)(1) of this AD. inspection required by paragraph (a) or (b) of have federalism implications under The request should include an assessment of this AD, do the actions specified in Executive Order 13132. the effect of the modification, alteration, or paragraphs (c)(1) and (c)(2) of this AD per repair on the unsafe condition addressed by McDonnell Douglas Service Bulletin DC9– For the reasons discussed above, I this AD; and, if the unsafe condition has not 53–137, Revision 07, dated February 6, 2001. certify that this action (1) is not a been eliminated, the request should include (1) Before further flight, do the applicable ‘‘significant regulatory action’’ under specific proposed actions to address it. corrective actions (i.e., modification of the Executive Order 12866; (2) is not a Compliance: Required as indicated, unless bulkhead; trim forward facing flange; stop ‘‘significant rule’’ under DOT accomplished previously. drill ends of cracks; install repair kit; Regulatory Policies and Procedures (44 To detect and correct fatigue cracks in the replacement of cracked part with new parts; and install additional doublers) identified in FR 11034, February 26, 1979); and (3) corners and upper center of the door cutout of the aft pressure bulkhead, which could Conditions I through XLIII inclusive, will not have a significant economic excluding Conditions XXI, XXXVII, and impact, positive or negative, on a result in rapid decompression of the fuselage and consequent reduced structural integrity XXXVIII (not used at this time), of the substantial number of small entities of the airplane, accomplish the following: Accomplishment Instructions of the service under the criteria of the Regulatory bulletin; and Flexibility Act. A final evaluation has Visual and X-Ray Inspection (2) At the times specified in the been prepared for this action and it is (a) For airplanes on which the modification Accomplishment Instructions of the service contained in the Rules Docket. A copy has NOT been accomplished per paragraph bulletin, do the applicable repetitive (g) of this AD: Except as provided by inspections, until accomplishment of the of it may be obtained from the Rules action specified in paragraph (d) or (g) of this Docket at the location provided under paragraph (h) of this AD, prior to the accumulation of 15,000 total landings, or AD. the caption ADDRESSES. within 4,000 landings after the effective date Concurrent Requirements List of Subjects in 14 CFR Part 39 of this AD, whichever occurs later, do a visual inspection and an x-ray inspection to (d) Except as provided by paragraph (h) of this AD, modify the ventral aft pressure Air transportation, Aircraft, Aviation detect cracks of the upper and lower corners and upper center of the door cutout of the aft bulkhead structure by accomplishing all safety, Incorporation by reference, actions specified in the Accomplishment Safety. pressure bulkhead, per McDonnell Douglas Service Bulletin DC9–53–137, Revision 07, Instructions of McDonnell Douglas DC–9 dated February 6, 2001. Service Bulletin 53–165, Revision 3, dated Adoption of the Amendment May 3, 1989, per the service bulletin; at the No Crack Detected: Repetitive Inspections applicable time specified in paragraph (d)(1), Accordingly, pursuant to the (b) If no crack is detected during any (d)(2), or (d)(3) of this AD. authority delegated to me by the inspection required by paragraph (a) of this Note 2: Modification before the effective Administrator, the Federal Aviation AD, do the action specified in either date of this AD per McDonnell Douglas DC– Administration amends part 39 of the paragraph (b)(1) or (b)(2) of this AD per 9 Service Bulletin 53–165, dated January 31, Federal Aviation Regulations (14 CFR paragraph 3.B. ‘‘Work Instructions’’ of 1983; Revision 1, dated February 20, 1984; or part 39) as follows: McDonnell Douglas Service Bulletin DC9– Revision 2, dated August 29, 1986; is
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considered acceptable for compliance with Exception to Inspections and Modifications Effective Date the requirements of paragraph (d) of this AD. (h) As of the effective date of this AD, the (l) This amendment becomes effective on (1) For airplanes on which the bulkhead inspections and modifications required by May 14, 2002. modification specified in McDonnell Douglas this AD do NOT need to be done during any Issued in Renton, Washington, on March DC–9 Service Bulletin 53–139, dated period that the airplane is operated without 28, 2002. September 26, 1980, or Revision 1, dated cabin pressurization and a placard is Kalene C. Yanamura, April 30, 1981, has been done, except as installed in the cockpit in full view of the provided by paragraph (d)(3) of this AD: pilot that states the following: ‘‘OPERATION Acting Manager, Transport Airplane Modify within 15,000 landings after WITH CABIN PRESSURIZATION IS Directorate, Aircraft Certification Service. accomplishment of the bulkhead PROHIBITED.’’ [FR Doc. 02–8279 Filed 4–8–02; 8:45 am] modification, or within 4,000 landings after BILLING CODE 4910–13–P the effective date of this AD, whichever Alternative Methods of Compliance (AMOC) occurs later. Accomplishment of this (i)(1) An AMOC or adjustment of the modification constitutes terminating action compliance time that provides an acceptable DEPARTMENT OF TRANSPORTATION for the repetitive inspection requirements of level of safety may be used if approved by paragraphs (b) and (c)(2) of this AD. the Manager, Los Angeles Aircraft Federal Aviation Administration (2) For airplanes on which the production Certification Office (ACO), FAA. Operators equivalent of the modification specified in shall submit their requests through an 14 CFR Part 39 paragraph (d)(1) of this AD has been done appropriate FAA Principal Maintenance before delivery, except as provided by Inspector, who may add comments and then [Docket No. 2002–NM–30–AD; Amendment paragraph (d)(3) of this AD: Modify before send it to the Manager, Los Angeles ACO. 39–12701; AD 2002–07–07] the accumulation of 15,000 total landings, or (2) AMOCs approved previously in RIN 2120–AA64 within 4,000 landings after the effective date accordance with AD 85–01–02 R1, of this AD, whichever occurs later. amendment 39–4978; or AD 96–10–11, Airworthiness Directives; Boeing Accomplishment of this modification amendment 39–9618; are approved as Model 777–200 Series Airplanes constitutes terminating action for the AMOCs for paragraph (a) or (c) of this AD, repetitive inspection requirements of as appropriate. Equipped With General Electric GE90 paragraphs (b) and (c)(2) of this AD. (3) An AMOC for any inspection required Series Engines by paragraph (a) or (c) of this AD that (3) For airplanes listed in McDonnell AGENCY: Federal Aviation provides an acceptable level of safety may be Douglas DC–9 Service Bulletin 53–165, Administration, DOT. Revision 3, dated May 3, 1989, that are used per data meeting the type certification specified in paragraph (e) of this AD: Modify basis of the airplane approved by a Boeing ACTION: Final rule; request for in conjunction with the requirements of Company Designated Engineering comments. paragraph (e) of this AD, or within 18 months Representative who has been authorized by after accomplishment of the requirements of the Manager, Los Angeles ACO, to make such SUMMARY: This amendment adopts a paragraph (e) of this AD. findings. new airworthiness directive (AD) that is applicable to certain Boeing Model 777– Modification: Ventral Aft Pressure Bulkhead Note 4: Information concerning the existence of approved AMOCs with this AD, 200 series airplanes equipped with (e) For Model DC–9–30 and ‘‘50 series if any, may be obtained from the Los Angeles General Electric GE90 series engines. airplanes, and C–9 airplanes, as listed in ACO. This action requires repetitive McDonnell Douglas DC–9 Service Bulletin inspections of the diagonal brace and 53–157, Revision 1, dated January 7, 1985: Special Flight Permit forward seals of the aft fairing of the Except as provided by paragraph (h) of this (j) Special flight permits may be issued in strut to find discrepancies, and AD, within 18 months after the effective date accordance with §§ 21.197 and 21.199 of the corrective actions, if necessary. This of this AD, modify the ventral aft pressure Federal Aviation Regulations (14 CFR 21.197 bulkhead per the service bulletin. action is necessary to prevent primary and 21.199) to operate the airplane to a engine exhaust from entering the aft Note 3: Modification before the effective location where the requirements of this AD fairing of the strut and elevating the date of this AD per McDonnell Douglas DC– can be accomplished. 9 Service Bulletin 53–157, dated August 11, temperature, which could lead to heat 1981, is considered acceptable for Incorporation by Reference damage of the seals and diagonal brace. compliance with the requirements of (k) The actions shall be done in accordance Such damage could result in cracking paragraph (e) of this AD. with McDonnell Douglas Service Bulletin and fracture of the forward attachment DC9–53–137, Revision 07, dated February 6, point of the diagonal brace, loss of the Compliance with AD 85–01–02 R1 2001; McDonnell Douglas DC–9 Service diagonal brace load path, and (f) Accomplishment of the visual and x-ray Bulletin 53–165, Revision 3, dated May 3, consequent separation of the strut and inspections required by paragraph (a) of this 1989; and McDonnell Douglas DC–9 Service engine from the airplane. This action is AD constitutes terminating action for the Bulletin 53–157, Revision 1, dated January 7, intended to address the identified repetitive inspection requirements of AD 85– 1985; as applicable. This incorporation by unsafe condition. 01–02 R1. reference was approved previously by the Director of the Federal Register in accordance DATES: Effective April 24, 2002. Terminating Modification with 5 U.S.C. 552(a) and 1 CFR part 51. The incorporation by reference of (g) Accomplishment of the modification Copies may be obtained from Boeing certain publications listed in the (reference McDonnell Douglas DC–9 Service Commercial Aircraft Group, Long Beach regulations is approved by the Director Bulletin 53–166) required by paragraph (d) or Division, 3855 Lakewood Boulevard, Long of the Federal Register as of April 24, (e) of AD 96–10–11 (which references ‘‘DC– Beach, California 90846, Attention: Data and 2002. 9/MD–80 Aging Aircraft Service Action Service Management, Dept. C1–L5A (D800– Comments for inclusion in the Rules Requirements Document’’ (SARD), 0024). Copies may be inspected at the FAA, Docket must be received on or before McDonnell Douglas Report No. MDC K1572, Transport Airplane Directorate, 1601 Lind June 10, 2002. Revision A, dated June 1, 1990; or Revision Avenue, SW., Renton, Washington; or at the B, dated January 15, 1993; as the appropriate FAA, Los Angeles Aircraft Certification ADDRESSES: Submit comments in source of service information for Office, 3960 Paramount Boulevard, triplicate to the Federal Aviation accomplishing the modification) terminates Lakewood, California; or at the Office of the Administration (FAA), Transport the repetitive inspection requirements of Federal Register, 800 North Capitol Street, Airplane Directorate, ANM–114, paragraphs (b) and (c) of this AD. NW., suite 700, Washington, DC. Attention: Rules Docket No. 2002-NM–
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30–AD, 1601 Lind Avenue, SW., consequent separation of the strut and than 42.5 percent and less than or equal Renton, Washington 98055–4056. engine from the airplane. to 44 percent IACS), Part 2 specifies Comments may be inspected at this inspecting the strut to wing attachments Related Rulemaking location between 9:00 a.m. and 3:00 and reworking if additional damage is p.m., Monday through Friday, except In light of this AD, the FAA is found, and within 18 months, replacing Federal holidays. Comments may be considering withdrawing Notice of the diagonal brace. If the conductivity submitted via fax to (425) 227–1232. Proposed Rulemaking (NPRM) 2001– limit is greater than 44 percent IACS, Comments may also be sent via the NM–93–AD (66 FR 54727, October 30, Part 2 specifies immediately replacing Internet using the following address: 9- 2001). That NPRM proposed to require the diagonal brace. If the diagonal brace [email protected]. Comments installation of a high temperature is within the specified limits, Part 2 sent via fax or the Internet must contain silicone foam seal to fill the gap in the specifies repeating the Part 1 inspection. ‘‘Docket No. 2002-NM–30-AD’’ in the strut aft fairing fire seal and firewall. • Part 3 of the service bulletin subject line and need not be submitted Since the issuance of that NPRM, the specifies replacing any damaged seal in triplicate. Comments sent via the FAA has received new information that (primary fire seal, heat shield seal, or Internet as attached electronic files must indicates that the unsafe condition secondary fluid seal, with a new seal), be formatted in Microsoft Word 97 for would not be prevented by the then repeating the Part 1 inspection. Windows or ASCII text. installation of the high temperature Part 3 also specifies contacting Boeing silicone foam seal alone. Of primary for alternate repair instructions for the The service information referenced in importance is the integrity of the this AD may be obtained from Boeing seals. existing primary fire, heat shield, and • Part 4 of the service bulletin Commercial Airplane Group, P.O. Box secondary fluid seals to prevent heat specifies replacing any damaged 3707, Seattle, Washington 98124–2207. damage to the diagonal brace. This AD diagonal brace with a new brace, then This information may be examined at is being issued to require the inspection repeating the Part 1 inspection. the FAA, Transport Airplane and maintenance of those existing seals, We also have reviewed and approved Directorate, 1601 Lind Avenue, SW., in addition to the inspection and Boeing All Operator Message M–7200– Renton, Washington; or at the Office of maintenance of the diagonal brace. The 02–00173, dated January 30, 2002, the Federal Register, 800 North Capitol installation of the high temperature which describes procedures for a Street, NW., suite 700, Washington, DC. silicone foam seal recommended in temporary repair of the forward seals of FOR FURTHER INFORMATION CONTACT: John Boeing Service Bulletin 777–54A0015, the aft fairing of the strut. Vann, Aerospace Engineer, Propulsion dated January 18, 2001 (referenced in the NPRM as the appropriate source of Explanation of the Requirements of the Branch, ANM–140S, FAA, Seattle Rule Aircraft Certification Office, 1601 Lind service information for accomplishment Avenue, SW., Renton, Washington of the specified actions), is not currently Since an unsafe condition has been 98055–4056; telephone (425) 227–1024; being mandated, and the FAA is identified that is likely to exist or fax (425) 227–1181. considering withdrawal of the NPRM. develop on other airplanes of the same type design, this AD requires SUPPLEMENTARY INFORMATION: The FAA Explanation of Relevant Service accomplishment of the actions specified has received reports that, during routine Information in the service information described inspections of the aft fairing of the strut, The FAA has reviewed and approved previously, except as discussed below. evidence of an elevated temperature in Boeing Alert Service Bulletin 777– the interior cavity of the aft fairing has 54A0017, dated December 21, 2001, Differences Between This AD and the been found on several Boeing Model which describes the following Alert Service Bulletin 777–200 series airplanes equipped with procedures: Part 2 of the referenced service General Electric GE90 series engines. • Part 1 of the service bulletin bulletin specifies a compliance time of One operator reported significant heat specifies repetitive detailed inspections 18 months for replacement of the damage to the forward end of the of the diagonal brace and forward seals diagonal brace if the brace is not within diagonal brace on the left strut of a of the aft fairing of the strut to find the specified conductivity limits (greater General Electric GE90 powered airplane. discrepancies, and corrective actions, if than 42.5 percent and less than or equal The diagonal brace material is necessary. The discrepancies include to 44 percent IACS); however, this AD aluminum 7075–T73, with a specified heat damage to the diagonal brace and/ requires the replacement be done within conductivity range of 38.0 through 42.5 or forward seals, and cracks and/or 90 days after the initial conductivity percent International Annealed Copper fracture of the diagonal brace. Part 1 inspection if the brace is not within the Standard (IACS). The damaged brace also specifies either replacing the specified conductivity limits. assembly had a conductivity reading of diagonal brace per Part 4 of the service In developing an appropriate 47 percent IACS. Investigation revealed bulletin if any crack or fracture is found, compliance time for this AD, the FAA that the damage was caused by primary or contacting Boeing for rework considered not only the manufacturer’s engine exhaust entering the aft fairing of instructions. recommendation, but the degree of the strut through a gap in the heat shield • If necessary, due to findings from urgency associated with addressing the and elevating the temperature, resulting the detailed inspection specified in Part subject unsafe condition, the average in heat damage to the primary fire seal, 1 of the service bulletin, Part 2 of the utilization of the affected fleet, and the heat shield seal, and secondary fluid service bulletin specifies a conductivity time necessary to perform the seal. The damaged seals allowed the inspection to verify the conductivity of modifications. In light of all of these exhaust to pass into the aft fairing cavity the diagonal brace material. If the factors, the FAA finds a compliance causing heat damage to the diagonal diagonal brace is within the specified time of 90 days for completing the brace assembly. Such damage, if not conductivity limits (38.0 through 42.5 replacement to be warranted, in that it found and fixed, could result in percent IACS), the detailed inspection represents an appropriate interval of cracking and fracture of the forward specified in Part 1 is repeated. If the time allowable for affected airplanes to attachment point of the diagonal brace, diagonal brace is not within the continue to operate without loss of the diagonal brace load path, and specified conductivity limits (greater compromising safety.
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The service bulletin also specifies that action and determining whether List of Subjects in 14 CFR Part 39 all actions for which the Boeing 777 additional rulemaking action would be Air transportation, Aircraft, Aviation Airplane Maintenance Manual (AMM) needed. safety, Incorporation by reference, is specified as the appropriate source of Submit comments using the following Safety. service information for work format: Adoption of the Amendment instructions may instead be done • Organize comments issue-by-issue. according to an ‘‘operator’s equivalent For example, discuss a request to Accordingly, pursuant to the procedure.’’ However, the FAA finds change the compliance time and a authority delegated to me by the that Chapter 54–54–03 of the AMM request to change the service bulletin Administrator, the Federal Aviation must be used to accomplish the reference as two separate issues. Administration amends part 39 of the inspection of the forward seals of the aft • For each issue, state what specific Federal Aviation Regulations (14 CFR fairing of the strut for signs of heat part 39) as follows: damage, which is specified in the Work change to the AD is being requested. • Instructions in the service bulletin. For Include justification (e.g., reasons or PART 39—AIRWORTHINESS this inspection, an ‘‘operator’s data) for each request. DIRECTIVES equivalent procedure’’ may be used only Comments are specifically invited on if approved as an alternative method of the overall regulatory, economic, 1. The authority citation for part 39 compliance per paragraph (c) of this AD. environmental, and energy aspects of continues to read as follows: Although the service bulletin the rule that might suggest a need to Authority: 49 U.S.C. 106(g), 40113, 44701. specifies that the manufacturer may be modify the rule. All comments contacted for disposition of certain submitted will be available, both before § 39.13 [Amended] rework/repairs, this proposed AD would and after the closing date for comments, 2. Section 39.13 is amended by require all rework/repairs to be in the Rules Docket for examination by adding the following new airworthiness accomplished per a method approved interested persons. A report that directive: by the FAA, or per data meeting the summarizes each FAA-public contact 2002–07–07 Boeing: Amendment 39–12701. type certification basis of the airplane concerned with the substance of this AD Docket 2002–NM–30–AD. approved by a Boeing Company will be filed in the Rules Docket. Applicability: Model 777–200 series Designated Engineering Representative Commenters wishing the FAA to airplanes equipped with General Electric who has been authorized by the acknowledge receipt of their comments GE90 series engines, as listed in Boeing Alert Manager, Seattle Aircraft Certification submitted in response to this rule must Service Bulletin 777–54A0017, dated Office, to make such findings. December 21, 2001, certificated in any submit a self-addressed, stamped category. postcard on which the following Interim Action Note 1: This AD applies to each airplane statement is made: ‘‘Comments to identified in the preceding applicability This is considered to be interim Docket Number 2002–NM–30–AD.’’ The action until final action is identified, at provision, regardless of whether it has been postcard will be date stamped and modified, altered, or repaired in the area which time the FAA may consider returned to the commenter. subject to the requirements of this AD. For further rulemaking. airplanes that have been modified, altered, or Regulatory Impact Determination of Rule’s Effective Date repaired so that the performance of the The regulations adopted herein will requirements of this AD is affected, the Since a situation exists that requires owner/operator must request approval for an the immediate adoption of this not have a substantial direct effect on alternative method of compliance in regulation, it is found that notice and the States, on the relationship between accordance with paragraph (c) of this AD. opportunity for prior public comment the national Government and the States, The request should include an assessment of hereon are impracticable, and that good or on the distribution of power and the effect of the modification, alteration, or cause exists for making this amendment responsibilities among the various repair on the unsafe condition addressed by this AD; and, if the unsafe condition has not effective in less than 30 days. levels of government. Therefore, it is determined that this final rule does not been eliminated, the request should include Comments Invited have federalism implications under specific proposed actions to address it. Although this action is in the form of Executive Order 13132. Compliance: Required as indicated, unless accomplished previously. a final rule that involves requirements The FAA has determined that this To prevent heat damage of the diagonal affecting flight safety and, thus, was not regulation is an emergency regulation brace and forward seals of the aft fairing of preceded by notice and an opportunity that must be issued immediately to the strut, which could result in cracking and for public comment, comments are correct an unsafe condition in aircraft, fracture of the forward attachment point of invited on this rule. Interested persons and that it is not a ‘‘significant the diagonal brace, loss of the diagonal brace are invited to comment on this rule by regulatory action’’ under Executive load path, and consequent separation of the submitting such written data, views, or Order 12866. It has been determined strut and engine from the airplane; arguments as they may desire. further that this action involves an accomplish the following: Communications shall identify the emergency regulation under DOT Repetitive Inspections Rules Docket number and be submitted Regulatory Policies and Procedures (44 (a) Within 500 flight hours after the in triplicate to the address specified FR 11034, February 26, 1979). If it is effective date of this AD: Do a detailed under the caption ADDRESSES. All determined that this emergency inspection of the diagonal brace and forward communications received on or before regulation otherwise would be seals of the aft fairing of the strut to find the closing date for comments will be significant under DOT Regulatory discrepancies (heat damage to the diagonal considered, and this rule may be Policies and Procedures, a final brace and/or forward seals, and cracks and/ or fracture of the diagonal brace), per Part 1 amended in light of the comments regulatory evaluation will be prepared of the Accomplishment Instructions of received. Factual information that and placed in the Rules Docket. A copy Boeing Alert Service Bulletin 777–54A0017, supports the commenter’s ideas and of it, if filed, may be obtained from the dated December 21, 2001. If no discrepancies suggestions is extremely helpful in Rules Docket at the location provided are found, repeat the inspection after that evaluating the effectiveness of the AD under the caption ADDRESSES. every 1,000 flight hours.
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Corrective Actions (AOM) M–7200–02–00173, dated January 30, Effective Date (1) If any sign of heat damage to the 2002. Do the repair within 500 flight hours (f) This amendment becomes effective on diagonal brace is found: Before further flight, after the initial inspection required by April 24, 2002. do the conductivity inspection of all areas of paragraph (a) of this AD, or do the Issued in Renton, Washington, on March the forward clevis lugs and brace body of the replacement within 1,000 flight hours after 29, 2002. diagonal brace, as specified in and per Part that initial inspection, as applicable. If the 2 of the Accomplishment Instructions of the temporary repair is done, inspect the Ali Bahrami, service bulletin. repaired seal every 500 flight hours until the Acting Manager, Transport Airplane (i) If the conductivity readings are all seal is replaced. Replacement of the seal Directorate, Aircraft Certification Service. within the specified range of 38.0 through must be done within 1,000 flight hours after [FR Doc. 02–8280 Filed 4–8–02; 8:45 am] 42.5 percent International Annealed Copper the repair is done. BILLING CODE 4910–13–P Standard (IACS); then repeat the inspection (ii) If there is damage to any seal and required by paragraph (a) of this AD every leakage of the seal is found, before further 1,000 flight hours. flight, do the replacement or temporary DEPARTMENT OF TRANSPORTATION (ii) If any conductivity readings are within repair of the seal per the AOM. If the the specified range of greater than 42.5 temporary repair is done, inspect the Federal Aviation Administration percent and less than or equal to 44 percent repaired seal every 250 flight hours until the IACS, before further flight, do the inspection seal is replaced. Replacement of the seal specified in and per Part 2 of the 14 CFR Part 39 must be done within 1,000 flight hours after Accomplishment Instructions of the service the repair is done. bulletin. If additional damage is found, repair [Docket No. 2001–NE–16–AD; Amendment per a method approved by the Manager, ‘‘Operator’s Equivalent Procedure’’ 39–12698; AD 2002–07–04] Seattle Aircraft Certification Office (ACO), (b) Though Boeing Alert Service Bulletin RIN 2120–AA64 FAA, or per data meeting the type certification basis of the airplane approved 777–54A0017, dated December 21, 2001, by a Boeing Company Designated specifies that an ‘‘operator’s equivalent Airworthiness Directives; Pratt & Engineering Representative (DER) who has procedure’’ may be used for the inspection of Whitney JT9D–7R4 Series Turbofan been authorized by the Manager, Seattle the forward seals of the aft fairing of the strut Engines ACO, to make such findings. For a repair for signs of heat damage, that inspection method to be approved by the Manager, must be done according to Chapter 54–54–03 AGENCY: Federal Aviation Seattle ACO, as required by this paragraph, of the Boeing 777 Airplane Maintenance Administration, DOT. the Manager’s approval letter must Manual, as specified in the service bulletin. ACTION: Final rule. specifically reference this AD. Within 90 Alternative Methods of Compliance days after doing the conductivity inspection, SUMMARY: This amendment adopts a replace the diagonal brace with a new brace (c) An alternative method of compliance or new airworthiness directive (AD), that is per Part 4 of the Accomplishment adjustment of the compliance time that applicable to Pratt & Whitney (PW) provides an acceptable level of safety may be Instructions of the service bulletin. Then, JT9D–7R4 series turbofan engines. This repeat the inspection required by paragraph used if approved by the Manager, Seattle (a) of this AD every 1,000 flight hours. ACO. Operators shall submit their requests amendment requires a one-time (iii) If any conductivity readings are greater through an appropriate FAA Principal inspection of low pressure turbine (LPT) than 44 percent IACS, before further flight, Maintenance Inspector, who may add 5th stage disks for evidence of blend replace the diagonal brace per Part 4 of the comments and then send it to the Manager, repairs and mechanical damage, and Accomplishment Instructions of the service Seattle ACO. replacement of the affected disks based bulletin. Then, repeat the inspection required Note 2: Information concerning the on the extent of those repairs and by paragraph (a) of this AD every 1,000 flight existence of approved alternative methods of damage. This amendment is prompted hours. compliance with this AD, if any, may be by a report of a PW JT9D–7R4G2 (2) If any crack or fracture of the diagonal obtained from the Seattle ACO. turbofan engine that experienced an brace is found, before further flight, replace uncontained failure of the LPT 5th stage the diagonal brace with a new brace per Part Special Flight Permits 4 of the Accomplishment Instructions of the disk. The actions specified by this AD service bulletin; or rework the diagonal brace (d) Special flight permits may be issued in are intended to prevent uncontained per a method approved by the Manager, accordance with §§ 21.197 and 21.199 of the failure of the LPT 5th stage disk, due to Seattle ACO, or per data meeting the type Federal Aviation Regulations (14 CFR 21.197 incomplete blend repairs, resulting in certification basis of the airplane approved and 21.199) to operate the airplane to a location where the requirements of this AD in-flight shutdown and damage to the by a Boeing Company DER who has been airplane. authorized by the Manager, Seattle ACO, to can be accomplished. make such findings. For a repair method to Incorporation by Reference DATES: Effective date May 14, 2002. The be approved by the Manager, Seattle ACO, as incorporation by reference of certain required by this paragraph, the Manager’s (e) Except as provided by paragraphs publications listed in the regulations is approval letter must specifically reference (a)(1)(ii), (a)(2), and (b) of this AD, the actions shall be done in accordance with Boeing approved by the Director of the Federal this AD. Then, repeat the inspection required Register as of May 14, 2002. by paragraph (a) of this AD every 1,000 flight Alert Service Bulletin 777–54A0017, dated hours. December 21, 2001; and Boeing All Operator ADDRESSES: The service information (3) If any sign of heat damage to any seal Message M–7200–02–00173, dated January referenced in this AD may be obtained is found, before further flight, replace the seal 30, 2002; as applicable. This incorporation by from Pratt & Whitney, 400 Main St., East per Part 3 of the Accomplishment reference was approved by the Director of the Hartford, CT 06108; telephone (860) Instructions of the service bulletin, or do the Federal Register in accordance with 5 U.S.C. 565–8770; fax (860) 565–4503. This actions required by paragraph (a)(3)(i) or 552(a) and 1 CFR part 51. Copies may be information may be examined, by (a)(3)(ii) of this AD, as applicable. Then, obtained from Boeing Commercial Airplane appointment, at the Federal Aviation Group, P.O. Box 3707, Seattle, Washington repeat the inspection required by paragraph Administration (FAA), New England (a) of this AD every 1,000 flight hours. 98124–2207. Copies may be inspected at the (i) If there is any damage to any seal but FAA, Transport Airplane Directorate, 1601 Region, Office of the Regional Counsel, no leakage of the seal is found, do a detailed Lind Avenue, SW., Renton, Washington; or at 12 New England Executive Park, inspection of the seal every 50 flight hours the Office of the Federal Register, 800 North Burlington, MA; or at the Office of the until the replacement or temporary repair is Capitol Street, NW., suite 700, Washington, Federal Register, 800 North Capitol done per Boeing All Operator Message DC. Street, NW, suite 700, Washington, DC.
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FOR FURTHER INFORMATION CONTACT: Tara failure during operation. Operators may JT9D–7R4–72–574. A tiebolt fracture Goodman, Aerospace Engineer, Engine request case-by-case review using the during operation is capable of damaging Certification Office, FAA, Engine and procedure to request an Alternative the aft side of the disk in the web and Propeller Directorate, 12 New England Methods of Compliance, paragraph (c). bore areas. The FAA expects operators Office Park, Burlington, MA 01803– to use good maintenance practices to Use the Same Wording as the Service 5299; telephone (781) 238–7130, fax Bulletin prevent damage to disks during LPT (781) 238–7199. disassembly. If damage occurs during SUPPLEMENTARY INFORMATION: A One commenter requests that the FAA disassembly, the Engine Manual must proposal to amend part 39 of the Federal use the same wording in the compliance be used to determine serviceability. Aviation Regulations (14 CFR part 39) to instructions for the AD as that which is Concern for Engine Manual Revision include an AD that is applicable to PW contained in PW Service Bulletin (SB) JT9D–7R4 series turbofan engines was JT9D–7R4–72–574. Paragraph (a)(1) of One commenter expresses concern published in the Federal Register on the proposal states: ‘‘remove from that neither the proposal nor PW SB August 30, 2001 (66 FR 45789). That service those LPT 5th stage disks that JT9D–7R4–72–574 indicate that the action proposed to require a one-time were installed in engines that Engine Manual-provided blend repair inspection of low pressure turbine (LPT) experienced a tiebolt fracture AND are (Section 72–52–11, Repair-01 for JT9D– 5th stage disks for evidence of blend found with blended or unblended 7R4G2 Engines) will be revised to repairs and mechanical damage, and damage in the web and bore areas, and effectively address the tiebolt failure replacement of the affected disks based replace with a serviceable disk.’’ In mode and cause. The compliance in the on the extent of those repairs and place of the AND above, the SB uses the proposal does not prevent future damage, in accordance with PW service word OR. Using the word AND, implies blending of the disk web and bore when bulletin (SB) JT9D–7R4–72–574, that the final rule would require both the disk is routed for repair after the Revision 1, dated June 26, 2001. tiebolt fracture history and damage to one-time mandated visual inspection meet replacement criteria. has been completed. The commenter Comments The FAA disagrees that any change to requests that the Engine Manual blend Paragrap (a)(1) is necessary, but agrees Interested persons have been afforded repair be referenced in the final rule. that the final rule could be worded an opportunity to participate in the The FAA agrees that the AD and the making of this amendment. Due clearer. Paragraph (a)(1) of the proposal covered those disks for which the Engine Manual should address future consideration has been given to the situations where the one-time mandated comments received. operator knew that the damage was due to tiebolt failure. Paragraph (a)(2) of the visual inspections are completed. The Clarification of Areas To Be Inspected proposal covers those disks for which manufacturer will include a One commenter states that the areas the tiebolt fracture history is unknown. requirement in the Engine Manual to of inspection are not defined for the The FAA has changed final rule remove from service any LPT 5th stage requirement to remove disks with five paragraph (a)(1) to clarify that it applies disk that experienced damage to the fore or more blended or unblended areas of to disks for which there is a known and aft web and bore areas from a damage by any cause. By not defining history of tiebolt failure in operation. fractured tiebolt during operation. The the areas of inspection, blends or areas intent of the AD is to specify a one-time Exclude Damage Caused by Tierod of damage anywhere on the disk could inspection of LPT 5th stage disks. In be counted. The commenter states that Removal addition, the AD will more clearly state blends to remove part markings such as One commenter states that many in paragraph (b) of the compliance TT and TC marks or other blends on fir disks have tierod removal damage on section that any LPT 5th stage disk that trees, for example, should not be the rear side of the disk, due to tierod experiences damage to the fore and aft counted toward the five or more fracture during disassembly. The web and bore areas from a fractured rejection limit. commenter requests that damage found tiebolt during operation must be Another commenter requests on the rear side of the disk, that is in removed from service. The repair and clarification of whether a disk may be line with the tierod holes should not be serviceability requirements for LPT 5th returned to service after five or more taken into account because it is due to stage disks are not part of the AD. blended or unblended damage areas are tierod removal. The commenter requests Revision to Manufacturer’s Service found on the disk but all of the damage that alternate inspection requirements Information is identified as non-tiebolt damage. The be provided that identify the type of clarification is requested because the damage rather than the number of The manufacturer comments that blended areas or areas of damage called damaged areas. since the publication of the proposal, out in the NPRM are not specific. The The FAA partially agrees. The FAA Revision 2 of the SB has been commenter also asks if the agrees that the wording should include published, which provides a revised determination of acceptance of a disk the specification that the tierod damage Figure 2 and a consistent description of could be done on a case-by-case basis. occurs during operation. Therefore, the the one-time inspection rejection The FAA agrees that the proposal FAA has changed the wording in final criteria. does not specify where on the disk to rule paragraph (a)(1) to specify that the The FAA agrees and has added this look for blended areas or areas of damage must be due to tiebolt fracture SB Revision to the incorporation by damage. Therefore the FAA has changed during operation. This change is reference. paragraph (a)(2) of this final rule to justified because high-energy damage to After careful review of the available specify that the areas to be inspected are the disk caused by a tiebolt fracture data, including the comments noted the forward and aft web and bore areas. occurs during operation rather than above, the FAA has determined that air The FAA disagrees, however, that disks during LPT disassembly. However, the safety and the public interest require the with five or more areas of damage in the FAA does not agree that the type of adoption of the rule with the changes forward and aft web areas may be damage, as a result of tiebolt failure described previously. The FAA has returned to service, even if the damage during operation, should be specified determined that these changes will is known to be unrelated to a tiebolt differently than specified in PW SB neither increase the economic burden
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on any operator nor increase the scope List of Subjects in 14 CFR Part 39 Compliance of the AD. Compliance with this AD is required as Air transportation, Aircraft, Aviation indicated at the next separation of the LPT Economic Analysis safety, Incorporation by reference, module from the engine, unless already done. Safety. To prevent uncontained failure of the low There are approximately 647 Pratt & pressure turbine (LPT) 5th stage disk due to Whitney (PW) JT9D–7R4 series turbofan Adoption of the Amendment incomplete blend repairs, resulting in in- engines of the affected design in the flight shutdown and damage to the airplane, worldwide fleet. The FAA estimates that Accordingly, pursuant to the do the following: 151 engines installed on airplanes of authority delegated to me by the (a) Perform a one-time visual inspection for U.S. registry would be affected by this Administrator, the Federal Aviation evidence of blend repairs of LPT 5th stage disks, P/N’s 787905, 787905–001, and AD. The FAA also estimates that it Administration amends part 39 of the Federal Aviation Regulations (14 CFR 798305 in accordance with the would take approximately one work part 39) as follows: Accomplishment Instructions section of PW hour per engine to accomplish the service bulletin (SB) JT9D–7R4–72–574, proposed actions, and that the average PART 39—AIRWORTHINESS Revision 1, dated June 26, 2001, or SB JT9D– labor rate is $60 per work hour. A DIRECTIVES 7R4–72–574, Revision 2, dated January 21, replacement disk would cost 2002. approximately $145,260 per engine. (1) Remove from service those LPT 5th 1. The authority citation for part 39 stage disks that have any amount of blended Based on these figures, the total cost continues to read as follows: or unblended damage in the forward and aft effect of the AD on U.S. operators is Authority: 49 U.S.C. 106(g), 40113, 44701. web and bore areas, that was caused by a estimated to be $21,943,320. tiebolt fracture during operation, and replace § 39.13 [Amended] with a serviceable part. Regulatory Analysis (2) Remove from service LPT 5th stage 2. Section 39.13 is amended by disks that have five or more areas of blended This final rule does not have adding a new airworthiness directive to or unblended damage by any cause in the federalism implications, as defined in read as follows: forward and aft web and bore areas and Executive Order 13132, because it 2002–07–04 Pratt & Whitney: Amendment replace with a serviceable part. would not have a substantial direct 39–12698. Docket No. 2001–NE–16–AD. (b) After the effective date of this AD, do effect on the States, on the relationship not install any LPT module that contains an between the national government and Applicability LPT 5th stage disk, P/N 787905, 787905–001, or 798305 unless that disk has been This airworthiness directive (AD) is the States, or on the distribution of inspected as specified in paragraph (a) of this applicable to Pratt & Whitney (PW) JT9D– power and responsibilities among the AD. After the effective date of this AD, do not 7R4D, –7R4D1, –7R4E, –7R4E1, –7R4E4, various levels of government. install any LPT 5th stage disk that Accordingly, the FAA has not consulted –7R4G2, and 7R4H1 series turbofan engines experiences damage to the fore and aft web with LPT 5th stage disks, part numbers (P/ with state authorities prior to and bore areas from a fractured tiebolt during N’s) 787905, 787905–001, and 798305 operation. publication of this final rule. installed. These engines are installed on, but For the reasons discussed above, I not limited to Airbus Industrie A300 and Alternative Methods of Compliance certify that this action (1) is not a A310 series, and Boeing 747 and 767 series (c) An alternative method of compliance or ‘‘significant regulatory action’’ under airplanes. adjustment of the compliance time that Executive Order 12866; (2) is not a Note 1: This AD applies to each engine provides an acceptable level of safety may be ‘‘significant rule’’ under the DOT identified in the preceding applicability used if approved by the Manager, Engine provision, regardless of whether it has been Certification Office (ECO). Operators must Regulatory Policies and Procedures (44 modified, altered, or repaired in the area submit their request through an appropriate FR 11034, February 26, 1979); and (3) if subject to the requirements of this AD. For FAA Principal Maintenance Inspector, who promulgated, will not have a significant engines that have been modified, altered, or may add comments and then send it to the economic impact, positive or negative, repaired so that the performance of the Manager, ECO. on a substantial number of small entities requirements of this AD is affected, the Note 2: Information concerning the under the criteria of the Regulatory owner/operator must request approval for an existence of approved alternative methods of Flexibility Act. A final evaluation has alternative method of compliance in compliance with this airworthiness directive, if any, may be obtained from the ECO. been prepared for this action and it is accordance with paragraph (c) of this AD. The request should include an assessment of contained in the Rules Docket. A copy the effect of the modification, alteration, or Documents That Have Been Incorporated by of it may be obtained by contacting the repair on the unsafe condition addressed by Reference Rules Docket at the location provided this AD; and, if the unsafe condition has not (d) The inspection must be done in under the caption ADDRESSES. been eliminated, the request should include accordance with the following Pratt & specific proposed actions to address it. Whitney Service Bulletins (SB’s):
Document No. Pages Revision Date
SB JT9D–7R4–72–574 ...... All ...... 1 June 26, 2001. Total pages: 16 SB JT9D–7R4–72–574 ...... 1–3 ...... 2 January 21, 2002. 4–9 ...... 1 June 26, 2001. 10–12 ...... 2 January 21, 2002. 13 ...... 1 June 26, 2001. 14 ...... 2 January 21, 2002. 15–16 ...... 1 June 26, 2001. Total pages: 16
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This incorporation by reference was entities as defined by the Act, and does government not otherwise provided by approved by the Director of the Federal not impose any obligatory information law’’. However, Section 644a of Title 48 Register in accordance with 5 U.S.C. 552(a) requirements beyond internal Air Force of the U.S. Code extended the and 1 CFR part 51. Copies may be obtained use. The Department of the Air Force jurisdiction of the U.S. District Court for from Pratt & Whitney, 400 Main St., East proposed a revised Wake Island Code, the District of Hawaii to ‘‘all civil and Hartford, CT 06108; telephone (860) 565– 8770; fax (860) 565–4503. Copies may be consisting of Part 935 of Title 32 of the criminal cases arising on or within inspected, by appointment, at the FAA, New Code of Federal Regulations, in the * * * Wake Island. * * * ’’ It is not England Region, Office of the Regional Federal Register on October 25, 2000 clear how the judicial authority of the Counsel, 12 New England Executive Park, (65 FR 63826). Wake Island Court relates to the Burlington, MA; or at the Office of the authority of the U.S. District Court for Comments on Proposed Rule 32 CFR Federal Register, 800 North Capitol Street, the District of Hawaii.’’ NW, suite 700, Washington, DC. Part 935 Response: The Code has provided for Comments were received from only Effective Date over a quarter century and will continue one source, the U.S. Army Space and to provide a civil government not (e) This amendment becomes effective Missile Defense Command. otherwise provided by law. This on May 14, 2002. Comment: ‘‘As the current operator of includes those matters such as traffic Issued in Burlington, Massachusetts, on Wake Island, at least in the short term, laws and other general police powers March 29, 2002. SMDC and its employees and not included in general federal law. It is Robert G. Mann, contractors are likely to be the parties clear that the authority of the Wake Acting Manager, Engine and Propeller most affected by these revisions. As a Island Court is subordinate to that of the Directorate, Aircraft Certification Service. general matter, it is not evident that the U.S. District Court. No change will be [FR Doc. 02–8171 Filed 4–8–02; 8:45 am] current operating arrangement or made in response to this comment. makeup of the workforce (mostly foreign Comment: ‘‘Section 935.13— BILLING CODE 4910–13–U nationals) was considered in the current Revocation or suspension of permits revisions. For example, the permitting and registrations. The provision for a authority in § 935.11, and other personal hearing before the Commander DEPARTMENT OF DEFENSE functions, powers, and duties of the within 30 days could be difficult to Department of the Air Force Commander of Wake Island in § 935.12, implement from this remote location. do not appear to consider the Substantial travel by the petitioner or 32 CFR Part 935 contractual relationship between the the presence on Wake Island of an Air Army and its operating contractor on Force commissioned officer with the RIN 0701–AA65 Wake Island, which requires the Commander’s delegated authority contractor to perform many of these would be required to implement the Wake Island Code functions. In addition, the provisions provision.’’ AGENCY: Department of the Air Force, relating to the jurisdiction and Response: Under current DoD. procedures for the judiciary appear to be circumstances, a personal hearing could more appropriate for an active base with pose a difficulty if the Island ACTION: Final rule. a substantial American population than Commander were not present on the SUMMARY: The Department of the Air for the current operational situation on island and the applicant wanted to Force has revised its regulations dealing Wake Island.’’ make a personal appearance. However, with the Wake Island Code to reflect Response: Many of the comments a personal appearance is not required current and anticipated use. This was received from the U.S. Army Space and for such a hearing and the applicant is necessary because in 1994 the Air Force Missile Defense Command were based within his rights to waive a personal terminated operations on the island and on the supposition that the Army would appearance. Since the alternative is to removed its personnel. The small continue to be the primary presence on grant no right of appeal to a revocation number of personnel currently on the the island. That is no longer the case. or suspension of a permit, the current island work for the Department of the The Air Force plans to resume provision is appropriate for the Army or its contractors and it is not responsibility for host management of circumstances. There is no known anticipated that Wake Island will again the island at the beginning of fiscal year instance of any applicant for a permit or host a permanent population. 2002. The Air Force has responsibility registration having been unduly to provide the necessary level of civil burdened by this provision. No change EFFECTIVE DATE: April 10, 2002. administration for Wake Island will be made in response to this FOR FURTHER INFORMATION CONTACT: Mr. considering all probable situations. That comment. Philip Sheuerman, Associate General includes the possibility that it may Comment: ‘‘Section 935.14— Counsel, Department of the Air Force, return to an active or semi-active status. Autopsies. This provision assumes that SAF/GCN, Room 4C921, 1740 Air Force It is entirely appropriate for the Code to the Wake Island medical officer or Pentagon, Washington, DC 20330–1740, have provisions that contemplate a someone under his supervision would (703–695–4691). larger population than currently present be qualified to perform autopsies. This SUPPLEMENTARY INFORMATION: The or one made up of American nationals. may not be a correct assumption.’’ Department of the Air Force has To the extent that an Army contractor is Response: This provision makes no determined that this rule is not a major exercising authorities covered by the such assumption. Autopsies can only be rule because it will not have an annual Code that have not been delegated to it performed by a medical officer or a effect on the economy of $100 million by the Air Force Commander, the person under his supervision upon or more. The Secretary of the Air Force contractor is acting without authority. authorization of the Island Commander has certified that this rule is exempt No change will be made in response to or a Judge of the Wake Island Court. The from the requirements of the Regulatory this comment. authorizing official would have to Flexibility Act, 5 U.S.C. 601–612, Comment: ‘‘The summary of the determine that the medical officer or because this rule does not have a proposed rule states that one of its major other person were qualified to perform significant economic impact on small purposes is to ‘‘provide for civil an autopsy prior to granting
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authorization. No change will be made (such as a requirement that pets be accepted that the Government may in response to this comment. neutered).’’ charge fees, including fees to defray the Comment: ‘‘Section 935.15—Notaries Response: The goal of this change is cost of judicial services. No change will Public. The purpose of the $50.00 fee for to reduce the already existing problem be made in response to this comment. a person applying for commission as a of non-indigenous animals being Comment: ‘‘Section 935.97— notary public is not evident. The allowed to breed into feral populations, Garnishment. Is there precedent or presence of a notary on Wake Island thereby endangering the indigenous authority for the judgment of a court should be viewed as a public service. wildlife populations. The alternative to with the limited jurisdiction of the The fee could remove the incentive to a ban is to institute a cumbersome and Wake Island Court being honored by become a notary public.’’ expensive program to quarantine other jurisdictions, so as to make this Response: Since there is no animals and require inspections. Such a provision effective in carrying out prohibition of a person commissioned program would create a burdensome garnishments?’’ as a notary public from charging for his expense and consumption of resources Response: The authority of the Wake services, an appropriate fee to defray the for the Air Force. Since there is no Island Court is founded in federal law. costs of the United States in granting the current authority for the personnel now Since all courts have limitations on commission is entirely appropriate. No on Wake Island to maintain such non- their jurisdiction, that alone cannot be change will be made in response to this indigenous animals, this provision considered as defeating the authority to comment. should pose no problem for them. Were garnish wages. No change will be made Comment: ‘‘Section 935.40—Criminal they to have such animals there now, in response to this comment. Comment: ‘‘Sections 935.120 and Offenses. (1) The use of the term they would be in violation of the permit 935.121—Authority and Qualifications ‘‘assignation’’ in subsection (c) may not allowing their presence on the island. No change will be made in response to of peace officers, respectively. In be understood by many to whom it discussions with both the Marshals could apply. Recommend a more this comment. Comment: ‘‘Section 935.65(a)— Service and U.S. Attorney’s Office in generally understood term to avoid Jurisdiction. This provision appears to Hawaii in March of 1996, the ambiguity. (2) The prohibition in give the Wake Island Court jurisdiction undersigned learned that a procedure subsection (h) prohibiting entry upon over ‘‘civil actions’’ equivalent to a for deputizing individuals at Wake areas ‘‘immediately adjacent to’’ small claims court. However, there does Island could be implemented. This assigned residential quarters without not appear to be a requirement that the would enable U.S. citizens (including permission of the occupant is also claim have arisen on Wake Island or contractors) to perform these functions. subject to ambiguous interpretation. that the parties be resident on Wake We recommend that further Recommend this language be clarified to Island. Without such a limitation, there consideration be given to this option as reflect the actual residential situation on could be numerous problems a way to perform peace officer functions Wake Island. (3) The prohibition in concerning the applicable law and the on Wake Island, either to augment or subsection (j) against committing ‘‘any enforceability of the court’s decrees. In substitute for the peace officers to be act of nuisance’’ under the listing of addition, it is not apparent how vesting appointed by the provisions in the criminal offenses appears overbroad and jurisdiction over civil actions in the proposed rule.’’ difficult to enforce. Nuisance is Wake Island Court is superior to relying Response: The authority to perform normally not criminalized but is on the U.S. District Court in Hawaii to the functions of a peace officer under handled under the civil law of the adjudicate these issues.’’ the Code flows from a delegation by respective jurisdiction. (4) The Response: Since the Wake Island either the Code or the Island prohibition in subsection (n) against Court can only exercise its authority in Commander. The Code does not address loitering also appears overbroad and relation to matters under this part, its the authority of U.S. Marshals to enforce difficult to enforce. The need for this jurisdiction is necessarily limited to the laws of the United States within the provision is not evident, and the terms actions on Wake Island or its territory of the United States. Since the ‘‘without any lawful purpose’’ and ‘‘late appurtenant waters since this part is Air Force does not currently have any and unusual hours of the night’’ are only applicable to those areas. Since permanent party personnel on Wake ambiguous. What is the Air Force there has never before been a problem Island and exercises no control over the experience with this provision on other in this regard, there is no compelling Army’s contractor personnel, it is not AF bases?’’ reason to transfer jurisdiction to the U.S. inclined to consent to the deputization Response: These provisions have been District Court, even assuming it could of such contractor personnel to enforce in place since 1972 without change. assume that jurisdiction. No change will laws on Wake Island. Such a They apply to the peculiar be made in response to this comment. deputization would detract from the circumstances of Wake Island. There is Comment: ‘‘Section 935.80— authority of the Island Commander to no known instance of difficulty in Subpoenas. The requirement of maintain order and control on the applying them. Since the Air Force does subsection (d) for collection of a witness island. No change will be made in not have civil administrative authority fee for each subpoena requested by a response to this comment. over its other installations, it has no party other than the United States could Comment: ‘‘Section 935.139—Motor experience elsewhere to compare this have a chilling effect on a defendant’s vehicle operator qualifications. The to. No change will be made in response right to conduct a defense against benefit of the Commander issuing to this comment. criminal charges brought under the vehicle operator’s permits, instead of Comment: ‘‘(5) SMDC objects to the Wake Island Code. It is not clear having this function performed under prohibition in subsection 935.40(v) whether this requirement would apply the operating contract, is not clear.’’ against importing onto or keeping on to civil actions. If so, the chilling effect Response: Control of motor vehicle Wake Island non-indigenous animals would also be present in civil actions operations on Air Force installations is (pets). This is not a restriction under the tried by the Wake Island Court.’’ within the authority of the installation current operating arrangement, and Response: Arguably, all fees have a commander. It is not delegated to there are believed to be less restrictive chilling effect on the person desiring to contractor personnel, and certainly not ways to achieve the Air Force objectives take action. Nevertheless, it is widely contractor personnel of another agency
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over which the Air Force exercises no 935.65 Jurisdiction. 1972, 37 FR 12255; and Secretary of the Air control. No change will be made in 935.66 Court of Appeals. Force Order 111.1, dated 26 April 1999. response to this comment. 935.67 Clerk of the Court of Appeals. Comment: ‘‘Section 935.140—Motor 935.68 Jurisdiction of the Court of Appeals. Subpart A—General 935.69 Qualifications and admission to vehicle maintenance and equipment. practice. § 935.1 Applicability. This function is encompassed in the Subpart H—Statute of Limitations (a) The local civil and criminal laws operating contract at Wake Island. There of Wake Island consist of this part and does not appear to be a benefit from 935.70 Limitation of actions. applicable provisions of the laws of the having the function under the direction Subpart I—Subpoenas, Wake Island Court United States. of the Commander. This comment also 935.80 Subpoenas. (b) For the purposes of this part, Wake applies to Sections 935.150 and Island includes Wake, Peale, and Wilkes Subpart J—Civil Actions 935.151, and some of the provisions in Islands, and the appurtenant reefs, 935.152.’’ 935.90 General. shoals, shores, bays, lagoons, keys, Response: As noted above, the 935.91 Summons. territorial waters, and superadjacent authority to regulate activities on Wake 935.92 Service of complaint. airspace of them. Island is in the hands of the Island 935.93 Delivery of summons to plaintiff. Commander, not an Army contractor. 935.94 Answer. § 935.2 Purpose. The Army cannot delegate authority it 935.95 Proceedings; record; judgment. 935.96 Execution of judgment. The purpose of this part is to does not have. No change will be made 935.97 Garnishment. provide— in response to this comment. (a) For the civil administration of Subpart K—Criminal Actions List of Subjects in 32 CFR Part 935 Wake Island; 935.100 Bail. (b) Civil laws for Wake Island not Courts, Law enforcement, Military 935.101 Seizure of property. otherwise provided for; law, Motor vehicles, Penalties, Safety, 935.102 Information. (c) Criminal laws for Wake Island not Wake Island. 935.103 Motions and pleas. 935.104 Sentence after a plea of guilty. otherwise provided for; and For the reasons set forth in the 935.105 Trial. (d) A judicial system for Wake Island preamble, the Department of the Air not otherwise provided for. Force is revising 32 CFR Part 935 to read Subpart L—Appeals and New Trials as follows: 935.110 Appeals. § 935.3 Definitions. 935.111 New trial. In this part— PART 935—WAKE ISLAND CODE Subpart M—Peace Officers (a) General Counsel means the General Counsel of the Air Force or his Subpart A—General 935.120 Authority. 935.121 Qualifications of peace officers. successor in office. Sec. 935.122 Arrests. (b) Commander means the 935.1 Applicability. 935.123 Warrants. Commander, Wake Island. 935.2 Purpose. 935.124 Release from custody. (c) Commander, Wake Island means 935.3 Definitions. 935.125 Citation in place of arrest. 935.4 Effective date. the Commander of Pacific Air Forces or Subpart N—Motor Vehicle Code such subordinate commissioned officer Subpart B—Civil Administration Authority of the Air Force to whom he may 935.130 Applicability. 935.10 Designation and delegation of 935.131 Right-hand side of the road. delegate his authority under this part. authority. 935.132 Speed limits. (d) He or his includes both the 935.11 Permits. 935.133 Right-of-way. masculine and feminine genders, unless 935.12 Functions, powers, and duties. 935.134 Arm signals. the context implies otherwise. 935.13 Revocation or suspension of permits 935.135 Turns. (e) Judge includes Judges of the Wake and registrations. 935.136 General operating rules. Island Court and Court of Appeals. 935.14 Autopsies. 935.137 Operating requirements. 935.15 Notaries public. 935.138 Motor bus operation. § 935.4 Effective date. 935.16 Emergency authority. 935.139 Motor vehicle operator This part was originally applicable at Subpart C—Civil Law qualifications. 0000 June 25, 1972. Amendments to this 935.140 Motor vehicle maintenance and 935.20 Applicable law. equipment. part apply April 10, 2002. 935.21 Civil rights, powers, and duties. Subpart O—Registration and Island Permits Subpart B—Civil Administration Subpart D—Criminal Law 935.150 Registration. Authority 935.30 General. 935.151 Island permit for boat or vehicle. § 935.10 Designation and delegation of Subpart E—Petty Offenses 935.152 Activities for which permit is required. authority. 935.40 Criminal offenses. (a) The civil administration authority Subpart P—Public Safety Subpart F—Penalties at Wake Island is vested in the Secretary 935.160 Emergency requirements and 935.50 Petty offenses. of the Air Force. That authority has been restrictions. 935.51 Motor vehicle violations. delegated to the General Counsel of the 935.161 Fire hazards. 935.52 Violations of Subpart O or P of this 935.162 Use of special areas. Air Force with authority to redelegate part. 935.163 Unexploded ordnance material. all or any part of his functions, powers, 935.53 Contempt. 935.164 Boat operations. and duties under this part to such Subpart G—Judiciary 935.165 Floating objects. officers and employees of the Air Force 935.60 Wake Island Judicial Authority Authority: Sec. 48, Pub. L. 86–624, 74 Stat. as he may designate, but excluding 935.61 Wake Island Court. 424; E.O. 11048, Sept. 1, 1962, 27 FR 8851, redelegation of the power to promulgate, 935.62 Island Attorney. 3 CFR, 1959–1963 Comp., p. 632; agreement amend, or repeal this part, or any part 935.63 Public Defender. between the Department of Interior and thereof. Such redelegation must be in 935.64 Clerk of the Court. Department of the Air Force, dated 19 June writing and must be in accordance with
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any applicable Secretary of the Air (b) Direct the abatement of any public rendered within 30 days after a hearing, Force Orders. Such redelegation may be nuisance upon failure of any person to or the applicant desires to appeal a further redelegated subject to such comply with a notice of removal; decision, he may, within 30 days after restrictions as the delegating authority (c) Direct sanitation and fire the latest of any of the foregoing dates may impose. A redelegation may also be prevention inspections; appeal in writing to the General made to a commissioned officer serving (d) Establish records of vital statistics; Counsel, whose decision shall be final. in another United States military service (e) Direct the registration and who exercises military command, but inspections of motor vehicles, boats, § 935.14 Autopsies. such redelegation must explicitly and and aircraft; The medical officer on Wake Island, specifically list the powers redelegated (f) Impose quarantines; or any other qualified person under his and shall not include the power or (g) Direct the impoundment and supervision, may perform autopsies destruction of unsanitary food, fish, or authority to issue permits, licenses, or upon authorization of the Commander beverages; other outgrants unless individually or a Judge of the Wake Island Court. (h) Direct the evacuation of any approved by the Air Force official who person from a hazardous area; § 935.15 Notaries public. made the redelegation. The Commander (i) Commission notaries public; (a) To the extent he considers there to is the agent of the Secretary, his delegate (j) Establish and maintain a facility for be a need for such services, the and designee when carrying out any the restraint or confinement of persons Commander may commission one or function, power, or duty assigned under and provide for their care; more residents of Wake Island as this part. (k) Direct the removal of any person notaries public. The Commander of (b) The authority of the General from Wake Island and prohibit his Pacific Air Forces may not redelegate Counsel to appoint Judges shall not be future presence on the island; this authority. delegated. (l) Issue traffic regulations that are not (b) A person applying for commission (c) Judges and officers of the court inconsistent with this part, and post as a notary public must be a citizen of may not redelegate their powers or traffic signs; the United States and shall file an authorities except as specifically noted (m) Prohibit the posting, distribution, application, together with evidence of in this part. or public display of advertisements, good character and a proposed seal in signs, circulars, petitions, or similar § 935.11 Permits. such form as the Commander requires, materials, soliciting, picketing, or with a fee of $50 which shall be (a) Permits in effect on the dates parading in any public place or area if deposited in the Treasury as a specified in § 935.4 continue in effect he determines it would interfere with miscellaneous receipt. until revoked or rescinded by the public business or endanger the health (c) Upon determining there to be a Commander. Permits issued by the and safety of persons and property on need for such a service and after such Commander shall conform to the Wake Island; investigation as he considers necessary, requirements of Air Force Instruction (n) Perform or direct any other acts, the Commander may commission an 32–9003 (Available from the National not inconsistent with this part or applicant as a notary public. Technical Information Service, 5285 applicable laws and regulations, if he Commissions shall expire 3 years after Port Royal Road, Springfield, VA considers it necessary for protection of the date thereof, and may be renewed 22161.). No permit or registration shall the health or safety of persons and upon application upon payment of a fee be issued under other authority that is property on Wake Island; and of $25. inconsistent with this part. The (o) Issue any order or notice necessary (d) Judges and the Clerk of the Wake Commander may issue island permits or to implement this section. Any order or Island Court and the Island Attorney registration for— notice issued pursuant to Air Force shall have the general powers of a (1) Businesses, including any trade, directives and instructions as applicable notary public. profession, calling, or occupation, and to Wake Island shall constitute an order any establishment where food or or notice issued pursuant to this section. § 935.16 Emergency authority. During the imminence and duration beverages are prepared, offered, or sold § 935.13 Revocation or suspension of for human consumption. permits and registrations. of any emergency declared by him, the Commander may perform or direct any (2) Self-propelled motor vehicles, (a) The Commander may revoke or acts necessary to protect life and except aircraft, including attached suspend any island permit or property. trailers. registration for cause, with or without (3) Vehicle operators. notice. Subpart C—Civil Law (4) Boats. (b) The holder of any revoked or (5) Food handlers. suspended permit or registration may § 935.20 Applicable law. (6) Drugs, narcotics, and poisons. demand a personal hearing before the Civil acts and deeds taking place on (7) Construction. Commander within 30 days after the Wake Island shall be determined and (8) Burials. effective date of the revocation or adjudicated as provided in this part; and (b) To the extent it is not inconsistent suspension. otherwise, as provided in the Act of with this part, any permit or registration (c) If a hearing is demanded, it shall June 15, 1950 (64 Stat. 217) (48 U.S.C. issued pursuant to Air Force directives be granted by the Commander within 30 644a), according to the laws of the or instructions as applicable to Wake days of the date of demand. The United States relating to such an act or Island shall constitute a permit or applicant may appear in person and deed taking place on the high seas on registration under this section, and no present such documentary evidence as board a merchant vessel or other vessel other permit or registration shall be is pertinent. The Commander shall belonging to the United States. required. render a decision, in writing, setting forth his reasons, within 30 days § 935.21 Civil rights, powers, and duties. § 935.12 Functions, powers, and duties. thereafter. In any case in which the civil rights, The Commander may— (d) If a hearing is not granted within powers, and duties of any person on (a) Appoint Peace Officers; 30 days, a written decision is not Wake Island are not otherwise
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prescribed by the laws of the United (o) Lodge or sleep in any place any criminal penalty otherwise States or this part, the civil rights, without the consent of the person in applicable and currently provided by powers, and duties as they obtain under legal possession of that place; the laws of the United States. the laws of the State of Hawaii will (p) Grossly waste any potable water; apply to persons on Wake Island. (q) Being a male, knowingly enter any § 935.53 Contempt. area, building, or quarters reserved for A Judge may, in any civil or criminal Subpart D—Criminal Law women, except in accordance with case or proceeding, punish any person established visiting procedures; § 935.30 General. for disobedience of any order of the (r) Smoke or ignite any fire in any Court, or for any contempt committed in In addition to any act made criminal designated and posted ‘‘No Smoking’’ the presence of the Court, by a fine of in this part, any act committed on Wake area, or in the immediate proximity of not more than $100, or imprisonment of Island that would be criminal if any aircraft or fueling pit; not more than 30 days, or both. committed on board a merchant vessel (s) Enter any airplane parking area or or other vessel belonging to the United ramp, unless he is on duty therein, is a Subpart G—Judiciary States is a criminal offense and shall be passenger under appropriate adjudged and punished according to the supervision, or is authorized by the § 935.60 Wake Island Judicial Authority. laws applicable on board those vessels Commander to enter that place; (a) The judicial authority under this on the high seas. (t) Interfere or tamper with any part is vested in the Wake Island Court aircraft or servicing equipment or and the Wake Island Court of Appeals. Subpart E—Petty Offenses facility, or put in motion the engine of (b) The Wake Island Court and the any aircraft without the permission of § 935.40 Criminal offenses. Wake Island Court of Appeals shall each its operator; have a seal approved by the General No person may on Wake Island— (u) Post, distribute, or publicly Counsel. (a) Sell or give an alcoholic beverage display advertisements, signs, circulars, (c) Judges and Clerks of the Courts manufactured for consumption petitions, or similar materials, or solicit, may administer oaths. (including beer, ale, or wine) to any picket, or parade in any public place or person who is not at least 21 years of area where prohibited by the § 935.61 Wake Island Court. age; Commander pursuant to § 935.12; (a) The trial judicial authority for (b) Procure for, engage in, aid or abet (v) Import onto or keep on Wake Wake Island is vested in the Wake in, or solicit for prostitution; Island any plant or animal not Island Court. (c) Use any building, structure, indigenous to the island, other than vehicle, or public lands for the purpose military working dogs or a guide dog for (b) The Wake Island Court consists of of lewdness, assignation, or prostitution; the blind or visually-impaired one or more Judges, appointed by the General Counsel as needed. The term of (d) Possess or display (publicly or accompanying its owner; or a Judge shall be for one year, but he may privately) any pornographic literature, (w) Import or bring onto or possess be re-appointed. When the Wake Island film, device, or any matter containing while on Wake Island any firearm, Court consists of more than one Judge, obscene language, that tends to corrupt whether operated by air, gas, spring, or the General Counsel shall designate one morals; otherwise, or explosive device, of the Judges as the Chief Judge who (e) Make any obscene or indecent including fireworks, unless owned by will assign matters to Judges, determine exposure of his person; the United States. when the Court will sit individually or (f) Commit any disorderly, obscene, or Subpart F—Penalties en banc, and prescribe rules of the Court indecent act; not otherwise provided for in this Code. (g) Commit any act of voyeurism § 935.50 Petty offenses. If there is only one Judge appointed, (Peeping Tom); Whoever is found guilty of a violation that Judge shall be the Chief Judge. (h) Enter upon any assigned of any provision of subpart E of this part (c) Sessions of the Court are held on residential quarters or areas is subject to a fine of not more than $500 Wake Island or Hawaii at times and immediately adjacent thereto, without or imprisonment of not more than 6 places designated by the Chief Judge. permission of the assigned occupant; months, or both. (i) Discard or place any paper, debris, § 935.62 Island Attorney. refuse, garbage, litter, bottle, can, human § 935.51 Motor vehicle violations. Whoever is found guilty of a violation There is an Island Attorney, or animal waste, trash, or junk in any appointed by the General Counsel as public place, except into a receptacle or of subpart N of this part is subject to a fine of not more than $100, needed. The Island Attorney shall serve place designated or used for that at the pleasure of the General Counsel. purpose; imprisonment of not more than 30 days, or suspension or revocation of his motor The Island Attorney represents the (j) Commit any act of nuisance; United States in the Wake Island Court (k) With intent to provoke a breach of vehicle operator’s permit, or any combination or all of these and in the Wake Island Court of the peace or under such circumstances Appeals. that a breach of the peace may be punishments. occasioned thereby, act in such a § 935.52 Violations of Subpart O or P of § 935.63 Public Defender. manner as to annoy, disturb, interfere this part. There is a Public Defender, appointed with, obstruct, or be offensive to any (a) Whoever is found guilty of a by the General Counsel as needed. The other person; violation of subpart O or P of this part Public Defender shall serve at the (l) Be drunk in any public place; is subject to a fine of not more than pleasure of the General Counsel. The (m) Use any profane or vulgar $100, or imprisonment of not more than Public Defender represents any person language in a public place; 30 days, or both. charged with an offense under this part (n) Loiter or roam about Wake Island, (b) The penalties prescribed in who requests representation and who is without any lawful purpose, at late and paragraph (a) of this section are in not able to afford his own legal unusual hours of the night; addition to and do not take the place of representation.
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§ 935.64 Clerk of the Court. § 935.68 Jurisdiction of the Court of (b) No person is liable to be tried Appeals. There is a Clerk of the Court, who is under this part for any offense if the appointed by the Chief Judge. The Clerk The Court of Appeals has jurisdiction offense was committed more than 1 year shall serve at the pleasure of the Chief over all appeals from the Wake Island before the date the information or Judge. The Clerk maintains a public Court. citation is filed with the Clerk of the Wake Island Court. docket containing such information as § 935.69 Qualifications and admission to the Chief Judge may prescribe, practice. Subpart I—Subpoenas, Wake Island administers oaths, and performs such (a) No person may be appointed a Court other duties as the Court may direct. Judge, Island Attorney, or Public The Clerk is an officer of the Court. Defender under this part who is not a § 935.80 Subpoenas. § 935.65 Jurisdiction. member of the bar of a State, (a) A Judge or the Clerk of the Court Commonwealth, or Territory of the shall issue subpoenas for the attendance (a) The Wake Island Court has United States or of the District of of witnesses. The subpoena must jurisdiction over all offenses under this Columbia. include the name of the Court and the part and all actions of a civil nature, (b) Any person, other than an officer title, if any, of the proceeding; and shall cognizable at law or in equity, where the or employee of the Department of the command each person to whom it is amount in issue is not more than Air Force, appointed as a Judge, Island directed to attend and give testimony at $1,000, exclusive of interests and costs, Attorney, Public Defender, or to any the time and place specified therein. but not including changes of name or other office under this part shall, prior The Clerk may issue a subpoena for a domestic relations matters. to entering upon the duties of that party requesting it, setting forth the (b) The United States is not subject to office, take an oath, prescribed by the name of the witness subpoenaed. suit in the Court. General Counsel, to preserve, protect, (b) A Judge or the Clerk may also (c) The United States may intervene and defend the Constitution of the issue a subpoena commanding the in any matter in which the Island United States. Such oath may be person to whom it is directed to Attorney determines it has an interest. administered by any officer or employee produce the books, papers, documents, of the Department of the Air Force. or other objects designated therein. The § 935.66 Court of Appeals. (c) Civilian officers and employees of Court may direct that books, papers, (a) The appellate judicial authority for the Department of the Air Force may be documents, or other objects designated Wake Island is vested in the Wake appointed as a Judge, Island Attorney, in the subpoena be produced before the Island Court of Appeals. Public Defender, or Clerk, as an Court at a time before the trial or before additional duty and to serve without the time when they are to be offered into (b) The Wake Island Court of Appeals additional compensation. Officers and evidence. It may, upon their production, consists of a Chief Judge and two employees of the Department of the Air allow the books, papers, documents, or Associate Judges, appointed by the Force, both civilian and military, who objects or portions thereof to be General Counsel as needed. The term of serve in positions designated as inspected by the parties and their a judge shall be for one year, but he may providing legal services to the representatives. be reappointed. The Chief Judge assigns Department and who are admitted to (c) Any peace officer or any other matters to Judges, determines whether practice law in an active status before the Court sits individually or en banc, person who is not a party and who is the highest court of a State, at least 18 years of age may serve a and prescribes rules of the Court not Commonwealth, or territory of the otherwise provided for in this part. subpoena. Service of a subpoena shall United States, or of the District of be made by delivering a copy thereof to (c) Sessions of the Court of Appeals Columbia, and are in good standing the person named. are held in the National Capital Region therewith, are admitted to the Bar of the (d) The Clerk of the Court shall assess at times and places designated by the Wake Island Court and the Wake Island and collect a witness fee of $40 for each Chief Judge. The Court may also hold Court of Appeals. subpoena requested by any party other sessions at Wake Island or in Hawaii. (d) No person may practice law before than the United States, which shall be the Wake Island Court or the Wake (d) A quorum of the Court of Appeals tendered to the witness as his witness Island Court of Appeals who is not will consist of one Judge when sitting fee together with service of the admitted to Bar of those courts. Any individually and three Judges when subpoena. Witnesses subpoenaed by the person admitted to practice law in an sitting en banc. Island Attorney shall be entitled to a fee active status before the highest court of (e) The address of the Court of of $40 upon presentment of a proper a State, Commonwealth, or territory of Appeals is—Wake Island Court of claim therefor on the United States. No the United States, or of the District of Appeals, SAF/GC, Room 4E856, 1740 duly summoned witness may refuse, Columbia, and in good standing Air Force Pentagon, Washington, D.C. decline, or fail to appear or disobey a therewith, may be admitted to the Bar 20330–1740. subpoena on the ground that the witness of the Wake Island Court and the Wake fee was not tendered or received. § 935.67 Clerk of the Court of Appeals. Island Court of Appeals. Upon request of the applicant, the Court, on its own (e) Upon a showing that the evidence There is a Clerk of the Court of motion, may grant admission. A grant of is necessary to meet the ends of justice Appeals, who is appointed by the Chief admission by either court constitutes and that the defendant is indigent, the Judge. The Clerk serves at the pleasure admission to practice before both courts. Public Defender may request the Court of the Chief Judge. The Clerk maintains to direct the Island Attorney to obtain a public docket containing such Subpart H—Statute of Limitations the issuance of a subpoena on behalf of information as the Chief Judge may a defendant in a criminal case. prescribe, administers oaths, and § 935.70 Limitation of actions. Witnesses so called on behalf of the performs such other duties as the Court (a) No civil action may be filed more defendant shall be entitled to the same directs. The Clerk is an officer of the than 1 year after the cause of action witness fees as witnesses requested by Court. arose. the Island Attorney.
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(f) Subpoenas may be credited only to shall serve the summons and a copy of § 935.96 Execution of judgment. persons or things on Wake Island. the complaint at Wake Island upon the (a) If, after 60 days after the date of (g) No person who is being held on defendant personally, or by leaving entry of judgment (or such other period Wake Island because of immigration them at his usual place of abode with as the Court may prescribe), the status shall be entitled to a witness fee, any adult residing or employed there. judgment debtor has not satisfied the but shall nevertheless be subject to (b) In the case of a corporation, judgment, the judgment creditor may subpoena like any other person. partnership, joint stock company, apply to the Court for grant of execution trading association, or other on the property of the judgment debtor. Subpart J—Civil Actions unincorporated association, service may (b) Upon a writ issued by the Court, § 935.90 General. be made at Wake Island by delivering a any peace officer may levy execution on copy of the summons and complaint to any property of the judgment debtor (a) The Federal Rules of Civil any of its officers, a managing or general except— Procedure (28 U.S.C.) apply to civil agent, or any other agent authorized by (1) His wearing apparel up to a total actions in the Court to the extent the appointment or by law to receive of $300 in value; presiding Judge considers them service. (2) His beds, bedding, household applicable under the circumstances. furniture and furnishings, stove, and (b) There is one form of action called § 935.93 Delivery of summons to plaintiff. cooking utensils, up to a total of $300 the ‘‘Civil Action.’’ The Clerk of the Court shall promptly in value; and (c) Except as otherwise provided for provide a copy of the summons to the (3) Mechanics tools and implements in this part, there is no trial by jury. plaintiff, together with notice that if the of the debtor’s trade up to a total of $200 (d) A civil action begins with the plaintiff fails to appear at the Court at in value. filing of a complaint with the Court. The the time set for the trial, the case will (c) Within 60 days after levy of form of the complaint is as follows be dismissed. The trial shall be set at a execution, a peace officer shall sell the except as it may be modified to conform date that will allow each party at least seized property at public sale and shall as appropriate to the particular action: 7 days, after the pleadings are closed, to pay the proceeds to the Clerk of the prepare. Court. The Clerk shall apply the In the Wake Island Court proceeds as follows: [Civil Action No. lll] § 935.94 Answer. (1) First, to the reasonable costs of llllll (Plaintiff) vs. lllllll, (a) The defendant may, at his election, execution and sale and court costs. (Defendant) file an answer to the complaint. (2) Second, to the judgment. Complaint (b) The defendant may file a (3) Third, the residue (if any) to the counterclaim, setoff, or any reasonable llllll debtor. plaintiff alleges that the affirmative defense. (d) In any case in which property has defendant is indebted to plaintiff in the sum (c) If the defendant elects to file a of $lll; that plaintiff has demanded been seized under a writ of execution, payment of said sum; that defendant has counterclaim, setoff, or affirmative but not yet sold, the property seized refused to pay; that defendant resides at defense, the Court shall promptly send shall be released upon payment of the lllll on Wake Island; that plaintiff a copy of it to the plaintiff. judgment, court costs, and the costs of resides at llllll. § 935.95 Proceedings; record; judgment. execution. § 935.91 Summons. (a) The presiding Judge is responsible § 935.97 Garnishment. Upon the filing of a complaint, a Judge or for the making of an appropriate record (a) If a judgment debtor fails to satisfy Clerk of the Court shall issue a summons in of each civil action. a judgment in full within 60 days after the following form and deliver it for service (b) All persons shall give their the entry of judgment (or such other to a peace officer or other person specifically testimony under oath or affirmation. period as the Court may prescribe), the designated by the Court to serve it: The Chief Judge shall prescribe the oath Court may, upon the application of the In the Wake Island Court and affirmation that may be judgment creditor issue a writ of administered by any Judge or the Clerk [Civil Action No. lll] garnishment directed to any person of the Court. having money or property in his llllllll(Plaintiff), vs. (c) Each party may present witnesses llllllll (Defendant) possession belonging to the judgment and other forms of evidence. In debtor or owing money to the judgment Summons addition, the presiding Judge may debtor. The following are exempt from To the above-named defendant: informally investigate any controversy, judgment: You are hereby directed to appear and in or out of the Court, if the evidence (1) Ninety percent of so much of the answer the attached cause at llllll on obtained as a result is adequately gross wages as does not exceed $200 llllll lll day of 20—, at disclosed to all parties. Witnesses, due to the judgment debtor from his llllll -.M. and to have with you all books, papers, documents, or other employer. books, papers, and witnesses needed by you objects may be subpoenaed as provided to establish any defense you have to said (2) Eighty percent of so much of the claim. for in § 935.80 for criminal cases. gross wages as exceeds $200 but does You are further notified that in case you do (d) The Court may issue its judgment not exceed $500 due to the judgment not appear, judgment will be given against in writing or orally from the bench. debtor from his employer. you, for the amount of said claim, together However, if an appeal is taken from the (3) Fifty percent of so much of the with cost of this suit and the service of this judgment, the presiding Judge shall, gross wages as exceeds $500 due to the order. within 10 days after it is filed, file a judgment debtor from his employer. Dated: llllll, 20 llllll. memorandum of decision as a part of (b) The writ of garnishment shall be (Clerk, Wake Island Court) the record. The Judge shall place in the served on the judgment debtor and the llllllll memorandum findings of fact, garnishee and shall direct the garnishee conclusions of law, and any comments to pay or deliver from the money or § 935.92 Service of complaint. that he considers will be helpful to a property owing to the judgment debtor (a) A peace officer or other person thorough understanding and just such money or property as the Court designated by the Court to make service determination of the case on appeal. may prescribe.
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(c) The garnished amount shall be the offense has been issued, the citation (f) The accused may, at any stage of paid to the Clerk of the Court, who shall serves as an information. the trial, with the consent of the Court, apply it as follows: (b) A copy of the information shall be change a plea of not guilty to one of (1) First, to satisfy the costs of delivered to the accused, or his counsel, guilty. The Court shall then proceed as garnishment and court costs. as soon as practicable after it is filed. if the accused had originally pleaded (2) Second, to satisfy the judgment. (c) Each count of an information may guilty. (3) Third, the residue (if any) to the charge one offense only and must be § 935.104 Sentence after a plea of guilty. judgment debtor. particularized sufficiently to identify If the Court accepts a plea of guilty to (d) Funds of the debtor held by the the place, the time, and the subject any charge or charges, it shall make a United States are not subject to matter of the alleged offense. It shall finding of guilty on that charge. Before garnishment. refer to the provision of law under imposing sentence, the Court shall hear which the offense is charged, but any such statements for the prosecution and Subpart K—Criminal Actions error in this reference or its omission defense, if any, as it requires to enable may be corrected by leave of Court at § 935.100 Bail. it to determine the sentence to be any time before sentence and is not (a) A person who is arrested on Wake imposed. The accused or his counsel grounds for reversal of a conviction if Island for any violation of this part is may make any reasonable statement he the error or omission did not mislead entitled to be released on bail in an wishes in mitigation or of previous good the accused to his prejudice. amount set by a Judge or Clerk of the character. The prosecution may Court, which may not exceed the § 935.103 Motions and pleas. introduce evidence in aggravation, or of maximum fine for the offense charged. (a) Upon motion of the accused at any bad character if the accused has introduced evidence of good character. If the defendant fails to appear for time after filing of the information or The Court shall then impose any lawful arraignment, trial or sentence, or copy of citation, the Court may order the sentence that it considers proper. otherwise breaches any condition of prosecutor to allow the accused to bail, the Court may direct a forfeiture of inspect and copy or photograph § 935.105 Trial. the whole or part of the bail and may designated books, papers, documents, or (a) If the accused pleads not guilty, he on motion after notice to the surety or tangible objects obtained from or sureties, if any, enter a judgment for the is entitled to a trial on the charges in belonging to the accused, or obtained accordance with procedures prescribed amount of the forfeiture. from others by seizure or process, upon (b) The Chief Judge of the Wake Island in the Rules of Criminal Procedure for a showing that the items sought may be the U.S. District Courts (18 U.S.C.), Court may prescribe a schedule of bail material to the preparation of his for any offense under this part which except as otherwise provided for in this defense and that the request is part, to the extent the Court considers the defendant may elect to post and reasonable. practicable and necessary to the ends of forfeit without trial, in which case the (b) When the Court is satisfied that it justice. There is no trial by jury. Court shall enter a verdict of guilty and has jurisdiction to try the accused as (b) All persons shall give their direct forfeiture of the bail. charged, it shall require the accused to testimony under oath or affirmation. (c) Bail will be deposited in cash with identify himself and state whether or The Chief Judge shall prescribe the oath the Clerk of the Court. not he has counsel. If he has no counsel, and affirmation that may be § 935.101 Seizure of property. but desires counsel, the Court shall give administered by any Judge or the Clerk Any property seized in connection him a reasonable opportunity to procure of the Court. (c) Upon completion of the trial, the with an alleged offense (unless the counsel. Court shall enter a judgment consisting property is perishable) is retained (c) When both sides are ready for of a finding or findings and sentence or pending trial in accordance with the arraignment, or when the Court determines that both sides have had sentences, or discharge of the accused. orders of the Court. The property must (d) The Court may suspend any be produced in Court, if practicable. At adequate opportunities to prepare for arraignment, the Court shall read the sentence imposed, may order the the termination of the trial, the Court revocation of any Island automobile shall restore the property or the funds charges to the accused, explain them (if necessary), and, after the reading or permit in motor vehicle cases, and may resulting from the sale of the property place the accused on probation. It may to the owner, or make such other proper stating of each charge in Court, ask the accused whether he pleads ‘‘guilty’’ or delay sentencing pending the receipt of order as may be required and any presentencing report ordered by it. incorporate its order in the record of the ‘‘not guilty’’. The Court shall enter in case. Any item used in the commission the record of the case the plea made to Subpart L—Appeals and New Trials of the offense, may, upon order of the each charge. Court, be forfeited to the United States. (d) The accused may plead ‘‘guilty’’ to § 935.110 Appeals. All contraband, which includes any any or all of the charges against him, (a) Any party to an action may, within item that is illegal for the owner to except that the Court may in its 15 days after judgment, appeal an possess, shall be forfeited to the United discretion refuse to accept a plea of interlocutory order, issue of law, or States; such forfeiture shall not relieve guilty, and may not accept a plea judgment, except that an acquittal may the owner from whom the item was without first determining that the plea not be appealed, by filing a notice of taken from any costs or liability for the is made voluntarily with understanding appeal with the Clerk of the Wake proper disposal of such item. of the nature of the charge. Island Court and serving a copy on the (e) The accused may plead ‘‘not opposing party. Judgment is stayed § 935.102 Information. guilty’’ to any or all of the charges while the appeal is pending. (a) Any offense may be prosecuted by against him. The Court shall enter a plea (b) Upon receiving a notice of appeal a written information signed by the of not guilty if the answer of the accused with proof of service on the opposing Island Attorney. However, if the offense to any charge is such that it does not party, the Clerk shall forward the record is one for which issue of a citation is clearly amount to a plea of guilty or not of the action to the Wake Island Court authorized by this part and a citation for guilty. of Appeals.
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(c) The appellant shall serve on the (i) May remove and impound (1) It appears necessary to prevent opposing party and file a memorandum abandoned or unlawfully parked serious injury to persons or damage to setting forth his grounds of appeal with vehicles, boats, or aircraft, or vehicles, property and time does not permit the the Wake Island Court of Appeals boats, or aircraft interfering with fire obtaining of a warrant; within 15 days after the date of the control apparatus or ambulances; (2) To effect an arrest when in hot judgment. The appellee may serve and (j) May take possession of property pursuit; or file a reply memorandum within 15 lost, abandoned, or of unknown days thereafter. An appeal and the reply ownership; (3) To prevent the commission of a shall be deemed to be filed when (k) May enforce quarantines; crime which he reasonably believes is deposited in the U.S. mail with proper (l) May impound and destroy food, being committed or is about to be postage affixed, addressed to the Clerk, fish, or beverages found unsanitary; committed. Wake Island Court of Appeals, at his (m) May be armed; (n) May exercise custody over persons § 935.123 Warrants. address in Washington, DC. The period in arrest or confinement; for filing an appeal may be waived by Any Judge may issue or direct the (o) May issue citations for violations Clerk to issue a warrant for arrest if, the Court of Appeals when the interests of this part; and of justice so require. upon complaint, it appears that there is (p) May make arrests, as provided for probable cause to believe an offense has (d) The Court of Appeals may proceed in § 935.122. to judgment on the record, or, if the been committed and that the person Court considers that the interests of § 935.121 Qualifications of peace officers. named in the warrant has committed it. justice so require, grant a hearing. Any person appointed as a peace If a Judge is not available, the warrant (e) The decision of the Court of officer must be a citizen of the United may be issued by the Clerk and Appeals shall be in writing and based States and have attained the age of 18 executed, but any such warrant shall be on the record prepared by the Wake years. The following persons, while on thereafter approved or quashed by the Island Court, on the proceedings before Wake Island on official business, shall first available Judge. The issuing officer the Court of Appeals, if any be had, and be deemed peace officers: special agents shall— on any memoranda that are filed. If the of the Air Force Office of Special (a) Place the name of the person Court of Appeals considers the record Investigations, members of the Air Force charged with the offense in the warrant, incomplete, the case may be remanded Security Forces, agents of the Federal or if his name is not known, any name to the Wake Island Court for further Bureau of Investigation, United States or description by which he can be proceedings. marshals and their deputies, officers identified with reasonable certainty; (f) The decision of the Court of and agents of the United States Secret (b) Describe in the warrant the offense Appeals is final. Service, agents of the United States charged; Bureau of Alcohol, Tobacco, and § 935.111 New trial. Firearms, agents of the United States (c) Place in the warrant a command A Judge of the Wake Island Court may Customs Service, and agents of the that the person charged with the offense order a new trial as required in the United States Immigration and be arrested and brought before the Wake interest of justice, or vacate any Naturalization Service. Island Court; judgment and enter a new one, on (d) Sign the warrant; and § 935.122 Arrests. motion made within a reasonable time (e) Issue the warrant to a peace officer after discovery by the moving party of (a) Any person may make an arrest on for execution. matters constituting the grounds upon Wake Island, without a warrant, for any which the motion for new trial or crime (including a petty offense) that is § 935.124 Release from custody. vacation of judgment is made. committed in his presence. (b) Any peace officer may, without a The Chief Judge may authorize the Subpart M—Peace Officers warrant, arrest any person on Wake Clerk to issue pro forma orders of the Island who violates any provision of Court discharging any person from § 935.120 Authority. this part or commits a crime that is not custody, with or without bail, pending Peace officers— a violation of this part, in his presence, trial, whenever further restraint is not (a) Have the authority of a sheriff at or that he reasonably believes that required for protection of persons or common law; person to have committed. property on Wake Island. Persons not so (b) May serve any process on Wake (c) In making an arrest, a peace officer discharged shall be brought before a Island that is allowed to be served under must display a warrant, if he has one, Judge or U.S. Magistrate as soon as a a Federal or State law; the officer or otherwise clearly advise the person Judge or Magistrate is available. Judges serving the process shall execute any arrested of the violation alleged, and may discharge defendants from custody, required affidavit of service; thereafter require him to submit and be with or without bail or upon (c) May conduct sanitation or fire taken before the appropriate official on recognizance, or continue custody prevention inspections; Wake Island. pending trial as the interests of justice (d) May inspect motor vehicles, boats, (d) In making an arrest, a peace officer and public safety require. and aircraft; may use only the degree of force needed § 935.125 Citation in place of arrest. (e) May confiscate property used in to effect submission, and may remove the commission of a crime; any weapon in the possession of the In any case in which a peace officer (f) May deputize any member of the person arrested. may make an arrest without a warrant, Air Force serving on active duty or (e) A peace officer may, whenever he may issue and serve a citation if he civilian employee of the Department of necessary to enter any building, vehicle, considers that the public interest does the Air Force to serve as a peace officer; or aircraft to execute a warrant of arrest, not require an arrest. The citation must (g) May investigate accidents and force an entry after verbal warning. briefly describe the offense charged and suspected crimes; (f) A peace officer may force an entry direct the accused to appear before the (h) May direct vehicular or pedestrian into any building, vehicle, or aircraft Wake Island Court at a designated time traffic; whenever— and place.
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Subpart N—Motor Vehicle Code § 935.135 Turns. (q) Operate a motor vehicle at night or (a) Each person making a right turn in when raining on the traveled part of a § 935.130 Applicability. a motor vehicle shall make the approach street or road, without using operating This subpart applies to self-propelled and turn as close as practicable to the headlights; or motor vehicles (except aircraft), right-hand curb or road edge. (r) Operate a motor vehicle without including attached trailers. (b) Each person making a left turn in each passenger wearing a safety belt; a motor vehicle shall make the approach this shall not apply to military combat § 935.131 Right-hand side of the road. and turn immediately to the right of the vehicles designed and fabricated Each person driving a motor vehicle center of the road, except that on multi- without safety belts. on Wake Island shall drive on the right- lane roads of one-way traffic flow he hand side of the road, except where may make the turn only from the left § 935.137 Operating requirements. necessary to pass or on streets where a lane. Each person operating a motor vehicle sign declaring one-way traffic is posted. (c) No person may make a U-turn in on Wake Island shall— (a) Turn off the highbeam headlights § 935.132 Speed limits. a motor vehicle if he cannot be seen by the driver of any approaching vehicle of his vehicle when approaching an Each person operating a motor vehicle within a distance of 500 feet. oncoming vehicle at night; and on Wake Island shall operate it at a (d) No person may place a vehicle in (b) Comply with any special traffic speed— motion from a stopped position, or instructions given by an authorized (a) That is reasonable, safe, and change from or merge into a lane of person. proper, considering time of day, road traffic, until he can safely make that § 935.138 Motor bus operation. and weather conditions, the kind of movement. motor vehicle, and the proximity to Each person operating a motor bus on persons or buildings, or both; and § 935.136 General operating rules. Wake Island shall— (b) That does not exceed 40 miles an No person may, while on Wake (a) Keep its doors closed while the hour or such lesser speed limit as may Island— bus is moving with passengers on board; be posted. (a) Operate a motor vehicle in a and careless or reckless manner; (b) Refuse to allow any person to § 935.133 Right-of-way. (b) Operate or occupy a motor vehicle board or alight the bus while it is (a) A pedestrian has the right-of-way while he is under the influence of a moving. over vehicular traffic when in the drug or intoxicant; (c) Consume an alcoholic beverage § 935.139 Motor vehicle operator vicinity of a building, school, or qualifications. residential area. (including beer, ale, or wine) while he (a) No person may operate a privately (b) In any case in which two motor is in a motor vehicle; owned motor vehicle on Wake Island vehicles have arrived at an uncontrolled (d) Operate a motor vehicle that is unless he has an island operator’s intersection at the same time, the overloaded or is carrying more permit. vehicle on the right has the right-of-way. passengers than it was designed to (b) The Commander may issue an (c) If the driver of a motor vehicle carry; operator’s permit to any person who is enters an intersection with the intent of (e) Ride on the running board, step, or at least 18 years of age and satisfactorily making a left turn, he shall yield the outside of the body of a moving motor demonstrates safe-driving knowledge, right-of-way to any other motor vehicle vehicle; ability, and physical fitness. that has previously entered the (f) Ride a moving motor vehicle with his arm or leg protruding, except when (c) No person may operate, on Wake intersection or is within hazardous Island, a motor vehicle owned by the proximity. using the left arm to signal a turn; (g) Operate a motor vehicle in a speed United States unless he holds a current (d) When being overtaken by another contest or drag race; operator’s permit issued by the United motor vehicle, the driver of the slower (h) Park a motor vehicle for a period States. vehicle shall move it to the right to longer than the posted time limit; (d) Each person operating a motor allow safe passing. (i) Stop, park, or operate a motor vehicle on Wake Island shall present his (e) The driver of a motor vehicle shall vehicle in a manner that impedes or operator’s permit to any peace officer, yield the right-of-way to emergency blocks traffic; for inspection, upon request. vehicles on an emergency run. (j) Park a motor vehicle in an § 935.140 Motor vehicle maintenance and § 935.134 Arm signals. unposted area, except adjacent to the right-hand curb or edge of the road; equipment. (a) Any person operating a motor (k) Park a motor vehicle in a reserved (a) Each person who has custody of a vehicle and making a turn or coming to or restricted parking area that is not motor vehicle on Wake Island shall a stop shall signal the turn or stop in assigned to him; present that vehicle for periodic safety accordance with this section. (l) Sound the horn of a motor vehicle, inspection, as required by the (b) A signal for a turn or stop is made except as a warning signal; Commander. by fully extending the left arm as (m) Operate a tracked or cleated (b) No person may operate a motor follows: vehicle in a manner that damages a vehicle on Wake Island unless it is in a (1) Left turn—extend left arm paved or compacted surface; condition that the Commander horizontally. (n) Operate any motor vehicle considers to be safe and operable. (2) Right turn—extend left arm contrary to a posted traffic sign; (c) No person may operate a motor upward. (o) Operate a motor vehicle as to vehicle on Wake Island unless it is (3) Stop or decrease speed—extend follow any other vehicle closer than is equipped with an adequate and left arm downward. safe under the circumstances; properly functioning— (c) A signal light or other device may (p) Operate a motor vehicle off of (1) Horn; be used in place of an arm signal established roads, or in a cross-country (2) Wiper, for any windshield; prescribed in paragraph (b) of this manner, except when necessary in (3) Rear vision mirror; section if it is visible and intelligible. conducting business; (4) Headlights and taillights;
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(5) Brakes; (f) Importing, storing, generating, or Commander may prescribe in the public (6) Muffler; disposing of hazardous materials. interest. (7) Spark or ignition noise (g) Importing of solid wastes and suppressors; and importing, storing, generating, treating, § 935.165 Floating objects. (8) Safety belts. or disposing of hazardous wastes, as No person may anchor, moor, or (d) No person may operate a motor they are defined in the Solid Waste beach any boat, barge, or other floating vehicle on Wake Island if that vehicle is Disposal Act, as amended, 42 U.S.C. object on Wake Island in any location or equipped with a straight exhaust or 6901 et seq., and its implementing manner other than as prescribed by the muffler cutoff. regulations (40 CFR chapter I). Commander. Pamela D. Fitzgerald, Subpart O—Registration and Island Subpart P—Public Safety Permits Air Force Federal Register Liaison Officer. § 935.160 Emergency requirements and [FR Doc. 02–8303 Filed 4–8–02; 8:45 am] § 935.150 Registration. restrictions. BILLING CODE 5001–05–U (a) Each person who has custody of In the event of any fire, crash, search any of the following on Wake Island and rescue, natural disaster, national shall register it with the Commander. peril, radiological hazard, or other ENVIRONMENTAL PROTECTION (1) A privately owned motor vehicle. calamitous emergency— (2) A privately owned boat. AGENCY (a) No person may impede or hamper (3) An indigenous animal, military any officer or employee of the United 40 CFR Part 52 working dog, or guide dog for the blind States or any other person who has or visually-impaired accompanying its [KY–200215; FRL–7168–6] owner. emergency authority; (4) A narcotic or dangerous drug or (b) No unauthorized persons may Approval and Promulgation of any poison. congregate at the scene of the Implementation Plans; Commonwealth (b) Each person who obtains custody emergency; and of Kentucky: Approval of Revisions to of an article described in paragraph (a) (c) Each person present shall the 1-Hour Ozone Maintenance State (4) of this section shall register it promptly obey the instructions, signals, Implementation Plan for the Edmonson immediately upon obtaining custody. or alarms of any peace officer, fire or County and the Owensboro-Daviess Each person who obtains custody of any crash crew, or other authorized person, County Area; Clarification other article described in paragraph (a) and any orders of the Commander. AGENCY: Environmental Protection of this section shall register it within 10 § 935.161 Fire hazards. days after obtaining custody. Agency (EPA). (a) Each person engaged in a business ACTION: Final rule; clarification. § 935.151 Island permit for boat and or other activity on Wake Island shall, vehicle. at his expense, provide and maintain (in SUMMARY: EPA is clarifying its approval (a) No person may use a privately an accessible location) fire extinguishers of revisions to the 1-hour ozone owned motor vehicle or boat on Wake of the type, capacity, and quantity maintenance plans for the Owensboro Island unless he has an island permit for satisfactory for protecting life and area (i.e., Daviess and a portion of it. property in the areas under that person’s Hancock counties), and Edmonson (b) The operator of a motor vehicle control. County portions of the Kentucky State shall display its registration number on (b) To minimize fire hazards, no Implementation Plan (SIP) submitted on the vehicle in a place and manner person may store any waste or April 16, 1998, by the Commonwealth prescribed by the Commander. flammable fluids or materials except in of Kentucky through the Natural a manner and at a place prescribed by Resources and Environmental § 935.152 Activities for which permit is the Commander. Protection Cabinet. Although not required. explicit in the language of the document No person may engage in any of the § 935.162 Use of special areas. for the approval, the Commonwealth’s following on Wake Island unless he has The Commander may regulate the use request and EPA’s action involved the an island permit: of designated or posted areas on Wake approval of an update for emission (a) Any business, commercial, or Island, as follows: projections that were originally recreational activity conducted for (a) Restricted areas—which no person developed with an earlier version of the profit, including a trade, profession, may enter without permission. EPA mobile emissions model. That calling, or occupation, or an (b) Prohibited activities areas—in same approval action also identified the establishment where food or beverage is which no person may engage in any emission projections as the motor prepared, offered, or sold for human activity that is specifically prohibited. vehicle emissions budgets (or consumption (except for personal or (c) Special purpose areas-in which no ‘‘budgets’’) for nitrogen oxides (NOX) family use). person may engage in any activity other and volatile organic compounds (VOC) (b) The practice of any medical than that for which the area is reserved. for use in transportation conformity profession, including dentistry, surgery, determinations. However, that action osteopathy, and chiropractic. § 935.163 Unexploded ordnance material. did not specify for what year the (c) The erection of any structure or Any person who discovers any ‘‘budgets’’ were being established. This sign, including a major alteration or unexploded ordnance material on Wake action merely clarifies for which year enlargement of an existing structure. Island shall refrain from tampering with the ‘‘budgets’’ for NO and VOC were (d) The burial of any human or animal it and shall immediately report its site X being established. remains, except that fish and bait scrap to the Commander. may be buried at beaches where fishing EFFECTIVE DATE: This clarification is is permitted, without obtaining a § 935.164 Boat operations. effective on May 9, 2002. permit. The operator of each boat used at FOR FURTHER INFORMATION CONTACT: (e) Keeping or maintaining an Wake Island shall conform to the Lynorae Benjamin, Air Quality indigenous animal. limitations on its operations as the Modeling and Transportation Section,
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Air Planning Branch, Air, Pesticides and the approval of the maintenance plans Distribution, or Use’’ (66 FR 28355, May Toxics Management Division, Region 4, for the Owensboro area and Edmonson 22, 2001). This action merely approves Environmental Protection Agency, County. Specifically, EPA is taking this state law as meeting Federal Atlanta Federal Center, 61 Forsyth action to explicitly state that 2004 is the requirements and imposes no additional Street, SW., Atlanta, Georgia 30303– year for which the budgets were requirements beyond those imposed by 8960. The telephone number is (404) established by Kentucky, and that the state law. Accordingly, the 562–9040. Ms. Benjamin can also be VOC and NOX emission projections for Administrator certifies that this rule reached via electronic mail at 2004, which is the last year of the will not have a significant economic [email protected]. maintenance plans, are the ‘‘budgets’’ to impact on a substantial number of small be used for the purposes of entities under the Regulatory Flexibility SUPPLEMENTARY INFORMATION: The transportation conformity. This action is Act (5 U.S.C. 601 et seq.). Because this following subsections provide a brief administrative and does not involve any rule approves pre-existing requirements overview of EPA’s previous approval technical changes to the under state law and does not impose action and the clarification being Commonwealth’s previous submittal for any additional enforceable duty beyond provided by this action. which EPA granted approval. that required by state law, it does not contain any unfunded mandate or A. What Is the Background for This C. What Are the Motor Vehicle significantly or uniquely affect small Action? Emissions Budgets for the Edmonson governments, as described in the Through direct final rulemaking, County and Owensboro Areas? Unfunded Mandates Reform Act of 1995 published in the Federal Register on As mentioned previously, this action (Pub. L. 104–4). September 3, 1998, (63 FR 46894) EPA is administrative and does not involve This action also does not have tribal approved revisions to the 1-hour ozone any technical changes to the emission implications because it will not have a maintenance plans for the Owensboro projections supplied by the State in the substantial direct effect on one or more area (i.e., Daviess and Hancock April 16, 1998, Kentucky SIP revision Indian tribes, on the relationship counties), and Edmonson County. These request. The following tables highlight between the Federal Government and revisions to the Kentucky SIP were the motor vehicle emissions budgets for Indian tribes, or on the distribution of submitted on April 16, 1998, by the NO X and VOCs for the Edmonson power and responsibilities between the Commonwealth of Kentucky. The County and Owensboro maintenance Federal Government and Indian tribes, purpose of our action was to incorporate areas in Kentucky. as specified by Executive Order 13175 revised motor vehicle emissions budgets (65 FR 67249, November 9, 2000). This for NOX and VOCs for the Owensboro 2004 MOTOR VEHICLE EMISSIONS action does not have Federalism area and Edmonson County, Kentucky, BUDGETS FOR EDMONSON COUNTY implications because it does not have into the federally-approved SIP. substantial direct effects on the States, Specifically, that SIP revision updated VOC NOX on the relationship between the national emission projections previously (tons per day) (tons per day) government and the States, or on the developed with the MOBILE 4.1 0.72 ...... 0.78 distribution of power and emissions model with emissions responsibilities among the various projections developed with the MOBILE levels of government, as specified in 5a emissions model. Our approval 2004 MOTOR VEHICLE EMISSIONS Executive Order 13132 (64 FR 43255, specified that the emission projections BUDGETS FOR OWENSBORO August 10, 1999). This action merely were being considered as ‘‘budgets’’ to clarifies EPA’s approval of a state rule be used for demonstration of conformity VOC NOX implementing a Federal standard, and of transportation plans, programs, and (tons per day) (tons per day) does not alter the relationship or the projects with the Kentucky SIP for the distribution of power and 6.64 ...... 5.22 Edmonson County and Owensboro responsibilities established in the Clean ozone maintenance areas. However, Air Act. This rule also is not subject to Kentucky’s SIP for these areas did not Final Action Executive Order 13045 ‘‘Protection of explicitly specify for which years the EPA is clarifying its previous Children from Environmental Health new conformity budgets would apply. approval for revisions to the 1-hour Risks and Safety Risks’’ (62 FR 19885, B. Why Is EPA Taking This Action? ozone maintenance plans to the April 23, 1997), because it is not Owensboro area (i.e., Daviess and economically significant. EPA is taking this action to provide Hancock counties), and Edmonson In addition, since this action is only clarity for the transportation and air County portions of the Kentucky SIP, correcting a federal citation for a SIP quality partners in this area that work which were submitted on August 16, submission that has already been together to implement the transportation 1998 by the Commonwealth of approved by EPA, the requirements of conformity rule. EPA recently reviewed Kentucky. This action specifies 2004 as section 12(d) of the National all of the maintenance plans that were the ‘‘budget’’ year to be used for the Technology Transfer and Advancement submitted by Kentucky in 1994 and any purposes of transportation conformity. Act of 1995 (15 U.S.C. 272 note) do not subsequent revisions to these apply. This rule does not impose an Administrative Requirements maintenance plans. This review information collection burden under the revealed that while Kentucky had Under Executive Order 12866 (58 FR provisions of the Paperwork Reduction included emissions projections for 51735, October 4, 1993), this action is Act of 1995 (44 U.S.C. 3501 et seq.). VOCs and NOX for several years in each not a ‘‘significant regulatory action’’ and The Congressional Review Act, 5 of these submittals, it was only in the therefore is not subject to review by the U.S.C. section 801 et seq., as added by case of the Owensboro area and Office of Management and Budget. For the Small Business Regulatory Edmonson County that EPA had this reason, this action is also not Enforcement Fairness Act of 1996, approved all of these years as subject to Executive Order 13211, generally provides that before a rule conformity budgets. Based on this ‘‘Actions Concerning Regulations That may take effect, the agency review, EPA is taking action to correct Significantly Affect Energy Supply, promulgating the rule must submit a
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rule report, which includes a copy of the existing Commission rules regarding sections 1, 4(i)–4(j), and 276 of the the rule, to each House of the Congress the accounting safeguards. Communications Act of 1934, as and to the Comptroller General of the FOR FURTHER INFORMATION CONTACT: Joi amended, 47 U.S.C. 151, 154(i)–(j), 276, United States. EPA will submit a report Roberson Nolen, Wireline Competition the Petition for Partial Reconsideration containing this rule and other required Bureau, 202–418–1537. and Clarification of the Inmate Calling information to the U.S. Senate, the U.S. SUPPLEMENTARY INFORMATION: Section Services Providers Coalition is denied. House of Representatives, and the 276 of the Communications Act of 1934, Federal Communications Commission. Comptroller General of the United as amended (the Act), directs the William F. Caton, States prior to publication of the rule in Commission to ‘‘establish a per call Acting Secretary. the Federal Register. A major rule compensation plan to ensure that all cannot take effect until 60 days after it [FR Doc. 02–8343 Filed 4–8–02; 8:45 am] payphone service providers are fairly BILLING CODE 6712–01–P is published in the Federal Register. compensated for each and every This action is not a ‘‘major rule’’ as completed intrastate and interstate call defined by 5 U.S.C. section 804(2). using their payphone.’’ See 47 U.S.C. FEDERAL COMMUNICATIONS Under section 307(b)(1) of the Clean 276(b)(1)(A). The ICSPC sought COMMISSION Air Act, petitions for judicial review of reconsideration of certain issues relating this action must be filed in the United to inmate calling services. See 47 CFR Parts 2 and 26 States Court of Appeals for the Implementation of the Pay Telephone [WT Docket No. 00–32; FCC 02–47] appropriate circuit by June 10, 2002. Reclassification and Compensation Filing a petition for reconsideration by Provisions of the Telecommunications The 4.9 GHz Band Transferred From the Administrator of this final rule does Act of 1996, CC Docket No. 96–128, Federal Government Use not affect the finality of this rule for the Order on Reconsideration, 11 FCC Rcd purposes of judicial review nor does it 21233 (1996), 61 FR 65341 (Dec. 12, AGENCY: Federal Communications extend the time within which a petition 1996)(Order on Reconsideration) aff’d in Commission. for judicial review may be filed, and part and remanded in part, Illinois Pub. ACTION: Final rule. shall not postpone the effectiveness of Tel. Ass’n v. FCC, 117 F.3d 555 (D.C. SUMMARY: In this document, the such rule or action. This action may not Cir. 1997), cert. denied sub nom., be challenged later in proceedings to Commission allocates 50 megahertz of Virginia State Corp. Comm’n v. FCC, spectrum in the 4940–4990 MHz band enforce its requirements. (See section 523 U.S. 1046 (1998). ICSPC, along with 307(b)(2).) (4.9 GHz band) for fixed and mobile numerous other parties, initially sought services (except aeronautical mobile List of Subjects in 40 CFR Part 52 review of the Order on Reconsideration service) and designates this band for use before the United States Court of Environmental protection, Air in support of public safety. The Appeals for the District of Columbia pollution control, Intergovernmental allocation and designation provide Circuit and consolidated its appeal relations, Ozone, Reporting and public safety users with additional under the lead case Illinois Public recordkeeping requirements. spectrum to support new broadband Telecommunications Association v. Authority: 42 U.S.C. 7401 et seq. applications. This action is pursuant to FCC. The court subsequently severed statutory requirements of the Omnibus Dated: March 21, 2002. ICSPC’s appeal, and later remanded it at Budget Reconciliation Act of 1993. The Michael V. Peyton, the Commission’s request. The Commission also continues its ongoing Acting Regional Administrator, Region 4. Commission issued a Public Notice effort to streamline rules and eliminate [FR Doc. 02–8295 Filed 4–8–02; 8:45 am] asking parties to update and refresh the redundancy by removing part 26. record with respect to the issues raised BILLING CODE 6560–50–P DATES: Effective May 9, 2002. in ICSPC’s appeal. In this order, the Commission ADDRESSES: Parties who choose to file concluded that section 276’s fair comments by paper must file an original FEDERAL COMMUNICATIONS compensation requirement does not and four copies to William F. Caton, COMMISSION require either preemption of state local Acting Secretary, Office of the Secretary, Federal Communications Commission, 47 CFR Parts 1, 61, and 69 collect calling caps or imposition of a federally-tariffed surcharge above state 445 12th St., SW., Room TW-A325, [CC Docket No. 96–128; FCC 02–39] rate caps for local inmate calls. The Washington, DC 20554. Comments may Commission also concluded that also be filed using the Commission’s Implementation of Pay Telephone ICSPC’s requested nonstructural Electronic Filing System, which can be Reclassification and Compensation safeguards are not necessary, in light of accessed via the Internet at Provisions of the Telecommunications those that section 276 and our rules www.fcc.gov/e-file/ecfs.html. Act of 1996 already impose. In addition, the FOR FURTHER INFORMATION CONTACT: AGENCY: Federal Communications Commission initiated a Notice of Genevieve Augustin, Esq., Commission. Proposed Rulemaking to examine the [email protected], or Roberto Mussenden, Esq., [email protected], ACTION: Final rule. costs associated with the provision of inmate calling services. See Policy and Rules Branch, Public Safety SUMMARY: In this document the Implementation of the Pay Telephone and Private Wireless Division, Wireless Commission declined to modify its Reclassification and Compensation Telecommunications Bureau, (202) 418– accounting safeguards in the manner Provisions of the Telecommunications 0680, or TTY (202) 418–7233. requested by the Inmate Calling Services Act of 1996, CC Docket No. 96–128, SUPPLEMENTARY INFORMATION: This is a Provider Coalition (ICSPC) in part Notice of Proposed Rulemaking, FCC summary of the Federal because the Commission’s existing rules 02–39 ( Feb. 21, 2002) (published Communications Commission’s Second already provide for much of the relief elsewhere in this issue) . Report and Order, FCC 02–47, adopted that the ICSPC requested. The intended Accordingly, it is ordered that, on February 14, 2002, and released on effect of this document is to maintain pursuant to the authority contained in February 27, 2002. The full text of this
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document is available for inspection MHz sub-band and the 4990–5000 MHz 4.9 GHz band and therefore licensing and copying during normal business band. The Commission deletes the this band for public safety is fully hours in the FCC Reference Center, Government fixed and mobile service consistent with the Communications Room CY–A257, 445 12th Street, SW., allocations from the 4.9 GHz band. The Act. Washington, DC 20554. The complete Commission concludes that a flexible II. Final Regulatory Flexibility text may be purchased from the allocation would be in the public Certification (Second Report and Commission’s copy contractor, Qualex interest. Such flexibility would not Order) International, 445 12th Street, SW., deter investment in communications Room CY–B402, Washington, DC 20554. and services, or technology 6. The Regulatory Flexibility Act The full text may also be downloaded development; and would not cause (RFA) requires that a regulatory at: www.fcc.gov. Alternative formats are harmful interference among users. flexibility analysis be prepared for available to persons with disabilities by notice and comment rulemaking B. Sharing With Passive Operations contacting Brian Millin at (202) 418– proceedings, unless the agency certifies 7426 or TTY (202) 418–7365. 3. Regarding radio astronomy use of that ‘‘the rule will not, if promulgated, 1. In this Second Report and Order the 4.9 GHz band, the Commission have a significant economic impact on (Second R&O), the Commission deletes footnote US257 from the Table a substantial number of small entities.’’ allocates 50 megahertz of spectrum in of Frequency Allocations and merges it The RFA generally defines ‘‘small the 4940–4990 MHz band (4.9 GHz into a revised footnote US311, requiring entity’’ as having the same meaning as band) for fixed and mobile services that every practical effort be made to the term ‘‘small business,’’ ‘‘small (except aeronautical mobile service) and protect radio astronomy observations in organization,’’ and ‘‘small governmental designates this band for use in support the 4950–4990 MHz band, which jurisdiction.’’ In addition, the term of public safety. This allocation and operate on an unprotected basis at ‘‘small business’’ has the same meaning designation will provide public safety certain Radio Astronomy Observatories as the term ‘‘small business concern’’ users with additional spectrum to listed. The Commission declines the under the Small Business Act. A small support new broadband applications exclusion of non-aeronautical mobile business concern is one which: (1) Is such as high-speed digital technologies operation and the imposition of independently owned and operated; (2) and wireless local area networks frequency coordination procedures on is not dominant in its field of operation; (WLANs) for incident scene fixed or non-aeronautical mobile and (3) satisfies any additional criteria management. The spectrum will also operation within the radio astronomy established by the Small Business support dispatch operations and zones. Administration (SBA). 7. This Second R&O allocates the vehicular/personal communications. C. Removal of Part 26 of the The Commission believes this decision band 4940–4990 MHz to the fixed and Commission’s Rules aligns with new national priorities mobile, except aeronautical mobile, focusing on homeland security, and will 4. Inasmuch as there are no part 26 services on a co-primary basis, to be ensure that agencies involved in the licensees, and the Commission no used exclusively by public safety. This protection of life and property possess longer has jurisdiction over the allocation affects public safety users by the communications resources needed frequencies to which these rules are providing them with additional to successfully carry out their mission. applicable, the Commissions removes spectrum to support new broadband Furthermore, we seek to transition to an this part from its rules. applications such as high-speed digital technologies and wireless local area environment in which the public safety D. Designation of the 4.9 GHz Band for networks for incident scene community enjoys maximum access to Use in Support of Public Safety emerging broadband technologies. This management, dispatch operations, and action effectuates the transfer of this 5. The Commission concludes that the vehicular/personal communications, spectrum from Federal Government to 4.9 GHz band should be designated for and thus enables public safety providers non-Federal Government use pursuant use in support of public safety to more effectively, efficiently and to statutory requirements of the providing public safety users with safely serve their communities. In Omnibus Budget Reconciliation Act of access to state of the art technologies addition, our action may affect 1993. We also continue our ongoing that will enhance their critical indirectly equipment manufacturers by effort to streamline our Rules and operations capabilities. The acts of ultimately potentially increasing the eliminate redundancy by removing part terrorism committed against the United demand for their goods and services. 26 of our rules. States on September 11, 2001 reinforce Both of these effects are positive the critical nature of the public safety benefits, with no associated additional A. Allocation of the 4.9 GHz Band community’s responsibilities to our compliance burdens. Also, an indirect 2. The Commission allocates the 4.9 Nation’s safety and well being. affect of this allocation on some small GHz band to non-Government fixed and nevertheless, then numerous public entities is the potential enhancement of mobile services, excluding aeronautical safety entities have filed in this their protection from crime and hazards, mobile service, on a co-primary basis. proceeding supporting public safety use and of their receipt of emergency This allocation permits flexibility and a of the 4.9 GHz band to implement and services. wide range of fixed and mobile services. utilize the technologies described 8. Therefore, we certify that the The Commission allows licensees to previously. The record does not support requirements of this Second R&O will utilize this spectrum for any service the Commission’s previous tentative not have a significant economic impact permitted within any of the allocation conclusion, set forth, that the on a substantial number of small categories of fixed and mobile, to designation of spectrum in the 700 MHz entities. The Commission will send a include any fixed, land mobile, or band for public safety use obviates a copy of the Second R&O, including a maritime mobile service. The need to allocate spectrum in the 4.9 GHz copy of this final certification, in a Commission excludes aeronautical band for use in support of public safety. report to Congress pursuant to the mobile service from the entire 4.9 GHz Finally, we agree with Motorola that the Congressional Review Act, see U.S.C. band for the protection of radio Commission is not statutorily required 801(a)(1)(A). In addition, the Second astronomy operations in the 4950–4990 to use competitive bidding to license the R&O and this certification will be sent
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to the Chief Counsel for Advocacy of the and therefore is Removed, effective May PART 2—FREQUENCY ALLOCATIONS Small Business Administration, and 9, 2002. AND RADIO TREATY MATTERS; will be published in the Federal List of Subjects GENERAL RULES AND REGULATIONS Register. See U.S.C. 605(b). 47 CFR Part 2 1. The authority citation for part 2 III. Ordering Clauses continues to read as follows: Communications equipment, Radio. 9. Pursuant to sections 4(i), 303(r), Authority: 47 U.S.C. 154, 302(a), 303, and and 403 of the Communications Act of 47 CFR Part 26 336, unless otherwise noted. 1934, as amended, 47 U.S.C. 154(i), Communications common carrier, 2. Amend § 2.106, as follows: 303(r), 403, this Report and Order is Radio. a. Revise page 55. hereby adopted. Federal Communications Commission. b. In the list of United States (US) 10. Part 2 of the Commission’s rules footnotes, remove footnote US257 and William F. Caton, is amended as specified in rule changes revise footnote US311. and such rule amendments shall be Acting Secretary. c. In the list of Federal Government effective May 9, 2002. Rule Changes (G) Footnotes, revise footnote G122. 11. Pursuant to section 4(i) of the The revisions read as follows: Communications Act of 1934, as For the reasons discussed in the amended, 47 U.S.C. 154(i), that Part 26 preamble, the Federal Communications § 2.106 Table of Frequency Allocations. of the Commission’s rules, 47 CFR part Commission proposes to amend 47 CFR * * * * * 26, is no longer in the public interest, part 2 as follows: BILLING CODE 6712–01–P
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BILLING CODE 6712–01–C
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United States (US) Footnotes US311 Radio astronomy on an unprotected basis at the following observations may be made in the bands * * * * * radio astronomy observatories: 1350–1400 MHz and 4950–4990 MHz
Allen Telescope Array, Hat Creek, California ...... Rectangle between latitudes 40° 00′ N and 42° 00′ N and between lon- gitudes 120° 15′ W and 122° 15′ W. NASA Goldstone Deep Space Communications Complex, Goldstone, 80 kilometers (50 mile) radius centered on latitude 35° 18′ California. N, longitude 116° 54′ W. National Astronomy and Ionosphere Center, Arecibo, Puerto Rico ...... Rectangle between latitudes 17° 30′ N and 19° 00′ N and between lon- gitudes 65° 10′ W and 68° 00′ W. National Radio Astronomy Observatory, Socorro, New Mexico ...... Rectangle between latitudes 32° 30′ N and 35° 30′ N and between lon- gitudes 106° 00′ W and 109° 00′ W. National Radio Astronomy Observatory, Green Bank, West Virginia .... Rectangle between latitudes 37° 30′ N and 39° 15′ N and between lon- gitudes 78° 30′ W and 80° 30′ W.
National Radio Astronomy Observatory, Very 80 kilometers (50 mile) radius centered on:
Long Baseline Array Stations Latitude (North) Longitude (West)
Brewster, WA ...... 48° 08′ 119° 41′ Fort Davis, TX ...... 30° 38′ 103° 57′ Hancock, NH ...... 42° 56′ 71° 59′ Kitt Peak, AZ ...... 31° 57′ 111° 37′ Los Alamos, NM ...... 35° 47′ 106° 15′ Mauna Kea, HI ...... 19° 48′ 155° 27′ North Liberty, IA ...... 41° 46′ 91° 34′ Owens Valley, CA ...... 37° 14′ 118° 17′ Pie Town, NM ...... 34° 18′ 108° 07′ Saint Croix, VI ...... 17° 46′ 64° 35′
Owens Valley Radio Observatory, Big Pine, California Two contiguous rectangles, one between latitudes 36° 00′ N and 37° 00′ N and between longitudes 117° 40′ W and 118° 30′ W and the second between latitudes 37° 00′ N and 38° 00′ N and between lon- gitudes 118° 00′ W and 118° 50′ W.
Every practicable effort will be made to PART 26—[Removed] DATES: Effective May 9, 2002. avoid the assignment of frequencies in FOR FURTHER INFORMATION CONTACT: the bands 1350–1400 MHz and 4950– 3. Under the authority 47 U.S.C. 154, Andrew Firth, Attorney, Common 4990 MHz to stations in the fixed and amend 47 CFR chapter I by removing Carrier Bureau, Accounting Policy mobile services that could interfere with part 26. Division, (202) 418–2694. radio astronomy observations within the [FR Doc. 02–8482 Filed 4–8–02; 8:45 am] geographic areas given above. In BILLING CODE 6712–01–P SUPPLEMENTARY INFORMATION: This is a addition, every practicable effort will be summary of the Managing Director’s made to avoid assignment of frequencies Order in CC Docket Nos. 78–72 and 80– in these bands to stations in the FEDERAL COMMUNICATIONS 286, adopted on October 17, 2001 and aeronautical mobile service which COMMISSION released on October 18, 2001. The full operate outside of those geographic text of this document is available for 47 CFR Part 36 areas, but which may cause harmful public inspection during regular interference to the listed observatories. [CC Docket Nos. 78–72, 80–286; DA 01– business hours in the FCC Reference Should such assignments result in 2427] Center, Room CY–A257, 445 Twelfth harmful interference to these Street, SW., Washington, DC, 20554. observatories, the situation will be MTS and WATS Market Structure and 1. In this Order, pursuant to authority remedied to the extent practicable. Establishment of a Joint Board delegated to the Managing Director at * * * * * AGENCY: Federal Communications § 0.231(b) of the Commission’s rules, we make certain technical and non- Government (G) Footnotes Commission. ACTION: Final rule. substantive corrections to the * * * * * Commission’s part 36 jurisdictional G122 In the bands 2390–2400 MHz, SUMMARY: In this document, the Office separations rules to reflect a printing 2402–2417 MHz, and 4940–4990 MHz, of the Managing Director (Managing error brought to our attention by US Government operations may be Director) grants the petition of US West West Communications, Inc. (U.S. West) authorized on a non-interference basis Communications, Inc. (U.S. West) and in a Petition for Technical Corrections. to authorized non-Government makes technical revisions to the In its Petition, U.S. West notes that the Commission’s jurisdictional separations operations, but shall not hinder the Commission’s 1989 Decision and Order rules. Specifically, the Managing implementation of any non-Government in this docket (MTS and WATS Market Director amends the Commission’s rules operations. Structure, Amendment of Part 36 of the to correct misspellings and to remove Commission’s Rules and Establishment * * * * * certain text inadvertently added to a of a Joint Board, Decision and Order, CC rule section upon original publication in the Code of Federal Regulations.
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Docket Nos. 78–72 and 80–286, 4 FCC Federal Communications Commission. existing federal universal service Rcd. 5660), 54 FR 31032 (July 26, 1989), Katherine L. Schroder, contribution system. Inadvertently, in revised the description of Subcategory Division Chief, Telecommunications Access the heading and supplementary 1.1 of Category 1 Exchange Line Cable Policy Division, Wireline Competition Bureau. sections, the docket numbers were listed incorrectly. This document corrects the and Wire Facilities. Rule Changes docket numbers listed in the previous 2. US West notes that, when the document. revised rule as stated above was For the reasons discussed in the preamble, the Federal Communications published in the Federal Register and DATES: Effective April 12, 2002. Commission amends part 36 of title 47 adopted into the Code of Federal FOR FURTHER INFORMATION CONTACT: Paul of the Code of Federal Regulations as Regulations at 47 CFR 36.154(a), the Garnett, Attorney, Common Carrier follows: word ‘‘carrying’’ was misspelled as Bureau, Accounting Policy Division, ‘‘carring’’ and certain text was PART 36—JURISDICTIONAL (202) 418–7400. inadvertently added to the section. SEPARATIONS PROCEDURES; SUPPLEMENTARY INFORMATION: This summary contains corrections to the 3. Pursuant to the procedure set forth STANDARD PROCEDURES FOR headings section and the supplementary in § 0.231(b) of the Commission’s rules, SEPARATING section of the Commission’s Report and the Commission’s Common Carrier TELECOMMUNICATIONS PROPERTY COSTS, REVENUES, EXPENSES, Order, CC Docket Nos. 96–45, 98–171, Bureau (Bureau) has reviewed the US 90–571, 92–237, 99–200, 95–116, and West petition. As the Commission has TAXES AND RESERVES FOR TELECOMMUNICATIONS COMPANIES 98–170; FCC 02–43, 67 FR 11254 not adopted any modification to the rule (March 13, 2002). The full text of the that originally appeared in the 1989 Subpart B—Telecommunications Commission’s Report and Order is Decision and Order, the Bureau agrees Property available for public inspection during with US West that technical correction regular business hours in the FCC of 47 CFR 36.154(a) is appropriate and 1. The authority citation for part 36 Reference Center, Room CY–A257, 445 has approved this correction. We continues to read: Twelfth Street, SW., Washington, DC, therefore direct that the current Authority: 47 U.S.C. Secs. 151, 154 (i) and 20554. language found in the Code of Federal (j), 205, 221 (c), 254, 403 and 410. Correction Regulations at 47 CFR 36.154(a) be 2. In § 36.154(a), Subcategory 1.1 is In rule FR Doc. 02–6028 published on amended to reflect exactly the original revised to read as follows: language in the 1989 Decision and March 13, 2002 (67 FR 11254), make the Order. Because the amendment we are § 36.154. Exchange Line Cable and Wire following corrections: making is merely a technical correction Facilities (C&WF)—Category 1— 1. On page 11254, in the second Apportionment Procedures. column, ‘‘[CC Docket Nos. 96–45, 98– that does not alter the substance of the 77, 90–571, 92–237, 99–200, and 95– rule, we find, for good cause, that notice (a) * * * 116; FCC 02–43]’’ is corrected to read and comment under the Administrative Subcategory 1.1—State Private Lines ‘‘[CC Docket Nos. 96–45, 98–171, 90– Procedure Act is not necessary. and State WATS Lines. This subcategory shall include all private 571, 92–237, 99–200, 95–116, and 98– Ordering Clause lines and WATS lines carrying 170; FCC 02–43]’’. exclusively state traffic as well as 2. On page 11254, in the second 4. Pursuant to sections 1–2, 4, 201– private lines and WATS lines carrying column in the last paragraph, ‘‘CC 205, 215, 218, 220, 229, 254 and 410 of both state and interstate traffic if the Docket Nos. 96–45, 98–171, 90–571, 92– the Communications Act of 1934, as interstate traffic on the line involved 237, 99–200, and 95–’’ is corrected to amended, 47 U.S.C. 151, 152, 154, 201– constitutes ten percent or less of the read ‘‘CC Docket Nos. 96–45, 98–171, 205, 215, 218, 220, 229, 254, and 410, total traffic on the line. 90–571, 92–237, 99–200, 95–116,’’. 3. On page 11254, in the third column the Administrative Procedure Act, 5 * * * * * U.S.C. 533(b)(3)(B), and pursuant to in the first line, ‘‘116, FCC 02–43’’ is [FR Doc. 02–8498 Filed 4–8–02; 8:45 am] corrected to read ‘‘and 98–170; FCC 02– authority delegated to the Managing BILLING CODE 6712–01–P Director at section 0.231(b) of the 43’’. Commission’s rules, 47 CFR 0.231(b), Federal Communications Commission. that the Petition for Technical FEDERAL COMMUNICATIONS William F. Caton, Corrections filed by US West, COMMISSION Acting Secretary. Communications Inc. on February 16, [FR Doc. 02–8481 Filed 4–8–02; 8:45 am] 47 CFR Part 54 2000, is granted. BILLING CODE 6712–01–P 5. The non-substantive technical [CC Docket No. 96–45, 98–171, 90–571, 92– correction to the Code of Federal 237, 99–200, 95–116, and 98–170; FCC 02– FEDERAL COMMUNICATIONS Regulations, specifically at 47 CFR 43] COMMISSION 36.154(a), as outlined in the Rule Federal-State Joint Board on Universal Changes, is adopted. Service 47 CFR Part 73 List of CFR Subjects 47 CFR Part 36 AGENCY: Federal Communications [FCC 02–35, MM Docket No. 90–66, RM– 7139, RM–7368, RM–7369] Communications common carriers, Commission. Reporting and recordkeeping ACTION: Final rule; correction. FM Broadcasting Services; Lincoln, requirements, Telephone, Uniform Osage Beach, Steelville, and Warsaw, SUMMARY: System of Accounts. The Federal Communications MO Commission published in the Federal Register of March 13, 2002, a document AGENCY: Federal Communications concerning certain modifications, to the Commission.
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ACTION: Final rule; application for One Sound’s counterproposal was Authority: 47 U.S.C. 151, 152, 153, 154, review denied. properly dismissed. 301, 302, 303, 303a, 307, 308, 309, 312, 315, 317, 325, 336, 338, 339, 503, 521, 522, 531, SUMMARY: In this proceeding involving List of Subjects in 47 CFR Part 73 532, 533, 534, 535, 536, 537, 543, 544, 544a, mutually exclusive proposals to amend Radio broadcasting. 545, 548, 549, 552, 554, 556, 558, 560, 561, the FM Table of Allotments, the 571, 572, 573. Commission affirmed the staff’s Federal Communications Commission. William F. Caton, 2.Revise paragraphs (j), (k) and (l) of dismissal of a counterproposal filed by § 76.64 to read as follows: Twenty-One Sound Communications to Acting Secretary. upgrade its Station KNSX(FM), [FR Doc. 02–8480 Filed 4–8–02; 8:45 am] § 76.64 Retransmission consent. Steelville, Missouri, from Channel BILLING CODE 6712–01–P * * * * * 227C2 to Channel 227C1 for failure to comply with the verification (j) Retransmission consent agreements requirements of Section 1.52 of the FEDERAL COMMUNICATIONS between a broadcast station and a Commission’s Rules. The Commission COMMISSION multichannel video programming also affirmed the grant of a mutually distributor shall be in writing and shall exclusive proposal to upgrade Station 47 CFR Part 76 specify the extent of the consent being KYLC(FM), Osage Beach, Missouri, from granted, whether for the entire signal or Channel 228A to Channel 228C3. See 62 [CS Docket No. 98–120, CS Docket No. 00– any portion of the signal. This rule 96; CS Docket No. 00–2, FCC 01–22] FR 25557 (May 9, 1997) and 61 FR applies for either the analog or the digital signal of a television station. 29311 (June 10, 1996). See also Carriage of Digital Television Supplemental Information. Broadcast Signals (k) A cable system commencing new FOR FURTHER INFORMATION CONTACT: operation is required to notify all local Andrew J. Rhodes, Media Bureau, (202) AGENCY: Federal Communications commercial and noncommercial 418–2180. Commission. broadcast stations of its intent to SUPPLEMENTARY INFORMATION: This is a ACTION: Correcting amendments. commence service. The cable operator summary of the Memorandum Opinion must send such notification, by certified and Order, MM Docket 90–66, adopted SUMMARY: This document makes a mail, at least 60 days prior to February 8, 2002, and released March number of minor corrections to the commencing cable service. Commercial 25, 2002. The full text of this Commission rules pertaining to broadcast stations must notify the cable Commission decision is available for retransmission consent which were system within 30 days of the receipt of inspection and copying during normal published in the Federal Register of such notice of their election for either business hours in the Commission’s Monday March 26, 2001 (66 FR 16533) must-carry or retransmission consent Reference Information Center (room regarding carriage of digital television with respect to such new cable system. CY–A257), 445 12th Street, SW., broadcast signals. If the commercial broadcast station Washington, DC 20554. The complete DATES: Effective April 9, 2002. elects must-carry, it must also indicate text of this decision may be also FOR FURTHER INFORMATION CONTACT: its channel position in its election purchased from the Commission’s copy Kenneth Lewis, Media Bureau, (202) statement to the cable system. Such contractor, Qualex International Portals 418–2622. election shall remain valid for the remainder of any three-year election II, 445 12th Street, SW., Room CY–B402, SUPPLEMENTARY INFORMATION: The First interval, as established in § 76.64(f)(2). Washington, DC, 20554. Report and Order, FCC 01–22, adopted Section 1.52 of the Commission’s Noncommercial educational broadcast January 18, 2001; released January 23, Rules requires that the original of any stations should notify the cable operator 2001, approved a final rule for carriage document filed with the Commission by of their request for carriage and their of digital television broadcast signals. In a party not represented by counsel be channel position. The new cable system this document we make non-substantive signed and verified by the party and his must notify each station if its signal rules changes to correct errors in the or her address stated. Since Twenty-One quality does not meet the standards for publication of §76.64 of the Sound had failed to include an affidavit carriage and if any copyright liability Commission’s rules. verifying that the statements contained would be incurred for the carriage of in its counterproposal were true to the Need for Correction such signal. Pursuant to § 76.57(e), a best of its knowledge, the As published, the final regulations commercial broadcast station which counterproposal was dismissed. contain errors which may prove to be fails to respond to such a notice shall be Twenty-One Sound had contended that misleading and need to be clarified. deemed to be a must-carry station for the rule was unfairly applied to its the remainder of the current three-year counterproposal because it was filed List of Subjects in 47 CFR Part 76 election period. before the Commission had announced Retransmission consent. (l) Exclusive retransmission consent that it would strictly apply the agreements are prohibited. No television verification rule in allotment Federal Communications Commission. broadcast station shall make or negotiate proceedings. The Commission William F. Caton, any agreement with one multichannel disagreed, finding that in situations Acting Secretary. video programming distributor for where the Commission waived the carriage to the exclusion of other verification rule, it had done so if there Accordingly, 47 CFR part 76 is multichannel video programming would not be prejudice to another corrected by making the following distributors. This paragraph shall mutually exclusive proposal that had correcting amendments: terminate at midnight on December 31, complied with the Commission’s Rules. PART 76—MULTICHANNEL VIDEO 2005. Since waiver of the verification rule in AND CABLE TELEVISION SERVICE this case would prejudice a party that * * * * * had filed a proposal compliant with the 1.The authority citation for Part 76 [FR Doc. 02–8558 Filed 4–8–02; 8:45 am] Commission’s technical rules, Twenty- continues to read as follows: BILLING CODE 6712–01–P
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NATIONAL AERONAUTICS AND revised guidance requires use of a Safety 1823.7001 NASA solicitation provisions SPACE ADMINISTRATION and Health clause and submission of a and contract clauses. Safety and Health Plan when (a) The clause at 1852.223–70, Safety 48 CFR Parts 1823, 1836 and 1852 performance is on a Government facility and Health, shall be included in all RIN 2700–AC33 or when assessed risk warrants solicitations and contracts when one or inclusion. This final rule also revises more of the following conditions exist: Safety and Health the conditions that must be met for (1) The work will be conducted excluding the clause from contracts, completely or partly on premises owned AGENCY: National Aeronautics and reflecting the greater Government and or controlled by the Government. Space Administration (NASA). industry use of Occupational Safety and (2) The work includes construction, ACTION: Final rule. Health Administration (OSHA) and alteration, or repair of facilities in Department of Transportation (DOT), excess of the simplified acquisition SUMMARY: This final rule amends the rather than Walsh-Healey or Service threshold. NASA FAR Supplement (NFS) by Contract Act safety and heath (3) The work, regardless of place of revising the prescription for the use of regulations, and includes new NFS performance, involves hazards that NASA Safety and Health solicitation guidance on use of the NASA Safety and could endanger the public, astronauts provisions and contract clauses; Health clause instead of the FAR and pilots, the NASA workforce removing references to the Service Accident Prevention clause. (including contractor employees Contract Act (SCA) and Walsh-Healey Furthermore, this final rule makes the working on NASA contracts), or high Public Contracts Act regulations; adding requirements for the use of the NASA value equipment or property, and the references to the Occupational Safety Safety and Health clause for hazards are not adequately addressed by and Health Act (OSHA) and Department subcontracts consistent with prime Occupational Safety and Health of Transportation (DOT) regulations; contract requirements. Administration (OSHA) or Department and clarifying when a Safety and Health of Transportation (DOT) regulations (if Plan is to be included in a contract or B. Regulatory Flexibility Act applicable). solicitation. This final rule also requires NASA certifies that this rule will not (4) When the assessed risk and the use of NASA’s safety and health have a significant economic impact on consequences of a failure to properly provisions instead of the FAR Accident a substantial number of small business manage and control the hazard(s) Prevention clause, and allows for oral entities within the meaning of the warrants use of the clause. notification, with written confirmation Regulatory Flexibility Act (5 USC 601, (b) The clause prescribed in paragraph to the contractor, of Safety and Health et seq.) because these changes clarify (a) of this section may be excluded, noncompliance that may pose a serious existing policy and reflect appropriate regardless of place of performance, or imminent danger to safety and health. safety and health regulations. when the contracting officer, with the EFFECTIVE DATE: April 9, 2002. approval of the installation official(s) C. Paperwork Reduction Act FOR FURTHER INFORMATION CONTACT: Jeff responsible for matters of safety and Cullen, (202) 358–1784, The Paperwork Reduction Act does occupational health, determines that the [email protected]. not apply because the changes to the application of OSHA and DOT NFS do not impose any recordkeeping regulations constitutes adequate safety SUPPLEMENTARY INFORMATION: or information collection requirements, and occupational health protection. A. Background or collections of information from * * * * * A proposed rule was published in the offerors, contractors, or members of the public which require the approval of the PART 1836—CONSTRUCTION AND Federal Register on December 13, 2001 ARCHITECT-ENGINEER CONTRACTS (66 FR 64391–64392). One comment Office of Management and Budget under was received from industry. The 41 U.S.C. 3501, et seq. 3. Add section 1836.513 to read as comment was supportive of the rule and List of Subjects in 48 CFR Parts 1823, follows: did not recommended any changes. This 1836 and 1852 1836.513 Accident prevention. final rule adopts the proposed rule without change. NASA has required the Government procurement. The contracting officer must insert the inclusion of a NASA Safety and Health clause at 1852.223–70, Safety and Tom Luedtke, clause and submission of a contractor Health, in lieu of FAR clause 52.236–13, Safety and Health Plan for contracts that Assistant Administrator for Procurement. Accident Prevention, and its Alternate I. Accordingly, 48 CFR parts 1823, 1836 are greater than $1 million, involve PART 1852—SOLICITATION and 1852 are amended as follows: construction, or have hazardous PROVISIONS AND CONTRACT deliverable end items or operations. 1. The authority citation for 48 CFR CLAUSES Exclusion of the clause has been parts 1823, 1836 and 1852 continues to allowed when the Contracting Officer read as follows: 4. Amend the clause at section determined that Walsh-Healey or 1852.223–70 by revising the date of the Service Contract Act (if applicable) Authority: 42 U.S.C. 2473(c)(1). clause; revising paragraphs (f)(1) and (g); regulations constituted adequate safety PART 1823—ENVIRONMENT, redesignating paragraphs (h) and (i) as and health protection. This final rule CONSERVATION, OCCUPATIONAL (i) and (j) respectively, and adding a removes the dollar threshold from the SAFETY, AND DRUG-FREE new paragraph (h) to read as follows: Safety and Health clause prescription WORKPLACE since safety and health requirements 1852.223–70 Safety and Health. should be determined by the risks rather 2. Amend section 1823.7001 in the * * * * * than cost of the contract requirements. second sentence of paragraph (c) by Safety and Health (April 2002) Also, to assure that contractors are held removing ‘‘clause’’ and adding * * * * * to the same standards for mishap ‘‘provision’’ in its place; and revising (f)(1) The Contracting Officer may notify prevention as the Government, the paragraphs (a) and (b) to read as follows: the Contractor in writing of any
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noncompliance with this clause and specify a solicitation and subcontract, the Contractor Manual, Appendices). The plan shall include corrective actions to be taken. When the must notify and provide the basis for the a detailed discussion of the policies, Contracting Officer becomes aware of determination to the Contracting Officer. In procedures, and techniques that will be used noncompliance that may pose a serious or subcontracts of every tier above the micro- to ensure the safety and occupational health imminent danger to safety and health of the purchase threshold for which paragraph (g) of Contractor employees and to ensure the public, astronauts and pilots, the NASA does not apply, the Contractor (or safety of all working conditions throughout workforce (including contractor employees subcontractor or supplier) shall insert the the performance of the contract. working on NASA contracts), or high value substance of paragraphs (a), (b), (c), and (f) (b) When applicable, the plan shall address mission critical equipment or property, the of this clause). the policies, procedures, and techniques that Contracting Officer shall notify the * * * * * will be used to ensure the safety and Contractor orally, with written confirmation. 5. Amend the clause at section occupational health of the public, astronauts The Contractor shall promptly take and and pilots, the NASA workforce (including report any necessary corrective action. 1852.223–72 by revising the date of the clause, and revising paragraph (d) to Contractor employees working on NASA * * * * * contracts), and high-value equipment and read as follows: (g) The Contractor (or subcontractor or property. supplier) shall insert the substance of this 1852.223–72 Safety and Health (Short (c) The plan shall similarly address clause, including this paragraph (g) and any Form). subcontractor employee safety and applicable Schedule provisions and clauses, occupational health for those proposed with appropriate changes of designations of * * * * * subcontracts that contain one or more of the the parties, in all solicitations and Safety and Health (Short Form) (April 2002) following conditions: subcontracts of every tier, when one or more * * * * * (1) The work will be conducted completely of the following conditions exist: (d) The Contracting Officer may notify the or partly on premises owned or controlled by (1) The work will be conducted completely Contractor in writing of any noncompliance the government. or partly on premises owned or controlled by with this clause and specify corrective (2) The work includes construction, the Government. actions to be taken. In situations where the alteration, or repair of facilities in excess of (2) The work includes construction, Contracting Officer becomes aware of the simplified acquisition threshold. alteration, or repair of facilities in excess of noncompliance that may pose a serious or (3) The work, regardless of place of the simplified acquisition threshold. imminent danger to safety and health of the performance, involves hazards that could (3) The work, regardless of place of public, astronauts and pilots, the NASA endanger the public, astronauts and pilots, performance, involves hazards that could workforce (including Contractor employees the NASA workforce (including Contractor endanger the public, astronauts and pilots, working on NASA contracts), or high value employees working on NASA contracts), or the NASA workforce (including Contractor mission critical equipment or property, the high value equipment or property, and the employees working on NASA contracts), or Contracting Officer shall notify the hazards are not adequately addressed by high value equipment or property, and the Contractor orally, with written confirmation. Occupational Safety and Health hazards are not adequately addressed by The Contractor shall promptly take and Administration (OSHA) or Department of Occupational Safety and Health report any necessary corrective action. The Transportation (DOT) regulations (if Administration (OSHA) or Department of Government may pursue appropriate applicable). Transportation (DOT) regulations (if remedies in the event the Contractor fails to (4) When the assessed risk and applicable). promptly take the necessary corrective consequences of a failure to properly manage (4) When the Contractor (or subcontractor action. and control the hazards warrants use of the or supplier) determines that the assessed risk clause. and consequences of a failure to properly * * * * * (d) This plan, as approved by the manage and control the hazard(s) warrants 6. Revise the provision at section Contracting Officer, will be included in any use of the clause. 1852.223–73 and the introductory text resulting contract. (h) The Contractor (or subcontractor or of Alternate I to the provision to read as (End of provision) supplier) may exclude the provisions of follows: paragraph (g) from its solicitation(s) and Alternate I (April 2002) subcontract(s) of every tier when it 1852.223–73 Safety and Health Plan. As prescribed in 1823.7001(c), delete the determines that the clause is not necessary * * * * * first sentence in paragraph (a) of the basic because the application of the OSHA and provision and substitute the following: DOT (if applicable) regulations constitute Safety and Health Plan (April 2002) adequate safety and occupational health (a) The offeror shall submit a detailed * * * * * protection. When a determination is made to safety and occupational health plan as part [FR Doc. 02–8548 Filed 4–8–02; 8:45 am] exclude the provisions of paragraph (g) from of its proposal (see NPG 8715.3, NASA Safety BILLING CODE 7510–01–P
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Proposed Rules Federal Register Vol. 67, No. 68
Tuesday, April 9, 2002
This section of the FEDERAL REGISTER The representative period for than one week before the end of the contains notices to the public of the proposed establishing voter eligibility for the registration period. Prior to the first day issuance of rules and regulations. The referendum shall be the period from of the voting period, the referendum purpose of these notices is to give interested January 1, 2000, through December 31, agents will mail the ballots to be cast in persons an opportunity to participate in the 2001 (two years). Persons who are the referendum and voting instructions rule making prior to the adoption of the final rules. producers or importers of Hass avocados to all registered voters. Persons who are at the time of the referendum and producers or importers at the time of the during the representative period are referendum and during the DEPARTMENT OF AGRICULTURE eligible to vote. Producers and importers representative period are eligible to must register with the U.S. Department vote. Any eligible producer or importer Agricultural Marketing Service of Agriculture (Department) in order to who does not receive a ballot should receive a ballot to vote in the contact the referendum agents no later 7 CFR Part 1219 referendum. Registration will be than one week before the end of the conducted by mail and by fax. The [Docket No. FV–01–705 RO] voting period. Ballots must be received referendum shall be conducted by mail by the referendum agents on or before Hass Avocado Promotion, Research, ballot and by fax from June 24 through July 12, 2002, to be counted. July 12, 2002. Ballots must be received and Information Order; Referendum List of Subjects in 7 CFR Part 1219 Order by the referendum agent no later than July 12, 2002, to be counted. Advertising, Agricultural research, AGENCY: Agricultural Marketing Service, Section 1206(a) of the Act requires the Hass avocados, Imports, Reporting and Agriculture. Department to conduct a referendum recordkeeping requirements. ACTION: Referendum order. prior to the Order’s effective date and that the Order shall become effective Authority: 7 U.S.C. 7801–7813. SUMMARY: This document directs that a only if it is determined that the Order Dated: April 3, 2002. referendum be conducted among has been approved by a simple majority A.J. Yates, eligible producers and importers of Hass of all votes cast in a referendum. avocados to determine whether they Administrator, Agricultural Marketing In accordance with the Paperwork Service. favor implementation of the Hass Reduction Act of 1995 [44 U.S.C. [FR Doc. 02–8547 Filed 4–8–02; 8:45 am] Avocado Promotion, Research, and Chapter 35], the referendum ballot has BILLING CODE 3410–02–P Information Order (Order). been approved by the Office of DATES: The registration period will be Management and Budget (OMB) and from May 13 through May 31, 2002. The assigned OMB No. 0581–0197. It is DEPARTMENT OF AGRICULTURE referendum will be conducted from June estimated that there are approximately 24 to July 12, 2002. To vote in this 6,000 producers and 200 importers who Rural Utilities Service referendum, current producers and will be eligible to vote in the importers must have produced or referendum. It will take an average of 15 7 CFR Part 1710 imported Hass avocados during the minutes for each producer and importer period from January 1, 2000, through to read the registration instructions and RIN 0572–AB80 December 31, 2001 (two years). register for the referendum. It will take ADDRESSES: Copies of the Order may be an average of 15 minutes for each Useful Life of Facility Determination obtained from: Referendum Agent, registered producer and importer to read Research and Promotion Branch (RP), the voting instructions and complete the AGENCY: Rural Utilities Service, USDA. Fruit and Vegetable Programs (FV), referendum ballot. ACTION: Proposed rule. AMS, USDA, Stop 0244, Room 2535–S, Referendum Order 1400 Independence Avenue, SW., SUMMARY: The Rural Utilities Service Washington, DC 20250–0244. Julie A. Morin, Margaret B. Irby, and Martha B. Ransom, RP, FV, AMS, (RUS) proposes to eliminate the FOR FURTHER INFORMATION CONTACT: Julie USDA, Stop 0244, Room 2535–S, 1400 requirement to use depreciation rates as A. Morin, RP, FV, AMS, USDA, Stop Independence Avenue, SW., found in Bulletin 183–1, for 0244, Room 2535–S, 1400 Independence Washington, DC 20250–0244, are determining the useful life of a facility. Avenue, SW., Washington, DC 20250– designated as the referendum agents to If the proposed useful life of a facility 0244, telephone 888–720–9917 (toll conduct this referendum. The is deemed inappropriate by RUS, other free), fax 202–205–2800, e-mail referendum procedures [7 CFR 1219.100 means to establish an appropriate term [email protected]. through 1219.109], which were issued for the loan will apply. Current reliance SUPPLEMENTARY INFORMATION: Pursuant pursuant to the Act, shall be used to on the fixed range of depreciation rates to the Hass Avocado Promotion, conduct the referendum. found in Bulletin 183–1, to be used Research, and Information Act (Act) [7 The referendum agents will mail across the country, has been determined U.S.C. 7801–7813], it is hereby directed registration instructions to all known to not be as appropriate as looking at that a referendum be conducted to Hass avocado producers and importers proposals on a case-by-case basis. This ascertain whether implementation of the in advance of the referendum. Any proposed rule is made as part of the Order is favored by Hass avocado producer or importer who does not RUS efforts to continually look for ways producers and importers. The Order is receive registration instructions should to streamline lending requirements and authorized under the Act. contact the referendum agents no later make regulations useful and direct.
VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00001 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Proposed Rules 17019
DATES: Written comments must be Regulatory Flexibility Act Certification useful life of a facility to be financed, received by RUS or carry a postmark or In accordance with the Regulatory current regulations require that the equivalent no later than May 9, 2002. Flexibility Act (5 U.S.C. 601 et seq.), the useful life determination be consistent with the borrower’s proposed ADDRESSES: Written comments should Administrator of RUS has determined depreciation rates for facilities. If the be addressed to F. Lamont Heppe, Jr., that this rule will not have significant impact on a substantial number of small depreciation rates are deemed Director, Program Development and inappropriate by RUS, then the Regulatory Analysis, Rural Utilities entities. The RUS electric loan program provides loans and loan guarantees to depreciation rates listed in RUS Bulletin Service, U.S. Department of Agriculture, 183–1 will apply. RUS Bulletin 183–1, STOP 1522, 1400 Independence Ave., borrowers at interest rates and terms that are more favorable than those last updated in 1977, provides the SW., Washington, DC 20250–1522. RUS borrower depreciation rates by asset requests a signed original and three generally available from the private sector. Small entities are not subjected class, which is meant to be used by all copies of all comments (7 CFR 1700.4). borrowers across the country. The Comments will be available for public to any requirements, which are not applied equally to large entities. RUS standard depreciation rates that are inspection during regular business published in Bulletin 183–1 are hours (7 CFR 1.27(b)). borrowers, as a result of obtaining federal financing, receive economic presented as a range of rates to allow for FOR FURTHER INFORMATION CONTACT: benefits that exceed any direct cost the recognition of locational and Patrick R. Sarver, Management Analyst, associated with RUS regulations and situational differences. Depreciation is the allocation of asset Rural Utilities Service, Electric Program, requirements. Room 4024 South Building, Stop 1560, costs over the period that the asset 1400 Independence Ave., SW., Information Collection and provides a benefit. The system of Washington, DC 20250–1560, Recordkeeping Requirements allocation should correctly match cost Telephone: 202–690–2992, FAX: 202– This rule contains no additional with related revenue, while recognizing 690–0717, E-mail: information collection or recordkeeping the declining service value of the asset. [email protected]. requirements under OMB control Both use and usefulness of the asset number 0572–0032 that would require influence the rate of depreciation. SUPPLEMENTARY INFORMATION: approval under the Paperwork Appropriate determination of depreciation for a particular asset Executive Order 12866 Reduction Act of 1995 (44 U.S.C. Chapter 35). should consider the past experience This proposed rule has been with similar assets, the asset’s present determined to be not significant for Unfunded Mandates condition and the factory’s maintenance purposes of Executive Order 12866 and, This proposed rule contains no policy. Other considerations include therefore, has not been reviewed by the Federal mandates (under the regulatory technological and industry trends, and Office of Management and Budget provision of title II of the Unfunded local environmental conditions. (OMB). Mandates Reform Act of 1995) for State, In the electric utility industry local, and tribal governments or the depreciation is designed to allocate the Executive Order 12372 private sector. Thus, this proposed rule costs of electric plant, including net salvage (cost of removal less salvage), This rule is excluded from the scope is not subject to the requirements of over the estimated useful life of the of Executive Order 12372, sections 202 and 205 of the Unfunded Mandates Reform Act. plant. The depreciation rates, therefore, Intergovernmental Consultation, which include components for estimated cost may require consultation with State and National Environmental Policy Act of removal and net salvage. In recent local officials. See the final rule related Certification years net salvage has, in many cases, notice titled ‘‘Department Programs and become a significant factor in Activities Excluded from Executive The Administrator of RUS has determined that this proposed rule will depreciation rates. As a result, without Order 12372’’ (50 FR 47034) advising knowing the net salvage components the that RUS loans and loan guarantees not significantly affect the quality of the human environment as defined by the depreciation rates cannot readily be were not covered by Executive Order converted to determine the estimated 12372. National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). Therefore, useful life of electric plant. Executive Order 12988 this action does not require an Because of the growing difficulty in environmental impact statement or determining the net salvage value and This proposed rule has been reviewed assessment. the resulting difficulty in accurately under Executive Order 12988, Civil determining useful life, RUS is Justice Reform. RUS has determined Catalog of Federal Domestic Assistance proposing to eliminate the requirement that this proposed rule meets the The program described by this for a useful life determination based applicable standards provided in proposed rule is listed in the Catalog of upon the depreciation rates as found in section 3 of the Executive Order. In Federal Domestic Assistance Programs Bulletin 183–1. If the useful life being addition, all state and local laws and under No. 10.850, Rural Electrification proposed by the borrower is not regulations that are in conflict with this Loans and Loan Guarantees. This satisfactory to RUS, the depreciation rule will be preempted; no retroactive catalog is available on a subscription rates listed in RUS Bulletin 183–1 will effect will be given to this rule, and, in basis from the Superintendent of no longer be used in lieu there of. accordance with section 212(e) of the Documents, U.S. Government Printing Instead, RUS proposes using an Department of Agriculture Office, Washington, DC 20402–9325, independent evaluation, the Reorganization Act of 1994 (7 U.S.C. telephone number (202) 512–1800. manufacturer’s estimated useful-life or 6912 (e)), administrative appeals RUS experience with like-property as procedures, if any are required, must be Background alternatives to an unsatisfactory exhausted before an action against the RUS is authorized to make loans and proposal made by the borrower. RUS Department or its agencies may be loan guarantees with a final maturity of views this new back-stop approach to initiated. up to 35 years. When determining the reviewing and approving the
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determination of the useful life of a proposed by the borrower is not deemed Laboratories to review its $6 million facility as a more appropriate method. appropriate by RUS, RUS will base size standard. These firms believe that The increased difficulties in expected useful life on an independent a size standard increase is warranted in establishing net salvage values and evaluation, the manufacturer’s light of the high level capacities and recent experience in using the fixed estimated useful-life or RUS experience skills that Federal agencies have range of depreciation rates as found in with like-property, as applicable. Final recently required among their vendors Bulletin 183–1, dictates a more flexible maturities for loans for the that specialize in environmental and approach. implementation of programs for demand radiochemical testing. They believe that The RUS is proposing this change to side management and energy resource the minimum government requirements regulations as part of its ongoing effort conservation and on and off grid may have raised the costs of doing to minimize administrative burden, renewable energy sources not owned by business in this industry to the point streamline the loan process, and update the borrower will be determined by that the pool of eligible small businesses regulations to reflect current RUS. Due to the uncertainty of in this activity has seriously declined. If requirements. This proposed change in predictions over an extended period of this trend continues, it is argued, regulations will provide greater latitude time, RUS may add up to 2 years to the Federal agencies could be hampered in in establishing the useful life of a composite average useful life of the using government preference programs facility being financed but at the same facilities in order to determine final for small business. Below is a time maintain RUS approval for making maturity. discussion of SBA’s size standards the determination. * * * * * methodology and the analysis leading to the proposal to increase the Testing List of Subjects in 7 CFR Part 1710 Dated: March 27, 2002. Laboratories size standard to $10 Electric power, Electric utilities, Loan Blaine D. Stockton, million. programs—energy, Reporting and Acting Administrator, Rural Utilities Service. (Effective February 22, 2002, the recordkeeping requirements, Rural [FR Doc. 02–8484 Filed 4–8–02; 8:45 am] Testing Laboratories size standard areas. BILLING CODE 3410–15–P increased from $5 million to $6 million For the reasons set forth in the as part of an inflation adjustment to preamble, chapter XVII of title 7 of the SBA’s monetary size standards (see 67 Code of Federal Regulations, is SMALL BUSINESS ADMINISTRATION FR 3041, dated January 23, 2002. This proposed to be amended as follows: rule proposes a further increase to the 13 CFR Part 121 size standard based on an analysis of the PART 1710—GENERAL AND PRE- characteristics of businesses in the LOAN POLICIES AND PROCEDURES RIN 3245–AE78 Testing Laboratories industry.) COMMON TO INSURED AND Small Business Size Standards; Size Standards Methodology: GUARANTEED ELECTRIC LOANS Congress has granted SBA discretion to Testing Laboratories establish detailed size standards. SBA’s 1. The authority citation for part 1710 AGENCY: Small Business Administration Standard Operating Procedure (SOP) 90 continues to read as follows: (SBA). 01 3, ‘‘Size Determination Program,’’ Authority: 7 U.S.C. 901 et seq., 1921 et ACTION: Proposed rule. available on SBA’s web site at http:/ seq., 6941 et seq. www.sba.gov/library/soproom.html, sets SUMMARY: The Small Business out four categories for establishing and Subpart C—Loan Purposes and Basic Administration (SBA) is proposing to evaluating size standards: (1) The Policies increase the size standard for the structure of the industry and its various 2. Amend § 1710.115 by revising Testing Laboratories industry (North economic characteristics, (2) SBA paragraph (b) to read as follows: American Industry Classification program objectives and the impact of System (NAICS) code 541380) to $10 different size standards on these § 1710.115 Final maturity. million in average annual receipts. The programs, (3) whether a size standard * * * * * current size standard for this industry is successfully excludes those businesses (b) Loans made or guaranteed by RUS $6 million in average annual receipts. which are dominant in the industry, and for facilities owned by the borrower The proposed revision is being made to (4) other factors if applicable. Other generally must be repaid with interest better define the size of businesses in factors, including the impact on other within a period, up to 35 years, that this industry that SBA believes should agencies’ programs, may come to the approximates the expected useful life of be eligible for Federal small business attention of SBA during the public the facilities financed. The expected assistance programs. comment period or from SBA’s own useful life shall be based on the DATES: Comments must be submitted on research on the industry. No formula or weighted average of the useful lives that or before June 10, 2002. weighting has been adopted so that the the borrower proposes for the facilities factors may be evaluated in the context ADDRESSES: Send comments to Gary M. financed by the loan, provided that the of a specific industry. Below is a Jackson, Assistant Administrator for proposed useful lives are deemed discussion of SBA’s analysis of the appropriate by RUS. RUS Form 740c, Size Standards, 409 3rd Street, SW, Mail economic characteristics of an industry, Cost Estimates and Loan Budget for Code 6530, Washington, DC 20416; or the impact of a size standard on SBA Electric Borrowers, submitted as part of via email to [email protected]. programs, and the evaluation of whether the loan application must include, as a Upon request, SBA will make all public a firm at or below a size standard could note, either a statement certifying that at comments available. be considered dominant in the industry least 90 percent of the loan funds are for FOR FURTHER INFORMATION CONTACT: under review. facilities that have a useful life of 33 Robert N. Ray, Office of Size Standards, Industry Analysis: The Small years or longer, or a schedule showing (202) 205–6618. Business Act, 15 U.S.C. 632(a)(3), the costs and useful life of those SUPPLEMENTARY INFORMATION: The Small requires that size standards vary by facilities with a useful life of less than Business Administration (SBA) has industry to the extent necessary to 33 years. If the useful life determination received requests from Testing reflect differing industry characteristics
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(Section 3(a)(3)). SBA has in place two most important evaluation factors in 3. Start-up costs affect a firm’s initial ‘‘base or anchor size standards’’ that establishing or revising a size standard size because entrants into an industry apply to most industries. SBA for an industry. However, it will also must have sufficient capital to start and established 500 employees as the anchor consider and evaluate other information maintain a viable business. To the size standard for the manufacturing that it believes relevant to the decision extent that firms entering into an industries at SBA’s inception in 1953, on a size standard as the situation industry have greater financial and shortly thereafter established a $1 warrants for a particular industry. These requirements than firms in other million size standard for the can include the impact of a revision on industries, SBA is justified in nonmanufacturing industries. The other agencies’ programs. Public considering a higher size standard. In receipts-based anchor size standard for comments submitted on proposed size lieu of direct data on start-up costs, SBA the nonmanufacturing industries was standards are also an important source is using a special measure to assess the periodically adjusted for inflation so of additional information that SBA financial burden for entry-level firms. that, currently, the anchor size standard closely reviews before making a final SBA is using nonpayroll costs per for the nonmanufacturing industries is decision on a size standard. Below is a establishment as a proxy measure for $6 million. Anchor size standards are brief description of each of the five start-up costs associated with capital presumed to be appropriate for an evaluation factors. investment requirements. This is industry unless its characteristics 1. Average firm size is simply total derived by first calculating the percent indicate that larger firms have a much industry receipts (or number of of receipts in an industry that are either greater significance within that industry employees) divided by the number of retained or expended on costs other than for the ‘‘typical industry.’’ firms in the industry. If the average firm than payroll costs. (The figure When evaluating a size standard, the size of an industry is significantly characteristics of the specific industry comprising the numerator of this higher than the average firm size of a percentage is mostly composed of under review are compared to the comparison industry group, this fact characteristics of a group of industries, capitalization costs, overhead costs, would be viewed as supporting a size materials costs, and the costs of goods referred to as a comparison group. A standard higher than the anchor size comparison group is a large number of sold or inventoried.) This percentage is standard. Conversely, if the industry’s then applied to average establishment industries grouped together to represent average firm size is similar to or the typical industry. It can be comprised receipts to arrive at nonpayroll costs per significantly lower than that of the establishment (an establishment is a of all industries, all manufacturing comparison industry group, it would be industries, all industries with receipt- business entity operating at a single a basis to adopt the anchor size standard based size standards, or some other location). An industry with a or, in rare cases, a lower size standard. logical grouping. If the characteristics of significantly higher level of nonpayroll a specific industry are similar to the 2. The distribution of firms by size costs per establishment than that of the average characteristics of the examines the proportion of industry comparison group is likely to have comparison group, then the anchor size receipts, employment or other economic higher start-up costs that would tend to standard is considered appropriate for activity accounted for by firms of support a size standard higher than the the industry. If the specific industry’s different sizes in an industry. If the anchor size standard. Conversely, if the characteristics are significantly different preponderance of an industry’s industry showed a significantly lower from the characteristics of the economic activity is by smaller firms, nonpayroll costs per establishment comparison group, a size standard this tends to support adopting the when compared to the comparison higher or, in rare cases, lower than the anchor size standard. The opposite is group, the anchor size standard would anchor size standard may be considered the case for an industry in which the be considered the appropriate size appropriate. The larger the differences distribution of firms indicates that standard. between the specific industry’s economic activity is concentrated 4. Industry competition is assessed by characteristics and the comparison among the largest firms in an industry. measuring the proportion or share of group, the larger the difference between In this rule, SBA is comparing the size industry receipts obtained by firms that the appropriate industry size standard of firm within an industry to the size of are among the largest firms in an and the anchor size standard. Only firm in the comparison group at which industry. In this proposed rule, SBA when all or most of the industry predetermined percentages of receipts characteristics are significantly smaller are generated by firms smaller than a compared the proportion of industry than the average characteristics of the particular size firm. For example, for receipts generated by the four largest comparison group, or other industry Testing Laboratories, 50% of total firms in the industry—generally referred considerations strongly suggest the industry receipts are generated by firms to as the ‘‘four-firm concentration anchor size standard would be an of $9.3 million in receipts and less. This ratio’’—with the average four-firm unreasonably high size standard for the contrasts with the comparison group concentration ratio for industries in the industry under review, will SBA adopt (composed of industries with the comparison groups. If a significant a size standard below the anchor size nonmanufacturing anchor size standard proportion of economic activity within standard. of $6 million) in which firms of $5.8 the industry is concentrated among a In 13 CFR 121.102 (a) and (b), million or less in receipts generated few relatively large producers, SBA evaluation factors are listed which are 50% of total industry receipts. Viewed tends to set a size standard relatively the primary factors describing the in isolation, this significantly higher higher than the anchor size standard to structural characteristics of an figure for Testing Laboratories suggests assist firms in a broader size range industry—average firm size, distribution that a higher size standard than the compete with firms that are larger and of firms by size, start-up costs, and nonmanufacturing anchor size standard more dominant in the industry. In industry competition. The analysis also may be warranted. Other size general, however, SBA does not examines the possible impact of a size distribution comparisons in the industry consider this to be an important factor standard revision on SBA’s programs as analysis include 40%, 60%, and 70%, in assessing a size standard if the four- an evaluation factor. SBA generally as well as the 50% comparison firm concentration ratio falls below 40% considers these five factors to be the discussed above. for an industry under review, while its
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comparison groups also average less is provided mainly to small businesses industry structure. SBA examined than 40%. much lower than the size standard, an economic data on these industries from 5. Competition for Federal increase to the size standard (especially, a special tabulation of the 1997 procurements and SBA Financial if it is already above the anchor size Economic Census prepared under Assistance. SBA also evaluates the standard) may not be appropriate. contract by the U.S. Bureau of the possible impact of a size standard on its Evaluation of Industry Size Standard: Census. SBA also examined Federal programs to determine whether small The two tables below show the contract award data for fiscal years businesses defined under the existing characteristics for the Testing 1998–2000 from the U.S. General size standard are receiving a reasonable Laboratories industry and for the Services Administration’s Federal level of assistance. This assessment Procurement Data Center. most often focuses on the proportion or comparison group. The primary share of Federal contract dollars comparison group is comprised of all Industry Structure Consideration: awarded to small businesses in the industries with a $6 million receipts- Table 1 below examines the size industry in question. In general, the based size standard (referred to as the distribution of Testing Laboratories. For lower the share of Federal contract nonmanufacturing anchor group). Since this factor, SBA is evaluating the size of dollars awarded to small businesses in SBA’s size standards analysis is firm that accounts for predetermined an industry which receives significant assessing whether the Testing percentages of total industry receipts Federal procurement revenues, the Laboratories size standard should be (40%, 50%, 60%, and 70%). The table greater is the justification for a size higher than the nonmanufacturing shows firms up to a specific size that, standard higher than the existing one. anchor size standard, this is the most along with smaller firms, account for a As another factor to evaluate the logical set of industries to group specific percentage of total industry impact of a proposed size standard on together for the industry analysis. Data receipts. For example, Testing SBA programs, the volume of on a second comparison group is also Laboratories of $4.6 million or less in guaranteed loans within an industry and shown. This group consists of all receipts obtained 40% of total industry the size of firms obtaining those loans industries in NAICS Sector 54, receipts. Within the nonmanufacturing is assessed to determine whether the Professional, Scientific, and Technical anchor group, firms of $3.2 million or current size standard may restrict the Services—the NAICS Sector of which less in receipts obtained 40% of total level of financial assistance to firms in Testing Laboratories is a part. The data industry receipts in the average that industry. If small businesses receive on this comparison group provide an industry, while in NAICS sector 54, ample assistance through these additional perspective on the size of firms of $2.3 million or less in receipts programs, or if the financial assistance firms in related industries and their obtained 40% of total industry receipts.
TABLE 1.—SIZE DISTRIBUTIONS OF FIRMS IN THE TESTING LABORATORIES INDUSTRY, NONMANUFACTURING ANCHOR GROUP, AND NAICS SECTOR 54 [Data in Thousands of Dollars]
Size of firm at Size of firm at Size of firm at Size of firm at Category 40% 50% 60% 70%
Testing Laboratories ...... $4,600 9,262 18,726 33,867 Nonmanufacturing Anchor Group ...... 3,206 5,821 11,857 27,957 NAICS Sector 54 ...... 2,262 4,683 9,668 31,904
These data suggest that a size standard nearly double the $6 million size standard may be appropriate for the industry of Testing Laboratories. At the given coverage levels the size of firm for the Testing Laboratories industry is significantly larger than in the two comparison groups. The size of firms for the Testing Laboratories industry is more than 40% larger than in the Nonmanufacturing Anchor comparison group, and about twice as large as the average industry in NAICS Sector 54 for most of the distribution percentages. Table 2 lists the other four evaluation factors for the Testing Laboratories industry and the comparison groups. These include comparisons of average firm size, the measurement of start-up costs as measured by nonpayroll receipts per establishment, and the four-firm concentration ratio.
TABLE 2.—INDUSTRY CHARACTERISTICS OF THE TESTING LABORATORIES INDUSTRY, NONMANUFACTURING ANCHOR GROUP, AND NAICS SECTOR 54
Average firm size Non payroll receipts per Four firm con- Category Receipts establishment centration ratio (millions $) Employees (million $) (in percent)
Testing Laboratories ...... 1.56 19.9 0.68 12.1 Nonmanufacturing Anchor Group ...... 0.95 10.6 0.56 14.4 NAICS Sector ...... 54 0.77 7.7 0.45
For Testing Laboratories, its average NAICS Sector 54 industries. Moreover, groups to support a size standard firm size in receipts is one and one-half its average firm size in employees is two appreciably above or double the $6 times larger than the average firm size to three times the average sizes of these million size standard. Its nonpayroll in the Nonmanufacturing Anchor two comparison groups. This factor is receipts per establishment ratio comparison group, and twice that of the sufficiently higher than the comparison indicator, a measure of capital
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requirements to enter an industry, is to assess whether its size standard are summed and combined. In fiscal also somewhat higher than the anchor should be revised. SBA provides a years 1998–2000, 18.7% of the total comparison group, and about one and relatively small amount of financial value of all Federal prime contracts one-half times the size of the NAICS assistance to Testing Laboratories. In were awarded to small firms, a figure Sector 54 group of industries. This fiscal year 2000, 66 loans totaling $21 more than twice the share of small firms factor indicates that a size standard million were guaranteed to Testing in the Testing Laboratories Industry. In slightly above the $6 million size Laboratories. Most of these loans were addition, this share is disproportionally standard may be appropriate. Its four- to labs with less than $1 million in small when compared with the amount firm concentration ratio, however, is receipts. It’s unlikely that an increase to of total industry receipts generated by relatively low, indicating that the the size standard will have much impact small Testing Laboratories. Although industry is not dominated by large on the financial programs and, the Census Bureau data indicate that businesses. This is the only industry consequently, this factor is not part of structure parameter not pointing to the the assessment of the size standard. small Testing Laboratories account for need for a higher size standard for In the case of Federal procurement, more than 40% of industry receipts, Testing Laboratories. the share of Federal contracts awarded they obtained only 8.4% of Federal SBA Program Considerations: SBA to small Testing Laboratories supports contracts during fiscal years 1998–2000. also reviews its size standards in an increase to the current size standard These figures suggest that the Federal relationship to its programs. Since SBA (see Table 3). Small Testing Laboratories contract requirements are different from is reviewing the Testing Laboratories received only 8.4% of the dollar value those of the private marketplace, Industry’s size standard because of of Federal contracts awarded during favoring, in general, larger firms with concerns about the application of the fiscal years 1998 to 2000. While there greater experience and sophistication. size standard to Federal procurement, are no NAICS procurement data These results strongly reinforce the this proposed rule gives more available for the receipt-based size industry structure factors in arguing for consideration to the pattern of Federal standards group, or for the 54 group, a higher size standard for Testing contract awards than to the level of SBA does have data for total small Laboratories. financial assistance to small businesses business awards in which all industries
TABLE 3.—SMALL BUSINESS PRIME CONTRACT AWARDS, FISCAL YEARS 1998–2000 [Data in thousands of dollars]
Sum of Category FY 1998 FY 1999 FY 2000 three years
Total Awards ...... $182,255.7 $183,579.4 $203,533.9 $569,369.0 Small Business Awards ...... $33,746.7 $34,482.9 $38,260.3 $106,490.0 Percent to Small Business ...... 18.5% 18.8% 18.8% 18.7% Testing Laboratories Awards ...... $861.6 $628.0 $84.7 $1,574.3 Small Testing Laboratories Awards ...... $44.1 $45.3 $42.1 $131.7 Percent to Small Testing Laboratories ...... 5.1% 7.2% 49.7% 8.4% Note: Data for FY 2000 for Testing Laboratories are not representative of most years due to deobligations of $135 million from procurements initiated in previous years.
Overview: Based on the analysis of compete successfully for Federal of operation. The largest firm at the each evaluation factor, SBA is proposing contracts. proposed size standard level generates a $10 million size standard. Four of the Dominant in Field of Operation: less than 0.16% of total industry five evaluation factors clearly support a Section 3(a) of the Small Business Act receipts. This level of market share size standard ranging from slightly defines a small concern as one that is (1) effectively precludes any ability for a above to double the $6 million independently owned and operated, (2) firm at or below the proposed size nonmanufacturing anchor size standard. not dominant in its field of operation standard to exert a controlling effect on The low amount of participation of and (3) within detailed definitions or this industry. Alternative Size small businesses in Federal government size standards established by the SBA Standards: SBA considered as an procurement, however, is of special Administrator. SBA considers as part of alternative size standard to the proposed concern and suggests, as the requestors its evaluation of a size standard whether $10 million, a more modest increase to had pointed out, that Federal contract a business concern at or below a $7.5 million, and a larger increase to requirements may indeed influence the proposed size standard would be $12.5 million. SBA, however, decided size of Testing Laboratories that considered dominant in its field of not to propose the more moderate possesses the equipment and operation. This assessment generally increase of $7.5 million because it qualifications to perform on Federal considers the market share of firms at believes that the very low share of analytical testing contracts. After the proposed or final size standard, or Federal procurements to small Testing considering all factors, SBA believes other factors that may show whether a Laboratories indicates the need for a that a $10 million size standard is a firm can exercise a major controlling higher size standard to include those reasonable size standard for the Testing influence on a national basis in which Testing Laboratories that can meet and Laboratories industry and will help significant numbers of business perform on many Federal analytical small businesses in this industry to concerns are engaged. testing contracts. SBA also decided not compete for Federal contracts without SBA has determined that no firm at or to propose a larger increase to $12.5 including businesses that are so large below the proposed size standard for the million based on the fact that two of the that they could harm the ability of much Testing Laboratories industry would be five factors reviewed indicated a size smaller-sized small businesses to of a sufficient size to dominate its field standard at, or only slightly above, the
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$6 million nonmanufacturing anchor It also requires that small business programs, small businesses may benefit size standard. SBA believes that the definitions vary to reflect industry by becoming more knowledgeable, evaluation factors should be virtually differences. SBA believes that an stable, and competitive businesses. unanimous for an increase of this adjustment in the size standard of the The benefits of a size standard magnitude. While the industry factors Testing Laboratories industry is needed increase to a more appropriate level pointed to a higher size standard for this to better reflect the industrial structure would accrue to three groups. First, industry, they were not strong enough to of this industry. businesses that benefit by gaining small support a size standard of $12.5 business status from the proposed size 2. Alternatives million—more than twice the present standards and use small business size standard. However, the factors did There are no viable alternatives to assistance programs. Second, growing point to a size standard of $10 million. establishing size standards to define a small businesses that may exceed the The three factors pointing to a $10 small business for Federal small current size standards in the near future million size standard—the size business programs. The purpose of this and who will retain small business distribution of firms, average firm size, rule is to better define the size of firms status from the proposed size standards. and the Federal procurement share of eligible for SBA assistance. Third, Federal agencies that award small firms—are the factors that SBA 3 What is the baseline? contracts under procurement programs believes are most important when that require small business status. analyzing a size standard. (The non- The baseline in this rule is the Newly defined small businesses payroll receipts per establishment is coverage of businesses whose size is at would benefit from the SBA’s financial only a proxy measure of capitalization, or below SBA’s size standard of $6 programs, in particular its 7(a) and the four firm concentration million for this industry. A special Guaranteed Loan Program and Certified measure, generally, is so low outside of tabulation of the 1997 Economic Census Development Company (504) Program. the manufacturing and utility industries prepared for SBA reports that 3,762 SBA estimates that approximately $2.1 that it usually has little effect on the firms active in this industry are defined million in new Federal loan guarantees analysis.) Thus, with three out of five as small out of 4,126 firms in the could be made to these newly defined factors pointing to a higher size industry. These account for 91.2% of small businesses. This represents 9.8% standard, and the fact that these factors total firms in the industry. These firms of the $21 million in loans that were are more important than the other generate $2.66 billion of the $6.44 guaranteed by the SBA under these two factors, SBA believes that a size billion produced in the industry. SBA financial programs to firms in the standard of $10 million is warranted. estimates that 98.4% of all businesses in Testing Laboratories industry in FY SBA welcomes public comments on the U.S. are currently defined as small 2000. Because of the size of the loan its proposed size standard for the under the existing size standards and guarantees, most loans are made to Testing Laboratories industry. they account for 28.6% of industry small businesses well below the size Comments supporting an alternative to sales. standard. Thus, increasing the size the proposal, including the option of B. Benefit Estimates standard will likely result in only a retaining the size standard at $6 million small increase in small business discussed above, should explain why The most significant benefit to guaranteed loans to businesses in this the alternative would be preferable to businesses obtaining small business industry, and the $2.1 million estimated the proposed size standard. status as a result of this rule is eligibility figure may overstate the actual impact. for Federal small business assistance The newly defined small businesses Compliance With Executive Orders programs. Under this rule, 120 would also benefit from SBA’s 12866, 12988, and 13132, the additional firms will obtain small economic injury disaster loan program. Paperwork Reduction Act (44 U.S.C. business status and become eligible for Since this program is contingent upon Ch. 35) and the Regulatory Flexibility these programs. These include SBA’s the occurrence and severity of a Act (5 U.S.C. 601–612) financial assistance programs and disaster, no meaningful estimate of The Office of Management and Budget Federal procurement preference benefits can be projected. (OMB) has determined that this programs for small businesses, 8(a) SBA estimates that approximately $51 proposed rule constitutes a ‘‘significant’’ firms, small disadvantaged businesses, million per year of additional Federal regulatory action under Executive Order small businesses located in Historically prime contracts may be awarded to 12866. SBA’s regulatory analysis is set Underutilized Business Zones businesses becoming newly designated forth below. (HUBZone), women-owned small small businesses in the Testing businesses, and veteran-owned and Laboratories industry. This represents Regulatory Impact Analysis service disabled veteran-owned small 9.8% of the $525 million that the A. General Considerations businesses, as well as those awarded Federal government awarded in the through full and open competition after average year in this industry during 1. Is There a Need for the Regulatory application of the HUBZone or small fiscal years 1998–2000. Action? disadvantaged business price evaluation Federal agencies may benefit from the SBA is chartered to aid and assist preference or adjustment. Other Federal higher size standards if the newly small businesses through a variety of agencies use SBA size standards for a defined and expanding small businesses financial, procurement, business variety of regulatory and program compete for more set-aside development, and advocacy programs. purposes. SBA does not have procurements. The larger base of small To effectively assist intended information on each of these uses to businesses would likely increase beneficiaries of these programs, SBA evaluate the impact of size standards competition and lower the prices on set- must establish distinct definitions of changes. However, in cases where SBA aside procurements. A large base of which businesses are deemed small size standards are not appropriate, an small businesses may create an businesses. The Small Business Act (15 agency may establish its own size incentive for Federal agencies to set U.S.C. 632(a)) delegates to the SBA standards with the approval of the SBA aside more procurements, thus creating Administrator the responsibility for Administrator (see 13 CFR 121.801). greater opportunities for all small establishing small business definitions. Through the assistance of these businesses. Nonsmall businesses with
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small business subcontracting goals may businesses may have fewer Federal as a result of this rule, if adopted. The also benefit from a larger pool of small contract opportunities as Federal number of small businesses would businesses by enabling them to better agencies decide to set aside more increase from 3,762 firms to 3,882. achieve their subcontracting goals at Federal procurements for small These businesses would be eligible to lower prices. No estimate of cost savings businesses. Also, some Federal contracts seek available SBA assistance provided from these contracting decisions can be may be awarded to HUBZone or small that they meet other program made since data are not available to disadvantaged businesses instead of requirements. Businesses becoming directly measure price or competitive large businesses since those two newly eligible for SBA assistance as a trends on Federal contracts. categories of small businesses are result of this rule, if finalized, eligible for price evaluation preferences C. Costs Estimates cumulatively generate $635 million in for contracts competed on a full and this industry. The amount of receipts by To the extent that up to 120 open basis. Similarly, currently defined small firms would increase from $2.7 additional firms could become active in small businesses may obtain fewer billion to $3.3 billion out of a total of Government programs, this may entail Federal contacts due to the increased $6.4 billion in receipts. The small some additional administrative costs to competition from more businesses business coverage in this industry the Federal government associated with defined as small. This transfer may be would increase by 9.8% of total additional bidders for Federal small offset by a greater number of Federal receipts. This figure of 9.8% is used to business procurement programs, procurements set aside for all small estimate the potential economic impacts additional firms seeking SBA businesses. The potential transfer of of this rule as they relate to Federal guaranteed lending programs, and contracts away from large and currently programs that are discussed below. additional firms eligible for enrollment defined small businesses would be Description of Potential Benefits of in SBA’s PRO-Net data base program. limited by the number of newly defined the Rule: The most significant benefit to Among businesses in this group seeking and expanding small businesses that businesses obtaining small business SBA assistance, there will be some were willing and able to sell to the status as a result of this rule is their additional costs associated with Federal Government. The potential eligibility for Federal small business compliance and verification of small distributional impacts of these transfers assistance programs. These include business status and protests of small cannot be estimated with any degree of SBA’s financial assistance programs and business status. These costs are likely to precision since the data on the size of Federal procurement preference generate minimal incremental business receiving a Federal contract are programs for small businesses, 8(a) administrative costs since limited to identifying small or other- firms, small disadvantaged businesses, administrative mechanisms are than-small businesses. and small businesses located in currently in place to handle these SBA has determined that this Historically Underutilized Business administrative requirements. proposed rule, if adopted, may have a Zones (HUBZone). The costs to the Federal government significant economic impact on a SBA estimates that firms gaining may be higher on some Federal substantial number of small entities small business status could potentially contracts as a result of this rule. With within the meaning of the Regulatory obtain additional Federal contracts greater numbers of businesses defined Flexibility Act (RFA), 5 U.S.C. 601 et worth $51 million per year under the as small, Federal agencies may choose seq. Immediately below is an initial small business set-aside program, the to set aside more contracts for regulatory flexibility analysis (IRFA) of 8(a) and HUBZone programs or competition among small businesses this proposed rule addressing the unrestricted contracts. This represents rather than using full and open following questions: (1) What is the 9.8% of the $525 million that the competition. The movement from need for and objective of the rule, (2) Federal government awarded per year in unrestricted to set aside is likely to what is SBA’s description and estimate this industry during fiscal years 1998– result in competition among fewer of the number of small entities to which 2000. The added competition for many bidders for a contract. Also, higher costs the rule will apply, (3) what is the of these procurements also would likely may result if additional full and open projected reporting, record keeping, and result in a lower price to the contracts are awarded to HUBZone and other compliance requirements of the government for procurements set aside SDB businesses as a result of a price rule, and (4) what are the relevant for small businesses, but SBA is not able evaluation preference. The additional Federal rules which may duplicate, to quantify this benefit. costs associated with fewer bidders, overlap or conflict with the proposed however, are likely to be minor since, as rule. Under SBA’s 7(a) Guaranteed Loan a matter of policy, procurements may be Program and Certified Development set aside for small businesses or under (1) What Is the Need for and Objective Company (504) Program, SBA estimates the 8(a), and HUBZone Programs only if of the Rule? that an additional $2.1 million in new awards are expected to be made at fair SBA believes that this revision to the Federal loan guarantees could be made and reasonable prices. size standard for Testing Laboratories to these newly defined small businesses. more appropriately defines the size of This represents 9.8% of the $21 million D. Other Considerations Including businesses in this industry that should in loans that were guaranteed y SBA Distributional Effects, Equity be eligible for Federal small business under these two financial programs for Considerations and Uncertainty assistance programs. A review of the firms in the Testing Laboratories The proposed size standard may have latest available data supports a change Industry in FY 2000. Because of the size distributional effects among large and to the current size standard. of the loan guarantees, most loans are small businesses. Although the actual made to businesses well below the size outcome of the gains and loses among (2) What Is SBA’s Description and standard. Thus, increasing the size small and large businesses cannot be Estimate of the Number of Small standard will likely result in only a estimated with certainty, several trends Entities to Which the Rule Will Apply? small increase in small business are likely to emerge. First, a transfer of SBA estimates that 120 additional guaranteed loans to businesses in this some Federal contracts to small businesses out of 4,126 businesses in industry, and the $2.1 million estimated businesses from large businesses. Large the industry would be considered small figure may overstate the actual impact.
