6–6–06 Tuesday Vol. 71 No. 108 June 6, 2006

Pages 32415–32800

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Contents Federal Register Vol. 71, No. 108

Tuesday, June 6, 2006

Agricultural Research Service Economic Analysis Bureau NOTICES NOTICES Patent licenses; non-exclusive, exclusive, or partially Agency information collection activities; proposals, exclusive: submissions, and approvals, 32507 Aerotech Laboratories Inc., 32504 Education Department Agriculture Department NOTICES See Agricultural Research Service Agency information collection activities; proposals, See Commodity Credit Corporation submissions, and approvals, 32526–32528 See Cooperative State Research, Education, and Extension Service Election Assistance Commission See Food Safety and Inspection Service NOTICES See Forest Service Meetings; Sunshine Act, 32528 Army Department Employment and Training Administration NOTICES NOTICES Environmental statements; record of decision: Grants and cooperative agreements; availability, etc.: Chemical and Biological Defense Program; soldiers, President’s High Growth Job Training Initiative— sailors, marines and airmen; evolving chemical and Advanced manufacturing industry, 32559–32596 biological threat protection; correction, 32633

Centers for Disease Control and Prevention Employment Standards Administration NOTICES NOTICES Agency information collection activities; proposals, Agency information collection activities; proposals, submissions, and approvals, 32552–32553 submissions, and approvals, 32597–32598 Meetings: Community Preventive Services Task Force, 32553–32554 Energy Department See Federal Energy Regulatory Commission Children and Families Administration NOTICES Environmental Protection Agency Agency information collection activities; proposals, RULES submissions, and approvals, 32554 Air pollution control: Alaska alternative low-sulfur diesel fuel transition Commerce Department program; highway, nonroad, locomotive, and marine See Economic Analysis Bureau diesel fuel requirements, 32450–32464 See Foreign-Trade Zones Board Air quality implementation plans; approval and See International Trade Administration promulgation; various States: See National Institute of Standards and Technology Michigan, 32448–32450 See National Oceanic and Atmospheric Administration Superfund program: NOTICES Toxic chemical release reporting; community right-to- Agency information collection activities; proposals, know— submissions, and approvals, 32506–32507 North American Industry Classification System, 32464– 32478 Commodity Credit Corporation NOTICES RULES Air pollution control: Loan and purchase programs: State fuels programs; boutique fuels; list, 32532–32536 Grains and similarly handled commodities marketing Committees; establishment, renewal, termination, etc.: assistance loans and cotton loan deficiency payments U.S. Government Representative to the Commission for (2006-2007 crop years), 32415–32427 Environmental Cooperation— National and Governmental Advisory Committees, 32536 Cooperative State Research, Education, and Extension Meetings: Service Human Studies Review Board, 32536–32538 PROPOSED RULES Grants: Executive Office of the President National Research Initiative Competitive Grants Program, See Presidential Documents 32479–32484 Farm Credit Administration Defense Department NOTICES See Army Department Meetings; Sunshine Act, 32538

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Federal Aviation Administration Food Safety and Inspection Service RULES NOTICES Airworthiness directives: Meetings: Engine Components Inc., 32427–32434 Codex Alimentarius Commission— Viking Air Ltd., 32434–32436 Agenda items and draft U.S. positions to be discussed PROPOSED RULES at 29th session of CAC; comments request, 32504– Airworthiness directives: 32505 B-N Group Ltd., 32492–32494 Boeing, 32489–32491 Foreign-Trade Zones Board Grob-Werke, 32484–32487 NOTICES Gulfstream, 32487–32489 Applications, hearings, determinations, etc.: Saab, 32491–32492 Texas LeTourneau, Inc.; loading equipment, parts, and components manufacturing and warehousing Federal Energy Regulatory Commission facilities, 32507–32508 PROPOSED RULES Electric utilities (Federal Power Act): Forest Service Transmission service; preventing undue discrimination NOTICES and preference, 32636–32744 Meetings: NOTICES Resource Advisory Committees— Electric rate and corporate regulation combined filings, Southwest Idaho, 32505 32530 Hydroelectric applications, 32530–32531 Health and Human Services Department Meetings: See Centers for Disease Control and Prevention Bulk-power system; North American Electric Reliability See Children and Families Administration Council reliability standards; technical conference, See Food and Drug Administration 32531 NOTICES Xcel Energy Services, Inc.; technical conference, 32532 Grants and cooperative agreements; availability, etc.: Applications, hearings, determinations, etc.: National Faith-Based and National Community CenterPoint Energy Gas Transmission Co., 32528–32529 Cardiovascular Disease Prevention Programs for high risk women, 32538–32552 El Paso Natural Gas Co., 32529 Maritimes & Northeast Pipeline, L.L.C., 32529–32530 Indian Affairs Bureau NOTICES Federal Railroad Administration Liquor and tobacco sale or distribution ordinance: NOTICES Eastern Shawnee Tribe of Oklahoma, 32554–32558 Exemption petitions, etc.: City of Placentia, CA, 32628–32629 Interior Department Gettysburg & Northern Railroad Co., 32629 See Fish and Wildlife Service Hoosier Valley Railroad Museum, 32629–32630 See Indian Affairs Bureau Northeast Illinois Regional Commuter Railroad Corp., See National Park Service 32630 Internal Revenue Service Traffic control systems; discontinuance or modification: RULES MTA Long Island Rail Road, 32630–32631 Income taxes: Expatriated entities and their foreign parents; Section Federal Transit Administration 7874 guidance, 32437–32448 PROPOSED RULES PROPOSED RULES Charter service: Income taxes: Grant recipients prohibition from providing charter bus Expatriated entities and their foreign parents; Section service; negotiated rulemaking advisory committee; 7874 guidance; cross-reference; public hearing, membership and meetings, 32496 32495–32496 International Trade Administration Fish and Wildlife Service NOTICES PROPOSED RULES Antidumping: Endangered and threatened species: Corrosion-resistant carbon steel flat products from— Critical habitat designations— Various countries, 32508–32513 Mussels; Northeast Gulf of Mexico drainages, 32746– Polyester staple fiber from— 32796 Taiwan, 32514–32517 Spikedace and loach minnow, 32496–32503 Uranium from— Russian Federation, 32517–32519 Countervailing duties: Food and Drug Administration Corrosion-resistant carbon steel flat products from— RULES Korea, 32519–32521 Animal drugs, feeds, and related products: Cut-to-length carbon steel plate from— Oxytetracycline; implantation or injectable dosage form, Brazil, 32522–32523 32436–32437 Mexico, 32521–32522

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Spain, 32523–32525 NYSE Arca, Inc., 32619–32626

Labor Department Small Business Administration See Employment and Training Administration NOTICES See Employment Standards Administration Disaster loan areas: See Veterans Employment and Training Service Maine, 32626 Massachusetts, 32626 National Council on Disability New Hampshire, 32626–32627 NOTICES Meetings: Meetings; Sunshine Act, 32600 District and regional advisory councils— Wisconsin, 32627 National Institute of Standards and Technology National Advisory Council, 32627 NOTICES National Small Business Development Center Advisory Agency information collection activities; proposals, Board, 32627 submissions, and approvals, 32525 Social Security Administration National Oceanic and Atmospheric Administration PROPOSED RULES NOTICES Organization and procedures: Agency information collection activities; proposals, Official records and information; privacy and disclosure, submissions, and approvals, 32526 32494–32495 Meetings: International Commission for the Conservation of State Department Atlantic Tunas, U.S. Section Advisory Committee, NOTICES 32526 Foreign Operations, Export Financing, And Related Programs Appropriations Act: National Park Service Section 556 certification, 32627–32628 NOTICES Meetings: National Register of Historic Places; pending nominations, Historical Diplomatic Documentation Advisory 32558–32559 Committee, 32628 Overseas Security Advisory Council, 32628 National Science Foundation NOTICES Transportation Department Meetings: See Federal Aviation Administration GPRA Performance Assessment Advisory Committee, See Federal Railroad Administration 32600–32601 See Federal Transit Administration See Pipeline and Hazardous Materials Safety National Transportation Safety Board Administration NOTICES Meetings; Sunshine Act, 32601 Treasury Department See Internal Revenue Service Nuclear Regulatory Commission NOTICES United States Institute of Peace Meetings; Sunshine Act, 32601–32602 NOTICES Operating licenses, amendments; no significant hazards Grants and cooperative agreements; availability, etc.: considerations; biweekly notices, 32602–32614 Solicited grants— Regulatory guides; issuance, availability, and withdrawal, Spring Competition Program, 32632 32614–32615 Unsolicited grants— Applications, hearings, determinations, etc.: Unsolicited Grant Program, 32632 FirstEnergy Nuclear Operating Co. et al., 32601 Veterans Employment and Training Service Personnel Management Office NOTICES NOTICES Grants and cooperative agreements; availability, etc.: Excepted service; positions placed or revoked, 32615–32617 Homeless Veterans’ Reintegration Program, 32598–32600

Pipeline and Hazardous Materials Safety Administration NOTICES Separate Parts In This Issue Agency information collection activities; proposals, submissions, and approvals, 32631 Part II Energy Department, Federal Energy Regulatory Presidential Documents Commission, 32636–32744 PROCLAMATIONS Special observances: Part III National Child’s Day (Proc. 8026), 32797–32799 Interior Department, Fish and Wildlife Service, 32746– 32796 Securities and Exchange Commission NOTICES Part IV Self-regulatory organizations; proposed rule changes: Executive Office of the President, Presidential Documents, International Securities Exchange, Inc., 32617–32619 32797–32799

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To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http:// Reader Aids listserv.access.gpo.gov and select Online mailing list Consult the Reader Aids section at the end of this issue for archives, FEDREGTOC-L, Join or leave the list (or change phone numbers, online resources, finding aids, reminders, settings); then follow the instructions. and notice of recently enacted public laws.

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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.

3 CFR Proclamations: 8026...... 32799 7 CFR 1421...... 32415 1427...... 32415 Proposed Rules: 3411...... 32479 14 CFR 39 (2 documents) ...... 32427, 32434 Proposed Rules: 39 (5 documents) ...... 32484, 32487, 32489, 32491, 32492 18 CFR Proposed Rules: 35...... 32636 37...... 32636 20 CFR Proposed Rules: 401...... 32494 402...... 32494 21 CFR 522...... 32436 26 CFR 1...... 32437 Proposed Rules: 1...... 32495 40 CFR 52...... 32448 69...... 32450 372...... 32464 49 CFR Proposed Rules: 604...... 32496 50 CFR Proposed Rules: 17 (2 documents) ...... 32496, 32746

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Rules and Regulations Federal Register Vol. 71, No. 108

Tuesday, June 6, 2006

This section of the FEDERAL REGISTER telephone (202) 720–9154; facsimile the quantity or quality of the contains regulatory documents having general (202) 690–1536; e-mail: commodity), and retain all decision applicability and legal effect, most of which [email protected]. Persons making and rights to the movement and are keyed to and codified in the Code of with disabilities who require alternative disposition of the commodity. This key Federal Regulations, which is published under means for communication (Braille, large component of the CCC loan program is 50 titles pursuant to 44 U.S.C. 1510. print, audiotape, etc.) should contact the recognized by Congress as evidenced in The Code of Federal Regulations is sold by USDA Target Center at (202) 720–2600 sections 1204(f) and 1307(d)(2) of the the Superintendent of Documents. Prices of (voice and TDD). 2002 Act. Related to this concept is that new books are listed in the first FEDERAL SUPPLEMENTARY INFORMATION: commodities that are purchased, REGISTER issue of each week. substituted for another commodity of I. Statutory Background the same type, bartered, or processed, or Since the enactment of the altered from it’s natural form may not be DEPARTMENT OF AGRICULTURE Agricultural Act of 1949, the major pledged as collateral for CCC loans. This activity of CCC has been the concept is embodied in section 1201(b) Commodity Credit Corporation administration and implementation of of the 2002 Act, which limits the nonrecourse loans to producers of major availability of CCC marketing assistance 7 CFR Parts 1421 and 1427 agricultural commodities. Generally, loans to the ‘‘quantity of a loan RIN 0560–AH38 Congress established loan rates for commodity produced on the farm.’’ certain commodities on a per unit basis, Since 1949, commodities pledged as Grains and Similarly Handled e.g. $1.95 per bushel for corn or $.52 per collateral for these loans could be stored Commodities-Marketing Assistance pound of upland cotton for the 2004 on the producer’s farm or in approved Loans and Loan Deficiency Payments through 2007 crop years. Under a warehouses. Historically, approved for the 2006 Through 2007 Crop Years; nonrecourse loan provisions, the warehouses have been warehouses that Cotton producer may satisfy the loan obligation entered into storage agreements with AGENCY: Commodity Credit Corporation, through forfeiture to CCC of the CCC that set forth terms and conditions USDA. commodity pledged as collateral for the regarding: (1) Financial aspects of the ACTION: Final rule. loan. Thus, if the per unit market price warehouse; (2) rates that are applicable of the commodity was less than the to the storage of CCC-owned inventory SUMMARY: This rule amends regulations Congressionally established loan rate, and CCC loan collateral; (3) handling governing the Marketing Assistance the producer could satisfy the loan and delivery charges with respect to Loan (MAL) and Loan Deficiency obligation by delivery of the pledged these commodities; and (4) related Payment (LDP) Program of the commodity to CCC. Since the inception storage issues. Most States, as well as Commodity Credit Corporation (CCC). of nonrecourse loans, producers could the Department of Agriculture (USDA), These amendments affect regulations only pledge as collateral for securing the have a warehouse licensing regime for governing: (1) Beneficial interest with nonrecourse loan commodities that the storage of agricultural commodities. respect to eligible commodities were not subject to liens. If such liens An entity wishing to engage in storing delivered to facilities other than existed on the commodity pledged as these commodities must, in virtually all licensed warehouses, such as feedlots, collateral, lien waivers were required to States, have a State or Federal license to ethanol plants, wool pools, and other be obtained from all lien holders to engage in such business. These licensed facilities determined by CCC to be the ensure CCC’s interest was fully entities issue warehouse receipts that end user of the commodity; (2) the protected. Also, since the inception of evidence ownership of commingled announcement of the adjusted world these loans, in order to make certain commodities. Generally, those non- price (AWP) for rice; (3) CCC lien that the benefits of these loans go to the licensed entities in States with licensing searches and the fees necessary to producers and no other party, CCC programs may not store agricultural record and file liens on marketing made nonrecourse loans to only those commodities on behalf of producers but assistance loans; (4) the liability of a producers that maintain ‘‘beneficial are free to purchase commodities from producer who improperly disposes of interest’’ in the commodity at the time producers. Accordingly, in such States, pledged loan collateral for a CCC farm- the loan is made and maintain commercial feed lots, ethanol plants, stored loan; (5) producers’ beneficial interest throughout the loan wool pools and other entities that are responsibilities for requesting loan period. the ‘‘end users’’ of the commodity are deficiency payments; and (6) general Beneficial interest has been viewed by not licensed warehouses and, therefore, eligibility requirements for cotton CCC as consisting of three attributes may not store commodities on behalf of pledged as collateral for a marketing which include: producers. Similarly, CCC considers assistance loan. • Title; producers to have lost beneficial interest DATES: Effective Date: This rule is • Risk of loss; and in the commodity upon delivery to such effective June 6, 2006. • Control. facilities and producers may not pledge FOR FURTHER INFORMATION CONTACT: Accordingly, at the time the producer as collateral for a CCC loan, Kimberly Graham, Program Manager, requested a loan from CCC, through the commodities delivered to these facilities Marketing Assistance Loans and LDP earlier of loan repayment or loan (except as provided for by the 2002 Act). Programs, Price Support Division, FSA/ maturity, the producer must own the In those States that do not have such a USDA, STOP 0512, 1400 Independence commodity, have all risk in the licensing regime, warehouses must still Ave., SW., Washington, DC 20250–0512; commodity (if there is a loss in either follow State laws relating to bailment

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and storage. The State laws relating to immediately repaid at the lower Agriculture reported 2.3 million farms.3 bailment and storage may vary from repayment rate. In return for the Despite the slowing decline in farm State to State. payment, referred to as ‘‘loan deficiency numbers, the size of farm operations As a result of the accumulation of payment (LDP), the producer agrees that continues to grow. In 1974, there were large quantities of commodities the quantity of the commodity which 32,752 farms with 1,000 acres or more forfeitures under nonrecourse loans, in was used in determining the payment land. In 2002, there were 176,990 farms the mid-1980’s Congress instituted a will not be pledged as collateral for a with 1,000 acres of more land. The fundamental change to CCC loan CCC marketing assistance loan. number of farms with 2,000 acres or programs when market prices are below The LDP amount is equal to the more increased more than 13 fold the CCC loan rate. In addition to established loan rate for the applicable during this time, going from only 5,862 allowing producers the option to forfeit loan commodity less the repayment rate farms in 1974 to 77,970 farms in 2002. the commodity pledged as collateral for multiplied by the eligible quantity of the Accompanying this consolidation in nonrecourse loans, producers were also commodity. With respect to farm numbers and growth in farm size allowed the opportunity to repay the commodities such as cotton, wheat, rice, has been a similarly dramatic nonrecourse loan at a price determined feed grains, minor oilseeds, wool, consolidation in the livestock and by CCC and to retain any difference mohair and pulse crops; section 1205 of poultry feeding sectors. Based on the between the amount of the loan made by the 2002 Act provides that these U.S. Census of Agriculture, 3 out of using the established county loan rate payments are made with respect to every 4 farms had cattle and 1 out of and the repayment of the loan at the ‘‘producers on a farm that, although every 2 farms had hogs in 1950. In 2002, market price. These loans are referred to eligible to obtain a marketing assistance only 1 in every 2 farms had cattle, and as ‘‘marketing assistance loans’’. loan under section 1201 with respect to only 1 in every 25 had hogs. Numbers Nine-month marketing assistance a loan commodity in return for loan are just as dramatic for poultry. In 1950, loans are made available under the 2002 deficiency payments * * *.’’ A similar 4 of every 5 farms had chickens or Act for specified commodities. Most provision is set forth in section 1307 of turkeys. In 2002, only 1 out of every 14 CCC commodity loans are marketing the 2002 Act for producers of peanuts. farms had chickens or turkeys. The assistance loans with the exception of With some technical exceptions for consolidation of cattle, hog, and poultry nonrecourse loans made available to cotton, an LDP may be made to a feeding into fewer and larger capital- sugar processors. Marketing assistance producer only if the commodity could intensive operations has shifted feed use loans accomplish two objectives. First, otherwise serve as collateral for a CCC away from the farms where grains and they provide producers with interim marketing assistance loan. oilseeds are produced. This has left financing to continued farming II. The 2002 Farm Security Rural and grain and oilseed producers increasingly operations without having to market reliant on commercial grain marketing their crop during periods of low market Investment Act—Legislative Mandates channels as outlets for their production prices. Second, these loans facilitate the The manner in which agricultural and sources of their revenue. orderly marketing and distribution of commodities are marketed and used has Figure 1 demonstrates the significant commodities throughout the year. As a changed substantially since the impact these structural changes have result of this lower repayment option, enactment of the Agricultural Act of had on the amount of grain used on the CCC takes possession of less than .4 1949. Changes in commodity marketing farms where it is produced. During the percent of the commodities pledged as and use have been driven in part by the 1949/50 marketing year just more than collateral for marketing assistance loans. dramatic consolidation in farm half of all grain and oilseed (wheat, Eligible producers may request a operations since the middle 1900’s. corn, barley, oats, rye, sorghum, rice, marketing assistance loan on or before Advances in agronomics and and soybeans) production was the final loan availability date for the technology, including biotechnology, consumed on the same farms where it applicable commodity. Eligible have allowed producers to significantly was produced. Since then, while commodities pledged as collateral for a expand the sizes of their operations and production of these commodities has marketing assistance loan must be free benefit from crop specialization and increased more than 3 fold, the amount and clear of all liens and encumbrances economies of scale. Coincident to this used on the same farm where it was and no additional liens or have been structural changes in the produced has dropped by more than encumbrances may be placed on the livestock and poultry feeding sectors one-third. The bulk of this decline in commodity after the marketing and the remarkable growth in ethanol on-farm use reflects consolidation in assistance loan is approved. The amount production. These changes have pushed livestock and poultry feeding and of the monetary gain that producers may larger and larger quantities of specialization in grain and oilseed obtain by repaying CCC marketing agricultural commodities into farming. It also reflects the phenomenal assistance loans at repayment rates commercial marketing channels and expansion in fuel ethanol production below their established county loan rate away from the primary on-farm uses of which has grown from a negligible share can be substantial. Therefore, there is a the early 1900’s. significant incentive for a producer to Based on the U.S. Census of of domestic corn use in the 1970’s to obtain these loans solely for this benefit; Agriculture, the number of U.S. farms more than 12 percent of domestic use however, both the producer and CCC dropped from 5.4 million in 1950 to 2.1 during the 2004/05 marketing year. Less incur costs in completion of the loan million in 2002.1 Much of the loss in significant, but also affecting this transaction due to costs associated with farm numbers, however, occurred by the decline in on-farm use has been the shift lien searches and lien filing fees as well mid-1970’s.2 The 1974 Census of away from bin-run seed in the small as USDA personnel costs incurred in grains and soybeans as commercial seed processing these loans. To reduce the 1 U.S. Bureau of the Census, U.S. Census of costs associated to the delivery of this Agriculture: 1950. Vol. II, General Report, Statistics Department of Agriculture, Washington DC, June benefit, producers may simply request by Subjects. U.S. Government Printing Office, 2004. Washington, DC, 1952. 3 Bureau of the Census, 1974 Census of that a payment be made to them in an 2 National Agricultural Statistics Service, 2002 Agriculture. Vol. I, Part 51, United States Summary amount equal to what would be realized Census of Agriculture. Summary and State Data. and State Data. U.S. Department of Commerce, if the loan had been made and Vol. 1, Geographic Area Series, Part 51. U.S. Washington DC, December 1977.