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We view the additional amount of are active in Government programs, this Federal program that uses its size contract activity as the potential amount will entail some additional standards. In cases where an SBA’s size of transfer from non-small to newly administrative costs to the Federal standard is not appropriate, the Small designated small firms. This does not government associated with additional Business Act and SBA’s regulations represent the creation of new bidders for SBA’s procurement allow Federal agencies to develop contracting activity by the Federal programs, additional firms seeking SBA different size standards with the government, merely a reallocation or guaranteed lending programs, and approval of the SBA Administrator (13 transfer to different sized firms. additional firms eligible for enrollment CFR 121.902). For purposes of a Description of Potential Costs of the in SBA’s Pro Net program. Among firms regulatory flexibility analysis, agencies Rule: The changes in size standards as in this group seeking SBA assistance, must consult with SBA’s Office of they affect Federal procurement are not there will be some additional costs Advocacy when developing different expected to add any significant costs to associated with compliance and size standards for their programs. the government. As a matter of policy, verification. These costs are likely to be For the purpose of the Paperwork procurements may be set aside for small small. Reduction Act, 44 U.S.C. Ch. 35, SBA business or under the 8(a) and certifies that this rule would not impose (3) What Is the Projected Reporting, HUBZone Programs only if awards are new reporting or record keeping Record Keeping, and Other Compliance expected to be made at reasonable requirements, other than those required Requirements of the Rule and an prices. Similarly, the rule should not of SBA. For purposes of Executive Order Estimate of the Classes of Small Entities result in any added costs associated 13132, SBA certifies that this rule does Which Will Be Subject to the with the 7(a) and 504 loan programs. not have any federalism implications Requirements? The amount of lending authority SBA warranting the preparation of a can make or guarantee is established by A new size standard does not impose Federalism Assessment. For purposes of appropriation. any additional reporting, record keeping Executive Order 12988, SBA certifies The competitive effects of size or compliance requirements on small that this rule is drafted, to the extent standard revisions differ from those entities. Increasing size standards practicable, in accordance with the normally associated with other expands access to SBA programs that standards set forth in that order. regulations which typically burden assist small businesses, but does not smaller firms to a greater degree than impose a regulatory burden as they List of Subjects in 13 CFR Part 121 larger firms in areas such as prices, neither regulate nor control business Administrative practice and costs, profits, growth, innovation and behavior. procedure, Government procurement, mergers. A change to a size standard is (4) What Are the Relevant Federal Rules Government property, Grant programs— not anticipated to have any appreciable business, Loan programs—business, effect on any of these factors, although Which May Duplicate, Overlap or Conflict With the Proposed Rule? Small businesses. small businesses, 8(a) firms, or small Accordingly, part 121 of 13 CFR is disadvantaged businesses much smaller This proposed rule overlaps other proposed to be amended as follows: than the size standard for their industry Federal rules that use SBA’s size may be less successful in competing for standards to define a small business. PART 121—[AMENDED] some Federal procurement Under section 632(a)(2)(C) of the Small opportunities due to the presence of Business Act, unless specifically 1. The authority citation for part 121 larger, newly defined small businesses. authorized by statute, Federal agencies continues to read as follows: On the other hand, with more larger must use SBA’s size standards to define Authority: 15 U.S.C. 632(a), 634(b)(6), small businesses competing for small a small business. In 1995, SBA 637(a), 644(c) and 662(5) and Sec. 304, Pub. business set-aside and 8(a) published in the Federal Register a list L. 103–403, 108 Stat. 4175, 4188. procurements, Federal agencies are of statutory and regulatory size 2. In § 121.201, in the table ‘‘Small likely to increase the overall number of standards that identified the application Business Size Standards by NAICS contracting opportunities available of SBA’s size standards as well as other Industry’’, under the heading Subsector under these programs, and this could size standards used by Federal agencies 541—Professional, Scientific and result in greater opportunities for (60 FR 57988–57991, dated November Technical Services, revise the entry for businesses much smaller than the size 24, 1995). SBA is not aware of any 541380 to read as follows: standard. Federal rule that would duplicate or Under this rule, there will be 120 conflict with establishing size § 121.201 What size standards has SBA additional firms that are considered standards. identified by North American Industry small and eligible for SBA preference SBA cannot estimate the impact of a Classification System codes? programs. To the extent that these firms size standard change on each and every * * * * *
SMALL BUSINESS SIZE STANDARDS BY NAICS INDUSTRY
Size standards in number of em- NAICS codes Description (N.E.C.=Not Elsewhere Classified) ployees or millions of dollars
******* Sector 54—Professional, Scientific and Technical Services Subsector 541—Professional, Scientific and Technical Services
******* 541380 ...... Testing Laboratories ...... $10.0
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SMALL BUSINESS SIZE STANDARDS BY NAICS INDUSTRY—Continued
Size standards in number of em- NAICS codes Description (N.E.C.=Not Elsewhere Classified) ployees or millions of dollars
*******
* * * * * Hollow Road, Clarksburg, West Virginia, value of the vehicle prior to the incident Dated: January 8, 2002. 26306. causing the damage. A salvage vehicle Hector V. Barreto, FOR FURTHER INFORMATION CONTACT: may be rebuilt, retitled, and allowed to operate legally on the road. A junk Administrator. Supervisory Special Agent Stephen A. Bucar, telephone number (304) 625– motor vehicle is a vehicle that is non- [FR Doc. 02–8359 Filed 4–8–02; 8:45 am] 2751. repairable, incapable of operation on BILLING CODE 8025–01–P SUPPLEMENTARY INFORMATION: Section roads or highways, and has no value 609 of the Anti Car Theft Act of 1992, except as a source of parts or scrap. The definitions for salvage and junk motor DEPARTMENT OF JUSTICE Public Law Number 102–519 (codified at 49 U.S.C. 33109), directed the vehicles include any individual state and federally recognized tribe’s 28 CFR Part 89 Attorney General to establish a National Stolen Auto Part Information System definition for a vehicle that is declared [AG ORDER No. 2570–2002] (NSAPIS) to track and monitor stolen a total loss or economically impractical to repair. The only parts affected by the RIN 1110–AA01 parts. Further legislation renamed the system as the National Stolen Passenger Act (‘‘covered major parts’’) are original National Stolen Passenger Motor Motor Vehicle Information System. See major parts that are dismantled, Vehicle Information System Public Law 103–272 (1994). recycled, salvaged, or otherwise Regulations removed from motor vehicles and that What is the nature of the problem that possess a parts marking label with the AGENCY: Department of Justice. needs to be addressed? 17-character VIN or a derivative of the ACTION: Proposed rule. The total cost of motor vehicle theft VIN. in the United States in 1994 was $7.6 The Act does not apply to the sale of SUMMARY: The United States Department billion, according to the National new motor vehicles. Furthermore, the of Justice (Department) is publishing a Act does not apply to the sale of proposed rule to implement the Insurance Crime Bureau (NICB). This total compares to $3.2 billion in 1970 manufacturer replacement parts or new National Stolen Passenger Motor after-market parts. These parts have Vehicle Information System (NSPMVIS (1994 dollars), an increase of 134 percent. A 1995 NICB study shows that unique labels that identify them as new or System) that will verify the theft replacement parts and are not required status of salvage and junk motor criminals in the 1990s were utilizing more sophisticated methods in selling by the National Highway Traffic Safety vehicles and major parts marked with a Administration (NHTSA) to possess Vehicle Identification Number (VIN) or and disguising stolen vehicles and vehicle parts compared to thieves in parts-marking labels with the 17- a derivative of a VIN. Under specific character VIN or a derivative of the VIN. conditions detailed in this proposed previous years. The NICB study revealed that not only were stolen For example, parts manufactured by rule an insurance carrier selling parts manufacturers, that are distributed comprehensive motor vehicle insurance vehicles less likely to be recovered in 1995 as compared to 1970, but the to replace or repair original parts, are coverage or a person engaged in the not required to be inspected and business of salvaging, dismantling, condition of recovered vehicles also deteriorated. checked against the NSPMVIS. recycling, or repairing passenger motor The Act allows for civil penalties of vehicles must verify the theft status of What was the congressional response to not more than $1,000 for each violation salvage and junk motor vehicles or the theft problem? of the regulations implementing the Act major parts. In addition, this proposed In response to the continuing problem to a maximum of $250,000 for a related rule contains prescribed procedures of motor vehicle theft in the United series of violations. The Act also allows under which an individual or entity, not States, Congress passed the Anti Car for enforcement of a civil penalty of not engaged in the business of salvaging, Theft Act of 1992 (the ‘‘Act’’). Among more than $100,000 a day for each dismantling, recycling, or repairing other anti-theft measures, the Act violation related to chop shop activity. passenger motor vehicles, intending to mandates the establishment of a This applies to any person who transfer a passenger motor vehicle or national computer system to verify the knowingly owns, operates, maintains, or passenger motor vehicle part, may theft status of salvage and junk motor controls a chop shop, conducts obtain information on whether the vehicles and covered major parts. operations in a chop shop, or transports vehicle or part is listed in the System as The Act affects salvage and junk a passenger motor vehicle or passenger stolen. motor vehicles and covered major parts. motor vehicle part to or from a chop DATES: Comments must be submitted on A salvage motor vehicle is a vehicle that shop. or before June 10, 2002. has been damaged by collision, fire, Regarding the NSPMVIS, the Act ADDRESSES: All comments concerning flood, accident, trespass, or other requires that the Attorney General of the this proposed rule should be mailed to: incident to the extent that its fair United States, in consultation with the Stephen A. Bucar, Supervisory Special salvage value plus the cost of repairing Secretary of Transportation: Agent, Federal Bureau of Investigation, the vehicle for legal operation on roads (1) Establish and maintain an CJIS Division, Module C–3, 1000 Custer or highways exceeds the fair market information system containing the
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VIN of stolen passenger motor appropriate use by the NICB of the FBI’s NHTSA, local law enforcement, and a vehicles and the VIN or its derivative National Crime Information Center consumer advocacy group. of stolen passenger motor vehicle (NCIC) stolen vehicle and stolen vehicle The Committee convened on four parts; part data (the NCIC Vehicle File) by the separate occasions in the Washington, (2) Prescribe by regulation procedures NICB. DC, area: November 18–19, 1993; April by which an individual or entity, not This proposed rule is being published 19–20, 1994; June 14–15, 1994; and engaged in the business of salvaging, to further the implementation of the August 16–17, 1994. It developed a set dismantling, recycling, or repairing NSPMVIS. It has a direct impact on the of recommendations on the passenger motor vehicles, intending following groups: motor vehicle owners development of the stolen motor to transfer a passenger motor vehicle and consumers; motor vehicle parts vehicles and parts information system. or passenger motor vehicle part may dealers (including motor vehicle The recommendations addressed obtain information as to whether the dismantlers, recyclers, repairers, and System administration and design; the vehicle or part is listed in the System salvagers); the insurance industry; appointment of a System Administrator; as stolen; motor vehicle auctioneers and salvager law enforcement notification procedures (3) Prescribe by regulation procedures pools (these groups often act as an agent should the System determine a part is by which an insurance carrier selling of insurers to sell or transfer salvage or stolen; and the documentation of comprehensive motor vehicle junk motor vehicles); motor vehicle inquiries in cases where no theft is insurance coverage that obtains manufacturers; and the law enforcement indicated in the System. The Committee possession of and intends to transfer community. Each of these groups has also recommended enactment of a junk motor vehicle or a salvage interests in and concerns regarding a legislation providing a limited motor vehicle, can verify whether the national stolen motor vehicle parts immunity clause for system vehicle is listed in the System as system and we encourage all of these participants. In addition, the Committee stolen; and organizations to submit any comments, issued recommendations as to the level (4) Prescribe by regulation procedures concerns, or ideas regarding the overall of security necessary to ensure the by which a person engaged in the motor vehicle theft problem or any safety and reliability of the System and business of salvaging, dismantling, aspect of this proposed rule. methods for ensuring the completeness, recycling, or repairing passenger timeliness, and accuracy of the data motor vehicles can verify that a major What will be the role of the NSPMVIS? entered and stored in the System. The passenger motor vehicle part has not The NSPMVIS will operate as a large Committee also proposed legislation for been listed in the System as stolen. data exchange system for the purposes a uniform definition of salvage and junk of establishing and verifying the theft motor vehicles. Furthermore, the The Act also directs that the parts status of salvage or junk motor vehicles Committee recommended how the theft marking program be expanded to cover and covered major parts by permitting status determination should occur and all vehicles, with the exception of a the comparison of VINS with stolen and the methods for handling cases where limited number of lines for which stolen parts data previously entered into the System cannot make a waivers are granted, unless the Attorney the System. Participants will include determination in a timely manner. General determines that parts marking motor vehicle insurers, dismantlers, Finally, the Committee recommended does not substantially inhibit chop shop recyclers, repairers, and salvagers. This who should be responsible for (1) operations and vehicle theft. proposed rule does not impose an verifying whether covered major parts obligation to use the System nor does it What has the Department of Justice have been stolen, and (2) processing the assess penalties for failure to use the done to address the problem? checks and verifications of VINs System against individuals and entities through the System. The Federal Bureau of Investigation not engaged in the business of salvaging, The Committee’s recommendations (FBI), as directed by the Attorney dismantling, recycling, or repairing were designed to provide the key General, has coordinated the policy and passenger motor vehicles (such as the development and implementation legislative efforts on the NSPMVIS since ordinary consumer who purchases, criteria to which Committee members November 1993. Pursuant to 49 U.S.C. sells, or transfers motor vehicles and believe the System needs to adhere in 33109(c), the Attorney General parts for his or her own personal use) order to maximize its effectiveness. The established the NSPMVIS Federal who intend to transfer a passenger Committee members drafted these Advisory Committee (Committee) and motor vehicle or part without verifying recommendations after thoroughly charged it with providing its theft status. However, if these considering all of the potential issues recommendations and a final report to individuals or entities wish to inquire of and effects of the System. The Congress and the Attorney General. The the System, this proposed rule does recommendations of the Committee, FBI conducted a pilot project and on prescribe procedures under which they with some modifications and revisions January 31, 1996, published the ‘‘Final may do so. based on the NSPMVIS pilot project and Report on the National Stolen Passenger subsequent legal opinions, represent the Motor Vehicle Information System What is the Federal Advisory core requirements of this proposed rule. (NSPMVIS) Pilot Project and National Committee and what were its Through the FBI’s Criminal Justice Implementation Study’’ for the Attorney Recommendations? Information Services (CJIS) Advisory General and Congress. It also drafted In order to solicit recommendations Policy Board process, the FBI initially immunity language providing limited for establishing the NSPMVIS from recommended, in June 1993, that the civil immunity to system participants those industries and organizations that NICB serve as the System Administrator that was included in the Anti Car Theft are directly impacted by the System, the of the NSPMVIS. The NSPMVIS Federal Improvements Act of 1996. See Pub. L. Act established the NSPMVIS Federal Advisory Committee included this No. 104–152 (1996). A formal Advisory Committee for which the FBI recommendation in its Final Report Memorandum of Understanding (MOU) provided oversight. The Committee published in November 1994. The was developed between the FBI and the membership included representatives of Attorney General approved this NICB in April 1997 establishing the insurance, dismantling, recycling, recommendation in a memorandum to procedures for and limits on the repairing, and salvaging industries, the the FBI, dated January 18, 1995. In the
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event that the NICB is not able to serve inventory, which is likely because it is of the goals of the System is to make the as the System Administrator, a rare for legitimate parts dealers to electronic transfer of data from insurers successor will be recommended through purchase a stolen vehicle, then there and parts dealers to the NICB as simple the CJIS Advisory Process for the will not be any identifiable stolen parts as possible for the participants. Attorney General to consider for in that inventory. However, there are also thousands of approval. It is clear, however, that there are non-automated parts dealers around the The NICB was created through a 1992 covered major parts in motor vehicles country who must be included in the merger of the National Automobile that possess VINs different from the process. Industry experts suggest that as Theft Bureau (NATB) and the Insurance master VIN of the vehicle. This many as 80 percent of parts dealers Crime Prevention Institute (ICPI). The proposed rule takes into account the throughout the country purchase fewer NATB was involved primarily with the necessity of a parts verification process than 50 vehicles per month and would prevention of vehicle theft and the ICPI that ensures that any covered major part be considered small. It is the intention primarily handled suspicious or with a VIN different from the master of the NSPMVIS and integral to the questionable property/casualty claims. VIN is checked against the System based success of the System that the In order for the NICB to serve as the on its unique VIN and not the master inventories of smaller dealers be NSPMVIS System Administrator, it was VIN. included in the part verification necessary to create an on-line interface The low theft ratio on salvage motor process. However, since many of these between the NCIC Vehicle File and the vehicles and parts is also indicative of small dealers do not have computerized NICB. The CJIS Advisory Policy Board the type of businesses that currently inventories that can be easily forwarded approved this interface and a ‘‘mirror report salvage data to the NICB. The to the NICB, telephonic and facsimile image’’ system became operational in companies reporting salvage to the NICB inquiries of the NSPMVIS will be June 1994, providing the NICB with the are organizations that have a direct allowed. capability to process VINs against the interest in reducing or eliminating the NCIC Vehicle File. The NICB already market for stolen parts. Thus, one would How Will the NSPMVIS Be serves as a central repository of key not expect to discover a large volume of Implemented? vehicle theft data, including theft stolen parts from processing the At this time, it is expected that the reports, export data, and titling inventories of these organizations NICB will serve as the NSPMVIS System information. against the NCIC Vehicle File. Administrator. As envisioned by the FBI It is important to note that the and the NICB, the NSPMVIS will What Were the Results of the Pilot NSPMVIS pilot project consistently operate as a large data exchange system. Project? found ‘‘bad VINs’’ being reported to the Participants will conduct NSPMVIS Following the completion of the work NICB by the participants. ‘‘Bad VINs’’ inspections and all VIN data will be of the Committee and delivery of its are those that do not correspond to an transmitted to the NICB by an electronic final report in January 1995, the FBI and actual 17 character VIN assigned by a tape, E-mail, electronic file transfer, fax, the NICB agreed to conduct a pilot manufacturer. Almost four percent of all or telephone. After automatically project in order to test the concept and VINs reported to the NICB during 1995 creating a file that retains all incoming feasibility of the System. The pilot were ‘‘bad VINs.’’ The large number of VINs, the date and time of the project began in March 1995 in Texas, ‘‘bad VINs’’ is due mainly to human verification request, the identity of the and expanded to Illinois in July 1995. error, including difficulty in reading the system participant from which the However, VINs from salvage motor Mylar stickers that contain the VINs and request was made, and the name and vehicles and covered major parts were misidentifying or transposing the other information regarding the collected from all fifty states and numbers and letters during inventory or individual seeking verification of stolen checked against the NSPMVIS for the when they are reported to the NICB. passenger motor vehicle parts through a entire year. The theft rate during the Following the completion of the pilot system participant under the NSPMVIS, pilot project for salvage motor vehicles project, the FBI submitted to the the System will perform its primary and their covered major parts was .34 Attorney General and Congress a report function: checking the VINs against the percent. This means that less than one- on the pilot along with a national mirror image of the NCIC Vehicle File half of one percent of the salvage motor implementation study. The study maintained at NICB Headquarters. As a vehicles and covered major parts explained that the goal of the NSPMVIS result of this process, any resulting theft checked against the System were is to reduce the market for stolen major confirmations based on the VIN inquiry actually stolen. component parts. Thus, processing the would be identified prior to any sale or There are several reasons for the low covered inventories of all insurers and transfer of the vehicle or its covered theft ratio, and they do not necessarily parts dealers against the NSPMVIS is major parts to the consumer. accurately indicate the potential crucial to the overall success of the The NSPMVIS System Administrator effectiveness of the stolen parts system. With the cooperation of major will query the NCIC Vehicle File to information system. The primary reason associations, such as the Automotive determine whether there is an active for the low theft ratio is due to the Recyclers Association, which estimates theft record for any of the specific VINs. inconsistency of the current parts that it collects VIN data from Depending on the result of the query, marking regulations and the approximately two-thirds to three- the System will either (1) corresponding state laws for recording fourths of the parts industry, the simultaneously send a theft notice to these VIN numbers. Most parts dealers NSPMVIS will be assured of receiving a law enforcement and the inquiring throughout the country inventory a high level of participation with a entity (system participant) when there is motor vehicle and its major parts based minimal impact on the affected an active theft record for a VIN in NCIC; only on the master VIN of the motor businesses. Likewise, the NICB receives or, (2) automatically send a unique vehicle. All parts removed from a VIN data from approximately 60 percent authorization number to the system specific motor vehicle were checked of the insurance industry so that a high participant when there is no NCIC theft against our NCIC Vehicle File based on level of participation can also be record, allowing for the sale or transfer the master VIN of the vehicle. Thus, if assured from this industry by utilizing of the vehicle or part. In the case of a there are no stolen vehicles in a given existing data transfer mechanisms. One System theft confirmation, the following
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message will be sent to the system salvagers, dismantlers, recyclers, and This proposed rule also requires participant attempting to sell or transfer repairers) to inspect salvage and junk salvagers, dismantlers, recyclers, and the vehicle, or sell, transfer, or install motor vehicles for the purpose of repairers, prior to selling, transferring, the covered major parts: collecting both the master VIN of the or installing covered major parts marked The vehicle or part queried has been vehicle and the part numbers for any with an identification number, to reported stolen and the sale or transfer of this covered major parts that possess the VIN inspect those major parts that they have vehicle or the sale, transfer, or installation of or a derivative of the VIN. Participants obtained by any means unless the theft this part must be terminated. Law would then enter this data into the report status of a vehicle from which enforcement has been provided the details System to verify the theft status of both those parts were derived had been regarding this inquiry. vehicles and of covered major parts. The previously verified by an insurance As with the file created from the inspecting of major parts and the carrier who provided a uniform incoming VINs, the NSPMVIS also verifying of part theft status by all verification document in a form automatically creates a results file, participants would be desirable because approved by the Attorney General (the which retains all of the theft hits most salvage and junk motor vehicles aforementioned uniform verification generated by the System, and a response enter the stream of commerce through document provided by an insurance file, which retains all of the an insurer or self-insured entity. carrier exempts covered major parts authorizations generated by the System. The Anti Car Theft Act, however, derived from that vehicle from the Each of these files has a date and time does not require insurers to verify the NSPMVIS verification). This proposed stamp associated with each theft hit or theft report status of a vehicle’s major rule also requires such entities then to authorization. The actual theft notices parts and does not impose any verify the theft report status of covered or authorization numbers are sent to the requirements on self-insured entities. In major parts by using the VINs of those system participant by the same means of the absence of any statutory direction on parts or their derivative vehicles as a communication in which the original these points, the proposed rule does not basis for comparison with reported requests were received by the require insurers or self-insured entities stolen vehicle or covered major part NSPMVIS. System participants are to inspect or report on covered major VINs on file in the NSPMVIS. The responsible for notifying purchasers or parts. Nevertheless, it was clear to the inspection and verification transferees of the authorization number Committee that the effectiveness of the requirements will ensure that covered in any written form they deem proposed rules in successfully reducing major parts are inspected prior to the appropriate, but consistent with the the incidence of car theft would be repair or dismantling of a vehicle. notification requirements set out in this greatly enhanced if the requirement to C. Voluntary inspection and reporting proposed rule. report on covered major parts extended The Department encourages insurers If the NSPMVIS cannot verify the VIN to insurers in the same way that it does to voluntarily conduct inspections of in a ‘‘timely manner,’’ an interim to other NSPMVIS participants, covered major parts and then to report authorization will be provided to the salvagers, dismantlers, recyclers, and to the NSPMVIS any specific parts system participant. Any organization repairers. The Committee concluded inspected. The Department also reporting ‘‘bad VINs’’ will be notified of that the insurance industry and self- encourages such entities voluntarily to the incorrect VINs and will be required insured entities that deal in salvage and report to the purchaser or transferee of to correct the VINs prior to receiving an junk motor vehicles should share the vehicle the identification number of authorization to sell or transfer the responsibility for verifying the theft specific parts the entity inspected and vehicle or sell, transfer, or install the status of covered major parts. In light of reported. part. these considerations, and the clear All information collected by the intent of the Act to reduce vehicle theft D. Marginal Costs System Administrator as part of the through a comprehensive reporting The Department acknowledges that verification request process under the scheme, the Department requests the Anti Car Theft Act’s inspection NSPMVIS will be maintained by the comments and suggestions on a requirement imposes some costs on the System Administrator, as custodian for legislative amendment to the Act entities affected. Insurance carriers the FBI. The NCIC Privacy Act system extending mandatory inspection and selling comprehensive motor vehicle of records notice will be modified to reporting of major covered parts to trade insurance already verify the VINs of reflect the collection, maintenance, and organizations, insurers, self-insured junk or salvage motor vehicles of which use of this information. The records entities, and/or other interested parties. they obtain possession as a part of collected by the System Administrator B. Requirements normal business practices. Whether or will be provided to the FBI upon its not a claim is honored is dependent in request. In accord with the routine uses This proposed rule requires insurance some cases on verifying that the vehicle set forth in the NCIC Privacy Act system carriers to inspect only for the master in question is in fact the insured of records notice, the information VIN on salvage and junk motor vehicles vehicle. The cost imposed on insurance collected by the System Administrator that they have obtained through any carriers by the Act amounts to the may be disclosed to criminal justice means. Following inspection, insurers administrative costs of conducting the agencies to meet criminal justice must report the master VIN to the theft status verification with the objectives, and as otherwise provided System to determine whether or not the NSPMVIS. for in routine uses. vehicle has been reported stolen. Once Persons engaged in the business of What are NSPMVIS Inspections? the theft report status is verified, the salvaging, dismantling, recycling, or insurers are required to provide the repairing passenger motor vehicles A. Background transferee with a uniform verification already conduct some form of vehicle The NSPMVIS Federal Advisory document in a form approved by the inspection and inventorying for their Committee concluded that—in order to Attorney General. As previously own business purposes when adding, meet the intent of the law and to reduce explained, this proposed rule does not among other items, the covered major theft successfully—it would be desirable require such entities to inspect or verify parts to their inventories. As a result of for all NSPMVIS participants (insurers, the theft status of covered major parts. that business function, they ordinarily
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already have the equipment necessary to of the System. First, there is no order to educate those entities on how perform the NSPMVIS inspection. The provision in the Act for funding the to identify the parts marking for missing costs imposed on these entities amount NSPMVIS, system participants, or the major parts from a specific vehicle, as to the administrative costs of logging the states and federally recognized tribes for well as for recovered major parts found VIN or its derivative of the covered parts inspection, salvage reinspection, separate from the original vehicle. Once major parts and conducting the theft or law enforcement participation. In identified, those markings can be used status verification with the NSPMVIS. addition, there is no current funding for to enter missing major parts into the As a result, the Department believes the operation of the System through NCIC, which provides the records that that the additional, marginal costs for a either the FBI or the NICB. The NICB will populate the NSPMVIS, and to NSPMVIS inspection to the affected estimated that it will require $850,000 inquire as to the theft status of those entities should be minimal. These to administer the System in the initial recovered parts. Increasing the entry of regulations require only those year of operation and $400,000 in stolen parts into the NCIC is an inspections mandated by statute and the subsequent years. A second issue that important goal that can be achieved reporting of relevant information that is might have an impact on the quickly through a national cooperative either statutorily mandated or already in effectiveness of the System involves the effort directed at educating law the custody of the affected entity. lack of follow-up motor vehicle enforcement. Further, this proposed rule suggests inspections to identify covered major allowing participants to contract out the parts and their VINs or the derivatives H. Federally Recognized Tribes inspection process in order to relieve of their VINs. The Act specifies that The Department recognizes the fact some of the burden of initial cash insurance carriers need only verify the that federally recognized tribes in some outlays that would be required if they theft report status of a motor vehicle states are issuing motor vehicle do not presently possess the necessary being transferred and provide that registrations and titles. This proposed equipment to conduct inspections and/ verification to the purchaser. If the rule applies to any motor vehicle and its or verifications. vehicle is stolen, the transfer does not parts where the motor vehicle has been The FBI already operates and proceed; if the vehicle is not stolen, the registered and titled in the jurisdiction maintains a national information purchaser can then rely on that of a federally recognized tribe. As a system, the NCIC, which includes verification to conduct additional result, references to federally recognized information concerning stolen vehicles transfers of either the vehicle itself or its tribes are included in the definitions and vehicle parts. Currently, only the major parts. Therefore, it is possible that section and other relevant parts of the law enforcement and criminal justice an insurance carrier could unknowingly proposed rule. communities may enter records into, or transfer a motor vehicle containing query, the NCIC database. Many people stolen parts and the transferee would, as Procedural Matters: have been critical of the NCIC’s a result, unknowingly possess and Initial Regulatory Flexibility Analysis effectiveness and law enforcement’s possibly transfer stolen parts contained ability to reduce thefts of stolen vehicle within that vehicle. The fact that under Congress enacted the Regulatory parts. Their concerns stem from the lack certain circumstances the transfer of Flexibility Act of 1980 (RFA), as of stolen motor vehicle part information stolen items can occur as part of a amended, 5 U.S.C. 601–612, to ensure entered into the NCIC database. In the regulated transaction designed to reduce that Government regulations do not past, this data was scarce, in part, such an occurrence undermines the unnecessarily or disproportionately because the inspected parts did not credibility and effectiveness of the burden small entities. The RFA requires contain a unique numerical identifier. NSPMVIS. a regulatory flexibility analysis if a rule The FBI believes that entry of such would have a significant economic F. Program Evaluation information into the NCIC will increase impact, either detrimental or beneficial, with the advent of mandatory parts The impact and effectiveness of the on a substantial number of small marking, thus enabling law enforcement NSPMVIS as a tool for reducing auto entities. This proposed rule was drafted to be more effective in conducting these theft is best assessed after the System in a way designed to minimize the types of stolen motor vehicle and motor has been in operation for a meaningful impact that it has on small business vehicle parts investigations. period of time. After a review of a while meeting the Act’s objectives. The Department requests comments timely evaluation of the NSPMVIS and The FBI solicited recommendations and suggestions on modifications to this additional information on the overall for establishing the NSPMVIS from proposed rule that will further enhance auto theft issue, the Attorney General those industries and organizations that flexibility in participating in the will, as required by 49 U.S.C. 33103(d), are directly impacted by the System. A program and reduce participant costs, undertake a ‘‘Long Range Review of Federal Advisory Committee was while still complying with the Act. Effectiveness’’ regarding the theft formed that consisted of representatives prevention standards that require of the industries and entities most likely E. Program Effectiveness Issues marking of covered major parts installed to be affected by the NSPMVIS. In order to accurately measure the on certain vehicle lines. Members of this committee included reduction in the theft of motor vehicle representatives of the motor vehicle major parts as a result of the NSPMVIS, G. Supplementary Solutions industry, the law enforcement the System will need to be fully It is equally important for the law community, and the insurance, operational and in place for a significant enforcement community to increase the dismantling, repair, recycling, and period of time, possibly one to two entry of information concerning stolen salvage industries. The Committee years, in order to allow for full major parts into NCIC in order to developed a set of recommendations on compliance and cooperation by all assemble a comprehensive database of the development of the stolen parts and participants, especially parts dealers stolen vehicle parts. Once the final motor vehicle system that served as the and law enforcement. major parts marking regulations are in basic guideline under which the The national implementation study effect, the FBI will forward information NSPMVIS will be implemented. The also raised several issues that may concerning the new standards to federal, burden of motor vehicle inspections prevent the successful implementation state, and local law enforcement in cannot be shared fully among the
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affected industries as initially entities beyond those requirements $50.00 per vehicle. Since affected recommended because, as previously needed to reduce the rate and number industries already conduct thorough discussed, the Act does not require the of motor vehicle and major motor vehicle inspections and inventorying, insurance industry to inspect a motor vehicle part theft. Moreover, the additional NSPMVIS inspection vehicle’s major component parts. requirements have been drafted so as represents only a small portion of the The NSPMVIS applies to salvage and not to disrupt existing business total cost estimate. In addition, junk motor vehicles and those covered practices. For example, inventories equipment required to perform major parts that are labeled with the existing prior to the date of NSPMVIS inspections already exists; master VIN or a derivative of that implementation are not required to be therefore, start-up costs are negligible. number. The only parts affected by the inspected, and covered major parts Thus, this proposed rule will not result System are original major parts that are damaged to such an extent that the VIN in the expenditure by state, local, and dismantled, recycled, salvaged, or markings are unreadable are also tribal governments, in the aggregate, or otherwise removed from motor vehicles exempt from inspection. Therefore, we by the private sector, of $100,000,000 or and that possess a parts marking label have determined under the RFA that more in any one year, and it will not with the 17-character VIN or a this proposed rule would not have a significantly or uniquely affect small derivative of the VIN. significant economic impact on a governments. Therefore, no actions are The NSPMVIS does not apply to the substantial number of small entities. deemed necessary under the provisions sale of new vehicles, manufacturer The Department is not aware of any of the Unfunded Mandates Reform Act replacement parts, or new after-market relevant Federal rules that duplicate, of 1995. parts. These parts have unique labels overlap, or conflict with this proposed that identify them as new replacement rule. Small Business Regulatory Enforcement parts and are not required by NHTSA to Fairness Act of 1996 possess parts-marking labels. For Executive Order 12866: Regulatory The FBI has solicited example, parts manufactured by a parts Planning and Review recommendations for establishing the manufacturer, that are distributed to This regulation has been drafted and NSPMVIS from those industries and replace or repair original parts, are not reviewed in accordance with Executive organizations that are directly impacted required to be inspected and checked Order 12866, Regulatory Planning and by the System. A NSPMVIS Federal against the NSPMVIS. Review, section 1 (b). The Department Advisory Committee was formed, Based on information from the NICB, has determined that this rule is a which we anticipate will serve as the composed of members of the motor ‘‘Significant Regulatory Action’’ under vehicle industry and the law NSPMVIS System Administrator, it is Executive Order 12866, Regulatory estimated that there are approximately enforcement community. Committee Planning and Review, section 3 (f), and members from insurance, repair, 3,000 insurance companies nationwide accordingly this rule has been reviewed that transfer nearly 2.5 million salvage recycling, and salvage associations by the Office of Management and represented the interests of the small and junk motor vehicles annually. The Budget. NICB estimates that currently 60 businesses that will be affected by the percent, or 1.4 million, of these salvage Executive Order 13132: Federalism NSPMVIS. The Committee developed a set of recommendations on the and junk vehicles contain major parts This proposed rule will not have a development of the System, which will marked with the VIN that would substantial direct effect on the States, on serve as the basic guideline under ultimately be required to be inspected the relationship between the national which the NSPMVIS will be through the NSPMVIS. Furthermore, Government and the States, or on the implemented. This proposed rule is not based on 1996 insurance data reported distribution of power and a major rule as defined by section 251 to the NICB, over 50 percent of these responsibilities among the various of the Small Business Regulatory motor vehicles will originate from the levels of government. Therefore, in Enforcement Fairness Act of 1996, 5 ten largest insurance groups transferring accordance with Executive Order 13132, U.S.C. 804, and it will not result in an salvage and junk motor vehicles. The it is determined that this proposed rule annual effect on the economy of FBI also estimates that there are about does not have sufficient Federalism $100,000,000 or more; a major increase 135 motor vehicle salvage pools that implications to warrant preparation of a in costs or prices; or significant adverse auction 2.5 million salvage and junk Federalism summary impact statement. motor vehicles annually. In addition, effects on competition, employment, there are an estimated 10,000 motor Executive Order 12988: Civil Justice investment, productivity, innovation, or vehicle recyclers nationwide handling Reform on the ability of United States-based approximately 8 million salvage and This rule meets the applicable companies to compete with foreign- junk vehicles annually. standards set forth in sections 3 (a) and based companies in domestic and Because the entities presently 3 (b) of Executive Order 12988, Civil export markets. This proposed rule has providing salvage and recycling services Justice Reform. been forwarded to the Small Business are primarily small businesses, this Administration for its review. Unfunded Mandates Reform Act of 1995 proposed rule was developed and Paperwork Reduction Act reviewed, where possible, with the The NICB estimates that needs and circumstances of small approximately 1.5 to 3 million vehicles The Department has submitted the businesses specifically in mind. The will be affected annually as a result of following information collection request Department has included a number of the NSPMVIS implementation. The to the Office of Management and Budget significant alternatives in this proposed cumulative cost per year of the System (OMB) for review and approval in rule that would accomplish the can be estimated to be only a small accordance with the procedures of the objectives of the Act and minimize any portion of the total cost of inspecting a Paperwork Reduction Act of 1995, significant economic impact on small vehicle. The FBI and the NICB have Public Law No. 104–13, 109 Stat. 163. entities, such as allowing the use of contacted a number of affected entities The proposed information collection is contractors for parts inspections. It has that estimate complete vehicle published to obtain comments from the also sought to avoid burdens on outside inspections to cost between $10.00 to public and affected agencies.
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Public comments are encouraged and the following entities or persons must Motor Vehicles, and Organization and will be accepted until June 10, 2002. We request such verification: an insurance functions (Government agencies). request written comments and carrier; a person lawfully selling or Accordingly, for the reasons set forth suggestions from the public and affected distributing vehicle parts in interstate in the preamble and pursuant to 49 agencies concerning the proposed commerce; or an individual or U.S.C. 33109, Title 28 of the Code of collection of information. Your enterprise engaged in the business of Federal Regulations is proposed to be comments should address one or more repairing passenger motor vehicles. amended by adding Part 89 to read as of the following four points: (5) An estimate of the total number of follows: (1) Evaluate whether the proposed respondents and the amount of time collection of information is necessary estimated for an average respondent to PART 89—NATIONAL STOLEN for the proper performance of the respond: 13,500 respondents at an PASSENGER MOTOR VEHICLE functions of the agency, including average of one hour per week to INFORMATION SYSTEM whether the information will have respond. practical utility; Sec. (6) An estimate of the annual total 89.1 Purpose and scope. (2) Evaluate the accuracy of the public burden (in hours) associated with agency’s estimate of the burden of the 89.2 Definitions. the collection: 702,000 total burden 89.3 The System Administrator. proposed collection of information, hours. 89.4 Participation in the National Stolen including the validity of the If additional information is required Passenger Motor Vehicle Information methodology and assumptions used; contact: Mr. Robert B. Briggs, Clearance System. (3) Enhance the quality, utility, and Officer, United States Department of 89.5 Responsibilities of insurers. clarity of the information to be Justice, Information Management and 89.6 Responsibilities of persons engaged in collected; and Security Staff, Justice Management salvaging, dismantling, recycling, or repairing passenger motor vehicles. (4) Minimize the burden of the Division, 1331 Pennsylvania Avenue, collection of information on those who 89.7 Requesting information from the Northwest, Suite 1220, Washington, DC National Stolen Passenger Motor Vehicle are to respond, including through the 20530. use of appropriate automated, Information System. Plain Language 89.8 Authorizations and notifications. electronic, mechanical, or other 89.9 Certification in lieu of a system technological collection techniques or Executive Order 12866 requires each response. other forms of information technology, agency to write regulations that are 89.10 Circumstances in which a verification e.g., permitting electronic submission of simple and easy to understand. The is not required. responses. Presidential memorandum of June 2, 89.11 Contracting out the inspection Comments and/or suggestions process. 1998, requires that new regulations be regarding the item(s) contained in this 89.12 Notification of law enforcement. written in plain language. The notice, especially regarding the 89.13 Limited immunity. Department of Justice invites your estimated public burden and associated comments on how to make this Authority: 49 U.S.C. 33109. response time, should be directed to proposed rule easier to understand, Stephen A. Bucar, Supervisory Special § 89.1 Purpose and scope. including answers to questions such as Agent, Federal Bureau of Investigation, (a) This part establishes the National the following: CJIS Division, Module C–3, 1000 Custer Stolen Passenger Motor Vehicle (1) Are the requirements in the Hollow Road, Clarksburg, WV 26306, Information System (NSPMVIS or proposed rule clearly stated? (304) 625–2751. System), pursuant to 49 U.S.C. 33109, (2) Does the proposed rule contain which requires the Attorney General to Overview of This Information technical language or jargon that implement a national system to verify Collection: interferes with its clarity? the theft status of salvage and junk (1) Type of Information Collection: (3) Does the format of the proposed motor vehicles and covered major parts. New collection. rule (grouping and order of sections, use (b) This part applies to salvage and (2) Title of the Form/Collection: of headings, paragraphing, etc.) aid or junk motor vehicles and those covered NSPMVIS. reduce its clarity? major parts on passenger motor vehicle (3) Agency form number, if any, and (4) Would the proposed rule be easier lines designated by the National the applicable component of the to understand if it was divided into Highway Traffic Safety Administration Department of Justice sponsoring the more (or shorter) sections? (A ‘‘section’’ (NHTSA). The inspection requirement collection: No form. CJIS Division, FBI, appears in bold type and is preceded by does not apply to: Department of Justice. the symbol ‘‘§ ’’ and a numbered (1) New vehicles; (4) Affected public who will be asked heading, for example § 89.1 Purpose and (2) Manufacturer replacement parts; or required to respond, as well as a brief scope.) (3) New after-market parts; or abstract: Primary: Business or other for- (5) Is the description of the proposed (4) Motor vehicles or major parts profit (Motor vehicle insurers, rule in the SUPPLEMENTARY INFORMATION entered into the inventory of a system dismantlers, recyclers, repairers, and section of this preamble helpful in participant prior to the effective date salvagers). Other: assorted motor vehicle understanding it? How could this of the System. parts dealers. Brief Abstract: The description be more helpful in making Department of Justice is implementing the proposed rule easier to understand? § 89.2 Definitions. the NSPMVIS, 49 U.S.C. 33109, by Please send any comments you have In this part, issuing regulations to establish a on the clarity of the proposed rule to the After-market Part means a vehicle national system for verifying the theft address specified in the ADDRESSES component part built and distributed by status of salvage and junk (non- section. a parts manufacturer to replace or repair repairable) motor vehicles and major a vehicle’s original parts. parts marked with a VIN or a derivative List of Subjects in 28 CFR Part 89 Authorization Number means a of that number. Under specific Administrative practice and unique number provided by the System conditions detailed in the regulations, procedure, Crime, Law Enforcement, Administrator to the system participant
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that allows for the sale or transfer of the manufacturer to replace or repair a corner of the dashboard beneath the vehicle or covered major part. vehicle’s original part. windshield. Chop Shop means a building, lot, Manufacturer’s Certificate of Origin Vehicle Line means the name that a facility, or other structure or premise at means a document issued by the manufacturer of motor vehicles applies which at least one person engages in manufacturer of a vehicle that to a group of motor vehicle models of receiving, concealing, destroying, authenticates the vehicle’s origin of the same make that have the same body disassembling, dismantling, manufacture and that is accepted by a or chassis, or otherwise are similar in reassembling, or storing a passenger state, federally recognized tribe, or construction or design. A ‘‘line’’ may, motor vehicle or passenger motor country for titling application purposes. for example, include 2-door, 4-door, vehicle part that has been unlawfully New After-Market Part means a station wagon, and hatchback vehicles obtained: vehicle component part built and of the same make. (1) To alter, counterfeit, deface, distributed by other than the Verification means that the master destroy, disguise, falsify, forge, manufacturer of the original vehicle but VIN of salvage and junk motor vehicles obliterate, or remove the identity of the which is designed to replace or repair a and/or the vehicle identification vehicle or part, including the vehicle vehicle’s original part. number or its derivative of any major identification number or a derivative of New Vehicle means any newly parts have been checked against the that number; and manufactured vehicle supported by a National Stolen Passenger Motor (2) To distribute, sell, or dispose of manufacturer’s certificate of origin and Vehicle Information System and the the vehicle or part in interstate or that has not previously been titled in System Administrator has provided an foreign commerce. any state, federally recognized tribe, or authorization number to sell, transfer, or Covered Major Part means a major country. install the vehicle or major parts. Salvage Motor Vehicle means a part marked with a vehicle vehicle that has been damaged by § 89.3 The System Administrator. identification number or its derivative. collision, fire, flood, accident, trespass, The System Administrator is the Derivative of a Vehicle Identification or other incident to the extent that its entity designated by the Attorney Number (VIN) means a matching fair salvage value plus the cost of General to have custodial possession portion of the vehicle identification repairing the vehicle for legal operation and provide maintenance and operation number, generally the last eight on roads or highways exceeds the fair of the System under Attorney General characters of that number. market value of the vehicle prior to the oversight through the Federal Bureau of Inspection means locating the master incident causing the damage. A salvage Investigation. Vehicle Identification Number of vehicle may be rebuilt, retitled, and salvage and junk motor vehicles and/or § 89.4 Participation in the National Stolen allowed to legally operate on the road. the vehicle identification number or its Passenger Motor Vehicle Information This definition includes any individual derivative of any covered major parts System. state or federally recognized tribe’s and verifying the theft status of those The following individuals, definition for a vehicle that is declared vehicles or parts with the System. businesses, or organizations, must a total loss or economically impractical participate in the System: Junk Motor Vehicle means a vehicle to repair. that is non-repairable. This term (a) Any insurance carrier selling System means the National Stolen comprehensive motor vehicle insurance indicates a vehicle that is incapable of Passenger Motor Vehicle Information operation on roads or highways and has that obtains possession of and transfers System. a junk or salvage motor vehicle; and, no value except as a source of parts or System Administrator means an scrap. This definition includes any (b) Any person engaged in the organization approved by the Attorney business of salvaging, dismantling, individual state and federally General to have custodial possession recognized tribe’s definition for a recycling, or repairing passenger motor and provide system maintenance and vehicles. vehicle that is declared a total loss or operation of the System under Attorney economically impractical to repair. General oversight through the Federal § 89.5 Responsibilities of insurers. Major Part means the engine; Bureau of Investigation. (a) Any insurance carrier selling transmission; right front fender; left System Participant means any person, comprehensive motor vehicle insurance front fender; hood; right front door; left business, or organization mandated to that obtains possession of and transfers front door; right rear door; left rear door; submit vehicle identification number a junk or salvage motor vehicle is: sliding or cargo door(s); front bumper; information as outlined in this part. (1) Required to verify through the rear bumper; right rear quarter panel Theft Confirmation means that the System whether the salvage or junk (passenger cars); left rear quarter panel master VIN of salvage and junk motor motor vehicle is reported as stolen and (passenger cars); right-side assembly vehicles and/or the vehicle not recovered; (Multipurpose Passenger Vehicles identification number or its derivative (2) Required to provide to the (MPVs); left-side assembly (MPVs); of any major parts have been checked purchaser or transferee of the vehicle pickup box, and/or cargo box (Light- against the System and the System has from the insurance carrier a written Duty Trucks); rear door(s) (both doors in provided a notice of an active report response identifying the master VIN and case of double doors); decklid, tailgate, that the vehicle or major part has been verifying that the vehicle has not been or hatchback (whichever is present); reported as stolen and not recovered, reported as stolen or, if reported as grille; the trunk floor pan; frame; and and that, as a result, it may not be sold, stolen, that the carrier has recovered the any other part of a passenger motor transferred, or installed. vehicle and has proper legal title to the vehicle that the Secretary of Vehicle Identification Number (VIN) vehicle; Transportation by regulation specifies as means a unique identification number (3) Encouraged to report to the System comparable in design or function to any assigned to a passenger motor vehicle by all major parts identified as missing of the parts previously listed. a manufacturer in compliance with from recovered salvage and junk motor Manufacturer Replacement Part applicable regulations; the master VIN, vehicles, that an insurance carrier means a vehicle component part built which applies to the entire vehicle, is obtains possession of and transfers to a and distributed by a motor vehicle predominantly located in the upper left purchaser or transferee;
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(4) Encouraged to report to the System requirements, the written form must verifications conducted pursuant to this the results of any specific major parts also include the following notation as section. inspected; and, the first text at the top of the form: ‘‘This (5) Encouraged to provide to the System verification was voluntarily § 89.8 Authorizations and notifications. purchaser or transferee of the vehicle conducted upon request by a system (a) Any person engaged in the identification of the specific major parts participant and does not qualify for the business of salvaging, dismantling, that were inspected and reported to the provisions under 49 U.S.C. recycling, or repairing passenger motor System, and to advise the purchaser or 33110(b)(2)(A) & (B) and 49 U.S.C. vehicles must provide verification to transferee whether the parts were 33111(b)(2), which allow for the transfer whomever the participant transfers or reported as stolen. of a motor vehicle following an inquiry sells any covered major part. (b) Any insurance carrier selling of the System where the theft status of (b) Insurance carriers selling comprehensive motor vehicle insurance the vehicle has not been established.’’ comprehensive motor vehicle insurance who honors a request under § 89.7 must must provide verification to whomever provide a written response pursuant to § 89.7 Requesting information from the they transfer or sell any salvage or junk paragraph (b)(4) of that section verifying National Stolen Passenger Motor Vehicle motor vehicle. Information System. (c) A system participant may provide the theft status only of the vehicle or the verification required by this part in part. In addition to those requirements, (a) An individual or entity who is any written format it chooses, provided the written form must also include the neither an insurance carrier nor engaged the verification: following notation as the first text at the in the business of salvaging, dismantling, recycling, or repairing (1) Identifies the vehicle’s VIN or the top of the form: ‘‘This System applicable major part’s VIN or its verification was voluntarily conducted passenger motor vehicles, who intends to transfer a passenger motor vehicle or derivative; and, upon request by a system participant (2) In the case of an insurance carrier passenger motor vehicle major part, may and does not qualify for the provisions selling comprehensive motor vehicle request from an insurance carrier or a under 49 U.S.C. 33110(b)(2)(A) & (B) insurance, states that the System was person engaged in the business of and 49 U.S.C. 33111(b)(2), which allow checked and that the subject motor salvaging, dismantling, recycling, or for the transfer of a motor vehicle vehicle has not been reported as stolen repairing passenger motor vehicles that following an inquiry of the System or, if reported as stolen, that the carrier a verification with the System where the theft status of the vehicle has has recovered the vehicle or major parts voluntarily be performed to determine not been established.’’ and has proper legal title to the vehicle whether the vehicle or major part is or major parts; or, § 89.6 Responsibilities of persons reported as stolen. (3) In the case of a person engaged in engaged in salvaging, dismantling, (b) Any system participant may, but is recycling, or repairing passenger motor the business of salvaging, dismantling, vehicles. not required to, respond to such a recycling, or repairing passenger motor request pursuant to this section (a) Any person engaged in the vehicles, states that the System was provided the following procedures are checked and that the major part has not business of salvaging, dismantling, followed: recycling, or repairing passenger motor been reported as stolen. (1) Any requestor of a System vehicles may not knowingly sell in verification must appear in person. § 89.9 Certification in lieu of a System commerce or transfer or install a response. covered major part without: (2) Prior to any verification with the System of the theft status of a motor System participants may transfer a (1) Verifying through the System that motor vehicle or major part in those the major part has not been reported as vehicle or part, the system participant must confirm the identity of the instances where the System cannot stolen; and, provide a response within a timely (2) Providing the purchaser or requestor by checking two forms of manner. A ‘‘timely manner’’ is defined transferee with a written response identification to be provided by the to be a response by the end of the next identifying the VIN (or derivative of that requestor. One form of identification federal business day for any inquirer number) of that major part and verifying must be a photographic identification. (system participant) who has made a that the major part has not been (3) Prior to any verification with the ‘‘reasonable effort’’ to verify the status of reported as stolen or, if reported as System of the theft status of a motor a vehicle or a major part. A ‘‘reasonable stolen in the System, that the vehicle or part, the system participant effort’’ is defined as attempting to gain participant has recovered that major must record the identity of the requestor access to the System during normal part and has proper legal title to it; or, including full name, date of birth, business hours and providing the (3) Providing the purchaser or current telephone number, and current correct vehicle or major part transferee with a verification from an address. This information must be information. In those instances where insurance carrier provided in communicated in full to the System the System cannot provide a verification accordance with 49 U.S.C. 33110, when Administrator as part of the verification in a timely manner, the System the insurance carrier has verified with request. Administrator must provide a certificate the System that the vehicle from which (4) Any system participant, including to the system participant, or a the major part was derived was not insurance carriers selling designated contracting agent, which reported as stolen, or that the insurance comprehensive motor vehicle insurance, permits the transfer of the vehicle or carrier has not established whether that who honor requests under this section major part. vehicle has been stolen. must provide a written response that (b) Any person engaged in the conforms to the requirements contained § 89.10 Circumstances in which a business of salvaging, dismantling, in §§ 89.5 and 89.6 as determined by the verification is not required. recycling, or repairing passenger motor character of the subject item to be (a) The verification requirement does vehicles who honors a request under verified with the System. not apply to: § 89.7 must provide a written response (c) The provisions established by 49 (1) The transfer of new vehicles; pursuant to paragraph (b)(4) of that U.S.C. 33110(b)(2)(A) & (B) and 49 (2) The transfer of manufacturer section. In addition to these U.S.C. 33111(b)(2) do not apply to replacement parts;
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(3) The transfer of new after-market § 89.12 Notification of law enforcement. Commission might address those unmet parts; (a) The System will provide automatic needs. (4) The subsequent transfer of a motor notification on stolen vehicle and major DATES: Comments are due on or before vehicle, the transferor of which has part theft confirmations to: May 24, 2002, and reply comments are received, within the previous 180 (1) A law enforcement agency having due on or before June 24, 2002. days, a verification in accordance investigative jurisdiction over the ADDRESSES: Federal Communications with 49 U.S.C. 33110 from an locality in which the inquiring system Commission, William F. Caton, Office of insurance carrier selling participant is located; and the Secretary, 445—12th Street SW, comprehensive motor vehicle (2) The law enforcement agency TW–A325, Washington, DC 20554. See insurance that the vehicle has not originally reporting the vehicle or major SUPPLEMENTARY INFORMATION for been reported as stolen; part theft. information on additional instructions (b) If the system participant receives for filing paper copies. (5) The subsequent transfer of a major a theft notification message from the FOR FURTHER INFORMATION CONTACT: Joi part removed from a motor vehicle, NSPMVIS, the transaction involving Roberson Nolen, Wireline Competition the transferor of which has received, that motor vehicle or major part must be Bureau, 202–418–1537. within the previous 180 days, a terminated, unless the system SUPPLEMENTARY INFORMATION: The verification in accordance with 49 participant is an insurance carrier that Commission released the Order on U.S.C. 33110 from an insurance has recovered the vehicle and has Reconsideration in CC Docket No. 96– carrier selling comprehensive motor proper legal title to the vehicle. 128. See Implementation of the Pay vehicle insurance that the vehicle has (c) Additional notifications may be Telephone Reclassification and not been stolen; or, needed, as provided in the Privacy Act Compensation Provisions of the (6) The subsequent transfer of a motor systems notice for the National Crime Telecommunications Act of 1996, CC vehicle or major part, the transferor of Information Center. Docket No. 96–128, Order on which has received a certificate § 89.13 Limited immunity. Reconsideration, 11 FCC Rcd 21233 pursuant to § 89.9 stating that the (1996), 61 FR 65341 (Dec. 12, 1996) Any person performing any activity system participant has not been able (Order on Reconsideration) aff’d in part under this part in good faith and with and remanded in part, Illinois Pub. Tel. to establish whether that vehicle or the reasonable belief that such activity major part has been stolen. Ass’n v. FCC, 117 F.3d 555 (D.C. Cir. was in accordance with this part shall 1997), cert. denied sub nom., Virginia (b) System participants may sell or be immune from any civil action State Corp. Comm’n v. FCC, 523 U.S. transfer a motor vehicle or major part in respecting such activity that is seeking 1046 (1998). Subsequently, the those instances in which the motor money damages or equitable relief in Commission issued this Notice of vehicle or major parts are damaged to any court of the United States or a State. Proposed Rulemaking (NPRM) to seek such an extent that the VIN markings Dated: April 3, 2002. comment on issues related to the are inaccessible. VIN markings are John Ashcroft, provision of inmate payphone service. ‘‘inaccessible’’ if the system participant Attorney General. Section 276 of the Communications Act has conducted a thorough examination directs the Commission to ‘‘establish a of the salvage or junk motor vehicle and [FR Doc. 02–8522 Filed 4–8–02; 8:45 am] BILLING CODE 4410–02–P per call compensation plan to ensure covered major parts and has not been that all payphone service providers are able to locate the VIN markings. In this fairly compensated for each and every instance, the seller or transferee of the completed intrastate and interstate call motor vehicle or major part must report FEDERAL COMMUNICATIONS COMMISSION using their payphone. See 47 U.S.C. the inaccessibility to the System and 276(b)(1)(A). The statute specifically provide, in lieu of the authorization, a 47 CFR Parts 1, 61, and 69 includes the provision of inmate System-generated certificate to the telephone service in correctional purchaser or transferee that the [CC Docket No. 96–128; FCC 02–39] institutions within the definition of inspection could not be completed. Implementation of Pay Telephone payphone service. See 47 U.S.C. 276(d). § 89.11 Contracting out the inspection Reclassification and Compensation The Commission seeks comment process. Provisions of the Telecommunications generally on costs associated with the Act of 1996 provision of inmate calling service System participants will be allowed to (ICS). Specifically, the Commission contract out the inspection process, but AGENCY: Federal Communications seeks comment on the commissions any system participant that contracts Commission. demanded by correctional institutions, out inspections must still be identified ACTION: Notice of proposed rulemaking. whether and how any states have to the purchaser or transferee by the addressed the relationship between contracted entity. If a system participant SUMMARY: The Federal Communications these commissions and inmate calling contracts out the inspection tasks, then Commission (Commission) seeks rates, and on any factors unique to the the contracted entity must perform comment in the Implementation of the provision of inmate calling services that verifications for the motor vehicle and Pay Telephone Reclassification and affect the profitability of ICS operations. all covered major parts as would be Compensation Provisions of the The Commission seeks cost and revenue required of the contracting system Telecommunications Act of 1996 data related to local collect calls made participant. In addition, any regulatory rulemaking docket to explore whether from confinement facilities, separate obligations imposed on the system the current regulatory regime applicable from data related to other services participant by this part extend to the to the provision of inmate calling offered by payphone providers. The contracted entity, including those under services is responsive to the needs of Commission seeks comment from states § 89.7, and their adherence thereto by correctional facilities, inmate calling on the use of rate ceilings. The the contracted entity becomes the service (ICS) providers, and inmates, Commission seeks comment on responsibility of the system participant. and if not, whether and how the alternatives to collect calling in the
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inmate environment that might result in rules. The RFA generally defines the tariff filing requirements, and also lower rates for inmate calls while term ‘‘small entity’’ as having the same requires supporting information, which continuing to satisfy security concerns. meaning as the terms ‘‘small business,’’ in some cases includes detailed cost The Commission seeks comment on ‘‘small organization,’’ and ‘‘small data, to be filed by dominant carriers inmate calling service practices that governmental jurisdiction.’’ In addition, with their tariff filings. Incumbent LECs may serve legitimate security needs but the term ‘‘small business’’ has the same are subject to rate level regulation in the have the unintended, and perhaps meaning as the term ‘‘small business provision of their interstate access unnecessary, effect of increasing the concern’’ under the Small Business Act. services. The BOCs and GTE are subject costs incurred by inmates and their A small business concern is one which: to mandatory price cap regulation, and families. Finally, the Commission seeks (1) Is independently owned and several other incumbent LECs have comment on any additional ways to operated; (2) is not dominant in its field entered price caps on an elective basis, reduce costs for inmate service of operation; and (3) satisfies any while smaller incumbent LECs are providers (and, consequently, the costs additional criteria established by the regulated under rate-of-return of inmate calling). Small Business Administration (SBA). regulation. In addition, in markets We have included small incumbent where carriers may have the incentive A. Regulatory Flexibility Analysis and LECs in this present RFA analysis. As and ability to leverage control over Paperwork Reduction Analysis noted above, a ‘‘small business’’ under bottleneck facilities to disadvantage As required by the Regulatory the RFA is one that, inter alia, meets the competitors in related markets, the Flexibility Act of 1980, as amended pertinent small business size standard Commission has developed various (RFA), the Commission has prepared the ( e.g., a telephone communications safeguards to neutralize that ability. present Initial Regulatory Flexibility business having 1,500 or fewer Analysis (IRFA) of the possible employees), and ‘‘is not dominant in its 6. Steps Taken to Minimize Significant significant economic impact on a field of operation.’’ The SBA’s Office of Economic Impact on Small Entities, and substantial number of small entities by Advocacy contends that, for RFA Significant Alternatives Considered the policies and rules proposed in this purposes, small incumbent LECs are not The RFA requires an agency to NPRM. Written public comments are dominant in their field of operation describe any significant, specifically requested on this IRFA. Comments must because any such dominance is not small business, alternatives that it has be identified as responses to the IRFA ‘‘national’’ in scope. We have therefore considered in reaching its proposed and must be filed by the deadlines for included small incumbent LECs in this approach, which may include the comments on the NPRM. The RFA analysis, although we emphasize following four alternatives (among Commission will send a copy of the that this RFA action has no effect on others): (1) The establishment of NPRM, including this IRFA, to the Chief FCC analyses and determinations in differing compliance or reporting Counsel for Advocacy of the Small other, non-RFA contexts. requirements or timetables that take into Business Administration. 4. Local Exchange Carriers account the resources available to small entities; (2) the clarification, 1. Need for, and Objectives of, the Neither the Commission nor the SBA consolidation, or simplification of Proposed Rules has developed a definition specifically compliance or reporting requirements In this proceeding, the Commission for small local exchange carriers. The under the rule for small entities; (3) the seeks comment on the appropriate closest applicable definitions for this use of performance, rather than design, regulatory environment for Inmate type of carrier under SBA rules is for standards; and (4) an exemption from Calling Service (ICS) providers. In wired telecommunications carriers. The coverage of the rule, or any part thereof, choosing the appropriate regulatory most reliable source of information for small entities. environment we ask interested parties to regarding the number of LECs address how the Commission can best nationwide appears to be the data that 7. Overall Objective achieve the goals set forth by Congress we collect annually in connection with The overall objective of this in section 276 of the Act. the Telecommunications Relay Service proceeding is to establish an appropriate (TRS). According to our most recent regulatory framework for ICS providers 2. Legal Basis data, there are 1,335 incumbent LECs. pursuant to section 276 of the Act. The The legal basis for any action that may We estimate that 1,037 of those carriers NPRM seeks comment on specific issues be taken pursuant to the NPRM is are small, pursuant to the SBA’s size related to the provision of inmate contained in sections 4, 10, 201–202, standard. payphone services, in particular, the 214, 276, 303, and 403 of the 5. Description of Projected Reporting, costs associated with providing inmate Communications Act of 1934, as Recordkeeping and Other Compliance calling services. The Commission amended, 47 U.S.C. 154, 160, 201–204, Requirements intends through this NPRM and 214, 276, 303, and 403, section 706 of subsequent action, to reduce costs if the Telecommunications Act of 1996, Any proposal we may adopt pursuant possible. and sections 1.1, 1.48, 1.411, 1.412, this NPRM may decrease existing 1.415, 1.419, and 1.1200–1.1216, of the reporting, recordkeeping or other 8. Federal Rules that May Duplicate, Commission’s rules, 47 CFR 1.1, 1.48, compliance requirements. As noted Overlap, or Conflict with the Proposed 1.411, 1.412, 1.415, 1.419, and 1.1200– above, carriers are currently subject to a Rules 1.1216. broad range of regulatory requirements None. that are generally intended to protect 3. Description and Estimate of the consumers from unjust and B. Filing Comments Number of Small Entities to Which the unreasonable rates, terms, and Pursuant to sections 1.415 and 1.419 Proposed Rules will Apply conditions and unreasonable of the Commission’s rules, interested The RFA directs agencies to provide discrimination in the provision of parties may file comments within 45 a description of and, where feasible, an communications services. The days after publication of this NPRM in estimate of the number of small entities Commission’s dominant carrier the Federal Register and may file reply that will be affected by the proposed regulation includes rate regulation and comments within 75 days after
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publication of this NPRM in the Federal headquarters is delivered to our Capitol of the substance of the presentations Register. All filings should refer to CC Heights facility for screening prior to and not merely a listing of the subjects Docket No. 96–128. Comments may be delivery at the Commission. discussed. More than a one or two filed using the Commission’s Electronic 3. Parties who choose to file by paper sentence description of the views and Comment Filing System (ECFS) or by should also submit their comments on arguments presented is generally filing paper copies. Comments filed diskette. These diskettes should be required. See 47 CFR 1.1206(b). Other through ECFS can be sent as an submitted to the Chief, Pricing Policy rules pertaining to oral and written ex electronic file via the Internet to VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00021 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Proposed Rules 17039 methods to minimize the impact of We seek to develop a record on specific 4.9 GHz spectrum. The FNPRM explores interference on the 4.9 GHz band from segmentation or channeling plans for a number of licensing options for mobile adjacent band U.S Navy operations, as use of the band. We also request use, such as state licensing, blanket well as ensuring that the band is comment on ways to minimize the licensing or unlicensed operations, the utilized in a manner that will not impact of interference from adjacent use of regional planning committees or interfere with adjacent band radio band U.S. Navy operations on the 4.9 band managers. astronomy operations. Finally, GHz band. Finally, we solicit E. Interference comments will aid the Commission with suggestions on how to utilize the band the implementation of technical in a manner that will not interfere with 6. The Commission seeks comment on standards for both fixed and mobile adjacent band radio astronomy its tentative conclusion that the low operations on the band. Our goal is to operations. power operations contemplated for the establish rules that will result in the band will not interfere with the Navy’s most efficient and innovative use of the A. Eligibility to Use the 4.9 GHz Band Cooperative Engagement Capability 4.9GHz band. 2. The Commission seeks comment on (CEC) system, which operates on the DATES: Written comments are due on or the criteria to use to determine band immediately below the 4.9 GHz before July 8, 2002 and reply comments eligibility to operate equipment within band. The Commission also seeks are due on or before August 7, 2002. the 4.9 GHz band. Specifically, the comment on the Navy’s plans for the CEC system in the band below the 4.9 ADDRESSES: Commission’s Acting Commission seeks comment on whether Secretary, William F. Caton, Office of to define eligibility to use the 4.9 GHz GHz band and the impact that the CEC the Secretary, Federal Communications band pursuant to the definition of operations will have on provision of Commission, 445 12th St., SW., public safety contained in Section 337 service in the 4.9 GHz band. Washington, DC 20554. Filings can be of the Communications Act (Act), or Additionally the Commission seeks sent first class by the U.S. Postal pursuant to the definition of public comment on the effect CEC operations Service, by an overnight courier or hand safety contained in Section 309(j)(2) of would have on any segmentation or and messenger-delivered. Hand and the Act, or both. Further, the channelization plans adopted for this message-delivered paper filings must be Commission seeks comment on band, and what steps public safety delivered to 236 Massachusetts Avenue, allowing commercial use in support of licensees in the 4.9 GHz band could take NE., Suite 110, Washington, DC 20002. public safety in this band, and whether to minimize the impact of CEC Overnight courier (other than U.S. commercial uses should be permitted on operations on their services. Postal Service Express Mail and Priority a secondary basis. Moreover, the F. Technical Standards for Mobile Mail) must be sent to 9300 East Commission seeks comment on its Equipment tentative conclusion to allow Federal Hampton Drive, Capitol Heights, MD 7. The Commission seeks comment on use of the spectrum, as well as whether 20743. whether to establish technical standards it should require sharing agreements FOR FURTHER INFORMATION CONTACT: for mobile equipment operating in the between public safety entities and Genevieve Augustin, Esq., 4.9 GHz band, and if so, what standards Federal users as a prerequisite to [email protected], or Roberto should be included in our Rules. The Federal use. Mussenden, Esq., [email protected], Commission also seeks comment on Policy and Rules Branch, Public Safety B. Fixed and Mobile Use of the 4.9 GHz other means by which we can craft our and Private Wireless Division, Wireless Band Rules to permit operational flexibility Telecommunications Bureau, (202) 418– 3. We seek comment on the while ensuring interoperability between 0680, or TTY (202) 418–7233. circumstances under which we should different agencies. Further the SUPPLEMENTARY INFORMATION: This is a permit fixed operations in the 4.9 GHz Commission seeks comment on whether summary of the Federal band. We seek information on whether the setting of performance standards Communications Commission’s Further fixed applications on the band would will delay the production of equipment Notice of Proposed Rule Making, FCC consist of the traditional point-to-point that will be operated on this band, and 02–47, adopted on February 14, 2002, microwave operations, more advanced if so, what we can do to prevent any and released on February 27, 2002. The point-to-multipoint services, or such delays. The Commission also seeks full text of this document is available for temporary fixed links. Furthermore, we comment on its analysis of the inspection and copying during normal specifically seek comment on whether technologies envisioned by the current business hours in the FCC Reference any proposed fixed operations would record. Center, Room CY–A257, 445 12th Street, interfere with the use of the emerging G. Technical Rules for Fixed Operations SW., Washington, DC 20554. The mobile technologies discussed herein. in the 4.9 GHz Band complete text may be purchased from We solicit suggestions on a name for the Commission’s copy contractor, 8. The Commission seeks comment on this new service, as well as comment on possible technical requirements for Qualex International, 445 12th Street, which section of our Rules is most SW., Room CY–B402, Washington, DC fixed operation on the band. The appropriate for regulation of this new Commission also seeks comment on 20554. The full text may also be service. downloaded at: www.fcc.gov. whether to make the emission mask Alternative formats are available to C. Channel Plan requirements for fixed microwave services in the 4.9 GHz band consistent persons with disabilities by contacting 4. The Commission seeks comment on with the emission mask requirements Brian Millin at (202) 418–7426 or TTY band plans for the 4.9 GHz spectrum. for fixed microwave services. (202) 418–7365. The Commission also seeks comment on 1. In our Further Notice of Proposed whether it should require coordination II. Procedural Matters Rulemaking (FNPRM), we seek of fixed and mobile services. comment on the establishment of A. Ex Parte Rules—Permit-But-Disclose licensing and service rules for the 4.9 D. Licensing Proceeding GHz band. Further, we solicit comment 5. The Commission seeks comment on 9. This is a permit-but-disclose notice on defining eligibility to use the band. the appropriate means of licensing the and comment rule making proceeding. VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00022 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 17040 Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Proposed Rules Ex parte presentations are permitted, the Secretary, Federal Communications adjacent band U.S. Navy operations; and except during the Sunshine Agenda Commission, 445 12th St., SW., Room ways to utilize the band in a manner period, provided they are disclosed as TW–A325, Washington, DC 20554. that will not interfere with adjacent provided in our Rules. 15. Parties who choose to file by band radio astronomy operations. paper should also submit their 18. Our objectives for the Notice are B. Regulatory Flexibility Act comments on diskette. These diskettes to: (1) Set the framework for the 10. The Regulatory Flexibility Act should be submitted to: Genevieve establishment of a new public safety (RFA) requires that an agency prepare a Augustin, Esq., Public Safety and radio service in the 4.9 GHz band; (2) regulatory flexibility analysis for notice Private Wireless Division, Wireless encourage flexible and efficient use of and comment rulemakings, unless the Telecommunications Bureau, 445 12th the 4.9 GHz spectrum; (3) encourage agency certifies that ‘‘the rule will not, St., SW., Room 3–A431, Washington, innovative applications in support of if promulgated, have a significant DC 20554. Such a submission should be public safety; and (4) improve access to economic impact on a substantial on a 3.5-inch diskette formatted in an communications and state of the art first number of small entities. Accordingly, IBM compatible format using Microsoft responder tools for entities engaged in we have prepared an Initial Regulatory Word 97 or compatible software. The public safety operations. The Flexibility Certification concerning the diskette should be accompanied by a Commission also seeks to ensure a impact on small entities of the policies cover letter and should be submitted in regulatory plan for the 4.9 GHz band and rules proposed by this FNPRM. The ‘‘read only’’ mode. The diskette should that will allow for the efficient licensing Initial Regulatory Flexibility be clearly labeled with the commenter’s and use of the band, and eliminate Certification is set forth below in name, proceeding (including the lead unnecessary regulatory burdens. Section III. docket number in this case, WT Docket B. Legal Basis No. 00–32), type of pleading (comment C. Paperwork Reduction Act or reply comment), date of submission, 19. The proposed action is authorized 11. This Notice does not contain and the name of the electronic file on under sections 1, 4(i), 7, 10, 201, 202, either a proposed or modified the diskette. The label should also 208, 214, 301, 303, 308, 309(j), and 310 information collection. include the following phrase ‘‘Disk of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 157, D. Comment Dates Copy—Not an Original.’’ Each diskette should contain only one party’s 160, 201, 202, 208, 214, 301, 303, 308, 12. Pursuant to §§ 1.415 and 1.419 of pleadings, preferably in a single 309(j), 310. our Rules, interested parties may file electronic file. In addition, commenters C. Description and Estimate of the comments on or before July 8, 2002 and should send diskette copies to the reply comments on or before August 7, Number of Small Entities to Which the Commission’s copy contractor, Qualex Proposed Rules Will Apply 2002. Comments may be filed using the International, Inc., 445 12th St., SW., Commission’s Electronic Filing System Room CY–B402, Washington, DC 20554. 20. The RFA directs agencies to (ECFS) or by filing paper copies. provide a description of, and where 13. Comments filed through the ECFS III. Initial Regulatory Flexibility feasible, an estimate of the number of can be sent as an electronic file via the Analysis for Notice of Proposed Rule small entities that may be affected by Internet to VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00023 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Proposed Rules 17041 85,006 governmental entities, we that they would not qualify as small entities. We seek comment on estimate that 81,600 (ninety-one businesses. significant alternatives commenters percent) are small entities. 25. We invite comment on this believe should be adopted in this 22. The proposed radio service may analysis. proceeding. affect users of public safety radio D. Description of Projected Reporting, services, the extent of which is not F. Federal Rules that May Duplicate, Recordkeeping, and Other Compliance defined in this proceeding. This service Overlap, or Conflict with the Proposed Requirements for Small Entities may also affect manufacturers of radio Rules communications equipment. An 26. We note that in this FNPRM, we None. analysis of the number of small propose a variety of licensing businesses that may be affected follows. approaches we could employ on this IV. Ordering Clauses We also note that according to SBA band, but formulate no tentative 29. Pursuant to sections 4(i), 303(r), data, there are approximately 4.44 conclusions on this matter. Possible and 403 of the Communications Act of million small businesses nationwide. requirements under consideration in 1934, as amended, 47 U.S.C. 154(i), 23. Public Safety Radio Services and this Further Notice include: 303(r), 403, this Further Notice of Governmental entities. As a general recordkeeping and reporting Proposed Rule Making is hereby matter, Public Safety Radio Services requirements, and/or third-party adopted. include police, fire, local government, consultation, if state licensing is 30. The Commission’s Consumer and forestry conservation, highway ultimately utilized; compliance with Government Affairs Bureau, Reference maintenance, and emergency medical part 101 of our Rules, in the event that Information Center, shall send a copy of services. Non-Federal governmental fixed operations are licensed on the 4.9 this Notice of Proposed Rule Making, entities, as well as private businesses, GHz band; compliance with part 90 of including the Regulatory Flexibility are potential licensees for these services our Rules, if mobile operations are Certification, to the Chief Counsel for in this proceeding. Neither the licensed individually; compliance with Advocacy of the Small Business Commission nor the SBA has developed part 27 of our Rules, if 4.9 GHz band Administration. a definition of small businesses directed operations are licensed pursuant Federal Communications Commission. specifically toward public service thereto; and compliance with part 15 of licensees. Therefore, the applicable our Rules, in the event that mobile William F. Caton, definition of small business is the operations on the 4.9 GHz band are Acting Secretary. definition under the SBA rules unlicensed. Applicants and licensees [FR Doc. 02–8483 Filed 4–8–02; 8:45 am] applicable to Cellular and other would possibly be required to follow BILLING CODE 6712–01–P Wireless Telecommunications. This current service rules for such provides that a small business is a approaches, if ultimately chosen. radiotelephone company employing no FEDERAL COMMUNICATIONS E. Steps Taken to Minimize the COMMISSION more than 1,500 persons. According to Significant Economic Impact on Small the Bureau of the Census, only twelve Entities, and Significant Alternatives radiotelephone firms from a total of 47 CFR Part 73 Considered 1,178 such firms which operated during [DA 02–749, MB Docket No. 02–75, RM– 1992 had 1,000 or more employees. 27. The RFA requires an agency to 10151] Therefore, even if all twelve of these describe any significant, specifically firms were public safety licensees, small business, alternatives that it has Digital Television Broadcast Service; nearly all would be small businesses considered in reaching its proposed Lynchburg, VA under the SBA’s definition, if approach, which may include the AGENCY: following four alternatives (among Federal Communications independently owned and operated. Commission. 24. Equipment Manufacturers. We others): ‘‘(1) The establishment of anticipate that at least six radio differing compliance or reporting ACTION: Proposed rule. equipment manufacturers will be requirements or timetables that take into SUMMARY: The Commission requests affected by our decisions in this account the resources available to small comments on a petition filed by WSET, proceeding. According to the Small entities; (2) the clarification, Inc., licensee of station WSET–TV, Business Administration’s regulations, a consolidation, or simplification of NTSC channel 13, Lynchburg, Virginia, Radio and Television Broadcasting and compliance and reporting requirements requesting the substitution of DTV Wireless Communications Equipment under the rule for such small entities; channel 34 for station WSET–TV Manufacturing businesses must have (3) the use of performance rather than assigned DTV channel 56. DTV Channel 750 or fewer employees in order to design standards; and (4) an exemption 34 can be allotted to Lynchburg, qualify as a small business concern. from coverage of the rule, or any part Virginia, in compliance with the Census Bureau data indicate that there thereof, for such small entities.’’ are 858 U.S. firms that manufacture 28. The possible regulatory burdens principle community coverage radio and television broadcasting and we have described above, such as requirements of Section 73.625(a) at communications equipment, and that recordkeeping, recording, and filing reference coordinates (37–18–52 N. and 778 of these firms have fewer than 750 requirements, if implemented, are 79–38–04 W.). As requested, we propose employees and would therefore be necessary in order to ensure that the to allot DTV Channel 34 to Lynchburg classified as small entities. We do not public safety operations benefit from the with a power of 660 and a height above have information that indicates how innovative new services described average terrain (HAAT) of 625 meters. many of the six radio equipment herein, in a prompt and efficient DATES: Comments must be filed on or manufacturers associated with this manner. We will continue to examine before May 30, 2002, and reply proceeding are among these 778 firms. alternatives in the future with the comments on or before June 14, 2002. Motorola and Ericsson, however, are objectives of eliminating unnecessary ADDRESSES: Federal Communications major, nationwide radio equipment regulations and minimizing any Commission, 445 12th Street, SW., manufacturers, and thus, we conclude significant economic impact on small Room TW–A325, Washington, DC VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00024 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 17042 Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Proposed Rules 20554. In addition to filing comments Qualex International, Portals II, 445 For the reasons discussed in the with the FCC, interested parties should 12th Street, SW., Room CY–B402, preamble, the Federal Communications serve the petitioner, or its counsel or Washington, DC, 20554, telephone 202– Commission proposes to amend 47 CFR consultant, as follows: Thomas P. Van 863–2893, facsimile 202–863–2898, or part 73 as follows: Wazer, Jennifer Tatel, Sidley, Austin, via-e-mail [email protected]. Brown & Wood, 1722 Eye Street, NW., Provisions of the Regulatory PART 73—RADIO, TELEVISION Washington, DC 20006 (Counsel for Flexibility Act of 1980 do not apply to BROADCAST SERVICES WSET, Inc.). this proceeding. 1. The authority citation for part 73 FOR FURTHER INFORMATION CONTACT: Members of the public should note Pam continues to read as follows: Blumenthal, Media Bureau, (202) 418– that from the time a Notice of Proposed 1600. Rule Making is issued until the matter Authority: 47 U.S.C. 154, 303, 334, and is no longer subject to Commission 336. SUPPLEMENTARY INFORMATION: This is a consideration or court review, all ex synopsis of the Commission’s Notice of parte contacts are prohibited in § 73.622 [Amended] Proposed Rule Making, MB Docket No. Commission proceedings, such as this 2. Section 73.622(b), the Table of 02–75, adopted April 1, 2002, and one, which involve channel allotments. Digital Television Allotments under released April 8, 2002. The full text of See 47 CFR 1.1204(b) for rules Virginia is amended by removing DTV this document is available for public governing permissible ex parte contacts. Channel 56 and adding DTV Channel 34 inspection and copying during regular For information regarding proper at Lynchburg. business hours in the FCC Reference filing procedures for comments, see 47 Federal Communications Commission. Information Center, Portals II, 445 12th CFR 1.415 and 1.420. Street, SW., Room CY–A257, Barbara A. Kreisman, Washington, DC, 20554. This document List of Subjects in 47 CFR Part 73 Chief, Video Division, Media Bureau. may also be purchased from the Digital television broadcasting, [FR Doc. 02–8497 Filed 4–8–02; 8:45 am] Commission’s duplicating contractor, Television. BILLING CODE 6712–01–P VerDate Mar<13>2002 10:53 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 E:\FR\FM\09APP1.SGM pfrm03 PsN: 09APP1 17043 Notices Federal Register Vol. 67, No. 68 Tuesday, April 9, 2002 This section of the FEDERAL REGISTER Federal Information Relay Service phone, mail, or e-mail when considered contains documents other than rules or (FIRS) at 1–800–877–8339 between 8 necessary and appropriate if the proposed rules that are applicable to the a.m. and 8 p.m., Eastern Standard Time, customers indicate that they desire this public. Notices of hearings and investigations, Monday through Friday to reach Ms. by telling us how to reach them. committee meetings, agency decisions and Hunter or Ms. Ball. Receiving positive comments reinforces rulings, delegations of authority, filing of petitions and applications and agency SUPPLEMENTARY INFORMATION: the incentive of employees to make the Forest Service a customer-driven statements of organization and functions are Description of Information Collection examples of documents appearing in this agency. section. Title: Customer Service Comment Estimate of Annual Burden: 4 Card. minutes. OMB Number: 0596–0146. Type of Respondents: Respondents DEPARTMENT OF AGRICULTURE Expiration Date of Approval: April 28, include anyone who visits or contacts 2002. one of the Forest Service offices, work Forest Service Type of Request: Extension with no sites, or visitor centers, either in person, revision. by telephone or on the Internet. This Information Collection; Customer Abstract: This information collection includes individuals and groups of Service Comment Card is necessary to monitor customer varying ages and abilities, U.S. citizens and citizens from other countries, who AGENCY: Forest Service, USDA. satisfaction with Forest Service visit or plan to visit National Forest ACTION: Notice; request for comment. customer services, information, procedures, and facilities and to provide System lands, for recreation or education purposes; special interest SUMMARY: In accordance with the a means to address customer Paperwork Reduction Act of 1995, the complaints, suggestions, and groups; local residents; and individuals Forest Service is seeking comments compliments. This information conducting business with the Forest from all interested individuals and collection complies with issuance of Service including, but not limited to, grazing permittees, minerals, oil and gas organizations on the extension of Executive Order 12862 on September permittees, land lessees, timber information collection for the 11, 1993, which directs Federal agencies customers, other forest products ‘‘Customer Service Comment Card,’’ a to change the way they do business, to customers, research scientists, special- tool used to monitor customer reform their management practices, to use customers, educators, librarians, satisfaction. provide service to the public that historians, writers, media contacts, matches or exceeds the best service DATES: Comments must be received in moviemakers, law enforcement officers, available in the private sector, and to writing on or before June 10, 2002 to be fire fighters, representatives of other establish and implement customer assured of consideration. Comments Federal, State, county, or local service standards. received after that date will be Government agencies, and foreign The Customer Service Card includes considered to the extent practicable. governments. the following statements that are to be ADDRESSES: Comments concerning this Estimated Annual Number of rated on a scale from 1 to 4, with 1 being Respondents: 15,000. notice should be addressed to Forest ‘‘Strongly Agree’’ and 4 being ‘‘Strongly Service, USDA, ATTN: Director, Office Estimated Annual Number of Disagree.’’ In addition, 5 indicates that Responses per Respondent: 1. of Communications, Mail Stop 1111, the statement is ‘‘Not Applicable.’’ 1400 Independence Avenue, SW., Estimated Total Annual Burden on 1. Service was prompt and courteous. Respondents: 1,000 hours per year. Washington, DC 20250–1111. 2. Information was what I needed. Comments also may be submitted via 2. Procedures were clear and simple. Comment is invited facsimile to (202) 205–0885 or by e-mail 3. Facilities were satisfactory and Comment is invited on: (1) Whether to: bhunter01.fs.fed.us. accessible. this collection of information is The public may inspect comments 4. Technology transfer/technical necessary for the stated purposes and received at the Office of assistance was effective. the proper performance of the functions Communication, Customer Service Customers can voluntarily mail the of the agency, including whether the Group, Yates Building, 2 CEN, 201 cards back to the Chief of the Forest information will have practical or Fourteenth Street, SW., Washington DC Service in Washington, DC, or complete scientific utility; (2) the accuracy of the during normal business hours. Visitors an online Comment Card form through agency’s estimate of the burden of the are encouraged to call ahead to (202) the Internet. The data are gathered, collection of information, including the 205–0979 to facilitate entry to the evaluated, and included in ad hoc validity of the methodology and building. reports. Also, the printed Customer assumptions used; (3) ways to enhance FOR FURTHER INFORMATION CONTACT: Service Comment Card and e-mail the quality, utility, and clarity of the Barbara Hunter, Office of messages are forwarded to the information to be collected; and (4) Communication, (202) 205–0979 or appropriate Forest Service personnel in ways to minimize the burden of the [email protected] or Mary Ann Ball, the respective field units where the collection of information on Forest Service Information Collection customers were served so that any respondents, including the use of Coordinator, at (703) 605–4572, or send complaints and suggestions may be used automated, electronic, mechanical, or an e-mail to [email protected]. to improve services and facilities. This other technological collection Individuals who use telecommunication gives Forest Service personnel an techniques or other forms of information devices for the deaf (TDD) may call the opportunity to respond to customers by technology. VerDate 11 All comments received in response to A field trip will be held on May 14 ACTION: Notice. this notice, including names and and is designed to supplement addresses when provided, will be a information related to tree-marking SUMMARY: The Rural Housing Service matter of public record. Comments will paint. This trip is open to any member (RHS) announces the availability of $19 be summarized and included in the of the public participating in the public million in national competitive grant submission for Office of Management meeting on May 15–16. However, funds to be administered in accordance and Budget approval. transportation is provided only for with this Notice, 7 U.S.C. 1926(a)(20), and the Community Facilities grant Dated: March 7, 2002 committee members. The main session of the meeting, program (7 CFR part 3570, subpart B) to Robert Lewis, Jr., develop essential community facilities Acting Chief, Forest Service. which is open to public attendance, will be held on May 15–16. in rural communities with extreme high [FR Doc. 02–8530 Filed 4–8–02; 8:45 am] unemployment and severe economic BILLING CODE 3410–11–P Closed Sessions depression. While certain segments of this DATES: Applications may be submitted DEPARTMENT OF AGRICULTURE meeting are open to the public, there at any time until funds are exhausted. will be two closed sessions during the (See Allocation of Funds and Selection Forest Service meeting. The first closed session is Process.) planned for approximately 9 to 11 a.m. ADDRESSES: Entities wishing to apply for National Tree-Marking Paint Committee on May 15. This session is reserved for assistance are encouraged to contact Meeting individual paint manufacturers to their local USDA Rural Development present products and information about AGENCY: Forest Service, USDA. office for guidance on the intake and tree-marking paint for consideration in ACTION: Notice of meeting. processing of preapplications. A listing future testing and use by the agency. of Rural Development State offices, SUMMARY: The National Tree-Marking Paint manufacturers also may provide addresses, telephone numbers, and a Paint Committee will meet in St. Louis, comments on tree-marking paint person to contact follows: Missouri, on May 14–16, 2002. The specifications or other requirements. Note: Telephone numbers listed are not purpose of the meeting is to discuss This portion of the meeting is open only toll-free. activities related to improvements in, to paint manufacturers, the Committee, concerns about, and the handling and and committee staff to ensure that trade Alabama State Office use of tree-marking paint by personnel secrets will not be disclosed to other Suite 601, Sterling Centre, 4121 of the Forest Service and the paint manufacturers or to the public. Carmichael Road Montgomery, AL Department of the Interior’s Bureau of Paint manufacturers wishing to make 36106–3683, 334–279–3400, James B. Land Management. presentations to the Tree-Marking Paint Harris DATES: The meeting will be held May Committee during the closed session Alaska State Office 14–16, 2002, from 8 a.m. to 5 p.m. should contact the Chairman at the telephone number listed under FOR ADDRESSES: The meeting will be held at 800 W. Evergreen, Suite 201, Palmer, FURTHER INFORMATION. The second the Marriott St. Louis Pavilion AK 99645–6539, 907–761–7705, Dean closed session is planned for Downtown, One Broadway, St. Louis, Stewart approximately 1 to 4 p.m. on May 16. Missouri. Persons who wish to file This session is reserved for Federal Arizona State Office written comments before or after the Government employees only. meeting must send written comments to Phoenix Corporate Center, 3003 North Bob Monk, Chairman, National Tree- Any person with special access needs Central Avenue, Suite 900, Phoenix, marking Paint Committee, Forest should contact the Chairman to make AZ 85012–2906, 602–280–8700, Service, USDA, San Dimas Technology those accommodations. Space for Leonard Gradillas individuals who are not members of the and Development Center, 444 East Arkansas State Office Bonita Avenue, San Dimas, California National Tree-Marking Paint Committee 91773, or electronically to is limited and will be available to the 700 W. Capitol Avenue, Room 3416 [email protected]. public on a first-come, first-served basis. Little Rock, AR 72201–3225, 501– Dated: March 28, 2002. 301–3200, Jesse G. Sharp FOR FURTHER INFORMATION: Bob Monk, Project Leader, San Dimas Technology Tom L. Thompson, California State Office Deputy Chief for National Forest System. and Develoment Center, Forest Service, 430 G Street, #4169, Davis, CA 95616– USDA, (909) 599–1267, extension 267 or [FR Doc. 02–8529 Filed 4–8–02; 8:45 am] 4169, 530–792–5800, Janice Waddell [email protected]. BILLING CODE 3410–11–M SUPPLEMENTARY INFORMATION: The Colorado State Office National Tree-Marking Paint Committee 655 Parfet Street, Room E100, DEPARTMENT OF AGRICULTURE comprises representatives from the Lakewood, CO 80215, 303–236–2801, Forest Service national headquarters, Rural Housing Service Leroy Cruz each of the nine Forest Service Regions, Delaware State Office* the Forest Products Laboratory, the Announcement of Funding to Develop Forest Service San Dimas Technology Essential Community Facilities in 4607 S. DuPont Highway, P.O. Box 400, and Development Center, and the Rural Communities for Eligible Public Camden, DE 19934–9998, 302–697– Bureau of Land Management. The Entities, Nonprofit Corporations, and 4300, James E. Waters General Services Administration and Tribal Governments with Extreme High Florida State Office** the National Institute for Occupational Unemployment and Severe Economic Safety and Health are ad hoc members Depression 4440 N.W. 25th Place, P.O. Box 147010, and provide technical advice to the Gainesville, FL 32614–7010, 352– committee. AGENCY: Rural Housing Service, USDA. 338–3400, Glenn W. Walden VerDate 11 Georgia State Office 65203, 573–876–0976, D. Clark South Carolina State Office Stephens Federal Building, 355 E. Thomas Strom Thurmond Federal Building, 835 Hancock Avenue, Athens, GA 30601– Montana State Office Assembly Street, Room 1007, 2768, 706–546–2162, Jerry Thomas Unit 1, Suite B, P.O. Box 850, 900 Columbia, SC 29102, 803–765–5163, Larry Floyd Hawaii State Office Technology Boulevard, Bozeman, MT Room 311, Federal Building, 154 59715, 406–585–2580, Deborah South Dakota State Office Waianuenue Avenue, Hilo, HI 96720, Chorlton Federal Building, Room 210, 200 Fourth 808–933–8380, Thao Khamoui Nebraska State Office Street SW., Huron, SD 57350, 605– 352–1100, Roger Hazuka Idaho State Office Federal Building, Room 152, 100 Centennial Mall N, Lincoln, NE 9173 W. Barnes Drive, Suite A1, Boise, Tennessee State Office 68508, 402–437–5551, Denise ID 83709, 208–378–5600, Dan Fraser Suite 300, 3322 West End Avenue, Brosius-Meeks Nashville, TN 37203–1084, 615–783– Illinois State Office Nevada State Office 1300, Keith Head 2118 Westpark Court, Suite A, 1390 South Curry Street, Carson City, Champaign, IL 61821, 217–403–6200, Texas State Office NV 89703–9910, 775–887–1222, Mike Gerald Townsend E. Holm Federal Building, Suite 102, 101 South Main, Temple, TX 76501, 254–742– Indiana State Office New Jersey State Office 9700, Eugene G. Pavlat 5975 Lakeside Boulevard, Indianapolis, Tarnsfield Plaza, Suite 22, 790 Utah State Office IN 46278, 317–290–3100, Gregg Delp WoodLane Road, Mt. Holly, NJ 08060, Wallace F. Bennett Federal Building, Iowa State Office 609–265–3600, Michael P. Kelsey 125 S. State Street, Rm. 4311, P.O. 873 Federal Building, 210 Walnut New Mexico State Office Box 11350, Salt Lake City, UT 84147– Street, Des Moines, IA 50309, 515– 6200 Jefferson Street NE, Room 255, 0350, 801–524–4320, Bonnie Carrig 284–4663, Dorman A. Otte Albuquerque, NM 87109, 505–761– Vermont State Office **** Kansas State Office 4950, Clyde F. Hudson, City Center, 3rd Floor, 89 Main Street, 1303 SW First American Place, Suite New York State Office Montpelier, VT 05602, 802–828–1600, 100, Topeka, KS 66604–0440, 785– The Galleries of Syracuse 441 S. Salina Rhonda Shippee 271–2700, Gary Smith Street, Suite 357, Syracuse, NY, Virginia State Office Kentucky State Office 13202–2541, 315–477–6400, Gail Giannotta Culpeper Building, Suite 238, 1606 Suite 200, 771 Corporate Drive, Santa Rosa Road, Richmond, VA Lexington, KY 40503, 859–224–7300, North Carolina State Office 23229, 804–287–1550, Carrie Schmidt Vernon C. Brown 4405 Bland Road, Suite 260, Raleigh, Washington State Office Louisiana State Office NC 27609, 919–873–2000, Phyllis Godbold 1835 Black Lake Blvd. SW., Suite B, 3727 Government Street, Alexandria, Olympia, WA 98512–5715, 360–704– LA 71302, 318–473–7920, Danny North Dakota State Office 7740, Sandi Boughton Magee Federal Building, Room 208, 220 East West Virginia State Office Maine State Office Rosser, P.O. Box 1737, Bismarck, ND, 58502–1737, 701–530–2037, Donald Federal Building, 75 High Street, Room 967 Illinois Avenue, Suite 4, P.O. Box Warren 320, Morgantown, WV 26505–7500, 405, Bangor, ME 04402–0405, 207– 304–284–4860, Dianne Crysler 990–9106, Alan Daigle Ohio State Office Federal Building, Room 507, 200 North Wisconsin State Office Massachusetts State Office*** High Street, Columbus, OH, 43215– 4949 Kirschling Court, Stevens Point, 451 West Street, Amherst, MA 01002, 2418, 614–255–2400, David Douglas WI 54481, 715–345–7600, Mark 413–253–4300, Daniel Beaudette Brodziski, Oklahoma State Office Michigan State Office 100 USDA, Suite 108, Stillwater, OK Wyoming State Office 3001 Coolidge Road, Suite 200, East 74074–2654, 405–742–1000, Rock W. 100 East B, Federal Building, Room Lansing, MI 48823, 517–324–5100, Davis 1005, P.O. Box 820, Casper, WY Philip H. Wolak Oregon State Office, 82602, 307–261–6300, Charles Huff Minnesota State Office * The Delaware State Office also 101 SW Main, Suite 1410, Portland, OR administers the Maryland program. 410 AgriBank Building, 375 Jackson 97204–3222, 503–414–3300, Jerry W. ** The Florida State Office also Street, St. Paul, MN 55101–1853, 651– Sheridan administers the Virgin Island program. 602–7800, James Maras Pennsylvania State Office *** The Massachusetts State Office also administers the Rhode Island and Mississippi State Office One Credit Union Place, Suite 330, Connecticut programs. Federal Building, Suite 831, 100 W. Harrisburg, PA 17110–2996, 717–237– **** The Vermont State Office also Capitol, Jackson, MS 39269, 601–965– 2299, Gary Rothrock administers the New Hampshire 4316 Darnella Smith-Murray Puerto Rico State Office program. Missouri State Office IBM Building, Suite 601, 654 Munos FOR FURTHER INFORMATION CONTACT: 601 Business Loop 70 West, Parkade Rivera Avenue, Hato Rey, PR, 00918– Joseph Ben-Israel, Community Center, Suite 235, Columbia, MO 6106, 787–766–5095, Pedro Gomez Programs, RHS, USDA, STOP 0787, VerDate 11 1400 Independence Ave. SW., 19.5 percent as mandated by 7 U.S.C. will remain eligible to compete for the Washington, DC 20250–0787, 1926(a)(20)(B). next round of funding. Telephone (202) 720–1490, Facsimile To be considered for the first window, Definition of Not Employed Rate (202) 690–0471, E-mail: all preapplications along with [email protected]. This is the percentage of individuals supporting documentation satisfactory over the age of 18 who reside within the SUPPLEMENTARY INFORMATION: to the Agency must be received by the community and who are ready, willing, Rural Development State or designated Paperwork Reduction Act and able to be employed but are unable field office by close of business May 3, The reporting requirements contained to find employment, as determined by 2002. To be considered for the second in this notice have been approved by the the Department of Labor of the State in window, all preapplications must be Office of Management and Budget which the community is located. received by the Rural Development State or designated field office by close (OMB) and have been assigned OMB Applicant Eligibility for Local Dial-Up of business August 16, 2002. control number 0575–0173 in Internet Access accordance with the Paperwork Notice of Invitation To Submit Reduction Act (44 U.S.C. 3501 et seq.). The Agriculture, Rural Development, Food and Drug Administration, and Complete Application Authorizing Legislation and Related Agencies Appropriations Act, All preapplications selected for Regulations 2002 expanded eligibility for the funding consideration will be notified This program is authorized under Economic Impact Initiative to provide by the State or field office by issuing section 306(a) of the Consolidated Farm local dial-up Internet access or Form AD–622, ‘‘Notice of and Rural Development Act. RHS will broadband service where it does not Preapplication Review Action.’’ At that administer these funds using the same currently exist. Under this provision, time, the proposed recipient will be regulations that govern its Community the Agency may make grants to State invited to submit a complete Facilities grant program. Program agencies for use by regulatory application, along with instructions administration, eligibility, processing, commissions in States with rural related to the agreed upon award and servicing requirements that govern communities without local dial-up amount, and asked to schedule an the Community Facilities grant program Internet access or local broadband application conference to discuss items may be found under 7 CFR part 3570, service. The State Agencies will needed for formal application and to subpart B. establish a competitive, technologically further clarify issues related to the neutral grant program to project. Background telecommunications carriers or cable Final Approval and Funding Process Under the FY 2002 appropriation, operators that establish common carrier Congress appropriated $19 million for a facilities and services that, in the Final approval is subject to the Community Facilities grant program for commission’s determination, will result availability of funds; the submission by rural communities with extreme in the long-term availability of the applicant of a formal, complete unemployment and severe economic affordable broadband services that are application and related materials that depression, hereafter referred to as the used for high speed Internet access for meet the program requirements and Economic Impact Initiative. These funds these communities. responsibilities of the grantee are in addition to the Community (contained in 7 CFR part 3570, subpart Facilities grant program’s regular Allocation of Funds B); the letter of conditions; and the grant allocation of competitive grant funds. All Economic Impact Initiative funds agreement. Those preapplications that The Community Facilities grant will remain in the National Office do not have sufficient priority necessary program, authorized by Congress in reserve for funding consideration for FY to receive funding consideration for FY 1996, is used in conjunction with the 2002. Project selections will be on a 2002 will be notified, in writing, by the existing direct and guaranteed loan national competitive basis. There will Agency’s State or designated field office. programs for the development of be two windows of opportunity to Dated: April 3, 2002. essential community facilities for public compete for grant funding. It is Arthur A. Garcia, use in rural areas. Funding is intended anticipated, the first round of funding Administrator, Rural Housing Service. to complement rather than compete selections will be made after May 10, [FR Doc. 02–8527 Filed 4–8–02; 8:45 am] with other credit sources. Grants are 2002. The second round will be held BILLING CODE 3410–XV–P made available to public entities, such after August 23, 2002. as municipalities, counties, and special- Selection Process service districts, as well as to eligible COMMISSION ON CIVIL RIGHTS nonprofit corporations and tribal Once a determination has been made governments. Grants are targeted to by the State Office that an applicant is Agenda and Notice of Public Meeting communities with the smallest eligible, the preapplication is evaluated of the District of Columbia, Maryland populations and lowest incomes. competitively and points awarded as and Virginia Advisory Committees Communities with lower population specified in the project selection and income levels receive a greater priorities contained in 7 CFR part 3570, Notice is hereby given, pursuant to percentage of the Federal contribution, subpart B. The State Director or the provisions of the rules and between 15 to 75 percent of the cost of designee will then forward the request regulations of the U.S. Commission on developing the facility. to the National Office to compete for Civil Rights that a meeting of the funding consideration. Projects will District of Columbia, Maryland and Additional Eligibility Requirements then be rated, ranked, and selections Virginia Advisory Committees to the In addition to those requirements made in order of priority. Each proposal Commission will convene at 9:30 a.m. contained in 7 CFR part 3570, subpart will be judged on its own merit. Unless and recess at 6 p.m. on April 24, 2002; B, the essential community facility must withdrawn by the applicant, projects will reconvene at 9:30 a.m. and adjourn be located in a rural community where not selected for funding consideration at 6 p.m. on April 25, 2002, at the the ‘‘not employed rate’’ is greater than for the first round of funding selections Mason District Government Center, VerDate 11 6507 Columbia Pike, Annandale, COMMISSION ON CIVIL RIGHTS Regional Office at least ten (10) working Virginia 22003. The subcommittees, also days before the scheduled date of the known as the Inter-SAC Committee, will Agenda and Notice of Public Meeting meeting. hold a community forum on civil rights of the Minnesota Advisory Committee The meeting will be conducted focusing on civil rights concerns of pursuant to the provisions of the rules Notice is hereby given, pursuant to Arab, Muslim, Sikh and South Asian and regulations of the Commission. the provisions of the rules and communities in the Washington regulations of the U.S. Commission on Dated at Washington, DC, March 29, 2002. metropolitan area in the aftermath of 9/ Civil Rights, that a meeting of the Ivy L. Davis, 11 tragedies. Minnesota Advisory Committee to the Chief, Regional Programs Coordination Unit. Persons desiring additional Commission will be held from 9 a.m. to [FR Doc. 02–8469 Filed 4–8–02; 8:45 am] information, or planning a presentation 6 p.m. on Wednesday, April 24, 2002, BILLING CODE 6335–01–P to the Committee, should contact Ki- and from 9 a.m. to 2 p.m. on Thursday, Taek Chun, Director of the Eastern April 25, 2002, at the Embassy Suites Regional Office, 202–376–7533 (TDD Hotel, 425 S. 7th Street, 5th Floor, DEPARTMENT OF COMMERCE 202–376–8116). Hearing-impaired Universal Room, Minneapolis, persons who will attend the meeting Minnesota 55415. The purpose of the Submission for OMB Review; and require the services of a sign meeting is to gather information on the Comment Request language interpreter should contact the Minneapolis-St. Paul news media Regional Office at least ten (10) working coverage of minority communities. The Department of Commerce (DOC) days before the scheduled date of the Persons desiring additional has submitted to the Office of meeting. information, or planning a presentation Management and Budget (OMB) for emergency clearance the following The meeting will be conducted to the Committee, should contact Constance M. Davis, Director of the proposal for collection of information pursuant to the provisions of the rules under provisions of the Paperwork and regulations of the Commission. Midwestern Regional Office, 312–353– 8311 (TDD 312–353–8362). Hearing- Reduction Act (44 U.S.C. Chapter 35). Dated at Washington, DC, April 2, 2002. impaired persons who will attend the Agency: Bureau of Export Ivy L. Davis, meeting and require the services of a Administration (BXA). Title: BXA Program Questionnaire. Chief, Regional Programs Coordination Unit. sign language interpreter should contact [FR Doc. 02–8466 Filed 4–8–02; 8:45 am] Form Number: None. the Regional Office at least ten (10) OMB Approval Number: None. BILLING CODE 6335–01–P working days before the scheduled date Type of Review: Emergency. of the meeting. Burden Hours: 667. The meeting will be conducted Number of Respondents: 4,000. COMMISSION ON CIVIL RIGHTS pursuant to the provisions of the rules Average Time Per Response: 10 and regulations of the Commission. Agenda and Notice of Public Meeting minutes. of the Iowa Advisory Committee Dated at Washington, DC, March 29, 2002. Needs and Uses: This questionnaire Ivy L. Davis, will be used by participants at the Notice is hereby given, pursuant to Chief, Regional Programs Coordination Unit. Update West conference, visitors to BXA’s web site, and perhaps by the provisions of the rules and [FR Doc. 02–8468 Filed 4–8–02; 8:45 am] attendees at future BXA conferences. regulations of the U.S. Commission on BILLING CODE 6335–01–P Civil Rights, that a meeting of the Iowa The responses to these questions Advisory Committee to the Commission provide useful and practical information will convene at 10 a.m. and adjourn at COMMISSION ON CIVIL RIGHTS that BXA can use to determine that it is 12 p.m. on May 1, 2002, at the Holiday providing a quality program and gives Inn Airport, 611 Fleur Drive, Des Agenda and Notice of Public Meeting BXA information useful to making Moines, Iowa 50321. The purpose of the of the Utah Advisory Committee recommended improvements. It also meeting is to plan future activities. shows attendees that BXA cares about Notice is hereby given, pursuant to their experience and values their Persons desiring additional the provisions of the rules and viewpoint. information, or planning a presentation regulations of the U.S. Commission on Affected Public: Individuals, business to the Committee, should contact Civil Rights, that a meeting of the Utah or other for-profit organizations. Melvin L. Jenkins, Director of the Advisory Committee to the Commission Respondent’s Obligation: Voluntary. Central Regional Office, 913–551–1400 will convene at 5:30 p.m. and adjourn OMB Desk Officer: David Rostker, (TDD 913–551–1414). Hearing-impaired at 8 p.m. on Tuesday, April 23, 2002, at (202) 395–3897. persons who will attend the meeting the Horizonte School, 1234 S. Main Copies of the above information and require the services of a sign Street, Salt Lake City, UT 84101. The collection proposal can be obtained by language interpreter should contact the purpose of the meeting is to hold new calling or writing Madeleine Clayton, Regional Office at least ten (10) working member orientation and discuss current Departmental Paperwork Clearance days before the scheduled date of the projects and civil rights issues in the Officer, (202) 482–3129, Department of meeting. state. Commerce, Room 6608, 14th and The meeting will be conducted Persons desiring additional Constitution Avenue, NW, Washington, pursuant to the provisions of the rules information, or planning a presentation DC 20230. and regulations of the Commission. to the Committee, should contact, John Written comments and Dulles, Director of the Rocky Mountain recommendations for the proposed Dated at Washington, DC, April 3, 2002. Regional Office, 303–866–1040 (TDD information collection should be sent Ivy L. Davis, 303–866–1049). Hearing-impaired within 5 days of publication of this Chief, Regional Programs Coordination Unit. persons who will attend the meeting notice to David Rostker, OMB Desk [FR Doc. 02–8467 Filed 4–8–02; 8:45 am] and require the services of a sign Officer, Room 10202, New Executive BILLING CODE 6335–01–P language interpreter should contact the Office Building, Washington, DC 20503. VerDate 11 Dated: April 4, 2002. 1934, as amended (19 U.S.C. 81a–81u), Zone 59, has requested authority on Gwellnar Banks, the Foreign-Trade Zones Board (the behalf of Kawasaki Motors Management Analyst, Office of the Chief Board) adopts the following Order: Manufacturing, U.S.A. (Inc.) (KMM), Information Officer. Whereas, Board Order 745 (60 FR operator of FTZ 59A, at the KMM motor [FR Doc. 02–8550 Filed 4–8–02; 8:45 am] 30517, 6–9–95) granted authority on vehicle and industrial automation BILLING CODE 3510–33–P behalf of Kawasaki Motors products manufacturing facility in Manufacturing Corp., U.S.A. (KMM) to Lincoln, Nebraska, to expand the scope manufacture multi-axis industrial robots of FTZ authority to include new DEPARTMENT OF COMMERCE with six or more axes of motion under manufacturing capacity under FTZ FTZ procedures for a limited time procedures and requesting authority to Foreign-Trade Zones Board period (expires April 1, 2002), subject to expand the boundaries of Subzone 59A [Order No. 1217] extension; (FTZ Doc. 33–99, filed 6–25–99); Whereas, KMM, operator of Subzone Whereas, notice inviting public Approval for Expansion of Subzone 59A, has requested authority to extend comment was given in the Federal 124D LOOP LLC/LOCAP LLC (Crude its manufacturing authority for multi- Register (64 FR 37496, 7–12–99); Oil Pipeline and Storage System) axis industrial robots on a permanent Whereas, the Board adopts the LaFourche and St. James Parishes basis; findings and recommendations of the Whereas, notice inviting public examiner’s report, and finds that the Pursuant to its authority under the comment was given in the Federal requirements of the FTZ Act and the Foreign-Trade Zones Act of June 18, Register (64 FR 25477, 5–12–99); Board’s regulations are satisfied, and 1934, as amended (19 U.S.C. 81a-81u), Whereas, the Board adopts the that approval of the application is in the the Foreign-Trade Zones Board (the findings and recommendations of the public interest; Board) adopts the following Order: examiner’s report, and finds that the Now therefore, the Board hereby Whereas, the South Louisiana Port requirements of the FTZ Act and the approves the request, subject to the FTZ Commission, grantee of FTZ 124, has Board’s regulations are satisfied, and Act and the Board’s regulations, requested authority on behalf of LOOP LLC/ that approval of the request would be in including Section 400.28. LOCAP LLC (LOOP), to include an additional the public interest; Signed at Washington, DC, this 29th day of site (Site 1, Parcel E) within Subzone 124D Now therefore, the Board hereby March, 2002. at the LOOP crude oil pipeline and storage approves the request subject to the FTZ system (FTZ Docket 24–2001, filed 6–14–01); Faryar Shirzad, Whereas, notice inviting public comment Act and the Board’s regulations, Assistant Secretary of Commerce for Import has been given in the Federal Register (66 FR including Section 400.28, and subject to Administration, Alternate Chairman, Foreign- 33947, 6/26/01); the restriction that the scope of Trade Zones Board. Whereas, the Board adopts the findings authority is limited to the manufacture Dennis Puccinelli, and recommendations of the examiner’s of multi-axis industrial robots having Executive Secretary. report, and finds that the requirements of the six or more axes of motion. FTZ Act and Board’s regulations are satisfied, [FR Doc. 02–8566 Filed 4–8–02; 8:45 am] Signed at Washington, DC, this 29th day of and that the proposal is in the public interest; BILLING CODE 3510–DS–P March, 2002. Now, therefore, the Board hereby orders: The application to include an additional Faryar Shirzad, site within Subzone 124D at the crude oil Assistant Secretary of Commerce, for Import DEPARTMENT OF COMMERCE pipeline and storage system of LOOP LLC/ Administration, Alternate Chairman, Foreign- LOCAP LLC, is approved, subject to the FTZ Trade Zones Board. Foreign-Trade Zones Board Act and the Board’s regulations, including Dennis Puccinelli, [Order No. 1214] Section 400.28. Executive Secretary. Signed at Washington, DC, this 29th day of [FR Doc. 02–8565 Filed 4–8–02; 8:45 am] Expansion of Foreign-Trade Zone 110, March 2002. BILLING CODE 3510–DS–P Albuquerque, NM Faryar Shirzad, Assistant Secretary for Import Pursuant to its authority under the Administration, Alternate Chairman, Foreign- DEPARTMENT OF COMMERCE Foreign-Trade Zones Act of June 18, Trade Zones Board. 1934, as amended (19 U.S.C. 81a–81u), Dennis Puccinelli, Foreign-Trade Zones Board the Foreign-Trade Zones Board (the Board) adopts the following Order: Executive Secretary. [Order No. 1220] [FR Doc. 02–8563 Filed 4–8–02; 8:45 am] Whereas, the City of Albuquerque, New Mexico, grantee of Foreign-Trade BILLING CODE 3510–DS–P Approval for Expanded Manufacturing Authority and Subzone Expansion Zone 110, submitted an application to (Motorcycles, Personal Watercraft, All- the Board for authority to expand and DEPARTMENT OF COMMERCE Terrain Vehicles, Utility Work Trucks, relocate FTZ 110 from its current Industrial Robots); Foreign-Trade location in Albuquerque, to a site (62 Foreign-Trade Zones Board Subzone 59A; Kawasaki Motors acres) at the 2,300-acre Albuquerque International Sunport airport complex, [Order No. 1219] Manufacturing Corp., U.S.A.; Lincoln, Nebraska within the Albuquerque Customs port of Approval for Extension of Authority of entry area (FTZ Docket 28–2001; filed 6/ Board Order 745; Foreign-Trade Pursuant to its authority under the 28/01); Subzone 59A; Kawasaki Motors Foreign-Trade Zones Act of June 18, Whereas, notice inviting public Manufacturing Corp., U.S.A. (Multi-Axis 1934, as amended (19 U.S.C. 81a–81u), comment was given in the Federal Industrial Robots); Lincoln, Nebraska the Foreign-Trade Zones Board (the Register (66 FR 35593, 7/6/01) and the Board) adopts the following Order: application has been processed Pursuant to its authority under the Whereas, the Lincoln Foreign Trade pursuant to the FTZ Act and the Board’s Foreign-Trade Zones Act of June 18, Zone, Inc., grantee of Foreign-Trade regulations; and, VerDate 11 Whereas, the Board adopts the FTZ Act and the Board’s regulations are Whereas, the Board adopts the findings and recommendations of the satisfied, and that approval of the application findings and recommendations of the examiner’s report, and finds that the is in the public interest; examiner’s report, and finds that the Now, therefore, the Board hereby grants requirements of the FTZ Act and the requirements of the FTZ Act and the authority for subzone status at the chemicals Board’s regulations are satisfied, and products manufacturing and warehousing Board’s regulations are satisfied, and that the proposal is in the public facilities of E.I. duPont de Nemours and that approval of the application is in the interest; Company, Inc., located in Circleville, Ohio public interest; Now, therefore, the Board hereby (Subzone 138F), at the location described in Now, therefore, the Board hereby orders: the application, and subject to the FTZ Act grants authority for subzone status at the The application to expand FTZ 110 is and the Board’s regulations, including pharmaceutical product manufacturing approved, subject to the Act and the § 400.28. plant of Schering-Plough Products, Board’s regulations, including Section Signed at Washington, DC, this 29th day of L.L.C., located in Las Piedras, Puerto 400.28. March 2002. Rico, (Subzone 7G), at the location Signed at Washington, DC, this 29th day of Faryar Shirzad, described in the application, subject to March 2002. Assistant Secretary of Commerce for Import the FTZ Act and the Board’s regulations, Faryar Shirzad, Administration, Alternate Chairman, Foreign- including § 400.28. Trade Zones Board. Assistant Secretary of Commerce for Import Signed at Washington, DC, this 29th day of Administration, Alternate Chairman, Foreign- Dennis Puccinelli, March 2002. Trade Zones Board. Executive Secretary. Faryar Shirzad, Dennis Puccinelli, [FR Doc. 02–8562 Filed 4–8–02; 8:45 am] Assistant Secretary of Commerce for Import Administration, Alternate Chairman, Foreign- BILLING CODE 3510–DS–P Executive Secretary. Trade Zones Board. [FR Doc. 02–8561 Filed 4–8–02; 8:45 am] Dennis Puccinelli, BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE Executive Secretary. [FR Doc. 02–8564 Filed 4–8–02; 8:45 am] Foreign-Trade Zones Board DEPARTMENT OF COMMERCE BILLING CODE 3510–DS–P [Order No. 1218] Foreign-Trade Zones Board Grant of Authority for Subzone Status; DEPARTMENT OF COMMERCE [Order No. 1215] Schering-Plough Products, L.L.C. Foreign-Trade Zones Board Grant of Authority for Subzone Status; Manufacturing Plant (Pharmaceutical E.I. Dupont De Nemours and Company, Products), Las Piedras, PR [Order No. 1213] Inc. (Chemicals Products), Circleville, Pursuant to its authority under the Expansion of Foreign-Trade Zone 39, OH Foreign-Trade Zones Act of June 18, Dallas/Fort Worth, TX Pursuant to its authority under the 1934, as amended (19 U.S.C. 81a–81u), Pursuant to its authority under the Foreign-Trade Zones Act, of June 18, the Foreign-Trade Zones Board (the Foreign-Trade Zones Act of June 18, 1934, as amended (19 U.S.C. 81a–81u), Board) adopts the following Order: Whereas, the Foreign-Trade Zones Act 1934, as amended (19 U.S.C. 81a-81u), the Foreign-Trade Zones Board (the provides for ‘‘ * * * the establishment the Foreign-Trade Zones Board (the Board) adopts the following Order: * * * of foreign-trade zones in ports of Board) adopts the following Order: Whereas, the Foreign-Trade Zones Act entry of the United States, to expedite Whereas, the Dallas/Fort Worth provides for ‘‘* * * the establishment * * * and encourage foreign commerce, and International Airport Board, grantee of of foreign-trade zones in ports of entry of the for other purposes,’’ and authorizes the Foreign-Trade Zone 39, submitted an United States, to expedite and encourage Foreign-Trade Zones Board to grant to application to the Board for authority to foreign commerce, and for other purposes,’’ and authorizes the Foreign-Trade Zones qualified corporations the privilege of expand FTZ 39 to include two new sites Board to grant to qualified corporations the establishing foreign-trade zones in or at the Meacham Airport complex (Site privilege of establishing foreign-trade zones adjacent to U.S. Customs ports of entry; 5) in Fort Worth, and at the Redbird in or adjacent to U.S. Customs ports of entry; Whereas, the Board’s regulations (15 Airport complex (Site 6) in Dallas, Whereas, the Board’s regulations (15 CFR CFR part 400) provide for the within the Dallas/Fort Worth Customs part 400) provide for the establishment of establishment of special-purpose port of entry area (FTZ Docket 26–2001; special-purpose subzones when existing zone subzones when existing zone facilities filed 6/20/01); facilities cannot serve the specific use cannot serve the specific use involved; Whereas, notice inviting public involved, and when the activity results in a and when the activity results in a comment was given in the Federal significant public benefit and is in the public interest; significant public benefit and is in the Register (66 FR 34150, 6/27/01) and the Whereas, the Rickenbacker Port Authority, public interest; application has been processed grantee of Foreign-Trade Zone 138, has made Whereas, the Puerto Rico Industrial pursuant to the FTZ Act and the Board’s application to the Board for authority to Development Corporation, grantee of regulations; and, establish special-purpose subzone status at Foreign-Trade Zone 7, has made Whereas, the Board adopts the the chemical products manufacturing and application to the Board for authority to findings and recommendations of the warehousing facilities of E.I. duPont de establish special-purpose subzone status examiner’s report, and finds that the Nemours and Company, Inc., located in at the pharmaceutical product requirements of the FTZ Act and the Circleville, Ohio (FTZ Docket 17–2001, filed manufacturing plant of Schering-Plough Board’s regulations are satisfied, and 4/23/01); Whereas, notice inviting public comment Products, L.L.C., located in Las Piedras, that the proposal is in the public was given in the Federal Register (66 FR Puerto Rico (FTZ Docket 4–2002, filed interest; 21739, 5/1/01); and, January 10, 2002); Now, therefore, the Board hereby Whereas, the Board adopts the findings Whereas, notice inviting public orders: and recommendations of the examiner’s comment has been given in the Federal The application to expand FTZ 39 is report, and finds that the requirements of the Register (67 FR 2401, 1/17/02); and, approved, subject to the Act and the VerDate 11 Board’s regulations, including Section (2) Environmental Demonstration Entrepreneurship Program are to 400.28, and further subject to the Projects—approximately six grants or support: Board’s standard 2,000-acre activation cooperative agreements, each up to 1. Educational Opportunities. To limit for the overall zone project. $300,000 total for up to three years to prepare students with the necessary Signed at Washington, DC, this 29th day of support the engagement of MSI faculties academic training, technical skills and March 2002. and students in field demonstration experiences that will enable them to Faryar Shirzad, projects focused on applying pursue careers, entrepreneurship opportunities and advanced academic Assistant Secretary of Commerce for Import environmentally sound methods and Administration, Alternate Chairman, Foreign- technologies to address NOAA related study in environmental fields related to Trade Zones Board. environmental issues. NOAA’s mission. 2. Capacity Building. To develop or [FR Doc. 02–8560 Filed 4–8–02; 8:45 am] DATES: A Letter of Intent to aid NOAA enhance the capacity of environmental BILLING CODE 3510–DS–P in planning the review of proposals is related academic programs at MSIs in requested by April 30, 2002 but is not order to ensure they are effective required. Proposals must be received by DEPARTMENT OF COMMERCE pipelines through which students and 5:00 p.m. (Eastern Daylight Savings faculty can gain the necessary Time) on May 30, 2002 (See Section VI. National Oceanic and Atmospheric experience to make environmentally Instructions for Application: Timetable). Administration and economically sound decisions. ADDRESSES: Proposals should be 3. Partnerships. To facilitate or [Docket No. 020325068–2068–01] submitted to: Jewel M. Griffin-Linzey, strengthen MSI partnerships, where RIN 0648–ZB17 EPP/MSI Environmental appropriate, with NOAA programs and Entrepreneurship Program, National facilities, community colleges and Request for Proposals for FY 2002— Oceanic and Atmospheric universities, industry, governments NOAA Educational Partnership Administration, Room 11877, SSMC3 (state, local, commonwealth, territorial Program With Minority Serving (R/SG), 1315 East-West Highway, Silver and tribal), and organizations (public, Institutions: Environmental Spring, MD 20910. nonprofit, or private) that foster Entrepreneurship Program FOR FURTHER INFORMATION CONTACT: cooperative education and training activities for students and faculties. AGENCY: Office of Oceanic and Jewel M. Griffin-Linzey, NOAA EPP/ 4. Community Economic Atmospheric Research (OAR), National MSI: Entrepreneurship Program, Development. To support MSIs and Oceanic and Atmospheric National Oceanic and Atmospheric partners in preparing students with the Administration (NOAA). Commerce. Administration, SSMC3 (R/SG), 1315 necessary knowledge, skills, tools and East-West Highway, Silver Spring, MD ACTION: Notice of request for proposals. technology that may be applied outside 20910. Tel. (301) 713–1495; e-mail: the classroom to ensure SUMMARY: The Office of Oceanic and [email protected] Atmospheric Research (OAR) in the environmentally sustainable and SUPPLEMENTARY INFORMATION: National Oceanic and Atmospheric economically viable local communities. Administration (NOAA), United States I. Program Authority The goal is to foster environmental Department of Commerce is soliciting entrepreneurship opportunities that proposals for the NOAA Educational Authority: 15 U.S.C. 1540, 49 U.S.C. empower students to become stewards Partnership Program with Minority 44720, 33 U.S.C. 883a and 883d, 33 U.S.C. of natural resources and the Serving Institutions (EPP/MSI): 1442, 16 U.S.C. 1854(e), 16 U.S.C. 661, 16 environment and to transfer knowledge Environmental Entrepreneurship U.S.C. 753(a), 16 U.S.C. 1451 et seq., 16 gained to address environmental U.S.C. 1431, and Executive Orders 12876, Program. The goal of the program is to problems of importance in their local 12900 and 13021. Catalog of Federal communities. strengthen the capacity of Minority Assistance Number: 11.481—Educational Serving Institutions to foster student Partnership Program with Minority Serving Rationale careers, entrepreneurship opportunities Institutions. and advanced academic study in NOAA The recruitment of minorities, related sciences. II. Program Description particularly underrepresented minorities, in the fields of science and In Fiscal Year 2002, NOAA plans to Background make available a total of $3,000,000 to engineering, lags behind expectations. support the EPP/MSI Environmental NOAA provides science, technology, According to the most recent data Entrepreneurship Program. The program and services to describe and predict compiled by the National Science will provide funds on a competitive changes in the Earth’s environment, and Foundation (NFS), ‘‘Women, Minorities basis to support projects at eligible conserve and manage wisely the and Persons with Disabilities in Science Minority Serving Institutions, for up to Nation’s coastal and marine resources to and Engineering: 2000,’’ the percentage three years duration, in the following ensure sustainable economic of minority scientists and engineers in two categories: opportunities. The agency has made a the workforce ranges from 0.3 percent (1) Program Development and commitment to expand and strengthen for American Indians to about 3.0 Enhancement—approximately six grants its partnerships with Minority Serving percent each for African-Americans and or cooperative agreements, each up to Institutions that will serve as a catalyst Hispanics. The quality and nature of $250,000 total for up to three years, to to meet its principal goals of academic experiences at each point of support the development and environmental stewardship, assessment, the educational pipeline are crucial to enhancement of outreach, education, and prediction. In accordance with bringing more minorities into applied research and training programs NOAA’s overall mission, and with the environmental science and engineering that will strengthen MSIs and their policy of NOAA and the U.S. fields. Bachelors, Masters and Doctoral partners capacity to foster student Department of Commerce to foster degrees are the underpinnings of careers, entrepreneurship opportunities environmental education, research and environmental science career and advanced academic study in NOAA economic sustainability, the purposes of achievement and employment. At both related sciences. the NOAA EPP/MSI Environmental the undergraduate and graduate levels, VerDate 11 Hispanics, African Americans, and NOAA-related environmental fields. linkages and collaborations with Native Americans complete fewer Activities funded under this element partners such as other universities, degrees, relative to their demographic may include, but are not limited to: community colleges, research composition in the population, than atmospheric, environmental and institutions, industry, government and majority ethnic groups. At the Bachelors oceanic science courses and curriculum nongovernmental agencies, and other level, NSF data show that African enhancement; practical learning organizations (public, nonprofit, or Americans received about 7.4 percent of experiences for students such as, hands- private). Partnerships should facilitate the Bachelors degrees in science and on training and applied research; and the entry of MSI students into careers engineering in 1996, Hispanics received other activities designed to foster such as, entrepreneurs, scientists, 6.4 percent, and American Indians/ student careers, entrepreneurship resource managers, and community Alaskan Natives receive 0.6 percent. At opportunities and advanced academic leaders in environmental fields related the Master’s level, African Americans study related to NOAA’s mission. to NOAA’s mission. While partnerships receive about 5.0 percent of the science (2) Environmental Demonstration are encouraged, where appropriate. and engineering degrees, Hispanics Projects—approximately six grants or There is no requirement for a partner or about 4.0 percent, and American cooperative agreements, each up to a requirement for the applicant to Indians 0.4 percent. In FY 1998, MSIs $300,000 total for up to three years, to provide matching funds. NOAA retains received only 5.8 percent of Department support the engagement of MSI faculty the right to allocate funds differently of Commerce grants to institutions of and students in demonstration projects than indicated above if the number of higher education. that apply environmentally sound proposals received is not balanced methods and technologies to address across these two categories, or the NOAA EPP/MSI Environmental NOAA related environmental issues. Entrepreneurship Program proposal quality does not warrant the Field demonstration projects should stated allocation. In such cases, funds The goal of the NOAA EPP/MSI encourage partnerships that enable may be shifted between the two funding Environmental Entrepreneurship students to address challenging categories. Program is to strengthen the capacity of environmental issues such as, Minority Serving Institutions to foster enhancing and restoring coastal and Proposals student careers, entrepreneurship estuarine habitats, preventing marine Proposals must be submitted by an opportunities, and advanced academic pollution, reducing coastal hazards, eligible MSI (see Section III. Eligibility) study in NOAA-related sciences. assessing marine protected areas, and are expected to have a rigorous Proposals should be firmly grounded protecting coral reefs, reducing the work plan, a strong rationale, and in ‘‘environmental fields’’ related to spread of invasive species, restoring clearly identified and achievable goals. NOAA’s mission. The term fisheries and fisheries habitat, Proposals should emphasize innovative ‘‘environmental fields’’ is defined as developing and expanding aquaculture, approaches to encouraging, preparing, those environmental, natural sciences planning community waterfront and graduating MSI students trained in (i.e., biology, earth sciences), physical revitalization, mitigating and assessing environmental fields and related and social sciences (i.e., economics, impacts of weather and climate professional career fields. Projects anthropology, geography, and history), variability, improving the prediction of should strive for multiple-year engineering, professional and technical weather and climate phenomena, or participation by students and include fields that are relevant to NOAA’s employing remotely sensed data and effective use of role models and mission which is to ‘‘describe and information systems to support mentors. A plan for evaluating the predict changes in the Earth’s environmental monitoring and outcome of the project should be environment, and conserve and manage prediction. The intent is to involve included. wisely the Nation’s coastal and marine students in collaborative field projects resources.’’ (See http://www.noaa.gov/) that will empower them to pursue III. Eligibility Proposals should identify careers, entrepreneurship opportunities Minority Serving Institutions eligible mechanisms to be employed that and advanced academic study, and to submit proposals include institutions enhance MSIs capacity to foster student promote environmental sustainability of higher education identified by the opportunities, interest in, and pursuit of and economic viability in their local Department of Education as: careers, entrepreneurship and advanced communities. Projects should (where (i) Historically black Colleges and study in NOAA-related sciences. appropriate) involve students with Universities, Proposals will be accepted that academic training across the broad array (ii) Hispanic-Serving Institutions, address one of the following categories: of environmental fields needed to (iii) Tribal Colleges and Universities, (1) Program Development and implement field projects. Engaging on the most recent ‘‘2001 United States Enhancement—approximately six grants students in applied research to Department of Education Accredited or cooperative agreements, each up to understand the nature and extent of Post-Secondary Minority Institutions’’ $250,000 total for up to three years to environmental degradation within list: http://www.ed.gov/offices/ocr/ support the development and communities and to test and monitor minorityinst.pdf enhancement of effective outreach, methods for preventing, controlling, and IV. Evaluation Criteria education, applied research and training reducing the degradation of natural programs at eligible MSIs directly environments is encouraged. The evaluation criteria for proposals related to NOAA’s mission. Developing submitted for support under the NOAA and enhancing outreach, education, Partnerships EPP/MSI Environmental applied research and training For proposals submitted in the Entrepreneurship Program are weighted capabilities at MSIs is intended to Program, applicants should build on as follows: expand opportunities for students to existing expertise of academic and (1) Technical and Educational Merit develop the technical skills, training, applied research programs, as (40 percent): The degree to which the and experiences needed to pursue appropriate. Innovative approaches to activity will advance or transfer careers, entrepreneurship opportunities issues are sought that take maximum knowledge and understanding of and advanced academic study in advantage of the synergies, strong environmental fields, education, or VerDate 11 professional fields as they relate to type of financial assistance award. The assistance award for which you are NOAA’s mission; the qualifications of award will be a grant (e.g., whereby no applying. The Principal Investigator and the applicant (individual or team) to substantial involvement is anticipated institutional representative should be conduct the project, including the between DOC and the recipient during identified by full name, title, ability to involve individuals from the the project performance) or cooperative organization, telephone number, e-mail MSI’s student population successfully agreement award that requires and mailing address. The total amount in the project; the degree to which the substantial involvement (e.g., of Federal funds being requested should activity explores creative and original collaboration, participation, or be listed for each budget period. concepts; the overall design and intervention by DOC in the management (2) Abstract: It is critical that the organization of the planned activity; the of the project). abstract accurately describe the essential strength of the proposed partnerships, if elements of the project being proposed. any, to help meet the goals of the VI. Instructions for Application The abstract should include: 1. Title: project; and the sufficiency of resources Timetable Use the exact title as it appears in the for the plan of work. rest of the application. 2. Investigators: (2) Impact of Proposed Project (60 April 30, 2002—Letters of Intent: To List the names and affiliations of each percent): The contributions the project aid NOAA in planning the review of investigator who will significantly will make to enhancing the capability of proposals, potential Principal contribute to the project. Start with the the MSI to bring education, applied Investigators are strongly encouraged to Principal Investigator. 3. Funding research and hands-on training submit an optional Letter of Intent by request for each year of the project as opportunities to its student and faculty April 30, 2002. Letters of Intent should well as total funding requested. 4. populations in the environmental and be e-mailed (no attachments) to jewel. Project Period: Start and completion professional fields related to NOAA’s [email protected]. Information dates. Proposals should request a start mission; the benefit accruing to a faculty contained should include a brief date of October 1, 2002. 5. Objectives, member and the institution from description of the scope of the work, the Methodology, and Rationale: This participation in the NOAA EPP/MSI: parties involved, and an estimated should include a concise statement of Environmental Entrepreneurship budget. The Letters of Intent should not the objectives of the project, the Program; the degree to which the exceed one page. scientific or educational methodology to proposed activity develops mechanisms May 30, 2002—Proposals are due no be used, and the rationale for the work that will broaden and sustain the later than 5 p.m. (Eastern Daylight proposed. capacity of MSIs to prepare students in Savings Time), May 30, 2002. (See (3) Project Description NOAA related environmental fields; the Section VII. How to submit for further (a) Introduction/Background/ extent to which the proposed activity details.) Justification: What is the problem or will enhance and improve outreach, June 2002—Successful applicants can opportunity being addressed and what education, training, and applied expect to be notified by the end of June is its scientific, technical, educational, research at MSIs; and the adequacy of 2002. Successful applicants may be or socioeconomic importance to the the plan for evaluating the outcome of asked to provide revised narratives and/ region or nation? the project. For environmental or budgets that would be due before the (b) Technical Plan: What are the goals, demonstration projects, the degree to end of June 2002. objectives, and anticipated approach of which the project is expected to October 1, 2002—Funds will be the proposed project? While a detailed prevent, control, and reduce awarded through a grant or cooperative work plan is not expected, the proposal degradation to habitats will be agreement with an expected start date of should present evidence that there has considered. October 1, 2002. been thoughtful consideration of the Proposed Guidelines approach to the problem under study. If V. Selection Procedures a partner is involved, what capabilities An independent peer review panel All proposals should be typewritten does the partner possess that will comprised of a broad representation of on 81⁄2 x 11 paper with at least a 10- benefit the project, faculty member and experts in the science and MSI point font and may not exceed 20 pages. students? academic community will conduct the Tables and visual materials, including (c) Output/Anticipated Benefits: What review of the proposals. The panel charts, graphs, maps, photographs and measures will be used to evaluate the members will rank proposals in other pictorial presentations are outcome of the proposed project? Upon accordance with the above evaluation included in the page limitation; completion of the project, what are the criteria (Section IV). The panel members literature citations are not included in anticipated benefits to the MSI, its will provide individual evaluations on the page limitation. All information students, and the environmental proposals, but there will be no needed for review of the proposal community? consensus recommendation. The panel should be included in the main text; no (d) Literature Cited: Should be rankings and evaluations will be appendices are permitted. The following included here, but does not count considered by NOAA may also consider information should be included: against the page limit. programmatic or geographic balance and (1) Signed title page: The title page (4) Budget and Budget Justification: budget availability in the final selection should be signed by the Principal Form SF424A Budget Information Non- of proposals, hence, awards may not Investigator and the institutional Construction Programs and budget necessarily be made to the panel’s representative and should clearly justification narrative are required. highest-scored proposal. Unsuccessful identify the program area being There should be an annual budget for applications will be notified and addressed by starting the project title each year of the project as well as a provided with feedback that can assist with ‘‘NOAA EPP/MSI: Environmental cumulative budget for the entire project. applicants develop improved proposals Entrepreneurship Program’’ followed by Subcontracts should have a separate in the future. Successful applications either ‘‘Program Development and budget. Each annual budget should may be asked to modify objectives, work Enhancement’’ or ‘‘Environmental include a separate budget justification plans, budget levels, or project duration Demonstration Project,’’ depending page that itemizes all budget items in prior to final approval of an appropriate upon the particular type of financial sufficient detail to enable reviewers to VerDate 11 evaluate the appropriateness of the following explanations are hereby sufficient proposal copies for the full funding requested. (Please see the provided: process. NOAA budget guidelines at http:// (i) Non-Procurement Debarment and ∼ Proposals must be received by 5 p.m. www.rdc.noaa.gov/ grants/ Suspension. Prospective participants (as (Eastern Daylight Savings Time) on May BUDGTGUD.PDF). defined at 15 CFR Part 26, Section 105) 30, 2002. The address to send proposals (5) Current and Pending Support: are subject to 15 CFR Part 26, ‘‘Non- to is: Jewel M. Griffin-Linzey, NOAA Applicants must provide information on Procurement Debarment and EPP/MSI: Environmental all their current and pending Federal Suspension’’ and the related section of Entrepreneurship Program, National support for ongoing projects and the certification form prescribed above Oceanic and Atmospheric proposal, including potential applies; Administration, Room 11837, SSMC3 subsequent funding in the case of (ii) Drug-Free Workplace. Grantees (as (R/SG), 1315 East-West Highway, Silver continuing grants. The proposed project defined at 15 CFR Part 26, Section 605) Spring, MD 20910. Facsimile and all other projects or activities using are subject to 15 CFR Part 26, Subpart transmissions and electronic mail Federal assistance and requiring a F, ‘‘Government-wide Requirements for submission of proposals will not be portion of time of the principal Drug-Free Workplace (Grants)’’ and the accepted. investigator or other senior personnel related section of the certification form should be included. The relationship prescribed above applies; VIII. Other Requirements between the proposed project and these (iii) Anti-Lobbying. Persons (as other projects should be described, and The Department of Commerce Pre- defined at 15 CFR Part 28, Section 105) Award Notification Requirements for the number of person-months per year are subject to the lobbying provisions of to be devoted to the projects must be Grants and Cooperative Agreement 31 U.S.C. 1352, ‘‘Limitation on use of contained in the Federal Register notice stated. appropriated funds to influence certain (6) Vitae (two pages maximum per of October 1, 2001 (66 FR 49917) are Federal contracting and financial investigator). applicable to this solicitation. However, (7) Letters of commitment from transactions,’’ and the lobbying section please note that the Department of partnering organizations (if applicable). of the certification form prescribed Commerce will not implement the Letters of commitment from partners above applies to applications/bids for requirements of Executive Order 13202 must be included as an attachment to grants, cooperative agreements, and (66 FR 49921), pursuant to guidance the application. The letters from contracts for more than $100,000, and issued by the Office of Management and partnering organizations should loans and loan guarantees for more than Budget in light of a court opinion which describe their commitment, identify key $150,000; and found that the Executive Order was not participants, and state briefly their role (iv) Anti-Lobbying Disclosures. Any legally authorized. See Building and in the project. applicant that has paid or will pay for Construction Trades Department v. (8) Standard Application Forms: lobbying using any funds must submit Allbaugh, 172 F. Supp. 2d 138 (D.D.C. Proposals submitted in response to this an SF–LLL, ‘‘Disclosure of Lobbying 2001). This decision is currently on solicitation must be complete and Activities,’’ as required under 15 CFR appeal. When the case has been finally submitted in accordance with Part 28, Appendix B. resolved, the Department will provide instructions in the standard NOAA (c) Lower Tier Certifications. further information on implementation Grants Application package. Applicants Recipients shall require applicants/ of Executive Order 13202. may obtain all required application bidders for sub grants, contracts, forms through the NOAA internet site subcontracts, or other lower tier covered For awards receiving funding for the http:/www.rdc.noaa.gov/∼grants/pdf or transactions at any tier under the award collection or production of geospatial from Ms. Arlene Simpson Porter, NOAA to submit, if applicable, a completed data (e.g., GIS data layers), the recipient Grants Management Division, (301) Form CD–512, ‘‘Certifications Regarding will comply to the maximum extent 713–0962 ext. 152, Debarment, Suspension, Ineligibility practicable with E.O. 12906, [email protected]. and Voluntary Exclusion-Lower Tier Coordinating Geographic Data (a) Standard Form 424, Application Covered Transactions and Lobbying’’ Acquisition and Access, The National for Federal Assistance;SF424A Budget and disclosure form, SF–LLL, Spatial Data Infrastructure, 59 Fed., Reg. Information Non-Construction ‘‘Disclosure of Lobbying Activities.’’ 17671 (April 11, 1994). The award Programs; SF424B Assurances Non- ORM CD–512 is intended for the use of recipient shall document all new Construction, (Rev 4–88). Please note recipients and should not be transmitted geospatial data collected or produced that both the Principal Investigator and to the Department of Commerce (DOC). using the standard development by the an administrative contract should be SF–LLL submitted by any tier recipient Federal Geographic Data Center, and identified in Section 5 of the SF424 or or sub recipient should be submitted to make that standardized documentation Section 10, applications should enter DOC in accordance with the electronically accessible. The standard ‘‘11.481’’ for the CFDA Number and instructions contained in the award can be found at the following Internet ‘‘NOAA Educational Partnership document. website: (http://www.fgdc.gov/ Program with Minority Serving standards/standards/html). VII. How To Submit Institutions’’ for the title. The Form Classification must contain the original signature of an Only three copies of the Federally authorized representative of the required forms are needed. Although Prior notice and an opportunity for applying institution. investigators are not required to submit public comments are not required by the (b) Primary Applicant Certifications. more than three copies of the proposal, Administrative Procedure Act or any All primary applicants must submit a the normal review process utilizes 12 other law for this notice concerning completed Form CD–511, copies. If investigators wish all grants, benefits, and contracts, 5 USC ‘‘Certifications Regarding Debarment, reviewers to receive color, unusually 553 (a)(2). Therefore, this rule is not Suspension and Other Responsibility sized (other than 8.5 × 11″), or otherwise subject to the analytical requirements of Matters; Drug-Free Workplace unusual materials submitted as part of the Regulatory Flexibility Act, 5 USC Requirements and Lobbying,’’and the the proposal, they should submit 601 et. seq. VerDate 11 This action has been determined to be Amendment 10 alternatives and impact 2002. See SUPPLEMENTARY INFORMATION not significant for purposes of E.O. analyses. The Advisory Panel meeting for specific dates and times. 12866. will begin by selecting a chair and vice- ADDRESSES: The meetings will be held This notice contains collection of chair, followed by the joint meeting in Peabody, MA and Newport News, information requirements subject to the with the PDT. The Council will hold a VA. See SUPPLEMENTARY INFORMATION for Paperwork Reduction Act. Standard follow-up meeting after a few weeks for specific locations. Forms 424, 424A, 424B and SF–LLL the Advisory Panel to develop FOR FURTHER INFORMATION CONTACT: Paul have been approved by OMB under the recommendations for preferred and non- J. Howard, Executive Director, New respective control numbers 0348–0043, preferred alternatives. England Fishery Management Council, 0348–0044, 0348–0040, and 0348–0046. Although non-emergency issues not 978–465–0492. Requests for special Notwithstanding any other provision of contained in this agenda may come accommodations should be addressed to the law, no person is required to before this group for discussion, those the New England Fishery Management respond to, nor shall any person be issues may not be the subject of formal Council, 50 Water Street, Mill 2, subject to a penalty for failure to comply action during this meeting. Action will Newburyport, MA 01950. with, a collection of information subject be restricted to those issues specifically SUPPLEMENTARY INFORMATION: to the requirements of the Paperwork listed in this notice and any issues Reduction Act, unless that collection of arising after publication of this notice Meeting Dates, Times, Locations, and information displays a currently valid that require emergency action under Agendas OMB Control Number. section 305(c) of the Magnuson-Stevens Friday, April 26, 2002, at 9:30 a.m.— Dated: April 4, 2002. Fishery Conservation and Management Recreational Advisory Panel Meeting Louisa Koch, Act, provided the public has been Location: Holiday Inn, One Newbury notified of the Council’s intent to take Deputy Assistant Administrator, NOAA Street, Route 1, Peabody, MA 01960; Research. final action to address the emergency. telephone: 978–535–4600. [FR Doc. 02–8554 Filed 4–8–02; 8:45 am] Special Accommodations This will be the first meeting of the BILLING CODE 3510–KD–M Recreational Fishing Advisory Panel. This meeting is physically accessible After selecting a chair, panel members to people with disabilities. Requests for will review the role of Council advisors. DEPARTMENT OF COMMERCE sign language interpretation or other They will then develop auxiliary aids should be directed to Paul recommendations for the Council with National Oceanic and Atmospheric J. Howard (see ADDRESSES) at least 5 respect to the general strategy and Administration days prior to the meeting date. overall policy issues facing recreational [I.D. 040402A] Dated: April 4, 2002. (including party/charter) fishermen in Richard W. Surdi, fisheries managed by the New England New England Fishery Management Acting Director, Office of Sustainable Fishery Management Council. The Panel Council; Public Meetings Fisheries, National Marine Fisheries Service. will also discuss the ongoing [FR Doc. 02–8555 Filed 4–8–02; 8:45 am] development of Amendment 13 to the AGENCY: National Marine Fisheries BILLING CODE 3510–22–S Northeast Multispecies Fishery Service (NMFS), National Oceanic and Management Plan (FMP), and may Atmospheric Administration (NOAA), develop preliminary recommendations Commerce. DEPARTMENT OF COMMERCE for recreational management measures. ACTION: Notice of public meeting. They will consider these suggested National Oceanic and Atmospheric measures and will develop a SUMMARY: The New England Fishery Administration Management Council (Council) is recommendation that will be reviewed scheduling a public meeting of its [I.D. 040402B] by the Council at a later date. After Scallop Advisory Panel and Plan Council approval, the measures will be Development Team (PDT) in April, New England Fishery Management analyzed and included in a Draft 2002. Recommendations from the Council; Public Meetings Supplemental Environmental Impact Committee will be brought to the full Statement. AGENCY: National Marine Fisheries Monday, April 29, 2002, at 10 a.m. Council for formal consideration and Service (NMFS), National Oceanic and action, if appropriate. and Tuesday, April 30, 2002, at 8:30 Atmospheric Administration (NOAA), a.m.—Monkfish Oversight Committee DATES: The meeting will be held on Commerce. Meeting. Thursday, April 25, 2002, at 10:00 a.m. ACTION: Notice of public meetings. Location: Omni Newport News Hotel, ADDRESSES: The meeting will be held at 1000 Omni Boulevard, Newport News, SUMMARY: the Sheraton Inn Providence Airport, The New England Fishery VA 23606; telephone: 757–873–6664. 1850 Post Road, Warwick, RI 02886; Management Council (Council) is The Committee will continue to telephone: 401–738–4000. scheduling a public meeting of its develop its recommendations to the FOR FURTHER INFORMATION CONTACT: Paul Recreational Advisory Panel, Monkfish New England and Mid-Atlantic J. Howard, Executive Director, New Oversight and Groundfish Oversight Councils for management alternatives to England Fishery Management Council Committees in April 2002, to consider be analyzed in the Amendment 2 Draft 978–465–0492. Requests for special actions affecting New England fisheries Supplemental Environmental Impact accommodations should be addressed to in the exclusive economic zone (EEZ). Statement. Alternatives designed to the New England Fishery Management Recommendations from these groups achieve the approved goals and Council, 50 Water Street, Newburyport, will be brought to the full Council for objectives include, but are not limited MA 01950. formal consideration and action, if to: permit qualification criteria for SUPPLEMENTARY INFORMATION: The appropriate. vessels fishing south of 38N; Advisory Panel will meet with the PDT DATES: The meetings will be held management program for a deepwater to review and discuss the Draft between April 26, 2002, and April 30, directed fishery in the southern fisheries VerDate 11 management area; separation of that require emergency action under written copy of their remarks for monkfish days-at-sea (DAS) from section 305(c) of the Magnuson-Stevens inclusion in the record. multispecies and sea scallop DAS Fishery Conservation and Management To be ensured of consideration, programs, including counting of Act, provided the public has been written comments must be received on monkfish DAS as 24–hour days; notified of the Council’s intent to take or before May 16, 2002. measures to minimize impacts of the final action to address the emergency. Any interested governmental entity or fishery on endangered sea turtles; non-profit organization should contact measures to minimize bycatch in Special Accommodations the USPTO on or before May 24, 2002, directed in non-directed fisheries These meetings are physically to indicate a desire to acquire the paper including mesh size and other gear accessible to people with disabilities. patent and trademark registration requirements; an exemption program for Requests for sign language collections to be removed from the vessels fishing for monkfish outside of interpretation orother auxiliary aids USPTO’s public search facilities. the EEZ (in the Northwest Atlantic should be directed to Paul J. Howard ADDRESSES: The public hearing will be Fisheries Organization Regulated Area); (see ADDRESSES) at least 5 days prior to held in the Patent Theater located on alternative areas for essential fish the meeting dates. the second floor of Crystal Park 2, Room habitat (EFH) designation and measures Dated: April 4, 2002. 200, 2121 Crystal Drive, Arlington, VA. to minimize impacts of the fishery on Richard W. Surdi, Any request to speak at the public EFH; measures to improve data hearing must be submitted by electronic collection and research on monkfish, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service. mail message over the Internet to paper- including mechanisms for funding [FR Doc. 02–8556 Filed 4–8–02; 8:45 am] [email protected] or by facsimile to cooperative research programs. (703) 308–7792, marked to the attention BILLING CODE 3510–22–S Tuesday, April 30, 2002, at 9:30 of Ronald Hack, Deputy Chief a.m.—Groundfish Oversight Committee Information Officer for Information Meeting Technology Services. Comments should Location: Holiday Inn, One Newbury DEPARTMENT OF COMMERCE be sent by electronic mail message over Street, Route 1, Peabody, MA 01960; Patent and Trademark Office the Internet addressed to: paper- telephone: 978–535–4600. The Committee will continue [email protected]. Comments may also development of Amendment 13 to the RIN 0651–AB34 be submitted by mail addressed to: Northeast Multispecies FMP. Under Secretary of Commerce for Amendment 13 will end overfishing and Proposed Plan for an Electronic Public Intellectual Property and Director of the establish rebuilding schedules for Search Facility United States Patent and Trademark overfished stocks. At a meeting on Office, Washington, D.C. 20231, marked AGENCY: Patent and Trademark Office, to the attention of Ronald Hack, Deputy February 27, 2002, the New England Commerce. Council decided to develop groundfish Chief Information Officer for ACTION: management measures for five broad Notice of public hearing and Information Technology Services, or by areas and one user group: Inshore Gulf request for comments on the proposed facsimile to (703) 308–7792. Although of Maine, offshore Gulf of Maine, plan for an electronic public search comments may be submitted by mail or eastern Georges Bank, western Georges facility. facsimile, the USPTO prefers to receive Bank, Southern New England/Mid comments by electronic mail message SUMMARY: The United States Patent and over the Internet. The USPTO also Atlantic, and recreational/charter/party. Trademark Office (USPTO) is proposing This meeting will focus on recreational prefers that the comments be submitted a plan to eliminate the paper patent and as machine-readable submissions (including party/charter) fishing for trademark registration collections from groundfish in the Northeast Region of provided as unformatted text (e.g., its public search facilities and to ASCII or plain text), or as formatted text the National Marine Fisheries Service. transition to electronic patent and Interested parties will be consulted to in Microsoft Word (Macintosh, DOS or trademark information collections. The Windows versions) or WordPerfect identify management measures that will USPTO has determined that paper achieve specific biological, economic, (Macintosh, DOS or Windows versions) patent and trademark registration and social objectives identified by the format. If submitted by mail, machine- collections are no longer needed for Council. Such measures may include, readable submissions may be provided public reference because of the but are not limited to, trip or bag limits, on a 3 1/2-inch floppy disk formatted availability of mature and reliable changes to the minimum sizes, year- for use in either a Macintosh or MSDOS- electronic search systems in its public round or seasonal closed areas, or gear based computer, and must be search facilities. The USPTO is seeking changes. The Committee will consider accompanied by a paper copy. public comment on issues related to this these suggested measures and will Any governmental entity or non-profit proposed plan. The USPTO is also develop a recommendation that will be organization interested in acquiring the seeking input on whether any reviewed by the Council at a later date. paper patent and trademark registration governmental entity or non-profit After Council approval, the measures collections to be removed from the organization is interested in acquiring will be analyzed and included in a Draft USPTO’s public search facilities should the paper patent and trademark Supplemental Environmental Impact contact Ronald Hack, Deputy Chief registration collections to be removed Statement. Information Officer for Information Although non-emergency issues not from the USPTO’s public search Technology Services by facsimile contained in this agenda may come facilities. marked ‘‘ATTN PAPER COLLECTIONS’’ before this group for discussion, those DATES: A public hearing will be held on at (703) 308–7792. issues may not be the subject of formal May 16, 2002, starting at 9:30 a.m. and FOR FURTHER INFORMATION CONTACT: action during this meeting. Action will ending no later than 5 p.m. Those Ronald Hack by telephone at (703) 305– be restricted to those issues specifically wishing to speak must request an 9095, by facsimile at (703) 308–7792, by listed in this notice and any issues opportunity to do so no later than April electronic mail at arising after publication of this notice 30, 2002. Speakers should provide a [email protected]; to Martha VerDate 11 Sneed by telephone at (703) 308–5558, these documents in paper or microfilm. significantly higher demand. In fiscal by facsimile at (703) 306–2662, by See Public Law 106–113, 113 Stat. 1501, year 2001, online system hours used by electronic mail at 1501A–589 (1999). Section 4804(d)(2) of the public in USPTO’s public search [email protected]; or by mail the AIPA, however, provides that the facilities totaled 90,990 hours, an addressed to the Under Secretary of USPTO shall not: increase of 36,357 hours over the Commerce for Intellectual Property and cease to maintain, for use by the public, previous fiscal year. Director of the United States Patent and paper or microform collections of United Therefore, consistent with the AIPA, Trademark Office, Washington, DC States patents, foreign patent documents, and this is the USPTO’s proposed plan for 20231, marked to the attention of United States trademark registrations, except an electronic public search facility. To Ronald Hack, Deputy Chief Information pursuant to notice and opportunity for public accomplish a transition to electronic Officer for Information Technology comment and except that the Director shall resources, the USPTO proposes to Services. first submit a report to the Committees on the remove the two paper collections of Judiciary of the Senate and the House of search files currently available in the SUPPLEMENTARY INFORMATION: Representatives detailing such plan, The USPTO on-campus public search USPTO proposes a transition to including a description of the mechanisms in place to ensure the integrity of such facilities. One collection consists of U.S. electronic patent and trademark patent copies arranged by technology in information collections in its on-campus collections and the data contained therein, as well as to ensure prompt public access to the accordance with the U.S. Patent public search facilities in Crystal City, most current available information, and Classification System. The other Arlington, Virginia, by eliminating the certifying that the implementation of such collection consists of U.S. trademark classified paper patents and trademark plan will not negatively impact the public. registration copies arranged by registrations from the Patent Search See Public Law 106–113, 113 Stat. at components specific to the registration. Room located in Crystal Plaza 3/4, 2021 1501A–590. II. Background South Clark Place, and the Trademark Section 41(i)(2) of Title 35, U.S.C., Search Library located in the South also provides that: The Public Search Facilities of the Tower Building, 2900 Crystal Drive. The USPTO serve as the on-campus facilities USPTO has determined that these The Director shall provide for the full deployment of the automated search systems for the public to access United States collections are no longer needed for of the Patent and Trademark Office so that patent and trademark information public reference because of the such systems are available for use by the collections, and obtain training on and availability of mature and reliable public, and shall assure full access by the assistance with using these collections. replacement in-house electronic search public to, and dissemination of, patent and All industrialized countries provide systems in its public search facilities. trademark information, using a variety of similar facilities or functionality at or The USPTO has devoted significant automated methods, including electronic through their respective national resources to the successful development bulletin boards and remote access by users to intellectual property offices. At the of electronic search systems now widely mass storage and retrieval systems. USPTO Public Search Facilities, patent used throughout the USPTO public The USPTO has been actively engaged and trademark information is provided search facilities. They provide in a program to automate access to U.S. to the public in a number of formats equivalent functionality to the paper patents and to U.S. trademark including the online examiner search files and superior storage, maintenance registrations for a number of years. The systems, paper search files in classified and efficiency features. The paper first automated search systems were and numeric sets, and multiple formats classified files are incomplete by nature publicly deployed in 1985 for U.S. of source documents and additional of the format. There may be missing or trademarks and 1989 for U.S. patents data made available for a wide variety misfiled documents, potentially and have been upgraded and enhanced of research purposes. The public search impacting search results which rely to the extent that they now meet or facilities for patents and trademarks are only on the paper classified files. surpass the U.S. paper collections in physically separate. Replacement of paper collections completeness and timeliness of newly The Patent Search Facilities consist of provides the USPTO the ability to added material, and provide equivalent the Patent Search Room (PSR) where migrate away from reliance on paper- or better functionality in search strategy. there are multiple formats of patent data based resources in its public search Patent examiners and trademark including paper files and automated facilities and focus its limited resources examining attorneys have used these systems; the Patent Search and Image on increased support of the electronic systems daily since their inception. As Retrieval Facility (PSIRF), which is a resources. a result, the USPTO has had feedback center for all electronic patent search on the operation of these systems and and retrieval activities; and the Patent I. Introduction knows that the systems perform to the Assignment Search Room (PASR), Section 41(i)(1) of Title 35, United task and are user friendly. A selected which contains microfilm of ownership States Code (U.S.C.), requires the inventory of publicly available USPTO deed assignment, card files and USPTO to maintain for use by the searchable databases is included in the automated search systems. The Patent public collections of United States Appendix. Search Facilities provide public users patents, foreign patent documents, and These replacement electronic search access to classified paper files, numeric United States trademark registrations systems now provide the USPTO the microfilm files, CD–ROM search arranged to permit search for and ability to migrate away from reliance on collections, assignment systems, and the retrieval of information. See 35 U.S.C. paper-based resources in its public examiners’ automated search systems, 41(i)(1). Section 4804(d)(1) of the search facilities and focus its limited Examiner Automated Search Tool American Inventors Protection Act of resources on increased support of the (EAST) and Web-based Examiner Search 1999 (AIPA) amended 35 U.S.C. 41(i)(1) electronic resources. The use of Tool (WEST). Numbers of public users to allow the USPTO to maintain an electronic systems has increased by in these facilities have been tracked electronic collection of these public searchers to such a degree that since October 1999. Highest concurrent documents, in place of the former the number of workstations in the use in the Patent Search Facilities requirement in 35 U.S.C. 41(i)(1) that public search facilities have increased occurs at approximately 2 p.m. each day the USPTO maintain a collection of from 33 in 1999 to 122 in 2002 to meet with 135 users. Online statistics show a VerDate 11 daily high of 256 unique users in the 2000) (final rule). The Office has been specifications, drawings and claims. PSR and PSIRF combined. publishing patent applications (‘‘patent Extensive efforts over a number of years The Trademark Search Library application publications’’) electronically have been undertaken to ensure that this (TMSL) provides public user access to under the eighteen-month publication database is as complete as possible. As paper classified and numeric files as provisions of the AIPA since March of patents issue each week on Tuesday, well as the automated search systems 2001. The Office does not maintain this database is updated the same day used by examining attorneys: X-Search, paper copy collections of these patent with that week’s issue of patents. The the USPTO’s administrative database for application publications in either the U.S. patent image database is available tracking trademark applications and Public Search Room or the examiners’ in the public search facilities through registrations, the Trademark Recording search rooms. The Office expects that, the WEST and EAST search systems, and Monitoring system (TRAM), and due to their earlier publication date, and at no cost for search time. Both offer finally, the system that retains copies of these patent application publications the ability to mimic the search through all incoming applications, Trademark will over time replace patents as the paper classified files by allowing users Information Capture and Retrieval primary prior art and technology to retrieve patents by technology in System (TICRS). Data collections are dissemination document. See Changes accordance with the U.S. Patent maintained in several formats including to Implement Eighteen-Month Classification System. It provides a paper, automated, microfilm, and CD– Publication of Patent Applications, 65 quick flip rate through the documents, ROM. The trademark assignment of FR at 57042, 1239 Off. Gaz. Pat. Office the same way that one would conduct ownership collection is also available in at 79 (response to comment 27). Thus, a search through a stack of paper the TMSL. There are approximately 35 a complete prior art search must include patents. But unlike the paper file, the public users daily in the TMSL. a search of relevant patent application patent image database remains complete The USPTO Public Search Facilities publications. Therefore, for the prior art at all times and available to multiple serve users who are highly skilled search to be complete, any person users simultaneously. professional searchers conducting conducting a prior art search must The primary search tool used for searches for law firms, business entities, conduct an electronic search of these trademark searches called X-Search, and individuals. There is also a steady patent application publications. includes a reproduction of the mark, as stream of new customers who use the The USPTO has invested, and well as other information, from every facilities for a very limited time and for continues to invest, a substantial pending application and active purposes of a fairly narrow scope. There portion of its appropriation in the registration. It also includes the mark, are approximately 300 new users every maintenance of patent and trademark and other information, from any month. Although paper files have been electronic databases and the abandoned application, or any canceled available throughout the deployment of development and enhancement of or expired registration, unless the our electronic search systems, use of software search vehicles. As a result, application was abandoned or the electronic search systems has increased trademark examining attorneys rely registration was expired or canceled beyond our expectations. We have solely on electronic records for before March 1, 1983. The database also responded by adding extra workstations examining and approving marks for includes the marks protected under to ensure ready availability of the Federal registration. Additionally, in Article 6ter of the Paris Convention for electronic search systems for all users. view of patent examiners’ increasing the Protection of Industrial Property. The ability to conduct a complete reliance on automated searching, the This database can be searched using a patent or trademark search depends as USPTO began phased elimination of variety of approaches, e.g., by mark, by much on the capability of the searcher paper copies of U.S. patents from owner name, by filing date, etc. The as it does on the availability and database is updated daily, with new completeness of the data. Expert examiner search files beginning in October 2001. It is anticipated that by information concerning pending and searchers are not limited to residing in registered trademarks. It surpasses the the Washington, DC area; nor are they the time the agency completes its relocation and consolidation at the completeness and timeliness of the limited to using the resources available paper classified trademark registrations Carlyle campus in Alexandria, Virginia, in the USPTO on-campus search because, among other things, the paper in 2005, a substantial portion of the facilities. Electronic patent and document must be printed from the patent examiner paper search files will trademark searching is also not a new same system that uploads the data to the phenomenon. Commercial online have been eliminated. The USPTO’s current planning trademark database. Then the paper databases first appeared in the early copies must be marked for filing, and 1970’s. The USPTO has over 16 years of approach to the dissemination of patent and trademark information is to then filed. This additional processing experience in providing online access to needed to maintain the paper classified continue enhancing its electronic the public for its searchable databases. trademark registration collection makes databases that capture the content of These 16 years have seen tremendous it a less timely collection, and therefore, patents and trademarks, and to continue change and significant improvement in less accurate to search. In addition, to support the USPTO Web site, the the systems available from the USPTO. pending applications that abandoned network of 87 Patent and Trademark It should also be mentioned that the after 1983 and before 1990 have been Depository Libraries, and the sale of its AIPA amended 35 U.S.C. 122 to provide purged from the paper files but remain data products. for the publication of pending patent available in the electronic files. This applications, with certain exceptions, III. Proposed Plan for an Electronic makes the electronic search systems promptly after the expiration of a period Public Search Facility more comprehensive in scope. of eighteen months from the earliest The electronic systems that would filing date for which a benefit is sought A. Status of Replacement Electronic replace the paper collections in the (‘‘eighteen-month publication’’). See Search Systems search facilities were developed Changes to Implement Eighteen-Month The U.S. patent image database specifically for use by USPTO Publication of Patent Applications, 65 contains the complete printed patent of examiners using a well-defined and long FR 57023, 57024 (Sept. 20, 2000), 1239 all patents granted from 1790 to date, established process that guides and Off. Gaz. Pat. Office 63, 64 (Oct. 10, including bibliographic information, controls the development and VerDate 11 implementation of information records management requirement of The USPTO received a number of technology initiatives. The USPTO, in National Archives and Records comments that did not pertain to the making these systems available in the Administration (NARA). paper removal plan. They included public search facilities, recognized that 1. Patent Classified Search Files comments regarding patent text there might be different requirements (Patent Search Room, Crystal Plaza 3/4, searching, foreign patent documents, for public access. The USPTO makes an Lobby Level-Room 1A01, 2021 South non-patent literature, and questions that effort to obtain public user requirements Clark Place) appear to be requests for information from internal and external sources, Copies of printed domestic patents. under the Freedom of Information Act, although enhancements required to Domestic patents are arranged first by and are therefore not germane to the achieve improved examiner group and then by subgroup. These issue. productivity have priority. copies are used to facilitate public The notice particularly solicited input Enhancements to systems are patent searches by class and subclass. on the following items: announced in the search facilities and a. Measures required to ensure the are often available for demonstration to Disposition integrity of electronic records. the public prior to deployment. USPTO Nonrecord: Destroy when no longer b. Comparable functionality for electronic search systems are well needed for public reference. supported in the event of unscheduled searching and retrieving information 2. Registered Trademarks (Trademark from electronic records. downtime. Service goals for the public Search Library, South Tower Building, c. Reclassification of the patent as well as the examining corps are in Room 2B30, 2900 Crystal Drive) electronic file. place and supported by USPTO Trademarks registered by the USPTO for management. Each step taken to correct national and international business, d. Paper disposition. an unscheduled interruption in service government, membership, and service is documented, shared widely D. Timetable for Removal of Paper organizations. Records consist of Collections internally, and tracked for completion. individual sheets by registration number Redundant formats of source documents cross-filed in the appropriate design The USPTO proposes to begin the are readily available in the public search categories and in the following groups: removal of paper classified U.S. facilities in microfilm, CD–ROM, DVD– words, international registrations, art of trademark registrations and U.S. patents ROM, and numerically arranged bound manufacturing, and color marks. at the earliest time permitted by law. It paper format, in the event of system Includes foreign marks submitted under is anticipated that one collection would downtime. Searchers may also utilize the Paris Convention by the WIPO and be completely removed before the resources on the USPTO Web site. government agencies which entered removal of the other collection begins Like paper files, errors can occur in although no determination has yet been electronic search systems. However, their logos and weapons names into the search files under Executive Order made about which of the two identified mechanisms are in place for tracking, collections would be removed first. All reporting and fixing errors that are made 11628, FR vol.36, No. 203, Oct. 20, 1971. Covers records from 1870 to the paper identified for removal would be as a result of internal processes. The removed by the time the new electronic paper classified files are incomplete by present for paper copies. Used as the public reference copy. search facility opens in the USPTO’s nature of the format. There may be consolidated facility on the Carlyle site missing or misfiled documents, Disposition in Alexandria, Virginia, which is potentially impacting search results currently under construction. The space which rely only on the paper classified Nonrecord: Destroy when no longer needed for public reference. for the electronic search facility is files. expected to be available in the fall of The USPTO follows the regulations The USPTO has determined that these 2004. The removal of paper would be and requirements of Federal agency collections are no longer needed for handled in such a manner as to cause records management, and the agency public reference because of the as little inconvenience and disruption to provides for effective controls over the availability of mature and reliable maintenance of its records, in all media, replacement in-house electronic search public users as possible. paper and electronic, in accordance systems in its public search facilities E. Interim Steps with 44 U.S.C. 3102. The agency has already described. The USPTO, working with guidance established effective controls for C. Public Comment electronic information. Controls are in from NARA, proposes to seek a place throughout the life cycle of any The USPTO undertook, as required by governmental entity or non-profit information system that contains and AIPA, a period of public comment on organization to accept the two paper provides access to computerized Federal issues related to the removal of paper. collections and assume the records and nonrecord information. The See Notice of Request for Comments on responsibility for their update and USPTO is committed to ensuring the Development of a Plan to Remove the maintenance. Failing interest, the integrity of data when changes in media Patent and Trademark Classified Paper USPTO would seek opportunities for and format occur. Files From the Public Search Facilities, sale of the collections. 66 FR 45012 (Aug. 27, 2001), 1250 Off. • At the time the USPTO begins B. Paper Records Identified for Removal Gaz. Pat. Office 137 (Sept. 25, 2001). seeking a governmental entity or non- The USPTO proposes to remove the The original deadline for comment was profit organization to accept the two following paper collections of patents September 29, 2001. The notice was paper collections, the USPTO will stop and trademark registrations, located on subsequently reopened for comment on adding any more weekly patent issues USPTO premises in Arlington, Virginia, October 4, 2001, with a second deadline or trademark registrations to the at the earliest time permitted by law. of October 29, 2001. A total of 49 collections. In addition, the USPTO The descriptions and associated responses were received. Both the would also begin moving certain paper dispositions of these two collections are original notice and all responses are collections from the public search cited from the Comprehensive Records available for viewing on the USPTO facility for storage pending their Schedule maintained by the agency as a Web site at www.uspto.gov. transfer, sale, or destruction. VerDate 11 • The USPTO would continue to add functionality to the paper files and VI. Interest in Acquiring the Paper workstations for the public to search superior storage, maintenance and Patent and Trademark Collections To databases as demand increases. efficiency features. The USPTO Be Removed From the USPTO’s Public • The USPTO would continue to offer proposes to eliminate the classified Search Facilities public training in all of its electronic paper patents and trademark search systems for varying levels of registrations from the Trademark Search Any donation of the paper patent or expertise. Library located in the South Tower trademark registration collections must • The USPTO would continue to offer Building, 2900 Crystal Drive, and the comply with the NARA regulations for specialized reference services tailored to Patent Search Room located in the the donation of temporary records the particular needs of novice users in Crystal Plaza 3/4, 2021 South Clark which are set out in 36 CFR 1228.60. patent and trademark searching. Place. Elimination of these paper files is For example, the donee must be a • The USPTO would continue its consistent with the USPTO’s goals, governmental entity or non-profit efforts to comply with ergonomic design strategic information technology plans, organization and must agree not to sell standards for computer workstations. and the agency’s operational practices. the patent or trademark registration • The USPTO would continue to collections except as wastepaper, the advise the public in the search facilities V. Issues for Public Comment donation must be made without cost to about progress regarding paper removal A. To Present Written Comments the United States Government, and through a series of posted public NARA must provide written approval of notices, similar to public notices that The USPTO wants to obtain the donation. Thus, even if there is have been posted in the past regarding comments and suggestions on the interest by a governmental entity or equipment, systems and other issues proposed plan for an electronic public non-profit organization in acquiring the impacting the public. search facility. Interested members of patent or trademark registration The USPTO would continue to refine the public are invited to present oral or collections removed from the USPTO’s its planned electronic public search written comments on any issues they public search facilities, the USPTO may facility for the new space in Alexandria believe relevant to the proposed plan. still dispose of these collections as to reflect ongoing developments in The USPTO reserves the right to limit wastepaper if the USPTO cannot donate public use of the current facilities such the number of public comments them to the governmental entity or non- as reducing wait times for system access presented if necessary due to time profit organization in a cost-effective and designing sufficient work and table constraints at the hearing, but will manner or if the USPTO cannot obtain spaces to maximize terminal use. accept and consider all written written approval for the donation by comments submitted. In your response, NARA in a timely manner. Finally, as F. Final Status please include the following: the USPTO will not be conducting a file At the completion of the removal of • name and affiliation of the integrity review of the patent or the two identified paper collections, the individual responding; trademark registration collections as USPTO would consolidate its patent they are being removed from the public • clear identification of the matter and trademark public search facilities search facilities, the USPTO cannot being addressed; into one consolidated electronic public assure that the patent or trademark • search facility with the full complement an indication of whether comments registration collections being removed of well-supported electronic search offered represent views of the the public search facilities are complete. systems, trained staff, and ergonomic respondent’s organization or are the Dated: April 3, 2002. workstations. respondent’s personal views; and James E. Rogan, Fees to access USPTO electronic • if applicable, information on the search systems were temporarily respondent’s organization, including the Under Secretary of Commerce for Intellectual suspended in the USPTO public search Property and Director of the United States type of organization (e.g., business, Patent and Trademark Office. facilities beginning October 1, 1999. trade group, university, non-profit These fees would be permanently organization). Appendix; Selected USPTO Electronic waived at the time of the disposal of the Databases and Search Tools Made classified paper files so that access to all B. To Request an Opportunity To Speak Publicly Available USPTO electronic search systems in the at the Hearing In the Public Search Facilities: public search facilities would be free. Persons interested in speaking should Charges for printing hard copies • Public EAST & WEST Systems: the full send their request by electronic mail would remain in place. text of over 2.5 million U.S. patents issued message over the Internet to: paper- Numeric sets of U.S. patents and U.S. since January 1971; the full images of over [email protected]. Requests to speak trademark registrations would continue 6.5 million U.S. patents issued since 1790 should include: to be maintained in combinations of and over 14.5 foreign patents; English various formats including paper, • name and affiliation of the translations of 5.1 million Japanese patent microfilm, CD–ROM and DVD–ROM. individual requesting the opportunity to abstracts; and English translations of 3.1 speak; million European patent abstracts. • IV. Conclusion • X-Search System: text and image of over the organization represented by the 2.7 million trademark applications and The USPTO is mandated to operate in respondent; a cost-effective manner, and to continue registrations (including active, canceled, • contact information (address, expired, and abandoned). moving toward an online environment telephone, e-mail); • Cassis2: A suite of optical disc products for service delivery to its customers. The • providing access to patent and trademark USPTO has devoted significant information on the specific focus or interest of the respondent or the search tools, patent classification data, and resources to the successful development selected bibliographic data. respondent’s organization. of electronic search systems. These • USAPat: Facsimile Images of United systems are now widely used Speakers should provide a written States Patents on DVD-ROM and CD-ROM throughout the USPTO public search copy of their remarks for inclusion in • USAMark: Facsimile Images of United facilities. They provide equivalent the record. States Trademark Registrations on CD-ROM VerDate 11 On the USPTO Web site: before the meeting. Reasonable Public comment presentations will be • Trademark Electronic Search System provision will be made, if time permits, limited to two minutes each and must (TESS): searchable database including the for an oral presentation of no more than be provided in writing prior to the full text and clipped images of all registered five minutes each in duration. meeting. Mail written presentations and trademarks; For further information concerning requests to register to attend the open • U.S. patents issued from 1790 through this meeting, please contact Natalie A. public session to: Nancy Rizor, RAND, 1975—searchable by patent number and Markman or William Penner at 202– 1200 South Hayes Street, Arlington, VA current U.S. patent classification; 418–5060. • U.S. patents issued from 1976 to the 22202–5050. most recent issue week—searchable by full- Issued by the Commission in Washington, Public seating for this meeting is text fields that now include current U.S. DC, on April 3, 2002. limited, and is available on a first-come, classification data; Jean A. Webb, first-served basis. • Published applications; and Secretary of the Commission. Dated: April 5, 2002. • Patent and trademark manuals and Patricia L. Toppings, search tools. [FR Doc. 02–8543 Filed 4–8–02; 8:45 am] BILLING CODE 6351–01–M OSD Federal Register Liaison Officer, [FR Doc. 02–8544 Filed 4–8–02; 8:45 am] Department of Defense. BILLING CODE 3510–16–P [FR Doc. 02–8614 Filed 4–5–02; 3:16 pm] DEPARTMENT OF DEFENSE BILLING CODE 5001–08–M COMMODITY FUTURES TRADING Office of the Secretary COMMISSION DEPARTMENT OF DEFENSE Meeting of the Advisory Panel To Technology Advisory Committee Assess the Capabilities for Domestic Office of the Secretary; Meeting of the Meeting Response to Terrorist Attacks Defense Finance and Accounting Involving Weapons of Mass Service Board of Advisors This is to give notice, pursuant to Destruction Section 10(a) of the Federal Advisory AGENCY: Office of the Under Secretary of Committee Act, 5 U.S.C. App. 2, 10(a) ACTION: Notice of meeting. Defense (Comptroller), Department of that the Commodity Futures Trading Defense. Commission’s Technology Advisory SUMMARY: This notice sets forth the ACTION: Notice of meeting. Committee will conduct a public schedule and summary agenda for the meeting on Wednesday, April 24, 2002. next meeting of the Panel to Assess the SUMMARY: This notice sets forth the The meeting will take place in the first Capabilities for Domestic Response to schedule and summary agenda for the floor hearing room (Room 1000) of the Terrorist Attacks Involving Weapons of second meeting of the Defense Finance Commission’s Washington, DC, Mass Destruction. Notice of this meeting and Accounting Service (DFAS) Board headquarters, Three Lafayette Centre, is require under the Federal Advisory of Advisors. The Deputy Secretary of 1155 21st Street, NW, Washington, DC Committee Act, (Pub. L. 92–463). Last Defense chartered the Board on October 20581 from 1 to 4:30 p.m. The purpose minute meeting arrangements were not 4, 2000, to provide advice and of the meeting is to discuss technology- finalized until April 4, so this recommendations to the Secretary of related issues in the financial services announcement must be made less than Defense and Deputy Secretary of and commodity markets. 15 days before the meeting will take Defense regarding the mission of DFAS The agenda will consist of the place. Several members of the public as it transforms its financial following: who had attended past meetings have management operations, processes, and I. Introduction already been notified of this upcoming systems. The meeting will be open to II. Cyber Security meeting. the public. Notice of this meeting is III. Developments in Clearing DATES: April 11 and 12, 2002. required under the Federal Advisory IV. Final Subcommittee Reports: Committee Act. A. Standardization ADDRESSES: U.S. House of DATES: Wednesday, May 8, 2002. B. Market Access Representatives Budget Committee V. Other Business Hearing Room 210 Cannon, 1st Street ADDRESSES: Sheraton Crystal City, The meeting is open to the public. and Independence Ave., SE., Ballroom A, 1800 Jefferson Davis The Chairman of the Advisory Washington, DC 20515. Highway, Arlington, VA 22202. Committee, Commissioner Thomas J. FOR FURTHER INFORMATION CONTACT: FOR FURTHER INFORMATION CONTACT: Erickson, is empowered to conduct the RAND provides information about this Contact Beverly A. Lemon, Corporate meeting in a fashion that will, in his Panel on its Web site at http:// Planning, DFAS, Crystal Mall 3 (room judgment, facilitate the orderly conduct www.rand.org/organization/nsrd/ 206), 1931 Jefferson Davis Highway, of business. Any member of the public terrpanel; it can also be reached at (703) Arlington, VA 22240. Telephone (703) who wishes to file a written statement 413–1100 extension 5321. 607–5084. with the Advisory Committee should SUPPLEMENTARY INFORMATION: SUPPLEMENTARY INFORMATION: mail a copy of the statement to the attention of: The Technology Advisory Proposed Schedule and Agenda Proposed Schedule and Agenda Committee, c/o Commissioner Thomas Panel to Assess the Capabilities for The Defense Finance and Accounting J. Erickson, Commodity Futures Trading Domestic Response to Terrorist Attacks Service Board of Advisors will meet in Commission, Three Lafayette Centre, Involving Weapons of Mass Destruction open session from 2 p.m. to 4 p.m. on 1155 21st Street, NW., Washington, DC will meet from 9 a.m. until 5:30 p.m. on May 8, 2002. The meeting will include 20581, before the meeting. Members of April 11, 2002 and from 9 a.m. until status of action items from the October the public who wish to make oral 12:30 p.m. on April 12, 2002. Time will 31, 2001, Board of Advisors meeting, statements should inform Commissioner be allowed for public comments by status of the DFAS Corporate Balanced Erickson in writing at the foregoing individuals or organizations at the end Scorecard, and the DFAS address at least three business days the meeting on April 12. Transformation Plan. VerDate 11 Public seating is limited, and is ACTION: Notice of meeting; correction. be considered by the Commission in available on a first-come first-served determining the appropriate action to be basis. SUMMARY: The Air Force published a taken, but will not serve to make notice of meeting of the Scientific protestants parties to the proceedings. Dated: April 2, 2002. Advisory Board in the Federal Register Patricia L. Toppings, Any person wishing to become a party of March 20, 2002. The meeting date has must file a motion to intervene. Copies Alternate OSD Federal Register Liaison changed. Officer, Department of Defense. of this filing are on file with the FOR FURTHER INFORMATION CONTACT: Mr. Commission and are available for public [FR Doc. 02–8473 Filed 4–8–02; 8:45 am] Robert Ripperger, Air Force Scientific inspection. This filing may also be BILLING CODE 5001–08–M Advisory Board Secretariat, 1180 Air viewed on the Web at http:// Force Pentagon, Rm 5D982, www.ferc.gov using the ‘‘RIMS’’ link, Washington, DC 20330–1180 (703) 697– DEPARTMENT OF DEFENSE select ‘‘Docket#’’ and follow the 4811. instructions (call 202–208–2222 for Office of the Secretary; Meeting of the Correction assistance). Comments, protests and Advisory Council on Dependents’ interventions may be filed electronically In the Federal Register of March 20, Education via the Internet in lieu of paper. See, 18 2002, 67 FR 12978, second column, the CFR 385.2001(a)(1)(iii) and the AGENCY: Department of Defense. dates should be changed from April 1, instructions on the Commission’s Web ACTION: Open meeting notice. 