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varieties have become ever more dominant.

The decline in on-farm use has marketed commercially has increased 6 provisions which have given CCC tools substantially increased the volume of fold, twice the 3 fold increase in like alternative marketing loan grain moving through commercial production. repayment rates and the LDP which marketing channels. In the early 1950’s, CCC nonrecourse loan provisions have significantly reduced the quantity 50 percent of all grain and oilseed have been modified over the years to of loan collateral forfeited to CCC. With production was sold commercially. In better reflect the needs of producers greater ability to minimize forfeitures, recent years, 90 percent of all grain and who must respond to these changes in CCC inventories and quantities of grains oilseed production has been sold commodity marketing and use. and oilseeds otherwise controlled by commercially. As on-farm use has fallen Particularly important in this regard has CCC have declined dramatically since since 1949/50, the volume that is been the marketing assistance loan the 1980’s, as shown in Figure 2.

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Congress has recognized the impact deficiency payments if the facility is not Good Faith Exception to Beneficial that changing agricultural commodity authorized by State or Federal law to Interest markets have had on producers and store such commodities for the benefit Section 1204(f) of the 2002 Act CCC’s ability to ensure that all of producers. This provision provides a provides relief to those producers of producers of major commodities are limited opportunity for producers who 2001 crops of commodities for which eligible for marketing assistance loan deliver their commodities to a facility marketing assistance loans were benefits. Congress included special such as a feedlot, ethanol plant, wool obtained but had lost beneficial interest provisions in the 2002 Act to address pool, or other facilities to receive in the commodity prior to the specific situations that result in benefits associated with the use of CCC- repayment of the loan. This relief was producers becoming ineligible for these issued commodity certificates to acquire further restricted to those producers benefits or to provide other assistance in commodities pledged as collateral for a who acted in good faith, but had lieu of such benefits. These provisions CCC marketing assistance loan so long nonetheless not complied with program of the 2002 Act are set forth in sections as the loan making transaction and regulations, and provided that the 1201(c); 1204(h); 1205(a)(2),(f); 1206; certificate exchange transaction producer be allowed to receive program 1209; and 1307(c)(2), and 1307(e)(4)(B). authorized by section 166 of the Federal benefits as of the date beneficial interest Treatment of Certain Commingled Agriculture Improvement and Reform was lost. Since this provision was Commodities Act of 1996 occur at the same time. viewed to be self-enacting and Section 1201(c) of the 2002 Act states: Again, this provision takes into applicable for only the 2001 crop year, the regulations at 7 CFR part 1421 do ‘‘* * * the Secretary shall make loans to consideration that producers who deliver commodities to these facilities not contain any references to these producers on a farm that would be eligible sections of the 2002 Act. to obtain a marketing assistance loan, but for lose beneficial interest in the the fact the loan commodity owned by the commodity upon delivery. Such Unshorn Lamb Pelts, Hay and Silage producers on the farm commingled with loan facilities are not authorized to act as Section 1205(a)(2) of the 2002 Act commodities of other producers in facilities bailees with respect to the commodity unlicensed for the storage of agricultural states: commodities by the Secretary or a State and, similarly, may not issue documents presenting title to another party on Non-graded wool in the form of unshorn licensing authority, if the producers lamb pelts and hay and silage derived from obtaining the loan agree to immediately behalf of the person delivering the a loan commodity are not eligible for a redeem the loan collateral in accordance with commodity to the facility. CCC has marketing assistance loan under section section 166 of the Federal Agriculture administered this provision through the 1201. However, effective for the 2002 through Improvement and Reform Act of 1996 (U.S.C. use of Form CCC–677, Farm Storage 2007 crop years, the Secretary may make loan 7286).’’ Note and Security Agreement, and has deficiency payments available under this This provision recognizes that not set forth specific provisions in 7 section to producers on a farm that produce producers who deliver a commodity to unshorn lamb pelts or hay and silage derived CFR part 1421, but has utilized the from a loan commodity. a facility where the commodity is regulations at 7 CFR part 1401 with commingled with commodities from respect to commodity certificate Section 1205(b) sets forth the rates to other producers are ineligible for exchanges. be used in making these payments. This marketing assistance loans and loan provision takes into account that some

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producers of a commodity that could be assistance to producers without altering regulatory burdens on producers, the used to obtain a marketing assistance their normal production patterns, and is following revisions are made in 7 CFR loan, but for the manner in which it was carried out by CCC through the use of parts 1421 and 1427. processed by the producer, could still be Form CCC–633, Grazing, and the A. Rice Adjusted World Price used to obtain a loan deficiency regulations at 7 CFR 1421.300 though Announcement Time (1421.10 Market payment. The need for this provision is 307. Rates) best understood by looking at corn that Recourse Loans for High Moisture Corn is used as silage. Corn that is harvested Loan rates for farm-stored rice, or rice and Grain Sorghum and Seed Cotton in a ‘‘whole kernel’’ form may be for which the grade and milling yield pledged as collateral for a marketing Section 1209 of the 2002 Act provides are not determined, are based on state assistance loan and in the event the loan that CCC will make available recourse average grade and milling qualities for is not repaid at the end of nine months, loans to producers of 2002 through 2007 the prior five years. The warehouse- CCC can take possession of the corn, crops of high moisture corn and grain stored rice loan rates are based on class, which will, assuming proper care has sorghum. Similar to corn harvested as quality, and milling yield been taken during the nine months, be silage, corn and grain sorghum determinations obtained from a grading in the same condition as when the loan harvested with a high moisture content and milling sample of the individual lot was made. But, in the case of silage, the are not suitable for delivery to CCC in of rice. The national average rough rice entire corn stalk is harvested and the the event of a forfeiture of a marketing loan rate is used to determine farm- stalk and the corn kernel are inter- assistance loan. Commodities with a stored loan proceeds in States other mingled and chopped, which renders high moisture content deteriorate in than the six major rice-producing States. the corn worthless to CCC in the event condition quickly and have never been Grade and quality factor discounts of forfeiture; however, the corn silage is accepted by CCC in satisfaction of a apply when rice is delivered to CCC merchantable mostly for feeding nonrecourse loan. However, the upon loan maturity. CCC announces the purposes. Therefore, producers may harvesting of corn and grain sorghum in rice adjusted world price (AWP) every obtain a loan deficiency payment by such a state is a normal production Tuesday at 3 p.m. eastern standard time submitting a request for benefits using practice, and under section 1209 (EST). The AWP is used to determine either form CCC–633 LDP, or CCC–709 producers of these crops may receive the applicable repayment and LDP rates. for silage and hay; and CCC–633 Pelt or low interest nine-month recourse loans If Tuesday is a Federal holiday or is not CCC–709 Pelt for unshorn lamb pelts, from CCC. Such commodities may not a Government workday, the AWP and the regulations at 7 CFR 1421.200(c) be pledged as collateral for a marketing announcement is made on the next and (d). assistance loan, and thus, also are not workday. Because the AWP is eligible for a loan deficiency payment. announced in the middle of a workday, Special Loan Deficiency Payment Rules The regulations used to administer this marketing assistance loan repayments for 2002 Crop Year Commodities provision are found at 7 CFR 1421.115 and loan deficiency payment requests Sections 1205(f) and 1307(c)(2) of the and CFR 1427, Subpart D, for seed are not accepted on Tuesday between 2 2002 Act provide special rules for the cotton recourse loans. The loan p.m. and 3 p.m. EST. This window of 2002 crops of wool, mohair, honey, dry agreements are Forms CCC–677, Farm time is commonly referred to as the peas, lentils, small chickpeas; and Storage Note and Security Agreement ‘‘dead hour’’. Marketing assistance loan peanuts, respectively, in recognition of and CCC–881, for cotton seed loans. repayments and loan deficiency the extension in the 2002 Act of payment requests received on Tuesday III. Major Changes marketing loan and loan deficiency before 2 p.m. EST are based on the rate payment benefits to producers of these In administering Title I of the 2002 in effect before the 3 p.m. EST commodities who may have lost Act for marketing assistance loans and announced AWP. All marketing beneficial interest in the commodity loan deficiency payments, CCC has assistance loan repayments and loan prior to the issuance of regulations used decided to amend 7 CFR parts 1421 and deficiency payment requests received in the administration of these programs. 1427 to account for the evolution of after 3 p.m. EST are based on the AWP These provisions are reflected in 7 CFR marketing patterns in those announced on that Tuesday. This rule 1421.6(b) and (c). commodities subject to these changes the AWP announcement time regulations, and remove necessary for rice to on or after 7 a.m. EST each Grazing Payments in Lieu of Loan burdens on producers of such Wednesday. The announced AWP will Deficiency Payments commodities to obtain a marketing be effective upon announcement thus Section 1206 of the 2002 Act provides assistance loan or loan deficiency eliminating the ‘‘dead hour’’ that a producer of the 2002 through payment. Similar amendments are made requirement. As a result, 7 CFR part 2007 crops of wheat, barley, and oats in 7 CFR part 1427 to clarify 1421.10(c)(5)(i) is revised and who is otherwise eligible to receive a determinations of whether a producer 1421.10(c)(6) deleted. loan deficiency payment for such a crop maintains beneficial interest in cotton but, instead of harvesting the tendered for a nonrecourse loan and for B. Handling Payments and Collections commodity ‘‘elects to use acreage liquidated damages assessed when there (1421.13) planted to the wheat, barley, or oats for is a breach of the CCC loan agreement 7 CFR 1421.13 sets forth the policy of the grazing of livestock’’ (and producers or loan deficiency payment agreement. CCC in handling the issuance of of triticale) to receive a payment based In order to: (1) Enhance the manner in marketing assistance loans and loan upon the loan deficiency payment rate which marketing assistance loans and deficiency payments of $9.99 or less and in effect for such commodity (with loan deficiency payments are made to the collection of debts arising from such respect to triticale, since there is no producers by CCC; (2) provide greater loans and payments in amounts of $9.99 such rate, the wheat payment rate is clarity with respect to the manner in or less. This rule deletes this section used) on the date the producer signs an which the marketing assistance loan and since CCC routinely issues payments agreement with CCC to participate in loan deficiency payment provisions of and loans regardless of amounts and this special program. Again, this the 2002 Act are set forth in program CCC debt collection policies are already provision is intended to provide regulations; and (3) reduce unnecessary set forth at 7 CFR part 1403.

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C. Liens and Filing of Security Interest referred to as ‘‘unauthorized removal’’ 633 EZ and a request for benefits which and Financing Statements (1421.104) and ‘‘unauthorized disposition.’’ When is either page 2, 3, or 4, depending on Lien searches are conducted by CCC the producer is determined to have the requested commodity. Form CCC– when a producer requests a marketing committed a violation, the FSA County 633 EZ, Page 1 allows the producer to assistance loan. These searches are Committee, on behalf of CCC, must indicate their intentions to receive loan conducted to ensure that CCC will be make a determination as to whether the deficiency payments at a time well in able to obtain clear title to any producer acted in ‘‘good faith’’ in advance of the time that they could commodity forfeited to CCC in moving or disposing of the loan inadvertently lose beneficial interest. satisfaction of a marketing assistance collateral in violation of the loan The CCC–633 EZ, Page 1, Agreement, loan. Currently, CCC is responsible for agreement. If the FSA County must be filed in the applicable FSA Committee determines the producer Service Center before loss of beneficial the costs associated with conducting the acted in ‘‘good faith,’’ a producer with interest. A producer may submit the lien search and the filing fees for the two or fewer violations must repay the CCC–633 EZ, Page 1, Agreement, prior applicable financing statements. CCC marketing assistance loan quantity to the harvest, shearing or slaughter of surveyed FSA offices in all 50 States involved in the violation at the lesser of the commodity (but not before the regarding the costs and it was principal plus interest, or the applicable applicable crop year) throughout any determined that the average cost, per announced alternative repayment rate in time during the marketing assistance loan, to conduct a lien search and file effect on the date the violation occurred, loan availability period. The request for a financing statement was plus liquidated damages in an amount LDP benefits page must be submitted approximately $17.00. Due to the major equal to 10 percent of the loan rate. CCC before the applicable final loan budget constraints facing the has found it very difficult to determine availability date; however, the request Department of Agriculture, a review was the exact date in which a violation may for benefit (pages 2, 3 or 4) can be undertaken concerning policies have occurred. Therefore, this rule submitted either before or after loss of regarding lien searches and the filing of amends 7 CFR 1421.109 to provide that beneficial interest. This form became financing statements to determine if the producer must repay the marketing available for the 2005 crop year. these costs could be reduced. CCC assistance loan quantity involved in the Accordingly, this rule amends 7 CFR conducted a comprehensive review of violation based on the repayment rate in 1421.200 and 1427.23 to set forth its loan-making actions and determined effect on the date the violation was policies associated with the use of the that in crop year 2003 only 112 of discovered by CCC. If CCC determines new CCC–633 EZ form. 37,246 farm-stored loans with a that there had been an unauthorized F. Loan Deficiency Payment Rates principal amount of $25,000 or less removal or disposition of loan collateral were satisfied by forfeiture of the loan after the loan had been repaid, such In order to more accurately reflect collateral to CCC. (0.3%). action will be considered a violation for variations in market prices for the same Approximately, $633,182 was expended purposes of future administration of this commodity that reflect the geographic to file lien searches and record provision. With respect to instances in location of a producer’s farm, CCC has financing statements for those loans. which a producer has committed two historically established loan rates on a Results of the review also indicated that such violations, CCC has also county-by-county basis for many the settlements and forfeitures have determined that liquidated damages in commodities. This creates a situation been very minimal over several crop an amount equal to 25 percent of the where a crop may be produced in a years in comparison to the number of loan rate is excessive and this rule will county but is stored or marketed in a marketing assistance loans disbursed. reduce this amount to 10 percent. different county with a different loan Accordingly, this rule amends 7 CFR rate. Section 7 CFR 1421.201 is revised 1421.104 and 1427.12 to provide that E. Loan Deficiency Payments (1421.200; to clarify that, in those instances where CCC will conduct lien searches for all 1427.23) a commodity is stored in a county other loans types greater than $25,000 and file Loan deficiency payments made than where the commodity was financing statements only for farm- under 7 CFR parts 1421 and 1427 are produced, the loan deficiency payment stored marketing assistance loan currently requested by producers by rate will be the rate for the county disbursements of $25,000 or more. CCC using: (1) Form CCC–709 Field Direct where the commodity is stored or believes this will reduce costs without LDP; (2) Form CCC–633 LDP; (3) CCC– marketed. increasing CCC’s risk of forfeitures. CCC 633 Pelt; (4) CCC–709 Pelt; (5) Cotton G. Beneficial Interest may, however, conduct lien searches AA; and through the online CCC eLDP and file financing statements for loan process. Each crop year, numerous As noted in the background disbursements less than $25,000 when producers fail to submit an applicable discussion in this preamble, the concept there is reason to believe that CCC’s loan deficiency payment request for of ‘‘beneficial interest’’ is a core feature interest will not be protected. program benefits before beneficial of the CCC nonrecourse loan programs interest is lost in the commodity. since 1949, is embodied in the 2002 Act, D. Personal Liability of the Producer Producers and other members of the and consists of three parts: Title to the (1421.109) agricultural industry have attributed the commodity must be with the producer; The terms of the marketing assistance loss of benefits to the use of multiple control of the commodity must remain loan agreements include provisions that forms to obtain the same benefit and the with the producer; and the producer obligate the producer to undertake lack of understanding about beneficial must retain risk of loss in the certain actions. One of the more interest. In an effort to simplify this commodity in the event of its important provisions of the loan process, CCC recently issued a new destruction. For many years, this agreement is the requirement that the form, Form CCC–633 EZ, Loan provision was readily applied as the producer agrees to not remove or Deficiency Payment (LDP) Agreement commodities subject to 7 CFR parts dispose of any quantity of commodity and Request, for use in the 2005 and 1421 and 1427 were either used as feed that is pledged as collateral for a CCC subsequent crop years. The CCC–633 EZ by a producer on the producer’s farm or farm-stored loan without prior written is a two part form consisting of an delivered to a warehouse for sale or approval from CCC. Such violations are agreement which is page 1 of the CCC– storage. The sale would be a simple