2002 to read May 2–3, 2002. Also in the site under the ‘‘e-Filing’’ link. same notice, the addresses caption SUMMARY: Pursuant to the Federal should be changed to read: Building Magalie R. Salas, Advisory Committee Act, Appendix 2 of 880, Room A49, Kirtland Air Force Secretary. title 5, United States Code, Public Law Base, NM. [FR Doc. 02–8507 Filed 4–8–02; 8:45 am] 92–463, notice is hereby given that a Pamela D. Fitzgerald, BILLING CODE 6717–01–P meeting of the Advisory Council on Air Force Federal Register Liaison Officer. Dependents’ Education (ACDE) is scheduled to be held. [FR Doc. 02–8539 Filed 4–8–02; 8:45 am] DEPARTMENT OF ENERGY The purpose of the ACDE is to BILLING CODE 5001–05–P recommend to the Director, Department Federal Energy Regulatory of Defense Education Activity (DoDEA), Commission general policies for the operation of the DEPARTMENT OF ENERGY [Docket No. RP96–383–039] Department of Defense Dependents Schools (DoDDS); to provide the Federal Energy Regulatory Dominion Transmission, Inc.; Notice of Director with information about Commission Compliance Filing effective educational programs and [Docket No. RP99–301–045] practices that should be considered by April 3, 2002. DoDDS; and to perform other tasks as ANR Pipeline Company; Notice of Take notice that on March 28, 2002, may be required by the Secretary of Negotiated Rate Filing Dominion Transmission, Inc. (DTI) Defense. The meeting emphases will be submitted the following tariff sheet April 3, 2002. on ACDE/North Central Association disclosing a negotiated rate transaction: Take notice that on March 28, 2002, (NCA) team visits, pilot, and NCA Second Revised Sheet No. 1402 ANR Pipeline Company (ANR), DoDEA-wide school reports. tendered for filing one Firm Storage DTI states that the tariff sheet relates DATES: May 3, 2002, from 8:30 a.m. to Service Agreement and a description of to a negotiated rate transaction between 5 p.m. the essential conditions involved in DTI and Rochester Gas and Electric ADDRESSES: The meeting will be held at agreeing to a Negotiated Rate Corporation (RG&E). The transaction the Ramada Hotel Wiesbaden, Abraham Arrangement. ANR requests that the provides RG&E with firm transportation Lincoln Strasse 17, Wiesbaden, 65189, Commission approve the Negotiated service and conforms to the forms of Germany. Rate Arrangement to be effective on service agreement contained in DTI’s FOR FURTHER INFORMATION CONTACT: Ms. April 1, 2002. tariff. The term of the agreement is for Marsha Jacobson, at 703–696–4235, ANR states that the filed Negotiated a primary term of April 1, 2002, through extension 1990. Rate Arrangement reflects a negotiated March 31, 2003, and from year to year rate between ANR and Dynegy thereafter. DTI requests an effective date Dated: April 2, 2002. Marketing and Trade for transportation of April 1, 2002 for Second Revised Patricia L. Toppings, service, under one Storage Service Sheet No. 1402. Alternate OSD Federal Register Liaison agreement for a period to be effective DTI states that copies of its filing have Officer, Department of Defense. beginning April 1, 2002, until June 30, been served upon DTI’s customers, [FR Doc. 02–8472 Filed 4–8–02; 8:45 am] 2007. interested state commissions and on all BILLING CODE 5001–08–M Any person desiring to be heard or to persons on the official service list protest said filing should file a motion compiled by the Secretary of the to intervene or a protest with the Commission for this proceeding. DEPARTMENT OF DEFENSE Federal Energy Regulatory Commission, Any person desiring to protest said 888 First Street, NE., Washington, DC filing should file a protest with the Department of the Air Force 20426, in accordance with Sections Federal Energy Regulatory Commission, Headquarters United States Air Force 385.214 or 385.211 of the Commission’s 888 First Street, NE., Washington, DC Scientific Advisory Board Rules and Regulations. All such motions 20426, in accordance with Section or protests must be filed in accordance 385.211 of the Commission’s Rules and AGENCY: Department of the Air Force, with Section 154.210 of the Regulations. All such protests must be DoD. Commission’s Regulations. Protests will filed in accordance with Section VerDate 11 154.210 of the Commission’s must file a motion to intervene. Copies instructions on the Commission’s Web Regulations. Protests will be considered of this filing are on file with the site under the ‘‘e-Filing’’ link. by the Commission in determining the Commission and are available for public appropriate action to be taken, but will inspection. This filing may also be Magalie R. Salas, not serve to make protestants parties to viewed on the Web at http:// Secretary. the proceedings. Copies of this filing are www.ferc.gov using the ‘‘RIMS’’ link, [FR Doc. 02–8508 Filed 4–8–02; 8:45 am] on file with the Commission and are select ‘‘Docket#’’ and follow the BILLING CODE 6717–01–P available for public inspection. This instructions (call 202–208–2222 for filing may also be viewed on the Web assistance). Comments, protests and at http://www.ferc.gov using the ‘‘RIMS’’ interventions may be filed electronically DEPARTMENT OF ENERGY link, select ‘‘Docket#’’ and follow the via the Internet in lieu of paper. See, 18 instructions (call 202–208–2222 for CFR 385.2001(a)(1)(iii) and the Federal Energy Regulatory assistance). Comments, protests and instructions on the Commission’s Web Commission interventions may be filed electronically site under the ‘‘e-Filing’’ link. via the Internet in lieu of paper. See, 18 Magalie R. Salas, [Docket No. RP02–122–001] CFR 385.2001(a)(1)(iii) and the instructions on the Commission’s Web Secretary. Kinder Morgan Interstate Gas site under the ‘‘e-Filing’’ link. [FR Doc. 02–8512 Filed 4–8–02; 8:45 am] Transmission LLC; Notice of BILLING CODE 6717–01–P Magalie R. Salas, Compliance Filing Secretary. April 3, 2002. [FR Doc. 02–8506 Filed 4–8–02; 8:45 am] DEPARTMENT OF ENERGY Take notice that on March 29, 2002, BILLING CODE 6717–01–P Federal Energy Regulatory Kinder Morgan Interstate Gas Commission Transmission LLC (KMIGT) tendered for DEPARTMENT OF ENERGY filing its compliance filing to respond to [Docket No. RP00–340–003] certain requests for information Federal Energy Regulatory addressed in the Commission’s March Commission Gulf South Pipeline Company, LP; 13 Order in this proceeding. Notice of Compliance Filing [Docket No. RP02–218–000] KMIGT states that it has served copies April 3, 2002. of this filing upon all parties to this East Tennessee Natural Gas Company; Take notice that on March 28, 2002, proceeding. Notice of Annual Cashout Report Gulf South Pipeline Company, LP (Gulf Any person desiring to protest said April 3, 2002. South) tendered for filing as part of its filing should file a protest with the Take notice that on March 29, 2002, FERC Gas Tariff, Sixth Revised Volume Federal Energy Regulatory Commission, East Tennessee Natural Gas Company No. 1, the tariff sheets listed on 888 First Street, NE., Washington, DC (East Tennessee) tendered for filing its Attachment A to the filing, to become 20426, in accordance with Section annual cashout report for the November effective May 1, 2002. 385.211 of the Commission’s Rules and 2000 through October 2001 period in Gulf South states that these sheets Regulations. All such protests must be accordance with Rate Schedules LMS– implement Gulf South’s changes in filed in accordance with Section MA and LMS–PA. compliance with Order No. 637 which 154.210 of the Commission’s East Tennessee states that report were not subject to modification in the Regulations. Protests will be considered reflects a net loss from cashouts of Commissions March 14, 2002 Order in by the Commission in determining the $2,361,019 for the November 2000 this docket. appropriate action to be taken, but will Any person desiring to protest said through October 2001 reporting period. not serve to make protestants parties to filing should file a protest with the In accordance with its Rate Schedules the proceedings. Copies of this filing are Federal Energy Regulatory Commission, LMS–MA and LMS–PA, East Tennessee on file with the Commission and are 888 First Street, NE., Washington, DC will roll this loss forward into its next available for public inspection. This annual cashout report. 20426, in accordance with Section filing may also be viewed on the Web East Tennessee states that copies of 385.211 of the Commission’s Rules and the filing were mailed to all affected Regulations. All such protests must be at http://www.ferc.gov using the ‘‘RIMS’’ customers of East Tennessee and filed in accordance with Section link, select ‘‘Docket#’’ and follow the interested state commissions. 154.210 of the Commission’s instructions (call 202–208–2222 for Any person desiring to be heard or to Regulations. Protests will be considered assistance). Comments, protests and protest said filing should file a motion by the Commission in determining the interventions may be filed electronically to intervene or a protest with the appropriate action to be taken, but will via the Internet in lieu of paper. See, 18 Federal Energy Regulatory Commission, not serve to make protestants parties to CFR 385.2001(a)(1)(iii) and the 888 First Street, NE., Washington, DC the proceedings. Copies of this filing are instructions on the Commission’s Web 20426, in accordance with Sections on file with the Commission and are site under the ‘‘e-Filing’’ link. 385.214 or 385.211 of the Commission’s available for public inspection. This Rules and Regulations. All such motions filing may also be viewed on the Web Magalie R. Salas, or protests must be filed on or before at http://www.ferc.gov using the ‘‘RIMS’’ Secretary. April 10, 2002. Protests will be link, select ‘‘Docket#’’ and follow the [FR Doc. 02–8509 Filed 4–8–02; 8:45 am] considered by the Commission in instructions (call 202–208–2222 for BILLING CODE 6717–01–P determining the appropriate action to be assistance). Comments, protests and taken, but will not serve to make interventions may be filed electronically protestants parties to the proceedings. via the Internet in lieu of paper. See, 18 Any person wishing to become a party CFR 385.2001(a)(1)(iii) and the VerDate 11 DEPARTMENT OF ENERGY Storage Field to restore the Beech Hill copies of the environmental documents, Annex to the State Line Field. At such and will be notified of meetings Federal Energy Regulatory time, the pressure of the Oriskany associated with the Commission’s Commission formation in the State Line Field would environmental review process. [Docket No. CP02–124–000] be raised, limiting or eliminating the Environmental commenters will not be migration of gas from Been Hill. required to serve copies of filed National Fuel Supply Corporation; National Fuel also seeks temporary documents on all other parties. Notice of Application authorization to withdraw gas from two However, the non-party commenters wells within the proposed Beech Hill will not receive copies of all documents April 3, 2002. Annex pending permanent filed by other parties or issued by the On March 25, 2002, National Fuel authorization. Supply Corporation (National Fuel), 10 According to National Fuel, the Commission (except for the mailing of Lafayette Square, Buffalo, New York pending application does not seek to environmental documents issued by the 14203, filed an application in Docket change either the capacity or Commission) and will not have the right No. CP02–124–000 pursuant to Section deliverability of the storage field, nor to seek court review of the 7(c) of the Natural Gas Act (NGA) and are there any new facilities associated Commission’s final order. Part 157 of the Federal Energy with the application. The Commission may issue a Regulatory Commission’s (Commission) There are two ways to become preliminary determination on non- Regulations for amendment of its involved in the Commission’s review of environmental issues prior to the certificate of public convenience and this project. First, any person wishing to completion of its review of the necessity to authorize a revised storage obtain legal status by becoming a party environmental aspects of the project. field area for its Beech Hill Storage Field to the proceedings for this project This preliminary determination (Beech Hill) in Allegany County, New should, on or before April24, 2002, file York, all as more fully set forth in the with the Federal Energy Regulatory typically considers such issues as the application on file with the Commission Commission, 888 First Street, NE., need for the project and its economic and open to public inspection. This Washington, DC 20426, a motion to effect on existing customers of the filing may be viewed on the web at intervene in accordance with the applicant, on other pipelines in the area, http://www.ferc.gov using the ‘‘RIMS’’ requirements of the Commission’s Rules and on landowners and communities. link, select ‘‘Docket #’’ and follow the of Practice and Procedure (18 CFR For example, the Commission considers instructions (call (202)208–2222 for 385.214 or 385.211) and the Regulations the extent to which the applicant may assistance). under the NGA (18 CFR 157.10). A need to exercise eminent domain to Any questions regarding this person obtaining party status will be obtain rights-of-way for the proposed application should be directed to David placed on the service list maintained by project and balances that against the W. Reits, Assistant General Counsel for the Secretary of the Commission and non-environmental benefits to be National Fuel, 10 Lafayette Square, will receive copies of all documents provided by the project. Therefore, if a Buffalo, New York 14203, or call at filed by the applicant and by all other person has comments on community (716) 857–7949 parties. A party must submit 14 copies and landowner impacts from this Specifically, National Fuel requests of filings made with the Commission proposal, it is important either to file Commission authorization to extend and must mail a copy to the applicant comments or to intervene as early in the Beech Hill’s pool boundary in the area and to every other party in the process as possible. southwest of the field. National Fuel proceeding. Only parties to the also proposes a corresponding extension proceeding can ask for court review of Comments, protests and interventions of the Beech Hill buffer zone. These Commission orders in the proceeding. may be filed electronically via the changes will add 799 acres to the map However, a person does not have to Internet in lieu of paper. See, 18 CFR are of Beach Hill, inclusive of the buffer intervene in order to have comments 385.2001(a)(1)(iii) and the instructions zone addition. National Fuel states that considered. The second way to on the Commission’s web site under the newer seismic data and analysis of participate is by filing with the ‘‘e-Filing’’ link. reprocessed older seismic data support Secretary of the Commission, as soon as If the Commission decides to set the the extension of Beech Hill. possible, an original and two copies of application for a formal hearing before National Fuel’s application also seeks comments in support of or in opposition an Administrative Law Judge, the authorization to add approximately to this project. The Commission will Commission will issue another notice 2,115 acres of the state Line Field, consider these comments in describing that process. At the end of located to the southwest of Beech Hill, determining the appropriate action to be the Commission’s review process, a to the Beech Hill map area (this taken, but the filing of a comment alone additional acreage will be designated as will not serve to make the filer a party final Commission order approving or the Beech Hill Annex). National Fuel to the proceeding. The Commission’s denying certificate will be issued. states that the Oriskany formation rules require that persons filing Magalie R. Salas, within the Beech Hill Annex is in comments in opposition to the project Secretary. communication with Beech Hill and provide copies of their protests only to [FR Doc. 02–8503 Filed ?–??–02; 8:45 am] that gas stored in Beech Hill has the party or parties directly involved in migrated into the Beech Hill Annex the protest. BILLING CODE 6717–01–P area. It is further indicated that if the Persons who wish to comment only State Line Field is jointly developed for on the environmental review of this storage operation by National Fuel, project should submit an original and Dominion Transmission, Inc., and two copies of their comments to the Tennessee Gas Pipeline Company, as Secretary of the Commission. the companies contemplate, National Environmental commenters will be Fuel would seek further authorization to placed on the Commission’s amend the map area of the Beech Hill environmental mailing list, will receive VerDate 11 DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY Federal Energy Regulatory Federal Energy Regulatory Federal Energy Regulatory Commission Commission Commission [Docket No. RP02–217–000] [Docket No. RP02–216–000] [Docket No. GT02–13–000] Panhandle Eastern Pipe Line Reliant Energy Gas Transmission Tennessee Gas Pipeline Company; Company; Notice of Proposed Company; Notice of Crediting Report Notice of Tariff Filing Changes in FERC Gas Tariff April 3, 2002. April 3, 2002. April 3, 2002. Take notice that on March 29, 2002, Take notice that on March 28, 2002, Take notice that on March 28, 2002, Panhandle Eastern Pipe Line Company Reliant Energy Gas Transmission Tennessee Gas Pipeline Company (Panhandle) tendered for filing as part of Company (REGT) tendered for filing its (Tennessee), tendered for filing as part its FERC Gas Tariff, First Revised Annual Revenue Crediting Filing of its FERC Gas Tariff, Fifth Revised Volume No. 1, the tariff sheets listed on pursuant to its FERC Gas Tariff, Fifth Volume No. 1, Fourth Revised Sheet No. Appendix A attached to the filing to Revised Volume No. 1, Section 402, with an effective date of May 1, become effective May 1, 2002. 5.7(c)(ii)(2)B (Imbalance Cash Out), 2002. Panhandle states that this filing is Section 23.2(b)(iv) (IT, SBS and PHS Tennessee states that the revised tariff made in accordance with Section 25 Revenue Crediting) and Section 23.7 (IT sheet is being filed to reconcile a (Flow Through of Cash-Out Revenues Revenue Credit). potential conflict between the General and Penalties In Excess of Costs) of the REGT states that its filing addresses Terms and Conditions (GT&C) of its General Terms and Conditions (GT&C) FERC Gas Tariff and its pro forma in Panhandle’s FERC Gas Tariff, First the period from February 1, 2001 through January 31, 2002. The IT and storage agreement under Rate Schedule Revised Volume No. 1. The revised tariff FS, by removing the March 31 sheets filed herewith reflect there will FT Cash Balancing Revenue Credits and the IT Revenue Credit for the period termination date requirement for Rate be no Section 25 adjustment in effect for Schedule FS agreements from Article reflected in this filing are zero. Since the period May 1, 2002 through April XXVIII Section 2(b) of its GT&C. REGT’s current tariff sheets already 30, 2003. Tennessee further states that the reflect zero Cash Balancing and IT Panhandle further states that copies of proposed changes will enable Tennessee this filing are being served on all Revenue Credits, no tariff revisions are to offer its customers the contracting affected customers and applicable state necessary. flexibility they have requested. regulatory agencies. Any person desiring to be heard or to Any person desiring to be heard or to Any person desiring to be heard or to protest said filing should file a motion protest said filing should file a motion protest said filing should file a motion to intervene or a protest with the to intervene or a protest with the to intervene or a protest with the Federal Energy Regulatory Commission, Federal Energy Regulatory Commission, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 888 First Street, NE, Washington, DC 888 First Street, NE., Washington, DC 20426, in accordance with Sections 20426, in accordance with Sections 20426, in accordance with Sections 385.214 or 385.211 of the Commission’s 385.214 or 385.211 of the Commission’s 385.214 or 385.211 of the Commission’s Rules and Regulations. All such motions Rules and Regulations. All such motions Rules and Regulations. All such motions or protests must be filed in accordance or protests must be filed on or before or protests must be filed in accordance with Section 154.210 of the April 10, 2002. Protests will be with Section 154.210 of the Commission’s Regulations. Protests will considered by the Commission in Commission’s Regulations. Protests will be considered by the Commission in determining the appropriate action to be be considered by the Commission in determining the appropriate action to be taken, but will not serve to make determining the appropriate action to be taken, but will not serve to make protestants parties to the proceedings. taken, but will not serve to make protestants parties to the proceedings. Any person wishing to become a party protestants parties to the proceedings. Any person wishing to become a party must file a motion to intervene. Copies Any person wishing to become a party must file a motion to intervene. Copies of this filing are on file with the must file a motion to intervene. Copies of this filing are on file with the Commission and are available for public of this filing are on file with the Commission and are available for public inspection. This filing may also be Commission and are available for public inspection. This filing may also be viewed on the Web at http:// inspection. This filing may also be viewed on the Web at http:// www.ferc.gov using the ‘‘RIMS’’ link, viewed on the Web at http:// www.ferc.gov using the ‘‘RIMS’’ link, select ‘‘Docket#’’ and follow the www.ferc.gov using the ‘‘RIMS’’ link, select ‘‘Docket#’’ and follow the instructions (call 202–208–2222 for select ‘‘Docket#’’ and follow the instructions (call 202–208–2222 for assistance). Comments, protests and instructions (call 202–208–2222 for assistance). Comments, protests and interventions may be filed electronically assistance). Comments, protests and interventions may be filed electronically interventions may be filed electronically via the Internet in lieu of paper. See, 18 via the Internet in lieu of paper. See, 18 via the Internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the CFR 385.2001(a)(1)(iii) and the CFR 385.2001(a)(1)(iii) and the instructions on the Commission’s Web instructions on the Commission’s Web instructions on the Commission’s Web site under the ‘‘e-Filing’’ link. site under the ‘‘e-Filing’’ link. site under the ‘‘e-Filing’’ link. Magalie R. Salas, Magalie R. Salas, Magalie R. Salas, Secretary. Secretary. Secretary. [FR Doc. 02–8510 Filed 4–8–02; 8:45 am] [FR Doc. 02–8511 Filed 4–8–02; 8:45 am] [FR Doc. 02–8505 Filed 4–8–02; 8:45 am] BILLING CODE 6717–01–P BILLING CODE 6717–01–P BILLING CODE 6717–01–P VerDate 11 DEPARTMENT OF ENERGY associated with maintaining facilities determining the appropriate action to be that are not part of Texas Gas’ taken, but the filing of a comment alone Federal Energy Regulatory contiguous system. will not serve to make the filer a party Commission Texas Gas states that the transfer of to the proceeding. The Commission’s [Docket No. CP02–125–000] the subject supply lateral facilities will rules require that persons filing not adversely affect any of their current comments in opposition to the project Texas Gas Transmission Corporation; customers. Texas Gas declares that there provide copies of their protests only to Notice of Application are no firm transportation commitments the party or parties directly involved in involving utilization of those facilities. the protest. April 3, 2002. Texas Gas avers that after the transfer, Persons who wish to comment only Take notice that on March 27, 2002, ATP indicates that it will provide non- on the environmental review of this Texas Gas Transmission Corporation jurisdictional service on a non- project should submit an original and (Texas Gas), 3800 Frederica Street, discriminatory basis. Texas Gas asserts two copies of their comments to the Owensboro, Kentucky 42301, filed in that availability of service through these Secretary of the Commission. Docket No. CP02–125–000, for: (1) An facilities will not be impaired as a result Environmental commenters will be application pursuant to section 7(b) of of Texas Gas’ transfer of these facilities placed on the Commission’s the Natural Gas Act (NGA) for to ATP. authorization to abandon by sale to ATP Texas Gas states that ATP will pay environmental mailing list, will receive Oil & Gas Corporation (ATP) certain Texas Gas the sum of $100 for Texas copies of the environmental documents, supply lateral facilities extending from Gas’ interest (100%) in the facilities. and will be notified of meetings West Cameron Area Block 237 to West Texas Gas indicates that in recognition associated with the Commission’s Cameron Area Block 250, offshore of the costs associated with any future environmental review process. Louisiana and (2) a request for retirement of these facilities by ATP, an Environmental commenters will not be jurisdictional determination that, upon agreement provides for Texas Gas to pay required to serve copies of filed approval of the abandonment by sale, ATP actual and reasonable costs documents on all other parties. such facilities will be gathering associated with retirement up to However, the non-party commenters facilities, and ATP’s ownership and $100,000. will not receive copies of all documents operation of the subject supply lateral Any questions regarding this filed by other parties or issued by the facilities will be exempt from application should be directed to David Commission (except for the mailing of Commission jurisdiction under the N. Roberts, Manager of Certificates and environmental documents issued by the NGA, all as more fully set forth in the Tariffs, Texas Gas Transmission Commission) and will not have the right application which is on file with the Corporation, P.O. Box 20008, to seek court review of the Commission and open to public Owensboro, Kentucky 42304, at (270) Commission’s final order. inspection. Copies of this filing are on 688–6712. The Commission may issue a file with the Commission and are There are two ways to become preliminary determination on non- available for public inspection. This involved in the Commission’s review of environmental issues prior to the filing may be viewed on the web at this project. First, any person wishing to completion of its review of the http://www.ferc.gov using the ‘‘RIMS’’ obtain legal status by becoming a party environmental aspects of the project. link, select ‘‘Docket #’’ from the RIMS to the proceedings for this project This preliminary determination Menu and follow the instructions (call should, on or before April 24, 2002, file typically considers such issues as the (202) 208–2222 for assistance). with the Federal Energy Regulatory need for the project and its economic Texas Gas states that it has entered Commission, 888 First Street, NE., effect on existing customers of the into an agreement with ATP whereby Washington, DC 20426, a motion to applicant, on other pipelines in the area, Texas Gas will, upon Commission intervene in accordance with the and on landowners and communities. approval, transfer by sale to ATP certain requirements of the Commission’s Rules For example, the Commission considers supply lateral facilities consisting of of Practice and Procedure (18 CFR the extent to which the applicant may approximately 4.436 miles of 12-inch 385.214 or 385.211) and the Regulations need to exercise eminent domain to diameter pipeline, measurement under the NGA (18 CFR 157.10). A obtain rights-of-way for the proposed facilities, and various valves and person obtaining party status will be project and balances that against the equipment, located in West Cameron placed on the service list maintained by non-environmental benefits to be Area Block 237 and terminating in West the Secretary of the Commission and provided by the project. Therefore, if a Cameron Area Block 250, offshore will receive copies of all documents person has comments on community Louisiana. filed by the applicant and by all other and landowner impacts from this Texas Gas indicates that the proposed parties. A party must submit 14 copies proposal, it is important either to file abandonment will permit Texas Gas to of filings made with the Commission comments or to intervene as early in the divest itself of a supply lateral, which is and must mail a copy to the applicant process as possible. remote from, and not integrated with, its and to every other party in the mainline transmission system, and proceeding. Only parties to the Comments, protests and interventions which was constructed to support its proceeding can ask for court review of may be filed electronically via the former merchant function. Texas Gas Commission orders in the proceeding. Internet in lieu of paper. See, 18 CFR avers that it no longer requires the However, a person does not have to 385.2001(a)(1)(iii) and the instructions subject supply lateral to access gas intervene in order to have comments on the Commission’s web site under the supplies, and that these facilities are not considered. The second way to ‘‘e-Filing’’ link. integral to Texas Gas’ current role as an participate is by filing with the If the Commission decides to set the open-access transporter. Texas Gas Secretary of the Commission, as soon as application for a formal hearing before asserts that abandonment of the subject possible, an original and two copies of an Administrative Law Judge, the facilities will enable Texas Gas to comments in support of or in opposition Commission will issue another notice streamline its transmission operations to this project. The Commission will describing that process. At the end of by eliminating certain operating costs consider these comments in the Commission’s review process, a VerDate 11 final Commission order approving or 3. Entergy Power Ventures, L.P. Massachusetts Electric Company, denying a certificate will be issued. [Docket No. ER02–862–001] Holyoke Water Power Company, and Select Energy, Inc., submitted pursuant Magalie R. Salas, Take notice that on March 29, 2002, to Section 205 of the Federal Power Act Entergy Power Ventures, L.P., tendered Secretary. and Part 35 of the Federal Energy for filing with the Federal Energy [FR Doc. 02–8504 Filed 4–8–02; 8:45 am] Regulatory Commission’s (Commission) Regulatory Commission (Commission) BILLING CODE 6717–01–P regulations, rate schedule changes for revised tariff sheets pursuant to a sales of electricity to the City of Commission order issued on March 19, Chicopee, Massachusetts (Chicopee). DEPARTMENT OF ENERGY 2002. NUSCO states that a copy of this filing Copies of this filing have been served has been mailed to Chicopee and the Federal Energy Regulatory on the Arkansas Public Service regulatory commission for the Commission Commission, Mississippi Public Service Commonwealth of Massachusetts. Commission, Louisiana Public Service NUSCO requests that the rate schedule [Docket No. ER02–504–003, et al.] Commission, Texas Public Utility changes become effective on March 31, Commission, and the Council of the City 2002. Dayton Power and Light Company, et of New Orleans. al.; Electric Rate and Corporate Comment Date: April 19, 2002. Comment Date: April 19, 2002. Regulation Filings 4. California Independent System 7. Acadia Power Partners, LLC April 3, 2002. Operator Corporation [Docket No. ER02–1406–000] Take notice that the following filings [Docket No. ER02–1403–000] Take notice that on March 29, 2002, have been made with the Commission. Take notice that on March 29, 2002, Acadia Power Partners, LLC (the Any comments should be submitted in the California Independent System Applicant) tendered for filing, under accordance with Standard Paragraph E Operator Corporation, (ISO) tendered for section 205 of the Federal Power Act at the end of this notice. filing with the Federal Energy (FPA), a request for authorization to make wholesale sales of electric energy, 1. Dayton Power and Light Company Regulatory Commission (Commission) a Participating Generator Agreement capacity, replacement reserves, and [Docket No. ER02–504–003] between the ISO and El Dorado ancillary services at market-based rates, Take notice that on March 28, 2002, Irrigation District for acceptance by the to reassign transmission capacity, and to Dayton Power and Light (DP&L) Commission. resell firm transmission rights. tendered for filing an amendment to a The ISO states that this filing has been Applicant proposes to own and operate service agreement between The Dayton served on El Dorado Irrigation District a nominal 1100-megawatt electric Power and Light Company (DP&L) and and the California Public Utilities generation facility located in Louisiana. DP&L Energy Services in the above Commission. The ISO is requesting Applicant also submitted for filing two captioned docket. waiver of the 60-day notice requirement power purchase agreements for which it Comment Date: April 18, 2002. to allow the Participating Generator requests privileged treatment. Comment Date: April 19, 2002. 2. New York Independent System Agreement to be made effective March Operator, Inc. 19, 2002. 8. Entergy Services, Inc. Comment Date: April 19, 2002. [Docket No. ER02–638–001] [Docket No. ER02–1407–000] Take notice that on March 29, 2002, 5. California Independent System Take notice that on March 29, 2002, the New York System Operator, Inc. Operator Corporation Entergy Services, Inc., (Entergy) on (NYISO) filed revisions to its Open [Docket No. ER02–1404–000] behalf of Entergy Arkansas, Inc., Access Transmission Tariff and Services Take notice that on March 29, 2002, tendered for filing a Long-Term Market Tariff pursuant to the Commission’s the California Independent System Rate Sales Agreement between Entergy February 26, 2002 order. The purpose of Operator Corporation, (ISO) tendered for Arkansas, Inc. and East Texas Electric this filing is to eliminate tariff filing with the Federal Energy Cooperative, Inc. under Entergy provisions pertaining to the NYISO’s Regulatory Commission (Commission) a Services, Inc.’’s Rate Schedule SP. three proposed pre-scheduling Participating Generator Agreement Entergy requests an effective date of enhancements which the February 26 between the ISO and El Dorado March 1, 2002. Order rejected without prejudice. The Irrigation District for acceptance by the Comment Date: April 19, 2002. NYISO has requested an effective date Commission. 9. Entergy Services, Inc. of April 11, 2002, for the compliance The ISO states that this filing has been filing. served on El Dorado Irrigation District [Docket No. ER02–1408–000] The NYISO has mailed a copy of this and the California Public Utilities Take notice that on March 29, 2002, compliance filing to all persons that Commission. The ISO is requesting Entergy Services, Inc., on behalf of have filed interconnection applications waiver of the 60-day notice requirement Entergy Arkansas, Inc., Entergy Gulf or executed Service Agreements under to allow the Participating Generator States, Inc., Entergy Louisiana, Inc., the NYISO Open Access Transmission Agreement to be made effective March Entergy Mississippi, Inc., and Entergy Tariff, to the New York State Public 19, 2002. New Orleans, Inc., (collectively, the Service Commission, and to the electric Comment Date: April 19, 2002. Entergy Operating Companies) tendered utility regulatory agencies in New Jersey for filing a Non-Firm Point-To-Point 6. Northeast Utilities Service Company and Pennsylvania. The NYISO has also Transmission Service Agreement and a mailed a copy to each person designated [Docket No. ER02–1405–000] Short-Term Firm Point-To-Point on the official service list maintained by Take notice that on March 29, 2002, Transmission Service Agreement both the Commission for the above-captioned Northeast Utilities Service Company between Entergy Services, Inc., as agent proceeding. (NUSCO), on behalf of The Connecticut for the Entergy Operating Companies, Comment Date: April 19, 2002. Light and Power Company, Western and TECO EnergySource, Inc. VerDate 11 Comment Date: April 19, 2002. petitioned the Federal Energy Utilities Commission of Ohio and Regulatory Commission (Commission) Jackson. 10. American Electric Power Service for authority to sell electricity at market- Comment Date: April 18, 2002. Corporation based rates under Section 205(a) of the 15. American Electric Power Service [Docket No. ER02–1409–000] Federal Power Act, for the granting of Corporation Take notice that on March 29, 2002, certain blanket approvals and for the the American Electric Power Service waiver of certain Commission [Docket No. ER02–1414–000] Corporation (AEPSC), tendered for filing regulations. MNS is a limited liability Take notice that on March 28, 2002 Firm and Non-Firm Point-to-Point company that proposes to engage in the American Electric Power Service Transmission (PTP) Service Agreements wholesale sale of electric power in the Corporation tendered for filing three (3) and Long-Term Firm PTP Service state of Nevada. Service Agreements which include a Agreement Specifications for North Comment Date: April 18, 2002. Service Agreement for a new customer Carolina Electric Membership 13. NRG Rockford II LLC and two replacement Service Corporation (NCEMC). These Agreements for existing customers agreements are pursuant to the AEP [Docket No. ER02–1412–000] under the AEP Companies’ Power Sales Companies’ Open Access Transmission Take notice that on March 28, 2002, Tariffs. The Power Sales Tariffs were Service Tariff that has been designated NRG Rockford II LLC, a limited liability accepted for filing effective October 10, as the Operating Companies of the corporation organized under the laws of 1997 and have been designated AEP American Electric Power System FERC the State of Illinois, filed under section Operating Companies’ FERC Electric Electric Tariff Second Revised Volume 205 of the Federal Power Act, a request Tariff Original Volume No. 5 (Wholesale No. 6. that the Federal Energy Regulatory Tariff of the AEP Operating Companies) AEPSC requests waiver of notice to Commission (Commission) (1) accept for and FERC Electric Tariff Original permit the Service Agreements to be filing a proposed market-based FERC Volume No. 8, effective January 8, 1998 made effective on and after March 1, Rate Schedule and Service Agreement in Docket No. ER98–542–000 (Market- 2002. A copy of the filing was served thereunder; (2) grant blanket authority Based Rate Power Sales Tariff of the upon the Parties and the state utility to make market-based wholesale sales of CSW Operating Companies). AEPSC regulatory commissions of Arkansas, capacity and energy under its FERC Rate respectfully requests waiver of notice to Indiana, Kentucky, Louisiana, Michigan, Schedule; (3) grant authority to sell permit the attached Service Agreements Ohio, Oklahoma, Tennessee, Texas, ancillary services at market-based rates; to be made effective on or prior to Virginia and West Virginia. and (4) grant such waivers and blanket March 1, 2002. Comment Date: April 19, 2002. authorizations as the Commission has A copy of the filing was served upon granted in the past to other the Parties and the State Utility 11. West Texas Utilities Company nonfranchised entities with market- Regulatory Commissions of Arkansas, [Docket No. ER02–1410–000] based rate authority. Indiana, Kentucky, Louisiana, Michigan, Comment Date: April 18, 2002. Take notice that on March 29, 2002, Ohio, Oklahoma, Tennessee, Texas, West Texas Utilities Company (WTU) 14. Columbus Southern Power Virginia and West Virginia. submitted for filing ERCOT Regional Company Comment Date: April 18, 2002. Transmission Service Agreements with [Docket No. ER02–1413–000] 16. American Transmission Systems, Brazos Electric Power Cooperative, Inc., Take notice that on March 28, 2002, Inc. Big Country Electric Cooperative, Inc., Columbus Southern Power Company [Docket No. ER02–1415–000] Coleman County Electric Cooperative, (CSP), tendered for filing with the Inc., Concho Valley Electric Federal Energy Regulatory Take notice that on March 28, 2002, Cooperative, Inc., Lighthouse Electric Commission’s (Commission) Notice of American Transmission Systems, Inc., Cooperative, Inc., Pedernales Electric Cancellation for Service Agreement No. filed a Service Agreement to provide Cooperative, Inc., Rio Grande Electric 2 under FERC Electric Tariff, Fifth Non-Firm Point-to-Point Transmission Cooperative, Inc., Southwest Texas Revised Volume No. 1 (Service Service for UBS AG, London Branch, Electric Cooperative, Inc. and Taylor Agreement No. 2), which became the Transmission Customer. Services are Electric Cooperative, Inc. and Network effective on October 1, 1984. being provided under the American Integration Transmission Service CSP states that the City of Jackson, Transmission Systems, Inc. Open Agreements with Golden Spread Ohio (Jackson), the only customer Access Transmission tariff submitted for Electric Cooperative, Inc. and served by CSP under Service Agreement filing by the Federal Energy Regulatory Lighthouse Electric Cooperative, Inc. to No. 2, provided written notification of Commission (Commission) in Docket reflect the inclusion of customer Jackson’s election to terminate Service No. ER99–2647–000. The proposed specific directly assigned distribution Agreement No. 2, and that CSP and effective date under the Service charges. Jackson have agreed that Service Agreement is March 27, 2002 for the WTU seeks an effective date of April Agreement No. 2 and service to Jackson above mentioned Service Agreement in 1, 2002 and, accordingly, seeks waiver under CSP’s cost-based rates would this filing. of the Commission’s notice terminate March 31, 2002. Comment Date: April 18, 2002. requirements. WTU served a copy of the Since no service is to be provided by 17. American Transmission Systems, filing on each of the affected customers CSP under Service Agreement No. 2 Inc. and the Public Utilities Commission of after March 31, 2002, CSP requests, for Texas. good cause shown, in accordance with [Docket No. ER02–1416–000] Comment Date: April 18, 2002. Section 35.15 of the Commission’s Take notice that on March 28, 2002, 12. MNS Wind Company LLC Regulations, that its Notice of American Transmission Systems, Inc., Cancellation be made effective as of filed a Service Agreement to provide [Docket No. ER02–1411–000] April 1, 2002. Firm Point-to-Point Transmission Take notice that on March 28, 2002, CSP further states that copies of its Service for UBS AG, London Branch, MNS Wind Company LLC (MNS) filing have been served upon the Public the Transmission Customer. Services are VerDate 11 being provided under the American provide power and energy to the City of instructions on the Commission’s web Transmission Systems, Inc. Open Greenwood, South Carolina site under the ‘‘e-Filing’’ link. Access Transmission tariff submitted for (Greenwood) pursuant to an agreement Magalie R. Salas, filing by the Federal Energy Regulatory with Greenwood under SCE&G’s Secretary. Commission (Commission) in Docket Negotiated Market Sales Tariff. SCE&G [FR Doc. 02–8502 Filed 4–8–02; 8:45 am] No. ER99–2647–000. The proposed has requested an effective date for this effective date under the Service Agreement of March 1, 2002. BILLING CODE 6717–01–P Agreement is March 27, 2002 for the above mentioned Service Agreement in SCE&G states that a copy of the filing this filing. has been served on SCE&G Merchant DEPARTMENT OF ENERGY Comment Date: April 18, 2002. Function, Greenwood and the South Carolina Public Service Commission. Federal Energy Regulatory 18. Virginia Electric and Power Commission Comment Date: April 18, 2002. Company [Docket No. EL01–105–001, et al.] [Docket No. ER02–1417–000] 20. South Carolina Electric & Gas Company The New Power Company, et al.; Take notice that on March 27, 2002, Electric Rate and Corporate Regulation Virginia Electric and Power Company [Docket No. ER02–1419–000] Filings (Dominion Virginia Power or the Take notice that on March 28, 2002 Company) tendered for filing the South Carolina Electric & Gas Company March 29, 2002. following Service Agreement for Firm Take notice that the following filings Point-to-Point Transmission Service by (SCE&G) filed a Full Requirements Firm Power Service Agreement (Agreement) have been made with the Commission. Virginia Electric and Power Company to Any comments should be submitted in between SCE&G the City of Greenwood, Progress Ventures Inc. designated as accordance with Standard Paragraph E South Carolina (Greenwood), under Service Agreement No. 353 under the at the end of this notice. Company’s FERC Electric Tariff, Second which SCE&G will provide full Revised Volume No. 5. requirements firm power service 1. The New Power Company v. PJM Service Agreement for Non-Firm pursuant to SCE&G’s Network Market Interconnection, L.L.C. Point-to-Point Transmission Service by Sales Tariff. [Docket No. EL01–105–001] Virginia Electric and Power Company to SCE&G has requested an effective date Take notice that on March 26, 2002, Progress Ventures Inc. designated as for this Agreement of March 1, PJM Interconnection, L.L.C. (PJM) Service Agreement No. 354 under the 2002.SCE&G states that a copy of the tendered for filing with the Federal Company’s FERC Electric Tariff, Second filing has been served on Greenwood Energy Regulatory Commission Revised Volume No. 5. and the South Carolina Public Service (Commission), pursuant to the The foregoing Service Agreements are Commission. Commission’s February 27, 2002 ‘‘Order tendered for filing under the Open Denying Complaint,’’ revisions to the Comment Date: April 18, 2002. Access Transmission Tariff to Eligible PJM Open Access Transmission Tariff Purchasers effective June 7, 2000. Under Standard Paragraph (PJM Tariff), Schedule M, to implement the tendered Service Agreements, requirements that the PJM Market Dominion Virginia Power will provide E. Any person desiring to be heard or Monitoring Unit notify the Commission point-to-point service to Progress to protest such filing should file a of significant market problems that may Ventures Inc. under the rates, terms and motion to intervene or protest with the require investigation, a change in the conditions of the Open Access Federal Energy Regulatory Commission, PJM Tariff or market rules, or action by Transmission Tariff. 888 First Street, NE., Washington, DC the Commission and/or state Dominion Virginia Power requests an 20426, in accordance with rules 211 and commissions. effective date of March 20, 2002, as 214 of the Commission’s rules of Copies of this filing have been served requested by the customer. Copies of the practice and procedure (18 CFR 385.211 on all PJM Members and the state filing were served upon Progress and 385.214). All such motions or electric regulatory commission in the Ventures Inc., the Virginia State protests should be filed on or before the PJM region. Corporation Commission, and the North comment date. Protests will be Comment Date: April 16, 2002. Carolina Utilities Commission. considered by the Commission in Comment Date: April 18, 2002. 2. New York Independent System determining the appropriate action to be Operator, Inc. 19. South Carolina Electric & Gas taken, but will not serve to make Company [Docket Nos. ER01–3155–002, ER01–1385– protestants parties to the proceeding. 010 and EL01–45–009] Any person wishing to become a party [Docket No. ER02–1418–000] Take notice that on March 20, 2002, must file a motion to intervene. Copies Take notice that on March 28, 2002, the New York Independent System South Carolina Electric & Gas Company of this filing are on file with the Operator, Inc. (NYISO) filed with the (SCE&G) filed a Network Integration Commission and are available for public Federal Energy Regulatory Commission Transmission Service Agreement and a inspection. This filing may also be (Commission) revisions to its Market Network Operating Agreement between viewed on the web at http:// Administration and Control Area SCE&G Electric Transmission and www.ferc.gov using the ‘‘RIMS’’ link, Services Tariff in order to comply with SCE&G Merchant Function (Agreement), select ‘‘Docket#’’ and follow the the Commission’s November 27, 2001 under which SCE&G Merchant Function instructions (call 202–208–2222 for Order issued in above-referenced will take transmission service pursuant assistance). Comments, protests and proceedings. to SCE&G Electric Transmission’s Open interventions may be filed electronically On March 26, 2002, NYISO filed two Access Transmission Service Tariff in via the Internet in lieu of paper. See, 18 corrected pages to its Compliance Filing order to provide the transmission CFR 385.2001(a)(1)(iii) and the regarding Comprehensive Market service necessary to allow SCE&G to Mitigation Measures and Request for VerDate 11 Interim Extension of Existing 5. Central Maine Power Company considered by the Commission in Automated Mitigation Procedure. [Docket No. ER02–1393–000] determining the appropriate action to be taken, but will not serve to make The NYISO has served copies of these Take notice that on March 27, 2002, protestants parties to the proceeding. filings to all parties that have executed Central Maine Power Company (CMP) Any person wishing to become a party Service Agreements under the NYISO’s filed a revised ‘‘Service Agreement For must file a motion to intervene. Copies Open-Access Transmission Tariff or Local Network Transmission Service of this filing are on file with the Services Tariff, to the New York State For Retail Customers’’ (LNS Agreement) Commission and are available for public Public Service Commission, the electric which describes the terms and inspection. This filing may also be utility regulatory agencies in New Jersey conditions of delivery service being viewed on the web at http:// and Pennsylvania and on the services provided by CMP and being taken by www.ferc.gov using the ‘‘RIMS’’ link, lists in the above-referenced dockets. Calpine Construction Finance Company, select ‘‘Docket#’’ and follow the L.P. (Calpine) in connection with its Comment Date: April 16, 2002. instructions (call 202–208–2222 for generating facility in Westbrook, Maine. assistance). Comments, protests and 3. Pacific Gas and Electric Company Comment Date: April 17, 2002. interventions may be filed electronically [Docket No. ER02–847–001] 6. Michigan Electric Transmission via the Internet in lieu of paper. See, 18 Take notice that on March 27, 2002, Company CFR 385.2001(a)(1)(iii) and the Pacific Gas and Electric Company [Docket No. ER02–1394–000] instructions on the Commission’s web site under the ‘‘e-Filing’’ link. (PG&E) filed rate sheets with Take notice that on March 27, 2002, appropriate rate schedule and sheet Michigan Electric Transmission Magalie R. Salas, designations in compliance with Order Company (Michigan Transco) tendered Secretary. No. 614 and the March 20, 2002 Letter for filing A Notice of Cancellation of Order issued by the Director, Division of [FR Doc. 02–8501 Filed 4–8–02; 8:45 am] Transmission Service Agreements BILLING CODE 6717–01–P Tariffs and Rates—West accepting between Michigan Transco and Nordic PG&E’s true-up rates for the years 1998, Electric, LLC (Service Agreement No. 12 1999, and 2000, and rate schedule under the International Transmission designations for PG&E First Revised ENVIRONMENTAL PROTECTION Company/Michigan Transco’s Joint AGENCY Rate Schedule FERC No. 79, in the FERC Electric Tariff No. 1) and between above-referenced docket. Michigan Transco and DTE Energy [FRL–7169–2] Copies of this filing have been served Marketing (Service Agreement No. 1 upon the Western Area Power under the International Transmission Agency Information Collection Administration and the California Company/Michigan Transco’s Joint Activities: Proposed Collection; Public Utilities Commission. FERC Electric Tariff No. 1), effective Comment Request; Commuter Choice Leadership Initiative Comment Date: April 17, 2002. December 31, 2001. Copies of this filing have been served AGENCY: Environmental Protection 3. PSI Energy, Inc. on DTE Energy Marketing and Nordic Agency (EPA). [Docket No. ER02–591–002] Electric, LLC. ACTION: Notice. Comment Date: April 17, 2002. Take notice that on March 27, 2002, SUMMARY: In compliance with the PSI Energy, Inc. (PSI), tendered for filing 7. Rochester Gas and Electric Corporation Paperwork Reduction Act (44 U.S.C. with the Federal Energy Regulatory 3501 et seq.), this document announces Commission (Commission) its [Docket No. ES02–27–000] that EPA is planning to submit the Transmission and Local Facilities Take notice that on March 27, 2002, following proposed Information Agreement (Agreement) including Rochester Gas and Electric Corporation Collection Request (ICR) to the Office of Exhibits and the 2000 Reconciliation submitted an application pursuant to Management and Budget (OMB): Summaries between PSI, Indiana section 204 of the Federal Power Act Information Collection Activities Municipal Power Agency and Wabash seeking authorization to issue short- Associated With the Commuter Choice Valley Power Association, Inc. The term securities in the aggregate amount Leadership Initiative (CCLI). Before Agreement has been designated as PSI’s of $200 million pursuant to (1) a $30 submitting the ICR to OMB for review Rate Schedule FERC No. 253. million promissory note with the Chase and approval, EPA is soliciting Comment Date: April 17, 2002. Manhattan Bank, N.A. backed by a comments on specific aspects of the Security and Loan Agreement, and (2) proposed information collection as 4. PSI Energy, Inc. various promissory notes issued under described below. [Docket No. ER02–591–002] lines of credit with various banks. DATES: Comments must be submitted on Comment Date: April 19, 2002. Take notice that on March 27, 2002, or before June 10, 2002. PSI Energy, Inc. (PSI), tendered for filing Standard Paragraph ADDRESSES: Commuter Choice with the Federal Energy Regulatory E. Any person desiring to be heard or Leadership Initiative, U.S. EPA—Mail Commission (Commission) its to protest such filing should file a Code 6406J, 1200 Pennsylvania Avenue, Transmission and Local Facilities motion to intervene or protest with the NW., Washington, DC 20460. Interested parties may obtain a copy Agreement (Agreement) including Federal Energy Regulatory Commission, of the ICR by writing to the above Exhibits and the 2000 Reconciliation 888 First Street, NE., Washington, DC address or sending an email to Summaries between PSI, Indiana 20426, in accordance with rules 211 and [email protected]. Municipal Power agency and Wabash 214 of the Commission’s rules of Valley Power Association, Inc. The practice and procedure (18 CFR 385.211 FOR FURTHER INFORMATION CONTACT: Agreement has been designated as PSI’s and 385.214). All such motions or Gwen Couts, 202–564–9347. Rate Schedule FERC No. 253. protests should be filed on or before the SUPPLEMENTARY INFORMATION: Affected Comment Date: April 17, 2002. comment date. Protests will be entities: Entities potentially affected by VerDate 11 this action are those that join the to generate, maintain, retain, or disclose Federal holidays. People interested in voluntary Commuter Choice Leadership or provide information to or for a getting information or making Initiative. No other entities are affected. Federal agency. This includes the time comments about the Disinfectants/ Title: Information Collection needed to review instructions; develop, Disinfection Byproducts, Chemical, and Activities Associated With the acquire, install, and utilize technology Radionuclides Rules: Lead and Copper Commuter Choice Leadeship Initiative; and systems for the purposes of Rule Amendment ICR should direct EPA ICR No. 2053.01 collecting, validating, and verifying inquiries or comments to the Office of Abstract: EPA and the U.S. information, processing and Ground Water and Drinking Water, Department of Transportation (DOT) are maintaining information, and disclosing Drinking Water Protection Branch, Mail launching the Commuter Choice and providing information; adjust the Code 4606M, 1200 Pennsylvania Leadership Initiative (CCLI), a voluntary existing ways to comply with any Avenue, NW, Washington, D.C. 20460. program for employer-provided previously applicable instructions and FOR FURTHER INFORMATION CONTACT: Lisa commuter benefits in which employers requirements; train personnel to be able Christ at (202)564–8354, fax (202) 564– that meet or exceed a national standard to respond to a collection of 3755, e-mail:[email protected]. of excellence are recognized by EPA. information; search data sources; SUPPLEMENTARY INFORMATION: Affected Employers voluntarily sign an complete and review the collection of Agreement with EPA committing entities: Entities potentially affected by information; and transmit or otherwise this action are Public Water Systems, themselves to taking certain actions that disclose the information. will result in reducing the number of primacy agents including regulators in single-occupancy vehicles being driven Dated: March 19, 2002. the States, Puerto Rico, the U.S. Trust to the workplace, thereby reducing Robert E. Larson, Territories; Indian Tribes and Alaska vehicle emissions. Data collection is Division Director, Transportation and Native Villages, and in some instances, required for two reasons: to make Regional Programs Division. U. S. EPA Regional Administrators and certain that participating employers are [FR Doc. 02–8534 Filed 4–8–02; 8:45 am] staff. Title: Disinfectants/Disinfection meeting the terms of the agreement and BILLING CODE 6560–50–P to evaluate the effectiveness of the Byproducts, Chemical and program. Respondents can be from any Radionuclides Rules: Lead and Copper kind of employer. An agency may not ENVIRONMENTAL PROTECTION Rule Amendment, EPA ICR No. 1896.03, conduct or sponsor, and a person is not AGENCY OMB Control No. 2040–0204 which expires September 30, 2002. required to respond to, a collection of [FRL–7169–3] information unless it displays a Abstract: The Disinfectants/ currently valid OMB control number. Agency Information Collection Disinfection Byproducts, Chemical, and The EPA would like to solicit Activities: Proposed Collection; Radionuclides Rules ICR is the result of comments to: Comment Request; Disinfectants/ a consolidation of activities covered in (i) Evaluate whether the proposed Disinfection Byproducts, Chemical and the 1998 Stage 1 DBPR ICR, some rules collection of information is necessary Radionuclides Rules: Lead and Copper and activities covered in the 1993 PWSS for the proper performance of the Rule Amendment ICR and activities and rules previously functions of the agency, including covered in other Office of Ground Water whether the information will have AGENCY: Environmental Protection Drinking Water (OGWDW) standalone practical utility; Agency (EPA). ICRs. As part of the consolidation effort, (ii) Evaluate the accuracy of the ACTION: Notice. the Disinfectants/Disinfection, agency’s estimate of the burden of the Chemical, and Radionuclides Rules ICR SUMMARY: In compliance with the proposed collection of information, will be amended to include burden and Paperwork Reduction Act (44 U.S.C. including the validity of the costs associated with the Lead and 3501 et seq.), this document announces methodology and assumptions used; Copper Rule. The National Primary (iii) Enhance the quality, utility, and that EPA is planning to submit the Drinking Water Regulations (NPDWRs) clarity of the information to be following continuing Information for Lead and Copper (The Lead and collected; and Collection Request (ICR) to the Office of Copper Rule or LCR), promulgated by (iv) Minimize the burden of the Management and Budget (OMB): EPA in 1991, is a regulatory program collection of information on those who Disinfectants/Disinfection Byproducts, mandated by the Safe Drinking Water are to respond, including through the Chemical and Radionuclides Rules: Act (SDWA). The LCR’s goal is to use of appropriate automated electronic, Lead and Copper Rule Amendment, reduce the levels of lead and copper at mechanical, or other technological EPA ICR No. 1896.03, OMB Control No. the tap to as close to the maximum collection techniques or other forms of 2040–0204 which expires September 30, contaminant level goals of 0 parts per information technology, e.g., permitting 2002. Before submitting the ICR to OMB billion (ppb) of lead and 1.3 ppb of electronic submission of responses. for review and approval, EPA is copper as possible. To accomplish this, Burden Statement: Total annual soliciting comments on specific aspects the LCR requires community and non- burden is estimated at 46,189 hours plus of the proposed information collection transient non-community water systems non-labor costs of $493. 41,759 of these as described below. to conduct periodic moitoring, optimize hours are projected to come from private DATES: Comments must be submitted on corrosion control and, under specified entities with the remainder from state or before June 10, 2002. conditions, install source water and local governments. The projected ADDRESSES: To obtain a copy of the draft treatment, conduct public education, number of respondents is 400 per year, Disinfectants/Disinfection Byproducts, and/or replace lead service lines in the with fewer in the first year and more in Chemical, and Radionuclides Rules: distribution system. the third. Burden represents once Lead and Copper Rule Amendment ICR In January 2000, EPA published the annually reporting estimated to incur a without charge, please contact the Safe Lead and Copper Rule Minor Revisions burden of 115 hours per respondent. Drinking Water Hotline (800–426–4791). (LCRMR) which eliminated unnecessary Burden means the total time, effort, or Hours of operation are 9:00 a.m. to 5:30 requirements, streamlined and reduced financial resources expended by persons p.m. (ET), Monday–Friday, excluding reporting burden, and promoted VerDate 11 consistent national implementation. The systems for the purposes of collecting, President) 925 Grand Avenue, Kansas LCRMR do not affect the lead or copper validating, and verifying information, City, Missouri 64198–0001: rule maximum contaminant level goals, processing and maintaining 1. First York Ban Corp., York, action levels, or the basic regulatory information, and disclosing and Nebraska; to increase its ownership requirements. providing information; adjust the from 20.13 percent to 21.88 percent, of Monitoring, reporting and record existing ways to comply with any the voting shares of NebraskaLand keeping are required at both the system previously applicable instructions and Financial Services, Inc., York, Nebraska, and State levels under the National requirements; train personnel to be able and thereby acquire additional voting Primary Drinking Water Regulations to respond to a collection of shares of NebraskaLand National Bank, (NPDWRs). EPA has chosen to require information; search data sources; North Platte, Nebraska. the least frequent collection that complete and review the collection of Board of Governors of the Federal Reserve remains consistent with overall public information; and transmit or otherwise System, April 4, 2002. health preservation objectives. An disclose the information. Robert deV. Frierson, agency may not conduct or sponsor, and Dated: April 2, 2002. a person is not required to respond to, Deputy Secretary of the Board. Evelyn Washington, a collection of information unless it [FR Doc. 02–8542 Filed 4–8–02; 8:45 am] displays a currently valid OMB control Acting Director, Office of Ground Water BILLING CODE 6210–01–S Drinking Water. number. The OMB control numbers for EPA’s regulations are listed in 40 CFR [FR Doc. 02–8535 Filed 4–8–02; 8:45 am] part 9 and 48 CFR Chapter 15. BILLING CODE 6560–50–P FEDERAL TRADE COMMISSION The EPA would like to solicit [File No. 012 3060] comments to: (i) Evaluate whether the proposed FEDERAL RESERVE SYSTEM Kryton Coatings International, Inc., et collection of information is necessary al.; Analysis To Aid Public Comment for the proper performance of the Formations of, Acquisitions by, and functions of the agency, including Mergers of Bank Holding Companies AGENCY: Federal Trade Commission. whether the information will have The companies listed in this notice ACTION: Proposed consent agreement. practical utility; have applied to the Board for approval, SUMMARY: (ii) Evaluate the accuracy of the pursuant to the Bank Holding Company The consent agreement in this agency’s estimate of the burden of the Act of 1956 (12 U.S.C. 1841 et seq.) matter settles alleged violations of proposed collection of information, (BHC Act), Regulation Y (12 CFR Part federal law prohibiting unfair or including the validity of the 225), and all other applicable statutes deceptive acts or practices or unfair methodology and assumptions used; and regulations to become a bank methods of competition. The attached (iii) Enhance the quality, utility, and holding company and/or to acquire the Analysis to Aid Public Comment clarity of the information to be assets or the ownership of, control of, or describes both the allegations in the collected; and the power to vote shares of a bank or draft complaint that accompanies the (iv) Minimize the burden of the bank holding company and all of the consent agreement and the terms of the collection of information on those who banks and nonbanking companies consent order—embodied in the consent are to respond, including through the owned by the bank holding company, agreement—that would settle these use of appropriate automated electronic, including the companies listed below. allegations. mechanical, or other technological The applications listed below, as well DATES: Comments must be received on collection techniques or other forms of as other related filings required by the or before May 1, 2002. information technology, e.g., permitting Board, are available for immediate ADDRESSES: electronic submission of responses. Comments filed in paper inspection at the Federal Reserve Bank form should be directed to: FTC/Office Burden Statement: The estimated indicated. The application also will be annual burden hours for the LCR of the Secretary, Room 159–H, 600 available for inspection at the offices of Pennsylvania Avenue, NW., amendment to the Disinfectants/ the Board of Governors. Interested Disinfection Byproducts, Chemical, and Washington, DC 20580. Comments filed persons may express their views in in electronic form should be directed to: Radionuclides Rules ICR are 2,431,728 writing on the standards enumerated in hours. The estimated average burden [email protected] as prescribed the BHC Act (12 U.S.C. 1842(c)). If the below. hours per response is 0.3 hours. The proposal also involves the acquisition of estimated average number of responses a nonbanking company, the review also FOR FURTHER INFORMATION CONTACT: per respondent is 2.1. The estimated includes whether the acquisition of the Hampton Newsome or Joni Lupovitz, number of likely respondents annually nonbanking company complies with the Bureau of Consumer Protection, 600 is 76,001. The estimated annual cost is standards in section 4 of the BHC Act Pennsylvania Avenue, NW., $14 million which represents O&M (12 U.S.C. 1843). Unless otherwise Washington, DC. 20580, (202) 326–2889 costs only.The estimated annual burden noted, nonbanking activities will be or 326–3743. hours and costs for the LCR amendment conducted throughout the United States. SUPPLEMENTARY INFORMATION: Pursuant will be additive to the current OMB Additional information on all bank to Section 6(f) of the Federal Trade inventory for the The Disinfectants/ holding companies may be obtained Commission Act, 38 Stat. 721, 15 U.S.C. Disinfection Byproducts, Chemical, and from the National Information Center 46(f), and Section 2.34 of the Radionuclides Rules ICR. Burden means website at www.ffiec.gov/nic/. Commission’s Rules of Practice, 16 CFR the total time, effort, or financial Unless otherwise noted, comments 2.34, notice is hereby given that the resources expended by persons to regarding each of these applications above-captioned consent agreement generate, maintain, retain, or disclose or must be received at the Reserve Bank containing a consent order to cease and provide information to or for a Federal indicated or the offices of the Board of desist, having been filed with and agency. This includes the time needed Governors not later than May 3, 2002. accepted, subject to final approval, by to review instructions; develop, acquire, A. Federal Reserve Bank of Kansas the Commission, has been placed on the install, and utilize technology and City (Susan Zubradt, Assistant Vice public record for a period of thirty (30) VerDate 11 days. The following Analysis to Aid proposed administrative complaint By direction of the Commission. Public Comment describes the terms of alleges that respondents violated the Donald S. Clark, the consent agreement, and the FTC Act by disseminating ads that made Secretary. allegations in the complaint. An unsubstantiated performance claims [FR Doc. 02–8492 Filed 4–8–02; 8:45 am] electronic copy of the full text of the about Multi-Gard. The proposed BILLING CODE 6750–01–M consent agreement package can be complaint further alleges that obtained from the FTC Home Page (for respondents represented that Multi- April 3, 2002), on the World Wide Web, Gard: (1) Provides insulation equivalent DEPARTMENT OF HEALTH AND at ‘‘http://www.ftc.gov/os/2002/04/ to seven inches of fiberglass batting; (2) HUMAN SERVICES index.htm.’’ A paper copy can be provides an insulation value of R–20; (3) obtained from the FTC Public Reference reduces energy loss, energy costs or Centers for Medicare & Medicaid Room, Room 130–H, 600 Pennsylvania utility bills by up to 40%; and (4) Services Avenue, NW., Washington, DC 20580, performs the same insulation function either in person or by calling (202) 326– as the ultra-thin ceramic technology on Notice of Hearing: Reconsideration of 2222. the space shuttle. The proposed Disapproval of Arizona State Plan Public comments are invited, and may complaint alleges that respondents Amendment 01–013. be filed with the Commission in either represented that they had a reasonable AGENCY: Centers for Medicare & paper or electronic form. Comments basis for these claims. The proposed filed in paper form should be directed Medicaid Services (CMS), HHS. compliant further alleges that, although ACTION: Notice of hearing. to: FTC/Office of the Secretary, Room the use of Multi-Gard and caulking 159–H, 600 Pennsylvania Avenue, NW., (which is provided as part of the SUMMARY: This notice announces an Washington, DC 20580. If a comment application service for Multi-Gard) may contains nonpublic information, it must administrative hearing on May 17, 2002, seal air leaks and cracks in buildings be filed in paper form, and the first page at 10 a.m., Conference Rooms 615A & of the document must be clearly labeled and, as a result, may reduce energy costs 615B; 75 Hawthorne Street; San ‘‘confidential.’’ Comments that do not in some cases, respondents did not Francisco, California 94105–3901 to contain any nonpublic information may posses and rely upon a reasonable basis reconsider our decision to disapprove instead be filed in electronic form (in that substantiated their claims. Arizona State Plan Amendment (SPA) ASCII format, WordPerfect, or Microsoft The proposed consent order contains 01–013. Word) as part of or as an attachment to provisions designed to prevent CLOSING DATE: Requests to participate in email messages directed to the following respondents from engaging in similar the hearing as a party must be received email box: [email protected]. acts and practices in the future. Part I of by the presiding officer by (April 24, Such comments will be considered by the order prohibits respondents from 2002). the Commission and will be available making any representation about the FOR FURTHER INFORMATION CONTACT: for inspection and copying at its benefits, performance or efficacy of any Kathleen Scully-Hayes, Presiding principal office in accordance with Liquid Siding, Multi-Gard, Multi-Gard Officer, CMS, C1–09–13, 7500 Security Section 4.9(b)(6)(ii) of the Commission’s R–20, Liquid Vinyl, or any other liquid Boulevard, Baltimore, Maryland 21244, Rules of Practice, 16 CFR 4.9(b)(6)(ii)). siding or coating product, including: Telephone: (410) 786–2055. Analysis of Proposed Consent Order to that such product reduces energy loss, SUPPLEMENTARY INFORMATION: This Aid Public Comment energy costs, energy consumption, or notice announces an administrative utility bills; any R-value associated with The Federal Trade Commission has hearing to reconsider our decision to accepted, subject to final approval, an such product; or such product’s disapprove Arizona’s State Plan agreement for entry of a proposed insulation qualities as compared to any Amendment (SPA) 01–013. consent order from Kryton Coatings other materials, including insulation Arizona submitted SPA 01–013, on International, Inc. and Procraft, Inc. materials, unless, at the time of making October 21, 2001. The issue is whether (‘‘respondents’’). The agreement would such representation, respondents the state can provide retroactive settle a proposed complaint by the possess and rely upon competent and payments to June 4, 1997, for school- Federal Trade Commission that reliable scientific evidence that based providers for services to children respondents engaged in unfair or substantiates the representation. eligible under the Individuals with deceptive acts or practices in violation Part IV requires respondents to notify Disabilities Education Act. For the of Section 5(a) of the Federal Trade Multi-Gard distributors and wholesalers reasons stated below, the Center for Commission Act. about this action and send them a copy Medicare & Medicaid Services (CMS) The proposed consent order has been of the consent order. The form of the was unable to approve this amendment. placed on the public record for thirty notice is provided in Attachment A to Standard appropriations language (30) days for reception of comments by the order. The remainder of the authorizes the Secretary to make payments only ‘‘for any quarter with interested persons. Comments received proposed order contains provisions respect to a state plan amendment in during this period will become part of regarding record-keeping, distribution of effect during such quarter, if submitted the public record. After thirty (30) days, the order, notification of changes in in or prior to such quarter and approved the Commission will again review the corporate status, the filing of a agreement and the comments received in that or any subsequent quarter.’’ compliance report, and termination of and will decide whether it should Under this language, the Secretary is not the order. withdraw from the agreement or make authorized to make payments for a final the agreement’s proposed order. The purpose of this analysis is to quarter based on a SPA submitted in a This matter concerns advertising facilitate public comment on the later quarter. representations made about ‘‘Multi- proposed order, and it is not intended This statutory provision is implented Gard’’ (also known as Liquid Siding, to constitute an official interpretation of by regulations at 42 CFR 430.20 (b)(1) Liquid Vinyl, or Multi-Gard R–20), a the agreement and the proposed order or and (2). The regulation precludes CMS residential coating product. The to modify their terms in any way. from approving an effective date prior to VerDate 11 the first day of the quarter in which a effect during such quarter, if submitted DEPARTMENT OF HEALTH AND plan amendment is submitted, if the in or prior to such quarter and approved HUMAN SERVICES plan amendment provides for expanded in that or any subsequent quarter.’’ Medicaid coverage or increased Under this language, the Secretary is not Administration for Children and Medicaid payment for covered services. authorized to make payments for a Families This plan amendment would expand quarter based on a SPA submitted in a coverage because the plan did not later quarter. Request for Applications Under the otherwise provide payment for services This statutory provision is Office of Community Services’ Fiscal provided by school-based providers implemented by regulations at 42 CFR Year 2002; Job Opportunities for Low- prior to July 1, 2000. Since this SPA 430.20 (b)(1) and (2). The regulation Income Individuals (JOLI) Program; would expand coverage, it could not be precludes CMS from approving an Correction and Clarification; Program approved with an effective date of June effective date prior to the first day of the Announcement No. OCS–2002–06 4, 1997, since that is prior to the first quarter in which a plan amendment is day of the quarter in which the SPA was submitted, if the plan amendment AGENCY: Office of Community Services, submitted. provides for expanded Medicaid ACF, DHHS. Section 1116 of the Social Security coverage or increased Medicaid ACTION: Clarification and correction. Act (the Act) and 42 CFR part 430 payment for covered services. This plan establish Department procedures that amendment would expand coverage SUMMARY: This document clarifies and provide an administrative hearing for because the plan did not otherwise corrects the notice that was published in reconsideration of a disapproval of a provide payment for services provided the Federal Register on Thursday, state plan or plan amendment. The CMS by school-based providers prior to July February 21, 2002, Part II (67 FR 8074). is required to publish a copy of the 1, 2000. Since this SPA would expand It clarifies the notice by explaining that notice to a state Medicaid agency that coverage, it could not be approved with Faith-Based organizations are eligible to informs the agency of the time and place an effective date of June 4, 1997, since apply, and corrects the notice by of the hearing and the issues to be that is prior to the first day of the changing the due date of applications. considered. If we subsequently notify quarter in which the SPA was the agency of additional issues that will submitted. FOR FURTHER INFORMATION CONTACT: be considered at the hearing, we will Therefore, based on the reasoning set Aleatha E. Slade at (202) 401–5317, also publish that notice. forth above, and after consultation with Thelma M. Woodland at (202) 401– Any individual or group that wants to the Secretary as required under 42 CFR 5294, or the OCS Operation Center at 1– participate in the hearing as a party 430.15(c)(2), CMS disapproved Arizona 800–281–9519 for referral to the must petition the presiding officer SPA 01–013. I am scheduling a hearing appropriate contact person in OCS for within 15 days after publication of this on your request for reconsideration to be programmatic questions or send an e- notice, in accordance with the held May 17, 2002, at 10:00 a.m., mail to [email protected]. requirements contained at 42 CFR Conference Rooms 615A & 615B; 75 Clarification 430.76(b)(2). Any interested person or Hawthorne Street; San Francisco, organization that wants to participate as California 94105–3901. If this date is not In the Federal Register issue of amicus curiae must petition the acceptable, we would be glad to set February 21, 2002 (67 FR 8074), page presiding officer before the hearing another date that is mutually agreeable 8075, third column, Program Objectives begins in accordance with the to the parties. The hearing will be and Requirement, Section ‘‘A. Eligible requirements contained at 42 CFR governed by the procedures prescribed Applicants’’, after the end of the first 430.76(c). If the hearing is later at 42 CFR, part 430. paragraph, ‘‘* * * of such Code.’’, add rescheduled, the presiding officer will I am designating Ms. Kathleen Scully- the following: notify all participants. Hayes as the presiding officer. If these Faith-Based organizations that are The notice to Arizona announcing an arrangements present any problems, exempt from taxation under 501(1) of administrative hearing to reconsider the please contact the presiding officer. In the Internal Revenue Code of 1986 by disapproval of its SPA reads as follows: order to facilitate any communication reason of paragraph (3) or (4) of section Ms. Phyllis Biedess, Director, Arizona which may be necessary between the 501(c) of such Code are also eligible to Health Care Cost Containment System, parties to the hearing, please notify the apply for funds under this program 801 E. Jefferson, Phoenix, Arizona presiding officer to indicate announcement. 85034. acceptability of the hearing date that has Dear Ms. Biedess: I am responding to been scheduled and provide names of Correction your request for reconsideration of the the individuals who will represent the decision to disapprove Arizona State State at the hearing. The presiding In the Federal Register issue of Plan Amendment (SPA) 01–013. officer may be reached at (410) 786– February 21, 2002 (67 FR 8074), on page Arizona submitted SPA 01–013 on 2055. 8074, first column, under ‘‘Dates,’’ end October 21, 2001. The issue is whether of first sentence that reads, ‘‘before the state can provide retroactive Sincerely, Thomas A. Scully April 22, 2002.’’, please correct to read: payments to June 4, 1997, for school- ‘‘before May 22, 2002. In view of the based providers of services to children Section 1116 of the Social Security Act (42 U.S.C. 1316); 42 CFR 430.18. above clarification of Faith-Based eligible under the Individuals with organizations, the deadline is being Disabilities Education Act. For the (Catalog of Federal Domestic Assistance extended an additional thirty (30) days reasons stated below, the Center for Program No. 13.714, Medicaid Assistance through May 22, 2002.’’ Medicare & Medicaid Services (CMS) Program) Dated: April 1, 2002. was unable to approve this amendment. Thomas A. Scully, Standard appropriations language Administrator, Centers for Medicare & Clarence Carter, authorizes the Secretary to make Medicaid Services. Director, Office of Community Services. payments only ‘‘for any quarter with [FR Doc. 02–8471 Filed 4–8–02; 8:45 am] [FR Doc. 02–8541 Filed 4–8–02; 8:45 am] respect to a state plan amendment in BILLING CODE 4120–01–P BILLING CODE 4184–01–M VerDate 11 DEPARTMENT OF HEALTH AND Prevention and Control Act of 1970) 1.3 How is the substance supplied? HUMAN SERVICES provides that when WHO notifies the (Imported/Manufactured in the country) United States under Article 2 of the 2. ABUSE OF THE SUBSTANCE Food and Drug Administration 2.1 Is the substance abused or misused in Convention on Psychotropic Substances your country? (Yes/No/No information) [Docket No. 02N–0101] that it has information that may justify 2.2 If yes, is the abuse increasing? (Yes/No/ adding a drug or other substances to one No information) International Drug Scheduling; of the schedules of the convention, 2.3 Any information on the extent of public Convention on Psychotropic transferring a drug or substance from health or social problems associated with the Substances; Single Convention on one schedule to another, or deleting it abuse of the substance (statistics on cases of Narcotic Drugs; Amfepramone from the schedules, the Secretary of overdose deaths, dependence, etc.)? State must transmit the notice to the 3. ILLICIT ACTIVITIES INVOLVING THE (diethylpropion); Amineptine; SUBSTANCE Buprenorphine; Delta–9– Secretary of Health and Human Services 3.1 Any information on the nature and tetrahydrocannabinol (dronabinol); (the Secretary of HHS). The Secretary of extent of illicit activities involving the Tramadol HHS must then publish the notice in the substance (clandestine manufacture, Federal Register and provide smuggling, diversion, seizure, etc.)? AGENCY: Food and Drug Administration, opportunity for interested persons to 4. IMPACT OF TRANSFER TO A HIGHER HHS. submit comments that will be SCHEDULE ACTION: Notice. considered by HHS in its preparation of 4.1 If amfepramone is transferred to the scientific and medical evaluations of Schedule III of the Convention on SUMMARY: Psychotropic Substances, do you think that The Food and Drug the drug or substance. Administration (FDA) is requesting its availability for medical use will be interested persons to submit comments I. WHO Notification reduced? (Yes/No/No opinion) concerning abuse potential, actual 4.2 If yes, would the reduction adversely The Secretary of HHS received the affect the provision of medical care? (Yes/No/ abuse, medical usefulness, trafficking, following notices from WHO: No opinion) and impact of scheduling changes on Ref: C.L.4.2002 Please elaborate: availability for medical use of five drug WHO QUESTIONNAIRE FOR 2. AMINEPTINE (INN) substances. These comments will be COLLECTION OF INFORMATION FOR considered in preparing a response from REVIEW OF DEPENDENCE–PRODUCING 1. LEGITIMATE USE OF THE SUBSTANCE the United States to the World Health PSYCHOACTIVE SUBSTANCES 1.1 Is the substance currently registered as Organization (WHO) regarding the abuse The Director-General of the World Health a medical product? (Yes/No) Please indicate trade name(s), dosage liability and diversion of these drugs. Organization presents her compliments and has the pleasure of informing Member States form(s) with strength(s) and indication(s): WHO will use this information to 1.2 Is there other legitimate use of the consider whether to recommend that that the Thirty-third Expert Committee on ______Drug Dependence (ECDD) will meet from 17 substance? (No/Yes, it is used for .) certain international restrictions be to 20 September 2002 to review the following 1.3 How is the substance supplied? placed on these drugs. This notice substances: (Imported/Manufactured in the country) requesting comments is required by the 1. Amfepramone (International 2. ABUSE OF THE SUBSTANCE Controlled Substances Act (CSA). Nonproprietary Name (INN))1 2.1 Is the substance abused or misused in 2. Amineptine (INN) your country? (Yes/No/No information) DATES: Submit written or electronic 2.2 If yes, any information on the extent of comments by May 9, 2002. 3. Buprenorphine (INN) 4. Delta–9–tetrahydrocannabinol2 abuse? ADDRESSES: Submit written comments 5. Tramadol (INN) 2.3 Any information on the extent of public health or social problems associated with the to the Dockets Management Branch One of the essential elements of the abuse of the substance (statistics on cases of (HFA–09305), Food and Drug established review procedure is for the overdose deaths, dependence, etc.)? Administration, 5630 Fishers Lane, rm. Secretariat to collect relevant information 3. ILLICIT ACTIVITIES INVOLVING THE from Member States to prepare a Critical 1061, Rockville, MD 20852. Submit SUBSTANCE Review document for submission to the electronic comments to http:// 3.1 Any information on the nature and Expert Committee on Drug Dependence. The www.fda.gov/dockets/ecomments. extent of illicit activities involving the World Health Organization invites Member substance (clandestine manufacture, FOR FURTHER INFORMATION CONTACT: States to collaborate, as in the past, in this smuggling, diversion, seizure, etc.)? James R. Hunter, Center for Drug process by providing pertinent information 4. IMPACT OF SCHEDULING Evaluation and Research (HFD–9), Food mentioned in the attached questionnaire and Drug Administration, 5600 Fishers 4.1 If amineptine is placed under concerning the substances listed above. international control, do you think that its Lane, Rockville, MD 20857, 301–827– Further clarification on any of the above availability for medical use will be reduced? 1999, e-mail: [email protected]. items can be obtained from Quality (Yes/No/No opinion) Assurance and Safety: Medicines (QSM), SUPPLEMENTARY INFORMATION: The 4.2 If yes, would the reduction adversely Essential Drugs and Medicines Policy (EDM), affect the provision of medical care? (Yes/No/ United States is a party to the 1971 WHO, Geneva, to which replies should be Convention on Psychotropic No opinion) sent not later than 17 May 2002. Please elaborate: Substances. Article 2 of the Convention GENEVA, 7 February 2002 on Psychotropic Substances provides 3. BUPRENORPHINE (INN) 1. AMFEPRAMONE (INN) that if a party to the convention or WHO 1. LEGITIMATE USE OF THE SUBSTANCE has information about a substance, 1. LEGITIMATE USE OF THE SUBSTANCE 1.1 Is the substance currently registered as which in its opinion may require 1.1 Is the substance currently registered as a medical product? (Yes/No) international control or change in such a medical product? (Yes/No) Please indicate trade name(s), dosage Please indicate trade name(s), dosage form(s) with strength(s) and indication(s): control, it shall so notify the Secretary form(s) with strength(s) and indication(s): General of the United Nations and 1.2 Is there other legitimate use of the 1.2 Is there other legitimate use of the substance? (No/Yes, it is used for ______.) ______provide the Secretary General of the substance? (No/Yes, it is used for .) 1.3 How is the substance supplied? United Nations with information in (Imported/Manufactured in the country) support of its opinion. 1 If the reply to the questionnaire provides 2. ABUSE OF THE SUBSTANCE The CSA (21 U.S.C. 811 et seq.) (Title sufficient information for a critical review. 2.1 Is the substance abused or misused in II of the Comprehensive Drug Abuse 2 Including dronabinol (INN). your country? (Yes/No/No information) VerDate 11 2.2 If yes, is the abuse increasing? (Yes/No/ substance (clandestine manufacture, Delta–9–tetrahydrocannabinol (delta– No information) smuggling, diversion, seizure, etc.)? 9–THC), the active component of 2.3 Any information on the extent of public 4. IMPACT OF SCHEDULING marijuana, is currently controlled in health or social problems associated with the 4.1 If tramadol is placed under Schedule I of the CSA. Synthetic delta– abuse of the substance (statistics on cases of international control, do you think that its 9–THC, or dronabinol, is the active overdose deaths, dependence, etc.)? availability for medical use will be reduced? 3. ILLICIT ACTIVITIES INVOLVING THE (Yes/No/No opinion) component of the drug product Marinol, SUBSTANCE 4.2 If yes, would the reduction adversely which is marketed in the United States 3.1 Any information on the nature and affect the provision of medical care? (Yes/No/ as an antiemetic in the setting of cancer extent of illicit activities involving the No opinion) chemotherapy and for treatment of AIDS substance (clandestine manufacture, Please elaborate: wasting syndrome. Dronabinol in smuggling, diversion, seizure, etc.)? sesame oil and encapsulated in an FDA- II. Background 4. IMPACT OF TRANSFER TO SCHEDULE I/ approved product is controlled in II OF THE SINGLE CONVENTION ON NARCOTIC DRUGS, 1961, ON MEDICAL Amfepramone, also known in the Schedule III of the CSA. Marinol is the AVAILABILITY United States as diethylpropion, is only product that meets this definition. 4.1 If buprenorphine is transferred from classified as an anorexiant with Dronabinol (which is the synthetic Schedule III of the Convention on pharmacological effects similar to the equivalent of the natural active Psychotropic Substances to either Schedule I amphetamines. It is marketed in the component of marijuana, delta–9–THC) or II of the Single Convention on Narcotic United States for short term (8 to 12 in any other form is controlled in Drugs, do you think that its availability for weeks) use, in conjunction with a Schedule I of the CSA. The drug medical use will be reduced? (Yes/No/No substance dronabinol is controlled opinion) regimen of weight reduction based on 4.2 If yes, would the reduction adversely caloric restriction, in patients with internationally in Schedule II of the affect the provision of medical care? (Yes/No/ obesity and who have not responded to Psychotropic Convention. No opinion) an appropriate weight reducing regimen Tramadol is a centrally acting Please elaborate: (diet or exercise) alone. It is controlled synthetic analgesic. At least two complementary mechanisms of action 4. DELTA–9–TETRAHYDROCANNABINOL3 domestically in Schedule IV of the CSA appear applicable: binding of parent and 1. LEGITIMATE USE OF THE SUBSTANCE and internationally in Schedule IV of the Psychotropic Convention. metabolite to mu-opioid receptors and 1.1 Is the substance currently registered as weak inhibition of the reuptake of a medical product? (Yes/No) Amineptine is classified as a tricyclic Please indicate trade name(s), dosage antidepressant. It is not marketed in the norepinephrine and serotonin. It is form(s) with strength(s) and indication(s): United States. It has been marketed in marketed in the United States for the 1.2 If the answer to 1.1 is no, is there other other countries for the treatment of treatment of moderate to moderately legitimate use of the substance? (Yes/No) severe pain. Cases of abuse and major depressive disorders and has also If yes, please describe the purpose of use. dependence of tramadol have been been studied for its potential use in the 1.3 If there is legitimate use of the reported. It is not controlled in the treatment of amphetamine withdrawal. substance, how is the substance supplied? United States under the CSA or In 1999, amineptine products were (Imported/Manufactured in the country) controlled internationally under the 2. ABUSE OF THE SUBSTANCE voluntarily removed from the market in Psychotropic Convention or the Single 2.1 Is the substance abused or misused in France and Portugal due to risks of Convention on Narcotic Drugs. your country? (Yes/No) misuse and addiction. It is not 2.2 If yes, any information on the extent of controlled in the United States under III. Opportunity to Submit Domestic abuse? the CSA or internationally under the Information 2.3 Any information on the extent of public health or social problems associated with the Psychotropic Convention or the Single As required by section 201(d)(2)(A) of abuse of the substance (statistics on cases of Convention on Narcotic Drugs. the CSA (21 U.S.C. 811(d)(2)(A)), FDA, overdose deaths, dependence, etc.)? Buprenorphine is a semisynthetic on behalf of the Department of Health 3. ILLICIT ACTIVITIES INVOLVING THE opium derivative with partial mu-opioid and Human Services (DHHS), invites SUBSTANCE receptor agonist activity. In the United interested persons to submit comments 3.1 Any information on the nature and States buprenorphine is currently only regarding the five named drugs. Any extent of illicit activities involving the available as a parenteral product and is substance (clandestine manufacture, comments received will be considered smuggling, diversion, seizure, etc.)? marketed for the relief of moderate to by DHHS when it prepares a scientific severe pain. Buprenorphine is also and medical evaluation of these drugs. 5. TRAMADOL (INN) marketed for the treatment of pain in DHHS will forward a scientific and 1. LEGITIMATE USE OF THE SUBSTANCE several other countries in both medical evaluation of these drugs to 1.1 Is the substance currently registered as sublingual and parenteral dosage forms. WHO, through the Secretary of State, for a medical product? (Yes/No) A high-dose formulation of WHO’s consideration in deciding Please indicate trade name(s), dosage buprenorphine is also marketed in other form(s) with strength(s) and indication(s): whether to recommend international 2. ABUSE OF THE SUBSTANCE countries for use in the treatment of control/decontrol of any of these drugs. 2.1 Is the substance abused or misused in opiate dependence. It is currently Such control could limit, among other your country? (Yes/No/No information) controlled domestically in Schedule V things, the manufacture and distribution 2.2 If yes, any information on the extent of of the CSA as a narcotic and is (import/export) of these drugs and could abuse? controlled internationally in Schedule impose certain recordkeeping 2.3 Any information on the extent of public III of the Psychotropic Convention. In requirements on them. health or social problems associated with the the Federal Register of March 21, 2002 DHHS will not now make any abuse of the substance (statistics on cases of (67 FR 13114), the Drug Enforcement recommendations to WHO regarding overdose deaths, dependence, etc.)? 3. ILLICIT ACTIVITIES INVOLVING THE Administration published a proposed whether any of these drugs should be SUBSTANCE rule to increase the regulatory controls subjected to international controls. 3.1 Any information on the nature and placed on buprenorphine by Instead, DHHS will defer such extent of illicit activities involving the rescheduling buprenorphine from a consideration until WHO has made Schedule V narcotic to a Schedule III official recommendations to the 3 Including dronabinol (INN) narcotic. Commission on Narcotic Drugs, which VerDate 11 are expected to be made in late 2002. MD 21703, 301–619–7078, FAX 301– meeting is to provide the general public Any DHHS position regarding 698–6188, e-mail: the opportunity to hear speakers from international control of these drugs will [email protected]. the agency, industry, and others to be preceded by another Federal Register Registration: Preregistration is provide information on the issue of notice soliciting public comments as required and must be completed by antimicrobial resistance so the public required by section 201(d)(2)(B) of the April 12, 2002. Contact Kerry Davis (see can fully participate in the public CSA. ‘‘Contact’’ for address) for information dialogue about the issue. Attendees will about registration, including registration be invited to ask questions during the IV. Comments fees. Seating is limited. meeting. Interested persons may submit to the If you need special accommodations Date and Time: The meeting will be Dockets Management Branch (address due to a disability, please contact Kerry held on April 26, 2002, from 9:30 a.m. above) written or electronic comments Davis at least 7 days in advance of the to 4:30 p.m. Walk-in registration will regarding the drugs by May 9, 2002. meeting. begin at 9 a.m. You may submit written This abbreviated comment period is Transcripts: You may request public or electronic comments at any time, but necessary to allow sufficient time to workshop transcripts in writing from in order for your comments to be prepare and submit the domestic the Freedom of Information Office (HFI– included with others in conjunction information package by the deadline 35), Food and Drug Administration, with this meeting, please submit imposed by WHO. Two copies of any 5600 Fishers Lane, rm. 12A–16, comments no later than 180 days after comments are to be submitted, except Rockville, MD 20857. The transcripts the meeting. Please include the Docket that individuals may submit one copy. will be available approximately 15 No. 02N–0037 on your comments. Comments are to be identified with the working days after the meeting at the Addresses: The meeting will be held docket number found in brackets in the cost of 10 cents per page. The public at the Capital Hilton Hotel, heading of this document. Received workshop transcript will also be Congressional Room, 1001 16th St. (16th comments may be seen in the Dockets available on the Internet at http:// and K Sts.), Washington, DC, 202–393– Management Branch between 9 a.m. and www.fda.gov/cber/minutes/workshop- 1000. Submit written comments to the 4 p.m., Monday through Friday. min.htm Dockets Management Branch (HFA– 305), Food and Drug Administration, Dated: March 29, 2002. SUPPLEMENTARY INFORMATION: CBER, in 5630 Fishers Lane, rm. 1061, Rockville, Margaret M. Dotzel, cooperation with DoD, is holding a MD 20852. Submit electronic comments Associate Commissioner for Policy. public workshop entitled ‘‘Anthrax to http://www.fda.gov/dockets/ [FR Doc. 02–8493 Filed 4–8–02; 8:45 am] Vaccines: Efficacy Testing and Surrogate ecomments. Comments should be BILLING CODE 4160–01–S Markers of Immunity.’’ The workshop identified with the full title and the will discuss: (1) Pathogenesis of Bacillus Docket No. 02N–0037 on your anthracis, (2) animal models of anthrax, comments. DEPARTMENT OF HEALTH AND (3) immunogenicity data available from For General Information Contact: HUMAN SERVICES human clinical trials of anthrax Vash Klein, Center for Veterinary vaccines, and (4) identification of Medicine (CVM) (HFV–12), Food and Food and Drug Administration surrogate markers and possible Drug Administration, 7519 Standish Pl., strategies. The workshop’s goal is to Rockville, MD 20855, e-mail: Anthrax Vaccines: Efficacy Testing expedite the development of anthrax [email protected]. and Surrogate Markers of Immunity; vaccines by providing additional For Information About Registration Public Workshop information about efficacy testing of Contact: Ben Horsley, The Shipley AGENCY: Food and Drug Administration, these vaccines. Group, at 888–270–2157, FAX 888–270– HHS. Dated: March 29, 2002. 2158. ACTION: Notice of public workshop. Margaret M. Dotzel, Registration: Registration is required. There is no registration fee for the Associate Commissioner for Policy. The Food and Drug Administration meeting. Limited space is available, and [FR Doc. 02–8463 Filed 4–8–02; 8:45 am] (FDA), Center for Biologics Evaluation early registration is encouraged. and Research (CBER), in cooperation BILLING CODE 4160–01–S Information about the meeting and the with the Department of Defense (DoD), registration form are available on the is announcing the following public DEPARTMENT OF HEALTH AND Internet at www.fda.gov/cvm, click on workshop: ‘‘Anthrax Vaccines: Efficacy HUMAN SERVICES Antimicrobial Resistance, then scroll Testing and Surrogate Markers of down to PUBLIC MEETINGS, April 26, Immunity.’’ The workshop will discuss Food and Drug Administration 2002 — Consumer Meeting on possible strategies for the efficacy Antimicrobial Resistance. Please mail or testing of investigational anthrax [Docket No. 02N–0037] fax the registration form to: FDA/CVM Enrollments —The Shipley Group, Inc., vaccines. Public Informational Meeting on 1584 South 500 West, suite 201, Woods Date and Time: The public workshop Antimicrobial Resistance will be held on April 23, 2002, from 8 Cross, UT 84087; Ben Horsley at 888– a.m. to 5 p.m. AGENCY: Food and Drug Administration, 270–2157 or 801– 298–7800, FAX 888– Location: The public workshop will HHS. 270–2158 or 801–298–7820. Additional be held at the Jay P. Sanford Auditorium ACTION: Notice of meeting; request for information about the meeting and the on the campus of the Uniformed comments. agenda will be available on the Internet Services University of Health Sciences (www.fda.gov/cvm) before the meeting. (USUHS), 4301 Jones Bridge Rd., SUMMARY: The Food and Drug Oral Presentations: Please submit Bethesda, MD 20814. Administration (FDA) is announcing the requests for oral presentations by April Contact: Kerry Davis, Science following meeting: ‘‘Public 22, 2002, to FDA/CVM, Attn: Consumer Applications International Corp. (SAIC), Informational Meeting on Antimicrobial Meeting, Docket No. 02N–0037, 7500 5340 Spectrum Dr., suite N, Frederick, Resistance.’’ The purpose of this public Standish Pl., (HFV–12), rm. 3503, VerDate 11 Rockville, MD 20855. All presentations Manufacturers Assistance (HFM–40), HCV nucleic acid testing within 6 may be provided on Powerpoint (disk or Center for Biologics Evaluation and months of issuance of a final guidance. CD, or e-mailed in advance to Research (CBER), Food and Drug The draft guidance specifies how you [email protected]). No zip disks, Administration, 1401 Rockville Pike, should notify FDA of such slide presentations, or overheads can be Rockville, MD 20852–1448. Send one implementation as required under 21 accommodated. self-addressed adhesive label to assist CFR 601.12. If you need special accommodations the office in processing your requests. This draft guidance is being issued due to a disability, please contact Vash The document may also be obtained by Klein at least 7 days in advance. mail by calling the CBER Voice consistent with FDA’s good guidance Information System at 1–800–835–4709 practices regulation (21 CFR 10.115). Dated: April 4, 2002. This draft guidance document Margaret M. Dotzel, or 301–827–1800, or by fax by calling the FAX Information System at 1–888– represents the agency’s current thinking Associate Commissioner for Policy. CBER–FAX or 301–827–3844. See the on this topic. It does not create or confer [FR Doc. 02–8567 Filed 4–5–02; 8:45 am] SUPPLEMENTARY INFORMATION section for any rights for or on any person and does BILLING CODE 4160–01–S electronic access to the draft guidance. not operate to bind FDA or the public. Submit written comments on the An alternative approach may be used if document to the Dockets Management such approach satisfies the requirement DEPARTMENT OF HEALTH AND Branch (HFA–305), Food and Drug of the applicable statutes and HUMAN SERVICES Administration, 5630 Fishers Lane, rm. regulations. As with other guidance Food and Drug Administration 1061, Rockville, MD 20852. Submit documents, FDA does not intend this electronic comments to http:// document to be all-inclusive and [Docket No. 02D–0096] www.fda.gov/dockets/ecomments. cautions that not all information may be Draft ‘‘Guidance for Industry: Use of FOR FURTHER INFORMATION CONTACT: applicable to all situations. The Nucleic Acid Tests on Pooled and Nathaniel L. Geary, Center for Biologics document is intended to provide Individual Samples From Donors of Evaluation and Research (HFM–17), information and does not set forth Whole Blood and Blood Components Food and Drug Administration, 1401 requirements. Rockville Pike, Rockville, MD 20852– for Transfusion to Adequately and II. Comments Appropriately Reduce the Risk of 1448, 301–827–6210. Transmission of HIV–1 and HCV;’’ SUPPLEMENTARY INFORMATION: This draft document is being Availability I. Background distributed for comment purposes only and is not intended for implementation AGENCY: Food and Drug Administration, FDA is announcing the availability of at this time. Interested persons may HHS. a draft document entitled ‘‘Guidance for submit to the Dockets Management ACTION: Notice. Industry: Use of Nucleic Acid Tests on Branch (see ADDRESSES) written or Pooled and Individual Samples From SUMMARY: The Food and Drug Donors of Whole Blood and Blood electronic comments regarding this draft Administration (FDA) is announcing the Components for Transfusion to guidance document. Submit written or availability of a draft document entitled Adequately and Appropriately Reduce electronic comments to ensure adequate ‘‘Guidance for Industry: Use of Nucleic the Risk of Transmission of HIV–1 and consideration in preparation of the final Acid Tests on Pooled and Individual HCV,’’ dated March 2002. FDA’s final document by July 8, 2002. Two copies Samples From Donors of Whole Blood rule (66 FR 31146, June 11, 2001) of any written comments are to be and Blood Components for Transfusion entitled ‘‘Requirements for Testing submitted, except individuals may to Adequately and Appropriately Human Blood Donors for Evidence of submit one copy. Comments should be Reduce the Risk of Transmission of Infection Due to Communicable Disease identified with the docket number HIV–1 and HCV’’ dated March 2002. Agents’’ became effective on December found in the brackets in the heading of The draft guidance document would 10, 2001. Under 21 CFR 610.40(b), this document. A copy of the document inform all establishments that manufacturers ‘‘must perform one or and received comments are available for manufacture Whole Blood that FDA has more such [screening] tests as necessary public examination in the Dockets licensed a nucleic acid test (NAT) to to reduce adequately and appropriately Management Branch between 9 a.m. and identify human immunodeficiency virus the risk of transmission of 4 p.m., Monday through Friday. type 1 (HIV–1) and hepatitis C virus communicable disease’’ (66 FR 31146 at (HCV) in Whole Blood donations. The 31162). In the preamble to the final rule, III. Electronic Access draft document recommends that we said that the standard for adequate Persons with access to the Internet manufacturers implement licensed HIV– and appropriate testing will change as may obtain the document at http:// 1 and HCV NAT within 6 months of FDA approves new testing technology. www.fda.gov/cber/guidelines.htm or issuance of a final guidance and notify We explained that, ‘‘* * * we intend to http://www/fda.gov/ohrms/dockets/ FDA of such implementation by regularly issue guidance describing specified procedures. those tests that we believe would default.htm. DATES: Submit written or electronic adequately and appropriately reduce the Dated: March 29, 2002. comments on the draft guidance to risk of transmission of communicable Margaret M. Dotzel, ensure their adequate consideration in disease agents’’ (66 FR 31146 at 31149). Associate Commissioner for Policy. preparation of the final document by The availability of NAT to identify [FR Doc. 02–8464 Filed 4–8–02; 8:45 am] July 8, 2002. General comments on HIV–1 and HCV will change the testing agency guidance documents are protocol for adequately and BILLING CODE 4160–01–S welcome at any time. appropriately reducing the risk of ADDRESSES: Submit written requests for transmission of those diseases. The draft single copies of the draft guidance to the document recommends that Office of Communication, Training, and manufacturers implement HIV–1 and VerDate 11 DEPARTMENT OF HEALTH AND FOR FURTHER INFORMATION CONTACT: /www.fda.gov/cder/guidance/index.htm HUMAN SERVICES Grant A. Williams, Center for Drug or http://www.fda.gov/cber/ Evaluation and Research (HFD–150), guidelines.htm or http://www.fda.gov/ Food and Drug Administration Food and Drug Administration, 5600 ohrms/dockets/default.htm. [Docket No. 02D–0094] Fishers Lane, Rockville, MD 20857, Dated: March 29, 2002. 301–594–5740, or Patricia Keegan, Margaret M. Dotzel, Center for Biologics Evaluation and Draft Guidance for Industry on IND Associate Commissioner for Policy. Exemptions for Studies of Lawfully Research (HFM–573), Food and Drug [FR Doc. 02–8462 Filed 4–8–02; 8:45 am] Marketed Cancer Drug or Biological Administration, 1401 Rockville Pike, Products; Availability Rockville, MD 20852, 301–827–5093. BILLING CODE 4160–01–S SUPPLEMENTARY INFORMATION: AGENCY: Food and Drug Administration, HHS. I. Background DEPARTMENT OF HEALTH AND HUMAN SERVICES ACTION: Notice. FDA is announcing the availability of a draft guidance for industry entitled Health Resources and Services SUMMARY: The Food and Drug ‘‘IND Exemptions for Studies of Administration Administration (FDA) is announcing the Lawfully Marketed Cancer Drug or availability of a draft guidance for Biological Drug Products.’’ Exemption Fiscal Year 2002 Competitive industry entitled ‘‘IND Exemptions for of certain studies of marketed drugs Application Cycle for the Nursing Studies of Lawfully Marketed Cancer from IND regulation is allowed under 21 Education Loan Repayment Program Drug or Biological Products.’’ This CFR 312.2(b)(1). Investigations that 93.908 guidance clarifies FDA’s policy on involve a route of administration or exemption from investigational new dosage level or use in a patient AGENCY: Health Resources and Services drug (IND) application requirements for population or other factor that Administration. studies of marketed cancer drug or significantly increases the risks (or ACTION: Notice. biological products. This guidance is decreases the acceptability of the risks) intended to decrease the burden to associated with the use of the drug SUMMARY: The Health Resources and investigators and regulators of product are not exempt. This guidance Services Administration (HRSA) submitting unnecessary IND discusses the risk/benefit determination announces that applications will be applications. in the practice of oncology, the accepted for the Nursing Education Loan Repayment Program (NELRP) for DATES: Submit written or electronic pertinent regulations relating to exemption of INDs, FDA’s policy for Fiscal Year 2002. comments on the draft guidance by June Authorizing Legislation: These 10, 2002. General comments on agency determining exemption status, and specific examples of studies generally applications are solicited under section guidance documents are welcome at any 846 of the Public Health Service (PHS) time. considered exempt. This level 1 draft guidance is being Act, as amended, which authorizes loan ADDRESSES: Submit written requests for issued consistent with FDA’s good repayment, in the amount of 30 percent single copies of the draft guidance to the guidance practices regulation (21 CFR of the outstanding principal and interest Drug Information Branch (HFD–210), 10.115). The draft guidance, when on nursing education loans for each of Center for Drug Evaluation and finalized, will represent the agency’s the first two years of full-time nursing Research, Food and Drug current thinking on IND exemptions for service completed in an eligible health Administration, 5600 Fishers Lane, studies of lawfully marketed cancer facility, and 25 percent for a third year Rockville, MD 20857, http:// drug or biological products. It does not of service completed. www.fda.gov/cder/guidance/index.htm, create or confer any rights for or on any Eligible Applicants: An individual is or the Office of Communication, person and does not operate to bind eligible to apply for NELRP if the Training, and Manufacturers Assistance FDA or the public. An alternative individual: (1) Has received a (HFM–40), Center for Biologics approach may be used if such approach baccalaureate or associate degree in Evaluation and Research, Food and satisfies the requirements of the nursing, a diploma in nursing, or a Drug Administration, 1401 Rockville applicable statutes and regulations. graduate degree in nursing; (2) has Pike, Rockville, MD 20852–1448, http:/ obtained one or more nursing student /www.fda.gov/cber/guidelines.htm. II. Comments loans authorized under section 835(a) of Send one self-addressed adhesive label Interested persons may submit to the the PHS Act, as amended, or any other to assist the office in processing your Dockets Management Branch (address educational loan for nurse training requests. The document may also be above) written or electronic comments costs; (3) enters into an agreement to obtained by mail by calling the CBER on the draft guidance. Two copies of serve as a full-time registered or Voice Information System at 1–800– any comments are to be submitted, advanced practice nurse for a period of 835–4709 or 301–827–1800, or by except that individuals may submit one not less than two years in an eligible calling the Fax Information System at 1– copy. Comments are to be identified health facility; and (4) is a U.S. citizen, 888–CBER–FAX or 301–827–3844. with the docket number found in U.S. national, or a permanent legal Submit written or electronic comments brackets in the heading of this resident of the United States. on the draft guidance to the Dockets document. The draft guidance and An ‘‘eligible health facility’’ is defined Management Branch (HFA–305), Food received comments are available for as: (1) An Indian Health Service health and Drug Administration, 5630 Fishers public examination in the Dockets center; (2) a Native Hawaiian health Lane, rm. 1061, Rockville, MD 20852. Management Branch between 9 a.m. and center; (3) a public hospital (operated by Submit electronic comments to http:// 4 p.m., Monday through Friday. a State, county, or local government); (4) www.fda.gov/dockets/ecomments. See a health center funded under section the SUPPLEMENTARY INFORMATION section III. Electronic Access 330 of the PHS Act (including for electronic access to the draft Persons with access to the Internet community, migrant, homeless, and guidance document. may obtain the document at either http:/ public housing centers); (5) a rural VerDate 11 health clinic under Section 1861(aa)(2) page. Instructions for submitting DEPARTMENT OF HEALTH AND of the Social Security Act; or (6) a applications electronically will also be HUMAN SERVICES public or nonprofit private health available on the Web. Application facility determined by the Secretary to guidance will be available for Administration for Children and have a critical shortage of nurses. downloading via the Web on April 9, Families For Fiscal Year 2002, the Secretary 2002. Applicants who register online has defined health facilities with a Refugee Resettlement Program: will automatically be sent information Proposed Notice of Allocations to critical shortage of nurses as any public regarding the application guidance and/ or nonprofit private health facility: (1) States of FY 2002 Funds for Refugee or lists of eligible health facilities, nurse On the NELRP’s Fiscal Year 2002 list of Social Services shortage counties, and HPSAs. facilities with a critical shortage of Applicants may also request a hard copy AGENCY: Office of Refugee Resettlement nurses; (2) located in a county on the (ORR), ACF, HHS. NELRP’s Fiscal Year 2002 list of of the application materials and/or lists ACTION: Proposed notice of allocations to counties with a shortage of nurses; (3) of eligible health facilities, nurse States of FY 2002 funds for refugee located in a currently designated whole shortage counties, and HPSAs by calling social services. county health professional shortage area (866) 813–3753. (HPSA) or (4) classified as one of the In order to be considered, SUMMARY: This notice establishes the following regardless of its location: a applications for loan repayment must be proposed allocations to States of FY public health department, nursing home submitted to the Division of Nursing 2002 funds for social services under the or rehabilitation center. (NELRP), Bureau of Health Professions, Refugee Resettlement Program (RRP). In Funding Preference: A funding HRSA, Room 9–36, Parklawn Building, the final notice, amounts could be preference is defined as the funding of 5600 Fishers Lane, Rockville, MD adjusted slightly based on final a specific category or group of approved 20857. Applications must be adjustments in FY 2001 arrivals in some applicants ahead of other categories or postmarked by June 14, 2002. States. groups of applicants. The following Applications postmarked after the DATES: Comments on this notice must be preferences apply to the NELRP received by May 9, 2002. applicants: deadline date or sent to any address A. As provided in section 846(e) of other than the Rockville, Maryland ADDRESSES: Address written comments, the PHS Act, as amended, first address may be returned to the in duplicate, to: Barbara R. Chesnik, preference will be given to qualified applicant and not processed. Office of Refugee Resettlement, Administration for Children and applicants with the greatest financial FOR FURTHER INFORMATION CONTACT: Ms. need who agree to serve in eligible Families, 370 L’Enfant Promenade, SW., Jacqueline Brown, e-mail at Washington, DC 20447. Due to delays in health facilities located in a county on [email protected]; Ms. Leola Bennett, e- the NELRP’s Fiscal Year 2002 list of mail delivery to Federal offices, a copy mail at [email protected]; or Ms. Robin of comments should also be faxed to: counties with a shortage of nurses. Ingram, e-mail at [email protected], Applicants whose total qualifying (202) 401–5487. loans are 40% or greater of their Division of Nursing, Bureau of Health FOR FURTHER INFORMATION CONTACT: annualized salary will meet the greatest Professions, HRSA, Room 9–36, Barbara R. Chesnik, Division of Refugee financial need requirement of the Parklawn Building, 5600 Fishers Lane, Self-Sufficiency, telephone: (202) 401– funding preference. Rockville, Maryland 20857. Central 4558, e-mail: [email protected]. B. Remaining funds will be awarded telephone is (301) 443–3232. Fax SUPPLEMENTARY INFORMATION: in the following order: (1) To qualified number is (301)443–0791. I. Amounts For Allocation applicants who are employed at an Paperwork Reduction Act: The eligible health facility located in a Application for Nursing Education Loan The Office of Refugee Resettlement county with a shortage of nurses Repayment Program has been approved (ORR) has available $158,600,000 in FY regardless of the applicant’s financial by the Office of Management and 2002 refugee social service funds as part of the FY 2002 appropriation for the need; (2) to qualified applicants Budget (OMB) under the Paperwork Department of Health and Human employed at an eligible health facility Reduction Act. The OMB clearance Services (Departments of Labor, Health not located in a county with a shortage number is 0915–0140. of nurses who demonstrate greatest and Human Services, and Education, financial need; and (3) other qualified The program is not subject to the and Related Agencies Appropriations applicants who are serving in States that provision of Executive Order 12372, Act, 2002, Pub. L. No. 107–116). received few or no new NELRP Intergovernmental Review of Federal The FY 2002 House Appropriations participants. Programs (as implemented through 45 Committee Report (H.R. Rept. No. 107– Estimated Amount of Available CFR part 100). This program is also not 229) reads as follows with respect to Funds: Up to $8,000,000 will be subject to the Public Health Systems social services funds: available in Fiscal Year 2002 for this Reporting Requirements. The bill provides $158,621,000 for social program. Dated: March 29, 2002. services, $15,000,000 more than the fiscal Estimated Number of Awards: It is year 2001 appropriation and the budget estimated that 445 Loan Repayment Elizabeth M. Duke, request. Funds are distributed by formula as Contracts will be awarded in Fiscal Year Administrator. well as through the discretionary grant 2002 for this program. [FR Doc. 02–8496 Filed 4–8–02; 8:45 am] making process for special projects. The bill includes $15,000,000 to increase educational Application Requests, Availability, BILLING CODE 4165–15–P Dates and Addresses: Applicants may support to schools with a significant proportion of refugee children, consistent register online at http://bhpr.hrsa.gov/ with previous support to schools heavily nursing for application guidance and/or impacted by large concentration of refugees. lists of eligible health facilities, nurse The Committee agrees that $19,000,000 is shortage counties, and HPSAs by available for assistance to serve communities following the instructions on the Web affected by the Cuban and Haitian entrants VerDate 11 and refugees whose arrivals in recent years • $14,000,000 will be awarded to address under the floor formula is $100,000); (b) have increased. The Committee has set aside the needs of refugees and communities if this calculation has yielded less than $26,000,000 for increased support to impacted by recent changes in Federal $75,000, a base amount of $75,000 is communities with large concentrations of assistance programs relating to welfare provided for the State. refugees whose cultural differences make reform. Awards will be made through a assimilation especially difficult justifying a separate announcement. Population To Be Served and Allowable more intense level and longer duration of • $15,000,000 will be awarded to increase Services Federal assistance. Finally, the Committee educational support to schools with a has set aside $14,000,000 to address the significant proportion of refugee children, Eligibility for refugee social services needs of refugees and communities impacted consistent with previous support to schools includes persons who meet all by recent changes in Federal assistance heavily impacted by large concentrations of requirements of 45 CFR 400.43 (as programs relating to welfare reform. The refugees. New awards will be made through amended by 65 FR 15409 (March Committee urges ORR to assist refugees at a separate announcement. 22,2000). In addition, persons granted risk of losing, or who have lost, benefits asylum are eligible for refugee benefits including SSI, TANF and Medicaid, in Refugee Social Service Funds obtaining citizenship. and services from the date that asylum The population figures for the formula was granted (See ORR State Letter No. The FY 2002 Conference Report on social services allocation include 00–12, effective June 15, 2000). Victims Appropriations (H.R. Conf. 107–342) refugees, Cuban/Haitian entrants, and of a severe form of trafficking who have reads as follows concerning social Amerasians from Vietnam. (A State received a certification or eligibility services: must, however, have an approved State letter from ORR are eligible from the plan for the Cuban/Haitian Entrant date on the certification letter (See ORR The conference agreement appropriates Program or indicate in its refugee $460,203,000, instead of $460,224,000 as State letter No. 01–13, May 3, 2001). proposed by the House and $445,224,000 program State plan that Cuban/Haitian Services to refugees must be provided proposed by the Senate. Within this amount, entrants will be served in order to use in accordance with the rules of 45 CFR for Social Services, the agreement provides funds on behalf of entrants as well as part 400 subpart I—Refugee Social $158,600,000 instead of $156,621,000 as refugees.) Services. Although the allocation proposed by the House and $143,621,000 as The Director is proposing to allocate formula is based on the 3-year refugee proposed by the Senate. $71,910,000 to States on the basis of population, States may provide services The conferees specify that funds for section each State’s proportion of the national to refugees who have been in the 414 of the Immigration and Nationality Act population of refugees who had been in shall be available for three fiscal years, as country up to 60 months (5 years), with proposed by the House. the U.S. three years or less as of October the exception of referral and interpreter The conference agreement includes 1, 2001 (including a floor amount for services and citizenship and $15,000,000 that is to be used under social States which have small refugee naturalization preparation services for services to increase educational support to populations). which there is no time limitation (45 schools with a significant proportion of The use of the 3-year population base CFR 400 152(b)). On December 5, 2001, refugee children, consistent with language in the allocation formula is required by however, the Director of ORR issued a contained in the House report. section 412(c)(1)(B) of the Immigration blanket waiver of the time-in-country The agreement also includes $19,000,000 and Nationality Act (INA) which states for increased support to communities with limit for services (ORR State Letter 01– large concentrations of refugees whose that the ‘‘funds available for a fiscal year 31). This waiver, in effect until cultural differences make assimilation for grants and contracts [for social September 30, 2002, was issued to assist especially difficult justifying a more intense services] . . . shall be allocated among States in providing services to refugees level and longer duration of Federal the States based on the total number of following the events of September 11, assistance, consistent with language refugees (including children and adults) 2001 and the subsequent cessation of contained in the House report. who arrived in the United States not refugee arrivals during most of the first ORR proposes to use the $158,600,000 more than 36 months before the quarter, FY 2002. appropriated for FY 2002 social services beginning of such fiscal year and who Allowable social services are those as follows: are actually residing in each State indicated in 45 CFR 400.154 and (taking into account secondary • $71,910,000 will be allocated under the 400.155. Additional services not 3-year population formula, as set forth in this migration) as of the beginning of the included in these sections which the notice for the purpose of providing fiscal year.’’ State may wish to provide must be employment services and other needed As established in the FY 1991 social submitted to and approved by the services to refugees. services notice published in the Federal Director of ORR (§ 400.155(h)). • $12,690,000 will be awarded as new and Register of August 29, 1991, section I, continuation social service discretionary ‘‘Allocation Amounts’’ (56 FR 42745), a Service Priorities grants under new and prior year competitive variable floor amount for States which Priorities for provision of services are grant announcements issued separately from have small refugee populations is specified in 45 CFR 400.147. In order for this notice. refugees to move quickly off Temporary • $19,000,000 will be awarded to serve calculated as follows: If the application communities most heavily affected by recent of the regular allocation formula yields Assistance for Needy Families (TANF), Cuban and Haitian entrant and refugee less than $100,000, then— States should, to the extent possible, arrivals. These funds will be awarded (1) a base amount of $75,000 is ensure that all newly arriving refugees through continuation awards under a provided for a State with a population receive refugee-specific services separate prior year announcement. of 50 or fewer refugees who have been designed to address the employment • $26,000,000 will be awarded through in the U.S. 3 years or less; and barriers that refugees typically face. discretionary grants for communities with (2) for a State with more than 50 We encourage States to re-examine large concentrations of refugees whose refugees who have been in the U.S. 3 the range of services they currently offer cultural differences make assimilation years or less: (a) A floor has been to refugees. Those States that have had especially difficult justifying a more intense level and longer duration of Federal calculated consisting of $50,000 plus success in helping refugees achieve assistance. A combination of new and the regular per capita allocation for early employment may find it to be a continuation awards will be made through refugees above 50 up to a total of good time to expand beyond provision new and prior year separate announcements. $100,000 (in other words, the maximum of basic employment services and VerDate 11 address the broader needs that refugees adjusted for estimated secondary reconsider its numbers, it should submit have in order to enhance their ability to migration. written evidence to ORR, including a maintain financial security and to The calculation above yields the list of refugees identified by name, alien successfully integrate into the formula allocation for each State. number, date of birth, and date of community. Other States may need to Minimum allocations for small States arrival. Listing of refugees who are not reassess the delivery of employment are taken into account. identified by their alien number will not be considered. Such evidence should be services in light of local economic IV. Basis of Population Estimates conditions and develop new strategies submitted separately from comments on to better serve the currently arriving The population estimates for the the proposed allocation formula no later refugee groups. proposed allocation of funds in FY 2002 than 30 days from the date of States should also be aware that ORR for the formula social service allocation publication of this notice and should be will make social services formula funds are based on data on refugee arrivals sent via overnight mail to: Loren available to pay for social services from the ORR Refugee Data System, Bussert, Division of Refugee Self-/ which are provided to refugees who adjusted as of October 1, 2001, for Sufficiency, Office of Refugee participate in Wilson/Fish projects. estimated secondary migration. The data Resettlement, 370 L’Enfant Promenade, Section 412(e)(7)(A) of the INA provides base includes refugees of all SW., Washington, DC 20447, Telephone: that: nationalities, Amerasians from Vietnam, (202) 401–4732, or as an Excel Cuban and Haitian entrants. The Secretary [of HHS] shall develop and spreadsheet or other compatible implement alternative projects for refugees For fiscal year 2002, ORR’s formula spreadsheet format as an e-mail who have been in the United States less than social service allocations for the States attachment to: [email protected] thirty-six months, under which refugees are are based on the numbers of refugees, States which have served asylees provided interim support, medical services, Amerasians, and entrants in the ORR during the past year also may submit the support [social] services, and case data base. The numbers are based upon following information in order to have management, as needed, in a manner that the arrivals during the preceding three their population estimate adjusted to encourages self-sufficiency, reduces welfare fiscal years: 1999, 2000, and 2001. dependency, and fosters greater coordination include those asylees whose asylum was The estimates of secondary migration granted within the 36 months period among the resettlement agencies and service are based on data submitted by all providers. ending September 30, 2001: (1) Alien participating States on Form ORR–11 on This provision is generally known as number, (2) date of birth; and (3) the secondary migrants who have resided in date asylum was granted. the Wilson/Fish Amendment. The the U.S. for 36 months or less, as of Department has already issued a September 30, 2001. The total migration States which have served victims of a separate notice in the Federal Register reported by each State is summed, severe form of trafficking during the with respect to applications for such yielding in- and out-migration figures past year may submit the following projects (64 FR 19793 (April 22, 1999)). and a net migration figure for each State. information in order to have their The net migration figure is applied to population estimate adjusted to include II. (Reserved for Discussion of these trafficking victims: (1) Alien Comments in Final Notice) the State’s total arrival figure, resulting in a revised population estimate. number, if available; (2) date of birth; (3) III. Allocation Formulas Estimates are developed separately for certification letter number and, (4) date on certification letter. Of the funds available for FY 2002 for refugees and entrants and then social services, $71,910,000 is proposed combined into a total estimated 3-year Please submit the above data on to be allocated to States in accordance refugee/entrant population for each asylees and trafficking victims served on with the formula specified in A. below. State. Eligible Amerasians are included separate Excel spreadsheets as an e-mail A. A State’s allowable formula in the refugee figures. Havana parolees attachment within 30 days of the allocation is calculated as follows: (HP’s) are enumerated in a separate publication date of this announcement 1. The total amount of funds column in Table 1, below, because they to: [email protected] determined by the Director to be are tabulated separately from other V. Proposed Allocation Amounts available for this purpose; divided by— entrants. Havana parolee arrivals for all 2. The total number of refugees, States are based on actual data. Funding subsequent to the Cuban/Haitian entrants, and Amerasians Table 1, below, shows the estimated publication of this notice will be from Vietnam who arrived in the United 3-year populations, as of October 1, contingent upon the submittal and States not more than 3 years prior to the 2001, of refugees (col. 1), entrants (col. approval of a State annual services plan beginning of the fiscal year for which 2), Havana parolees (col. 3); total that is developed on the basis of a local the funds are appropriated, as shown by refugee/entrant population, (col. 4); the consultative process, as required by 45 the ORR Refugee Data System. The proposed formula amounts which the CFR 400.11(b)(2) in the ORR resulting per capita amount is population estimates yield, (col. 5); and regulations. multiplied by— the proposed total allocation (col. 6). The following amounts are for 3. The number of persons in item 2, If a State does not agree with ORR’s allocation for refugee social services in above, in the State as of October 1, 2001, population estimate and wishes ORR to FY 2002: TABLE 1.—ESTIMATED THREE-YEAR REFUGEE/ENTRANT/PAROLEE POPULATIONS OF STATES PARTICIPATING IN THE REFUGEE PROGRAM AND PROPOSED SOCIAL SERVICE FORMULA AMOUNT AND ALLOCATION FOR FY 2002 Havana parol- Total popu- Proposed for- Proposed allo- State Refugees 1 Entrants ees 2 lation mula amount cation Alabama ...... 386 5 35 426 $106,915 $106,915 Alaska 3 ...... 115 0 0 115 28,862 75,000 Arizona ...... 7,201 404 2 7,607 1,909,160 1,909,160 Arkansas ...... 41 9 4 54 13,553 75,000 VerDate 11 TABLE 1.—ESTIMATED THREE-YEAR REFUGEE/ENTRANT/PAROLEE POPULATIONS OF STATES PARTICIPATING IN THE REFUGEE PROGRAM AND PROPOSED SOCIAL SERVICE FORMULA AMOUNT AND ALLOCATION FOR FY 2002—Continued Havana parol- Total popu- Proposed for- Proposed allo- State Refugees 1 Entrants ees 2 lation mula amount cation California ...... 29,077 74 238 29,389 7,375,880 7,375,880 Colorado 3 ...... 3,265 4 4 3,273 821,438 821,438 Connecticut ...... 3,075 30 34 3,139 787,808 787,808 Delaware ...... 128 15 0 143 35,889 75,000 Dist. of Columbia ...... 384 4 8 396 99,386 100,000 Florida ...... 13,412 15,246 32,725 61,383 15,405,547 15,405,547 Georgia ...... 10,348 35 110 10,493 2,633,472 2,633,472 Hawaii ...... (3) 0 0 (3) (753) 75,000 Idaho 3 ...... 2,796 1 3 2,800 702,728 702,728 Illinois ...... 9,436 15 102 9,553 2,397,556 2,397,556 Indiana ...... 1,713 6 11 1,730 434,185 434,185 Iowa ...... 3,869 0 2 3,871 971,521 971,521 Kansas ...... 614 5 4 623 156,357 156,357 Kentucky 3 ...... 3,403 1,088 8 4,499 1,129,133 1,129,133 Louisiana ...... 1,209 127 44 1,380 346,344 346,344 Maine ...... 1,109 0 0 1,109 278,330 278,330 Maryland ...... 3,734 12 20 3,766 945,169 945,169 Massachusetts 3 ...... 5,921 160 38 6,119 1,535,711 1,535,711 Michigan ...... 8,258 863 31 9,152 2,296,916 2,296,916 Minnesota ...... 13,653 6 8 13,667 3,430,064 3,430,064 Mississippi ...... 25 3 6 34 8,533 75,000 Missouri ...... 7,775 12 24 7,811 1,960,359 1,960,359 Montana ...... 1 0 4 5 1,255 75,000 Nebraska ...... 1,750 2 5 1,757 440,962 440,962 Nevada 3 ...... 1,164 752 53 1,969 494,168 494,168 New Hampshire ...... 1,724 0 0 1,724 432,679 432,679 New Jersey ...... 4,537 352 758 5,647 1,417,251 1,417,251 New Mexico ...... 458 319 2 779 195,509 195,509 New York ...... 21,394 1,149 195 22,738 5,706,650 5,706,650 North Carolina ...... 3,419 21 46 3,486 874,896 874,896 North Dakota 3 ...... 1,269 0 0 1,269 318,486 318,486 Ohio ...... 4,301 6 8 4,315 1,082,953 1,082,953 Oklahoma ...... 407 0 5 412 103,401 103,401 Oregon ...... 3,780 489 4 4,273 1,072,413 1,072,413 Pennsylvania ...... 7,970 241 47 8,258 2,072,545 2,072,545 Rhode Island ...... 781 2 7 790 198,270 198,270 South Carolina ...... 216 1 20 237 59,481 96,932 South Dakota 3 ...... 1,286 0 0 1,286 322,753 322,753 Tennessee ...... 2,995 8 38 3,041 763,212 763,212 Texas ...... 12,147 852 115 13,114 3,291,275 3,291,275 Utah ...... 3,179 2 2 3,183 798,851 798,851 Vermont ...... 884 0 0 884 221,861 221,861 Virginia ...... 5,344 92 29 5,465 1,371,574 1,371,574 Washington ...... 15,387 0 14 15,401 3,865,253 3,865,253 West Virginia ...... 18 0 0 18 4,518 75,000 Wisconsin ...... 2,057 5 4 2,066 518,513 518,513 Wyoming 4 ...... Total ...... 227,412 22,417 34,817 284,646 $71,438,792 $71,910,000 1 IncludesAmerasian immigrants. Adjusted for secondary migration. 2 For all years, Havana Parolee arrivals for all States are based on actual data. 3 The allocations for Alaska, Colorado, Idaho, Kentucky, Massachusetts, Nevada, North Dakota, South Dakota, and for San Diego County, California are expected to be awarded to Wilson/Fish projects. 4 Wyoming no longer participates in the Refugee Program. VI. Paperwork Reduction Act Dated: March 26, 2002. DEPARTMENT OF HEALTH AND Nguyen Van Hanh, HUMAN SERVICES This notice does not create any Director, Office of Refugee Resettlement. reporting or recordkeeping requirements [FR Doc. 02–8540 Filed 4–8–02; 8:45 am] Substance Abuse and Mental Health requiring OMB clearance. Services Administration BILLING CODE 4184–01–P (Catalog of Federal Domestic Assistance No. 93.566 Refugee Assistance—State Agency Information Collection Administered Programs) Activities: Proposed Collection; Comment Request In compliance with section 3506(c)(2)(A) of the Paperwork VerDate 11 Reduction Act of 1995 concerning ways to minimize the burden of the and education of children and their opportunity for public comment on collection of information on adult caregivers through materials and proposed collections of information, the respondents, including through the use community events. Substance Abuse and Mental Health of automated collection techniques or To determine the likely effectiveness Services Administration will publish other forms of information technology. of the campaign, CSAP is planning to periodic summaries of proposed Proposed Project: Evaluation of the conduct an evaluation. The evaluation projects. To request more information CSAP Underage Drinking Prevention will determine whether the campaign on the proposed projects or to obtain a Public Education Campaign—New— can produce measurable change in copy of the information collection SAMHSA’s Center for Substance Abuse communities that receive training and plans, call the SAMHSA Reports Prevention (CSAP) is launching the technical assistance on implementing Clearance Officer on (301) 443–7978. Underage Drinking Prevention Public the campaign, plus funds to customize Comments are invited on: (a) Whether Education Campaign, which is a public materials for those communities. The the proposed collections of information education campaign designed to educate evaluation will assess change in are necessary for the proper 9–13 year old children about the harms knowledge and attitudes among those performance of the functions of the of alcohol use and to support parents as exposed to the campaign. Four agency, including whether the they monitor and participate in their treatment and four comparison information shall have practical utility; children’s activities. The ultimate goal communities will be selected for study. (b) the accuracy of the agency’s estimate of the initiative is to reduce underage Data for the evaluation will be collected of the burden of the proposed collection drinking among young people. Elements through a baseline and follow-up of information; (c) ways to enhance the of the campaign include media telephone survey of adult-child dyads. quality, utility, and clarity of the messages (such as public service The estimated annual burden hours are information to be collected; and (d) announcements on television and radio) as follows: Responses Data collection instrument Number of re- per respond- Hours per re- Total annual spondents ent sponse burden (hrs.) Baseline telephone survey of random sample of adult-child dyads ...... 3,200 1 0.3 960 Follow-up telephone survey of random sample of adult-child dyads ...... 3,200 1 0.3 960 Total ...... 6,400 ...... 1,920 Send comments to Nancy Pearce, DEPARTMENT OF HEALTH AND Treatment (CSAT) announces the SAMHSA Reports Clearance Officer, HUMAN SERVICES availability of FY 2002 funds for grants Room 16–105, Parklawn Building, 5600 for the following activity. This notice is Fishers Lane, Rockville, MD 20857. Substance Abuse and Mental Health not a complete description of the Written comments should be received Services Administration activity; potential applicants must within 60 days of this notice. obtain a copy of the Guidance for Fiscal Year (FY) 2002 Funding Applicants (GFA), including Part I, Dated: April 3, 2002. Opportunities American Indian/Alaskan Native and Richard Kopanda, AGENCY: Substance Abuse and Mental Rural Community Planning Program, Executive Officer, SAMHSA. Health Services Administration, HHS. and Part II, General Policies and [FR Doc. 02–8490 Filed 4–8–02; 8:45 am] ACTION: Notice of funding availability. Procedures Applicable to all SAMHSA BILLING CODE 4162–20–P Applications for Discretionary Grants SUMMARY: The Substance Abuse and and Cooperative Agreements, before Mental Health Services Administration preparing and submitting an (SAMHSA) Center for Substance Abuse application. Est. funds FY Est. No. of Project Activity Application deadline 2002 awards period Grants Program for American Indian/Alaska Native and June 19, 2002 ...... $1,500,000 6 18 months Rural Community Planning Program. The actual amount available for the were published in the Federal Register National Clearinghouse for Alcohol and award may vary, depending on (Vol. 58, No. 126) on July 2, 1993. Drug Information (NCADI), P.O. Box unanticipated program requirements General Instructions: Applicants must 2345, Rockville, MD 20847–2345, and the number and quality of use application form PHS 5161–1 (Rev. Telephone: 1–800–729–6686. applications received. FY 2002 funds for 7/00). The application kit contains the The PHS 5161–1 application form and the activity discussed in this two-part application materials the full text of the activity are also announcement were appropriated by the (complete programmatic guidance and available electronically via SAMHSA’s Congress under Public Law No. 106– instructions for preparing and World Wide Web Home Page: http:// 310. SAMHSA’s policies and submitting applications), the PHS 5161– www.samhsa.gov. procedures for peer review and 1 which includes Standard Form 424 When requesting an application kit, Advisory Council review of grant and (Face Page), and other documentation the applicant must specify the particular cooperative agreement applications and forms. Application kits may be activity for which detailed information obtained from: is desired. All information necessary to VerDate 11 apply, including where to submit Maria Burns, CSAT/SAMHSA, Rockwall activity listed above are subject to the applications and application deadline II, Suite 740, 5600 Fishers Lane, intergovernmental review requirements instructions, are included in the Rockville, MD 20857, (301) 443–7611, of Executive Order 12372, as application kit. E-Mail: [email protected]. implemented through DHHS regulations Purpose: The Substance Abuse and For questions regarding grants at 45 CFR Part 100. E.O. 12372 sets up Mental Health Services Administration management issues, contact: a system for State and local government (SAMHSA), Center for Substance Abuse Steve Hudak, Division of Grants review of applications for Federal Treatment (CSAT) announces the Management, OPS/SAMHSA, financial assistance. Applicants (other availability of Fiscal Year 2002 funds for Rockwall II, 6th floor, 5600 Fishers than Federally recognized Indian tribal grants to support community-based Lane, Rockville, MD 20857, (301) governments) should contact the State’s planning, resulting in the development 443–9666, E-Mail: Single Point of Contact (SPOC) as early of a local substance abuse treatment [email protected] as possible to alert them to the system plan, for American Indian and prospective application(s) and to receive Public Health System Reporting Alaskan Native (AI/AN) and rural any necessary instructions on the State’s Requirements: The Public Health communities. review process. For proposed projects System Impact Statement (PHSIS) is Eligibility: Eligible applicants are serving more than one State, the intended to keep State and local health public and domestic private non-profit applicant is advised to contact the SPOC officials apprised of proposed health entities such as community based of each affected State. A current listing services grant and cooperative organizations, Tribes, Tribal of SPOCs is included in the application agreement applications submitted by governments, or other tribal authorities, guidance materials. The SPOC should community-based nongovernmental colleges and universities (including send any State review process organizations within their jurisdictions. Tribal colleges and universities), faith- recommendations directly to: Community-based nongovernmental based organizations, provider and Division of Extramural Activities, service providers who are not consumer groups and health care Policy, and Review, Substance Abuse transmitting their applications through organizations. Applicants must propose and Mental Health Services the State must submit a PHSIS to the to serve Rural Communities or Administration, Parklawn Building, head(s) of the appropriate State and American Indian or Alaska Native Room 17–89, 5600 Fishers Lane, local health agencies in the area(s) to be communities (including urban tribal Rockville, Maryland 20857. affected not later than the pertinent communities). In compliance with the The due date for State review process receipt date for applications. This legislative authority for this program recommendations is no later than 60 PHSIS consists of the following (Sec. 509 of the Public Health Service days after the specified deadline date for information: Act), for-profit organizations are not the receipt of applications. SAMHSA a. A copy of the face page of the does not guarantee to accommodate or eligible. application (Standard form 424). Availability of Funds: Approximately explain SPOC comments that are b. A summary of the project (PHSIS), received after the 60-day cut-off. $1,500,000 will be available to fund not to exceed one page, which provides: approximately 6 grants. Applicants may (1) A description of the population to Dated: April 3, 2002. request up to but not more that $250,000 be served. Richard Kopanda, in total project costs (direct and (2) A summary of the services to be Executive Officer, SAMHSA. indirect) for the entire project period. provided. [FR Doc. 02–8494 Filed 4–8–02; 8:45 am] Period of Support: Grants will be (3) A description of the coordination BILLING CODE 4162–20–P awarded for a project period of up to 18 planned with the appropriate State or months. local health agencies. Criteria for Review and Funding: State and local governments and DEPARTMENT OF HEALTH AND General Review Criteria: Competing Indian Tribal Authority applicants are HUMAN SERVICES applications requesting funding under not subject to the Public Health System this activity will be reviewed for Reporting Requirements. Application Substance Abuse and Mental Health technical merit in accordance with guidance materials will specify if a Services Administration established PHS/SAMHSA peer review particular FY 2002 activity is subject to procedures. Review criteria that will be the Public Health System Reporting Funding Opportunities Notice for the used by the peer review groups are Requirements. Community Action Grants for Service specified in the application guidance PHS Non-use of Tobacco Policy System Change, May 10, 2002 material. Statement: The PHS strongly encourages Application Date Award Criteria for Scored all grant and contract recipients to AGENCY: Center for Mental Health Applications: Applications will be provide a smoke-free workplace and Services (CMHS), Substance Abuse and considered for funding on the basis of promote the non-use of all tobacco Mental Health Services Administration their overall technical merit as products. In addition, Public Law 103– (SAMHSA), DHHS. determined through the peer review 227, the Pro-Children Act of 1994, ACTION: Modification/Clarification of a group and the appropriate National prohibits smoking in certain facilities notice of funding availability regarding Advisory Council review process. (or in some cases, any portion of a the Substance Abuse and Mental Health Availability of funds will also be an facility) in which regular or routine Services Administration, Center for award criteria. Additional award criteria education, library, day care, health care, Mental Health Services, Community specific to the programmatic activity or early childhood development Action Grants for Service System may be included in the application services are provided to children. This Change. guidance materials. is consistent with the PHS mission to Catalog of Federal Domestic protect and advance the physical and SUMMARY: This notice is to inform the Assistance Number: 93.243. mental health of the American people. public that the SAMHSA/CMHS Program Contact: For questions Executive Order 12372: Applications announcement No. PA00–003, concerning program issues, contact: submitted in response to the FY 2002 Community Action Grants for Service VerDate 11 System Change (Short Title: Community adults with serious mental illness, and ACTION: Notice of funding availability. Action Grants) will have only one those with co-occurring disorders. application receipt date on May 10, Awards range from a minimum of SUMMARY: The Substance Abuse and 2002. Awards will be made in $50,000 to a maximum of $150,000 in Mental Health Services Administration September 2002. Consistent with total costs. (SAMHSA) Center for Substance Abuse SAMHSA policy for all grants and Program Contact: For questions Treatment (CSAT) announces the applications, scored applications that concerning program issues, contact: availability of FY 2002 funds for grants David Morrissette, DSW, Community are not funded in September 2002 will for the following activity. This notice is Support Program, Suite 11C–22, 5600 be held for consideration for one year, not a complete description of the Fishers Lane, Rockville, MD 20857, should funding become available in FY activity; potential applicants must 2003. Sponsors of exemplary practices 301–443–3653, Fax 301–443–0541, E- mail: [email protected]. obtain a copy of the Guidance for who are considering applying for a grant Applicants (GFA), including Part I, through the standing announcement for Dated: April 2, 2002. Development of Comprehensive Drug/ one of the subsequent receipt dates Chuck Novak, Alcohol and Mental Health Treatment should note that the President’s FY03 Acting Executive Officer, SAMHSA. Systems for Persons Who Are Homeless, Budget proposes no funds for new [FR Doc. 02–8393 Filed 4–8–02; 8:45 am] awards during FY03. Should and Part II, General Policies and BILLING CODE 4162–20–P Community Action Grant funding Procedures Applicable to all SAMHSA become available, a new announcement Applications for Discretionary Grants and Cooperative Agreements, before will be published. Check the Federal DEPARTMENT OF HEALTH AND preparing and submitting an Register and/or the SAMHSA Web site HUMAN SERVICES for notice of the announcement at http:/ application. /www.samhsa.gov/. Substance Abuse and Mental Health Community Action Grants for Service Services Administration Systems Change support the adoption Fiscal Year (FY) 2002 Funding and implementation of exemplary Opportunities practices related to the delivery and organization of services for children AGENCY: Substance Abuse and Mental with serious emotional disturbance or Health Services Administration, HHS. Project pe- Activity Application deadline Est. funds FY Est. No. of awards riod 2002 years Grants Program to Develop, Comprehensive Drug/Alco- June 19, 2002 ...... $9,000,000 15–17 3 hol and, Mental Health Treatment Systems for, Per- sons Who Are Homeless. The actual amount available for the The PHS 5161–1 application form and community and would include tribal award may vary, depending on the full text of the activity are also and local governments that provide unanticipated program requirements available electronically via SAMHSA’s community-based services. Private and the number and quality of World Wide Web Home Page: http:// nonprofit entities include community- applications received. FY 2002 funds for www.samhsa.gov. based and faith-based organizations. the activity discussed in this When requesting an application kit, States are not eligible to apply. The announcement were appropriated by the the applicant must specify the particular applicant agency and all direct Congress under Public Law No. 106– activity for which detailed information providers of substance abuse and mental is desired. All information necessary to 310. SAMHSA’s policies and health services involved in the proposed apply, including where to submit procedures for peer review and system must be in compliance with all Advisory Council review of grant and applications and application deadline local, city, county and/or State cooperative agreement applications instructions, are included in the requirements for licensing, were published in the Federal Register application kit. (Vol. 58, No. 126) on July 2, 1993. Purpose: The Substance Abuse and accreditation, or certification. The General Instructions: Applicants must Mental Health Services Administration applicant, if a direct provider of use application form PHS 5161–1 (Rev. (SAMHSA), Center for Substance Abuse substance abuse treatment or mental 7/00). The application kit contains the Treatment (CSAT) announces the health services, and any direct providers two-part application materials availability of fiscal year 2002 funds for of substance abuse treatment or mental (complete programmatic guidance and grants to enable communities to expand health services involved in the proposed instructions for preparing and and strengthen their treatment services system, must have been providing submitting applications), the PHS 5161– for homeless individuals with substance treatment services for a minimum of two 1 which includes Standard Form 424 abuse disorders, mental illness, or with years prior to the date of the (Face Page), and other documentation co-occurring substance abuse disorders application. If the applicant is not a and forms. Application kits may be and mental illness. direct provider of substance abuse obtained from: Eligibility: Pursuant to Section 506 of treatment or mental health services, the National Clearinghouse for Alcohol and the Public Health Service Act, eligible applicant must document a commitment entities are community-based public Drug Information (NCADI), from a substance abuse treatment or and private nonprofit entities. P.O. Box 2345, mental health provider to participate in Rockville, MD 20847–2345, Community-based public entities are Telephone: 1–800–729–6686. those public entities located in the the proposed project. VerDate 11 Availability of Funds: Approximately PHSIS consists of the following days after the specified deadline date for $9.0 million will be available to fund 15 information: the receipt of applications. SAMHSA to 17 grants. The average award is a. A copy of the face page of the does not guarantee to accommodate or expected to range from $450,000 to application (Standard form 424). explain SPOC comments that are $600,000 per year in total costs (direct b. A summary of the project (PHSIS), received after the 60-day cut-off. and indirect). Annual awards will be not to exceed one page, which provides: (1) A description of the population to Dated: April 3, 2002. made subject to continued availability Richard Kopanda, of funds and progress achieved by the be served. Executive Officer, SAMHSA. grantee. (2) A summary of the services to be Period of Support: Grants will be provided. [FR Doc. 02–8495 Filed 4–8–02; 8:45 am] (3) A description of the coordination awarded for a period of up to 3 years. BILLING CODE 4162–20–P planned with the appropriate State or Criteria for Review and Funding local health agencies. State and local governments and General Review Criteria: Competing DEPARTMENT OF HOUSING AND Indian Tribal Authority applicants are applications requesting funding under URBAN DEVELOPMENT not subject to the Public Health System this activity will be reviewed for Reporting Requirements. Application [Docket No. FR–4739–N–10 technical merit in accordance with guidance materials will specify if a established PHS/SAMHSA peer review particular FY 2002 activity is subject to Notice of Proposed Information procedures. Review criteria that will be the Public Health System Reporting Collection: Comment Request; Section used by the peer review groups are Requirements. 248 Single Family Mortgage Insurance specified in the application guidance PHS Non-use of Tobacco Policy on Indian Reservations and Other material. Statement: The PHS strongly encourages Restricted Lands Award Criteria for Scored all grant and contract recipients to AGENCY: Applications: Applications will be Office of the Assistant provide a smoke-free workplace and Secretary for Housing—Federal Housing considered for funding on the basis of promote the non-use of all tobacco their overall technical merit as Commissioner, HUD. products. In addition, Public Law 103– ACTION: Notice. determined through the peer review 227, the Pro-Children Act of 1994, group and the appropriate National prohibits smoking in certain facilities SUMMARY: The proposed information Advisory Council review process. (or in some cases, any portion of a collection requirement described below Availability of funds will also be an facility) in which regular or routine will be submitted to the Office of award criteria. Additional award criteria education, library, day care, health care, Management and Budget (OMB) for specific to the programmatic activity or early childhood development review, as required by the Paperwork may be included in the application services are provided to children. This Reduction Act. The Department is guidance materials. is consistent with the PHS mission to soliciting public comments on the Catalog of Federal Domestic protect and advance the physical and subject proposal. Assistance Number: 93.243. mental health of the American people. DATES: Comments Due Date: June 10, Program Contact: For questions Executive Order 12372: Applications 2002. concerning program issues, contact: submitted in response to the FY 2002 Joanne C. Gampel, M.A., CSAT/ activity listed above are subject to the ADDRESSES: Interested persons are SAMHSA, Rockwall II, 7th Floor, intergovernmental review requirements invited to submit comments regarding 5600 Fishers Lane, Rockville, MD of Executive Order 12372, as this proposal. Comments should refer to 20857, (301) 443–7945, E-Mail: implemented through DHHS regulations the proposal by name and/or OMB [email protected]. at 45 CFR Part 100. E.O. 12372 sets up Control Number and should be sent to: For questions regarding grants a system for State and local government Wayne Eddins, Reports Management management issues, contact: review of applications for Federal Officer, Department of Housing and Steve Hudak, Division of Grants financial assistance. Applicants (other Urban Development, 451 7th Street, Management, OPS/SAMHSA, than Federally recognized Indian tribal SW., L’Enfant Plaza Building, Room Rockwall II, 6th floor, 5600 Fishers governments) should contact the State’s 8001, Washington, DC 20410. Lane, Rockville, MD 20857, (301) Single Point of Contact (SPOC) as early FOR FURTHER INFORMATION CONTACT: 443–9666, E-Mail: as possible to alert them to the Vance T. Morris, Director, Office of [email protected]. prospective application(s) and to receive Single Family Program Development, Public Health System Reporting any necessary instructions on the State’s Department of Housing and Urban Requirements: The Public Health review process. For proposed projects Development, 451 7th Street SW., System Impact Statement (PHSIS) is serving more than one State, the Washington, DC 20410, telephone (202) intended to keep State and local health applicant is advised to contact the SPOC 708–2121 (this is not a toll free number) officials apprised of proposed health of each affected State. A current listing for copies of the proposed forms and services grant and cooperative of SPOCs is included in the application other available information. agreement applications submitted by guidance materials. The SPOC should SUPPLEMENTARY INFORMATION: The community-based nongovernmental send any State review process Department is submitting the proposed organizations within their jurisdictions. recommendations directly to: Division information collection to OMB for Community-based nongovernmental of Extramural Activities, Policy, and review, as required by the Paperwork service providers who are not Review, Substance Abuse and Mental Reduction Act of 1995 (44 U.S.C. transmitting their applications through Health Services Administration, Chapter 35, as amended). the State must submit a PHSIS to the Parklawn Building, Room 17–89, 5600 This Notice is soliciting comments head(s) of the appropriate State and Fishers Lane, Rockville, Maryland from members of the public and affected local health agencies in the area(s) to be 20857. agencies concerning the proposed affected not later than the pertinent The due date for State review process collection of information to: (1) Evaluate receipt date for applications. This recommendations is no later than 60 whether the proposed collection is VerDate 11 necessary for the proper performance of DEPARTMENT OF HOUSING AND techniques or other forms of information the functions of the agency, including URBAN DEVELOPMENT submission of responses. whether the information will have Title of Proposal: Consolidated Plan. [Docket No. FR–4733–N–02] practical utility; (2) Evaluate the Description of the Need for the accuracy of the agency’s estimate of the Information and Proposed Uses: The Notice of Proposed Information information is needed to provide HUD burden of the proposed collection of Collection: Comment Request, information; (3) Enhance the quality, with preliminary assessment as to the Consolidated Planning statutory and regulatory eligibility of utility, and clarity of the information to AGENCY: Office of the Assistant proposed grantee projects. A secondary be collected; and (4) Minimize the need is informing citizens of intended burden of the collection of information Secretary for Community Planning and Development, HUD. uses for program funds. on those who are to respond; including Agency Form Numbers (if applicable): the use of appropriate automated ACTION: Notice of proposed information The Department’s collection of this collection techniques or other forms of collection for public comments. information is in compliance with information technology, e.g., permitting SUMMARY: The proposed information statutory provisions of the Cranston- electronic submission of responses. collection requirements for Gonzalez National Affordable Housing This Notice also lists the following Consolidated Planning for Community Act of 1990 that requires the information: Planning and Development (CPD) participating jurisdictions submit a programs described below will be Comprehensive Housing Affordability Title of Proposal: Section 248 Single Strategy (Section 216(5)), the 1974 Family Mortgage Insurance on Indian submitted to the Office of Management and Budget (OMB) for review, as Housing and Community Development Reservations and Other Restricted Act, as amended, that requires states Lands. required by the Paperwork Reduction Act. The Department is soliciting public and localities to submit a Community OMB Control Number, if applicable: comments on the subject proposal. Development Plan (Section 104(b)(4) 2502–0340. and Section 104(b)(m) and statutory DATES: Comments Due Date: June 10, provisions of these Acts that require Description of the need for the 2002. states and localities to submit information and proposed use: ADDRESSES: Interested persons are applications for these formula grant Verification of mortgage security and invited to submit comments regarding programs. certification of eviction procedures by this proposal. Comments should refer to Members of the Affected Public: State Indian tribes are needed by HUD to the proposal by name and/or OMB and local governments participating in satisfy requirements for single-family Control Number and should be sent to: the Community Development Block mortgage insurance and for use in the Shelia Jones, Reports Liaison Oficer, Grant Program (CDBG), the HOME event of foreclosure. Department of Housing and Urban Investment Partnerships (HOME) Agency form numbers, if applicable: Development, 451 7th Street, SW., program, the Emergency Shelter Grants None. Room 7232, Washington, DC 20410. (ESG) program, or the Housing Opportunities with AIDS/HIV (HOPWA) FOR FURTHER INFORMATION CONTACT: Estimation of the total numbers of program. Salvatore Sclafani, Policy Division, hours needed to prepare the information Estimation of the total numbers of Room 7154, Washington, DC 20410, collection including number of hours needed to prepare the information respondents, frequency of response, and 202–708–0614, ext. 4364 (this is not a collection including number of hours of response: The estimated total toll-free number) for copies of the respondents, frequency of response and hours needed to prepare the information proposed forms and other available hours of response: Since the original collection is 610, the number of documents: approval of the Consolidated Planning respondents is 1,220 generating 1,220 SUPPLEMENTARY INFORMATION: The paperwork reduction estimate in 1995 responses annually, the frequency of Department will submit the proposed (OMB Control Number 2506–0117), response is on occasion, and the time information collection to OMB for additional localities have qualified for needed per response is 30 minutes. review, as required by the Paperwork assistance under the Community Reduction Act of 1995 (44 U.S.C. Development Block Grant (CDBG) Status of the proposed information Chapter 35 as amended). As required program, thus increasing the overall collection: Reinstatement, without under 5 CFR 1320.8(d)(1), HUD and burden calculation. Additionally, this change, of a previously approved OMB are seeking comments from submission includes paperwork collection for which approval has members of the public and affected estimates associated with narrative expired. agencies concerning the proposed information required by the Authority: The Paperwork Reduction Act collection of information to: (1) Evaluate Consolidated Annual Performance and of 1995, 44 U.S.C., Chapter 35, as amended. whether the proposed collection of Evaluation Report. Reporting on annual Dated: March 28, 2002. information is necessary for the proper performance was not included in the performance of the functions of the original Consolidated Plan paperwork Sean Cassidy, agency, including whether the estimate that was submitted to OMB. General Deputy Assistant Secretary for information will have practical utility; There have been several major Housing. (2) Evaluate the accuracy of the agency’s regulatory changes made to existing [FR Doc. 02–8478 Filed 4–8–02; 8:45 am] estimate of the burden of the proposed CDBG regulations and those for the BILLING CODE 4210–27–M collection of information; (3) Enhance HOME Investment Partnerships (HOME) the quality, utility, and clarity of the program which have resulted in a slight information to be collected; and (4) increase in overall burden hour Minimize the burden of the collection of calculations. Each of these regulatory information on those who are to changes have been submitted for respond; including through the use of comment in the National Register and to appropriate automated collection OMB independently. VerDate 11 The revised paperwork estimates are as follows: Number of re- Frequency of Total U.S. bur- Task spondents response den hours Consolidated Plan: Localities ...... 1,000 1 332,025 States ...... 50 1 48,900 Performance Report: Localities ...... 1,000 1 150,000 States ...... 50 1 12,000 Abreviated Strategy ...... 100 ...... 7,000 Total ...... 549,925 Status of the proposed information days of the date of publication of this and razorback sucker (Xyrauchen collection: Reinstatement, with minor notice to the address above; telephone texanus) for public display and changes of a previously approved 303–236–7400. education in conjunction with recovery collection for which approval is near SUPPLEMENTARY INFORMATION: The activities for the purpose of enhancing expiration and the request for OMB following applicants have requested their survival and recovery. approval’s for three years. The current renewal of scientific research and Applicants: Savage and Savage, OMB approval expires June 30, 2002. enhancement of survival permits to Louisville, Colorado, TE–051718; TRC Authority: Section 3506 of the Paperwork conduct certain activities with Mariah Associates, Inc., Laramie, Reduction Act of 1995, 44 U.S.C. Chapter 35, endangered species pursuant to Section Wyoming, TE–052582; Natural Resource as amended. 10(a)(1)(A) of the Endangered Species Options, Inc., Bozeman, Montana, TE– Dated: April 2, 2002. Act of 1973, as amended (16 U.S.C. 1531 052583. et seq.) Donna M. Abbenante, The above applicants request renewed Applicant: ERO Resources permits to survey for Southwestern Assistant Secretary for Community Planning Corporation, Denver, Colorado, TE– and Development. willow flycatchers (Empidonax traillii 043060. extimus) in conjunction with recovery [FR Doc. 02–8479 Filed 4–8–02; 8:45 am] The applicant requests a permit activities throughout the species’ range BILLING CODE 4210–29–M amendment to add surveys for for the purpose of enhancing its survival Southwestern willow flycatchers and recovery. (Empidonax traillii extimus) in Applicants: Dakota Zoo, Bismarck , DEPARTMENT OF THE INTERIOR conjunction with recovery activities North Dakota, TE–051815; Louisville throughout the species’ range for the Fish and Wildlife Service Zoo, Louisville, Kentucky, TE–051826; purpose of enhancing its survival and Phoenix Zoo, Phoenix, Arizona, TE– recovery. 051832; Toronto Zoo, Ontario, Canada, Endangered Species Permit Applicant: Dr. Todd Crowl, Utah State TE–051841; Elmwood Park Zoo, Applications University, Logan, Utah, TE–049748. Norristown, Pennsylvania, TE–053485; The applicant requests a renewed AGENCY: Fish and Wildlife Service, Lee Richardson Zoo, Garden City, permit to take Bonytail chub (Gila Interior. Kansas, TE–051825; Fort Worth Zoo, elegans), Colorado pikeminnow ACTION: Notice of receipt. Fort Worth, Texas, TE–051819. (Ptychocheilus lucius), June sucker The above applicants request permits SUMMARY: (Chasmistes liorus), and Razorback We announce our receipt of to possess black-footed ferrets ( Mustela applications to conduct certain sucker (Xyrauchen texanus) in conjunction with recovery activities nigripes) for public display and activities pertaining to scientific propagation in conjunction with research and enhancement of survival of throughout the species’ range for the purpose of enhancing their survival and recovery activities for the purpose of endangered species. enhancing their survival and recovery. DATES: Written comments on these recovery. Applicant: Omaha’s Henry Doorly Applicant: Wildlife Conservation requests for permits must be received Society, Central Park Zoo, New York, May 9, 2002. Zoo, Omaha, Nebraska, TE–053961. The above applicants request permits New York, TE–051847; Toledo ADDRESSES: Written data or comments to possess black-footed ferrets (Mustela Zoological Gardens, Toledo, Ohio, TE– should be submitted to the Assistant nigripes), Desert tortoise (Gopherus 052627. Regional Director-Ecological Services, agassizii), gray wolf (Canis lupus), The above applicants request permits U.S. Fish and Wildlife Service, P.O. Box grizzly bear (Urus arctos horribilis), and to possess Wyoming toads (Bufo 25486, Denver Federal Center, Denver, Wyoming toad (Bufo hemiophrys hemiophrys baxteri) for public display Colorado 80225–0486; telephone 303– baxteri) for public display and and propagation in conjunction with 236–7400, facsimile 303–236–0027. propagation in conjunction with recovery activities for the purpose of FOR FURTHER INFORMATION CONTACT: recovery activities for the purpose of enhancing their survival and recovery. Documents and other information enhancing their survival and recovery. Correction submitted with these applications are Applicant: The Nature Conservancy, available for review, subject to the Hayden, Colorado, TE–054217. In the Federal Register of January 10, requirements of the Privacy Act and The applicant requests a permit to 2002, (67 FR 1365), FR Doc. 02–603, in Freedom of Information Act, by any possess Colorado pikeminnow the second column, the list of species party who submits a written request for (Ptychocheilus lucius), bonytail (Gila requested by Trent Miller should read as a copy of such documents within 20 elegans), humpback chub (Gila cypha), follows: VerDate 11 Permit No. TE–047252 where it is again a secure, self- comments received during the review Applicant: Trent Miller, SWCA, Inc., sustaining member of its ecosystem is a period, the Recovery Plan will be Environmental Consultants, primary goal of the Service’s submitted for final approval. endangered species program. To help Westminster Colorado. Public Comments Solicited The applicant requests a renewed guide the recovery effort, the Service is permit to survey for black-footed ferrets working to prepare Recovery Plans for The Service solicits written comments (Mustela nigripes), and Southwestern most of the listed species native to the on the Recovery Plan described. All willow flycatcher (Empidonax traillii United States. Recovery Plans describe comments received by the date specified extimus) in conjunction with recovery actions considered necessary for above will be considered prior to activities throughout the species’ range conservation of species, establish approval of the Recovery Plan. for the purpose of enhancing their criteria for downlisting or delisting Authority: The authority for this action is survival and recovery. them, and estimate time and cost for Section 4(f) of the Endangered Species Act, implementing the recovery measures 16 U.S.C. 1533(f). Dated: March 20, 2002. needed. Dated: March 21, 2002. John A. Blankenship, The Endangered Species Act of 1973 Pat Langley, Acting Regional Director, Denver, Colorado. (Act), as amended (16 U.S.C. 1531 et Acting Regional Director. [FR Doc. 02–8227 Filed 4–8–02; 8:45 am] seq.) requires the development of [FR Doc. 02–8381 Filed 4–8–02; 8:45 am] BILLING CODE 4310–55–P Recovery Plans for listed species unless such a Plan would not promote the BILLING CODE 4310–55–P conservation of a particular species. DEPARTMENT OF INTERIOR Section 4(f) of the Act, as amended in 1988, requires that public notice and an DEPARTMENT OF THE INTERIOR Fish and Wildlife Service opportunity for public review and Fish and Wildlife Service comment be provided during Recovery Notice of Availability of the Draft Plan development. The Service will Notice of Availability of Environmental Revised Recovery Plan for the Gila consider all information presented Trout (Oncorhynchus gilae) Assessment and Finding of No during a public comment period prior to Significant Impact for Issuance of AGENCY: Fish and Wildlife Service, approval of each new or revised Incidental Take Permits to Gulf Interior. Recovery Plan. The Service and other Highlands LLC and Fort Morgan ACTION: Notice of document availability. Federal agencies will also take these Paradise Joint Venture on Privately comments into account in the course of Owned Lands in Alabama SUMMARY: The U.S. Fish and Wildlife implementing Recovery Plans. Service (Service) announces the The document submitted for review is AGENCY: Fish and Wildlife Service, availability for public review of the draft the draft revised recovery plan for the Interior. Revised Recovery Plan for the Gila trout Gila trout. The species was listed as ACTION: Notice of availability. (Oncorhynchus gilae). The Gila trout is endangered on March 11, 1967, under We, the U.S. Fish and Wildlife endemic to mountain streams in the the Federal Endangered Species Service (Service), announce our intent Gila, San Francisco, Agua Fria, and Preservation Act of 1966. Federal status to issue incidental take permits to Gulf Verde river drainages in New Mexico of the fish as endangered was continued Highlands LLC and Fort Morgan and Arizona. The Service solicits review under the Endangered Species Act of Paradise Joint Venture (Applicants) for and comment from the public on this 1973. residential development in Alabama, draft plan. The threats facing the survival and recovery of this species are the pursuant to Section 10(a)(1)(B) of the DATES: The comment period for this competition and hybridization with Endangered Species Act of 1973, as proposal closes on June 10, 2002. amended (Act). The authorized take Comments on the draft revised recovery non-native trout species (e.g., Oncorhynchus mykiss), forest would be incidental to otherwise lawful plan must be received by the closing activities, including construction of date. management practices, grazing management, severe drought, residential condominiums, commercial ADDRESSES: Persons wishing to review catastrophic wildfires, and floods. This facilities, and recreational amenities on the draft Recovery Plan can obtain a draft Recovery Plan, when finalized, adjoining tracts of land owned by the copy from the U.S. Fish and Wildlife will supercede the Recovery Plan Applicants. The proposed action Service, New Mexico Ecological finalized for the species in 1993. The includes implementation of the Habitat Services Field Office, 2105 Osuna NE, draft Recovery Plan includes new Conservation Plan (HCP) jointly Albuquerque, New Mexico, 87113. If scientific information about the species developed by the Applicants, as you wish to comment, you may submit gathered since 1993 and provides required by Section 10(a)(2)(B) of the your comments and materials objectives and actions needed to Act, to minimize and mitigate for concerning this draft revised recovery downlist then delist the species. incidental take of the Federally-listed, plan to the Field Supervisor at the Recovery activities designed to achieve endangered Alabama beach mouse address above. these objectives include establishing (Peromyscus polionotus FOR FURTHER INFORMATION CONTACT: additional populations of Gila trout; ammobates)(ABM), the endangered Field Supervisor, New Mexico protecting existing populations and Kemp’s ridley sea turtle (Lepidochelys Ecological Services Field Office, at the habitat; continuing to obtain kempii), the threatened green sea turtle above address; telephone 505/346–2525, information needed to address (Chelonia mydas), and the threatened facsimile 505/346–2542. conservation issues; and continuing to loggerhead sea turtle (Caretta caretta). SUPPLEMENTARY INFORMATION: provide information and coordinating The subject permits would authorize recovery of this species. take of ABM and the three sea turtles Background The draft Recovery Plan is being along 2,844 linear feet of coastal dune Restoring an endangered or submitted for technical and agency habitat fronting the Gulf of Mexico in threatened animal or plant to the point review. After consideration of Baldwin County, Alabama. VerDate 11 We published a notice in the Federal Daphne, Alabama 36526, or Bon Secour DATES: May 1 and 2, 2002. Register (66 FR 54020) on October 25, National Wildlife Refuge, 12295 State Location: Stage Stop Inn, Choteau, 2001 and again on December 28, 2001 Highway 180, Gulf Shores, Alabama Montana. (66 FR 67290) that these applications 35603. Please reference permit numbers FOR FURTHER INFORMATION CONTACT: had been filed with the Service. At that TE007985–0 and TE031307–0 in Malta Field Manager, Malta Field Office, time, we had not determined whether requests for the documents discussed 501 South 2nd Street East, Malta, the proposed issuance of the permits herein. Montana 59538. would comprise a major Federal action. FOR FURTHER INFORMATION CONTACT: Mr. SUPPLEMENTARY INFORMATION: These Following completion of our David Dell, Regional HCP Coordinator, meetings are open to the public and environmental review and consideration (see ADDRESSES above), telephone: 404/ there will be a public comment period of public comments received, the 679–7313, facsimile: 404/679–7081, e- at the beginning of each meeting; as Service has now determined that mail: [email protected]; or Ms. detailed above. issuance of the incidental take permits Celeste South, Fish and Wildlife would not be a major Federal action Biologist, Daphne Field Office, Alabama David L. Mari, significantly affecting the quality of the (see ADDRESSES above), telephone: 251/ Field Manager. human environment within the meaning 441–5181. [FR Doc. 02–8238 Filed 4–8–02; 8:45 am] of Section 102(2)(C) of the National BILLING CODE 4310–$$–P Environmental Policy Act of 1969, as Dated: March 29, 2002. amended (NEPA). The Service has Cynthia K. Dohner, Acting Regional Director. prepared a Finding of No Significant MISSISSIPPI RIVER COMMISSION Impact (FONSI) based on the EA and [FR Doc. 02–8491 Filed 4–8–02; 8:45 am] public comment. This notice is BILLING CODE 4310–55–P Sunshine Act Meeting; Notice provided pursuant to Section 10 of the Act. Agency Holding the Meeting: We have evaluated the issuance of DEPARTMENT OF THE INTERIOR Mississippi River Commission. section 10(a)(1)(B) permits under Time and Date: Begin at 1:30 p.m. and section 7 of the Act by conducting an Bureau of Land Management adjourn by 4:00 p.m., April 23, 2002. intra-Service section 7 consultation. We [MT–060–1020–PG] Place: Mississippi River Commission have determined that issuance of the Headquarters Building, 1400 Walnut permits will not jeopardize the Central Montana Resource Advisory Street, Vicksburg, MS. Council Meeting continued existence of the affected Status: Open to the public for species. We have presented this AGENCY: Bureau of Land Management, observation but not for participation. determination in the biological opinion Lewistown Field Office, Interior. Matter To Be Considered: The prepared in our analysis of the Commission will consider the incidental take permit applications. ACTION: Notice of meeting. Morganza, Louisiana, to the Gulf of We have evaluated whether the SUMMARY: The Central Montana Mexico Hurricane Protection Project proposed permits would meet the Resource Advisory Council will meet Final Feasibility Report and Final issuance criteria established by section May 1 and 2, 2002, at the Stage Stop Environmental Impact Statement. 10(a)(2)(B) of the Act. We have Inn, in Choteau, Montana. Contact Person for More Information: determined, and outlined in our Set of The May 1st, 2002, meeting will begin Findings, that the incidental take permit Mr. Stephen Gambrell, telephone 601– at 1 p.m. with a 30-minute public 634–5766. applications meet these criteria for comment period. The council will then issuance. hear briefings and consider reports from Thomas A. Holden Jr., Copies of the FONSI, biological council members and BLM staff Colonel, Corps of Engineers, Secretary, opinion, and Set of Findings have been concerning BLM’s core team structure Mississippi River Commission. forwarded to those people and groups for preparing a resource management [FR Doc. 02–8656 Filed 4–5–02; 12:34 pm] who commented in response to our plan; council subgroup BILLING CODE 3710–GX–M previous public notices. Copies of these recommendations; energy developments documents are also available to those along the Rocky Mountain front; an who have not commented on these energy policy update; and the Macum NATIONAL AERONAUTICS AND applications before (see ADDRESSES Environmental Assessment update. This SPACE ADMINISTRATION below). Final permit issuance will occur meeting is scheduled to adjourn at 5 no sooner than April 19, 2002. p.m. [Notice (02–048)] ADDRESSES: Persons wishing to receive The May 2nd, 2002, meeting will Debt Collection Improvement Act of the application, HCP, EA, FONSI, begin at 8 a.m. with a 30-minute public 1996: Administrative Wage biological opinion, and set of findings comment period. The group will then Garnishment may obtain an electronic copy on consider field manager issues; rights-of- compact disk by writing, telephoning, or ways and easements across public AGENCY: National Aeronautics and e-mailing the Service’s Southeast lands; budget information; an update Space Administration. Regional Office, Atlanta, Georgia (see concerning ferry crossings on the Upper ACTION: Notice of withdrawal. CONTACTS below). Documents will also Missouri River; the draft sage grouse be available for public inspection by conservation plan; and the potential SUMMARY: The National Aeronautics and appointment during normal business impact of swift fox management. The Space Administration (NASA) has hours at the Regional Office, 1875 council will then move into several previously issued a Notice concerning Century Boulevard, Suite 200, Atlanta, administrative topics (meeting critique, administrative wage garnishment under Georgia 30345 (Attn: Endangered travel vouchers, next meeting location- the Debt Collection Improvement Act of Species Permits), Ecological Services topics-logistics-etc.). This meeting is 1996, in the Federal Register on March Field Office, 1208–B Main Street, scheduled to adjourn at 3:30 p.m. 7, 2002, (67 FR 10447). NASA VerDate 11 withdraws that Notice and will be This meeting will be webcast live at report on the quality of services the adopting new regulations in rulemaking. the Web address—www.nrc.gov. Postal Service provides to the public. DATES: Effective: April 9, 2002. 2 p.m. Discussion of The briefing is open to the public. The ADDRESSES: NASA Headquarters, Code Intragovernmental Issues (Closed— report is posted on the Commission’s BFZ, Washington, DC 20546. Ex. 9) Web site (www.prc.gov). It can be accessed by selecting ‘‘Consumer FOR FURTHER INFORMATION CONTACT: The schedule for Commission Advocate’’ in the banner and selecting Melvin Denwiddie, (202) 358–0983. meetings is subject to change on short notice. To verify the status of meetings ‘‘OCA Papers’’ in the left-hand frame. Stephen J. Varholy, call (recording)—(301) 415–1292. DATES: April 9, 2002. Deputy Chief Financial Officer. Contact person for more information: ADDRESSES: Postal Rate Commission [FR Doc. 02–8487 Filed 4–8–02; 8:45 am] David Louis Gamberoni (301) 415–1651. (hearing room), 1333 H Street NW., BILLING CODE 7510–01–P ADDITIONAL INFORMATION: By a vote of 5– Washington, DC 20268–0001, suite 300. 0 on April 2 and 3, the Commission FOR FURTHER INFORMATION CONTACT: determined pursuant to U.S.C. 552b(e) Stephen L. Sharfman, general counsel, NUCLEAR REGULATORY and § 9.107(a) of the Commission’s rules Postal Rate Commission, 202–789–6820. COMMISSION that ‘‘Affirmation of (a) Duke Cogema Stone & Webster (Savannah River Mixed Steven W. Williams, Sunshine Act Meeting Notice Oxide Fuel Fabrication Facility); Duke Secretary. Cogema Stone & Webster’s Petition for [FR Doc. 02–8489 Filed 4–8–02; 8:45 am] DATE: Weeks of April 8, 15, 22, 29, May Interlocutory Review, (b) International BILLING CODE 7710–FW–M 6, 13, 2002. Uranium (USA) Corp. White Mesa PLACE: Commissioners’ Conference Uranium Mill Appeal of LBP–02–06 Room, 11555 Rockville Pike, Rockville, (MLA–11), and c) Private Fuel Storage SECURITIES AND EXCHANGE Maryland. (Independent Spent Fuel Storage COMMISSION STATUS: Public and Closed. Installation) Docket No. 72–22–ISFSI; MATTERS TO BE CONSIDERED: Order responding to Utah’s Suggestion [Release No. 34–45685; File No. SR–NASD– of Lack of Jurisdiction’ and Petition for 2001–86] Week of April 8, 2002 Rulemaking under the Nuclear Waste Self-Regulatory Organizations; Order Policy Act’’ be held on April 3, and on Friday, April 12, 2002 Granting Approval of Proposed Rule less than one week’s notice to the 9:25 a.m. Affirmation Session (Public Change by the National Association of public. Meeting) (if needed) Securities Dealers, Inc. Relating to The NRC Commission Meeting Fees for Nasdaq Index Information Week of April 15, 2002—Tentative Schedule can be found on the internet There are no meetings scheduled for at: www.nrc.gov/what-we-do/policy- April 3, 2002. the Week of April 15, 2002. making/schedule.html. On December 4, 2001, the National This notice is distributed by mail to Association of Securities Dealers, Inc. Week of April 22, 2002—Tentative several hundred subscribers; if you no (‘‘NASD’’), through its subsidiary, The There are no meetings scheduled for longer wish to receive it, or would like Nasdaq Stock Market, Inc. (‘‘Nasdaq’’), the Week of April 22, 2002. to be added to the distribution, please filed with the Securities and Exchange contact the Office of the Secretary, Week of April 29, 2002—Tentative Commission (‘‘Commission’’), pursuant Washington, DC 20555 (301–415–1969). to Section 19(b)(1) of the Securities Tuesday, April 30, 2002 In addition, distribution of this meeting Exchange Act of 1934 (‘‘Act’’)1 and Rule notice over the Internet system is 2 9:30 a.m. Discussion of 19b-4 thereunder, a proposed rule available. If you are interested in change to amend NASD Rule 7030 Intergovernmental Issues (Closed— receiving this Commission meeting Ex. 9) (Special Options) to increase the schedule electronically, please send an monthly fee charged to market data Wednesday, May 1, 2002 electronic message to [email protected]. vendors for non-core, real-time 8:55 a.m. Affirmation Session (Public Dated: April 14, 2002. information about Nasdaq indexes. Meeting) (if needed) David Louis Gamberoni, Nasdaq established the fee in 1992 at 9 a.m. Briefing on Results of Agency Technical Coordinator, Office of the $500 per month. The proposed rule Action Review Meeting—Reactors Secretary. change would raise the fee to $2,000 per (Public Meeting) (Contact: Robert [FR Doc. 02–8611 Filed 4–5–02; 10:19 am] month. Pascarelli, 301–415–1245) BILLING CODE 7590–01–M The proposed rule change was This meeting will be webcast live at published for notice and comment in 3 the Web address—www.nrc.gov. the Federal Register on March 1, 2002. POSTAL RATE COMMISSION The Commission received no comments Week of May 6, 2002—Tentative on the proposal. This order approves the There are no meetings scheduled for Briefing on OCA Study proposed rule change. the Week of May 6, 2002. The Commission finds that the AGENCY: Postal Rate Commission. proposed rule change is consistent with Week of May 13, 2002—Tentative ACTION: Notice of briefing. the requirements of the Act and the rules and regulations thereunder Thursday, May 16, 2002 SUMMARY: The Commission’s Office of applicable to a national securities 9:25 a.m. Affirmation Session (Public the Consumer Advocate (OCA) will Meeting) (if needed) present a briefing on Tuesday, April 9, 1 15 U.S.C. 78s(b)(1). 9:30 a.m. Meeting with World 2002, beginning at 11 a.m., in the Postal 2 17 CFR 240.19b-4. Association of Nuclear Operators Rate Commission’s hearing room. The 3 See Securities Exchange Act Release No. 45472 (WANO) (Public Meeting) briefing will address the OCA’s recent (February 22, 2002), 67 FR 9489. VerDate 11 association 4 and, in particular, the SECURITIES AND EXCHANGE for closed-end management investment requirements of Sections 15A(b)(5)5 and COMMISSION companies registered under the 6 Investment Company Act of 1940 (6) of the Act. Section 15A(b)(5) [Release No. 34–45684; File No. SR–NYSE– requires the equitable allocation of 2001–45] (‘‘pilot’’). reasonable fees and charges among I. Self-Regulatory Organization’s members and other users of facilities Self-Regulatory Organizations; Notice Statement of the Terms of Substance of operated or controlled by a national of Filing and Order Granting Partial the Proposed Rule Change securities association. Section 15A(b)(6) Accelerated Approval of Proposed Rule Change, Amendment No. 1, and The NYSE proposes to implement a requires rules that foster cooperation three-month pilot in respect of the and coordination with persons engaged Amendment No. 2 Thereto by the New York Stock Exchange, Inc. Instituting a following proposed rule change, as in facilitating transactions in securities amended, while the Commission and that are not designed to permit Pilot Program Relating to Amendments to the Initial Listing Standards and considers permanent approval of the unfair discrimination between proposal. The Exchange is proposing to customers, issuers, brokers or dealers. Allocation Policy for Closed-End Management Investment Companies amend Section 102.04 of the Exchange’s The Commission received no comments Registered Under the Investment Listed Company Manual (‘‘Manual’’) on the proposed fee increase. The Company Act of 1940 regarding listing standards for closed- Commission believes that the fee is end management investment companies reasonable, given Nasdaq’s April 2, 2002. registered under the Investment representations regarding the 1,800% Pursuant to section 19(b)(1) of the Company Act of 1940 (hereinafter growth of Nasdaq trading volume, the Securities Exchange Act of 1934 referred to as ‘‘funds’’ or ‘‘closed-end increase in processing demands, and the (‘‘Act’’),1 and Rule 19b–4 thereunder,2 funds’’). The Exchange is proposing to increase in the subscriber audience notice is hereby given that on October apply to all individual closed-end funds since the fee’s inception. The 29, 2001, the New York Stock Exchange, that desire to list on the Exchange the Commission believes that increasing the Inc. (‘‘NYSE’’ or ‘‘Exchange’’) filed with $60 million public market value test fee from $500 per month to $2,000 per the Securities and Exchange currently used for funds applying in month should not impede the Commission (‘‘Commission’’) the connection with their initial public offering.5 In addition, the Exchange is widespread availability of the index proposed rule change as described in proposing a standard under which a information on a non-discriminatory Items I, II, and III below, which Items group of funds meeting certain specified basis. have been prepared by the Exchange. On March 14, 2002, the NYSE filed requirements can be listed concurrently It is therefore ordered, pursuant to Amendment No. 1 to the proposed rule by a single ‘‘fund family,’’ even if the Section 19(b)(2) of the Act,7 that the change with the Commission.3 On April group includes one or more funds with proposed rule change (SR-NASD–2001– 1, 2002, the NYSE filed Amendment No. less than $60 million in public market 86) be, and it hereby is, approved. 2 to the proposed rule change with the value. Finally the Exchange is proposing For the Commission, by the Division of Commission.4 The Commission is to amend its Allocation Policy and Market Regulation, pursuant to delegated publishing this notice to solicit Procedures (‘‘Allocation Policy’’) with authority.8 comments on the proposed rule change, respect to the specialist allocation of funds listed in such a fund family J. Lynn Taylor, as amended, from interested persons and grant accelerated approval to the group. Assistant Secretary. portion of the proposal instituting a The text of the proposed rule change [FR Doc. 02–8485 Filed 4–8–02; 8:45 am] pilot program relating to the listing is available at the NYSE and at the BILLING CODE 8010–01–P eligibility criteria and allocation policy Commission. II. Self-Regulatory Organization’s 1 15 U.S.C. 78s(b)(1). Statement of the Purpose of, and 2 17 CFR 240.19b–4. Statutory Basis for, the Proposed Rule 3 See letter from Darla C. Stuckey, Corporate Secretary, NYSE, to Nancy J. Sanow, Assistant Change Director, Division of Market Regulation In its filing with the Commission, the (‘‘Division’’), Commission, dated March 12, 2002 NYSE included statements concerning (‘‘Amendment No. 1’’). In Amendment No. 1, the Exchange, in part, substituted the phrase the purpose of and basis for the ‘‘investment management company’’ for ‘‘fund proposed rule change, as amended, and family,’’ provided a basis for the fund family discussed any comments it received on standards, clarified the basis for establishing a fund the proposed rule change. The text of group and the change in terminology in the listing standards from ‘‘net assets’’ to ‘‘market value of these statements may be examined at publicly-held shares,’’ made conforming changes to the rule text, and further clarified its allocation 5 The language in the current Manual Section policy for a group of closed-end funds. 102.04, which the NYSE is proposing to replace, 4 See letter from Darla C. Stuckey, Corporate requires that a newly organized fund have $60 Secretary, NYSE, to Nancy J. Sanow, Assistant million in ‘‘net assets.’’ The NYSE proposes to use Director, Division, Commission, dated April 1, 2002 the term ‘‘market value of publicly held shares,’’ but (‘‘Amendment No. 2’’) (replacing Form 19b–4 in its represents that there is no substantive change entirety). In Amendment No. 2, the Exchange, in involved in this different terminology. In the case 4 In approving this proposed rule change, the part, requested a three-month pilot, as well as of any IPO, whether of a business company or a Commission has considered the proposed rule’s permanent approval of the proposed rule change, fund, the Exchange has always looked at whether impact on efficiency, competition, and capital substituted the phrase ‘‘fund family’’ for the offering has raised $60 million, and that is what formation. 15 U.S.C. 78c(f). ‘‘investment management company,’’ defined the the Exchange will continue to do under the 5 15 U.S.C. 78o-3(b)(5). term ‘‘fund family,’’ clarified that each fund in the amended rule. Similarly, with a transfer the group is individually subject to the Exchange’s Exchange has always looked at the aggregate market 6 15 U.S.C. 78o-3(b)(6). continuing listing criteria, made conforming value of publicly held shares, and that is what the 7 15 U.S.C. 78s(b)(2). changes to its rule text, and requested accelerated Exchange will continue to do under the amended 8 17 CFR 200.30–3(a)(12). approval of the pilot. rule. See Amendment No. 1, supra note 3. VerDate 11 the places specified in Item IV below. more of the group did not satisfy the $60 one specialist unit would be The Exchange has prepared summaries, million test: appropriate. • set forth in Sections A, B, and C below, Total group market value of The Exchange first notes that the of the most significant aspects of such publicly held shares (offering proceeds, normal Allocation Policy apply to statements. in the case of newly formed funds) must closed-end funds being listed on the A. Self-Regulatory Organization’s equal in the aggregate at least $200 Exchange just as they apply to any other million; business corporation being listed. Statement of the Purpose of, and • Statutory Basis for, the Proposed Rule Each group must average a Therefore, the amendment being Change minimum of $45 million in market proposed hereby is altering the value of publicly held shares (proceeds) Allocation Policy in only the discreet 1. Purpose per fund; and manner specified. The Exchange The Exchange represents that • No single fund in the group can represents that all the other aspects of currently there are over 380 closed-end have a market value of publicly held the Allocation Policy, including the funds listed on the Exchange. The shares (proceeds) less than $30 million. method by which the listed company is Exchange asserts that many of these As discussed above, this group permitted to pick from a panel of funds represent multiple listings from a standard will apply regardless of specialists put together by the family of funds such as Nuveen, Morgan whether the group consists of newly Allocation Committee, will apply.11 6 formed or existing funds, or a Stanley, Van Kampen or Merrill Lynch. The Exchange also has stated that the combination thereof.8 The Exchange has The Exchange represents that funds are allocation of a family group to a single determined that the foregoing standards often offered, issued, and listed in specialist is to be the norm when listing achieve a balance between maintaining groups, such as state municipal bond fund families. The Exchange represents the Exchange’s standards at an funds. It is the Exchange’s that closed-end funds are often less appropriate level, and providing some understanding that the fund families actively traded than regular listed additional flexibility to fund families prefer to list all funds in a group on the companies, and the fact that a family same market, but can encounter that desire to concurrently list a group group will include one or more funds on difficulties when one or more of a group of closed-end funds on the same the smaller end of the spectrum suggests falls below the size required by the Exchange.9 that those members of the group may Exchange. As the Exchange explored a The Exchange is also proposing to trade even less actively than the average specific standard for group listings of amend its Allocation Policy 10 to closed-end fund. As a result, it will closed-end funds, it determined that it provide that the Allocation Committee usually be most appropriate to have the made sense not only for groups of newly should generally allocate to one entire group allocated to the same formed funds but for groups of existing specialist unit all the closed-end funds specialist, so that it has the chance to funds as well. This, in turn, prompted in a family group listed under the group trade both the larger and the smaller the Exchange to re-examine its current criteria discussed above. The Exchange funds in the group. However, the policy of applying a different set of believes that economies of scale and Allocation Policy recognizes that there standards to funds with three or more more effective utilization of resources are situations where the Allocation years of operating history. Presently, may be realized through the allocation Committee may conclude that allocation such funds must meet the financial of a group of what are likely to be less to more than one specialist unit is standards applicable to regular actively traded securities to one preferable. The Exchange asserts that it operating companies (earnings, cash specialist unit, rather than to have the is impossible to predict all the flow, etc.), in contrast to newly formed individual funds within the group circumstances in which this might arise, funds, which may be listed based only allocated to a number of units. In certain which is why the Allocation Committee on raising at least $60 million. The situations, however, the Allocation is being provided with the discretion to Exchange has determined that this Committee would be permitted to react to situations as they occur. distinction between existing and newly allocate funds within a group to more However, one set of circumstances that formed funds no longer serves any than one unit. Such situations could might prompt the Allocation Committee desired business or other purpose, and include, for example, instances where to allocate to more than one specialist so is appropriate for elimination. the number of funds in the group, the is if a particularly large family group is Accordingly, the Exchange is proposing types of funds, or the relative values of presented with possibly several funds in to apply a $60 million public market the funds suggest to the Allocation the various size categories. The value test to all funds seeking to list, Committee that allocation to more than Exchange asserts that it could be regardless of whether they are newly considered overly burdensome to ask formed funds, or existing funds investment adviser bringing the group listing to the one unit to take on the entire group at transferring from another market. Exchange. See Amendment No. 1, supra note 3. 8 one time, and it could be very possible In addition, the Exchange is See Amendment No. 2, supra note 4. 9 to divide the group into two or perhaps proposing to apply the following See Amendment Nos. 1 and 2, supra notes 3 and 4. Once a group of closed-end funds is listed under even more tranches for allocation original listing standards to a group of the proposed standards, each fund in the group will purposes, while still serving the goal of closed-end funds listed concurrently by be individually subject to the Exchange’s continued fairness and efficiency that has a single fund family. By meeting the listing criteria applicable to funds specified in prompted the family group approach following criteria, the funds in the Section 802.01B of the Manual. 10 12 7 The intent of the Exchange’s Allocation Policy described herein. group could all be listed even if one or is (1) to ensure that the allocation process is based on fairness and consistency and that all specialist 2. Statutory Basis 6 The Exchange represents that a ‘‘fund family’’ units have a fair opportunity for allocations based (as the term is used herein) consists of funds with on established criteria and procedures; (2) to The Exchange believes that the a common investment adviser or having investment provide an incentive for ongoing enhancement of proposed rule change, as amended, is advisers which are all affiliates of one another. See performance by specialist units; (3) to provide the Amendment No. 2, supra note 4. best possible match between specialist unit and 7 The Exchange represents that the composition of security; and (4) to contribute to the strength of the 11 See Amendment No. 1, supra note 3. the group will be determined in each case by the specialist system. 12 Id. VerDate 11 consistent with section 6(b) of the Act,13 arguments concerning the foregoing, considerations 19 and that accelerated in general, and furthers the objectives of including whether the proposed rule approval will enable the Exchange to Section 6(b)(5),14 in particular, in that it change, as amended, is consistent with accommodate its timetable for listing is designed to prevent fraudulent and the Act. Persons making written fund families.20 The Commission manipulative acts and practices, to submissions should file six copies believes that accelerated approval will promote just and equitable principles of thereof with the Secretary, Securities permit the Exchange to continue listing trade, to remove impediments to and and Exchange Commission, 450 Fifth funds and accommodate the desire of perfect the mechanism of a free and Street, NW, Washington, DC 20549– fund families to list groups of closed- open market and a national market 0609. Copies of the submission, all end funds on one marketplace, while system, and, in general, to protect subsequent amendments, all written allowing the Commission adequate time investors and the public interest. statements with respect to the proposed to consider the Exchange’s proposal for rule change that are filed with the permanent approval of the pilot.21 B. Self-Regulatory Organization’s Accordingly, the Commission finds it Statement on Burden on Competition Commission, and all written communications relating to the appropriate and consistent with sections The Exchange does not believe that proposed rule change between the 6(b)(5) and 19(b)(2) of the Act 22 for the proposed rule change, as amended, Commission and any person, other than partially approving the proposed rule will impose any burden on competition those that may be withheld from the change, as amended, prior to the that is not necessary or appropriate in public in accordance with the thirtieth day after the date of furtherance of the purposes of the Act. provisions of 5 U.S.C. 552, will be publication of notice thereof in the Federal Register. C. Self-Regulatory Organization’s available for inspection and copying in the Commission’s Public Reference It is therefore ordered, pursuant to Statement on Comments on the section 19(b)(2) of the Act,23 the Room. Copies of the filing will also be Proposed Rule Change Received from proposed rule change, as amended, (File available for inspection and copying at Members, Participants, or Others No. SR–NYSE–2001–45) is approved on the principal offices of the NYSE. All a pilot basis until July 5, 2002. The Exchange has neither solicited submissions should refer to File No. nor received any written comments with SR–NYSE–2001–45 and should be For the Commission, by the Division of respect to the proposed rule change. submitted by April 30, 2002. Market Regulation, pursuant to delegated authority.24 III. Date of Effectiveness of the V. Commission Findings and Order Margaret H. McFarland, Proposed Rule Change and Timing for Granting Partial Accelerated Approval Commission Action Deputy Secretary. of Proposed Rule Change [FR Doc. 02–8514 Filed 4–8–02; 8:45 am] Within 35 days of the date of BILLING CODE 8010–01–P publication of this notice in the Federal The Commission finds that the Register or within such longer period (i) proposed rule change, as amended, as the Commission may designate up to relating to the establishment of the pilot SECURITIES AND EXCHANGE 90 days of such date if it finds such is consistent with the requirements of COMMISSION longer period to be appropriate and the Act and the rules and regulations publishes its reasons for so finding or thereunder applicable to a national [Release No. 34–45680; File No. SR–PCX– 2002–16] (ii) as to which the Exchange consents, securities exchange. Specifically, the the Commission will: Commission believes the proposal is Self-Regulatory Organizations; Notice (A) by order approve such proposed consistent with the requirements under 17 of Filing and Immediate Effectiveness rule change, or section 6(b)(5) of the Act that the rules of Proposed Rule Change by the (B) institute proceedings to determine of an exchange be designed to promote Pacific Exchange, Inc. Relating to whether the proposed rule change just and equitable principles of trade, to Changes to the PCX’s Schedule of should be disapproved. remove impediments to and perfect the Fees and Charges for Exchange The Exchange has requested that the mechanism of a free and open market Services Commission find good cause pursuant and a national market system, and, in to section 19(b)(2) of the Act,15 for general, to protect investors and the April 2, 2002. approving the establishment of the pilot public.18 The Commission believes that Pursuant to Section 19(b)(1) of the for a three-month period ending on July the proposed pilot strikes a reasonable Securities Exchange Act of 1934 5, 2002 (or until such earlier time as the balance between the Exchange’s (‘‘Act’’)1 and Rule 19b–4 thereunder,2 Commission grants the Exchange’s obligation to protect investors and their notice is hereby given that on March 20, request for permanent approval of the confidence in the market and the 2002, the Pacific Exchange, Inc. (‘‘PCX’’ pilot), prior to the 30th day after the Exchange’s obligation to perfect the or ‘‘Exchange’’) filed with the Securities date of publication of notice thereof in mechanism of a free and open market by and Exchange Commission (‘‘SEC’’ or the Federal Register. The Exchange listing funds, including fund families, represents that accelerated approval will on the Exchange. 19 Telephone conversation between James F. Duffy, Senior Vice President, Elena Daly, Assistant enable the Exchange to accommodate The Commission finds good cause for General Counsel, NYSE; and Sonia A. Patton, the timetable of listing fund families on approving the pilot prior to the 30th day Special Counsel, and Frank N. Genco, Attorney, the Exchange.16 after publication in the Federal Division, Commission, on April 02, 2002. Register. The NYSE has represented that 20 See Amendment No. 2, supra note 4. IV. Solicitation of Comments 21 Approval of the three-month pilot period it desires to promptly implement the should not be interpreted as suggesting that the Interested persons are invited to proposed rule change based on business Commission is predisposed to approving the submit written data, views, and proposal on a permanent basis. 22 17 15 U.S.C. 78f(b)(5). 15 U.S.C. 78f(b)(5) and 78s(b)(2). 13 23 15 U.S.C. 78f(b). 18 In approving this pilot, the Commission notes 15 U.S.C. 78s(b)(2). 14 15 U.S.C. 78f(b)(5). that it has considered the proposed rule’s impact on 24 17 CFR 200.30–3(a)(12). 15 15 U.S.C. 78s(b)(2). efficiency, competition, and capital formation. 15 1 15 U.S.C. 78s(b)(1). 16 See Amendment No. 2, supra note 4. U.S.C. 78c(f). 2 17 CFR 240.19b–4. VerDate 11 ‘‘Commission’’) the proposed rule ARCHIPELAGO EXCHANGE: ETP INITIAL MEMBERSHIP FEE: 5% of change as described in Items I, II, and FEES AND CHARGES the average price of the last three III below, which Items have been Monthly ETP Fee: $2,000 (Waived) membership sales, with a minimum of prepared by the PCX. The Commission ETP Application Fees— $1,000 and a maximum of $4,000 is publishing this notice to solicit Initial Processing Fee: $350 (Waived) DUES $750: per month per comments on the proposed rule change Investigation Fee: $100 fee per membership from interested persons. applicant for registration as ETP Holder OPTIONS ORIENTATION AND TEST FEE: $1,000 I. Self-Regulatory Organization’s (includes any control person listed on Schedule A of Form BD) or Market [EQUITIES TEST FEE]: [$50 per test] Statement of the Terms of Substance of TRANSFER OF MEMBERSHIP: $250 the Proposed Rule Change Maker Authorized Trader. Fee is also applicable to each Authorized Trader for permanent intra-firm or inter-firm The Exchange proposes to modify its and its designated supervisor associated transfer $100 for temporary intra-firm ‘‘Schedule of Fees and Charges for with an ETP Holder for which PCX is transfer (period less than 30 days) $50 Exchange Services’’ for services it will DEA. for one-day intra-firm transfer offer to ETP Holders 3 and Sponsored Fingerprinting Fee: $30 fee per PURCHASE OF ADDITIONAL Participants 4 that use the new applicant for registration as ETP Holder MEMBERSHIP: $200 per seat purchase electronic trading facility of the (includes any control person listed on SALE OF MEMBERSHIP LEASE Exchange and its wholly-owned Schedule A of Form BD) or Market AGREEMENTS: $200 per seat sale subsidiary PCX Equities, Inc. (‘‘PCXE’’), Maker Authorized Trader. Fee is also Existing Member: $350 per agreement called the Archipelago Exchange applicable to each Authorized Trader Reactivation of Terminated Member: (‘‘ArcaEx’’). The Exchange also proposes and its designated supervisor associated $350 if within 12 months; if over 12 to waive certain application processing with an ETP Holder for which PCX is months, see INITIAL MEMBERSHIP FEE and monthly fees relating to Equity DEA. Trading Permits (‘‘ETPs’’). ASAP MEMBERSHIP FEE ARCHIPELAGO EXCHANGE: (Automated System Access Privilege): Below is the text of the proposed rule MARKET MAKER FEES AND $4,000 per year (non-refundable) change. Proposed new language is CHARGES [PCX CONSTITUTION AND RULES]: italicized; proposed deletions are in [$12 for members] brackets. Market Maker Transaction Credits— Round Lots: $0.001 per share (credit) [(soft cover)]: [$20 for nonmembers] * * * * * (applicable to Q orders executed against REGULATORY FEES— SCHEDULE OF FEES AND CHARGES other participants’ orders) Focus Filing Fee: $25 annual filing fee FOR EXCHANGE SERVICES Odd Lots: $0.02 per share (credit) for member organizations for which the (applicable to any market maker that Exchange is the Designated Examining * * * * * executes against an odd-lot order in the Authority ARCHIPELAGO EXCHANGE: Odd Lot Tracking Order Process, as Registration Fee: $45 annual fee for TRADE RELATED CHARGES defined in PCXE Rule 7.31(g)) new applications, maintenance, or transfer of registration status for each EXCHANGE TRANSACTIONS ARCHIPELAGO EXCHANGE: Registered Representative and each OTHER FEES AND CHARGES ETP Holders and Sponsored Registered Options Principal (collected Participants 5 Primary Connectivity by the NASD) Charge (includes one router and one DEA Fee: 6 $2,000 monthly fee per Round Lots: $0.003 per share circuit): $0 firm $250 annual fee per trader $75 one- (applicable to inbound orders executed Regulatory Fees— time registration fee per trader against orders residing in the Book, and FOCUS Filing Fee: $25 annual filing APPLICATION FOR APPROVED orders routed away and executed by fee for ETP Holders for which the PCX STATUS DESPITE GROUNDS FOR another market center or participant) is the Designated Examining Authority STATUTORY DISQUALIFICATION: Odd Lots: $0.03 per share (applicable Registration Fee: $50 annual fee for $250 fee per application to any inbound odd-lot orders executed new applications, maintenance, or * * * * * against orders residing in the Book, and transfer of registration status for each [PCX EQUITIES: TRADE-RELATED orders routed away and executed by Registered Representative and each CHARGES] another market center or participant) Registered Options Principal (fee collected by NASD). Fee will not apply [EXCHANGE TRANSACTIONS] to an ETP Holder if such broker-dealer 3 See PCXE Rule 1.1(n) (defining ‘‘ETP Holder’’). [Cumulative Billable Shares Per Month] 4 A ‘‘Sponsored Participant’’ means ‘‘a person holds a regular PCX membership. which has entered into a sponsorship arrangement DEA Fee: $2,000 monthly fee per firm [First 4 million shares: $0.31 per 100 with a Sponsoring ETP Holder pursuant to [PCXE] $250 annual fee per trader $75 one-time shares] Rule 7.29.’’ See PCXE Rule 1.1(tt). registration fee per trader [Next 10 million shares: $0.17 per 100 5 These transaction fees do not apply to: (1) Application for Approved Directed Orders, regardless of account type, that are shares] matched within the Directed Order Process; (2) Status Despite Grounds for Statutory [Next 8 million shares: $0.09 per 100 Directed Orders for the account of a retail public Qualification: $250 fee per shares] customer that are executed partially or in their application [Over 22 million shares: $0.05 per 100 entirety via the Directed Order, Display Order, * * * * * Working Order, and Tracking Order processes shares] (however, any unfilled or residual portion of a retail PCX GENERAL OPTIONS customer’s order that is routed away and executed 6 These fees will apply to member organizations by another market center or participant will incur MEMBERSHIP FEES for which the Exchange is the Designated this transaction fee); (3) orders executed in the MEMBERSHIP APPLICATION FEES: Examining Authority. Member organizations that Opening Auction and the Market Order Auction; (4) can demonstrate that at least 25% of their income, Cross Orders; (5) commitments received through $350 initial fee (nonrefundable) $100 as reflected on the most recently submitted FOCUS ITS; and (6) participants in the Nasdaq UTP Plan renewal fee, within six months of Report, was derived from on-floor activities will be that transmit orders via telephone. termination exempt from these charges. VerDate 11 [All trades capped at 20,000 shares.] [INTERMARKET TRADING SYSTEM II. Self-Regulatory Organization’s (ITS)] Statement of the Purpose of, and [OFFBOARD TRADE RECORDING AND Statutory Basis for, the Proposed Rule COMPARISON] [$0.005 per share on net outgoing specialist principal ITS trades, Change [$0.05 per 100 shares for each side of excluding preopening responses (charge In its filing with the Commission, the individual stock, warrant, or rights for for outgoing trades offset by cumulative Exchange included statements offboard trades submitted for credit for incoming trades)] concerning the purpose of and basis for comparison (comparison charges are the proposed rule change and discussed [CARD ACCESS FEE] capped at 20,000 shares per trade side; any comments it received on the minimum of $0.05, maximum of $10).] [$40 per month for member firm proposed rule change. The text of these [$0.03 per $1,000 bond face value for employees needing access to the statements may be examined at the each side of individual bond trade equities floor, but who do not pay a places specified in Item IV below. The submitted for comparison (minimum of floor privilege fee] Exchange has prepared summaries, set $0.03, maximum of $3).] [$100 replacement fee] forth in Sections A, B, and C below, of [AMEX-LISTED ISSUES]: [Trades in [TELEPHONES] the most significant aspects of such AMEX-listed equity issues are not statements. subject to transaction or comparison [$60 per month per 32-button phone] charges.] A. Self-Regulatory Organization’s [(Los Angeles only)] Statement of the Purpose of, and [PCX EQUITIES: FLOOR AND [$45 per month per 16-button phone] Statutory Basis for, the Proposed Rule SPECIALIST FEES] [$9 per month per line] Change [$1 per month per appearance] [ETP FEE]: [$2,000 per month] 1. Purpose [SPECIALIST AND FLOOR BROKER [WIRE SERVICES]: [Pass-through fees] The PCX proposes to modify its fee FEE]: [$2,000 per month] [PACIFIC CLEARING CORPORATION] [EQUITY ASAP HOLDER FEE]: schedule to reflect the variety of [$4,000 per year] [Post Cashiering]: [$2,150 per month] services it proposes to offer to ETP [Post Clearing]: [$2,350 per month] [FLOOR PRIVILEGE FEE]: [$165 per Holders and Sponsored Participants [PCC Symbol Fee]: [$175 per symbol month for each registered floor member (collectively ‘‘Users’’) that access per month charged to non-specialist and registered clerk] ArcaEx. The amended fee schedule will symbols with trade comparison activity] include transaction fees and charges for [SPECIALIST FACILITY FEE]: [$300 [Special Processing Fee]: [$20 per per month service fee per post] a variety of other services, including the balance order for dually traded, NSCC/ installation and maintenance of certain [SPECIALIST SYSTEMS FEE]: [$1,550 DTC-ineligible items (specialists only)] equipment. PCX also proposes to adopt per month per post] * * * * * a transaction credit for registered Market [WORKSTATION FEES] Makers who enhance liquidity by PCX [EQUITIES AND] OPTIONS: entering Q Orders 7 that interact against [Specialists]: [First workstation (three REPORT FEES PCs) included in Specialist Systems other Users’ orders on ArcaEx. In Fee] [EQUITIES REPORTS] addition, the PCX represents that, [Brokers]: [$175 per month] [Transaction Blotter Report] because it is PCXE’s intent to operate the ArcaEx facility in place of the [Additional PCs]: [$175 per month per [No fee for first copy] PCXE’s traditional floor trading PC (plus additional wire service [$30 per month for each additional environment, it proposes to eliminate charges)] copy] all of the current fees and charges [MARKET DATA FEE] [Security Ledger Report] related to floor trading of equity [Specialists]: [$400 per month per securities on the Exchange. The [No fee for first copy] proposed changes to the Exchange’s post for base services, plus wire service [$30 per month for each additional charges] ‘‘Schedule of Fees and Charges for copy] Exchange Services’’ are discussed [Brokers]: [$200 per month per broker [Trade Activity Data Extract]: [$150 below. for base services, plus wire services per month per clearing symbol] charges] [Security Ledger Data Extract]: [$150 a. Background [SUPPLEMENTAL SPECIALIST POST per month plus $250 initial set-up fee] On October 25, 2001, the Commission FEE]: [$6,750 per month per [MIS Reports (various)]: [$50 per approved a proposed rule change by the consolidated post] month plus development and set-up PCX to establish ArcaEx, a new costs] [ALTERNATE SPECIALIST FEES] electronic trading facility of PCXE.8 OPTIONS REPORTS ArcaEx is an electronic securities [$200 initial registration fee] trading facility for use by ETP Holders Standard Report Package: $55 per $100 initial fee for each issue traded] and their customers. ArcaEx will month per symbol, plus $0.0055 per [$50 ongoing monthly fee for each provide automatic order execution contract, to a maximum of $550 per issue traded] capabilities in securities listed or traded month [$5 transaction charge per outgoing on the PCXE, and will operate in place offboard order (charge for outgoing User Activity Extracts (Batch): $0.0075 per trade plus development and orders offset by cumulative credit for 7 Q Orders are limit orders that are submitted to non ITS alternate specialist executions)] set-up costs ArcaEx by a Market Maker in those securities in Online Data Extract: $500 per month which the Market Maker is registered to trade. See [FLOOR BROKER BOOTHS] SPECIALIZED REPORT, PRINTING PCXE Rule 7.31(k). [$125 per month for small booth] AND PROCESSING: Development and 8 See Securities Exchange Act Release No. 44983 (October 25, 2001), 66 FR 55225 (November 1, 2001) [$250 per month for large booth] production costs (File No. SR–PCX–00–25) (order approving the [$375 per month for area booth] * * * * * ArcaEx as the equities trading facility of PCXE). VerDate 11 of PCXE’s traditional floor trading matched within the Directed Order to each Authorized Trader 17 (including environment. PCX and PCXE will be Process; 11 (2) Directed Orders for the any person that is responsible for responsible for all regulatory functions account of a retail public customer that supervising such Authorized Trader) related to the facility, and Archipelago are executed partially or in their entirety that is associated with an ETP Holder Exchange, L.L.C. (‘‘Archipelago’’), a via the other order processes; 12 (3) for which the PCX is the Designated subsidiary of Archipelago Holdings, orders executed in the Opening Auction Examining Authority (‘‘DEA’’). The L.L.C., will be responsible for the and the Market Order Auction; 13 (4) Exchange represents that these fees are business of the facility to the extent that Cross Orders; 14 (5) commitments intended to recover the Exchange’s these activities are not inconsistent with received through the Intermarket administrative expenses in connection the regulatory and oversight functions of Trading System; and (6) participants in with the ETP application process. PCX and PCXE. the Nasdaq/National Market System/ iii. Market Maker Transaction Credits b. Proposed Fees Unlisted Trading Privileges Plan that transmit orders via telephone.15 Under the proposed fee structure, The Exchange proposes to modify its registered Market Makers will receive a fees applicable to its equities business (B) Odd and Mixed Lots credit of $0.001 per share for any Q by adopting transaction fees and other The Exchange proposes to charge a fee Orders they have entered that are charges relating to the ArcaEx facility. of $0.03 per share for executed orders executed against Users’ orders. In The proposed fees will be divided into that are initially entered as odd lot addition, $0.02 per share will be four principal categories. The first orders (this includes the odd lot portion credited to any Market Maker that category will relate to transaction fees. of a mixed lot). This charge will not executes against an odd lot order in the The second category will include apply to odd lot orders that were created Odd Lot Tracking Order Process.18 The certain administrative fees in as a result of a partial fill of a round lot Exchange represents that these credits connection with the ETP application order. are intended to provide an incentive to process. The third category will cover firms to become Market Makers and to fees, charges, and credits applicable to ii. ETP Fees and Charges build liquidity in the ArcaEx Book, registered Market Makers. The fourth The PCX, initially, proposes not to which will foster price competition and category will include all other fees, charge an ETP application fee or a order interaction. charges, and credits. The items in these monthly ETP fee. The PCX, however, iv. Other Fees and Charges categories are discussed separately proposes to assess a $100 fee for the below. required background check and a $30 (A) User Connectivity Fees i. Transaction Fees fingerprinting fee per applicant for The Exchange represents that registration as an ETP Holder (including Archipelago will be responsible for User (A) General any control person listed on Schedule A connectivity to ArcaEx. This will The Exchange proposes to charge all of Form BD) or Market Maker include initiating contracts, trading Users a transaction fee of $0.003 per Authorized Trader.16 The Exchange connections, and User set-up. Only share for orders that take liquidity from represents that the background check those Users that have been approved by the ArcaEx Book 9 and for orders that and fingerprinting fees will also apply PCXE are authorized to enter into are routed away to another market transactions on ArcaEx. There will be 10 center or participant. In other words, 11 The Directed Order Process is the first step in no charge for the primary connection any order entered by a User that the ArcaEx execution algorithm. Through this and router to the ArcaEx trading facility; executes against an order residing in the process, Users may direct an order to a Market however, redundant or additional Book, or any unfilled or residual portion Maker with whom they have a relationship and the Market Maker may execute the order. To access this connections will incur a charge. Those of an order that is routed away and process, the User must submit a Directed Order, Users who wish to obtain additional executed by another market center or which is a market or limit order to buy or sell that connections to the facility will have to participant, will incur this transaction has been directed to the a particular market maker pay the actual charges incurred by fee. The Exchange represents that this by the User. See PCXE Rule 7.37(a) (description of ‘‘Directed Order Process’’). Archipelago or the service provider proposed fee structure will have the 12 If a retail public customer order has not been retained for the work being performed. effect of attracting resting limit orders executed in its entirety after progressing through (B) Regulatory Fees into the Book, which will help promote the Directed Order, Display Order, Working Order, liquidity, transparency, and, in turn, and Tracking Order Processes, the remaining PCX proposes to adopt the following price discovery. The Exchange notes portion of such order, if eligible, will be routed to regulatory fees: (1) a $25 annual FOCUS another market center or participant. Any executed that this proposed transaction fee will portion of that order will be subject to the proposed filing fee for ETP Holders for which the not apply to: (1) Directed Orders, transaction fee. Exchange is the DEA; (2) a $50 annual regardless of account type, that are 13 See PCXE Rules 7.35(b) and (c) for a detailed fee to all registered representatives and description of the Opening Auction and the Market registered options principals for Order Auction, respectively. 9 ArcaEx will maintain an electronic file of maintenance, new applications, or 14 A Cross Order is defined as a two-sided order orders, called the ArcaEx Book, through which transfer of registration status; 19 (3) DEA orders will be displayed and matched. The ArcaEx with instructions to match the identified buy-side Book will be divided into four components, called with the identified sell-side at a specified price (the processes—the Directed Order Process, the Display cross price), subject to price improvement 17 See PCXE Rule 1.1(g) (defining ‘‘Authorized Order Process, the Working Order Process, and the requirements. See PCXE Rule 7.31(s). Trader’’). Tracking Order Process. See PCXE Rules 7.36 and 15 See Joint Self-Regulatory Organization Plan 18 The Tracking Order Process is the fourth step 7.37, for a detailed description of these order Governing the Collection, Consolidation and of the ArcaEx execution algorithm. If the unfilled execution processes. Dissemination of Quotation and Transaction marketable order (or portion of an order) that enters 10 The fifth step of the ArcaEx execution Information for Exchange-Listed Nasdaq/National the Tracking Order Process is an odd lot, such order algorithm involves routing orders away to other Market System Securities Traded on Exchanges on will be executed against a market maker that is market centers or market participants. This will an Unlisted Trading Privilege Basis, Section IX registered as an Odd Lot Dealer. See PCXE Rules occur if there are no opportunities to match an (‘‘Market Access’’), Securities Exchange Act Release 7.31(g) and 7.37(c). order within ArcaEx, or to access the best price No. 45081 (November 19, 2001), 66 FR 59273 19 The Exchange represents that, to avoid available in the market. Routing is available only to (November 27, 2001). duplicative billing, the annual fee charged to all those ETP Holders who have entered into a Routing 16 See PCXE Rule 1.1(v) (defining ‘‘Market Maker registered representatives and options principals Agreement. See PCXE Rule 7.37(d). Authorized Trader’’). Continued VerDate 11 fees for trading firms and their necessary or appropriate in furtherance For the Commission, by the Division of traders; 20 and (4) a $250 fee per of the purposes of the Act. Market Regulation, pursuant to delegated application for approved status despite authority.26 C. Self-Regulatory Organization’s grounds for statutory disqualification. Statement on Comments on the J. Lynn Taylor, The PCX represents that these fees are Proposed Rule Change Received From Assistant Secretary. consistent with the PCX’s current fee Members, Participants or Others [FR Doc. 02–8486 Filed 4–8–02; 8:45 am] structure, and are intended to offset BILLING CODE 8010–01–P costs related to regulatory oversight and No written comments were solicited enforcement. or received with respect to the proposed rule change. c. Applicability of Existing PCXE Fees SECURITIES AND EXCHANGE III. Date of Effectiveness of the COMMISSION In addition to the new proposed fees Proposed Rule Change and Timing for set forth above, the PCX proposes to Commission Action delete from its current fee structure the [Release No. 34–45681; File No. SR-PHLX– following fees, which relate primarily to The foregoing rule change has become 2002–19] floor trading and specialists or are effective pursuant to Section 19(b)(3)(A)(ii) 23 of the Act and Self-Regulatory Organizations; Notice otherwise inapplicable to the new 24 trading environment: (1) Transaction subparagraph (f)(2) of Rule 19b–4 of Filing and Immediate Effectiveness and comparison charges (including fees thereunder because it establishes or of Proposed Rule Change by the that are paid by specialists firms to the changes a due, fee, or other charge Philadelphia Stock Exchange, Inc. Pacific Clearing Corporation for imposed by the Exchange. At any time Relating to Increasing the Amount of providing trade settlement and within 60 days of the filing of such the Late Charge Imposed Pursuant to proposed rule change, the Commission processing services); (2) systems and Exchange Rule 50 may summarily abrogate such rule communication equipment related change if it appears to the Commission charges (including booth fees and April 2, 2002. that such action is necessary or market data services provided by third Pursuant to section 19(b)(1) of the appropriate in the public interest, for party vendors to ETP Firms through the Securities Exchange Act of 1934 the protection of investors, or otherwise PCXE on a pass through basis); and (3) 1 2 in furtherance of the purposes of the (‘‘Act’’), and Rule 19b–4 thereunder, charges for various trade information Act.25 notice is hereby given that on March 15, and clearing reports that are produced 2002, the Philadelphia Stock Exchange, by PCXE for ETP Firms. IV. Solicitation of Comments Inc. (‘‘Phlx’’ or ‘‘Exchange’’) filed with 2. Statutory Basis Interested persons are invited to the Securities and Exchange submit written data, views, and Commission (‘‘Commission’’) the The Exchange believes that the arguments concerning the foregoing, proposed rule change as described in proposed rule change is consistent with including whether the proposed rule Items I, II, and III below, which Items the provisions of Section 6(b) of the change is consistent with the Act. 21 have been prepared by the Phlx. The Act, in general, and Section 6(b)(4) of Persons making written submissions 22 Commission is publishing this notice to the Act, in particular, in that it should file six copies thereof with the provides for the equitable allocation of solicit comments on the proposed rule Secretary, Securities and Exchange change from interested persons. reasonable dues, fees and other charges Commission, 450 Fifth Street, NW, among its members. Washington, DC 20549–0609. Copies of I. Self-Regulatory Organization’s B. Self-Regulatory Organization’s the submission, all subsequent Statement of the Terms of Substance of Statement on Burden on Competition amendments, all written statements the Proposed Rule Change with respect to the proposed rule The Exchange does not believe that change that are filed with the The Phlx proposes to amend the the proposed rule change will impose Commission, and all written amount of the late charge that is any burden on competition that is not communications relating to the imposed by the Phlx as set forth in Phlx proposed rule change between the Rule 50. Currently, the late charge is set will not apply to an ETP Holder if such broker- at a rate of 1 percent simple interest for dealer holds a regular PCX membership. Commission and any person, other than 20 The DEA fees include a $2,000 monthly fee per those that may be withheld from the each thirty-day period or fraction firm, a $250 annual fee per trader, and a $75 one- public in accordance with the thereof, calculated on a daily basis, time registration fee per trader. provisions of 5 U.S.C. 552, will be during which accounts payable to the Under the current PCX fee schedule, an available for inspection and copying in Exchange remain outstanding at least exemption from these DEA fees will be granted to the Commission’s Public Reference any member operating from the PCX trading floor thirty-one days. The Exchange proposes that has demonstrated that at least 25% of its Room. Copies of such filing will also be to increase the amount of the late charge income (as reflected on the most recently submitted available for inspection and copying at from 1 percent to 1.5 percent. All other FOCUS Report) was derived from on-floor the principal office of the PCX. All provisions relating to the Exchange’s activities. This exemption has not been included in submissions should refer to File No. the proposed fee schedule for ArcaEx because it is late charge as specified in Rule 50 SR–PCX–2002–16 and should be inapplicable to the new trading environment. The would remain the same. PCX indicated that it intends to retain this submitted by April 30, 2002. exemption for options. A technical correction was The text of the proposed rule change made to the proposed rule text to indicate the 23 15 U.S.C. 78s(b)(3)(A)(ii). is available at the Office of the retention of this exemption under the ‘‘PCX General 24 17 CFR 240.19b–4(f)(2). Secretary, the Phlx, and the Options Membership Fees.’’ Telephone 25 For purposes of calculating the 60-day period Commission. conversation between Peter D. Bloom, Regulatory within which the Commission may summarily Policy, PCX, and Sapna C. Patel, Attorney, Division abrogate the proposed rule change under Section of Market Regulation, Commission, on April 1, 19(b)(3)(C) of the Act, the Commission considers 26 17 CFR 200.30–3(a)(12). 2002. that period to commence on March 20, 2002, the 21 15 U.S.C. 78f(b). date the PCX filed the proposed rule change. See 1 15 U.S.C. 78s(b)(1). 22 15 U.S.C. 78f(b)(4). 15 U.S.C. 78s(b)(3)(C). 2 17 CFR 240.19b-4. VerDate 11 II. Self-Regulatory Organization’s C. Self-Regulatory Organization’s SMALL BUSINESS ADMINISTRATION Statement of the Purpose of, and Statement on Comments on the [Declaration of Disaster #3402] Statutory Basis for, the Proposed Rule Proposed Rule Change Received from Change Members, Participants, or Others State of Texas; Disaster Loan Areas The Exchange has neither solicited In its filing with the Commission, the Bexar County and the contiguous nor received any written comments on counties of Atascosa, Bandera, Comal, Phlx included statements concerning the proposed rule change. the purpose of, and basis for, the Guadalupe, Kendall, Medina and proposed rule change and discussed any III. Date of Effectiveness of the Wilson in the State of Texas constitute comments it received on the proposed Proposed Rule Change and Timing for a disaster area as a result of damages rule change. The text of these statements Commission Action caused by severe storms and flooding may be examined at the places specified Because the foregoing proposed rule that occurred on March 19, 2002. in Item IV below. The Phlx has prepared change establishes or changes a due, fee, Applications for loans for physical summaries, set forth in Sections A, B, or charge imposed by the Exchange, it damage as a result of this disaster may and C below, of the most significant has become effective upon filling be filed until the close of business on aspects of such statements. pursuant to section 19(b)(3)(A) of the May 31, 2002, and for economic injury Act,5 and Rule 19b–4(f)(2) 6 thereunder. until the close of business on January 2, A. Self-Regulatory Organization’s At any time within 60 days of the filing 2003, at the address listed below or Statement of the Purpose of, and of such proposed rule change, the other locally announced locations: Statutory Basis for, the Proposed Rule Commission may summarily abrogate U.S. Small Business Administration, Change such rule change if it appears to the Disaster Area 3 Office, 4400 Amon Carter Blvd., Suite 102, Ft. Worth, TX 1. Purpose Commission that such action is necessary or appropriate in the public 76155. The interest rates are: The Exchange is proposing to increase interest, for the protection of investors, the amount of the late charge imposed or otherwise in furtherance of the For Physical Damage: Percent by the Exchange from 1 percent to 1.5 purposes of the Act. Homeowners with credit available percent in order to encourage members elsewhere ...... 6.625 IV. Solicitation of Comments Homeowners without credit avail- to pay, on a timely basis, monies due Interested persons are invited to able elsewhere ...... 3.312 and owed the Exchange, which, in turn, Businesses with credit available submit written data, views and should deter the practice of late elsewhere ...... 7.000 arguments concerning the foregoing, payments. Businesses and non-profit organiza- including whether the proposed rule tions without credit available The Exchange notes that the proposed change is consistent with the Act. elsewhere ...... 3.500 Others (including non-profit organi- fee change will be effective with respect Persons making written submissions zations) with credit available else- to all account receivable balances that should file six copies thereof with the where ...... 6.375 are due to Phlx on or after April 1, 2002. Secretary, Securities and Exchange For Economic Injury: Businesses and Thus, delinquent balances due in March Commission, 450 Fifth Street, NW, small agricultural cooperatives with- out credit available elsewhere ...... 3.500 at a rate of 1 percent will be charged a Washington, DC 20549–0609. Copies of rate of 1.5 percent effective April 1, the submission, all subsequent The numbers assigned to this disaster 2002. amendments, all written statements are 340211 for physical damage and with respect to the proposed rule 9P0300 for economic injury. 2. Statutory Basis change that are filed with the Commission, and all written The Exchange believes that the (Catalog of Federal Domestic Assistance communications relating to the Program Nos. 59002 and 59008). proposed rule change is consistent with proposed rule change between the Dated: April 1, 2002. section 6(b) of the Act 3 in general, and Commission and any person, other than Hector V. Barreto, furthers the objectives of section 6(b)(4) those that may be withheld from the Administrator. of the Act 4 in particular, in that it is an public in accordance with the [FR Doc. 02–8460 Filed 4–8–02; 8:45 am] equitable allocation of reasonable dues, provisions of 5 U.S.C. 552, will be BILLING CODE 8025–01–P fees, and other charges among the available for inspection and copying in Exchange’s members who do not make the Commission’s Public Reference timely payments to the Exchange. The Room. Copies of such filing will also be SMALL BUSINESS ADMINISTRATION Exchange also believes that the higher available for inspection and copying at interest rate should encourage prompt the principal office of the Phlx. All Notice of Action Subject to payment of monies due and owed the submissions should refer to File No. Intergovernmental Review Under Exchange. SR–Phlx–2002–19 and should be Executive Order 12372 submitted by April 30, 2002. B. Self-Regulatory Organization’s AGENCY: Small Business Administration. Statement on Burden on Competition For the Commission, by the Division of ACTION: Notice of Action Subject to Market Regulation, pursuant to delegated 7 Intergovernmental Review Under The Exchange does not believe that authority. Executive Order 12372. the proposed rule change will impose Margaret H. McFarland, any burden on competition that is not Deputy Secretary. SUMMARY: The Small Business necessary or appropriate in furtherance [FR Doc. 02–8515 Filed 4–8–02; 8:45 am] Administration (SBA) is notifying the of the purposes of the Act. BILLING CODE 8010–01–P public that it intends to grant the pending applications of 22 existing 5 15 U.S.C. 78s(b)(3)(A). Small Business Development Centers 3 15 U.S.C. 78f(b). 6 17 CFR 240.19b–4(f)(2). (SBDCs) for refunding on October 1, 4 15 U.S.C. 78f(b)(4). 7 17 CFR 240.30–3(a)(12). 2002, subject to the availability of funds. VerDate 11 Four states do not participate in the Mr. Max Summers, State Director, SBDC Program Organization Executive Order 12372 process; University of Missouri, Suite 300, The lead SBDC operates a statewide therefore, their addresses are not University Place, Columbia, MO or regional network of SBDC service included. A short description of the 65211 (573) 882–0344 centers. An SBDC must have a full-time SBDC program follows in the Mr. Ronald Manning, State Director, Director. SBDCs must use at least 80 supplementary information below. Iowa State University, 137 Lynn percent of the Federal funds to provide The SBA is publishing this notice at Avenue, Ames, IA 50010, (515) 292– services to small businesses. SBDCs use least 120 days before the expected 6351 volunteers and other low cost resources refunding date. The SBDCs and their Mr. James L. King, State Director, State as much as possible. mailing addresses are listed below in University of New York, SUNY Plaza, SBDC Services the address section. A copy of this S–523, Albany, NY 12246, (518) 443– notice also is being furnished to the 5398 An SBDC must have a full range of respective State single points of contact Ms. Holly Schick State Director, State business development and technical designated under the Executive Order. assistance services in its area of Each SBDC application must be Director, Ohio Department of Development, 77 South High Street, operations, depending upon local needs, consistent with any area-wide small SBA priorities and SBDC program business assistance plan adopted by a Columbus, OH 43226–1001, (614) 466–2711 objectives. Services include training and State-authorized agency. counseling to existing and prospective Mr. Donald L. Kelpinski, State Director, DATES: A State single point of contact small business owners in management, Vermont Technical College, P.O. Box and other interested State or local marketing, finance, operations, 188, Randolph Center, VT 05061– entities may submit written comments planning, taxes, and any other general 0188, (802) 728–9101 regarding an SBDC refunding within 30 or technical area of assistance that days from the date of publication of this Mr. Warren Bush, SBDC Director, supports small business growth. notice to the SBDC. University of the Virgin Islands, 8000 The SBA district office and the SBDC ADDRESSES: Nisky Center, Suite 720, St. Thomas, must agree upon the specific mix of US VI 00802–5804, (340) 776–3206 services. They should give particular Addresses of Relevant SBDC State Ms. Carmen Marti, SBDC Director, Inter attention to SBA’s priority and special Directors American University, Ponce de Leon emphasis groups, including veterans, Mr. Robert McKinley, Region Director, Avenue, #416, Edificio Union Plaza, women, exporters, the disabled, and Univ. of Texas at San Antonio, 1222 Suite 7-A, Hato Rey, PR 00918, (787) minorities. North Main Street, San Antonio, TX 763–6811 SBDC Program Requirements 78212, (210) 458–2450 FOR FURTHER INFORMATION CONTACT: Mr. Conley Salyer, State Director, West Johnnie L. Albertson, Associate An SBDC must meet programmatic Virginia Development Office 950 Administrator for SBDCs, U.S. Small and financial requirements imposed by Kanawha Boulevard, East, Charleston, Business Administration, 409 Third statute, regulations or its Cooperative WV 25301, (304) 558–2960 Street, SW, Suite 4600, Washington, DC Agreement. The SBDC must: Mr. Dennis Gruell, State Director, (a) locate service centers so that they 20416. University of Connecticut, 2100 are as accessible as possible to small Hillside Road, U Box 1094, Storrs, CT SUPPLEMENTARY INFORMATION: businesses; 06269–1094, (860) 486–4135 Description of the SBDC Program (b) open all service centers at least 40 Mr. Clinton Tymes, State Director, hours per week, or during the normal University of Delaware, One A partnership exists between SBA business hours of its state or academic Innovation Way, Suite 301, Newark, and an SBDC. SBDCs offer training, Host Organization, throughout the year; DE 19711, (302) 831–2747 counseling and other business (c) develop working relationships Mr. Michael Young, Region Director, development assistance to small with financial institutions, the University of Houston, 2302 Fannin, businesses. Each SBDC provides investment community, professional Suite 200, Houston, TX 77002, (713) services under a negotiated Cooperative associations, private consultants and 752–8425 Agreement with SBA, the general small business groups; and Ms. Becky Naugle, State Director, management and oversight of SBA, and (d) maintain lists of private University of Kentucky, 225 Gatton a state plan initially approved by the consultants at each service center. College of Business Economics, Governor. Non-Federal funds must Dated: April 2, 2002. Lexington, KY 40506–0034, (859) match Federal funds. An SBDC must Johnnie L. Albertson, 257–7668 operate according to law, the Ms. Liz Klimback, Region Director, Associate Administrator for Small Business Cooperative Agreement, SBA’s Development Centers. Dallas Community College, 1402 regulations, the annual Program [FR Doc. 02–8461 Filed 4–8–02; 8:45 am] Corinth Street, Dallas, TX 75212, Announcement, and program guidance. (214) 860–5835 BILLING CODE 8025–01–P Ms. Rene Sprow, State Director, Univ. of Program Objectives Maryland @ College Park, 7100 The SBDC program uses Federal SMALL BUSINESS ADMINISTRATION Baltimore Avenue, Suite 401, funds to leverage the resources of states, Baltimore, MD 20742–1815, (301) academic institutions and the private Public Federal Regulatory 403–8300 sector to: Enforcement Fairness Roundtable; Mr. Craig Bean, Region Director, Texas (a) strengthen the small business Region III Regulatory Fairness Board Tech University, 2579 South Loop community; 289, Suite 114, Lubbock, TX 79423– The Small Business Administration 1637, (806) 745–3973 (b) increase economic growth; Region III Regulatory Fairness Board Ms. Diane Wolverton, State Director, (c) assist more small businesses; and and the SBA Office of the National University of Wyoming, P.O. 3922, (d) broaden the delivery system to Ombudsman will hold a Public Laramie, WY 82071, (307) 766–3505 more small businesses. Roundtable on Wednesday, April 17, VerDate 11 2002 at 1 p.m. at the Mezzanine, 405 DEPARTMENT OF TRANSPORTATION Management System website at: http:// Capitol Street, Charleston, West dms.dot.gov. Click on ‘‘Help,’’ ‘‘DMS Virginia, to provide small business Office of the Secretary Web Help,’’ or ‘‘DMS Frequently Asked owners and representatives of trade Questions’’ to obtain instructions for [Docket No. OST–01–10380] associations with an opportunity to filing a document electronically. share information concerning the Hazardous Materials: Knowledge The Dockets Management System is federal regulatory enforcement and Required for Civil Penalty Enforcement located on the Plaza Level of the Nassif compliance environment. Proceedings Building at the above address. You may Anyone wishing to attend or to make review public dockets there between the AGENCY: a presentation must contact Stephen M. Office of the Secretary, DOT. hours of 9:00 a.m. and 5:00 p.m., Glass in writing or by fax, in order to be ACTION: Notice of public meeting and Monday through Friday, except public put on the agenda. Stephen M. Glass, invitation to comment. holidays. You may also review District Counsel for the U.S. Small comments on-line at the DOT Dockets SUMMARY: Interested parties are invited Business Administration, West Virginia Management System website at: http:// to submit comments for consideration District Office, 320 West Pike Street, dms.dot.gov. by DOT in developing additional Suite 330, Clarksburg, WV 26301, phone FOR FURTHER INFORMATION CONTACT: guidance as to when a reasonable 1 (800) 767–8052 press 8 for West LCDR Thomas Sherman, Intermodal person offering, accepting or Virginia and then ext. 229, fax (304) Hazardous Materials Programs, Office of transporting a hazardous material in 623–0023, e-mail: the Associate Deputy Secretary, U.S. commerce would be deemed to have [email protected]. Department of Transportation, 400 knowledge of facts giving rise to a Seventh Street, SW, Washington, DC For more information, see our Web violation of Federal hazardous material 20009. Telephone: 202–366–5846; Fax: site at www.sba.gov/ombudsman. transportation law or the Hazardous 202–366–0263; or E-mail (preferred): Dated: March 29, 2002. Materials Regulations. [email protected]. Michael L. Barrera, DATES: Public meeting. The public SUPPLEMENTARY INFORMATION: National Ombudsman. meeting will be held on June 19, 2002, Federal hazardous material [FR Doc. 02–8458 Filed 4–8–02; 8:45 am] from 9 a.m. to 4 p.m. The meeting will transportation law provides that DOT end before 4:00 p.m. if all topics have BILLING CODE 8025–01–P may assess a civil penalty against a been addressed and all participants person that ‘‘knowingly violates’’ that heard. law or the HMR. 49 U.S.C. 5123(a)(1). SMALL BUSINESS ADMINISTRATION Comments. Written comments must The same section of the law also states be received by July 19, 2002. that Public Federal Regulatory ADDRESSES: Public meeting. The public Enforcement Fairness Hearing; Region meeting will be held in Room 2201 of A person acts knowingly when— VII Regulatory Fairness Board (A) the person has actual knowledge of the the U.S. Department of Transportation facts giving rise to the violation; or headquarters building (Nassif Building), The Small Business Administration (B) a reasonable person acting in the 400 Seventh Street, SW, Washington, circumstances and exercising reasonable care Region VII Regulatory Fairness Board DC 20590–0001. Any person desiring to would have that knowledge. and the SBA Office of the National attend the public meeting must notify Ombudsman will hold a Public Hearing This statutory definition of LCDR Thomas Sherman by telephone or ‘‘knowingly’’ was added in the on Monday, April 29, 2002 at 12:30 p.m. e-mail (see FOR FURTHER INFORMATION at the Wichita Area Chamber of Hazardous Materials Transportation CONTACT below) no later than June 5, Uniform Safety Act of 1990 (HMTUSA), Commerce, 350 W. Douglas, Wichita, 2002, in order to facilitate entry to the Kansas 67202–2970, to receive Public Law 101–615, section 12, 104 Nassif Building. It is recommended Stat. 3259 (Nov. 16, 1990), to ‘‘cover comments and testimony from small attendees arrive early to facilitate new business owners, small government violations that are committed enhanced building security procedures. negligently’’ and to ‘‘negate any entities, and small non-profit Each person should indicate which of organizations concerning the regulatory inference that the term only the four topics described at the end of encompasses actions based on actual enforcement and compliance actions this notice that he or she wishes to taken by federal agencies. knowledge or reckless actions.’’ H. discuss. Report No. 101–444, Part 1, Committee Anyone wishing to attend or to make For information on facilities or on Energy and Commerce, p. 47 (Apr. 3, a presentation must contact Edgar services for individuals with disabilities 1990) (emphasis in original).1 Poindexter in writing or by fax, in order or to request special assistance at the to be put on the agenda. Edgar meeting, contact LCDR Sherman as soon 1 In its regulations, the Research and Special Poindexter, U.S. Small Business as possible. Programs Administration (RSPA) had implemented Administration, Wichita District Office, Comments. You must address the ‘‘knowingly’’ standard for assessment of a civil 271 West Third Street North, Suite comments to the Dockets Management penalty in the original Hazardous Material Transportation Act, Pub. L. 93–633, section 110, 88 2500, Wichita, KS 67202–1212, phone System, U.S. Department of Stat. 2160 (Jan. 3, 1975), and defined ‘‘knowingly’’ (316) 269–6631, fax (316) 269–6618, e- Transportation, Room PL–401, 400 to mean that a person (1) has actual knowledge of mail: [email protected] Seventh Street, SW, Washington, DC the facts that give rise to the violation, or (2) should 20590–0001. You must identify the have known of the facts that give rise to the For more information, see our Web violation. A person knowingly commits an act if the site at www.sba.gov/ombudsman. docket number (OST–01–10380) and act is done voluntarily and intentionally. submit two copies of your comments. If Dated: March 29, 2002. Former 49 CFR 107.299, added 48 FR 2653 (Jan. you want to confirm that we received 20, 1983), revised 56 FR 8624 (Feb. 28, 1991), Michael L. Barrera, your comments, include a self- moved to 49 CFR 107.3 (Definitions), 61 FR 21094 National Ombudsman. (May 9, 1996). When RSPA revised § 107.299 in addressed, stamped postcard. 1991 to define ‘‘knowingly’’ consistent with the [FR Doc. 02–8459 Filed 4–8–02; 8:45 am] You may also submit comments by e- language adopted in HMTUSA, it noted that BILLING CODE 8025–01–P mail by accessing the DOT Dockets Continued VerDate 11 In a letter to the Secretary of hidden shipment to find a knowing violation material is present, and (b) when a Transportation, Federal Express of the HMR. hazardous material is present, whether Corporation asked DOT to develop Information concerning the contents of it is properly packaged, marked, labeled, suspicious packages must be pursued to further guidance on what constitutes determine whether hazardous materials have placarded, and described on a shipping ‘‘constructive knowledge’’ that a carrier been improperly offered. A carrier’s paper. is deemed to have of the presence of employees who accept packages for 3. When a reasonable person should hazardous materials when the carrier transportation must be trained to recognize a have constructive knowledge of the accepts a shipment for transportation. ‘‘suspicious package,’’ as part of their potential presence of a hazardous Federal Express stated that carriers lack function-specific training as specified in 49 material based on information that is ‘‘essential criteria defining constructive CFR 172.704(a)(2), because the legal standard readily apparent from: (a) knowledge of undeclared hazardous remains the knowledge that a reasonable Documentation that accompanies a person acting in the circumstances and materials, that would allow the carriers exercising reasonable care would have.3 shipment, (b) markings, labels, or to design and implement a viable placards on packagings, outside system for training their employees, and 63 FR at 30412. containers, or overpacks, and (c) the for identifying and reporting In an interim response to Federal condition of the packagings, outside discrepancies, without being subjected Express’s attorney, the Secretary of containers, or overpacks themselves. to second-guessing after a shipment has Transportation advised that DOT’s 4. Methods used to train personnel been transported.’’ Director, Intermodal Hazardous who prepare materials for shipment or Materials Programs (IHMP), located In its letter, Federal Express referred accept shipments for transportation to within the Office of the Associate to a formal interpretation published in recognize the potential presence of a Deputy Secretary and Director, Office of the Federal Register on June 4, 1998. 63 hazardous material based on Intermodalism,4 would be the focal FR 30411. In that interpretation, which information that is readily apparent, point in developing possible guidance was coordinated among all the DOT including the use of checklists such as on ‘‘constructive knowledge.’’ In agencies to which enforcement those required by Section 7;1.3 of the conjunction with FAA (TSA), FMCSA, authority has been delegated,2 RSPA’s Technical Instructions for the Transport FRA, RSPA, and USCG, the Director of Chief Counsel stated that: of Dangerous Goods of the International IHMP invites interested parties to attend Civil Aviation Organization (ICAO). a carrier knowingly violates the HMR when a public meeting and to comment at that the carrier accepts or transports a hazardous meeting or separately in writing on the Oral comments at the public meeting material with actual or constructive indicia or readily apparent facts that and separate written comments are not knowledge that a package contains a would indicate the potential presence of limited to the above topics and may hazardous material which has not been hazardous materials to a reasonable include any suggestions for developing packaged, marked, labeled, and described on additional guidance as to when a a shipping paper as required by the HMR. person and the actions that a reasonable person should take in response to those reasonable person would be deemed to This means that a carrier may not ignore have constructive knowledge of the readily apparent facts that indicate that either indicia or readily apparent facts. (1) a shipment declared to contain a Logical topics for discussion at the potential presence of hazardous material hazardous material is not properly packaged, public meeting and in written and the manner in which that material marked, labeled, placarded, or described on comments include: is classified, packaged, marked, labeled, a shipping paper, or (2) a shipment actually 1. The responsibilities of an offeror of placarded, and described on a shipping contains a hazardous material governed by a hazardous material to properly classify paper. A facilitator will chair the the HMR despite the fact that it is not the material, package the material, mark meeting to ensure that all topics are marked, labeled, placarded, or described on and label packagings, outside covered and persons heard. No formal a shipping paper as containing a hazardous transcript of this meeting is planned, material. containers, and overpacks, describe the material on a shipping paper, and but the meeting will be tape recorded * * * * * provide placards to a carrier. for later use by DOT in its decision- In the case of an undeclared or hidden 2. The responsibilities of a carrier making process. shipment, all relevant facts must be considered to determine whether or not a when it accepts any shipment to review Issued in Washington, DC on April 3, 2002. reasonable person acting in the documentation that accompanies the Jackie A. Goff, circumstances and exercising reasonable care shipment and inspect the packagings, Director, Intermodal Hazardous Materials would realize the presence of hazardous outside containers, or overpacks to Programs, Office of the Associate Deputy materials. In an enforcement proceeding, this determine (a) whether a hazardous Secretary. is always a question of fact, to be determined [FR Doc. 02–8521 Filed 4–8–02; 8:45 am] by the fact-finder. Because innumerable fact 3 In its June 14, 1996 Advisory Guidance; BILLING CODE 4910–62–P patterns may exist, it is not practicable to set Offering, Accepting, and Transporting Hazardous forth a list of specific criteria to govern Materials, 61 FR 30444, 30446, RSPA urged persons whether or not the carrier has sufficient ‘‘who engage in day-to-day transportation activities constructive knowledge of the presence of [to] make a concerted effort to ensure their own DEPARTMENT OF TRANSPORTATION hazardous materials within an undeclared or compliance, as well as that of others from whom they receive shipments’’ and reminded them to: (1) Federal Motor Carrier Safety ‘‘Know Your Customer,’’ (2) ‘‘Know the Packaging,’’ Administration ‘‘Congress effectively adopted the Department’s (3) ‘‘Know/Verify the Proper Hazardous Material historic interpretation of the term ‘knowingly.’’’ 56 Description,’’ (4) ‘‘Visually Inspect Shipments,’’ (5) FR 8620. ‘‘Advise Your Customer of Possible Discrepancies,’’ [Docket Nos. FMCSA–99–5748 (OMCS–99– 2 The Secretary of Transportation has delegated to and (6) ‘‘Report Violations.’’ 5748), FMCSA–99–5473 (OMCS–99–5473), five agencies within DOT the authority to bring 4 The Secretary of Transportation has delegated to FMCSA–99–6156 (OMCS–99–6156), and civil penalty enforcement cases and assess civil the Associate Deputy Secretary and Director, Office FMCSA–99–6480] penalties for violations of Federal hazardous of Intermodalism, the authority under Federal material transportation law or the HMR: United hazardous material transportation law to act as the Qualification of Drivers; Exemption States Coast Guard (USCG), Transportation Security focal point for review of hazardous materials Administration (TSA), Federal Railroad policies, monitor departmental hazardous materials Applications; Vision Administration (FRA), RSPA, Federal Motor Carrier activities, and address regulatory and programmatic Safety Administration (FMCSA). 1.46(u), 1.47(j)(1), cross-modal issues related to hazardous materials as AGENCY: Federal Motor Carrier Safety 1.49(s)(1), 1.53(b)(1), 1.73(d)(1). warranted. 49 CFR 1.74. Administration (FMCSA), DOT. VerDate 11 ACTION: Notice of renewal of exemption; Robert W. Nicks, Richard W. O’Neill, received, and their contents were request for comments. Tommy L. Ray, Jr., Andrew W. carefully considered by the agency in Schollett, Melvin B. Shumaker, Sammy reaching its final decision to grant the SUMMARY: This notice announces D. Steinsultz, Edward J. Sullivan, and petitions (64 FR 66962). The agency FMCSA’s decision to renew the Steven L. Valley. Under 49 U.S.C. 31315 determined that exempting the exemptions from the vision requirement and 31136(e), FMCSA may renew an individuals from 49 CFR 391.41(b)(10) in 49 CFR 391.41(b)(10) for 19 exemption for a 2-year period if it finds was likely to achieve a level of safety individuals. ‘‘such exemption would likely achieve a equal to, or greater than, the level that DATES: This decision is effective April level of safety that is equivalent to, or would be achieved without the 14, 2002. Comments from interested greater than, the level that would be exemption as long as the vision in each persons should be submitted by May 9, achieved absent such exemption.’’ applicant’s better eye continued to meet 2002. Accordingly, FMCSA has evaluated the the standard specified in 49 CFR ADDRESSES: You can mail or deliver 19 petitions for renewal on their merits 391.41(b)(10). As a condition of the comments to the U.S. Department of and decided to extend each exemption exemption, therefore, the agency Transportation, Dockets Management for a renewable 2-year period. imposed requirements on the Facility, Room PL–401, 400 Seventh On April 14, 2000, the agency individuals similar to the grandfathering Street, SW., Washington, DC 20590– published a notice of final disposition provisions in 49 CFR 391.64(b) applied 0001. You can also submit comments as announcing its decision to exempt 34 to drivers who participated in the well as see the submissions of other individuals, including 10 of these agency’s former vision waiver program. These requirements are as follows: (1) commenters at http://dms.dot.gov. applicants for renewal, from the vision That each individual be physically Please include the docket numbers that requirement in 49 CFR 391.41(b)(10) (65 examined every year (a) by an appear in the heading of this document. FR 20251). The qualifications, ophthalmologist or optometrist who You can examine and copy this experience, and medical condition of attests that vision in the better eye meets document and all comments received at each applicant were stated and the standard in 49 CFR 391.41(b)(10), the same Internet address or at the discussed in detail at 64 FR 68195 and (b) by a medical examiner who Dockets Management Facility from 9 (December 6, 1999). Two comments attests the individual is otherwise a.m. to 5 p.m., e.t., Monday through were received, and their contents were physically qualified under 49 CFR Friday, except Federal holidays. If you carefully considered by the agency in 391.41; (2) that each individual provide want to know that we received your reaching its final decision to grant the a copy of the ophthalmologist’s or comments, please include a self- petitions (65 FR 20251). On January 3, optometrist’s report to the medical addressed, stamped postcard or include 2000, the agency published a notice of examiner at the time of the annual a copy of the acknowledgement page final disposition announcing its medical examination; and (3) that each that appears after you submit comments decision to exempt 40 individuals, individual provide a copy of the annual electronically. including 5 of these applicants for medical certification to the employer for FOR FURTHER INFORMATION CONTACT: For renewal, from the vision requirement in retention in the driver’s qualification information about the vision 49 CFR 391.41(b)(10) (65 FR 159). The file and retain a copy of the certification exemptions in this notice, Ms. Sandra qualifications, experience, and medical on his/her person while driving for Zywokarte, Office of Bus and Truck condition of each applicant were stated presentation to a duly authorized Standards and Operations, (202) 366– and discussed in detail at 64 FR 54948 Federal, State, or local enforcement 2987; for information about legal issues (October 8, 1999). Two comments were official. related to this notice, Mr. Joseph received, and their contents were Solomey, Office of the Chief Counsel, carefully considered by the agency in Basis for Renewing Exemptions (202) 366–1374, FMCSA, Department of reaching its final decision to grant the Under 49 U.S.C. 31315(b)(1), an Transportation, 400 Seventh Street, petitions (65 FR 159). On December 13, exemption may be granted for no longer SW., Washington, DC 20590. Office 1999, the agency published a notice of than 2 years from its approval date and hours are from 7:45 a.m. to 4:15 p.m., final disposition announcing its may be renewed upon application for e.t., Monday through Friday, except decision to exempt one of these additional 2-year periods. In accordance Federal holidays. applicants for renewal, from the vision with 49 U.S.C. 31315 and 31136(e), each SUPPLEMENTARY INFORMATION: requirement in 49 CFR 391.41(b)(10) (64 of the 19 applicants has satisfied the FR 69586). The qualifications, entry conditions for obtaining an Electronic Access and Filing experience, and medical condition of exemption from the vision requirements You may see all comments online the applicant were stated and discussed (65 FR 20251; 64 FR 68195; 65 FR 159; through the Document Management in detail at 64 FR 27025 (May 18, 1999). 64 FR 54948; 64 FR 69586; 64 FR 27025; System (DMS) at: http://dmses.dot.gov/ Two comments were received, and their 64 FR 66962; 64 FR 40404), and each submit. contents were carefully considered by has requested timely renewal of the the agency in reaching its final decision exemption. These 19 applicants have Background to grant the petition (64 FR 69586). On submitted evidence showing that the Nineteen individuals have requested November 30, 1999, the agency vision in their better eye continues to renewal of their exemptions from the published a notice of final disposition meet the standard specified at 49 CFR vision requirement in 49 CFR announcing its decision to exempt 33 391.41(b)(10), and that the vision 391.41(b)(10) which applies to drivers of individuals, including 3 of these impairment is stable. In addition, a commercial motor vehicles (CMVs) in applicants for renewal, from the vision review of their records of safety while interstate commerce. They are Mark K. requirement in 49 CFR 391.41(b)(10) (64 driving with their respective vision Cheely, James D. Davis, James F. FR 66962). The qualifications, deficiencies over the past 2 years Durham, Glenn E. Gee, Robert N. experience, and medical condition of indicates each applicant continues to Heaton, Laurent G. Jacques, Alfred G. each applicant were stated and meet the vision exemption standards. Jeffus, Michael W. Jones, Jon G. Lima, discussed in detail at 64 FR 40404 (July These factors provide an adequate basis Earl E. Martin, Clifford E. Masink, 26, 1999). Three comments were for predicting each driver’s ability to VerDate 11 continue to drive safely in interstate of the exemption; (2) the exemption has and to two contracts signed prior to the commerce. Therefore, FMCSA resulted in a lower level of safety than date of the letter, as noted below. This concludes that extending the exemption was maintained before it was granted; or notice shall insure that the public is for a period of 2 years is likely to (3) continuation of the exemption would aware of these waivers. achieve a level of safety equal to that not be consistent with the goals and FOR FURTHER INFORMATION CONTACT: existing without the exemption for each objectives of 49 U.S.C. 31315 and Meghan G. Ludtke, FTA Office of Chief renewal applicant. 31136(e). Counsel, Room 9316, (202) 366–1936 Discussion of Comments Request for Comments (telephone) or (202) 366–3809 (fax). SUPPLEMENTARY INFORMATION: The The Advocates for Highway and Auto FMCSA has evaluated the above-referenced waivers follow: Safety (AHAS) expresses continued qualifications and driving performance opposition to FMCSA’s procedures for of the 19 applicants here and extends March 19, 2002. renewing exemptions from the vision their exemptions based on the evidence Mr. Andy Racz, President and CEO, North requirement in 49 CFR 391.41(b)(10). introduced. The agency will review any American Bus Industries, Inc., H–1165 Specifically, AHAS objects to the comments received concerning a Budapest, XVI UJSZASZ u., 45 Hungary. Dear Mr. Racz: agency’s extension of the exemptions particular driver’s safety record and without any opportunity for public This responds to your letter dated determine if the continuation of the December 14, 2001, in which you request two comment prior to the decision to renew exemption is consistent with the Buy America waivers from the Federal and reliance on a summary statement of requirements at 49 U.S.C. 31315 and Transit Administration (FTA) for North evidence to make its decision to extend 31136(e). While comments of this nature American Bus Industries’ (NABI) CompoBus. the exemption of each driver. will be entertained at any time, FMCSA The CompoBus is a light-weight, composite- The issues raised by AHAS were requests that interested parties with structured vehicle with an integrated frame addressed at length in 66 FR 17994 information concerning the safety and chassis developed in line with FTA’s (April 4, 2001). We will not address records of these drivers submit Advanced Technology Bus program. You these points again here, but refer request (1) a public interest waiver of the comments by May 9, 2002. All final assembly requirements for a period of interested parties to that earlier comments will be considered and will discussion. seven years and (2) a component waiver for be available for examination in the the integrated body/chassis of the CompoBus, Conclusion docket room at the above address. based on public interest or non-availability. FMCSA will also continue to file in the For the reasons discussed below, we have In accordance with 49 U.S.C. 31315 docket relevant information which determined that the grounds for such waivers and 31136(e), FMCSA extends the becomes available. Interested persons exist for a two-year period. exemptions from the vision requirement in 49 CFR 391.41(b)(10) granted to Mark should continue to examine the docket Applicable Law K. Cheely, James D. Davis, James F. for new material. FTA’s requirements concerning domestic Durham, Glenn E. Gee, Robert N. Issued on: April 4, 2002. preference for federally funded transit Heaton, Laurent G. Jacques, Alfred G. Brian M. McLaughlin, projects are set forth in 49 U.S.C. 5323(j). Section 5323(j)(2)(C) addresses the general Jeffus, Michael W. Jones, Jon G. Lima, Associate Administrator for Policy and requirements for the procurement of rolling Earl E. Martin, Clifford E. Masink, Program Development. stock. This section provides that all rolling Robert W. Nicks, Richard W. O’Neill, [FR Doc. 02–8553 Filed 4–8–02; 8:45 am] stock procured with FTA funds must have a Tommy L. Ray, Jr., Andrew W. BILLING CODE 4910–EX–P domestic content of at least 60 percent and Schollett, Melvin B. Shumaker, Sammy must undergo final assembly in the U.S. D. Steinsultz, Edward J. Sullivan, and Under 49 U.S.C. 5323(j)(2)(A) and the Steven L. Valley, subject to the DEPARTMENT OF TRANSPORTATION implementing regulations, these following conditions: (1) That each requirements may be waived if their individual be physically examined Federal Transit Administration application ‘‘would be inconsistent with the every year (a) by an ophthalmologist or public interest.’’ 49 C.F.R. 661.7(b). The optometrist who attests that the vision North American Bus Industries; Notice regulation also notes that ‘‘[i]n determining of Granted Buy America Waivers whether the conditions exist to grant this in the better eye continues to meet the public interest waiver, the [FTA] will standard in 49 CFR 391.41(b)(10), and AGENCY: Federal Transit Administration consider all appropriate factors on a case-by- (b) by a medical examiner who attests (FTA), DOT. case basis ....’’ Id. And 49 U.S.C. that the individual is otherwise ACTION: Notice of granted Buy America 5323(j)(2)(B) states that the Buy America physically qualified under 49 CFR waivers. requirements shall not apply if the item or 391.41; (2) that each individual provide items being procured are not produced in the a copy of the ophthalmologist’s or SUMMARY: FTA granted North American U.S. in sufficient and reasonably available optometrist’s report to the medical Bus Industries (NABI) two Buy America quantities or are not of a satisfactory quality. examiner at the time of the annual waivers on March 19, 2002. The first The implementing regulation also provides that public interest and non-availability medical examination; and (3) that each waiver allows NABI to assemble its waivers may be granted for a component of individual provide a copy of the annual CompoBus outside the United States rolling stock, and in such cases, the medical certification to the employer for and the second allows it to count the component would be treated as domestic retention in the driver’s qualification composite chassis/frame as domestic for when calculating the overall component file and retain a copy of the certification purposes of calculating the domestic content of the vehicle. 49 C.F.R. 661.7(f) on his/her person while driving for component content of the vehicle. The Final Assembly Waiver Request presentation to a duly authorized final assembly waiver is predicated on Federal, State, or local enforcement public interest and the component Your request for a final assembly waiver is for CompoBus models 40C–LFW and 45C– official. Each exemption will be valid waiver on the non-availability of the LFW. You detail a number of advantages for 2 years unless rescinded earlier by item domestically. Both of these waivers offered by the CompoBus, including its FMCSA. The exemption will be will apply to procurements for which lightweight frame/chassis, the fact that it has rescinded if: (1) The person fails to solicitations are issued within two years completed Altoona testing, the lack of comply with the terms and conditions of the date of the letter, March 19, 2002, rusting, the environmental advantages, and VerDate 11 its crash worthiness. NABI has two primary Transportation Authority (LACMTA) for 30 Seventh Street, SW., Washington, DC manufacturing facilities, one in Hungary, the CompoBuses.1 Another LACMTA 20590. Telephone 202–493–0212. other in Anniston, Alabama. procurement is affected by this waiver, a SUPPLEMENTARY INFORMATION: FTA has determined that in this case, a contract for 370 buses, the last 20 of which Mr. James final assembly waiver for a two-year period will be composite buses.2 Because that award J. Johnston, President of the Owner- is in the public interest. FTA acknowledges would have had a different result if NABI Operator Independent Drivers the technical difficulties and increased costs had certified non-compliance and requested Association, Inc. (OOIDA), submitted a associated with new technology and the a waiver prior to award, it is FTA’s position petition to NHTSA by letter dated consequent benefits of a single that NABI is bound by its original March 21, 2001, requesting that an manufacturing facility. FTA supports the certification of compliance and, therefore, investigation be initiated to determine continued development of new vehicle must assemble those vehicles in the U.S. If you have any questions, please contact whether to issue an order concerning technology that will result in more choices safety defects in model year 1989 for FTA grantees and better buses for the Meghan G. Ludtke at 202–366–1936. riding public. This waiver will accomplish Very truly yours, through 2000 Volvo heavy trucks that goal. These advances are important Gregory B. McBride, (subject trucks). The petition is enough to allow NABI time to further Deputy Chief Counsel. extremely broad in that the petitioner develop the technology. FTA declines to alleges multiple defects on more than 30 Issued on: April 4, 2002. provide a seven-year waiver because we want models of Volvo trucks produced over a to encourage continued changes in the Jennifer L. Dorn, span of 12 model years. marketplace and must be in a position to FTA Administrator. The petition identified alleged review this decision in two years and [FR Doc. 02–8551 Filed 4–8–02; 8:45 am] deficiencies in nine areas. Those areas consider any such changes. However, FTA is BILLING CODE 4910–57–M were identified as: (1) Shaking and also aware of the time lapses between entering into a contract and building a bus; vibration in the front end; (2) steering problems; (3) premature front tire wear; therefore, this waiver applies to CompoBus DEPARTMENT OF TRANSPORTATION models 40C–LFW and 45C–LFW for all (4) wheel alignment problems; (5) problems with axle parts, including an procurements for which solicitations are National Highway Traffic Safety issued within two years of the date of this overweight condition on the steering Administration letter. axle; (6) suspension problems; (7) Component Wavier Request Partial Grant and Partial Denial of transmission and clutch problems; (8) problems with the engine, including You also request a non-availability waiver Motor Vehicle Defect Petition, DP01– for the CompoBus’ integrated frame/chassis 003 unintended ‘‘racing’’ or ‘‘shutting structures for use in model numbers 40C– down,’’ and (9) electrical problems. AGENCY: LFW and 45C–LFW. Based on the National Highway Traffic The OOIDA petition and subsequent information you have provided, I have Safety Administration (NHTSA), information forwarded to the NHTSA determined that the grounds for a non- Department of Transportation. Office of Defects Investigation (ODI) availability waiver exist, as it does not appear ACTION: Partial grant and partial denial contained complaints from 180 persons. that there is another source for this product. of petition for a defect investigation. A review of the ODI database for Therefore, pursuant to the provisions of 49 additional complaints pertaining to the SUMMARY: This notice sets forth the U.S.C. § 5323(j)(2)(B), a non-availability alleged defects on the subject trucks waiver is granted for the CompoBus models reasons for the partial grant and partial revealed an additional 41 complainants. 40C–LFW and 45C–LFW integrated frame/ denial of a petition submitted to NHTSA Many of the complainants cited chassis structure for all procurements for under 49 U.S.C. 30162, requesting that multiple problems with one or more which solicitations are issued within two the agency commence a proceeding to subject trucks. To assist with evaluation years of the date of this letter. determine the existence of a defect of the petition, ODI staff communicated Conclusion related to motor vehicle safety. The directly with approximately 74 persons, NABI has offered sufficient justification for petition is hereinafter identified as DP01–003. including representatives of 13 fleet a public interest waiver for the final assembly operations. of the CompoBus for a period of two years. FOR FURTHER INFORMATION CONTACT: Mr. The grounds necessary for a non-availability Review of the OOIDA and ODI data Robert Squire, Office of Defects revealed that approximately 92% of the component waiver also exist for the Investigation (ODI), NHTSA, 400 integrated frame/chassis structure, and FTA complaints involved model year 1995 hereby grants such a waiver for a period of and newer subject trucks. Eighteen 1 The contract with the City of Phoenix was two years. To ensure that the public is aware awarded to NABI, the only bidder, which certified complaints involved model year 1994 of these waivers, this letter will be published compliance with Buy America. Had NABI certified subject trucks, while 11 complaints in the Federal Register. non-compliance, it would have been eligible for involved model year 1993 and older The public interest waiver is predicated on award as the only bidder, and Phoenix would have subject trucks. Unfortunately, many qualified for a non-availability waiver under 49 the fact that it is in the public’s interest to complaints failed to identify the vehicle waive the Buy America final assembly C.F.R. 661.7(c)(1). The contract with LACMTA for requirements in this case; however, FTA is 30 CompoBuses was awarded after a negotiated model, model year and/or vehicle not of the opinion that that public interest procurement with two responsive and responsible identification number. Although this proposers in competitive range. Both proposers lack of information hampered the overrides the government’s interest in full certified compliance with Buy America; however, and open competition. It is for this reason the other bid was more than twenty-five percent analysis, data from these complaints that FTA has reviewed the three over NABI’s bid. Thus, had NABI certified non- were nonetheless reviewed to the fullest procurements that resulted in an award to compliance, it would have been eligible for award extent possible. NABI for the CompoBus. FTA has reviewed because there was more than a twenty-five percent After conducting an extensive review price difference between the two offers, and the underlying competition for each contract of the issues raised in the petition, and found that in two cases, the waiver will LACMTA would have qualified for a waiver under 49 C.F.R. 661.7(c)(1). NHTSA has granted it with respect to have no impact on the full and open 2 competition required in federally funded This was a sealed bid with two responsive and the following issues: responsible bidders, both of which certified 1. Alleged steering defects on model procurements. Therefore, this waiver will compliance. There was not more than a twenty-five apply to those contracts between NABI and percent difference in the bids; therefore, had NABI year 1998 through 2000 VN–610, 660, the City of Phoenix and between NABI and certified non-compliance, it would not have and 770 series trucks regarding ‘‘lock the Los Angeles County Metropolitan qualified for the award. up,’’ ‘‘binding,’’ or ‘‘pulling’’ of the VerDate 11 steering system. An investigation has Issued on: April 1, 2002. individual contacts increased the been opened (PE01–041). Kenneth N. Weinstein, original number of complainants by 64 2. Alleged front axle component Associate Administrator for Safety for a total of 285.2 Some complainants failure regarding steer axle U-bolts on Assurance. owned more than one truck (not model year 1998 through 2000 VN–610, counted as a fleet). DP01–003 Addendum 660, and 770 series trucks. An The petition claimed that the investigation has been opened (PE01– In March 2001, the Owner-Operator problems spanned twelve model years, 042). An alleged defect with respect to Independent Drivers Association, Inc., 1989 through 2000. Review of the the drive or rear axle U-bolts was (OOIDA) petitioned the National complaints, however, revealed that most previously under way (EA01–011). Highway Traffic Safety Administration involved recent model year (MY) trucks, The allegations regarding the scope of (NHTSA) to investigate numerous MY 1994 and newer. Vehicle model and Volvo’s recall to address front axle alleged defects on all Volvo truck model year could not be identified for overweight conditions on model year tractors manufactured between the years approximately 4% of the complaints. 1998 through 2001 VN-series trucks is of 1989 and 2000. The complaints The table below illustrates the percent being addressed through a Recall Audit provided in the OOIDA petition and of complaints within various vehicle (AQ02–018). those extracted from the NHTSA model year ranges. It is unlikely that NHTSA would issue database were often vague and provided an order for the notification and remedy few details to assist with conclusively of the other alleged defects as defined identifying an allegedly defective by the petitioner for the subject vehicles component. The petition itself was at the conclusion of the investigation extremely broad and appeared to cover requested in the petition. Therefore, in almost every system on the subject view of the need to allocate and trucks. prioritize NHTSA’s limited resources to Evaluation of the petition involved best accomplish the agency’s safety the review of information provided by mission, the petition is denied with approximately 180 complaints respect to the remaining allegations. submitted by OOIDA on behalf of Volvo However, information obtained by the truck owners. Complaints from an agency during its evaluation of the additional 41 (non duplicate) petition has led it to open an complainants contained within the investigation with respect to alleged NHTSA database were likewise The OOIDA petition divided the electrical problems potentially leading reviewed. Since July 1, 2001, no complaints into nine general categories: to fires in the sleeper berth of model additional complaints have been Vibration (front-end); Steering; year 1998 through 2000 VN–610, 660, received through OOIDA; however, Premature front tire wear; Wheel and 770 series trucks. An investigation individual owners have contacted the alignment; Axle (components and gross has been opened (PE01–040). Office of Defects Investigation (ODI) axle weight); Suspension; Transmission A description of NHTSA’s analysis of directly. ODI staff interviewed a total of (clutch); Engine; and Electrical. The the issues raised by the petition and the 74 individuals, including 13 fleet 1 table below illustrates the source of each reasons for its decisions are set forth in representatives, by telephone. These complaint alleged within each area. an Addendum to this notice. Authority: 49 U.S.C. 30162(d); delegations 1 Fleet sizes ranged from 5 to 500 vehicles. See 2 Not all owners interviewed had complaints nor of authority at CFR 1.50 and 501.8. contact sheet in DP01–003. were they dissatisfied with their vehicle. VerDate 11 Additional information regarding vibration was referred to in the OOIDA complaints involved tractors with each complaint area is provided below. petition, interviews revealed that integral sleeper berth units. A breakdown by vehicle model and vibration complaints also included the A complaint of front-end vibration model year is also provided for each driveline and rear axles. Interviews with frequently accompanied a report of individual owners illustrated that this complaint area. excessive front axle weight and/or Complaint 1—Shaking and vibration complaint was subjective in nature and premature front axle tire wear. There through the front of the truck (36 often was dependant upon the driver’s complaints). Although this was a expectations. Fleet operators tended to was no indication that this condition recurring complaint, analysis of the have fewer complaints than owner/ rendered the vehicle uncontrollable or written complaints and telephone operators and specifically noted that created a significant risk to safety. No interviews failed to establish a specific they tended to adhere to regular further action on this issue will be causal factor. Although ‘‘front end’’ maintenance schedules. The majority of taken. VerDate 11 Complaint 2—Steering deficiencies information was lacking in many of the addition to the VN-models, two (24 complaints). Some recurring complaints. Analysis of the complaints complaints regarding the WIA model problems with the steering system on revealed a total of 24 complaints with were received, one from a MY 1996 model year 1998 and newer trucks were sufficient information to indicate a vehicle and one from a MY 1997 alleged. The OOIDA petition alleged potential problem related to the steering vehicle. The complaints noted one of that Volvo trucks were prone to steering system (this total excludes one fleet that several symptoms, including: steering problems and cited 45 complaints reported problems with multiple wheel or shaft binding, steering lock-up, 3 related to ‘‘steering.’’ In addition, vehicles). In all but two cases, the steering ‘‘pull,’’ and steering gear box ‘‘excessive sway’’ and ‘‘road wander’’ problems involved VN-model trucks. A leak or failure. The table below provides were terms used to describe a steering majority of the complaints involved the a summary of these complaints. deficiency. Unfortunately, detailed 770 model, Volvo’s heaviest tractor. In The evaluation of steering complaints all the complainants were owner- OOIDA petition failed to identify a also led to contact with an engineering operators, with one fleet operator representative number of vehicles that firm that reportedly has investigated reporting tire wear problems with the had undergone repairs per recall 01V– approximately 11–12 collisions steering axle tires. Most complainants 093 to assess whether the remedy involving VN-series trucks where a generally reported 50,000 to 80,000 improved tire wear. The issue of the steering defect is suspected. In addition miles of operation before tire scope of that recall is being considered to speaking with a representative of the replacement was necessary. Many in a Recall Audit (AQ02–018). Tire wear engineering firm, 18 of the ‘‘steering complainants reported unusual was cited not as a safety issue, but one problem’’ complainants were contacted. ‘‘cupping,’’ scalloping,’’ or edge wear. In of economics. Owners reported that tire An investigation of this issue has been a majority of cases owners blamed purchases tended to be one of the most opened. heavy front-end weight for the wear. In costly recurring expenses they faced. Complaint 3—Premature tire wear March 2001, Volvo initiated a recall In view of the apparent lack of a (118 complaints). This complaint was (NHTSA #01V–093) to address the front safety issue, no further action on this the predominant recurring issue. Nearly axle weight problem. Evaluation of the issue will be taken. 3 specific vehicle information at the time of the The fleet representative stated that this occurred conversation. on ‘‘several’’ vehicles, but was unable to provide VerDate 11 Complaint 4—Wheel alignment found to be loose or fractured at the alignment. Although complainants problems (52 complaints). Although time the wheel alignment was frequently equated poor alignment with there were a few complaints that wheel performed. In the interviews conducted tire wear and ‘‘lane drift’’ or ‘‘road alignment could not be maintained, few by ODI staff, only four (4) complainants wander,’’ the issue of ‘‘alignment’’ did specifics were provided to indicate a reported having difficulty keeping the not appear to raise safety concerns. probable cause. Alignment complaints vehicle ‘‘in alignment.’’ A substantial Complainants reported having full typically coincided with tire wear and number of complainants reported control of their vehicles, and no crashes front axle weight distribution having repeated alignment procedures or injuries were reportedly related to complaints. In some situations where completed in an attempt to correct this issue. No further action on this owners reported alignment problems, problems with steer axle tire wear or issue will be taken. they also reported problems with axle vibration. These complainants reported U-bolts. In many cases the U-bolts were no problem with the vehicle retaining VerDate 11 Complaint 5—Axle problems (238 the U-bolts, with eventual fracturing. alleging defective steer axle wheel complaints, total). This complaint area Statements provided by some bearings. The complaints involved was divided into two parts. One area complainants suggested that loosening model year 1998 through 2000 VN 610, focused solely on (A) axle components of the U-bolt is a precursor to failure. 660, and 770 models with only one and the other on (B) steer axle weight. Some complainants reported hearing a complaint outside this range, a model The OOIDA petition alleged that Volvo ‘‘popping’’ or ‘‘clunking’’ noise, year 1994 WIA. trucks were prone to failure of axle particularly during turning maneuvers. Complainants alleging wheel bearing components, thereby increasing the risk Subsequent inspection frequently failure described one of several of a crash and compromising safety. revealed loose steer axle U-bolts. The symptoms. Symptoms included loose Analysis of the complaints indicated Volvo owner’s manual guide to service wheel bearings at the time of vehicle that the only axle parts subject to recommends checking the torque of the delivery, accelerated wear, and/or alleged failures were the axle U-bolts U-bolts at 15,000-mile intervals. Nearly complete failure leading to the loss of a and steer axle wheel bearings. all complainants reported never (A1) Axle Component: U-Bolt (22 experiencing loose U-bolt conditions wheel. Of the 106 complaints, 103 complaints). A review of the OOIDA with other vehicle makes. originated with a single fleet, so there petition and NHTSA database at the U-bolt failure can lead to a were only four different complainants. time the petition was submitted displacement of the axle and increase Even though many of the revealed a total of 10 complaints the potential for a crash. At least one complainants contacted during the alleging defective axle U-bolts, incident of steer axle U-bolt failure petition evaluation did not complain of primarily on model year 1995 through allegedly led to a crash. James Gardiner steer axle wheel bearing failure, they 2000 Volvo trucks. Specific models reported that while operating at did report recurrent front-end work to mentioned included the WIA and VN- highway speed, his truck unexpectedly correct tire wear problems. Most series trucks. During the petition veered to the right, departed the reported repeated procedures involving evaluation, twelve (12) additional highway, and overturned. A post- removal of the wheel and/or retorquing complainants alleging defective axle U- collision inspection revealed a fractured of the wheel bearings. bolts were identified and interviewed. right steer axle U-bolt. Gardiner believes Consultation with local Volvo service These complaints all involved the VN- that the fracturing of the U-bolt resulted managers and technicians failed to series truck. in a rearward displacement of the steer reveal any additional information or During the petition evaluation, it was axle on the right side. He believes this acknowledgement of problems. In a observed that the occurrence rate for caused the vehicle to depart the worst-case scenario, the failure of a steer failure or problem with the front axle U- highway. bolts exceeded that of the drive axle. Available information indicates that axle wheel bearing can result in wheel Drive axle U-bolt failure is currently the nearly all U-bolt complaints and failures separation and the potential for a crash. subject of an Engineering Analysis, involve MY 1998 through 2000 VN However, no crashes, injuries, or EA01–011. The scope of this series trucks. An investigation of this fatalities have been reported involving investigation involves the drive axle U- issue with respect to those vehicles has bearing failure on these Volvo trucks. bolt assemblies on model year 1996 been opened. Volvo trucks exhibited no previous through 2000 Volvo trucks. (A2) Steering Axle Wheel Bearings recalls or investigations related to this Several complainants alleging (106 complaints). A review of the issue. defective U-bolts were interviewed OOIDA petition and NHTSA database at The available information does not during the petition evaluation. Most the time the petition was submitted warrant opening an investigation of this complained of a recurrent loosening of revealed a total of 106 complaints issue at this time. VerDate 11 (B) Steering Axle Weight (110 define an ideal weight condition based challenges the effectiveness and scope complaints). The OOIDA petition upon past experience or the restrictions of recall 01V–093 and alleges other alleged that Volvo trucks were prone to of individual states. Many owner/ problems with regard to establishing the an overweight condition on the steer drivers reported the desire to keep the weight distribution on VN model trucks. axle. Evaluation of the complaints front axle weight below 12,000 pounds Since filing his petition with NHTSA, revealed that with few exceptions, this and defined an overweight condition as Mr. Barber has provided information on complaint typically involved the newer any weight in excess of this number. approximately 100 trucks (including VN series trucks. An overwhelming Regarding state highway restrictions, having owners contact NHTSA directly). majority of the complaints involved the five states4 reportedly restrict the gross It was through these contacts that the 770 model, Volvo’s largest tractor with front axle weight to 12,000 pounds. overweight issue was more precisely an integral sleeper. Complaint review, Federal regulations require the defined. All of the ‘‘confirmed’’ personal interviews and field studies manufacturer to install a label overweight cases involved VN 610, 660, have revealed, however, that model specifying the GAWR. The GAWR and 770 model trucks. Overweight series 610 and 660 vehicles are also should not exceed the weight rating of complaints existed across all three often operated in an overweight the weakest individual axle component, model lines; however, the 770 models condition. including the tires. According to Volvo, exhibited the greatest number of A total of 110 complaints alleging an the GAWR is based on the component complaints. overweight condition on the front axle with the lowest load capacity inclusive Volvo states that the front axle weight were reviewed. The OOIDA petition had of the tires, wheels, suspension, brakes, should be measured with the vehicle listed 66 individual complaints of a and other axle components. In most fully fueled and in a bobtail (no trailer) steer axle overweight condition. cases the GAWR is equal to the tire load configuration. Allowances are also made Unfortunately, many of the OOIDA capacity. Through a review of the for the driver and personal cargo. Some complaints contained few specifics complaints and conversations with of the ‘‘overweight’’ vehicles were regarding the interpretation of owners, front axle gross weight ratings weighed with trailers and/or auxiliary specified on the Federal label exhibited ‘‘overweight.’’ ODI contacted 47 equipment installed on the tractor. a range between 11,620 and 12,350 complainants who specifically noted Nearly all complainants reported that pounds. that the actual axle weight exceeded the when the tractor is coupled to a trailer In April 2001, Nick Barber petitioned under any load, the 5th wheel must be front axle weight rating (GAWR—gross NHTSA concerning the adequacy of axle weight rating). These complainants at the full aft position to maintain a Volvo’s actions with respect to Recall front axle weight less than the GAWR. reported that the actual axle weight 01V–093 5 (DP01–006). This petition ranged from 12,400 to 13,500 pounds. Some drivers complained, however, that the ‘‘full aft’’ 5th wheel position creates For most vehicles the front GAWR was 4 According to the 2001 edition of Transport 12,350 pounds. A total of 17 Topics Size & Weight Update (American Trucking additional problems. They cite the large complainants provided copies of scale Associations), the following states restrict the gross gap between the tractor and trailer as tickets exhibiting an overweight front axle weight to 12,000 pounds—Alabama, being responsible for decreased fuel Arizona, Arkansas, California, and Kentucky. Some efficiency. The use of only one position condition. states impose additional restrictions limiting tire Review of the complaint documents gross weight to the product of a specified number on a moveable 5th wheel also negates and personal interviews with owners of pounds per inch of tread width. 5 revealed differing interpretations for In March 2001, Volvo initiated recall RVXX0103 contains the front GAWR information . . . does not (NHTSA 01V–093), applicable to 1,577 VN model accurately reflect the actual front gross axle defining an overweight condition on the trucks, stating that ‘‘under certain operating weight.’’ The recall involves trucks manufactured steer axle. Many owners tended to conditions, the weight certification label which between 11/22/97 and 08/28/99. VerDate 11 the advantage of moving the coupler to discourages and accepts no report that they informed the dealer of further distribute axle loads. Volvo responsibility if such additions are the additions at the time of purchase. contends that the addition of auxiliary made. Owners, however, have stated NHTSA granted DP01–006 after equipment (tools boxes, cab protection that some installation of the auxiliary evaluating the issues raised in that devices, generators, etc.) could increase equipment is performed or facilitated by petition and has opened a Recall Audit the front axle weight and therefore the dealer. In other instances, owners (AQ02–018). Complaint 6—Suspension problems alignment, and premature steer axle tire suspension problems were identified. (12 complaints). This issue involves wear as being suspension related. The number of complaints citing many of the same issues raised in the Regarding this issue, no failed suspension problems is tallied in the axle component complaints. Most components, other than axle U-bolts, table below. No further action on this complaints also cited vibration, were identified. As such, no specific issue will be taken. Complaint 7—Transmission and warranty. Two owners complained of complaints indicated that the situation clutch problems (20 complaints). There difficulty with shifting and another presented a recurring safety hazard. were a few complaints of transmission reported that the transmission shifted There were no reports of collisions or failure; however, all but one of the into the wrong gear. Two owners injuries related to this issue. owners interviewed reported that the complained of the transmission Regarding clutch complaints, most transmission was replaced under overheating. None of the transmission complainants reported premature wear VerDate 11 requiring expensive replacement. Other required repeated adjustment. None of to safety existed. No further action on complaints noted that the clutch the complaints indicated that a hazard this issue will be taken. Complaint 8—Engine defects (5 unexpected ‘‘acceleration’’ and ‘‘shut starting or rough idle. No trend complaints). Very few complaints down’’ (stalling) as issues of contention. regarding engine problems was alleged engine problems and none One complaint noted the occurrence of observed. No further action on this issue exhibited any trend that could be engine ‘‘rev up’’ while at idle while will be taken. considered a hazard to safety. The most of the engine problems cited poor OOIDA petition specifically noted wiring connections leading to difficult Complaint 9—Electrical defects (65 vehicles is subject to failure. They simultaneous failure of all instrument complaints). A substantial number of report that a quality control problem lighting. They complained that lamp complaints noted ‘‘electrical problems.’’ with the vendor necessitated a change replacement was needed every other Of the OOIDA petition complaints that in the unit’s design and construction month or so. Some complainants also contained specific information, most (new vendor). Volvo identifies this unit noted that the lamps exhibited poor or defined electrical problems with the as an accessory item and notes that all loose connections. ‘‘instrumentation’’ or ‘‘dash.’’ These crucial gauges are duplicated in analog Analysis of electrical problems issues were analyzed in greater detail form elsewhere on the dash. This revealed allegations of six (6) fires through vehicle owner and truck service complaint was common among both involving model year 1998 through 2001 center interviews. Nearly all instrument individual and fleet owners and VN series tractors with four (4) fires, problems appeared to be related to the comprised about 38% of the complaints potentially electrical in origin (one ‘‘SmartDash’’ or vehicle management expressed through telephone interviews. involving just smoke), originating in the display and instrument panel lighting. Instrument panel lighting was another sleeper compartment. The SmartDash component at issue is recurring electrical-related complaint. The four (4) sleeper berth fires a small LCD screen located on the Regarding this complaint, many owners, involved VN 610 and 660 models. In instrument panel that displays a range including at least three fleets, reported each case fire investigators identified of information to the driver. The unit recurrent problems with instrument the fire’s origin in the proximity of provides information such as miles per panel lighting prematurely ‘‘burning electrical wiring, with three cases gallon, trip time, axle and coolant out’’ or experiencing poor electrical originating near the sleeper ventilation temperature, diagnostic fault codes, and connections. This problem was cited in control panel. Unfortunately, the exact other information. Volvo representatives approximately 11% of the complaints cause of the fire was not determined have acknowledged that the display expressed through telephone interviews. although electrical short-circuiting was screen on model year 1998 through 2000 None of the complainants reported indicated as a possible source. The VerDate 11 sleeper berth of the VN-series truck is The two remaining fire complaints regarding fire and electrical problems in equipped with an individual heating involved a 2001 VN–610 and a 1998 the sleeper berth appear to contain and air conditioning blower located VN–770. Investigation of the VN–610 similar elements that warrant additional below the lower bunk and just right of fire failed to reveal the exact origin of analysis. the center of the vehicle. A controller the fire although the investigator Other than the sleeper berth fires, no unit used to adjust HVAC temperature believed it began in the vehicle’s engine trends were observed indicating a and blower fan speed is located on the compartment. The VN–770 fire left side wall of the berth about midway reportedly began in the dash wiring due potential safety defect trend. An between the ceiling and floor. At least to a faulty ‘‘dimmer switch.’’ Limited investigation into the sleeper berth fires three (3) fires reportedly originated in information was available regarding has been opened. the area of this control panel. these two incidents. Complaints ODI has compared the number of the complaint areas noted in the OOIDA manufacturers’ vehicles. Prior to the complaints regarding Volvo trucks with petition. The table below compares the OOIDA petition, the total number of the number of complaints about similar total number of Volvo truck complaints Volvo truck complaints recorded in the problems on other makes of other heavy (all sources) against the complaints in database was approximately 190. trucks. The comparison was limited to the ODI database for other VerDate 11 Analysis of the information made DEPARTMENT OF TRANSPORTATION manufacturer as complying with the available through and as a result of the safety standards, and (2) they are petition supports a conclusion that this National Highway Traffic Safety capable of being readily altered to petition should be partially granted and Administration conform to the standards. partially denied. The petition is granted [Docket No. NHTSA–2002–11878] DATES: The closing date for comments with respect to three areas of concern— on the petition is May 9, 2002. (1) steering problems, (2) front axle U- Notice of Receipt of Petitions for ADDRESSES: Comments should refer to bolt problems and (3) sleeper berth fires. Decision that Nonconforming 2001 and the docket number and notice number, Additionally, the issue of steering axle 2002 Porsche GT2 Turbo Passenger and be submitted to: Docket overweight condition is being addressed Cars are Eligible for Importation Management, Room PL–401, 400 Seventh St., SW, Washington, DC through Recall Audit AQ02–018 while AGENCY: National Highway Traffic 20590. [Docket hours are from 9 am to an issue pertaining to drive axle U-bolts Safety Administration, DOT. 5 pm]. is being investigated in an Engineering ACTION: Notice of receipt of petitions for FOR FURTHER INFORMATION CONTACT: Analysis, EA01–011. No further action decision that nonconforming 2001 and George Entwistle, Office of Vehicle will be taken with respect to the 2002 Porsche GT2 Turbo passenger cars Safety Compliance, NHTSA (202–366– remaining issues raised by the petition. are eligible for importation. 5306). [FR Doc. 02–8520 Filed 4–8–02; 8:45 am] SUMMARY: This document announces SUPPLEMENTARY INFORMATION: BILLING CODE 4910–59–P receipt by the National Highway Traffic Safety Administration (NHTSA) of two Background separate petitions for a decision that Under 49 U.S.C. 30141(a)(1)(A), a 2001 and 2002 Porsche GT2 Turbo motor vehicle that was not originally passenger cars that were not originally manufactured to conform to all manufactured to comply with all applicable Federal motor vehicle safety applicable Federal motor vehicle safety standards shall be refused admission standards are eligible for importation into the United States unless NHTSA into the United States because (1) they has decided that the motor vehicle is are substantially similar to vehicles that substantially similar to a motor vehicle were originally manufactured for originally manufactured for importation importation into and sale in the United into and sale in the United States, States and that were certified by their certified under 49 U.S.C. 30115, and of VerDate 11 the same model year as the model of the same manner as their U.S. certified and that release by means of a single red motor vehicle to be compared, and is counterparts, or are capable of being pushbutton. J.K. further states that the capable of being readily altered to readily altered to conform to those vehicles are equipped with a seat belt conform to all applicable Federal motor standards. warning lamp that is identical to the vehicle safety standards. Specifically, the petitioners claim that component installed on U.S.-certified Petitions for eligibility decisions may non-U.S. certified 2001 and 2002 models. be submitted by either manufacturers or Porsche GT2 Turbo passenger cars are Standard No. 301 Fuel System importers who have registered with identical to their U.S. certified Integrity: modifications for which J.K. NHTSA pursuant to 49 CFR part 592. As counterparts with respect to compliance has requested confidentiality. specified in 49 CFR 593.7, NHTSA with Standard Nos. 102 Transmission Additionally, J.K. states that the publishes notice in the Federal Register Shift Lever Sequence . . . ., 103 bumpers and support structures on non- of each petition that it receives, and Defrosting and Defogging Systems, 104 U.S. certified 2001 and 2002 Porsche affords interested persons an Windshield Wiping and Washing GT2 Turbo passenger cars are identical, opportunity to comment on the petition. Systems, 105 Hydraulic Brake Systems, in most cases, to those components At the close of the comment period, 106 Brake Hoses, 109 New Pneumatic found on the vehicles’ U.S. certified NHTSA decides, on the basis of the Tires, 113 Hood Latch Systems, 116 counterparts. J.K. stated, however, that petition and any comments that it has Brake Fluid, 124 Accelerator Control all vehicles must be inspected for part received, whether the vehicle is eligible Systems, 135 Passenger Car Brake number compliance. for importation. The agency then Systems, 201 Occupant Protection in Both petitioners contend that the publishes this decision in the Federal Interior Impact, 202 Head Restraints, vehicles are capable of being readily Register. 204 Steering Control Rearward altered to meet the following standards, Northern California Diagnostic Displacement, 205 Glazing Materials, in the manner indicated: Laboratories, Inc. of Napa, California 206 Door Locks and Door Retention Standard No. 101 Controls and (‘‘NCDL’’) (Registered Importer 92–011) Components, 207 Seating Systems, 209 Displays: replacement of the instrument petitioned NHTSA to decide whether Seat Belt Assemblies, 210 Seat Belt cluster with U.S.-model components. 2002 Porsche GT2 Turbo passenger cars Assembly Anchorages, 212 Windshield Standard No. 108 Lamps, Reflective are eligible for importation into the Retention, 214 Side Impact Protection, Devices and Associated Equipment: (a) United States. Shortly after NCDL’s 216 Roof Crush Resistance, 219 installation of U.S.-model headlamps petition was filed, J.K. Technologies, Windshield Zone Intrusion, and 302 and front sidemarker lamps, (b) L.L.C. of Baltimore, Maryland (‘‘J.K.’’) Flammability of Interior Materials. installation of U.S.-model taillamp (Registered Importer 90–006) separately Additionally, NCDL claims that non- assemblies that incorporate rear petitioned NHTSA to decide whether U.S. certified 2002 Porsche GT2 Turbo sidemarker lamps, (c) installation of 2001 and 2002 Porsche GT2 Turbo passenger cars are identical to their center high-mounted stop lamp if not passenger cars are eligible for U.S.-certified counterparts with respect already equipped. importation. J.K. requested the agency to to compliance with Standard Nos. 110 Standard No. 118 Power-Operated, grant confidentiality to certain Tire Selection and Rims, 111 Rearview Partition, and Roof Panel Systems: information that accompanied its Mirrors, 114 Theft Protection, 208 modification of the system to comply petition. NCDL did not file a Occupant Crash Protection, and 301 with the standard. confidentiality request. Because the two Fuel System Integrity and with the NCDL claims that non-U.S. certified petitions pertain to the same vehicles Bumper Standard found in 49 CFR part 2002 Porsche GT2 Turbo passenger cars (with the exception that the J.K. petition 581. comply with the parts marking covers two model years and the NCDL J.K. states that non-U.S certified 2001 requirements of the Theft Prevention petition only one), NHTSA is soliciting and 2002 Porsche GT2 Turbo passenger Standard at 49 CFR Part 541. J.K. states comments on both petitions in this cars are capable of being readily altered that this standard is inapplicable to the notice. to meet those standards, in the 2001 and 2002 versions of the vehicle. The vehicles that NCDL and J.K. following manner: NCDL states that a vehicle believe are substantially similar are Standard No. 110 Tire Selection and identification number (VIN) plate must 2001 and 2002 Porsche GT2 Turbo Rims: installation of a tire information be affixed to non-U.S. certified 2002 passenger cars that were manufactured placard. Porsche GT2 Turbo passenger cars to for importation into, and sale in, the Standard No. 111 Rearview Mirrors: meet the requirements of 49 CFR part United States and certified by their replacement of the passenger side 565. J.K. claims that both the 2001 and manufacturer as conforming to all rearview mirror with a U.S.-model 2002 versions of the vehicle have a applicable Federal motor vehicle safety component, or inscription of the factory installed VIN plate in the standards. required warning statement on the windshield area that meets these The petitioners claim that that they surface of that mirror. requirements. have carefully compared non-U.S. Standard No. 114 Theft Protection: Interested persons are invited to certified 2001 and 2002 Porsche GT2 programming of the warning system to submit comments on the petitions Turbo passenger cars to their U.S.- meet the standard. described above. Comments should refer certified counterparts, and found the Standard No. 208 Occupant Crash to the docket number and be submitted vehicles to be substantially similar with Protection: inspection of all vehicles to: Docket Management, Room PL–401, respect to compliance with most Federal and replacement of the driver’s and 400 Seventh St., SW, Washington, DC motor vehicle safety standards. passenger’s side air bags, knee bolsters, 20590. [Docket hours are from 9 am to NCDL and J.K. submitted information control units, sensors, and seat belts 5 pm]. It is requested but not required with their petitions intended to with U.S.-model components on that 10 copies be submitted. demonstrate that non-U.S. certified 2001 vehicles that are not already so All comments received before the and 2002 Porsche GT2 Turbo passenger equipped. J.K. states that the front and close of business on the closing date cars, as originally manufactured for sale rear outboard designated seating indicated above will be considered, and in Europe, conform to many Federal positions have combination lap and will be available for examination in the motor vehicle safety standards in the shoulder belts that are self-tensioning docket at the above address both before VerDate 11 and after that date. To the extent revoke the exemption under 49 U.S.C. ACTION: Notice. possible, comments filed after the 10502(d) may be filed at any time. The closing date will also be considered. filing of a petition to revoke will not SUMMARY: This is Supplement No. 18 to Notice of final action on the petitions automatically stay the transaction. the Treasury Department Circular 570; will be published in the Federal An original and 10 copies of all 2001 Revision, published July 2, 2001, Register pursuant to the authority pleadings, referring to STB Finance at 66 FR 35024. indicated below. Docket No. 34184, must be filed with the Surface Transportation Board, Office FOR FURTHER INFORMATION CONTACT: Authority: 49 U.S.C. 30141(a)(1)(A) and Surety Bond Branch at (202) 874–6765. (b)(1); 49 CFR 593.8; delegations of authority of the Secretary, Case Control Unit, 1925 at 49 CFR 1.50 and 501.8. K Street, NW., Washington, DC 20423– SUPPLEMENTARY INFORMATION: Atlantic 0001. In addition, a copy of each Issued on: April 3, 2002. Alliance Fidelity and Surety Company, pleading must be served on Michael E. a New Jersey corporation, has formally Marilynne Jacobs, Roper, 2500 Lou Menk Drive, P.O. Box changed its name to the Guarantee Office of Vehicle Safety Compliance. 961039, Fort Worth, TX 76161–0039. [FR Doc. 02–8519 Filed 4–8–02; 8:45 am] Board decisions and notices are Company of North America USA, effective March 1, 2002. The Company BILLING CODE 4910–59–P available on our website at WWW.STB.DOT.GOV.’’ was last listed as an acceptable surety Decided: April 1, 2002. on Federal bonds at 66 FR 35029, July DEPARTMENT OF TRANSPORTATION By the Board, David M. Konschnik, 2, 2001. Director, Office of Proceedings. A Certificate of Authority as an Surface Transportation Board Vernon A. Williams, acceptable surety on Federal bonds, [STB Finance Docket No. 34184] Secretary. dated today, is hereby issued under [FR Doc. 02–8305 Filed 4–8–02; 8:45 am] Sections 9304 to 9308 of Title 31 of the The Burlington Northern and Santa Fe BILLING CODE 4915–00–P United States Code, to The Guarantee Railway Company–Trackage Rights Company of North America USA, Mt. Exemption–Southern Gulf Railway Laurel, New Jersey. This new Certificate Company DEPARTMENT OF THE TREASURY replaces the Certificate of Authority Southern Gulf Railway Company issued to the Company under its former Customs Service (SGR), pursuant to a written trackage name. The underwriting limitation of rights agreement entered into between Notice of Revocation of Customs $300,000 established for the Company SGR and The Burlington Northern and Broker License as of July 2, 2001, remains unchanged Santa Fe Railway Company (BNSF), has until June 30, 2002. agreed to grant limited, nonexclusive AGENCY: Customs Service, Department of the Treasury. Certificates of Authority expire on overhead trackage rights to BNSF over June 30, each year, unless revoked prior SGR’s rail line between SGR milepost ACTION: General notice. to that date. The Certificates are subject 0.0 and SGR milepost 4.28, a distance of SUMMARY: Pursuant to section 641 of the to subsequent annual renewal as long approximately 4.28 miles, in the Tariff Act of 1930 as amended (19 vicinity of Sulphur, LA, for the purpose the Company remains qualified (31 CFR U.S.C. 1641) and the Customs part 223). A list of qualified companies of serving the Roy S. Nelson Generating Regulations [19 CFR 111.45(a)], the Station (Plant) of Entergy Gulf States, is published annually as of July 1, in the following Customs broker license is Department Circular 570, which Inc. BNSF will operate its own trains revoked by operation of law. with its own crews over SGR’s line outlines details as to underwriting under the trackage rights agreement.1 Name License Port limitations, areas in which licensed to Operations under the exemption were transact surety business and other scheduled to begin on March 27, 2002, Sprint Custom 17315 New York. information. Federal bond-approving the effective date of the exemption (7 House Brokerage, officers should annotate their reference days after the notice was filed). Inc. copies of the Treasury Circular 570, As a condition to this exemption, any 2002 Revision, at pages 35029 and employees affected by the trackage Dated: April 1, 2002. 35040 to reflect this change. rights will be protected by the Bonni G. Tischler, The Circular may be viewed and conditions imposed in Norfolk and Assistant Commissioner, Office of Field downloaded through the Internet at Western Ry. Co.–Trackage Rights–BN, Operations. www.fms.treas.gov/c570. A hard copy 354 I.C.C. 605 (1978), as modified in [FR Doc. 02–8488 Filed 4–8–02; 8:45 am] may be purchased from the Government Mendocino Coast Ry., Inc.–Lease and BILLING CODE 4820–02–P Operate, 360 I.C.C. 653 (1980). Printing Office (GPO), Subscription This notice is filed under 49 CFR Service, Washington, DC, telephone (202) 512–1800. When ordering the 1180.2(d)(7). If the notice contains false DEPARTMENT OF THE TREASURY or misleading information, the Circular from GPO, use the following exemption is void ab initio. Petitions to Fiscal Service stock number: 769–004–40671. Questions concerning this notice may 1 Pursuant to 49 CFR 1180.4(g), a railroad must Surety Companies Acceptable on be directed to the U.S. Department of file a verified notice with the Board at least 7 days Federal Bonds: Name Change— the Treasury, Financial Management before the trackage rights are to be consummated. Atlantic Alliance Fidelity and Surety Service, Financial Accounting and In its verified notice, BNSF indicates that it has Company been providing service to the Plant pursuant to the Services Division, Surety Bond Branch, trackage rights agreement dated February 17, 2000, AGENCY: Financial Management Service, 3700 East-West Highway, Room 6F07, prior to the filing of its verified notice of exemption. BNSF, states that, due to an oversight, it did not file Fiscal Service, Department of the Hyattsville, MD 20782. its exemption with the Board until March 20, 2002. Treasury. VerDate 11 Dated: April 1, 2002. Dorothy E. Martin, Acting Director, Financial Accounting and Service Division, Financial Management Service. [FR Doc. 02–8526 Filed 4–8–02; 8:45 am] BILLING CODE 4810–35–M VerDate 11 Corrections Federal Register Vol. 67, No. 68 Tuesday, April 9, 2002 This section of the FEDERAL REGISTER November 20, 2001, make the following contains editorial corrections of previously correction: published Presidential, Rule, Proposed Rule, and Notice documents. These corrections are Due to several errors, the table titled prepared by the Office of the Federal ‘‘TREATMENT STANDARDS FOR Register. Agency prepared corrections are HADARDOUS WASTES’’ that appears issued as signed documents and appear in on pages 58298 and 58299 is being the appropriate document categories reprinted in its entirety. elsewhere in the issue. § 268.40 [Corrected] * * * * * ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 268 [SWH–FRL–7099–2] RIN 2050–AE49 Hazardous Waste Management System; Identification and Listing of Hazardous Waste: Inorganic Chemical Manufacturing Wastes; Land Disposal Restrictions for Newly Identified Wastes; and CERCLA Hazardous Substance Designation and Reportable Quantities Correction In rule document 01–27833 beginning on page 58257 in the issue of Tuesday, TREATMENT STANDARDS FOR HAZARDOUS WASTES [Note: NA means not applicable] Regulated hazardous constituent Wastewaters Nonwastewaters Concentration in Waste description and treatment/ Waste code Concentration in mg/kg 5 unless regulatory Subcategory 1 Common name CAS 2 No. mg/L 3, or Tech- noted as ‘‘mg/L nology Code 4 TCLP’’, or Tech- nology Code ******* K176 ...... Baghouse filters from the produc- Antimony 7440–36–0 1.9 1.15 mg/L TCLP tion of antimony oxide, including Arsenic 7440–38–2 1.4 5.0 mg/L TCLP filters from the production of Cadmium 7440–43–9 0.69 0.11 mg/L TCLP intermediates (e.g., antimony Lead 7439–92–1 0.69 0.75 mg/L TCLP metal or crude antimony oxide) Mercury 7439–97–6 0.15 0.025 mg/L TCLP K177 ...... Slag from the production of anti- Antimony 7440–36–0 1.9 1.15 mg/L TCLP mony oxide that is speculatively Arsenic 7440–38–2 1.4 5.0 mg/L TCLP accumulated or disposed, in- Lead 7439–92–1 0.69 0.75 mg/L TCLP cluding slag from the production of intermediates (e.g., antimony metal or crude antimony oxide) VerDate 11 TREATMENT STANDARDS FOR HAZARDOUS WASTES—Continued [Note: NA means not applicable] Regulated hazardous constituent Wastewaters Nonwastewaters Concentration in Waste description and treatment/ Waste code Concentration in mg/kg 5 unless regulatory Subcategory 1 Common name CAS 2 No. mg/L 3, or Tech- noted as ‘‘mg/L nology Code 4 TCLP’’, or Tech- nology Code K178 ...... Residues from manufacturing and 1,2,3,4,6,7,8- Heptachlorodibenzo- 35822–39–4 0.000035 or 0.0025 or manufacturing-site storage of p-dioxin (1,2,3,4,6,7,8-HpCDD) CMBST 11 CMBST 11 ferric chloride from acids formed during the production of titanium 1,2,3,4,6,7,8- 67562–39–4 0.000035 or 0.0025 or dioxide using the chloride-ilmen- Heptachlorodibenzofuran CMBST 11 CMBST 11 ite process. (1,2,3,4,6,7,8-HpCDF) 1,2,3,4,7,8,9- 55673–89–7 0.000035 or 0.0025 or Heptachlorodibenzofuran CMBST 11 CMBST 11 (1,2,3,4,7,8,9-HpCDF) HxCDDs (All Hexachlorodibenzo- 34465–46–8 0.000063 or 0.001 or p-dioxins) CMBST 11 CMBST 11 HxCDFs (All Hexachlorodibenzo- 55684–94–1 0.000063 or 0.001 or furans) CMBST 11 CMBST 11 1,2,3,4,6,7,8,9- 3268–87–9 0.000063 or 0.005 or Octachlorodibenzo-p-dioxin CMBST 11 CMBST 11 (OCDD) 1,2,3,4,6,7,8,9- 39001–02–0 0.000063 or 0.005 or Octachlorodibenzofuran (OCDF) CMBST 11 CMBST 11 PeCDDs (All Pentachlorodibenzo- 36088–22–9 0.000063 or 0.001 or p-dioxins) CMBST 11 CMBST 11 PeCDFs (All Pentachlorodibenzo- 30402–15–4 0.000035 or 0.001 or furans) CMBST 11 CMBST 11 TCDDs (All tetrachlorodibenzo-p- 41903–57–5 0.000063 or 0.001 or dioxins) CMBST 11 CMBST 11 TCDFs (All tetrachlorodibenzo- 55722–27–5 0.000063 or 0.001 or furans) CMBST 11 CMBST 11 Thallium 7440–28–0 1.4 0.20 mg/L TCLP ******* ***** Footnotes to Treatment Standard Table 268.40: 1 The waste descriptions provided in this table do not replace waste descriptions in 40 CFR part 261. Descriptions of Treatment/Regulatory Subcategories are provided, as needed, to distinguish between applicability of different standards. 2 CAS means Chemical Abstract Services. When the waste code and/or regulated constituents are described as a combination of a chemical with its salts and/or esters, the CAS number is given for the parent compound only. 3 Concentration standards for wastewaters are expressed in mg/L and are based on analysis of composite samples. 4 All treatment standards expressed as a Technology Code or combination of Technology Codes are explained in detail in 40 CFR 268.42 Table 1—Technology Codes and Descriptions of Technology-Based Standards. 5 Except for Metals (EP or TCLP) and Cyanides (Total and Amenable) the nonwastewater treatment standards expressed as a concentration were established, in part, based upon incineration in units operated in accordance with the technical requirements of 40 CFR part 264, Subpart O or 40 CFR part 265, Subpart O, or based upon combustion in fuel substitution units operating in accordance with applicable technical require- ments. A facility may comply with these treatment standards according to provisions in 40 CFR 268.40(d). All concentration standards for nonwastewaters are based on analysis of grab samples. ***** 11 For these wastes, the definition of CMBST is limited to: (1) combustion units operating under 40 CFR 266, (2) combustion units permitted under 40 CFR part 264, Subpart O, or (3) combustion units operating under 40 CFR 265, Subpart O, which have obtained a determination of equivalent treatment under 268.42(b). ***** [FR Doc. C1–27833 Filed 4–8–02; 8:45 am] BILLING CODE 1505–01–D VerDate 11 Part II Environmental Protection Agency 40 CFR Parts 9, et al. National Pollutant Discharge Elimination System—Proposed Regulations to Establish Requirements for Cooling Water Intake Structures at Phase II Existing Facilities; Proposed Rule VerDate 11 ENVIRONMENTAL PROTECTION available requirements under this Avenue, NW., Washington, DC 20460. AGENCY proposed rule. These options include Comments delivered in person demonstrating that the facility subject to (including overnight mail) should be 40 CFR Parts 9, 122, 123, 124, and 125 the proposed rule currently meet submitted to the Cooling Water Intake [FRL–7154–7] specified performance standards; Structure (Existing Facilities: Phase II) selecting and implementing design and Proposed Rule Comment Clerk—W–00– RIN 2040–AD62 construction technologies, operational 32, Water Docket, Room EB 57, 401 M measures, or restoration measures that Street, SW., Washington, DC 20460. You National Pollutant Discharge meet specified performance standards; also may submit comments Elimination System—Proposed or demonstrating that the facility electronically to [email protected]. Regulations to Establish Requirements qualifies for a site-specific Please submit any references cited in for Cooling Water Intake Structures at Phase II Existing Facilities determination of best technology your comments. Please submit an available because its costs of original and three copies of your written AGENCY: Environmental Protection compliance are either significantly comments and enclosures. For Agency (EPA). greater than those considered by the additional information on how to ACTION: Proposed rule. Agency during the development of this submit comments, see ‘‘SUPPLEMENTARY proposed rule, or the facility’s costs of INFORMATION, How May I Submit SUMMARY: Today’s proposed rule would compliance would be significantly Comments?’’ implement section 316(b) of the Clean greater than the environmental benefits EPA has prepared an Information Water Act (CWA) for certain existing of compliance with the proposed Collection Request (ICR) under the power producing facilities that employ performance standards. The proposed Paperwork Reduction Act for this a cooling water intake structure and that rule also provides that facilities may use proposed rule (EPA ICR number withdraw 50 million gallons per day restoration measures in addition to or in 2060.01). For further information or a (MGD) or more of water from rivers, lieu of technology measures to meet copy of the ICR contact Susan Auby by streams, lakes, reservoirs, estuaries, performance standards or in phone at (202) 260–4901, e-mail at oceans, or other waters of the U.S. for establishing best technology available [email protected] or cooling purposes. The proposed rule on a site-specific basis. download off the internet at http:// constitutes Phase II in EPA’s EPA expects that this proposed www.epa.gov/icr. Send comments on development of section 316(b) regulation would minimize adverse the Agency’s need for this information, regulations and would establish environmental impact, including the accuracy of the burden estimates, national requirements applicable to the substantially reducing the harmful and any suggested methods for location, design, construction, and effects of impingement and entrainment, minimizing respondent burden capacity of cooling water intake at existing facilities over the next 20 (including the use of automated structures at these facilities. The years. As a result, the Agency collection techniques) to the following proposed national requirements, which anticipates that this proposed rule addresses. Please refer to EPA ICR would be implemented through would help protect ecosystems in Number 2060.01 in any correspondence. National Pollutant Discharge proximity to cooling water intake Ms. Susan Auby, U.S. Environmental Elimination System (NPDES) permits, structures. Today’s proposal would help Protection Agency, OP Regulatory would minimize the adverse preserve aquatic organisms, including Information Division (2137), 401 M environmental impact associated with threatened and endangered species, and Street, SW., Washington, DC 20460. the use of these structures. the ecosystems they inhabit in waters and Today’s proposed rule would used by cooling water intake structures Office of Information and Regulatory establish location, design, construction, at existing facilities. EPA has considered Affairs, Office of Management and and capacity requirements that reflect the potential benefits of the proposed Budget, Attention: Desk Officer for the best technology available for rule and in the preamble discusses these EPA 725 17th Street, NW, minimizing adverse environmental benefits in both quantitative and non- Washington, DC 20503. impact from the cooling water intake quantitative terms. Benefits, among structure based on water body type, and FOR FURTHER INFORMATION CONTACT: For the amount of water withdrawn by a other factors, are based on a decrease in additional technical information contact facility. The Environmental Protection expected mortality or injury to aquatic Deborah G. Nagle at (202) 566–1063. For Agency (EPA) proposes to group surface organisms that would otherwise be additional economic information water into five categories—freshwater subject to entrainment into cooling contact Lynne Tudor, Ph.D. at (202) rivers and streams, lakes and reservoirs, water systems or impingement against 566–1043. For additional biological Great Lakes, estuaries and tidal rivers, screens or other devices at the entrance information contact Dana A. Thomas, and oceans—and establish requirements of cooling water intake structures. Ph.D. at (202) 566–1046. The e-mail for cooling water intake structures Benefits may also accrue at population, address for the above contacts is located in distinct water body types. In community, or ecosystem levels of ‘‘[email protected].’’ ecological structures. general, the more sensitive or SUPPLEMENTARY INFORMATION: biologically productive the waterbody, DATES: Comments on this proposed rule the more stringent the requirements and Information Collection Request What Entities Are Potentially Regulated proposed as reflecting the best (ICR) must be received or postmarked by This Action? technology available for minimizing on or before midnight July 8, 2002. This proposed rule would apply to adverse environmental impact. ADDRESSES: Public comments regarding ‘‘Phase II existing facilities,’’ i.e., Proposed requirements also vary this proposed rule should be submitted existing facilities that both generate and according to the percentage of the by mail to: Cooling Water Intake transmit electric power or that generate source waterbody withdrawn, and Structure (Existing Facilities: Phase II) electric power for sale to another entity facility utilization rate. Proposed Rule Comment Clerk—W–00– for transmission; use one or more A facility may choose one of three 32, Water Docket, Mail Code 4101, EPA, cooling water intake structures to options for meeting best technology Ariel Rios Building,1200 Pennsylvania withdraw water from waters of the U.S.; VerDate 11 have or require a National Pollutant professional judgment. EPA intends to The following exhibit lists the types Discharge Elimination System (NPDES) address such facilities in a future of entities that EPA is now aware permit issued under section 402 of the rulemaking effort. This proposal defines potentially could be subject to this CWA; and meet proposed flow the term ‘‘cooling water intake proposed rule. This exhibit is not thresholds. 1 Existing electric power structure’’ to mean the total physical intended to be exhaustive, but rather generating facilities subject to this structure and any associated provides a guide for readers regarding proposal would include those that use constructed waterways used to entities likely to be regulated by this cooling water intake structures to withdraw water from waters of the U.S. action. Types of entities not listed in the withdraw fifty (50) million gallons per The cooling water intake structure exhibit could also be regulated. To day (MGD) or more and that use at least extends from the point at which water determine whether your facility would twenty-five (25) percent of water is withdrawn from the surface water be regulated by this action, you should withdrawn solely for cooling purposes. source up to, and including, the intake carefully examine the applicability If a facility that otherwise would be criteria proposed at § 125.91 of the pumps. The category of facilities that subject to the proposed rule does not proposed rule. If you have questions would meet the proposed cooling water meet the fifty (50) MGD design intake regarding the applicability of this action flow or twenty-five (25) percent cooling intake structure criteria for existing to a particular entity, consult one of the water threshold, the permit authority facilities are electric power generation persons listed for technical information would implement section 316(b) on a utilities and nonutility power in the preceding FOR FURTHER case-by-case basis, using best producers. INFORMATION CONTACT section. Standard Industrial North American Industry Category Examples of regulated entitles Classification (SIC) Classification System codes (NAICS) codes Federal, State, and Local Govern- Operators of steam electric generating point source 4911 and 493 ...... 221112, 221113, 221119, ment. dischargers that employ cooling water intake struc- 221121, 221122. tures. Industry ...... Steam electric generating (this includes utilities and 4911 and 493 ...... 221112, 221113, 221119, nonutilities). 221121, 221122. Supporting Documentation filed under docket number W–00–32 or 9 format or in ASCII file format. The proposed Phase II regulation is (Phase II Existing Facility proposed Electronic comments on this notice may supported by three major documents: rule). The record is available for be filed on-line at many Federal 1. Economic and Benefits Analysis for inspection from 9 a.m. to 4 p.m. on depository libraries. Monday through Friday, excluding legal the Proposed Section 316(b) Phase II Organization of This Document holidays, at the Water Docket, Room EB Existing Facilities Rule (EPA–821–R– I. Legal Authority, Purpose of Today’s 02–001), hereafter referred to as the 57, USEPA Headquarters, 401 M Street, SW, Washington, DC 20460. For access Proposal, and Background EBA. This document presents the A. Legal Authority to docket materials, please call (202) analysis of compliance costs, closures, B. Purpose of Today’s Proposal energy supply effects and benefits 260–3027 to schedule an appointment C. Background associated with the proposed rule. during the hours of operation stated II. Scope and Applicability of the Proposed above. 2. Case Study Analysis for the Rule Proposed Section 316(b) Phase II How May I Submit Comments? A. What Is an ‘‘Existing Facility’’ for Existing Facilities Rule (EPA–821–R– Purposes of the Section 316(b) Proposed 02–002), hereafter referred to as the To ensure that EPA can read, Phase II Rule? B. What Is a ‘‘Cooling Water Intake Case Study Document. This document understand, and therefore properly Structure’’? presents the information gathered from respond to comments, the Agency requests that you cite, where possible, C. Is My Facility Covered If It Withdraws the watershed and facility level case From Waters of the U.S.? studies and methodology used to the paragraph(s) or sections in the preamble, rule, or supporting D. Is My Facility Covered If It Is a Point determine baseline impingement and Source Discharger Subject to an NPDES entrainment losses. documents to which each comment Permit? 3. Technical Development Document refers. You should use a separate E. Who Is Covered Under the Thresholds for the Proposed Section 316(b) Phase II paragraph for each issue you discuss. Included in This Proposed Rule? Existing Facilities Rule (EPA–821–R– If you want EPA to acknowledge F. When Must a Phase II Existing Facility 02–003), hereafter referred to as the receipt of your comments, enclose a Comply With the Proposed Technical Development Document. This self-addressed, stamped envelope. No Requirements? document presents detailed information faxes will be accepted. Electronic G. What Special Definitions Apply to This on the methods used to develop unit comments must be submitted as a Proposal WordPerfect 5.1, 6.1, 8, or 9 format, or III. Summary of Data Collection Activities costs and describes the set of A. Existing Data Sources technologies that may be used to meet an ASCII file or file avoiding the use of B. Survey Questionnaires the proposed rule’s requirements. special characters and forms of C. Site Visits encryption. Electronic comments must How May I Review the Public Record? D. Data Provided to EPA by Industrial, be identified by the docket number W– Trade, Consulting, Scientific or The record (including supporting 00–32. EPA will accept comments and Environmental Organizations or by the documentation) for this proposed rule is data on disks in WordPerfect 5.1, 6.1, 8 General Public 1 January 17, 2002 and certain modifications and Proposed § 125.93 defines ‘‘existing facility’’ as additions to such facilities. any facility that commenced construction before VerDate 11 IV. Overview of Facility Characteristics I. Legal Authority, Purpose of Today’s cooling water intake structures for large (Cooling Water Systems & Intakes) for Proposal, and Background cooling water intake structures at Phase Industries Potentially Subject to II existing facilities. In doing so, the A. Legal Authority Proposed Rule Agency is proposing to revise the V. Environmental Impacts Associated With Today’s proposed rule is issued under approach adopted in the 1977 draft Cooling Water Intake Structures the authority of sections 101, 301, 304, guidance which was based on the VI. Best Technology Available for 306, 308, 316, 401, 402, 501, and 510 of judgment that ‘‘[t]he decision as to best Minimizing Adverse Environmental the Clean Water Act (CWA), 33 U.S.C. Impact at Phase II Existing Facilities technology available for intake design 1251, 1311, 1314, 1316, 1318, 1326, location, construction, and capacity A. What Is the Best Technology Available 1341, 1342, 1361, and 1370. This for Minimizing Adverse Environmental must be made on a case-by-case basis.’’ Impact at Phase II Existing Facilities? proposal partially fulfills the obligations Other important differences from the B. Other Technology Based Options Under of the U.S. Environmental Protection 1977 draft guidance include today’s Consideration Agency (EPA) under a consent decree in proposed definition of a ‘‘cooling water C. Site-Specific Based Options Under Riverkeeper Inc., et al. v. Whitman, intake structure.’’ Today’s proposal also Consideration United States District Court, Southern would establish a cost-benefit test that D. Why EPA Is Not Considering Dry District of New York, No. 93 Civ. 0314 is different from the ‘‘wholly Cooling Anywhere? (AGS). disproportionate’’ cost-benefit test that E. What is the Role of Restoration and has been in use since the 1970s. Trading? B. Purpose of Today’s Proposal VII. Implementation Section 316(b) of the CWA provides Although EPA’s judgment is that the A. When Does the Proposed Rule Become that any standard established pursuant requirements proposed today would Effective? to section 301 or 306 of the CWA and best implement section 316(b) at Phase B. What Information Must I Submit to the applicable to a point source must II existing facilities, the Agency is also Director When I Apply for My Reissued require that the location, design, inviting comment on a broad array of NPDES Permit? construction, and capacity of cooling other alternatives, including, for C. How Would the Director Determine the water intake structures reflect the best example, more stringent technology- Appropriate Cooling Water Intake technology available (BTA) for based requirements and a framework Structure Requirements? under which Directors would continue D. What Would I Be Required To Monitor? minimizing adverse environmental impact. Today’s proposed rule would to evaluate adverse environmental E. How Would Compliance Be impact and determine the best Determined? establish requirements, reflecting the F. What Are the Respective Federal, State, best technology available for technology available for minimizing and Tribal Roles? minimizing adverse environmental such impact on a wholly site-specific G. Are Permits for Existing Facilities impact, applicable to the location, basis. Because the Agency is inviting Subject to Requirements Under Other design, construction, and capacity of comment on a broad range of Federal Statutes? cooling water intake structures at Phase alternatives for potential promulgation, H. Alternative Site-Specific Requirements II existing power generating facilities today’s proposal is not intended as VIII. Economic Analysis that withdraw at least fifty (50) MGD of guidance for determining the best A. Proposed Rule cooling water from waters of the U.S. technology available to minimize the B. Alternative Regulatory Options Today’s proposal would define a adverse environmental impact of IX. Benefit Analysis cooling water intake structure as the cooling water intake structures at A. Overview of Benefits Discussion potentially regulated Phase II existing B. The Physical Impacts of Impingement total physical structure, including the and Entrainment pumps, and any associated constructed facilities. Until the Agency promulgates C. Impingement and Entrainment Impacts waterways used to withdraw water from final regulations based on today’s and Regulatory Benefits Are Site-Specific waters of the U.S. Cooling water absorbs proposal, Directors should continue to D. Data and Methods Used to Estimate waste heat rejected from processes make section 316(b) determinations Benefits employed or from auxiliary operations with respect to existing facilities, which E. Summary of Benefits Findings: Case on a facility’s premises. Single cooling may be more or less stringent than Studies water intake structures might have today’s proposal, on a case-by-case basis F. Estimates of National Benefits multiple intake bays. In 1977 EPA applying best professional judgment. X. Administrative Requirements issued draft guidance for determining Today’s proposal would not apply to A. E.O. 12866: Regulatory Planning and the best technology available to existing manufacturing facilities or to Review power generating facilities that B. Paperwork Reduction Act minimize adverse environmental impact C. Unfunded Mandates Reform Act from cooling water intake structures. In withdraw less than fifty (50) MGD of D. Regulatory Flexibility Act as Amended the absence of section 316(b) regulations cooling water. These facilities will be by SBREFA (1996) or final guidance, the 1977 draft addressed in a separate rulemaking, E. E.O. 12898: Federal Actions to Address guidance has served as applicable referred to as the Phase III rule (see Environmental Justice in Minority guidance for section 316(b) section I.C.2., below). In the interim, Populations and Low-Income determinations. See Draft Guidance for these facilities are subject to section Populations Evaluating the Adverse Impact of 316(b) requirements established by F. E.O. 13045: Protection of Children From Cooling Water Intake Structures on the permitting authorities on a case-by-case Environmental Health Risks and Safety Aquatic Environment: Section 316(b) basis, using best professional judgment. Risks Pub. L. 92–500 (U.S. EPA, 1977). Upon promulgation of final regulations G. E.O. 13175: Consultation and based on today’s proposal, the Agency Coordination With Indian Tribal Administrative determinations in Governments several permit proceedings also have will address the extent to which the H. E.O. 13158: Marine Protected Areas served as de facto guidance. final regulations and preamble should I. E.O. 13211: Energy Effects Today, EPA proposes a national serve as guidance for developing section J. National Technology Transfer and framework that would establish certain 316(b) requirements for Phase III Advancement Act minimum requirements for the location, facilities prior to the promulgation of K. Plain Language Directive design, capacity, and construction of the Phase III regulations. VerDate 11 EPA and State permitting authorities basis for the limitations required in also routinely include monitoring and should use existing guidance and NPDES permits. reporting requirements, standard information to form their best Today’s proposed rule would conditions, and special conditions. professional judgment in issuing implement section 316(b) of the CWA as Sections 301, 304, and 306 of the permits to existing facilities. EPA’s draft it applies to ‘‘Phase II existing facilities’’ CWA require that EPA develop Guidance for Evaluating the Adverse as defined in this proposal. Section technology-based effluent limitations Impact of Cooling Water Intake 316(b) addresses the adverse guidelines and new source performance Structures on the Aquatic Environment: environmental impact caused by the standards that are used as the basis for Section 316(b) (May 1, 1977), continues intake of cooling water, not discharges technology-based minimum discharge to be applicable for existing facilities into water. Despite this special focus, requirements in wastewater discharge pending EPA’s issuance of final the requirements of section 316(b) are permits. EPA issues these effluent regulations under section 316(b). Two closely linked to several of the core limitations guidelines and standards for background papers that EPA prepared in elements of the NPDES permit program categories of industrial dischargers 1994 and 1996 to describe cooling water established under section 402 of the based on the pollutants of concern intake technologies being used or tested CWA to control discharges of pollutants discharged by the industry, the degree for minimizing adverse environmental into navigable waters. For example, of control that can be attained using impact also contain information that section 316(b) applies to facilities that various levels of pollution control could be useful to permit writers. withdraw water from the waters of the technology, consideration of various (Preliminary Regulatory Development, United States for cooling through a economic tests appropriate to each level cooling water intake structure and are of control, and other factors identified Section 316(b) of the Clean Water Act, point sources subject to an NPDES in sections 304 and 306 of the CWA Background Paper Number 3: Cooling permit. Conditions implementing (such as non-water quality Water Intake Technologies (1994) and section 316(b) are included in NPDES environmental impacts including energy Draft Supplement to Background Paper permits and would continue to be impacts). EPA has promulgated Number 3: Cooling Water Intake included in such permits under this regulations setting effluent limitations Technologies.) Fact sheets from recent proposed rule. guidelines and standards under sections 316(b) State and Regional permits are Section 301 of the CWA prohibits the 301, 304, and 306 of the CWA for more another source of potentially relevant discharge of any pollutant by any than 50 industries. See 40 CFR parts 405 information. The evaluations of the person, except in compliance with through 471. Among these, EPA has costs and efficacies of technologies specified statutory requirements. These established effluent limitations presented in the Technical Development requirements include compliance with guidelines that apply to most of the Document for the Final Regulations technology-based effluent limitations industry categories that use cooling Addressing Cooling Water Intake guidelines and new source performance water intake structures (e.g., steam Structures for New Facilities, EPA–821– standards, water quality standards, electric power generation, iron and steel R–01–036, November 2001 may also be NPDES permit requirements, and manufacturing, pulp and paper relevant on some cases, although costs certain other requirements. manufacturing, petroleum refining, for some technologies will differ Section 402 of the CWA provides chemical manufacturing). between new and existing facilities. authority for EPA or an authorized State Section 306 of the CWA requires that EPA and State decision-makers retain or Tribe to issue an NPDES permit to EPA establish discharge standards for the discretion to adopt approaches on a any person discharging any pollutant or new sources. For purposes of section case-by-case basis that differ from combination of pollutants from a point 306, new sources include any source applicable guidance where appropriate. source into waters of the U.S. Forty-four that commenced construction after the Any decisions on a particular facility States and one U.S. territory are promulgation of applicable new source should be based on the requirements of authorized under section 402(b) to performance standards, or after proposal section 316(b). administer the NPDES permitting of applicable standards of performance program. NPDES permits restrict the if the standards are promulgated in C. Background types and amounts of pollutants, accordance with section 306 within 120 1. The Clean Water Act including heat, that may be discharged days of proposal. CWA section 306; 40 from various industrial, commercial, CFR 122.2. New source performance The Federal Water Pollution Control and other sources of wastewater. These standards are similar to the technology- Act, also known as the Clean Water Act permits control the discharge of based limitations established for Phase (CWA), 33 U.S.C. 1251 et seq., seeks to pollutants primarily by requiring II existing sources, except that new ‘‘restore and maintain the chemical, dischargers to meet effluent limitations source performance standards are based physical, and biological integrity of the and other permit conditions. Effluent on the best available demonstrated nation’s waters.’’ 33 U.S.C. 1251(a). The limitations may be based on technology instead of the best available CWA establishes a comprehensive promulgated federal effluent limitations technology economically achievable. regulatory program, key elements of guidelines, new source performance New facilities have the opportunity to which are (1) a prohibition on the standards, or the best professional install the best and most efficient discharge of pollutants from point judgment of the permit writer. production processes and wastewater sources to waters of the U.S., except as Limitations based on these guidelines, treatment technologies. Therefore, authorized by the statute; (2) authority standards, or best professional judgment Congress directed EPA to consider the for EPA or authorized States or Tribes are known as technology-based effluent best demonstrated process changes, in- to issue National Pollutant Discharge limits. Where technology-based effluent plant controls, and end-of-process Elimination System (NPDES) permits limits are inadequate to ensure control and treatment technologies that that regulate the discharge of pollutants; compliance with water quality reduce pollution to the maximum extent and (3) requirements for EPA to develop standards applicable to the receiving feasible. In addition, in establishing new effluent limitations guidelines and water, more stringent effluent limits source performance standards, EPA is standards and for States to develop based on applicable water quality required to take into consideration the water quality standards that are the standards are required. NPDES permits cost of achieving the effluent reduction VerDate 11 and any non-water quality CWA section 316(b). It also added a new design, location, construction, and environmental impacts and energy part 402, which included three sections: capacity must be made on a case-by-case requirements. (1) § 402.10 (Applicability), (2) § 402.11 basis.’’ (Section 316(b) Draft Guidance, (Specialized definitions), and (3) U.S. EPA, 1977, p. 4). This case-by-case 2. Consent Decree § 402.12 (Best technology available for approach also is consistent with the Today’s proposed rule partially cooling water intake structures). Section approach described in the 1976 fulfills EPA’s obligation to comply with 402.10 stated that the provisions of part Development Document referenced in an Amended Consent Decree. The 402 applied to ‘‘cooling water intake the remanded regulation. Amended Consent Decree was filed on structures for point sources for which The 1977 section 316(b) draft November 22, 2000, in the United States effluent limitations are established guidance suggests a general process for District Court, Southern District of New pursuant to section 301 or standards of developing information needed to York, in Riverkeeper Inc., et al. v. performance are established pursuant to support section 316(b) decisions and Whitman, No. 93 Civ 0314 (AGS), a case section 306 of the Act.’’ Section 402.11 presenting that information to the brought against EPA by a coalition of defined the terms ‘‘cooling water intake permitting authority. The process individuals and environmental groups. structure,’’ ‘‘location,’’ ‘‘design,’’ involves the development of a site- The original Consent Decree, filed on ‘‘construction,’’ ‘‘capacity,’’ and specific study of the environmental October 10, 1995, provided that EPA ‘‘Development Document.’’ Section effects associated with each facility that was to propose regulations 402.12 included the following language: uses one or more cooling water intake implementing section 316(b) by July 2, The information contained in the structures, as well as consideration of 1999, and take final action with respect Development Document shall be considered that study by the permitting authority in to those regulations by August 13, 2001. in determining whether the location, design, determining whether the facility must Under subsequent interim orders and construction, and capacity of a cooling water make any changes for minimizing the Amended Consent Decree, EPA has intake structure of a point source subject to adverse environmental impact. Where divided the rulemaking into three standards established under section 301 or adverse environmental impact is phases and is working under new 306 reflect the best technology available for present, the 1977 draft guidance deadlines. As required by the Amended minimizing adverse environmental impact. suggests a stepwise approach that Consent Decree, on November 9, 2001, In 1977, fifty-eight electric utility considers screening systems, size, EPA took final action on a rule companies challenged these regulations, location, capacity, and other factors. governing cooling water intake arguing that EPA had failed to comply Although the draft guidance describes structures used by new facilities (Phase with the requirements of the the information that should be I). 66 FR 65255 (December 18, 2001). Administrative Procedure Act (APA) in developed, key factors that should be The Amended Consent Decree also promulgating the rule. Specifically, the considered, and a process for supporting requires that EPA issue this proposal by utilities argued that EPA had neither section 316(b) determinations, it does February 28, 2002, and take final action published the Development Document not establish uniform technology-based by August 28, 2003 (Phase II).2 The in the Federal Register nor properly national standards for best technology decree requires further that EPA incorporated the document into the rule available for minimizing adverse propose regulations governing cooling by reference. The United States Court of environmental impact. Rather, the water intake structures used, at a Appeals for the Fourth Circuit agreed guidance leaves the decisions on the minimum, by smaller-flow power plants and, without reaching the merits of the appropriate location, design, capacity, and factories in four industrial sectors regulations themselves, remanded the and construction of cooling water intake (pulp and paper making, petroleum and rule. Appalachian Power Co. v. Train, structures to the permitting authority. coal products manufacturing, chemical 566 F.2d 451 (4th Cir. 1977). EPA later Under this framework, the Director and allied manufacturing, and primary withdrew part 402. 44 FR 32956 (June determines whether appropriate studies metal manufacturing) by June 15, 2003, 7, 1979). 40 CFR 401.14 remains in have been performed and whether a and take final action by December 15, effect. given facility has minimized adverse 2004 (Phase III). Since the Fourth Circuit remanded environmental impact. EPA’s section 316(b) regulations in 3. What Other EPA Rulemakings and 1977, NPDES permit authorities have 4. New Facility Rule Guidance Have Addressed Cooling made decisions implementing section On November 9, 2001, EPA took final Water Intake Structures? 316(b) on a case-by-case, site-specific action on regulations governing cooling In April 1976 EPA published a rule basis. EPA published draft guidance water intake structures at new facilities. under section 316(b) that addressed addressing section 316(b) 66 FR 65255 (December 18, 2001). The cooling water intake structures. 41 FR implementation in 1977. See Draft final new facility rule (Phase I) 17387 (April 26, 1976), proposed at 38 Guidance for Evaluating the Adverse established requirements applicable to FR 34410 (December 13, 1973). The rule Impact of Cooling Water Intake the location, design, construction, and added a new § 401.14 to 40 CFR Chapter Structures on the Aquatic Environment: capacity of cooling water intake I that reiterated the requirements of Section 316(b) P.L. 92–500 (U.S. EPA, structures at new facilities that 1977). This draft guidance describes the withdraw at least two (2) million gallons 2 Under the Amended Consent Decree, EPA is to studies recommended for evaluating the per day (MGD) and use at least twenty- propose reuglations in Phase II that are ‘‘applicable to, at a minimum: (i) Existing utilities (i.e., facilities impact of cooling water intake five (25) percent of the water they that both generate and transmit electric power) that structures on the aquatic environment withdraw solely for cooling purposes. employ a cooling water intake structure, and whose and recommends a basis for determining EPA adopted a two-track approach. intake flow levels exceed a minimum threshold to the best technology available for Under Track I, for facilities with a be determined by EPA during the Phase II rulemaking process; and (ii) existing non-utility minimizing adverse environmental design intake flow more than 10 MGD, power producers (i.e., facilities that generate impact. The 1977 section 316(b) draft the capacity of the cooling water intake electric power but sell it to another entity for guidance states, ‘‘The environmental- structure is restricted, at a minimum, to transmission) that employa cooling water intake intake interactions in question are a level commensurate with that which structure, and whose intakeflow levels exceed a minimum threshold to be determined by EPA highly site-specific and the decision as could be attained by use of a closed- during the Phase II rulemaking process.’’ to best technology available for intake cycle recirculating system. For facilities VerDate 11 with a design intake flow more than 2 completion of the 316(b) survey,3 which In January, 2001, EPA also attended MGD, the design through-screen intake has been used as a source of data for the technical workshops organized by the velocity is restricted to 0.5 ft/s and the Phase II proposal, EPA conducted two Electric Power Research Institute and total quantity of intake is restricted to a public meetings on 316(b) issues. In the Utilities Water Act Group. These proportion of the mean annual flow of June 1998, in Arlington, Virginia (63 FR workshops focused on the presentation a freshwater river or stream, or to 27958) EPA conducted a public meeting of key issues associated with different maintain the natural thermal focused on a draft regulatory framework regulatory approaches considered under stratification or turnover patterns for assessing potential adverse the Phase I proposed rule and (where present) of a lake or reservoir environmental impacts from alternatives for addressing 316(b) except in cases where the disruption is impingement and entrainment. In requirements. determined to be beneficial to the September, 1998, in Alexandria, On May 23, 2001, EPA held a day- management of fisheries for fish and Virginia (63 FR 40683) EPA conducted long forum to discuss specific issues shellfish by any fishery management a public meeting focused on technology, associated with the development of agency(ies), or to a percentage of the cost, and mitigation issues. In addition, regulations under section 316(b) of the tidal excursions of a tidal river or in September 1998 and April 1999, EPA Clean Water Act. 66 FR 20658. At the estuary. In addition, an applicant with staff participated in technical meeting, 17 experts from industry, intake capacity greater than 10 MGD workshops sponsored by the Electric public interest groups, States, and must select and implement an Power Research Institute on issues academia reviewed and discussed the appropriate design and construction relating to the definition and assessment Agency’s preliminary data on cooling technology for minimizing impingement of adverse environmental impact. EPA water intake structure technologies that mortality and entrainment if certain staff have participated in other industry are in place at existing facilities and the environmental conditions exist. conferences, met upon request on costs associated with the use of (Applicants with 2–10 MGD flows are numerous occasions with industry available technologies for reducing not required to reduce capacity but must representatives, and met on a number of impingement and entrainment. Over install technologies for reducing occasions with representatives of 120 people attended the meeting. In August 21, 2001, EPA staff entrainment at all locations.) Under environmental groups. participated in a technical symposium Track II, the applicant has the In the months leading up to sponsored by the Electric Power opportunity to demonstrate that impacts publication of the proposed Phase I rule, Research Institute in association with to fish and shellfish, including EPA conducted a series of stakeholder the American Fisheries Society on important forage and predator species, meetings to review the draft regulatory issues relating to the definition and within the watershed will be framework for the proposed rule and assessment of adverse environmental comparable to these which it would invited stakeholders to provide their impact under section 316(b) of the achieve were it to implement the Track recommendations for the Agency’s CWA. I requirements for capacity and design consideration. EPA managers have met Finally, EPA has coordinated with the velocity. This demonstration can with the Utility Water Act Group, staff from the Nuclear Regulatory include the use of restoration measures Edison Electric Institute, representatives Commission (NRC) in the development such as habitat enhancement or fish from an individual utility, and with of this proposed rule to ensure that the restocking programs. Proportional flow representatives from the petroleum proposal does not conflict with NRC requirements also apply under Track II. refining, pulp and paper, and iron and safety requirements. NRC staff have With the new facility rule, EPA steel industries. EPA conducted several reviewed the proposed 316(b) rule and promulgated a national framework that meetings with environmental groups did not identify any apparent conflict establishes minimum requirements for attended by representatives from 15 with nuclear plant safety. NRC licensees the design, capacity, and construction of organizations. EPA also met with the would continue to be obligated to meet cooling water intake structures for new Association of State and Interstate Water NRC requirements for design and facilities. EPA believes that the final Pollution Control Administrators reliable operation of cooling systems. new facility rule establishes a (ASIWPCA) and, with the assistance of NRC staff recommended that EPA reasonable framework that creates ASIWPCA, conducted a conference call consider adding language which states certainty for permitting of new facilities, in which representatives from 17 states that in cases of conflict between an EPA while providing some flexibility to take or interstate organizations participated. requirement under this proposed rule site-specific factors into account. After publication of the proposed Phase and an NRC safety requirement, the I rule, EPA continued to meet with NRC safety requirement take 5. Public Participation stakeholders at their request. These precedence. EPA has added language to EPA has worked extensively with meetings are summarized in the record. address this concern to the proposed stakeholders from the industry, public EPA received many comments from rule. These coordination efforts and all interest groups, state agencies, and other industry stakeholders, government of the meetings described above are federal agencies in the development of agencies and private citizens on the documented or summarized in the this proposed rule. These public Phase I proposed rule 65 FR 49059 record. participation activities have focused on (August 10, 2000). EPA received II. Scope and Applicability of the various section 316(b) issues, including additional comments on the Notice of Proposed Rule general issues, as well as issues relevant Data Availability (NODA) 66 FR 28853 This proposed rule would apply to to development of the Phase I rule and (May 25, 2001). These comments have existing facilities as defined below, that issues relevant to the proposed Phase II informed the development of the Phase use a cooling water intake structure to rule. II proposal. withdraw water for cooling purposes In addition to outreach to industry from waters of the U.S. and that have or groups, environmental groups, and 3 U.S. EPA, Information Collection Request, Detailed Industry Questionnaires: Phase II Cooling are required to have a National Pollutant other government entities in the Water Intake Structures & Watershed Case Study Discharge Elimination System (NPDES) development, testing, refinement, and Short Questionnaires, Section 3, 1999. permit issued under section 402 of the VerDate 11 CWA. Specifically, the rule applies to existing cooling water intake structure but uses the existing cooling water you if you are the owner or operator of and the design capacity of intake intake structure with no increase in an existing facility that meets all of the structure is not increased; or (4) any design capacity. following criteria: facility constructed in place of such a Thus, in most situations, repowering an • Your facility both generates and facility if the newly constructed facility existing power generating facility would transmits electric power or generates uses an existing cooling water intake be addressed under this proposed rule. electric power but sells it to another structure whose design intake flow is The proposed definition of ‘‘existing entity for transmission; not increased to accommodate the facility’’ is sufficiently broad that it • Your facility is a point source and intake of additional cooling water. covers facilities that will be addressed uses or proposes to use a cooling water The term commence construction is under the Phase III rule (e.g., existing intake structure or structures, or your defined in 40 CFR 122.29(b)(4) and power generating facilities with design facility obtains cooling water by any sort January 17, 2002 is the effective date of flows below the 50 MGD threshold, of contract or arrangement with an the new facility rule. EPA has specified certain existing manufacturing facilities, independent supplier who has a cooling that any modification of a facility that and offshore and coastal oil and gas water intake structure; commenced construction before January extraction facilities). These facilities are • Your facility’s cooling water intake 17, 2002 remains an existing facility for not covered under this proposal because structure(s) withdraw(s) cooling water purposes of this rule to clarify that they do not meet the requirements of from waters of the U.S. and at least significant changes to such a facility proposed § 125.91. twenty-five (25) percent of the water would not, absent other conditions, withdrawn is used solely for contact or cause the facility to be a ‘‘new facility’’ B. What Is a ‘‘Cooling Water Intake non-contact cooling purposes; subject to the Phase I rule. In addition, Structure?’’ • Your facility has an NPDES permit the proposed definition specifies that Today’s proposal would adopt for or is required to obtain one; and any addition of a unit at a facility that Phase II existing facilities the same • Your facility has a design intake commenced construction before January definition of a ‘‘cooling water intake flow of 50 million gallons per day 17, 2002 for purposes of the same structure’’ that is part of the new facility (MGD) or greater; rule, i.e., 40 CFR 125.83, the total • industrial operation as the existing In the case of a cogeneration facility facility would continue to be defined as physical structure and any associated that shares a cooling water intake an existing facility. Further, any constructed waterways used to structure with another facility, only that addition of a unit at a facility that withdraw cooling water from waters of portion of the cooling water flow that is commenced construction before January the U.S. The cooling water intake used in the cogeneration process shall 17, 2002 for purposes of a different structure extends from the point at be considered when determining industrial operation would remain an which water is withdrawn from the whether the 50 MGD and 25 percent existing facility provided the additional surface water source up to, and criteria are met. unit uses an existing cooling water including, the intake pumps. Today’s Facilities subject to the proposed rule intake structure and the design capacity proposal also would adopt the new are referred to as ‘‘Phase II existing of intake structure is not increased. facility rule’s definition of ‘‘cooling facilities.’’ Existing facilities with design Finally, under the proposed definition, water,’’ i.e., water used for contact or flows below the 50 MGD threshold, as any facility constructed in place of a noncontact cooling, including water well as certain existing manufacturing facility that commenced construction used for equipment cooling, evaporative facilities, and offshore and coastal oil before January 17, 2002, would remain cooling tower makeup, and dilution of and gas extraction facilities, would not defined as an existing facility if the effluent heat content. The definition be subject to this proposed rule, but will newly constructed facility uses an specifies that the intended use of be addressed in Phase III. If an existing existing cooling water intake structure cooling water is to absorb waste heat facility that would otherwise be a Phase whose design intake flow is not from production processes or auxiliary II existing facility has or requires an increased to accommodate the intake of operations. The definition also specifies NPDES permit but does not meet the additional cooling water. that water used for both cooling and twenty-five percent cooling water use Under this proposed rule certain non-cooling purposes would not be threshold, it would not be subject to forms of repowering could be considered cooling water for purposes permit conditions based on today’s undertaken by an existing power of determining whether 25% or more of proposed rule; rather, it would be generating facility that uses a cooling the flow is cooling water. subject to permit conditions water intake structure and it would This definition differs from the implementing section 316(b) of the remain subject to regulation as a Phase definition of ‘‘cooling water intake CWA set by the permit director on a II existing facility. For example, the structure’’ that is included in the 1977 case-by-case basis, using best following scenarios would be existing Draft Guidance. The proposed definition professional judgment. facilities under the proposed rule: clarifies that the cooling water intake • An existing power generating structure includes the physical structure A. What Is an ‘‘Existing Facility’’ for facility undergoes a modification of its and technologies that extend up to and Purposes of the Section 316(b) Proposed process short of total replacement of the include the intake pumps. Inclusion of Phase II Rule? process and concurrently increases the the term ‘‘associated constructed EPA is proposing to define the term design capacity of its existing cooling waterways’’ is intended to clarify that ‘‘existing facility’’ as any facility that water intake structures; the definition includes those canals, commenced construction before January • An existing power generating channels, connecting waterways, and 17, 2002 and (1) any modification of facility builds a new process for similar structures that may be built or such a facility; (2) any addition of a unit purposes of the same industrial modified to facilitate the withdrawal of at such a facility for purposes of the operation and concurrently increases cooling water. The explicit inclusion of same industrial operation; (3) any the design capacity of its existing the intake pumps in the definition addition of a unit at such a facility for cooling water intake structures; reflects the key role pumps play in purposes of a different industrial • An existing power generating determining the capacity (i.e., dynamic operation, if the additional unit uses an facility completely rebuilds its process capacity) of the intake. These pumps, VerDate 11 which bring in water, are an essential ‘‘waters of the United States’’ is to be the same, adjacent, or nearby property; component of the cooling water intake made by the permit writer on a case-by- one of these facilities might take in structure since without them the intake case basis, informed by the principles cooling water and then transfer it to could not work as designed. enunciated in Solid Waste Agency of other facilities prior to discharge of the In addition, the definition would Northern Cook County v. US Army cooling water to a water of the U.S. apply to structures that bring water in Corps of Engineers, 531 U.S. 159 (2001). Proposed § 125.91(c) addresses such a for both contact and noncontact cooling Therefore, facilities that withdraw situation. It provides that use of a purposes. This clarification is necessary cooling water from cooling ponds that cooling water intake structure includes because cooling water intake structures are ‘‘waters of the U.S.’’ and that meet obtaining cooling water by any sort of typically bring water into a facility for today’s other proposed criteria for contract or arrangement with an numerous purposes, including coverage (including the requirement independent supplier (or multiple industrial processes; use as circulating that the facility have or be required to suppliers) of cooling water if the water, service water, or evaporative obtain an NPDES permit) would be supplier or suppliers withdraw(s) water cooling tower makeup water; dilution of subject to today’s proposed rule. from waters of the United States. This effluent heat content; equipment provision is intended to prevent D. Is My Facility Covered If It Is a Point cooling; and air conditioning. circumvention of the proposed Source Discharger Subject to an NPDES Finally, at § 125.91(b), consistent with requirements by creating arrangements Permit? the new facility rule, this proposed rule to receive cooling water from an entity provides that use of a cooling water Today’s proposed rule would apply that is not itself a point source intake structure includes obtaining only to facilities that have an NPDES discharger. It is the same as in the final cooling water by any sort of contract or permit or are required to obtain one new facility rule. 40 CFR 125.81(b). arrangement with an independent because they discharge or might Proposed § 125.91(c) also provides, as supplier (or multiple suppliers) of discharge pollutants, including storm in the new facility rule, that facilities cooling water if the supplier or water, from a point source to waters of that obtain cooling water from a public suppliers withdraw(s) water from waters the U.S. This is the same requirement water system or use treated effluent that of the United States. This provision is EPA included in the new facility rule. otherwise would be discharged to a intended to prevent circumvention of 40 CFR 125.81(a)(1). Requirements for water of the U.S. would not be subject these requirements by creating minimizing the adverse environmental to this proposed rule. arrangements to receive cooling water impact of cooling water intake In addition, as EPA stated in the from an entity that is not itself a point structures would continue to be applied preamble to the final new facility rule, source. It also provides that use of through NPDES permits. the Agency would encourage the cooling water does not include Based on the Agency’s review of Director to closely examine scenarios in obtaining cooling water from a public potential Phase II existing facilities that which a potential Phase II existing water system or the use of treated employ cooling water intake structures, facility withdraws significant amounts effluent that otherwise would be the Agency anticipates that most of cooling water but does not have an discharged to a water of the U.S. existing power generating facilities that NPDES permit. As appropriate, the would be subject to this rule will Director should apply other legal C. Is My Facility Covered If It Withdraws control the intake structure that requirements, such as section 404 or 401 From Waters of the U.S.? supplies them with cooling water, and of the Clean Water Act, the Coastal Zone The requirements proposed today discharge some combination of their Management Act, the National would apply to cooling water intake cooling water, wastewater, and storm Environmental Policy Act, or similar structures that withdraw amounts of water to a water of the U.S. through a State authorities to address adverse water greater than the proposed flow point source regulated by an NPDES environmental impact caused by cooling threshold from ‘‘waters of the U.S.’’ permit. In this scenario, the water intake structures at those existing Waters of the U.S. include the broad requirements for the cooling water facilities. range of surface waters that meet the intake structure would be specified in regulatory definition at 40 CFR 122.2, the facility’s NPDES permit. In the event E. Who Is Covered Under the Thresholds which includes lakes, ponds, reservoirs, that a Phase II existing facility’s only Included in This Proposed Rule? nontidal rivers or streams, tidal rivers, NPDES permit is a general permit for This proposed rule applies to estuaries, fjords, oceans, bays, and storm water discharges, the Agency facilities that (1) withdraw cooling coves. These potential sources of anticipates that the Director would write water from water of the U.S. and use at cooling water may be adversely affected an individual NPDES permit containing least twenty-five (25) percent of the by impingement and entrainment. requirements for the facility’s cooling water withdrawn for cooling purposes Some facilities discharge heated water water intake structure. The Agency and (2) have at least one cooling water to cooling ponds, then withdraw water invites comment on this approach for intake structure with a design intake from the ponds for cooling purposes. applying cooling water intake structure capacity of 50 MGD or more. Proposed EPA does not intend this proposal to requirements to the facility. § 125.91. change the regulatory status of cooling Alternatively, requirements applicable EPA is proposing to include a ponds. Cooling ponds are neither to cooling water intake structures could provision, like that specified in the new categorically included nor categorically be incorporated into general permits. facility rule, that facilities that use less excluded from the definition of ‘‘waters The Agency also invites comment on than twenty-five (25) percent of the of the United States’’ at 40 CFR 122.2. this approach. water withdrawn for cooling purposes EPA interprets 40 CFR 122.2 to give The Agency also recognizes that some are not subject to this rule. This permit writers discretion to regulate facilities that have or are required to threshold ensures that nearly all cooling cooling ponds as ‘‘waters of the United have an NPDES permit might not water and the most significant facilities States’’ where cooling ponds meet the directly control the intake structure that using cooling water intake structures are definition of ‘‘waters of the United supplies their facility with cooling addressed by these requirements to States.’’ The determination whether a water. For example, facilities operated minimize adverse environmental impact particular cooling pond is or is not by separate entities might be located on (see 66 FR 65338). Phase II existing VerDate 11 facilities typically use far more than 25 G. What Special Definitions Apply to typically less than 30 parts per thousand percent of the water they withdraw for This Proposal? (by mass). Freshwater river or stream means a cooling. As in the new facility rule, Definitions specific to this proposal lotic (free-flowing) system that does not water used for both cooling and non- are set forth in proposed § 125.93. receive significant inflows of water from cooling purposes would not count Except for the definitions of ‘‘cooling oceans or bays due to tidal action. For towards the 25 percent threshold. water’’ and ‘‘existing facility,’’ which the purposes of this rule, a flow-through are separately defined for Phase II In addition, at § 125.91, EPA is reservoir with a retention time of 7 days facilities in proposed § 125.93, the proposing that this rule would apply to or less will be considered a freshwater definitions in the new facility rule, 40 facilities that have a cooling water river or stream. intake structure with a design intake CFR 125.83, also apply to this proposed Hydraulic zone of influence means capacity of 50 million gallons per day rule. The definitions in the new facility that portion of the source waterbody (MGD) or greater of source water. EPA rule that would apply to Phase II hydraulically affected by the cooling chose the 50 MGD threshold to focus the existing facilities are as follows: water intake structure withdrawal of proposed rule on the largest existing Annual mean flow means the average water. power generating facilities. Existing of daily flows over a calendar year. Impingement means the entrapment power generating facilities with design Historical data (up to 10 years) must be of all life stages of fish and shellfish on flows below this threshold, as well as used where available. the outer part of an intake structure or Closed-cycle recirculating system certain existing manufacturing facilities, against a screening device during means a system designed, using and offshore and coastal oil and gas periods of intake water withdrawal. minimized makeup and blowdown extraction facilities, would not be Lake or reservoir means any inland flows, to withdraw water from a natural body of open water with some subject to this proposed rule but will be or other water source to support contact addressed under the Phase III rule. To minimum surface area free of rooted and/or noncontact cooling uses within a vegetation and with an average clarify that manufacturing and facility. The water is usually sent to a commercial facilities are not subject to hydraulic retention time of more than 7 cooling canal or channel, lake, pond, or days. Lakes or reservoirs might be the Phase II rule as a result of their tower to allow waste heat to be relationship as a host plant to a natural water bodies or impounded dissipated to the atmosphere and then is streams, usually fresh, surrounded by cogeneration facility, only that portion returned to the system. (Some facilities land or by land and a man-made of the cooling water intake flow that is divert the waste heat to other process retainer (e.g., a dam). Lakes or reservoirs used in the cogeneration process would operations.) New source water (make-up might be fed by rivers, streams, springs, be considered in determining whether water) is added to the system to and/or local precipitation. Flow-through the 50 MGD and 25 percent criteria are replenish losses that have occurred due reservoirs with an average hydraulic met. EPA estimates that the 50 MGD to blowdown, drift, and evaporation. retention time of 7 days or less should threshold would subject approximately Cooling water intake structure means be considered a freshwater river or 539 of 942 (57 percent) of existing the total physical structure and any stream. power generating facilities to the associated constructed waterways used Maximize means to increase to the proposal and would address 99.04 to withdraw cooling water from waters greatest amount, extent, or degree percent of the total flow withdrawn by of the U.S. The cooling water intake reasonably possible. existing steam electric power generating structure extends from the point at Minimum ambient source water facilities.4 EPA believes the regulation which water is withdrawn from the surface elevation means the elevation of of existing facilities with flows of 50 surface water source up to, and the 7Q10 flow for freshwater streams or MGD or greater in Phase II will address including, the intake pumps. rivers; the conservation pool level for those existing power generating Design intake flow means the value lakes or reservoirs; or the mean low facilities with the greatest potential to assigned (during the facility’s design) to tidal water level for estuaries or oceans. cause or contribute to adverse the total volume of water withdrawn The 7Q10 flow is the lowest average 7 environmental impact. In addition, EPA from a source waterbody over a specific consecutive day low flow with an has limited data on impacts at facilities time period. average frequency of one in 10 years withdrawing less than 50 MGD. Design intake velocity means the determined hydrologically. The Deferring regulation of such facilities to value assigned (during the design of a conservation pool is the minimum Phase III provides additional cooling water intake structure) to the depth of water needed in a reservoir to opportunity for the Agency to collect average speed at which intake water ensure proper performance of the impingement and entrainment data for passes through the open area of the system relying upon the reservoir. The these smaller facilities. EPA requests intake screen (or other device) against mean low tidal water level is the comment on both the 50 MGD and 25 which organisms might be impinged or average height of the low water over at percent cooling water thresholds. through which they might be entrained. least 19 years. Entrainment means the incorporation Minimize means to reduce to the F. When Must a Phase II Existing of all life stages of fish and shellfish smallest amount, extent, or degree Facility Comply With the Proposed with intake water flow entering and reasonably possible. Requirements? passing through a cooling water intake Natural thermal stratification means structure and into a cooling water the naturally-occurring division of a If your facility is subject to the rule, system. waterbody into horizontal layers of proposed § 125.92 would require that Estuary means a semi-enclosed body differing densities as a result of you must comply when an NPDES of water that has a free connection with variations in temperature at different permit containing requirements open seas and within which the depths. consistent with this subpart is issued to seawater is measurably diluted with New facility means any building, you. fresh water derived from land drainage. structure, facility, or installation that The salinity of an estuary exceeds 0.5 meets the definition of a ‘‘new source’’ 4 Source: Initial SBREFA Analysis, 6/01. parts per thousand (by mass) but is or ‘‘new discharger’’ in 40 CFR 122.2 VerDate 11 and 122.29(b)(1), (2), and (4) and is a This facility would not be considered a compiled by private companies. In those greenfield or stand-alone facility; ‘‘new facility’’ even if routine instances where databases are commences construction after January maintenance or repairs that do not considered confidential, or where raw 17, 2002; and uses either a newly increase the design capacity were data was unavailable for review, EPA constructed cooling water intake performed on the intake structure. did not consider the information. structure, or an existing cooling water Ocean means marine open coastal Summaries of the reviewed data sources intake structure whose design capacity waters with a salinity greater than or are listed below. is increased to accommodate the intake equal to 30 parts per thousand (by 1. Traditional Steam Electric Utilities of additional cooling water. New mass). facilities include only ‘‘greenfield’’ and Source water means the waterbody Federal Energy Regulatory ‘‘stand-alone’’ facilities. A greenfield (waters of the U.S.) from which the Commission Data Sources. The Federal facility is a facility that is constructed at cooling water is withdrawn. Energy Regulatory Commission (FERC) a site at which no other source is Thermocline means the middle layer is an independent agency that oversees located, or that totally replaces the of a thermally stratified lake or America’s natural gas industry, electric process or production equipment at an reservoir. In this layer, there is a rapid utilities, nonfederal hydroelectric existing facility (see 40 CFR decrease in temperatures. projects, and oil pipeline transportation 122.29(b)(1)(i) and (ii)). A stand-alone Tidal excursion means the horizontal system. FERC requires that utilities, facility is a new, separate facility that is distance along the estuary or tidal river companies, or individuals subject to its constructed on property where an that a particle moves during one tidal regulations periodically file data or existing facility is located and whose cycle of ebb and flow. information relating to such matters as processes are substantially independent Tidal river means the most seaward financial operations, energy production of the existing facility at the same site reach of a river or stream where the or supply, and compliance with (see 40 CFR 122.29(b)(1)(iii)). New salinity is typically less than or equal to applicable regulations. Following are facility does not include new units that 0.5 parts per thousand (by mass) at a brief descriptions of the relevant FERC are added to a facility for purposes of time of annual low flow and whose data collection forms associated with the same general industrial operation surface elevation responds to the effects traditional steam electric utilities: • (for example, a new peaking unit at an of coastal lunar tides. FERC Form 1, the Annual Report for Major Electric Utilities, Licensees electrical generating station). III Summary of Data Collection (1) Examples of ‘‘new facilities’’ and Others, collects extensive Activities include, but are not limited to the accounting, financial, and operating following scenarios: (i) A new facility is EPA focused its data collection data from major privately-owned constructed on a site that has never been activities on traditional utilities and electric utilities. A privately-owned used for industrial or commercial nonutility power producers. Based on electric utility is considered ‘‘major’’ if activity. It has a new cooling water the 1982 Census of Manufacturers, these its sales and transmission services, in intake structure for its own use. (ii) A industries account for more than 90 each of the three previous calendar facility is demolished and another percent of cooling water use in the years, exceeded one of the following: (1) facility is constructed in its place. The United States. Traditional utilities and One million megawatt hours of total newly-constructed facility uses the nonutility power producers that use annual sales; (2) 100 megawatt hours of original facility’s cooling water intake cooling water were further limited to annual sales for resale; (3) 500 megawatt structure, but modifies it to increase the those plants that generate electricity by hours of annual power exchanges design capacity to accommodate the means of steam as the thermodynamic delivered; or (4) 500 megawatt hours of intake of additional cooling water. (iii) medium (steam electric) because they annual wheeling for others. Utility-level A facility is constructed on the same are associated with large cooling water information (e.g., number of employees, property as an existing facility, but is a needs. Other power producers generate detailed revenue and expense separate and independent industrial electricity by means other than steam information, balance sheet information, operation. The cooling water intake (e.g., gas turbines) and typically require and electricity generation information) structure used by the original facility is only small amounts of cooling water, if and plant-level information (e.g., modified by constructing a new intake any. production expenses, balance sheet bay for the use of the newly constructed Facilities in the traditional steam information, and electricity generation facility or is otherwise modified to electric utility category are classified information) was used in the economic increase the intake capacity for the new under Standard Industrial Classification analysis of the proposed regulation. EPA facility. (SIC) codes 4911 and 493, while used FERC Form 1 data as compiled and (2) Examples of facilities that would nonutility power producers are distributed by other organizations than NOT be considered a ‘‘new facility’’ classified under the major code that FERC (see below). (Note that FERC Form include, but are not limited to, the corresponds to the primary purpose of 1 applies only to privately-owned following scenarios: (i) A facility in the facility. Nonutility facilities are utilities. Publicly-owned utilities and commercial or industrial operation is classified under SIC codes 4911 and 493 rural electric cooperatives are discussed modified and either continues to use its if the primary purpose of the facility is below.) original cooling water intake structure to generate electricity, and it is these • FERC Form 1–F, the Annual Report or uses a new or modified cooling water nonutility facilities that are potentially of Nonmajor Public Utilities and intake structure. (ii) A facility has an subject to this rule. Licensees, collects accounting, financial, existing intake structure. Another and operating data from nonmajor facility (a separate and independent A. Existing Data Sources privately-owned electric utilities. A industrial operation), is constructed on EPA collected data from multiple privately-owned electric utility is the same property and connects to the sources, both public and proprietary, in considered ‘‘nonmajor’’ if it had total facility’s cooling water intake structure order to compile an accurate profile of annual sales of 10,000 megawatt hours behind the intake pumps, and the the potentially regulated community. or more in the previous calendar year design capacity of the cooling water EPA reviewed information collected by but is not classified as ‘‘major’’ under intake structure has not been increased. other Federal agencies, as well as data the FERC Form 1 definition. FERC Form VerDate 11 1–F collects utility- and plant-level data or sale of electric energy primarily for health and safety, the common defense similar to that on FERC Form 1, albeit use by the public. Data used from Form and security, and the environment in less detailed. EIA–861 included sales and revenue by the use of nuclear materials in the Energy Information Administration consumer class, the utility’s NERC United States. In carrying out its Data Sources. The Energy Information region, and address information. In responsibilities of regulating Administration (EIA) is an independent addition, EPA used data on utility commercial nuclear power reactors, the statistical and analytical agency within ownership to classify each utility as NRC compiles and publishes data and the U.S. Department of Energy (DOE). In either a privately-owned utility, a reports regarding the operation and support of its analytic activities, the EIA publicly-owned utility, or a rural maintenance of commercial nuclear administers a series of data collection electric cooperative. power plants around the country. EPA efforts including extensive surveys of In addition to data from the EIA data collected information from the NRC electric utilities’ financial operations, collection forms outlined above, EPA regarding the configuration of cooling and their production and disposition of used EIA’s database of FERC Form 1 water intake structures to assist in electricity. Following are brief data, containing the majority of utility- estimating the capacities of condenser descriptions of the EIA data collection level financial and operating data flows. forms associated with traditional steam submitted on the FERC Form 1. While Opri Data Sources. Opri is a private electric utilities that EPA has used as these data are directly available from firm located in Boulder, Colorado, that data sources: FERC, the EIA database is published in has compiled extensive databases • Form EIA–412, the Annual Report an electronic format that is more related to the traditional steam electric of Public Electric Utilities, collects convenient to use than the FERC data. utility industry. Opri’s Electric accounting, financial, and operating Because EIA conducts basic quality Generating Plant Database includes data from publicly-owned electric assurance activities, EPA expects that plant-level data for privately-owned utilities. The information collected in the EIA data is more reliable than the utilities, publicly-owned utilities, and Form EIA–412 is similar to, but less FERC data. cooperatives for 1988–1997. While these detailed than data collected from major Rural Utility Service Data Sources. data are available from FERC, EIA, and privately-owned electric utilities in The Rural Utility Service (RUS) is a RUS, these agencies do not make the FERC Form 1. EPA use of Form EIA–412 Federal agency that provides rural information available in an easily data included both utility-level infrastructure assistance in electricity, accessible electronic format. As a information (e.g., number of employees, water and telecommunications. As a consequence, EPA purchased plant- detailed revenue and expense Federal credit agency in the U.S. level data from Opri to support its information, balance sheet information, Department of Agriculture, RUS plays a economic analyses. Because the and electricity generation information) leadership role in financial lending and compilation of data in the Electric and plant-level information (e.g., technical guidance for the rural utilities Generating Plant Database is production expenses, balance sheet industries. Rural utilities that borrow proprietary, EPA has included a information, and electricity generation from RUS are subject to annual summary of the data utilized in its information). reporting requirements administered by analyses in the public record. • Form EIA–767, the Steam-Electric RUS. Following are brief descriptions of Plant Operation and Design Report, the relevant RUS data collection forms 2. Steam Electric Nonutility Power collects data on air and water quality associated with traditional steam Producers from steam-electric power plants with electric utilities: Energy Information Administration generating capacity of 100 megawatts or • RUS Form 12, the Electric Data Sources. Form EIA–867, the greater. A subset of these data are Operating Report, collects accounting, Annual Nonutility Power Producer provided for steam-electric power plants financial, and operating data from rural Report, collects data on electricity with generating capacity between 10 electric cooperatives 7. The information generation, installed capacity, and and 100 megawatts. EPA use of Form collected in RUS Form 12 is similar to energy consumption from nonutility EIA–767 data included unit-level data collected from major privately- power producers that own or plan on information on net electricity owned electric utilities in FERC Form 1. installing electric generation equipment generation, hours in operation, and the EPA use of RUS Form 12 data included with a total capacity of one megawatt or quantity of fuel burned. utility-level information (e.g., number of more. The form does not collect any Form EIA–860, the Annual Electric employees, detailed revenue and economic or financial data. EPA did not Generator Report, collects data on the expense information, balance sheet utilize company-level data from the status of electric generating plants and information, and electricity generation Form EIA–867 because the confidential associated equipment in operation and information), plant-level information nature of this data prevented EIA from those scheduled to be in operation (e.g., production expenses, balance releasing it. EPA did use Form EIA–867 within the next 10 years of filing the sheet information, and electricity to assess the population of potentially report. Each utility that operates or generation information), as well as unit- affected facilities and to identify survey plans to operate a power plant in the level information (e.g., fuel recipients. United States is required to file Form consumption, operating hours, and Utility Data Institute Data Sources. EIA–860. EPA use of Form EIA–860 data electricity generation). The UDI Directory of U.S. Cogeneration, included unit-level information on U.S. Nuclear Regulatory Commission Small Power, and Industrial Power operating status, nameplate capacity, Data Sources. The U.S. Nuclear Plants contains data for more than 4,300 and ownership percentage. Regulatory Commission (NRC) is an nonutility power producer plants. The Form EIA–861, the Annual Electric independent agency established to database, however, is not exclusive to Utility Report, collects data on ensure the protection of the public facilities that have steam electric generation, wholesale purchases, and generators. The database also contains sales and revenue by class of consumer 7 Note that this data collection form only applies nonutility power producers with and State. Respondents include each to rural electric cooperatives. Corresponding data turbines that do not use cooling water collection forms for privately-owned and publicly- electric utility that is engaged in the owned utilities are discussed in other parts of this such as gas turbines, geothermal units, generation, transmission, distribution, section. wind and solar installations, and a VerDate 11 variety of other plant types. The primary The NEWGen database is a Of the 65 in-scope facilities identified focus of the UDI nonutility database is compilation of detailed information on as repowering facilities in the NEWGen on facilities that provide at least some new electric generating capacity database, 24 received the detailed electricity for sale to utilities. EPA used proposed over the next several years. questionnaire, which requested the UDI database to compare the names The database differentiates between information about planned cooling and addresses of steam electric plants proposed capacity at new (greenfield) water intake structures and changes to with those in the Form EIA–867 facilities and additions/modifications to capacity. Nineteen of these 24 facilities database to ensure comprehensive existing facilities. To identify are utilities and the remaining five are coverage of nonutility power producers. repowering facilities of interest, the nonutilities. The Agency analyzed the Edison Electric Institute Data Sources. Agency screened the 1,530 facilities in section 316(b) detailed questionnaire EEI conducts an annual survey and the NEWGen database with respect to data for these 24 facilities to identify presents statistics on nonutility power the following criteria: Facility status, facilities that indicated planned producers in a document entitled, country, and steam electric additions. modifications to their cooling systems Capacity and Generation of Nonutility The Agency then identified 124 which will change the capacity of intake Sources of Energy. However, the data NEWGen facilities as potential water collected for the plant and the are considered confidential and EEI will repowering facilities. estimated cost to comply with today’s only disseminate data in an aggregated Because the NEWGen database proposal. Four such facilities were form. Because EPA must have the raw provides more information on identified, two utilities and two data on a facility-specific basis for this repowering than the section 316(b) nonutilities. Both utilities responded rulemaking, EPA was unable to use this survey, the Agency used it as the that the planned modifications will database. starting point for the analysis of decrease their cooling water intake repowering facilities. Of the 124 capacity and that they do not have any 3. Repowering of Steam Electric Power NEWGen facilities identified as planned cooling water intake structures Generating Facilities (Utility and repowering facilities, 85 responded to that will directly withdraw cooling Nonutility) the section 316(b) survey. Of these 85 water from surface water. The two As discussed in part B of this Section, facilities, 65 are in-scope and 20 are out nonutilities, on the other hand, the section 316(b) Survey acquired of scope of this proposal. For each of the indicated that the planned technological and economic information 65 in scope facilities, the NEWGen modifications will increase their cooling from facilities for the years 1998 and database provided an estimation of the water intake capacity and that they do 1999. With this information, the Agency type and extent of the capacity have planned cooling water intake established a subset of facilities additions. The Agency found that 36 of structures that will directly withdraw potentially subject to this rule. Since the 65 facilities would be combined- cooling water from surface water. 1999, some existing facilities have cycle facilities after the repowering Using the NEWGen and section 316(b) proposed and/or enacted changes to changes. Of these, 34 facilities are detailed questionnaire information on their facilities in the form of repowering projected to decrease their cooling water repowering facilities, the Agency that could potentially affect the intake after repowering (through the examined the extent to which planned applicability of today’s proposal or a conversion from a simple steam cycle to and/or enacted repowering changes facility’s compliance costs. The Agency a combined-cycle plant). The other 31 would effect cooling water withdrawals therefore conducted research into facilities within the scope of the rule and, therefore, the potential costs of repowering facilities for the section would increase their cooling water compliance with this proposal. Because 316(b) existing facility rule and any intake. The Agency examined the the Agency developed a cost estimating information available on proposed characteristics of these facilities methodology that primarily utilizes changes to their cooling water intake projected to undergo repowering and design intake flow as the independent structures. The Agency defines determined the waterbody type from variable, the Agency examined the repowering as existing facilities either which they withdraw cooling water. extent to which compliance costs would undertaking replacement of existing The results of this analysis are change if the repowering data generating capacity or making additions presented in Exhibit 1. summarized above were incorporated to existing capacity. The Agency used into the cost analysis of this rule. The two separate databases to assemble EXHIBIT 1.—IN-SCOPE EXISTING FA- Agency determined that projected available information for the repowering CILITIES PROJECTED TO ENACT compliance costs for facilities facilities: RDI’s NEWGen Database, REPOWERING CHANGES withdrawing from estuaries could be November 2001 version and the Section lower after incorporating the repowering 316(b) Survey. Number of changes. The primary reason for this is Number of plants In January 2000, EPA conducted a plants projected to the fact that the majority of estuary survey of the technological and projected to repowering facilities would change from Waterbody type increase decrease or economic characteristics of 961 steam- cooling maintain a full-steam cycle to a combined-cycle, electric generating plants. Only the cooling thereby maintaining or decreasing their water with- water with- detailed questionnaire, filled out by 283 drawal drawal cooling water withdrawals (note that a utility plants and 50 nonutility plants, combined-cycle facility generally will contains information on planned Ocean ...... N/A N/A withdraw one-third of the cooling water changes to the facilities’ cooling systems Estuary/Tidal of a comparably sized full-steam (Part 2, Section E). Of the respondents River ...... 3 17 facility). Therefore, the portion of to the detailed questionnaire, only six Freshwater compliance costs for regulatory options facilities (three utility plants and three River/Stream 14 10 that included flow reduction nonutility plants) indicated that their Freshwater requirements or technologies would future plans would lead to changes in Lake/Res- significantly decrease if the Agency ervoir ...... 10 1 the operation of their cooling water Great Lake ...... 0 1 incorporated repowering changes into intake structures. the analysis. As shown in Exhibit 1 the VerDate 11 majority of facilities projected to approach provides a sound basis for eligible facilities to receive a detailed increase cooling water withdrawals due assessing best technologies available for questionnaire. The sample included 282 to the repowering changes use minimizing adverse environmental utility facilities and 181 nonutility freshwater sources. In turn, the impacts. facilities. All 191 manufacturing compliance costs for these facilities The screener survey focused on facilities received a detailed would increase if the Agency nonutility and manufacturing facilities. questionnaire. For nonutilities and incorporated repowering for this EPA developed the sample frame (list of utilities, those facilities not selected to proposal. facilities) for the screener questionnaire receive a detailed questionnaire were For the final rule, the Agency intends using public data sources as described sent a Short Technical Questionnaire. to continue its research into repowering in the Information Collection Request EPA’s approach in selecting a sample at existing facilities. The Agency will (DCN 3–3084–R2 in Docket W–00–03). involved the identification of consider the results of its repowering Facilities chosen for the screener population strata, the calculation of research and any comments provided on questionnaire represented a statistical sample sizes based on desired levels of this subject for the final rule. The sample of the entire universe of precision, and the random selection of Agency therefore requests comment on nonutility and manufacturing facilities sites given the sample size calculations planned and enacted repowering potentially subject to cooling water within each stratum. More detail is activities and the above summary of its intake regulations. EPA did not conduct provided in a report, Statistical repowering research to date. The a census of all facilities (i.e. send a Summary for Cooling Water Intakes Agency is especially interested in survey to all facilities) for the screener Structures Surveys (See DCN 3–3077 in information from facilities that have questionnaire because of the burden Docket W–00–03). enacted repowering changes and the associated with surveying a large Five questionnaires were distributed degree to which these changes have number of facilities. Rather, EPA refined to different industrial groups. They changed their design intake flow. the industry data using industry-specific were: (1) Detailed Industry sources to develop sample frames and Questionnaire: Phase II Cooling Water B. Survey Questionnaires mailing lists. EPA believes the sample Intake Structures—Traditional Steam EPA’s industry survey effort consists frame was sufficient to characterize the Electric Utilities, (2) Short Technical of a two-phase process. EPA operations of each industrial category. Industry Questionnaire: Phase II Cooling administered a screener questionnaire EPA sent the screener questionnaire to Water Intake Structures—Traditional focused on nonutility and 2600 facilities identified in the sample Steam Electric Utilities, (3) Detailed manufacturing facilities as the first frame as follows: (1) All identified Industry Questionnaire: Phase II Cooling phase of this data collection process. steam electric nonutility power Water Intake Structures—Steam Electric The screener questionnaire provides producers, both industrial self- Nonutility Power Producers, (4) information on cooling-water intake generators and nonindustrial generators Detailed Industry Questionnaire: Phase capacity, sources of the water, intake (1050 facilities, of which 853 II Cooling Water Intake Structures— structure types, and technologies used responded); (2) and a sample of Manufacturers, (5) Watershed Case to minimize adverse environmental manufacturers that fell under four other Study Short Questionnaire. impacts. It also provides data on facility industrial categories: Paper and allied The questionnaires provided EPA and parent-firm employee numbers and products, chemical and allied products, with technical and financial data revenues. This information was used to petroleum and coal products, and necessary for developing this proposed design a sampling plan for the primary metals (1550 facilities, of which regulation. Specific details about the subsequent detailed questionnaire. 1217 responded). EPA adjusted the questions may be found in EPA’s Following the screener survey, the sample frame for the screener Information Collection Request (DCN 3– Agency sent out and collected either a questionnaire to account for several 3084-R2 in Docket W–00–03) and in the short technical or a detailed categories of non-respondents, questionnaires (see DCN 3–0030 and 3– questionnaire to utility, nonutility, and including facilities with incorrect 0031 in Docket W–00–03 and Docket for manufacturing facilities, as described address information, facilities no longer today’s proposal); these documents are below. The two-phase survey was in operation, and duplicate mailings. also available on EPA’s web site (http:/ designed to collect representative data Through follow-up phone calls and /www.epa.gov/waterscience/316b/ from a sample group of those categories mailings, EPA increased the response question/). of facilities potentially subject to section rate for the screener questionnaire to 95 C. Site Visits 316(b) regulation for use in rule percent. The screener questionnaire was development. not sent to utilities, all of which were From 1993 to the present, EPA has In 1997, EPA estimated that over believed to be identified accurately conducted site visits to numerous power 400,000 facilities could potentially be using the publically-available data generating stations around the country subject to a cooling water intake described above. to observe cooling water intake structure regulation. Given the large number of A sample of manufacturing and design and operations and document facilities potentially subject to nonutility facilities identified as in- examples of different cooling water regulation, EPA decided to focus its data scope (subject to regulation) with the intake structure configurations. EPA has collection efforts on six industrial screener questionnaire, and all utilities visited the plants (each with either a categories that, as a whole, are estimated then were sent either a short technical once-through or closed-cycle, to account for over 99 percent of all or a detailed questionnaire. A total of recirculating cooling system, except as cooling water withdrawals. These six 878 utility facilities, 343 nonutility noted) listed below: sectors are: Utility Steam Electric, facilities and 191 manufacturing • California: Moss Landing Power Plant Nonutility Steam Electric, Chemicals & facilities received one of the two and Pittsburg Power Plant Allied Products, Primary Metals questionnaires (short technical or • Florida: Big Bend Power Station, St. Industries, Petroleum & Coal Products, detailed) during the second phase of the Lucie Plant, Martin Plant, and Riviera and Paper & Allied Products. There are survey. For utilities, nonutilities, and Beach Power Plant about 48,500 facilities in these six other manufacturing facilities, EPA • Illinois: Will County Station and Zion categories. EPA believes that this selected a random sample of these Nuclear Power Station VerDate 11 • Indiana: Clifty Creek Station and biological studies commissioned by nonutilities, the Agency’s best estimate Tanners Creek Plant power generators, over 80 NPDES of the total number is 129. • Maryland: Calvert Cliffs Nuclear decisions and NPDES or SPDES-related Sources of Surface Water. The source Power Plant and Chalk Point documents, over 120 intake technology of surface water withdrawn for cooling Generating Station reports, over 10 databases on the electric is an important factor in determining • Massachusetts: Pilgrim Nuclear Power power industry, and documents from potential environmental impacts. An Station interagency committees such as the estimated 8 nonutility facilities and 15 • Nevada: El Dorado Energy Power Ohio River Valley Water Sanitation utility facilities withdraw all cooling Plant (dry cooling) Commission (ORSANCO). water from an ocean. An estimated 55 • New York: Indian Point Nuclear The record for the new facility rule nonutility facilities and 50 utility Power Plant and Lovett Generating contains nearly 1,000 documents facilities withdraw all cooling water Station (research articles, databases, legal from an estuary or tidal river. An • New Jersey: Salem Generating Station references, memorandums, meeting estimated 50 nonutility facilities and • Ohio: Cardinal Plant, W.H. Zimmer notes, and other documents), consisting 203 utility facilities withdraw all Plant, and W.C. Beckjord Station of approximately 47,000 pages of cooling water from a freshwater stream • Wisconsin: Valley Power Plant and supporting material available for public or river. An estimated 12 or 13 Pleasant Prairie Power Plant review. The record for this proposed nonutility facilities and 136 utility rule contains over 40 additional facilities withdraw all cooling water D. Data Provided to EPA by Industrial, documents. from a lake or reservoir, including 15 Trade, Consulting, Scientific or For a more complete list of reference utilities on the Great Lakes. Fewer than Environmental Organizations or by the and technical documents, see the record 20 plants withdraw cooling water from General Public for this proposed rule. a combination of these sources. Average Daily Cooling Water Intake in 1. Public Participation IV. Overview of Facility Characteristics 1998. Of the estimated 129 nonutility (Cooling Water Systems & Intakes) for EPA has worked extensively with plants that are potentially subject to this Industries Potentially Subject to stakeholders from industry, public proposed rule, EPA estimates that in Proposed Rule interest groups, state agencies, and other 1998, 4 plants had an average intake of Federal agencies in the development of As discussed above, today’s proposed not more than 10 million gallons per this proposed rule. These public rule would apply to Phase II existing day (MGD), 12 had an average intake participation activities have focused on facilities, which include any existing more than 10 MGD and not over 50 various section 316(b) issues, including facility that both generates and MGD, 20 had an average intake more general issues, as well as issues relevant transmits electric power, or generates than 50 MGD but not over 100 MGD, to development of the Phase I rule and electric power but sells it to another and 90 had an average intake over 100 issues relevant to the proposed Phase II entity existing for transmission and that MGD (three had zero or unreported rule. See section I.C.5 of this preamble meets the other applicability criteria in intake). Note that coverage under the for a discussion of key public § 125.91: (1) They are a point source that rule is based on design intake, not participation activities. uses or proposes to use a cooling water average intake flow. Of the 420 utility intake structure; (2) they have at least 2. Data and Documents Collected by plants that are potentially subject to this one cooling water intake structure that EPA proposed rule, EPA found that in 1998, uses at least 25 percent of the water it 8 plants had an average intake of not Since 1993, EPA has developed withdraws for cooling purposes; (3) they more than 10 million gallons per day cooling water regulations as part of a have a design intake flow of 50 million (MGD), 59 had an average intake more collaborative effort with industry and gallons per day (MGD) or greater; and than 10 MGD and not over 50 MGD, 58 environmental stakeholders, other (4) they have an NPDES permit or are had an average intake more than 50 Federal agencies, the academic and required to obtain one. Today’s rule MGD but not over 100 MGD, and 288 scientific communities as well as the does not apply to facilities whose had an average intake over 100 MGD general public. As such, EPA has primary business activity is not power (seven had zero or unreported intake). reviewed and considered the many generation, such as manufacturing Cooling Water Systems. Facilities may documents, demonstration studies, facilities that produce electricity by co- have more than one cooling water scientific analyses and historical generation. system. Therefore, in providing the perspectives offered in support of each Based on data collected from the information on cooling water systems, a phase of the regulatory process. For Short Technical Industry Questionnaire plant may be counted multiple times (as example, during the early stages of data and Detailed Questionnaire, and many times as it has distinct cooling gathering EPA created an internal compliance requirements in today’s water systems). Thus, of the plants that library of reference documents proposed rule, EPA has identified 539 are potentially subject to this proposed addressing cooling water intake facilities to which today’s rule will rule, the 129 nonutility plants are structure issues. This library currently apply, and estimates that the total counted 165 times; the 420 utility plants holds over 2,800 documents, many of number could be 549. The Agency has are counted 599 times. As a which were referenced in the identified 420 plants owned by utilities consequence, the percentages reported rulemaking process and are contained in that are potentially subject to proposed sum to more than 100 percent. Among the record (see below for further rule. The Agency estimates that 129 nonutility plants, 110 plants (85 information on the record). The library nonutilities may potentially be subject percent) use once-through cooling contains a thorough collection of a wide to the proposed rule. This number, systems, 16 plants (12 percent) use variety of documents, including over 80 however, is subject to some uncertainty. closed-cycle, recirculating cooling 316(b) demonstration documents, over The Agency has identified 119 plants systems, and an estimated 6 plants (5 300 impingement and entrainment owned by nonutilities that are percent) use another type of system. Of studies, over 100 population modeling potentially subject to the proposed rule, the estimated 599 utility plants, 314 studies, over 500 fish biology and stock and after taking into account a small plants (75 percent) use once-through assessment documents, over 350 non-response rate to the survey among cooling systems, 65 plants (15 percent) VerDate 11 use closed-cycle, recirculating cooling from waters of the U.S.8 The withdrawal physical impacts in the pumps and systems, and 49 plants (12 percent) use of such large quantities of cooling water condenser tubing, pressure changes another type of system. affects large quantities of aquatic caused by diversion of the cooling water Cooling Water Intake Structure organisms annually, including into the plant or by the hydraulic effects Configurations. Facilities may have phytoplankton (tiny, free-floating of the condensers, sheer stress, thermal more than one cooling water intake photosynthetic organisms suspended in shock in the condenser and discharge structure configuration. Therefore, in the water column), zooplankton (small tunnel, and chemical toxemia induced by antifouling agents such as chlorine. providing the information on cooling aquatic animals, including fish eggs and larvae, that consume phytoplankton and The mortality rate of entrained water systems, a plant may be counted other zooplankton), fish, crustaceans, organisms varies by species; mortality multiple times (as many times as it has shellfish, and many other forms of rates for fish can vary from 2 to 97 distinct cooling water intake structure aquatic life. Aquatic organisms drawn percent depending on the species and configurations). Thus, of the plants that into cooling water intake structures are life stage entrained.12, 13 Naked goby are potentially subject to this proposed either impinged on components of the larvae demonstrated mortality rates as rule, the 129 nonutility plants are cooling water intake structure or low as 2 percent whereas bay anchovy counted 194 times and the 420 utility entrained in the cooling water system larvae mortality rates were as high as 97 plants are counted 690 times. As a itself. percent.14 Macroinvertebrate mortality consequence, the percentages reported Impingement takes place when ranged from 0 to 84 percent for several sum to more than 100 percent. Of the organisms are trapped against intake species evaluated, but rates were estimated 129 nonutility plants that are screens by the force of the water passing usually less than 29 percent.15, 16 potentially subject to this proposed rule, through the cooling water intake In addition to impingement and 30 (23 percent) withdraw cooling water structure. Impingement can result in entrainment losses associated with the through a canal or channel, 13 (10 starvation and exhaustion (organisms operation of the cooling water intake percent) have an intake structure are trapped against an intake screen or structure, EPA is concerned about the situated in a natural or constructed bay other barrier at the entrance to the cumulative overall degradation of the or cove, 96 (74 percent) have an intake cooling water intake structure), aquatic environment as a consequence structure (surface or submerged) that is asphyxiation (organisms are pressed of (1) multiple intake structures flush with the shoreline, and 16 (12 against an intake screen or other barrier operating in the same watershed or in percent) have a submerged offshore at the entrance to the cooling water the same or nearby reaches and (2) intake structure. Of the 420 utility intake structure by velocity forces that intakes located within or adjacent to an plants that are potentially subject to this prevent proper gill movement, or impaired waterbody. Historically, proposed rule, 142 (34 percent) organisms are removed from the water impacts related to cooling water intake withdraw cooling water through a canal for prolonged periods of time), and structures have been evaluated on a or channel, 41 (10 percent) have an descaling (fish lose scales when facility-by-facility basis. The potential intake situated in a bay or cove, 251 (60 removed from an intake screen by a cumulative effects of multiple intakes percent) have a shoreline intake, 59 (14 wash system) as well as other physical located within a specific waterbody or percent) have a submerged offshore harms. along a coastal segment were not intake, and 6 (1 percent) have another Entrainment occurs when organisms typically assessed and thus are largely type of configuration or reported no are drawn through the cooling water unknown. (One relevant example is information. intake structure into the cooling system. provided for the Hudson River; see V. Environmental Impacts Associated Organisms that become entrained are discussion below. Also see recently With Cooling Water Intake Structures normally relatively small benthic,9 completed case studies for the Delaware planktonic,10 and nektonic 11 organisms, Estuary and Ohio River in the Case The majority of environmental including early life stages of fish and Study Document). There is concern, impacts associated with intake shellfish. Many of these small organisms however, about the effects of multiple structures are caused by water serve as prey for larger organisms that intakes on fishery stocks. As an withdrawals that ultimately result in are found higher on the food chain. As example, the Atlantic States Marine aquatic organism losses. This section entrained organisms pass through a Fisheries Commission has been describes the general nature of these plant’s cooling system they are subject requested by its member States to biological impacts; discusses specific to mechanical, thermal, and/or toxic investigate the cumulative impacts on types of impacts that are of concern to stress. Sources of such stress include commercial fishery stocks, particularly the Agency; and presents examples of overutilized stocks, attributable to documented impacts from a broad range 8 EPA 2000. Detailed Industry Questionnaire: of facilities. EPA believes that in light of Phase II Cooling Water Intake Structures. U.S. 12 Mayhew, D.A., L.D. Jensen, D.F. Hanson, and the national scope of today’s proposed Environmental Protection Agency, Office of P.H. Muessig. 2000. A comparative review of Wastewater Management, Washington, DC. OMB entrainment survival studies at power plants in rule, it is important to present the Control No. 2040–0213. estuarine environments. Environmental Science variety of impacts observed for facilities 9 Refers to bottom dwellers that are generally and Policy 3:S295–S301. located on different waterbody types, small and sessile (attached) such as mussels and 13 EPRI. 2000. Review of entrainment survival under high and low flow withdrawal anemones, but can include certain large motile (able studies: 1970–2000. Prepared by EA Engineering to move) species such as crabs and shrimp. These Science and Technology for the Electric Power regimes, and operating with and species can be important members of the food Research Institute, Palo Alto, CA. without technologies designed to reduce chain. 14 Ibid. environmental impacts. 10 Refers to free-floating microscopic plants and 15 Mayhew, D.A., L.D. Jensen, D.F. Hanson, and animals, including the egg and larval stages of fish P.H. Muessig. 2000. A comparative review of Based on preliminary estimates from and invertebrates that have limited swimming entrainment survival studies at power plants in the questionnaire sent to more than abilities. Plankton are also an important source of estuarine environments. Environmental Science 1,200 existing power plants and food for other aquatic organisms and an essential and Policy 3:S295–S301. factories, industrial facilities in the component of the food chain in aquatic ecosystems. 