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transaction in which cash, or a check, Since the adoption of these provisions with the commodity produced from would be received by the producer in 7 CFR 1421.6 and 1427.5, CCC has these seeds. In some cases the owner based upon the market price of the not incurred losses similar to those that takes possession of the commodity at commodity upon the date of sale or previously occurred. During the past 15 harvest while in other instances the delivery to the warehouse. years, changes have occurred in commodity remains with the producer Over time, different marketing marketing practices in which producers for some period of time and the owner arrangements have emerged that impact are able to develop marketing strategies may elect to take all or just a portion of the manner in which CCC administers to reduce their risks and to maximize the production. Also, in some cases the these programs. One significant change their returns in the market. For example, owner has right of ‘‘first rejection’’ when made in the marketing assistance and there has been a significant increase in the producer intends to market the crop. loan deficiency payment programs the use of contracts, commonly referred While CCC has attempted to treat these occurred in the early 1990’s as a result to as deferred price contracts and price various situations in such a manner so of litigation arising out of the later contracts, which allow producers as to allow the producer to obtain a bankruptcy of a major cotton merchant. the opportunity to identify their buyers marketing assistance loan or loan Prior to this case, CCC had allowed and establish a sales price prior to deficiency payment with respect to such harvest. Generally, such a contract does producers who had sold their ‘‘equity contractual situations, existing not deprive the producer of the ability interest’’ in their cotton to a merchant regulations do not set forth with clarity to obtain a marketing assistance loan or to still obtain a nonrecourse loan from the manner in which CCC views the use a loan deficiency payment so long as CCC. Under this arrangement, the of these contracts. Accordingly, 7 CFR merchant tendered to the producer a payment for the transaction does not parts 1421 and 1427 are modified to nominal payment that allowed the occur before the loan is repaid or the make clear that these types of contracts merchant, at its option, the right to LDP is requested. Existing regulations do not deprive a producer of these purchase from the producer cotton are not clear on how CCC views these benefits so long as no payment has been pledged as collateral for a CCC contracts. This rule is not intended to received under the contract prior to the nonrecourse loan at anytime prior to the restrict in any manner the ability of a maturity of the loan. In order to producer to obtain nonrecourse loans or request for the marketing assistance loan effectuate the sale, the producer, or the loan deficiency payments, but are made or loan deficiency payment and so long merchant as agent of the producer, had solely to provide greater transparency in as the commodity has not been to first redeem the loan collateral. If the the operation of these programs. Also, in delivered to another party under the loan was not repaid by the maturity the context of this review, CCC has contract. date, CCC took possession of the cotton concluded that there are virtually no H. Application of Regulations to Certain in satisfaction of the loan. situations in which a producer has risk Situations In the case that influences this of loss in a commodity but does not change, a large cotton merchant had have control; in other words, if a To provide producers and purchasers obtained ‘‘equities’’ from a significant producer has control of the commodity, of commodities with a clearer number of cotton producers and had there is some risk of loss. Thus, to understanding of CCC’s policies, 7 CFR obtained financing from several simplify these determinations, 7 CFR 1421.13 is also revised by setting forth financial institutions to fund its 1421.6 and 1427.5 are amended to provisions for making eligibility operations. Unable to fulfill its remove references to risk of loss and to determinations in certain marketing obligations, the merchant filed for clarify actions a producer may take in situations. CCC believes that this will be bankruptcy and its creditors asserted, in the marketing of a commodity prior to especially beneficial in the essence, that their liens extended to all the maturity of CCC loan, or a request administration of sections 1201(c) and property rights of the merchants, for a loan deficiency payment, and still 1205(a)(2) of the 2002 Act as they are including the ‘‘equities’’ purchased by retain title to and control of a applied to the delivery of feed grains to the merchant, and that this interest commodity. facilities such as feedlots, dairies, extended to the cotton even after the Section 1001, ‘‘Definitions’’ of the ethanol plants, and other locations maturity of the CCC loan. As a result of 2002 Act specifically provides that where commodities are delivered by court opinions in this matter, which ‘‘* * * In determining whether a grower of producers to facilities not authorized to held that this interest did extend a hybrid seed is a producer, the Secretary issue warehouse receipts. beyond the maturity of the loan, CCC shall not take into consideration the amended the regulations in 7 CFR parts existence of a hybrid seed contract and shall I. Typographical Error Correction 1421 and 1427 to ensure that this ensure that program requirements do not Section 1421.10 is also amended to practice did not impact its ability, in the adversely affect the ability of the grower to correct a typographical error. Section event of a forfeiture of the commodity receive a payment under this title. 1421.10(b) and (c) were intended to set at maturity, to obtain clear title to the Similarly, there is a growing number forth statutory criteria that are used in commodity. This change is set forth in of situations in which the owners of establishing loan repayment rates for 7 CFR 1421.6(a)(2)(i) and 1427.5(e)(2)(i) genetically-modified seed and other and allows a producer to enter into an similar specialty seeds retain title to the specified commodities but, as currently option to purchase contract with a buyer seed after delivery of the seed to a published, such provisions so that the producer can enter into producer for planting by the producer. inadvertently omit a portion of the marketing contracts prior to the harvest These situations are due in large part to relevant provisions of the 2002 Act. of their crop. The key feature of these the need for the owner of the seed to J. Substitute and Purchase Commodities provisions is that the option to purchase retain title to the seed in order for such must terminate the earlier of: (1) owner to protect its patent rights to the In 7 CFR part 1421 provisions are Maturity of the loan that is secured by seed variety involved in the transaction. added to section 1421.5 to clarify that the commodity; (2) the date CCC claims At harvest, there are various scenarios substituted and purchased commodities title; or (3) such other date that is that may ensue with respect to the are ineligible for marketing assistance provided for in the option. actions that a producer may exercise loans and loan deficiency payments.

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Executive Order 12866 Title I of the 2002 Act shall be made I For the reasons set out in the This rule is issued in conformance without regard to chapter 5 of title 44 preamble, 7 CFR parts 1421 and 1427 with Executive Order 12866, was of the United States Code (the are amended as follows: determined to be not significant and has Paperwork Reduction Act). Accordingly, these regulations and the forms and PART 1421—GRAINS AND SIMILARLY not been reviewed by the Office of HANDLED COMMODITIES— Management Budget. other information collection activities needed to administer the program MARKETING ASSISTANCE LOANS Regulatory Flexibility Act authorized by these regulations are not AND LOAN DEFICIENCY PAYMENTS FOR THE 2002 THROUGH 2007 CROP It has been determined that the subject to review by OMB under the YEARS Regulatory Flexibility Act is not Paperwork Reduction Act. applicable to this rule because the CCC Executive Order 12612 I 1. The authority citation for part 1421 is not required by 5 U.S.C. 533 or any is revised to read as follows: other law to publish a notice of This rule does not have sufficient Federalism implications to warrant the Authority: 7 U.S.C. 7231–7237 and 7931 et proposed rulemaking for the subject seq.; 15 U.S.C. 714b and 714c. matter of this rule. preparation of a Federalism Assessment. The changes in this rule will not have Subpart A—General Environmental Assessment substantial direct effect on States or The environmental impacts of this their political subdivisions or on the I 2. Amend § 1421.1 by adding rule have been considered consistent distribution of power and paragraph (e) to read as follows: with the provisions of the National responsibilities among the various § 1421.1 Applicability. Environmental Policy Act of 1969 levels of government. (NEPA), 42 U.S.C. 4321 et seq., the * * * * * Government Paperwork Elimination Act regulations of the Council on (e) The information collection Environmental Quality (40 CFR parts CCC is committed to compliance with requirements contained in this 1500–1508), and the FSA regulations for the Government Paperwork Elimination regulation (7 CFR part 1421) have been compliance with NEPA, 7 CFR part 799. Act (GPEA) and the Freedom to E-File approved by the Office of Management FSA concluded that the rule requires no Act, which require Government and Budget under provisions if 44 further environmental review because it agencies in general and FSA in U.S.C. chapter 35 and have been is categorically excluded. No particular to provide the public the assigned OMB Numbers 0560–0009 and extraordinary circumstances or other option of submitting information or 0560–0036. unforeseeable factors exist which would transacting business electronically to I 3. Amend § 1421.5 by adding require preparation of an environmental the maximum extent possible. The paragraph (f) to read as follows: assessment or environmental impact forms and other information collection § 1421.5 Eligible commodities. statement. activities required for participation in the program are available electronically * * * * * (f) A commodity that is purchased, Executive Order 12988 through the USDA eForms Web site at substituted, or acquired by sale, gift, This rule has been reviewed in http://www.sc.egov.usda.gov for exchange of an existing harvested, accordance with Executive Order 12988. downloading. The regulation is sheared, or slaughtered commodity, or This rule will preempt State laws that available at FSA’s Price Support through any other transaction is are inconsistent with it. Before any legal Division internet site at http:// ineligible to be pledged as collateral for action may be brought regarding a www.fsa.usda.gov/dafp/psd. a marketing assistance loan; in addition determination under this rule, the Applications may be submitted at the a loan deficiency payment shall not be administrative appeal provisions set FSA county offices, by mail or by FAX. made with respect to such commodities. forth at 7 CFR parts 11 and 780 must be Loan Deficiency Payments may be I exhausted. submitted electronically at http:// 4. Section 1421.6 is revised to read as follows: Executive Order 12372 www.fsa.usda.gov/dafp/psd. § 1421.6 Beneficial interest. This program is not subject to the Federal Assistance Programs (a) To be eligible to receive marketing provisions of Executive Order 12372, The title and number of the Federal which require intergovernmental assistance loans and loan deficiency assistance program found in the Catalog payments, a producer must have consultation with State and local of Federal Domestic Assistance to which officials. See the notice related to 7 CFR beneficial interest in the commodity this final rule applies are Commodity that is tendered to CCC for a marketing part 3014, subpart V, published at 48 FR Loans and Loan Deficiency Payments, 29115 (June 24, 1983). assistance loan or is requested for a loan 10.051. deficiency payment. For the purposes of Unfunded Mandates Reform Act of 1995 List of Subjects this part, the term ‘‘beneficial interest’’ refers to a determination by CCC that a The rule contains no Federal 7 CFR Part 1421 mandates under the regulatory person has the requisite title to and provisions of Title II of the Unfunded Agricultural commodities, Feed control of the commodity that is Mandates Reform Act of 1995 (UMRA) grains, Grains, Loan programs— tendered to CCC as collateral for a for State. Local, and tribal governments agriculture, Oilseeds, Price support marketing assistance loan or is the or the private sector. Thus, this rule is programs, Reporting and recordkeeping commodity that will be used to not subject to the requirements of requirements. determine a loan deficiency payment. A sections 202 and 205 of the UMRA. determination of whether a person has 7 CFR Part 1427 beneficial interest in a commodity is Paperwork Reduction Act Agricultural commodities, Cotton, made by CCC in accordance with this Section 1601(c) of the 2002 Act Loan programs—agriculture, Price part and is not based upon a provides that the promulgation of support programs, Reporting and determination under any State law or regulations and the administration of recordkeeping requirements. any other regulation of a Federal agency.