16 EPRI. 2000. Review of entrainment survival 11 Refers to free-swimming organisms (e.g., fish, studies: 1970–2000. Prepared by EA Engineering United States withdraw more than 279 turtles, marine mammals) that move actively Science and Technology for the Electric Power billion gallons of cooling water a day through the water column and against currents. Research Institute, Palo Alto, CA. VerDate 11 cooling water intakes located in coastal The nature and extent of the turtles found within nearshore waters regions of the Atlantic.17 Specifically, ecosystem-level effect depends on the are thought to be part of the reason for the study will focus on revising existing characteristics of the aquatic organism the rising numbers of turtles entering fishery management models so that they and its interactions with other members facility waters. In response to this accurately consider and account for fish of the ecosystem. Some species, known increase, Florida Power and Light Co. losses from multiple intake structures. as ‘‘keystone species,’’ have a larger proposed installation of nets with Further, the Agency believes that impact on ecosystem structure and smaller size mesh (5-inch square mesh cooling water intakes potentially function than other species. Examples of rather than 8-inch square mesh) at the contribute additional stress to waters keystone species from cooling water St. Lucie facility to minimize already showing aquatic life impairment intake structure-impacted water bodies entrapment.23 from other sources such as industrial include menhaden, Pacific salmon, and Finally, EPA is concerned about discharges and urban stormwater. EPA Eastern oysters. environmental impacts associated with notes that the top four leading causes of As discussed above, structural re-siting or modification of existing waterbody impairment (siltation, changes at the ecosystem level are cooling water intake structures. Three nutrients, bacteria, and metals) affect influenced by a large number of forces main factors contribute to the the aquatic life uses of a waterbody. at work within the ecosystem. Because environmental impacts: Displacement of Thus, the Agency is concerned that of the large number of these forces and biota and habitat resulting from the many of the aquatic organisms subject to the complexity of their interactions, physical siting or modification of a the effects of cooling water withdrawals ecologists can find it difficult to cooling water intake structure in an reside in impaired waterbodies and are determine the contribution of any one aquatic environment, increased levels of therefore potentially more vulnerable to stressor to a structural change in an turbidity in the aquatic environment, cumulative impacts from an array of ecosystem. Much work remains to be and effects on biota and habitat physical and chemical anthropogenic done to determine the extent to which associated with aquatic disposal of stressors. cooling water intake structures induce materials excavated during re-siting or When enough individual aquatic structural change in their host modification activities. Existing organisms are subject to lethal or ecosystems through impingement and programs, such as the CWA section 404 function-impairing stressors, whether entrainment of aquatic organisms. program, National Environmental Policy from cooling water intake structures or Nevertheless, EPA believes that many Act (NEPA) program, and programs water pollutants, the structure of their cooling water intake structures clearly under State/Tribal law, include ecosystem can change significantly in have a significant negative impact on requirements that address many of the response. Changes in ecosystem aquatic organisms at the individual environmental impact concerns structure can then affect all organisms level. The studies discussed below associated with the intake modifications within the ecosystem, including those suggest that these individual-level (see Section X for applicable Federal organisms a cooling water intake impacts can lead to negative impacts at statutes). structure does not directly impact. higher organizational levels. A. Facility Examples Decreased numbers of aquatic In addition to ecosystem-level organisms can have any or several of the impacts, EPA is concerned about the The following discussion provides a following ecosystem-level effects: (1) potential impacts of cooling water number of examples of impingement 18 Disruption of food webs, (2) intake structures located in or near and entrainment impacts that can be disruption of nutrient, carbon, and habitat areas that support threatened, associated with existing facilities. It is energy transfers among the physical and endangered, or other protected species. important to note that these examples 19 biological ecosystem compartments, Although limited information is are meant to illustrate the range of 20 (3) alteration of overall aquatic habitat, available on locations of threatened or impacts that can occur nationally at and (4) alteration of species composition facilities sited at diverse geographic 21 endangered species that are vulnerable and overall levels of biodiversity. to impingement or entrainment, such locations, differing waterbody types, impacts do occur. For example, EPA is and with a variety of control 17 Personal communication, D. Hart (EPA) and L. aware that from 1976 to 1994, technologies in place. In some cases, the Kline (ASMFC), 2001. number of organisms impinged and 18 approximately 3,200 threatened or Food webs are modified by cooling water entrained by a facility can be substantial intake structure impacts because (1) some species endangered sea turtles entered enclosed and in other examples impingement and within the ecosystem suffer heavier mortality cooling water intake canals at the St. entrainment may be minimal due to impacts than others, and (2) cooling water intake Lucie Nuclear Generating Plant in structures convert living organisms to various forms historical impacts from anthropogenic Florida.22 The plant developed a of organic matter, thereby removing food resources activities such as stream or river from consumers of living organisms, and increasing capture-and-release program in response channelization. EPA notes that these food resources for scavengers and decomposers. to these events. Most of the entrapped 19 examples are not representative of all Cooling water intake structures can transfer turtles were captured and released alive; large amounts of nutrients, carbon, and energy from sites whose facilities use cooling water however, approximately 160 turtles did living organisms (in some cases highly mobile or intake structures and that these migratory organisms) to the physical environment. not survive. More recently, the number examples may not always reflect Nutrients, carbon, and energy may re-enter the of sea turtles being drawn into the subsequent action that may have been biological compartment, but they will do so via intake canal increased to approximately different pathways than those used prior to cooling taken to address these impacts on a site- 600 per year. Elevated numbers of sea water intake structures operation (see alteration of specific basis. (Facility reports food webs). documenting the efficacy of more 20 In addition to altering the physical nature of sensitive species may be at greater risk. New species aquatic habitat directly (e.g., current modification (including invasive species), may establish recently installed control technologies and water withdrawal), cooling water intake themselves within the disrupted area if they are are not always available to the Agency.) structure may modify habitat by reducing numbers able to withstand cooling water intake structure With this background, EPA provides the of habitat-modifying organisms (e.g., Pacific impacts. following examples, illustrating that the salmon). 22 Florida Power and Light Company. 1995. 21 Species may disappear from a site in response Assessment of the impacts at the St. Lucie Nuclear impacts attributable to impingement to cooling water intake structure impacts. Generating Plant on sea turtle species found in the Threatened and endangered or otherwise rare or inshore waters of Florida. 23 Ibid. VerDate 11 and entrainment at individual facilities making them more vulnerable to human Case Study Document and the benefits may result in appreciable losses of early impact and potential collapse. discussion in Section IX of this notice. life stages of fish and shellfish (e.g., Further, studies of entrainment at five Brayton Point Generating Station. The three to four billion individuals Hudson River power plants during the Brayton Point Generating Station is annually 24), serious reductions in 1980s predicted year-class reductions located on Mt. Hope Bay, in Somerset, forage species and recreational and ranging from six percent to 79 percent, Massachusetts, within the northeastern commercial landings (e.g., 23 tons lost depending on the fish species.30 An reach of Narragansett Bay. Because of per year 25), and extensive losses over updated analysis completed in 2000 of problems with electric arcing caused by salt drift from an open spray pod design relatively short intervals of time (e.g., entrainment at three of these power located near transmission wires, and one million fish lost during a three- plants predicted year-class reductions of lack of fresh water to replace the salt week study period).26 up to 20 percent for striped bass, 25 percent for bay anchovy, and 43 percent water used for the closed-cycle In addition, some studies estimating for Atlantic tom cod, even without recirculating spray pod cooling water the impact of impingement and assuming 100 percent mortality of system, the company converted Unit 4 entrainment on populations of key entrained organisms.31 The New York from a closed-cycle, recirculating commercial or recreational fish have Department of Environmental system to a once-through cooling water predicted substantial declines in Conservation concluded that these system in July 1984. The modification of population size. This has led to reductions in year-class strength were Unit 4 resulted in a 41 percent increase concerns that some populations may be ‘‘wholly unacceptable’’ and that any in coolant flow, amounting to a altered beyond recovery. For example, a ‘‘compensatory responses to this level of maximum average intake flow of modeling effort evaluating the impact of power plant mortality could seriously approximately 1.3 billion gallons per entrainment mortality on a deplete any resilience or compensatory day and increased thermal discharge to 34 representative fish species in the Cape capacity of the species needed to the bay. An analysis of fisheries data Fear estuarine system predicted a 15 to survive unfavorable environmental by the Rhode Island Division of Fish 35 percent reduction in the species conditions.’’ 32 and Wildlife using a time series- intervention model showed an 87 population.27 More recent modeling In contrast, facilities sited on percent reduction in finfish abundance studies of Mount Hope Bay, waterbodies previously impaired by in Mt. Hope Bay coincident with the anthropogenic activities such as Massachusetts, predicted 87 percent Unit 4 modification.35 The analysis also channelization may demonstrate limited reductions in overall finfish abundance indicated that, in contrast, finfish entrainment and impingement losses. (see Brayton Point Generating Station abundance trends have been relatively The Neal Generating Complex facility, discussion below for additional detail.) stable in adjacent coastal areas and located near Sioux City, Iowa, on the EPA acknowledges that existing fishery portions of Narragansett Bay that are not 28 Missouri River is coal-fired and utilizes resource baselines may be inaccurate. influenced by the operation of Brayton once-through cooling systems. Further, according to one article, Point station. Thus, overall finfish According to a ten-year study conducted ‘‘[e]ven seemingly gloomy estimates of biomass and finfish species diversity from 1972–82, the Missouri River the global percentage of fish stocks that declined in Mount Hope Bay but not in aquatic environment near the Neal are overfished are almost certainly far Narragansett Bay. There appear to be complex was previously heavily too low.’’ 29 Thus, EPA is concerned that multiple, interacting factors that impacted by channelization and very historical overfishing may have influence these declines including high flow rates meant to enhance barge increased the sensitivity of aquatic overfishing and climate change as well traffic and navigation.33 These ecosystems to subsequent disturbance, as temperature increases from thermal anthropogenic changes to the natural discharges and impingement and river system resulted in significant 24 entrainment losses associated with the EPA Region IV. 1979. Brunswick Nuclear losses of habitat necessary for spawning, Steam Electric Generating Plant of Carolina Power Brayton Point facility. and Light Company, historical summary and review nursery, and feeding. At this facility, San Onofre Nuclear Generating of section 316(b) issues. fish impingement and entrainment by Station. The San Onofre Nuclear 25 EPA Region IV. 1986. Findings and cooling water intakes were found to be Generating Station (SONGS) is located determination under 33 U.S.C. 1326, In the Matter minimal. of Florida Power Corporation Crystal River Power on the coastline of the Southern Plant Units 1, 2, and 3, NPDES permit no. The following are summaries of other, California Bight, approximately 2.5 FL0000159. documented examples of impacts miles southeast of San Clemente, 26 Thurber, N.J. and D.J. Jude. 1985. Impingement occurring at existing facilities sited on a California.36 The marine portions of losses at the D.C. Cook Nuclear Power Plant during range of waterbody types. Also, see the 1975–1982 with a discussion of factors responsible Units 2 and 3, which are once-through, and possible impact on local populations. Special open-cycle cooling systems, began report no. 115 of the Great Lakes Research Division, 30 Boreman J. and P. Goodyear. 1988. Estimates of commercial operation in August 1983 Great Lakes and Marine Waters Center, University entrainment mortality for striped bass and other 37 of Michigan. fish species inhabiting the Hudson River Estuary. and April 1984, respectively. Since 27 EPA Region IV. 1979. Brunswick Nuclear American Fisheries Society Monograph 4:152–160. Steam Electric Generating Plant of Carolina Power 31 Consolidated Edison Company of New York. 34 Metcalf & Eddy. 1992. Brayton Point station and Light Company, historical summary and review 2000. Draft environmental impact statement for the monitoring program technical review. Prepared for of section 316(b) issues. state pollutant discharge elimination system USEPA. 28 Watson, R. and D. Pauly. 2001. Systematic permits for Bowline Point, Indian Point 2 & 3, and 35 Gibson, M. 1995 (revised 1996). Comparison of distortions in world fisheries catch trends. Nature Roseton steam electric generating stations. trends in the finfish assemblages of Mt. Hope Bay 414–534–536. 32 New York Department of Environmental and Narragansett Bay in relation to operations of the 29 Jackson J.B.C., M.X. Kirby, W.H. Berger, K.A. Conservation (NYDEC). 2000. Internal New England Power Brayton Point station. Rhode Bjorndal, L.W. Botsford, B.J. Bourque, R.H. memorandum provided to the USEPA on NYDEC’s Island Division of Fish and Wildlife, Marine Bradbury, R. Cooke, J. Erlandson, J.A. Estes, T.P. position on SPDES permit renewals for Roseton, Fisheries Office. Hughes, S. Kidwell, C.B. Lange, H.S. Lenihan, J.M. Bowline Point 1 & 2, and Indian Point 2 & 3 36 Southern California Edison. 1988. Report on Pandolfi, C.H. Peterson, R.S. Steneck, M.J. Tegner, generating stations. 1987 data: marine environmental analysis and and R.R. Warner, 2001. Historical overfishing and 33 Morningside College. 1982. Missouri River interpretation, San Onofre Nuclear Generating the recent collapse of coastal ecosystems. Science aquatic ecology studies. Prepared for Iowa Public Station. 293(5530): 629–638. Service Company, Sioux City, Iowa. 37 Ibid. VerDate 11 then, many studies evaluated the impact million to $83.2 million per year (all in Impingement and entrainment rates are of the SONGS facility on the marine $2001). expressed as numbers of age 1 environment. Lovett Generating Station. The Lovett equivalents, calculated by EPA from the In a normal (non-El Nin˜ o) year, an Generating Station is located in impingement and entrainment data estimated 121 tons of midwater fish Tompkins Cove, New York, on the provided in facility monitoring (primarily northern anchovy, queenfish, western shore of the Hudson River. As reports.45 and white croaker) may be entrained at a method of reducing ichthyoplankton • The Pilgrim Nuclear Power SONGS.38 The fish lost include (free floating fish eggs and larvae) Station, located on Cape Cod Bay, approximately 350,000 juveniles of entrainment at the Lovett station, the Massachusetts, has an intake flow of 446 white croaker, a popular sport fish; this Gunderboom Marine Life Exclusion MGD.46 The average annual number of number represents 33,000 adult System was installed in 1995 at the Unit age 1 equivalents impinged at Pilgrim individuals or 3.5 tons of adult fish. 3 intake structure. Gunderboom is a from 1974–1999 was 52,800 fish. The Within 3 kilometers of SONGS, the woven mesh material initially designed average annual number entrained was density of queenfish and white croaker to prevent waterborne pollutants from 14.4 million fish. in shallow-water samples decreased by entering shoreline environments during • The Miami Fort Power Plant, 34 and 36 percent, respectively. construction or dredging activities. located on the Ohio River about 20 Queenfish declined by 50 to 70 percent Since its initial installation, the miles downstream of Cincinnati, has an in deepwater samples.39 In contrast, Gunderboom system has undergone a intake flow of about 98.7 MGD 47 and relative abundances of bottom-dwelling series of tests and modifications to combined average impingement and adult queenfish and white croaker resolve problems with fabric clogging, entrainment of about 1.8 million age 1 increased in the vicinity of SONGS.40 anchoring, and the boom system. Data equivalent fish per year (298,027 Increased numbers of these and other from testing in 1998 demonstrated that impinged and 1,519,679 entrained). bottom-dwelling species were believed with the Gunderboom system in place, • The JR Whiting Plant, located in to be related to the enriching nature of entrainment of eggs, larvae, and Michigan on Lake Erie has an intake SONGS discharges, which in turn juveniles was reduced by 80 percent.43 flow of 308 MGD.48 The average annual support elevated numbers of prey items Ohio River. EPA evaluated number of age 1 equivalent fish for bottom fish.41 entrainment and impingement impacts entrained was 1.8 million. Before Pittsburg and Contra Costa Power at nine in-scope facilities along a 500- installation of a deterrent net in 1980 to Plants. The Pittsburg and Contra Costa mile stretch of the Ohio River as one of reduce impingement, some 21.5 million Power Plants are located in the San its case studies. Results from these nine age 1 equivalents were lost to Francisco Bay-Delta Estuary, California. facilities were extrapolated to 20 impingement at the facility each year. Several local fish species (e.g., Delta additional in-scope facilities. All in- These losses were reduced by nearly 90 smelt, Sacramento splittail, chinook scope facilities spanned a stretch of the percent with application of the deterrent salmon, and steelhead) found in the Ohio River that extended from the net.49 vicinity of the facilities are now western portion of Pennsylvania, along Studies like those described in this considered threatened or endangered by the southern border of Ohio, and into section may provide only a partial Sate and/or Federal authorities. EPA eastern Indiana. Impingement losses for picture of the severity of environmental evaluated facility data on impingement all in-scope facilities were impact associated with cooling water and entrainment rates for these species approximately 11.3 million fish (age 1 intake structures. Most important, the and estimated that potential losses of equivalents) annually; entrainment methods for evaluating adverse special status fish species at the two losses totaled approximately 23.0 environmental impact used in the 1970s facilities may reach 145,003 age 1 million fish (age 1 equivalents) and 1980s, when most section 316(b) equivalents per year resulting from annually.44 EPA believes that the results evaluations were performed, were often impingement and 269,334 age 1 from this case study may not be inconsistent and incomplete, making equivalents per year due to representative of entrainment and detection and consideration of all entrainment 42 Based on restoration impingement losses along major U.S. impacts difficult in some cases, and costs for these species, EPA estimates rivers because they are based on limited making cross-facility comparison that the value of the potential data collected nearly 25 years ago. In difficult for developing a national rule. impingement losses of these species is addition, due to improvements in water For example, some studies reported $12.8 to 43.2 million per year and the quality and implementation of fishery only gross fish losses; others reported value of potential entrainment is $25.6 management plans, fish populations fish losses on the basis of species and near these facilities may have increased life stage; still others reported percent 38 Swarbrick, S. and R.F. Ambrose. 1989. and therefore these results may losses of the associated population or Technical report C: entrapment of juvenile and underestimate current entrainment and subpopulation (e.g., young-of-year fish). adult fish at SONGS. Prepared for Marine Review impingement at Ohio River facilities. Recent advances in environmental Committee. Power Plants with Flows Less Than 39 Kastendiek, J. and K. Parker. 1988. Interim assessment techniques provide new and technical report: midwater and benthic fish. 500 MGD. The following results from in some cases better tools for monitoring Prepared for Marine Review Committee. the case studies conducted by EPA impingement and entrainment and 40 Swarbrick, S. and R.F. Ambrose. 1989. under this rulemaking effort provide an detecting impacts associated with the Technical report C: entrapment of juvenile and indication of impingement and adult fish at SONGS. Prepared for Marine Review entrainment rates for facilities with 45 Committee. Ibid. 41 Kastendiek, J. and K. Parker. 1988. Interim lower flows than the previous examples. 46 U.S. Department of Energy. 1999. Form EIA– technical report: midwater and benthic fish. 767 (1999). Steam-electric plant operation and Prepared for Marine Review Committee. 43 Lawler, Matusky & Skelly Engineers. 1998. design report. Edison Electric Institute. 42 Impingement and entrainment data were Lovett Generating Station Gunderboom system 47 Ibid. obtained from the 2000 Draft Habitat Conservation evaluation program 1998. 48 Ibid. Plan for the Pittsburg and Contra Costa facilities. 44 Please see EPA’s Case Study Document for 49 Consumers Power Company. 1984, 1988, and Please see EPA’s Case Study Document for detailed more detailed information on these facilities and 1992 reports of deterrent net performance, J.R. information on EPA’s evaluation of impingement the data and methods used by EPA to calculate age Whiting Plant. Prepared for the Michigan Water and entrainment at these facilities. 1 equivalent losses. Resources Commission. VerDate 11 operation of cooling water intake proposed rule or to a site-specific and nursery areas for the vast majority structures.50 51 determination of the benefits of meeting of commercial and recreational the presumptive performance important species of shell and fin fish, VI. Best Technology Available for requirements. If the facility’s costs are including many species that are subject Minimizing Adverse Environmental significantly greater than EPA’s to intensive fishing pressures. Impact at Phase II Existing Facilities estimated costs or site-specific benefits, Therefore, these areas require a higher A. What Is the Best Technology the facility would qualify for a site- level of control that includes both Available for Minimizing Adverse specific determination of best impingement and entrainment controls. Environmental Impact at Phase II technology available. Organisms entrained may include small Existing Facilities? The Agency discusses each of these species of fish and immature life stages three methods for compliance and the (eggs and larvae) of many species that 1. How Will Requirements Reflecting proposed presumptive minimum lack sufficient mobility to move away Best Technology Available for performance requirements in greater from the area of the intake structure. Minimizing Adverse Environmental detail below. EPA invites comments on The reproductive strategies of many Impact Be Established for My Phase II all aspects of this proposed regulatory estuarine species include pelagic or Existing Facility? framework as well as the alternative planktonic larvae, which are very Today’s proposed rule would regulatory approaches discussed later in susceptible to entrainment. establish national minimum this section. EPA discussed these concepts in a performance requirements for the Notice of Data Availability (NODA) for a. What Are the Performance Standards location, design, construction, and the new facility rule (66 FR 28853, May for the Location, Design, Construction, capacity of cooling water intake 25, 2001) and invited comment on a and Capacity of Cooling Water Intake structures at Phase II existing facilities. number of documents which may Structures To Reflect Best Technology These requirements would represent support a judgment that the Available for Minimizing Adverse best technology available for reproductive strategies of tidal river and Environmental Impact? minimizing adverse environmental estuarine species, together with other impact based on the type of waterbody EPA is proposing four performance physical and biological characteristics in which the intake structure is located, standards at § 125.94(b), all of which of those waters, which make them more the volume of water withdrawn by a reflect best technology available for susceptible than other waterbodies to facility, and the facility’s capacity minimizing adverse environmental impacts from cooling water intake utilization rate. Under this proposal, impact from cooling water intake structures. In addition to these EPA would set technology-based structures. Under proposed documents, the NODA presented performance requirements, but the § 125.94(b)(1), any owner or operator information regarding the low Agency would not mandate the use of able to demonstrate that a facility entrainment susceptibility of non-tidal any specific technology. employs technology that reduces intake freshwater rivers and streams to cooling A facility may use one of three capacity to a level commensurate with water intake structure impacts. This different methods for establishing the the use of a closed-cycle, recirculating information also may be relevant in best technology available for cooling system would meet the determining whether tidal rivers and minimizing adverse environmental performance requirements proposed in estuaries are more sensitive to cooling impact. Under the first method, a today’s rule. Use of this type of water intake structures than some parts facility would demonstrate to the technology satisfies both impingement of other waterbodies. Director issuing the permit that the and entrainment performance In general, commenters on the NODA facility’s existing design and requirements for all waterbodies. agreed that location is an important construction technologies, operational The performance standards at factor in assessing the impacts of measures, and/or restoration measures proposed § 125.94(b)(2),(3), and (4) are cooling water intake structure, but that already meet the national minimum based on the type of waterbody in creating a regulatory framework to performance requirements that EPA is which the intake structure is located, specifically address locational issues proposing. the volume of water withdrawn by a would be extremely difficult. In the end, Under the second method, a facility facility, the facility capacity utilization EPA elected not to vary requirements for would select design and construction rate, and the location of a facility’s new facilities on the basis of whether a technology, operational measures, intake structure in relation to fishery cooling water intake structure is located restoration measures or some resources of concern to permit in one or another broad category of combination thereof. The facility would authorities or fishery managers. Under waterbody type. Instead, EPA then demonstrate to the Director that its the proposed rule, EPA would group promulgated the same technology-based selected approach would meet the waterbodies into five categories: (1) performance requirements for all new performance requirements EPA is Freshwater rivers or streams, (2) lakes or facilities, regardless of the waterbody proposing. reservoirs, (3) Great Lakes, (4) tidal type after finding this approach to be Under the third method, a facility rivers and estuaries, and (5) oceans. The economically practicable. would calculate its cost of complying Agency considers location to be an For the Phase II existing facility rule, with the presumptive performance important factor in addressing adverse which would establish the best requirements and compare those costs environmental impact caused by cooling technology available for minimizing either to the compliance costs EPA water intake structures. Because adverse environmental impact in all estimated in the analysis for this different waterbody types have different waterbody types, EPA is again potential for adverse environmental proposing an approach that it believes is 50 Schmitt, R.J. and C.W. Osenberg. 1996. impact, the requirements proposed to economically practicable, but is Detecting ecological impacts. Academic Press, San minimize adverse environmental impact proposing to require the most control in Diego, CA. would vary by waterbody type. For areas where such controls would yield 51 EPRI. 1999. Catalog of assessment methods for evaluating the effects of power plant operations on example, estuaries and tidal rivers have the greatest reduction in impingement aquatic communities. TR–112013, EPRI, Palo Alto, a higher potential for adverse impact and entrainment. EPA believes that CA. because they contain essential habitat section 316(b) affords EPA such VerDate 11 discretion because unlike the sections believes that, absent entrainment extent to which fishery stocks that rely authorizing technology-based effluent control technologies entrainment, at a upon tidal rivers, estuaries and oceans limitations guidelines and new source particular site is proportional to intake for habitat are overutilized and seeks to performance standards for the discharge flow at that site. As we discuss above, minimize the impact that cooling water of pollutants, section 316(b) expressly EPA believes it is reasonable to vary the intake structures may have on these states that its objective is to require best suite of technologies by the potential for species or forage species on which these technology available for minimizing adverse environmental impact in a fishery stocks may depend. (See adverse environmental impact. EPA waterbody type. EPA is therefore documents 2–019A–R11, 2–019A–R12, believes this language affords the proposing to limit the requirement for 2–019A–R33, 2–019A–R44, 2–020A, 2– Agency discretion to consider the entrainment control in fresh waters to 024A through O, and 3–0059 through 3– environmental effects of various those facilities that withdraw the largest 0063 in the record of the Final New technology options. Therefore, EPA is proportion of water from freshwater Facility Rule (66 FR 65256), Docket # proposing to vary technology-based rivers or streams. W–00–03). performance requirements by waterbody Facilities with cooling water intake EPA is proposing a range of type, requiring more effective controls structures located in a lake or reservoir impingement mortality and entrainment in waterbodies with higher overall would have to implement impingement reduction in its requirements for productivity or greater sensitivity to control technology to reduce facilities that are required to select and impingement and entrainment. impingement mortality by 80 to 95 implement design and construction (Appendix 1 to the preamble presents percent for fish and shellfish, and, if technologies or operational or the proposed regulatory framework in a they expand their design intake restoration measures to minimize flow chart). capacity, the increase in intake flow potential impact from their cooling Under this approach, facilities that must not disrupt the natural thermal water intake structures. The calculation operate at less than 15 percent capacity stratification or turnover pattern of the baseline against which compliance with utilization would be required to have source water. Cooling water intake the performance standards should be only impingement control technology. structures withdrawing from the Great assessed is a shoreline intake with the This level of control was found to be the Lakes would be required to reduce fish capacity to support once-through most economically practicable given and shellfish impingement mortality by cooling and no impingement mortality these facilities’ reduced operating 80 to 95 percent and to reduce or entrainment controls. In many cases levels. In addition, these facilities tend entrainment by 60 to 90 percent. As existing technologies at the site achieve to operate most often in mid-winter or described in the new facility proposed some reduction in impingement and late summer, times of peak energy rule (65 FR 49060) and NODA (66 FR entrainment when compared to this demand but periods of generally low 28853), EPA believes that the Great baseline. In such cases, impingement abundance of entrainable life stages of Lakes are a unique system that should mortality and entrainment reductions fish and shellfish. The flow or capacity be protected to a greater extent than (relative to the calculated baseline) of a cooling water intake structure is other lakes and reservoirs. The Agency achieved by these existing technologies also a primary factor affecting the is therefore proposing to specify should be counted toward compliance entrainment of organisms. The lower the entrainment controls as well as with the performance standards. intake flow at a site, the lesser the impingement controls for the Great EPA is proposing performance ranges potential for entrained organisms. Lakes. rather than a single performance As in the Phase I (new facility) rule, Facilities with cooling water intake benchmark because of the uncertainty EPA is proposing to set performance structures located in a tidal river or inherent in predicting the efficacy of a standards for minimizing adverse estuary would need to implement technology on a site-specific basis. The environmental impact based on a impingement control technology to lower end of the range is being proposed relatively easy to measure and certain reduce impingement mortality by 80 to as the percent reduction that EPA, based metric-reduction of impingement 95 percent and entrainment by 60 to 90 on the available efficacy data, has mortality and entrainment. EPA is percent for fish and shellfish. As determined that all facilities could choosing this approach to provide discussed above, estuaries and tidal achieve if they were to implement certainty about permitting requirements rivers are more susceptible than other available technologies and operational and to streamline and speed the water bodies to adverse impacts from measures on which the performance issuance of permits. impingement and entrainment. standards are based. (See Chapter 5, Facilities with cooling water intake Facilities with cooling water intake ‘‘Efficacy of Cooling Water Intake structures located in a freshwater river structures located in an ocean would Structure Technologies,’’ of the or stream would have different have to implement impingement control Technical Development Document for requirements depending on the technology to reduce impingement the Final Rule for New Facilities, EPA– proportion of the source waterbody that mortality by 80 to 95 percent and 821–R–01–036, November 2001). The is withdrawn. If the intake flow is 5 entrainment by 60 to 90 percent for fish baseline for assessing performance is a percent or less of the source water and shellfish. EPA is establishing Phase II existing facility with a annual mean flow, then the facility requirements for facilities withdrawing shoreline intake with the capacity to would be required to reduce fish and from oceans that are similar to those support once-through cooling and no shellfish impingement mortality by 80 proposed for tidal rivers and estuaries impingement or entrainment controls. to 95 percent. If the intake flow is 5 because the coastal zone of oceans The lower end of the range would take percent or more of the source water (where cooling water intakes withdraw) into account sites where there may be annual mean flow, then the facility are highly productive areas. (See the more fragile species that may not have would be required to reduce fish and new facility proposed rule (65 FR a high survival rate after coming in shellfish impingement mortality by 80 45060) and documents in the record contact with fish protection to 95 percent and reduce entrainment by (Docket # W–00–03) such as 2–013A technologies at the cooling water intake 60 to 90 percent. As described in the through O, 2–019A–R11, 2–019A–R12, structure (i.e., fine mesh screens). The new facility proposed rule (65 FR 2–019A–R33, 2–019A–R44, 2–020A, 3– higher end of the range is being 49060) and NODA (66 FR 28853), EPA 0059.) EPA is also concerned about the proposed as a percent reduction that VerDate 11 available data show many facilities can with conventional once-through existing steam electric power generating and have achieved with the available systems. EPA notes that screening to facilities. Of these, 53 facilities that technologies on which the performance prevent organism entrainment may operate at less than 15 percent capacity standards are based. Some facilities may cause impingement of those organisms utilization would potentially require be able to exceed the high end of the instead. Questions regarding only impingement controls, with 34 of performance range, though they would impingement survival of relatively these estimated to actually require such not be required to do so by today’s delicate fish, larvae, and eggs would controls. (The remaining 19 facilities proposed rule. In specifying a range, need to be considered by the Director have existing impingement controls). Of EPA anticipates that facilities will select and the facility in evaluating the the remaining 486 facilities, the technologies or operational measures to efficacy of the technology. In addition, proposed rule would not require any achieve the greatest cost-effective all of these screening-and-return changes at approximately 69 large reduction possible (within today’s technologies would need to be existing facilities with recirculating wet proposed performance range) based on evaluated on a case-by-case basis to cooling systems (e.g., wet cooling towers conditions found at their site, and that determine if they are capable of or ponds). Directors will review the facility’s screening and protecting the specific Of the remaining 417 steam electric application to ensure that appropriate species of fish, larvae and eggs that are power generating facilities (i.e., those alternatives were considered. EPA also of concern at a particular facility. that exceed 15 percent capacity expects that some facilities may be able Several additional factors suggest that utilization and have non-recirculating to meet these performance requirements the performance levels discussed above systems), EPA estimates that 94 are by selecting and implementing a suite and described in more detail in Chapter located on freshwater lakes or (i.e., more than one) of technologies and 5 of the Technical Development reservoirs, 13 are located on the Great operational measures and/or, as Document for the Final New Facility Lakes, 109 are located on oceans, discussed below, by undertaking Rule can be improved. First, some of the estuaries, or tidal rivers, and 201 are restoration measures. EPA invites performance data reviewed is from the located on freshwater rivers or streams. comment on whether the Agency should 1970’s and 1980’s and does not reflect Of the 94 Phase II existing facilities establish regulatory requirements to recent developments and innovations located on freshwater lakes or ensure that facilities achieve the greatest (e.g., aquatic filter barrier systems, reservoirs, EPA estimates that 67 of possible reduction (within the proposed sound barriers). Second, these these facilities would have to install ranges) that can be achieved at their site conventional barrier and return system impingement controls and that 27 using the technologies on which the technologies have not been optimized facilities already have impingement performance standards are based. EPA on a widespread level to date, as would controls that meet the proposed rule also invites comment on whether EPA be encouraged by this rule. Third, EPA requirements. As for existing steam should leave decisions about believes that many facilities could electric power generating facilities appropriate performance levels for a achieve further reductions (estimated at located on the Great Lakes, EPA facility to the Director, provided that the 15–30 percent) in impingement estimates that the proposed rule would facility will achieve performance that is mortality and entrainment by providing require all 13 such facilities to install no lower than the bottom of the for seasonal flow restrictions, variable impingement and entrainment controls. performance ranges in today’s proposal. speed pumps, and other operational Of the 109 facilities located on EPA based the presumptive measures and innovative flow reduction estuaries, tidal rivers, or oceans, EPA performance standards specified at alternatives. For additional discussion, estimates that 15 facilities would 125.94(b), (c), and (d) for impingement see section 5.5.11 in the Technical already meet today’s proposed mortality reduction, compared with Development Document for the new impingement and entrainment controls. conventional once-through systems, on facility rule. The remaining 94 facilities would need the following technologies: (1) Design EPA notes that available data to install additional technologies to and construction technologies such as described in Chapter 5 of the Technical reduce impingement, entrainment, or fine and wide-mesh wedgewire screens, Development Document for the Final both. as well as aquatic filter barrier systems, Rule for New Facilities suggest that For Phase II existing facilities located that can reduce mortality from closed-cycle, recirculating cooling on freshwater river or streams, the impingement by up to 99 percent or systems (e.g., cooling towers or ponds) proposed rule would establish an intake greater compared with conventional can reduce mortality from impingement flow threshold of five (5) percent of the once-through systems; (2) barrier nets by up to 98 percent and entrainment by mean annual flow. Facilities that may achieve reductions of 80 to 90 up to 98 percent when compared with withdrawing more than this threshold percent; and (3) modified screens and conventional once-through systems. would have to meet performance fish return systems, fish diversion Therefore, although closed-cycle, standards for reducing both systems, and fine mesh traveling screens recirculating cooling is not one of the impingement mortality and and fish return systems that have technologies on which the presumptive entrainment. Facilities withdrawing less achieved reductions in impingement standards are base, use of a closed-cycle, than the threshold would only have to mortality ranging from 60 to 90 percent recirculating cooling system would meet performance standards for as compared to conventional once- achieve the presumptive standards. The reducing impingement mortality. EPA through systems. (See Chapter 5 of the proposed rule, at § 124.94(b)(1) would estimates that of 201 facilities located Technical Development Document for thus establish the use of a closed-cycle, on freshwater river or streams, 94 are at the Final Rule for New Facilities.) recirculating cooling system as one or below the flow threshold, and that Less full-scale performance data are method for meeting the presumptive only 53 of these facilities would have to available for entrainment reduction. standards. install additional impingement controls Aquatic filter barrier systems, fine mesh Based on an analysis of data collected (the remaining facilities have controls in wedgewire screens, and fine mesh through the detailed industry place to meet the proposed rule traveling screens with fish return questionnaire and the short technical requirements). EPA estimates that 107 systems achieve 80 to 90 percent greater questionnaire, EPA believes that today’s facilities exceed the flow threshold. reduction in entrainment compared proposed rule would apply to 539 Twenty one (21) of these facilities have VerDate 11 sufficient controls in place; 86 would c. How Could a Phase II Existing meantime, the facility would be require entrainment or impingement Facility Use Newly Selected Design and considered in compliance with its and entrainment controls. Construction Technologies, Operational permit as long as it was satisfying all Measures, and/or Restoration Measures permit conditions. EPA solicits b. How Could a Phase II Existing To Establish Best Technology Available comment on whether the proposed Facility Use Existing Design and for Minimizing Adverse Environmental regulation should specify that proper Construction Technologies, Operational Impact? design, installation, operation and Measures, and/or Restoration Measures Under the second option for maintenance would satisfy the terms of To Establish Best Technology Available determination of best technology the permit until the permit is reissued for Minimizing Adverse Environmental available specified in proposed pursuant to a revised Design and Impact? § 125.94(a)(2), an owner or operator of a Construction Technology Plan. If EPA Phase II existing facility that does not were to adopt this approach, EPA would Under the first option for specify in the regulations that the already employ sufficient design and determination of best technology Director should require as a permit construction technologies, operational available, as specified in proposed condition the proper design, measures, or restoration measures to § 125.94(a)(1), an owner or operator of a installation, operation and maintenance meet the proposed performance Phase II existing facility may of design and construction technologies standards must select additional demonstrate to the permit-issuing and operational measures rather than technologies and operational or Director that it already employs design compliance with performance restoration measures. The owner or standards. and construction technologies, operator must demonstrate to the operational measures, or restoration permit-issuing Director that these d. How Could a Phase II Existing measures that meet the performance additions will, in conjunction with any Facility Qualify for a Site-Specific requirements proposed today. To do this existing technologies and measures at Determination of Best Technology the owner or operator would calculate the site, meet today’s proposed Available for Minimizing Adverse impingement mortality and entrainment performance standards. EPA expects Environmental Impact? reductions of existing technologies and that some facilities may be able to meet Under the third option for measures relative to the calculation their performance requirements by determination of best technology baseline and compare these reductions selecting and implementing a suite (i.e., available, specified in proposed to those specified in the applicable more than one) of technologies, § 125.94(a)(3), the owner or operator of performance standards. EPA expects operational, or restoration measures. a Phase II existing facility may that owners and operators of some To adequately demonstrate the demonstrate to the Director that a site- facilities may be able to demonstrate efficacy of the selected technologies, specific determination of best compliance through a suite of (i.e., operational measures, and/or restoration technology available is appropriate for multiple) existing technologies, measures, a facility must conduct and the cooling water intake structure(s) at operational measures, and/or restoration submit for the Director’s review a that facility if the owner or operator can measures. Comprehensive Demonstration Study as meet one of the two cost tests specified specified in proposed § 125.95(b) and in proposed § 125.94(c)(1). To be To adequately demonstrate the described in section VII of today’s efficacy of existing technologies, eligible to pursue this approach, the preamble. In this Study, the owner or facility must first demonstrate to the operational measures, and/or restoration operator would characterize the Director either: (1) that its costs of measures, a facility owner or operator impingement mortality and entrainment compliance with the applicable must conduct and submit for the due to the cooling water intake performance standards specified in Director’s review a Comprehensive structure, describe the nature and § 125.94(b) would be significantly Demonstration Study as specified in operation of the intake structure, and greater than the costs considered by the proposed § 125.95(b) and described in describe the nature and performance Administrator in establishing such section VII of today’s preamble. In this levels of both the existing and proposed performance standards; or (2) that the Study, the owner or operator would technologies, operational measures, and facility’s costs would be significantly characterize the impingement mortality restoration measures for mitigating greater than the benefits of complying and entrainment due to the cooling impingement and entrainment impacts. with the performance standards at the water intake structure, describe the Owners and operators may use existing facility’s site. A discussion of applying nature and operation of the intake data for the Study as long as it the cost test is provided in section structure, and describe the nature and adequately reflects current conditions at VI.A.12 of this proposed rule. A performance levels of the existing the facility and in the waterbody from discussion of applying the test in which technologies, operational measures, and which the facility withdraws cooling costs are compared to benefits is restoration measures for mitigating water. provided in Section VI.A.8. impingement and entrainment impacts. If compliance monitoring determines To adequately demonstrate the Owners and operators may use existing that the design and construction, efficacy of the selected technologies, operating measures, or restoration operational measures, and/or restoration data for the Study as long as it measures prescribed by the permit have measures considered in the site-specific adequately reflects current conditions at been properly installed and were cost tests, a facility must conduct and the facility and in the waterbody from properly operated and maintained, but submit for the Director’s review a which the facility withdraws cooling were not achieving compliance with the Comprehensive Demonstration Study as water. applicable performance standards, the specified in proposed § 125.95(b) and Director could modify permit described in section VII of today’s requirements consistent with existing preamble. In this Study, the owner or NPDES program regulations (e.g., 40 operator would characterize the CFR 122.62, 122.63, and 122.41) and the impingement mortality and entrainment provisions of this proposal. In the due to the cooling water intake VerDate 11 structure, describe the nature and matches its fuel source, mode of 1985. Big Bend supplies cooling water operation of the intake structure, and electricity generation, existing intake to its once-through cooling water describe the nature and performance technologies, waterbody type, systems via two intake structures. When levels of the existing technologies, geographic location, and intake flow the facility added Unit 4 in 1985, operational measures, and restoration and compare its engineering estimates regulators required the facility to install measures for mitigating impingement to EPA’s estimated cost for this model additional intake technologies. A fish and entrainment impacts. Owners or plant . handling and return system, as well as operators would also need to document a fine-mesh traveling screen (used only 2. What Available Technologies Are the costs to the facility of any additional during months with potentially high Proposed as Best Technology Available technologies or measures that would be entrainment rates), were installed on the for Minimizing Adverse Environmental needed to meet the performance intake structure serving both the new Impact? standards and in the case of the site- Unit 4 and the existing Unit 3. specific cost to benefits test, the Currently, 14 percent of Phase II Salem Generating Station. A 2381 monetized benefits of meeting the existing facilities potentially subject to MW facility (nameplate, nuclear), Salem standards. Owners and operators may this proposal already have a closed- is located on the Delaware River in use existing data for the Study as long cycle recirculating cooling water system Lower Alloways Creek Township, New as it adequately reflects current (69 facilities operating at 15 percent Jersey. The facility has two generating conditions at the facility and in the capacity utilization or more and 4 units, both of which use once-through waterbody from which the facility facilities operating at less than 15 cooling and began operations in 1977. In withdraws cooling water. percent capacity utilization). In 1995, the facility installed modified Where a Phase II existing facility addition, 50 percent of the remaining Ristroph screens and a low-pressure demonstrates that it meets either of the potentially regulated facilities have spray wash with a fish return system. cost tests, the Director is to make a site- some other technology in place that The facility also redesigned the fish specific determination of best reduces impingement or entrainment. return troughs to reduce fish trauma. technology available for minimizing Thirty-three percent of these facilities Chalk Point Generating Station. adverse environmental impact. This have fish handling or return systems Located on the Patuxent River in Price determination would be based on less that reduce the mortality of impinged George’s County, Maryland, Chalk Point costly design and construction organisms. has a nameplate capacity of 2647 MW technologies, operational measures, EPA finds that the design and (oil-fired steam). The facility has 4 and/or restoration measures proposed construction technologies necessary to generating units and uses a combination by the facility and approved by the meet the proposed requirements are of once-through and closed cycle Director. The Director would approve commercially available and cooling (two once-through systems less costly technologies to the extent economically practicable, because serving two generating units and one justified by the significantly greater cost. facilities can and have installed many of recirculating system with a tower Phase II Existing facilities that pursue these technologies years after a facility serving the other two generating units). this option would have to assess the began operation. Typically, additional In 1983, the facility installed a barrier nature and degree of adverse design and construction technologies net, followed by a second set of netting environmental impact associated with such as fine mesh screens, wedgewire in 1985, giving the facility a coarse their cooling water intake structures, screens, fish handling and return mesh (1.25″) outer net and a fine mesh and then identify the best technology systems, and aquatic fabric barrier (.75″) inner net. The barrier nets are available to minimize such impact. systems can be installed during a anchored to a series of pilings at the Owners and operators would be scheduled outage (operational mouth of the intake canal that supplies required to submit to the Director for shutdown). Referenced below are the cooling water to the facility and approval a Site-Specific Technology examples of facilities that installed serve to reduce both entrainment and Plan. This plan would be based on a these technologies after they initially the volume of trash taken in at the Comprehensive Cost Evaluation Study started operating. facility. and a Valuation of Monetized Benefits Lovett Generating Station. A 495 MW EPA believes that the technologies of Reducing Impingement and facility (nameplate, gas-fired steam), used as the basis for today’s proposal Entrainment, as required by proposed Lovett is located in Tomkins Cove, New are commercially available and § 125.95(b)(6)(i) and (ii). (See section York, along the Hudson River. The economically practicable (see VII). The Plan would describe the facility first began operations in 1949 discussion below) for the industries design and operation of all design and and has 3 generating units with once- affected as a whole, and have negligible construction technologies, operational through cooling systems. In 1994, Lovett non-water quality environmental measures, and restoration measures began the testing of an aquatic filter impacts, including energy impacts. The selected, and provide information that fabric barrier system to reduce proposed option would meet the demonstrates the effectiveness of the entrainment, with a permanent system requirement of section 316(b) of the selected technologies or measures for being installed the following year. CWA that the location, design, reducing the impacts on the species of Improvements and additions were made construction, and capacity of cooling concern. to the system in 1997, 1998, and 1999, water intake structures reflect the best To document that its site-specific with some adjustments being accepted technology available for minimizing costs would be significantly greater than as universal improvements for all adverse environmental impact. those EPA considered, the facility subsequent installations of this vendor’s would need to develop engineering cost technology at other locations. 3. Economic Practicability estimates as part of its Comprehensive Big Bend Power Station. Situated on EPA believes that the requirements of Cost Evaluation Study. The facility Tampa Bay, Big Bend is a 1998 MW this proposal are economically would then consider the model plants (nameplate, coal-fired steam) facility practicable. EPA examined the presented in EPA’s Technical with 4 generating units. The facility first annualized post-tax compliance costs of Development Document, determine began operations in 1970 and added the proposed rule as a percentage of which model plant most closely generating units in 1973, 1976, and annual revenues to determine whether VerDate 11 the options are economically experience greater impacts if they own to the early retirement of any existing practicable. This analysis was more than one facility with compliance generating capacity, and would have conducted both at the facility and firm costs. EPA therefore also analyzed the very small or no energy effects. After levels. economic practicability of this proposed considering all of these factors, EPA concludes that the costs of the proposed a. Facility Level rule at the firm level. EPA identified the domestic parent entity of each in-scope rule are economically practicable. EPA examined the annualized post- facility and obtained their sales revenue d. Benefits tax compliance costs of the proposed from publicly available data sources (the rule as a percentage of annual revenues, 1999 Forms EIA–860A, EIA–860B, and As described in Section IX., EPA for each of the 550 facilities subject to EIA–861; and the Dun and Bradstreet estimates the annualized benefits of the this proposed rule. 52 The revenue database) as well as EPA’s 2000 Section proposed rule would be $70.3 million estimates are facility-specific baseline 316(b) Industry Survey. This analysis for impingement reductions and $632.4 projections from the Integrated Planning showed that 131 unique domestic million for reduced entrainment. For a Model (IPM) for 2008 (see Section VIII. parent entities own the facilities subject more detailed discussion, also see the Economic Analysis of this document for to this proposed rule. EPA compared the Economic and Benefits Analysis for the a discussion of EPA’s analyses using the aggregated annualized post-tax Proposed Section 316(b) Phase II IPM). The results of this analysis show compliance costs for each facility Existing Facilities Rule. that the vast majority of facilities subject owned by the 131 parent entities to the 4. Site-Specific Determination of Best to the proposed rule, 409 out of 550, or firms’ total sales revenue. Based on the Technology Available approximately 74 percent, would incur results from this analysis, EPA Under today’s proposed rule, the annualized costs of less than 1 percent concludes that the proposed rule will be owner or operator of an Phase II existing of revenues. Of these, 331 facilities economically practicable at the firm would incur compliance costs of less facility may demonstrate to the Director level. that a site-specific determination of best than 0.5 percent of revenues. Eighty-two EPA estimates that the compliance technology available is appropriate for facilities, or 15 percent, would incur costs will comprise a very low the cooling water intake structures at costs of between 1 and 3 percent of percentage of firm-level revenues. Of the that facility if the owner or operator can revenues, and 46 facilities, or 8 percent, 131 unique entities, 3 would incur meet one of the two cost tests specified would incur costs of greater than 3 compliance costs of greater than 3 percent. Eleven facilities are estimated under § 125.94(c)(1). To be eligible to percent of revenues; 10 entities would pursue this approach, the facility must to be baseline closures, and for one incur compliance costs of between 1 facility, revenues are unknown. 53 first demonstrate to the Director either and 3 percent of revenues; 12 entities (1) that its costs of compliance with the Exhibit 2 below summarizes these would incur compliance costs of findings. applicable performance standards between 0.5 and 1 percent of revenues; specified in § 125.94(b) would be and the remaining 104 entities would EXHIBIT 2.—PROPOSED RULE significantly greater than the costs incur compliance costs of less than 0.5 considered by the Administrator in (FACILITY LEVEL) 54 percent of revenues. The estimated establishing such performance annualized compliance costs represent standards, or (2) that its costs of Annualized cost-to- All Percent between 0.002 and 5.3 percent of the revenue ratio phase II of total complying with such standards would phase II entities’ annual sales revenue. Exhibit 3 be significantly greater than the below summarizes these findings. environmental benefits at the site. <0.5% ...... 331 60 The proposed factors that may justify 0.5–1.0% ...... 78 14 EXHIBIT 3.—PROPOSED RULE 1.0–3.0% ...... 82 15 a site-specific determination of the best ACILITY EVEL >3.0% ...... 46 8 (F L ) technology available requirements for Baseline Closure ...... 11 2 Phase II existing facilities differ in two n/a ...... 1 0 Number Percent- major ways from those in EPA’s recently Annualized cost-to- of age revenue ratio phase II of total promulgated rule for new facilities. Total ...... 550 100 entities phase II First, the new facility rule required costs to be ‘‘wholly disproportionate’’ to the b. Firm Level <0.5% ...... 104 79 costs EPA considered when establishing Facility-leval compliance costs are 0.5–1.0% ...... 12 9 the requirement at issue rather than 1.0%–3.0 ...... 10 8 ‘‘significantly greater’’ as proposed low compared to facility-level revenues. >3.0% ...... 3 2 However, the firms owning the facilities Baseline Closures ..... 2 2 today. EPA’s record for the Phase I rule subject to the proposed rule may shows that those facilities could Total ...... 131 100 technically achieve and economically 52 EPA’s 2000 Section 316(b) Industry Survey afford the requirements of the Phase I identified 539 facilities that are subject to this c. Additional Impacts rule. New facilities have greater proposed rule. EPA applied sample weights to the flexibility than existing facilities in 539 facilities to account for non-sampled facilities As described in Sections VIII and X.J selecting the location of their intakes and facilities that did not respond to the survey. below, EPA also considered the The 539 analyzed facilities represent 550 facilities and technologies for minimizing in the industry. potential effects of the proposed rule on adverse environmental impact so as to 53 IPM revenues for 2008 were not available for installed electric generation capacity, avoid potentially high costs. Therefore, 11 facilities estimated to be baseline closures, 10 electrical production, production costs, facilities not modeled by the IPM, and 9 facilities EPA believes it appropriate to push new and electricity prices. EPA determined facilities to a more stringent economic projected to have zero baseline revenues. EPA used that the proposed rule would not lead facility-specific electricity generation and firm- standard. Additionally, looking at the specific wholesale prices as reported to the Energy question in terms of its national effects Information Administration (EIA) to calculate the 54 Two entities only own Phase II facilities that cost-to-revenue ratio for the 19 non-baseline closure are projected to be baseline closures. EPA estimated on the economy, EPA notes that in facilities with missing information. The revenues that for both entities, the compliance costs incurred contrast to the Phase I rule, this rule for one of these facilities remained unknown. would have been less than 0.5 percent of revenues. would affect facilities responsible for a VerDate 11 significant portion (about 55 percent) of again, because today’s proposal would of design and construction technologies existing electric generating capacity, affect so many facilities that are or operational measures, the facility whereas the new facility rule only responsible for such a significant would demonstrate to the Director that affects a small portion of electric portion of the country’s electric the control technologies combined with generating capacity projected to be generating capacity, EPA is interested in restoration efforts will maintain the fish available in the future (about 5 percent). reducing costs where it can do so and shellfish, including the community EPA believes it is appropriate to set a without significantly impacting aquatic structure and function, in the waterbody lower cost threshold in this rule to communities (recognizing this could at a comparable or substantially similar avoid economically impracticable increase permitting work loads for the level to that which would be achieved impacts on energy prices, production State and Federal permit writers). through § 125.94 (b) and (c). EPA invites costs, and energy production that could EPA invites comment on whether the comment on all aspects of this occur if large numbers of Phase II standards proposed today might allow approach. EPA specifically invites existing facilities incurred costs that are for backsliding by facilities that have comment on whether restoration more than significantly greater than but technologies or operational measures in measures should be allowed only as a not wholly disproportionate to the costs place that are more effective than in supplement to technologies or in EPA’s record. EPA invites comment today’s proposal. EPA invites comment operational measures. EPA also seeks on whether a ‘‘significantly greater’’ cost on approaches EPA might adopt to comment on the most appropriate test is appropriate for evaluating ensure that backsliding from more spatial scale under which restoration requests for alternative requirements by effective technologies does not occur. efforts should be allowed ‘‘should Phase II existing facilities. If a facility satisfies one of the two restoration measures be limited to the cost tests in the proposed § 125.94(c)(1), waterbody at which a facility’s intakes Second, today’s proposal includes an it must propose less costly design and opportunity for a facility to demonstrate are sited, or should they be construction technologies, operational implemented on a broader scale, such as significantly greater costs as compared measures, and restoration measures to to environmental benefits at a specific at the watershed or State boundary the extent justified by the significantly level. site. As stated above, EPA’s record for greater costs. In some cases the the Phase I rule shows that new significantly greater costs may justify a Under today’s preferred option, any facilities could technically achieve and determination that no additional restoration demonstration must address economically afford the requirements of technologies or measures are species of concern identified by the the Phase I rule. At the same time, EPA appropriate. This would be most likely permit director in consultation with was interested in expeditious permitting in cases where either (1) the monetized Federal, State, and Tribal fish and for these new facilities, due to increased benefits at the site were very small (e.g., wildlife management agencies that have energy demand, and particular energy a facility with little impingement responsibility for aquatic species issues facing large portions of the mortality and entrainment, even in the potentially affected by a facility’s country. For this reason, EPA chose not calculated baseline), or (2) the costs of cooling water intake structure(s). EPA to engage in a site-specific analysis of implementing any additional invites comment on the nature and costs and benefits, because to do this technologies or measures at the site extent of consultations with Federal, properly would take time. Balancing the were unusually high. State, and Tribal fish and wildlife desire for expeditious permitting with a management agencies that would be record that supported the achievability 5. What Is the Role of Restoration Under appropriate in order to achieve the of the Phase I requirements, EPA Today’s Preferred Option? objectives of section 316(b) of the CWA. believes it was reasonable not to adopt Under today’s preferred option, In general, EPA believes that a cost benefit alternative for the Phase restoration measures can be consultations should seek to identify the I rule. By contrast, Phase II existing implemented by a facility in lieu of or current status of species of concern facilities will be able to continue in combination with reductions in located within the subject waterbody operating under their existing permits impingement mortality and and provide general life history pending receipt of a permit entrainment. Thus, should a facility information for those species, including implementing the Phase II regulations, choose to employ restoration measures preferred habitats for all life stages. even where their existing permit has rather than reduce impingement Consultations also should include expired (Permits may be mortality or entrainment, the facility discussion of potential threats to species administratively continued under could demonstrate to the Director that of concern found within the waterbody section 558(c) of the Administrative the restoration efforts will maintain the other than cooling water intake Procedure Act if the facility has filed a fish and shellfish in the waterbody, structures (i.e., identify all additional timely application for a new permit). including the community structure and stressors for the species of concern), Therefore, delay in permitting, which function, at a level comparable to that appropriate restoration methods, and could affect the ability of a new facility which would be achieved through monitoring requirements to assess the to begin operations while such a site- § 125.94 (b) and (c). In those cases overall effectiveness of proposed specific analysis is conducted, is not an where it is not possible to quantify restoration projects. EPA believes that it issue for existing facilities. Also, EPA restoration measures, the facility may is important that the consultation occur recognizes that Phase II existing demonstrate that such restoration because natural resource management facilities have already been subject to measures will maintain fish and agencies typically have the most requirements under section 316(b). EPA shellfish in the waterbody at a level accurate information available and thus is not certain that it is necessary to substantially similar to that which are the most knowledgeable about the overturn the work done in making those would be achieved under § 125.94 (b) status of the aquatic resources they determinations by necessarily requiring and (c). manage. EPA seeks comment on the retrofit of the existing system without Similarly, should a facility choose to type of information that would be allowing facilities and permit implement restoration measures in appropriate to include in a written authorities to examine what the conjunction with reducing impingement request for consultation submitted to the associated costs and benefits. Once mortality and entrainment through use State, Tribal, and Federal agencies VerDate 11 responsible for management of aquatic However, as it did in the preamble to comment on how it may measure the resources within the waterbody at the final new facility rule, EPA success or failure of restoration which the cooling water intake is sited. recognizes that, due to data and activities given the high degree of A copy of the request and any agency modeling limitations as well as the uncertainty associated with many areas responses would be included in the uncertainty associated with restoration of this developing science and that permit application. measures such as creation of new many of these activities do not produce Under the preferred option, an habitats to serve as spawning or nursery measurable results for many months or applicant who wishes to include areas, it may be difficult to establish years after they are implemented. For restoration measures as part of its quantitatively that some restoration these reasons, EPA requests comment demonstration of comparable measures adequately compensate for on whether to require that a facility performance would submit the entrainment and impingement losses using restoration measures restore more following information to the Director for from cooling water withdrawals. The fish and shellfish than the number review and approval: success of many approaches to subjected to impingement mortality or • A list and narrative description of restoration depends on the functions, entrainment. EPA believes that restoring the proposed restoration measures; behavior, and dynamics of complex or mitigating above the level that • A summary of the combined biological systems that are often not reflects best technology available for benefits resulting from implementation scientifically understood as well as minimizing adverse environmental of technology and operational controls engineered technologies. impact (e.g., restocking higher numbers and/or restoration measures and the There are, however, several steps that of fish than those impinged or entrained proportion of the benefits that can be can be taken to increase the certainty of by facility intakes or restoring aquatic attributed to these; attainment of performance levels by system acreages at ratios greater than • A plan for implementing and restoration measures. Most of these one-to-one) would help build a margin maintaining the efficacy of selected steps require detailed planning prior to of safety, particularly when the restoration measures and supporting initiation of restoration efforts. Under uncertainties associated with a documentation that shows that today’s preferred option, restoration particular restoration activity are known restoration measures or restoration planners would take care to incorporate to be high. measures in combination with control allowances in their plans for the The concept of compensatory technologies and operational measures uncertainties stemming from incomplete mitigation ratios being greater than one- will maintain the fish and shellfish, knowledge of the dynamics underlying to-one is found in other programs. For including community structure, at aquatic organism survival and habitat example, under the CWA section 404 substantially similar levels to those creation. Plans would include program no set mitigation ratio exists, specified at § 125.94 (b) and (c); however, current policies require no net • provisions for monitoring and A summary of any past or voluntary evaluating the performance of loss of aquatic resources on a consultation with appropriate Federal, restoration measures over the lifetime of programmatic basis. The permitting State, and Tribal fish and wildlife the measures. Provisions would also be authority often requires permit management agencies related to made for mid-course corrections as applicants to provide more than one-to- proposed restoration measures and a necessary. Unexpected natural forces one mitigation on an acreage basis to copy of any written comments received can alter the direction of a restoration address the time lapse between when as a result of consultations; and project.55 If uncertainty regarding levels the permitted destruction of wetlands • Design and engineering of performance is high enough, takes place and when the newly calculations, drawings, and maps restoration planners would consider restored or created wetlands are in place documenting that proposed restoration restoration measures in addition to and ecologically functioning. The measures will meet the performance those otherwise calculated as sufficient permit may also require more than one- standard at § 125.94 (d). in order to ensure adequate levels of to-one replacement to reflect the fact EPA believes this information is that mitigation is often only partially necessary and sufficient for the proper performance. EPA invites comment on how to measure ‘‘substantially similar successful. Alternatively, in evaluation of a restoration plan circumstances where there is a high designed to achieve comparable performance’’ of restoration measures and methods that can be used to reduce confidence that the mitigation will be performance for species of concern ecologically successful, the restoration/ identified by the Director in the uncertainty of restoration activities undertaken as part of today’s preferred creation has already been completed consultation with fish and wildlife prior to permitted impacts, or when the management agencies. EPA invites option. EPA recognizes that substantial replacement wetlands will be of greater comment on whether this information is information exists regarding wetlands ecological value than those they are appropriate and adequate or if it should mitigation and restoration. For example, replacing, the permitting authority may be augmented or streamlined. EPA tools and procedures exist to assess require less than one-to-one invites comment on what specific, wetlands in the context of section 404 replacement. additional information should be In the case of section 316(b), of the Clean Water Act.56 However, included in a facility’s restoration plan restocking numbers and restoration restoration of other aquatic systems and/or which of the proposed ratios could be established either by the such as estuaries is complex and information requirements are Director on a permit-by-permit basis or continues to evolve. EPA seeks unnecessary. by EPA in the final rule. EPA requests For restoration measures such as fish comment on establishing margins of 55 For a discussion of the extensive range of restocking programs, EPA expects that experience with wetland restoration efforts, see safety for restoration measures applicants will be able to quantitatively Wetlands, Third Edition, William J. Mitsch and (particularly for activities associated demonstrate increases in fish and James G. Gosselink, pp. 653–686. with outcomes having a high degree of shellfish that are comparable to the 56 For a general discussion on different uncertainty) and identifying the assessment procedures see The Process of Selecting performance that would be achieved by a Wetland Assessment Procedure: Steps and appropriate authority for establishing meeting the performance standards for Considerations, by Candy C. Bartoldus, Wetland safety measures. EPA also seeks reducing impingement and entrainment. Journal, Vol. 12, No. 4, Fall 2000. comment on an appropriate basis for VerDate 11 establishing safety margins (e.g., based properly designed, of simultaneously measures with other restoration exclusively on project uncertainty, providing suitable survival conditions measures during the early stages of relative functional value or rareness of for multiple species. In contrast, habitat creation in order to ensure all the system being restored, or a measures such as stocking and fish facility impacts are properly mitigated. combination of these) to ensure that ladders provide benefits for much more Under the preferred option, restoration measures achieve limited number of species and life restoration plans should be developed performance comparable to intake stages. in sufficient detail to address the issues technologies. In some cases, conservation of above before significant resources are EPA also recognizes that restoration existing, functional habitats— committed or other actions taken that measures may in some cases provide particularly conservation of habitats that are difficult to reverse. EPA invites additional environmental benefits that are vulnerable to human encroachment comment on the role of restoration in design and construction technologies and other anthropogenic impacts—may addressing the impact of cooling water and operational measures focused solely be desirable as part of a facility’s intake structures. EPA invites on reducing impingement and restoration effort. In the case of commenters to suggest alternative entrainment would not provide. For conservation, the functionality of the approaches to ensuring that restoration example, fish restocking facilities may habitat would not be compromised, efforts are successful. be able to respond, on relatively short therefore eliminating much of the notice, to species-specific needs or uncertainty associated with measuring 6. Impingement and Entrainment threats, as identified by fish and wildlife the success of other restoration efforts Assessments management agencies. Habitat such as habitat enhancement or a. What Are the Minimum Elements of restoration measures may provide creation. However, because conserved an Impingement Mortality and important benefits beyond direct effects habitat is already contributing to the Entrainment Characterization Study? on fish and shellfish numbers, such as relative productivity and diversity of an Today’s proposal requires the permit flood control, habitat for other wildlife aquatic system, conservation measures applicant to conduct an Impingement species, pollution reduction, and would not necessarily ensure a net Mortality and Entrainment recreation. EPA requests comment on benefit to the waterbody or watershed of whether and how additional concern. EPA seeks comment on Characterization Study § 125.95(b)(3) to environmental benefits should also be whether habitat conservation would be support many important analyses and considered in determining appropriate an appropriate component of a facility’s decisions. The data from this Study fish and shellfish rates for restoration restoration efforts. supports development of the calculation projects. Restoration projects should not baseline for evaluating reductions in Assessing the full range of unduly compromise the health of impingement mortality and requirements necessary for the survival already-existing aquatic organisms in entrainment, documents current of aquatic organisms requires order to restore aquatic organisms for impingement mortality and understanding and use of knowledge purposes of section 316(b). Such entrainment, and provides the basis for from multiple scientific disciplines alterations could negate or detract from evaluating the performance of potential (aquatic biology, hydrology, landscape accomplishments under a restoration technologies, operational measures and/ ecology) that together address the plan and produce an insufficient net or restoration measures. Should a biological and physical requirements of benefit. For example, fish stocking facility request a site-specific particular species. Under today’s programs might introduce disease or determination of best technology preferred option, restoration planners weaken the genetic diversity of an available for minimizing adverse would utilize the full range of ecosystem. Habitat creation programs environmental impact, the Study would disciplines available when designing should not alter well-functioning provide the critical biological data for restoration measures for a facility. Plans habitats to better support species of estimating monetized benefits. utilizing an insufficient range of concern identified in the restoration EPA invites comment on whether the knowledge are more likely to fail to plan, but rather should focus on narrative criteria at § 125.95(b)(1) are account for all aquatic organism restoring degraded habitats that sufficiently comprehensive and specific survival requirements. historically supported the types of to ensure that scientifically valid, For some aquatic organisms, or for aquatic organisms currently impacted representative data are used to support certain life stages of some aquatic by a facility’s cooling water intake. the various approaches for determining organisms, there may not be sufficient Another issue to consider when best technology available for knowledge of the factors required for relying on restoration projects that minimizing adverse environmental that organism’s survival and thus involve habitat creation is that many impact in today’s proposal. EPA restoration planners would be unable to such projects can take months or years recognizes the difficulties in obtaining address those factors directly in a to reach their full level of performance. accurate and precise samples of aquatic restoration plan. In such cases, it may be The performance of these projects often organisms potentially subject to necessary for restoration planners to relies heavily on establishment and impingement and entrainment. EPA also plan to create habitat that replicates as growth of higher vegetation and of the recognizes that biological activity in the closely as possible those habitats in natural communities that rely on such vicinity of a cooling water intake which the aquatic organisms are found vegetation. Establishment and growth of structure can vary to great degree, both to thrive naturally. Suitable habitat can both vegetation and natural within and between years, seasons and be created or restored, or existing communities can take months to years intervals including time-of-day. EPA habitats can be enhanced in order to depending on the type of habitat under invites comment on whether it should provide suitable habitat for the development. Restoration planners need set specific, minimum monitoring organisms of concern. In this manner, to ensure that performance levels are frequencies and/or whether it should appropriate conditions can be created met at all points in a mitigation process. specify requirements for ensuring even without full understanding of an Where facilities are depending in part appropriate consideration of uncertainty organism’s requirements. Habitat on habitat creation, this may entail in the impingement mortality and approaches also have the benefit, when supplementing habitat creation entrainment estimates. VerDate 11 b. What Should Be the Minimum very difficult to conduct and interpret (1) Quantified and Monetized Baseline Frequencies for Impingement and for use in decisionmaking (see section Impingement and Entrainment Losses Entrainment Compliance Monitoring? VI.A.8.b.below). EPA invites comment To evaluate the total economic impact Today’s proposal requires compliance on regulatory approaches that would to fisheries with regard to impingement monitoring as specified by the Director allow Phase II existing facilities to and entrainment losses at an existing in § 125.96, but does not specify incorporate estimates of entrainment facility, the impacts on commercial, minimum sampling frequencies or mortality and survival when recreational, and forage species must be durations. EPA is considering specifying determining compliance with the evaluated. Commercial fishery impacts minimum frequencies for impingement applicable performance standards are relatively easy to value because and entrainment sampling for proposed in § 125.94(b) of today’s commercially caught fish are a determining compliance. EPA invites proposed rule. EPA invites commenters commodity with a market price for the comment on including minimum to submit any studies that document individual species. Recreation fishery sampling frequencies and durations as entrainment survival rates for the impacts are based on benefits transfer follows: for at least two years following technologies used as the basis for methods, applying the results from the initial permit issuance, today’s performance standards and for nonmarket valuation studies. Valuing impingement samples must be collected other technologies. recreational impacts involves the use of willingness-to-pay values for increases at least once per month over a 24 hour 8. What Should Be Included in a period and entrainment samples must in recreational catch rates. The analysis Demonstration To Compare Benefits to of the economic impact of forage species be collected at least biweekly over a 24 Costs? hour period during the primary period losses can be determined by estimating of reproduction, larval recruitment and As part of a Site-Specific the replacement costs of these fish if peak abundance. These samples would Determination of Best Technology they were to be restocked with hatchery need to be collected when the cooling Available specified proposed in fish, or by considering the foregone water intake structure is in operation. § 125.94(c) of today’s proposed rule, a biomass production of forage fish Impingement and entrainment samples Phase II existing facility can attempt to resulting from impingement and would be sufficient in number to give an demonstrate to the Director that the entrainment losses and the accurate representation of the annual costs of compliance with the applicable consequential foregone production of and seasonal impingement and performance standards proposed in commercial and recreation species that entrainment losses for all commercial, § 125.94(b) would be significantly prey on the forage species. Trophic recreational and forage based fish and greater than the benefits of complying transfer efficiency is used to estimate shellfish species and their life stages at with such performance standards at the the value of forage fish in terms of the foregone biomass production and the the Phase II existing facility as site. EPA is considering whether it consequential foregone production of identified in the Impingement Mortality should develop regulatory requirements commercial and recreational species and Entrainment Characterization Study or guidance to outline appropriate that prey upon them. This methodology required under § 125.95(b)(3). Sample methodologies to ensure that a reliable can also incorporate nonuse or passive sets would be of sufficient size to and objective valuation of benefits is values. Nonuse or passive use values adequately address inter-annual derived from the best available include the concepts of existence variation of impingement and information. The elements in the benefit (stewardship) and bequest entrainment losses. Sampling would be assessment guidance would, at a (intergenerational equity) motives to planned to eliminate variation in data minimum, include standards for data value environmental changes. In due to changes in sampling methods. quality, acceptable methodologies, Data would also be collected using Regulatory Impact Analyses, EPA values technical peer review, and public nonuse impacts at 50% of value of the appropriate quality assurance/quality comment. control procedures. recreational use impact. 57 EPA invites EPA invites comment on whether a. What Should Be the Appropriate comment on the inclusion of this more frequent sampling would be Methodology for Benefits Assessment? approach for estimating nonuse or appropriate to accurately assess diel, passive values. Examples of the use of seasonal, and annual variation in EPA believes that a rigorous this method for evaluating benefits are impingement and entrainment losses. environmental and economic analysis provided in the Case Study Document. EPA also invites comment on whether should be performed when a facility EPA notes that in locations where less frequent compliance biological seeks a site-specific determination of fisheries have been depleted by monitoring would be appropriate best technology available due to cumulative and long term impingement (perhaps depending on the technologies significantly greater cost as compared to and entrainment losses from cooling selected and implemented by a facility). the benefits of compliance with the water intake structures, this applicable performance standards. EPA methodology may not be the most 7. How Is Entrainment Mortality and invites comment on which of these appropriate as it may have a tendency Survival Considered in Determining methodologies, or any other, is the most to underestimate the long term benefits Compliance With the Proposed Rule? appropriate for determining a fair associated with technology Today’s proposed rule sets a estimate of the benefits that would implementation. performance standard for reducing occur should the Phase II existing (2) Random Utility Model entrainment rather than reducing facility implement technology to entrainment mortality. EPA choose this comply with the applicable performance The Random Utility Model (RUM) approach because EPA does not have standards. In addition, EPA invites estimates the effect of improved fishing sufficient data to establish performance comment on whether narrative benefits opportunities to determine recreational standards based on entrainment assessments should supplement these 57 methodologies to properly account for Fisher, A. and R. Raucher. 1984. Intrinsic mortality for the technologies used as benefits of improved water quality: Conceptual and the basis for today’s proposal. those benefits which cannot be empirical perspectives. Advances in Applied Micro- Entrainment mortality studies can be quantified and monetized. Economics. 3:37–66. VerDate 11 fishing benefits due to reduced survey might ask how much individuals full capacity, at times when biocides impingement and entrainment. The would be willing to have their were not in use, and at times which may main assumption of this model is that electricity bill increase from their not reflect current entrainment rates at anglers will get greater satisfaction, and utility’s power plants to avoid the the facility. These sampling conditions thus greater economic value, from sites impacts of impingement and may lead to overestimation of where the catch rate is higher. When entrainment on fish and shellfish, as entrainment survival. In addition, the anglers enjoy fishing trips with higher well as impacts on threatened and majority of studies reviewed had very catch rates, they may take more fishing endangered species. One strength of low sample sizes and calculated trips resulting in a greater overall value contingent valuation estimates is that survival for only a few of all species for fishing in the region. This method they include the nonuse values such as entrained. EPA is also concerned that requires information on the option, existence, and bequest values, so entrainment survival estimates were socioeconomic characteristics of anglers adjustments to the estimates to cover based on mortal effects only and did not and their fishing preference in terms of these values are not needed. A weakness address sub-lethal entrainment effects, location and target species, information of this approach is that respondents are which can include changes to on site characteristics that are important asked to value a hypothetical good and organismal growth, development, and determinants of anglers’ behavior, and they do not have to back up their stated reproduction. EPA invites comment on the estimated price of visiting the sites. willingness-to-pay with actual its preliminary review of the data Two models are used for estimating the expenditures. However, this concern quality of entrainment survival studies total economic value of recreational fish can be minimized by placing the provided in Chapter D7. EPA also to anglers, the discrete choice model valuation questions in the context of requests that commenters submit which focuses on the choice of fishing familiar economic transactions (e.g., additional entrainment survival or site by individual anglers and the trip increases in electricity bills). mortality studies for review. participation model which estimates the b. Should Estimates of Entrainment 9. When Could the Director Impose number of trips that an angler will take Mortality and Survival Be Included in More Stringent Requirements? annually. A more thorough description Benefits Assessments? of the RUM can be found in Chapter Proposed § 125.94(e) provides that the A10 of the Case Study Document. The proposed rule language for Phase Director could establish more stringent Examples of its use are provided in II existing facilities does not preclude requirements relating to the location, Chapter 5 of the case studies for the use of estimates of entrainment design, construction, or capacity of a Delaware Bay (Part B), Ohio River (Part mortality and survival when presenting cooling water intake structure at a Phase C) and Tampa Bay (Part F). a fair estimation of the monetary II existing facility than those that would The greatest strength of this model is benefits achieved through the be required based on the proposed that it is able to estimate a theoretically installation of the best technology performance standards in the rule defensible monetary value for available, instead of assuming 100 (§ 125.94(b)), or based on the proposed recreational fishing benefits. The percent entrainment mortality. In EPA’s site-specific determination of best weakness in the model is its view, estimates of entrainment mortality technology allowed under the rule dependence on the availability of survey and survival used for this purpose (§ 125.94(c)), where compliance with data on angler preferences, and the bias should be based on sound scientific the proposed requirements of associated with conducting a survey. studies. EPA believes such studies § 125.94(b) or (c) would not meet the This approach is also limited to should address times of both full facility requirements of applicable Tribal, State estimating recreational benefits only, capacity and peak abundance of or other Federal law. The relevant State and should be used in conjunction with entrained organisms. EPA requests law may include, but is not necessarily another methodology that values comment on whether it is appropriate to limited to, State or Tribal water quality commercial and forage species impacts allow consideration of entrainment standards, including designated uses, and other benefit categories where these mortality and survival in benefit criteria, and antidegradation provisions; are significant. estimates, and if so, should EPA set endangered or threatened species or minimum data quality objectives and habitat protection provisions; and other (3) Contingent Valuation Approach standards for a study of entrainment resource protection requirements. The Stated preference methods attempt to mortality and survival used to support term ‘‘other Federal law’’ is intended to measure willingness-to-pay values a site-specific determination of best denote Federal laws others than section directly. Unlike the revealed preference technology available for minimizing 316(b), and could include, but not be methods, such as the RUM described adverse environmental impact. EPA limited to, the Endangered Species Act, above, that determine values for may decide to specify such data quality 16 U.S.C. 1531 et seq., the Coastal Zone environmental goods and services from objectives and standards either in the Management Act, 16 U.S.C. 1451 et seq., observed behavior, stated preference final rule language or through guidance. the Fish and Wildlife Coordination Act, methods rely on data from surveys that A more thorough discussion of 16 U.S.C. 661 et seq., the Wild and directly question respondents about entrainment survival is provided in Scenic Rivers Act, 16 U.S.C. 1273 et their preferences to measure the value of Chapter D7 of the EBA. In this chapter, seq., and potentially the Magnuson- environmental goods and services. EPA has reviewed a number of Stevens Fishery Conservation and Contingent valuation is one of the most entrainment survival studies (see DCN Management Act, 16 U.S.C. 1801 et seq. well developed of the stated preference 2–017A–R7 in Docket W–00–03). EPA’s See 40 CFR 122.49 for a brief methods. Contingent valuation surveys preliminary review of these studies has description of these and certain other either ask respondents if they would raised a number of concerns regarding laws. Note that these laws may apply to pay a specified amount for a described the quality of data used to develop some federally issued NPDES permits commodity (usually a change in estimates of entrainment survival. independent of this proposed rule. environmental quality) or ask their Specifically, the majority of studies EPA expects that Federal, State, and highest willingness-to-pay for that reviewed collected samples at times of Tribal resource protection agencies will commodity. For example, in the case of low organismal abundance, at times work with Federal and State Directors section 316(b), a contingent valuation when the facility was not operating at and permittees to identify and assess VerDate 11 situations where Federal, State, or stressed or under-populated. EPA also thresholds for triggering the requirement Tribal law might be violated, believes that in some waterbodies, for entrainment controls: (1) 5% of the particularly where such violations heavy fishing pressures have greatly mean flow measured during the involve impacts to species of concern. altered and reduced aquatic spawning season (to be determined by For example, the U.S. Fish and Wildlife communities. EPA anticipates that the average of flows during the Service and the National Marine studies valuing the monetized benefits spawning season, but remaining Fisheries Service implement the of reducing impingement and applicable to non-spawning time Endangered Species Act. Where a entrainment may not identify significant periods); (2) 10% or 15% of the mean NPDES permit for a cooling water intake site-specific benefits in such areas and, annual or spawning season flow; (3) structure would comply with the should one or more permit applicants 25% of the 7Q10; and (4) a species- performance requirements of § 125.94(b) request site-specific determinations of specific flow threshold that would use or (c) but may harm endangered species less-costly best technology available for minimum flow requirements of a or critical habitat, EPA expects the minimizing adverse environmental representative species to determine resource agencies to contribute their impact, a State may not have authority allowable withdrawals from the expertise to the evaluation and to deny such requests. EPA requests waterbody. decisionmaking process. comment on whether recovery of 11. State or Tribal Alternative EPA is considering whether to aquatic communities in such Requirements That Achieve Comparable establish additional criteria for when waterbodies might be delayed by use of Environmental Performance to the the Director could establish more the significantly greater cost-to-benefit Regulatory Standards Within a stringent requirements. EPA requests test proposed today. EPA requests Watershed comment on specifying that more comment on an regulatory alternative stringent requirements would be that would explicitly allow the Director In § 125.90, today’s proposal includes appropriate when compliance with the to require more stringent technologies or an alternative where an authorized State applicable requirements in § 125.94(b) measures where not doing so would or Tribe may choose to demonstrate to and (c) would (1) result in unacceptable delay recovery of an aquatic species or the Administrator that it has adopted effects on migratory and/or sport or community that fish and wildlife alternative regulatory requirements that commercial species of concern to the agencies are taking active measures to will result in environmental Director; and (2) not adequately address restore, such as imposing significant performance within a watershed that is cumulative impacts caused by multiple harvesting restrictions. comparable to the reductions in intakes or multiple stressors within the impingement mortality and entrainment waterbody of concern. Unacceptable 10. Discussion of the 5% Flow that would otherwise be achieved under effects on sport or commercial species of Threshold in Freshwater Rivers § 125.94. If a State or Tribe can concern might include a significant The withdrawal threshold is based on successfully make this demonstration, reduction in one or more such species the concept that, absent any other the Administrator is to approve the due to direct or indirect effects of one controls, withdrawal of a unit volume of State or Tribe’s alternative regulatory or more cooling water intake structures. water from a waterbody will result in requirements. Examples of unacceptable effects on the entrainment of an equivalent unit of EPA is proposing that such alternative migratory species of concern might aquatic life (such as eggs and larval requirements achieve comparable include the interference with or organisms) suspended in that volume of performance at the watershed level, disruption of migratory pathways, the water column. This, in turn, is rather than at larger geographic scales or patterns, or behavior. Multiple stressors related to the idea that, absent any at the individual facility-level, to allow within the waterbody of concern might controls, the density of aquatic States and Tribes greater flexibility and, include toxics, nutrients, low dissolved organisms withdrawn by a cooling water potentially, greater efficiency in efforts oxygen, habitat loss, non-point source intake structure is equivalent to the to prevent or compensate for runoff, and pathogen introductions. EPA density of organisms in the water impingement mortality and entrainment is also concerned about the potential column. Thus, if 5% of the mean annual losses, while still coordinating those stress from multiple intakes because flow is withdrawn, it would generally efforts within defined ecological demonstration studies are typically result in the entrainment of 5% of the boundaries where the increased impacts conducted on an individual facility aquatic life within the area of hydraulic are directly offset by controls or basis and do not consider the effects of influence of the intake. EPA believes restoration efforts. Requiring multiple intakes on local aquatic that it is unacceptable to impact more performance level assessment to take organisms. than 5% of the organisms within the place at the watershed level ensures that EPA notes that under section 510 of area of an intake structure. Hence, if the facility mitigation efforts take the the CWA, States already have the facility withdraws more than 5% of the overall health of the waterbody in the authority to establish more stringent mean annual flow of a freshwater river target watershed into account. conditions in any permit in accordance or stream, the facility would be required The Agency requests comment on all with State law. However, this provision to reduce entrainment by 60–90%. EPA aspects of this approach, including the does not apply in cases where EPA is discussed these concepts in more detail appropriate definition of watershed. A the permitting authority. EPA requests and invited comment on the use of this watershed is generally a hydrologically- comment on whether any explicit threshold and supporting documents in delineated geographic area, typically the regulatory provision for more stringent its NODA for the New Facility Rule (66 area that drains to a surface waterbody requirements is needed in light of FR 28863). In today’s proposed rule, or that recharges or overlays ground section 510. EPA again invites comment on use of waters or a combination of both. EPA also notes that States have this threshold for Phase II existing Watersheds can be defined at a variety designated many waterbodies for the facilities and on the supporting of geographic scales. The United States propagation of fish and shellfish that are documents for this threshold that were Geological Survey (USGS) defines not attaining such uses due to pollution, referenced in the NODA. watersheds (hydrologic units) in the and that, in these waters, aquatic EPA also requests comment on the United States at scales ranging from the communities may be significantly following alternative withdrawal drainage areas of major rivers, such as VerDate 11 the Missouri, to small surface drainage environmental performance within each determination to conduct a basins, combinations of drainage basins, watershed. EPA requests comment on Comprehensive Cost Evaluation Study. or distinct hydrologic features. The whether it should instead allow States To adequately demonstrate site- USGS is currently defining additional, to demonstrate comparable specific compliance costs, EPA believes more detailed subdivisions of currently environmental performance at the State that a facility would need to provide existing hydrologic units. (See http:// level, thus allowing States the flexibility engineering cost estimates that are water.usgs.gov/GIS/huc.html.) to focus protection on priority sufficiently detailed to allow review by Watersheds have been defined for other watersheds. a third party. The preferred cost natural resource programs as well (e.g., The standard provided in proposed estimating methodology, in the the Total Maximum Daily Load § 125.90 for evaluating alternate State Agency’s view, is the adaption of program, actions under section 306 of requirements is ‘‘environmental empirical costs from similar projects the Coastal Zone Management Act). performance that is comparable to the tailored to the facility’s characteristics. In general, the appropriate scale at reductions that would otherwise be The submission of generic costs relying which to define a watershed depends on achieved under § 125.94.’’ EPA on engineering judgment should be a program’s goals. EPA believes that the recognizes that it may not always be verified with empirical data wherever watershed scale selected for the possible to determine precisely the possible. In the cases where empirical purposes of determining comparability reductions in impingement and demonstration costs are not available, of a State or Tribal alternative entrainment associated with either the level of detail should allow the costs requirements should allow confident § 125.94 or the alternate State to be reproduced using standard accounting of impingement and requirements, particularly at the construction engineering unit cost entrainment levels at facilities within watershed level or State-wide. databases. These costs should be the watershed and of the results of the Furthermore, alternate State supported by estimates from actions taken to prevent or compensate requirements may provide additional architectural and engineering firms. Further, the engineering assumptions for impingement and entrainment environmental benefits, beyond losses. EPA invites comment on use of forming the basis of the cost estimates impingement and entrainment the USGS eight-digit hydrologic unit should be clearly documented for the reductions, that the State may wish to (generally about the size of a county) as key cost items. factor into its comparability the maximum geographic scale at which The Agency and other regulatory demonstration. However, in making this an authorized State or Tribe could entities have reviewed recent cost demonstration, the State should make a establish alternative regulatory estimates submitted by permittees for reasonable effort to estimate requirements. A State or Tribe could several section 316(b) and 316(a) impingement and entrainment seek to establish the comparability of demonstrations. As discussed in reductions that would occur under alternative regulatory requirements for Chapter X of the Technical § 125.94 and under its alternate as many eight-digit hydrologic units as Development Document, in several it saw fit, but would need to requirements, and should clearly cases where the level of detail provided demonstrate that its alternative identify any other environmental by the permittee was sufficient to afford requirements achieve environmental benefits it is taking into account and a detailed review, EPA has some performance comparable to the explain how their comparability to concerns about the magnitude of these performance standards proposed in impingement and entrainment cost estimates. In other cases, the today’s rule within each such unit. reduction under § 125.94 is being engineering assumptions that formed EPA believes that defining watersheds evaluated. EPA invites comment on the the basis of the cost submissions were at too small a scale might not allow most appropriate scale at which to insufficiently documented to afford a sufficient flexibility. However, EPA is define a watershed to reflect the critical review. Based in part on these concerned that defining watersheds at a variability of the nature of the examples, the Agency emphasizes the very large scale increases the potential ecosystems impacted by cooling water importance of empirically verified and that there will be no direct ecological intake structures within a State or Tribal well documented engineering cost connection between increased impacts area and on methods for ensuring submissions. in one area and compensatory efforts in ecological comparability within The Agency anticipates that the another. watershed-level assessments. EPA also inclusion of a site-specific cost to EPA also recognizes that States invites comment on whether defined benefit test will continue to be of sometimes assign higher priority to watershed boundaries for the purpose of concern to local regulatory entities and protecting some waters over others. This section 316(b) programs should lie the regulated community in light of the may be due to the exceptional entirely within the political boundaries associated burden on permit writers. In environmental, historic, or cultural of a Tribe or State unless adjoining two recent cases, significant burden was value of some waters, or conversely to States and/or Tribes jointly propose to associated with engineering cost a concern with multiple stresses already establish alternative regulatory reviews. In one case, a regional occurring in a watershed. It could also requirements for shared watersheds. authority utilized a significant portion be based on the presence of individual 12. Comprehensive Cost Evaluation of its annual permitting budget (over species of particular commercial, Study $80,000) and significant man-hours recreational, or ecological importance. (approximately 500 hours) to review the For these reasons, States with Section 125.94 of today’s proposal engineering cost estimates submitted in alternative requirements might choose allows a facility to request a site-specific a single permit demonstration. In to provide more protection that would determination of best technology another case, EPA conducted be achieved under § 125.94 in some available for minimizing adverse approximately 200 hours of senior-level watersheds and less protection in environmental impact based on costs review of a single engineering estimate others. Under current language in significantly greater than in EPA’s that had already undergone significant, proposed § 125.90, States could not use record, or significantly greater than site- and costly, local regulatory review. In such an approach because they would specific benefits. Section 125.95(b)(6)(i) each of these cases, the reviewers not be able to demonstrate comparable requires a facility seeking such a identified areas where they believed the VerDate 11 permit applicant had significantly As noted above, however, while 14. Capacity Utilization overestimated costs of a potential concerned about the burden of site- In § 125.94 (b)(2), the Agency compliance option. The level of effort specific section 316(b) determinations, proposes standards for reducing was sufficient to identify the areas of EPA also recognizes the much larger impingement mortality but not concern, but not to develop counter costs of complying with the entrainment when a facility operates proposals for cost estimates. presumptive performance standards and less than 15 percent of the available However, EPA believes it is important believes that some provision for operating time over the course of several to have a site-specific option in the rule situations where costs are significantly years. Fifteen percent capacity to cover cases of exceptionally high greater than benefits is appropriate. EPA utilization corresponds to facility costs and/or minimal benefits. By EPA’s notes that at some sites, impingement operation for roughly 55 days in a year estimates, the costs for some of the and entrainment losses are minimal. In (that is, less than two months). The technologies on which the presumptive such cases it may not make sense to Agency refers to this differentiation performance standards are based may be between facilities based on their several million dollars. In cases where, require a facility to spend a lot of dollars operating time as a capacity utilization due to the site-specific factors, an to comply with presumptive cut-off. The Agency’s record individual facility’s costs are performance requirements. EPA is also demonstrates that facilities operating at significantly higher, or the benefits are concerned about the potential for capacity utilization factors of less than minimal, the additional permitting members of the public who object to the 15 percent are generally facilities of burden hours (upwards of several authority’s site-specific determinations significant age, including the oldest hundred hours) associated with the site- to raise challenges that must be resolved facilities within the scope of the rule. specific estimate may be appropriate. in administrative appeals that can be EPA anticipates that many, if not most, very lengthy and burdensome, followed Frequently, entities will refer to these facilities will choose to comply with the in some cases by judicial challenges. An facilities as peaker plants, though the presumptive standards, but believes that ongoing State study of permitting definition extends to a broader range of for those facilities with exceptionally workloads estimates that appeals of facilities. These peaker plants are less high costs or exceptionally low benefits, NPDES permits issued to major facilities efficient and more costly to operate than other facilities. Therefore, operating the site-specific provisions provide an require 40 hours to resolve in a simple companies generally utilize them only important ‘‘safety valve.’’ case and up to 240 hours for a very when demand is highest and, therefore, EPA invites comment on whether the complex permit. 58 EPA Region 1 economic conditions are favorable. Agency should establish minimum estimates that one year is required to standards for a Comprehensive Cost Because these facilities operate only a resolve a complex administrative fraction of the time compared to other Evaluation Study and on whether such appeal, involving significant amounts of standards should be established by facilities, such as base-load plants, the technical and legal resources. Should peaking plants achieve sizable flow regulation or as guidance only. EPA also the permit appeal be followed by a invites comment on the above reductions over their maximum design judicial challenge, EPA Region 1 discussion of the burden that reviewing annual intake flows. Therefore, the estimates an additional two years or site-specific cost studies poses for concept of an entrainment reduction more of significant investment of permitting authorities and on its belief requirement for such facilities does not that site-specific provisions to address technical and legal resources in one appear necessary. Additionally, the cases of unusually high costs or decision, with additional time and plants typically operate during two unusually low benefits are necessary. resources needed if the initial judicial specific periods: the extreme winter and decision is appealed. 59 Again, however, the extreme summer demand periods. 13. Cost-Benefit Test EPA notes that these burdens may be Each of these periods can, in some EPA requests comment on the cost- small compared to the potential costs of cases, coincide with periods of benefit provision in § 124.95. EPA complying with presumptive abundant aquatic concentrations and/or placed several documents in the docket performance standards. EPA invites sensitive spawning events. However, it for the new facilities final rule (see comments on ways to incorporate site- is generally accepted that peak winter docket items 2–034A and 2–034B) that specific consideration of costs and and summer periods will not be the summarized information from several benefits without undue burden on the most crucial for aquatic organism States on the burdens of site-specific Director. In particular, EPA invites communities on a national basis. decisionmaking. To make section 316(b) comment on decision factors and Of the facilities exceeding the determinations for large power plants in criteria for weighing and balancing capacity utilization cut-off, the median the Southeast in the late 1970s and early these factors that could be included in and average capacity utilization is 50 1980s, EPA estimates a workload of as a regulation or guidance that would percent. As a general rule, steam plants much as 650 person hours per permit streamline the workload for evaluating operate cyclically between 100 percent and $25,000 contract dollars, with an site-specific applications and minimize load and standby. In turn, the intake additional (and potentially larger) the potential for legal challenges. flow rate of a typical steam plant cycles resource investment by State permitting between full design intake flow and authorities. To reissue a permit to the 58 State Water Quality Management Resource standby. Facilities operating with an Salem Nuclear Generating Station, the Model, ver.3.16 (9/00). (See Docket for today’s average capacity utilization of 50 New Jersey Department of Environment proposal.) This is an on-going joint effort between percent would generally withdraw more Protection recently reviewed and states and EPA to develop information on the than three times as much water over the resource ‘‘gap’’ facing State water quality considered a 36-volume permit management programs. The information included course of time than a facility with a application supported by 137 volumes in the model reflects the consensus of the capacity utilization of less than 15. of technical and reference materials. participating states and is intended to reflect Therefore, the capacity utilization cut- The facility filed its application in 1994; averages. off coincides with an approximate flow 59 Communication from Mr. Mark Stein, Office of NJDEP made its decision in 2001. EPA Regional Counsel, US EPA Region I, Boston, MA, reduction, and hence entrainment invites comments on these burden dated January 24, 2002. (See Docket for today’s reduction, of roughly 70 percent as estimates. proposal.) compared to the average facility above VerDate 11 the cut-off, which is within the range of would result in significant adverse Steam electric generating facilities that the performance standard for impacts on local air quality or local have closed-cycle, recirculating cooling entrainment reduction. Of the 539 energy markets. The alternative systems using salt water can reduce facilities for which the Agency has requirement could be no less stringent water usage by 70 to 96 percent when detailed intake flow information, 53 than justified by the significantly greater make-up and blowdown flows are would fall under the capacity utilization cost or the significant adverse impacts minimized. 60 cut-off. Were the Agency to establish the on local air quality or local energy Of the 539 existing steam electric cut-off at less than 20 percent capacity markets. EPA invites comment on these power generating facilities that EPA utilization, an additional 18 facilities provisions and on other factors that believes would potentially be subject to would be subject to the reduced might form the basis for alternative the Phase II existing facility proposed requirements and the comparable flow regulations. rule, 73 of these facilities already have reduction would be roughly 60 percent. The example regulatory language a recirculating wet cooling system (e.g., However, the operating period would presented in section VI.B.3 below does wet cooling towers or ponds). These extend to approximately 75 days (that not include a provision similar to the 40 facilities would meet the requirements is, 2.5 months). Were the Agency to CFR 125.85 in the new facility final rule under this option unless they are establish the cut-off at less than 25 for alternative requirements based on located in areas where the director or percent capacity, 108 of the 539 significant adverse impact on local fisheries managers determine that facilities would be subject to the water resources other than impingement fisheries need additional protection. reduced standards, and the comparable and entrainment. In EPA’s judgement, Therefore, under this option, 466 steam entrainment reduction would be this provision would primarily be used electric power generating facilities roughly 54 percent. For a hypothetical to address water allocation and quantity would be required to meet performance 25 percent capacity utilization cut-off, issues which do not arise in tidal rivers, standards for reducing impingement the operating period would extend to estuaries and oceans, where salinity mortality and entrainment based on a approximately three months. limits competing water uses. reduction in intake flow to a level EPA invites comment on its proposed commensurate with that which can be 1. Intake Capacity Commensurate with approach to regulating Phase II existing attained by a closed-cycle recirculating Closed-Cycle, Recirculating Cooling facilities with limited capacity system. System for All Facilities utilization. EPA specifically invites A closed-cycle recirculating cooling comment on the above alternative EPA considered a regulatory option system is an available technology for thresholds for using capacity utilization that would require Phase II existing facilities that currently have once- to establish performance standard that facilities having a design intake flow 50 through cooling water systems. There address impingement mortality but not MGD or more to reduce the total design are a few examples of existing facilities entrainment. intake flow to a level, at a minimum, converting from one type of cooling commensurate with that which can be system to another (e.g., from once- B. Other Technology-Based Options attained by a closed-cycle recirculating through to closed-cycle recirculating Under Consideration cooling system using minimized make- cooling system). Converting to a EPA also considered a number of up and blowdown flows. In addition, different type of cooling water system, other technology-based options for facilities in specified circumstances however, is significantly more regulating Phase II existing facilities. As (e.g., located where additional expensive than the technologies on in the proposed option, any technology- protection is needed due to concerns which the proposed performance based options considered below would regarding threatened, endangered, or standards are based (generally by a allow for voluntary implementation of protected species or habitat; migratory, factor of 10 or greater) and significantly restoration measures by facilities that sport or commercial species of concern) more expensive that designing new choose to reduce their intake flow to a would have to select and implement facilities to run on recirculating level commensurate with performance design and construction technologies to systems. EPA has identified four power requirements. Thus, under these minimize impingement mortality and plants that would be regulated by options, facilities would be able to entrainment. This option does not today’s proposal that have converted implement restoration measures that distinguish between facilities on the from once-through to closed-cycle would result in increases in fish and basis of the waterbody from which they recirculating cooling systems. Three of shellfish if a demonstration of withdraw cooling water. Rather, it these facilities—Palisades Nuclear Plant comparable performance is made for would ensure that the same stringent in Michigan, Jefferies Coal in South species of concern identified by the controls are the nationally applicable Carolina, and Canadys Steam in South Director in consultation with national, minimum for all waterbody types. This Carolina— converted from once-through State, and Tribal fish and wildlife is the regulatory approach EPA adopted to closed-cycle recirculating cooling management agencies with for new facilities. systems after significant periods of responsibility for aquatic resources Reducing the cooling water intake operation utilizing the once-through potentially affected by the cooling water structure’s capacity is one of the most system. The fourth facility—Pittsburg intake structure. effective means of reducing entrainment Unit 7—is not a full conversion in that Similarly, any technology-based (and impingement). For the traditional it never operated with its once-through options considered also would allow steam electric utility industry, facilities system. In this case, the ‘‘conversion’’ facilities to request alternative located in freshwater areas that have occurred just prior to construction, after requirements that are less stringent than closed-cycle, recirculating cooling water initial design of the once-through those specified, but only if the Director systems can, depending on the quality system design and power plant had determines that data specific to the of the make-up water, reduce water use facility indicate that compliance with by 96 to 98 percent from the amount 60 The lower range would be appropriate where the relevant requirement would result in they would use if they had once-through State water quality standards limit chloride to a maximum increase of 10 percent over background compliance costs significantly greater cooling water systems, though many of and therefore require a 1.1 cycle of concentraction. than those EPA considered in these areas generally contain species The higher range may be attained where cycles of establishing the requirement at issue, or that are less susceptible to entrainment. concentration up to 2.0 are used for the design. VerDate 11 occurred. A brief description of these costs of such conversions. According to rivers and streams to impacts from conversions follows. The Technical EPA’s cost estimates, capital costs for entrainment from cooling water intake Development Document for the individual high-flow plants to convert structures. Proposed Section 316(b) Phase II to wet towers generally ranged from 130 Under this alternative option, Existing Facilities Rule provides to 200 million dollars, with annual facilities that operate at less than 15 additional detail. operating costs in the range of 4 to 20 percent capacity utilization would, as in The Palisades Nuclear Plant. Located million dollars. EPA estimates that the the proposed option, only be required to in Covert, Michigan, the Palisades total annualized post-tax cost of have impingement control technology. Nuclear Plant is a 812 MW (nameplate, compliance for this option is Facilities that have a closed-cycle, steam capacity) facility with a approximately $2.26 billion. Not recirculating cooling system would pressurized water reactor, utilizing a included in this estimate are 9 facilities require additional design and mechanical draft wood cooling tower to that are projected to be baseline construction technologies to increase condense the steam load of the plant. closures. Including compliance costs for the survival rate of impinged biota or to The reactor began operation in 1972 these 9 facilities would increase the further reduce the amount of entrained utilizing a once-through cooling system total cost of compliance with this option biota if the intake structure was located and subsequently converted to a closed- to approximately $2.32 billion. EPA also within an ocean, tidal river, or estuary cycle, recirculating system at the has serious concerns about the short where there are fishery resources of beginning of 1974. term energy implications of a massive concern to permitting authorities or Canadys Steam Plant. This 490 MW concurrent conversion and the potential fishery managers. (nameplate, steam capacity) coal-fired for supply disruptions that it would Facilities with cooling water intake facility with three generating units is entail. EPA requests comment on its structures located in a freshwater located in Colleton County, South decision not to base best technology (including rivers and streams, the Great Carolina. The first unit initially came available for all Phase II existing Lakes and other lakes) would have the online in 1962, the second in 1964, and facilities on closed-cycle, recirculating same requirements as under the the third in 1967. All three units technology. proposed rule. If a facility chose to operated with a once-through cooling The estimated annual benefits (in comply with Track II, then the facility water system for many years. The $2001) for requiring all Phase II existing would have to demonstrate that Canadys Steam plant was converted facilities to reduce intake capacity alternative technologies would reduce from a once-through to a closed-cycle commensurate with the use of closed- impingement and entrainment to levels recirculating cooling system in two cycle, recirculating cooling systems are comparable to those that would be separate projects. Unit 3 (218 MW) was $83.9 million per year and $1.08 billion achieved with a closed-loop first converted in 1972. Units 1 and 2, for entrainment reductions. recirculating system (90% reduction). If both with nameplate capacities of 136 such a facility chose to supplement its MW, were converted from a once- 2. Intake Capacity Commensurate with alternative technologies with restoration through to a closed-cycle, recirculating Closed-Cycle, Recirculating Cooling measures, it would have to demonstrate cooling system in 1992. Systems Based on Waterbody Type the same or substantially similar level of Jefferies Coal Units 3 & 4. Located in EPA also considered an alternate protection. (For additional discussion Moncks Corner, South Carolina, this technology-based option in which see the new facility final rule 66 FR facility has a combined, coal-fired closed-cycle, recirculating cooling 65256, at 65315 columns 1 and 2.) capacity of 346 MW (nameplate, steam). systems would be required for all EPA has estimated that there are 109 The coal units came online in 1970 and facilities on certain waterbody types. facilities located on oceans, estuaries, or operated for approximately 15 years Under this option, EPA would group tidal rivers that do not have a closed utilizing once-through cooling. After the waterbodies into the same five cycle recirculating system and would be Army Corps of Engineers re-diverted the categories as in today’s proposal: (1) required to meet performance standards Santee Cooper River, thereby limiting Freshwater rivers or streams, (2) lakes or for reducing impingement mortality and the plant’s available water supply, the reservoirs, (3) Great Lakes, (4) tidal entrainment based on a reduction in cooling system was converted from rivers or estuaries; and (5) oceans. intake flow to a level commensurate once-through to recirculating towers. Because oceans, estuaries and tidal with that which can be attained by a The plant conducted an empirical rivers contain essential habitat and closed-cycle recirculating system. The energy-penalty study over several years nursery areas for the vast majority of other 430 facilities would be required to to determine the economic impact of the commercial and recreational important meet the same performance standards in cooling system conversion. species of shell and fin fish, including today’s proposal. Pittsburg Power Plant, Unit 7. Located many species that are subject to The potential environmental benefits in Contra Costa County, California, this intensive fishing pressures, these of this option have been estimated at 750 MW (nameplate, gas-fired steam) waterbody types would require more $87.8 million and $1.24 billion for unit was designed and planned with a stringent controls based on the entrainment reductions annually. once-through cooling water system. performance of closed-cycle, Although this option is estimated (a full However, late in the construction recirculating cooling systems. EPA cost analysis was not done for this process, the plant switched to a closed- discussed the susceptibility of these option) to be less expensive at a national cycle, recirculating cooling system with waters in a Notice of Data Availability level than requiring closed-cycle, a mechanical draft cooling tower. The (NODA) for the new facility rule (66 FR recirculating cooling systems for all system utilizes the condenser, conduit 28853, May 25, 2001) and invited Phase II existing facilities, EPA is not system, and circulating pumps comment on documents that may proposing this option. Facilities located originally designed for the once-through support its judgment that these waters on oceans, estuaries, and tidal rivers cooling water system. are particularly susceptible to adverse would incur high capital and operating EPA did not select closed-cycle, impacts from cooling water intake and maintenance costs for conversions recirculating cooling systems as the best structures. In addition, the NODA of their cooling water systems. technology available for existing presented information regarding the low Furthermore, since impacted facilities facilities because of the generally high susceptibility of non-tidal freshwater would be concentrated in coastal VerDate 11 regions, there is the potential for short (vi) The requirements of (b)(7) or (c) if your located in a freshwater river or stream, you term energy impacts and supply cooling water intake structure is located in an must comply with paragraphs (b)(3)(i) or (ii) disruptions in these areas. EPA also ocean. as follows: invites comment on this option. (2) In addition to meeting the requirements (i) If your total design intake flow is equal of (b) or (c), the owner or operator of an to or less than 5 percent of the source water 3. Intake Capacity Commensurate With existing steam electric power generating annual mean flow, you must select and Closed-Cycle, Recirculating Cooling facility must meet any more stringent implement design and construction System Based on Waterbody Type and requirements imposed under (d). technologies or operational measures to Proportion of Waterbody Flow (b) Track I Requirements. Based on the reduce impingement mortality by 80 to 95% design characteristics of your facility and for all life stages of fish and shellfish; or EPA is also considering a variation on cooling water intake structure(s) you must (ii) If your total design intake flow is the above approach that would require meet the requirements of paragraphs (b)(1) greater than 5 percent of the source water only facilities withdrawing very large through (10). annual mean flow, you must select and amounts of water from an estuary, tidal (1) Requirements for Facilities With a implement design and construction river, or ocean to reduce their intake Capacity Utilization Rates Less Than 15 technologies or operational measures to Percent. If you own or operate an existing reduce impingement mortality by 80 to 95% capacity to a level commensurate with facility with a cooling water intake structure and entrainment by 60 to 90% for all life that which can be attained by a closed- that has a capacity utilization rate less than stages of fish and shellfish. cycle, recirculating cooling system. 15 percent, you must select and implement (4) Requirements for Cooling Water Intake For example, for facilities with design and construction technologies or Structures Located in Lakes (Other Than one cooling water intake structures located operational measures to reduce impingement of the Great Lakes) or Reservoirs. If you own in a tidal river or estuary, if the intake mortality by 80 to 95% for fish and shellfish. or operate an existing facility with a cooling flow is greater than 1 percent of the (2) Requirements for Cooling Water Intake water intake structure located in a lake (other source water tidal excursion, then the Structures that Withdraw Water for Closed- than one of the Great Lakes) or reservoir, you facility would have to meet standards Cycle, Recirculating Systems Only. If you must comply with paragraphs (b)(4)(i) and for reducing impingement mortality and own or operate a cooling water intake (ii) as follows: structure that withdraws water from an (i) Your total design intake flow must not entrainment based on the performance estuary, tidal river, or ocean for a closed- disrupt the natural thermal stratification or of wet cooling towers. These facilities cycle, recirculating system only, you must turnover pattern (where present) of the would have the choice of complying comply with the requirements in paragraphs source water except in cases where the with Track I or Track II requirements. If (b)(2)(i) and (ii) as follows: disruption is determined to be beneficial to a facility on a tidal river or estuary has (i) Impingement Design and Construction the management of fisheries for fish and intake flow equal to or less than 1 Technologies or Operational Measures. You shellfish by any fisheries management percent of the source water tidal must select and implement design and agency(ies); and excursion, the facility would only be construction technologies or operational (ii) You must select and implement design required to meet the performance measures to minimize impingement mortality and construction technologies or operational for fish and shellfish if: measures to reduce impingement mortality standards in the proposed rule. These (A) There are threatened or endangered or by 80 to 95% for fish and shellfish. standards are based on the performance otherwise protected Federal, State, or Tribal (5) Requirements for Cooling Water Intake of technologies such as fine mesh species, or critical habitat for these species, Structures Located in Estuaries or Tidal screens and traveling screens with well- within the hydraulic zone of influence of the Rivers. If you own or operate an existing designed and operating fish return cooling water intake structure; or facility with a cooling water intake structure systems. The more stringent, closed- (B) There are migratory and/or sport or located in an estuary or tidal river you must cycle, recirculating cooling system commercial species of impingement concern comply with paragraphs (b)(5)(i) or (ii) as based requirements would also apply to to the Director or any fishery management follows: a facility that has a cooling water intake agency(ies), which pass through the (i) If your total design intake flow over one hydraulic zone of influence of the cooling tidal cycle of ebb and flow is equal to or less structure located in an ocean with an water intake structure; or than one (1) percent of the volume of the intake flow greater than 500 MGD. (C) It is determined by the Director or any water column within the area centered about Regulatory language implementing fishery management agency(ies) that the the opening of the intake with a diameter the Waterbody Type and Intake facility contributes unacceptable stress to the defined by the distance of one tidal excursion Capacity Based Option could read as protected species, critical habitat of those at the mean low water level, you must select follows: species, or species of concern. and implement design and construction (ii) Entrainment Design and Construction technologies or operational measures to (a)(1) The owner or operator of an existing Technologies or Operational Measures. You reduce impingement mortality by 80 to 95% steam electric power generating facility must must select and implement design and and entrainment by 60 to 90% for all life comply with: (i) The requirements of (b)(1) if your construction technologies or operational stages of fish and shellfish; or cooling water intake structure has a measures to minimize entrainment for (ii) If your total design intake flow over one utilization rate less than 15 percent; entrainable life stages of fish and shellfish if: tidal cycle of ebb and flow is greater than one (i) The requirements of (b)(2) if your (A) There are threatened or endangered or (1) percent of the volume of the water cooling water intake structure withdraws otherwise protected Federal, State, or Tribal column within the area centered about the water for use in a closed-cycle, recirculating species, or critical habitat for these species, opening of the intake with a diameter defined system; within the hydraulic zone of influence of the by the distance of one tidal excursion at the (ii) The requirements of (b)(3) if your cooling water intake structure; or mean low water level, you must meet the cooling water intake structure is located in a (B) There are or would be undesirable requirements in paragraphs (b)(5)(ii)(A) or freshwater river or stream; cumulative stressors affecting entrainable life (B): (iii) The requirements of (b)(4) if your stages of species of concern to the Director (A) Reduce your intake flow to a level cooling water intake structure is located in a or any fishery management agency(ies), and commensurate with that which can be lake (other than one of the Great Lakes) or it is determined by the Director or any fishery attained by a closed-cycle recirculating reservoir; management agency(ies) that the facility system and select and implement design and (iv) The requirements of (b)(5) or (c) if your contributes unacceptable stress to these construction technologies or operational cooling water intake structure is located in an species of concern. measures as follows: estuary or tidal river; (3) Requirements for Cooling Water Intake (1) Impingement Design and Construction (v) The requirements of (b)(6) if your Structures Located in Freshwater Rivers or Technologies or Operational Measures. You cooling water intake structure is located in Streams. If you own or operate an existing must select and implement design and one of the Great Lakes; facility with a cooling water intake structure construction technologies or operational VerDate 11 measures to minimize impingement mortality measures to minimize impingement mortality (3) Restoration Measures. Phase II existing for fish and shellfish if: for fish and shellfish if: facilities complying with the requirements of (i) There are threatened or endangered or (i) There are threatened or endangered or Track II may supplement technologies with otherwise protected Federal, State, or Tribal otherwise protected Federal, State, or Tribal restoration measures that will result in species, or critical habitat for these species, species, or critical habitat for these species, increases in fish and shellfish if you can within the hydraulic zone of influence of the within the hydraulic zone of influence of the demonstrate that they will result in a cooling water intake structure; or cooling water intake structure; or comparable performance for species that the (ii) There are migratory and/or sport or (ii) There are migratory and/or sport or Director, in consultation with national, State commercial species of impingement concern commercial species of impingement concern and Tribal fishery management agencies with to the Director or any fishery management to the Director or any fishery management responsibility for fisheries potentially agency(ies), which pass through the agency(ies), which pass through the affected by your cooling water intake hydraulic zone of influence of the cooling hydraulic zone of influence of the cooling structure, identifies as species of concern. water intake structure; or water intake structure; or (4) In cases where air emissions and/or (iii) It is determined by the Director or any (iii) It is determined by the Director or any energy impacts that would result from fishery management agency(ies) that the fishery management agency(ies) that the reducing your intake flow to a level facility contributes unacceptable stress to the facility contributes unacceptable stress to the commensurate with that which can be protected species, critical habitat of those protected species, critical habitat of those attained by a closed-cycle recirculating species, or species of concern. species, or species of concern. system would result in significant adverse (2) Entrainment Design and Construction (2) Entrainment Design and Construction impacts on local air quality, or significant Technologies or Operational Measures. You Technologies or Operational Measures. You adverse impact on local energy markets, you must select and implement design and must select and implement design and may request alternative requirements. construction technologies or operational construction technologies or operational (5) You must submit the application measures to minimize entrainment for measures to minimize entrainment for information required; entrainable life stages of fish and shellfish if: entrainable life stages of fish and shellfish if: (6) You must implement the monitoring (i) There are threatened or endangered or (i) There are threatened or endangered or requirements specified; otherwise protected Federal, State, or Tribal otherwise protected Federal, State, or Tribal (7) You must implement the record- species, or critical habitat for these species, species, or critical habitat for these species, keeping requirements specified; within the hydraulic zone of influence of the within the hydraulic zone of influence of the cooling water intake structure; or cooling water intake structure; or EPA notes that of these, some (ii) There are or would be undesirable (ii) There are or would be undesirable facilities would likely opt to comply cumulative stressors affecting entrainable life cumulative stressors affecting entrainable life through Track II and estimates that 21 stages of species of concern to the Director stages of species of concern to the Director facilities would select this option. These or any fishery management agency(ies), and or any fishery management agency(ies), and facilities would perform site-specific it is determined by the Director or any fishery it is determined by the Director or any fishery management agency(ies) that the facility management agency(ies) that the facility studies and demonstrate compliance contributes unacceptable stress to these contributes unacceptable stress to these using alternative technologies, perhaps species of concern. species of concern. supplemented by habitat enhancement (B) Comply with the requirements of Track (B) Comply with the requirements of Track or fishery restocking efforts. Assuming II in (c). II in (c). as a high impact scenario that all 51 of (6) Requirements for Cooling Water Intake (8) You must submit the application these facilities install wet cooling Structures Located in One of the Great Lakes. information required; towers, the energy impacts associated If you own or operate an existing facility with (9) You must implement the monitoring with these 51 facilities would comprise a cooling water intake structure located in requirements specified; 0.2 percent of total existing electric one of the Great Lakes you must select and (10) You must implement the record- implement design and construction keeping requirements specified; generating capacity from facilities with technologies or operational measures to (c) Track II Requirements. If you are an an intake flow of 50 MGD or more. The reduce impingement mortality by 80 to 95% existing steam electric power generating environmental impacts associated with and entrainment by 60 to 90% for all life facility with a cooling water intake structure increased air emissions (SO2, NOX, CO2, stages of fish and shellfish. located in an estuary, tidal river, or ocean and Hg) associated with this option (7) Requirements for Cooling Water Intake that chooses to meet the requirements of would be a 0.1 percent increase of Structures Located in an Ocean. If you own Track II in lieu of Track I in (b)(5)(ii) or emissions of these pollutants from the or operate an existing facility with a cooling (b)(7)(ii), you must comply with the total existing electric generators. water intake structure located in an ocean following: you must comply with paragraphs (b)(7)(i) or (1) You must demonstrate to the Director The Nuclear Regulatory Commission (ii) as follows: that the technologies, operational measures, estimates that a steam-electric plant (i) If your total design intake flow is less and supplemental restoration measures utilizing a once-through cooling system than 500 MGD, you must select and employed will reduce the level of adverse would consume approximately 40 implement design and construction environmental impact from your cooling percent less water than a comparably technologies or operational measures to water intake structures to a level comparable sized plant equipped with recirculating reduce impingement mortality by 80 to 95% to that which you would achieve were you wet cooling towers because a wet and entrainment by 60 to 90% for all life to reduce your intake flow to a level stages of fish and shellfish; or commensurate with that which can be cooling tower uses a small amount of (ii) If your total design intake flow is equal attained by a closed-cycle recirculating water many times and evaporates most to, or greater than 500 MGD, you must meet system. of this water to provide its cooling the requirements in paragraphs (b)(7)(ii)(A) (2) Except as specified in subparagraph (which can sometimes be seen as a or (B): (c)(4) below, your demonstration must white vapor plume). In contrast, a once- (A) Reduce your intake flow to a level include a showing that the impacts to fish through cooling system uses a much commensurate with that which can be and shellfish, including important forage and larger volume of water, one time. While attained by a closed-cycle recirculating predator species, within the watershed will no cooling water evaporates directly to system and select and implement design and be comparable to those which would result the air, once the heated water is construction technologies or operational if you were to reduce your intake flow to a measures as follows: level commensurate with that which can be discharged back into the waterbody, (1) Impingement Design and Construction attained by a closed-cycle recirculating some evaporation occurs. Thus, in some Technologies or Operational Measures. You system. This showing may include areas, conversion to closed-cycle must select and implement design and consideration of impacts other than cooling could raise water quantity construction technologies or operational impingement mortality and entrainment. issues. VerDate 11 Based on an analysis of data collected EXHIBIT 4.—WATERBODY/CAPACITY- cooling towers-based performance through the detailed industry BASED OPTION (FACILITY LEVEL) standard for all facilities located on questionnaire and the short technical oceans, estuaries and tidal rivers, the cost for facilities to meet these standards questionnaire, EPA estimates there are Annualized cost-to- All Percent potentially 109 Phase II existing revenue ratio phase II of total could be substantial if they installed a facilities located on estuaries, tidal phase II cooling tower. Under this option, EPA rivers, or oceans which may incur < 0.5 % ...... 355 65 would provide an opportunity to seek capital cost under this option. Of these 0.5–1.0 ...... 60 11 alternative requirements to address 109 facilities, EPA estimates that 51 1.0–3.0% ...... 57 10 locally significant air quality or energy would exceed the applicable flow > 3.0 % ...... 67 12 impacts. EPA notes that the incremental threshold and be required to meet Baseline Closure ...... 9 2 costs of this option relative to the performance standards for reducing n/a ...... 1 0 proposed option ($413 million) significantly outweigh the incremental impingement mortality and entrainment Total ...... 550 100 based on a reduction in intake flow to benefits ($146 million). While EPA is not proposing this option, EPA is a level commensurate with that which Similar to the preferred option, EPA considering it for the final rule. To can be attained by a closed-cycle estimates that the compliance costs for facilitate informed public comment, recirculating system. Of the 58 facilities the waterbody/capacity-based option EPA has drafted sample rule language estimated to fall below the applicable would also be low compared to firm- reflecting this option (see above). EPA flow threshold, 10 facilities already level revenues. Of the 131 unique parent invites comment on this alternative meet these performance standards and entities that own the facilities subject to technology based option for establishing would not require any additional this rule, 108 entities would incur best technology available for controls, whereas 48 facilities would compliance costs of less than 0.5 minimizing adverse environmental require entrainment or impingement percent of revenues; 12 entities would impacts from cooling water intake controls, or both. Because this option incur compliance costs of between 0.5 structures at Phase II existing facilities. would only require cooling tower-based and 1 percent of revenues; 6 entities performance standards for facilities would incur compliance costs of 4. Impingement Mortality and located on tidal rivers, estuaries or between 1 and 3 percent of revenues; Entrainment Controls Everywhere oceans where they withdraw saline or and three entities would incur Under an additional alternative being brackish waters, EPA does not believe compliance costs of greater than 3 considered, EPA would establish that this option would raise any percent of revenues. Two entities only national minimum performance significant water quantity issues. own facilities that are estimated to be requirements for the location, design, Total annualized post-tax cost of baseline closures. The estimated construction, and capacity of cooling compliance for the waterbody/capacity- annualized facility compliance costs for water intake structures based on the use this option represent between 0.001 and based option is approximately $585 of design and construction technologies 5.4 percent of the entities’ annual sales million. Not included in this estimate that reduce impingement and revenue. Exhibit 5 below summarizes are 9 facilities that are projected to be entrainment at all Phase II existing these findings. baseline closures. Including compliance facilities without regard to waterbody costs for these 9 facilities would type and with no site-specific EXHIBIT 5.—WATERBODY/CAPACITY- increase the total cost of compliance compliance option available. Under this BASED OPTION (FIRM LEVEL) with this option to approximately $595 alternative the Agency would set million. performance requirements based on the Number Percent use of design and construction EPA also examined the annualized Annualized cost-to- of phase revenue ratio II of total technologies or operational measures post-tax compliance costs of the entities phase II that reduce impingement and waterbody/capacity-based option as a entrainment. EPA would specify a range percentage of annual revenues to assess < 0.5 % ...... 108 82 of impingement mortality and the economic practicability of this 0.5–1.0 % ...... 12 9 entrainment reduction that is the same alternative option. This analysis was 1.0–3.0% ...... 6 5 as the performance requirements conducted at the facility and firm levels. > 3.0 % ...... 3 2 Baseline Closure ...... 2 2 proposed in § 125.94(b)(3) (i.e., Phase II The revenue estimates are the same as existing facilities would be required to those used in the analysis in Section Total ...... 131 100 reduce impingement mortality by 80 to VI.A.3 above: facility-specific baseline 95 percent for fish and shellfish, and to projections from the Integrated Planning The results of EPA’s approach to reduce entrainment by 60 to 90 percent Model (IPM) for 2008. The results at the estimating national benefits are $79.86 for all life stages of fish and shellfish). facility level are similar to those of the million per year for impingement However, unlike the proposed option, proposed rule: 355 out of 550 facilities, reduction and $769.0 million annually performance requirements under this or 65 percent, would incur annualized for entrainment reduction. Additional alternative would apply to all Phase II costs of less than 0.5 percent of details of EPA’s economic practicability existing facilities regardless of the revenues; 60 facilities would incur costs and benefits analysis of this and other category of waterbody used for cooling of between 0.5 and 1 percent of options can be found in the Economic water withdrawals. revenues; 57 facilities would incur costs and Benefits Analysis for the Proposed Like the proposed option, the percent of between 1 and 3 percent; and 67 Section 316(b) Phase II Existing impingement and entrainment facilities would incur costs of greater Facilities Rule and the Technical reduction under this alternative would than 3 percent. Nine facilities are Development Document for the be relative to the calculation baseline. estimated to be baseline closures, and Proposed Section 316(b) Phase II Thus, the baseline for assessing for one facility, revenues are unknown. Existing Facilities Rule. performance would be an existing Exhibit 4 below summarizes these While the national costs of this option facility with a shoreline intake with the findings. are lower than those of requiring wet capacity to support once-through VerDate 11 cooling water systems and no intakes and the affected environment Section 125.90 What Are the Purpose and impingement or entrainment controls. and the costs of implementing controls. Scope of This Subpart? In addition, as proposed, a Phase II This approach would be based on the (a) This subpart establishes requirements existing facility could demonstrate view that the location of each power that apply to the location, design, either that it currently meets the plant and the associated intake structure construction, and capacity of cooling water performance requirements or that it design, construction, and capacity are intake structures at existing facilities that would upgrade its facility to meet these unique, and that the optimal have a design intake flow of equal to or requirements. Further, under this combination of measures to reflect best greater than 50 million gallons per day alternative, EPA would set technology- technology available for minimizing (MGD). The purpose of these requirements is based performance requirements, but adverse environmental impact must be to establish the best technology available for minimizing any adverse environmental the Agency would not mandate the use determined on a case-by-case basis. impact associated with the use of cooling of any specific technology. In order to focus public comment, water intake structures. These requirements Unlike the proposed option, this EPA, in consultation with other are implemented through National Pollutant alternative would not allow for the interested Federal agencies, has drafted Discharge Elimination System (NPDES) development of best technology sample regulatory text for a site-specific permits issued under section 402 of the Clean available on a site-specific basis (except approach, which is set forth below. The Water Act (CWA). on a best professional judgment basis). Site-Specific Sample Rule omits (b) This subpart implements section 316(b) This alternative would not base regulatory text on two key subjects: (1) of the CWA for existing facilities that have a design flow of equal to or greater than 50 requirements on the percent of source The definition of adverse environmental water withdrawn or restrict disruption MGD. Section 316(b) of the CWA provides impact; and (2) the components of the that any standard established pursuant to of the natural thermal stratification of analysis that is used to determine the lakes or reservoirs. It also would impose sections 301 or 306 of the CWA and best technology available for applicable to a point source shall require that entrainment performance requirements minimizing adverse environmental on Phase II existing facilities located on the location, design, construction, and impact. Instead, the Sample Rule capacity of cooling water intake structures freshwater rivers or streams, and lakes contains references to the preamble reflect the best technology available for or reservoirs. Finally, under this discussion of these subjects (see minimizing adverse environmental impact. alternative, restoration could be used, § 125.93, definition of ‘‘adverse The process established in this subpart for but only as a supplement to the use of environmental impact’’ and determining the best technology available for design and construction technologies or § 125.94(b)(2), concerning analysis of intake design, location, construction, and operational measures. the best technology available). capacity provides for a case-by-case This alternative would establish clear Regulatory text is not offered on these determination based on the unique, site- performance-based requirements that specific interactions between intakes and the subjects because the various site- are simpler and easier to implement that environment and the costs of implementing specific approaches described in the those proposed and are based on the use controls at existing facilities. discussion following the Sample Rule of available technologies to reduce deal with them in significantly different Section 125.91 Who Is Subject to This adverse environmental impact. Such an Subpart? ways. alternative would be consistent with the (a) This subpart applies to an existing focus on use of best technology required Site-Specific Alternative: Sample Rule facility if it: under section 316(b). Total annualized Sec. (1) Is a point source that uses or proposes post-tax cost of compliance for the 125.90 What are the purpose and scope of to use a cooling water intake structure; modified proposed option is this subpart? (2) Has at least one cooling water intake approximately $191 million. Not 125.91 Who is subject to this subpart? structure that uses at least 25 percent of the included in this estimate are 11 125.92 When must I comply with this water it withdraws for cooling purposes as facilities that are projected to be subpart? specified in paragraph (c) of this section; and baseline closures. Including compliance 125.93 What special definitions apply to (3) Has a design intake flow equal to or costs for these 11 facilities would this subpart? greater than 50 MGD; (b) Use of a cooling water intake structure increase the total cost of compliance 125.94 As an owner or operator of an existing facility, what must I do to includes obtaining cooling water by any sort with this option to approximately $195 of contract or arrangement with an million. The benefits calculated for comply with this subpart? 125.95 As an owner or operator of an independent supplier (or multiple suppliers) reduced impingement under this option existing facility, may I undertake of cooling water if the supplier or suppliers were $64.5 million per year; restoration measures to mitigate adverse withdraw(s) water from waters of the United entrainment reduction benefits were environmental impact? States. Use of cooling water does not include estimated to be $0.65 billion annually. 125.96 Will alternate State requirements obtaining cooling water from a public water and methodologies for determining the system or use of treated effluent that C. Site-Specific Based Options Under best technology available for minimizing otherwise would be discharged to a water of Consideration adverse environmental impact be the U.S. This provision is intended to 1. Sample Site-Specific Rule recognized? prevent circumvention of these requirements 125.97 As an owner or operator of an by creating arrangements to receive cooling EPA also invites comment on site- existing facility, what must I collect and water from an entity that is not itself a point specific approaches for determining the submit when I apply for my reissued source. best technology available for NPDES permit? (c) The threshold requirement that at least minimizing adverse environmental 125.98 As an owner or operator of an 25 percent of water withdrawn be used for impact at existing facilities. In general, existing facility, must I perform cooling purposes must be measured on an a site-specific option is a formal process monitoring? average monthly basis. 125.99 As an owner or operator of an for determining the best technology existing facility, must I keep records and Section 125.92 When Must I Comply With available for minimizing adverse report? This Subpart? environmental impact at particular 125.100 As the Director, what must I do to You must comply with this subpart when facilities that focuses on the site-specific comply with the requirements of this an NPDES permit containing requirements interactions between cooling water subpart? consistent with this subpart is issued to you. VerDate 11 Section 125.93 What Special Definitions Technology Plan, operational measures, and section to the Director when you apply for a Apply to This Subpart? any restoration measures allowed under reissued NPDES permit in accordance with The definitions in Subpart I of Part 125 § 125.95, that are submitted pursuant to 40 CFR 122.21. apply to this subpart. The following § 125.97. This analysis may include use of (b) Biological Survey. (1) The biological definitions also apply to this subpart: risk assessment. [See V.C.5.c below for a survey must include: Adverse Environmental Impact [Reserved; discussion of possible additional components (i) A taxonomic identification and see discussion at V.C.5.a below.] of this analysis.] characterization of aquatic biological Existing facility means any facility that (c) In determining the best technology resources including a determination and both generates and transmits electric power available for minimizing adverse description of the target populations of and any facility that generates electric power environmental impact at an existing facility, concern (those species of fish and shellfish but sells it to another entity for transmission. the Director shall : and all life stages that are most susceptible This definition specifically includes (1) any (1) Minimize impingement mortality for to impingement and entrainment), and a major modification of a facility; (2) any fish and shellfish; description of the abundance and temporal/ addition of a new unit to a facility for (2) Minimize entrainment mortality for spatial characterization of the target purposes of the same industrial operation; (3) entrainable life stages of fish and shellfish; populations based on the collection of a any addition of a unit for purposes of a (3) Take into account non-aquatic sufficient number of years of data to capture different industrial operation that uses an environmental impacts, including energy the seasonal and diel variations (e.g., existing cooling water intake structure but requirements, and impacts on local air spawning, feeding and water column does not increase the design capacity of the quality or water resources; and migration) of all life stages of fish and cooling water intake structure; and (4) any (4) Not require any technologies for shellfish found in the vicinity of the cooling facility that is constructed in place of a location, design, construction or capacity or water intake structure; and facility that has been demolished, but that operational and/or restoration measures the (ii) An identification of threatened or uses an existing cooling water intake costs of which would be significantly greater endangered or otherwise protected Federal, structure whose design intake flow has not than the estimated benefits of such state or tribal species that might be been increased to accommodate the intake of technology or measures. susceptible to impingement and entrainment additional cooling water. (d) The Director may establish more by the cooling water intake structure(s); and Section 125.94 How Will Requirements stringent requirements as best technology (iii) A description of additional chemical, Reflecting Best Technology Available for available for minimizing adverse water quality, and other anthropogenic Minimizing Adverse Environmental Impact environmental impact if the Director stresses on the source water body based on Be Established for My Existing Facility? determines that your compliance with the available information. requirements of paragraph (c) would not (2) As provided in § 125.94(a)(2) and (d)(1), (a)(1) Except as provided in paragraph ensure compliance with State or other biological survey data previously produced (a)(2) of this section, an owner or operator of Federal law. to demonstrate compliance with section an existing facility covered by this subpart (e) The owner or operator of an existing 316(b) of the CWA may be used in the must conduct a baseline biological survey facility must comply with any permit biological survey if the data are and provide any other information specified requirements imposed by the Director representative of current conditions. in § 125.97 that the Director concludes is pursuant to § 125.100(b) of this section. (c) Design and Construction Technology necessary for determining the magnitude of Plan. (1) The Design and Construction any adverse environmental impact occurring Section 125.95 As an Owner or Operator of Technology Plan must explain the at the facility. an Existing Facility, May I Undertake technologies and measures you have selected (2) A previously conducted section 316(b) Restoration Measures To Mitigate Adverse demonstration may be used to determine Environmental Impact? to minimize adverse environmental impact whether the location, design, construction based on information collected for the (a) An owner or operator of an existing biological survey. and capacity of the facility’s cooling water facility may undertake restoration measures intake structure reflect best technology (2) In-place technologies implemented (such as habitat improvement and fish previously to comply with section 316(b), available for minimizing adverse stocking) that will mitigate adverse environmental impact if it reflects current and information regarding their effectiveness, environmental impact from the facility’s may be included in the Design and biological conditions in the water body and cooling water intake structure. the current location and design of the cooling Construction Technology Plan for an existing (b) In determining whether adverse facility. water intake structure. A previously environmental impact is minimized, the conducted section 316(b) demonstration (3) Design and engineering calculations, Director must take into account any drawings, maps, and costs estimates generally would reflect current conditions or voluntary restoration measures. circumstances if: supporting the technologies and measures (i) The previous section 316(b) Section 125.96 Will Alternative State you have selected to minimize adverse demonstration used data collection and Requirements and Methodologies for environmental impact. analytical methods consistent with guidance Determining the Best Technology Available (d) Operational Measures. Operational or requirements of the permitting agency for Minimizing Adverse Environmental measures that may be proposed include, but and/or the Administrator; Impact Be Recognized? are not limited to, seasonal shutdowns or (ii) The available evidence shows that there Notwithstanding any other provisions of reductions in flow and continuous operation have been no significant changes in the this subpart, if a State demonstrates to the of screens. populations of critical aquatic species; and Administrator that it has adopted alternative (e) Restoration Measures. If you propose to (iii) The owner or operator can show there regulatory requirements that will result in use restoration measures to minimize adverse have been no significant changes in the environmental performance within a environmental impact as allowed in § 125.95, location, design, construction, and capacity watershed that is comparable to the you must provide the following information of the facility’s cooling water intake structure reductions of impingement mortality and to the Director for review: that would lead to a greater adverse entrainment that would otherwise be (1) Information and data to show that you environmental impact. achieved under this subpart, the have coordinated with the appropriate fish (b) The determination of best technology Administrator shall approve such alternative and wildlife management agency; available for minimizing adverse regulatory requirements. (2) A plan that provides a list of the environmental impact required by paragraph measures you have selected and will (c) of this section may be based on: Section 125.97 As an Owner or Operator of implement and how you will demonstrate (1) A previously conducted section 316(b) an Existing Facility, What Must I Collect and that your restoration measures will maintain demonstration that is shown to be still valid Submit When I Apply for My Reissued the fish and shellfish in the water body to the in the current circumstances, as described in NPDES Permit? level required to offset mortality from paragraph (a)(2) of this section; or (a) As an owner or operator of an existing entrainment and impingement; and (2) An analysis of best technology available facility covered by this part, you must submit (3) Design and engineering calculations, based on the Design and Construction the information required by § 125.94 and this drawings, maps, and costs estimates VerDate 11 supporting the proposed restoration (2) For each subsequent permit renewal for 316(b) have been made on a case-by- measures. a covered facility, the Director must review case, site-specific basis. EPA published Section 125.98 As an Owner or Operator of the application materials and monitoring guidance addressing section 316(b) an Existing Facility, Must I Perform data to determine whether requirements, or implementation in 1977. See Draft Monitoring? additional requirements, for design and construction technologies or operational Guidance for Evaluating the Adverse (a) Following issuance of an NPDES measures should be included in the permit, Impact of Cooling Water Intake permit, an owner or operator of an existing as provided in paragraph (b) of this section. Structures on the Aquatic Environment: facility must submit to the Director a program (b) Permitting Requirements. (1) Section Section 316(b) P.L. 92–500 (U.S. EPA, for monitoring that will be adequate to verify 316(b) requirements are implemented for a 1977). This guidance describes the that the location, design, construction, and facility through an NPDES permit. As the capacity of the cooling water intake structure studies recommended for evaluating the Director, you must: impact of cooling water intake reflect the best technology available for (i) Determine whether the location, design, minimizing adverse environmental impact. construction and capacity of the cooling structures on the aquatic environment, (b) The Director may require modifications water intake structure at the existing facility and it establishes a basis for of the monitoring program proposed by the reflects best technology available for determining the best technology owner or operator based on, but not limited minimizing adverse environmental impact, available for minimizing adverse to, consideration of the following factors: based on the information provided under (1) Whether or not the facility has been environmental impact. The 1977 § 125.94(a) and § 125.97 and any other determined to cause adverse environmental Section 316(b) Draft Guidance states, available, relevant information; and impacts under § 125.100; ‘‘The environmental-intake interactions (2) The types of modifications and (ii) If the location, design, construction and in question are highly site-specific and capacity of the cooling water intake structure restoration that are required in the NPDES the decision as to best technology permit under § 125.100; at the existing facility does not reflect best technology available for minimizing adverse available for intake design, location, (3) The amount and quality of the data or construction, and capacity must be information available on the water body environmental impact, specify the health and quality of the fishery; and requirements and conditions for the location, made on a case-by-case basis.’’ (Section (4) The stability or flux in the design, construction, and capacity of the 316(b) Draft Guidance, U.S. EPA, 1977, environmental factors that influence cooling water intake structure(s) that must be p. 4). This case-by-case approach also is biological response in the water body. included in the permit for minimizing consistent with the approach described (c) The monitoring program for an existing adverse environmental impact. This in the 1976 Development Document determination must be based on information facility that the Director has determined is referenced in the remanded regulation. not causing adverse environmental impact provided under § 125.94 and § 125.97 and must provide for monitoring sufficient for the any other available, relevant information. The 1977 Section 316(b) Draft Director to make the subsequent 5-year (2) (i) Before issuing an NPDES permit Guidance recommends a general process permit decision. containing section 316(b) requirements, the for developing information needed to (d) The monitoring program for an existing Director must consult with and consider the support section 316(b) decisions and facility that the Director has determined to views and any information provided by presenting that information to the cause adverse environmental impact must interested fish and wildlife management provide for monitoring sufficient to agencies. permitting authority. The process demonstrate that the modifications to facility (ii) If any fish and wildlife management involves the development of a site- operations and intake technology and any agency having jurisdiction over the water specific study of the environmental restoration measures included in the NPDES body used for cooling water withdrawal effects associated with each facility that permit have been effective for minimizing determines that the cooling water intake uses one or more cooling water intake adverse environmental impact. The structure(s) of an existing facility contributes structures, as well as consideration of monitoring must begin during the first year to unacceptable stress to aquatic species or that study by the permitting authority in following implementation of the their habitat, the fish and wildlife determining whether the facility must modifications and restoration measures, and management agency may recommend design, must continue until the Director is satisfied construction, or operational changes to the make any changes to minimize adverse that adverse environmental impact caused by Director that will minimize that stress. environmental impact. Where adverse the facility’s cooling water intake has been (c) Monitoring Requirements. At a environmental impact is occurring and minimized. minimum, the Director must ensure that the must be minimized by application of Section 125.99 As an Owner or Operator of permit requires the permittee to perform the best technology available, the 1977 an Existing Facility, Must I Keep Records and monitoring required in § 125.98. You may guidance suggests a ‘‘stepwise’’ Report? modify the monitoring program when the approach that considers screening permit is reissued and during the term of the (a) As an owner or operator of an existing systems, size, location, capacity, and permit based on changes in the physical or facility, you must keep records of all the data biological conditions in the vicinity of the other factors. used to complete the permit application and show compliance with the requirements in cooling water intake structure. Although the Draft Guidance the permit and any compliance monitoring The Agency invites comment on the describes the information to be data for a period of at least three (3) years above framework as an appropriate developed, key factors to be considered, from the date of permit issuance. approach for implementing section and a process for supporting section (b) The Director may require that these 316(b) as an alternative to today’s 316(b) determinations, it does not records be kept for a longer period. proposed requirements. The Agency establish national standards for best Section 125.100 As the Director, What Must also invites comments on the following technology available to minimize I Do To Comply With the Requirements of site-specific approaches for adverse environmental impact. Rather, This Subpart? implementing section 316(b) on a site- the guidance leaves the decisions on the (a) Permit Applications. As the Director, specific basis within the general appropriate location, design, capacity, you must review materials submitted by the framework set forth in the Sample Rule. and construction of each facility to the applicant under 40 CFR 122.21(r)(3) and permitting authority. Under this § 125.94 before each permit renewal or 2. Site-Specific Alternative Based on framework, the Director determines reissuance. EPA’s 1977 Draft Guidance (1) After receiving the permit application whether appropriate studies have been from the owner or operator of a new facility, Since the Fourth Circuit remanded performed and whether a given facility the Director must determine if the applicant EPA’s section 316(b) regulations in has minimized adverse environmental is subject to the requirements of this subpart. 1977, decisions implementing section impact. VerDate 11 3. The Utility Water Act Group (UWAG) 4. Site-Specific Alternative Suggested by 5. Discussion of Site-Specific Approach Approach PSEG Issues and Associated Questions for Comment The Utility Water Act Group (UWAG), EPA also received a suggested site- an association of more than 100 specific regulatory framework from the The following sections focus on individual electric utility companies Public Service Electricity and Gas several key aspects of any site-specific and three national trade associations of Company (PSEG). The framework approach, specifically requesting electric utilities, provided EPA with a includes three alternative decision- comment on an appropriate definition recommended site-specific regulatory making approaches that would allow of adverse environmental impact and framework, entitled ‘‘316(b) Decision permittees and permit writers to utilize associated decision-making criteria. prior analyses and data that may be Principles for Existing Facilities.’’ a. Determination of Adverse appropriate and helpful, consider UWAG’s recommended approach for Environmental Impact decision making under section 316(b) previous best technology available includes the following components: determinations that were based on these EPA’s 1977 Draft Guidance assumes • A definition of ‘‘Adverse analyses and data, and take into account there will be adverse environmental Environmental Impact; the benefits of prior section 316(b) impact whenever there is entrainment • Use of Representative Indicator implementing actions. The following or impingement ‘‘damage’’ as a result of Species (RIS) for the assessment of summary of the framework suggested by a cooling water intake structure, and adverse environmental impact; PSEG closely tracks PSEG’s submission, focuses study on the magnitude of the impact to determine the appropriate • Making decisions under section which is included in the rulemaking technologies needed to minimize the 316(b) that complement, but do not record. PSEG’s submission states that EPA impact. The evaluation criteria for duplicate, other Federal, state, and local guidance and other precedents have assessing the magnitude of an adverse regulatory programs; identified certain ecological criteria as impact are broad and recommend • Use of de minimis criteria to relevant factors for considering adverse consideration both in terms of absolute exempt small cooling water users that environmental impact, including damage (e.g., numbers of fish) and pose no appreciable risk of causing entrainment and impingement; percentages of populations. Although adverse environmental impact because reductions of threatened, endangered, or the UWAG and PSEG site-specific only a small amount of cooling water is other protected species; damage to approaches contain different definitions withdrawn from a water body at a critical aquatic organisms, including of the term ‘‘adverse environmental location that does not require special important elements of the food chain; impact,’’ there is general agreement protection; • diminishment of a population’s among them that the focus should be on Determination of adverse compensatory reserve; losses to the health of critical aquatic populations environmental impact or its absence populations, including reductions of or ecosystems, rather than on absolute using the facility’s choice of three indigenous species populations, numbers of fish and other aquatic methods, either alone or in commercial fishery stocks, and organisms impinged or entrained by the combination: (1) Use of previously recreational fisheries; and stresses to cooling water intake structure. UWAG conducted section 316(b) overall communities or ecosystems as offered the most detailed and specific demonstrations that are still valid in evidenced by reductions in diversity or recommendations for making a light of current circumstances; (2) use of other changes in system structure or determination of adverse environmental ecological risk assessment by means of function. Many existing section 316(b) impact. demonstration of no appreciable risk of decisions are based upon extensive data (1) EPA’s 1977 Definition of Adverse adverse environmental impact using and analyses pertaining to those factors. Environmental Impact and Examples of conservative decision criteria; or Those factors would remain applicable Its Current Use assessment of risk using a structured for all existing facilities. decision making process consistent with Under PSEG’s recommended In EPA’s 1977 Draft Guidance, EPA’s Ecological Risk Assessment approach, permitting authorities would adverse environmental impact is Guidelines; have the authority to continue to place defined as follows: • A ‘‘maximize net benefits’’ emphasis on the factors they believe are Adverse environmental impact means the approach for selecting the best most relevant to a given situation. For adverse aquatic environmental impact that technology available for minimizing example, when long-term data are occurs whenever there will be entrainment or adverse environmental impact; available that meet appropriate data impingement damage as a result of the • At the option of the permittee, quality standards, and when analyses operation of a specific cooling water intake recognition of voluntary enhancements using appropriate techniques such as structure. The critical question is the such as fish stocking or habitat models that already have been magnitude of any adverse impact which should be estimated both in terms of short improvements; and developed to allow population-level • term and long term impact with respect to (1) Providing data or information with analysis of the potential for adverse absolute damage (number of fish impinged or NPDES permit renewal applications if environmental impact, permit writers percentage of larvae entrained on a monthly new information shows that previously would focus on those adverse or yearly basis); (2) percentage damage conducted section 316(b) environmental impact factors related to (percentage of fish or larvae in existing demonstrations are no longer population-level impacts. In other populations which will be impinged or scientifically valid. situations, especially where permittees entrained, respectively); (3) absolute and These features of UWAG’s do not wish to invest the time and percentage damage to any endangered recommended approach are discussed financial resources necessary for species; (4) absolute and percentage damage to any critical aquatic organism; (5) absolute in the Discussion of Site-Specific biological data gathering and analysis, and percentage damage to commercially Approach Issues and Questions for permitting authorities would have the valuable and/or sport species yield; and (6) Comment that follows. UWAG’s discretion to focus on other factors by whether the impact would endanger submission is included in the applying different decision-making (jeopardize) the protection and propagation rulemaking record. paths. of a balanced population of shellfish and fish VerDate 11 in and on the body of water from which the is scientifically sound and reservoirs, a cooling water intake cooling water is withdrawn (long term environmentally protective because it structure would be considered not to impact). focuses on protecting populations or create a risk of adverse environmental Over the past 25 years, permitting species that are subject to impingement impact if it withdraws no more than 5% agencies have interpreted this definition and entrainment by cooling water intake of either the source water body or the in a variety of ways. Some agencies structures and because it requires that ‘‘biological zone of influence.’’ This consider the absolute number of the level of population protection be criterion would apply only to organisms subjected to impingement adequate to ensure protection of the entrainable life stages. Because it might and entrainment by facility cooling integrity of the ecosystem (community not be appropriate for many RIS to water intakes. Permitting authorities structure and function). However, it consider the entire source water body in that evaluate adverse environmental notes that this definition does not create making this decision, determining the impact by enumerating losses of a ‘‘bright line’’ test based on engineering appropriate flow or volume would be of numbers of fish individuals find this or science. In addition to use of a valid, critical importance. UWAG approach removes much of the previously conducted section 316(b) recommends how the ‘‘biological zone uncertainty associated with evaluating demonstration, UWAG would allow of influence’’ would be determined for effects to species at higher facilities to use two risk assessment different RIS. approaches to make a demonstration of organizational levels such as Biological Criteria populations, communities, or ‘‘no adverse environmental impact.’’ ecosystems. Other permitting authorities The first approach involves Percent Population Loss Criterion: On have focused on evaluating effects on demonstrating that the facility meets freshwater rivers, lakes (other than the populations in determining whether an one or more of a set of conservative Great Lakes), and reservoirs, a facility adverse environmental impact is decision criteria. Under the second would be considered not to create a risk occurring. approach, a facility would cooperate of adverse environmental impact if the with regulators and stakeholders to cooling water intake structure causes (2) An Alternative Definition determine the benchmarks for a risk the combined loss, from entrainment EPA solicits comment on an analysis to determine whether there is and impingement, of (1) no more than alternative definition of ‘‘adverse an appreciable risk of adverse 1% of the population of any harvested environmental impact’’ as follows: environmental impact. RIS and (2) no more than 5% of the Adverse environmental impact means one population of any non-harvested RIS, (a) Protective Decision Criteria for with fractional losses summed over life or more of the following: entrainment and Determining Adverse Environmental impingement of significant numbers of a stages for the entire lake, reservoir, or critical aquatic organisms or percentages of Impact river reach included in the evaluation. aquatic populations; adverse impacts to UWAG recommends protective UWAG explains that the 1%/5% threatened, endangered or other protected decision criteria that it believes are population loss criteria are based in part species, or their designated critical habitat; conservative enough to eliminate the on the recognition that these significant losses to populations, including risk of adverse environmental impact for percentages are small relative to the reductions of indigenous species populations, commercial fishery stocks, and all practical purposes. The inter-annual fluctuations typical of fish recreational fisheries; and stresses to overall recommended physical and biological populations and also small relative to communities or ecosystems as evidenced by decision criteria are as follows: the compensatory responses typical of reductions in diversity or other changes in many species. system structure or function. Physical Criteria No Significant Downward Trend: On Locational Criterion: An existing freshwater rivers, lakes (other than the (3) Discussion of UWAG cooling water intake structure would be Great Lakes), and reservoirs, a cooling Recommendation for Determining considered not to create a risk of water intake structure would be Adverse Environmental Impact adverse environmental impact if it considered to create no risk of adverse UWAG offers the following definition: withdraws water from a zone of a water environmental impact if adequate data Adverse environmental impact is a body that does not support aquatic life collected over a representative period of reduction in one or more representative due to anoxia or other reasons, such as years, including preoperational data, indicator species (RIS) 61 that (1) creates an lack of habitat, poor habitat, or water show no statistically significant unacceptable risk to a population’s ability to quality conditions. downward trend in the population sustain itself, to support reasonably Design Criterion: An existing cooling abundance of RIS. anticipated commercial or recreational water intake structure would not be The foregoing criteria would be harvests, or to perform its normal ecological function and (2) is attributable to operation considered to create a risk of adverse applied independently. Passing a single of the cooling water intake structure. environmental impact if it uses wet criterion could serve as the basis for a closed-cycle cooling or technologies that successful demonstration of no risk of In UWAG’s view, defining adverse achieve a level of protection reasonably adverse environmental impact for a environmental impact in terms of consistent with that achieved by wet facility. If population-based biological ‘‘unacceptable risk’’ combines science closed-cycle cooling. However, wet criteria are used, they would be applied with the judgments society makes about closed-cycle cooling or reasonably independently to each RIS species, and the value of different resources. UWAG consistent protection would be each species would need to meet the argues that this recommended definition considered insufficient if permit writers criteria for the facility to demonstrate no or natural resource agencies identify risk of adverse environmental impact. 61 Drawing on the concept of ‘‘critical aquatic organisms’’in EPA’s 1977 draft guidance, UWAG special local circumstances such as UWAG states that most of these would define a representative indicator species impacts to threatened, endangered, or recommended criteria have limitations (RIS) as a species of commercial or recreational otherwise protected species or areas on their use, such as being limited to importance, a Federal or state threatened or designated for special protection. certain water body types or to use with endangered or specially designated species, an important species for ecological community Proportion of Flow or Volume either impingeable or entrainable structure or function, or on the basis of species and Criterion: On fresh water rivers, lakes organisms, but not both. Some facilities, life stage vulnerability. (other than the Great Lakes), and therefore, might use the criteria for only VerDate 11 some of their RIS and would address the (b) Should the final rule adopt the specific data and information. In PSEG’s remainder through the structured 1977 Draft Guidance approach to view, such prior decisions need not be adverse environmental impact decision defining adverse environmental impact subject to a complete re-evaluation in making process discussed below. as any entrainment or impingement subsequent permit renewal proceedings (b) The Structured Adverse damage caused by a cooling water absent indications that the current Environmental Impact Decision Making intake structure? cooling water intake structure is Process Consistent with EPA Ecological (c) Should the final rule state that any allowing adverse environmental impacts Risk Assessment Guidelines impingement and entrainment is an to occur or that there have been material Under this alternative for determining adverse environmental impact and focus changes in any of the key factors the adverse environmental impact, a facility site-specific assessment on whether that agency relied upon in reaching the prior would work with permit writers, impact is minimized by technologies determination. resource managers, other appropriate already in place or potential changes in technical experts, and stakeholders to technology? Alternatively, should the Under PSEG’s approach, if a cooling determine what constitutes an final rule define adverse environmental water intake structure at an existing ‘‘unacceptable’’ risk of adverse impact in terms of population-level or facility has previously been determined environmental impact in a water body. community-level effects? to employ best technology available The process would be based on EPA’s (d) Should EPA adopt an approach based upon a diligent review of a 1998 Ecological Risk Assessment that makes more explicit use of section 316(b) demonstration that was Guidelines. The key steps would be as threshold determinations of whether conducted in conformance with the follows: adverse environmental impact is • 1977 EPA Guidance, then the existing Stakeholders would be involved in occurring, If so, should EPA adopt any intake would continue to be determined identifying issues of concern caused by or all of the conservative decision to employ best technology available for the cooling water intake structure criteria suggested by UWAG in a final the next permit cycle. The permit relative to RIS. To focus the effort to rule? identify RIS at risk, previous section 316 renewal application would have to (e) Should the structured risk include information sufficient to allow studies, the results of demonstrations assessment decision process that UWAG the permitting agency to determine that: using the criteria discussed above, recommends for determining adverse (1) There has been no material change information on the design and operation environmental impact be adopted? of the facility, water body fisheries b. Use of Previous Section 316(b) in the operation of the facility that management data and plans, and other Demonstration Studies would affect entrainment or relevant water body information could The Sample Site-Specific Rule and impingement; (2) any in-place be used. the PSEG and UWAG approaches would technologies have been properly • The permit writer, with input from all give the permittee an opportunity to operated, maintained, and are not the facility, would then determine what show that a previously conducted allowing losses to occur in excess of the data collection and assessment studies section 316(b) demonstration study was levels the agency considered in its prior are necessary to address the RIS of conducted in accordance with accepted determination; (3) any conservation or concern. Decisions regarding the scope methods and guidance, reflects current mitigation measures included in prior of the assessment would include conditions, and supports decisions permits are in place and are producing identification of RIS; study design, regarding the existence of adverse the intended benefits; (4) the economics sampling methods, locations, and environmental impact and the best of applying a different technology have durations; and analytical methods and/ technology available for minimizing not changed; and (5) data and/or or models to be employed. adverse environmental impact. analyses show that fish species of • The facility and regulators also concern are being maintained or that would identify explicit measurement (1) Sample Site-Specific Rule Approach any declines in those species are not endpoints and criteria for assessing for Using Previous Demonstration adverse environmental impact before Studies attributable to the cooling water intake any studies are conducted. If the studies Sections 125.94(a)(2) and 125.94(c)(1) structure. demonstrate that predetermined of the Sample Rule would permit use of In the Fact Sheet accompanying the endpoints are not exceeded, the intake a previously conducted section 316(b) draft permit, the permitting agency structure would be considered not to demonstration if the previous study was would be required specifically to: (1) cause adverse environmental impact. If performed using data collection and Make a finding of fact that the prior not, the facility would proceed to analytical methods that conformed to section 316(b) determination had been identify best technology available applicable guidance or requirements of based upon a demonstration conducted alternatives or to identify enhancements the permitting agency or EPA and there in conformance with the Agency’s 1977 that would eliminate adverse have been no significant changes to Guidance; and (2) identify the data and environmental impact. either the aquatic populations affected information that the permittee provided by the cooling water intake structure or (4) Questions for Comment on the in support of the reaffirmance of its to the design, construction, or operation Determination of Adverse prior section 316(b) determination. of the facility. The burden would be on Environmental Impact Interested third parties as well as the owner or operator of the facility to Federal, state and interstate resource (a) EPA invites public comment on all show that these conditions were met. aspects of the foregoing approaches to protection agencies (e.g., National defining adverse environmental impact (2) PSEG Recommendation for Using Marine Fisheries Service and the United and for making the preliminary Previous Demonstration Studies States Fish and Wildlife Service) would determination on adverse PSEG would permit use of previous have an opportunity to comment on the environmental impact, and on which section 316(b) determinations that were draft section 316(b) determination and approach should be included if the based upon analysis deemed to be to challenge the final determination if Agency adopts a site-specific approach thorough and based on the appropriate they were aggrieved by the agency’s for the final rule. statutory factors and detailed, site- final decision. VerDate 11 (3) UWAG Recommendation for Using (1) EPA’s Draft 1977 Guidance and (3) Processes Structured on Incremental Previous Demonstration Studies Development Document Cost-Benefit Assessment UWAG also would permit use of a EPA’s draft 1977 draft guidance and EPA solicits comment on whether an previously conducted section 316 development document provide evaluation of the cost-effectiveness (i.e., demonstration if the past demonstration guidance on how to select best the incremental cost to benefit ratio) of cooling water intake structure reflects current biological conditions in technology for minimizing adverse technologies and any operational and/or the water body and the current location, environmental impact but are silent on restoration measures offered by the design, construction, and capacity of the the role of costs and benefits in determining best technology available owner or operator of a facility is an cooling water intake structure. UWAG appropriate component of the analysis argues that many States have developed for minimizing adverse environmental impact. In 1979, the U.S. Court of that would be undertaken in a site- section 316(b) regulatory programs with Appeals for the First Circuit found that specific approach to determining best significant information-gathering cost is an acceptable consideration in technology available for minimizing requirements and that this information section 316(b) determinations. Seacoast adverse environmental impact. The would provide, for many existing Anti-Pollution League v. Costle, 597 UWAG and PSEG recommendations for facilities, a sufficient basis for F.2d 306, 311 (1st Cir. 1979). Over the selecting technologies and other determination of compliance with years, section 316(b) determinations measures based on an evaluation of section 316(b). More specifically, have focused on whether the costs of costs and benefits are discussed below. UWAG’s approach would consider (1) technologies employed would be wholly (A) UWAG Recommendation for a Whether the RIS used in past disproportionate to the environmental Process determinations are still the appropriate gains to be derived from their use. See ones; (2) whether the data collection e.g., Seacoast Anti-Pollution League v. Under the UWAG approach, if the and analytical tools used were adequate Costle; Decision of the General Counsel facility is not able to demonstrate that in light of current circumstances; (3) No. 63 (July 29, 1977); Decision of the its cooling water intake structure is not whether water body biological General Counsel No. 41 (June 1, 1976). causing adverse environmental impact, conditions at the time of the study it would then select and implement the (2) Sample Site-Specific Rule reflect current conditions; (4) whether best technology available. As the first step in choosing best technology the location, design, construction, or The Sample Rule would require that available, a facility would identify capacity of the cooling water intake the analysis of best technology available technology alternatives. It would then structure has been altered since the for minimizing adverse environmental estimate the costs and benefits of the previous section 316(b) demonstration; impact be based on a biological survey alternatives. Relevant benefits typically and (5) other factors that should be of the part of the water body affected by would include preservation of fish and considered if there is reason to believe the cooling water intake structure and a other aquatic life and economic benefits that the previous demonstrations are Design and Construction Technology from recreational and commercial Plan submitted by the permittee, inadequate. fisheries. Relevant costs typically would together with any voluntary operational include the capital cost of constructing (4) Questions for Comment on Using measures or restoration measures that a technology, operation and Previous Demonstration Studies would be implemented at the facility. maintenance costs (including energy (See Sample Rule §§ 125.94, 125.95 and EPA invites public comment on penalties), and adverse environmental 125.97.) whether a final rule should permit the effects such as evaporative loss, salt use of a previous section 316(b) Examples of appropriate technologies drift, visible plumes, noise, or land use. demonstration for determining whether a facility could propose in the Design For those facilities for which the there is adverse environmental impact and Construction Technology Plan technologies will lower the generating and the best technology available for include wedgewire screens, fine mesh output of the facility, the cost of minimizing adverse environmental screens, fish handling and return replacement power and the impact. If such a provision is included systems, barrier nets, aquatic filter environmental effects of increased air in the final rule, what criteria or barrier systems, an increase in the pollution and waste generation from opening of the cooling water intake conditions should be included to ensure generating the replacement power also structure to reduce velocity and, if that the previously conducted would be considered. warranted by site specific conditions, demonstration is an adequate basis for Facilities then would calculate the net cooling tower technology. Under the section 316(b) decisions? benefits for each technology and rank Sample Rule, in-place technologies them by cost-effectiveness. Those with c. Process for Determining the Best implemented previously to comply with marginal costs greater than marginal Technology Available for Minimizing section 316(b), and information benefits would be rejected. The Adverse Environmental Impact and the regarding their effectiveness, may be technology with the greatest net benefit Role of Costs and Benefits included in the Design and Construction would be the ‘‘best’’ technology for the Technology Plan. Operational measures site. UWAG believes use of existing EPA Once it is determined that there is that may be proposed include seasonal cost-benefit calculation methodologies, adverse environmental impact shutdowns or reductions in flow and such as those used for natural resource attributable to a cooling water intake continuous operation of screens. damage valuation under CERCLA and structure, the facility and permitting The Sample Rule also would provide under NEPA would be sufficient. agency must decide on a site-specific that the Director could exclude any basis what changes to the location, design or construction technology if the (B) PSEG Recommendation for a Process design, construction, or capacity of the costs of such technology would be PSEG suggests two options for intake or what alternative voluntary significantly greater than the estimated determining best technology available measures, must be installed and benefits of the technology where prior section 316(b) implemented to minimize the impact. (§ 125.94(f)(2)). determinations were not based upon VerDate 11 data and analyses sufficient to allow a path represents the most resource- all permit the owner or operator of an permittee to seek renewal. intensive and scientifically rigorous existing facility to voluntarily undertake Under the first option, the permittee approach to implementing section restoration (or enhancement) measures would provide the permit writer with an 316(b). Under this option, the permittee in combination with, or in lieu of, assessment that would address: (1) The would provide the permit writer with a technologies to minimize adverse alternative technologies or other detailed assessment that evaluates the environmental impact. measures that are available for effects of the existing cooling water Section 125.95 of the Sample Rule addressing the cooling water intake intake structure’s operation, and provides that an owner or operator of an structure’s effects, and (2) the demonstrates the extent to which the existing facility may undertake incremental costs and benefits of operation may be jeopardizing the restoration measures, and the Director alternative technologies or other sustainability of the populations of the would be required to take into account measures relative to the existing cooling species of concern, or assesses other the expected benefits of those measures water intake structure’s operation. The appropriate factors for determining to fish and shellfish in determining application would include: an adverse environmental impact. If the whether the facility has minimized engineering report identifying the suite permitting agency concurs in an adverse environmental impact. The of technologies potentially applicable to assessment that no adverse permittee would include in its section the facility; an analysis describing the environmental impact is being caused 316(b) plan a list of the measures it bases for the selection of technologies by the existing operation, then the proposed to implement and the methods applicable to the facility; an assessment existing cooling water intake structure for evaluating the effectiveness of the of the issues associated with retrofitting would be deemed to be best technology restoration measures. the facility to include each of the available. If the assessment UWAG gives the following as applicable technologies and their costs; demonstrates that the cooling water examples of potential enhancements: (1) and an assessment of the reasonably intake structure is causing adverse Stocking fish to replace impaired RIS; likely reductions in entrainment and environmental impact or the permitting (2) creating or restoring spawning or impingement losses that would be authority rejects the applicant’s nursery habitat for RIS; (3) raising the achieved if the facility were to be determination, then the permit dissolved oxygen in anoxic areas to retrofitted to operate with the applicant would proceed to evaluate expand the carrying capacity of the RIS technology. The application also would alternative technologies or other in a water body; and (4) removing include a cost-benefit analysis that measures. obstructions to migratory species. would address and assess: the effects of UWAG would require the objectives of the reductions in entrainment and (4) Questions for Comment on a Process particular enhancements to be impingement losses on life stages of the for Determining the Best Technology established in advance, and appropriate species for which an economic value Available for Minimizing Adverse can be determined utilizing readily Environmental Impact and the Role of monitoring and/or reporting obligations available information, such as market Costs and Benefits would be included in the facility’s values of commercial species, and EPA invites public comment on the permit to confirm that enhancement recreational costs based on methods standard that would be included in any objectives have been achieved. UWAG determined to be appropriate by the site-specific final rule for determining argues that using enhancements might Director and the appropriate fisheries best technology available for lower compliance costs, might possibly management agencies. The Director minimizing adverse environmental be of more benefit to RIS than would then select the best alternative impact, including the appropriate role technologies, and might provide a technology or other measures, the costs for a consideration of costs and benefits. longer-term benefit to RIS. of which are not wholly EPA invites comment on whether the EPA invites public comment on disproportionate to the benefits, unless long-standing ‘‘wholly whether a final site-specific rule should the proposed technology or other disproportionate’’ cost-to-benefit test is permit voluntary restoration or measures clearly would not result in an appropriate measure of costs and enhancement measures to be taken into any substantial improvement to the benefits in determining best technology account in determining compliance species of concern. available for minimizing adverse with section 316(b) and, if so, what In evaluating the benefits of environmental impact. EPA also invites criteria should be included for alternative technologies, and in comment on the use of the evaluating the effectiveness of such determining whether there is likely to ‘‘significantly-greater’’ cost to benefit measures. be a substantial improvement to the test in today’s sample site-specific rule. e. Consultation With Fish and Wildlife species of concern, permittees and EPA also invites comment on whether a Management Agencies permitting authorities would undertake test based on the concept that benefits the level of biological analysis that was should justify costs would be more Because the central focus of any site- appropriate to the situation, supported appropriate, as is used in various other specific approach is the effect of the by the applicable data, and legal and regulatory contexts (see, e.g., cooling water intake structure on the commensurate with the resources Safe Drinking Water Act Section aquatic populations or ecosystems, it is available for developing and reviewing 1412(b)(6)(A) and Executive Order important that fish and wildlife the necessary studies. 12866, Section 1(b)(6)). EPA also invites management agencies with jurisdiction PSEG’s second option would be public comment on whether variances over the affected water body have an appropriate where the permittee elects are appropriate and, if so, what test or opportunity to provide information and to undertake an in-depth analysis of the tests should be used for granting a views to the Director before section potential adverse environmental impact variance. 316(b) determinations are made. The attributable to its cooling water intake Sample Rule would provide for this in structure, followed by a site-specific d. Use of Voluntary Restoration § 125.100(b)(2). The UWAG determination of the appropriate best Measures or Enhancements recommendations also recognize the technology available to minimize that The Sample Site-Specific Rule and important role of stakeholders, adverse environmental impact. This the UWAG and PSEG approaches would including fish and wildlife management VerDate 11 agencies, in a structured site-specific has invested about one full-time weakness. 66 The evidence does not, alternative (UWAG, pp. 8–9). employee per year over four years to however, establish that section 316(b) EPA invites public comment on the determine the nature and degree of determinations are a factor in the appropriate role of fish and wildlife adverse environmental impacts and the backlog in issuance of National management agencies if the final rule appropriate permit conditions the Pollutant Discharge Elimination System implements a site-specific approach. permit renewal. The State of New York permits. Department of Environmental 6. Implementation Burden Under Any EPA is also aware that resources Conservation’s Division of Fish, available to State permitting agencies Site-Specific Approach Wildlife and Marine Resources spent are limited. In a recent survey Although well-implemented, site- $169,587 in 1997 and $167,564 in 1998 conducted by ECOS (Environmental specific approaches for determining best to review cooling systems at steam- Council of States) 67 on States technology available to minimize motivated electricity generating environmental agency budget adverse environmental impact can facilities. The Division estimated a total reductions during the current fiscal year ensure that technologies are carefully effort expenditure of approximately 2.2 and for the upcoming fiscal year, 42 tailored to site-specific environmental full-time employees in 1997 and 1998 States reported that their agency was needs, EPA also recognizes that site- and 4.3 full-time employees for 2001. asked to cut or reduce their budgets for specific regulatory approaches can lead These figures do not include the level of the current fiscal year. 68 For the to difficult implementation challenges effort associated with review time spent for State and Federal permitting by the Division of Environmental following fiscal year, 23 of the agencies. EPA invites comment on the Permits, the Division of Water, or the responding States expected additional following discussion of the burdens Division of Legal Affairs. (See Docket budget cuts. EPA is aware that at least associated with implementing section W–00–03.) Because of workload one State, the State of Maryland, has 316(b) on a site-specific basis, the concerns, some States have requested used State law to impose a small competing demands on permitting that EPA adopt regulations that set clear surcharge on electric bills in the State to agencies, and resources available to requirements specifying standards of support a State research program, and permitting agencies. EPA invites performance, monitoring and that funds from that program are used comment on ways to employ a site- compliance. 