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(b) Except as provided in paragraph from the time of slaughter for unshorn at the same time that such person (e) of this section, when requesting a pelts, through the date the producer has obtained full title to the land on which marketing assistance loan for a loan elected to determine the loan deficiency such crop was growing; commodity, in order to have beneficial payment rate; (f) If marketing assistance loans and interest in the commodity tendered as (3) Have control of the commodity. loan deficiency payments are made collateral for the loan, a person must: For control such person must have available to producers through an (1) Be the producer of the commodity complete decisionmaking authority approved cooperative marketing as determined in accordance with regarding whether a loan deficiency association in accordance with part § 1421.4; payment will be requested with respect 1425 of this chapter, the beneficial (2) Have had ownership of the to the commodity; when the loan interest in the commodity must always commodity from the time it was planted deficiency rate will be selected; and have been in the producer-member who (with respect to wool and mohair from where the commodity will be delivered the commodity to the time of shearing) through the earlier the maintained prior to the date on which approved cooperative marketing date the loan was repaid or the maturity the loan deficiency payment rate will be association or its member approved date of the loan; determined; cooperative marketing association, (3) Have control of the commodity (4) Not have received any payment except as otherwise provided in this from the time of planting (for wool and from any party with respect to the section. If the producer-member who mohair from the time of shearing) commodity; and delivered the commodity does not retain through the maturity date of the loan. (5) If the commodity has been the right to share in the proceeds from To have control of the commodity, such physically delivered to a location other the marketing of the commodity as person must have complete decision- than a location owned or under the total provided in part 1425 of this chapter, making authority regarding whether the control of the producer, have delivered commodities delivered to an approved the commodity to a warehouse commodity will be tendered as cooperative marketing association shall approved in accordance with collateral for a loan, when the loan will not be eligible to be pledged as § 1421.103(c). Delivery of the be repaid, or if the collateral will be collateral for a marketing assistance loan commodity to a location other than to forfeited to CCC in satisfaction of the or be taken into consideration when a an approved warehouse will result in loan obligations of such person, and loan deficiency payment is made. where the commodity will be the loss of beneficial interest in the (g) A producer will lose beneficial maintained during the term of the loan; commodity on the date of physical interest in a commodity if the producer (4) Not have received any payment delivery and the producer will be receives any payment from any person from any party with respect to the considered to have lost beneficial under any contractual arrangement with commodity; and interest as of 11:59 p.m. of such day. (5) If the commodity has been Accordingly, delivery of a commodity to respect to a commodity if the person physically delivered to a location other entities such as a dairy, feedlot, ethanol who is making the payment, or any than a location owned or under the total plant, wool pool, feed mill, or person otherwise associated with the control of the producer, have delivered unapproved storage facility, will result person making the payment, will at any the commodity to a warehouse in the loss of beneficial interest as of the time have title to the commodity or approved in accordance with date of delivery, regardless of any other control of the commodity prior to or § 1421.103(c). Delivery of the action or agreement between such an after harvest, shearing, or slaughter commodity to a location other than to entity and the producer unless such an unless: such an approved warehouse will result entity has been approved by CCC under (1) Such payment is authorized in in the loss of beneficial interest in the § 1421.103(c). accordance with part 1425 of this commodity on the date of physical (d) Notwithstanding any provision of chapter; or delivery and the producer will be paragraphs (b) and (c) of this section (2) The payment is made as considered to have lost beneficial and § 1421.5(f), in order to facilitate consideration for an option to purchase interest as of 11:59 p.m. of such day. handling situations involving the death the commodity and such option Accordingly, delivery of a commodity to of a producer, CCC will consider an contains the following language: entities such as a dairy, feedlot, ethanol estate, heirs of the deceased producer, Notwithstanding any other provision plant, wool pool, feed mill, or other and a person to whom title to a of this option to purchase or any other facilities as determined by CCC will commodity has passed by virtue of State contract, title and control of the result in the loss of beneficial interest as law upon the death of the producer to commodity and beneficial interest in the of the date of delivery, regardless of any have beneficial interest in a commodity commodity as specified in 7 CFR 1421.6 other action or agreement between such produced by the producer under the shall remain with the producer until the an entity and the producer unless such same terms and conditions that would buyer exercises this option to purchase an entity has been approved by CCC otherwise be applicable to such the commodity. This option to purchase under § 1421.103(c). producer; shall expire, notwithstanding any action (c) Except as provided in paragraph (e) Notwithstanding any provision of or inaction by either the producer or the (e) of this section, when requesting a paragraphs (b) and (c) of this section buyer, at the earlier of: loan deficiency payment for a loan and § 1421.5(f), a person who purchases (1) The maturity of any Commodity commodity, in order to have beneficial or otherwise acquires a commodity from Credit Corporation (CCC) loan that is interest in the commodity a person a producer under any circumstances secured by such commodity; must: does not obtain beneficial interest to the (2) The date CCC claims title to such (1) Be the producer of the commodity commodity whether such purchase or commodity; or as determined in accordance with acquisition is made prior to the harvest (3) Such other date as provided in this § 1421.4; of the crop or after harvest; however, option. (2) Have had ownership of the CCC will consider a person to have (h) Inclusion in a contract of one or commodity from the time it was beneficial interest in a commodity if, more of the following types of planted, with respect to wool and prior to harvest, such person has provisions will not result in the loss of mohair from the time of shearing, or obtained title to the growing commodity beneficial interest in a commodity:

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(1) A provision that allows the (2) To the extent practicable, CCC assistance loan under subpart B of this producer to select the sales price of the shall determine and announce part. commodity at the time the contract is periodically an alternative repayment entered into or at a later date, for rate for peanuts, wool, and mohair to: Subpart B—Marketing Assistance example, a contract normally referred to Minimize loan forfeitures of such Loans as a deferred price contract or a price commodities; minimize the Federal I later contract; or Government-owned inventory of such 7. Amend § 1421.104 by revising (2) A provision in contract between commodities; minimize the storage costs paragraph (a) to read as follows: the producer and a warehouse approved incurred by the Federal Government; § 1421.104 Marketing assistance loan in accordance with § 1421.103(c) for the allow such commodities produced in making. storage of CCC loan collateral that the United States to be marketed freely (a)(1) CCC will conduct lien searches provides the producer with no more and competitively domestically and with respect to all commodities pledged than 15 days from the date of physical internationally; and minimize as collateral for marketing assistance delivery of the commodity to the discrepancies in marketing loan benefits loan disbursements in amounts greater warehouse to elect whether the across State boundaries and across than $25,000 and perfect its security commodity is to be stored on behalf of county boundaries. interest in such commodity as provided the producer or is to be considered * * * * * for under State law. With respect to transferred to the warehouse, for (5) The adjusted world price for each marketing assistance loan example, a contract normally referred to class of rice, loan rate basis, shall be disbursements of $25,000 or less, CCC as an open storage contract. determined by CCC and announced, to may conduct a lien search when it is (i) Commodities produced under a the extent practicable, on or after 7 a.m. determined that CCC’s interest is at risk contract in which the title to the seed Eastern Standard Time each Wednesday and perfect its security interest in such remains with the entity providing the or more frequently as determined commodity as provided for under State seed to the producer, including necessary by CCC, continuing through law. In all instances, if a producer has contracts for the production of hybrid the later of: violated the provisions of this part in seed, genetically modified commodities, (i) The last Wednesday of July 2007; the crop year preceding the crop year in and other specialty seeds as approved in or which the marketing assistance loan is writing by CCC, are eligible to be (ii) The last Wednesday of the latest being requested, CCC will conduct a pledged as collateral for a marketing month the 2007-crop rice loans mature, lien search with respect to all assistance loan and a loan deficiency or commodities pledged as collateral for a payment may be made with respect to (iii) In the event that Wednesday is a marketing assistance loan and perfect its such production if, at the time of the non-workday, the determination will be security interest in such commodity as request for such a loan or payment, the made on the next work day, on or after provided for under State law. producer has not: 7 a.m. Eastern Standard Time. (2) The cost for terminating the (1) Received a payment under the I 6. Revise § 1421.13 to read as follows: financing statement for marketing contract; or assistance loans disbursed under (2) Delivered the commodity to § 1421.13 Special marketing assistance paragraph (a)(1) of this section before another person. loans and loan deficiency payments. the end of the term shall be paid by the I 5. Amend § 1421.10 by revising (a) Commodities stored in an producer. paragraphs (b)(2), (c)(2), and (c)(5) to unapproved storage facility may be (3) If there are any liens or read as follows, and removing paragraph pledged as collateral for a marketing encumbrances on the commodity (c)(6): assistance loan if the producer: pledged as collateral for a marketing (1) Makes a request for the marketing assistance loan made under this part, § 1421.10 Market rates. assistance loan and obtains the waivers that fully protect CCC’s interest * * * * * commodity certificate to immediately must be obtained even though the liens (b) * * * exchange for the requested loan or encumbrances are satisfied from loan (2) To the extent practicable, CCC collateral at the same time at the county proceeds disbursed under this part. No shall determine and announce the office that, under part 718 of this title, additional liens or encumbrances shall alternative repayment rate, based upon is responsible for administering the be placed on the commodity after such the market prices at appropriate U.S. programs for the farm on which the a loan is approved. markets as determined by CCC, to: commodity was produced. * * * * * Minimize loan forfeitures of such (2) Submits the marketing assistance I 8. Amend § 1421.109 by revising commodities; minimize the Federal loan request and the commodity Government-owned inventory of such paragraphs (d), (e), (f), (g), and (h) to certificate exchange before or on the read as follows: commodities; minimize the storage costs date of delivery to the unapproved incurred by the Federal Government; facility. § 1421.109 Personal liability of the allow such commodities produced in (b)(1) Eligible producers of unshorn producer. the United States to be marketed freely pelts produced from live sheep and hay * * * * * and competitively domestically and and silage derived from an eligible loan (d) Liquidated damages assessed in internationally; and minimize commodity as provided in § 1421.5 are accordance with this section will be discrepancies in marketing loan benefits eligible to request unshorn pelt, hay, determined by multiplying the quantity across State boundaries and across and silage quantities for a loan involved in the violation by 10 percent county boundaries. The alternative deficiency payment under subpart C of of the marketing assistance loan rate repayment rate may be adjusted to this part. applicable to the loan note. reflect quality and location for each crop (2) Unshorn pelts, hay, and silage (e) When it has been determined that of a commodity as follows: derived from an eligible loan a violation of the terms and conditions * * * * * commodity is not eligible to be pledged of the note and security agreement has (c) * * * as collateral to obtain a marketing occurred as a result of unauthorized

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removal or disposition, CCC will (g) If the producer fails to pay such submit the prescribed form to the FSA determine the quantity of the amount within 30 days from the date of Service Center on or before beneficial commodity involved with respect to notification of violations as provided in interest is lost in such quantity. A such violation and require the paragraphs (e)(1) and (f)(1) of this producer may not obtain loan deficiency repayment of that portion of the section, the producer must immediately payment benefits, if the applicable form marketing assistance loan which is repay the marketing assistance loan at is not received in the FSA Service commensurate to such quantity of the the rate at which the loan was disbursed Center on or before beneficial interest is commodity. In the case of these plus interest, and any other charges lost in the requested commodity. violations, if CCC determines the assessed under the note and security (2) With respect to a request for a loan producer: agreement. deficiency payment for unshorn pelts, a (1) Acted in good faith when the (h) For violations subject to completed request for such a payment violation occurred, liquidated damages paragraphs (e)(2) and (f)(2) of this must be submitted on or before the shall be assessed according to paragraph section, the producer must immediately earlier of the date of slaughter of the (d) of this section and the commodity repay the marketing assistance loan at lamb or the loss of beneficial interest in involved in the violation must be the rate at which the loan was disbursed the lamb or the unshorn pelt produced redeemed at the lesser of: plus interest, and any other charges from the lamb. In addition, the lamb (i) The rate at which the loan was assessed under the note and security must have been owned for not less than disbursed, plus interest and any other agreement. If the loan has already been 30 days prior to the date such charges assessed under the note and repaid, any market gain previously application is filed with CCC and must security agreement; or realized on the loan, plus interest, must have been slaughtered for personal use, (ii) The alternative repayment rate in be refunded to CCC. or sold for slaughter and slaughtered effect on the date of the determination * * * * * within 10 calendar days after the sale. is issued by CCC that a violation has I occurred, plus 15 percent of the original 9. Amend § 1421.112 by revising * * * * * loan rate as provided on the note and paragraph (a)(3) to read as follows: I 11. Amend § 1421.201 by revising paragraph (b) to read as follows: security agreement. § 1421.112 Loan settlement. (2) Did not act in good faith when the (a) * * * § 1421.201 Loan deficiency payment rate. violation was committed, liquidated (3) If CCC sells the commodity * * * * * damages shall be assessed in accordance described in paragraph (a)(1) and with paragraph (d) of this section, and (b) The loan deficiency payment rate (a)(2)of this section in settlement of the will be: administrative actions shall be taken in marketing assistance loan, the sales accordance with paragraph (h) of this (1) For 2005 and preceding crop years, proceeds shall be applied to the amount for loan deficiency payment other than section. The loan must be redeemed at owed CCC by the producer. The the rate at which the loan was field direct loan deficiency payments, producer shall be responsible for any the rate in effect in the county where the disbursed, plus interest and any other costs incurred by CCC in completing the charges assessed under the note and commodity is stored as of the day the sale and CCC will deduct the amount of producer submits to the FSA county security agreement. these costs from the sales proceeds. If (f) When it has been determined that service center a completed request for CCC sells any commodity obtained by a violation of the terms and conditions payments; delivery or forfeiture under a non- of the note and security agreement has (2) For 2005 and preceding crop years, recourse marketing assistance loan, CCC occurred as result of an incorrect for field direct loan deficiency will, in all instances, retain all proceeds certification, CCC will determine the payments, the rate in effect for the obtained from the sale of the commodity quantity of the commodity involved county in which the farm is and will not make any payment of any with respect to such violation and administratively located for CCC amount of such proceeds to any party, require the repayment of that portion of program purposes as of the date the including the producer who had the marketing assistance loan which is commodity was delivered to a satisfied their obligation under the loan commensurate to such quantity of the processor, buyer warehouse, cooperative through forfeiture of the commodity to commodity. In the case of an incorrect marketing association, or similar entity. CCC. certification, if CCC determines the (3) For 2006 and subsequent crop producer: * * * * * years, the loan deficiency payment rate (1) Acted in good faith when the in effect in the county where the Subpart C—Loan Deficiency Payments violation occurred, liquidated damages commodity was marketed or stored on the date: shall be assessed according to paragraph I 10. Amend § 1421.200 by revising (i) The request for benefits is received (d) of this section, and the commodity paragraph (c) to read as follows: involved in the violation must be in the FSA Service Center, if the redeemed at the rate at which the loan § 1421.200 Applicability. producer retains beneficial interest in was disbursed, plus interest and any * * * * * the quantity on that date. other charges assessed under the note (c)(1) A producer must submit a (ii) Beneficial interest was lost, as and security agreement. completed request for a loan deficiency determined by CCC and as provided in (2) Did not act in good faith about the payment agreement and request form on §§ 1421.6 and 1421.13, if on the date the violation, liquidated damages shall be or before the date beneficial interest is request for benefits was received in the assessed in accordance with paragraph lost in the commodity and before the FSA Service Center the producer no (d) of this section and administrative final loan availability date for the longer has beneficial interest in the actions shall be taken in accordance commodity. Producers must, on a form requested quantity. with paragraph (h) of this section. The prescribed by CCC, indicate their * * * * * loan must be redeemed at the rate at intentions, in which the producer also I 12. Amend § 1421.203 by revising which the loan was disbursed, plus agrees to the terms and conditions of the paragraphs (a)(1), (b), and (c), deleting interest and any other charges assessed loan deficiency payment program, to paragraph (d), and renumbering under the note and security agreement. receive a loan deficiency payment and paragraphs (e) through (j) as paragraphs

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(d) through (i), respectively. Revised tendered to CCC for a marketing (4) Not have received any payment paragraph (a)(1), (b) and (c) read as assistance loan or loan deficiency from any party with respect to the follows: payment. For the purposes of this part, cotton; and the term ‘‘beneficial interest’’ refers to a (5) If the cotton has been physically § 1421.203 Personal liability of the determination by CCC that a person has delivered to a location other than a producer. the requisite title to and control of location owned or under the total (a) * * * cotton that is tendered to CCC as control of the producer, have delivered (1) When signing the Loan Deficiency collateral for a marketing assistance loan the cotton to a warehouse approved in Payment Agreement and Request, as or is the cotton that will be used to accordance with § 1427.10. Delivery of applicable, that the producer will not determine a loan deficiency payment. A the cotton to a location other than to provide an incorrect certification of the determination of whether a person has such an approved warehouse will result quantity or make any fraudulent beneficial interest in cotton is made by in the loss of beneficial interest in the representation, that CCC will rely upon CCC in accordance with this part and is cotton on the date of physical delivery in determining a loan deficiency not based upon a determination under and the producer will be considered to payment; and any State law or any other regulation of have lost beneficial interest as of 11:59 * * * * * a Federal agency. p.m. of such day regardless of any other (b) Liquidated damages assessed in (f) Except as provided in paragraph action or agreement between the entity accordance with this section will be (h) of this section, when requesting a where the cotton was delivered and the determined by multiplying the quantity marketing assistance loan, in order to producer, unless such an entity has involved in the violation by 10 percent have beneficial interest in the cotton been approved by CCC under § 1427.10. of the loan deficiency payment. tendered as collateral for the loan, a (h) Notwithstanding paragraphs (f) (c) If CCC determines that the person must: and (g) of this section, in order to producer: (1) Be the producer of the cotton as facilitate the handling of situations (1) Acted in good faith when the determined in accordance with § 1427.4; involving the death of a producer, CCC violation occurred, liquidated damages (2) Have had ownership of the cotton will consider an estate and a person to will be assessed in accordance with from the time it was planted through the whom title to cotton has passed by paragraph (b) of this section and the earlier the date the loan was repaid or virtue of State law upon the death of the producer must repay the loan deficiency the maturity date of the loan; producer to have beneficial interest in payment applicable to the loan (3) Have control of the cotton from the the cotton produced by the producer deficiency quantity involved in the time of planting through the maturity under the same terms and conditions violation and charges, plus interest date of the loan. To have control of the that would otherwise be applicable to applicable to the amount repaid. If the cotton, such person must have complete such producer; producer fails to pay such amount decision making authority regarding (i) Notwithstanding paragraphs (f) and within 30 days from the date of whether the cotton will be tendered as (g) of this section, a person who notification the producer must repay the collateral for a loan, when the loan will purchases or otherwise acquires cotton entire loan deficiency payment and be repaid or if the collateral will be from a producer under any charges plus interest. forfeited to CCC in satisfaction of the circumstances does not obtain beneficial (2) Did not act in good faith when the loan obligations of such person, and interest to the cotton whether such violation was committed, liquidated where the cotton will be maintained purchase or acquisition is made prior to damages will be assessed in accordance during the term of the loan; and the harvest of the crop or after harvest with paragraph (b) of this section and (4) Not have received any payment except in one instance. CCC will the producer shall repay the entire loan from any party with respect to the consider a person to have beneficial deficiency payment and charges plus cotton. interest in cotton if, prior to harvest, interest. (g) Except as provided in paragraph such person has obtained title to the (h) of this section, when requesting a growing cotton at the same time that * * * * * loan deficiency payment, in order to such person obtained full title to the PART 1427—COTTON have beneficial interest in the cotton a land on which such crop was growing; person must: (j) A producer will lose beneficial I 13. The authority citation for part (1) Be the producer of the cotton as interest in cotton if the producer 1427 continues to read as follows: determined in accordance with § 1427.4; receives any payment from any person (2) Have had ownership of the cotton under any contractual arrangement with Authority: 7 U.S.C. 7231–7237 and 7931– from the time it was planted through the 7939; and 15 U.S.C. 714b and 714c. respect to cotton if the person who is date the producer has elected to making the payment, or any person Subpart A—Nonrecourse Cotton Loan determine the loan deficiency payment otherwise associated with the person and Loan Deficiency Payments rate; and making the payment, will at any time (3) Have control of the cotton from the have title to the cotton or control of the I 14. Amend § 1427.5 by re-designating time of planting through the date the cotton prior to or after harvest unless: paragraphs (g) and (h) as paragraphs (m) producer has elected to determine the (1) Such payment is authorized in and (n), respectively; revising loan deficiency payment rate. To have accordance with part 1425 of this paragraphs (e) and (f), and adding new control of the cotton, such person must chapter; or paragraphs (g) through (l), to read as have complete decision making (2) The payment is made as follows: authority regarding whether a loan consideration for an option to purchase deficiency payment will be requested the cotton and such option contains the § 1427.5 General eligibility requirements. with respect to the cotton; when the following provision: * * * * * loan deficiency rate will be selected; Notwithstanding any other provision (e) To be eligible to receive marketing and where the cotton will be maintained of this option to purchase or any other assistance loans and loan deficiency prior to the date on which the loan contract, title and control of the cotton payments, a producer must have deficiency payment rate will be and beneficial interest in the cotton as beneficial interest in the cotton that is determined; specified in 7 CFR 1427.5 shall remain