63 for section 316(b) studies. specific approach while minimizing These levels of burden are of EPA seeks additional information and implementation burdens on permitting particular concern to the Agency and to data on the resources necessary and agencies. some State permitting agencies given available for the review of section 316(b) The site-specific decision-making the heavy permit workloads, pressure determinations in existing facilities’ process requires each regulated facility on resources available to permitting permit renewals. to develop, submit, and refine studies agencies, and the complexity of EPA invites comment on whether the that characterize or estimate potential finalizing permits required to address resource requirements of the site- adverse environmental impact. 316(b) requirements. Recent data specific approach also have served as a Although some approaches allow indicate that most States are struggling disincentive to a comprehensive facilities to use existing studies in to meet their major permits issuance revisiting of section 316(b) permit renewal applications, States must still targets set for decreasing the permit conditions during each renewal conduct evaluations to ascertain the backlog. For example, these data (typically every 5 years), despite continued validity of these studies and indicate that for major facilities engaged advances in technologies for reducing assess existing conditions in the water in the generation, transmission and/or impingement mortality and body. Such studies can be resource distribution of electric energy for sale entrainment. intensive and require the support of a (SIC 4911), the permit backlog is 30.3 multidisciplinary team. A Director’s percent 64, that is, higher than other EPA seeks comment on the above determinations as to whether the categories of major permits (data discussion of the resource implications appropriate studies have been indicate a backlog of 23.1 percent for of implementing the requirements of performed and whether a given facility major permits in general), 65 In 1998, the section 316(b) on a case-by-case basis. has minimized adverse environmental EPA Office of Inspector General EPA invites comment on how the impact have often been subject to identified the backlog in issuance of workload of a site-specific approach challenges that can take significant National Pollutant Discharge could be streamlined so as to provide periods of time to resolve and can Elimination System permits as a for the benefits of a site-specific impose significant resource demands on material weakness pursuant to the approach (e.g., application of permitting agencies, the public, and the Federal Managers’ Financial Integrity technologies specifically tailored to site- permit applicant. Act (FMFIA). As part of its Fiscal Year specific conditions) while recognizing Some examples of the workload that 2001 FMFIA Report, EPA recommended the resource constraints faced by so can be required for permitting agencies that the permit backlog be identified as many permitting agencies. to implement a site-specific approach a continuing material weaknesses in its follow. Since, 1999, EPA New England programs. EPA’s Office of Water is 66Decision Memorandum from the Deputy Chief Financial Officer of EPA to the Administrator, has devoted 0.6 full-time employees a examining strategies to correct this December 18, 2001. year, including a permit writer, a 67 The Environmental Council Of States is a biologist and attorney, to reissuance of 63 See communications from Mr. William national non-profit association of state and a permit for the Pilgrim Nuclear Power McCracken, Chief of the Permits Section, Surface territorial environmental commissioners. See 62 Water Quality Division, Michigan Department of website: www.sso.org/ecos/. When the Axe Falls: Station (PNPS), At the Seabrook Environmental Quality, January 24, 2002. How State Environmental Agencies Deal with Nuclear Power Station, EPA Region I 64 Backlog counts for these facilities are based on Budget Cuts by R. Steven Brown, Deputy Executive permits expired as of November 21, 2001 or if the Director and Chief Operating Officer of ECOS. (See 62 Information provided by EPA Region I. Region permit expired field in the database is blank. Docket for today’s proposed rule.) I serves as permitting authority for the non- 65 NPDES Permit Backlog Trend Report: October 68 This state budget outlook is supported by a delegated states of Massachusetts and New 31, 2001, issued on November 30, 2001 by EPA’s report published on October 31, 2001, by the Hampshire. Water Permits Division, US EPA, Washington, DC. National Conference of State Legislatures (NCSL). VerDate 11 D. Why EPA Is Not Considering Dry facilities. This relates primarily to the that dry cooling is an acceptable Cooling Anywhere? elevated capital and operating costs technology in some cases. A State may EPA conducted a full analysis for the associated with dry cooling. Adoption choose to use its own authorities to new facility rule (Phase I) and rejected of requirements based on dry cooling for require dry cooling in areas where the dry cooling as an economically a subcategory of facilities under a State finds its fishery resources need practicable option on a national basis. particular capacity would pose similar additional protection above the levels Dry cooling systems use either a natural competitive disadvantages for those provided by these technology-based or a mechanical air draft to transfer heat facilities. minimum standards. EPA does not consider dry cooling a from condenser tubes to air. In reasonable option for a national E. What Is the Role of Restoration and conventional closed-cycle recirculating requirement, nor for subcategorization Trading? wet cooling towers, cooling water that under this proposal, because the has been used to cool the condensers is 1. Restoration Measures technology of dry cooling carries costs pumped to the top of a recirculating Restoration measures, as used in the that are sufficient to cause significant cooling tower; as the heated water falls, closures for Phase II existing facilities. context of section 316(b) it cools through an evaporative process Dry cooling technology would also have determinations, include practices that and warm, moist air rises out of the a significant detrimental effect on seek to conserve fish or aquatic tower, often creating a vapor plume. electricity production by reducing organisms, compensate for lost fish or Hybrid wet-dry cooling towers employ energy efficiency of steam turbines. aquatic organisms, or increase or both a wet section and dry section and Unlike a new facility that can use direct enhance available aquatic habitat used reduce or eliminate the visible plumes dry cooling, an existing facility that by any life stages of entrained or associated with wet cooling towers. retrofits for dry cooling would most impinged species. Such measures have For the new facility rule, EPA likely use indirect dry cooling which is been employed in some cases in the past evaluated zero or nearly zero intake much less efficient than direct dry as one of several means of fulfilling the flow regulatory alternatives, based on cooling. In contrast to direct dry requirements imposed by section 316(b). the use of dry cooling systems. EPA cooling, indirect dry cooling does not Examples of restoration measures that determined that the annual compliance operate as an air-cooled condenser. In have been included as conditions of cost to industry for this option would be other words, the steam is not condensed permits include creating, enhancing, or at least $490 million. EPA based the within the structure of the dry cooling restoring wetlands; developing or costs on 121 facilities having to install tower, but instead indirectly through an operating fish hatcheries or fish stocking dry cooling. The cost for Phase II indirect heat exchanger. Therefore, the programs; removing impediments to fish existing facilities would be significantly indirect dry cooling system would need migration; and other projects designed higher. EPA estimates that 539 Phase II to overcome additional heat resistance to replace fish or restore habitat existing facilities would be subject to in the shell of the condenser compared valuable to aquatic organisms. this proposal. The cost would be to the direct dry cooling system. Restoration measures have been used, significantly higher because existing Ultimately, the inefficiency penalties of however, on an inconsistent and facilities have less flexibility, thus indirect dry cooling systems will exceed somewhat limited basis in the context of incurring higher compliance costs those of direct dry cooling systems in all the 316(b) program. Their role under (capital and operating) than new cases. section 316(b) has never been explicitly facilities. For example, existing facilities Although the dry cooling option is addressed in EPA regulations or might need to upgrade or modify extremely effective at reducing guidance until EPA promulgated the existing turbines, condensers, and/or impingement and entrainment and final section 316(b) regulations for new cooling water conduit systems, which would yield annual benefits of $138.2 facilities, which is discussed below in typically imposes greater costs than use million for impingement reductions and more detail. Prior to the section 316(b) of the same technology at a new facility. $1.33 billion for entrainment new facility regulations, restoration In addition, retrofitting a dry cooling reductions, it does so at a cost that projects were undertaken as part of tower at an existing facility would would be unacceptable. EPA recognizes section 316(b) determinations at Phase II require shutdown periods during which that dry cooling technology uses existing facilities and in permitting the facility would lose both production extremely low-level or no cooling water actions where the cost of the proposed and revenues, and decrease the thermal intake, thereby reducing impingement technology was considered to be wholly efficiency of an electric generating and entrainment of organisms to disproportionate to the demonstrated facility. dramatically low levels. However, EPA environmental benefits that could be The disparity in costs and operating interprets the use of the word achieved. Often such cases involved efficiency of dry cooling systems ‘‘minimize’’ in section 316(b) in a situations where retrofitting with a compared with wet cooling systems is manner that allows EPA the discretion technology such as cooling towers was considerable when viewed on a to consider technologies that very under consideration. In addition to the nationwide or regional basis. For effectively reduce, but do not role for restoration outlined as part of example, under a uniform national completely eliminate, impingement and the today’s proposed rule (see Section requirement based on dry cooling, entrainment and therefore meet the VI.A. above), EPA invites comment on facilities in the southern regions of the requirements of section 316(b). the following alternatives for restoration U.S. would be at an unfair competitive Although EPA has rejected dry cooling as part of regulations for Phase II disadvantage compared to those in technology as a national minimum existing facilities. cooler northern climates. Even under a requirement, EPA does not intend to regional subcategorization strategy for restrict the use of dry cooling or to a. The Role of Restoration in the Section facilities in cool climatic regions of the dispute that dry cooling may be the 316(b) New Facility Regulations U.S., adoption of a minimum appropriate cooling technology for some The final rule for new facilities requirement based on dry cooling could facilities. For example, facilities that are includes restoration measures as part of impose unfair competitive restrictions repowering and replacing the entire Track II. EPA did not include for steam electric power generating infrastructure of the facility may find restoration in Track I because it was VerDate 11 intended to be expeditious and provide placement and purpose in the statutory impacts other than impingement certainty for the regulated community scheme.) mortality and entrainment is included, and a streamlined review process for the In the new facility rule EPA the Track II technologies would permitting authority. To do this for new recognized that restoration measures maintain fish and shellfish in the facilities, EPA defined the best have been used at existing facilities waterbody at a substantially similar technology available for minimizing implementing section 316(b) on a case- level to that which would be achieved adverse environmental impact in terms by-case, best professional judgment under Track I (quantitative or of reduction of impingement and basis as an innovative tool or as a tool qualitative demonstration). to conserve fish or aquatic organisms, entrainment, a relatively straightforward b. Restoration Approaches Being metric for environmental performance compensate for the fish or aquatic organisms killed, or enhance the aquatic Considered for the Existing Facilities of cooling water intake structures. In Rule contrast, restoration measures in general habitat harmed or destroyed by the require complex and lengthy planning, operation of cooling water intake In the existing facilities rule, EPA is implementation, and evaluation of the structures. Under Track II, that proposing to allow restoration as one effects of the measures on the flexibility will continue to be available means of satisfying the compliance populations of aquatic organisms or the to new facilities to the extent that they requirements for any one of the three ecosystem as a whole. can demonstrate performance alternatives in § 125.94(a). The demonstration a facility would make to EPA included restoration measures in comparable to that achieved in Track I. For example, if a new facility that show that the restoration measures Track II to the extent that the Director chooses Track II is on an impaired provide comparable performance to determines that the measures taken will waterbody, that facility may choose to design and construction technologies maintain the fish and shellfish in the demonstrate that velocity controls in and/or operational measures would be waterbody in a manner that represents concert with measures to improve the similar to the demonstration that a performance comparable to that productivity of the waterbody will facility would make under Track II in achieved in Track I. Applicants in Track result in performance comparable to the new facility rule. EPA is also II need not undertake restoration that achieved in Track I. The additional inviting comment on other restoration measures, but they may choose to measures may include such things as approaches it is considering. These undertake such measures. Thus, to the reclamation of abandoned mine lands to include discretionary and mandatory extent that such measures achieve eliminate or reduce acid mine drainage regulatory approaches involving performance comparable to that along a stretch of the waterbody, restoration measures as well as achieved in Track I, it is within EPA’s establishment of riparian buffers or restoration banking, which are authority to authorize the use of such other barriers to reduce runoff of solids discussed below. measures in the place of Track I and nutrients from agricultural or (1) Discretionary Restoration requirements. This is similar to the silvicultural lands, removal of barriers Approaches compliance alternative approach EPA to fish migration, or creation of new took in the effluent guidelines program habitats to serve as spawning or nursery An approach being considered by for Pesticide Chemicals: Formulating, areas. Another example might be a EPA would provide the Director with Packaging and Repackaging. There EPA facility that chooses to demonstrate that the discretion to specify appropriate established a numeric limitation but flow reductions and less protective restoration measures under section also a set of best management practices velocity controls, in concert with a fish 316(b), but would not require that he or that would accomplish the same hatchery to restock fish being impinged she do so. This approach is consistent numeric limitations. See 61 FR 57518, and entrained with fish that perform a with several precedents in which the 57521 (Nov. 6, 1997). EPA believed that similar function in the community permitting authority allowed the use of section 316(b) of the Clean Water Act structure, will result in performance restoration measures when the cost to provided EPA with sufficient authority comparable to that achieved in Track I. retrofit an existing facility’s cooling to allow the use of voluntary restoration Finally, in the new facility rule, EPA water intake structures with control measures in lieu of the specific recognized that it may not always be technologies was determined to be requirements of Track I where the possible to establish quantitatively that wholly disproportionate to the benefits performance is substantially similar the reduction in impact on fish and the control technology would provide under the principles of Chevron USA v. shellfish is comparable using the types (e.g., John Sevier, Crystal River, Chalk NRDC, 467 U.S. 837, 844–45 (1984). In of measures discussed above as would Point, Salem). 69 section 316(b) of the Clean Water Act, be achieved in Track I, due to data and Congress is silent concerning the role of modeling limitations. Despite such (2) Mandatory Restoration Approach restoration technologies both in the limitations, EPA stated that there may Under this approach, the use of statute and in the legislative history, be situations where a qualitative restoration measures would be required either by explicitly authorizing or demonstration of comparable as an element of a section 316(b) explicitly precluding their use. In the performance could reasonably assure determination in all cases or in some context of the new facility rule EPA also substantially similar performance. For defined set of cases (e.g., for intake believes that appropriate restoration that reason, EPA provided, in § 125.86 structures located on oceans, estuaries, measures or conservation measures that of the new facility rule, that the Track are undertaken on a voluntary basis by II Comprehensive Demonstration Study 69 In re Tennessee Valley Authority John Sevier a new facility to meet the requirements should show that either: (1) The Track Steam Plant, NPDES Permit No. TN0005436 (1986); In re Florida Power Corp. Crystal River Power Plant of that rule fall within EPA’s authority II technologies would result in Units 1, 2, & 3, NPDES Permit FL0000159 (1988); to regulate the ‘‘design’’ of cooling water reduction in both impingement Chalk Point, MDE, State of Maryland, Discharge intake structures. Bailey v. U.S., 516 mortality and entrainment of all life Permit, Potomac Electric Power Co., State Discharge U.S. 137 (1995) (In determining the stages of fish and shellfish of 90 percent Permit No. 81–DP–0627B, NPDES Permit No. MD0002658B (1987, modified 1991); Draft NJDEP meaning of words used in a statute, the or greater of the reduction that would be Permit Renewal Including Section 316(a) Variance court considers not only the bare achieved through Track I (quantitative Determination and Section 316(b) BTA Decision: meaning of the word, but also its demonstration) or, (2) if consideration of NJDEP Permit No. NJ0005622 (1993). VerDate 11 or tidal rivers). Restoration would be in environmental performance within a monitoring susceptible species and required to compensate for organisms watershed that is comparable to the administrating the program. EPA that were not protected following reductions of impingement mortality believes that a trading program that facility installation of control and entrainment specified in the focuses on entrainment is more viable. technologies. Phase II existing facilities proposed § 125.94. EPA is considering However, EPA requests comment on with cooling water intake structures an approach for implementing section whether to extend trading to include would be required to implement some 316(b) that would allow specific Phase impingement of aquatic organisms. form of restoration measures in addition II existing facilities to trade entrainment to implementing direct control reductions to achieve an overall In contrast to impingement controls, technologies to minimize adverse standard of performance for entrainment entrainment reduction technologies can environmental impact. Under this reduction in a watershed at a lower cost be relatively expensive. Section 316(b) approach, an existing facility would through a voluntary State or authorized trading would enable smaller facilities submit a plan to restore fish and Tribal section 316(b) trading program. that cannot afford to install more costly shellfish to the extent necessary for EPA believes such an approach might be technologies to reduce their costs by offsetting fish and shellfish entrainment appropriate in light of section 316(b)’s trading with other Phase II existing and impingement losses estimated to objective of minimizing adverse facilities that face relatively lower costs continue to occur after any required environmental impact. The goal of the of entrainment reduction. For the control technology is installed. This trading approach is to provide an purpose of a section 316(b) trading restoration plan would be reviewed and incentive for some Phase II existing program, an entrainment reduction approved by the Director and facilities to implement more protective performance standard for a watershed incorporated in the permit. This is technologies than required by today’s would be set by the authorized State or similar to the mitigation sequence used proposed rule, resulting in credits that Tribe within the range of 60 to 90 under CWA section 404, wherein can be traded with other facilities that percent for all life stages of entrained environmental impacts are avoided and may not find the most protective fish and shellfish. The performance minimized prior to consideration of technologies economically practicable. standard would be set to reflect site- compensatory mitigation measures EPA acknowledges that the trading specific facility and ecological although in section 404, not all projects framework that EPA is contemplating characteristics. All facilities located in require mitigation. The development of under section 316(b) differs from the watershed would need to reach the restoration measures applicable to a previous trading strategies implemented performance standard through the by EPA because it involves trading cooling water intake structure would installation of technologies to reduce focus on the unique situation faced by living resources rather than pollutant entrainment (or, potentially, restoration each facility and would allow for review loads. Because this is a novel approach measures to compensate for entrainment and comment by the permitting agency to trading, it raises many questions. For losses at the facility). A facility that can and the public. example, how would the program address concerns that some species have afford to implement technologies to (3) Restoration Banking greater economic value than others, or reduce entrainment above the Restoration plans could potentially the counter-argument that some species performance standard would have use a banking mechanism similar to may not be economically valuable but entrainment reduction credits to sell to those used in the CWA section 404 nonetheless have high ecological value? other facilities that cannot afford or program, that would allow the permittee What is an appropriate spatial scale choose not to meet the performance to meet requirements by purchasing under which trading can occur to ensure standard by technology alone. EPA restoration credits from an approved protection of water quality and aquatic notes that in § 125.94(c) of today’s bank. For example, should wetlands organisms? The following section proposed rule, Phase II existing facilities restoration be an appropriate addresses these questions and others may request a site-specific mechanism for offsetting the adverse and seeks comment on the appropriate determination of best technology impact caused by a cooling water intake elements of a trading approach under available if the costs of compliance with structure, the permittee could purchase section 316(b) that would conserve and the applicable performance standards credits from an existing wetlands protect water quality and aquatic are significantly greater than the costs mitigation bank established in resources. EPA considered when establishing the accordance with the Federal Guidance a. Entrainment Reduction vs. performance standards or significantly for the Establishment, Use and Impingement Reduction as a Basis for greater than site-specific benefits. If a Operation of Mitigation Banks (50 FR Trading section 316(b) trading program was 58605; November 28, 1995). As in the available, these facilities could CWA section 404 program, public or Entrainment and impingement are the main causes of adverse environmental potentially have a lower cost option for private entities could establish and meeting the applicable performance operate the banks providing mitigation impact from cooling water intake standard for their respective for impacts under 316(b). EPA views the withdrawals. However, impingement waterbodies by purchasing credits from use of restoration banking for the reduction technologies are relatively another facility that implements more purposes of this proposed rule as one inexpensive compared to entrainment way to facilitate compliance and reduce reduction (see Chapter 2 of the protective technologies. EPA seeks the burden on the permit applicant, Technical Development Document for comment on whether a section 316(b) while at the same time potentially the New Facility Rule, EPA–821–R–01– trading program would generally afford enhancing the ecological effectiveness 036, November 2001). Impingement greater watershed protection by of the required restoration activities. reduction measures include decreasing increasing the number of facilities intake velocities and installation of meeting the performance standard and 2. Entrainment Trading traveling screens with fish baskets and whether consideration of credit Under § 125.90(d) of today’s proposed fish return systems. The implementation purchases should be mandatory prior to rule, States may adopt alternative of a section 316(b) trading program for the Director setting alternative regulatory requirements that will result impingement may not justify the cost of requirements. VerDate 11 b. What Should Be the Spatial Scale for to divide the conterminous United section VI.E.1 of the preamble to today’s Trading? States by drainage basins. As the proposed rule for additional information EPA is considering limiting the zone number of digits in the code increases, and discussion on restoration. the drainage basin delineation becomes within which trading may occur among (1) Species Density Phase II existing facilities subject to more refined. Eight-digit codes represent the fourth level of Trading based on the density of section 316(b). Due to site-specific classification in the hierarchy of entrained species life stages (the number differences in species and life stages of hydrologic units, where each code of eggs, larvae, juvenile and small fish entrained organisms, the scale of the represents all or part of a surface for all fish and shellfish species trading zone would be set to minimize drainage basin. There are 2,150 eight- entrained per unit of flow through a these differences as much as possible. digit HUCs in the conterminous United facility) is EPA’s preferred approach Trading would be most protective if it States. In order to be eligible to trade because it would account for differences occurred among Phase II existing under this approach, all facilities among facilities in the number of facilities that generally entrain the same involved in the trade would be located organisms entrained per unit flow and species and life stages at relatively in the same eight-digit HUC. EPA would, in a sense, standardize similar densities per unit flow through invites comment on these and other entrainment losses with intake flow the facility. Thus, EPA would prefer that potential trading zones for section withdrawals. Under this approach, trades be conducted by Phase II existing 316(b) trading for Phase II existing trading would be restricted to those facilities sited in waterbodies that share facilities. Phase II existing facilities sited at similar ecological characteristics, waterbodies with similar ecological regardless of the relative geographic (3) General Waterbody Type zones, such as the transitional zone proximity of the facilities to each other. EPA is also considering a site-specific between saline and freshwater portions EPA is also considering limiting trades approach that would require facilities to of an estuary. Because many aquatic to specific waterbodies, specific study and provide data on the numbers, species tend to inhabit specific zones watersheds, or general waterbody types life stages, and species of organisms within a waterbody during their life (tidal rivers, estuaries, oceans). entrained in order to be properly histories, restricting trade to individual Preliminary EPA analyses indicate that matched for trading with another Phase zones would ensure that similar species some of these options may increase the II existing facility on the same at similar densities are traded. In order number of Phase II existing facilities waterbody type (e.g., tidal river, estuary, for a trade to occur, the facilities eligible to trade and thus may produce ocean, Great Lake) which entrains the involved must historically entrain sufficient opportunities to reduce the similar numbers, life stages, and species similar species. Under this approach the cost of meeting the performance of organisms. EPA seeks comment on comparable worth of the unit of flow standard, allowing for a broader range of this approach which allows trades to would be dependent upon the density of trades. occur among facilities on the same the species entrained (see example (1) Specific Waterbody general waterbody type, but not below). Thus, if a facility entrains twice necessarily the same waterbody. as many organisms as another facility, If section 316(b) trades for Phase II its flow would be worth comparably c. What Should Be the Unit (Credit) for existing facilities were limited on an twice as much. This approach would Trading? individual waterbody basis, EPA ensure that all species entrained are estimates that there would be a total of A trading option requires a definition protected, but may limit the number of 132 Phase II existing facilities in 40 of the trading commodity and the unit, trades possible. It is possible that use of specific waterbodies eligible to trade. In or credit, that would be traded. In this approach may lead to over- order to be eligible to trade, each facility contrast to pollutant-specific trading, protection or under-protection of some involved in the trade would need to be which is normally based on the pounds species since the average density of all located on the same waterbody and of a single pollutant released into the fish and shellfish would be used rather required to meet the performance environment or reduced from a source, than the density for individual species. standard of the waterbody. Further trading of entrained species can involve limits would have to be placed on a variety of fish and shellfish species (2) Species Counts trading in very large waterbodies (e.g., and their life stages, and may be highly Another option for a trading unit is Mississippi River, Pacific Ocean, variable among facilities. Therefore, it entrained organism counts by species, Atlantic Ocean) to ensure that the could be difficult to define a trading life stage, and size. These types of facilities are within similar climatic unit and substantial oversight would be measurements are routinely collected as zones, and thus entrain similar species. needed under any of these trading units part of historical facility demonstration Allowing trading among Phase II to determine if the trade complied with studies. This option would be protective existing facilities and those that may be the underlying performance standards of all life stages independently, but subject to Phase III regulations for from year to year, or another appropriate would require significant expenditures cooling water intake structures could period. In developing this proposal, of time and resources. Entrained increase opportunities for facilities to EPA considered a variety of potential organisms would need to be identified trade intake control requirements. trading credits and invites comment on to fairly precise taxonomic levels and these and other potential trading units. organized by life stage and size classes. (2) Specific Watershed EPA is specifically interested in This option would best address the By limiting trading on a watershed comments on whether entrainment question of different economic values basis, the problems posed by very large trading should be species-specific, have versus ecological values of species since waterbodies are eliminated; however, weighted values for different species, or it would allow different monetary the zone may include different types of simply be net biomass entrainment values to be set for each species. waterbodies that may harbor different expressed in mass. EPA is also Although this option would allow for species of organisms. Hydrologic Unit considering use of restoration measures comparable species-by-species trading Codes (HUC) were developed by the in conjunction with any of the trading among Phase II existing facilities, EPA United States Geological Survey (USGS) units discussed below. Please see is concerned that it may also result in VerDate 11 complex trading transactions. Also, the In effect, Facility A has reduced its multiplied by the gallons of resource number of each species entrained by a entrainment by 20 percent more than it use needed by Facility B would equal facility can vary substantially each year needs to in order to provide its share the gallons of resource use that Facility for many reasons, including facility toward meeting the performance B would need to buy from Facility A in outages and extreme weather events. standard of 75 percent for the estuary. order to make up for the difference in Substantial oversight might be needed Because of its small size, Facility B the density of the species the two to determine if the trade achieved the determines that it is not cost effective to facilities entrain. Based on the underlying technology-based reduce entrainment by 75 percent. discrepancy in the average density of performance standard from year to year, Instead, Facility B chooses to install fine organisms entrained as calculated or other appropriate period, for mesh wedgewire screens, which reduce above, in order to trade with Facility A, compliance. its entrainment by 60 percent. Facility B Facility B must purchase entrainment could possibly make up for the credits for 1.658 times as many gallons (3) Biomass remaining 15 percent of its share to as it needs. Thus, Facility B needs to Another potential measure that can be meet the estuary’s performance standard purchase 87,045,000 gallons of resource used for trading is the biomass of by trading. use from Facility A (1.658 * 52,500,000). entrained organisms. Biomass is defined Based on historical monitoring data, as the weight of living material (plant Facility A entrains alewife, Atlantic e. Trading Option for New Facilities and animal) and can be measured in croaker, Atlantic menhaden, bay EPA is considering extending a pounds or kilograms. Measuring the anchovy, blueback herring, silversides, section 316(b) trading program beyond biomass of organisms entrained by spot, striped bass, weakfish and white the Phase II rule for existing electric facility intakes would be relatively fast perch. The average number, across generation facilities. Those facilities that and easy to quantify. However, the many years of data, of all life stages of are covered by the Phase I rule (new pound/kilogram as a unit of all species entrained is 417,210 fish per facilities) might be allowed to measurement does not take into account day. Per gallon of water used, it entrains participate in a section 316(b) trading species variations found at different 0.000556 fish (417,210/750,000,000). program. New facilities could facility locations and within multiple Facility B also entrains alewife, implement technological controls waterbody types. Thus, as a result of Atlantic croaker, Atlantic menhaden, beyond what is required under the adopting this unit of measurement, it bay anchovy, blueback herring, Phase I rule. In general, if more facilities would be impossible to distinguish silversides, spot, striped bass, weakfish, were allowed to trade, there would be between different species, or even and white perch as determined by an increased degree of competitiveness different kingdoms. Because the weights historical monitoring data. Facility B in trading and it would become easier of all entrained organisms are combined historically entrains the same species of to meet the performance standard into a total mass, biomass measurement fish as Facility A as they withdraw because entrainment reductions would may not be equally protective of all water from the same waterbody. The be shared by multiple facilities. EPA species and life stages, and larger, average number, across many years of invites comment on the option of heavier organisms may bias final results. data, of all life stages of all species extending a section 316(b) trading Over time, biomass trading may upset entrained is 322,620 fish per day. Per program to new facilities. the natural equilibrium of certain gallon of water used, it entrains f. Voluntary Adoption of Trading by species and/or impact the functionality 0.000922 fish (322,620/350,000,000). Authorized States and Tribes of the entire ecosystem should some Based on density, Facility B entrains species be entrained more frequently 1.658 times as many fish as Facility A Under EPA’s preferred alternative for than others. However, EPA invites per unit flow (0.000922/0.000556). This section 316(b) trading, authorized States comment on whether biomass trading is the average density ratio of organisms or Tribes would decide whether to might be limited to certain zones of entrained. voluntarily adopt a section 316(b) certain waterbodies or waterbody types, Facility B needs to make up for 15 trading program. EPA notes that in a manner similar to that described percent of its share toward the estuary’s authorized States and Tribes would first above for species-density trading to performance standard for entrainment need to adopt the appropriate legal address some of these concerns. reduction. Again, using the standard authority to conduct a section 316(b) assumption that entrained organisms trading program. In general, EPA d. Example of Section 316(b) Trading behave like passive water molecules, the believes that States and Tribes have a Under EPA’s Preferred Alternative simplified 1:1 relationship between flow better understanding of the dynamics, (Species Density) and entrainment from Facility A is also value, and overall quality of their local Facility A is an existing 750 MGD used for Facility B in this example. waterbodies based on assigned facility located in an estuary. Facility B Therefore, Facility B needs to designated uses, 305(b) monitoring is an existing 350 MGD facility located compensate for the environmental reports, and other relevant information at the mouth of the same estuary. The effects caused by 15 percent of its flow, and studies compiled over time. Thus, performance standard for this estuary or 52,500,000 gallons of resource use authorized States or Tribes may be in a has been set by the authorized State or (0.15 * 350,000,000). Since Facility A better position to judge whether or not Tribe at a 75 percent reduction of has reduced entrainment 20 percent to develop and implement a section entrainment for all facilities. Facility A more than required, it has 150,000,000 316(b) trading program. Although EPA determines that it can install a cooling gallons of resource use available for acknowledges that a nationally-run tower at relatively low cost. The trading (0.20 * 750,000,000). A trade section 316(b) trading program may installation of the cooling tower reduces could be made between these two enhance uniformity, EPA is concerned the facility’s flow by 95 percent. Using facilities because they are located on the that a national program may not be the standard assumption that entrained same waterbody, they both must install feasible because of differences in organisms behave like passive water entrainment controls, and the same species; habitats; waterbody molecules, this flow reduction will, on species are present in their respective characteristics; and the variety, nature, a long-term average basis, reduce entrainment numbers. The average and magnitude of environmental entrainment by 95 percent at Facility A. density ratio of organisms entrained impacts from cooling water intake VerDate 11 structures found across the United the permitting program at the Federal, B. What Information Must I Submit to States. EPA seeks comment on whether State, or authorized Tribe level. These the Director When I Apply for My a national registry of trades and challenges include development of Reissued NPDES Permit? associated national trading guidance implementation guidance, incorporation The NPDES regulations that establish would be appropriate. of a section 316(b) trade tracking system the application process at 40 CFR A voluntary program would be within EPA’s Permit Compliance 122.21(d)(2) generally require that administered by the authorized State or System or through some other tracking facilities currently holding a permit Tribe. Authorized States and Tribes that mechanism, self-reporting on submit information and data 180 days participate could allow trading among compliance with trade agreements prior to the end of the permit term, facilities to meet the entrainment (similar to the self-reporting conducted which is five years. If you are the owner reduction performance standard. Key through use of Discharge Monitoring or operator of a facility that is subject to environmental and natural resource Reports), determination of the this proposed rule, you would be agencies, industry and its trade required to submit the information that associations, and local environmental administrative cost and burden of such is required under 40 CFR 122.21(r)(2), groups involved in the protection of the a trading program and EPA oversight of (3), and (5) and § 125.95 of today’s watershed would participate in the whether regulatory requirements for authorized State or Tribal section 316(b) impingement and entrainment proposed rule with your application for trading program through the public reduction are met. EPA invites comment permit reissuance. This section provides comment process. The program would on these unique challenges and any a general discussion of the proposed also include consultation with from others regarding implementation, application requirements for Phase II relevant Federal, State and authorized compliance assessment, and existing facilities at the outset and then Tribal resource agencies and enforcement of a section 316(b) trading goes into more detail in subsequent neighboring authorized States and program. subsections. The Director would review Tribes where interstate waters are the information you provide in your VII. Implementation affected (similar to stakeholder application including the information submitted in compliance with 40 CFR involvement under the NPDES As in the new facility rule, section permitting program). 122.21(r) and § 125.95 and would 316(b) requirements for Phase II existing confirm whether your facility should be g. When Would the Permits Be Reissued facilities would be implemented regulated as an existing facility under to Trading Partners? through the NPDES permit program. these proposed regulations or as a new If trades under section 316(b) are done Today’s proposal would establish facility under regulations that were on a watershed basis, and permits are application requirements in § 125.95, published on December 19, 2001 (66 FR synchronized, then permits would be monitoring requirements in § 125.96, 65256) and establish the appropriate reissued to trading partners at the same and recordkeeping and reporting requirements to be applied to the time according to the permitting requirements in § 125.97 for Phase II cooling water intake structure(s). authority’s standard permit renewal existing facilities that have a design Today’s proposed rule would modify cycle (e.g., every 5 years). With intake flow of 50 MGD or more. The regulations at 40 CFR 122.21(r) to permitting authorities that have moved proposed regulations also require the require existing facilities to prepare and toward a watershed permitting strategy, Director to review application materials submit some of the same information synchronizing the permit renewal submitted by each regulated facility and required for new facilities. The process for all trading partners in a include monitoring and recordkeeping proposed application requirements geographic area reduces some requirements in the permit (§ 125.98). would require owners or operators of administrative cost and burden on the EPA will develop a model permit and Phase II existing facilities to submit two permitting authorities. permitting guidance to assist Directors general categories of information when Alternatively, a trading arrangement in implementing these requirements they apply for a reissued NPDES permit. may not be specified in the permit. after they are finalized. In addition, the The general categories of information Instead, the permit would include the Agency will develop implementation would include (1) Physical data to performance standard and a guidance for owners and operators that characterize the source waterbody in the requirement to meet that standard. will address how to comply with the vicinity where the cooling water intake Under this approach, trades could occur application requirements, the sampling structures are located (40 CFR between permitting cycles. Another and monitoring requirements, and the 122.21(r)(2)) and (2) data to characterize option would allow trading of recordkeeping and reporting the design and operation of the cooling entrainment units between Phase II requirements in these proposed water intake structures (40 CFR existing facilities within permit cycles regulations. 122.21(r)(3)). Unlike the new facilities, at the discretion of each authorized however, Phase II existing facilities State or Tribal permitting authority. A A. When Does the Proposed Rule would not be required to submit the disadvantage to this approach is the Become Effective? Source Water Baseline Biological additional administrative burden borne Characterization Data required under 40 by the permitting authorities. EPA seeks Phase II existing facilities subject to CFR 122.21(r)(4)). Today’s proposed comment on how to harmonize the today’s proposed rule would need to rule would add a new requirement at 40 reissuance of permits with trading comply with the Subpart J requirements CFR 122.21(r)(5) to require a facility to among Phase II existing facilities under when an NPDES permit containing submit information describing the section 316(b). requirements consistent with Subpart J design and operating characteristics of is issued to the facility. See proposed its cooling water systems and how they h. Implementation and Enforcement § 125.92. Under existing NPDES relate to the cooling water intake Issues for Section 316(b) Trading program regulations, this would occur structures at the facility. The concept of a section 316(b) when an existing NPDES permit is In addition, today’s proposed rule trading program for Phase II existing reissued or, when an existing permit is would require all Phase II existing facilities presents many challenges for modified or revoked and reissued. facilities to submit the information VerDate 11 required under § 125.95. In general, the allow the permit writer to evaluate impingement mortality and entrainment proposed application requirements in which species or life stages would that is attributed to the reduction in § 125.95 require all Phase II existing potentially be subject to impingement flow in complying with the performance facility applicants, except those that and entrainment. A diagram of the standards in § 125.94(b). already use a closed-cycle, recirculating facility’s water balance would be used 4. Comprehensive Demonstration Study cooling system, to submit a to identify the proportion of intake (§ 125.95(b)) Comprehensive Demonstration Study water used for cooling, make-up, and (§ 125.95(b)). This study includes a process water. The water balance Proposed application requirements at proposal for information collection; diagram also provides a picture of the § 125.95(b) would require all existing source waterbody information; a total flow in and out of the facility, facilities except those deemed to have characterization of impingement allowing the permit writer to evaluate met the performance standard in morality and entrainment; a proposal for compliance with the performance § 125.94(b)(1) (reduced intake capacity technologies, operational measures, standards. to a level commensurate with the use of restoration measures and estimated The applicant would be required to a closed-cycle, recirculating cooling efficacies; and a plan to conduct submit the following specific data: (1) A water system) to perform and submit to monitoring to demonstrate that the narrative description of the the Director the results of a proposed technologies and measures configuration of each of its cooling Comprehensive Demonstration Study, achieve the performance levels that water intake structures and where they including data and detailed analyses to were estimated. The following describes are located in the waterbody and in the demonstrate that you will meet the proposed application requirements water column; (2) latitude and longitude applicable requirements in § 125.94. in more detail. in degrees, minutes, and seconds for The proposed Comprehensive each of its cooling water intake Demonstration Study has seven 1. Source Water Physical Data (40 CFR structures; (3) a narrative description of components. 122.21(r)(1)(ii)) the operation of each of your cooling • Proposal for Information Collection; Under the proposed requirements at water intake structures, including • Source Waterbody Flow 40 CFR 122.21(r)(1)(ii), Phase II existing design intake flows, daily hours of Information; • facilities subject to this proposed rule operation, number of days of the year in Impingement Mortality and would be required to provide the source Entrainment Characterization Study; operation, and seasonal operation • water physical data specified at 40 CFR schedules, if applicable; (4) a flow Design and Construction 122.21(r)(2) in their application for a Technology Plan; distribution and water balance diagram • reissued permit. These data are needed that includes all sources of water to the Information to Support Proposed to characterize the facility and evaluate facility, recirculating flows, and Restoration Measures; • Information to Support Site-specific the type of waterbody and species discharges; and (5) engineering potentially affected by the cooling water drawings of the cooling water intake Determination of Best Technology intake structure. The Director would use structure. Available for Minimizing Adverse Environmental Impact; and this information to evaluate the • appropriateness of the design and 3. Phase II Existing Facility Cooling Verification Monitoring Plan. construction technologies proposed by Water System Description (40 CFR The information required under each of the applicant. 122.21(r)(1)(ii)) these components of the Comprehensive The applicant would be required to Under the proposed requirements at Demonstration Study may not be submit the following specific data: (1) A 40 CFR 122.22(r)(1)(ii), Phase II existing required to be submitted by all Phase II narrative description and scale drawings facilities would be required to submit existing facilities. Required submittals showing the physical configuration of the cooling water system data specified for your facility would depend on the all source waterbodies used by the at 40 CFR 122.21(r)(5) to characterize compliance option you have chosen. All facility, including areal dimensions, the operation of cooling water systems Phase II existing facilities, except those depths, salinity and temperature and their relationship to the cooling deemed to have met the performance regimes, and other documentation; (2) water intake structures at the facility. standard in § 125.94(b)(1), would be an identification and characterization of Also proposed to be required is a required to submit a Proposal for the source waterbody’s hydrological and description of the design intake flow Information Collection; a Source geomorphological features, as well as that is attributed to each system and the Waterbody Flow Information; an the methods used to conduct any number of days of the year in operation Impingement Mortality and Entrainment physical studies to determine the and any seasonal operation schedules, if Characterization Study; a Design and intake’s zone of influence and the applicable. This information would be Construction Technology Plan; and a results of such studies; and (3) used by the applicant and the Director Verification Monitoring Plan. Only locational maps. in determining the appropriate those Phase II existing facilities that standards that can be applied to the propose to use restoration measures in 2. Cooling Water Intake Structure Data Phase II facility. Facilities that have whole or in part to meet the (40 CFR 122.21(r)(1)(ii)) closed-cycle, recirculating cooling water performance standards in § 125.94 Under the proposed requirements at systems will be determined to have met would be required to submit the 40 CFR 122.21(r)(1)(ii), Phase II existing the performance standards in § 125.94 if Information to Support Proposed facilities would be required to submit all of their systems are closed-cycle, Restoration Measures. Only those the cooling water intake structure data recirculating cooling systems. These facilities who choose to demonstrate specified at 40 CFR 122.21(r)(3) to facilities are not required to submit a that a site-specific standard is characterize the cooling water intake Comprehensive Demonstration Study. appropriate for their site would be structure and evaluate the potential for Additionally, if only a portion of the required to submit Information to impingement and entrainment of total design intake flow is water Support Site-specific Determination of aquatic organisms. Information on the withdrawn for a closed-cycle, Best Technology Available for design of the intake structure and its recirculating cooling system, such Minimizing Adverse Environmental location in the water column would facilities may use the reduction in Impact. VerDate 11 a. Proposal for Information Collection change in conditions at the site since design intake flow is maintaining the Before performing the study you the last permit renewal, a long lead time thermal stratification or turnover pattern would be required to submit to the might not be necessary. This would (where present) of the source water Director for review and approval, a most likely be the case for subsequent except in cases where the disruption is proposal stating what information permit renewals following the first determined to be beneficial to the would be collected to support the study renewal after the Phase II requirements management of fisheries for fish and (see § 125.96(b)(1)). This proposal go into effect. EPA requests comment on shellfish by any fishery management would provide: (1) A description of the whether it should specify a particular agency(ies). time frame for submitting the proposed and/or implemented c. Impingement Mortality and technology(ies) and/or supplemental information collection proposal, or alternatively, whether it should remove Entrainment Characterization Study restoration measures to be evaluated; (2) (§ 125.95(b)(3)) a list and description of any historical the requirement for approval by the studies characterizing impingement and Director. The proposed regulations would entrainment and/or the physical and b. Source Waterbody Flow Information require that you submit the results of an Impingement Mortality and Entrainment biological conditions in the vicinity of Under the proposed requirements at Characterization Study in accordance the cooling water intake structures and § 125.95(b)(2)(i), Phase II existing with § 125.96(b)(3). This their relevance to this proposed study. facilities, except those deemed to meet characterization would include: (1) If you propose to use existing data, you the performance standard in must demonstrate the extent to which § 125.94(b)(1), with cooling water intake Taxonomic identifications of those the data are representative of current structures that withdraw cooling water species of fish and shellfish and their conditions and that the data were from freshwater rivers or streams would life stages that are in the vicinity of the collected using appropriate quality be required to provide the mean annual cooling water intake structure and are assurance/quality control procedures; flow of the waterbody and any most susceptible to impingement and (3) a summary of any past, ongoing, or supporting documentation and entrainment; (2) a characterization of voluntary consultations with engineering calculations that allow a these species of fish and shellfish and appropriate Federal, State, and Tribal determination of whether they are life stages, including a description of the fish and wildlife agencies that are withdrawing less than or greater than abundance and temporal/spatial relevant to this study and a copy of five (5) percent of the annual mean flow. characteristics in the vicinity of the written comments received as a result of This would provide information needed cooling water intake structure, based on such consultation; and (4) a sampling to determine which requirements the collection of a sufficient number of plan for any new field studies you (§ 125.94(b)(2) or (3)) would apply to the years of data to characterize annual, propose to conduct in order to ensure facility. The documentation might seasonal, and diel variations in that you have sufficient data to develop include either publicly available flow impingement mortality and entrainment a scientifically valid estimate of data from a nearby U.S. Geological (e.g., related to climate/weather impingement and entrainment at your Survey (USGS) gauging station or actual differences, spawning, feeding and site. The sampling plan would instream flow monitoring data collected water column migration); and (3) document all methods and quality by the facility. The waterbody flow documentation of the current assurance/quality control procedures for should be compared with the total impingement mortality and entrainment sampling and data analysis. The design flow of all cooling water intake of all life stages of fish and shellfish at sampling and data analysis methods you structures at the regulated facility. the facility and an estimate of propose must be appropriate for a Under the proposed requirements at impingement mortality and entrainment quantitative survey and must take into § 125.95(b)(2)(ii), Phase II existing under the calculation baseline. This account the methods used in other facilities subject to the proposed rule documentation may include historical studies performed in the source with cooling water intake structures that data that are representative of the waterbody. The sampling plan would withdraw cooling water from a lake or current operation of the facility and of include a description of the study area reservoir and that propose to increase biological conditions at the site. (including the area of influence of the the facility’s design intake flow would Impingement mortality and entrainment cooling water intake structure), and be required to submit a narrative samples to support the calculations provide taxonomic identifications of the description of the waterbody thermal required in § 125.95(b)(4)(iii) and sampled or evaluated biological stratification and any supporting (b)(5)(ii) must be collected during assemblages (including all life stages of documentation and engineering periods of representative operational fish and shellfish). calculations to show that the increased flows for the cooling water intake The proposed rule does not specify flow meets the requirement not to structure and the flows associated with particular timing requirements for your disrupt the natural thermal stratification the samples must be documented. In information collection proposal, but or turnover pattern (where present) of addition, this study must include an does require review and approval of the the source water except in cases where identification of species that are proposal by the Director. In general, the disruption is determined to be protected under Federal, State, or Tribal EPA expects that it would be submitted beneficial to the management of law (including threatened or well in advance of the other permit fisheries for fish and shellfish by any endangered species) that might be application materials, so that if the fishery management agency(ies) susceptible to impingement and Director determined that additional (§ 125.94(b)(4)(ii)). Typically, this entrainment by the cooling water intake information was needed to support the natural thermal stratification would be structure(s). The Director might application, the facility would have defined by the thermocline, which may coordinate a review of your list of time to collect this information, be affected to a certain extent by the threatened, endangered, or other including additional monitoring as withdrawal of cooler water and the protected species with the U.S. Fish and appropriate. In some cases, however, discharge of heated water into the Wildlife Service, National Marine where the facility intends to rely on system. This information demonstrates Fisheries Service, or other relevant existing data and there has been no to the permit writer that any increase in agencies to ensure that potential VerDate 11 impacts to these species have been 95 percent and entrainment by 60 to 90 information be submitted in the Design addressed. percent would be required to provide and Construction Technology Plan: (1) calculations estimating the reduction in A narrative description of the design d. Design and Construction Technology impingement mortality and entrainment and operation of all design and Plan (§ 125.96(b)(4)) of all life stages of fish and shellfish that construction technologies existing or If you choose to use existing and/or would be achieved through the use of proposed to reduce impingement proposed design and construction existing and/or proposed technologies mortality; (2) a narrative description of technologies or operational measures in or operational measures. In determining the design and operation of all design whole or in part to meet the compliance with any requirements to and construction technologies existing requirements of § 125.94, proposed reduce impingement mortality or or proposed to reduce entrainment; (3) § 125.95(b)(4) would require that you entrainment, you must first determine calculations of the reduction in develop and submit a Design and the calculation baseline against which impingement mortality and entrainment Construction Technology Plan with to assess the total reduction in of all life stages of fish and shellfish that your application that demonstrates that impingement mortality and would be achieved by the technologies your facility has selected and would entrainment. The calculation baseline is and operational measures you have implement the design and construction defined § 125.93 as an estimate of selected based on the Impingement technologies necessary to reduce impingement mortality and entrainment Mortality and Entrainment impingement mortality and/or that would occur at your site assuming Characterization Study in § 125.95(b)(3); entrainment to the levels required. The you had a shoreline cooling water intake (4) documentation which demonstrates Agency recognizes that selection of the structure with an intake capacity that you have selected the location, specific technology or group of commensurate with a once-through design, construction, and capacity of the technologies for your site would depend cooling water system and with no cooling water intake structure that on individual facility and waterbody impingement and/or entrainment reflects the best technology available for conditions. reduction controls. Reductions in meeting the applicable requirements in Phase II existing facilities seeking to impingement mortality and entrainment § 125.94; and (5) design calculations, avoid entrainment reduction from this calculation baseline as a result drawings, and estimates to support the requirements because their capacity of any design and construction narrative descriptions required by steps utilization rate is less than 15 percent, technologies already implemented at (1) and (2) above. would also be required to calculate and your facility would be added to the Today’s proposed rule allows for the submit the capacity utilization rate and reductions expected to be achieved by Director to evaluate, with information supporting data and calculations. The any additional design and construction submitted in your application, the data being requested include (1) the technologies that would be performance of any technologies you average annual net generation of the may have implemented in previous facility in (Mwh) measured over a five implemented in order to determine compliance with the performance permit terms. Additional or different year period (if available) and design and construction technologies representative of operating conditions standards. Facilities that recirculate a portion of their flow may take into may be required if the Director and (2) the net capacity of the facility determines that the initial technologies (in MW). These data are needed to account the reduction in impingement mortality and entrainment associated you selected and implemented would determine whether the facility has less not meet the requirements of § 125.94. than a 15 percent utilization rate and with the reduction in flow when would only be required to reduce determining the net reduction e. Information To Support Proposed impingement mortality in accordance associated with existing technology and Restoration Measures (§ 125.94(b)(5)) with § 125.94(b)(1). operational measures. This estimate Under proposed § 125.94(d), Phase II In its application, a Phase II existing must include a site-specific evaluation existing facilities subject to the facility choosing to use design and of the suitability of the technology(ies) proposed rule may propose to construction technologies or operational based on the species that are found at implement restoration measures in lieu measures to meet the requirements of the site, and/or operational measures of or in combination with design and § 125.94 would be required to describe and may be determined based on construction or operational measures to the technology(ies) or operational representative studies (i.e., studies that meet the performance standards in measures they would implement at the have been conducted at cooling water § 125.94(b) or site-specific requirements facility to reduce impingement mortality intake structures located in the same imposed under § 125.94(c). Facilities and entrainment based on information waterbody type with similar biological proposing to use restoration measures that demonstrates the efficacy of the characteristics) and/or site-specific would be required to submit the technologies for those species most technology prototype studies. following information to the Director for susceptible. Examples of appropriate If your facility already has some review as proposed in § 125.95(b)(5). technologies would include, but are not existing impingement mortality and The Director must approve any use of limited to, wedgewire screens, fine entrainment controls, you would need restoration measures. mesh screens, fish handling and return to estimate the calculation baseline. First, the Phase II existing facility systems, barrier nets, aquatic filter This calculation baseline could be must submit a list and narrative barrier systems, enlargement of the estimated by evaluating existing data description of the restoration measures cooling water intake structure to reduce from a facility nearby without the facility has selected and proposes to velocity. Examples of operational impingement and/or entrainment implement. This list and description measures include, but are not limited to, control technology (if relevant) or by should identify the species and other seasonal shutdowns or reductions in evaluating the abundance of organisms aquatic resources targeted under any flow, and continuous operations of in the source waterbody in the vicinity restoration measures. The facility also screens, etc. of the intake structure that may be must submit a summary of any past, Phase II existing facilities that are susceptible to impingement and/or ongoing, or voluntary consultation with required to meet the proposed ranges to entrainment. The proposed rule would appropriate Federal, State, and Tribal reduce impingement mortality by 80 to specifically require that the following fish and wildlife agencies regarding the VerDate 11 proposed restoration measures that is would continue for at least the term of justified because of the significantly relevant to the Comprehensive the permit. greater cost. Demonstration Study and a copy of any Finally, the facility must provide A Phase II existing facility that meets written comments received as a result of design and engineering calculations, one of the two cost tests described above such consultation. drawings, and maps documenting that must select less costly design and Second, the facility must submit a the proposed restoration measures construction technologies, operational quantification of the combined benefits would meet the restoration performance measures, and/or restoration measures from implementing design and standard at § 125.94(d). that would minimize adverse construction technologies, operational The proposed regulations at environmental impact to the extent measures and/or restoration measures § 125.98(b)(1)(ii) would require that this justified by the significantly greater cost. and the proportion of the benefits that information be reviewed by the Director In order to do this, Phase II existing can be attributed to each. This to determine whether the facilities that pursue this option would quantification must include: (1) The documentation demonstrates that the have to assess the nature and degree of percent reduction in impingement proposed restoration measures, in adverse environmental impact mortality and entrainment that would conjunction with design and associated with their cooling water be achieved through the use of any construction technologies and intake structures, and then identify the design and construction technologies or operational measures would maintain best technology available to minimize operational measures that the facility the fish and shellfish in the waterbody such impact. Phase II existing facilities would assess adverse environmental has selected (i.e., the benefits that to a level substantially similar to that would be achieved through impact associated with their cooling which would be achieved under impingement and entrainment water intake structures in the § 125.94. reduction); (2) a demonstration of the Comprehensive Demonstration Study benefits that could be attributed to the f. Information To Support Site-Specific that would be required to be submitted restoration measures selected; and (3) a Determination of Best Technology to the Director under § 125.95(b). This demonstration that the combined Available for Minimizing Adverse study would include source waterbody benefits of the design and construction Environmental Impact flow information, and a characterization technology(ies), operational measures, of impingement mortality and Under the third compliance option, and/or restoration measures would entrainment, as described in this section the owner or operator of a Phase II maintain fish and shellfish at a level of this preamble. comparable to that which you would existing facility may demonstrate to the Such facilities also must submit to the achieve were you to implement the Director that a site-specific Director for approval a Site-Specific requirements of § 125.94. They also determination of best technology Technology Plan. This plan would be must establish that biotic community available is appropriate for the cooling based on the Comprehensive Cost structure and function would be water intake structures at that facility if Evaluation Study and, for those maintained to a level comparable or the owner or operator can meet one of facilities seeking a site-specific substantially similar to that which the two cost tests specified under determination of best technology would be achieved through § 125.94 (b) § 125.94(c)(1). To be eligible to pursue available based on costs significantly or (c). this approach, the Phase II existing greater than benefits, a valuation of If it is not possible to demonstrate facility must first demonstrate to the monetized benefits (see Section VI.A). It quantitatively that restoration measures Director either (1) that its cost of would describe the design and such as creation of new habitats to serve compliance with the applicable operation of all design and construction as spawning or nursery areas or performance standards specified in technologies, operational measures, and establishment of riparian buffers would § 125.94(b) would be significantly restoration measures selected, and achieve comparable performance, a greater than the costs considered by the provide information that demonstrates facility may make a qualitative Administrator in establishing such the effectiveness of the selected demonstration that such measures performance standards, or (2) that the technologies or measures for reducing would maintain fish and shellfish in the existing facility’s costs would be the impacts on the species of concern. waterbody at a level substantially significantly greater than benefits of Existing facilities would be required to similar to that which would be achieved complying with the performance submit design calculations, drawings, under § 125.94. Any qualitative standards at the facility’s site. A and estimates to support these demonstration must be sufficiently discussion of applying this cost test is descriptions. This plan also would need substantive to support a demonstration provided in Section VI.A of this to include engineering estimates of the under § 125.94(d). proposed rule. Where a Phase II existing effectiveness of the technologies or Third, the facility must submit a plan facility demonstrates that it meets either measures for reducing impingement for implementing and maintaining the of these cost tests, the Director must mortality and entrainment of all life efficacy of the restoration measures it make a site-specific determination of stages of fish and shellfish. It also would has selected as well as supporting best technology available for need to include a site-specific documentation to show that the minimizing adverse environmental evaluation of the suitability of the restoration measures, or the restoration impact. This determination would be technologies or measures for reducing measures in combination with design based on less costly design and impingement mortality and entrainment and construction technology(ies) and construction technologies, operational based on representative studies and/or operational measures, would maintain measures, and/or restoration measures site-specific technology prototype the fish and shellfish in the waterbody, proposed by the facility and approved studies. Again, design calculations, including the community structure and by the Director. The Director can drawings and estimates would be function, to a level comparable or approve less costly technologies to the required to support such estimates. If a substantially similar to that which extent justified by the significantly Phase II existing facility intends to use would be achieved through § 125.94(b) greater cost, and could determine that restoration measures in its site-specific and (c). This plan should be sufficient technologies and measures in addition approach, it also must submit the to ensure that any beneficial effects to those already in place are not information required under VerDate 11 § 125.95(b)(5). See preamble Section sort of contract or arrangement with an entrainment reduction requirements in VII.B.4.e. Finally, the Site-Specific independent (supplier or multiple the proposed rule, the Director would Technology Plan would have to include suppliers) of cooling water if the need to (1) verify the facility’s baseline documentation that the technologies, supplier(s) withdraw(s) water from calculation; (2) confirm the location of operational measures or restoration waters of the U.S. and is not a public the facility’s cooling water intake measures selected would reduce water system? structure(s); (3) verify the withdrawal impingement mortality and entrainment (4) Is at least 25 percent of the water percentage of mean annual flow; (4) to the extent necessary to satisfy the withdrawn by the facility used for review impingement and/or requirements of § 125.94 (i.e., the level cooling purposes? entrainment rates or estimates; and (5) of performance would be reduced only (5) Does the facility have a design consider any use of restoration. These to the extent justified by the intake flow of 50 million gallons or same steps also would be part of significantly greater cost). more per day (MGD)? 70 determining requirements under (6) Does the facility discharge Options 2 and 3, as discussed below. g. Verification Monitoring Plan pollutants to waters of the U.S., The Director would initially review Finally, proposed § 125.95(b)(7) including storm water-only discharges, and verify the calculation baseline would require all Phase II existing such that the facility has or is required estimate submitted by the facility under facilities, except those deemed to meet to have an NPDES permit? § 125.95(b)(iii). This estimate must be the performance standard in The Director’s second step would be consistent with the proposed definition § 125.94(b)(1), to submit a Verification to determine whether the facility of the term ‘‘calculation baseline’’ and Monitoring Plan to measure the efficacy proposes to comply by demonstrating must be representative of current of the implemented design and that its existing design and construction biological conditions at the facility. The construction technologies, operational technologies, operational measures, or Director would then review the measures, and restoration measures. The restoration measures meet the proposed information that the facility provides to plan would include a monitoring study performance standards (Option 1); by validate the source waterbody type in lasting at least two years to verify the implementing design and construction which the cooling water intake structure full-scale performance of the proposed technologies, operational measures, or is located (freshwater river or stream; or already implemented technologies restoration measures that, in lake or reservoir; or estuary, tidal river, and of any additional operational and combination with existing technologies ocean, or Great Lake). The Director restoration measures. The plan would and operational measures, meet the would review the supporting material be required to describe the frequency of proposed performance standards the applicant provided in the permit monitoring and the parameters to be (Option 2); or by seeking a site-specific application to document the physical monitored and the bases for determining determination of best technology placement of the cooling water intake these. The Director would use the available to minimize adverse structure. For existing facilities with one verification monitoring to confirm that environmental impact (Option 3) (see, or more cooling water intake structures the facility is meeting the level of § 125.98(1)). The Director also would located in a freshwater river or stream, impingement mortality and entrainment need to determine whether the facility’s the Director would need to determine reduction expected and that fish and utilization rate is less than 15 percent, whether the facility withdraws more or shellfish are being maintained at the since such facilities are only subject to less than five percent of the mean level expected (as required in impingement mortality performance annual flow, which determines whether § 125.94(b)). Verification monitoring requirements. impingement, or impingement and would be required to begin once the Where a Phase II existing facility entrainment controls would apply. For technologies, operational measures, or selects Option 1 and chooses to facilities with cooling water intake supplemental restoration measures are demonstrate that its existing design and structures located on lakes or reservoirs implemented and continue for a construction technologies, operational other than a Great Lake for which the sufficient period of time (but at least measures, or restoration measures meet facility seeks to increase the design two years) to demonstrate that the the proposed performance standards, flow, the Director would need to facility is reducing impingement the Director would verify either that the determine whether the increased intake existing facility satisfies the reduced mortality and entrainment to the level of flow would disrupt the natural thermal intake capacity requirement, or that the reduction required at § 125.94(b) or (c). stratification or turnover pattern of the facility meets the impingement and source waterbody. In making this C. How Would the Director Determine entrainment reduction and other determination the Director would need the Appropriate Cooling Water Intake requirements. Facilities that have to consider anthropogenic factors that Structure Requirements? closed-cycle, recirculating cooling water can influence the occurrence and The Director’s first step would be to systems would meet the reduced intake location of a thermocline, and would determine whether the facility is capacity requirement, and would not be need to coordinate with appropriate covered by this rule. If the answer to all subject to further performance Federal, State, or Tribal fish and the following questions is yes, the standards. Other methods of reducing wildlife agencies to determine if the facility would be required to comply intake capacity also could be used but disruption is beneficial to the with the requirements of this proposed would need to be commensurate with management of the fisheries. Both of rule. the level that can be attained by a these determinations would be based on (1) Does the facility both generate and closed-cycle, recirculating cooling water the source waterbody flow information transmit electric power or generate system. required under proposed § 125.95(b)(2). electric power but sell it to another Under Option 1, to verify that existing For Phase II existing facilities that use entity for transmission? controls meet the impingement and or propose to implement restoration (2) Is the facility an ‘‘existing facility’’ measures to meet the requirements of as defined in § 125.93? 70 If the answer is no to these flow parameters and § 125.94(b), the Director would review yes to all the other questions, the Director would (3) Does the facility withdraw cooling use best professional judgment on a case-by-case the evaluation of any current or water from waters of the U.S.; or does basis to establish permit conditions that ensure proposed restoration measures the facility obtain cooling water by any compliance with section 316(b). submitted under proposed VerDate 11 § 125.95(b)(5). The Director could gather than currently meet) the applicable Such alternative technologies or additional information and solicit input performance standards. This review operational measures could be those for the review from appropriate fishery would also be based on data submitted proposed by the facility in the Site- management agencies as necessary. The in the Comprehensive Demonstration Specific Technology Plan, but less Director would need to determine Study required under § 125.95(b). protective requirements would have to whether the current or proposed These same basic steps also apply to be justified by the significantly greater measures would maintain the fish and facilities seeking to comply under costs. EPA is interested in ways to shellfish in the waterbody at Option 3, however, the Director must decrease application review time and comparable levels to those that would make two additional determinations make this process both efficient and be achieved under § 125.94, as well as under this option, including whether effective. review and approve the proposed the facility meets one of the applicable Verification and Monitoring Plan to cost tests and whether any alternative D. What Would I Be Required To ensure the restoration measures meet requirements are justified by Monitor? § 125.94(d) and 125.95(b)(3). significantly greater costs. Under Option Finally, the Director would review 3, a Director must first determine Proposed § 125.96 provides that Phase impingement and/or entrainment data whether a Phase II existing facility II existing facilities would have to or estimates to determine whether in- satisfies either of the cost tests proposed perform monitoring to demonstrate place or identified controls achieve the at § 125.94(c). Phase II existing facilities compliance with the requirements of performance standards proposed for the seeking to comply under this option are § 125.94 as prescribed by the Director. different categories of source required to submit a Comprehensive In establishing such monitoring waterbodies. This step would involve Cost Evaluation Study under requirements, the Director should comparing the calculation baseline with § 125.95(b)(6), which includes data that consider the need for biological the impingement and/or entrainment document the cost of implementing monitoring data, including data or estimates provided as part of the design and construction technologies or impingement and entrainment sampling Comprehensive Demonstration Study operational measures to meet the data sufficient to assess the presence, required under § 125.95(b) and the requirements of § 125.94, as well as the abundance, life stages, and mortality Impingement Mortality and Entrainment costs of alternative technologies or (including eggs, larvae, juveniles, and Characterization Study required under operational measures proposed. The adults) of aquatic organisms (fish and § 125.95(b)(3). It may also entail Director would need to review these shellfish) impinged or entrained during considering whether, how, and to what data, including detailed engineering operation of the cooling water intake extent restoration would allow the cost estimates, and compare these with structure. These data could be used by facility to meet applicable performance the costs the Agency considered in the Director in developing permit standards. establishing these requirements. Where conditions to determine whether If the Director determines that the the Director finds that the facility’s cost requirements, or additional Comprehensive Demonstration Study of implementation are significantly requirements, for design and submitted does not demonstrate that the greater than those considered during construction technologies or operational technologies, operational measures, and rule development, he or she must measures should be included in the supplemental restoration measures approve site-specific requirements and permit. The Director should ensure, employed would achieve compliance could approve alternative technologies where appropriate, that any required with the applicable performance or operational measures. Such sampling would allow for the detection standards, the Director may issue a alternative technologies or operational of any annual, seasonal, and diel permit requiring such compliance. If measures could be those proposed by variations in the species and numbers of such studies are approved and a permit the facility in the Site-Specific individuals that are impinged or is issued but the Director later Technology Plan, but less protective entrained. The Director should also determines, based on the results of requirements would have to be justified consider if a reduced frequency in subsequent monitoring, that the by the significantly greater costs. technologies, operational measures, and Where a Phase II existing facility biological monitoring may be justified supplemental restoration measures did seeks site-specific requirements based over time if the supporting data show not meet the rule standards, the Director on facility costs that are significantly that the technologies are consistently could require the existing facility to greater than the environmental benefits performing as projected under all implement additional technologies and of compliance, the facility must submit operating and environmental conditions operational measures as necessary to a Valuation of Monetized Benefits of and less frequent monitoring would still meet the rule requirements. In general, Reducing Impingement and allow for the detection of any future this would occur at the next renewal of Entrainment. The Director must review performance fluctuations. The Director the permit. The Director would also this valuation to determine whether it should further consider whether weekly review the facility’s Technology fully values the impacts of the cooling visual or remote or similar inspections Verification Plan for post-operational water intake structures at issue, as should be required to ensure that any monitoring to demonstrate that the required in § 125.95(b)(6)(ii), and technologies that have been technologies are performing as whether the facility’s cost of implemented to reduce impingement predicted. implementation are significantly greater mortality or entrainment are being Under compliance Option 2, the same than the environmental benefits of maintained and operated in a manner general steps would be followed as complying with the requirements of that ensures that they function as described above for assessing § 125.94. If the Director determines that designed. Monitoring requirements compliance of existing controls with the implementation costs are could be imposed on Phase II existing applicable performance standards significantly greater than the facilities that have been deemed to meet except that under this option the Phase environmental benefits, the Director the performance standard in II existing facility would be must approve site-specific requirements § 125.94(b)(1) to the extent consistent demonstrating that the technologies and and could approve alternative with the provisions of the NPDES measures identified would meet (rather technologies or operational measures. program. VerDate 11 E. How Would Compliance Be alternative regulatory requirements that applicant implementing applicable Determined? would result in environmental section 316(b) requirements pursuant to This proposed rule would be performance within each relevant this rule; and • Ensuring compliance with permit implemented by the Director placing watershed that is comparable to the conditions based on section 316(b) conditions consistent with this reductions in impingement mortality and entrainment that would be achieved requirements. proposed rule in NPDES permits. To EPA would implement these demonstrate compliance, the proposed under § 125.94. EPA invites comment on such ‘‘functionally equivalent’’ requirements where States or Tribes are rule would require that the following not authorized to implement the NPDES information be submitted to the programs. In particular, EPA invites comment on the proposed alternative program. EPA also would implement Director: these requirements where States or • Data submitted with the NPDES and on decision criteria EPA should consider in determining whether a State Tribes are authorized to implement the permit application to show that the NPDES program but do not have facility is in compliance with location, program is functionally equivalent. If EPA adopts such an approach, the sufficient authority to implement these design, construction, and capacity requirements. requirements; Agency would also need to specify the • Compliance monitoring data and process through which an existing State G. Are Permits for Existing Facilities records as prescribed by the Director. program is evaluated and whether such Subject to Requirements Under Other process can occur under the existing Proposed § 125.97 would require Federal Statutes? State program regulations or whether existing facilities to keep records and additional regulations to provide the EPA’s NPDES permitting regulations report compliance monitoring data in a evaluation criteria are needed. at 40 CFR 122.49 contain a list of yearly status report. In addition, Finally, EPA invites comment on the Federal laws that might apply to Directors may perform their own role of restoration and habitat federally issued NPDES permits. These compliance inspections as deemed enhancement projects as part of any include the Wild and Scenic Rivers Act, appropriate (see CFR 122.41). ‘‘functionally equivalent’’ State 16 U.S.C. 1273 et seq.; the National Historic Preservation Act of 1966, 16 F. What Are the Respective Federal, programs. U.S.C. 470 et seq.; the Endangered State, and Tribal Roles? In addition to updating their programs to be consistent with today’s proposed Species Act, 16 U.S.C. 1531 et seq.; the Section 316(b) requirements are rule, States and Tribes authorized to Coastal Zone Management Act, 16 implemented through NPDES permits. implement the NPDES program would U.S.C. 1451 et seq.; and the National Today’s proposed regulations would be required to implement the cooling Environmental Policy Act, 42 U.S.C. amend 40 CFR 123.25(a)(36) to add a water intake structure requirements 4321 et seq. See 40 CFR 122.49 for a requirement that authorized State and following promulgation of the proposed brief description of each of these laws. Tribal programs have sufficient legal regulations. The requirements would In addition, the provisions of the authority to implement today’s have to be implemented upon the Magnuson-Stevens Fishery requirements (40 CFR part 125, subpart issuance or reissuance of permits Conservation and Management Act, 16 J). Therefore, today’s proposed rule containing the requirements of proposed U.S.C. 1801 et seq., relating to essential would affect authorized State and Tribal subpart J. Duties of an authorized State fish habitat might be relevant. Nothing NPDES permit programs. Under 40 CFR or Tribe under this regulation may in this proposed rulemaking would 123.62(e), any existing approved section include authorize activities that are not in 402 permitting program must be revised • Review and verification of permit compliance with these or other to be consistent with new program application materials, including a applicable Federal laws. requirements within one year from the permit applicant’s determination of date of promulgation, unless the H. Alternative Site-Specific source waterbody classification and the Requirements NPDES-authorized State or Tribe must flow or volume of certain waterbodies at Today’s proposed rule would amend or enact a statute to make the the point of the intake; required revisions. If a State or Tribe • Determination of the standards in establish national requirements for must amend or enact a statute to § 125.94 that apply to the facility; Phase II existing facilities. EPA has conform with today’s proposed rule, the • Verification of a permit applicant’s taken into account all the information revision must be made within two years determination of whether it meets or that it was able to collect, develop, and of promulgation. States and Tribes exceeds the applicable performance solicit regarding the location, design, seeking new EPA authorization to standards; construction, and capacity of cooling implement the NPDES program must • Verification that a permit water intake structures at these existing comply with the requirements when applicant’s Design and Construction facilities. EPA concludes that these authorization is requested. Technology Plan demonstrates that the proposed requirements would reflect EPA recognizes that some States have proposed alternative technologies the best technology available for invested considerable effort in would reduce the impacts to fish and minimizing adverse environmental developing section 316(b) regulations shellfish to levels required; impact on a national level. In some and implementing programs. EPA is • Verification that a permit applicant cases, however, data that could affect proposing regulations that would allow meets the cost test and that permit the economic practicability of States to continue to use these programs conditions developed on a site-specific requirements might not have been by including in this national rule a basis are justified based on documented available to be considered by EPA provision that allows States to use their costs, and, if applicable, benefits; during the development of today’s existing program if the State establishes • Verification that a permit proposed rule. Therefore, where a that such programs would achieve applicant’s proposed restoration facility’s cost would be significantly comparable environmental performance. measures would meet regulatory greater than the cost considered by EPA Specifically, the proposed rule would standards; in establishing the applicable allow any State to demonstrate to the • Development of draft and final performance standards, proposed Administrator that it has adopted NPDES permit conditions for the § 125.94(c)(2) would require the Director VerDate 11 to make a site-specific determination of VIII. Economic Analysis and repermitting costs). This cost the best technology available based on EPA used an electricity market model, estimate does not include the costs of less costly design and construction the Integrated Planning Model 2000 administering the rule by permitting technologies, operational measures, (IPM 2000), to identify potential authorities and the federal government. and/or restoration measures. Less costly economic and operational impacts of Also excluded are compliance costs for 11 facilities that are projected to be technologies or measures would be various regulatory options considered baseline closures (see discussion allowable to the extent justified by the for proposal. Analyzed characteristics below). Including compliance costs for significantly greater cost. Similarly, include changes in capacity, generation, projected baseline closure facilities § 125.94(c)(3) provides that where an revenue, cost of generation, and would result in a total annualized existing facility’s cost would be electricity prices. These changes are compliance cost of approximately $182 significantly greater than the benefits of identified by comparing two scenarios: million. complying with the applicable (1) The base case scenario (in the performance standards, the Director absence of Section 316(b) regulation); 2. Economic Impacts must make a site-specific determination and (2) the post compliance scenario EPA used an electricity market model of the best technology available based (after the implementation of Section to account for the dynamic nature of the on less costly technologies or measures. 316(b) regulation). The results of these electricity market when analyzing the These provisions would allow the comparisons were used to assess the potential economic impacts of Section Director, in the permit development impacts of the proposed rule and two of 316(b) regulation. The IPM 2000 is a process, to set alternative best the five alternative regulatory options long-term general equilibrium model of technology available requirements that considered by EPA. The following the domestic electric power market are less stringent than the nationally sections present EPA’s economic which simulates the least-cost dispatch applicable requirements. analyses of the proposed rule and the solution for all generation assets in the alternative options. Under proposed § 125.94(c), market given a suite of user-specified 71 alternative requirements would not be A. Proposed Rule constraints. The impacts of granted based on a particular facility’s compliance with a given regulatory Today’s proposed rule would provide option are defined as the difference ability to pay for technologies that three compliance options for Phase II between the model output for the base would result in compliance with the existing facilities. Such facilities could: case scenario and the model output for requirements of proposed § 125.94. (1) Demonstrate that their existing the post-compliance scenario.72 Thus, so long as the costs of compliance cooling water intake structure design Due to the lead time required in are not significantly greater than the and construction technologies, running an integrated electricity market costs EPA considered and determined to operational measures, and/or restoration model, EPA first completed an be economically practicable, and are not measures meet the proposed electricity market model analysis of two significantly greater than the benefits of performance standards; (2) implement options with costs higher than those in compliance with the proposed design and construction technologies, today’s proposed option: the ‘‘Closed- performance standards, the ability of an operational measures, and/or restoration Cycle, Recirculating Wet Cooling based individual facility to pay in order to measures that meet the proposed on Waterbody type and Intake Capacity’’ attain compliance with the rule would performance standards; or (3) where the Option (waterbody/capacity-based not support the imposition of alternative facility can demonstrate that its costs of option) and the ‘‘Closed-Cycle, requirements. Conversely, if the costs of complying with the proposed Recirculating Wet Cooling Everywhere’’ compliance for a particular facility are performance standards are significantly Option (all cooling towers option). Both significantly higher than those greater than either the costs EPA of the analyzed options are more considered by EPA in establishing the considered in establishing these stringent in aggregate than the proposed presumptive performance standards, requirements or the benefits of meeting rule and provide a ceiling on its then regardless of the facility’s ability to the performance standards, seek a site- potential economic impacts. Because of afford the significantly higher costs, the specific determination of best limited time after final definition of the Director should make a site-specific technology available to minimize rule as proposed herein, EPA was determination of best technology adverse environmental impact. The unable to rerun the IPM model with an available based on less costly applicable performance standards are analytic option that completely matches technologies and measures to the extent described in Section VI.A., above. the proposed rule’s specifications. As a justified by the significantly higher Section VIII.A.1 below presents the result, EPA adopted a two-step costs. analysis of national costs associated approach for the aggregate impact with the proposed section 316(b) Phase analysis. First, EPA identified that for The burden is on the person II Rule. Section VIII.A.2 presents a certain regional electricity markets that requesting the site-specific alternative discussion of the impact analysis of the requirement to demonstrate that proposed rule at the market level and 71 For a more detailed description of IPM 2000 see alternative requirements should be for facilities subject to this rule. the EBA document. imposed and that the appropriate 72 The IPM model simulates electricity market requirements of proposed § 125.94 have 1. Costs function for a period of 25 years. Model output is provided for five user specified model run years. been met. The person requesting the EPA estimates that facilities subject to EPA selected three run years to provide output site-specific alternative requirements this proposed rule will incur annualized across the ten year compliance period for the rule. should refer to all relevant information, Analyses of regulatory options are based on output post-tax compliance costs of for model run years which reflect a scenario in including the support documents for approximately $178 million. These costs which all facilities are operating in their post- this proposed rulemaking, all associated include one-time technology costs of compliance condition. Options requiring the data collected for use in developing complying with the rule, annual installation of cooling towers are analyzed using each requirement, and other relevant output from model run year 2013. All other options operating and maintenance costs, and are analyzed using output from model run years information that is kept on public file by permitting costs (including initial 2008. See the EBA document for a detailed EPA. permit costs, annual monitoring costs, discussion of IPM 2000 model run years. VerDate 11 do not have any facilities costed with a Therefore, EPA believes that the between NERC regions modeled in IPM closed-cycle recirculating cooling water proposed option, which would apply 2000, EPA concludes that the impacts system, the waterbody/capacity-based the same requirements (e.g., based on modeled for the alternative waterbody/ option, as analyzed, matches the technologies such as fine mesh screens, capacity-based option would be technology compliance requirements of filter fabric barrier nets, or fish return representative of potential impacts the proposed rule.73 These are the North systems) to facilities in all NERC associated with the proposed rule for American Electric Reliability Council regions, would, in total, have very small each of these regions. or no impacts. The remainder of this (NERC) regions that do not border Five measures developed from the section presents an assessment of the oceans and estuaries: ECAR, MAIN, IPM 2000 output are used to assess 74 impacts of the proposed rule using the MAPP, SPP. Accordingly, EPA was market level impacts associated with market and Phase II existing facility- able to interpret the results of the IPM Section 316(b) regulation: (1) Total level results from the IPM 2000 analysis analysis for the waterbody/capacity- capacity, defined as the total available based option for these four NERC of the alternative waterbody/capacity- based option for these four NERC capacity of all facilities not identified as regions as representative of the either baseline closures or economic proposed rule in these regions. As regions. A more detailed analysis of all NERC regions under the alternative closures resulting from the regulatory shown below, EPA found very small or waterbody/capacity-based option is option; (2) new capacity, defined as no impacts in these NERC regions. presented in Section VIII.B.2 below. total capacity additions from new Second, EPA identified and compared facilities; (3) total generation, calculated data relevant to determination of rule i. Market Level Impacts as the sum of generation from all impacts for these four NERC regions and This section presents the results of the facilities not identified as baseline the remaining NERC regions for which IPM 2000 analysis for the four NERC closures or economic closures resulting the IPM analysis would not be regions with no cooling tower from the regulatory option; (4) indicative of the proposed rule. Finding requirements under the alternative production costs per MWh of no material differences in these waterbody/capacity-based option: generation, calculated as the sum of underlying characteristics between the ECAR, MAIN, MAPP, and SPP.75 As total fuel and variable O&M costs two groups of NERC regions, EPA indicated above, the compliance divided by total generation; and (5) concluded that the finding of no requirements of this analyzed option are energy prices, defined as the prices significant impacts from the IPM-based identical to those of the proposed rule received by facilities for the sale of analysis of the four NERC regions for these four regions. Given the electricity. Exhibit 6 presents the base identified above, could also be extended similarity in compliance requirements case and post compliance results for to the remaining six NERC regions. and the limited electricity exchanges each of these economic measures. EXHIBIT 6.—MARKET-LEVEL IMPACTS OF THE PROPOSED RULE [Four Nerc Regions; 2008] NERC region Base case Option 1 Difference % Change (ECAR) Total Capacity (MW) ...... 118,390 118,570 180 0.2 New Capacity (MW) ...... 8,310 8,490 180 2.2 Total Generation (GWh) ...... 649,140 649,140 0 0.0 Production Costs ($2001/MWh) ...... $12.53 $12.53 $0.00 0.0 Energy Prices ($2001/MWh) ...... $22.58 $22.56 ($0.02) ¥0.1 (MAIN) Total Capacity (MW) ...... 60,230 60,210 ¥20 0.0 New Capacity (MW) ...... 6,540 6,530 ¥10 ¥0.2 Total Generation (GWh) ...... 284,920 284,860 ¥60 0.0 Production Costs ($2001/MWh) ...... $12.29 $12.29 $0.00 0.0 Energy Prices ($2001/MWh) ...... $22.54 $22.55 $0.01 0.0 (MAPP) Total Capacity (MW) ...... 35,470 35,470 0 0.0 New Capacity (MW) ...... 2,760 2,760 0 0.0 Total Generation (GWh) ...... 179,110 179,170 60 0.0 Production Costs ($2001/MWh) ...... $11.67 $11.68 $0.01 0.0 Energy Prices ($2001/MWh) ...... $22.25 $22.20 ($0.05) ¥0.2 (SPP) Total Capacity (MW) ...... 49,110 49,110 0 0.0 New Capacity (MW) ...... 160 160 0 0.0 73 While the compliance requirements are are representative of impacts that could be expected includes the states of Nebraska and North Dakota, identical under the proposed rule and the under the proposed rule. and portions of Iowa, South Dakota, Wisconsin, alternative waterbody/capacity-based option, 74 ECAR (East Central Area Reliability Montana and Minnesota. SPP (Southwest Power permitting costs associated with the proposed rule Coordination Agreement) includes the states of Pool) includes the states of Kansas and Oklahoma, are higher than those for the alternative option Kentucky, Ohio, and West Virginia, and portions of and portions of Arkansas, Louisiana, Texas, and analyzed using the IPM 2000. The cost differential Michigan, Maryland, Virginia, and Pennsylvania. New Mexico. averages approximately 30 percent of total MAIN (Mid-America Interconnected Network, Inc.) 75 The market level results include results for all compliance costs associated with the alternative includes the state of Illinois and portions of units located in each of the four NERC regions option. Despite the higher permitting costs, EPA Missouri, Wisconsin, Iowa, Minnesota and including facilities both in scope and out of scope concludes that the results of the alternative analysis Michigan. MAPP (Mid-Continent Area Power Pool) of the alternative waterbody/capacity-based option. VerDate 11 EXHIBIT 6.—MARKET-LEVEL IMPACTS OF THE PROPOSED RULE—Continued [Four Nerc Regions; 2008] NERC region Base case Option 1 Difference % Change Total Generation (GWh) ...... 217,670 217,750 80 0.0 Production Costs ($2001/MWh) ...... $14.43 $14.43 $0.00 0.0 Energy Prices ($2001/MWh) ...... $25.00 $24.99 ($0.01) 0.0% The results presented in Exhibit 6 Energy prices also decreased slightly in rule impacts in these remaining six reveal no significant changes in any of MAPP despite no appreciable difference regions. To provide an alternative the economic measures used to assess in any other measure for that region. approach to estimating the rule’s the impacts of the alternative Based on these results, EPA concludes impacts in these regions, EPA compared waterbody/capacity-based option in any that there are no significant impacts characteristics relevant to the of the four NERC regions.76 One region, associated with the proposed section determination of rule impacts for the SPP, experienced no change of any 316(b) Phase II Rule in these regions. four NERC regions explicitly analyzed consequence to any of the five impact While the waterbody/capacity-based in the IPM analysis and the six NERC option, as analyzed in IPM, matches the measures as a result of the alternative regions for which the IPM analysis technology specifications of the option. Post compliance changes in total otherwise overstates impacts. EPA proposed rule for the four regions capacity and new capacity were discussed above, this is not the case for found no material differences between experienced in both ECAR and MAIN. the other six NERC regions: ERCOT, the two groups of regions in (1) the Each of these measures decreased by FRCC, MAAC, NPCC, SERC, and percentage of total base case capacity insignificant amounts in MAIN while WSCC.77 Under the waterbody/capacity- subject to the proposed rule, (2) the ratio ECAR experienced a slight increase of based option, as analyzed, some of the annualized compliance costs of 0.2 percent in total capacity and a facilities in these regions were analyzed the proposed rule to total base case slightly larger increase of 2.2 percent in with more stringent and costly generation, and (3) the compliance new capacity additions. While the slight compliance requirements, including requirements of the proposed rule (see increases in total and new capacity seen recirculating wet cooling towers, than Exhibit 7 below). EPA therefore in ECAR did not result in changes in would required by the proposed rule. As concludes that the results for the four either generation or production costs, a result, the IPM waterbody/capacity- regions would be representative of the energy prices did decrease slightly. based option overstates the expected other NERC regions as well.78 EXHIBIT 7.—COMPARISON OF COMPLIANCE REQUIREMENTS BY NERC REGION—2008 Total Percentage of facilities subject to each compliance requirement—proposed rule Percent of annualized total capacity compliance Both impinge- NERC region subject to the cost per MWh ment and en- Entrainment Impingement None rule generation Total facilities trainment con- controls only controls only (percent) ($2001) trols (percent) (percent) ECAR ...... 66.5 0.05 99 32.4 7.1 23.9 36.6 MAIN ...... 60.9 0.04 49 30.6 6.1 22.7 40.7 MAPP ...... 42.1 0.04 42 9.5 7.1 28.5 54.8 SPP ...... 40.7 0.03 32 12.6 0.0 46.9 40.5 Average ...... 57.1 0.04 ...... 24.8 5.8 27.8 41.5 ERCOT ...... 57.8 0.04 51 2.0 11.8 60.8 25.5 FRCC ...... 49.8 0.07 30 40.0 13.3 16.7 30.0 MAAC ...... 50.7 0.06 43 26.2 19.1 28.8 25.9 NPCC ...... 49.6 0.08 54 22.1 34.2 16.5 27.1 SERC ...... 53.8 0.03 95 16.8 7.4 31.6 44.2 WSCC ...... 18.3 0.02 33 52.9 3.0 16.6 27.5 Average ...... 43.6 0.04 ...... 22.8 14.6 30.3 32.3 Average of All NERC Regions ...... 47.7 0.04 ...... 23.6 10.9 29.3 36.2 76 In addition to the five impact measures of the alternative waterbody/capacity based option the section 316(b) Phase II rule, nine are not presented in Exhibit 6, EPA utilized IPM 2000 to see section VIII.B.2 and the EBA document. modeled in the IPM 2000: Three facilities are in identify changes in other economic and operational 77 The six other NERC regions are: Electric Hawaii, and one is in Alaska. Neither state is characterisitcs, including revenues, average fuel Reliability Council of Texas (ERCOT), Florida represented in the IPM 2000. One facility is costs, changes in repowering, and the number and Reliability Coordinating Council (FRCC), Mid identified as an ‘‘Unspecified Resource’’ and does capacity of facilities identfiied as economic Atlantic Area Council (MAAC), Northeast Power not report on any EIA forms. Four facilities are on- closures. The IPM results showed no economic Coordination Council (NPCC), Southeastern site facilities that do not provide electricity to the closures and no changes in repowering associated Electricity Reliability Council (SERC), and Western grid. The 530 existing facilities were weighted to with compliance with the alternative waterbody/ Systems Coordinating Council (WSCC). account for facilities not sampled and facilities that capacity-based option in any of the four NERC 78 The comparison presented in Exhibit 7 did not respond to the EAP’s industry survey and regions presented in Exhibit 6. For a detailed includes information for facilities modeled in IPM thus represent a total of 540 facilities industry- discussion of the results of the IPM 2000 analysis 2000 only. Of the 539 existing facilities subject to wide. VerDate 11 Exhibit 7 indicates that, on average, NERC region associated with the EPA used output from model run year the percentage of total capacity is proposed rule. 2008 to develop four measures used to slightly higher and the percentage of identify changes in the economic and ii. Impacts on Facilities Subject to the facilities subject to the proposed rule is operational characteristics of the group Proposed Rule slightly lower in the four analyzed of Phase II existing facilities. These NERC regions compared to the other six This section presents the results of the measures include: (1) Total capacity, regions. In addition, the average facility impact analysis for the proposed defined as the total available capacity of all facilities not identified as either annualized compliance costs per MWh rule, again using the IPM 2000 analysis baseline closures or economic closures of generation is very similar in all NERC of the alternative waterbody/capacity- resulting from the regulatory option; (2) regions. Based on this comparison and based option for the four NERC regions total generation, calculated as the sum the limited amount electricity where the compliance requirements of exchanges between regions modeled in of generation from all facilities not the proposed rule and the analyzed identified as baseline closures or IPM 2000, EPA concluded that the 79 option are identical. EPA used the economic closures resulting from the analysis of impacts under the proposed IPM 2000 results to analyze two regulatory option; (3) revenues, rule for the four NERC regions is potential facility level impacts of the calculated as the sum of energy and representative of likely impacts in the proposed section 316(b) Phase II Rule: capacity revenues; and (4) production other NERC regions. As the analysis of (1) potential changes in the economic costs per MWh of generation, calculated the impacts of the alternative and operational characteristics of the as the sum of total fuel and variable waterbody/capacity-based option group of Phase II existing facilities and O&M costs divided by total generation. revealed no significant impacts at the (2) potential changes to individual Exhibit 8 presents the base case and market level, EPA concluded that there facilities within the group of Phase II post compliance results for each of these would be no significant impacts on any existing facilities. economic measures. EXHIBIT 8.—IMPACTS ON PHASE II EXISTING FACILITIES OF THE PROPOSED RULE [Four NERC Regions; 2008] Proposed Base case rule Difference % Change (ECAR) Total Capacity (MW) ...... 78,710 78,710 0.00 0.0 Total Generation (GWh) ...... 515,020 515,030 10.00 0.0 Revenues (Million $2001) ...... $17,650 $17,650 0.00 0.0 Production Costs ($2001/MWh) ...... $12.34 $12.34 0.00 0.0 (MAIN) Total Capacity (MW) ...... 36,700 36,700 0.00 0.0 Total Generation (GWh) ...... 226,360 226,350 ¥10.00 0.0 Revenues (Million $2001) ...... $7,890 $7,890 0.00 0.0 Production Costs ($2001/MWh) ...... $11.74 $11.74 0.00 0.0 (MAPP) Total Capacity (MW) ...... 14,920 14,920 0.00 0.0 Total Generation (GWh) ...... 103,430 103,470 40.00 0.0 Revenues (Million $2001) ...... $3,420 $3,420 0.00 0.0 Production Costs ($2001/MWh) ...... $11.78 $11.78 0.00 0.0 (SPP) Total Capacity (MW) ...... 19,990 19,990 0.00 0.0 Total Generation (GWh) ...... 112,250 112,350 100.00 0.1 Revenues (Million $2001) ...... $3,930 $3,930 0.00 0.0 Production Costs ($2001/MWh) ...... $13.32 $13.34 0.01 0.1 Note: Total capacity, total generation, and revenues have been rounded to the closest 10. The results for the four NERC regions increase or decrease in generation of EPA concludes that the proposed rule presented in Exhibit 8 reveal no more than one tenth of one percent. will not pose significant impacts in any significant changes in any of the Similarly, there was no significant NERC region. economic measures used to assess the change to the production costs of Phase While the group of Phase II existing impacts of the alternative waterbody/ II existing facilities in any of the facilities as a whole is not expected to capacity-based option to the group of analyzed regions. Given EPA’s earlier experience impacts under the proposed Phase II existing facilities. None of the noted finding of no material differences rule, it is possible that there would be four NERC regions analyzed between these four NERC regions and shifts in economic performance among experienced any post compliance the remaining six NERC regions in individual facilities subject to this rule. change in either capacity or revenues. important characteristics relevant to To examine the range of possible Further, while there were some rule impacts, EPA again concluded that impacts to individual Phase II existing variations in total generation derived the finding of no significant impact for facilities, EPA analyzed facility-specific from Phase II existing facilities in these these four regions could be extended to changes in generation, production costs, regions, no region experienced an the remaining six regions. As a result, capacity utilization, revenue, and 79 These results only pertain to the steam electric thus do not provide complete measures for facilities with both steam electric and non-steam electric component of the Phase II existing facilities and generation. VerDate 11 operating income. Exhibit 9 presents the regions by category of change for each number of Phase II existing facilities economic measure. located in the four analyzed NERC EXHIBIT 9.—OPERATIONAL CHANGES AT PHASE II EXISTING FACILITIES FROM THE PROPOSED RULE [Four NERC Regions; 2008] Reduction Increase Economic measures No change 0–1% 1% 0–1% 1% Change in Generation ...... 2 0 1 2 218 Change in Production Costs ...... 0 0 27 0 178 Change in Capacity Utilization ...... 2 0 2 1 218 Change in Revenue ...... 56 0 44 2 121 Change in-Operating Income ...... 66 0 58 1 98 Note: IPM 2000 output for run year 2008 provides data for 223 Phase II existing facilities located in the four NERC regions with identical com- pliance requirements under the alternative option and proposed rule. Eighteen facilities had zero generation in either the base case or post com- pliance scenario. As such it was not possible to calculate production costs in dollars per MWh of generation for these facilities. For all measures, the percentages used to assign facilities to impact categories have been rounded to the nearest 10th of a percent. Exhibit 9 shows that there is almost VIII.B.2 discusses the impacts System based on Waterbody Type/ no shift in economic activity between associated with these two alternative Capacity’’ Option (waterbody/capacity- facilities subject to this rule in the four regulatory options. based option) and (2) the ‘‘Intake analyzed NERC regions. No facility Capacity Commensurate with Closed- 1. Costs experiences a decrease in generation, Cycle, Recirculating Cooling System for capacity utilization, revenues, or EPA estimated total national All Facilities’’ Option (all closed-cycle operating income, or an increase in annualized post-tax cost of compliance option). This section presents the results production costs of more than one for two alternative options: (1) The of the IPM 2000 analysis of these two percent. These findings, together with ‘‘Intake Capacity Commensurate with post-compliance scenarios. the findings from the comparison of Closed-Cycle, Recirculating Cooling a. Intake Capacity Commensurate With compliance costs and requirements System based on Waterbody Type/ Closed-Cycle, Recirculating Cooling across all regions above, further confirm Capacity’’ Option (waterbody/capacity- System Based on Waterbody Type/ EPA’s conclusion that the proposed rule based option) and (2) the ‘‘Intake Capacity would not result in economic impacts to Capacity Commensurate with Closed- Phase II existing facilities located in the Cycle, Recirculating Cooling System for This section presents the market level four analyzed NERC regions. All Facilities’’ Option (all closed-cycle and Phase II existing facility level option). The estimated total annualized impacts of the alternative waterbody/ B. Alternative Regulatory Options post-tax cost of compliance for the capacity-based option. This option EPA is considering four alternative waterbody/capacity-based option is would require facilities that withdraw options that would establish substantive approximately $585 million. EPA water from an estuary, tidal river, or requirements for best technology further estimates that the total ocean and that meet certain intake flow available for minimizing adverse annualized post-tax cost of compliance requirements, to reduce their intake environmental impact by specific rule for the all cooling tower option is capacity to a level that can be attained rather than by site-specific analysis. approximately $2.26 billion. Not by a closed-cycle, recirculating cooling These include: (1) Requiring existing included in either estimate are 9 system. This requirement would be met facilities located on estuaries and tidal facilities that are projected to be within five to ten years of promulgation rivers to reduce intake capacity baseline closures. Including compliance of the final rule (2004 to 2012) commensurate with the use of a closed- costs for these 9 facilities would depending on when a permittee’s first cycle recirculating cooling system; (2) increase the total cost of compliance NPDES permit after promulgation requiring all Phase II existing facilities with the waterbody/capacity-based expires. The impacts of compliance to reduce intake capacity commensurate option to approximately $595 million, with this option are calculated using with the use of closed-cycle, and to roughly $2.32 billion for the all base case and post compliance results recirculating cooling systems; (3) cooling tower option. for model run year 2013. This run year requiring all Phase II existing facilities reflects the long-term operational 2. Economic Impacts to reduce impingement and entrainment changes of the regulatory option with all to levels established based on the use of As stated in Section VIII.A.2 above, in-scope facilities operating in their post design and construction (e.g., fine mesh EPA used the IPM 2000 electricity compliance condition. screens, fish return systems) or market model to assess impacts (1) Market Level Impacts operational measures; and (4) requiring associated with the proposed rule and all existing facilities to reduce their regulatory options. These impacts are EPA used five measures to identify intake capacity to a level commensurate assessed by comparing model output for changes to economic and operational with the use of a dry cooling system. the base case and post compliance characteristics of existing facilities and EPA conducted an electricity market scenarios for each regulatory option. In assess market level impacts due to model analysis of alternative options support of this rule, EPA completed an compliance with the alternative one and two as defined above. Section electricity market model analysis of two waterbody/capacity-based option: (1) VIII.B.1 below presents the national post compliance scenarios: (1) The Capacity retirements, calculated as the costs of these two alternative regulatory ‘‘Intake Capacity Commensurate with total capacity of facilities identified as options considered by EPA. Section Closed-Cycle, Recirculating Cooling economic closures due to the alternative VerDate 11 option; (2) capacity retirements as a generation; (4) post compliance changes capacity prices are defined as the price percentage of baseline capacity; (3) post in energy price, where energy prices are paid to facilities for making unloaded compliance changes in total production defined as the prices received by capacity available as reserves to ensure costs per MWh, where production costs facilities for the sale of electric system reliability. Exhibit 10 presents are calculated as the sum of total fuel generation; and (5) post compliance the market level summary of these and variable O&M costs divided by total changes in capacity price, where impact measures by NERC region. EXHIBIT 10.—MARKET-LEVEL IMPACTS OF THE ALTERNATIVE WATERBODY/CAPACITY-BASED OPTION (2013) Change in pro- Change in en- Change in ca- Baseline ca- Capacity clo- Closures as % duction cost ergy price pacity price NERC region pacity sures of baseline ca- ($/MWh) ($/MWh) ($/MWh) (MW) (MW) pacity (percent) (percent) (percent) ECAR ...... 122,080 0 0.0 0.0 0.0 ¥0.2 ERCOT ...... 80,230 0 0.0 0.0 0.0 ¥0.2 FRCC ...... 52,850 0 0.0 0.4 0.5 ¥2.0 MAAC ...... 65,270 0 0.0 0.7 0.6 ¥1.5 MAIN ...... 61,380 0 0.0 0.2 0.1 ¥0.1 MAPP ...... 36,660 0 0.0 0.0 0.0 ¥0.1 NPCC ...... 74,080 840 1.1 0.5 ¥0.3 13.2 SERC ...... 205,210 0 0.0 0.1 0.0 0.0 SPP ...... 51,380 0 0.0 0.0 0.0 0.0 WSCC ...... 173,600 2,170 1.3 1.9 ¥0.1 2.0 Total ...... 922,740 3,010 0.3 0.5 n/a n/a Note: Baseline Capacity and Closure Capacity have been rounded to the nearest 10 MW. Exhibit 10 shows that with the regions would experience slight (2) Phase II Existing Facility Level exception of an increase in the capacity increases in production costs per MWh. Impacts price paid in NPCC, no significant Production cost per MWh in WSCC The IPM 2000 results from model run change in market-level operation would would increase the most, by almost 2 year 2013 were used to analyze two result from the alternative waterbody/ percent. In addition, three NERC regions potential facility level impacts capacity-based option. Two of the ten would experience a slight increase in associated with the alternative NERC regions modeled, NPCC and energy price while NPCC and WSCC waterbody/capacity-based option: (1) WSCC, would experience economic both would both see a slight decrease in Potential changes in the economic and closures of existing facilities as a result post compliance energy prices due to operational characteristics of the group of the alternative option. However, these the economic closure of existing of Phase II existing facilities and (2) closures represent an insignificant capacity. Further, NPCC and WSCC are potential changes to individual facilities percentage of total baseline capacity in the only regions that would experience within the group of Phase II existing these regions (1.1 percent and 1.3 an increase in capacity price. The facilities. EPA analyzed economic percent respectively). Of the capacity increase in capacity prices would be the closures and changes in production retirements in NPCC, 400 MW would be highest in NPCC with 13.2 percent. costs to assess impacts to all Phase II nuclear capacity and 440 MW would be existing facilities resulting from the oil/gas-fired capacity. The vast majority alternative option. Exhibit 11 below of the closures in WSCC, 2,150 MW, presents the results from this analysis, represents nuclear capacity. Six NERC by NERC region. EXHIBIT 11.—IMPACTS ON PHASE II EXISTING FACILITIES OF THE ALTERNATIVE WATERBODY/CAPACITY-BASED OPTION (2013) Closure Analysis Change in pro- NERC region Baseline ca- Percent of duction cost pacity (MW) # Facilities Capacity (MW) baseline ($/MWh) capacity (percent) ECAR ...... 78,680 0 0 0.0 ¥0.1 ERCOT ...... 42,330 0 0 0.0 0.0 FRCC ...... 24,460 0 0 0.0 0.7 MAAC ...... 30,310 0 0 0.0 0.0 MAIN ...... 33,650 0 0 0.0 0.0 MAPP ...... 14,900 0 0 0.0 0.0 NPCC ...... 36,360 (1) 650 1.8 ¥0.2 SERC ...... 100,780 0 0 0.0 0.0 SPP ...... 19,990 0 0 0.0 0.0 WSCC ...... 30,110 2 2,170 7.2 3.9 Total ...... 411,570 1 2,820 0.7 ¥0.3 Note: Baseline Capacity and Closure Capacity have been rounded to the nearest 10 MW. VerDate 11 Exhibit 11 shows that impacts under fewer than under the base case is While the group of Phase II existing the waterbody/capacity-based option projected to retire: Two facilities that facilities as a whole is not expected to would be small. Similar to the market would have retired in the baseline experience impacts under the level, WSCC and NPCC are the only remain operational under the analyzed waterbody/capacity-based option, it is regions that would experience capacity option, because their compliance costs possible that there would be shifts in retirements at Phase II existing facilities are low compared to that of other economic performance among under this regulatory option. It should facilities in the same region and they individual facilities subject to this rule. be noted that retirements presented in would therefore become relatively more To assess potential distributional these exhibits are net retirements, profitable. WSCC is the other region effects, EPA analyzed facility-specific accounting for both a potential increase with projected Phase II retirements changes in generation, production costs, and decrease in the number of under this option. The combined capacity utilization, revenue, and retirements, post compliance. For capacity retirements of both regions operating income. Exhibit 12 presents example, NPCC is projected to the total number of Phase II existing would be 2,820 MW, or 0.7 percent of experience a capacity loss of 650 MW facilities with different degrees of all Phase II capacity. under this option. However, one facility change in each of these measures. 80 EXHIBIT 12.—OPERATIONAL CHANGES AT PHASE II EXISTING FACILITIES FROM THE WATERBODY/CAPACITY-BASED OPTION (2013) Reduction Increase Economic measures No change 0–1% 1–3% >3% 0–1% 1–3% >3% Change in Generation ...... 7 17 21 4 4 9 444 Change in Production Costs ...... 6 5 1 13 16 3 380 Change in Capacity Utilization ...... 10 7 12 7 3 5 462 Change in Revenue ...... 57 43 17 48 15 20 306 Change in Operating Income ...... 75 42 10 46 15 22 296 Note: IPM 2000 output for model run year 2013 provides output for 506 Phase II existing facilities. Eighty-two facilities had zero generation in either the base case or post compliance scenario. As such it was not possible to calculate production costs in dollars per MWh of generation for these facilities. For all measures percentages used to assign facilities to impact categories have been rounded to the nearest 10th of a percent. Exhibit 12 indicates that the majority impingement and entrainment to b. Intake Capacity Commensurate with of Phase II existing facilities would not comparable levels that would be Closed-Cycle, Recirculating Cooling experience changes in generation, achieved with a closed-cycle System for All Facilities production costs, or capacity utilization recirculating system. EPA’s estimation due to compliance with the alternative of impacts associated with the This section presents the market level option. Of those facilities with changes alternative waterbody/capacity-based and Phase II existing facility level in post compliance generation and option is based on an electricity market impacts of the closed-cycle, capacity utilization, most would model analysis that assumes all recirculating wet cooling everywhere experience decreases in these measures. facilities withdrawing water from an option. This option requires that In addition, while approximately 40 estuary, tidal river, or ocean choose to existing facilities with a design intake percent of Phase II existing facilities comply with the requirements of Track flow 50 MGD or more reduce their total would experience an increase or I. While these impacts represent the design intake flow to a level that can be decrease in revenues and/or operating worst case scenario under this option, it attained by a closed-cycle recirculating income, the magnitude of such changes is reasonable to assume that a number cooling water system. In addition, would be small. of facilities would choose to comply facilities in specified circumstances Under the alternative waterbody/ with the requirements of Track II. EPA would have to install design and capacity-based option, facilities therefore also considered an additional construction technologies to minimize withdrawing water from an estuary, scenario in which 33 of the 54 existing impingement mortality and tidal river, or ocean are required to meet facilities costed with a cooling tower, or entrainment. Existing facilities would be standards for reducing impingement required to comply within five to ten mortality and entrainment based on the 61 percent, would choose to comply with the requirements of Track II. While years of promulgation of the final rule performance of wet cooling towers. (2004 to 2012) depending on when a These facilities would have the choice this scenario was not explicitly analyzed, the absence of significant permittee’s first NPDES permit after to comply with Track I or Track II promulgation expires. The impacts of requirements. Facilities that choose to impacts under the more expensive scenario, where all 54 facilities are compliance with this option are comply with Track I would be required calculated using base case and post to reduce their intake flow to a level costed with cooling towers, suggests the compliance results for model run year commensurate with that which can be alternative scenario would have similar 2013 in order to reflect the long-term attained by a closed-cycle, recirculating or lower impacts. system. Facilities that choose to comply operational changes of the rule with all with Track II would have to in-scope facilities operating in their post demonstrate that alternative compliance condition. technologies would reduce 80 Note that the facility-level exhibit excludes in- facilities that repower) to allow for a better separately in this section and the supporting scope facilities with significant status changes comparison of operational changes as a result of the Economic and Benefits Analysis Document. (including baseline closures, avoided closures, and analyzed option. Status changes are discussed VerDate 11 (1) Market Level Impacts compliance with the all cooling towers capacity, and post compliance changes EPA used IPM output to examine option. The measures used to assess in total production costs per MWh, changes to economic and operational market level responses to this option energy price, and capacity price. Exhibit characteristics of existing facilities and include capacity retirements, capacity 13 presents the market level summary of to assess market level impacts due to retirements as a percentage of baseline these impact measures by NERC region. EXHIBIT 13.—MARKET-LEVEL IMPACTS OF THE ALTERNATIVE ALL COOLING TOWERS OPTION (2013) Closures as % of Change in produc- Change in energy Change in capac- NERC region Baseline capacity Capacity closures baseline capacity tion cost ($/MWh) price ($/MWh) ity price ($/MWh) (MW) (MW) percent percent percent percent ECAR ...... 122,080 2,190 1.8 2.4 1.9 0.7 ERCOT ...... 80,230 510 0.6 0.3 0.4 ¥0.1 FRCC ...... 52,850 90 0.2 0.7 1.1 ¥3.8 MAAC ...... 65,270 0 0.0 1.8 0.6 ¥0.2 MAIN ...... 61,380 490 0.8 2.3 0.9 0.3 MAPP ...... 36,660 0 0.0 1.0 0.1 3.0 NPCC ...... 74,080 890 1.2 1.0 0.1 16.6 SERC ...... 205,210 0 0.0 1.2 0.4 0.0 SPP ...... 51,380 20 0.0 0.5 0.3 ¥0.7 WSCC ...... 173,600 2,370 1.4 1.9 0.1 1.0 Total ...... 922,740 6,560 0.7 1.4 Note: Baseline Capacity and Closure Capacity have been rounded to the nearest 10 MW. Exhibit 13 indicates that, of the ten MWh and energy prices. The increases were used to analyze two potential NERC regions modeled, only MAAC, in production costs would range from a facility level impacts associated with MAPP, and SERC would not experience 0.3 percent increase in ERCOT to an the alternative all cooling towers option: economic closures of existing capacity increase of more than 2 percent in (1) Potential changes in the economic as a result of the all cooling towers ECAR. The most substantial changes and operational characteristics of the option. ECAR and WSCC would would occur in the prices paid for Phase II existing facilities and (2) experience the highest closures with capacity reserves. The highest capacity potential changes to individual facilities 2,370 MW and 2,190 MW, respectively. price increase would occur in NPCC within the group of Phase II existing Of the 6,560 MW of capacity projected with 16.6 percent. facilities. EPA analyzed economic to retire as a result of this option, 5,150 closures and changes in production (2) Phase II Existing Facility Level MW, or 79 percent, would be nuclear costs to assess impacts to all Phase II Impacts: capacity. The remainder would be oil/ existing facilities resulting from the gas steam capacity. In addition, every As with the alternative waterbody/ alternative option. Exhibit 14 below NERC region would experience an capacity-based option analysis, the IPM presents the results from this analysis, increase in both production costs per 2000 results from model run year 2013 by NERC region. EXHIBIT 14.—IMPACTS ON PHASE II EXISTING FACILITIES OF THE ALTERNATIVE ALL COOLING TOWERS OPTION (2013) Closure analysis Change in produc- tion Cost NERC region Baseline capacity Percent of base- ($/MWh) # Facilities Capacity (MW) line capacity (percent) ECAR ...... 78,680 1 2,060 2.6 1.4 ERCOT ...... 42,330 1 420 1.0 ¥0.5 FRCC ...... 24,460 0 0 0.0 0.8 MAAC ...... 30,310 0 0 0.0 ¥1.0 MAIN ...... 33,650 0 490 1.5 1.4 MAPP ...... 14,900 0 0 0.0 1.3 NPCC ...... 36,360 0 720 2.0 ¥0.3 SERC ...... 100,780 0 0 0.0 1.0 SPP ...... 19,990 1 20 0.1 0.1 WSCC ...... 30,110 2 2,170 7.2 2.6 Total ...... 411,570 5 5,880 1.4 ¥0.2 Note: Baseline Capacity and Closure Capacity have been rounded to the nearest 10 MW. Exhibit 14 shows that economic additional two facilities that retire in the 2,000 MW while WSCC would impacts under the all cooling tower base case would find it profitable to experience the highest percentage option would be higher than under the remain operating under this option. The retirement, with 7.2 percent of its total proposed rule and the alternative net retirements are therefore five Phase II capacity. waterbody/capacity-based option. facilities and 5,880 MW of capacity. While the group of Phase II existing Overall, seven Phase II existing facilities ECAR would experience the highest facilities as a whole is not expected to would retire under this option. An impact with capacity closures of over experience impacts under the all VerDate 11 cooling towers option, it is possible that To identify these shifts, EPA analyzed 15 presents the total number of Phase II this option would lead to shifts in facility-specific changes in generation, existing facilities with different degrees economic performance among production costs, capacity utilization, of change in each of these measures. individual facilities subject to this rule. revenue, and operating income. Exhibit EXHIBIT 15.—OPERATIONAL CHANGES AT PHASE II EXISTING FACILITIES FROM THE ALL COOLING TOWERS OPTION (2013) Reduction Increase Economic Measures No Change 0¥1% 1¥3% > 3% 0¥1% 1–3% > 3% Change in Generation ...... 18 251 53 3 4 22 151 Change in Production Costs ...... 16 12 4 64 257 17 51 Change in Capacity Utilization ...... 15 25 25 8 12 15 402 Change in Revenue ...... 154 121 55 88 39 35 10 Change in-Operating Income ...... 118 160 50 83 47 29 15 Note: IPM 2000 output for model run year 2013 provides output for 502 Phase II existing facilities. Eighty-one facilities had zero generation in either the base case or post compliance scenario. As such it was not possible to calculate production costs in dollars per MWh of generation for these facilities. For all measures percentages used to assign facilities to impact categories have been rounded to the nearest 10th of a percent. Exhibit 15 indicates that under the all sources of benefits anticipated, how characteristics. If the quantity of water cooling tower option, more facilities these benefits were estimated, what withdrawn is large relative to the flow would experience changes in their level of benefits have been estimated for of the source waterbody, a larger operations and economic performance the proposed rule, and how benefits number of organisms will be affected. than under the other two analyzed compare to costs. Additional detail and Intakes located in nearshore areas tend options. For example, 322 out of 502 EPA’s complete benefits assessment can to have greater ecological impacts than facilities, or 64 percent, would be found in the EBA for the proposed intakes located offshore, since nearshore experience a reduction in generation.81 rule. areas are usually more biologically In addition, 328 facilities would B. The Physical Impacts of Impingement productive and have higher experience a reduction in operating and Entrainment concentrations of aquatic organisms. income while 338 facilities would see their production cost per MWh increase. Impingement and entrainment can In general, the extent and value of However, some facilities subject to have adverse impacts on many kinds of reducing impingement and entrainment today’s rule would also benefit from aquatic organisms, including fish, at existing cooling water intake regulation under this option: 162 shrimp, crabs, birds, sea turtles, and structure locations depends on intake facilities would experience an increase marine mammals. Adult fish and larger and species characteristics that in revenues and 159 would experience organisms are trapped against intake influence the intensity, time, and spatial an increase in operating income. screens, where they often die from the extent of interactions of aquatic immediate impact of impingement, organisms with a facility’s cooling water IX. Benefit Analysis residual injuries, or from exhaustion intake structure and the physical, A. Overview of Benefits Discussion and starvation. Entrained organisms that chemical, and biological characteristics are carried through the facility’s intakes of the source waterbody. A once- This section presents EPA’s estimates die from physical damage, thermal of the national environmental benefits through cooling system withdraws shock, or chemical toxicity induced by water from a source waterbody, of the proposed section 316(b) antifouling agents. regulations for Phase II existing circulates it through the condenser The extent of harm to aquatic system, and then discharges the water facilities. The benefits occur due to the organisms depends on species back to the waterbody without reduction in impingement and characteristics, the environmental recirculation. By contrast, closed-cycle entrainment at cooling water intake setting in which the facilities are structures affected by this rulemaking. located, and facility location, design, cooling systems (which are one part of Impingement and entrainment kills or and capacity. Species that spawn in the basis for best technology available in injures large numbers of aquatic nearshore areas, have planktonic eggs some circumstances) withdraw water organisms. By reducing the levels of and larvae, and are small as adults from the source waterbody, circulate the impingement and entrainment, today’s experience the greatest impacts, since water through the condensers, and then proposed rule would increase the both new recruits and reproducing sends it to a cooling tower or cooling number of fish, shellfish, and other adults are affected (e.g., bay anchovy in pond before recirculating it back aquatic life in local aquatic ecosystems. estuaries and oceans). In general, higher through the condensers. Because This, in turn, will directly and impingement and entrainment are cooling water is recirculated, closed- indirectly improve direct use benefits observed in estuaries and near coastal cycle systems generally reduce the such as those associated with waters because of the presence of water flow from 72 percent to 98 recreational and commercial fisheries. spawning and nursery areas. By contrast percent, thereby using only 2 percent to Other types of benefits, including the young of freshwater species are 28 percent of the water used by once- ecological and nonuse values, would epibenthic and/or hatchel from attached through systems. It is generally assumed also be enhanced. The text below egg masses rather than existing as free- that this would result in a comparable provides an overview of types and floating individuals, and therefore reduction in impingement and freshwater species may be less 81 As explained earlier, facilities with significant entrainment. status changes (including baseline closures, avoided susceptible to entrainment. closures, and facilities that repower) are excluded The likelihood of impingement and from this comparison. entrainment also depends on facility VerDate 11 C. Impingement and Entrainment otherwise of special concern and The following sections describe the Impacts and Regulatory Benefits are status (e.g., depleted commercial methods used by EPA used to evaluate Site-Specific stocks) impingement and entrainment impacts • Site-specific information is critical in Local ambient water quality issues at section 316(b) case study Phase II predicting benefits, because studies at that may also affect the fisheries and existing facilities and to derive an existing facilities demonstrate that their uses economic value associated with any benefits are highly variable across All of these factors, as well as several such losses. facilities and locations. Even similar others, have important impacts on the 1. Estimating Losses of Aquatic facilities on the same waterbody can level and significance of impingement Organisms have very different impacts depending and entrainment. These factors on the aquatic ecosystem in the vicinity determine baseline impacts, and the size The first set of steps in estimating the of the facility and intake-specific and value of regulation-related benefits of the proposed rule involves characteristics such as location, design, reductions in those impacts. estimating the magnitude of construction, and capacity. The regulatory framework proposed impingement and entrainment. EPA’s Some of the important factors that by EPA recognizes the site-specific analysis involved compiling facility- make benefits highly site-specific nature of impingement and entrainment reported empirical impingement and include important differences across the impacts and is designed to entrainment counts and life history regulated facilities themselves. Many of accommodate these factors to the information for affected species. Life these facility-specific characteristics greatest degree practicable in a national history data typically included species- that affect benefits add additional rulemaking. For example, EPA’s specific growth rates, the fractional stressors to the aquatic systems in proposed regulatory approach accounts component of each life stage vulnerable which they operate. Benefits occur for the types of waterbodies that a to harvest, fishing mortality rates, and through the reduction of the stressors cooling water intake structure impacts, natural (nonfishing) mortality rates. through the application of impingement the proportion of the source water flow It is important to note that and entrainment reduction technologies. supplied to the cooling water intake impingement and entrainment Stressor-related factors that make structure, and technological design monitoring data are often limited to a benefits site-specific include: parameters related to the impingement subset of species, and monitoring is • Cooling water intake structure size and entrainment from the intake. The often of very limited duration (e.g., and scale of operation (e.g., flow volume Agency’s benefits analysis attempts to confined to a single year). This implies and velocity) accommodate and reflect these site- that the magnitude of impingement and • Cooling water intake structure specific parameters. entrainment is often underestimated. In addition, in many cases data are over technologies and/or operational D. Data and Methods Used to Estimate two decades old (e.g., from 1979). practices in place (if any) for Benefits impingement and entrainment Therefore the data may not always reduction at baseline (i.e., absent any To estimate the economic benefits of reflect current fishery conditions, new regulations) reducing impingement and entrainment including changes in fisheries due to • Cooling water intake structure at existing cooling water intake water quality improvements since the intake location in relation to local zones structures, all the beneficial outcomes monitoring period. The limited of ecological activity and significance need to be identified and, where temporal extent of the data also omits (e.g., depth and orientation of the intake possible, quantified and assigned the high variability often seen in aquatic point, and its distance from shore) appropriate monetary values. Estimating populations. If data are collected only in • Cooling water intake structure flow economic benefits can be challenging a year of low abundance, impingement volumes in relation to the size of the because of the many steps that need to and entrainment rates will also be low, impacted waterbody be analyzed to link a reduction in and may not reflect the long term Many of the key factors that make impingement and entrainment to average. The data also may not represent impingement and entrainment impacts changes in impacted fisheries and other potential cumulative long-term impacts site-specific reflect the receptors aspects of relevant aquatic ecosystems, of impingement and entrainment. exposed to the stressor-related impacts. and then to link these ecosystem In EPA’s analysis of impingement and Receptors include the types of changes to the resulting changes in entrainment impacts, these facility- waterbodies impacted, the aquatic quantities and values for the associated derived impingement and entrainment species that are affected in those environmental goods and services that counts were modeled with relevant life waterbodies, and the people who use ultimately are linked to human welfare. history data to derive estimates of age 1 and/or value the status of the water The benefit estimates for this rule are equivalent losses (the number of resources and aquatic ecosystems derived from a series of case studies individuals that would have survived to affected. Receptor-oriented factors that from a range of waterbody types at a age 1 if they had not been impinged and make impingement and entrainment number of locations around the country entrained by facility intakes), foregone impacts highly site-specific include: including: fishery yield (the amount in pounds of • The aquatic species present near a • The Delaware Estuary (Mid-Atlantic commercial and recreational fish and facility Estuaries) shellfish that is not harvested due to • The ages and life stages of the aquatic • The Ohio River (Large Freshwater impingement and entrainment losses) species present near the intakes Rivers) and foregone production (losses of • The timing and duration of species’ • Tampa Bay (Gulf Coast Estuaries) impinged and entrained forage species exposure to the intakes • New England Coast (Oceans) that are not commercial or recreational • The ecological value of the impacted • Mount Hope Bay, New England fishery targets but serve as valuable species in the context of the aquatic (North Atlantic Estuaries) components of aquatic food webs, ecosystem • San Francisco Bay/Delta (Pacific particularly as an important food supply • Whether any of the impacted species Coast Estuaries) to other aquatic species including are threatened, endangered, or • The Great Lakes commercial and recreational species). VerDate 11 2. Estimating Baseline Losses and the recreational values are estimated for methodologies in the benefits analysis Economic Benefits of the Proposed Rule some of the case studies (those that are for this proposed rule by applying an Given the projected physical impact examined on a watershed-scale) using a original travel cost study using data on aquatic organisms (losses of age 1 Random Utility Model (RUM). Also, from the National Marine Fishery equivalents resulting from impingement some benefits estimates are developed Service in the Delaware and Tampa and entrainment), the second set of using habitat restoration costing or Estuaries and data from the National steps in the benefits analysis entails similar approaches that use replacement Recreational Demand Survey (NDS) in assigning monetary values to the costs as a proxy for beneficial values. Ohio in a Random Utility Model (RUM) estimated losses. These economic loss Variations of these general of recreational behavior, to estimate the estimates are subsequently converted methodologies have been applied to changes in consumer valuation of water into estimated benefits for the proposed better reflect site-specific circumstances resources that would result from rule by examining the extent to which or data availability. reductions in impingement and In the case of forage species, benefits entrainment-related fish losses. These impingement and entrainment is valuation is challenging because these studies are presented in detail in the reduced by adoption of the best species are not targeted directly by Case Study Document. technology available in accordance with commercial or recreational anglers and The Agency also improved its the options defined in this proposed have no direct use values that can be analyses by performing several Habitat- rule. observed in markets or inferred from Based Replacement Cost analyses. A Economic benefits can be broadly revealed actions of anglers. Therefore, complete Habitat-Based Replacement defined according to several categories two general approaches were used to Cost analysis develops values for of goods and services furnished by the translate estimated impingement and impingement and entrainment losses impacted species, including those that entrainment losses to forage species into based on the combined costs for pertain to the direct use or indirect use monetary values. The first approach implementing habitat restoration of the impacted resources. There also examines replacement costs as a proxy actions, administering the programs, are benefits that are independent of any for the value of estimated forage species and monitoring the increased current or anticipated use (direct or losses (expressed as the total number of production after the restoration actions. indirect) of the resource; these are age 1 equivalents) and was valued based These costs are developed by known as nonuse or passive use values. on hatchery costs. This approach does identifying the preferred habitat The benefits can be further categorized not take into consideration ecological restoration alternative for each species according to whether or not affected problems associated with introducing with impingement and entrainment, and goods and services are traded in the hatchery fish into wild populations. The then scaling the level of habitat market. ‘‘Direct use’’ benefits include second approach used two distinct restoration until the losses across all both ‘‘market’’ commodities (e.g., estimates of trophic transfer efficiency species have been offset fully by commercial fisheries) and ‘‘nonmarket’’ to relate foregone forage production to expected increases in the production of goods (e.g., recreational angling). foregone commercial and recreational those species. The total value of the Indirect use benefits also can be linked fishery yields. A portion of total forage impingement and entrainment losses is to either market or nonmarket goods and production has relatively high trophic then calculated as the sum of the costs services ‘‘ for example, the manner in transfer efficiency because it is across the categories of preferred habitat which reduced impingement and consumed directly by harvested species. restoration alternatives. An in-depth entrainment-related losses of forage The remaining portion of total forage discussion of the Habitat-Based species leads through the aquatic production has low trophic transfer Replacement Cost methodology is in ecosystem food web to enhance the efficiency because it reaches harvested Chapter A11 of the Case Study biomass of species targeted for species indirectly following multiple Document. Examples of estimating commercial (market) and recreational interactions at different parts of the food benefits using the Habitat-Based (nonmarket) uses. ‘‘Nonuse’’ benefits web. Ultimately, the production Replacement Cost methodology can be include only ‘‘nonmarketed’’ goods and foregone approach assigns a value to found in the case studies for the Pilgrim services, reflecting human values reduced forage species losses based on Nuclear facility (Part G) and the Brayton associated with existence and bequest their indirect contribution to higher Point facility (Part F). A stream-lined motives. commercial and recreational fishery version of the methodology can be The economic value of benefits is values. found in the J.R. Whiting case study estimated using a range of traditional Benefits analyses for rulemakings (Part H) and the Monroe case study (Part methods, with the specific approach under the Clean Water Act have been I) of the Case Study Document. being dependent on the type of benefit limited in the range of benefits The primary strength of the Habitat- category, data availability, and other addressed, which has hindered EPA’s Based Replacement Cost method is the suitable factors. Accordingly, some ability to compare the benefits and costs explicit recognition that impingement benefits are valued using market data of rules comprehensively. The Agency and entrainment losses have impacts on (e.g., for commercial fisheries), and is working to improve its benefits all components of the aquatic others are valued using secondary analyses, including applying ecosystem, and the public’s use and nonmarket valuation data (e.g., benefits methodologies that have now become enjoyment of that ecosystem, beyond transfer of nonmarket valuation studies well established in the natural resources that estimated by reduced commercial of the value of recreational angling). valuation field, but have not been used and recreational fish catches. Results Some benefits are described only previously in the rulemaking process. depend on the quality of the qualitatively, because it was not feasible EPA was particularly interested in impingement and entrainment data to derive reliable quantitative estimates expanding its benefits analysis for this collected, the availability of data on the of the degree of impact and/or the rule to include more primary research habitat requirements of impinged or monetary worth of reducing those along with the use of secondary (e.g., entrained species, and the program for impacts. In addition, some nonmarket benefits transfer) methods to estimate defining expected production increases benefits are estimated using primary recreation benefits. EPA has therefore for species following implementation of research methods. Specifically, expanded upon its traditional restoration activities. VerDate 11 3. EPA’s Estimates of Impingement and impingement and entrainment with the RUM is estimated) are not Entrainment Losses and Benefits cooling towers. considered. Thus, benefits will be Probably are Underestimates • Potential latent mortality rates are understated if participation increases in unknown for most technologies. EPA’s estimates of fish losses due to response to increased availability of • Installed technologies may not fishery species as a result of reduced impingement and entrainment, and of operate at the maximum efficiency the benefits of the proposed regulations, impingement and entrainment. This assumed by EPA in its estimates of approach omits the portion of are subject to considerable technology effectiveness. uncertainties. As a result, the Agency’s recreational fishing benefits that arise benefits estimates could be either over- Potential Cumulative Impacts when improved conditions lead to higher levels of participation. Empirical or under-estimated. However, because • Impingement and entrainment of the many factors omitted from the evidence suggests that the omission of impacts often have cumulative impacts increased angling days can lead to an analysis (typically because of data that are usually not considered. limitations) and the manner in which underestimate of total recreational Cumulative impacts refer to the fishing benefits. Where EPA has been several key uncertainties were temporal and spatial accumulation of addressed, EPA believes that its analysis able to apply its RUM analyses, the changes in ecosystems that can be recreational angling benefits are more is likely to lead to a potentially additive or interactive. Cumulative significant underestimate of baseline indicative of the full range of beneficial impacts can result from the effects of angling outcomes. losses and, therefore lead to understated multiple facilities located within the estimates of regulatory benefits. same waterbody and from individually Secondary (Indirect) Economic Impacts Several of the key factors that are minor but collectively significant Secondary impacts, are not calculated likely to lead EPA’s analysis to impingement and entrainment impacts (effects on marinas, bait sales, property underestimate benefits include: taking place over a period or time. values, and so forth are not included, • Data Limitations Relatively low estimates of even though they may be significant and impingement and entrainment impacts • applicable on a regional scale). EPA’s analysis is based on facility- may reflect a situation where provided biological monitoring data. cumulative impingement and Commercial Benefits These facility-furnished data typically entrainment impacts (and other stresses) • The proportion of impingement and focus on a subset of the fish species have appreciably reduced fishery entrainment losses of fishery species impacted by impingement and populations so that there are fewer that were valued as lost commercial entrainment, resulting in an organisms present in intake flows. catch was determined from stock- underestimate of the total magnitude of • In many locations (especially specific fishing mortality rates, which losses. estuary and coastal waters), many fish indicate the fraction of a stock that is • Industry biological studies often species migrate long distances. As such, harvested. Because fishing mortality lack a consistent methodology for these species are often subject to rates are typically less than 20%, a large monitoring impingement and impingement and entrainment risks proportion of the losses of fishery entrainment. Thus, there are often from a large number cooling water species were not valued in the benefits substantial uncertainties and potential intake structures. EPA’s analyses reflect transfer analyses. biases in the impingement and the impacts of a limited set of facilities • In most cases, invertebrate species entrainment estimates. Comparison of on any given fishery, whereas many of (e.g, lobsters, mussels, crabs, shrimp) results between studies is therefore very these fish are subjected to impingement were not included because of a lack of difficult and sometimes impossible, and entrainment at a greater number of impingement and entrainment data and/ even among facilities that impinge and cooling water intake structures than are or life history information. entrain the same species. included in the boundaries of the • Impingement and entrainment • The facility-derived biological Agency’s case studies. impacts and associated reductions in monitoring data often pertain to fishery yields are probably understated conditions existing many years ago (e.g., Recreational Benefits even for those species EPA could the available biological monitoring often • The proportion of impingement and evaluate because of a lack of monitoring was conducted by the facilities 20 or entrainment losses of fishery species data to capture population variability more years ago, before activities under that were valued as lost recreational and cumulative impingement and the Clean Water Act had improved catch was determined from stock- entrainment impacts over time. aquatic conditions). In those locations specific fishing mortality rates, which • Current fishing mortality rates (and where water quality was relatively indicate the fraction of a stock that is resulting estimates of yield) often reflect degraded at the time of monitoring harvested. Because fishing mortality depleted fisheries, not what the fisheries relative to current conditions, the rates are typically less than 20%, a large should or could be if not adversely numbers and diversity of fish are likely proportion of the losses of fishery impacted by impingement and to have been depressed during the species were not valued in the benefits entrainment and other stressors. As monitoring period, resulting in low transfer and RUM analyses. such, yield estimates may be artificially impingement and entrainment. In most • Only selected species were low because of significantly curtailed of the nation’s waters, current water evaluated because impingement and recreational and/or commercial catch of quality and fishery levels have entrainment or valuation data were key species impinged and entrained improved, so that current impingement limited. (e.g., winter flounder in Mount Hope and entrainment losses are likely to be • In applying benefits transfer to Bay). greater than available estimates for value the benefits of improved depressed populations. recreational angling, the Agency only Forage Species assigned a monetary benefit to the • Forage species often make up the Estimated Technology Effectiveness increases in consumer surplus for the predominant share of losses due to • The only technology effectiveness baseline number of fishing days. impingement and entrainment. that is certain is reductions in Changes in participation (except where However, impingement and entrainment VerDate 11 losses of forage species are usually not E. Summary of Benefits Findings: Case structures. On the other hand, high known because many facility studies Studies population abundance in the source focus on commercial and recreational As noted above, EPA developed waterbody and associated high fishery species only. benefits estimates for various case impingement and entrainment may • Even when forage species are studies, and key results are described reflect waterbody improvements that are included in loss estimates, the monetary below. independent of impacts from or value assigned to forage species is likely improvements in cooling water intake to be understated because the full 1. The Delaware Estuary (Mid-Atlantic structure technologies. High levels of ecological value of the species as part of Estuaries) impingement and entrainment impacts the food web is not considered. The results of EPA’s evaluation of on a species may also indicate a high • Forage losses are often valued at impingement and entrainment rates at susceptibility of that given species to only a fraction of their potential full cooling water intake structures in the cooling water intake structure effects. value because of partial ‘‘replacement’’ Delaware Estuary transition zone In addition to estimating the physical cost (even if feasible to replace). indicate that cumulative impacts can be impact of impingement and entrainment • Low production foregone substantial. EPA’s analysis shows that in terms of numbers of fish lost because assumptions (no inherent value, only even when losses at individual facilities of the operation of all in scope and out- added biomass to landed recreational appear insignificant, the total of all of-scope cooling water intake structures and commercial species is considered). impingement and entrainment impacts in the Delaware Estuary transition zone, • In one valuation approach EPA on the same fish populations can be EPA also examined the estimated applied to forage species, only the small sizable. For example, nearly 44,000 age economic value of the losses from share of these losses are valued— 1 equivalents of weakfish are lost as a impingement and entrainment. The namely the contribution of the forage result of entrainment at Hope Creek, estimated cumulative impact of species to the increased biomass of which operates with closed-cycle impingement and entrainment at the 12 landed recreational and commercial cooling and therefore has relatively low cooling water intake structures located species. entrainment rates. However, the number in the Delaware case study area was of total weakfish age 1 equivalents lost • This does not apply to benefits based on data available for the Salem as a result of entrainment at all derived by the Habitat-Based facility and then extrapolated to the transition zone cooling water intake other facilities on the basis of flow. Replacement Cost approach, which structures is over 2.2 million provides a more comprehensive Average losses at all transition zone individuals. Cumulative impacts of all cooling water intake structures from indication of the benefits of reducing species at Delaware Estuary transition impingement and entrainment on all impingement are valued (using benefits zones facilities is 14.3 million age 1 transfer) at between roughly $0.5 species, including forage fish. EPA has equivalent fish impinged per year and applied this approach to a limited million and $1.1 million per year, and entrainment is 616 million age 1 between approximately $23.9 million number of settings, and in those settings equivalent fish entrained per year. and $49.5 million per year for the findings suggest benefits appreciably EPA has conservatively estimated entrainment (all in 2001$). Average greater than derived from the more cumulative impacts on Delaware traditional, partial benefits approaches Estuary species by considering the losses at the four in scope facilities applied by the Agency. impingement and entrainment impacts (using benefits transfer combined with RUM recreation estimates) range from Nonuse Benefits of only transition zone cooling water intake structures. In fact, many of the $0.5 million to $0.8 million per year for • Nonuse benefits are most likely species affected by cooling water intake impingement and from $26.0 to $46.2 understated using the 50 percent rule structures within the transition zone million per year for entrainment (all in because the recreational values used are move in and out of this area, and 2001$) (see Exhibit 13). likely to be understated. therefore may be exposed to many more In this estuarine setting, benefits • The 50 percent rule itself is cooling water intake structures than attributed to reducing losses due to both conservative (e.g., only reflects nonuse considered here. Regardless of the impingement and entrainment may be component of total value to recreational geographic extent of an evaluation of quite large in terms of numbers of fish users. It does not reflect any nonuse cumulative impacts, it is important to and in terms of the portion of benefits benefits to recreational nonusers). consider how impingement and that could be monetized. Entrainment • Impacts on threatened and entrainment rates relate to the relative losses are over 40 times greater than endangered species are not fully abundance of species in the source impingement losses. This reflects the captured. waterbody. Thus, low impingement and typical richness of estuary waters as entrainment does not necessarily imply important nursery locations for early life Incidental Benefits low impact, since it may reflect low stages of many important aquatic • EPA has not accounted for thermal population abundance, which can result species, coupled with the significant impact reductions, which will be from numerous natural and adverse impact that entrainment can incidental benefits in places where anthropogenic factors, including long- have on such life stages. This result once-through facilities are replaced with term impingement and entrainment indicates the relative importance of recirculating water regimes. impacts of multiple cooling water intake entrainment controls in estuary areas. EXHIBIT 13.—BASELINE IMPACTS (ANNUAL AVERAGE) AT FOUR IN SCOPE FACILITIES IN THE TRANSITION ZONE OF THE DELAWARE ESTUARY Impingement Entrainment Four In Scope Facilities a. age 1 equivalent fish lost ...... >14.3 mil/yr ...... >616 mil/yr. VerDate 11 EXHIBIT 13.—BASELINE IMPACTS (ANNUAL AVERAGE) AT FOUR IN SCOPE FACILITIES IN THE TRANSITION ZONE OF THE DELAWARE ESTUARY—Continued Impingement Entrainment b. # lbs lost to landed fishery ...... >438,000 lbs/yr ...... >16 mil lbs/yr. c. $ value of loss (2001$) ...... $0.5 mil–$0.8 mil ...... $26.0 mil—$46.2 mil. In part, EPA’s recreational benefits Estuary transition zone. The estimated indicate that improvements in fishing estimates for the Delaware Estuary is economic values of recreational losses site quality from reducing impingement based on a RUM analysis of recreational from impingement and entrainment at and entrainment at all in scope facilities fishing benefits from reduced the 12 cooling water intake structures will increase the total number of fishing impingement and entrainment. The located in the case study area are $0.75, days in Delaware and New Jersey by RUM application in the Delaware $2.04, and $9.97 per trip for anglers not 9,464. Estuary focuses on weakfish and striped targeting any particular species and EPA combined fishing participation bass fishing valuation. Several anglers targeting weakfish and striped estimates with the estimated per trip recreational fishing studies have valued bass, respectively (all in 2001$). EPA welfare gain under various policy weakfish and striped bass, but values then estimated benefits of reducing scenarios to estimate the value to specific to these studies are not impingement and entrainment of two recreational anglers of changes in catch available. The study area includes species —weakfish and striped bass—at rates resulting from changes in recreational fishing sites at the Delaware the four in scope cooling water intake impingement and entrainment in the River Estuary and the Atlantic coasts of structures in the case study area. The Delaware Estuary transition zone. EPA Delaware and New Jersey. estimated values of an increase in the calculated low and high estimates of EPA uses data for this case study from quality of fishing sites from reducing economic values of recreational losses the Marine Recreational Fishery impingement and entrainment at the in from impingement and entrainment by Statistics Survey (MRFSS), combined scope cooling water intake structures multiplying the estimated per trip with the 1994 Add-on MRFSS Economic are $0.52, $1.40 and $6.90 per trip for welfare gain by the baseline and policy Survey (AMES). The study uses MFRSS no target anglers and anglers targeting scenario number of trips, respectively. information on angler characteristics weakfish and striped bass, respectively The estimated recreational losses and angler preferences, such as where (all in 2001$). (2001$) to Delaware and New Jersey they go fishing and what species they EPA also examined the effects of anglers from impingement and catch, to infer their values for changes changes in fishing circumstances on entrainment of 2 species at all Phase II in recreational fishing quality. EPA fishing participation during the existing facilities in the transitional estimated angler behavior using a RUM recreational season. First, the Agency estuary, and all facilities in the for single-day trips. The study used used the negative binomial form of the transitional estuary range from $0.2 to standard assumptions and specifications Poisson model to model an angler’s $0.3 and from $7.2 to $13.2 million, of the RUM model that are readily decision concerning the number of respectively. Using similar calculations, available from the recreation demand fishing trips per recreation season. The the Agency estimated that reducing literature. Among these assumptions are number of fishing trips is modeled as impingement and entrainment of that anglers choose fishing mode and function of the individual’s weakfish and striped bass at the four in then the site in which to fish; and that socioeconomic characteristics and scope cooling water intake structures in anglers’ choice of target species is estimates of individual utility derived the transition zone will generate $5.2 to exogenous to the model. EPA modeled from the site choice model. The Agency $9.3 million (2001$) annually, in an angler’s decision to visit a site as a then used the estimated model recreational fishing benefits alone, to function of site-specific cost, fishing trip coefficients to estimate percentage Delaware and New Jersey anglers. quality, presence of boat launching changes in the total number of In interpreting the results of the case facilities, and water quality. recreational fishing trips due to study analysis, it is important to The quality of a recreational fishing improvements in recreational site consider several critical caveats and trip is expressed in terms of the number quality. EPA combined fishing limitations of the analysis. For example, of fish caught per hour of fishing. Catch participation data for Delaware and New in the economic valuation component of rate is the most important attribute of a Jersey obtained from MFRSS with the the analysis, valuation of impingement fishing site from the angler’s estimated percentage change in the and entrainment losses is often perspective. This attribute is also a number of trips under various policy complicated by the lack of market value policy variable of concern because catch scenarios to estimate changes in total for forage species, which may comprise rate is a function of fish abundance, participation stemming from changes in a large proportion of total losses. EPA which may be affected by fish mortality the fishing site quality in the study area. estimates that more than 500 million age caused by impingement and The MRFSS fishing participation data 1 equivalents of bay anchovy may be entrainment. include information on both single-day lost to entrainment at transition zone The Agency combined the estimated and multiple-day trips. The Agency cooling water intake structure each year model coefficients with the estimated assumed that per day welfare gain from (over 85 percent of the total of over 616 changes in impingement and improved fishing site quality is million estimated lost age 1 individuals entrainment associated with various independent of trip length. EPA for all species combined). Bay anchovy cooling water intake structure therefore calculated total fishing has no direct market value, but it is technologies to estimate per trip welfare participation for this analysis as the sum nonetheless a critical component of losses from impingement and of the number of single day trips and the estuarine food webs. EPA included entrainment at the cooling water intake number of fishing days corresponding to forage species impacts in the economic structures located in the Delaware multiple day trips. Analysis results benefits calculations, but the final VerDate 11 estimates may well underestimate the approximately 11.6 million fish (age 1 species impacts (measured as partial as full value of the losses imposed by equivalents) per year. This translates replacement costs or production impingement and entrainment. Thus, on into over 1.11 million pounds of fishery foregone). This provides an indication the whole, EPA believes the estimates production foregone per year, and over of the estimated cumulative impact of developed here probably underestimate 15,000 pounds of lost fishery yield impingement and entrainment at the all the economic benefits of reducing annually. in scope and out-of-scope cooling water impingement and entrainment in the For in scope facilities only, the results intake structures in the case study area, Delaware transition zone. indicate that impingement causes the based on data available for the 9 case mortality of approximately 11.3 million study facilities with usable 2. Ohio River (Large Rivers) fish (age 1 equivalents) per year (97.8 impingement and entrainment data, and EPA evaluated the impacts of percent of all impingement). This then extrapolated to the other facilities impingement and entrainment using translates into nearly 1.09 million on the basis of flow and river pool. facility-generated data at 9 cooling water pounds of fishery production foregone Average historical losses from all in intake structures along a 500 mile per year, and nearly 15,000 pounds of scope facilities in the case study area for stretch of the Ohio River, spanning from lost fishery yield annually (98.1 percent impingement are valued using benefits the western portion of Pennsylvania, and 97.1 percent of the total, transfer at between roughly $0.1 million along the southern border of Ohio, and respectively). and $1.4 million per year (in 2001$). into eastern Indiana. The results were For entrainment, the results indicate Average historical losses from then extrapolated to the 20 other in that all facilities combined (in scope entrainment are valued using benefits scope facilities along this stretch of the and out-of-scope) cause the mortality of transfer at between approximately $0.8 river (a total of 29 facilities are expected approximately 24.4 million fish (age 1 million and $2.4 million per year (all in to be in scope for this rulemaking, and equivalents) per year. This translates 2001$) for in scope facilities. another 19 facilities are out-of-scope). into over 10.08 million pounds of EPA also estimated a random utility To estimate impingement and fishery production foregone per year, model (RUM) to provide primary entrainment impacts for the Ohio, EPA and over 39,900 pounds of lost fishery estimates of the recreational fishery evaluated the available impingement yield annually. losses associated with impingement and and entrainment monitoring data at 9 For in scope facilities only, the results entrainment in the Ohio River case case study facilities (W.C. Beckjord, indicate that entrainment causes the study area. This primary research Cardinal, Clifty Creek, Kammer, Kyger mortality of approximately 23.0 million results supplement the benefits transfer Creek, Miami Fort, Philip Sporn, fish (age 1 equivalents) per year (94.2 estimates derived by EPA. The average Tanners Creek, and WH Sammis). The percent of all entrainment). This annual recreation-related fishery losses results from these 9 facilities with translates into nearly 9.89 million at all facilities in the case study amount impingement and entrainment data pounds of fishery production foregone to approximately $8.4 million (in 2001$) were then extrapolated to the remaining per year, and over 39,000 pounds of lost per year (impingement and entrainment in scope facilities to derive an fishery yield annually (98.1 percent and impacts combined). For the in scope impingement and entrainment baseline 97.7 percent of the total, respectively). facilities covered by the proposed Phase for all facilities subject to the proposed In addition to estimating the physical II rule, the losses due to impingement rule (additional extrapolations were also impact of impingement and entrainment and entrainment were estimated via the made to out-of-scope facilities so that in terms of numbers of fish lost because RUM to amount to approximately $8.3 total impingement and entrainment of the operation of all in scope and out- million per year (in 2001$). Results for could be estimated as well). The of-scope cooling water intake structures the RUM analysis were merged with the extrapolations were made on the basis in the Ohio River case study area, EPA benefits transfer-based estimates in a of relative operating size (operating also estimated the baseline economic manner that avoids double counting, MGD) and by river pool (Hannibal, value of the losses from impingement and indicate that baseline losses at in Markland, McAlpine, New Cumberland, and entrainment. The economic value of scope facilities amount to between $3.5 Pike Island, and Robert C. Byrd pools). these losses is based on benefits million and $4.7 million per year for The results indicate that impingement transfer-based values applied to losses impingement and between $9.3 and $9.9 at all facilities (in scope and out-of- to the recreational fishery, nonuse million per year for entrainment (in scope) causes the mortality of values, and the partial value of forage 2001$) (see Exhibit 14). EXHIBIT 14.—BASELINE IMPACTS (ANNUAL AVERAGE) IN THE OHIO RIVER AT IN SCOPE FACILITIES Impingement Entrainment 29 In Scope Facilities a. age 1 equivalent fish lost ...... > 11.3 mil/yr ...... > 23.0 mil/yr b. # lbs lost to landed fishery ...... > 1.1 mil lbs/yr ...... > 9.9 mil lbs/yr c. $ value of loss (2001$) ...... $3.5 mil—$4.7 mil/yr ...... $9.3 mil—$9.9 mil/yr In interpreting the results of the case by the lack of market value for forage benefits calculations, but because study analysis, it is important to species, which may comprise a large techniques for valuing such losses are consider several critical caveats and proportion of total losses. Forage species limited, the final estimates may well limitations of the analysis. In the have no direct market value, but are underestimate the full ecological and economic valuation component of the nonetheless a critical component of economic value of these losses. analysis, valuation of impingement and aquatic food webs. EPA included forage In addition, the Ohio River case study entrainment losses is often complicated species impacts in the economic is intended to reflect the level of impingement and entrainment, and VerDate 11 hence the benefits associated with 2002), the case study will yield smaller benefits were estimated by reference to reducing impingement and entrainment than typical impingement and other programs already in place to impacts, for cooling water impact entrainment impact estimates. protect and restore the declining striped structures along major rivers of the U.S. • The Ohio River is very heavily bass population and threatened and However, there are several factors that impacted by cumulative effects of endangered fish species of the San suggest that the Ohio River case study impingement and entrainment over time Francisco Bay/Delta region. The special findings may be a low-end scenario in and across a large number of cooling status species that were evaluated terms of estimating the benefits of the water intake structures. The case study included delta smelt, threatened and proposed regulation at facilities along segment of the river has 29 facilities that endangered runs of chinook salmon and major inland rivers of the U.S. These are in scope for the Phase II rulemaking, steelhead, sacramento splittail, and factors include the following: plus an additional 19 facilities that are longfin smelt. • The impingement and entrainment out of scope. Steam electric power Based on limited facility data, EPA data developed by the facilities were generation accounted for 5,873 MGD of estimates that the striped bass limited to one year only, and are from water withdrawal from the river basin, recreational catch is reduced by about 1977 (nearly 25 years ago) and pertain more than 90 percent of the total surface 165,429 fish per year due to to a period of time when water quality water withdrawals, according to 1995 impingement at the two facilities and in the case study area was worse than data from USGS. 185,073 fish per year due to it is currently. This suggests that the In conclusion, several issues and entrainment. Estimated impingement numbers of impinged and entrained fish limitations in the impingement and losses of striped bass are valued at today (the regulatory baseline) would be entrainment data for the Ohio case between $379,000 and $589,000 per appreciably higher than observed in the study (e.g., the reliance on data for one year, and estimated entrainment losses data collection period. In addition, the year, nearly 25 years ago), and the many are valued at between $2.58 million to reliance on a monitoring period of one stressors that affect the river (especially $4.01 million per year (all in 2001$). year or less implies that the naturally in the 1977 time frame), suggest that the high variability in fishery populations is results obtained by EPA underestimate EPA estimates that the total loss of not captured in the analysis, and the the benefits of the rule relative to special status fish species at the two results may reflect a year of above or current Ohio River conditions. The facilities is 145,003 age 1 equivalents below average impingement and results are also likely to underestimate per year resulting from impingement entrainment. the benefits value of impingement and and 269,334 age 1 equivalents per year • The Ohio River is heavily impacted entrainment reductions at other inland due to entrainment. Estimated by numerous significant anthropogenic river facilities. impingement losses of these species are stressors in addition to impingement valued at between $12.38 million and and entrainment. The river’s hydrology 3. San Francisco Bay/Delta (Pacific $42.65 million per year, and estimated has been extensively modified by a Coast Estuaries) entrainment losses are valued at series of 20 dams and pools, and the The results of EPA’s evaluation of between $23.1 million and $79.2 river also has been extensively impacted impingement and entrainment of striped million per year (all in 2001$). by municipal and industrial wastewater bass, and threatened and endangered The estimated value of the discharges along this heavily populated and other special status fish species at recreational losses and the special status and industrialized corridor. To the the Pittsburg and Contra Costa facilities species losses combined range from degree to which these multiple stressors in the San Francisco Bay/Delta $12.8 million to $43.2 million per year were atypically extensive along the demonstrate the significant economic for impingement and from $25.6 million Ohio River (in 1977) relative to those benefits that can be achieved if losses of to $83.2 million per year for along other cooling water intake highly valued species are reduced by entrainment (all in 2001$) (see Exhibit structure-impacted rivers in the U.S. (in the proposed section 316(b) rule. The 15). EXHIBIT 15.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR SPECIAL STATUS FISH SPECIES AT 2 FACILITIES IN THE SAN FRANCISCO BAY/DELTA Impingement Entrainment Two In Scope Facilities a. age 1 equivalent fish lost ...... > 145,000/yr ...... > 269,000/yr b. number of striped bass lost to recreational catch ..... 165,429 ...... 185,073 c. $ value of combined loss (2001$) ...... $12.8 mil—$43.2 mil/yr ...... $25.6 mil—$83.2 mil/yr In interpreting these results, it is It is also important to note that under number of eggs and larvae lost to important to consider several critical the Endangered Species Act, losses of impingement and entrainment, and caveats and limitations of the analysis. all life stages of endangered fish are of because the life history data required to No commercial fisheries losses or non- concern, not simply losses of adults. calculate age 1 equivalent are uncertain special status forage species losses are However, because methods are for these rare species, this method of included in the analysis. Recreational unavailable for valuing losses of fish quantifying impingement and losses are analyzed only for striped bass. eggs and larvae, EPA valued the losses entrainment losses may result in an There are also uncertainties about the of threatened and endangered species underestimate of the true benefits to effectiveness of restoration programs in based on the estimated number of age 1 society of the proposed section 316(b) terms of meeting special status fishery equivalents that are lost. Because the regulation. outcome targets. number of age 1 equivalents can be substantially less than the original VerDate 11 4. The Great Lakes particularly for forage species for which valuation approaches (e.g., commercial valuation techniques are limited. The and recreational fishing impacts EPA examined the estimated HRC technique is designed to provide a valuations). An advantage of the HRC economic value of impingement and more comprehensive, ecological-based method is that the HRC values can entrainment at J.R. Whiting before valuation of impingement and easily address losses for species lacking installation of a deterrent net to reduce entrainment losses than valuation by a recreational or commercial fishery impingement to estimate the historical traditional commercial and recreational losses of the facility and potential value (e.g., forage species that typically impacts methods. Losses are valued on are a large proportion of impingement impingement and entrainment damages the basis of the combined costs for at other Great Lakes facilities that do not and entrainment impacts, but that are implementing habitat restoration not readily valued in a traditional employ technologies to reduce actions, administering the programs, impingement or entrainment. Average benefits analysis). Further, the HRC and monitoring the increased explicitly recognizes and captures the impingement without the net is valued production after the restoration actions. at between $0.4 million and $1.2 fundamental ecological relationships In a complete HRC, these costs are between impinged and entrained million per year, and average developed by identifying the preferred entrainment is valued at between organisms and their surrounding habitat restoration alternative for each environment by valuing losses through $42,000 and $1.7 million per year (all in species with impingement and 2001$) (see Exhibit 16). the cost of the actions required to entrainment losses and then scaling the provide an offsetting increase in the The midpoints of the pre-net results level of habitat restoration until the existing populations of those species in from the benefits transfer approach were losses across all the species in that their natural environment. used as the lower ends of the valuations category have been offset by expected losses. The upper ends of the valuation increases in production of each species. Impingement losses at J.R. Whiting of losses reflect results of the Habitat- The total value of impingement and with an aquatic barrier net are estimated based Replacement Cost (HRC) method entrainment losses at the facility is then to be reduced by 92 percent, while for valuing impingement and calculated as the sum of the costs across entrainment losses are not significantly entrainment losses. HRC-based the categories of preferred habitat affected. Thus, losses with a net are estimates of the economic value of restoration alternatives. valued at between $29,000 and $99,000 impingement and entrainment losses at The HRC method is thus a supply- for impingement and between $42,000 J.R. Whiting were included with the side approach for valuing impingement and $1.7 million per year for transfer-based estimates to provide a and entrainment losses in contrast to the entrainment (all in 2001$) (see Exhibit better estimate of loss values, more typically used demand-side 17). EXHIBIT 16.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR J.R. WHITING WITHOUT NET Impingement Entrainment One Great Lakes Facility a. age 1 equivalent fish lost ...... >1.8 mil/yr ...... >290,000/yr. b. # lbs lost to landed fishery ...... >21.4 mil lbs/yr ...... > 404,000 lbs/yr. c. $ value of loss (2001$) ...... $0.4 mil–$1.2 mil/yr ...... $42,000–$1.7 mil/yr. EXHIBIT 17.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR J.R. WHITING WITHOUT NET Impingement Entrainment One Great Lakes Facility a. age 1 equivalent fish lost ...... >0.1 mil/yr ...... >290,000/yr. b. # lbs lost to landed fishery ...... >1.7 mil lbs/yr ...... >404,000 lbs/yr. c. $ value of loss (2001$) ...... $29,000–$99,000/yr ...... $42,000–$1.7 mil/yr. 5. Tampa Bay facilities indicated a cumulative using benefits transfer for all in scope To evaluate potential impingement impingement impact of 1 million age 1 facilities in Tampa Bay (Big Bend, PL and entrainment impacts of cooling fish (27,000 pounds of lost fishery yield) Bartow, FJ Gannon, and Hookers Point) water intake structures in estuaries of and a cumulative entrainment impact of range from $150,000 to $165,000 for the Gulf Coast and Southeast Atlantic, 19 billion age 1 equivalent fish (56 impingement and from $17.5 million to EPA evaluated impingement and million pounds of lost fishery yield) $18.5 million per year for entrainment entrainment rates at the Big Bend each year. (all in 2001$). facility in Tampa Bay. EPA estimated The results of EPA’s evaluation of the EPA also developed a random utility that the impingement impact of Big dollar value of impingement and model (RUM) approach to estimate the Bend is 420,000 age 1 equivalent fish entrainment losses at Big Bend, as effects of improved fishing and over 11,000 pounds of lost fishery calculated using benefits transfer, opportunities due to reduced yield per year. The entrainment impact indicate that baseline economic losses impingement and entrainment in the is 7.71 billion age 1 equivalent fish and range from $61,000 to $67,000 per year Tampa Bay Region. Cooling water intake over nearly 23 million pounds of lost for impingement and from $7.1 million structures withdrawing water from fishery yield per year. Extrapolation of to $7.4 million per year for entrainment Tampa Bay impinge and entrain many these losses to other Tampa Bay (all in 2001$). Baseline economic losses of the species sought by recreational VerDate 11 anglers. These species include spotted To estimate changes in the quality of percent for anglers who target black seatrout, black drum, sheepshead, fishing sites under different policy drum. pinfish, and silver perch. The study area scenarios, EPA relied on the recreational If impingement and entrainment is includes Tampa Bay itself and coastal fishery landings data by State and the eliminated in the Tampa region, total sites to the north and south of Tampa estimates of recreational losses from benefits are estimated to be $2,428,000 Bay. impingement and entrainment on the per year at the baseline number of trips, The study’s main assumption is that relevant species at the Tampa Bay and $2,458,000 per year at the predicted anglers will get greater satisfaction, and cooling water intake structures. The increased number of trips (all in 2001$). thus greater economic value, from sites Agency estimated changes in the quality At the baseline number of trips, the where the catch rate is higher, all else of recreational fishing sites under being equal. This benefit may occur in impingement and entrainment benefits different policy scenarios in terms of the to black drum anglers are $270,000 per two ways: first, an angler may get percentage change in the historic catch greater enjoyment from a given fishing year; benefits to spotted seatrout anglers rate. EPA divided losses to the are $2,016,000 per year; and benefits to trip when catch rates are higher, and recreational fishery from impingement thus get a greater value per trip; second, sheepshead anglers are $143,000 per and entrainment by the total year (all in 2001$). anglers may take more fishing trips recreational landings for the Tampa Bay when catch rates are higher, resulting in area to calculate the percent change in Results for the RUM analysis were greater overall value for fishing in the historic catch rate from baseline losses merged with the benefits transfer-based region. (i.e., eliminating impingement and estimates to create an estimate of EPA’s analysis of improvements in entrainment completely). recreational fishery losses from recreational fishing opportunities in the The results show that anglers impingement and entrainment in a Tampa Bay Region relies on a subset of targeting black drum have the largest manner that avoids double counting of the 1997 Marine Recreational Fishery per trip welfare gain ($7.18 in 2001$) the recreation impacts. Baseline Statistics Survey (MRFSS) combined from eliminating impingement and economic losses combining both with the 1997 Add-on MRFSS Economic entrainment in the Tampa region. approaches for all in scope facilities in Survey (AMES) and the follow-up Anglers targeting spotted seatrout and Tampa Bay (Big Bend, PL Bartow, FJ telephone survey for the Southeastern Gannon, and Hookers Point) range from United States. The Agency evaluated sheepshead have smaller per-trip gains ($1.80 and $1.77 respectively, in 2001$). $0.80 million to $0.82 million for five species and species groups in the impingement and from $20.0 million to model: drums (including red and black The large gains for black drum are due to the large predicted increase in catch $20.9 million per year for entrainment drum), spotted seatrout, gamefish, (all in 2001$) (see Exhibit 18). snapper-grouper, and all other species. rates. In general, based on a Impingement and entrainment was hypothetical one fish per trip increase For a variety of reasons, EPA believes found to affect black drum, spotted in catch rate, gamefish and snapper- that the estimates developed here seatrout, and sheepshead which is grouper are the most highly valued fish underestimate the value of impingement included in the snapper-grouper species in the study area, followed by drums and entrainment losses at Tampa Bay category. and spotted seatrout. facilities. EPA assumed that the effects EPA estimated both a random utility EPA calculated total economic values of impingement and entrainment on fish site choice model and a negative by combining the estimated per trip populations are constant over time (i.e., binomial trip participation model. The welfare gain with the total number of that fish kills do not have cumulatively random utility model assumes that trips to sites in the Tampa Bay region. greater impacts on diminished fish anglers choose the site that provides EPA used the estimated trip populations). EPA also did not analyze them with the greatest satisfaction, participation model to estimate the whether the number of fish affected by based on the characteristics of different percentage change in the number of impingement and entrainment would sites and the travel costs associated with fishing trips with the elimination of increase as populations increase in visiting different sites. The trip impingement and entrainment. These response to improved water quality or participation model assumes that the estimated percentage increases are 0.93 other improvements in environmental total number of trips taken in a year are percent for anglers who target conditions. In the economic analyses, a function of the value of each site to the sheepshead, 0.94 percent for anglers EPA also assumed that fishing is the angler and characteristics of the angler. who target spotted seatrout, and 3.82 only recreational activity affected. EXHIBIT 18.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR TAMPA BAY Impingement Entrainment Four In Scope Facilities a. age 1 equivalent fish lost ...... >1 mil/yr ...... >19 billion/yr. b. # lbs lost to landed fishery ...... >27,000 lbs/yr ...... >56 million lbs/yr. c. $ value of loss (2001$) ...... $0.80 mil–$0.82 mil/yr ...... $20.0 mil–$20.9 mil/yr. 6. Brayton Point 69,300 age 1 equivalents and 5,100 The results of EPA’s evaluation of the pounds of lost fishery yield per year. dollar value of impingement and EPA evaluated cumulative The cumulative entrainment impact entrainment losses at Brayton Point (as impingement and entrainment impacts amounts to 3.8 million age 1 equivalents calculated using benefits transfer) at the Brayton Point Station facility in Mount Hope Bay in Somerset, and 70,400 pounds of lost fishery yield indicate that baseline economic losses Massachusetts. EPA estimates that the each year. range from $7,000 to $12,000 per year cumulative impingement impact is for impingement and from $166,000 to VerDate 11 $303,000 per year for entrainment (all in over 20 years). Combining both and entrainment on fish populations are 2001$). approaches, the value of impingement constant over time (i.e., that fish kills do EPA also developed an Habitat-based and entrainment losses at Brayton Point not have cumulatively greater impacts Replacement Cost (HRC) analysis to range from approximately $9,000 to on diminished fish populations). EPA examine the costs of restoring $890,00 per year for impingement, and also did not analyze whether the impingement and entrainment losses at from $0.2 million to $28.3 million per number of fish affected by impingement Brayton Point. These HRC estimates year for entrainment (all in 2001$) (see and entrainment would increase as were merged with the benefits transfer Exhibit 19). populations increase in response to results to develop a more For a variety of reasons, EPA believes improved water quality or other comprehensive range of loss estimates. that the estimates developed here improvements in environmental The HRC results were used as an upper underestimate the total economic bound and the midpoint of the benefits benefits of reducing impingement and conditions. In the economic analyses, transfer method was used as a lower entrainment at Brayton Point. EPA EPA also assumed that fishing is the bound (HRC annualized at 7 percent assumed that the effects of impingement only recreational activity affected. EXHIBIT 19.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR BRAYTON POINT Impingement Entrainment One In Scope Facility a. age 1 equivalent fish lost ...... >69,300/yr ...... >3.8 mil/yr. b. # lbs lost to landed fishery ...... >5,100 lbs/yr ...... >70,400 lbs/yr. c. $ value of loss (2001$) ...... $9,000–$890,000/yr ...... $0.2 mil–$28.3 mil/yr. 7. Seabrook Pilgrim to be underestimated. There also are impingement and entrainment losses at The results of EPA’s evaluation of several important factors in addition to Pilgrim. Using the HRC approach, the impingement and entrainment rates at the intake location (nearshore versus value of impingement and entrainment Seabrook and Pilgrim indicate that offshore) that complicate the losses at Pilgrim are approximately impingement and entrainment at comparison of impingement and $507,000 for impingement, and over Seabrook’s offshore intake is entrainment at the Seabrook facility to $9.3 million per year for entrainment substantially less than impingement and impingement and entrainment at (HRC annualized at 7 percent over 20 entrainment at Pilgrim’s nearshore Pilgrim (e.g., entrainment data are based years) (all in 2001$). These HRC intake. Impingement per MGD averages on different flow regimes, different estimates were merged with the benefits 68 percent less and entrainment years of data collection, and protocols transfer results to develop a more averages 58 percent less at Seabrook. for reporting monitoring results). comprehensive range of loss estimates. The species most commonly impinged Average impingement losses at These HRC estimates were merged at both facilities are primarily winter Seabrook are valued at between $3,500 with the benefits transfer results to flounder, Atlantic herring, Atlantic and $5,200 per year, and average develop a more comprehensive range of menhaden, and red hake. These are entrainment losses are valued at loss estimates. The HRC results were species of commercial and recreational between $142,000 and $315,000 per used as an upper bound and the interest. However, the species most year (all in 2001$) (see Exhibit 20). midpoint of the benefits transfer method commonly entrained at the facilities are Average impingement losses at Pilgrim was used as a lower bound (HRC predominately forage species. Because it are valued at between $3,300 and $5,000 annualized at 7 percent over 20 years). is difficult to assign an economic value per year, and average entrainment losses Combining both approaches, the value to such losses, and because entrainment are valued at between $523,500 and of impingement and entrainment losses losses are much greater than $759,300 per year (all in 2001$). These at Pilgrim range from approximately impingement losses, the benefits of an values reflect estimates derived using $4,000 to $507,00 per year for offshore intake or other technologies benefits transfer. impingement, and from $0.6 million to that may reduce impingement and EPA also developed an HRC analysis $9.3 million per year for entrainment entrainment at these facilities are likely to examine the costs of restoring (all in 2001$) (see Exhibit 21). EXHIBIT 20.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR SEABROOK Impingement Entrainment One In Scope Facility: Seabrook a. age 1 equivalent fish lost ...... > 1.8 mil/yr ...... > 290,000/yr b. # lbs lost to landed fishery ...... > 21.4 mil lbs/yr ...... > 404,000 lbs/yr c. $ value of loss (2001$) ...... $3,000–$5,000 ...... $142,000–$315,000 EXHIBIT 21.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR PILGRIM Impingement Entrainment One In Scope Facility: Pilgrim Losses Using Benefits Transfer a. age 1 equivalent fish lost ...... > 1.8 mil/yr ...... > 290,000/yr VerDate 11 EXHIBIT 21.—BASELINE IMPACTS (ANNUAL AVERAGE) FOR PILGRIM—Continued Impingement Entrainment b. # lbs lost to landed fishery ...... > 21.4 mil lbs/yr ...... > 404,000 lbs/yr c. $ value of loss (2001$) ...... $3,000–$5,000/yr ...... $0.5 mil–$0.7 mil/yr Pilgrim Losses Using HRC as Upper Bounds and Benefits Transfer Midpoints as Lower a. age 1 equivalent fish lost ...... > 1.8 mil/yr ...... > 290,000/yr b. # lbs lost to landed fishery ...... > 21.4 mil lbs/yr ...... > 404,000 lbs/yr c. $ value of loss (2001$) ...... $4,000–$507,000/yr ...... $0.6 mil–$9.3 mil/yr 8. Monroe impingement and entrainment losses at For a variety of reasons, EPA believes EPA estimates that the baseline Pilgrim. These HRC estimates were that the estimates developed here impingement losses at the Monroe merged with the benefits transfer results underestimate the total economic facility are 35.8 million age 1 to develop a more comprehensive range benefits of reducing impingement and equivalents and 1.4 million pounds of of loss estimates. These HRC estimates entrainment at the Monroe facility. EPA lost fishery yield per year. Baseline were merged with the benefits transfer assumed that the effects of impingement entrainment impacts amount to 11.6 results to develop a more and entrainment on fish populations are million age 1 equivalents and 608,300 comprehensive range of loss estimates. constant over time (i.e., that fish kills do pounds of lost fishery yield each year. The HRC results were used as an upper not have cumulatively greater impacts The results of EPA’s evaluation of the bound and the midpoint of the benefits on diminished fish populations). EPA dollar value of baseline impingement transfer method was used as a lower also did not analyze whether the and entrainment losses at Monroe (as bound (HRC annualized at 7 percent number of fish affected by impingement over 20 years). Combining both calculated using benefits transfer) and entrainment would increase as approaches, the value of impingement indicate that baseline economic losses populations increase in response to and entrainment losses at Monroe range range from $502,200 to $981,750 per improved water quality or other year for impingement and from from approximately $0.7 million to $5.6 improvements in environmental $314,600 to $2,298,500 per year for per year for impingement, and from $1.3 conditions. In the economic analyses, entrainment (all in 2001$). million to $13.9 million per year for EPA also developed an HRC analysis entrainment (all in 2001$) (see Exhibit EPA also assumed that fishing is the to examine the costs of restoring 22). only recreational activity affected. EXHIBIT 22.—BASELINE LOSSES AT (ANNUAL AVERAGE) MONROE (USING HRC VALUES AS UPPER BOUNDS) Impingement Entrainment One In Scope Facility a. age 1 equivalent fish lost ...... > 1.8 mil/yr ...... > 290,000/yr b. # lbs lost to landed fishery ...... > 21.4 mil lbs/yr ...... > 404,000 lbs/yr c. $ value of loss (2001$) ...... $0.7 mil–$5.6 mil ...... $1.3 mil–$13.9 mil F. Estimates of National Benefits attributes) in which it is located. To develop a feasible, tractable manner Benefits potential settings can thus be for developing national benefits 1. Methodology defined by the various possible estimates from a small number of case In order to compare benefits to costs combinations of stressor (facility) and study investigations, EPA made its for a national rulemaking such as the receptor (waterbody, etc) combinations. national extrapolations on the basis of a section 316(b) proposed rule for Phase Ideally, case studies would be combination of three relevant variables: II existing facilities, there is a need to selected to represent each of these (1) The volume of water (operational generate national estimates of both costs ‘‘benefits potential’’ settings and then flow) drawn by a facility; (2) the level and benefits. This section describes the could be used to extrapolate to like- of recreational angling activity within methodology EPA has developed to characterized facility-waterbody setting the vicinity of the facility; and (3) the provide national estimates of benefits. cooling water intake structure sites. type of waterbody on which the facility Because benefits are very site-specific, However, data limitations and other is located. Extrapolations were then there are limited options for how EPA considerations precluded EPA from can develop national-level benefits made across facilities according to their developing enough case studies to respective waterbody type. estimates from a diverse set of over 500 reflect the complete range of benefits- regulated entities. EPA could only potential settings. Data limitations also The first of these variables— develop a limited number of case made it difficult to reliably assign operational flow (measured as millions studies, and to interpret these cases in facilities to the various benefits of gallons per day, or MGD)—reflects a national context, the Agency potential categories. the degree of stress caused by a facility. identified a range of settings that reflect Based on the difficulties noted above, The second variable —the number of the likely benefits potential of a given EPA adopted a more practical, angler days in the area (measured as the type of facility (and its key stressor- streamlined extrapolation version of its number of recreational angling days related attributes) in combination with preferred approach, as this is the only within a 120 mile radius) — reflects the the waterbody characteristics (receptor viable approach available to the Agency. degree to which there is a demand VerDate 11 (value) by local residents to use the For rural counties, included in this group, and were fishery that is impacted. The third Angling Days = State Rural Angling considered separately). The waterbody variable—waterbody type (e.g., estuary, Days * County Pop/State Pop in Rural classifications for freshwater rivers and ocean, freshwater river or lake, or Great Counties lakes/reservoirs were grouped together Lakes)—reflects the types, numbers, and EPA determined urban and rural for the extrapolation due to similar life stages of fish and other biological population by State by summing the ecological and hydrological receptors that are impacted by the 1999 county populations for the State’s characteristics of freshwater systems facilities. Accordingly, the urban and rural counties respectively. used as cooling water. The majority of extrapolations based on these three EPA determined each county’s urban/ these hydrologic systems have variables reflect the key factors that rural status using definitions developed undergone some degree of modification affect benefits: the relevant stressor, the by the U.S. Department of Agriculture for purposes such as water storage, flood biological receptors, and the human (as included in NORSIS 1997). These control, and navigation. The degree of demands for the natural resources and index values are based upon the modification can vary very little or quite services impacted. estimated number of angling days by dramatically. A facility falling into the Flow: The flow variable the Agency residents living near the facility. The lake/reservoir category may withdraw developed is the monetized benefits per index value for each facility is a cooling water from a lake that has been volume of water flowing through measure of the facility’s share of the reclassified as a reservoir due to the cooling water intake structures, in total angling days estimated at all in addition of an earthen dam, or from a specific, applying a metric of ‘‘dollars scope facilities located on a similar reservoir created by the diversion of a per million gallons per day’’ ($/MGD), waterbody. river through a diversion canal for use where MGD levels are based on average The analysis then proceeded by as a cooling lake. The species operational flows as reported by the waterbody type. composition and ecology of these two facilities in the EPA Section 316(b) Estuaries waterbodies may vary greatly. While the Detailed Questionnaire and Short ecology of river systems and lakes or Technical Questionnaire responses, or National baseline losses and benefits reservoirs are considerably different, through publically available data. for estuaries were based on the Salem due to structural modifications these Angler days. The angler day variable and Tampa Bay case studies. The case two classifications may be quite similar the Agency used is based on data studies were extrapolated to other ecologically depending on the developed by the U.S. Fish and Wildlife facilities on the basis of regional fishery waterbody in question. For example, Survey as part of its 1996 National types, in an effort to reflect the different many river systems, including the Ohio Survey of Fishing, Hunting, and types of fisheries that are impacted in River, are now broken up into a series Wildlife-Associated Recreation. These various regions of the country’s coastal of navigational pools controlled by data were interpreted within a GIS- waters. As such, the Tampa Bay case dams that may function more similarly based approach to estimate the level of study results were applied to estuary to a reservoir than a naturally flowing recreational angling pursued by facilities located in Florida and other river. populations living within 120 miles of Gulf Coast States, and the Salem results Baseline losses and benefits in the each facility (additional detail is were applied to all remaining estuary Ohio case study were based on 29 in provided in the EBA). facilities (note that the Salem results scope facilities in the Ohio River case In developing the index, EPA used a used for the extrapolation differ from study area. The Agency extrapolated GIS analysis to identify counties within the case study results presented above these losses to all in scope facilities on a 120 mile radius of each facility. The in order to reflect losses without a other freshwater rivers, lakes, and area for each facility included the screen currently in place at the facility). reservoirs. county the facility is located in and any Ideally, a West Coast facility would Oceans and Great Lakes other county with 50 percent or more of have served as the basis of extrapolation its population residing within 120 miles to estuarine facilities along the Pacific Oceans and Great Lakes estimates of the facility. EPA estimated angling Coast, but EPA could not develop a were based on extrapolations from the activity levels for two types of angling suitable case study for that purpose in Pilgrim and JR Whiting facility case days for each county: freshwater angling time for this proposal. However, EPA studies, respectively. For these two days and saltwater angling days. intends to develop such a western facilities (and their associated Estimated angling days for the estuary case study and report its waterbody types), the valuation method appropriate waterbody type were findings in an anticipated forthcoming applied by EPA in the national summed across all counties in a Notice of Data Availability. extrapolations was based on the Habitat- facility’s area to yield estimated angling In order to extrapolate baseline losses based Replacement Cost approach, days near the facility. For each type of from the Salem and Big Bend facilities which reflects values for addressing a angling, EPA estimated angling days by to all in scope facilities on estuaries, much greater number of impacted county residents as a percentage of the EPA calculated an index of angling species (not just the small share that are State angling days by residents 16 years activity for each of these in scope recreational or commercial species that and older reported in the 1996 National facilities. The angling index is a are landed by anglers). For example, at Survey of Fishing, Hunting, and percentage value that ranges from 0 to JR Whiting, the benefits transfer Wildlife-Associated Recreation 1. Dividing baseline losses at a facility approach developed values for (USFWS, 1997). Angling days in each by the index value provides an estimate recreational angling amounted to only 4 State were partitioned into days by of total baseline losses at all in scope percent of the estimated total urban anglers and days by rural anglers facilities located on waterbodies in the impingement losses, and reflected only based on the U.S. percentages reported same category. 0.02 percent of the age 1 fish lost due in the 1996 National Survey. to impingement. At Pilgrim, the benefits For urban counties, Rivers and Lakes transfer approach reflected recreational Angling Days = State Urban Angling EPA combined rivers, lakes and losses for only 0.5 percent of the Days * County Pop/State Pop in reservoirs into one class of freshwater- entrained age 1 equivalent fish at that Urban Counties based facilities (Great Lakes are not site. Because the Agency was able to VerDate 11 develop HRC values for these sites and (MGD) index for oceans and the Great used for extrapolating case study recreational fishery impacts were such a Lakes. baseline losses to national baseline small part of the impacts, EPA Results losses for all in scope facilities are extrapolated only based on HRC reported in Exhibit 23 below. estimates and used only the flow-based The results of the index calculations for operational flow and angling effort EXHIBIT 23.—FLOW AND ANGLING INDICES Normalized Percent of Waterbody Type Based on MGD in scope an- percent gling base Estuary-N. Atlantic ...... Salem ...... 4.39 2.10 Estuary-S. Atlantic ...... 4 Tampa Bay facilities ...... 19.24 20.28 Freshwater systems ...... 29 Ohio River facilities ...... 9.30 12.34 Great Lake ...... JR Whiting ...... 3.92 13.89 Ocean ...... Pilgrim ...... 3.42 6.54 Waterbody waterbody categories ‘‘freshwater developing an order-of-magnitude EPA further tailored its extrapolation rivers’’, and ‘‘lakes/reservoirs’’ were national-level estimate of benefits. • The recreational participation level approach, so that monetized benefits grouped together. The facilities chosen for extrapolation (angler day) variable provides a logical estimates are based on available data for are expected to have relatively average basis to reflect the extent of human user similar types of waterbody settings. benefits per MGD and angling day demands for the fishery and other Thus, for example, the case study index, for their respective waterbody resources affected by impingement and results for the Salem facility (located in types. Benefits per MGD and angling entrainment. the Delaware Estuary) and the Tampa day index are not expected to be • The estimates are not biased in facilities are applied (on a per MGD and extremely high or low relative to other either direction. angling day index basis) only to other facilities. EPA was careful not to use Some of the disadvantages of the use facilities located in estuary waters. facilities that were unusual in this of extrapolating results on the basis of Likewise, results from Ohio River regard. Salem is located in the waterbody type, recreational angling facilities are applied to inland transitional zone of the estuary, a lesser day data, and operational flows (MGD) freshwater water cooling water intake productive part of the estuary. include: structures (excluding facilities on the The use of flow and angler day basis • The approach may not reflect all of Great Lakes), and losses estimated for for extrapolation has some practical the variability that exists in the Pilgrim facility are applied to advantages and basis in logic; however, impingement and entrainment impacts facilities using ocean waters at their it also has some less than fully (and monetized losses or benefits) intakes, and results for J.R. Whiting are satisfactory implications. The within waterbody classifications. For used for the Great Lakes facilities. advantages of using this extrapolation example, within and across U.S. As noted above, the waterbody approach include: estuaries, there may be different species, classifications for freshwater rivers and • Feasibility of application, because numbers of individuals, and life stages lakes or reservoirs were grouped the extrapolation relies on waterbody present at different cooling water intake together for the extrapolation due to type, angler demand, and MGD data that structures. similar ecological and hydrological are available for all in scope facilities. • The approach may not reflect all of characteristics of freshwater systems • Selectively extrapolating case study the variability that exists in used as cooling water. The majority of results to facilities on like types of impingement and entrainment impacts these hydrologic systems have waterbodies reflects the type of aquatic (and monetized losses or benefits) undergone some degree of modification setting impacted, which is intended to across operational flow levels (MGD) at for purposes such as water storage, flood capture the number and types of species different facilities within a given control, and navigation. Due to impacted by impingement and waterbody type. structural modifications, these entrainment at such facilities (i.e., Extrapolating to national benefits freshwater waterbody types be quite impacts at facilities on estuaries are according to flow (MGD), angling levels, similar ecologically. For example, many more similar to impacts at other estuary- and waterbody type, as derived from river systems, including the Ohio River, based cooling water intake structures estimates for a small number of case are now broken up into a series of than they are to facilities on inland studies, may introduce inaccuracies into navigational pools controlled by dams waters). national estimates. This is because the that may function more similarly to a • Flow in MGD is a useful proxy for three variables used as the basis for the reservoir than a naturally flowing river. the scale of operation at cooling water extrapolation (MGD, recreational The natural species distribution, intake structures, a variable that angling days, and waterbody type) may genetic movement, and seasonal typically will have a large impact on not account for all of the variability migration of aquatic organisms that may baseline losses and potential regulatory expected in site-specific benefits levels. be expected in a natural system is benefits. The case studies may not reflect the affected by factors such as dams, • While there may be a high degree of average or ‘‘typical’’ cooling water stocking of fish, and water diversions. variability in the actual losses (and intake structures impacts on a given Since the degree of modification of benefits) per MGD across facilities that type of waterbody (i.e., the extrapolated inland waterbodies and the occurrence impact similar waterbodies, the results might under- or over-state the of fish stocking could not be determined extrapolations are expected to be physical and dollar value of impacts per for every cooling water source, the reasonably accurate on average for MGD and fishing day index, by VerDate 11 waterbody type). The inaccuracies the 539 facilities found to be in scope impingement and/or entrainment. In introduced to the national-level of the section 316(b) Phase II such cases, baseline losses as estimates by this extrapolation approach rulemaking. The benefits estimates were appropriate to the national extrapolation are of unknown magnitude or direction derived in a multi-step process that were estimated using data for years (i.e., the estimates may over- or used operational flows and the prior to the facilities’ actions (e.g., based understate the anticipated national-level recreational fishing index as the basis on impingement and entrainment before benefits), however EPA has no data to for extrapolating case study results to the impingement deterrent net was indicate that the case study results are the national level. installed at JR Whiting). These pre- atypical for each waterbody type. In the first step, EPA used the action baselines provide a basis for baseline losses (dollars per year) derived examining other facilities that have not 2. Results of National Benefits from the analysis of facilities examined yet taken actions to reduce impingement Extrapolation in the case studies. In some instances, and/or entrainment. Baseline losses at National benefits for 3 regulatory the case study facilities had already the selected case study facilities are compliance options were estimated for implemented some measures to reduce summarized in Exhibit 24. EXHIBIT 24.—BASELINE LOSSES FROM SELECTED CASE STUDIES [Baseline losses from selected case studies, values in thousands of 2001$] Impingement Entrainment Case study Low Mid High Low Mid High Salem ...... $528 $704 $879 $16,766 $23,657 $30,548 Brayton ...... 9 450 890 235 14,261 28,288 Contra Costa ...... 2,666 5,726 8,785 6,413 13,630 20,847 Pittsburgh ...... 10,096 22,268 34,440 19,166 40,760 62,354 4 Tampa Bay Facilities ...... 801 809 817 20,007 20,454 20,901 29 Ohio Facilities ...... 3,452 4,052 4,652 9,257 9,584 9,912 Monroe ...... 742 3,190 5,639 1,307 7,604 13,902 JR Whiting ...... 358 797 1,235 42 873 1,703 Pilgrim Nuclear ...... 4 256 507 642 4,960 9,279 In the second step, EPA extrapolated the index of operational flow for each extrapolated. This resulted in a national the baseline dollar loss estimates from facility by the estimated dollar losses at estimate of baseline monetizable losses the case study models to all of the baseline per unit flow, based on each for all 539 in scope facilities as remaining 539 facilities by multiplying facility’s source waterbody type, were summarized in Exhibit 25. EXHIBIT 25.—BASELINE LOSSES EXTRAPOLATED TO ALL IN SCOPE FACILITIES USING MGD ONLY [Baseline losses extrapolated to all in scope facilities—MGD only, values in thousands of 2001$] Impingement Entrainment Facility Case study Low Mid High Low Mid High Estuary, Non Gulf Salem ...... Delaware ...... $528 $704 $879 $16,766 $23,657 $30,548 Brayton Point ...... Brayton ...... 9 450 890 235 14,261 28,288 Contra Costa ...... California ...... 2,666 5,726 8,785 6,413 13,630 20,847 Pittsburgh ...... California ...... 10,096 22,268 34,440 19,166 40,760 62,354 All Other In Scope ...... 11,167 14,875 18,583 354,346 499,991 645,636 All 78 In Scope ...... 24,467 44,022 63,578 396,925 592,298 787,672 Estuary, Gulf Coast 4 Tampa Facilities ...... Tampa Bay ...... 801 809 817 20,007 20,454 20,901 All Other In Scope ...... 3,361 3,395 3,429 83,982 85,857 87,732 All 30 In Scope ...... 4,162 4,204 4,247 103,989 106,311 108,633 Freshwater 29 Ohio Facilities ...... Ohio ...... 3,452 4,052 4,652 9,257 9,584 9,912 Monroe ...... Monroe ...... 742 3,190 5,639 1,307 7,604 13,902 All Other In Scope ...... 33,317 39,111 44,906 89,348 92,514 95,679 All 393 In Scope ...... 37,511 46,353 55,196 99,911 109,702 119,493 Great Lake JR Whiting ...... JR Whiting ...... 358 797 1,235 42 873 1,703 All Other In Scope ...... 8,774 19,523 30,271 1,025 21,385 41,745 All 16 In Scope ...... 9,132 20,319 31,506 1,067 22,257 43,448 VerDate 11 EXHIBIT 25.—BASELINE LOSSES EXTRAPOLATED TO ALL IN SCOPE FACILITIES USING MGD ONLY—Continued [Baseline losses extrapolated to all in scope facilities—MGD only, values in thousands of 2001$] Impingement Entrainment Facility Case study Low Mid High Low Mid High Ocean Pilgrim Nuclear ...... Pilgrim ...... 4 256 507 642 4,960 9,279 All Other In Scope ...... 115 7,219 14,323 18,127 140,146 262,165 All 22 In Scope ...... 119 7,475 14,830 18,769 145,106 271,444 Total All Facilities All 539 In Scope ...... 75,390 122,374 169,357 620,661 975,675 1,330,690 In the third step, the Agency the angling index values for each case described above. The results are extrapolated baseline losses from the study. The calculation of the index is summarized in Exhibit 26. case studies were also developed using EXHIBIT 26.—BASELINE LOSSES EXTRAPOLATED—ANGLING DAYS ONLY [Values in thousands of 2001$] Impingement Entrainment Facility Case Study Low Mid High Low Mid High Estuary, Non Gulf Salem ...... Delaware ...... $528 $704 $879 $16,766 $23,657 $30,548 Brayton Point ...... Brayton ...... 9 450 890 235 14,261 28,288 Contra Costa ...... California ...... 2,666 5,726 8,785 6,413 13,630 20,847 Pittsburgh ...... California ...... 10,096 22,268 34,440 19,166 40,760 62,354 All Other In Scope ...... 23,840 31,755 39,671 756,471 1,067,399 1,378,327 All 78 In Scope ...... 37,139 60,903 84,667 799,050 1,159,706 1,520,363 Estuary, Gulf Coast 4 Tampa Facilities ...... Tampa Bay ...... $801 $809 $817 $20,007 $20,454 $20,901 All Other In Scope ...... 3,148 3,180 3,212 78,664 80,421 82,177 All 30 In Scope ...... 3,949 3,989 4,029 98,672 100,875 103,078 Freshwater 29 Ohio Facilities ...... Ohio ...... $3,452 $4,052 $4,652 $9,257 $9,584 $9,912 Monroe ...... Monroe ...... 742 3,190 5,639 1,307 7,604 13,902 All Other In Scope ...... 23,203 27,238 31,273 62,224 64,429 66,633 All 393 In Scope ...... 27,396 34,480 41,564 72,787 81,617 90,447 Great Lake JR Whiting ...... JR Whiting ...... $358 $797 $1,235 $42 $873 $1,703 All Other In Scope ...... 2,231 4,965 7,698 261 5,438 10,616 All 16 In Scope ...... 2,589 5,761 8,933 302 6,311 12,319 Ocean Pilgrim Nuclear ...... Pilgrim ...... $4 $256 $507 $642 $4,960 $9,279 All Other In Scope ...... 56 3,529 7,001 8,861 68,504 128,147 All 22 In Scope ...... 60 3,784 7,508 9,502 73,464 137,426 Total All Facilities All 539 In Scope ...... $71,134 $108,918 $146,701 $980,314 $1,421,974 $1,863,633 As a fourth step, EPA calculated the equal-weighted extrapolation measure scope facilities in each waterbody type. average baseline losses of the flow-based of each case study facility’s baseline The results of this average are reported results and the angling-based results. loss, based on it’s percent share of flow in Exhibit 27. This develops results that reflect an and recreational fishing relative to all in VerDate 11 EXHIBIT 27.—BASELINE LOSSES EXTRAPOLATED TO ALL IN SCOPE FACILITIES—MEANS OF MGD AND ANGLING [Values in thousands of 2001$] Impingement Entrainment Facility Case Study Low Mid High Low Mid High Estuary, Non Gulf Salem ...... Delaware ...... $528 $704 $879 $16,766 $23,657 $30,548 Brayton Point ...... Brayton ...... 9 450 890 235 14,261 28,288 Contra Costa ...... California ...... 2,666 5,726 8,785 6,413 13,630 20,847 Pittsburgh ...... California ...... 10,096 22,268 34,440 19,166 40,760 62,354 All Other In Scope ...... 17,503 23,315 29,127 555,409 783,695 1,011,981 All 78 In Scope ...... 30,803 52,463 74,122 597,988 876,002 1,154,017 Estuary. Gulf Coast 4 Tampa Facilities ...... Tampa Bay ...... $801 $809 $817 $20,007 $20,454 $20,901 All Other In Scope ...... 3,255 3,288 3,321 81,323 83,139 84,955 All 30 In Scope ...... 4,055 4,097 4,138 101,330 103,593 105,856 Freshwater 29 Ohio Facilities ...... Ohio ...... $3,452 $4,052 $4,652 $9,257 $9,584 $9,912 Monroe ...... Monroe ...... 742 3,190 5,639 1,307 7,604 13,902 All Other In Scope ...... 28,260 33,175 38,089 75,786 78,471 81,156 All 393 In Scope ...... 32,453 40,417 48,380 86,349 95,660 104,970 Great Lake JR Whiting ...... JR Whiting ...... $358 $797 $1,235 $42 $873 $1,703 All Other In Scope ...... 5,503 12,244 18,985 643 13,412 26,180 All 16 In Scope ...... 5,861 13,040 20,220 685 14,284 27,884 Ocean Pilgrim Nuclear ...... Pilgrim ...... $4 $256 $507 $642 $4,960 $9,279 All Other In Scope ...... 86 5,374 10,662 13,494 104,325 195,156 All 22 In Scope ...... 90 5,629 11,169 14,135 109,285 204,435 Total All Facilities All 539 In Scope ...... $73,262 $115,642 $158,029 $800,487 $1,198,824 $1,597,162 In the fifth step, EPA selected the set range of loss estimates, plus the impingement and entrainment, whereas of extrapolation values the Agency application of all three extrapolation the benefits transfer approach addressed believes are the most reflective of the variables). losses only for a small share of the baseline loss scenarios that applied in For oceans and the Great Lakes, EPA impacted fish. Since recreational fish each waterbody type. For estuaries and developed national-scale estimates impacts were an extremely small share freshwater facilities, EPA used the using its HRC-based loss estimates, of the total fish impacts at these sites, midpoint of its loss estimates of because EPA was able to develop HRC EPA extrapolated the HRC findings impingement and entrainment at the estimates for these sites, and because using only the MGD-based index (i.e., case study facilities, and then applied these HRC values are more the angler-based index was not the average of the MGD- and angler- comprehensive than the values derived relevant). based extrapolation results. This using the more traditional benefits The results of EPA’s assessment of its provides estimates of national baseline transfer approach. The HRC estimates best estimates for baseline losses due to losses that reflect the broadest set of cover losses for a much larger impingement and entrainment are values and parameters (i.e., the full percentage of fish lost due to shown in Exhibit 28. EXHIBIT 28.—BEST ESTIMATE BASELINE LOSSES [Best estimate baseline losses, values in thousands of 2001$] Facility Case study Impingement Entrainment Salem ...... Delaware ...... $704 $23,657 Brayton Point ...... Brayton ...... 450 14,261 Contra Costa ...... California ...... 5,726 13,630 Pittsburgh ...... California ...... 22,268 40,760 All Other In Scope ...... 23,315 783,695 All 78 In Scope ...... 52,463 876,002 VerDate 11 EXHIBIT 28.—BEST ESTIMATE BASELINE LOSSES—Continued [Best estimate baseline losses, values in thousands of 2001$] Facility Case study Impingement Entrainment Estuary and Gulf Coast 4 Tampa Facilities ...... Tampa Bay ...... $809 $20,454 All Other In Scope ...... 3,288 83,139 All 30 In Scope ...... 4,097 103,593 Freshwater 29 Ohio Facilities ...... Ohio ...... $4,052 $9,584 Monroe ...... Monroe ...... 3,190 7,604 All Other In Scope ...... 30,891 73,069 All 393 In Scope ...... 38,133 90,258 Great Lake JR Whiting ...... JR Whiting ...... $1,235 $1,703 All Other In Scope ...... 30,271 41,745 All 16 In Scope ...... 31,506 43,448 Ocean Pilgrim Nuclear ...... Pilgrim ...... $507 $9,279 All Other In Scope ...... 14,323 262,165 All 22 In Scope ...... 14,830 271,444 Total All Facilities All 539 In Scope ...... $141,029 $1,384,745 In the sixth and final step, EPA commensurate with the use of closed- entrainment to levels established based estimated the potential benefits of each cycle, recirculating cooling water on the use of design and construction or regulatory option by applying a set of systems based on location and the operational measures; estimated percent reductions in baseline percentage of the source waterbody they Option 4 requires all Phase II existing losses. The percent reduction in withdraw for cooling; facilities to reduce intake capacity baseline losses for each facility reflects Option 2 is variation of Option 1, but commensurate with the use of closed- EPA assessment of (1) regulatory embodies a two-track approach whereby cycle, recirculating cooling water baseline conditions at the facility (i.e., some facilities may use site-specific systems; current practices and technologies in studies to comply using alternative place), and (2) the percent reductions in approaches; Option 5 requires that all Phase II impingement and entrainment that EPA Option 3 (the Agency’s preferred existing facilities reduce intake capacity estimated would be achieved at each option) requires all Phase II existing commensurate with the use of dry facility that the Agency believes would facilities to reduce impingement and cooling systems. be adopted under each regulatory entrainment to levels established based The results of EPA approach to option. The options portrayed in the on the use of design and construction or estimating national benefits are shown Exhibits correspond to the following operational measures, except for in Exhibits 29 through 32 (note that the technical descriptions of each facilities that are below flow thresholds percent reductions shown in these alternative: for lakes and rivers; exhibits are the flow-weighted average Option 1 requires all Phase II existing Option 3a is a variation of Option 3, reductions across all facilities in each facilities located on different categories wherein all Phase II existing facilities waterbody category for each regulatory of waterbodies to reduce intake capacity are required to reduce impingement and option). EXHIBIT 29.—IMPINGEMENT BENEFITS FOR VARIOUS OPTIONS—BY REDUCTION LEVEL Baseline im- Percentage Reductions Waterbody Type Facility pingement OPTION 1 OPTION 2 OPTION 3 OPTION 3a OPTION 4 OPTION 5 loss percent percent percent percent percent percent Estuary—NonGulf All 78 In Scope ..... $52,463 64.5 47.5 33.2 25.0 40.9 97.5 Estuary—Gulf ...... All 30 In Scope ..... 4,097 63.2 45.9 26.5 30.0 45.3 96.7 Freshwater ...... All 393 In Scope ... 40,417 47.3 47.3 47.3 46.7 59.0 98.0 Great Lake ...... All 16 In Scope ..... 31,506 80.0 80.0 80.0 77.0 88.6 96.3 Ocean ...... All 22 In Scope ..... 14,830 73.2 59.0 50.6 47.2 59.7 88.8 ALL ...... All 539 In Scope ... 143,312 VerDate 11 EXHIBIT 30.—IMPINGEMENT BENEFITS FOR VARIOUS OPTIONS—BY BENEFIT LEVEL Baseline im- Benefits (Values in thousands of 2001$) Waterbody type Facility pingement loss OPTION 1 OPTION 2 OPTION 3 OPTION 3a OPTION 4 OPTION 5 Estuary—NonGulf All 78 In Scope ..... $52,463 $33,834 $24,909 $17,418 $13,125 $21,470 $51,141 Estuary—Gulf ...... All 30 In Scope ..... 4,097 2,588 1,882 1,087 1,230 1,856 3,961 Freshwater ...... All 393 In Scope ... 40,417 19,117 19,117 19,117 18,855 23,828 39,605 Great Lake ...... All 16 In Scope ..... 31,506 25,205 25,205 25,205 24,260 27,900 30,326 Ocean ...... All 22 In Scope ..... 14,830 10,849 8,746 7,503 6,995 8,858 13,168 ALL ...... All 539 In Scope ... 143,312 91,593 79,858 70,329 64,465 83,911 138,201 EXHIBIT 31.—ENTRAINMENT BENEFITS FOR VARIOUS OPTIONS—BY REDUCTION LEVEL Entrainment percentage reductions Baseline Waterbody type Facility loss OPTION 1 OPTION 2 OPTION 3 OPTION 3a OPTION 4 OPTION 5 percent percent percent percent percent percent Estuary—NonGulf All 78 In Scope ..... $876,002 67.2 59.1 48.5 47.1 79.2 97.5 Estuary—Gulf ...... All 30 In Scope ..... 103,593 66.9 52.3 47.0 47.8 79.3 96.7 Freshwater ...... All 393 In Scope ... 95,660 12.4 12.4 12.4 44.2 72.7 98.0 Great Lake ...... All 16 In Scope ..... 43,448 57.8 57.8 57.8 57.8 88.6 96.3 Ocean ...... All 22 In Scope ..... 271,444 74.2 58.9 45.0 45.0 74.1 88.8 ALL ...... All 539 In Scope ... 1,390,147 EXHIBIT 32.—ENTRAINMENT BENEFITS FOR VARIOUS OPTIONS—BY BENEFIT LEVEL Entrainment benefit (Values in thousands of 2001$) Waterbody type Facility Baseline loss OPTION 1 OPTION 2 OPTION 3 OPTION 4 OPTION 5 OPTION 6 Estuary—NonGulf All 78 In Scope ..... $876,002 $588,552 $517,960 $424,708 $412,696 $693,420 $853,940 Estuary—Gulf ...... All 30 In Scope ..... 103,593 69,324 54,206 48,645 49,508 82,186 100,175 Freshwater ...... All 393 In Scope ... 95,660 11,883 11,883 11,883 42,277 69,575 93,738 Great Lake ...... All 16 In Scope ..... 43,448 25,092 25,092 25,092 25,092 38,474 41,820 Ocean ...... All 22 In Scope ..... 271,444 201,301 159,809 122,098 122,098 201,025 241,020 ALL ...... All 539 In Scope ... 1,390,147 896,152 768,950 632,426 651,671 1,084,681 1,330,694 In addition, EPA developed a more to 90 percent) of potential reductions in 33. Finally, the benefits estimated for generic illustration of potential benefits, impingement and entrainment. These Option 3, the Agency’s preferred option, based on a broad range (from 10 percent illustrative results are shown in Exhibit are detailed in Exhibit 34. EXHIBIT 33.—SUMMARY OF POTENTIAL BENEFITS ASSOCIATED WITH VARIOUS IMPINGEMENT AND ENTRAINMENT REDUCTION LEVELS Benefits (values in thousands of Reduction level 2001$) percent Impingement Entrainment 10 ...... All 539 In Scope ...... $14,331 $139,015 20 ...... All 539 In Scope ...... 28,662 278,029 30 ...... All 539 In Scope ...... 42,994 417,044 40 ...... All 539 In Scope ...... 57,325 556,059 50 ...... All 539 In Scope ...... 71,656 695,073 60 ...... All 539 In Scope ...... 85,987 834,088 70 ...... All 539 In Scope ...... 100,319 973,103 80 ...... All 539 In Scope ...... 114,650 1,112,118 90 ...... All 539 In Scope ...... 128,981 1,251,132 EXHIBIT 34.—SUMMARY OF BENEFITS FROM IMPINGEMENT CONTROLS ASSOCIATED WITH OPTION 3 Benefits (values in thousands of Waterbody type Facility 2001$) Impingement Entrainment Estuary—NonGulf ...... All 78 In Scope ...... $17,418 $424,708 Estuary—Gulf ...... All 30 In Scope ...... 1,087 48,645 Freshwater ...... All 393 In Scope ...... 19,117 11,883 VerDate 11 EXHIBIT 34.—SUMMARY OF BENEFITS FROM IMPINGEMENT CONTROLS ASSOCIATED WITH OPTION 3—Continued Benefits (values in thousands of Waterbody type Facility 2001$) Impingement Entrainment Great Lake ...... All 16 In Scope ...... 25,205 25,092 Ocean ...... All 22 In Scope ...... 7,503 122,098 ALL ...... All 539 In Scope ...... 70,329 632,426 Under today’s proposal, facilities can that this proposed rule is a ‘‘significant three-year period as existing facilities choose the Site-Specific Determination regulatory action.’’ As such, this action continue to be issued permit renewals of Best Technology Available in was submitted to OMB for review. and such requirements will be counted § 125.94(a) in which a facility can Changes made in response to OMB in a subsequent information collection demonstrate to the Director that the cost suggestions or recommendations will be request. EPA does not consider the of compliance with the applicable documented in the public record. specific data that would be collected performance standards in § 125.94(b) B. Paperwork Reduction Act under this proposed rule to be would be significantly greater than the confidential business information. costs considered by EPA when The information collection However, if a respondent does consider establishing these performance requirements in this proposed rule have this information to be confidential, the standards, or the costs would be been submitted for approval to the respondent may request that such significantly greater than the benefits of Office of Management and Budget information be treated as confidential. complying with these performance (OMB) under the Paperwork Reduction All confidential data will be handled in standards. EPA expects that if facilities Act, 44 U.S.C. 3501 et seq. EPA has accordance with 40 CFR 122.7, 40 CFR were to choose this approach, then the prepared an Information Collection part 2, and EPA’s Security Manual Part overall national benefits of this rule will Request (ICR) document (EPA ICR No. III, Chapter 9, dated August 9, 1976. decrease markedly. This is because 2060.01) and you may obtain a copy Burden is defined as the total time, under this approach facilities would from Susan Auby by mail at Collection effort, or financial resources expended choose the lowest cost technologies Strategies Division; U.S. Environmental by persons to generate, maintain, retain, possible and not necessarily the most Protection Agency (2822); 1200 or disclose or provide information to or effective technologies to reduce Pennsylvania Ave., NW.; Washington, for a Federal agency. This includes the impingement and entrainment at the DC 20007, by e-mail at time needed to review instructions; facility. [email protected], or by calling (202) 260–49011. You also can develop, acquire, install, and utilize X. Administrative Requirements download a copy off the Internet at technology and systems for the purposes of collecting, validating, and verifying A. E.O. 12866: Regulatory Planning and http://www.epa.gov/icr. The information Review collection requirements relate to information, processing and existing electric generation facilities maintaining information, and disclosing Under Executive Order 12866 (58 FR and providing information; adjust the 51735, October 4, 1993), the Agency with design intake flows of 50 million gallons per day or more collecting existing ways to comply with any must determine whether the regulatory previously applicable instructions and action is ‘‘significant’’ and therefore information for preparing comprehensive demonstration studies, requirements; train personnel to be able subject to OMB review and the to respond to a collection of requirements of the Executive Order. monitoring of impingement and entrainment, verifying compliance, and information; search data sources; The order defines a ‘‘significant complete and review the collection of regulatory action’’ as one that is likely preparing yearly reports. The total burden of the information information; and transmit or otherwise to result in a rule that may: disclose the information. • Have an annual effect on the collection requirements associated with economy of $100 million or more or today’s proposed rule is estimated at Compliance with the applicable adversely affect in a material way the 4,251,240 hours. The corresponding information collection requirements economy, a sector of the economy, estimates of cost other than labor (labor imposed under this proposed rule (see productivity, competition, jobs, the and non-labor costs are included in the §§ 122.21(r), 125.95, 125.96, 125.97, and environment, public health or safety, or total cost of the proposed rule discussed 125.98) is mandatory. Existing facilities State, local, or Tribal governments or in Section VIII of this preamble) is $191 would be required to perform several communities; million for 539 facilities and 44 States data-gathering activities as part of the • Create a serious inconsistency or and one Territory for the first three permit renewal application process. otherwise interfere with an action taken years after promulgation of the rule. Today’s proposed rule would require or planned by another agency; Non-labor costs include activities such several distinct types of information • Materially alter the budgetary as capital costs for remote monitoring collection as part of the NPDES renewal impact of entitlements, grants, user fees, devices, laboratory services, application. In general, the information or loan programs or the rights and photocopying, and the purchase of would be used to identify which of the obligations of recipients thereof; or supplies. The burden and costs are for requirements in today’s proposed rule • Raise novel legal or policy issues the information collection, reporting, apply to the existing facility, how the arising out of legal mandates, the and recordkeeping requirements for the existing facility would meet those President’s priorities, or the principles three-year period beginning with the requirements, and whether the existing set forth in the Executive Order. assumed effective date of today’s rule. facility’s cooling water intake structure Pursuant to the terms of Executive Additional information collection reflects the best technology available for Order 12866, it has been determined requirements will occur after this initial minimizing environmental impact. VerDate 11 Categories of data required by today’s ambient water quality monitoring may Some of the facilities (those choosing proposed rule follow. also be required of facilities depending to use restoration measures to maintain • Source waterbody data for on the specifications of their permits. fish and shellfish) would need to determining appropriate requirements The facility would be expected to prepare a plan documenting the to apply to the facility, evaluating analyze the results from its monitoring restoration measures they would ambient conditions, and characterizing efforts and provide these results in an implement and how they would potential for impingement and annual status report to the permitting demonstrate that the restoration entrainment of all life stages of fish and authority. Finally, facilities would be measures were effective. The burden shellfish by the cooling water intake required to maintain records of all estimates incorporate the cost of structure; submitted documents, supporting preparing calculations, drawings, and • Intake structure data, consisting of materials, and monitoring results for at other materials supporting the proposed intake structure design and a facility least three years. (Note that the Director restoration measures, as well as water balance diagram, to determine may require that records be kept for a performing monitoring to verify the appropriate requirements and longer period to coincide with the life effectiveness of the restoration characterize potential for impingement of the NPDES permit.) and entrainment of all life stages of fish All impacted facilities would carry measures. and shellfish; out the specific activities necessary to Some facilities may choose to request • Information on design and fulfill the general information collection a site-specific determination of BTA construction technologies implemented requirements. The estimated burden because of costs significantly greater to ensure compliance with applicable includes developing a water balance than those EPA considered in requirements set forth in today’s diagram that can be used to identify the establishing the performance standards proposed rule; and proportion of intake water used for or because costs are significantly greater • Information on supplemental cooling, make-up, and process water. than the benefits of complying with the restoration measures proposed for use Facilities would also gather data to performance standards. These facilities with or in lieu of design and calculate the reduction in impingement must perform a comprehensive cost construction technologies to minimize mortality and entrainment of all life evaluation study and/or a valuation of adverse. stages of fish and shellfish that would the monetized benefits of reducing In addition to the information be achieved by the technologies and impingement and entrainment, as well requirements of the permit renewal operational measures they select. The as submitting a site-specific technology application, NPDES permits normally burden estimates include sampling, plan characterizing the design and specify monitoring and reporting assessing the source waterbody, construction technologies, operational requirements to be met by the permitted estimating the magnitude of measures and restoration measures they entity. Existing facilities that fall within impingement mortality and have selected. the scope of this proposed rule would entrainment, and reporting results in a be required to perform biological comprehensive demonstration study. Exhibit 35 presents a summary of the monitoring as required by the Director The burden also includes conducting a maximum burden estimates for a facility to demonstrate compliance, and visual pilot study to evaluate the suitability of to prepare a permit application and or remote inspections of the cooling the technologies and operational monitor and report on cooling water water intake structure and any measures based on the species that are intake structure operations as required additional technologies. Additional found at the site. by this rule. EXHIBIT 35.—MAXIMUM BURDEN AND COSTS PER FACILITY FOR NPDES PERMIT APPLICATION AND MONITORING AND REPORTING ACTIVITIES Other direct Activities Burden (hr) Labor cost costs (lump sum) a Start-up activities ...... 43 $1,964 $50 Permit application activities ...... 242 9,071 500 Source water baseline biological characterization data ...... 265 10,622 750 Proposal for collection of information for comprehensive demonstration study b ...... 271 11,407 1,000 Source waterbody flow information ...... 116 3,794 100 Design and construction technology plan ...... 146 5,260 50 Impingement mortality and entrainment characterization studyb ...... 5,264 289,061 13,000 Evaluation of potential cooling water intake structure effectsb ...... 2,578 144,838 500 Information for site-specific determination of BTA ...... 692 32,623 200 Site-specific technology plan ...... 177 6,963 75 Verification monitoring plan ...... 128 5,489 1,000 Subtotal ...... 9,922 521,092 17,225 Biological monitoring (impingement sampling) ...... 388 20,973 650 Biological monitoring (entrainment sampling) ...... 776 42,044 4,000 Visual or remote inspections c ...... 253 8,994 100 Verification study d ...... 122 5,927 500 Yearly status report activities ...... 324 14,906 750 Subtotal ...... 1,863 92,844 $6,000 a Cost of supplies, filing cabinets, photocopying, boat renting, etc. VerDate 11 b The Impingement Mortality and Entrainment Characterization Study and Evaluation of Potential CWIS Effects also have capital, O&M and contracted service costs associated with them. c Remote monitoring equipment also has capital and O&M costs associated with it. d The verification monitoring also has contracted services associated with it. EPA believes that all 44 States and materials, writing permits, and tracking qualifications necessary to complete one Territory with NPDES permitting compliance depends on the number of various tasks such as reviewing authority will undergo start-up activities new in-scope facilities that will be built submitted documents and supporting in preparation for administering the in the State/Territory during the ICR materials, verifying data sources, provisions of the proposed rule. As part approval period. EPA expects that State planning responses, determining of these start-up activities, States and and Territory technical and clerical staff specific permit requirements, writing Territories are expected to train junior will spend time gathering, preparing, the actual permit, and conferring with technical staff to review materials and submitting the various documents. facilities and the interested public. submitted by facilities, and then use EPA’s burden estimates reflect the Exhibit 36 provides a summary of the these materials to evaluate compliance general staffing and level of expertise maximum burden estimates for States/ with the specific conditions of each that is typical in States/Territories that Territories performing various activities facility’s NPDES permit. Each State’s/Territory’s actual burden administer the NPDES permitting with the proposed rule. associated with reviewing submitted program. EPA considered the time and EXHIBIT 36.—ESTIMATING STATE/TERRITORY MAXIMUM BURDEN AND COSTS FOR ACTIVITIES Other direct Activities Burden (hr) Labor cost costs (lump sum) a Start-up activities (per State/Territory) ...... 100 $3,496 $50 State/Territory permit issuance activities (per facility) ...... 811 32,456 300 Verification study review (per facility) ...... 21 689 50 Review of alternative regulatory requirements (per facility) ...... 192 6,237 50 Annual State/Territory activities (per facility) ...... 50 1,66250 Subtotal ...... 1,174 44,540 500 An Agency may not conduct or C. Unfunded Mandates Reform Act was not adopted. Before EPA establishes sponsor, and a person is not required to any regulatory requirements that may 1. UMRA Requirements respond to a collection of information, significantly or uniquely affect small unless it displays a currently valid OMB Title II of the Unfunded Mandates governments, including Tribal control number. The OMB control Reform Act of 1995 (UMRA), Pub. L. governments, it must have developed numbers for EPA’s regulations are listed 104–4, establishes requirements for under section 203 of UMRA a small in 40 CFR Part 9 and 48 CFR Chapter Federal agencies to assess the effects of government agency plan. The plan must 15. their regulatory actions on State, local, provide for notifying potentially and Tribal governments and the private affected small governments, enabling EPA requests comments on the sector. Under section 202 of UMRA, officials of affected small governments Agency’s need for this information, the EPA generally must prepare a written to have meaningful and timely input in accuracy of the provided burden statement, including a cost-benefit the development of EPA regulatory estimates, and any suggested methods analysis, for proposed and final rules proposals with significant for minimizing respondent burden, with ‘‘Federal mandates’’ that may intergovernmental mandates, and including through the use of automated result in expenditures to State, local, informing, educating, and advising collection techniques. Send comments and Tribal governments, in the small governments on compliance with on the ICR to the Director, Collection aggregate, or to the private sector, of regulatory requirements. Strategies Division; U.S. Environmental $100 million or more in any one year. EPA estimated total annualized (post- Protection Agency (2822); 1200 Before promulgating an EPA rule for tax) costs of compliance for the Pennsylvania Ave., NW. Washington, which a written statement is needed, proposed rule to be $182 million DC 20460; and to the Office of section 205 of UMRA generally requires ($2001). Of this total, $153 million is Information and Regulatory Affairs; EPA to identify and consider a incurred by the private sector and $19.6 Office of Management and Budget; 725 reasonable number of regulatory million is incurred by State and local 17th Street, NW.; Washington, DC alternatives and adopt the least costly, governments that operate in-scope 20503, marked ‘‘Attention: Desk Officer most cost-effective, or least burdensome facilities.82 Permitting authorities incur for EPA.’’ Include the ICR number in alternative that achieves the objectives an additional $3.6 million to administer any correspondence. Because OMB is of the rule. The provisions of section the rule, including labor costs to write required to make a decision concerning 205 do not apply when they are permits and to conduct compliance the ICR between 30 and 60 days after inconsistent with applicable law. monitoring and enforcement activities. April 9, 2002, a comment is best assured Moreover, section 205 allows EPA to EPA estimates that the highest of having its full effect if OMB receives adopt an alternative other than the least it by May 9, 2002. The final rule will costly, most cost-effective, or least 82 In addition, 13 facilities owned by Tennessee respond to any OMB or public burdensome alternative if the Valley Authority (TVA), a federal entity, incur $9.8 million in compliance costs. The costs incurred by comments on the information collection Administrator publishes with the final the federal government are not included in this requirements contained in this proposal. rule an explanation why that alternative section. VerDate 11 undiscounted cost incurred by the 2. Analysis of Impacts on Government proposed rule, by ownership type and private sector in any one year is Entities size of government entity. The exhibit approximately $480 million in 2005. Governments may incur two types of shows that 23 large government entities The highest undiscounted cost incurred costs as a result of the proposed operate 43 facilities subject to the by government sector in any one year is regulation: (1) Direct costs to comply proposed regulation. There are 22 small approximately $42 million in 2005. with the rule for facilities owned by government entities that operate 22 Thus, EPA has determined that this rule government entities; and (2) facilities subject to regulation. No small contains a Federal mandate that may administrative costs to implement the government entity operates more than result in expenditures of $100 million or regulation. Both types of costs are one affected facility. Of the 65 facilities more for State, local, and Tribal discussed below. that are owned by government entities, governments, in the aggregate, or the a. Compliance Costs for Government- 48 are owned by municipalities, eight private sector in any one year. Owned Facilities are owned by political subdivisions, Accordingly, EPA has prepared a seven are owned by state governments, Exhibit 37 below provides an estimate written statement under § 202 of UMRA, and two are owned by municipal of the number of government entities which is summarized below. marketing authorities. that operate facilities subject to the EXHIBIT 37.—NUMBER OF GOVERNMENT ENTITIES AND GOVERNMENT-OWNED FACILITIES Number of government entities Number of facilities Ownership type (by size) (by government entity size) Large Small Total Large Small Total Municipality ...... 16 19 35 29 19 48 Municipal marketing authority ...... 0 2 2 0 2 2 State Government ...... 4 0 4 7 0 7 Political Subdivision ...... 3 1 4 7 1 8 Total ...... 23 22 45 43 22 65 Exhibit 38 summarizes the annualized than 50,000). The total compliance cost Exhibit 39 below presents the compliance costs incurred by State, for all the small government-owned annualized costs of the major local, and Tribal governments for the facilities incurring costs under the administrative activities. proposed rule. The exhibit shows that proposed rule is $6.0 million, or the estimated annualized compliance approximately $273,000 per facility. EXHIBIT 39.—ANNUALIZED GOVERN- costs for all government-owned facilities The highest annualized compliance MENT ADMINISTRATIVE COSTS (MIL- are $19.6 million. The 43 facilities costs for a government-owned facility is LION $2001) owned by large governments would $965,000. In comparison, all non- incur costs of $13.6 million; the 22 government-owned facilities subject to Activity Cost facilities owned by small governments this rule are expected to incur would incur costs of $6 million. annualized compliance costs of $176 Start-up Activities ...... $0.02 million, or $330,000 per facility. The First Permit Issuance Activities 1.61 EXHIBIT 38.—NUMBER OF REGULATED highest annualized cost for a facility not Repermitting Activities ...... 1.05 Annual Activities ...... 0.94 GOVERNMENT-OWNED FACILITIES owned by a small government is $4.3 AND COMPLIANCE COSTS BY SIZE OF million. EPA therefore concludes that Total ...... 3.62 these costs do not significantly or GOVERNMENT FOR PROPOSED RULE uniquely affect small governments. The 3. Consultation Number of Compliance Economic and Benefits Assessment Size of Govern- facilities costs provides more detail on EPA’s analysis EPA consulted with State ment subject to (million of impacts on governments. governments and representatives of regulation $2001) local governments in developing the b. Administrative Costs regulation. The outreach activities are Facilities Owned The requirements of Section 316(b) discussed in Section XI.E (E.O. 13131 by Large Gov- are implemented through the NPDES ernments ...... 43 $13.6 addressing Federalism) of this preamble. (National Pollutant Discharge Facilities Owned 4. Alternatives Considered by Small Gov- Elimination System) permit program. ernments ...... 22 6.0 Forty-five states and territories currently In addition to the proposed rule, EPA All Government- have NPDES permitting authority under considered and analyzed several Owned Facili- section 402(b) of the Clean Water Act alternative regulatory options to ties ...... 65 19.6 (CWA). EPA estimates that states and determine the best technology available territories will incur four types of costs for minimizing adverse environmental EPA’s analysis also considered associated with implementing the impact. EPA selected the proposed rule whether the proposed rule may requirements of the proposed rule: (1) because it meets the requirement of significantly or uniquely affect small Start-up activities; (2) first permit section 316(b) of the CWA that the governments. EPA estimates that 22 issuance activities; (3) repermitting location, design, construction, and facilities subject to the proposed rule are activities, and (4) annual activities. EPA capacity of CWIS reflect the BTA for owned by small governments (i.e., estimates that the total annualized cost minimizing AEI, and it is economically governments with a population of less for these activities will be $3.6 million. practicable. VerDate 11 D. Regulatory Flexibility Act as After considering the economic population of less than 50,000; and (3) Amended by SBREFA (1996) impacts of today’s proposed rule on a small organization that is a not-for- small entities, the Agency certifies that profit enterprise which is independently The RFA generally requires an agency this action will not have a significant owned and operated and is not to prepare a regulatory flexibility economic impact on a substantial dominant in its field. The SBA analysis of any rule subject to notice number of small entities for reasons thresholds define minimum and comment rulemaking requirements explained below. employment, sales revenue, or MWh under the Administrative Procedure Act For the purposes of assessing the output sizes below which an entity or any other statute unless the agency impacts of today’s rule on small entities, qualifies as small. The thresholds used certifies that the rule will not have a small entity is defined as: (1) A small in this analysis are firm-level four-digit significant economic impact on a business according to Small Business substantial number of small entities. Administration (SBA) size standards; (2) Standard Industrial Classification (SIC) 83 Small entities include small businesses, a small governmental jurisdiction that is codes. Exhibit 40 below presents the small organizations, and small a government of a city, county; town, SBA size standards used in this governmental jurisdictions. school district or special district with a analysis. EXHIBIT 40.—UNIQUE PHASE II ENTITY SMALL BUSINESS SIZE STANDARDS (BY STANDARD INDUSTRY CLASSIFICATION CODES (SIC)) 84 SIC code SIC description SBA size standard 1311 ...... Crude Petroleum and Natural Gas ...... 500 Employees 3312 ...... Steel Works, Blast Furnaces (Including Coke Ovens), and Rolling 1,000 Employees. Mills. 4911 ...... Electric Services ...... 4 million MWh. 4924 ...... Natural Gas Distribution ...... 500 Employees. 4931 ...... Electric and Other Services Combined ...... $5.0 Million. 4932 ...... Gas and Other Services Combined ...... $5.0 Million. 4939 ...... Combination Utilities, NEC ...... $5.0 Million. 4953 ...... Refuse Systems ...... $10.0 Million. 6512 ...... Operators of Nonresidential Buildings ...... $5.0 Million. 8711 ...... Engineering Services ...... $6.0 Million. 84 Information Source: U.S. Small Business Administration, Office of Size Standards, Exhibit of Size Standards (www.sba.gov/regulations/ siccodes/siccodes.html) EPA used publicly available data from by small entities in the electric power revenues; and the remaining 17 small the 1999 Forms EIA–860A and EIA– industry. EPA has estimated that 28 in- entities would incur compliance costs of 860B as well as information from EPA’s scope electric generators owned by less than one percent of revenues. The 2000 Section 316(b) Industry Survey to small entities would be regulated by this estimated compliance costs that identify the parent entities of electric proposed rule. Of the 28 generators, 19 facilities owned by small entities would generators subject to this proposed rule. are projected to be owned by a likely incur represent between 0.12 and EPA also conducted research to identify municipality, six by a rural electric 5.29 percent of the entities’ annual sales recent changes in ownership, including cooperative, two by a municipal revenue. the current owner of each generator, and marketing authority, and one by a each owner’s primary SIC code, sales political subdivision. Exhibit 41 summarizes the results of revenues, employment, and/or Only facilities with design intake Regulatory Flexibility Act analysis. electricity sales. Based on the parent flows of 50 MGD or more are subject to From the small absolute number of entity’s SIC code and the related size this rule. In addition, only a small facilities owned by small entities that standard set by the SBA, EPA identified percentage of all small entities in the would be affected by the proposed rule, facilities that are owned by small electric power industry, 1.3 percent, is the low percentage of all small entities, entities. subject to this rule. Finally, of the 28 and the very low impacts, EPA Based on this analysis, EPA expects small entities, two entities would incur concludes that the proposed rule will this proposed rule to regulate only a annualized post-tax compliance costs of not have a significant economic impact small absolute number of facilities greater than three percent of revenues; on a substantial number of small owned by small entities, representing nine would incur compliance costs of entities. only 1.3 percent of all facilities owned between one and three percent of EXHIBIT 41.—SUMMARY OF RFA ANALYSIS (A) (B) Number of Number of (C) (D) (E) in-scope small Total Percent of Annual Type of Entity facilities entities number of small compliance owned by with small entities costs/annual small in-scope entities in-scope of sales entities facilities rule [(B)/(C)] revenue Municipality ...... 19 19 1,110 1.7 0.4 to 5.3% 83 The North American Industry Classification Classification (SIC) System as of October 1, 2000. entities of the facilities subject to this rule did not System (NAICS) replaced trhe Standard Industrial The data sources EPA used to identify the parent provide NAICS codes at the time of analysis. VerDate 11 EXHIBIT 41.—SUMMARY OF RFA ANALYSIS—Continued (A) (B) Number of Number of (C) (D) (E) in-scope small Total Percent of Annual Type of Entity facilities entities number of small compliance owned by with small entities costs/annual small in-scope entities in-scope of sales entities facilities rule [(B)/(C)] revenue Municipal Marketing Authority ...... 2 2 22 9.1 0.1 to 0.1% Rural Electric Cooperative ...... 6 6 877 0.7 0.2 to 0.5% Political Subdivision ...... 1 1 104 1.0 1.2 to 1.2% Other Types ...... 0 0 97 0.0 n/a Total ...... 28 28 2,210 1.3 0.1–5.3% The Economic and Benefits Analysis scope facilities have poverty levels and (1) is determined to be ‘‘economically for the Proposed Section 316(b) Phase II racial compositions that are quite significant’’ as defined under Executive Existing Facilities Rule presents more similar to the U.S. population as a Order 12866, and (2) concerns an detail on EPA’s small entity analysis in whole. A relatively small subset of the environmental health or safety risk that support of this proposed rule. facilities are located near populations EPA has reason to believe might have a with poverty rates (24 of 539, or 4.5%), disproportionate effect on children. If E. E.O. 12898: Federal Actions To or non-white populations (101 of 539, or the regulatory action meets both criteria, Address Environmental Justice in 18.7%), or both (13 of 539, or 2.4%), the Agency must evaluate the Minority Populations and Low-Income that are significantly higher than environmental health and safety effects Populations national levels. Based on these results, of the planned rule on children, and Executive Order 12898 requires that, EPA does not believe that this rule will explain why the planned regulation is to the greatest extent practicable and have an exclusionary effect, deny preferable to other potentially effective permitted by law, each Federal agency persons the benefits of the NPDES and reasonably feasible alternatives must make achieving environmental program, or subject persons to considered by the Agency. This justice part of its mission. E.O. 12898 discrimination because of their race, proposed rule is an economically provides that each Federal agency must color, or national origin. significant rule as defined under conduct its programs, policies, and In fact because EPA expects that this Executive Order 12866. However, it activities that substantially affect human final rule would help to preserve the does not concern an environmental health or the environment in a manner health of aquatic ecosystems located in health or safety risk that would have a that ensures such programs, policies, reasonable proximity to Phase II existing disproportionate effect on children. and activities do not have the effect of facilities, it believes that all Therefore, it is not subject to Executive excluding persons (including populations, including minority and Order 13045. populations) from participation in, low-income populations, would benefit G. E.O. 13175: Consultation and denying persons (including from improved environmental Coordination With Indian Tribal populations) the benefits of, or conditions as a result of this rule. Under Governments subjecting persons (including current conditions, EPA estimates populations) to discrimination under approximately 2.2 billion fish Executive Order 13175, entitled such programs, policies, and activities (expressed as age 1 equivalents) of ‘‘Consultation and Coordination with because of their race, color, or national recreational and commercial species are Indian Tribal Governments’’ (65 FR origin. lost annually due to impingement and 67249, November 6, 2000), requires EPA Today’s final rule would require that entrainment at the 529 in scope Phase to develop an accountable process to the location, design, construction, and II existing facilities. Under the Agency’s ensure ‘‘meaningful and timely input by capacity of cooling water intake preferred option, over 1.2 billion tribal officials in the development of structures (CWIS) at Phase II existing individuals of these commercially and regulatory policies that have tribal facilities reflect the best technology recreationally sought fish species (age 1 implications.’’ ‘‘Policies that have tribal available for minimizing adverse equivalents) will now survive to join the implications’’ is defined in the environmental impact. For several fishery each year (435 million fish due Executive Order to include regulations reasons, EPA does not expect that this to reduced impingement impacts, and that have ‘‘substantial direct effects on final rule would have an exclusionary 789 million fish due to reduced one or more Indian Tribes, on the effect, deny persons the benefits of the entrainment). These additional 1.2 relationship between the Federal participating in a program, or subject billion fish will provide increased government and the Indian Tribes, or on persons to discrimination because of opportunities for subsistence anglers to the distribution of power and their race, color, or national origin. increase their catch, thereby providing responsibilities between the Federal To assess the impact of the rule on some benefit to low income households government and Indian Tribes.’’ low-income and minority populations, located near regulation-impacted This proposed rule does not have EPA calculated the poverty rate and the waters. tribal implications. It will not have percentage of the population classified substantial direct effects on tribal as non-white for populations living F. E.O. 13045: Protection of Children governments, on the relationship within a 50-mile radius of each of the From Environmental Health Risks and between the Federal government and 539 in-scope facilities. The results of the Safety Risks Indian Tribes, or on the distribution of analysis, presented in the EBA, show Executive Order 13045 (62 FR 19885, power and responsibilities between the that the populations affected by the in- April 23, 1997) applies to any rule that Federal government and Indian Tribes, VerDate 11 as specified in Executive Order 13175. Order 13211, ‘‘significant energy action’’ the alternative regulatory options EPA’s analyses show that no facility means (66 FR 28355; May 22, 2001): considered by EPA, see Section VIII subject to this proposed rule is owned any action by an agency (normally published above or the Economic and Benefits by tribal governments. This proposed in the Federal Register) that promulgates or Analysis for the Proposed Section 316(b) rule does not affect Tribes in any way is expected to lead to the promulgation of a Phase II Existing Facilities Rule. in the foreseeable future. Accordingly, final rule or regulation, including notices of inquiry, advance notices of proposed J. National Technology Transfer and the requirements of Executive Order Advancement Act 13175 do not apply to this rule. rulemaking, and notices of proposed rulemaking: Section 12(d) of the National H. E.O. 13158: Marine Protected Areas (1)(i) That is a significant regulatory action Technology Transfer and Advancement under Executive Order 12866 or any Act (NTTAA) of 1995, Pub. L. 104–113, Executive Order 13158 (65 FR 34909, successor order, and May 31, 2000) requires EPA to (ii) Is likely to have a significant adverse Sec. 12(d) directs EPA to use voluntary ‘‘expeditiously propose new science- effect on the supply, distribution, or use of consensus standards in its regulatory based regulations, as necessary, to energy; or activities unless to do so would be ensure appropriate levels of protection (2) That is designated by the Administrator inconsistent with applicable law or for the marine environment.’’ EPA may of the Office of Information and Regulatory otherwise impractical. Voluntary Affairs as a significant energy action. take action to enhance or expand consensus standards are technical protection of existing marine protected For those regulatory actions identified standards (e.g., materials specifications, areas and to establish or recommend, as as ‘‘significant energy actions,’’ a test methods, sampling procedures, and appropriate, new marine protected Statement of Energy Effects must business practices) that are developed or areas. The purpose of the Executive include a detailed statement relating to adopted by voluntary consensus Order is to protect the significant (1) any adverse effects on energy supply, standard bodies. The NTTAA directs natural and cultural resources within distribution, or use (including a EPA to provide Congress, through the the marine environment, which means shortfall in supply, price increases, and Office of Management and Budget ‘‘those areas of coastal and ocean increased use of foreign supplies), and (OMB), explanations when the Agency waters, the Great Lakes and their (2) reasonable alternatives to the action decides not to use available and connecting waters, and submerged lands with adverse energy effects and the applicable voluntary consensus thereunder, over which the United expected effects of such alternatives on standards. States exercises jurisdiction, consistent energy supply, distribution, and use. This proposed rule does not involve with international law.’’ This proposed rule does not qualify as such technical standards. Therefore, a ‘‘significant energy action’’ as defined EPA is not considering the use of any This proposed rule recognizes the in Executive Order 13211 because it is voluntary consensus standards. EPA biological sensitivity of tidal rivers, not likely to have a significant adverse welcomes comments on this aspect of estuaries, oceans, and the Great Lakes effect on the supply, distribution, or use the proposed rule and, specifically, and their susceptibility to adverse of energy. The proposed rule does not invites the public to identify potentially environmental impact from cooling contain any compliance requirements applicable voluntary consensus water intake structures. This proposal that would directly reduce the installed standards and to explain why such provides the most stringent capacity or the electricity production of standards should be used in this requirements to minimize adverse U.S. electric power generators, for proposed rule. environmental impact for cooling water example through parasitic losses or intake structures located on these types auxiliary power requirements. In K. Plain Language Directive of water bodies, including potential addition, based on the estimated costs of Executive Order 12866 and the reduction of intake flows to a level compliance, EPA currently projects that President’s memorandum of June 1, commensurate with that which can be the rule will not lead to any early 1998, require each agency to write all attained by a closed-cycle recirculating capacity retirements at facilities subject rules in plain language. We invite your cooling system for facilities that to this rule or at facilities that compete comments on how to make this withdraw certain proportions of water with them. As described in detail in proposed rule easier to understand. For from estuaries, tidal rivers, and oceans. Section VIII, EPA estimates small effects example: Have we organized the EPA expects that this proposed rule of this rule on installed capacity, material to suit your needs? Are the will reduce impingement and generation, production costs, and requirements in the rule clearly stated? entrainment at facilities with design electricity prices. EPA’s therefore Does the rule contain technical language intake flows of 50 MGD or more. The concludes that this proposed rule will or jargon that is not clear? Would a rule would afford protection of aquatic have small energy effects at a national, different format (grouping and order of organisms at individual, population, regional, and facility-level. As a result, sections, use of headings, paragraphing) community, or ecosystem levels of EPA did not prepare a Statement of make the rule easier to understand? ecological structures. Therefore, EPA Energy Effects. EPA recognizes that Would more (but shorter) sections be expects today’s proposed rule would some of the alternative regulatory better? Could we improve clarity by advance the objective of the Executive options discussed in the preamble adding tables, lists, or diagrams? What Order to protect marine areas. would have much larger effects and else could we do to make the rule easier I. E.O. 13211: Energy Effects might well quality as ‘‘significant energy to understand? actions’’ under Executive Order 13211. Executive Order 13211 on ‘‘Actions If EPA decides to revise the proposed L. Executive Order 13132: Federalism Concerning Regulations That requirements for the final rule, it will Executive Order 13132 (64 FR 43255, Significantly Affect Energy Supply, reconsider its determination under August 10, 1999) requires EPA to Distribution, or Use’’ requires EPA to Executive Order 13211 and prepare a develop an accountable process to prepare a Statement of Energy Effects Statement of Energy Effects as ensure ‘‘meaningful and timely input by when undertaking regulatory actions appropriate. State and local officials in the identified as ‘‘significant energy For more detail on the potential development of regulatory policies that actions.’’ For the purposes of Executive energy effects of this proposed rule or have federalism implications. Policies VerDate 11 that have federalism implications’’ are as stringent as Federal program occasions with representatives of defined in the Executive Order to requirements. States retain the ability to environmental groups. include regulations that have implement requirements that are In the months leading up to ‘‘substantial direct effects on the States, broader in scope or more stringent than publication of the proposed Phase I rule, on the relationship between the national Federal requirements. (See section 510 EPA conducted a series of stakeholder government and the States, or on the of the CWA.) meetings to review the draft regulatory distribution of power and Today’s proposed rule would not framework for the proposed rule and responsibilities among the various have substantial direct effects on either invited stakeholders to provide their levels of government.’’ authorized or nonauthorized States or recommendations for the Agency’s Under section 6 of Executive Order on local governments because it would consideration. EPA managers have met 13132, EPA may not issue a regulation not change how EPA and the States and with the Utility Water Act Group, that has federalism implications, that local governments interact or their Edison Electric Institute, representatives imposes substantial direct compliance respective authority or responsibilities from an individual utility, and with costs, and that is not required by statute for implementing the NPDES program. representatives from the petroleum unless the Federal government provides Today’s proposed rule establishes refining, pulp and paper, and iron and the funds necessary to pay the direct national requirements for Phase II steel industries. EPA conducted compliance costs incurred by State and existing facilities with cooling water meetings with environmental groups local governments or EPA consults with intake structures. NPDES-authorized attended by representatives from State and local officials early in the States that currently do not comply with between 3 and 15 organizations. EPA process of developing the proposed the final regulations based on today’s also met with the Association of State regulation. EPA also may not issue a proposal might need to amend their and Interstate Water Pollution Control regulation that has federalism regulations or statutes to ensure that Administrators (ASIWPCA) and, with implications and that preempts State their NPDES programs are consistent the assistance of ASIWPCA, conducted law, unless the Agency consults with with Federal section 316(b) a conference call in which State and local officials early in the requirements. See 40 CFR 123.62(e). For representatives from 17 states or process of developing the proposed purposes of this proposed rule, the interstate organizations participated. regulation. relationship and distribution of power EPA also met with OMB and utility This proposed rule does not have and responsibilities between the Federal representatives and other federal federalism implications. It will not have government and the States and local agencies (the Department of Energy, the substantial direct effects on the States, governments are established under the Small Business Administration, the on the relationship between the national CWA (e.g., sections 402(b) and 510); Tennessee Valley Authority, the government and the States, or on the nothing in this proposed rule would National Oceanic and Atmospheric distribution of power and alter that. Thus, the requirements of Administration’s National Marine responsibilities among the various section 6 of the Executive Order do not Fisheries Service and the Department of levels of government, as specified in apply to this rule. Interior’s U.S. Fish and Wildlife Executive Order 13132. Rather, this Although section 6 of Executive Order Service). After publication of the proposed rule would result in minimal 13132 does not apply to this rule, EPA administrative costs on States that have did consult with State governments and proposed Phase I rule, EPA continued to an authorized NPDES program. EPA representatives of local governments in meet with stakeholders at their request. expects an annual burden of 146,983 developing the proposed rule. During EPA received more than 2000 hours with an annual cost of $41,200 the development of the proposed comments on the Phase I proposed rule (non-labor costs) for States to section 316(b) rule for new facilities, and NODA. In some cases these collectively administer this proposed EPA conducted several outreach comments have informed the rule. EPA has identified 65 Phase II activities through which State and local development of the Phase II rule existing facilities that are owned by officials were informed about this proposal. federal, state or local government proposal and they provided information In January, 2001, EPA also attended entities. The annual impacts on these and comments to the Agency. The technical workshops organized by the facilities is not expected to exceed 2,252 outreach activities were intended to Electric Power Research Institute and burden hours and $56,739 (non-labor provide EPA with feedback on issues the Utilities Water Action Group. These costs) per facility. such as adverse environmental impact, workshops focused on the presentation The proposed national cooling water BTA, and the potential cost associated of key issues associated with different intake structure requirements would be with various regulatory alternatives. regulatory approaches considered under implemented through permits issued EPA has made presentations on the the Phase I proposed rule and under the NPDES program. Forty-three section 316(b) rulemaking effort in alternatives for addressing 316(b) States and the Virgin Islands are general at eleven professional and requirements. currently authorized pursuant to section industry association meetings. EPA also On May 23, 2001, EPA held a day- 402(b) of the CWA to implement the conducted two public meetings in June long forum to discuss specific issues NPDES program. In States not and September of 1998 to discuss issues associated with the development of authorized to implement the NPDES related to the section 316(b) rulemaking regulations under section 316(b). At the program, EPA issues NPDES permits. effort. In September 1998 and April meeting, 17 experts from industry, Under the CWA, States are not required 1999, EPA staff participated in technical public interest groups, States, and to become authorized to administer the workshops sponsored by the Electric academia reviewed and discussed the NPDES program. Rather, such Power Research Institute on issues Agency’s preliminary data on cooling authorization is available to States if relating to the definition and assessment water intake structure technologies that they operate their programs in a manner of adverse environmental impact. EPA are in place at existing facilities and the consistent with section 402(b) and staff have participated in other industry costs associated with the use of applicable regulations. Generally, these conferences, met upon request on available technologies for reducing provisions require that State NPDES numerous occasions with industry impingement and entrainment. Over programs include requirements that are representatives, and met on a number of 120 people attended the meeting. VerDate 11 Finally, in August 21, 2001, EPA staff issues relating to the definition and and State and local governments, EPA participated in a technical symposium assessment of adverse environmental specifically solicits comment on this sponsored by the Electric Power impact for section 316(b) of the CWA. proposed rule from State and local Research Institute in association with In the spirit of this Executive Order officials. the American Fisheries Society on and consistent with EPA policy to BILLING CODE 6560–50–P promote communications between EPA VerDate 11 BILLING CODE 6560–50–C VerDate 11 List of Subjects 40 CFR Part 124 PART 9—OMB APPROVALS UNDER THE PAPERWORK REDUCTION ACT 40 CFR Part 9 Administrative practice and procedure, Air pollution control, 1. The authority citation for part 9 Reporting and recordkeeping Hazardous waste, Indians-lands, continues to read as follows: requirements. Reporting and recordkeeping Authority: 7 U.S.C. 135 et seq., 136–136y; 40 CFR Part 122 requirements, Water pollution control, 15 U.S.C. 2001, 2003, 2005, 2006, 2601–2671, Water supply. 21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33 Administrative practice and U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318, procedure, Confidential business 40 CFR Part 125 1321, 1326, 1330, 1342, 1344, 1345 (d) and information, Hazardous substances, (e), 1361; E.O. 11735, 38 FR 21243, 3 CFR, Cooling Water Intake Structure, Reporting and recordkeeping 1971–1975 Comp. p. 973; 42 U.S.C. 241, Reporting and recordkeeping 242b, 243, 246, 300f, 300g, 300g–1, 300g–2, requirements, Water pollution control. requirements, Waste treatment and 300g–3, 300g–4, 300g–5, 300g–6, 300j–1, 40 CFR Part 123 disposal, Water pollution control. 300j–2, 300j–3, 300j–4, 300j–9, 1857 et seq., 6901–6992k, 7401–7671q, 7542, 9601–9657, Administrative practice and Dated: February 28, 2002. 11023, 11048. procedure, Confidential business Christine Todd Whitman, 2. In § 9.1 the table is amended by information, Hazardous substances, Administrator. revising the entry for ‘‘122.21(r)’’ and by Indian-lands, Intergovernmental For the reasons set forth in the adding entries in numerical order under relations, Penalties, Reporting and preamble, chapter I of title 40 of the the indicated heading to read as follows: recordkeeping requirements, Water Code of Federal Regulations is amended § 9.1 OMB approvals under the Paper pollution control. as follows: Work Reduction Act. * * * * * 40 CFR citation OMB control No. ******* EPA Administered Permit Programs: The National Pollutant Discharge Elimination System ******* 122.21(r) ...... 2040–0241, xxxxx–xxxxx ******* Criteria and Standards for the National Pollutant Discharge Elimination System ******* 125.95 ...... xxxx–xxxx 125.96 ...... xxxx–xxxx 125.97 ...... xxxx–xxxx 125.98 ...... xxxx–xxxx ******* PART 122—EPA ADMINISTERED structures as defined in part 125, (2) Source Water Physical Data PERMIT PROGRAMS: THE NATIONAL subpart I of this chapter must report the including: POLLUTANT DISCHARGE information required under paragraphs (i) A narrative description and scaled ELIMINATION SYSTEM (r)(2), (3), and (4) of this section and drawings showing the physical § 125.86 of this chapter. Requests for configuration of all source water bodies 1. The authority citation for part 122 alternative requirements under § 125.85 used by your facility, including areal continues to read as follows: of this chapter must be submitted with dimensions, depths, salinity and Authority: The Clean Water Act, 33 U.S.C. your permit application. temperature regimes, and other 1251 et seq. (ii) Phase II existing facilities. Phase II documentation that supports your 2. Section § 122.21 by revising existing facilities as defined in part 125, determination of the water body type paragraph (r) to read as follows: subpart J of this chapter must report the where each cooling water intake structure is located; information required under paragraphs § 122.21 Application for a permit (ii) Identification and characterization (applicable to State programs, see § 123.25) (r)(2), (3), and (5) of this section and § 125.95 of this chapter. Requests for of the source waterbody’s hydrological * * * * * site-specific determination of best and geomorphological features, as well (r) Applications for facilities with technology available for minimizing as the methods you used to conduct any cooling water intake structures—(1)(i) adverse environmental impact under physical studies to determine your New facilities with new or modified § 125.94(c) of this chapter must be intake’s area of influence within the cooling water intake structures. New waterbody and the results of such submitted with your permit application. facilities with cooling water intake studies; and VerDate 11 (iii) Locational maps. that might be susceptible to Authority: The Clean Water Act, 33 U.S.C. (3) Cooling Water Intake Structure impingement and entrainment at your 1251 et seq. Data including: cooling water intake structures; 2. Section 123.25 is amended by (i) A narrative description of the (vii) Documentation of any public revising paragraph (a)(4) (a) and (36) to configuration of each of your cooling participation or consultation with read as follows: water intake structures and where it is Federal or State agencies undertaken in located in the water body and in the development of the plan; and § 123.25 Requirements for permitting. water column; (viii) If you supplement the (a) * * * (ii) Latitude and longitude in degrees, information requested in paragraph (4) § 122.21 (a) (b), (c)(2), (e) (k), minutes, and seconds for each of your (r)(4)(i) of this section with data (m) (p), and (r)—(Application for a cooling water intake structures; collected using field studies, supporting permit); (iii) A narrative description of the documentation for the Source Water * * * * * operation of each of your cooling water Baseline Biological Characterization (36) Subparts A, B, D, H, I, and J of intake structures, including design must include a description of all part 125 of this chapter; intake flows, daily hours of operation, methods and quality assurance * * * * * number of days of the year in operation procedures for sampling, and data and seasonal changes, if applicable; analysis including a description of the PART 124—PROCEDURES FOR (iv) A flow distribution and water study area; taxonomic identification of DECISIONMAKING balance diagram that includes all sampled and evaluated biological sources of water to the facility, assemblages (including all life stages of 1. The authority citation for part 124 recirculating flows, and discharges; and fish and shellfish); and sampling and continues to read as follows: (v) Engineering drawings of the data analysis methods. Authority: Resource Conservation and cooling water intake structure. The sampling and/or data analysis Recovery Act, 42 U.S.C. 6901 et seq.; Safe (4) Source Water Baseline Biological methods you use must be appropriate Drinking Water Act, 42 U.S.C. 300f et.seq; Characterization Data. This information for a quantitative survey and based on Clean Water Act, 33 U.S.C. 1251 et seq.; is required to characterize the biological consideration of methods used in other Clean Air Act, 42 U.S.C. 7401 et seq. community in the vicinity of the cooling biological studies performed within the 2. Section 124.10 is amended by water intake structure and to same source water body. The study area revising paragraph (d)(1)(ix) to read as characterize the operation of the cooling should include, at a minimum, the area follows: water intake structures. The Director of influence of the cooling water intake may also use this information in structure. § 124.10 Public notice of permit actions subsequent permit renewal proceedings (5) Phase II Existing Facility Cooling and public comment period. to determine if your Design and Water System Data. Phase II existing * * * * * Construction Technology Plan as facilities, as defined in part 125, subpart (d) * * * required in § 125.86(b)(4) should be J of this chapter, must provide the (1) * * * revised. This supporting information following information: (ix) Requirements applicable to must include existing data (if they are (i) A narrative description of the cooling water intake structures under available). However, you may operation of each of your cooling water section 316(b) of the CWA, in supplement the data using newly systems, relationship to cooling water accordance with part 125, subparts I and conducted field studies if you choose to intake structures, proportion of the J of this chapter. do so. The information you submit must design intake flow that is used in the * * * * * include: system, number of days of the year in (i) A list of the data in paragraphs operation and seasonal changes, if PART 125—CRITERIA AND (r)(4)(ii) through (vi) of this section that applicable; STANDARDS FOR THE NATIONAL are not available and efforts made to (ii) Engineering calculations and POLLUTANT DISCHARGE identify sources of the data; supporting data to support the ELIMINATION SYSTEM (ii) A list of species (or relevant taxa) description required by paragraph 1. The authority citation for part 125 for all life stages and their relative (r)(5)(i) of this section. continues to read as follows: abundance in the vicinity of the cooling 3. Section 122.44 is amended by water intake structure; revising paragraph (b)(3) to read as Authority: Clean Water Act, 33 U.S.C. 1251 (iii) Identification of the species and follows: et seq.; unless otherwise noted. life stages that would be most 2. Section 125.83 is amended by susceptible to impingement and § 122.44 Establishing limitations, standards, and other permit conditions revising the definition of cooling water entrainment. Species evaluated should (applicable to State NPDES programs, see as follows: include the forage base as well as those § 123.25). most important in terms of significance § 125.83 What special definitions apply to * * * * * to commercial and recreational this subpart? (b) * * * * * * * * fisheries; (3) Requirements applicable to Cooling water means water used for (iv) Identification and evaluation of cooling water intake structures under contact or noncontact cooling, including the primary period of reproduction, section 316(b) of the CWA, in water used for equipment cooling, larval recruitment, and period of peak accordance with part 125, subparts I and evaporative cooling tower makeup, and abundance for relevant taxa; J of this chapter. (v) Data representative of the seasonal dilution of effluent heat content. The and daily activities (e.g., feeding and * * * * * intended use of the cooling water is to water column migration) of biological PART 123—STATE PROGRAM absorb waste heat rejected from the organisms in the vicinity of the cooling REQUIREMENTS process or processes used, or from water intake structure; auxiliary operations on the facility’s (vi) Identification of all threatened, 1. The authority citation for part 123 premises. Cooling water that is used in endangered, and other protected species continues to read as follows: a manufacturing process either before or VerDate 11 after it is used for cooling is considered shall require that the location, design, cooling water if the supplier or process water for the purposes of construction, and capacity of cooling suppliers withdraw(s) water from waters calculating the percentage of a new water intake structures reflect the best of the United States. Use of cooling facility’s intake flow that is used for technology available for minimizing water does not include obtaining cooling purposes in §§ 125.81(c) and adverse environmental impact. cooling water from a public water 125.91(c). (c) Existing facilities that are not system or use of treated effluent that * * * * * subject to this subpart must meet otherwise would be discharged to a 3. Add subpart J to part 125 to read requirements under section 316(b) of the water of the U.S. This provision is as follows: CWA determined by the Director on a intended to prevent circumvention of case-by-case, best professional judgment these requirements by creating Subpart J—Requirements Applicable to (BPJ) basis. Cooling Water Intake Structures for ‘‘Phase arrangements to receive cooling water II Existing Facilities’’ Under Section 316(b) (d) Notwithstanding any other from an entity that is not itself a point of the Act provision of this subpart, if a State source. demonstrates to the Administrator that (d) Whether or not 25 percent of water Sec. it has adopted alternative regulatory 125.90 What are the purpose and scope of withdrawn is used for cooling purposes this subpart? requirements that will result in must be measured on an average 125.91 What is a Phase II existing facility environmental performance within a monthly basis. The 25 percent threshold subject to this subpart? watershed that is comparable to the is met if any monthly average of cooling 125.92 When must I comply with this reductions of impingement mortality water over any 12 month period is 25 subpart? and entrainment that would otherwise percent or more of the total water 125.93 What special definitions apply to be achieved under § 125.94, the withdrawn. this subpart? Administrator shall approve such 125.94 How will requirements reflecting alternative regulatory requirements. § 125.92 When must I comply with this best technology available for minimizing (e) Nothing in this subpart shall be subpart? adverse environmental impact be construed to preclude or deny the right You must comply with this subpart established for my Phase II existing when an NPDES permit containing facility? of any State or political subdivision of 125.95 As an owner or operator of a Phase a State or any interstate agency under requirements consistent with this II existing facility, what must I collect section 510 of the CWA to adopt or subpart is issued to you. and submit when I apply for my reissued enforce any requirement with respect to § 125.93 What special definitions apply to NPDES permit? control or abatement of pollution that is this subpart? 125.96 As an owner or operator of a Phase not less stringent than those required by The definitions in Subpart I of Part II existing facility, what monitoring must Federal law. I perform? 125, except the definitions of cooling 125.97 As an owner or operator of a Phase § 125.91 What is a ‘‘Phase II Existing water and existing facility, apply to this II existing facility, what records must I Facility’’ subject to this subpart? subpart. The following definitions also keep and what information must I (a) This subpart applies to an existing apply to this subpart: report? facility, as defined in § 125.93, if it: Administrator means the same as 125.98 As the Director, what must I do to (1) Is a point source that uses or defined in 40 CFR 122.2. comply with the requirements of this All life stages means eggs, larvae, subpart? proposes to use a cooling water intake structure; juveniles, and adults. Subpart J—Requirements Applicable (2) Both generates and transmits Calculation baseline means an to Cooling Water Intake Structures for electric power, or generates electric estimate of impingement mortality and ‘‘Phase II Existing Facilities’’ Under power but sells it to another entity for entrainment that would occur at your Section 316(b) of the Act transmission; site assuming you had a shoreline (3) Has at least one cooling water cooling water intake structure with an § 125.90 What are the purpose and scope intake structure that uses at least 25 intake capacity commensurate with a of this subpart? percent of the water it withdraws for once-through cooling water system and (a) This subpart establishes cooling purposes as specified in with no impingement and/or requirements that apply to the location, paragraph (c) of this section; and entrainment reduction controls. design, construction, and capacity of (4) Has a design intake flow of 50 Capacity utilization rate means the cooling water intake structures at million gallons per day (MGD) or more. ratio between the average annual net existing facilities that are subject to this Facilities that meet these criteria are generation of the facility (in MWh) and subpart (Phase II existing facilities). The referred to as ‘‘Phase II existing the total net capability of the facility (in purpose of these requirements is to facilities.’’ MW) multiplied by the number of establish the best technology available (b) In the case of a cogeneration available hours during a year. The for minimizing adverse environmental facility that shares a cooling water average annual generation must be impact associated with the use of intake structure with another existing measured over a five year period (if cooling water intake structures. These facility, only that portion of the cooling available) of representative operating requirements are implemented through water intake flow that is used in the conditions. National Pollutant Discharge cogeneration process shall be Cogeneration facility means a facility Elimination System (NPDES) permits considered for purposes of determining that operates equipment used to issued under section 402 of the Clean whether the 50 MGD and 25 percent produce, from the same fuel source: Water Act (CWA). criteria in paragraphs (a)(3) and (4) of electric energy used for industrial, (b) This subpart implements section this section are met. commercial, and/or institutional 316(b) of the CWA for Phase II existing (c) Use of a cooling water intake purposes at one or more host facilities facilities. Section 316(b) of the CWA structure includes obtaining cooling and/or for sale to another entity for provides that any standard established water by any sort of contract or transmission; and forms of useful pursuant to sections 301 or 306 of the arrangement with an independent thermal energy (such as heat or steam), CWA and applicable to a point source supplier (or multiple suppliers) of used for industrial commercial, VerDate 11 institutional, heating, and/or cooling establishing best technology available (ii) If you propose to increase your purposes at one or more host facilities. for minimizing adverse environmental facility’s design intake flow, your Cooling water means water used for impact at your site: increased flow must not disrupt the contact or noncontact cooling, including (1) You may demonstrate to the natural thermal stratification or turnover water used for equipment cooling, Director that your existing design and pattern (where present) of the source evaporative cooling tower makeup, and construction technologies, operational water, except in cases where the dilution of effluent heat content. The measures, and/or restoration measures disruption is determined by any intended use of the cooling water is to meet the performance standards Federal, State or Tribal fish or wildlife absorb waste heat rejected from the specified in paragraph (b) of this management agency(ies) to be beneficial process or processes used, or from section; to the management of fisheries. auxiliary operations on the facility’s (2) You may demonstrate to the (c)(1) Site-Specific Determination of premises. Cooling water that is used in Director that you have selected design Best Technology Available. If you a manufacturing process either before or and construction technologies, choose the alternative in paragraph after it is used for cooling is considered operational measures, and/or restoration (a)(3) of this section, you must process water for the purposes of measures that will, in combination with demonstrate to the Director that your calculating the percentage of a facility’s any existing design and construction costs of compliance with the applicable intake flow that is used for cooling technologies, operational measures, performance standards in paragraph (b) purposes in § 125.91(c). and/or restoration measures, meet the of this section would be significantly Diel means sample variation in performance standards specified in greater than the costs considered by the organismal abundance and density over paragraph (b) of this section; or Administrator when establishing such a 24-hour period due to the influence of (3) You may demonstrate to the performance standards, or that your water movement and changes in light Director that a site-specific costs would be significantly greater than intensity. determination of best technology the benefits of complying with such Director means the same as defined in available for minimizing adverse performance standards at your site. 40 CFR 122.2. environmental impact is appropriate for (2) If data specific to your facility Existing facility means any facility your site in accordance with paragraph indicate that your costs would be that commenced construction before (c) of this section. significantly greater than those January 17, 2002; and (b) Performance Standards. If you considered by the Administrator in (1) Any modification of such a choose the alternative in paragraphs establishing the applicable performance facility; (a)(1) or (a)(2) of this section, you must standards, the Director shall make a site- (2) Any addition of a unit at such a meet the following performance specific determination of best facility for purposes of the same standards: technology available for minimizing (1) You must reduce your intake industrial operation; adverse environmental impact that is capacity to a level commensurate with (3) Any addition of a unit at such a based on less costly design and the use of a closed-cycle, recirculating facility for purposes of a different construction technologies, operational cooling system; or measures, and/or restoration measures industrial operation, if the additional (2) You must reduce impingement unit uses an existing cooling water to the extent justified by the mortality of all life stages of fish and significantly greater cost. The Director’s intake structure and the design capacity shellfish by of the intake structure is not increased; site-specific determination may 80 to 95 percent from the calculation or conclude that design and construction (4) Any facility constructed in place baseline if your facility has a capacity technologies, operational measures, utilization rate less than 15 percent, or of such a facility, if the newly and/or restoration measures in addition your facility’s design intake flow is 5 constructed facility uses an existing to those already in place are not percent or less of the mean annual flow cooling water intake structure whose justified because of significantly greater from a freshwater river or stream; or costs. design intake flow is not increased to (3) You must reduce impingement accommodate the intake of additional (3) If data specific to your facility mortality of all life stages of fish and indicate that your costs would be cooling water. shellfish by Once-through cooling water system significantly greater than the benefits of means a system designed to withdraw 80 to 95 percent from the calculation complying with such performance baseline, and you must reduce water from a natural or other water standards at your facility, the Director entrainment of all life stages of fish and shall make a site-specific determination source, use it at the facility to support shellfish by 60 to 90 percent from the of best technology available for contact and/or noncontact cooling uses, calculation baseline if your facility has minimizing adverse environmental and then discharge it to a water body a capacity utilization rate of 15 percent impact that is based on less costly without recirculation. Once-through or greater and withdraws cooling water design and construction technologies, cooling systems sometimes employ from a tidal river or estuary, from an operational measures, and/or restoration canals/channels, ponds, or non- ocean, from one of the Great Lakes, or measures to the extent justified by the recirculating cooling towers to dissipate your facility’s design intake flow is significantly greater costs. The waste heat from the water before it is greater than 5 percent of the mean Director’s site-specific determination discharged. annual flow of a freshwater river or Phase II existing facility means any may conclude that design and stream; or construction technologies, operational existing facility that meets the criteria (4) If your facility withdraws cooling specified in § 125.91. measures, and/or restoration measures water from a lake (other than one of the in addition to those already in place are § 125.94 How will requirements reflecting Great Lakes) or reservoir: not justified because the costs would be best technology available for minimizing (i) You must reduce impingement significantly greater than the benefits at adverse environmental impact be mortality of all life stages of fish and your facility. established for my Phase II existing facility? shellfish by (d) Restoration Measures. In lieu of, or (a) You may choose one of the 80 to 95 percent from the calculation in combination with, reducing following three alternatives for baseline; and impingement mortality and entrainment VerDate 11 by implementing design and 180 days before your existing permit taxonomic identification of the sampled construction technologies or operational expires, in accordance with or evaluated biological assemblages measures to comply with the § 122.21(d)(2). (including all life stages of fish and performance standards specified in (b) Comprehensive Demonstration shellfish). paragraph (b) of this section or the Study. All facilities except those (2) Source Waterbody Flow Director’s determination pursuant to deemed to have met the performance Information. You must submit to the paragraph (c) of this section, you may, standards in accordance with Director the following source waterbody with the Director’s approval, employ § 125.94(b)(1), must submit a flow information: restoration measures that will result in Comprehensive Demonstration Study (i) If your cooling water intake increases in fish and shellfish in the (Study). This information is required to structure is located in a freshwater river watershed. You must demonstrate to the characterize impingement mortality and or stream, you must provide the annual Director that you are maintaining the entrainment, the operation of your mean flow of the waterbody and any fish and shellfish within the waterbody, cooling water intake structures, and to supporting documentation and including community structure and confirm that the technology(ies), engineering calculations to support your function, to a level comparable to those operational measures, and/or restoration analysis of which requirements that would result if you were to employ measures you have selected and/or specified in § 125.94(b)(2) or (3) would design and construction technologies or implemented at your cooling water apply to your facility based on its water operational measures to meet that intake structure meet the applicable intake flow in proportion to the mean portion of the requirements of requirements of § 125.94. The annual flow of the river or steam; and paragraphs (b) or (c) of this section that Comprehensive Demonstration Study (ii) If your cooling water intake you are meeting through restoration. must include: structure is located in a lake (other than Your demonstration must address (1) Proposal For Information one of the Great Lakes) or reservoir and species that the Director, in consultation Collection. You must submit to the you propose to increase your facility’s with Federal, State, and Tribal fish and Director for review and approval a design intake flow, you must provide a narrative description of the thermal wildlife management agencies with description of the information you will stratification in the water body, and any responsibility for fisheries and wildlife use to support your Study. The proposal supporting documentation and potentially affected by your cooling must include: (i) A description of the proposed and/ engineering calculations to show that water intake structure, identifies as or implemented technology(ies), the natural thermal stratification and species of concern. (e) More Stringent Standards. The operational measures, and/or restoration turnover pattern will not be disrupted Director may establish more stringent measures to be evaluated in the Study; by the increased flow in a way that (ii) A list and description of any requirements as best technology adversely impacts water quality or historical studies characterizing available for minimizing adverse fisheries. impingement and entrainment and/or (3) Impingement Mortality and environmental impact if the Director the physical and biological conditions Entrainment Characterization Study. determines that your compliance with in the vicinity of the cooling water You must submit to the Director an the applicable requirements of intake structures and their relevance to Impingement Mortality and Entrainment paragraphs (b) and (c) of this section this proposed Study. If you propose to Characterization Study whose purpose would not meet the requirements of use existing data, you must demonstrate is to provide information to support the other applicable Federal, State, or Tribal the extent to which the data are development of a calculation baseline law. representative of current conditions and (f) If the Nuclear Regulatory for evaluating impingement mortality that the data were collected using Commission has determined that your and entrainment and to characterize appropriate quality assurance/quality compliance with this subpart would current impingement mortality and control procedures; result in a conflict with a safety entrainment. The Impingement (iii) A summary of any past, ongoing, Mortality and Entrainment requirement established by the or voluntary consultation with Commission, the Director shall make a Characterization Study must include: appropriate Federal, State, and Tribal (i) Taxonomic identifications of those site-specific determination of best fish and wildlife agencies that is species of fish and shellfish and their technology available for minimizing relevant to this Study and a copy of life stages that are in the vicinity of the adverse environmental impact that is written comments received as a result of cooling water intake structure and are less stringent than the requirements of such consultation; and most susceptible to impingement and this subpart to the extent necessary for (iv) A sampling plan for any new field entrainment; you to comply with the Commission’s studies you propose to conduct in order (ii) A characterization of those species safety requirement. to ensure that you have sufficient data of fish and shellfish and life stages (g) You must submit the application to develop a scientifically valid estimate pursuant to paragraph (b)(3)(i) of this information required in § 125.95, of impingement and entrainment at your section, including a description of the implement the monitoring requirements site. The sampling plan must document abundance and temporal/spatial specified in § 125.96, and implement all methods and quality assurance/ characteristics in the vicinity of the the record-keeping requirements quality control procedures for sampling cooling water intake structure, based on specified at § 125.97. and data analysis. The sampling and the collection of a sufficient number of § 125.95 As an owner or operator of a data analysis methods you propose must years of data to characterize annual, Phase II existing facility, what must I collect be appropriate for a quantitative survey seasonal, and diel variations in and submit when I apply for my reissued and include consideration of the impingement mortality and entrainment NPDES permit? methods used in other studies (e.g., related to climate/weather (a) You must submit to the Director performed in the source waterbody. The differences, spawning, feeding and the application information required by sampling plan must include a water column migration); 40 CFR 122.21(r)(2), (3) and (5) and the description of the study area (including (iii) Documentation of the current Comprehensive Demonstration required the area of influence of the cooling impingement mortality and entrainment by paragraph (b) of this section at least water intake structure), and provide a of all life stages of fish and shellfish at VerDate 11 your facility and an estimate of demonstrates the efficacy of the required by paragraphs (b)(4)(ii) and (iii) impingement mortality and entrainment technology for those species; of this section. under the calculation baseline. The (ii) A narrative description of the (5) Information to Support Proposed documentation may include historical design and operation of all design and Restoration Measures. If you propose to data that are representative of the construction technologies or operational use restoration measures to meet the current operation of your facility and of measures (existing and proposed) that performance standards in § 125.94, you biological conditions at the site. you have in place or will use to meet the must submit the following information Impingement mortality and entrainment requirements to reduce entrainment of with your application for review and samples to support the calculations those species expected to be the most approval by the Director: required in paragraph (b)(4)(iii) and susceptible to entrainment, if (i) A list and narrative description of (b)(5)(ii) of this section must be applicable, and information that the restoration measures you have collected during periods of demonstrates the efficacy of the selected and propose to implement; representative operational flows for the technology for those species; (ii) A quantification of the combined cooling water intake structure and the (iii) Calculations of the reduction in benefits from implementing design and flows associated with the samples must impingement mortality and entrainment construction technologies, operational be documented; of all life stages of fish and shellfish that measures and/or restoration measures (iv) An identification of species that would be achieved by the technologies and the proportion of the benefits that can be attributed to each. This are protected under Federal, State, or and operational measures you have quantification must include: the percent Tribal law (including threatened or selected based on the Impingement reduction in impingement mortality and endangered species) that might be Mortality and Entrainment entrainment that would be achieved susceptible to impingement and Characterization Study in paragraph through the use of any design and entrainment by the cooling water intake (b)(3) of this section. In determining construction technologies or operational structure(s). compliance with any requirements to reduce impingement mortality or measures that you have selected (i.e., (4) Design and Construction entrainment, you must assess the total the benefits you would achieve through Technology Plan. If you choose to use reduction in impingement mortality and impingement and entrainment design and construction technologies or entrainment against the calculations reduction); a demonstration of the operational measures in whole or in part baseline determined in paragraph (b)(3) benefits that could be attributed to the to meet the requirements of § 125.94, of this section. Reductions in restoration measures you have selected; you must submit a Design and impingement mortality and entrainment and a demonstration that the combined Construction Technology Plan to the from this calculation baseline as a result benefits of the design and construction Director for review and approval. In the of any design and construction technology(ies), operational measures, plan you must provide the capacity technologies and operational measures and/or restoration measures will utilization rate for your facility and already implemented at your facility maintain fish and shellfish at a level provide supporting data ( including the should be added to the reductions comparable to that which would be average annual net generation of the expected to be achieved by any achieved under § 125.94. If it is not facility (in Mwh) measured over a five additional design and construction possible to demonstrate quantitatively year period (if available) of technologies and operational measures that restoration measures such as representative operating conditions and that will be implemented, and any creation of new habitats to serve as the total net capacity of the facility (in increases in fish and shellfish within spawning or nursery areas or MW)) and calculations. The plan must the waterbody attributable to your establishment of riparian buffers will explain the technologies and restoration measures. Facilities that achieve comparable performance, you operational measures you have in place recirculate a portion of their flow may may make a qualitative demonstration or have selected to meet the take into account the reduction in that such measures will maintain fish requirements in § 125.94. (Examples of impingement mortality and entrainment and shellfish in the waterbody at a level potentially appropriate technologies associated with the reduction in flow substantially similar to that which may include, but are not limited to, when determining the net reduction would be achieved under § 125.94; wedgewire screens, fine mesh screens, associated with existing technology and (iii) A plan for implementing and fish handling and return systems, operational measures. This estimate maintaining the efficacy of the barrier nets, aquatic filter barrier must include a site-specific evaluation restoration measures you have selected systems, and enlargement of the cooling of the suitability of the technology(ies) and supporting documentation to show water intake structure opening to reduce based on the species that are found at that the restoration measures, or the velocity. Examples of potentially the site, and/or operational measures restoration measures in combination appropriate operational measures may and may be determined based on with design and construction include, but are not limited to, seasonal representative studies (i.e., studies that technology(ies) and operational shutdowns or reductions in flow, and have been conducted at cooling water measures, will maintain the fish and continuous operations of screens.) The intake structures located in the same shellfish in the waterbody, including plan must contain the following waterbody type with similar biological the community structure and function, information: characteristics) and/or site-specific to a level comparable or substantially (i) A narrative description of the technology prototype studies; similar to that which would be achieved design and operation of all design and (iv) Documentation which through § 125.94(b) or (c); construction technologies or operational demonstrates that the location, design, (iv) A summary of any past, ongoing, measures (existing and proposed), construction, and capacity of the or voluntary consultation with including fish handling and return cooling water intake structure appropriate Federal, State, and Tribal systems, that you have in place or will technologies you have selected reflect fish and wildlife agencies regarding the use to meet the requirements to reduce best technology available for meeting proposed restoration measures that is impingement mortality of those species the applicable requirements in § 125.94; relevant to this Study and a copy of any expected to be most susceptible to (v) Design calculations, drawings, and written comments received as a result of impingement, and information that estimates to support the descriptions such consultation; and VerDate 11 (v) Design and engineering Plan to the Director for review and § 125.96 As an owner or operator of a calculations, drawings, and maps approval. The plan must contain the Phase II existing facility, what monitoring documenting that your proposed following information: must I perform? restoration measures will meet the (A) A narrative description of the As an owner or operator of a Phase II restoration performance standard at design and operation of all design and existing facility, you must perform § 125.94(d). construction technologies and monitoring as specified by the Director (6) Information to Support Site- operational measures, and restoration to demonstrate compliance with the specific Determination of Best measures (existing and proposed) that applicable requirements of § 125.94. Technology Available for Minimizing you have selected in accordance with § 125.97 As an owner or operator of a Adverse Environmental Impact. If you § 125.94(d), and information that Phase II existing facility, what records must have chosen to request a site-specific demonstrates the efficacy of the I keep and what information must I report? determination of best technology technology for those species; As an owner or operator of a Phase II available for minimizing adverse (B) An engineering estimate of the existing facility you are required to keep environmental impact pursuant to efficacy of the proposed and/or records and report information and data § 125.94(c) because of costs significantly implemented technologies or to the Director as follows: greater than those EPA considered in operational measures for reducing (a) You must keep records of all the establishing the requirements at issue, impingement mortality and entrainment data used to complete the permit or because costs are significantly greater of all life stages of fish and shellfish. application and show compliance with than the benefits of complying with the This estimate must include a site- the requirements of § 125.94, any otherwise applicable requirements of specific evaluation of the suitability of supplemental information developed § 125.94(b) and (e) at your site, you must the technologies or operational under § 125.95, and any compliance provide the following additional measures for reducing impingement monitoring data conducted under information with your application for mortality and entrainment based on § 125.96, for a period of at least three (3) review by the Director: representative studies (e.g., studies that years. The Director may require that (i) Comprehensive Cost Evaluation have been conducted at cooling water these records be kept for a longer Study. You must perform and submit intake structures located in the same period. the results of a Comprehensive Cost waterbody type with similar biological (b) You must provide annually to the Evaluation Study. This information is characteristics) and/or site-specific Director a status report that includes required to document the costs of technology prototype studies; appropriate monitoring data as specified implementing your Design and by the Director. Construction Plan under § 125.95(b)(4) (C) Documentation which above and the costs of the alternative demonstrates that the technologies, § 125.98 As the Director, what must I do to technologies and operational measures operational measures, or restoration comply with the requirements of this you propose to implement at your site. measures selected would reduce subpart? You must submit detailed engineering impingement mortality and entrainment (a) Permit Application. As the cost estimates to document the costs of to the extent necessary to satisfy the Director, you must review materials implementing the technologies or requirements of § 125.94; and submitted by the applicant under 40 operational measures in your Design (D) Design calculations, drawings, and CFR 122.21(r) and § 125.95 before each and Construction Plan. estimates to support the descriptions permit renewal or reissuance. (ii) Valuation of the Monetized required by paragraphs (b)(6)(iii)(A) and (1) After receiving the permit Benefits of Reducing Impingement and (B) of this section. application from the owner or operator Entrainment. If you are seeking a site- (7) Verification Monitoring Plan. You of a Phase II existing facility, the specific determination of best must include in the Study a plan to Director must determine which of the technology available for minimizing conduct, at a minimum, two years of standards specified in § 125.94 to apply adverse environmental impact because monitoring to verify the full-scale to the facility. In addition, the Director of costs significantly greater than the performance of the proposed or must review materials to determine benefits of complying with the implemented technologies, operational compliance with the applicable otherwise applicable requirements of measures, or restoration measures. The standards. § 125.94(b) and (e) at your site, you must verification study must begin once the (2) At each permit renewal, the use a comprehensive methodology to technologies, operational measures, and Director must review the application fully value the impacts of impingement restoration measures are implemented materials and monitoring data to mortality and entrainment at your site and continue for a period of time that determine whether requirements, or and the benefits achievable by is sufficient to demonstrate that the additional requirements, for design and compliance with the applicable facility is reducing the level of construction technologies or operational requirements of § 125.94. The benefit impingement and entrainment to the measures should be included in the study must include a description of the levels documented pursuant to permit. methodology used, the basis for any paragraphs (b)(4)(iii), (b)(5)(ii), and/or (b) Permitting Requirements. Section assumptions and quantitative estimates, (b)(6)(iii)(B) of this section. The plan 316(b) requirements are implemented and an analysis of the effects of must describe the frequency of for a facility through an NPDES permit. significant sources of uncertainty on the monitoring and the parameters to be As the Director, you must consider the results of the study. monitored and the basis for determining information submitted by the Phase II (iii) Site-Specific Technology Plan. the parameters and the frequency and existing facility in its permit Based on the results of the duration for monitoring. The plan must application, and determine the Comprehensive Cost Evaluation Study also describe the information to be appropriate requirements and and the valuation of the monetized included in a yearly status report to the conditions to include in the permit benefits of reducing impingement and Director. The Director will use the based on the alternative for establishing entrainment required by paragraphs verification monitoring to confirm that best technology available chosen by the (b)(7))(i) and (ii) of this section, you you are meeting the applicable facility. The following requirements must submit a Site-Specific Technology requirements of § 125.94. must be included in each permit: VerDate 11 (1) Cooling Water Intake Structure implemented and require additional or require that the monitoring continue for Requirements. The permit conditions different design and construction a sufficient period of time to must include the performance standards technologies, if needed, to meet the demonstrate that the restoration that implement the requirements of impingement mortality and entrainment measures meet the requirements of § 125.94(b)(2), (3), and (4); § 125.94(c)(1) reduction requirements for all life stages § 125.94(d). and (2); § 125.94(d); § 125.94(e); and of fish and shellfish. In addition, you (iii) For a facility that requests § 125.94(f). In determining compliance may consider any chemical, water requirements based on site-specific best with the flow requirement in quality, and other anthropogenic technology available for minimizing § 125.94(b)(4)(ii), the Director must stresses on the source waterbody in adverse environmental impact, you consider anthropogenic factors (those order to determine whether more must review the application materials not considered ‘‘natural’’) unrelated to stringent conditions are needed to and any other information you may the Phase II existing facility’s cooling comply with the requirements of other have that would be relevant to a water intake structure that can influence applicable Federal, State, or Tribal law determination of whether alternative the occurrence and location of a in accordance with § 125.94(e). requirements are appropriate for the facility. If you determine that alternative thermocline. These include source (ii) If you determine that restoration requirements are appropriate, you must water inflows, other water withdrawals, measures are appropriate at the Phase II make a site-specific determination of managed water uses, wastewater existing facility, you must review the best technology available for discharges, and flow/level management Information to Support Proposed minimizing adverse environmental practices (e.g., some reservoirs release Restoration Measures required under impact in accordance with § 125.95(c). water from deeper bottom layers). The § 125.95(b)(5) and determine whether (2) Monitoring Conditions. The permit Director must coordinate with the proposed measures, alone or in must require the permittee to perform appropriate Federal, State, or Tribal fish combination with design and the monitoring required in § 125.96. In or wildlife agencies to determine if any construction technologies and determining applicable monitoring disruption is beneficial to the operational measures, will maintain the requirements, the Director must management of fisheries. fish and shellfish in the waterbody at a consider the facility’s verification (i) You must review the Design and comparable level to that which would monitoring plan, as appropriate. You Construction Technology Plan required be achieved under § 125.94. If the may modify the monitoring program in § 125.96(b)(4) to evaluate the application includes a qualitative when the permit is reissued and during suitability and feasibility of the demonstration for restoration measures the term of the permit based on changes technology or operational measures that will result in increases in fish and in physical or biological conditions in proposed to meet the requirements of shellfish that are difficult to quantify, the vicinity of the cooling water intake § 125.94. In each reissued permit, you you must determine whether the structure. must include a condition requiring the proposed measures will maintain fish (3) Record Keeping and Reporting. At facility to reduce impingement mortality and shellfish in the waterbody at a level a minimum, the permit must require the and entrainment commensurate with substantially similar to that which permittee to report and keep records as the implementation of the technologies would be achieved under § 125.94. You required by § 125.97. in the permit. In considering a permit must also review and approve the application, the Director must review proposed Verification Monitoring Plan [FR Doc. 02–5597 Filed 4–8–02; 8:45 am] the performance of the technologies submitted under § 125.95(b)(7) and BILLING CODE 6560–50–P VerDate 11 Part III Department of the Treasury Office of Thrift Supervision 12 CFR Parts 563b, 574, and 575 Mutual Savings Associations, Mutual Holding Company Reorganizations, and Conversions From Mutual to Stock Form; Proposed Rule VerDate 11 DEPARTMENT OF THE TREASURY Facsimiles: Send facsimile mutual-to-stock conversions. OTS also transmissions to FAX Number (202) reviewed its policies, practices, and Office of Thrift Supervision 906–6518, Attention Docket No. 2002– regulations to assess whether additions 11. or revisions were necessary. 12 CFR Parts 563b, 574, and 575 E-Mail: Send e-mails to To respond completely to all the [email protected], Attention suggestions for change, OTS developed [No. 2002–11] Docket No. 2002–11, and include your a comprehensive regulatory strategy name and telephone number. governing mutual institutions, MHC RIN 1550–AB24 Public Inspection: Comments and the reorganizations, and the mutual-to-stock related index will also be posted on the Mutual Savings Associations, Mutual conversion process. This comprehensive OTS Internet Site at http:// Holding Company Reorganizations, strategy includes: (1) New policy and www.ots.treas.gov. In addition, and Conversions From Mutual to Stock examination guidance; (2) these re- interested persons may inspect Form proposed regulations for the mutual-to- comments at the Public Reference stock conversion process and MHC AGENCY: Office of Thrift Supervision, Room, 1700 G Street, NW., by minority stock offerings; and (3) Treasury. appointment. To make an appointment revisions to the application forms used ACTION: Notice of proposed rulemaking. for access, call (202) 906–5922, send an for the mutual-to-stock conversion e-mail to [email protected], or process. SUMMARY: The Office of Thrift send a facsimile transmission to (202) Since the First Proposal was Supervision (OTS) proposes to amend 906–7755. (Prior notice identifying the published over 18 months ago, OTS has its regulations on the mutual-to-stock materials you will be requesting will issued guidance covering several areas conversion process and portions of its assist us in serving you.) Appointments of concern to commenters. To enable the regulations on mutual holding company will be scheduled on business days public to consider the interaction reorganizations. This document is a re- between 10 a.m. and 4 p.m. In most between that guidance and the changes proposal (Re-proposal) of the Notice of cases, appointments will be available OTS is making to the First Proposal, Proposed Rulemaking (First Proposal) the next business day following the date OTS is publishing this Re-proposal to published July 12, 2000. OTS a request is received. seek further comment. FOR FURTHER INFORMATION CONTACT: extensively modified the First Proposal II. Policy Guidance as a result of the public comments it David A. Permut, Senior Attorney, (202) received and seeks public comment on 906–7505; Gary Jeffers, Senior Attorney, In the First Proposal, OTS indicated it those revisions. As part of a wholesale (202) 906–6457, Business Transactions would issue policy guidance in certain review of treatment of mutual Division, Chief Counsel’s Office; or areas regarding mutual associations in institutions, OTS separately has Mary Jo Johnson, Project Manager, (202) connection with the changes to the modified its examination and 906–5739, Supervision Policy, Office of MHC and conversion regulations. OTS supervisory policies to address many of Thrift Supervision, 1700 G Street, NW., has developed new examination the concerns mutual institutions have Washington, DC 20552. guidance to address many of the raised with OTS over the years. SUPPLEMENTARY INFORMATION: concerns mutual associations raised, within the context of safe and sound This Re-proposal includes I. Background modifications to the provisions operations. OTS has also enhanced its addressing business plans. In addition, Pursuant to its broad authority to off-site monitoring systems to provide it addresses certain matters involving regulate mutual savings associations, examiners with comparative peer conversions from the mutual to the authorize mutual holding company groups of similarly situated mutual stock form, by, among other things, (MHC) reorganizations, and regulate associations. adding demand account holders to the mutual-to-stock conversions of savings Accordingly, OTS has separately definition of savings account holders, associations under the Home Owners’ issued the following new or revised Loan Act (HOLA),1 on July 12, 2000, guidance: allowing accelerated vesting in • management benefit plans for changes OTS published an Interim Final Rule Regulatory Bulletin 27b on of control, adding rules to establish (Interim Rule), revising OTS repurchase Compensation. This revised bulletin charitable organizations, and clarifying restrictions applicable to recently clarifies that mutual associations are the policy on the amount of proceeds converted institutions, changing OTS subject to and governed by the same allowed to be retained at the holding policy on waivers of dividends by prudential standards as stock company level. We are also requesting MHCs and making certain technical associations. OTS intends this guidance comment regarding certain additional changes to the regulations as a result of to enhance the ability of mutual proposed changes to the OTS Mutual the passage of the Gramm-Leach-Bliley associations to provide competitive Holding Company Regulations. Act of 1999 (GLB Act).2 On the same compensation plans to attract and retain day, OTS published a Notice of qualified management and staff. DATES: Written comments must be • Proposed Rulemaking, proposing Thrift Activities Handbook Section received on or before May 9, 2002. changes to OTS rules governing stock 110, Capital Stock and Ownership. This ADDRESSES: Mail: Send comments to conversions and MHCs.3 revised handbook section includes a Regulation Comments, Chief Counsel’s OTS undertook these actions based on new section on mutual associations that Office, Office of Thrift Supervision, numerous discussions with the differentiates them from stock 1700 G Street, NW., Washington, DC management of mutual institutions, its associations, particularly by discussing 20552, Attention Docket No. 2002–11. experience with the conversion process, member rights and ownership Delivery: Hand deliver comments to and developments in the marketplace differences. • the Guard’s Desk, East Lobby Entrance, regarding MHC reorganizations and Thrift Activities Handbook Section 1700 G Street, NW., from 9 a.m. to 4 430, Operations Analysis. This revised p.m. on business days, Attention 1 12 U.S.C. 1464(a), (i) and (p) and 1467a(o). handbook section includes: a new Regulation Comments, Chief Counsel’s 2 65 FR 43088. section on the importance of capital for Office, Docket No. 2002–11. 3 65 FR 43092. mutual associations; information on VerDate 11 Return On Assets (ROA) for all savings are discussed in the item-by-item expressed by the commenters about the associations; a new section on summary below. expense of the meeting, OTS notes that, evaluation of earnings in different if the board desires, OTS will send a IV. Item-by-Item Summary structures (mutual associations, stock representative from the Regional Office associations, subchapter S corporations, A. General to the association to meet with the board Internet operations); and information on The greatest number of comments on of directors. To ensure that such a the new mutual-only ratios in the the First Proposal and the most meeting occurs early in the process, Uniform Thrift Performance Report substantial concerns expressed by the however, OTS expects to meet with the board of directors at least ten days prior (UTPR) and how examiners can commenters involved the business plan, to the passage of a Plan of Conversion appropriately compare mutual and stock Regional Office non-objection to the or Plan of Reorganization. At that time, associations so that peer groups are business plan, and the pre-filing OTS would expect the board of directors more appropriate. meeting requirements. While the Re- to have prepared a short, written The revised examination procedures proposal requires pre-filing meetings, in strategic plan for OTS to review and will improve supervision of mutual response to the comments, OTS has discuss with the board at the meeting. associations. They will be targeted more revised when pre-filing meetings must OTS reiterates that the purpose of this directly to the quality of operations, risk be held and has eliminated the meeting is not to substitute the agency’s management, capital needs and requirement to obtain OTS non- formation, and internal controls, judgment for that of the directors. OTS objection to conversion business plans merely proposes to require the board to enabling examiners to gauge the overall before filing. Similarly, OTS has revised financial condition of mutual articulate its plans for the association the business plan standards to be and the implications of those plans associations more effectively. OTS is addressed by converting associations changing its off-site monitoring systems before any process actually begins and and considered in OTS review in before the institution spends significant to allow examiners to conduct financial response to the comments. analyses for mutual institutions by funds. comparing them with mutual B. Pre-filing Meeting C. Prior OTS Non-Objection to Business institutions instead of stock institutions. Under the First Proposal, OTS would Plan In addition, for mutual associations have required each association seeking to augment their capital base, The First Proposal provided that contemplating a conversion to meet applicants could not submit a OTS is exploring the feasibility and with the appropriate Regional Office, in conversion application until the utility of various capital-raising a pre-filing meeting, to discuss the converting association had submitted, alternatives, such as the use of proposed business plan. The board of and OTS had advised the association subordinated debt instruments, mutual directors, or a committee of the board that it had not objected to, the capital certificates, non-withdrawable including outside directors, were association’s business plan. Many accounts, trust preferred securities, and encouraged to attend the meeting. The commenters objected to this other financing transactions. association would then have submitted requirement, asserting that the III. Summary of Comments the proposed business plan at least 30 requirement added delay and expense to days prior to submitting its conversion the conversion process, was unduly OTS received 46 comment letters on application, and would have needed to the First Proposal and the Interim Rule. burdensome, or gave the Regional receive the non-objection of the Director the ability to prevent a Three were requests to extend the Regional Director to the business plan 4 conversion if the Regional Director comment period. Five individuals, ten before submitting either an application law firms, 14 thrifts, 15 trade groups, disagreed with the business plan. to convert to stock form or a notice to Although OTS does not believe the and the Federal Deposit Insurance reorganize to MHC form if the prior non-objection requirement would Corporation (FDIC) submitted reorganization included a stock be as burdensome in practice as comments. OTS participated in issuance. anticipated by certain commenters, the meetings on the regulations sponsored A number of commenters opposed the Re-proposal does not require OTS non- by America’s Community Bankers on pre-filing meeting in its entirety, objection to the business plan prior to September 12 (attended by 24 although two commenters, both an association filing a conversion attorneys), September 28 (conference regulators, supported such meetings. application. Under the Re-proposal, telephone call with representatives from One commenter suggested that business plans must be filed at the time 45 mutual institutions, two outside depositors, consumer advocates, or a conversion application is submitted, counsel, representatives of the FDIC and other interested parties be invited to the or the application will be rejected as the Board of Governors of the Federal pre-filing meeting. Several commenters materially deficient. As a practical Reserve System (Federal Reserve)), and opposed both the pre-filing meeting and matter, however, OTS strongly November 3 (with representatives of the the pre-approval of the business plan as encourages submission of business FDIC and the Federal Reserve). OTS also intrusive and a source of unnecessary plans before the application filing to held focus group meetings with delay and expense. A number of help ensure timely approval of the executives from mutual savings commenters thought OTS was requiring conversion application. associations in Washington on January the whole board to attend the pre-filing 8, 2001, and in Boston on February 26, meeting at the Regional Office with all D. Business Plan Standards 2001, to listen to the views of mutual of the costs of attending such a meeting The First Proposal provided that a institutions on specific questions raised falling on the association. converting association’s business plan in the preamble to the proposed It has been OTS’ normal practice to must, among other things: (i) Clearly regulation. Issues raised by commenters discuss a savings association’s and completely describe projected conversion plans with the board of operations, including the deployment of 4 On October 10, 2000, OTS extended the comment period on the two regulations from directors. Therefore, a pre-filing meeting conversion proceeds; (ii) demonstrate October 10, 2000 to November 9, 2000. 65 FR does not result in any additional that the plan of conversion will 60123. burden. In response to the concerns substantially serve to meet credit and VerDate 11 lending needs in the proposed market conversions, and in OTS’ view, the conversion. OTS will view a return of area; (iii) demonstrate a reasonable need regulations do not establish such a test capital to shareholders (such as a for new capital to support projected or impose a moratorium. As to the special dividend) in the first year operations and activities; (iv) describe comments regarding OTS’ conversion following conversion to be a material the association’s experience with prior authority in general, OTS has for deviation from the business plan that growth, expansion, or other activities decades had significant regulations requires the prior written approval of similar to those proposed in the governing all aspects of the conversion the Regional Director. business plan; (v) describe the risks process, and the HOLA explicitly E. MHCs and Mutuality associated with the plan; (vi) provides that ‘‘conversions shall be demonstrate adequate expertise and subject to such regulations as the In the preamble to the First Proposal, staffing to manage growth prudently; Director shall prescribe.’’ 5 OTS asked a series of questions about and (vii) demonstrate that the OTS, as the safety and soundness what OTS could do to enhance the association will achieve a reasonable regulator of savings associations, attractiveness of the MHC charter. OTS return on equity. The First Proposal also believes the specific requirements are also specifically stated that it provided that the association could not appropriate to ensure that an association encouraged savings associations that project stock repurchases, returns of contemplating such a significant were considering conversion to stock capital, or extraordinary dividends in transaction, with considerable form to first carefully consider the the business plan. ramifications regarding capital, choice of an MHC charter as an interim All commenters who discussed the management, and business operations, step. In addition, OTS specifically business plan opposed the proposed has considered the consequences of the proposed certain changes to the MHC business plan requirements. Four transaction in its business plan. regulations to permit the issuance of commenters supported the concept of Accordingly, the Re-proposal continues additional stock benefit plans, easier business plan guidance in the to include a business plan requirement, voting requirements, and a number of regulations but were opposed to the and sets forth the factors OTS will other innovations that OTS thought specific guidance OTS provided. The consider in evaluating business plans.6 would enhance the attractiveness of the various commenters asserted: (i) The Several of the comments demonstrate MHC option. Taken together, these steps creation of a business plan is that commenters believed the various appeared to many commenters as management’s responsibility, and OTS factors in the First Proposal were expressing an agency bias for the MHC should not second-guess management, separate standards that had to be form. Many commenters expressed their further, a limited number of satisfied for approval of a conversion. disagreement with this perceived commenters questioned OTS’s authority The Re-proposal clarifies that OTS will agency bias, believed OTS was putting to impose business plan standards; (ii) weigh all of the factors together, and no a moratorium on stock conversions, or business plans based on Return On single factor will determine whether a argued OTS was impinging on the Equity (ROE) are inappropriate and business plan is acceptable. For freedom of savings associations to would not work for most associations, example, lack of management choose their form of charter. and the proposed ROE criterion would experience with past growth will not be OTS suggestions on enhancing the have caused 85 percent of conversions as significant if the business plan MHC charter were intended to expand prior to 2000 to be disapproved; (iii) it demonstrates realistic deployment of the options available to a mutual is inappropriate for OTS to determine the conversion proceeds for new association, not to give preference to how much capital must be invested in growth, such as enhancing ways to meet one form of charter over another. what type of community development increased credit and lending needs in activities; (iv) the business plan The MHC is an alternative for mutual the market. associations that are contemplating standards were seriously flawed, OTS recognizes that commenters were unattainable, arbitrary, unrealistic, or conversion to stock form. The MHC concerned about reliance on ROE as a structure retains the benefits and protectionist; (v) the business plan test to determine whether to approve a created a ‘‘needs’’ test for conversions; essential nature of the mutual charter, business plan. OTS reiterates that in while providing greater access to capital (vi) the First Proposal would chill evaluating ROE as a factor in the management decision making; (vii) the markets. In addition, in section 401(b) of business plan, ROE in the first years the GLB Act,7 Congress expanded the First Proposal would create a after conversion will not be given as moratorium on conversions; (viii) the investment and activities authority of much weight as the association’s ROE MHCs to include the activities of First Proposal would cause unnecessary near the end of the three-year business delays or would be unduly burdensome; financial holding companies. OTS plan period, when the association has amended the MHC regulations to reflect (ix) the business plan requirements had time to deploy most, if not all of the would penalize associations in slow those changes.8 OTS is re-proposing conversion proceeds. significant enhancements to the MHC growth areas, would not work for small As for stock repurchases, today’s Re- thrifts, would prejudice capital raising, form to make it a long-term alternative proposal permits stock repurchases to to full conversion. or ignore investor needs; (x) the be included in the business plan. A OTS also continues to encourage business plan disallows use of stock business plan that contemplates stock mutual associations seeking new capital repurchases as a legitimate business repurchases as the primary use of new to seriously consider the MHC form of management tool, which is inconsistent capital, however, will not be regarded reorganization with a limited stock with the Interim Rule eliminating favorably. OTS recognizes that some issuance, rather than a full conversion. restrictions on repurchases during the stock repurchases may occur, although This is a particularly useful alternative second and third years after conversion; the Re-proposal continues to limit stock for mutual associations that have no (xi) the First Proposal penalizes repurchases in the first year following management for lack of experience; and immediate plans for deployment of (xii) the First Proposal lacks flexibility. substantial amounts of new capital. 5 12 U.S.C. 1464(i)(1). Neither the First Proposal nor the Re- 6 OTS notes that there is no requirement to submit proposal were intended to create a a business plan for an MHC reorganization without 7 Pub. L. 106–102, 113 Stat. 1338 (1999). ‘‘needs’’ test or a moratorium on a stock issuance. 8 65 FR 43088, Jul. 12, 2000. VerDate 11 F. Mutual Capital Questions 563b.515. OTS is also re-proposing conflict of interest for directors and OTS asked a number of questions in corresponding amendments to the MHC officers who make financial decisions the preamble to the First Proposal regulations at § 575.11(c). In response to where they may personally benefit. OTS regarding capital for mutual the comment that associations that may take enforcement action if it associations. OTS observed that mutual engage in second step stock conversions discovers wrongdoing. OTS notes that associations could currently raise should receive different treatment, OTS the waiver of dividends results in more additional capital in a number of ways believes that fully converted companies capital at the savings association, that did not involve conversion to stock should receive the same treatment enhancing the safety and soundness of form. These methods included mutual whether they reach that status in one the savings association. step or two. In addition, OTS believes capital certificates, subordinated debt, I. Charitable Organizations trust preferred securities, or the it is in the best interest of applicants to The First Proposal included formation of real estate investment have similar treatment of stock provisions regarding the establishment trusts (REITs). OTS asked if there were repurchases among the agencies of a charitable organization in other methods of raising capital and regulating the conversion process. connection with a mutual-to-stock why the methods mentioned were not As a matter of policy, OTS has taken conversion. The provisions included widely used. While no written the position that stock repurchases for discussing the purpose of the charitable comments were received on this issue, management benefit plans that have organization, voting foundation shares attendees at the two focus group been ratified by shareholders in the first in the same ratio as all other shares meetings indicated these methods of year following conversion do not count voted on proposals considered by raising additional capital were generally toward the repurchase limitations in shareholders, reserving board seats for considered too expensive for a mutual § 563b.3(g). The Re-proposal, at new an independent director and a director association to undertake, particularly for § 563b.510, clarifies this point. from the association, and dealing with smaller associations. OTS is exploring, However, OTS would still require prior conflicts of interest. The Re-proposal among other approaches, the possibility notification of any repurchases in the also specifies the conditions for of mutual associations participating first year following conversion, even if approval including examination by OTS with other mutual associations in larger they are not subject to OTS approval at foundation expense, submission of capital offerings to reduce the costs. under the repurchase limitations. One The preamble to the First Proposal commenter inquired whether a stock annual reports, and compliance with all requested comment on whether OTS repurchase more than one year after laws necessary to maintain the should issue guidance regarding capital conversion would require Regional foundation’s tax-exempt status. All commenters on this aspect of the distributions by mutual associations. A Director approval as a material First Proposal were in favor of the number of commenters addressed this deviation from the business plan. OTS proposed regulations, although one issue, all suggesting OTS not issue believes that it may constitute a material commenter thought OTS should require guidance in this area because they felt deviation, depending on what the a separate vote of the minority this should be a business decision of the business plan disclosed. However, shareholders to establish a foundation association. OTS generally agrees and, current MHC regulations permit in second step conversions. OTS already therefore, OTS does not propose to issue purchases of stock in the open market requires a separate minority shareholder guidance on capital distributions by for tax-qualified or non-tax-qualified employee stock benefit plans to be vote in such transactions and has mutual associations as part of this included that requirement in the Re- proposal.9 excluded from the repurchase limitations.10 The Re-proposal will proposal. One commenter asserted that G. Stock Repurchases extend this exclusion from the 10–25% of the proceeds from every In the Interim Rule, OTS revised its repurchase limitations to fully mutual-to-stock conversion should be regulations to eliminate restrictions on converted companies. OTS notes that required to be placed in a charitable stock repurchases by converted savings the FDIC permits purchases for organization. OTS does not believe it is associations after the first year following employee stock benefit plans to be a regulatory function to determine the conversion. The rule change was made excluded from the repurchase amount of proceeds that must be placed in part to bring OTS policy closer to that limitations for fully converted in a charitable organization. In response to the comments, OTS has included the of the FDIC on this subject. Several companies. charitable organization provisions in the commenters expressed appreciation that H. Dividend Waivers Re-proposal, and proposes several the rules of the two agencies would now The Interim Rule revised OTS policy technical amendments suggested by one be similar. Almost all the other on dividend waivers for MHCs. Prior commenter to clarify that annual reports commenters on this issue supported OTS policy had adjusted exchange and the percentage of contributed OTS changes, although one commenter ratios for excessive dividends in proceeds must comply with the Internal suggested repurchase limitations should conversions of MHCs to stock form. No Revenue Code (IRC). Upon effectiveness be eliminated completely. A number of adjustment is now required, and of a final regulation, waivers from the commenters suggested that there § 575.11(d)(3) was amended to reflect certain provisions in the current should be no restrictions on repurchases this change in OTS policy. Most conversion regulations now routinely for associations completing second step commenters supported this change in requested in a conversion with a stock conversions, because those OTS policy although two opposed the charitable foundation would no longer companies had been public for some change because of the potential conflict be necessary. period of time prior to full conversion of interest for directors and officers OTS takes this opportunity to state to stock form. that in situations where a foundation The Re-proposal is consistent with the making the decision to waive or not becomes a holder of more than 10% of Interim Rule. See §§ 563b.510 and waive dividends. The Re-proposal is unchanged from the Interim Rule. OTS an institution’s common stock, e.g., if 9 Any capital distribution by mutual associations believes there is always a potential the institution repurchases stock, remains subject to the capital distribution causing the foundation’s ownership regulations at 12 CFR part 563, subpart E. 10 See 12 CFR 575.11(c)(1)(iv). percentage to increase, OTS will VerDate 11 consider waivers of the Control L. Management Stock Benefit Plans commenter objected to this proposed Regulations, 12 CFR part 574 and the In the First Proposal, OTS proposed revision as overly intrusive. However, concerted action presumptions in those changing the regulations to allow for OTS believes the regulation is an regulations. accelerated vesting for management appropriate measure of regulatory oversight and is re-proposing it as J. Policy on Acquisitions stock benefit plans in the event of a change of control. Currently, the proposed. To reduce burden, the First Proposal Current OTS regulation § 563b.3(i)(3) regulations only allow acceleration for had proposed a possible check-off box provides that no person or company death or disability. Most commenters in on stock order forms to vote for or this area agreed with this change, may acquire more than 10 percent of against stock benefit plans, when although three suggested OTS add any class of equity security of a recently purchasing stock in MHC stock retirement at least one year following converted association for three years issuances. One of the commenters conversion as another reason for following conversion without OTS pointed out that a check-off box would allowing acceleration. approval. OTS enacted this rule violate NASD rules requiring NASD The Re-proposal is unchanged from principally to provide a reasonable notification for stock benefit plans.12 the First Proposal. OTS believes that it period of time for a recently converted Accordingly, the Re-proposal does not is appropriate that the bases for association to deploy its new capital include that feature of the First acceleration, such as death, disability, prudently according to the plan Proposal. described in the offering documents, to or change of control of the savings While most commenters supported acclimate to operating as a public association, not be within the expansion of option plan opportunities company, and to do both without the individual’s control. Therefore, the Re- for MHCs, several commenters were distraction of considering takeover proposal does not provide for opposed to any options for management proposals. (See approval standards at accelerated vesting based on retirement. based on conflicts of interest or a view One commenter suggested that current § 563b.3(i)(5) or proposed that benefit plans were a way for because the National Association of § 563b.525(d).) management to enrich itself. One Securities Dealers Automated Quotation commenter suggested management In the First Proposal, OTS noted that system (NASDAQ) requires a vote for benefit plans should be limited to 2% of it intended to closely review certain stock benefit plans, OTS did not the stock issued. In response to those applications under the existing need to duplicate that requirement.11 comments, OTS is adding a clarification standards to make sure all criteria are OTS notes, however, that not all to the Re-proposal that OTS will not fully met before approving acquisitions converting associations and MHCs approve management benefit plans that within the first three years following engaging in stock issuances are listed on in the aggregate award more than 25% conversion. the NASDAQ. Smaller associations, in of the number of shares ultimately particular, cannot meet NASDAQ listing A number of commenters suggested issued in the public offering to minority requirements. Therefore, OTS believes it that the OTS statement that it intended shareholders. The 25% restriction does is appropriate to continue to include to implement its current regulation was not include ESOP shares allocated to voting requirements in OTS regulations. inappropriate, that these decisions were managers. OTS believes management Several commenters suggested that OTS the responsibility of the board of benefit plans that are reasonable, should follow NASDAQ voting directors, not the regulator, and that a present no safety or soundness requirements (a majority of those voting three-year restriction on acquisitions concerns, and are ratified by the at a legally called meeting) to approve was too inflexible. Three commenters shareholders, are not objectionable. benefit plans. OTS believes, however, thought OTS should implement a five- Most companies use such plans to that a majority of shareholders (not year restriction on acquisitions. After attract qualified executives and to merely a majority of those voting) must considering the comments, for the reward management for performing ratify stock benefit plans because reasons stated above, OTS is re- well. Therefore, OTS is re-proposing issuance of stock to such plans dilutes proposing the regulation as originally most of the proposed changes except as their ownership interests. OTS notes proposed. noted above. One commenter asked if that while NASD Rule § 4350 requires treasury stock could be used to fund shareholder ratification of certain stock K. Demand Account Holders benefit plans. OTS allows treasury stock benefit plans, OTS currently requires In the First Proposal, OTS proposed to to be used for this purpose. shareholder ratification of plans OTS received no comments on the allow demand account holders to be adopted only within the first year considered eligible account holders for First Proposal’s revisions to the following conversion. The First regulations to clarify that OTS will purposes of determining subscription Proposal revised the section on rights in a conversion. Many applicants allow dividend equivalent rights, management benefit plans to clarify that dividend adjustment rights, or other incorrectly believe that demand account an association must present to holders are already eligible account similar provisions that permit cash shareholders for ratification any payments, adjustment of the number of holders. Others have requested OTS material amendments to previously waivers to allow demand account shares, or exercise price of options as a approved management recognition result of stock dividends or splits, in holders to be included in the plans, stock option plans, or other management recognition plans, stock subscription. OTS routinely granted the benefit plans that occur more than one option plans, or other stock benefit waivers. In order to end the confusion year after conversion and that are plans. OTS is including these revisions regarding this issue, OTS proposed inconsistent with the regulation. One in the Re-proposal. OTS does not revising the regulations to include believe these types of provisions, which demand account holders in the 11 See NASD Manual & Notices to Members, are common in option plans, unduly subscription priorities. None of the § 4350(i), Qualitative Listing Requirements for commenters objected to this provision. Nasdaq National Market and Nasdaq SmallCap Market Issues Except for Limited Partnerships 12 See NASD Manual & Notices to Members, OTS has included the original proposal traded on the Nasdaq National Market, Shareholder § 4310(c)(17), Qualification Requirements for in this Re-proposal. Approval (2001). Domestic and Canadian Securities (2001). VerDate 11 benefit recipients, as long as these also permit the use of repurchased 2. Acquisitions of Mutual Holding provisions do not violate OTS vesting shares to attain the new limits. Company Structures requirements or pricing requirements In the First Proposal, OTS also Recently, companies in several MHC for options. See proposed § 563b.500. proposed allowing the adoption of structures have entered into OTS also proposes to add a provision additional stock option plans without transactions, or have received offers to that clarifies a supervisory policy the need to issue stock to all categories enter into transactions, in which an requiring exercise or forfeiture of stock of subscribers. The Re-proposal retains unrelated mutual savings association, benefits in certain circumstances, such this provision. OTS notes that adoption mutual savings bank, or MHC would as if an association becomes critically of additional plans still requires filing acquire the target MHC, mid-tier undercapitalized. See proposed an application with OTS, registering holding company, and subsidiary § 563b.500. additional stock where appropriate, and association. In these transactions, the shareholder ratification of additional mid-tier association’s minority M. Holding Company Proceeds plans. Among the factors OTS will shareholders have been offered cash, The First Proposal stated that at least consider when reviewing additional and the majority mutual interest would 50% of the gross proceeds in a mutual- plans are the purpose for creating the become part of the acquiring mutual to-stock conversion must be infused into additional plans, management ratings, entity. Some of these transactions have the converting savings association, and or supervisory problems at the been friendly, and others have been more must be infused if OTS concludes, converted savings association. As noted hostile acquisition proposals. In the for supervisory reasons, that a larger earlier, commenters were in favor of a context of these transactions, MHCs and capital infusion is necessary. The First check-off approval for benefit plans, but their subsidiary entities have asked: (i) Proposal inadvertently referenced 50% OTS is not re-proposing this item whether mid-tier holding companies (or, of gross proceeds, instead of net because of the NASD rule restrictions. if there is no mid-tier holding company, proceeds. The Re-proposal clarifies that Three commenters urged OTS to the subsidiary savings association) may 50% of the net proceeds must be change its policy on the chartering of adopt the pre-approved charter infused into the savings association. savings association subsidiaries of provisions set forth at 12 CFR One commenter suggested that all the MHCs, or holding companies inserted in 552.4(b)(8), such as the charter proceeds should go to the savings between MHCs and their savings provision prohibiting acquisitions of, association. Several others suggested association subsidiaries (Mid-tiers). and offers to acquire, more than ten OTS should maintain more flexibility Currently Mid-tiers must be chartered percent of any class of equity security of and make a determination on an by OTS. The commenters argued that the entity for five years; and (ii) whether acceptable amount of proceeds retained regular holding companies are state- OTS applies 12 CFR 563b.3(i)(3) to by the holding company, based upon chartered, so Mid-tiers should also be savings association subsidiaries or mid- what the business plan proposed. OTS state-chartered. OTS notes, however, tier holding companies that have issued has determined that the 50% limitation that Mid-tiers are MHCs, and MHCs, by stock within the previous three years. works well, but will examine every statute, must be federally chartered.13 The purposes of the regulatory post- conversion on a case-by-case basis to One commenter asked if OTS would conversion acquisition restriction at 12 determine if the limitation is allow Mid-tiers to adopt limited liability CFR 563b.3(i)(3) and the charter appropriate in that case. bylaws. Although such institutions are provisions in 12 CFR 552.4(a)(8) are to provide recently converted associations N. Mutual Holding Company Revisions federally chartered, OTS has allowed the adoption of limited liability bylaws a period of time in which to deploy 1. General on a case-by-case basis for other federal conversion proceeds into productive associations and, therefore, would assets, to permit management to focus The Interim Rule revised the MHC consider this for Mid-tiers. on the task of investing conversion regulations in accordance with the GLB proceeds and managing their institution, Act and revised OTS treatment of MHC OTS also asked for comments on the and to protect against acquisition efforts dividend waivers. The First Proposal possibility of not requiring a vote of the that may have the potential to disrupt included changes to the MHC members for a simple reorganization to operations in the critical time period regulations conforming to changes made MHC form, without a stock issuance. after conversion.14 In addition, the to the conversion regulations. In the Nine commenters favored such a change charter provisions are designed to allow First Proposal, OTS also proposed to and three opposed it. OTS believes such converted associations more discretion increase the size of stock benefit plans a change may be beneficial to in managing their affairs.15 that associations (or mid-tier holding associations considering a charter Recently completed or proposed companies) under the MHC format change to MHC form, but believes a transactions have demonstrated that could enact. Most commenters were in statutory change is necessary to takeover pressures now exist in the favor of this idea although two opposed accomplish this objective. OTS will context of MHC structures. Minority any benefit plans for management. OTS consider seeking statutory changes in stockholders have sought to pressure is re-proposing the changes as proposed, this area. MHC structures to be acquired by with certain technical revisions, and One commenter asked if OTS would mutual institutions or other MHC with the additional 25% limitation consider an abbreviated application for structures. In light of recent takeover discussed earlier. One commenter asked MHC reorganizations without a stock attempts, and particularly in light of the OTS to clarify that the proposed rules, issuance. OTS already allows hostile situations that have developed, if finalized, would apply to existing abbreviated applications for such OTS has determined to allow the post- MHCs. In response to that comment, reorganizations. These applications, OTS takes this opportunity to indicate however, are subject to the Bank Merger 14 See, e.g., Federal Home Loan Bank Board that the Re-proposal, if finalized, will be Act, which contains statutory time (FHLBB) Resolution No. 85–80 (Jan. 31, 1985), Resolution No, 84–400 (Aug. 2, 1984), Resolution applicable to future stock issuances by frames. No. 84–90 (Feb. 23, 1984), and Resolution No. 76– existing associations or mid-tier holding 848 (Nov. 10, 1976). companies in the MHC format. OTS will 13 See 12 U.S.C. 1467a(o)(7). 15 FHLBB Resolution No. 84–90 (Aug. 2, 1984). VerDate 11 conversion anti-takeover restrictions in P. Merger Conversions • Revise the definition section of the the charter of a mid-tier stock holding One commenter requested OTS to regulation to include only those company. These restrictions would be address whether there is any change in definitions that are not defined consistent with the purposes of those OTS policy on merger conversions. OTS elsewhere in OTS regulations, or to provisions generally and give a newly policy on merger conversions was move specific definitions to the converted MHC time to deploy its new articulated in the preamble to the OTS appropriate section of the regulation. capital and adjust to managing its conversion regulation of 1994, 59 FR See proposed § 563b.25. 16 institution in the MHC environment. 61247, 61254, Nov. 30, 1994. In that • Reduce the number of copies of Accordingly, OTS is allowing mid-tier regulation, OTS stated that it would applications that a savings association holding companies to include the limit merger conversions to cases must file with OTS from ten to seven. provisions set forth at 12 CFR involving financially weak institutions. See proposed § 563b.155. 552.4(b)(8) in their charters. In addition, In addition, OTS indicated it would • Revise the filing requirements to OTS proposes to apply § 563b.3(i)(3) to consider allowing merger conversions mid-tier holding companies and coordinate the place of filing and where a converting institution could number of copies filed, for the subsidiary stock institutions that demonstrate by clear and convincing application for conversion and any complete initial stock offerings under evidence that a standard conversion amendments to the application for § 575.7. OTS requests comment on would not be economically feasible, conversion. See proposed §§ 563b.115, whether it should apply § 563b.3(i)(3) in based on the ratio of expenses to gross 563b.155, 563b.180, and 563b.185. the context of Mid-tiers and MHC proceeds, because of the asset size of the savings association subsidiaries. institution.17 • Codify the current informal 3. ‘‘Second Step Conversions’’ of MHCs In the last eight years OTS has standard requiring a legal opinion approved only one merger conversion. indicating that any marketing materials Section 575.12 of the MHC That approval was based on the criteria comply with all applicable securities regulations generally governs the articulated in the 1994 regulation. OTS laws. See proposed § 563b.150. conversion of MHCs to stock form reiterates the guidelines it established in • (frequently called ‘‘second step Delete the requirement for a legal the 1994 regulation and wishes to conversions’’). In all such transactions opinion regarding insured accounts. See clarify that institutions proposing to date, OTS staff has required that the proposed § 563b.100, Exhibit 3(d). merger conversions should not propose majority of the minority shares of the plans where management of the One commenter also asked for Mid-tier or savings association disappearing institution would receive clarification on whether community subsidiary, as the case may be, vote in anything more than they could if they offerings must occur in conversions. If favor of the second step conversion, in had undertaken a standard conversion. all the stock is sold in the subscription addition to votes otherwise required. In addition, institutions contemplating a phase of a conversion, a community OTS staff has imposed this requirement merger conversion must demonstrate a offering is unnecessary. Another because the minority shareholders merger conversion is the only viable commenter asked if transfer restrictions received different treatment in the alternative, and document what other applied in second step stock second step conversion than the proposed solutions the company conversions. Transfer restrictions apply majority interest. The minority pursued, that the proposed distribution to newly purchased stock in second step shareholders received stock in an of assets is fair to all parties, and that stock conversions, but not to exchange amount to be determined under an the institution used independent shares presuming the appropriate ‘‘exchange ratio’’, while the majority counsel to represent the interests of the transfer restriction time frames have interest (the mutual depositors) received institution. already expired. rights to subscribe to the remaining shares to be issued in the transaction, at Q. Plain Language S. Forms the offering price. OTS staff concluded The First Proposal converted OTS The First Proposal contained that the requirement was appropriate in rules on mutual-to-stock conversions revisions to all of the forms currently in order to help ensure the fairness of the into a plain language format. All six the conversion regulations, and drafted transaction. OTS proposes to include commenters who addressed this change a new form that facilitates the this requirement, which has been commented favorably. One commenter conversion process (Form OF for the applicable to every second step asked if OTS intended to make the same Order Form). In drafting these forms, conversion to date, in the MHC changes to the MHC regulations. OTS OTS moved a number of requirements regulations, at 12 CFR 575.12(a)(3). intends to make similar changes to the currently in the regulations to the O. Supervisory Conversions MHC regulations in a future project. related forms. OTS received one comment on the forms with some minor To conform the language in OTS R. Miscellaneous Revisions technical suggestions for revisions. OTS regulations more closely to sec. 5(o) of In addition to the revisions described concurs with some of the technical the HOLA, the statute governing above, the First Proposal proposed a revisions and has revised the forms supervisory conversions, OTS proposed number of miscellaneous revisions to accordingly. The forms will continue to certain changes to the regulatory filing and other requirements. OTS be available through OTS Washington language regarding Voluntary received no comments on these and Regional Offices and will be Supervisory Conversions. The revised revisions and is re-proposing them as accessible on OTS’s website. language can be found at §§ 563b.625 originally proposed. The miscellaneous and 563b.630 of the Re-proposal. changes will: V. Disposition of Existing Rules 16 The MHC regulations provide that the In the past, OTS staff has informally advised certain 17 See 59 FR 61247, at 61255. OTS gave an procedural and substantive requirements of 12 CFR acquirors that it has not considered § 563b.3(i)(3) to example of institutions with assets of less than $25 563b.3 through 563b.8 apply to all MHC stock be clearly applicable in the MHC context. million as more likely to be able to establish a issuances under § 575.7 unless clearly inapplicable. justification for doing a merger conversion. VerDate 11 Original provision Re-proposed provision Comment 12 CFR 563b.1 ...... 12 CFR 563b.5 ...... Nonsubstantive revision, moved. 12 CFR 563b.2(a) ...... 12 CFR 563b.25 ...... Substantive revisions, deletions, and moved. 12 CFR 563b.2(b) ...... Deleted. 12 CFR 563b.3(a) ...... 12 CFR 563b.5(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(b) ...... 12 CFR 563b.200(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(1) ...... 12 CFR 563b.330(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(2) ...... 12 CFR 563b.355(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(2)(i)–(ii) ...... 12 CFR 563b.375(a), (d) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(3) ...... 12 CFR 563b.360 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(4) ...... 12 CFR 563b.335(b), (c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(4)(i) ...... 12 CFR 563b.320(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(4)(ii) ...... 12 CFR 563b.375(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(4)(iii) ...... 12 CFR 563b.375(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(4)(iv) ...... 12 CFR 563b.375(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(5) ...... 12 CFR 563b.320(d), 365 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(6) ...... 12 CFR 563b.320(e), 335(b), (d) ...... Nonsubstantive revision, deletions, and moved. 12 CFR 563b.3(c)(6)(i) ...... 12 CFR 563b.385(a), (c), 380(a) ...... Substantive revision, deletions, and moved. 12 CFR 563b.3(c)(6)(ii)–(iii) ...... 12 CFR 563b.395 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(6)(iv) ...... 12 CFR 563b.390(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(7) ...... 12 CFR 563b.385(a), (c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(8) ...... 12 CFR 563b.370 ...... Nonsubstantive revision, deletions, and moved. 12 CFR 563b.3(c)(9) ...... 12 CFR 563b.505(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(10) ...... 12 CFR 563b.330(a), 335(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(11) ...... 12 CFR 563b.420(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(12) ...... 12 CFR 563b.445(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(13) ...... 12 CFR 563b.430(d), 445(b), 465, 485 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(14) ...... 12 CFR 563b.25 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(15) ...... 12 CFR 563b.440, 445(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(16) ...... 12 CFR 563b.140, 425 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(17) ...... 12 CFR 563b.505(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(18) ...... 12 CFR 563b.505(b)–(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(19) ...... 12 CFR 563b.530(a)–(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(20) ...... 12 CFR 563b.150(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(21) ...... 12 CFR 563b.130 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(22) ...... 12 CFR 563b.345(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(23) ...... 12 CFR 563b.320(a)–(d), 380(a)–(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(c)(24) ...... 12 CFR 563b.520(a)–(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(d)(1)–(7) ...... Deleted. 12 CFR 563b.3(d)(8) ...... 12 CFR 563b.385(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(d)(9) ...... 12 CFR 563b.385(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(d)(10)–(11) ...... Deleted. 12 CFR 563b.3(d)(12) ...... 12 CFR 563b.390(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(d)(13) ...... Deleted. 12 CFR 563b.3(e)(1) ...... 12 CFR 563b.25 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(e)(2) ...... Deleted. 12 CFR 563b.3(f)(1) ...... 12 CFR 563b.445(b), 450, 455, 480 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(f)(2) ...... 12 CFR 563b.445(b), 450 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(f)(3) ...... 12 CFR 563b.470(e), 475 ...... Revision with partial deletion, moved. 12 CFR 563b.3(f)(4) ...... 12 CFR 563b.460 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(f)(5) ...... 12 CFR 563b.470(a)–(d) ...... Nonsubstantive revision, moved 12 CFR 563b.3(g)(1) ...... 12 CFR 563b.510 ...... Revision with deletion, moved. 12 CFR 563b.3(g)(2) ...... 12 CFR 563b.510, 520(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(g)(3) ...... 12 CFR 563b.510, 515 ...... Substantive revision with deletion, moved. 12 CFR 563b.3(g)(4) ...... 12 CFR 563b.500 ...... Substantive revision, moved. 12 CFR 563b.3(h) ...... 12 CFR 563b.340(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(1)–(2) ...... 12 CFR 563b.340(b)(1) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(3)(i) ...... 12 CFR 563b.525 ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(3)(ii) ...... 12 CFR 563b.420(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(3)(iii) ...... 12 CFR 563b.525(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(4)(i) ...... Deleted. 12 CFR 563b.3(i)(4)(ii)–(iv) ...... 12 CFR 563b.525(c)(1)–(3) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(4)(v) ...... 12 CFR 563b.525(c)(4) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(4)(vi)–(5) ...... 12 CFR 563b.525(d)(1)–(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(6) ...... 12 CFR 563b.430(a), (b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(7)(i)–(ii) ...... 12 CFR 563b.25, 525(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.3(i)(7)(iii)–(iv) ...... Deleted. 12 CFR 563b.3(j) ...... 12 CFR 563b.5(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.4(a)(1) ...... 12 CFR 563b.120 ...... Nonsubstantive revision, moved. 12 CFR 563b.4(a)(2) ...... Deleted. 12 CFR 563b.4(a)(3) ...... 12 CFR 563b.125 ...... Nonsubstantive revision, moved. 12 CFR 563b.4(a)(3)(i)–(ii), (4)(i)–(xviii) ...... 12 CFR 563b.135(a), (b) ...... Nonsubstantive revision, moved. 12 CFR 563b.4(a)(4)(xix) ...... Deleted. VerDate 11 Original provision Re-proposed provision Comment 12 CFR 563b.4(a)(5) ...... 12 CFR 563b.135(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.4(b)(1)(i) ...... 12 CFR 563b.180 ...... Nonsubstantive revision, moved. 12 CFR 563b.4(b)(1)(ii) ...... 12 CFR 563b.185 ...... Nonsubstantive revision, moved. 12 CFR 563b.4(b)(2) ...... Deleted. 12 CFR 563b.4(b)(3) ...... 12 CFR 563b.180(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.4(c) ...... 12 CFR 563b.160 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(a) ...... 12 CFR 563b.250 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(b)–(c) ...... 12 CFR 563b.270(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(d)(1) ...... 12 CFR 563b.255 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(d)(2) ...... 12 CFR 563b.260, 265 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(d)(3) ...... 12 CFR 563b.255(h) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(d)(4) ...... 12 CFR 563b.260 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(e)(1)–(2) ...... 12 CFR 563b.150, 155 ...... Nonsubstantive revision, deletions, and moved. 12 CFR 563b.5(e)(3) ...... 12 CFR 563b.275(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(e)(4) ...... Deleted. 12 CFR 563b.5(e)(5) ...... 12 CFR 563b.150, 160(a)–(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(e)(6) ...... 12 CFR 563b.275(e) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(e)(7) ...... 12 CFR 563b.275(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(f) ...... 12 CFR 563b.280 ...... Nonsubstantive revision, moved. 12 CFR 563b.5(g)(1)–(2) ...... 12 CFR 563b.285(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.5(g)(3) ...... 12 CFR 563b.290 ...... Substantive revision, moved. 12 CFR 563b.5(h) ...... 12 CFR 563b.285(b) ...... Nonsubstantive revision, moved. 12 CFR 563b.6(a) ...... 12 CFR 563b.225(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.6(b) ...... 12 CFR 563b.230 ...... Nonsubstantive revision, moved. 12 CFR 563b.6(c)(1) ...... 12 CFR 563b.235 ...... Nonsubstantive revision, moved. 12 CFR 563b.6(c)(2) ...... Deleted. 12 CFR 563b.6(d) ...... 12 CFR 563b.225(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.6(e) ...... 12 CFR 563b.225(b)–(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(a)(1) ...... 12 CFR 563b.325(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(a)(2) ...... 12 CFR 563b.300(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(a)(3) ...... 12 CFR 563b.325(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(a)(4) ...... Deleted. 12 CFR 563b.7(b) ...... 12 CFR 563b.300(e), 305 ...... Nonsubstantive revision, moved. 12 CFR 563b.7(c) ...... 12 CFR 563b.330 ...... Nonsubstantive revision, moved. 12 CFR 563b.7(d) ...... 12 CFR 563b.200(b)(8), 300(c)–(d), Form OC, Nonsubstantive revision, moved. Item 3. 12 CFR 563b.7(e) ...... 12 CFR 563b.335(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(f)(1)–(2) ...... 12 CFR 563b.200(b) ...... Nonsubstantive revision, deletion, and moved. 12 CFR 563b.7(f)(3) ...... Deleted. 12 CFR 563b.7(g)(1)–(2) ...... 12 CFR 563b.335(a), Form OF, Items (1), (2) Nonsubstantial revisions, deletions, and moved. 12 CFR 563b.7(g)(3),(4),(5) ...... Form OF, Items (3), (4), (5) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(h) ...... 12 CFR 563b.345(a), 350(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(i) ...... 12 CFR 563b.400 ...... Nonsubstantive revision, moved. 12 CFR 563b.7(j) ...... 12 CFR 563b.350(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(k)(1)–(2) ...... 12 CFR 563b.405 ...... Nonsubstantive revision, moved. 12 CFR 563b.7(k)(2)(i)–(ii) ...... 12 CFR 563b.310(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(k)(3) ...... Deleted. 12 CFR 563b.7(k)(4) ...... 12 CFR 563b.310(a) ...... Nonsubstantive revision, moved. 12 CFR 563b.7(k)(5) ...... 12 CFR 563b.310(b)–(d) ...... Substantive revision, moved. 12 CFR 563b.8(a) ...... 12 CFR 563b.155 ...... Substantive revision, moved. 12 CFR 563b.8(b)(1)–(2) ...... 12 CFR 563b.150 ...... Nonsubstantive revision, moved. 12 CFR 563b.8(b)(3) ...... Deleted. 12 CFR 563b.8(c)(1)–(2)(i)–(ii) ...... 12 CFR 563b.240 ...... Nonsubstantive revision, moved. 12 CFR 563b.8(c)(2)(iii) ...... 12 CFR 563b.260 ...... Substantive revision, moved. 12 CFR 563b.8(c)(3) ...... 12 CFR 563b.300(a), (c) ...... Substantial revisions, deletions, and moved. 12 CFR 563b.8(d)(1)–(2) ...... 12 CFR 563b.430 ...... Nonsubstantive revision, moved. 12 CFR 563b.8(d)(3) ...... 12 CFR 563b.435 ...... Nonsubstantive revision, moved. 12 CFR 563b.8(e) ...... 12 CFR 563b.115(a), 155, 180(b), Form AC, Nonsubstantial revisions, deletions, and General Instruction B. moved. 12 CFR 563b.8(f) ...... Deleted. 12 CFR 563b.8(g) ...... Form AC, General Instruction B ...... Nonsubstantive revision, moved. 12 CFR 563b.8(h) ...... Deleted. 12 CFR 563b.8(i)–(l) ...... Form AC, General Instruction B ...... Nonsubstantive revision, moved. 12 CFR 563b.8(m) ...... Deleted. 12 CFR 563b.8(n) ...... Form AC, General Instruction B ...... Nonsubstantive revision, moved. 12 CFR 563b.8(o) ...... Deleted. 12 CFR 563b.8(p) ...... 12 CFR 563b.150(a)(6), Form AC, General In- Nonsubstantive revision, moved. struction B. 12 CFR 563b.8(q) ...... Form AC, General Instruction B ...... Nonsubstantive revision, moved. 12 CFR 563b.8(r) ...... Form AC, General Instruction B ...... Substantive revision, moved. 12 CFR 563b.8(s) ...... Form AC, General Instruction B ...... Nonsubstantive revision, moved. 12 CFR 563b.8(t)(1) ...... 12 CFR 563b.100 ...... Nonsubstantive revision, moved. VerDate 11 Original provision Re-proposed provision Comment 12 CFR 563b.8(t)(2) ...... Deleted. 12 CFR 563b.8(u) ...... 12 CFR 563b.205 ...... Nonsubstantial revisions, deletions, and moved. 12 CFR 563b.8(v) ...... 12 CFR 563b.530(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.9 ...... 12 CFR 563b.10 ...... Nonsubstantive revision, moved. 12 CFR 563b.10 ...... 12 CFR 563b.605(b)–(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.11 ...... 12 CFR 563b.200(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.20 ...... 12 CFR 563b.600 ...... Nonsubstantive revision, moved. 12 CFR 563b.21(a) ...... 12 CFR 563b.605 ...... Nonsubstantive revision, moved. 12 CFR 563b.21(b) ...... 12 CFR 563b.650, 610 ...... Nonsubstantive revision, moved. 12 CFR 563b.22 ...... Deleted. 12 CFR 563b.23(a)–(c) ...... 12 CFR 563b.670, 675 ...... Nonsubstantive revision, additions, and moved. 12 CFR 563b.23(d) ...... 12 CFR 563b.690 ...... Nonsubstantive revision, moved. 12 CFR 563b.24(a)–(b)(1), (3) ...... 12 CFR 563b.625(a)(1) ...... Nonsubstantive revision, moved. 12 CFR 563b.24(b)(2) ...... Deleted. 12 CFR 563b.24(c) ...... 12 CFR 563b.625(b) ...... Substantive addition, moved. 12 CFR 563b.25 ...... 12 CFR 563b.630 ...... Nonsubstantive revision, moved. 12 CFR 563b.26 ...... 12 CFR 563b.625(a)(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(a) ...... 12 CFR 563b.650 ...... Nonsubstantive revision, moved. 12 CFR 563b.27(b) ...... 12 CFR 563b.660(f)(1) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(c) ...... 12 CFR 563b.660(a)(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(d) ...... 12 CFR 563b.660(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(e) ...... 12 CFR 563b.660(g)(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(f)–(g) ...... 12 CFR 563b.660(e) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(h) ...... 12 CFR 563b.660(f)(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(i) ...... 12 CFR 563b.660(g)(1) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(j) ...... 12 CFR 563b.660(g)(3) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(k) ...... 12 CFR 563b.660(g)(4) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(l) ...... 12 CFR 563b.660(d)(3) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(m) ...... 12 CFR 563b.660(d)(2) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(n) ...... 12 CFR 563b.660(d)(1) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(o) ...... 12 CFR 563b.660(d)(4) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(p) ...... 12 CFR 563b.660(a)(3) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(q)–(r) ...... 12 CFR 563b.660(h) ...... Nonsubstantive revision, moved. 12 CFR 563b.27(s) ...... 12 CFR 563b.660(g)(5) ...... Nonsubstantive revision, moved. 12 CFR 563b.28 ...... 12 CFR 563b.610 ...... Nonsubstantive revision, moved. 12 CFR 563b.29(a) ...... 12 CFR 563b.660 ...... Nonsubstantive revision, moved. 12 CFR 563b.29(b) ...... Deleted. 12 CFR 563b.29(d)(1)–(2) ...... 12 CFR 563b.430 ...... Nonsubstantive revision, moved. 12 CFR 563b.29(d)(3) ...... 12 CFR 563b.435 ...... Nonsubstantive revision, moved. 12 CFR 563b.30 ...... 12 CFR 563b.675 ...... Nonsubstantive revision, moved. 12 CFR 563b.31 ...... 12 CFR 563b.680 ...... Nonsubstantive revision, moved. 12 CFR 563b.32 ...... 12 CFR 563b.670(c) ...... Nonsubstantive revision, moved. 12 CFR 563b.33 ...... 12 CFR 563b.670(d) ...... Nonsubstantive revision, moved. 12 CFR 563b.100 ...... Form AC—1680 ...... Nonsubstantive revision, moved. 12 CFR 563b.101 ...... Form PS—1681 ...... Nonsubstantive revision, moved. 12 CFR 563b.102 ...... Form OC—1682 ...... Nonsubstantive revision, moved...... 12 CFR 563b.15, 20, 105, 110, 115, 165 ...... New provisions. 12 CFR 563b.295 ...... New provision. 12 CFR 563b.550–575 ...... New provisions. Form OF—1683 ...... New form. VI. Request for Public Comment ‘‘significant regulatory action’’ for the Therefore, OTS includes the following purposes of Executive Order 12866. IRFA.19 OTS invites comment on all aspects of A description of the reasons why OTS VIII. Regulatory Flexibility Act the Re-proposal. We encourage is taking this action, and a statement of Analysis commenters to suggest modifications to the objectives of, and legal basis for, the approaches discussed above that could The Regulatory Flexibility Act of 1980 Re-proposal are in the supplementary meet OTS’s overall goal of improving (RFA) requires federal agencies to either material above. the conversion process. Because this is prepare an initial regulatory flexibility a re-proposal, OTS believes the public analysis (IRFA) with this Re-proposal or 1. Small Entities to Which the Re- comment period does not need to be as certify that the rule would not have a proposal Would Apply long as the First Proposal, therefore, significant impact on a substantial The Re-proposal applies to mutual OTS is publishing this Re-proposal with number of small entities.18 OTS cannot savings associations that propose to a 30-day comment period. at this time determine whether the rule convert to the stock form of ownership. VII. Executive Order 12866 would have a significant impact on a Under OTS jurisdiction, there are substantial number of small entities. currently approximately 399 mutual The Director of OTS determined that this Re-proposal does not constitute a 18 5 U.S.C. 605(b). 19 5 U.S.C. 603(a). VerDate 11 savings associations, 35 publicly traded documents may require legal or savings association, the account holders, MHCs, 2 non-publicly traded MHCs, professional help. OTS’s experience in or the public interest. This process will and 27 MHCs with no stock issued. Of the conversion process indicates that provide substantial flexibility to OTS these institutions, approximately 239 savings associations generally hire legal and the savings association to minimize have less than $100 million in assets. counsel, accountants, marketing agents, any significant economic impact of a Small depository institutions are and professional appraisers to assist in provision on a specific institution. generally defined, for RFA purposes, as completion of the necessary documents Nevertheless, OTS requests comments those with assets under $100 million.20 and forms. Savings associations on the burdens associated with the Re- In the past two years, OTS has converting under the current regulations proposal that particularly affect small processed 12 and 10 applications, spend approximately $250,000 to one savings associations, and whether any respectively, to convert from mutual to million dollars each to go through the modifications or exemptions from the stock or mutual holding company form. process. We note that the new rules for small savings associations Based on this experience, OTS believes requirements will add only 10 hours of would be appropriate. that the Re-proposal affects fewer than additional paperwork in preparation, 15 savings associations annually. and may save institutions that decide IX. Unfunded Mandates Act of 1995 after preliminary business plan 2. Requirements of the Re-Proposal Section 202 of the Unfunded preparation and discussion not to Mandates Reform Act of 1995, Pub. L. The Re-proposal requires mutual convert significant time and expense. 104–4 (Unfunded Mandates Act), savings associations wishing to convert See discussion infra at Section IX. The requires that an agency prepare a to stock form to prepare a plan of new requirement for information budgetary impact statement before conversion and other supporting forms supporting a proposed charitable promulgating a rule that includes a and documents (such as a business plan contribution should not increase these federal mandate that may result in and an independent appraisal) and costs appreciably. expenditure by state, local, and tribal submit the documents for OTS 3. Significant Alternatives governments, in the aggregate, or by the approval. The current mutual-to-stock private sector, of $100 million or more conversion regulations require all of Section 603(c) of the RFA requires in any one year. If a budgetary impact these documents or information. OTS to describe any significant statement is required, sec. 205 of the The Re-proposal includes a new alternatives to the Re-proposal that Unfunded Mandates Act also requires requirement that a savings association accomplish the stated objectives of the an agency to identify and consider a that intends to establish a charitable rule while minimizing any significant reasonable number of regulatory organization as part of its conversion economic impact of the rule on small alternatives before promulgating a rule. must supply certain documents and entities. Section 603(c) lists several OTS determined that the Re-proposal information regarding the charitable examples of significant alternatives, will not result in expenditures by state, organization. Under the current including (1) establishing different local, or tribal governments or by the application processing policies, OTS compliance or reporting requirements or often requires a savings association that timetables that take into account the private sector of $100 million or more intends to establish a charitable resources available to small entities; (2) in any one year. Accordingly, this organization as part of its conversion to clarifying, consolidating, or simplifying rulemaking is not subject to sec. 202 of submit the same type of information compliance and reporting requirements the Unfunded Mandates Act. that the Re-proposal would require. As for small entities; (3) using performance X. Paperwork Reduction Act a result, this new requirement should standards rather than design standards; not have any additional impact on small and (4) exempting small entities from The information collection savings associations. coverage of the rule or a part of the rule. requirements contained in the Re- The Re-proposal also adds demand After consideration, OTS does not proposal, 12 CFR part 563b, are virtually account holders to the definition of believe that any of these alternatives are identical to those included in the July savings account holders, allows feasible. As noted, more than half of the 2000 Proposed Rule on this subject. accelerated vesting in management savings associations to which the Re- OTS has modified the forms in only benefit plans for changes of control, and proposal could apply meet the RFA minor ways, but the burden on clarifies OTS policy regarding the standard for ‘‘small depository respondents remains unchanged from amount of proceeds allowed at the institutions.’’ In fact, the conversion those in the earlier rule, which the holding company level. None of these process is aimed largely at small Office of Management and Budget provisions, however, should add to the institutions that want to raise capital in (OMB) approved under control number reporting, recordkeeping, or compliance the open market by converting to the 1550–0014. Respondents/recordkeepers requirements for small entities. stock form of ownership. Given that the are not required to respond to any Although it is not clear that the RFA conversion process is designed with collection of information unless it requires a quantitative analysis of the small institutions in mind, modifying displays a currently valid OMB control impact of the re-proposed regulatory the requirements for such small number. changes, OTS provides the following institutions is not necessary. Moreover, As part of its continuing effort to estimate. The Re-proposal’s primary given that a conversion cannot be reduce paperwork and respondent economic impact on small savings measured for performance until it takes burden, however, OTS invites the associations relates to the expense of place, the use of performance standards public to comment on the information preparing the application to convert. rather than design standards is collections contained in this rule, Savings associations wishing to convert impractical. including the forms included in this must prepare the necessary documents To reduce regulatory burden publication as appendices. and forms, including a plan of consistent with the goals of this OTS invites comment on all of the conversion, a business plan, and an regulation, the Re-proposal specifically following issues: appraisal. Preparation of these permits OTS to waive any requirement • Whether the proposed information under the part where the waiver is collection contained in this Re-proposal 20 13 CFR 121.201, Division H (1999). equitable and not detrimental to the is necessary for the proper performance VerDate 11 of OTS’s functions, including whether 563b.10 May I form a holding company as 563b.275 How do I file revised proxy the information has practical utility. part of my conversion? materials? • The accuracy of OTS’s estimate of 563b.15 May I form a charitable 563b.280 Must I mail a member’s proxy the burden of the proposed information organization as part of my conversion? solicitation material? 563b.20 May I acquire another insured 563b.285 What solicitations are prohibited? collection. stock depository institution as part of my • Ways to enhance the quality, utility, 563b.290 What will OTS do if a solicitation conversion? violates these prohibitions? and clarity of the information to be 563b.25 What definitions apply to this part? 563b.295 Will OTS require me to re-solicit collected. proxies? • Ways to minimize the burden of the Subpart A—Standard Conversions information collection on respondents, Prior to Conversion Offering Circular including through the use of automated 563b.100 What must I do before a 563b.300 What must happen before OTS collection techniques or other forms of conversion? declares my offering circular effective? information technology. 563b.105 What information must I include 563b.305 When may I distribute the offering • Estimates of capital and start-up in my business plan? circular? costs of operation, maintenance, and 563b.110 Who must review my business 563b.310 When must I file a post-effective purchases of services to provide plan? amendment to the offering circular? 563b.115 How will OTS view my business Offers and Sales of Stock information. plan? Send comments on these information 563b.120 May I discuss my plans to convert 563b.320 Who has priority to purchase my collections to Information Collection with others? conversion shares? Comments, Attention: 1550–0014, by e- 563b.325 When may I offer to sell my mail to Plan of Conversion conversion shares? [email protected]; 563b.125 Must my board of directors adopt 563b.330 How do I price my conversion by facsimile transmission to (202) 906– a plan of conversion? shares? 563b.130 What must I include in my plan 563b.335 How do I sell my conversion 6518; or by mail to Information of conversion? Collection Comments, Chief Counsel’s shares? 563b.135 How do I notify my members that 563b.340 What sales practices are Office, Office of Thrift Supervision, my board of directors approved a plan of prohibited? 1700 G Street, NW., Washington, DC conversion? 563b.345 How may a subscriber pay for my 20552. OTS will post comments and the 563b.140 May I amend my plan of conversion shares? related index on the OTS Internet Site conversion? 563b.350 Must I pay interest on payments at www.ots.treas.gov. In addition, Filing Requirements for conversion shares? 563b.355 What subscription rights must I interested persons may inspect 563b.150 What must I include in my comments at the Public Reference give to each eligible account holder and application for conversion? each supplemental eligible account Room, 1700 G Street, NW., by 563b.155 How do I file my application for appointment. To make an appointment, holder? conversion? 563b.360 Are my officers, directors, and call (202) 906–5922, send an e-mail to 563b.160 May I keep portions of my their associates eligible account holders? [email protected], or send a application for conversion confidential? 563b.365 May other voting members facsimile transmission to Public 563b.165 How do I amend my application purchase conversion shares in the for conversion? Information at (202) 906–7755. conversion? 563b.370 Does OTS limit the aggregate List of Subjects Notice of Filing of Application and Comment Process purchases by officers, directors, and their 12 CFR Part 563b 563b.180 How do I notify the public that I associates? filed an application for conversion? 563b.375 How do I allocate my conversion Reporting and recordkeeping shares if my shares are oversubscribed? requirements, Savings associations, 563b.185 How may a person comment on my application for conversion? 563b.380 May my employee stock Securities. ownership plan purchase conversion OTS Review of the Application for shares? 12 CFR Part 574 Conversion 563b.385 May I impose any purchase Administrative practice and 563b.200 What actions may OTS take on limitations? procedure, Holding companies, my application? 563b.390 Must I provide a purchase Reporting and recordkeeping 563b.205 May a court review OTS’s final preference to persons in my local requirements, Savings associations, action on my conversion? community? 563b.395 What other conditions apply Securities. Vote by Members when I offer conversion shares in a 12 CFR Part 575 563b.225 Must I submit the plan of community offering, a public offering, or conversion to my members for approval? both? Administrative practice and 563b.230 Who is eligible to vote? Completion of the Offering procedure, Capital, Holding companies, 563b.235 How must I notify my members of Reporting and recordkeeping the meeting? 563b.400 When must I complete the sale of requirements, Savings associations, 563b.240 What must I submit to OTS after my stock? Securities. the members’ meeting? 563b.405 How do I extend the offering period? Accordingly, the Office of Thrift Proxy Solicitation Supervision proposes to amend 12 CFR 563b.250 Who must comply with these Completion of the Conversion chapter V, as set forth below: proxy solicitation provisions? 563b.420 When must I complete my 1. Part 563b is revised to read as 563b.255 What must the form of proxy conversion? follows: include? 563b.425 Who may terminate the 563b.260 May I use previously executed conversion? PART 563b—CONVERSIONS FROM proxies? 563b.430 What happens to my old charter? MUTUAL TO STOCK FORM 563b.265 How may I use proxies executed 563b.435 What happens to my corporate under this part? existence after conversion? Sec. 563b.270 What must I include in my proxy 563b.440 What voting rights must I provide 563b.5 What does this part do? statement? to stockholders after the conversion? VerDate 11 563b.445 What must I provide my savings OTS Review of the Voluntary Supervisory § 563b.15 May I form a charitable account holders? Conversion Application organization as part of my conversion? Liquidation Account 563b.670 Will OTS approve my voluntary When you convert to the stock form, supervisory conversion application? you may form a charitable organization. 563b.450 What is a liquidation account? 563b.675 What conditions will OTS impose Your contributions to the charitable 563b.455 What is the initial balance of the on an approval? liquidation account? organization are governed by the 563b.460 How do I determine the initial Offers and Sales of Stock requirements of §§ 563b.550 through balances of liquidation sub-accounts? 563b.680 How do I sell my shares? 563b.575. 563b.465 Do account holders retain any voting rights based on their liquidation Post-Conversion § 563b.20 May I acquire another insured stock depository institution as part of my sub-accounts? 563b.690 Who may not acquire additional conversion? 563b.470 Must I adjust liquidation sub- shares after the voluntary supervisory accounts? conversion? When you convert to stock form, you 563b.475 What is a liquidation? may acquire for cash or stock another 563b.480 Does the liquidation account Authority: 12 U.S.C. 1462, 1462a, 1463, 1464, 1467a, 2901; 15 U.S.C. 78c, 78l, insured depository institution that is affect my net worth? already in the stock form of ownership. 563b.485 What provision must I include in 78m,78n,78w. my new federal charter? 563b.5 What does this part do? § 563b.25 What definitions apply to this Post-Conversion (a) General. This part governs how a part? 563b.500 May I implement a stock option savings association (‘‘you’’) may convert The following definitions apply to plan or management or employee stock from the mutual to the stock form of this part and the forms prescribed under benefit plan? ownership. Subpart A of this part this part: 563b.505 May my directors, officers, and governs standard mutual-to-stock Acting in concert has the same their associates freely trade shares? conversions. Subpart B of this part meaning as in § 574.2(c) of this chapter. 563b.510 May I repurchase shares after governs voluntary supervisory mutual- The rebuttable presumptions of conversion? § 574.4(d) of this chapter, other than 563b.515 What information must I provide to-stock conversions. This part to OTS before I repurchase my shares? supersedes all inconsistent charter and §§ 574.4(d)(1) and (d)(2) of this chapter, 563b.520 May I declare or pay dividends bylaw provisions of federal savings apply to the share purchase limitations after I convert? associations converting to stock form. at §§ 563b.355 through 563b.395. 563b.525 Who may acquire my shares after (b) Prescribed forms. You must use Affiliate of, or a person affiliated with, I convert? the forms prescribed under this part and a specified person, is a person that 563b.530 What other requirements apply provide such information as OTS may directly or indirectly, through one or after I convert? require under the forms by regulation or more intermediaries, controls, is Contributions to Charitable Organizations otherwise. The forms required under controlled by, or is under common 563b.550 May I donate conversion shares or this part include: Form AC (Application control with the specified person. conversion proceeds to a charitable for Conversion); Form PS (Proxy Associate of a person is: organization? Statement); Form OC (Offering Circular); (1) A corporation or organization 563b.555 How do my members approve a and Form OF (Order Form). (other than you or your majority-owned charitable contribution? (c) Waivers. OTS may waive any subsidiaries), if the person is a senior 563b.560 How much may I contribute to a requirement of this part or a provision officer or partner, or beneficially owns, charitable organization? in any prescribed form. To obtain a directly or indirectly, 10 percent or 563b.565 What must the charitable more of any class of equity securities of organization include in its organizational waiver, you must file a written request documents? with OTS that: the corporation or organization. 563b.570 How do I address conflicts of (1) Specifies the requirement(s) or (2) A trust or other estate, if the interest involving my directors? provision(s) you want OTS to waive; person has a substantial beneficial 563b.575 What other requirements apply to (2) Demonstrates that the waiver is interest in the trust or estate or is a charitable organizations? equitable, is not detrimental to you, trustee or fiduciary of the trust or estate. Subpart B—Voluntary Supervisory your account holders or other savings For purposes of §§ 563b.370, 563b.380, Conversion associations, and is not contrary to the 563b.385, 563b.390, 563b.395 and 563b.505, a person who has a 563b.600 What does this subpart do? public interest; and 563b.605 How may I conduct a voluntary (3) Includes an opinion of counsel substantial beneficial interest in your supervisory conversion? demonstrating that applicable law does tax-qualified or non-tax-qualified 563b.610 Do my members have rights in a not conflict with the requirement or employee stock benefit plan, or who is voluntary supervisory conversion? provision. a trustee or a fiduciary of the plan, is not Eligibility an associate of the plan. For the § 563b.10 May I form a holding company purposes of § 563b.370, your tax- as part of my conversion? 563b.625 When is a savings association qualified employee stock benefit plan is eligible for a voluntary supervisory You may convert to the stock form of not an associate of a person. conversion? ownership as part of a transaction where 563b.630 When is a BIF-insured state- (3) Any person who is related by chartered savings bank eligible for a you organize a holding company to blood or marriage to such person and: voluntary supervisory conversion? acquire all of your shares upon their (i) Who lives in the same home as the issuance. In such a transaction, your person; or Plan of Supervisory Conversion holding company will offer rights to (ii) Who is your director or senior 563b.650 What must I include in my plan purchase its shares instead of your officer, or a director or senior officer of of voluntary supervisory conversion? shares. All of the requirements of your holding company or your Voluntary Supervisory Conversion subpart A generally apply to the holding subsidiary. Application company as they apply to the savings Association members or members are 563b.660 What must I include in my association. Section 574.6 of this persons who, under applicable law, are voluntary supervisory conversion chapter contains OTS’s holding eligible to vote at the meeting on application? company application requirements. conversion. VerDate 11 Control (including controlling, Savings account is any withdrawable Subpart A—Standard Conversions controlled by, and under common account as defined in § 561.42 of this control with) means the direct or chapter, including a demand account as Prior to Conversion indirect power to direct or exercise a defined in § 561.16 of this chapter. § 563b.100 What must I do before a controlling influence over the Solicitation and solicit is a request for conversion? management and policies of a person, a proxy, whether or not accompanied by (a) You must meet with OTS at least whether through the ownership of or included in a form of proxy; a request ten days before you pass your plan of voting securities, by contract, or to execute, not execute, or revoke a conversion. At that meeting you must otherwise as described at 12 CFR part proxy; or the furnishing of a form of provide OTS with a written strategic 574. proxy or other communication plan that outlines the objectives of the Eligibility record date is the date for reasonably calculated to cause your proposed conversion and the intended determining eligible account holders. members to procure, withhold, or use of the conversion proceeds. The eligibility record date must be at revoke a proxy. Solicitation or solicit (b) You should also consult with OTS least one year before the date your board does not include providing a form of before you file your application for of directors adopts the plan of proxy at the unsolicited request of a conversion. OTS will discuss the conversion. member, the acts required to mail information that you must include in Eligible account holders are any communications for members, or the application for conversion, general persons holding qualifying deposits on ministerial acts performed on behalf of issues that you may confront in the the eligibility record date. a person soliciting a proxy. conversion process, and any other IRS is the Internal Revenue Service. pertinent issues. Local community includes: Subscription offering is the offering of shares through nontransferable § 563b.105 What information must I (1) Every county, parish, or similar subscription rights to: include in my business plan? governmental subdivision in which you have a home or branch office; (1) Eligible account holders under (a) Prior to filing an application for conversion, you must adopt a business (2) Each county’s, parish’s, or § 563b.355; plan reflecting your intended plans for subdivision’s metropolitan statistical (2) Tax-qualified employee stock deployment of the proposed conversion area; ownership plans under § 563b.380; proceeds. Your business plan is (3) All zip code areas in your (3) Supplemental eligible account required, under § 563b.150, to be Community Reinvestment Act holders under § 563b.355; and included in your conversion assessment area; and application. At a minimum, your (4) Any other area or category you set (4) Other voting members under § 563b.365. business plan must address: out in your plan of conversion, as (1) Your projected operations and approved by OTS. Supplemental eligibility record date is activities for three years following the Offer, offer to sell, or offer for sale is the date for determining supplemental conversion. You must describe how you an attempt or offer to dispose of, or a eligible account holders. The will deploy the conversion proceeds at solicitation of an offer to buy, a security supplemental eligibility record date is the converted savings association (and or interest in a security for value. the last day of the calendar quarter holding company, if applicable), and Preliminary negotiations or agreements before OTS approves your conversion include three years of projected with an underwriter, or among and will only occur if OTS has not financial statements. The business plan underwriters who are or will be in approved your conversion within 15 must provide that the converted savings privity of contract with you, are not months after the eligibility record date. association must retain at least 50 offers, offers to sell, or offers for sale. Supplemental eligible account percent of the net conversion proceeds. Person is an individual, a corporation, holders are any persons, except your OTS may require that a larger a partnership, an association, a joint- officers, directors, and their associates, percentage of proceeds remain in the stock company, a limited liability holding qualifying deposits on the institution. company, a trust, an unincorporated supplemental eligibility record date. (2) Your plan for deploying organization, or a government or conversion proceeds to meet credit and Tax-qualified employee stock benefit political subdivision of a government. lending needs in your proposed market plan is any defined benefit plan or Proxy soliciting material includes a areas. OTS strongly discourages defined contribution plan, such as an proxy statement, form of proxy, or other business plans that provide for a employee stock ownership plan, stock written or oral communication substantial investment in mortgage bonus plan, profit-sharing plan, or other regarding the conversion. securities or other securities, except as plan, and a related trust, that is Purchase or buy includes every an interim measure to facilitate orderly, qualified under section 401 of the contract to acquire a security or interest prudent deployment of proceeds during Internal Revenue Code (26 U.S.C. 401). in a security for value. the three years following the Qualifying deposit is the total balance Underwriter is any person who conversion, or as part of a properly in an account holder’s savings accounts purchases any securities from you with managed leverage strategy. at the close of business on the eligibility a view to distributing the securities, (3) How the new capital will support or supplemental eligibility record date. offers or sells securities for you in projected operations and activities, and Your plan of conversion may provide connection with the securities’ what opportunities are available to that only savings accounts with total distribution, or participates or has a reasonably achieve your planned deposit balances of $50 or more will direct or indirect participation in the deployment of conversion proceeds in qualify. direct or indirect underwriting of any your proposed market areas. Sale or sell includes every contract to such undertaking. Underwriter does not (4) The risks associated with your dispose of a security or interest in a include a person whose interest is plan for deployment of conversion security for value. An exchange of limited to a usual and customary proceeds, and the effect of this plan on securities in a merger or acquisition distributor’s or seller’s commission from management resources, staffing, and approved by OTS is not a sale. an underwriter or dealer. facilities. VerDate 11 (5) The expertise of your management (b) Except as permitted under (1) Your board of directors adopted a and board of directors, or that you have paragraph (a) of this section, you must proposed plan to convert from a mutual planned for adequate staffing and keep all information about your to a stock savings institution. controls to prudently manage the conversion confidential until your board (2) You will send your members a growth, expansion, new investment, and of directors adopts your plan of proxy statement with detailed other operations and activities proposed conversion. information on the proposed conversion in your business plan. (c) If you violate this section, OTS before you convene a members’ meeting (6) How you will achieve a reasonable may require you to take remedial action. to vote on the conversion. return on equity, commensurate with For example, OTS may require you to (3) Your members will have an investment risk, investor expectations, take any or all of the following actions: opportunity to approve or disapprove and industry norms, by the final year of (1) Publicly announce that you are the proposed conversion at a meeting. the business plan. considering a conversion; At least a majority of the eligible votes (b) You may not project returns of (2) Set an eligibility record date must approve the conversion. capital or extraordinary dividends in acceptable to OTS; (4) You will not vote existing proxies any part of the business plan. A newly (3) Limit the subscription rights of to approve or disapprove the converted company should not plan on any person who violates or aids a conversion. You will solicit new proxies stock repurchases in the first year of the violation of this section; or for voting on the proposed conversion. business plan, except in extraordinary (4) Take any other action to assure (5) OTS, and in the case of a state- circumstances. that your conversion is fair and chartered savings association, the equitable. appropriate state regulator, must § 563b.110 Who must review my business plan? Plan of Conversion approve the conversion before the conversion will be effective. Your (a) Your chief executive officer and § 563b.125 Must my board of directors members will have an opportunity to members of the board of directors must adopt a plan of conversion? file written comments, including review, and at least two-thirds of your Prior to filing an application for objections and materials supporting the board must approve, the business plan. conversion, your board of directors must (b) Your chief executive officer and at objections, with OTS. adopt a plan of conversion that (6) The IRS must issue a favorable tax least two-thirds of the board must conforms to §§ 563b.320 through ruling, or a tax expert must issue an certify that the business plan accurately 563b.395 (‘‘Offers and Sales of Stock’’). appropriate tax opinion, on the tax reflects the intended plans for Your board of directors must adopt the consequences of your conversion before deployment of conversion proceeds, and plan by at least a two-thirds vote. Your OTS will approve the conversion. The that any new initiatives reflected in the plan of conversion is required, under ruling or opinion must indicate the business plan are reasonably achievable. § 563b.150, to be included in your conversion will be a tax-free You must submit these certifications conversion application. reorganization. with your business plan, as part of your (7) OTS, and in the case of a state- conversion application under § 563b.130 What must I include in my plan chartered savings association, the § 563b.150. of conversion? You must include the information appropriate state regulator, might not § 563b.115 How will OTS view my included in §§ 563b.320 through approve the conversion, and the IRS or business plan? 563b.395 (‘‘Offers and Sales of Stock’’) a tax expert might not issue a favorable (a) OTS will review your business in your plan of conversion. OTS may tax ruling or tax opinion. plan to determine that it demonstrates require you to delete or revise any (8) Savings account holders will prudent deployment of conversion provision in your plan of conversion if continue to hold accounts in the proceeds, as part of its review of your OTS determines the provision is converted savings association with the conversion application. In making its inequitable; is detrimental to you, your same dollar amounts, rates of return, determination, OTS will consider how account holders, or other savings and general terms as existing deposits. you have addressed the requirements of associations; or is contrary to public FDIC will continue to insure the § 563b.105 in the aggregate, and not as interest. accounts. individual criteria. (9) Your conversion will not affect (b) You must file your business plan § 563b.135 How do I notify my members borrowers’ loans, including the amount, with the Regional Office. OTS may that my board of directors approved a plan rate, maturity, security, and other request additional information, if of conversion? contractual terms. necessary, to support its determination (a) Notice. You must promptly notify (10) Your business of accepting under paragraph (a) of this section. You your members that your board of deposits and making loans will continue must also file your business plan as a directors adopted a plan of conversion without interruption. confidential exhibit to the Form AC. and that a copy of the plan is available (11) Your current management and (c) If OTS approves your application for the members’ inspection in your staff will continue to conduct current for conversion and you complete your home office and in your branch offices. services for depositors and borrowers conversion, you must operate within the You must mail a letter to each member under current policies and in existing parameters of your business plan. You or publish a notice in the local offices. must obtain the prior written approval newspaper in every local community (12) You may continue to be a of the Regional Director for any material where you have an office. You may also member of the Federal Home Loan Bank deviations from your business plan. issue a press release. OTS may require System. broader publication, if necessary, to (13) You may substantively amend § 563b.120 May I discuss my plans to ensure adequate notice to your your proposed plan of conversion before convert with others? members. the members’ meeting. (a) You may discuss information (b) Contents of notice. You may (14) You may terminate the proposed about your conversion with individuals include any of the following statements conversion. that you authorize to prepare documents and descriptions in your letter, notice, (15) After OTS, and in the case of a for your conversion. or press release. state-chartered savings association, the VerDate 11 appropriate state regulator, approves the (5) The documents and information § 563b.165 How do I amend my application proposed conversion, you will send required by Form AC. You may obtain for conversion? proxy materials providing additional Form AC from OTS Washington and To amend your application for information. After you send proxy Regional Offices (see § 516.40 of this conversion, you must: materials, members may telephone or chapter) and OTS’s website (a) File an amendment with an write to you with additional questions. (www.ots.treas.gov). appropriate facing sheet; (16) The proposed record date for (6) Where indicated, written consents, (b) Number each amendment determining the eligible account holders signed and dated, of any accountant, consecutively; who are entitled to receive subscription attorney, investment banker, appraiser, (c) Respond to all issues raised by rights to purchase your shares. or other professional who prepared, OTS; and (17) A brief description of the reviewed, passed upon, or certified any (d) Demonstrate that the amendment circumstances under which statement, report, or valuation for use. conforms to all applicable regulations. supplemental eligible account holders See Form AC, instruction B(7). Notice of Filing of Application and will receive subscription rights to (7) Your business plan, submitted as Comment Process purchase your shares. (18) A brief description of how voting a separately bound, confidential exhibit. See § 563b.160. § 563b.180 How do I notify the public that members may participate in the I filed an application for conversion? (8) Any additional information OTS conversion. (a) You must publish a public notice requests. (19) A brief description of how of the application under the procedures directors, officers, and employees will (b) OTS will not accept for filing, and in § 516.55 of this chapter, except that participate in the conversion. will return, any application for you must publish your notice within (20) A brief description of the conversion that is improperly executed, three days before or after you file your proposed plan of conversion. materially deficient, substantially application for conversion. You must (21) The par value (if any) and incomplete, or that provides for simultaneously prominently post the approximate number of shares you will unreasonable conversion expenses. notice in your home office and all issue and sell in the conversion. (c) Other requirements. (1) You may § 563b.155 How do I file my application for branch offices. Your notice must not solicit proxies, provide financial conversion? include the following information: (1) You filed an application for statements, describe the benefits of You must file seven copies of your conversion, or estimate the value of application for conversion on Form AC. conversion with OTS; (2) You delivered copies of the your shares upon conversion in the You must file the original and three application to OTS and to the Regional letter, notice, or press release. conformed copies with the Applications Office, including the addresses of the (2) If you respond to inquiries about Filing Room in Washington, and three applicable OTS offices; and the conversion, you may address only conformed copies with the appropriate (3) A statement that anyone may file the matters listed in paragraph (b) of Regional Office at the addresses in written comments, including objections this section. § 516.40 of this chapter. to the plan of conversion and materials § 563b.140 May I amend my plan of § 563b.160 May I keep portions of my supporting the objections, within 20 conversion? application for conversion confidential? days. You must include instructions You may amend your plan of (a) OTS makes all filings under this regarding how a person may file a conversion before you solicit proxies. part available to the public, but may comment. After you solicit proxies, you may keep portions of your application for (b) Promptly after publication, you amend your plan of conversion only if conversion confidential under must file four copies of any public OTS concurs. paragraph (b) of this section. notice and an affidavit of publication from each publisher. You must file the (b) You may request OTS to keep Filing Requirements original and one copy with the portions of your application Applications Filing Room in § 563b.150 What must I include in my confidential. To do so, you must application for conversion? Washington, and two copies with the separately bind and clearly designate as appropriate Regional Office at the (a) Your application for conversion ‘‘confidential’’ any portion of your addresses in § 516.40 of this chapter. must include all of the following application for conversion that you information. (c) If OTS does not accept your deem confidential. You must provide a application for conversion under (1) Your plan of conversion. written statement specifying the (2) Pricing materials meeting the § 563b.200 and requires you to file a grounds supporting your request for requirements of § 563b.200(b). new application, you must publish and (3) Proxy soliciting materials under confidentiality. OTS will not treat as post a new notice and allow an § 563b.270, including: confidential the portion of your additional 20 days for comment. (i) A preliminary proxy statement application describing how you plan to with signed financial statements; meet your Community Reinvestment § 563b.185 How may a person comment on (ii) A form of proxy meeting the Act (CRA) objectives. The CRA portion my application for conversion? requirements of § 563b.255; and of your application may not incorporate Anyone may submit a written (iii) Any additional proxy soliciting by reference information contained in comment supporting or opposing your materials, including press releases, the confidential portion of your application for conversion with OTS. To personal solicitation instructions, radio application. do so, commenters must file within 20 or television scripts that you plan to use (c) OTS will determine whether days after you notify the public under or furnish to your members, and a legal confidential information must be made § 563b.180. A commenter must file the opinion indicating that any marketing available to the public under 5 U.S.C. original and one copy of any comments materials comply with all applicable 552 and part 505 of this chapter. OTS with the Applications Filing Room in securities laws. will advise you before it makes Washington, and two copies with the (4) An offering circular described in information you designated as appropriate Regional Office at the § 563b.300. ‘‘confidential’’ available to the public. addresses in § 516.40 of this chapter. VerDate 11 OTS Review of the Application for and your business plan to determine (c) Your members may vote in person Conversion how you will serve the convenience and or by proxy. needs of your communities after the (d) You may notify eligible account § 563b.200 What actions may OTS take on holders or supplemental eligible my application? conversion. (1) Based on this review, OTS may account holders who are not voting (a) OTS may approve your application approve your application, deny your members of your proposed conversion. for conversion only if: application, or approve your application You may include only the information (1) Your conversion complies with in § 563b.135 in your notice. this part; on the condition that you will improve your CRA performance or that you will (2) You will meet your regulatory § 563b.230 Who is eligible to vote? capital requirements under part 567 of address the particular credit or lending needs of the communities that you will You determine members’ eligibility to this chapter after the conversion; and vote by setting a voting record date. You (3) Your conversion will not result in serve. must set a voting record date that is not a taxable reorganization under the (2) OTS may deny your application if more than 60 days nor less than 20 days Internal Revenue Code of 1986, as your business plan does not before your meeting, unless you are a amended. demonstrate that your proposed use of (b) OTS will review the appraisal conversion proceeds will help you to state-chartered savings association and required by § 563b.150(a)(2) in meet the credit and lending needs of the state law requires a different voting determining whether to approve your communities that you will serve. record date. application. OTS will review the (d) OTS may request that you amend § 563b.235 How must I notify my members appraisal under the following your application if further explanation of the meeting? requirements. is necessary, material is missing, or (a) You must notify your members of (1) Independent persons experienced material must be corrected. the meeting to consider your conversion and expert in corporate appraisal, and (e) OTS will deny your application if by sending the members a proxy acceptable to OTS, must prepare the the application does not meet the statement authorized by OTS. appraisal report. requirements of this subpart, unless (b) You must notify your members 20 (2) An affiliate of the appraiser may OTS waives the requirement under to 45 days before your meeting, unless serve as an underwriter or selling agent, § 563b.5(c). you are a state-chartered savings if you ensure that the appraiser is association and state law requires a separate from the underwriter or selling § 563b.205 May a court review OTS’s final different notice period. agent affiliate and the underwriter or action on my conversion? (c) You must also notify each selling agent affiliate does not make (a) Any person aggrieved by OTS’s beneficial holder of an account held in recommendations or affect the final action on your application for a fiduciary capacity: appraisal. conversion may ask the court of appeals (1) If you are a federal association and (3) The appraiser may not receive any of the United States for the circuit in the name of the beneficial holder is fee in connection with the conversion which the principal office or residence disclosed on your records; or other than for appraisal services. of such person is located, or the U.S. (2) If you are a state-chartered (4) The appraisal report must include Court of Appeals for the District of association and the beneficial holder a complete and detailed description of Columbia Circuit, to review the action possesses voting rights under state law. the elements of the appraisal, a under 12 U.S.C. 1464(i)(2)(B). justification for the appraisal (b) To obtain court review of the § 563b.240 What must I submit to OTS methodology, and sufficient support for action, this statute requires the after the members’ meeting? the conclusions. aggrieved person to file a written Promptly after the members’ meeting, (5) If the appraisal is based on a petition requesting that the court you must file all of the following capitalization of your pro forma income, modify, terminate, or set aside the final information with OTS: it must indicate the basis for OTS action. The aggrieved person must (a) A certified copy of each adopted determining the income to be derived file the petition with the court within resolution on the conversion. from the sale of shares, and demonstrate the later of 30 days after OTS publishes (b) The total votes eligible to be cast. that the earnings multiple used is notice of OTS’s final action in the (c) The total votes represented in appropriate, including future earnings Federal Register or 30 days after you person or by proxy. growth assumptions. mail the proxy statement to your (6) If the appraisal is based on a (d) The total votes cast in favor of and members under § 563b.235. comparison of your shares with against each matter. outstanding shares of existing stock Vote by Members (e) The percentage of votes necessary associations, the existing stock to approve each matter. associations must be reasonably § 563b.225 Must I submit the plan of (f) An opinion of counsel that you conversion to my members for approval? comparable in size, market area, conducted the members’ meeting in competitive conditions, risk profile, (a) After OTS approves your plan of compliance with all applicable state or profit history, and expected future conversion, you must submit your plan federal laws and regulations. earnings. of conversion to your members for (g) Promptly after completion of the (7) OTS may decline to process the approval. You must obtain this approval conversion, you must submit an opinion application for conversion and deem it at a special meeting, unless you are a of counsel that you complied with all materially deficient or substantially state-chartered savings association and laws applicable to the conversion. incomplete if the initial appraisal report state law requires you to obtain Proxy Solicitation is materially deficient or substantially approval at an annual meeting. incomplete. (b) Your members must approve your § 563b.250 Who must comply with these (8) You may not represent or imply plan of conversion by a majority of the proxy solicitation provisions? that OTS approved the appraisal. total outstanding votes, unless you are (a) You must comply with these proxy (c) OTS will review your compliance a state-chartered savings association and solicitation provisions when you record under part 563e of this chapter state law prescribes a higher percentage. provide proxy solicitation material to VerDate 11 members for the meeting to vote on your conversion at an annual meeting, you request members to sign and return plan of conversion. may vote proxies obtained through other proxy forms. (b) Your members must comply with proxy solicitations only on matters not these proxy solicitation provisions related to your plan of conversion. § 563b.280 Must I mail a member’s proxy solicitation material? when they provide proxy solicitation materials to members for the meeting to § 563b.265 How may I use proxies (a) You must mail the member’s executed under this part? vote on your conversion, except where: authorized proxy solicitation material if: (1) The member solicits 50 people or You may vote a proxy obtained under (1) Your board of directors adopted a fewer and does not solicit proxies on this part on matters that are incidental plan of conversion; (2) A member requests in writing that your behalf; or to the conduct of the meeting. You may not vote a proxy obtained under this you mail proxy solicitation material; (2) The member solicits proxies (3) OTS has authorized the member’s through newspaper advertisements after subpart at any meeting other than the meeting (or any adjournment of the proxy solicitation; and your board adopts the plan of (4) The member agrees to defray your conversion. The newspaper meeting) to vote on your plan of conversion. reasonable expenses. advertisement may include only the (b) As soon as practicable after you following information: § 563b.270 What must I include in my receive a request under paragraph (a) of (i) Your name; proxy statement? this section, you must mail or otherwise (ii) The reason for the advertisement; (a) Content requirements. You must furnish the following information to the (iii) The proposal or proposals to be prepare your proxy statement in member: voted upon; compliance with this part and Form PS. (1) The approximate number of (iv) Where a member may obtain a You may obtain Form PS from OTS members that you solicited or will copy of the proxy solicitation material; Washington and Regional Offices (see solicit, or the approximate number of and § 516.40 of this chapter) and OTS’s members of any group of account (v) A request for your members to vote website (http://www.ots.treas.gov). holders that the member designates; and at the meeting. (b) Other requirements. (1) OTS will (2) The estimated cost of mailing the § 563b.255 What must the form of proxy review your proxy solicitation material proxy solicitation material for the include? when it reviews the application for member. (c) You must mail authorized proxy The form of proxy must include all of conversion and will authorize the use of solicitation material to the designated the following: proxy solicitation material. members promptly after the member (a) A statement in bold face type (2) You must provide an authorized furnishes the materials, envelopes (or stating whether management is written proxy statement to your other containers), and postage (or soliciting the proxy. members before or at the same time you payment for postage) to you. (b) Blank spaces where the member provide any other soliciting material. You must mail authorized proxy (d) You are not responsible for the must date and sign the proxy. content of a member’s proxy solicitation (c) Clear and impartial identification solicitation material to your members within ten days after OTS authorizes the material. of each matter or group of related (e) A member may furnish other solicitation. matters that members will vote upon. members its own proxy solicitation You must include any proposed § 563b.275 How do I file revised proxy material, authorized by OTS, subject to charitable contribution as an item to be materials? the rules in this section. voted on separately. (d) The phrase ‘‘Revocable Proxy’’ in (a) You must file revised proxy § 563b.285 What solicitations are bold face type (at least 18 point). materials as an amendment to your prohibited? application for conversion. See (e) A description of any charter or (a) False or misleading statements. (1) § 563b.155 for where to file. state law requirement that restricts or No one may use proxy solicitation (b) To revise your proxy solicitation conditions votes by proxy. material for the members’ meeting if the materials, you must file: (f) An acknowledgment that the material contains any statement which, (1) Seven copies of your revised proxy member received a proxy statement considering the time and the materials as required by Form PS; before he or she signed the form of circumstances of the statement: proxy. (2) Seven copies of your revised form (i) Is false or misleading with respect (g) The date, time, and the place of the of proxy, if applicable; and to any material fact; meeting, when available. (3) Seven copies of any additional (ii) Omits any material fact that is (h) A way for the member to specify proxy solicitation material subject to necessary to make the statements not by ballot whether he or she approves or § 563b.270. false or misleading; or disapproves of each matter that (c) You must mark four of the seven (iii) Omits any material fact that is members will vote upon. required copies to clearly indicate necessary to correct a statement in an (i) A statement that management will changes from the prior filing. earlier communication that has become vote the proxy in accordance with the (d) You must file seven definitive false or misleading. member’s specifications. copies of all proxy solicitation material, (2) No one may represent or imply (j) A statement in bold face type in the form in which you furnish the that OTS determined that the proxy indicating how management will vote material to your members. You must file solicitation material is accurate, the proxy if the member does not no later than the date that you send or complete, not false or not misleading, or specify a choice for a matter. give the proxy solicitation material to passed upon the merits of or approved your members. You must indicate the any proposal. § 563b.260 May I use previously executed date that you will release the materials. (b) Other prohibited solicitations. No proxies? (e) Unless OTS requests you to do so, person may solicit: You may not use previously executed you do not have to file copies of replies (1) An undated or post-dated proxy; proxies for the plan of conversion vote. to inquiries from your members or (2) A proxy that states it will be dated If members consider your plan of copies of communications that merely after the date it is signed by a member; VerDate 11 (3) A proxy that is not revocable at You must distribute the offering circular (d) If OTS permits, you may increase will by the member; or in accordance with this part. the maximum price of conversion shares (4) A proxy that is part of another (c) You must distribute your offering sold. The maximum price, as adjusted, document or instrument. circular to persons listed in your plan of must be no more than 15 percent above conversion within 10 days after OTS the maximum price computed under § 563b.290 What will OTS do if a declares it effective. paragraph (b) of this section. solicitation violates these prohibitions? (e) The maximum price must be § 563b.310 When must I file a post- (a) If a solicitation violates § 563b.285, between $5 and $50 per share. OTS may require remedial measures, effective amendment to the offering circular? (f) You must include the estimated including: price in any preliminary offering (a) You must file a post-effective (1) Correction of the violation by a circular. retraction and a new solicitation; amendment to the offering circular with (2) Rescheduling the members’ OTS when a material event or change of § 563b.335 How do I sell my conversion meeting; or circumstance occurs. shares? (3) Any other actions necessary to (b) After OTS declares the post- (a) You must distribute order forms to ensure a fair vote. effective amendment effective, you must all eligible account holders, (b) OTS may also bring an immediately deliver the amendment to supplemental eligible account holders, enforcement action against the violator. each person who subscribed for or and other voting members to enable ordered shares in the offering. them to subscribe for the conversion § 563b.295 Will OTS require me to re- (c) Your post-effective amendment shares they are permitted under the plan solicit proxies? must indicate that each person may of conversion. You may either send the If you amend your application for increase, decrease, or rescind their order forms with your offering circular conversion, OTS may require you to re- subscription or order. or after you distribute your offering solicit proxies for your members’ (d) The post-effective offering period circular. meeting as a condition of approval of must remain open no less than 10 days (b) You may sell your conversion the amendment. nor more than 20 days, unless OTS shares in a community offering, a public approves a longer rescission period. Offering Circular offering, or both. You may begin the Offers and Sales of Stock community offering, the public offering, § 563b.300 What must happen before OTS or both at any time during the declares my offering circular effective? § 563b.320 Who has priority to purchase subscription offering or upon (a) You must prepare and file your my conversion shares? conclusion of the subscription offering. offering circular with OTS in You must offer to sell your shares in (c) You may pay underwriting compliance with this part and Form OC the following order: commissions (including underwriting and, where applicable, part 563g of this (a) Eligible account holders. discounts). OTS may object to the chapter. Section 563b.155 governs (b) Tax-qualified employee stock payment of unreasonable commissions. where to file your offering circular. You ownership plans. You may reimburse an underwriter for may obtain Form OC from OTS (c) Supplemental eligible account accountable expenses in a subscription Washington and Regional Offices (see holders. offering if the public offering is limited. § 516.40 of this chapter) and OTS’s (d) Other voting members who have If no public offering occurs, you may website (http://www.ots.treas.gov). subscription rights. pay an underwriter a consulting fee. (e) Your community, your community (b) You must condition your stock OTS may object to the payment of and the general public, or the general offering upon the members’ approval of unreasonable consulting fees. public. your plan of conversion. (d) If you conduct the community (c) OTS will review the Form OC and § 563b.325 When may I offer to sell my offering, the public offering, or both at may comment on the included conversion shares? the same time as the subscription disclosures and financial statements. (a) You may offer to sell your offering, you must fill all subscription (d) You must file seven copies of each conversion shares after OTS approves orders first. revised offering circular, final offering your conversion, authorizes your proxy (e) You must prepare your order form circular, and any post-effective statement, and declares your offering in compliance with this part and Form amendment to the final offering circular. circular effective. OF. You may obtain Form OF from OTS (e) OTS will not approve the (b) The offer may commence at the Washington and Regional Offices (see adequacy or accuracy of the offering same time you start the proxy § 516.40 of this chapter) and OTS’s circular or the disclosures. solicitation of your members. website (http://www.ots.treas.gov). (f) After you satisfactorily address OTS’s concerns, you must request OTS § 563b.330 How do I price my conversion § 563b.340 What sales practices are prohibited? to declare your Form OC effective for a shares? time period. The time period may not (a) You must sell your conversion (a) In connection with offers, sales, or exceed the maximum time period for shares at a uniform price per share and purchases of conversion shares under the completion of the sale of all of your at a total price that is equal to the this part, you and your directors, shares under § 563b.400. estimated pro forma market value of officers, agents, or employees may not: your shares after you convert. (1) Employ any device, scheme, or § 563b.305 When may I distribute the (b) The maximum price must be no artifice to defraud; offering circular? more than 15 percent above the (2) Obtain money or property by (a) You may distribute a preliminary midpoint of the estimated price range in means of any untrue statement of a offering circular at the same time as or your offering circular. material fact or any omission of a after you mail the proxy statement to (c) The minimum price must be no material fact necessary to make the your members. more than 15 percent below the statements, in light of the circumstances (b) You may not distribute an offering midpoint of the estimated price range in under which they were made, not circular until OTS declares it effective. your offering circular. misleading; or VerDate 11 (3) Engage in any act, transaction, requirement because he or she and the public offering under practice, or course of business that withdraws money from a certificate of § 563b.395; or operates or would operate as a fraud or deposit to purchase conversion shares, (2) One-tenth of one percent of the deceit upon a purchaser or seller. you may cancel the certificate and pay total stock offering. (b) During your conversion, no person interest at no less than your passbook (b) You must subordinate the voting may: rate on any remaining balance. members’ rights to the rights of eligible (1) Transfer, or enter into any account holders, tax-qualified employee agreement or understanding to transfer, § 563b.355 What subscription rights must stock ownership plans, and I give to each eligible account holder and the legal or beneficial ownership of supplemental eligible account holders. subscription rights for your conversion each supplemental eligible account holder? shares or the underlying securities to (a) You must give each eligible § 563b.370 Does OTS limit the aggregate the account of another; account holder subscription rights to purchases by officers, directors, and their (2) Make any offer, or any purchase conversion shares in an associates? announcement of an offer, to purchase amount equal to the greater of: (a) When you convert, your officers, any of your conversion shares from (1) The maximum purchase limitation directors, and their associates may not anyone but you; or established for the community offering purchase, in the aggregate, more than (3) Knowingly acquire more than the or the public offering under § 563b.395; the following percentage of your total maximum purchase limitations (2) One-tenth of one percent of the stock offering: established in your plan of conversion. total stock offering; or (c) The restrictions in paragraphs (3) Fifteen times the following Officer and (b)(1) and (b)(2) of this section do not director number: the total number of conversion Institution size purchases apply to offers for more than 10 percent shares that you will issue, multiplied by (percent) of any class of conversion shares by: the following fraction. The numerator is (1) An underwriter or a selling group, the total qualifying deposit of the $50,000,000 or less ...... 35 acting on your behalf, that makes the eligible account holder. The $50,000,001—100,000,000 .... 34 offer with a view toward public resale; denominator is the total qualifying $100,000,001—150,000,000 .. 33 or $150,000,001—200,000,000 .. 32 deposits of all eligible account holders. $200,000,001—250,000,000 .. 31 (2) One or more of your tax-qualified You must round down the product of employee stock ownership plans so long $250,000,001—300,000,000 .. 30 this multiplied fraction to the next $300,000,001—350,000,000 .. 29 as the plan or plans do not beneficially whole number. own more than 25 percent of any class $350,000,001—400,000,000 .. 28 (b) You must give subscription rights $400,000,001 450,000,000 ..... 27 of your equity securities in the to purchase shares to each supplemental $450,000,001—500,000,000 .. 26 aggregate. Over $500,000,000 ...... 25 (d) If any person is found to have eligible account holder in the same violated the restrictions in paragraphs amount as described in paragraph (a) of this section, except that you must (b) The purchase limitations in this (b)(1) and (b)(2) of this section, they may section do not apply to shares held in face prosecution or other legal action. compute the fraction described in paragraph (a)(3) of this section as tax-qualified employee stock benefit § 563b.345 How may a subscriber pay for follows: The numerator is the total plans that are attributable to your my conversion shares? qualifying deposit of the supplemental officers, directors, and their associates. (a) A subscriber may purchase eligible account holder. The § 563b.375 How do I allocate my conversion shares with cash, by a denominator is the total qualifying conversion shares if my shares are withdrawal from a savings account, or a deposits of all supplemental eligible oversubscribed? withdrawal from a certificate of deposit. account holders. (a) If your conversion shares are If a subscriber purchases shares by a § 563b.360 Are my officers, directors, and oversubscribed by your eligible account withdrawal from a certificate of deposit, their associates eligible account holders? holders, you must allocate shares among you may not assess a penalty for the Your officers, directors, and their the eligible account holders so that withdrawal. each, to the extent possible, may (b) You may not extend credit to any associates may be eligible account holders. However, if an officer, director, purchase 100 shares. person to purchase your conversion (b) If your conversion shares are shares. or his or her associate receives subscription rights based on increased oversubscribed by your supplemental § 563b.350 Must I pay interest on deposits in the year before the eligibility eligible account holders, you must payments for conversion shares? record date, you must subordinate allocate shares among the supplemental (a) You must pay interest from the subscription rights for these deposits to eligible account holders so that each, to date you receive a payment for subscription rights exercised by other the extent possible, may purchase 100 conversion shares until the date you eligible account holders. shares. complete or terminate the conversion. (c) If a person is an eligible account You must pay interest at no less than § 563b.365 May other voting members holder and a supplemental eligible your passbook rate for amounts paid in purchase conversion shares in the account holder, you must include the cash, check, or money order. conversion? eligible account holder’s allocation in (b) If a subscriber withdraws money (a) You must give rights to purchase determining the number of conversion from a savings account to purchase your conversion shares in the shares that you may allocate to the conversion shares, you must pay conversion to voting members who are person as a supplemental eligible interest on the payment until you neither eligible account holders nor account holder. complete or terminate the conversion as supplemental eligible account holders. (d) For conversion shares that you do if the withdrawn amount remained in You must allocate rights to each voting not allocate under paragraphs (a) and (b) the account. member that are equal to the greater of: of this section, you must allocate the (c) If a depositor fails to maintain the (1) The maximum purchase limitation shares among the eligible or applicable minimum balance established for the community offering supplemental eligible account holders VerDate 11 equitably, based on the amounts of number of shares must equal the lesser within the time remaining in the qualifying deposits. You must describe of the number of shares obtained by a extension period. this method of allocation in your plan $500 subscription or 25 shares. Completion of the Conversion of conversion. (d) In setting purchase limitations (e) If shares remain after you have under this section, you may not § 563b.420 When must I complete my allocated shares as provided in aggregate conversion shares attributed to conversion? paragraphs (a) and (b) of this section, a person in your tax-qualified employee (a) You must complete the conversion and if your voting members stock ownership plan with shares within 24 months of the date that your oversubscribe, you must allocate your purchased directly by, or otherwise members approve the conversion. Once conversion shares among those attributable to, that person. OTS approves the conversion, it will not members equitably. You must describe permit extension of the completion date. the method of allocation in your plan of § 563b.390 Must I provide a purchase preference to persons in my local (b) Your conversion is complete on conversion. community? the date that you accept the offers for your stock. § 563b.380 May my employee stock (a) In your subscription offering, you ownership plan purchase conversion may give a purchase preference to § 563b.425 Who may terminate the shares? eligible account holders, supplemental conversion? (a) Your tax-qualified employee stock eligible account holders, and voting (a) Your members may terminate the ownership plan may purchase up to 10 members residing in your local conversion by failing to approve the percent of the total offering of your community. conversion at your members’ meeting. conversion shares. (b) In your community offering, you (b) You may terminate the conversion (b) If OTS approves a revised stock must give a purchase preference to before your members’ meeting. valuation range as described in natural persons residing in your local (c) You may terminate the conversion § 563b.330(e), and the final conversion community. after the members’ meeting only if OTS stock valuation range exceeds the concurs. former maximum stock offering range, § 563b.395 What other conditions apply you may allocate conversion shares to when I offer conversion shares in a § 563b.430 What happens to my old community offering, a public offering, or charter? your tax-qualified employee stock both? ownership plan, up to the 10 percent (a) If you are a federally chartered limit in paragraph (a) of this section. (a) You must offer and sell your stock mutual savings association or savings (c) If your tax-qualified employee to achieve a widespread distribution of bank, and you convert to a federally stock ownership plan chooses not to the stock. chartered stock savings association or purchase stock in the offering, it may, (b) If you offer shares in a community savings bank, you must apply to OTS to with prior OTS approval and offering, a public offering, or both, you amend your charter and bylaws appropriate disclosure in your offering must first fill orders for your stock up consistent with part 552 of this chapter, circular, purchase stock in the open to a maximum of two percent of the as part of your application for market, or purchase authorized but conversion stock on a basis that will conversion. You may only include OTS unissued conversion shares. promote a widespread distribution of pre-approved anti-takeover provisions (d) You may include stock stock. You must allocate any remaining in your amended charter and bylaws. contributed to a charitable organization shares on an equal number of shares per See 12 CFR 552.4(b)(8). OTS will state in the conversion in the calculation of order basis until you fill all orders. the effective date of your charter the total offering of conversion shares Completion of the Offering amendments in its approval of the under paragraphs (a) and (b) of this conversion. section, unless OTS objects on § 563b.400 When must I complete the sale (b) If you are a federally chartered supervisory grounds. of my stock? mutual savings association or savings You must complete all sales of your bank and you convert to a state- § 563b.385 May I impose any purchase stock within 45 calendar days after the chartered stock savings association limitations? last day of the subscription period, under this part, you must surrender (a) You may limit the number of unless the offering is extended under your federal charter to OTS for shares that any person, group of § 563b.405. cancellation promptly after the state associated persons, or persons otherwise issues your charter. You must promptly acting in concert, may subscribe to § 563b.405 How do I extend the offering file a copy of your new state stock between one percent and five percent of period? charter with OTS. the total stock sold. (a) You must request, in writing, an (c) If you are a state-chartered mutual (b) If you set a limit of five percent extension of any offering period. savings association or savings bank, and under paragraph (a) of this section, you (b) OTS may grant extensions of time you convert to a federally chartered may modify that limit with OTS to sell your shares. OTS will not grant stock savings association or savings approval to provide that any person, any single extension of more than 90 bank, you must apply to OTS for a new group of associated persons, or persons days. charter and bylaws consistent with part otherwise acting in concert subscribing (c) If OTS grants your request for an 552 of this chapter. You may only for five percent, may purchase between extension of time, you must provide a include OTS pre-approved anti-takeover five and ten percent as long as the post-effective amendment to the offering provisions in your charter and bylaws. aggregate amount that the subscribers circular under § 563b.310 to each person See 12 CFR 552.4(b)(8). OTS will state purchase does not exceed 10 percent of who subscribed for or ordered stock. the effective date of your charter the total stock offering. Your amendment must indicate that amendments with its approval of the (c) You may require persons OTS extended the offering period and conversion. exercising subscription rights to that each person who subscribed for or (d) Your new or amended charter purchase a minimum number of ordered stock may increase, decrease, or must require you to establish and conversion shares. The minimum rescind their subscription or order maintain a liquidation account for VerDate 11 eligible and supplemental eligible § 563b.460 How do I determine the initial subsequently increase it if the deposit account holders under § 563b.450. balances of liquidation sub-accounts? balance increases. (a)(1) You determine the initial sub- (c) You are not required to adjust the § 563b.435 What happens to my corporate account balance for a savings account liquidation account and sub-account existence after conversion? held by an eligible account holder by balances at each annual closing date if Your corporate existence will multiplying the initial balance of the you maintain sufficient records to make continue following your conversion, liquidation account by the following the computations if a liquidation unless you convert to a state-chartered fraction: The numerator is the qualifying subsequently occurs. stock savings association and state law deposit in the savings account (d) You must maintain the liquidation prescribes otherwise. expressed in dollars on the eligibility sub-account for each account holder as § 563b.440 What voting rights must I record date. The denominator is total long as the account holder maintains an provide to stockholders after the qualifying deposits of all eligible account with the same social security conversion? account holders on that date. number. (e) If there is a complete liquidation, You must provide your stockholders (2) You determine the initial sub- you must provide each account holder with exclusive voting rights, except as account balance for a savings account with a liquidation distribution in the provided in § 563b.445(c). held by a supplemental eligible account holder by multiplying the initial balance amount of the sub-account balance. § 563b.445 What must I provide my of the liquidation account by the § 563b.475 What is a liquidation? savings account holders? following fraction: The numerator is the (a) You must provide each savings qualifying deposit in the savings (a) A liquidation is a sale of your account holder, without payment, a account expressed in dollars on the assets and settlement of your liabilities withdrawable savings account or supplemental eligibility record date. with the intent to cease operations and close. Upon liquidation, you must accounts in the same amount and under The denominator is total qualifying return your charter to the governmental the same terms and conditions as their deposits of all supplemental eligible agency that issued it. The government accounts before your conversion. account holders on that date. (b) You must provide a liquidation (3) If an account holder holds a agency must cancel your charter. (b) A merger, consolidation, or similar account for each eligible and savings account on the eligibility record combination or transaction with another supplemental eligible account holder date and a separate savings account on depository institution, is not a under § 563b.450. the supplemental eligibility record date, liquidation. If you are involved in such (c) If you are a state-chartered savings you must compute separate sub- a transaction, the surviving institution association and state law requires you to accounts for the qualifying deposits in must assume the liquidation account. provide voting rights to savings account the savings account on each record date. holders or borrowers, your charter must: (b) You may not increase the initial § 563b.480 Does the liquidation account (1) Limit these voting rights to the sub-account balances. You must affect my net worth? minimum required by state law; and decrease the initial balance under The liquidation account does not (2) Require you to solicit proxies from § 563b.470 as depositors reduce or close affect your net worth. the savings account holders and their accounts. borrowers in the same manner that you § 563b.485 What provision must I include § 563b.465 Do account holders retain any solicit proxies from your stockholders. in my new federal charter? voting rights based on their liquidation sub- If you convert to federal stock form, accounts? Liquidation Account you must include the following Eligible account holders or provision in your new charter: § 563b.450 What is a liquidation account? supplemental eligible account holders (a) A liquidation account represents ‘‘Liquidation Account. Under OTS do not retain any voting rights based on regulations, the association must the potential interest of eligible account their liquidation sub-accounts. holders and supplemental eligible establish and maintain a liquidation account holders in your net worth at the § 563b.470 Must I adjust liquidation sub- account for the benefit of its savings llllll time of conversion. You must maintain accounts? account holders as of . If a sub-account to reflect the interest of (a)(1) You must reduce the balance of the association undergoes a complete each account holder. an eligible account holder’s or liquidation, it must comply with OTS (b) Before you may provide a supplemental eligible account holder’s regulations with respect to the amount liquidation distribution to common sub-account if the deposit balance in the and priorities on liquidation of each of stockholders, you must give a account holder’s savings account at the the savings account holder’s interests in liquidation distribution to those eligible close of business on any annual closing the liquidation account. A savings account holders and supplemental date, which for purposes of this section account holder’s interest in the eligible account holders who hold is your fiscal year end, after the relevant liquidation account does not entitle the savings accounts from the time of eligibility record dates is less than: savings account holder to any voting conversion until liquidation. (i) The deposit balance in the account rights.’’ (c) You may not record the liquidation holder’s savings account at the close of Post-Conversion account in your financial statements. business on any other annual closing You must disclose the liquidation date after the relevant eligibility record § 563b.500 May I implement a stock option account in the footnotes to your date; or plan or management or employee stock financial statements. (ii) The qualifying deposits in the benefit plan? account holder’s savings account on the (a) You may implement a stock option § 563b.455 What is the initial balance of relevant eligibility record date. plan or management or employee stock the liquidation account? (2) The reduction must be benefit plan within 12 months after your The initial balance of the liquidation proportionate to the reduction in the conversion, if you meet all of the account is your net worth in the deposit balance. following requirements. statement of financial condition (b) If you reduce the balance of a (1) You disclose the plans in your included in the final offering circular. liquidation sub-account, you may not proxy statement and offering circular VerDate 11 and indicate in the offering circular that (11) Your plan does not begin to vest involving more than one percent of your there will be a separate vote on the earlier than one year after your outstanding stock, and may purchase plans at least six months after the shareholders approve the plan, and does stock through any of your management conversion. not vest at a rate exceeding 20 percent or employee stock benefit plans. (2) You do not grant stock options a year. (12) Your plan permits accelerated § 563b.510 May I repurchase shares after under your stock option plan in excess conversion? of 10 percent of shares that you issued vesting only for disability or death, or if (a) You may not repurchase your in the conversion. you undergo a change of control. shares in the first year after the (3) You do not permit your (13) Your plan provides that your executive officers or directors must conversion except: management stock benefit plans, in the (1) In extraordinary circumstances, aggregate, to hold more than three exercise or forfeit their options in the event the institution becomes critically you may make open market repurchases percent of the shares that you issued in of up to five percent of your outstanding undercapitalized (as defined in § 565.4 the conversion. However, if you have stock in the first year after the of this chapter), is subject to OTS tangible capital of 10 percent or more conversion if you file a notice under enforcement action, or receives a capital following the conversion, OTS may § 563b.515(a) and OTS does not permit you to establish a management directive under § 565.7. (14) You file a copy of the approved disapprove your repurchase. OTS will stock benefit plan that holds up to four not approve such repurchases unless the stock option plan or management or percent of the shares that you issued in repurchase meets the standards in employee stock benefit plan with OTS the conversion. § 563b.515(c), and the repurchase is and certify to OTS in writing that the (4) You do not permit your tax- consistent with paragraph (c) of this plan approved by the shareholders is qualified employee stock benefit plan(s) section. and your management stock benefit the same plan that you filed with, and (2) You may repurchase qualifying plans, in the aggregate, to hold more disclosed in, the proxy materials shares of a director or conduct an OTS than 10 percent of the shares that you distributed to shareholders in approved repurchase pursuant to an issued in the conversion. However, if connection with the vote on the plan. offer made to all shareholders of your you have tangible capital of 10 percent (15) You file the plan and the association. or more following the conversion, OTS certification with OTS within five (3) Repurchases to fund management may permit your tax-qualified employee calendar days after your shareholders recognition plans that have been ratified stock benefit plan(s) and your approve the plan. by shareholders do not count toward the management stock benefit plans, in the (b) You may provide dividend repurchase limitations in this section. aggregate, to hold up to 12 percent of equivalent rights or dividend Repurchases in the first year to fund the shares that you issued in the adjustment rights to allow for stock such plans require prior notification to conversion. splits or other adjustments to your stock OTS. (5) No individual receives more than in stock option plans or management or (4) Purchases to fund tax qualified 25 percent of the shares under any plan. employee stock benefit plans under this employee stock benefit plans do not (6) Your directors who are not your section. count toward the repurchase limitations employees do not receive more than five (c) If the plan is adopted more than in this section. percent of the shares of any plan one year following your conversion, any (b) After the first year, you may individually, or 30 percent of the shares material deviations to the requirements repurchase your shares, subject to all of any plan in the aggregate. in paragraph (a) of this section must be other applicable regulatory and (7) Your shareholders approve each ratified by your shareholders. supervisory restrictions and paragraph plan by a majority of the total votes § 563b.505 May my directors, officers, and (c) of this section. eligible to be cast at a duly called their associates freely trade shares? (c) All stock repurchases are subject to the following restrictions. meeting before you establish or (a) Directors and officers who implement the plan. You may not hold (1) You may not repurchase your purchase conversion shares may not sell shares if the repurchase will reduce this meeting until six months after your the shares for one year after the date of conversion. If you are a subsidiary of a your regulatory capital below the purchase, except that in the event of the amount required for your liquidation mutual holding company, a majority of death of the officer or director, the the total votes eligible to be cast (other account under § 563b.450. You must successor in interest may sell the shares. comply with the capital distribution than your parent mutual holding (b) You must include notice of the requirements at part 563, subpart E of company) must approve each plan restriction described in paragraph (a) of before you may establish or implement this chapter. this section on each certificate of stock (2) The restrictions on share the plan. that a director or officer purchases repurchases apply to a charitable (8) When you distribute proxies or during the conversion or receives in organization under § 563b.550. You related material to shareholders in connection with a stock dividend, stock must aggregate purchases of shares by connection with the vote on a plan, you split, or otherwise with respect to such the charitable organization with your state that the plan complies with OTS restricted shares. repurchases. regulations and that OTS does not (c) You must instruct your stock endorse or approve the plan in any way. transfer agent about the transfer 563b.515 What information must I provide You may not make any written or oral restrictions in this section. to OTS before I repurchase my shares? representation to the contrary. (d) For three years after you convert, (a) To repurchase stock in the first (9) You do not grant stock options at your officers, directors, and their year following conversion, other than less than the market price at the time of associates may purchase your stock only repurchases under § 563b.510(a)(3) or grant. from a broker or dealer registered with (a)(4), you must file a written notice (10) You do not use stock issued at the Securities and Exchange with the OTS. You must provide the the time of conversion to fund Commission. However, your officers, following information: management or employee stock benefit directors, and their associates may (1) Your proposed repurchase plans. engage in a negotiated transaction program; VerDate 11 (2) The effect of the repurchases on conclusive control determination or (a) Promptly register your shares your regulatory capital; and rebuttable control determination under under the Securities Exchange Act of (3) The purpose of the repurchases §§ 574.4(a) and (b) of this chapter. OTS 1934 (15 U.S.C. 78a–78jj, as amended). and, if applicable, an explanation of the will presume that a person has acquired You may not deregister the shares for extraordinary circumstances shares if the acquiror entered into a three years. necessitating the repurchases. binding written agreement for the (b) Encourage and assist a market (b) You must file your notice with transfer of shares. For purposes of this maker to establish and to maintain a your Regional Director, with a copy to section, an offer is made when it is market for your shares. A market maker the Applications Filing Room, at least communicated. An offer does not for a security is a dealer who: ten days before you begin your include non-binding expressions of (1) Regularly publishes bona fide repurchase program. understanding or letters of intent competitive bid and offer quotations for (c) You may not repurchase your regarding the terms of a potential the security in a recognized inter-dealer shares if OTS objects to your repurchase acquisition. quotation system; program. OTS will not object to your (c) Notwithstanding the restrictions in (2) Furnishes bona fide competitive repurchase program if: this section: bid and offer quotations for the security (1) Your repurchase program will not (1) Paragraphs (a) and (b) of this on request; or adversely affect your financial section do not apply to any offer with (3) May effect transactions for the condition; a view toward public resale made security in reasonable quantities at (2) You submit sufficient information exclusively to you, to the underwriters, quoted prices with other brokers or to evaluate your proposed repurchases; or to a selling group acting on your dealers. (3) You demonstrate extraordinary behalf. (c) Use your best efforts to list your circumstances and a compelling and (2) Unless OTS objects in writing, any shares on a national or regional valid business purpose for the share person may offer or announce an offer securities exchange or on the National repurchases; and to acquire up to one percent of any class Association of Securities Dealers (4) Your repurchase program would of shares. In computing the one percent Automated Quotation system. not be contrary to other applicable limit, the person must include all of his (d) File all post-conversion reports regulations. or her acquisitions of the same class of that OTS requires. shares during the prior 12 months. § 563b.520 May I declare or pay dividends (3) A corporation whose ownership is, Contributions to Charitable after I convert? or will be, substantially the same as Organizations your ownership may acquire or offer to You may declare or pay a dividend on § 563b.550 May I donate conversion your shares after you convert if: acquire more than ten percent of your shares or conversion proceeds to a (a) The dividend will not reduce your common stock, if it makes the offer or charitable organization? acquisition more than one year after you regulatory capital below the amount You may contribute some of your convert. required for your liquidation account conversion shares or proceeds to a under § 563b.450; (4) One or more of your tax-qualified employee stock benefit plans may charitable organization if: (b) You comply with all capital (a) Your plan of conversion provides requirements under part 567 of this acquire your shares, if the plan or plans do not beneficially own more than 25 for the proposed contribution; chapter after you declare or pay (b) Your members approve the percent of any class of your shares in dividends; proposed contribution; and the aggregate. (c) You comply with the capital (c) The IRS either has approved, or distribution requirements under part (5) An acquiror does not have to file a separate application to obtain OTS approves within two years after 563, subpart E of this chapter; and formation, the charitable organization as (d) You do not return any capital to approval under paragraph (a) of this section, if the acquiror files an a tax-exempt charitable organization purchasers in the first year following under the Internal Revenue Code. conversion, and return capital to application under part 574 of this purchasers after the first year only if the chapter that specifically addresses the § 563b.555 How do my members approve return of capital is consistent with your criteria listed under paragraph (d) of a charitable contribution? business plan. this section and you do not oppose the At the meeting to consider your proposed acquisition. conversion, your members must § 563b.525 Who may acquire my shares (d) OTS may deny an application separately approve by at least a majority after I convert? under paragraph (a) of this section if the of the total eligible votes, a contribution (a) For three years after you convert, proposed acquisition: of conversion shares or proceeds. If you no person may, directly or indirectly, (1) Is contrary to the purposes of this are in mutual holding company form acquire or offer to acquire the beneficial part; and adding a charitable contribution as (2) Is manipulative or deceptive; ownership of more than ten percent of part of a second step stock conversion, any class of your equity securities (3) Subverts the fairness of the conversion; you must also have a majority of your without OTS’s prior written approval. If minority shareholders approve the a person violates this prohibition, you (4) Is likely to injure you; (5) Is inconsistent with your plan to charitable contribution. may not permit the person to vote meet the credit and lending needs of shares in excess of ten percent, and may § 563b.560 How much may I contribute to your proposed market area; not count the shares in excess of ten a charitable organization? (6) Otherwise violates laws or percent in any shareholder vote. You may contribute a reasonable regulations; or (b) A person acquires beneficial (7) Does not prudently deploy your amount of conversion shares or ownership of more than ten percent of conversion proceeds. proceeds to a charitable organization if a class of shares when he or she holds your contribution will not exceed limits any combination of your stock or § 563b.530 What other requirements apply for charitable deductions under the revocable or irrevocable proxies under after I convert? Internal Revenue Code, and OTS does circumstances that give rise to a After you convert, you must: not object on supervisory grounds. If VerDate 11 you are a well capitalized savings § 563b.575 What other requirements apply unless a requirement is clearly association, OTS generally will not to charitable organizations? inapplicable. object if you contribute an aggregate (a) The charitable organization’s charter and bylaws (or trust agreement) § 563b.605 How may I conduct a voluntary amount of eight percent or less of the supervisory conversion? conversion shares or proceeds. and the gift instrument for the contribution must provide that: (a) You may sell your shares or the § 563b.565 What must the charitable (1) OTS may examine the charitable shares of a holding company to the organization include in its organizational organization at the charitable public under the requirements of documents? organization’s expense; subpart A of this part. The charitable organization’s charter (2) The charitable organization must (b) You may convert to stock form by and bylaws (or trust agreement), gift comply with all supervisory directives merging into an interim federal- r state- instrument, and operating plan must that OTS imposes; chartered stock association. (c) You may sell your shares directly provide that: (3) The charitable organization must to an acquiror, who may be a person, (a) The charitable organization’s annually provide OTS with a copy of company, depository institution, or primary purpose is to serve and make the annual report that the charitable depository institution holding company. grants in your local community; organization submitted to the IRS; (d) You may merge or consolidate (4) The charitable organization must (b) As long as the charitable with an existing or newly created operate according to written policies organization controls shares, you must depository institution. The merger or adopted by its board of directors (or consider those shares as voted in the consolidation must be authorized by, board of trustees), including a conflict of same ratio as all other shares voted on and is subject to, other applicable laws interest policy; and each proposal considered by your and regulations. shareholders; (5) The charitable organization may (c) For at least five years after its not engage in self-dealing, and must § 563b.610 Do my members have rights in organization, one seat on the charitable comply with all laws necessary to a voluntary supervisory conversion? organization’s board of directors (or maintain its tax-exempt status under the Your members do not have the right board of trustees) is reserved for an Internal Revenue Code. to approve or participate in a voluntary independent director (or trustee) from (b) You must include the following supervisory conversion, and will not your local community. This director legend in the stock certificates of shares have any legal or beneficial ownership may not be your officer, director, or that you contribute to the charitable interests in the converted association, employee, or your affiliate’s officer, organization or that the charitable unless OTS provides otherwise. Your director, or employee, and should have organization otherwise acquires: ‘‘The members may have interests in a experience with local community board of directors must consider the liquidation account, if one is charitable organizations and grant shares that this stock certificate established. making; and represents as voted in the same ratio as all other shares voted on each proposal Eligibility (d) For at least five years after its considered by the shareholders, as long organization, one seat on the charitable § 563b.625 When is a savings association as the shares are controlled by the organization’s board of directors (or eligible for a voluntary supervisory charitable organization.’’ conversion? board of trustees) is reserved for a (c) OTS may review the compensation director from your board of directors or (a) If you are an insured savings paid to charitable organization directors association, you may be eligible to the board of directors of an acquiror or (or trustees) who are not your directors, resulting institution in the event of a convert under this subpart if: employees, or affiliates. (1)You are significantly merger or acquisition of your (d) After you complete your stock undercapitalized (or you are organization. offering, you must submit four executed undercapitalized and a standard § 563b.570 How do I address conflicts of copies of the following documents to conversion that would make you interest involving my directors? the OTS Applications Filing Room in adequately capitalized is not feasible), (a) A person who is your director, Washington, and three executed copies and you will be a viable entity following officer, or employee, or a person who to the OTS Regional Office: the the conversion; has the power to direct your charitable organization’s charter and (2) Severe financial conditions management or policies, or otherwise bylaws (or trust agreement), operating threaten your stability and a conversion owes a fiduciary duty to you (for plan, conflict of interest policy, and the is likely to improve your financial example, holding company directors) gift instrument for your contributions of condition; (3) FDIC will assist you under section and who will serve as an officer, either stock or cash to the charitable 13 of the Federal Deposit Insurance Act, director, or employee of the charitable organization. 12 U.S.C. 1823; or organization, is subject to § 563.200 of Subpart B—Voluntary Supervisory (4) You are in receivership and a this chapter. See Form AC (Exhibit 9) Conversions conversion will assist you. for further information on operating (b) You will be a viable entity plans and conflict of interest plans. § 563b.600 What does this subpart do? following the conversion if you satisfy (b) Before your board of directors may (a) You must comply with this all of the following: adopt a plan of conversion that includes subpart to engage in a voluntary (1) You will be adequately capitalized a charitable organization, you must supervisory conversion. This subpart as a result of the conversion; identify your directors that will serve on applies to all voluntary supervisory (2) You, your proposed conversion, the charitable organization’s board. conversions under sections 5(i)(1), (i)(2), and your acquiror(s) comply with These directors may not participate in and (p) of the Home Owners’ Loan Act applicable supervisory policies; your board’s discussions concerning (HOLA), 12 U.S.C. 1464(i)(1), (i)(2), and (3) The transaction is in your best contributions to the charitable (p). interest, and the best interest of the organization, and may not vote on the (b) Subpart A of this part also applies federal deposit insurance funds and the matter. to a voluntary supervisory conversion, public; and VerDate 11 (4) The transaction will not injure or Voluntary Supervisory Conversion the officer or employee to be employed, be detrimental to you, the federal Application and the amount of any conversion deposit insurance funds, or the public shares to be purchased by the officer or § 563b.660 What must I include in my employee or his or her affiliates or interest. voluntary supervisory conversion application? associates. § 563b.630 When is a BIF-insured state- (g) Related applications. (1) All filings chartered savings bank eligible for a You must include all of the following required under the securities offering voluntary supervisory conversion? information and documents in a rules of 12 CFR parts 563b and 563g. voluntary supervisory conversion If you are a BIF-insured state- (2) Any required Holding Company application to OTS under this subpart: Act application, Control Act notice, or chartered savings bank you may be (a) Eligibility. (1) Evidence rebuttal submission under part 574 of eligible to convert to a federal stock establishing that you meet the eligibility this chapter, including prior-conduct savings bank under this subpart if: requirements under §§ 563b.625 or certifications under Regulatory Bulletin 563b.630. (a) FDIC certifies under section 20. (2) An opinion of qualified, 5(o)(2)(C) of the HOLA that severe (3) A subordinated debt application, if independent counsel or an independent, financial conditions threaten your applicable. certified public accountant regarding stability and that the voluntary (4) Applications for permission to the tax consequences of the conversion, supervisory conversion is likely to organize a stock association and for or an IRS ruling indicating that the improve your financial condition, and approval of a merger, if applicable, and transaction qualifies as a tax-free OTS concurs with this certification; or a copy of any application for Federal reorganization. Home Loan Bank membership or FDIC (b) You meet the following (3) An opinion of independent insurance of accounts, if applicable. conditions: counsel indicating that applicable state (5) A statement describing any other (1) Your liabilities exceed your assets, law authorizes the voluntary applications required under federal or as calculated under generally accepted supervisory conversion, if you are a state banking laws for all transactions accounting principles, assuming you are state-chartered savings association related to your conversion, copies of all a going concern; and converting to state stock form. dispositive documents issued by (b) Plan of conversion. A plan of (2) You will issue a sufficient amount regulatory authorities relating to the voluntary supervisory conversion that of permanent capital stock to meet your applications, and, if requested by OTS, complies with § 563b.650. applicable FDIC capital requirement copies of the applications and related immediately upon completion of the (c) Business plan. A business plan that complies with § 563b.105, where documents. conversion, or FDIC determines that you (h) Waiver request. A description of will achieve an acceptable capital level required by OTS. (d) Financial data. (1) Your most any of the features of your application within an acceptable time period. recent audited financial statements and that do not conform to the requirements of this subpart, including any request Plan of Supervisory Conversion Thrift Financial Report. You must explain how your current capital levels for waiver of these requirements. § 563b.650 What must I include in my plan make you eligible to engage in a OTS Review of the Voluntary of voluntary supervisory conversion? voluntary supervisory conversion under Supervisory Conversion Application A majority of your board of directors §§ 563b.625 or 563b.630. (2) A description of your estimated § 563b.670 Will OTS approve my voluntary must adopt a plan of voluntary supervisory conversion application? supervisory conversion. You must conversion expenses. include all of the following information (3) Evidence supporting the value of OTS will generally approve your application to engage in a voluntary in your plan of voluntary supervisory any non-cash asset contributions. supervisory conversion unless it conversion. Appraisals must be acceptable to OTS and the non-cash asset must meet all determines: (a) Your name and address. other OTS policy guidelines. See Thrift (a) You do not meet the eligibility (b) The name, address, date and place Activities Handbook Section 110 for requirements for a voluntary of birth, and social security number of guidelines. supervisory conversion under each proposed purchaser of conversion (4) Pro forma financial statements that §§ 563b.625 or 563b.630 or because the shares and a description of that reflect the effects of the transaction. You proceeds from the sale of your purchaser’s relationship to you. must identify your tangible, core, and conversion stock, less the expenses of the conversion, would be insufficient to (c) The title, per-unit par value, risk-based capital levels and show the satisfy any applicable viability number, and per-unit and aggregate adjustments necessary to compute the capital levels. You must prepare your requirement; offering price of shares that you will pro forma statements in conformance (b) The transaction is detrimental to issue. with OTS regulations and policy. or would cause potential injury to you (d) The number and percentage of (e) Proposed documents. (1) Your or the federal deposit insurance funds or shares that each investor will purchase. proposed charter and bylaws. is contrary to the public interest; (e) The aggregate number and (2) Your proposed stock certificate (c) You or your acquiror, or the percentage of shares that each director, form. controlling parties or directors and officer, and any affiliates or associates of (f) Agreements. (1) A copy of any officers of you or your acquiror, have the director or officer will purchase. agreements between you and proposed engaged in unsafe or unsound practices purchasers. in connection with the voluntary (f) A description of any liquidation (2) A copy and description of all supervisory conversion; or account. existing and proposed employment (d) You fail to justify an employment (g) Certified copies of all resolutions contracts. You must describe the term, contract incidental to the conversion, or of your board of directors relating to the salary, and severance provisions of the the employment contract will be an conversion. contract, the identity and background of unsafe or unsound practice or represent VerDate 11 a sale of control. In a voluntary Authority: 12 U.S.C. 1467a, 1817, 1831i. savings association subsidiary of a supervisory conversion, OTS generally mutual holding company may issue § 574.3 [Amended] will not approve employment contracts stock as part of a stock benefit plan to of more than one year for your existing 3. Section 574.3(c)(1)(vii) is amended any insider, associate of an insider, or management. by removing the phrase ‘‘563b.2(a)(39)’’ tax qualified or non-tax qualified and adding in lieu thereof the phrase employee stock benefit plan of the § 563b.675 What conditions will OTS ‘‘563b.25’’. impose on an approval? mutual holding company or subsidiary of the mutual holding company without (a) OTS will condition approval of a PART 575—MUTUAL HOLDING including the purchase priorities of 12 voluntary supervisory conversion COMPANIES CFR part 563b. application on all of the following. 4. The authority citation for part 575 (1) You must complete the conversion continues to read as follows: (8) As part of a reorganization, a stock sale within three months after reasonable amount of shares or proceeds OTS approves your application. OTS Authority: 12 U.S.C. 1462, 1462a, 1463, may be contributed to a charitable may grant an extension for good cause. 1464, 1467a, 1828, 2901. organization that complies with (2) You must comply with all filing § 575.2 [Amended] §§ 563b.550 to 563b.575 of this chapter, requirements of parts 563b and 563g of 5. Section 575.2(a) is amended by provided such contribution does not this chapter. removing the phrase ‘‘12 CFR 563b.2’’, result in any taxes on excess business (3) You must submit an opinion of and by adding in lieu thereof the phrase holdings under section 4943 of the independent legal counsel indicating ‘‘563b.25 of this chapter’’. Internal Revenue Code (26 U.S.C. 4943). that the sale of your shares complies * * * * * with all applicable state securities law § 575.4 [Amended] requirements. 6. Section 575.4(c)(2) is amended by 8. Section 575.8 is amended by: (4) You must comply with all removing the phrase ‘‘economical home a. Removing, in paragraph (a) applicable laws, rules, and regulations. financing’’, and by adding in lieu introductory text, the phrase (5) You must satisfy any other thereof the phrase ‘‘the credit and ‘‘§ 563b.27(a)’’, and by adding in lieu requirements or conditions OTS may lending needs of your proposed market thereof the phrase ‘‘§ 563b.650’’; impose. area’’. (b) OTS may condition approval of a b. Amending paragraphs (a)(3), (a)(4), 7. Section 575.7 is amended by: (a)(5), and (a)(6) to remove the phrase voluntary supervisory conversion a. Revising the paragraph heading and ‘‘ten’’, and by adding in lieu thereof the application on either of the following: adding a new first sentence to paragraph phrase ‘‘4.9’’, and by removing the (1) You must satisfy any conditions (a) introductory text; and restrictions OTS imposes to prevent b. Removing, in paragraph (a)(7), the phrase ‘‘held by persons other than the unsafe or unsound practices, to protect phrase ‘‘§ 563b.11 of this chapter’’, and association’s mutual holding company the federal deposit insurance funds and by adding in lieu thereof the phrase parent’’; the public interest, and to prevent ‘‘§ 563b.200(c) of this chapter’’; c. Revising paragraph (a)(7); potential injury or detriment to you c. Removing, in paragraph (b)(1), the d. Revising paragraph (a)(8); before and after the conversion. OTS phrase ‘‘§ 563b.7’’ where it appears in may impose these conditions and the first and second sentences, and by e. Redesignating paragraphs (a)(9) restrictions on you (before and after the adding in lieu of both phrases the through (a)(21) as paragraphs (a)(10) conversion), your acquiror, controlling phrase ‘‘part 563b of this chapter’’; through (a)(22), respectively; parties, directors and officers of you or d. Removing, in paragraph (b)(2), the f. Adding a new paragraph (a)(9); your acquiror; or phrase ‘‘§ 563b.7(c)’’, and by adding in (2) You must infuse a larger amount g. Amending newly designated lieu thereof the phrase ‘‘§ 563b.330’’. paragraph (a)(10) by removing the of capital, if necessary, for safety and e. Removing, in paragraph (d)(6)(i), soundness reasons. phrase ‘‘12 CFR 563b.102’’, and by the phrase ‘‘12 CFR 563b.102’’, and by adding in lieu thereof the phrase ‘‘Form Offers and Sales of Stock adding in lieu thereof the phrase ‘‘Form OC’’. OC’’; § 563b.680 How do I sell my shares? f. Adding new paragraphs (d)(7) and The additions and revisions read as If you convert under this subpart, you (d)(8); follows: g. Removing, in paragraph (e), the must offer and sell your shares under § 575.8 Contents of Stock Issuance Plans. part 563g of this chapter. phrase ‘‘§§ 563b.3 through 563b.8 of this chapter’’, and adding in lieu thereof the (a) * * * Post-Conversion phrase ‘‘12 CFR part 563b’’. (7)(i) Provide that the aggregate The additions read as follows: § 563b.690 Who may not acquire amount of common stock acquired in additional shares after the voluntary § 575.7 Issuances of stock by savings the proposed issuance, plus all prior supervisory conversion? association subsidiaries of mutual holding issuances of the association, by all non- For three years after the completion of companies. tax-qualified employee stock benefit a voluntary supervisory conversion, (a) Requirements. Before any stock plans of the association, insiders of the neither you nor any of your controlling issuance, a savings association association, and associates of insiders of shareholder(s) may acquire shares from subsidiary of a mutual holding company the association, exclusive of any stock minority shareholders without OTS’s must submit a business plan in acquired by such plans, insiders, and prior approval. accordance with the provisions of associates in the secondary market, shall §§ 563b.105 through 563b.115 of this PART 574—ACQUISITION OF not exceed the following percentages of chapter.* * * CONTROL OF SAVINGS the outstanding common stock of the ASSOCIATIONS * * * * * association, held by persons other than (d) * * * the association’s mutual holding 2. The authority citation for part 574 (7) Notwithstanding the restrictions in company parent at the close of the is revised to read as follows: paragraph (d)(6)(ii) of this section, a proposed issuance: VerDate 11 Officer and (9) Provide that the aggregate amount 11. Section 575.13 is amended by Institution size director of common stock acquired in the removing, in paragraph (c)(2), the purchases proposed issuance, plus all prior phrase ‘‘§ 563b.8 of this chapter’’, and (percent) issuances of the association, by all stock by adding in lieu thereof the phrase $50,000,000 or less ...... 35 benefit plans, other than employee stock ‘‘§ 563b.150 of this chapter’’, and by $50,000,001–100,000,000 ...... 34 ownership plans, shall not exceed more revising paragraph (a)(1) to read as $100,000,001–150,000,000 .... 33 than 25% of the outstanding common follows: $150,000,001–200,000,000 .... 32 stock of the association held by persons $200,000,001–250,000,000 .... 31 other than the association’s mutual § 575.13 Procedural requirements. $250,000,001–300,000,000 .... 30 holding company parent. $300,000,001–350,000,000 .... 29 (a) Proxies and proxy statements—(1) $350,000,001–400,000,000 .... 28 * * * * * Solicitation of proxies. The provisions $400,000,001–450,000,000 .... 27 9. Section 575.11 is amended by: of §§ 563b.225 to 563b.290 and 563b.25 a. Removing, in paragraphs (c)(1) and $450,000,001–500,000,000 .... 26 to 563b.35 of this chapter shall apply to Over $500,000,000 ...... 25 (c)(2) the phrases ‘‘§ 563b.3(g)(1)’’ or ‘‘§ 563b.3(g)(3)’’ wherever they appear, all solicitations of proxies by any person (ii) In calculating the number of and by adding in lieu thereof the phrase in connection with any membership shares held by insiders and their ‘‘§ 563b.510’’; vote required by this part. OTS must associates under this provision or the b. Adding, in paragraph (e), after the authorize all proxy materials used in provision in paragraph (a)(8) of this phrase ‘‘stock issuance’’ the phrase ‘‘, connection with such solicitations. section, shares held by any tax-qualified and OTS does not object to the Proxy materials must be in the form and or non-tax-qualified employee stock subsequent stock issuance’’; and contain the information specified in benefit plan of the association that are c. Adding new paragraph (i). §§ 563b.255 and 563b.270 of this attributable to such persons shall not be The addition reads as follows: chapter and Form PS, to the extent such counted. § 575.11 Operating restrictions. information is relevant to the action that (8) Provide that the aggregate amount members are being asked to approve, * * * * * of stock, whether common or preferred, with such additions, deletions, and acquired in the proposed issuance, plus (i) Separate vote for charitable organization contribution. In a mutual other modifications as are necessary or all prior issuances of the association, by appropriate under the disclosure all non-tax-qualified employee stock holding company stock issuance, a separate vote of a majority of the standard set forth in § 563b.280 of this benefit plans of the association, insiders chapter. File proxies and proxy of the association, and associates of outstanding shares of common stock statements in accordance with insiders of the association, exclusive of held by stockholders other than the § 563b.155 of this chapter and address any stock acquired by said plans, mutual holding company or subsidiary insiders, and associates in the secondary holding company must approve any them to the Business Transactions market, shall not exceed the following charitable organization contribution. Division, Chief Counsel’s Office, Office percentages of the stockholders’ equity 10. Section 575.12 is amended by of Thrift Supervision, at the address set of the association, held by persons other adding new paragraph (a)(3) to read as forth in § 516.40 of this chapter. For than the association’s mutual holding follows: purposes of this paragraph (a)(1), the company parent at the close of the § 575.12 Conversion or liquidation of term conversion, as it appears in the proposed issuance: mutual holding companies. provisions of part 563b of this chapter (a)* * * cited above in this paragraph (a)(1), Officer and refers to the reorganization or the stock director (3) If a subsidiary holding company or Institution size purchases subsidiary savings association has issuance, as appropriate. (percent) issued shares to an entity other than the * * * * * mutual holding company, the Dated: March 27, 2002. $50,000,000 or less ...... 35 conversion of the mutual holding $50,000,001–100,000,000 ...... 34 company to stock form may not be By the Office of Thrift Supervision. $100,000,001–150,000,000 .... 33 James E. Gilleran, $150,000,001–200,000,000 .... 32 consummated unless a majority of the $200,000,001–250,000,000 .... 31 shares issued to entities other than the Director. $250,000,001–300,000,000 .... 30 mutual holding company vote in favor [FR Doc. 02–7979 Filed 4–8–02; 8:45 am] $300,000,001–350,000,000 .... 29 of the conversion. This requirement BILLING CODE 6720–01–P $350,000,001–400,000,000 .... 28 applies in addition to any otherwise $400,000,001–450,000,000 .... 27 required account holder or shareholder $450,000,001–500,000,000 .... 26 votes. Over $500,000,000 ...... 25 * * * * * VerDate 11 Part IV Office of Management and Budget 14 CFR Chapter VI and Part 1300 Air Transportation Safety and System Stabilization Act; Final Rules VerDate 11 OFFICE OF MANAGEMENT AND also amends OMB’s rules to include a AIR TRANSPORTATION BUDGET technical reference to ATSB’s rules. STABILIZATION BOARD Because this final rule is technical in 14 CFR Chapter VI and Part 1300 nature, relates to public loan guarantees, 14 CFR Part 1310 and does not affect the substantive Air Transportation Safety and System Administrative Regulations for Air rights or obligations of any person, Stabilization Act; Air Carrier Guarantee Transportation Stabilization Board notice and public procedure are not Loan Program Under Section 101(a)(1) of the Air required pursuant to 5 U.S.C. 553(a)(2) Transportation Safety and System AGENCY: Office of Management and and (b)(B). For the same reasons, a Stabilization Act Budget, Executive Office of the delayed effective date is not required President. pursuant to 5 U.S.C. 553(a)(2) and (d)(3). AGENCY: Air Transportation Stabilization Board. ACTION: Final rule; technical This rule is not a ‘‘significant regulatory amendment. action’’ for purposes of Executive Order ACTION: Final rule. 12866, and is not a major rule under the SUMMARY: These regulations are issued SUMMARY: On October 12, 2001, the Congressional Review Act, 5 U.S.C. 801 by the Air Transportation Stabilization Office of Management and Budget et seq. Board under section 102(c)(2)(B) of the (OMB) published a final rule List of Subjects in Part 1300 Air Transportation Safety and System establishing a new chapter in the Code Stabilization Act, which authorizes the of Federal Regulations for the Aviation Air carriers, Disaster assistance, Loan Air Transportation Stabilization Board Disaster Relief-Air Carrier Guarantee programs—transportation, Reporting to issue supplemental regulations for Loan Program. This technical and recordkeeping requirements. the issuance of federal credit amendment renames the chapter Dated: March 26, 2002. instruments. The purpose of these heading and establishes a new Mitchell E. Daniels, Jr., regulations is to provide the Board with subchapter for the Office of Director, Office of Management and Budget. administrative rules and procedures Management and Budget rules to allow For reasons set forth in the preamble necessary to conduct Board business for the establishment of a subchapter for related to administering the air carrier and under the authority of 49 U.S.C. supplemental rules issued by the Air guarantee loan program. These 40101 note, the Office of Management Transportation Stabilization Board regulations are effective upon and Budget amends 14 CFR chapter VI (ATSB). publication. as follows: DATES: This technical amendment is EFFECTIVE DATE: April 9, 2002. effective April 9, 2002. CHAPTER VI—AIR TRANSPORTATION SYSTEM STABILIZATION FOR FURTHER INFORMATION CONTACT: FOR FURTHER INFORMATION CONTACT: Joseph P. Adams, Jr., Executive Director, Clare Doherty, Office of Management 1. The heading of chapter VI is Air Transportation Stabilization Board, and Budget, Washington, DC 20503. revised to read as set forth above. 1120 Vermont Avenue, NW., Suite 970, Telephone (202) 395–5704 (not a toll- 2. A new subchapter A, consisting of Washington, DC 20005, at (202) 775– free call). existing part 1300, is added to chapter 8030 or by e-mail to [email protected]. SUPPLEMENTARY INFORMATION: On VI to read as follows: SUPPLEMENTARY INFORMATION: In October 12, 2001, the OMB published a Subchapter A—Office of Management and response to terrorist attacks on final rule (66 FR 52270) under Section Budget September 11, 2001, the Federal 102(c)(2(B) of the Air Transportation Aviation Administration issued a Safety and System Stabilization Act (the PART 1300—AVIATION DISASTER Federal ground stop order that Act). The section states that ‘‘the RELIEF—AIR CARRIER GUARANTEE prohibited all flights to, from, and Director of the Office of Management LOAN PROGRAM within the United States. Airports did and Budget shall issue regulations not reopen until September 13 (except setting forth procedures for application 3. The authority citation for part 1300 for Reagan National Airport, which and minimum requirements * * * for continues to read as follows: partially reopened on October 4, 2001). the issuance of Federal credit Authority: Title I of Pub. L. 107–42, 115 At the same time, consumer demand for instruments under Section 101(a)(1)’’ of Stat. 230 (49 U.S.C. 40101 note). passenger air services declined the Act. Section 101(a)(1) authorizes the 4. Add § 1300.3 to subpart A to read significantly after the terrorist attacks. ATSB, which is established by section as follows: As a result, the U.S. commercial 102(b)(1) of the Act, to issue Federal aviation industry suffered severe losses certain credit instruments to assist air § 1300.3 Supplementary regulations of the that have placed the financial survival carriers who suffered losses due to the Air Transportation Stabilization Board. of many air carriers at risk, in part terrorist attacks of September 11, 2001, (a) The regulations in this part are because these carriers do not have and to whom credit is not otherwise supplemented by the regulations of the adequate access to credit markets. reasonably available, in order to Air Transportation Stabilization Board To address the viability of the U.S. facilitate a safe, efficient, and viable in part 1310 of this chapter in commercial aviation system, Congress commercial aviation system in the accordance with section 102(c)(2)(B) of passed, and President Bush signed into United States. the Act. law, the Air Transportation Safety and Section 102(c)(2)(B) of the Act System Stabilization Act (Pub. L. 107– (b) This part and part 1310 of this authorizes the ATSB to supplement the 42) (the Act). In Section 102(b), the Act chapter jointly govern the application regulations issued by OMB. This rule establishes the Air Transportation procedures and the requirements for restructures chapter VI of 14 CFR to Stabilization Board (the ‘‘Board’’) to issuance of Federal credit instruments facilitate the incorporation of the enter into agreements to issue loan under section 101(a)(1) of the Act. ATSB’s supplemental regulations, guarantees and other Federal credit which are published elsewhere in this [FR Doc. 02–8430 Filed 4–8–02; 8:45 am] instruments as authorized. The Board is issue of the Federal Register. This rule BILLING CODE 3110–01–P composed of the Chairman of the Board VerDate 11 of Governors of the Federal Reserve condition that makes compliance with Stabilization Act, Public Law 107–42, System or the designee of the Chairman prior notice requirements impracticable 115 Stat. 230 (Act). This part describes (who is Chairman of the Board), the and contrary to the public interest. In the Board’s authorities, organizational Secretary of Transportation or the requiring OMB to issue application structure, the rules by which the Board designee of the Secretary, the Secretary regulations within 14 days of passage of takes actions, and procedures for public of the Treasury or the designee of the the Act, Congress plainly intended to access to Board records. Secretary, and the Comptroller General ensure that the loan guarantee program or the designee of the Comptroller be implemented as swiftly as possible. § 1310.2 Composition of the Board. General (who is a nonvoting member). Moreover, OMB’s regulations permit the The Board consists of the Chairman of The Board met on September 24, 2001 filing of an application immediately. the Board of Governors of the Federal to discuss the administration of the loan The public interest is therefore served Reserve System or the designee of the guarantee program. by having these regulations become Chairman, who acts as Chairman of the On October 12, 2001, the Office of effective upon publication, so that the Board, the Secretary of the Treasury or Management and Budget (‘‘OMB’’) Board can begin operations, and air the designee of the Secretary, the published regulations in the Federal carriers can submit applications to the Secretary of Transportation or the Register (14 CFR Part 1300) regarding Board at their earliest convenience. designee of the Secretary, and the application procedures and minimum Because no notice of proposed Comptroller General of the United requirements (66 FR 52270). The Board rulemaking is required, the provisions States or the designee of the Comptroller has determined that it is appropriate to of the Regulatory Flexibility Act (5 General, who serves as a nonvoting issue supplemental administrative rules U.S.C. 601 et seq.) do not apply. It has member. The Comptroller General of the and procedures to facilitate the conduct also been determined that this rule is United States or the designee of the of Board business. These rules and not a significant regulatory action for Comptroller General, who serves as a procedures reflect the fact that the purposes of Executive Order 12866. nonvoting member, shall not be Department of the Treasury will provide involved in any of the Board’s extensive administrative services to the List of Subjects in Part 1310 discussions or deliberations in Board. The President, acting pursuant to Air carriers, Disaster assistance, Loan connection with individual loan the 2001 Emergency Supplemental programs—transportation, Reporting guarantee applications. Appropriations Act for Recovery from and recordkeeping requirements. § 1310.3 Authority of the Board. and Response to Terrorist Attacks on the Dated: April 1, 2002. United States (Pub. L. 107–38), Pursuant to the provisions of the Act, Joseph P. Adams, Jr., transferred funds to the Departmental the Board is authorized to guarantee Offices, Department of the Treasury, so Executive Director, Air Transportation Stabilization Board. loans provided to airlines by eligible that the Departmental Offices is able to lenders in accordance with the provide the necessary resources for staff, For the reasons set forth in the procedures, rules, and regulations facilities, equipment, and other support preamble and under the authority of 49 established by the Board, to make the for the Board to administer the U.S.C. 40101 note, the Air determinations authorized by the Act, guaranteed loan program for the airline Transportation Stabilization Board and to take such other actions as industry. Accordingly, the Board has amends 14 CFR chapter VI as follows: necessary to carry out its functions determined that the administrative 1. A new subchapter B, consisting of specified in the Act. operations of the Board will be part 1310, is added to chapter VI to read conducted in accordance with the as follows: § 1310.4 Offices. applicable administrative authorities of Subchapter B—Air Transportation The principal offices of the Board are the Department of the Treasury; and that Stabilization Board at 1120 Vermont Avenue, N.W., Suite the relevant administrative regulations 970, Washington, D.C. 20005. of the Department of the Treasury will PART 1310—AIR CARRIER be followed by, and applied by, the GUARANTEE LOAN PROGRAM § 1310.5 Meetings and actions of the Board. Board. ADMINISTRATIVE REGULATIONS The Board concludes that it may (a) Place and frequency. The Board Sec. publish these rules without first meets, on the call of the Chairman, in 1310.1 Purpose and scope. order to consider matters requiring obtaining public comment and without 1310.2 Composition of the Board. a delayed effective date. Section 553(a) 1310.3 Authority of the Board. action by the Board. The time and place of the Administrative Procedure Act 1310.4 Offices. for any such meeting shall be exempts from its rulemaking 1310.5 Meetings and actions of the Board. determined by the members of the requirements those agency actions that 1310.6 Staff. Board. concern ‘‘loans, grants, benefits, or 1310.7 Communications with the Board. (b) Quorum and voting. Two voting contracts.’’ 5 U.S.C. 553(a). Since the 1310.8 Freedom of Information Act. members of the Board constitute a Board’s administrative rules and 1310.9 Restrictions on lobbying. quorum for the transaction of business. 1310.10 Government-wide debarment and All decisions and determinations of the procedures concern the loan guarantee suspension. program, this issuance falls within this 1310.11 Regulations of the Office of Board shall be made by a majority vote exception to the requirements otherwise Management and Budget. of the voting members. All votes on imposed by section 553. 1310.20 Amendments. determinations of the Board required by Moreover, to the extent that section Authority: Title I of Pub. L. 107–42, 115 the Act shall be recorded in the 553’s notice-and-comment requirements Stat. 230 (49 U.S.C. 40101 note). minutes. A Board member may request may apply to this action, we conclude that any vote be recorded according to that there is ‘‘good cause’’ under § 1310.1 Purpose and scope. individual Board members. sections 553(b)(B) and 553(d) to issue This part is issued by the Air (c) Agenda of meetings. As a general the rule without prior public comment, Transportation Stabilization Board rule, an agenda for each meeting shall effective immediately. These regulations pursuant to Section 102(c)(2)(B) of the be distributed to members of the Board respond to an emergency economic Air Transportation Safety and System at least 48 hours in advance of the date VerDate 11 of the meeting, together with copies of otherwise. Any action taken pursuant to (b) Requests for records. Initial materials relevant to the agenda items. delegated authority has the effect of an determinations under 31 CFR 1.5(h) as (d) Minutes. The Chief Administrative action taken by the Board. to whether to grant requests for records Officer shall keep minutes of each Board of the Board will be made by the Chief meeting and of action taken without a § 1310.6 Staff. Administrative Officer or the designate meeting, a draft of which is to be (a) Executive Director. The Executive of such official. Requests for records distributed to each member of the Board Director advises and assists the Board in should be addressed to: Freedom of as soon as practicable after each meeting carrying out its responsibilities under Information Request, Air Transportation or action. To the extent practicable, the the Act, provides general direction with Stabilization Board, Assistant Director, minutes of a Board meeting shall be respect to the administration of the Disclosure Services, Department of the corrected and approved at the next Board’s actions, directs the activities of Treasury, 1500 Pennsylvania Avenue, meeting of the Board. the staff, and performs such other duties NW., Washington, DC 20220. (e) Use of conference call as the Board may require. (c) Administrative appeal of initial communications equipment. Any (b) Legal Counsel. The Legal Counsel determination to deny records. (1) member may participate in a meeting of provides legal advice relating to the Appellate determinations under 31 CFR the Board through the use of conference responsibilities of the Board and 1.5(i) with respect to records of the call, telephone or similar performs such other duties as the Board will be made by the Executive communications equipment, by means Executive Director may require. Director, or the delegate of such official. of which all persons participating in the (c) Chief Administrative Officer. The (2) Appellate determinations with meeting can simultaneously speak to Chief Administrative Officer sends respect to requests for expedited and hear each other. Any member so processing shall be made by the participating in a meeting shall be notice of all meetings, prepares minutes Executive Director or the delegate of deemed present for all purposes, except of all meetings, maintains a complete such official. that the Comptroller General of the record of all votes and actions taken by United States or the designee of the the Board, has custody of all records of (3) Appeals should be addressed to: Comptroller General, who serves as a the Board and performs such other Freedom of Information Appeal, Air nonvoting member, shall not participate duties as the Executive Director may Transportation Stabilization Board, in any of the Board’s discussions or require. Assistant Director, Disclosure Services, Department of the Treasury, 1500 deliberations in connection with § 1310.7 Communications with the Board. individual loan guarantee applications. Pennsylvania Avenue, NW., Actions taken by the Board at meetings Communications with the Board shall Washington, DC 20220. conducted through the use of such be conducted through the staff of the (d) Delivery of process. Service of equipment, including the votes of each Board. process will be received by the Legal member, shall be recorded in the usual § 1310.8 Freedom of Information Act. Counsel of the Board or the delegate of manner in the minutes of the meetings such official and shall be delivered to of the Board. While the Board is not part of the the following location: Legal Counsel, (f) Actions between meetings. When, Department of the Treasury, the Board Air Transportation Stabilization Board, in the judgment of the Chairman, it is follows the regulations promulgated by 1120 Vermont Avenue, NW., Suite 970, desirable for the Board to consider the Department of the Treasury at Washington, DC 20005. action without holding a meeting, the subpart A (‘‘Freedom of Information § 1310.9 Restrictions on lobbying. relevant information and Act’’) of part 1 (‘‘Disclosure of Records’’) recommendations for action may be of title 31 (‘‘Money and Finance: (a) While the Board is not part of the transmitted to the members by the Chief Treasury’’) of the Code of Federal Department of the Treasury, the Administrative Officer and the voting Regulations (CFR). The procedures of 31 regulations promulgated by the members may communicate their votes CFR 1.1 through 1.7 shall be followed Department of the Treasury at part 21 to the Chairman in writing (including an for requesting access to records (‘‘New Restrictions on Lobbying’’) of action signed in counterpart by each maintained by the Board, and title 31 (‘‘Money and Finance: Board member), electronically, or orally processing such requests. Any reference Treasury’’) of the Code of Federal (including telephone communication). in 31 CFR 1.1 through 1.7 to the Regulations (CFR), including the Any action taken under this paragraph ‘‘Department of the Treasury,’’ the appendices thereto, are applicable in has the same effect as an action taken at ‘‘Department’’ or to a ‘‘bureau,’’ shall be connection with any of the following a meeting. Any such action shall be construed to refer to the Board. In the covered Federal actions: the awarding of recorded in the minutes. If a voting event that the regulations at subpart A any Federal contract, the making of any member believes the matter should be of part 1 of title 31 of the CFR Federal grant, the making of any Federal considered at a meeting, the member subsequently are amended by the loan, the entering into of any may so notify the Chief Administrative Department of the Treasury, the Board cooperative agreement, and the Officer and the matter will be scheduled will follow those amended regulations. extension, continuation, renewal, for consideration at a meeting. The following additional information is amendment, or modification of any (g) Delegations of authority. The provided to implement 31 CFR 1.1 Federal contract, grant, loan, or Board may delegate authority, subject to through 1.7 with respect to the Board. cooperative agreement. The regulations such terms and conditions as the Board (a) Public reading room. The public promulgated by the Department of the deems appropriate, to the Executive reading room for the Board is the Treasury at 31 CFR part 21 also are Director, the Legal Counsel, or the Chief Treasury Department Library. The applicable to a request for, or receipt of, Administrative Officer, to take certain Library is located in the Main Treasury any Federal contract, grant, loan or actions not required by the Act to be Building, 1500 Pennsylvania Avenue, cooperative agreement; and to a request taken by the Board. All delegations shall NW., Washington, DC 20220. For for, or receipt of, a commitment be made pursuant to resolutions of the building security purposes, visitors are providing for the United States to insure Board and recorded in writing, whether required to make an appointment by or guarantee a loan. These terms are in the minutes of a meeting or calling 202–622–0990. defined in 31 CFR 21.105. VerDate 11 (b) In the event that the regulations at Governmentwide Requirements For of Management and Budget in part 1300 part 21 of title 31 of the CFR Drug-Free Workplace (Grants)’’) of title of this chapter in accordance with subsequently are amended by the 31 (‘‘Money and Finance: Treasury’’) of section 102(c)(2)(B) of the Act. Department of the Treasury, the Board the Code of Federal Regulations (CFR) (b) This part and part 1300 of this will follow those amended regulations. are applicable to the Board. Any chapter jointly govern the application reference in 31 CFR part 19 to the procedures and the requirements for § 1310.10 Governmentwide debarment and ‘‘Department of the Treasury’’ or the suspension. issuance of Federal credit instruments ‘‘Department’’ shall be construed to under section 101(a)(1) of the Act. While the Board is not part of the refer to the Board. In the event that the Department of the Treasury, the regulations at subpart A, B, C, D or E of § 1310.20 Amendments. regulations promulgated by the part 19 of title 31 of the CFR The procedures in this part may be Department of the Treasury at subpart A subsequently are amended by the (‘‘General’’), subpart B (‘‘Effect of adopted or amended, or new procedures Department of the Treasury, the Board may be adopted, only by majority vote Action’’), subpart C (‘‘Debarment’’), will follow those amended regulations. subpart D (‘‘Suspension’’), and subpart of the Board. Authority to adopt or E (‘‘Responsibilities of GSA, Agency and § 1310.11 Regulations of the Office of amend these procedures may not be Participants’’) of part 19 Management and Budget. delegated. (‘‘Governmentwide Debarment and (a) The regulations in this part [FR Doc. 02–8431 Filed 4–8–02; 8:45 am] Suspension (Nonprocurement) and supplement the regulations of the Office BILLING CODE 4810–25–P VerDate 11 Part V Department of Labor Pension and Welfare Benefits Administration 29 CFR Part 2520 Final Rules Relating to Use of Electronic Communication and Recordkeeping Technologies by Employee Pension and Welfare Benefit Plans; Final Rule VerDate 11 DEPARTMENT OF LABOR and in recognition of a need generally worksite locations and expanding the to update the rules governing the covered disclosures to include all Pension and Welfare Benefits distribution of disclosure materials by documents required to be disclosed Administration employee benefit plans under the under Title I of ERISA, rather than just Employee Retirement Income Security SPDs and related documents and SARs. 29 CFR Part 2520 Act of 1974, as amended (ERISA or the Expand Safe Harbor To Include Act), the Department of Labor, on RIN 1210–AA71 Distributions to Participants and January 28, 1999, published a notice of Beneficiaries Outside the Workplace Final Rules Relating to Use of proposed rulemaking and a request for Most of the commenters supported Electronic Communication and public comments on electronic expanding the safe harbor to permit the Recordkeeping Technologies by disclosure and recordkeeping issues (64 electronic delivery of documents to Employee Pension and Welfare Benefit FR 4506). In general, that notice places other than worksite locations Plans contained a proposal to expand the electronic disclosure safe harbor when a participant or beneficiary AGENCY: Pension and Welfare Benefits applicable to group health plans, at voluntarily elects to have documents Administration, Department of Labor. § 2520.104b–1(c), to all pension and furnished by such means. A number of ACTION: Notice of final rulemaking. welfare benefit plans covered by Title I these commenters suggested that any of ERISA.2 The proposal also would such electronic notice should include a SUMMARY: This document contains final expand the disclosure documents reminder to participants and rules under Title I of the Employee covered by the safe harbor to include, in beneficiaries of the need to apprise the Retirement Income Security Act of 1974, addition to summary plan descriptions plan administrator of any changes that as amended (ERISA), concerning the (SPDs) and related disclosures, the may affect the receipt of the disclosures disclosure of certain employee benefit distribution of summary annual reports (e.g., a change in e-mail address). One plan information through electronic (SARs). In addition, the notice commenter indicated that, if electronic media, and the maintenance and contained proposed standards distributions beyond the worksite are retention of employee benefit plan applicable to the use of electronic permitted at the election of participants records in electronic form. The rules media, including electronic storage and and beneficiaries, participants and establish a safe harbor pursuant to automated data processing systems, for beneficiaries should be afforded the which all pension and welfare benefit the maintenance and retention of opportunity to change their election at plans covered by Title I of ERISA may records required by sections 107 and any time. Another commenter argued use electronic media to satisfy 209 of ERISA. As with the interim rule that electronic distributions beyond disclosure obligations under Title I of for group health plans, the Department worksite locations should not be ERISA. The rules also provide standards indicated in the preamble to the included in the safe harbor because plan concerning the use of electronic media proposal that the safe harbor was not sponsors have no means of determining in the maintenance and retention of intended to represent the exclusive whether participants and beneficiaries records required by sections 107 and means by which the requirements of have the electronic technology 209 of ERISA. The rules affect employee § 2520.104b–1 may be satisfied using necessary for receiving such pension and welfare benefit plans, electronic media. Rather, electronic information. including group health plans, plan disclosures meeting the conditions of The Department is persuaded that sponsors, administrators and the safe harbor would be deemed to where participants and beneficiaries fiduciaries, and plan participants and satisfy the disclosure requirements have access to electronic information beneficiaries. under § 2520.104b–1. systems beyond the workplace (e.g., The following is an overview of the Internet-based systems) that will, as DATES: Effective Date: These regulations public comments received on the determined by the participant or are effective October 9, 2002. proposed and interim rules and the beneficiary, provide an acceptable Applicability Date: The requirements changes in the final regulations made in means by which to access plan of § 2520.107–1 apply as of the first day response to the comments. information, neither plans nor of the first plan year beginning on or participants and beneficiaries should be after October 9, 2002. B. Disclosure Through Electronic discouraged from utilizing such systems Media—29 CFR 2520.104b–1(c) FOR FURTHER INFORMATION CONTACT: for plan-related communications. Katherine D. Lewis, Office of As proposed, the availability of the Accordingly, the Department has Regulations and Interpretations, Pension safe harbor was limited to participants modified and expanded the safe harbor and Welfare Benefits Administration, who have effective access to to encompass electronic delivery of plan U.S. Department of Labor, 200 electronically furnished documents at information beyond the workplace to Constitution Avenue, NW, Washington, their work place. Most of the participants, beneficiaries and other DC, 20210, (202) 693–8523 (not a toll- commenters supported broadening the persons entitled to disclosures under free number). scope of the safe harbor to encompass Title I of ERISA where, as discussed SUPPLEMENTARY INFORMATION: disclosures to individuals (i.e., both below, certain conditions designed to participants and beneficiaries) beyond protect participants, beneficiaries and A. Background such other persons are satisfied. Pursuant to section 1510(a) of the and administrators of retirement plans. Pub. L. 105– Because the proposal was limited to the 34, enacted August 5, 1997. 1 furnishing of information electronically Taxpayer Relief Act of 1997 (TRA ‘97) 2 The safe harbor was established in an interim rule for group health plans published in the Federal to individuals at worksite locations, the 1 Section 1510(a) of the TRA ’97 directs the Register on April 8, 1997 (62 FR 16979). The proposed safe harbor necessarily Secretary of Labor and the Secretary of the Treasury Department received five comments on the interim applied only to disclosures furnished to to issue guidance designed to interpret the notice, rule that addressed electronic disclosure issues. The participants. With the expansion of the election, consent, disclosure, time requirements, proposed and interim rules are being finalized and related recordkeeping requirements of ERISA concurrently in this document to facilitate safe harbor to include the electronic and the Internal Revenue Code, respectively, as consideration of the full range of issues raised by distribution of documents beyond applied to the use of new technologies by sponsors public comments. worksite locations, the Department sees VerDate 11 no basis for continuing to limit the safe is otherwise provided notice of the to whom disclosures will be made harbor to participants. availability of a document, requiring electronically. The established As revised, the safe harbor applies to participants to physically seek out the conditions take into account both communications through electronic documents in common areas of the suggestions of the commenters and media with two categories of workplace will be a disincentive for provisions of the Electronic Signatures individuals (described in paragraph participants to obtain and review in Global and National Commerce Act (c)(2) of § 2520.104b–1). The first important information affecting their (the E–SIGN Act) relating to consumer category of individuals is participants rights, benefits, and obligations under disclosure and consent with regard to who, similar to the proposed safe their plan. Accordingly, while the use of electronic communications.4 harbor, have the ability to effectively electronic information systems in As expanded, the safe harbor access documents furnished in common areas of the workplace may be conditions electronic communications electronic form at any location where an appropriate means by which to make beyond the workplace on the individual the participant is reasonably expected to plan information available for to whom disclosure is being made perform his or her duties as an inspection, as a supplemental method of affirmatively consenting to receive employee and with respect to whom disclosure, or as a way to access documents electronically. In the case of access to the employer’s or plan additional non-mandated materials, it is documents to be furnished through the sponsor’s electronic information system not an appropriate means by which to Internet or other electronic is an integral part of those duties. See deliver documents required to be communication network, the individual § 2520.104b–1(c)(2)(i). The second furnished to participants. must, in addition to providing an category of individuals is participants, Second, the Department has address for the receipt of documents beneficiaries and other persons entitled eliminated the requirement that electronically, consent or confirm to plan disclosures under Title I of participants have the opportunity to consent electronically in a manner that ERISA who consent to receiving readily convert furnished documents reasonably demonstrates the documents electronically. A discussion from electronic form to paper form free individual’s ability to access of comments received and the of charge. A number of commenters information in the electronic form that application of the regulation to each of questioned the need for this will be used. Such confirmation will not these categories follows. requirement if participants have the only ensure the compatibility of the The provisions governing the first ability to obtain paper versions of hardware and software of the individual category of individuals have been electronically furnished documents. and the plan, but will also serve to modified from the proposal in two Commenters also raised questions as to evidence that the administrator has respects. As indicated by the foregoing the application of this requirement taken appropriate and necessary description, the Department has when employees are on travel or measures reasonably calculated to eliminated use of the term ‘‘worksite,’’ worksite locations where printers are ensure that the system for furnishing but has retained the general concept. In not readily available. The Department is documents results in actual receipt, as this regard, the revised language—‘‘any persuaded that this requirement is not required by paragraph (c)(1)(i)(A). See location where a participant is necessary where participants have the § 2520.104b–1(c)(2)(ii)(B). The reasonably expected to perform his or right to request and obtain paper requirement for an e-mail address and her duties as an employee’’—is intended versions of the electronically furnished electronic confirmation would not apply to make clear that the safe harbor documents.3 where the means of electronic extends to employees who work at The second category of individuals to communication is via CD, DVD or home or who may be on travel, provided whom documents may be furnished similar media not dependent on that they have ready access to the electronically under the expanded safe electronic transmission of the employer’s information system. harbor is participants, beneficiaries and documents to the participant or Some commenters recommended other persons entitled to disclosure beneficiary. See § 2520.104b– eliminating the requirement that access documents under Title I who consent to 1(c)(2)(ii)(A) to the employer’s or plan sponsor’s receive such documents electronically. As noted earlier, making electronic information system be an integral part of See § 2520.104b–1(c)(2)(ii). The information systems available in the participant’s duties. The furnishing of documents to this category common areas of the workplace (e.g., commenters argued that the availability of individuals assumes the furnishing of computer kiosks) is not, in the of a computer kiosk in a common area documents electronically beyond the Department’s view, a permissible means at a participant’s workplace should be workplace and, therefore, the utilization by which to deliver documents required sufficient to satisfy the access of electronic information systems to be furnished to participants. requirement. The Department disagrees. beyond the control of the plan or plan In an effort to ensure that all parties As stated in the proposal, the sponsor. For this reason, the safe harbor understand the nature of, and Department believes that the actual establishes conditions that are intended requirements for, such communications, location of an employee’s work is less to ensure the adequacy of the reliance on the safe harbor also is important than the employee being information system for the individuals conditioned on the individual being expected to regularly access the provided, prior to his or her consent, a employer’s electronic information 3 If a document is required by the Act, or clear and conspicuous statement system and, therefore, more likely to regulations issued thereunder, to be furnished containing certain specified receive timely communication of plan without charge to participants and beneficiaries, information. The statement must information. The Department has long plan administrators availing themselves of the safe harbor must furnish to participants and identify the documents or categories of held the view that, where documents beneficiaries without charge a paper version of any documents to which the consent would are required to be furnished to such document transmitted electronically. On the apply; explain that consent may be participants, it is not acceptable merely other hand, if an administrator is permitted to withdrawn at any time without charge; to make the documents available in a impose a reasonable charge for a document, the administrator may impose a reasonable charge for describe procedures for withdrawing location frequented by participants. See furnishing a paper version of the document under § 2520.104b–1(b). The Department this safe harbor (§ 252.104b–1(c)). Also see: 29 CFR 4 Pub. L. 106–229, 114 Stat. 464 (2000) (codified believes that, even where a participant 2520.104b–30. at 15 U.S.C. 7001 et seq.) VerDate 11 consent or updating address or other expanded in the final regulation to general application of the standards information; explain the right of the include additional disclosures required under § 2520.104b–1 was most recently individual to request and obtain a paper under Title I of ERISA. The commenters recognized by the Department in the version of the electronically furnished specifically identified: individual revised claims procedure regulations document(s), including whether the benefit statements under section 105(c) adopted on November 21, 2000. In those paper version will be provided free of of ERISA; investment-related regulations, the Department specifically charge; and identify any software and information required to be provided to referenced the applicability of the hardware requirements to access and participants and beneficiaries in the electronic distribution safe harbor retain the identified documents to be case of plan fiduciaries seeking to be standards set forth in paragraph (c) of provided electronically. The covered by section 404(c) of ERISA; § 2520.104b–1 to benefit Department believes that the foregoing COBRA notifications under sections 606 determinations.6 For these reasons, the will provide participants and of ERISA; qualified domestic relations Department believes it is appropriate to beneficiaries with the basic information order (QDRO) notifications under amend § 2520.104b–1 to apply to necessary to make an informed decision section 206(d)(3) of ERISA; qualified disclosures under Title I generally, about receiving documents medical child support order (QMCSO) rather than limiting its application to electronically. notifications under section 609 of disclosures of SPDs and related The Department recognizes that there ERISA; information concerning disclosures and SARs. In this regard, the may be additional information that participant loans under section Department is making conforming administrators believe should or must 408(b)(1) of ERISA; and information amendments to paragraphs (a) and (b) of be communicated in conjunction with required to be furnished or made § 2520.104b–1 to accommodate the this disclosure, including, as suggested available for inspection under sections extension of the safe harbor to Title I by commenters, an explanation of the 104(b)(2) and 104(b)(4) of ERISA in disclosures generally, as well as clarify importance of keeping the plan or plan response to a request from a participant that the provisions of the regulation, sponsor apprised of changes that may or beneficiary. including the safe harbor, do not extend affect the communication of plan The Department is persuaded that, to disclosures within the jurisdiction of information. The requirements for a with safeguards to protect the the Department of the Treasury. clear and conspicuous statement are not confidentiality of personal information, The Department wishes to note that, intended to limit the ability of plan the safe harbor should be expanded to while the scope of § 2520.104b–1 is administrators to include information, include the transmittal of all documents being expanded to encompass the in addition to that required, they believe required to be furnished or made distribution of plan disclosures to is important to participants and available under Title I of ERISA and the participants, beneficiaries, and certain beneficiaries, but rather to ensure that regulations issued thereunder that are other individuals under Title I, the the communicated information is both within the jurisdiction of the distribution standards of revised brought to the attention of the electing Department of Labor.5 In this regard, the § 2520.104b–1 do not alter any individual and set forth in a reasonably Department believes that the general requirements otherwise applicable to understandable manner. standard applicable to the distribution specific disclosures, such as the party to Recognizing that there may be system of documents under § 2520.104b–1(b)— whom the disclosure must be made, the or other changes that may affect the requiring plan administrators to use content of the disclosure, or the timing electronic furnishing of documents, the measures reasonably calculated to of the disclosure. The Department also safe harbor requires that where there are ensure actual receipt—would appear notes that the standards of revised changes in hardware or software that generally applicable to documents § 2520.104b–1 are limited to plan may create a material risk that an required to be distributed under Title I. disclosures under Title I of ERISA and individual will not be able to access The Department notes that when do not govern other communications documents electronically, the § 2520.104b–1 was originally adopted in under Title I, for example, individual must be provided a statement 1977, the primary disclosure documents communications from participants or of the revised hardware or software under Title I were set forth in Part 1 of beneficiaries (such as spousal consents), requirements for access to and retention Title I. Since that time, the statute has or between plan administrators and of electronically furnished documents, been amended to incorporate disclosure employers or other plan sponsors. as well as the right to withdraw consent and notice requirements relating to Currently, the manner in which without charge. Following notice of the qualified domestic relations orders applicants may notify interested persons hardware or software changes and the under Part 2, qualified medical child of the pendency of a proposed right to withdraw consent, the support orders under Part 6, exemption from ERISA’s prohibited individual must again affirmatively continuation coverage rights under Part transaction provisions, including the consent to receive documents 6, and creditable coverage and related use of electronic media, is determined electronically. This condition is disclosures under Part 7 of Title I, and on a case-by-case basis under 29 CFR intended to afford participants and the Department has adopted regulations 2570.43. The Department is considering beneficiaries the opportunity to fully under section 404(c), among others. The the applicability of the safe harbor assess and reconfirm the compatibility provided by this rule to that notice of the system changes with their ability 5 The Department notes that § 2510.104b–1, requirement. In this regard, the to access and retain documents. including the provisions of the safe harbor, do not extend to certain disclosures required under Department invites interested parties to Expand Scope of Safe Harbor To Cover provisions of Part 2 or Part 3 of the Act over which submit comments and views concerning Other Disclosures the Department of the Treasury has regulatory and the application of the safe harbor to interpretative authority pursuant to Reorganization such notifications. Comments should be As proposed, the safe harbor covered Plan No. 4 of 1978. A new paragraph (e) has been the distribution of SPDs, summaries of added to the final regulation to note this limitation. addressed to the Office of Exemption changes to the SPD and summary Plan administrators and others should refer to regulations and guidance issued by the Department 6 See 29 CFR 2560.503–1(g)(1), providing that annual reports. Many commenters of the Treasury for information on the use of electronic notifications of benefit determinations requested that the scope of the safe electronic communication technologies to satisfy must comply with the requirements of § 2520.104b– harbor for electronic disclosures be disclosure obligations within its jurisdiction. 1(c)(1). VerDate 11 Determinations, Room N–5649, Pension It is the Department’s view that the is being expanded to encompass and Welfare Benefits Administration, standard for furnishing materials under disclosures under Title I generally. U.S. Department of Labor, 200 § 2520.104b–1 should not be stricter for Paragraph (c)(1)(iii) of the proposal Constitution Avenue, NW, Washington, electronic disclosures than for other further conditions reliance on the safe DC 20210; Attention: ‘‘Electronic Notice methods of delivery. Rather, the safe harbor on each participant being to Interested Persons.’’ Comments harbor criteria are intended to extend provided notice of the documents being should be submitted by June 30, 2002. the application of the general standards furnished electronically, the The Department expects to complete its of § 2520.104b–1(b) to electronically significance of the documents and the consideration of this issue no later than distributed documents. For example, participant’s right to request and receive December 31, 2002. utilization of mail delivery, whether a paper version free-of-charge. Recognizing that certain information first, second or third class, for Paragraph (c)(1)(iii) served to require required to be disclosed under Title I, distribution of documents anticipates that, upon request, individuals are such as individual benefit and claims the sender (i.e., the plan administrator) furnished paper versions of the electronically furnished documents. information, may be confidential in being apprised of address changes or While a number of commenters nature, the Department is amending the non-delivery of the mailed documents. supported the ‘‘notice of furnished general standards of the safe harbor, at This condition is being adopted paragraph (c)(1)(i), to require that, with documents’’ condition, one commenter essentially as proposed, except that, as suggested that the Department permit respect to disclosures that relate to discussed above, the paragraph has been individuals and their accounts and such notices to be included as part of amended to require protection of regular mailings or e-mails (e.g., with benefits, the administrator must take personal information and, as suggested appropriate and necessary measures to account statements) annually. The by one commenter, an example of required notice is intended to bring to ensure that the system for furnishing ‘‘notice of undelivered electronic mail’’ such information protects the the attention of participants and has been added to paragraph (c)(1)(i) of beneficiaries at the time of the confidentiality of the information, such § 2520.104b–1. electronic disclosure that they have as by incorporating into the system been furnished important plan measures designed to preclude Another general condition for reliance information. The Department believes unauthorized receipt of, or access to, the on the safe harbor is that electronically that merely furnishing a general notice information by individuals other than delivered documents are prepared and on a periodic basis would not the individual for whom the furnished in a manner consistent with accomplish this goal. For purposes of information is intended. The the applicable style, format, and content the safe harbor, therefore, the Department is not prepared at this time, requirements. See § 2520.104b– Department believes that the timing of however, to express any view as to the 1(c)(1)(ii). A few commenters asked that the notice must be governed by the time adequacy of any particular method the Department clarify whether differences in format between a paper frame applicable to the required designed to protect confidentiality, such disclosure, and paragraph (c)(1)(iii) has as the use of PINs or passwords. version and an electronic version of SPDs are permitted so long as the been modified to make this clear. General Obligations of Administrator content, form, style and other Nothing in the safe harbor, however, is intended to preclude the furnishing of The general obligations of a plan requirements applicable to SPDs are satisfied. Another commenter noted that the required notice with other administrator with respect to the information relating to the plan or plan distribution of documents electronically the proposal indicated that participants and beneficiaries had a right to request sponsor. In such cases, however, care under the safe harbor are set forth in should be taken to ensure that the paragraph (c)(1) of § 2520.104b–1. As paper ‘‘copies’’ of electronic disclosures, and expressed concern that the use of required notifications are sufficiently proposed, the administrator is required conspicuous to alert participants and interactive technologies, multimedia to take appropriate and necessary beneficiaries to electronically furnished presentations and hyperlinks in measures to ensure that the system for documents. The Department has also electronic disclosures would be severely furnishing documents results in actual clarified that the requirement that the limited if the safe harbor required paper receipt of transmitted information and notice apprise each participant and documents. The proposal included the and electronic documents to be beneficiary of the significance of the following examples of such measures: identical. Neither the safe harbor nor the document being provided electronically using return-receipt electronic mail content, style and format requirements applies only where the significance of features; or conducting periodic reviews applicable to disclosures under the Act the document may not be reasonably or surveys to confirm receipt of preclude the use of interactive evident from the transmittal, such as transmitted information. See technologies, multimedia components where it is an attachment to an e-mail. § 2520.104b–1(c)(1)(i). Some or hyperlinks to related materials in The Department received several commenters asked whether this electronic disclosures. Moreover, the comments suggesting that there is requirement was intended to impose a Department recognizes that electronic unneeded redundancy in the standard for ensuring electronic disclosures and paper versions of the requirement that participants have the disclosures are received that is stricter required disclosure documents may ability at the workplace to readily than the standard that applies to other differ. In the Department’s view, the convert furnished documents from methods of delivery. Another requirements of the safe harbor will be electronic form to paper form free of commenter asked the Department to add satisfied where the electronic and paper charge, when they must also be advised electronic systems that notify the sender versions of a disclosure document, of and afforded the opportunity to of ‘‘undelivered’’ e-mails as an example albeit different, each satisfy the style, obtain paper versions of the furnished in the regulation. Other commenters format and content requirements documents from the plan administrator requested that the safe harbor be limited applicable to the specific document free of charge. As discussed earlier, that to electronic communications that the when viewed independently. Paragraph requirement has been eliminated from plan administrator could prove were (c)(1)(ii) has been only slightly modified the safe harbor. For a variety of reasons actually received by the participant. to take into account that § 2520.104b–1 (e.g., malfunctioning hardware or VerDate 11 software, readability, portability), page of the publication advising readers C. Electronic Recordkeeping—29 CFR however, documents furnished in that the publication contains important 2520.107–1 electronic form may not accommodate information about rights under the plan. Proposed regulation 29 CFR the needs of every participant or A plan administrator relying on such 2520.107–1 provided standards beneficiary on every occasion. website disclosure must still satisfy all concerning the use of electronic media, Accordingly, the Department continues the conditions of the safe harbor. For including electronic storage and ADP to believe that the ability of participants example, participants and beneficiaries systems, for the maintenance and and beneficiaries to receive paper would have to be notified of the retention of records required by sections versions of electronically furnished availability of the particular disclosure 107 and 209 of ERISA. Only a few documents is important to ensuring document and its significance by comments were submitted regarding the adequate disclosure to participants and sending written or electronic notice, as recordkeeping provisions in proposal, beneficiaries. The Department, described in § 2520.104b–1(c)(1)(iii), and, in general, they asked for relatively therefore, has retained the requirement minor clarifications of certain to make paper versions of electronically directing them to the document on the website, and the administrator would provisions in the proposal. Accordingly, furnished documents available to the final rule being adopted herein is participants and beneficiaries.7 still be required to take appropriate and essentially unchanged from the Because the scope of the safe harbor, necessary measures to ensure the proposal. and § 2520.104b–1, have been expanded website system for furnishing to encompass all Title I disclosures documents results in actual receipt, e.g., In General generally, the safe harbor has been the website homepage should contain a The final rule provides that electronic modified to eliminate the requirement prominent link to the website sections media may be used for purposes of that paper versions of documents that contain information about the plan, complying with the records always be furnished free-of-charge. As the website should include directions maintenance and/or retention noted above, however, if a document is on how to obtain a replacement for a requirements of sections 107 and 209, required by the Act, or regulations lost or forgotten password to the extent provided: (1) The recordkeeping system issued thereunder, to be furnished one is needed, and disclosure has reasonable controls to ensure the without charge to participants and documents should remain on the integrity, accuracy, authenticity and beneficiaries, plan administrators website for a reasonable period of time reliability of the records kept in availing themselves of the safe harbor after participants and beneficiaries are electronic form; (2) the electronic must furnish to participants and notified of their availability. records are maintained in reasonable beneficiaries without charge a paper order, in a safe and accessible place, and version of any such document Another commenter asked whether in such manner as they may be readily transmitted electronically. On the other documents could be furnished on a inspected or examined (for example, the hand, if an administrator is permitted to magnetic disk or CD–ROM. The recordkeeping system should be capable impose a reasonable charge for a regulation does not categorize particular of indexing, retaining, preserving, document, the administrator may electronic media as either permissible or retrieving and reproducing the impose a reasonable charge for impermissible methods through which electronic records); (3) the electronic furnishing a paper version of the required disclosures may be provided as records can be readily converted into document under the safe harbor. long as the conditions of the safe harbor legible and readable paper copy as may Miscellaneous Issues Involving the Use are met. For example, as noted above, be needed to satisfy reporting and of Electronic Media under the safe harbor, participants and disclosure requirements or any other beneficiaries must be provided with a obligation under Title I of ERISA; and Two commenters asked the notice in accordance with § 2520.104b– Department to clarify whether the safe (4) adequate records management 1(c)(1)(iii) apprising them of the harbor would apply to disclosures of practices are established and document(s) to be furnished plan information maintained in a implemented (for example, following electronically, the significance of the separate section of a company’s website procedures for labeling of electronically that is easily accessible from its home document (e.g., the document describes maintained or retained records, page with access generally restricted to changes in the benefits provided by providing a secure storage environment, employees and others by password and your plan) and the participant’s or creating back-up electronic copies and PIN requirements. The Department beneficiary’s right to request and receive selecting an off-site storage location, believes that using a company’s website a paper version of each such document. observing a quality assurance program as a method of providing information is The purpose of the notice requirement evidenced by regular evaluations of the similar to using an insert to a company is to ensure that participants and electronic recordkeeping system publication, which is cited in the beneficiaries who receive an electronic including periodic checks of general standard in 29 CFR 2520.104b– disclosure will be put on notice that the electronically maintained or retained 1(b) as an acceptable method of communication contains important records, and retaining paper copies of ‘‘furnishing’’ disclosures within the information relating to their plan or to records that cannot be clearly, meaning of the regulation provided the their rights and obligations under the accurately or completely transferred to 8 distribution list for the periodical is plan. Thus, a plan administrator could an electronic recordkeeping system). comprehensive and up-to-date and a provide a participant with a CD–ROM 8 The proposed standards are not inconsistent prominent notice appears on the front containing the plan’s SPD, for example, with guidance issued by the Internal Revenue so long as the CD–ROM was Service under section 6001 of the Internal Revenue 7 As discussed earlier with regard to the accompanied by a paper notice or was Code of 1986 regarding the maintenance of books application of style, format and content and records on an electronic storage system or requirements, paper documents are not required to clearly labeled to provide the within an ADP system. See Rev. Proc. 97–22, 1997– be duplicates of the electronically furnished notification required by § 2520.104b– 13 I.R.B. 9, and Rev. Proc. 98–25, 1998–11 I.R.B. 7. document. In an effort to further clarify this point, 1(c)(1)(iii) and the other conditions in The Department also notes that the regulation does the term ‘‘paper version’’ has been substituted for not specifically address the use of microfilm and ‘‘paper copy’’ in § 2520.104b–1(c)(1)(iii). the safe harbor were satisfied. microfiche for storing employee benefit plan VerDate 11 The final rule also provides that the satisfy reporting, disclosure and other unless the resulting electronic record electronic recordkeeping system may obligations under Title I of ERISA. would not constitute a duplicate or not be subject to any agreement or This final rule is consistent with the substitute record under the terms of the restriction that would, directly or goals of the E-SIGN Act and is designed plan and applicable federal or state law. indirectly, compromise a person’s to facilitate voluntary use of electronic Miscellaneous Comments Regarding ability to comply with any reporting and records while ensuring continued Matters Outside the Scope of This disclosure requirement or any or other accuracy, integrity and accessibility of Rulemaking obligation under Title I of ERISA. In employee benefit plan information and addition, the final rule provides records required to be kept by law. The One commenter asked the Department guidance on when original paper requirements of the final rule are to provide guidance on the types of records may be discarded after they justified by the importance of the records that must be retained for have been transferred to electronic employee benefit plan records involved, purposes of sections 107 and 209. As media. are substantially equivalent to the the Department explained in the The Department again emphasizes requirements imposed on records that preamble to the proposed regulation, the what it stated in the preamble to the are not electronic records, will not purpose of this rulemaking is not to notice of proposed rulemaking that the impose unreasonable costs on the define or address the types of records duty to maintain records in accordance acceptance and use of electronic required to be maintained under with Title I of ERISA cannot be avoided records, and do not require, or accord sections 107 and 209, nor the period of by contract, delegation or otherwise. greater legal status or effect to, the time for which records must be retained Use of a third party to provide an implementation or application of a under those sections of the Act. electronic recordkeeping system does specific technology or technical Accordingly, the Department is not not relieve the person responsible for specification for performing the making any changes in the proposal in the maintenance and retention of functions of creating, storing, response to that comment because that records required under Title I of ERISA generating, receiving, communicating, issue is outside the scope of this of the responsibilities described therein. or authenticating electronic records. rulemaking. For example, if the administrator of a Another commenter asked the Destruction of Paper Records After Department to explain whether the plan arranges with a service provider to Converting to Electronic Form perform functions with respect to the standards in the safe harbor regarding plan and, pursuant to the arrangement, One commenter asked the Department ‘‘back-up’’ electronic records and off- the service provider creates, maintains, to clarify the proposal regarding site storage apply when records are retains or prepares the plan’s records, or destruction of originals. The proposal maintained in paper form. It is the view keeps physical custody of those records, provided that original records generally of the Department that, regardless of the statutory requirements relating to may be discarded once such records are whether records are held in paper or such records remain with the transferred to an electronic electronic form, the appropriate plan administrator, and the administrator recordkeeping system that complies fiduciary or fiduciaries should establish must make such agreements and with the above described electronic and implement adequate records arrangements with the service provider media and record maintenance management practices. What is as are necessary to ensure that the requirements, but included an exception ‘‘adequate’’ may vary depending on the records are properly maintained and under which original records may not recordkeeping system involved and the be discarded if they have legal retained.9 different risks of loss or destruction to Furthermore, it is the Department’s significance as original records such which the records or recordkeeping view that persons subject to that an electronic record would not medium may be exposed. Nonetheless, recordkeeping obligations under section constitute a duplicate record. The regardless of the medium used to keep 107 and section 209 of ERISA would, commenter urged that the term ‘‘legal records, the loss or destruction of pursuant to the Department’s significance’’ be dropped because it records required to be retained by investigative authority under section could be interpreted as applying to sections 107 and 209 does not discharge many documents and records. The 504 of ERISA, be required to provide the the persons required to retain such commenter also suggested that the Department, upon request, with the records from their statutory duties examples in the proposal (notarized necessary equipment and resources under sections 107 and 209 with regard documents, insurance contracts, stock (including software, hardware and to the purposes for which such records certificates, and documents executed personnel) as would be needed for are required to be retained under those under seal) would require plans to keep inspection, examination and conversion sections. Whether lost or destroyed paper copies where electronic of electronic records into legible and records can, or should be, reconstructed reproductions were sufficient. and whether the persons responsible for readable paper copy or other usable On review, the Department has form acceptable to the Department. the retention of records are, or should determined that the ‘‘legal significance be, personally liable for the cost Similarly, such persons would be as an original’’ component in the required to have the capability of incurred in connection with the proposal may have been confusing reconstruction of records is necessarily converting electronic records into because it was essentially redundant to usable form, including, at a minimum, dependent on the facts and the condition that the electronic record circumstances of each case. paper copy, as may be necessary to be usable as a duplicate original. Accordingly, the ‘‘legal significance’’ D. Effective Date and Applicability records. The Department previously addressed this Dates issue in an information letter to Gregg M. Goodman component has been eliminated and the from Robert J. Doyle (August 23, 1983). The letter exception has been clarified to provide The effective date of these regulations stated that, in the absence of regulations providing that original paper records may be is October 9, 2002. There is no special otherwise, the retention of microfilm, microfiche or disposed of any time after they are applicability date for the amendments of similar reproduction of records, in lieu of original records, would not violate the provisions of section transferred to an electronic § 2520.104b–1, and, accordingly, those 107 or 209 provided certain conditions were met. recordkeeping system that complies amendments apply as of the effective 9 See Advisory Opinion 84–19A (April 26, 1984). with the requirements of § 2520.107–1, date stated above. The requirements of VerDate 11 § 2520.107–1, concerning maintenance outside the workplace. No other new consent to receive electronic and retention of employee benefit plan costs were attributed to the adoption of disclosures. The Department included records in electronic form, are new technologies, reflecting the in its savings estimates only disclosures applicable as of the first day of the first Department’s expectations that (1) that are directed at participants and plan year beginning on or after October master copies of printed versions of include no information specific to 9, 2002. The preamble accompanying disclosures typically are maintained in individuals, reasoning that such the Proposed Rules set forth the electronic form or can be easily disclosures might be the first to which Department’s view that, in the absence converted to such form, (2) that plan new technologies are applied. In of final regulations or other guidance on sponsors will provide disclosures via combination, these assumptions suggest using electronic media for purposes of electronic media and infrastructure that that the printing, materials and mailing complying with ERISA’s Title I already exist for purposes other than the costs associated with relevant ERISA disclosure and recordkeeping provision of ERISA disclosures, and (3) disclosures will be reduced by requirements, good faith compliance that the cost to transmit disclosures approximately 14 percent in the first with the standards set forth in the electronically is negligible. year in connection with this final Proposed Rules would, with respect to Most of the $74 million in gross regulation (or 27 percent in connection the disclosure and recordkeeping savings is attributable to expected with the proposed and final regulations requirements specifically addressed electronic provision of SPDs and SMMs, together). The electronic provision of therein, constitute compliance with a and SARs to participants outside the ERISA disclosures and the reasonable interpretation of 29 CFR workplace. These applications of new corresponding amount of savings is 2520.104b–1 and ERISA sections 107 technologies are expected to save $34 likely to grow in the future, as and 209. The preamble also made clear million and $32 million, respectively. participants’ access to, and comfort that the interim rule pertaining to SPDs/SMMs can be large documents, so with, electronic media both at work and electronic disclosures continued to be in electronic provision can eliminate at home increases, as plans’ use of such effect for group health plans during the substantial printing, materials, and media expands, and as some sponsors pendency of the proposal. The final mailing costs. SPDs/SMMs and SARs apply new technologies more broadly to regulations being promulgated in this are also some of the most widely disclosures to beneficiaries or former rulemaking will, upon becoming distributed ERISA disclosure participants or to disclosures that applicable, supersede and replace the documents, thus offering significant include information specific to interim rule for group health plans and potential for the reduction of individuals. the good faith compliance provision in distribution costs. The final regulation is also expected the proposal. Not included in the $74 million gross to improve the timeliness, quality and savings estimate is an additional $65 accessibility of information for E. Economic Impact of Electronic million in savings from the electronic Technologies Regulation participants and beneficiaries. provision of SPDs/SMMs and SARs to Timeliness will improve as delays Summary participants at the workplace that were attributable to printing and mailing are These final rules expand the safe authorized by the safe harbor provision eliminated. In addition, the frequency 10 harbor for electronic provision of ERISA of the proposed regulation. Savings with which SPDs are updated to reflect disclosure documents to include both arising from them are not being changes may increase as the cost to more documents and more delivery attributed to this final regulation. Also provide updated copies falls. The locations. As a result of these final rules, not included is any savings from the quality and accessibility of information plans will be in a position to make adoption of electronic recordkeeping. may improve along many dimensions. greater use of electronic technologies The Department believes that the final Information access tools such as hot- when providing required disclosures to regulation’s standards for electronic links and search queries may help participants and beneficiaries. Wider recordkeeping are consistent with participants retrieve desired information use of such technologies will produce reasonable and prudent business from SPDs and other documents. Multi- two distinct economic benefits. One practices that are already widely media enhancements may present benefit will be financial savings arising followed, and therefore are unlikely to information in ways some participants from the elimination of materials, substantially change recordkeeping find more accessible, comprehensible or printing, and mailing costs associated costs. appealing. The value of these benefits with provision of printed disclosures. The Department’s estimates reflect its cannot be specifically quantified. expectations about the degree to which The other will be improved timeliness, Basis for Savings Estimates quality and accessibility of information disclosures will be provided that will flow from instant, on-line electronically under the final regulation. As a result of this final regulation, availability and information access tools Approximately 21 percent of plans will be in a position to make such as hot-links and search queries. participants currently have appropriate greater use of electronic technologies The net savings produced by moving access to electronic media at their work when providing required disclosures to from printed to electronic disclosures places, and another 38 percent have participants and beneficiaries. Wider under this regulation will be such access at home, the Department use of such technologies will produce approximately $66 million in the first estimates. For purposes of these financial savings by eliminating some of year, the Department estimates. This net estimates, the Department assumed that the materials, printing, and mailing figure includes a total of $74 million in a large majority of plans will adopt new costs normally associated with annually recurring gross savings from technologies, and approximately three- provision of printed disclosures. As the elimination of materials, printing, fourths of participants with access to noted above, the Department estimates and mailing costs. This gross savings is electronic media only at home will that net savings produced by moving partly offset in the first year by an $8 from printed to electronic disclosures 10 See footnote 13 and accompanying text, infra, million cost incurred to obtain affected for a discussion of the difference between this $65 under this regulation will be participants’ consent to accept million estimate and the estimated saavings in the approximately $66 million in the first electronic delivery of disclosures preamble to the proposal. year. VerDate 11 The Department’s estimates of Based on a Census Bureau household participants and beneficiaries are not financial savings from the final survey published in 200111 on computer active employees, they will not have regulation are grounded in its separate use and a separate 1999 Census Bureau access to electronic media at the estimates of the cost to provide relevant household survey on pension and workplace. Therefore, for example, the ERISA disclosures in printed form. For health benefit plan participation,12 the Department assumed that sponsors who purposes of compliance with the Department estimates that adopt new technologies will Paperwork Reduction Act, the approximately 21 percent of electronically distribute SPDs/SMMs, Department maintains estimates of the participants have appropriate access to SARs, ERISA Section 404(c)-related cost to prepare and distribute such electronic media at their work places, disclosures, and ERISA Section 701- disclosures. Preparation costs generally and another 38 percent have such access related notices of special enrollment include the cost to develop the content at home. The pension and health rights and preexisting condition and format of the disclosure, while coverage rates from the 1999 survey exclusions, but not ERISA Section 701- distribution costs generally include the were applied to the computer use rates related certificates of prior coverage or materials, printing and mailing cost industry-by-industry to account for the Section 606-related notices of COBRA incurred to provide the disclosures to likelihood that computer use is higher continuation rights. Moreover, the Department participants and beneficiaries as among plan participants and especially among large plan participants, because conservatively assumed that plans required. such participants are concentrated in would distribute electronically only The Department’s estimates assume certain industries. disclosures that contain no potentially that preparation costs will be The Department assumed that a large sensitive information specific to unchanged by the final regulation. This majority of plans with participants who individuals, which might raise privacy assumption reflects the Department’s have access to electronic media (or their concerns. For example, the Department belief that master copies of printed service providers) will adopt new did not assume that plans would versions of disclosures typically are technologies as a means to provide at electronically distribute notices and maintained in electronic form or can be least some relevant ERISA disclosures. disclosures pertaining to individual easily converted to such form. Some This may be especially true of large claims for benefits or qualified domestic plan sponsors may elect to develop new plans, which account for the lion’s share relations orders. formats and content for electronic of participants. Pension plans with These assumptions are intended to disclosures. New formats and content 1,000 or more participants included address what the Department estimates might include interactive interfaces that nearly three-fourth of all participants in as the likely impact of the final rules involve hot-links, text search 1997. Similar data are not available for based on existing practices in the capabilities, and/or multimedia welfare plans. The Department also current environment. Such assumptions presentations, all of which might assumed that plan sponsors (or their should not be interpreted as bearing on improve the timeliness, quality and service providers) would be more actions specifically permitted under the accessibility of information for inclined to provide disclosures final rules. To the extent that plans do provide electronic disclosures to former participants. However, the final electronically at work than outside the participants or beneficiaries or do regulation does not require the workplace, because communication at the workplace might be viewed as more electronically distribute disclosures development of formats or content reliable and the final regulation requires containing sensitive, individual-specific beyond that which satisfies disclosure no consent from participants before information as permitted by the final requirements in printed form. implementation of such disclosures. rules, then the overall incidence of The Department’s estimates assume Specifically, the Department assumed electronic distribution and the that electronic provision of disclosures that plans covering 90 percent of corresponding savings will be larger eliminates the distribution cost participants with access to electronic than the Department estimates. otherwise associated with the provision media at work would distribute The Department assumed that three- of printed disclosures. This assumption disclosures electronically at work, and fourths of participants with access to reflects the Department’s expectation that plans covering two-thirds of electronic media only at home, and who that (1) plan sponsors will provide participants with access only at home are offered the opportunity to consent to disclosures via electronic media and would offer the opportunity for receive disclosures outside the infrastructure that exist for purposes receiving disclosures electronically workplace, would actually consent. It other than the provision of ERISA outside the work place, and so seek seems reasonable to assume that a disclosures and (2) that the cost to consent. substantial majority would so consent, electronically transmit disclosures is The Department assumed that plans given the Department’s forgoing therefore negligible. would distribute electronically only assumption that only disclosures that do those disclosures that are directed at not contain sensitive, individual- Having adopted these assumptions, participants, and not those directed at specific information would be the Department estimated the amount of beneficiaries or former participants or distributed electronically. gross savings as a function of the degree beneficiaries. It seems likely that plans Finally, the Department assumed that to which disclosures will be provided might view their electronic links to the marginal cost of distributing a electronically under the final regulation. participants and active employees as disclosure to an individual is equal to This in turn is a function of participant more reliable than those to beneficiaries the average cost of distributing it to all access to electronic media, plan sponsor or former participants or beneficiaries relevant individuals. This assumption adoption of new technologies, the and, because beneficiaries and former seems reasonable given that the large application of those technologies to plan sponsors and service providers particular disclosures, and the degree to 11 ‘‘Home Computers and Internet Use in the who provide most disclosures provide which participants and beneficiaries United States: August 2000,’’ U.S. Census Bureau very large numbers of them. The will consent to receive disclosures Current Population Reports (September, 2001). assumption implies that the cost of electronically at home. The Department 12 Contingent Work Supplement to the February, 1999 Current Populations Survey, U.S. Census distributing a particular disclosure is a considered each of these in turn. Bureau. linear function of the number of VerDate 11 individuals receiving it, so the cost of materials and procedures and obtain consent records and processing any distributing a disclosure will decrease affected participants’ consent to accept changes in consent elections. These proportionately with the share of electronic delivery of disclosures ongoing tasks are likely to be integrated individuals to whom it is distributed outside the workplace. The final into the larger process of hiring and electronically rather than in printed regulation’s safe harbor requires plans enrolling individuals in benefit plans form. that wish to distribute disclosures and will add little cost at the margin. In combination, these assumptions electronically outside the work place to Ongoing savings are expected to amount suggest that the printing, materials and obtain affirmative consent from the to at least $74 million per year, mailing costs associated with relevant affected participants and beneficiaries. increasing in the future with increased ERISA disclosures will be reduced by To accomplish this, plans or their utilization of electronic disclosure approximately 14 percent in the first service providers generally must methods. year in connection with this final develop a process for requesting and The electronic provision of ERISA regulation (or 27 percent in connection recording such consent, and then disclosures and the corresponding with the proposed and final regulations implement the process and thereby amount of savings is likely to grow in together). This amounts to $66 million obtain or fail to obtain consent from in net savings from the final regulation the future, as participants’ access to and affected participants and beneficiaries. (or $131 million from the proposed and comfort with electronic media both at final regulations together). The Department estimates the cost to work and at home increases, as plans’ As noted above, the Department’s develop and implement consent use of such media expands, and as some estimate of $66 million in savings in the processes at $8 million. The cost to sponsors apply new technologies more first year is a net figure. It includes a develop the processes and most of the broadly to disclosures to beneficiaries or total of $74 million in gross annual cost to implement them are one-time former participants or to disclosures savings from the elimination of costs incurred in the first year. Ongoing that include information specific to materials, printing, and mailing costs. costs in later years include only the cost individuals. This gross saving is partly offset in the of obtaining consent from new or The Department’s estimates of the first year by an $8 million cost incurred prospective participants and savings from the final and proposed to develop appropriate consent beneficiaries and the cost of maintaining regulations are summarized below. ESTIMATED FINANCIAL SAVINGS ATTRIBUTABLE TO THE FINAL REGULATIONS [$Millions in First Year] Selected disclosures At work Other location Total SPD/SMM ...... 13 33.5 34.2 67.7 SAR ...... 13 31.7 32.4 64.1 404 (c) Disclosure ...... 3.2 3.1 6.3 Notice of Pre-Existing Condition Exclusions ...... 0.2 0.2 0.5 Special Enrollment ...... 0.2 0.2 0.4 Total Gross Savings ...... 68.8 70.2 139.0 Less SPD/SMM and SAR Savings Attributable to the Proposed Regulation 13 ...... ¥65.2 Consent Cost ...... ¥7.7 ¥7.7 Total Net Savings ...... 3.6 62.5 66.0 13 These savings are attributable to the proposed regulation and therefore are not included in total savings from the final regulation. The $33.5 million and $31.7 million estimated SPD/SMM and SAR savings differ from those presented in the preamble to the proposed regulation (64 FR 4511). The Department grounded its current estimates in data from recent Census Bureau survey of computer use. These data were not avail- able when the Department published the proposed regulation. Executive Order 12866 inconsistency or otherwise interfering Paperwork Reduction Act with an action taken or planned by Under Executive Order 12866 (58 FR another agency; (3) materially altering The Department of Labor, as part of its 51735), the Department must determine the budgetary impacts of entitlement continuing effort to reduce paperwork whether a regulatory action is and respondent burden, conducts a ‘‘significant’’ and therefore subject to grants, user fees, or loan programs or the rights and obligations of recipients preclearance consultation program to review by the Office of Management and provide the general public and Federal Budget (OMB). Section 3(f) of the thereof; or (4) raising novel legal or policy issues arising out of legal agencies with an opportunity to Executive Order defines a ‘‘significant comment on proposed and continuing regulatory action’’ as an action that is mandates, the President’s priorities, or collections of information in accordance likely to result in a rule (1) having an the principles set forth in the Executive with the Paperwork Reduction Act of annual effect on the economy of $100 Order. It has been determined that these 1995 (PRA 95) (44 U.S.C. 3506(c)(2)(A)). million or more, or adversely and rules are significant within the meaning materially affecting a sector of the of section 3(f)(4) of the Executive Order, This helps to ensure that requested data economy, productivity, competition, and are thus subject to OMB review. can be provided in the desired format, jobs, the environment, public health or Discussion of the costs and benefits of reporting burden (time and financial safety, or State, local or tribal this final rule appear above in the resources) is minimized, collection governments or communities (also summary of the Economic Impact of instruments are clearly understood, and referred to as ‘‘economically Electronic Technologies Regulation. the impact of collection requirements on significant’’); (2) creating serious respondents can be properly assessed. VerDate 11 Currently, the Pension and Welfare affirmatively consented to receive is spread over an estimate of the number Benefits Administration is soliciting disclosure documents. Prior to of third parties that are expected to comments concerning the information consenting, the participant or assist plan sponsors with developing collection request (ICR) incorporated in beneficiary must also be provided with consent materials that conform to the the final rules relating to use of a clear and conspicuous statement terms of the regulation, in recognition of electronic communication and indicating the types of documents to the economies of scale that can be recordkeeping technologies by which the consent would apply, that achieved through the purchase of employee benefit plans. consent may be withdrawn at any time, administrative services. The number of Desired Focus of Comments: The procedures for withdrawing consent and large, self-administered plans is added Department of Labor has submitted a updating necessary information, the to arrive at an estimate of about 50,000 copy of the proposed information right to obtain a paper copy, and any separate entities that will develop collection to OMB in accordance with hardware and software requirements. In consent materials. 44 U.S.C. 3507(d) of PRA 95 for review the event of a hardware or software About 95% are expected to use of its information collection. The change that creates a material risk that service providers, resulting in cost Department and OMB are particularly the individual will be unable to access burden, while about 5% are expected to interested in comments that: or retain documents that were the develop consent materials using in- • Evaluate whether the proposed subject of the initial consent, the house staff. Resulting hour and cost collection of information is necessary individual must be provided with burden estimates, based on 2 hours at an for the proper performance of the information concerning the revised hourly rate of $72,14 are shown below. functions of the agency, including hardware or software, and an Total costs include minor additions for whether the information will have opportunity to withdraw a prior paper and copying costs. practical utility; consent. • Type of Review: New. Evaluate the accuracy of the The Department is unaware of any Agency: Department of Labor, Pension agency’s estimate of the burden of the data source that would directly identify and Welfare Benefits Administration. proposed collection of information, the number of plans that will decide to Title: Consent to receive employee including the validity of the transmit disclosure documents benefit plan disclosures electronically. methodology and assumptions used; electronically to a non-work location, • OMB Number: 1210–NEW. Enhance the quality, utility, and and thus be subject to the affirmative Affected Public: Individuals or clarity of the information to be consent requirement. The Department households; Business or other for-profit; collected; and has instead made certain assumptions • Not-for-profit institutions. Minimize the burden of the pertaining to the cost to prepare and Respondents: 50,000. collection of information on those who distribute consent for all employee Frequency of Response: One-time. are to respond, including through the benefit plans. Plans are expected to Responses: 50,000. use of appropriate automated, incur what is primarily a one-time start- Estimated Total Burden Hours: 5,042. electronic, mechanical, or other up cost in the development and Total Capital/Start-up Cost: technological collection techniques or preparation of materials used to seek $7,340,000. other forms of information technology, and verify consent from participants Total Annualized Capital/Start-up e.g., permitting electronic submission of and beneficiaries. Cost: $2,447,000. responses. Our estimates are based on the The Department has not accounted PRA Addresses: A copy of the ICR conservative assumption that most separately for the ongoing cost of with applicable supporting statement plans will wish to avail themselves of maintaining consent materials and may be obtained by calling the the opportunity to reduce distribution providing them to new employees. The Department of Labor, Ms. Marlene costs if possible, such that most plan ongoing cost associated with Howze, at (202) 693–4158, or by email sponsors will incur the cost to develop maintenance is considered to be to [email protected]. Comments a consent procedure and documentation minimal for any sponsor once the initial and questions about the ICR should be on behalf of the plan, regardless of the investment in materials and procedures submitted to the Office of Management magnitude of savings that can be is defrayed. Plan sponsors and and Budget, Office of Information and accomplished in satisfying disclosure administrators who make use of Regulatory Affairs, ATTN: Desk Officer obligations through electronic means. electronic means of disclosure are for the Pension and Welfare Benefits The number of separate consent forms expected to distribute consent forms in Administration, Room 10235, 725 17th designed is then reduced based on other the least costly way available, such as Street, NW, Washington, DC, 20503 factors considered relevant. Specifically, including a photocopy in new employee ((202) 395–7316). the total number of plans is reduced to information packages or along with Dates: The Department has requested take account of the fact that a sponsor various other employment forms, that OMB approve or disapprove the is likely to use either the same or nearly resulting in additional burden that is so collection of information by June 10, the same form for each plan they small as to be considered negligible. 2002. Comments should be submitted to sponsor (for example, only one consent Although the discussion presented OMB by May 9, 2002 to ensure their form and procedure is assumed to be here pertains to the consent requirement consideration. designed for use by a sponsor’s health in the final rule, it should also be noted The ICR provisions are included at and pension plan or plans). that the amendment to § 2520.104b–1 § 2520.104b–1(c). Employee benefit plan It is also assumed that the very large and the methodology used to estimate administrators will be deemed to satisfy number of small health plans will either the impact of the amendments offer a their disclosure obligations when not communicate electronically and basis for adjustments to the burden furnishing documents electronically require consent, or will rely on the estimates of a number of other only if a participant who does not have relatively small number of group disclosures under Title I of ERISA. In access to the employer’s electronic insurance issuers they utilize to design information system in the normal course consent forms and procedures. Finally, 14 Based on the Bureau’s of Labor Statistics of his duties, or a beneficiary or other with the exception of large, self- Occupational Employment Survey and Employment person entitled to documents, has administered plans, the number of plans Cost Index. VerDate 11 general, § 2520.104b–1 provides was based on the definition of a small policies that have substantial direct implementing guidance on the manner entity found in regulations issued by the effects on the States, the relationship in which the substantive disclosure Small Business Administration (13 CFR between the national government and requirements of Title I of ERISA will be 121.201) or on the definition considered the States, or on the distribution of deemed to have been met. These final appropriate by PWBA as based on power and responsibilities among the amendments address the circumstances section 104(a)(2) of ERISA, as an various levels of government. This final under which electronic disclosure employee benefit plan with fewer than rule does not have federalism methods will be deemed to have met 100 participants. The Department implications because it has no substantive disclosure obligations, but requested comments on its definition substantial direct effect on the States, on they do not alter the substantive and certification, and received none. It the relationship between the national disclosure requirements of Title I. is the Department’s view that the final government and the States, or on the As a result of using electronic rule, including the modifications from distribution of power and disclosure methods, and of meeting the the proposal, will not significantly responsibilities among the various conditions of this ICR involving impact entities in any size category. The levels of government. Section 514 of appropriate consent, the burden of other final rule does not require any plan or ERISA provides, with certain exceptions information collections may be reduced. other entity to make use of electronic specifically enumerated, that the Information supporting the media for either disclosure or provisions of Titles I and IV of ERISA Department’s estimates of those recordkeeping purposes. As such, supersede any and all laws of the States potential burden reductions for entities may avoid both any marginal as they relate to any employee benefit disclosures such as information cost and any beneficial impacts by plan covered under ERISA. The required to be provided under ERISA simply retaining their existing paper- requirements implemented in this final section 404(c), or Notices of Preexisting based methods of compliance with rule do not alter the fundamental Condition Exclusions under Part 7 will disclosure requirements. Therefore, the reporting and disclosure requirements be submitted to OMB. Because the undersigned certifies that this final rule provisions of the statute with respect to underlying terms of those information will not have a significant impact on a employee benefit plans, and as such collections, which are incorporated in substantial number of small entities. have no implications for the States or existing statutory provisions and the relationship or distribution of power regulatory guidance, are unchanged, Small Business Regulatory Enforcement Fairness Act between the national government and however, it is the view of the the States. Department that the terms of these The rules being issued here are information collections have not been subject to the provisions of the Small Statutory Authority modified. Business Regulatory Enforcement This regulation is issued pursuant to Comments submitted in response to Fairness Act of 1996 (5 U.S.C. 801 et the authority in sections 104(b), 107, this notice will be considered by OMB seq.) and will be transmitted to Congress 209, and 505 of ERISA (Pub. L. 93–406, in its consideration of the request for and the Comptroller General for review. 88 Stat. 894, 29 U.S.C. 1027, 1059, 1134, approval of the ICR; they will also The rule is not a ‘‘major rule’’ as that 1135) and under Secretary of Labor’s become a matter of public record. term is defined in 5 U.S.C. 804, because Order No. 1–87, 52 FR 13139, April 21, Regulatory Flexibility Act it is not likely to result in (1) an annual 1987. effect on the economy of $100 million The Regulatory Flexibility Act (5 or more; (2) a major increase in costs or List of Subjects in 29 CFR Part 2520 U.S.C. 601 et seq.) (RFA), imposes prices for consumers, individual Employee benefit plans, Employee certain requirements with respect to industries, or federal, State, or local Retirement Income Security Act, federal rules that are subject to the government agencies, or geographic Pension plans, Recordkeeping, Welfare notice and comment requirements of regions; or (3) significant adverse effects plans. section 553(b) of the Administrative on competition, employment, For the reasons set forth above, Part Procedure Act (5 U.S.C. 551 et seq.) and investment, productivity, innovation, or that are likely to have a significant 2520 of Title 29 of the Code of Federal on the ability of United States-based Regulations is amended as follows: economic impact on a substantial enterprises to compete with foreign- number of small entities. Unless an based enterprises in domestic and PART 2520—[AMENDED] agency certifies that a rule will not have export markets. a significant economic impact on a 1. The authority for Part 2520 is substantial number of small entities, Unfunded Mandates Reform Act revised to read as follows: section 604 of the RFA requires the For purposes of the Unfunded Authority: Secs. 101, 102, 103, 104, 105, agency to present a final regulatory Mandates Reform Act of 1995 (Pub. L. 107, 109, 110, 111(b)(2), 111(c), 209, and 505, flexibility analysis at the time of the 104–4), as well as Executive Order Pub. L. 93–406, 88 Stat. 840–52, 865, 893 and publication of the notice of final 12875, this rule does not include any 894 (29 U.S.C. 1021–1025, 1027, 1029–31, rulemaking describing the impact of the Federal mandate that may result in 1059, 1134 and 1135); Secretary of Labor’s rule on small entities. Small entities Order No. 27–74, 13–76, 1–87, and Labor expenditures by State, local, or tribal Management Services Administration Order include small businesses, organizations, governments, and does not impose an 2–6. Sections 2520.102–3, 2520.104b–1 and and governmental jurisdictions. annual burden exceeding $100 million 2520.104b–3 also are issued under sec. At the time of publication of the on the private sector. 101(a), (c) and (g)(4) of Pub. L. 104–191, 110 notice of proposed rulemaking, the Stat. 1936, 1939, 1951 and 1955 and, sec. 603 Pension and Welfare Benefits Federalism Statement of Pub. L. 104–204, 110 Stat. 2935 (29 U.S.C. Administration (PWBA) certified that Executive Order 13132 (August 4, 1185 and 1191c). Sections 2520.104b–1 and the proposed rule, if promulgated in 1999) outlines fundamental principles 2520.107 are also issued under the authority final form without material change, of federalism and requires the of sec. 1510 of Pub. L. 105–37, 111 Stat. 1114. would not have a significant impact on adherence to specific criteria by federal 2. Amend section 2520.104b–1 to a substantial number of small entities agencies in the process of their revise the first sentence of paragraph (a), regardless of whether that determination formulation and implementation of the first sentence of paragraph (b)(1), VerDate 11 and paragraph (c), and to add a new reasonably evident as transmitted (e.g., the paper version will be provided free paragraph (e) to read as follows: the attached document describes of charge; and changes in the benefits provided by (5) Any hardware and software § 2520.104b–1 Disclosure. your plan) and of the right to request requirements for accessing and retaining (a) General disclosure requirements. and obtain a paper version of such the documents; and The administrator of an employee document; and (D) Following consent, if a change in benefit plan covered by Title I of the Act (iv) Upon request, the participant, hardware or software requirements must disclose certain material, beneficiary or other individual is needed to access or retain electronic including reports, statements, notices, furnished a paper version of the documents creates a material risk that and other documents, to participants, electronically furnished documents. the individual will be unable to access beneficiaries and other specified (2) Paragraph (c)(1) shall only apply or retain electronically furnished individuals. Disclosure under Title I of with respect to the following documents: the Act generally takes three forms. individuals: (1) Is provided with a statement of the *** (i) A participant who— revised hardware or software (b) Fulfilling the disclosure obligation. requirements for access to and retention (1) Except as provided in paragraph (e) (A) Has the ability to effectively of electronically furnished documents; of this section, where certain material, access documents furnished in (2) Is given the right to withdraw including reports, statements, notices electronic form at any location where consent without charge and without the and other documents, is required under the participant is reasonably expected to imposition of any condition or Title I of the Act, or regulations issued perform his or her duties as an consequence that was not disclosed at thereunder, to be furnished either by employee; and the time of the initial consent; and direct operation of law or on individual (B) With respect to whom access to (3) Again consents, in accordance request, the plan administrator shall use the employer’s or plan sponsor’s with the requirements of paragraph measures reasonably calculated to electronic information system is an (c)(2)(ii)(A) or paragraph (c)(2)(ii)(B) of ensure actual receipt of the material by integral part of those duties; or this section, as applicable, to the receipt plan participants, beneficiaries and (ii) A participant, beneficiary or any of documents through electronic media. other specified individuals. * * * other person entitled to documents under Title I of the Act or regulations * * * * * * * * * * issued thereunder (including, but not (c) Disclosure through electronic (e) Limitations. This section does not limited to, an ‘‘alternate payee’’ within media. (1) Except as otherwise provided apply to disclosures required under the meaning of section 206(d)(3) of the by applicable law, rule or regulation, the provisions of part 2 and part 3 of the Act Act and a ‘‘qualified beneficiary’’ within administrator of an employee benefit over which the Secretary of the Treasury the meaning of section 607(3) of the Act) plan furnishing documents through has interpretative and regulatory who— electronic media is deemed to satisfy authority pursuant to Reorganization (A) Except as provided in paragraph the requirements of paragraph (b)(1) of Plan No. 4 of 1978. (c)(2)(ii) (B) of this section, has this section with respect to an 3. Add subpart G to part 2520 to read affirmatively consented, in electronic or individual described in paragraph (c)(2) as follows: non-electronic form, to receiving if: Subpart G—Recordkeeping (i) The administrator takes documents through electronic media Requirements appropriate and necessary measures and has not withdrawn such consent; (B) In the case of documents to be reasonably calculated to ensure that the Sec. system for furnishing documents— furnished through the Internet or other 2520.107–1 Use of electronic media for (A) Results in actual receipt of electronic communication network, has maintenance and retention of records. transmitted information (e.g., using affirmatively consented or confirmed return-receipt or notice of undelivered consent electronically, in a manner that § 2520.107–1 Use of electronic media for maintenance and retention of records. electronic mail features, conducting reasonably demonstrates the periodic reviews or surveys to confirm individual’s ability to access (a) Scope and purpose. Sections 107 receipt of the transmitted information); information in the electronic form that and 209 of the Employee Retirement and will be used to provide the information Income Security Act of 1974, as (B) Protects the confidentiality of that is the subject of the consent, and amended (ERISA), contain certain personal information relating to the has provided an address for the receipt requirements relating to the individual’s accounts and benefits (e.g., of electronically furnished documents; maintenance of records for reporting incorporating into the system measures (C) Prior to consenting, is provided, in and disclosure purposes and for designed to preclude unauthorized electronic or non-electronic form, a determining the pension benefits to receipt of or access to such information clear and conspicuous statement which participants and beneficiaries are by individuals other than the individual indicating: or may become entitled. This section for whom the information is intended); (1) The types of documents to which provides standards applicable to both (ii) The electronically delivered the consent would apply; pension and welfare plans concerning documents are prepared and furnished (2) That consent can be withdrawn at the use of electronic media for the in a manner that is consistent with the any time without charge; maintenance and retention of records style, format and content requirements (3) The procedures for withdrawing required to be kept under sections 107 applicable to the particular document; consent and for updating the and 209 of ERISA. (iii) Notice is provided to each participant’s, beneficiary’s or other (b) General requirements. The record participant, beneficiary or other individual’s address for receipt of maintenance and retention requirements individual, in electronic or non- electronically furnished documents or of sections 107 and 209 of ERISA are electronic form, at the time a document other information; satisfied when using electronic media if: is furnished electronically, that apprises (4) The right to request and obtain a (1) The electronic recordkeeping the individual of the significance of the paper version of an electronically system has reasonable controls to ensure document when it is not otherwise furnished document, including whether the integrity, accuracy, authenticity and VerDate 11 reliability of the records kept in (5) Adequate records management quickly to the exclusion of all other electronic form; practices are established and letters or numerals. The term (2) The electronic records are implemented (for example, following ‘‘readability’’ means that the observer maintained in reasonable order and in a procedures for labeling of electronically must be able to recognize a group of safe and accessible place, and in such maintained or retained records, letters or numerals as words or complete manner as they may be readily providing a secure storage environment, numbers. inspected or examined (for example, the creating back-up electronic copies and (d) Disposal of original paper records. recordkeeping system should be capable selecting an off-site storage location, Original paper records may be disposed of indexing, retaining, preserving, observing a quality assurance program of any time after they are transferred to retrieving and reproducing the evidenced by regular evaluations of the an electronic recordkeeping system that electronic records); electronic recordkeeping system complies with the requirements of this including periodic checks of section, except such original records (3) The electronic records are readily electronically maintained or retained convertible into legible and readable may not be discarded if the electronic records, and retaining paper copies of record would not constitute a duplicate paper copy as may be needed to satisfy records that cannot be clearly, or substitute record under the terms of reporting and disclosure requirements accurately or completely transferred to the plan and applicable federal or state or any other obligation under Title I of an electronic recordkeeping system). ERISA; (c) Legibility and readability. All law. (4) The electronic recordkeeping electronic records must exhibit a high Signed at Washington, D.C., this 3rd day of system is not subject, in whole or in degree of legibility and readability when April, 2002. part, to any agreement or restriction that displayed on a video display terminal or Ann L. Combs, would, directly or indirectly, other method of electronic transmission Assistant Secretary, Pension and Welfare compromise or limit a person’s ability to and when reproduced in paper form. Benefits, Administration, Department of comply with any reporting and The term ‘‘legibility’’ means the Labor. disclosure requirement or any other observer must be able to identify all [FR Doc. 02–8499 Filed 4–8–02; 8:45 am] obligation under Title I of ERISA; and letters and numerals positively and BILLING CODE 4510–29–P VerDate 11 Part VI Department of Defense General Services Administration National Aeronautics and Space Administration 48 CFR Parts 27 and 52 Federal Acquisition Regulation; Trademarks for Government Products; Proposed Rule VerDate 11 DEPARTMENT OF DEFENSE Acquisition Regulation (FAR) rule published after the initial meeting on 1998–018, Trademarks for Government the Defense Procurement internet home GENERAL SERVICES Products, that was published in the page at http://www.acq.osd.mil/dp/. ADMINISTRATION Federal Register at 66 FR 42101 on DATES: The first meeting will be held on August 9, 2001. Five written comments May 9, 2002, from 8 a.m. to 5 p.m. with NATIONAL AERONAUTICS AND were submitted in response to the an hour break for lunch at 12 p.m. SPACE ADMINISTRATION Federal Register notice; in addition, ADDRESSES: The public meeting will be articles have been published discussing 48 CFR Parts 27 and 52 held in room C–43, Crystal Mall the proposed rule. After reviewing the Building 4, 1941 Jefferson Davis [FAR Case 1998–018 (Public Meeting)] public comments, the cosponsors would Highway, Arlington, VA 22202. like to explore further the views of Federal Acquisition Regulation; interested parties regarding the key FOR FURTHER INFORMATION CONTACT: Trademarks for Government Products issues raised in the proposed rule. William H. Anderson, Chair, Defense Copies of the five written comments, Acquisition Regulations Council AGENCIES: Department of Defense (DoD), and a list of possible issues for Committee on Patents, Data, and General Services Administration (GSA), discussion at the public meeting, are Copyrights, by telephone at (703) 588– and National Aeronautics and Space available on the Defense Procurement 5090, by fax at (703) 588–8037, or by e- Administration (NASA). internet home page at http:// mail at ACTION: Notice of public meeting. www.acq.osd.mil/dp/. [email protected]. SUMMARY: The Director of Defense If necessary to ensure that all of the Dated: April 3, 2002. Procurement and the General Services views of the interested parties have been Jeremy Olson, Administration Deputy Associate heard, subsequent public meetings may Acting Deputy Director, Acquisition Policy Administrator for Acquisition Policy are be held concerning issues raised by the Division. cosponsoring a public meeting to proposed rule. The dates and times of [FR Doc. 02–8452 Filed 4–8–02; 8:45 am] discuss the proposed Federal any subsequent meetings will be BILLING CODE 6820–EP–P VerDate 11 Reader Aids Federal Register Vol. 67, No. 68 Tuesday, April 9, 2002 CUSTOMER SERVICE AND INFORMATION CFR PARTS AFFECTED DURING APRIL 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 Laws 523–5227 the revision date of each title. 5 CFR 710...... 16061 Presidential Documents 824...... 15339 Executive orders and proclamations 523–5227 410...... 15463 The United States Government Manual 523–5227 550...... 15463 12 CFR 551...... 15463 3...... 16971 Other Services 630...... 15463 208...... 16971 Electronic and on-line services (voice) 523–3447 7 CFR 225...... 16971 Privacy Act Compilation 523–3187 226...... 16980 400...... 16285 Public Laws Update Service (numbers, dates, etc.) 523–6641 264a...... 15335 401...... 16285 TTY for the deaf-and-hard-of-hearing 523–5229 325...... 16971 403...... 16285 567...... 16971 405...... 16285 609...... 16627 406...... 16285 ELECTRONIC RESEARCH 620...... 16627 409...... 16285 World Wide Web 414...... 16285 Proposed Rules: 563b...... 17230 Full text of the daily Federal Register, CFR and other publications 415...... 16285 574...... 17230 is located at: http://www.access.gpo.gov/nara 416...... 16285 422...... 16285 575...... 17230 Federal Register information and research tools, including Public 425...... 16285 Inspection List, indexes, and links to GPO Access are located at: 13 CFR 430...... 16285 http://www.nara.gov/fedreg 433...... 16285 Proposed Rules: E-mail 435...... 16285 121...... 16063, 17020 437...... 16285 14 CFR FEDREGTOC-L (Federal Register Table of Contents LISTSERV) is 441...... 16285 an open e-mail service that provides subscribers with a digital 443...... 16285 39 ...... 15468, 15470, 15472, form of the Federal Register Table of Contents. The digital form 445...... 16285 15473, 15475, 15476, 15714, of the Federal Register Table of Contents includes HTML and 446...... 16285 15717, 16011, 16983, 16987, PDF links to the full text of each document. 447...... 16285 16991, 16994 To join or leave, go to http://listserv.access.gpo.gov and select 450...... 16285 71...... 15478, 15479 Online mailing list archives, FEDREGTOC-L, Join or leave the list 451...... 16285 97...... 16013, 16014 (or change settings); then follow the instructions. 454...... 16285 Ch. VI...... 17258 455...... 16285 1300...... 17258 PENS (Public Law Electronic Notification Service) is an e-mail 456...... 16285 1310...... 17258 service that notifies subscribers of recently enacted laws. 458...... 16285 Proposed Rules: To subscribe, go to http://hydra.gsa.gov/archives/publaws-l.html 916...... 16286 25...... 16329, 16656 and select Join or leave the list (or change settings); then follow 917...... 16286 39 ...... 15755, 15758, 15760, the instructions. 989...... 15707 15762, 15763, 16064, 16067, 1703...... 16011 16069, 16330, 16331, 16333, FEDREGTOC-L and PENS are mailing lists only. We cannot 1714...... 16969 16335 respond to specific inquiries. 3565...... 16969 71 ...... 15502, 15503, 15504 Proposed Rules: Reference questions. Send questions and comments about the 16 CFR Federal Register system to: [email protected] 905...... 15339 927...... 15747 Proposed Rules: The Federal Register staff cannot interpret specific documents or 310...... 15767 regulations. 1205...... 15495 1219...... 17018 18 CFR 1710...... 17018 FEDERAL REGISTER PAGES AND DATE, APRIL Proposed Rules: 8 CFR Ch. 1 ...... 16071 15333–15462...... 1 286...... 15333 19 CFR 15463–15706...... 2 Proposed Rules: 15707–16010...... 3 286...... 15753 181...... 15480 16011–16284...... 4 191...... 16634 9 CFR 16285–16626...... 5 Proposed Rules: 16627–16968...... 8 94...... 15334 141...... 16664 16969–17278...... 9 113...... 15711 142...... 16664 Proposed Rules: Ch. III ...... 15501 21 CFR 113...... 16327 173...... 15719 201...... 16304 10 CFR 330...... 16304 20...... 16298 331...... 16304 Proposed Rules: 341...... 16304 50...... 16654 346...... 16304 VerDate 11-MAY-2000 22:33 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00001 Fmt 4712 Sfmt 4712 E:\FR\FM\09APCU.LOC pfrm04 PsN: 09APCU ii Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Reader Aids 355...... 16304 1191...... 15509 1603...... 16670 216...... 15351 358...... 16304 369...... 16304 38 CFR 44 CFR 49 CFR 701...... 16304 Ch. 1 ...... 16023 64...... 16030 Proposed Rules: 20...... 16309 171...... 15736 212...... 15344 47 CFR 172...... 15736 872...... 16338 39 CFR 1...... 16647, 17009 173...... 15736 174...... 15736 28 CFR 224...... 16023 2...... 17009 229...... 16023 26...... 17009 176...... 15736 89...... 17027 230...... 16024 36...... 17013 178...... 15736 180...... 15736 29 CFR 233...... 16023 52...... 16322 266...... 16023 54...... 15490, 17014 229...... 16032 1979...... 15454 273...... 16023 61...... 17009 533...... 16052 4022...... 16950 69...... 15490, 17009 659...... 15725 4022B ...... 16950 40 CFR 73 ...... 15493, 15735, 15736, Proposed Rules: 4044...... 16950 16651, 16652, 17014 171...... 15510 2520...... 17264 52 ...... 15335, 15336, 16026, 16638, 16640, 16642, 16644, 74...... 16652 172...... 15510 Proposed Rules: 17007 76...... 17015 173...... 15510 552...... 16668 63 ...... 15486, 16317, 16582, 90...... 16652 175...... 15510 30 CFR 16614 Proposed Rules: 191...... 16355 1...... 17036 Proposed Rules: 81...... 16646 192...... 16355 936...... 16341 148...... 16262 2...... 16683, 17038 195...... 16355 180...... 15727, 16027 25...... 16347 567...... 15769 31 CFR 261...... 16262 52...... 16347 571...... 15769 Ch. V...... 16308 268...... 16262, 17119 61...... 17036 574...... 15769 271...... 16262 69...... 17036 575...... 15769 32 CFR 302...... 16262 73 ...... 15768, 15769, 16350, 745...... 15489 16351, 16673, 16706, 17041 199...... 15721 50 CFR 935...... 16997 Proposed Rules: 74...... 16683 9...... 17122 80...... 16683 17...... 15337 33 CFR 122...... 17122 90...... 16351, 16683 229...... 15493 117...... 16016 123...... 17122 97...... 16683 600...... 15338 165 ...... 15484, 15744, 16016 124...... 17122 660 ...... 15338, 16322, 16323 48 CFR Proposed Rules: 125...... 17122 679...... 16325 147...... 15505 52...... 15345, 16669 1823...... 17016 Proposed Rules: 165...... 15507, 16668 63 ...... 15510, 15674, 16154, 1836...... 17016 17...... 15856, 16492 16343, 16625 1852...... 17016 92...... 16707 36 CFR 70...... 15767 Proposed Rules: 600...... 15516 703...... 16018 180...... 16073 27...... 17278 622...... 16359 Proposed Rules: 228...... 15348 52...... 17278 648...... 16079, 16362 1190...... 15509 721...... 16345 208...... 15351 679...... 15517 VerDate 11-MAY-2000 22:33 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00002 Fmt 4712 Sfmt 4712 E:\FR\FM\09APCU.LOC pfrm04 PsN: 09APCU Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Reader Aids iii REMINDERS Aviation disaster relief; air Sea turtle conservation— State operating permits The items in this list were carrier guarantee loan Fishing activities programs— editorially compiled as an aid program; technical restrictions; comments Connecticut; comments to Federal Register users. amendment; published 4- due by 4-15-02; due by 4-15-02; Inclusion or exclusion from 9-02 published 3-29-02 [FR published 3-15-02 [FR this list has no legal 02-07708] 02-06273] significance. COMMENTS DUE NEXT Fishery conservation and Air quality implementation WEEK management: plans; approval and Magnuson-Stevens Act promulgation; various RULES GOING INTO provisions States: EFFECT APRIL 9, 2002 AGRICULTURE DEPARTMENT Domestic fisheries; California; comments due by exempted fishing permit 4-15-02; published 3-15- Agricultural Marketing AGRICULTURE applications; comments 02 [FR 02-06271] Service DEPARTMENT due by 4-17-02; Texas; comments due by 4- Avocados grown in— Rural Utilities Service published 4-2-02 [FR 19-02; published 3-20-02 Electric loans: Florida; comments due by 02-07931] [FR 02-06721] 4-15-02; published 3-15- Northeastern United States Hazardous waste program Insured loans— 02 [FR 02-06139] fisheries— authorizations: Pre-loan policies and Milk marketing orders: procedures; schedule of Monkfish; comments due Michigan; comments due by interest rates for Upper Midwest; comments by 4-19-02; published 4-15-02; published 2-28- municipal rate loans; due by 4-15-02; published 4-4-02 [FR 02-08076] 02 [FR 02-04788] 2-14-02 [FR 02-03634] published 4-9-02 CONSUMER PRODUCT Hazardous waste: Prunes (dried) produced in— SAFETY COMMISSION AIR TRANSPORTATION Resource Conservation and STABILIZATION BOARD California; comments due by Federal Hazardous Recovery Act Burden Substances Act: Air Transportation Safety and 4-15-02; published 3-15- Reduction Initiative; System Stabilization Act: 02 [FR 02-06144] Certain model rocket comments due by 4-17- propellant devices; use Aviation disaster relief; air AGRICULTURE 02; published 1-17-02 [FR with lightweight surface carrier guarantee loan DEPARTMENT 02-00191] vehicles; comments due program; Board Animal and Plant Health Radiation protection programs: by 4-15-02; published 1- administrative regulations; Inspection Service 30-02 [FR 02-02059] Idaho National Engineering published 4-9-02 Fruits and vegetables, and Environmental DEFENSE DEPARTMENT ENVIRONMENTAL imported; irradiation Laboratory— PROTECTION AGENCY phytosanitary treatment; Federal Acquisition Regulation Transuranic radioactive (FAR): Air quality implementation comments due by 4-15-02; waste for disposal at plans; approval and published 3-15-02 [FR 02- Electronic listing of vehicles Waste Isolation Pilot promulgation; various 06267] available for use by more Plant; waste States: AGRICULTURE than one agency; characterization program comments due by 4-16- New Mexico; published 2-8- DEPARTMENT documents availability; 02; published 2-15-02 [FR 02 comments due by 4-19- Animal and Plant Health 02-03786] Inspection Service 02; published 3-20-02 FEDERAL ENVIRONMENTAL [FR 02-06844] Plant-related quarantine, COMMUNICATIONS PROTECTION AGENCY COMMISSION domestic: Toxic substances: Acquisition regulations: Television broadcasting: California and Oregon; Significant new uses— Administrative changes and Digital television— phytophthora ramorum; Neodecaneperoxoic acid, technical amendments; etc.; comments due by Digital television broadcast public hearings; comments comments due by 4-15- 4-19-02; published 3-20- signals; carriage of due by 4-15-02; published 2-14-02 [FR 02-03721] 02; published 3-14-02 [FR 02 [FR 02-06724] transmissions by cable 02-05743] operators; correction; AGRICULTURE FEDERAL ENVIRONMENTAL published 4-9-02 DEPARTMENT COMMUNICATIONS PROTECTION AGENCY Commodity Credit COMMISSION FEDERAL RESERVE Air pollution control: SYSTEM Corporation Common carrier services: Interstate ozone transport International call-back Truth in lending (Regulation Loan and purchase programs: reduction— Z): Noninsured Crop Disaster service, uncompleted call Nitrogen oxides; Section signaling configuration; Official staff commentary; Assistance Program; 126 petitions regarding other nations’ prohibitions amendments; published 4- comments due by 4-18- sources; and Title V enforcement; comments 9-02 02; published 3-19-02 [FR operating permit 02-06212] due by 4-15-02; published NATIONAL AERONAUTICS programs, applicable 3-8-02 [FR 02-05381] AGRICULTURE requirement definition; AND SPACE Satellite services— ADMINISTRATION DEPARTMENT comments due by 4-15- Satellite earth stations use Federal Acquisition Regulation Food Safety and Inspection 02; published 2-22-02 on board vessels in (FAR): Service [FR 02-03918] Nitrogen oxides; State bands shared with Safety and health solicitation Pizza identity standards; terrestrial fixed service; provisions and contract elimination; comments due implementation plan call, technical procedures; comments clauses; published 4-9-02 by 4-15-02; published 3-14- due by 4-19-02; 02 [FR 02-06125] amendments, and OFFICE OF MANAGEMENT Section 126 rules; published 3-22-02 [FR AND BUDGET COMMERCE DEPARTMENT response to court 02-06917] Management and Budget National Oceanic and decisions; comments Radio and television Office Atmospheric Administration due by 4-15-02; broadcasting: Air Transportation Safety and Endangered and threatened published 2-22-02 [FR Broadcast and cable EE0 System Stabilization Act: species: 02-03917] rules and policies; VerDate 11-MAY-2000 22:33 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00003 Fmt 4712 Sfmt 4711 E:\FR\FM\09APCU.LOC pfrm04 PsN: 09APCU iv Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Reader Aids revision; comments due comments due by 4-15- Plain unmounted bearings Pratt & Whitney; comments by 4-15-02; published 3-8- 02; published 2-14-02 [FR and mounted bearings; due by 4-15-02; published 02 [FR 02-05380] 02-03248] comments due by 4-15- 2-14-02 [FR 02-03669] Noncommercial educational INTERIOR DEPARTMENT 02; published 4-4-02 TRANSPORTATION broadcast stations Fish and Wildlife Service [FR 02-07958] DEPARTMENT applicants; comparative Endangered and threatened Travel agencies; comments Federal Aviation standards reexamination; species: due by 4-15-02; published Administration comments due by 4-15- 3-15-02 [FR 02-06195] Critical habitat Airworthiness directives: 02; published 3-5-02 [FR designations— SMALL BUSINESS Rolls-Royce plc; comments 02-05165] Roswell springsnail, etc.; ADMINISTRATION due by 4-15-02; published FEDERAL TRADE comments due by 4-15- Small business standards and 2-14-02 [FR 02-03162] COMMISSION 02; published 2-12-02 disaster loan program: TRANSPORTATION Telemarketing sales rule; [FR 02-03140] Travel agencies; economic DEPARTMENT comments due by 4-15-02; NATIONAL AERONAUTICS injury disaster loan Federal Aviation published 4-3-02 [FR 02- program; comments due Administration 08016] AND SPACE ADMINISTRATION by 4-15-02; published 3- Airworthiness standards: Textile Fiber Products 15-02 [FR 02-06194] Special conditions— Identification Act: Federal Acquisition Regulation (FAR): TRANSPORTATION Airbus Industrie Model Elasterell-p; new generic Electronic listing of vehicles DEPARTMENT A340-500/-600 fiber name and definition; Coast Guard airplanes; comments comments due by 4-19- available for use by more than one agency; Drawbridge operations: due by 4-19-02; 02; published 2-15-02 [FR published 3-20-02 [FR comments due by 4-16- Missouri; comments due by 02-03195] 02-05876] 02; published 2-15-02 [FR 4-16-02; published 2-15- GENERAL SERVICES 02-03786] 02 [FR 02-03693] Dassault Aviation Fan Jet ADMINISTRATION Falcon Series C, D, E, NUCLEAR REGULATORY Federal Acquisition Regulation Ports and waterways safety: and F, and Mystere- COMMISSION (FAR): New London, CT; safety Falcon 20-C5, 20-D5, Rulemaking petitions: Electronic listing of vehicles zone; comments due by 20-E5, and 20-F5 available for use by more Leyse, Robert H.; comments 4-19-02; published 3-20- airplanes; comments than one agency; due by 4-15-02; published 02 [FR 02-06765] due by 4-17-02; comments due by 4-16- 1-29-02 [FR 02-02075] Oahu, Maui, Hawaii, and published 3-18-02 [FR 02; published 2-15-02 [FR NUCLEAR REGULATORY Kauai, HI; anchorages 02-06365] 02-03786] COMMISSION and security zones; Liberty Aerospace Model comments due by 4-15- HEALTH AND HUMAN Spent nuclear fuel and high- XL-2 airplane; 02; published 3-20-02 [FR SERVICES DEPARTMENT level radioactive waste; comments due by 4-15- 02-06733] 02; published 3-14-02 Food and Drug independent storage; Ohio River, Shippingport, [FR 02-06131] Administration licensing requirements: Approved spent fuel storage PA; security zone; TRANSPORTATION Animal drugs, feeds, and comments due by 4-17- related products: casks; list; comments due DEPARTMENT by 4-15-02; published 3- 02; published 3-18-02 [FR No residue; definition Federal Highway 15-02 [FR 02-06228] 02-06364] revision; comments due Administration Pilgrim Nuclear Power Plant, by 4-17-02; published 1- NUCLEAR REGULATORY Engineering and traffic Plymouth, MA; safety and 17-02 [FR 02-01170] COMMISSION operations: security zone; comments Uniform Traffic Control HEALTH AND HUMAN Spent nuclear fuel and high- due by 4-15-02; published Devices Manual— SERVICES DEPARTMENT level radioactive waste; 1-29-02 [FR 02-02209] Accessible pedestrian Food and Drug independent storage; TRANSPORTATION signals; comments due Administration licensing requirements: DEPARTMENT by 4-16-02; published Human drugs: Approved spent fuel storage casks; list; comments due Federal Aviation 2-15-02 [FR 02-03619] Prescription drug marketing; by 4-15-02; published 3- Administration TRANSPORTATION effective date delay; 15-02 [FR 02-06227] Airworthiness directives: DEPARTMENT comments due by 4-15- Federal Motor Carrier Safety 02; published 2-13-02 [FR PERSONNEL MANAGEMENT Bombardier; comments due Administration 02-03282] OFFICE by 4-19-02; published 3- 20-02 [FR 02-06630] Motor carrier safety standards: HEALTH AND HUMAN Employment: Eurocopter France; Mexican motor carriers— SERVICES DEPARTMENT Recruitment and selection through competitive comments due by 4-15- Application form to Food and Drug 02; published 2-14-02 [FR operate beyond U.S. Administration examination; comments due by 4-16-02; published 02-03580] municipalities and Medical devices: 2-15-02 [FR 02-03621] TRANSPORTATION commercial zones on Cutaneous carbon dioxide DEPARTMENT U.S.-Mexico border; and cutaneous oxygen PERSONNEL MANAGEMENT comments due by 4-18- Federal Aviation monitors; reclassification OFFICE 02; published 3-19-02 Administration into class II special Pay administration: [FR 02-05891] Airworthiness directives: controls; comments due Administratively Safety monitoring system by 4-15-02; published 2- uncontrollable overtime Eurocopter France; and compliance initiative 12-02 [FR 02-03281] pay; comments due by 4- comments due by 4-19- for carriers operating in HEALTH AND HUMAN 15-02; published 2-13-02 02; published 3-20-02 [FR U.S.; comments due by SERVICES DEPARTMENT [FR 02-03410] 02-06627] 4-18-02; published 3-19- Tribal Self-Governance SMALL BUSINESS TRANSPORTATION 02 [FR 02-05892] Amendments of 2000; ADMINISTRATION DEPARTMENT TREASURY DEPARTMENT implementation: Small business size standards: Federal Aviation Internal Revenue Service Indian Health Service; tribal Nonmanufacturer rule; Administration Income taxes and procedure self-governance; waivers— Airworthiness directives: and administration: VerDate 11-MAY-2000 22:33 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00004 Fmt 4712 Sfmt 4711 E:\FR\FM\09APCU.LOC pfrm04 PsN: 09APCU Federal Register / Vol. 67, No. 68 / Tuesday, April 9, 2002 / Reader Aids v Foreign individuals claiming may be used in conjunction H.R. 2739/P.L. 107–158 reduced withholding rates with ‘‘PLUS’’ (Public Laws To amend Public Law 107-10 under income tax treaty Update Service) on 202–523– to authorize a United States Public Laws Electronic and receiving unexpected 6641. This list is also plan to endorse and obtain Notification Service payment; taxpayer available online at http:// observer status for Taiwan at (PENS) identification number www.nara.gov/fedreg/ the annual summit of the requirements plawcurr.html. World Health Assembly in Cross-reference; The text of laws is not May 2002 in Geneva, comments due by 4-17- published in the Federal Switzerland, and for other PENS is a free electronic mail 02; published 1-17-02 Register but may be ordered purposes. (Apr. 4, 2002; 116 notification service of newly [FR 02-01126] in ‘‘slip law’’ (individual Stat. 121) enacted public laws. To subscribe, go to http:// Income taxes: pamphlet) form from the H.R. 3985/P.L. 107–159 hydra.gsa.gov/archives/ Catch-up contributions for Superintendent of Documents, To amend the Act entitled ‘‘An U.S. Government Printing publaws-l.html or send E-mail individuals age 50 or over Act to authorize the leasing of to [email protected] Office, Washington, DC 20402 restricted Indian lands for Hearing date change and (phone, 202–512–1808). The with the following text extension of comment public, religious, educational, message: text will also be made recreational, residential, period; comments due available on the Internet from business, and other purposes SUBSCRIBE PUBLAWS-L by 4-15-02; published GPO Access at http:// 2-20-02 [FR 02-04093] requiring the grant of long- Your Name. www.access.gpo.gov/nara/ term leases’’, approved August nara005.html. Some laws may 9, 1955, to provide for binding not yet be available. Note: This service is strictly LIST OF PUBLIC LAWS arbitration clauses in leases for E-mail notification of new H.R. 1499/P.L. 107–157 and contracts related to laws. The text of laws is not This is a continuing list of District of Columbia College reservation lands of the Gila available through this service. public bills from the current Access Improvement Act of River Indian Community. (Apr. PENS cannot respond to session of Congress which 2002 (Apr. 4, 2002; 116 Stat. 4, 2002; 116 Stat. 122) specific inquiries sent to this have become Federal laws. It 118) Last List April 3, 2002 address. VerDate 11-MAY-2000 22:33 Apr 08, 2002 Jkt 197001 PO 00000 Frm 00005 Fmt 4712 Sfmt 4711 E:\FR\FM\09APCU.LOC pfrm04 PsN: 09APCU