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with the producer until the buyer (f) When it has been determined that DEPARTMENT OF TRANSPORTATION exercises this option to purchase the a violation of the terms and conditions cotton. This option to purchase shall of a loan deficiency application has Federal Aviation Administration expire, notwithstanding any action or occurred, CCC will determine the inaction by either the producer or the quantity of the cotton involved with 14 CFR Part 39 buyer, at the earlier of: respect to such violation and assess [Docket No. FAA–2005–22358; Directorate (1) The maturity of any Commodity liquidated damages by multiplying the Identifier 2005–NE–20–AD; Amendment 39– Credit Corporation (CCC) loan that is quantity of cotton involved in the 14632; AD 2006–12–07] secured by such cotton; violation by 10 percent of the marketing (2) The date CCC claims title to such RIN 2120–AA64 assistance loan rate. cotton; or (3) Such other date as provided in this * * * * * Airworthiness Directives; Engine Components Inc. (ECi) Reciprocating option. I 16. Amend § 1427.21 by adding a new (k) Absent other provisions causing Engine Cylinder Assemblies paragraph (e) to read as follows: the producer to lose beneficial interest AGENCY: Federal Aviation in the cotton, inclusion in a contract of § 1427.21 Settlement. Administration (FAA), Department of a provision that allows the producer to * * * * * Transportation (DOT). select the sales price of the cotton at the ACTION: Final rule. time the contract is entered into or at a (e) If CCC sells the commodity later date, a contract normally referred described in paragraph (a) of this SUMMARY: The FAA is superseding an to as a deferred price contract or a price section in settlement of the recourse existing airworthiness directive (AD) for later contract, will not result in the loss loan, the sales proceeds shall be applied Lycoming Engines (formerly Textron of beneficial interest in the cotton. to the amount owed CCC by the Lycoming) models 320, 360, and 540 (l) Commodities produced under a producer. The producer shall be series, ‘‘Parallel Valve’’ reciprocating contract in which the title to the seed responsible for any costs incurred by engines, with certain Engine remains with the entity providing the CCC in completing the sale and CCC Components Inc. (ECi) cylinder seed to the producer, including will deduct the amount of these costs assemblies, part number (P/N) contracts for the production of hybrid from the sales proceeds. When CCC sells AEL65102 series ‘‘Classic Cast’’, seed, genetically modified commodities any cotton obtained by forfeiture under installed. That AD currently requires and other specialty seeds as approved in a marketing assistance loan, CCC will, replacing these ECi cylinder assemblies. writing by CCC, are eligible to be in all instances, retain all proceeds This AD requires the same actions, but pledged as collateral for a marketing obtained from the sale of the cotton and replaces the ‘‘Engine Models’’ Table 1 assistance loan and a loan deficiency will not make any payment of any and ‘‘Engines Installed On, But Not payment may be made with respect to amount of such proceeds to any party, Limited To’’ Table 2 with corrected such production if at the time of the including the producer who had tables. Also, this AD corrects the casting request for such a loan or payment the satisfied their obligation under the loan part number. This AD results from producer has not: through forfeiture of the cotton to CCC. reports of applicability errors found in (1) Received a payment under the AD 2005–26–10. We are issuing this AD I contract; or 17. Amend § 1427.23 by revising to prevent loss of engine power due to (2) Delivered the commodity to paragraph (a)(3) to read as follows: cracks in the cylinder assemblies and another person. § 1427.23 Cotton loan deficiency possible engine failure caused by * * * * * payments. separation of a cylinder head. I 15. Amend § 1427.18 by revising DATES: This AD becomes effective July paragraphs (e) and (f) to read as follows: (a) * * * 11, 2006. § 1427.18 Liability of the producer. (3) A producer must submit a ADDRESSES: You may examine the AD completed request for a loan deficiency * * * * * docket on the Internet at http:// (e) The producer and CCC agree that payment for a quantity of eligible cotton dms.dot.gov or in Room PL–401 on the it will be difficult, if not impossible, to under § 1427.5(a) on or before the date plaza level of the Nassif Building, 400 prove the amount of damages to CCC if beneficial interest is lost in the Seventh Street, SW., Washington, DC. a producer makes any fraudulent commodity and before the final loan FOR FURTHER INFORMATION CONTACT: representation in obtaining a loan or availability date for the commodity. Peter Hakala, Aerospace Engineer, loan deficiency payment or in Producers must, on a form prescribed by Special Certification Office, FAA, maintaining or settling a loan or CCC, indicate their intentions to receive Rotorcraft Directorate, 2601 Meacham disposing of or moving the loan a loan deficiency payment and submit Blvd., Fort Worth, TX 76193; telephone collateral without the prior written the prescribe form to the FSA Service (817) 222–5145; fax (817) 222–5785. approval of CCC. Accordingly, if CCC Center on or before beneficial interest is SUPPLEMENTARY INFORMATION: The FAA determines that the producer has lost in such quantity. A producer may proposed to amend 14 CFR part 39 with violated the terms or conditions of their not file such a form after beneficial a proposed AD. The proposed AD requests for a loan or any applicable interest is lost. applies to Lycoming Engines models form required by CCC, liquidated * * * * * 320, 360, and 540 series, ‘‘Parallel damages shall be assessed on the Valve’’ reciprocating engines, with Signed in Washington, DC, on May 10, quantity involved in the violation. certain ECi cylinder assemblies, P/N 2006. Liquidated damages assessed in AEL65102 series ‘‘Classic Cast’’, accordance with this section will be Teresa C. Lasseter, installed. We published the proposed determined by multiplying the quantity Executive Vice President, Commodity Credit AD in the Federal Register on February involved in the violation by 10 percent Corporation. 24, 2006 (71 FR 9480). That action of the marketing assistance loan rate [FR Doc. 06–5078 Filed 6–5–06; 8:45 am] proposed to require the same actions as applicable to the loan note. BILLING CODE 3410–05–P AD 2005–26–10, but would replace the

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‘‘Engine Models’’ Table 1 and ‘‘Engines Costs of Compliance (2) Is not a ‘‘significant rule’’ under Installed On, But Not Limited To’’ Table DOT Regulatory Policies and Procedures We estimate that 7,557 ECi cylinder 2 with corrected tables. Also, that action (44 FR 11034, February 26, 1979); and assemblies are installed on Lycoming proposed to correct the casting part (3) Will not have a significant engines in the United States. We number. economic impact, positive or negative, estimate that it will take about two on a substantial number of small entities Examining the AD Docket workhours per engine to perform the under the criteria of the Regulatory aircraft inspections of the cylinder Flexibility Act. You may examine the docket that assemblies for applicability, and that the We prepared a summary of the costs contains the AD, any comments average labor rate is $65 per workhour. to comply with this AD and placed it in received, and any final disposition in From the Lycoming Engines ‘‘Removal the AD Docket. You may get a copy of person at the Docket Management and Installation Labor Allowance this summary at the address listed Facility Docket Office between 9 a.m. Guidebook’’, dated May 2000, the under ADDRESSES. and 5 p.m., Monday through Friday, complete cylinder replacement for a except Federal holidays. The Docket four cylinder engine takes 12 hours, List of Subjects in 14 CFR Part 39 Office (telephone (800) 647–5227) is while the complete cylinder located on the plaza level of the Air transportation, Aircraft, Aviation replacement for a six cylinder engine safety, Safety. Department of Transportation Nassif takes 16 hours. Required parts will cost Building at the street address stated in about $1,000 per cylinder assembly. Adoption of the Amendment ADDRESSES. Comments will be available Based on these figures, we estimate that I Accordingly, under the authority in the AD docket shortly after the DMS the total cost of the AD to U.S. operators delegated to me by the Administrator, receives them. to be $9,152,140. ECi indicated that they the Federal Aviation Administration might give operators and repair stations Comments amends 14 CFR part 39 as follows: credit for returned cylinder assemblies We provided the public the toward the purchase of new ECi PART 39—AIRWORTHINESS opportunity to participate in the cylinder assemblies. DIRECTIVES development of this AD. We have considered the comments received. Authority for This Rulemaking I 1. The authority citation for part 39 Request To Change All References to Title 49 of the United States Code continues to read as follows: Casting P/N AEL65099 specifies the FAA’s authority to issue Authority: 49 U.S.C. 106(g), 40113, 44701. rules on aviation safety. Subtitle I, One commenter requests that we section 106, describes the authority of § 39.13 [Amended] change all references to casting P/N the FAA Administrator. Subtitle VII, I 2. The FAA amends § 39.13 by AEL65099 to read ‘‘casting head Aviation Programs, describes in more removing Amendment 39–14431 (70 FR markings EC 65099–REV–1’’ to more detail the scope of the Agency’s 76385, December 27, 2005), and by accurately describe the actual markings. authority. adding a new airworthiness directive, We agree, and made the reference We are issuing this rulemaking under Amendment 39–14632, to read as changes in the AD. the authority described in subtitle VII, follows: part A, subpart III, section 44701, Request To Explain Another Set of 2006–12–07 Engine Components Numbers on the Cylinder ‘‘General requirements.’’ Under that Incorporated (ECi): Amendment 39– section, Congress charges the FAA with 14632. Docket No. FAA–2005–22358; The same commenter requests that we promoting safe flight of civil aircraft in Directorate Identifier 2005–NE–20–AD. explain that the set of numbers air commerce by prescribing regulations appearing on the cylinder below and to for practices, methods, and procedures Effective Date the left of the SN, in the form of the Administrator finds necessary for (a) This airworthiness directive (AD) ‘‘12345–67’’ is not used for determining safety in air commerce. This regulation becomes effective July 11, 2006. applicability. We agree, and have added is within the scope of that authority Affected ADs a statement to point this out in the AD. because it addresses an unsafe condition (b) This AD supersedes 2005–26–10, Update to Related Information that is likely to exist or develop on Amendment 39–14431. products identified in this rulemaking Applicability Under paragraph (k), Related action. Information, we updated the reference (c) This AD applies to Lycoming Engines Regulatory Findings to ECi Service Bulletin No. 05–08, (formerly Textron Lycoming) models 320, We have determined that this AD will 360, and 540 series, parallel valve, Revision 1, dated December 29, 2005, to reciprocating engines: Revision 2, dated February 28, 2006. not have federalism implications under (1) Specified in Table 1 of this AD; and Executive Order 13132. This AD will Conclusion (2) With ECi cylinder assemblies, part not have a substantial direct effect on number (P/N) AEL65102 series ‘‘Classic We have carefully reviewed the the States, on the relationship between Cast’’, having casting head markings EC available data, including the comments the national government and the States, 65099–REV–1; and received, and determined that air safety or on the distribution of power and (3) With serial numbers (SNs) 1 through and the public interest require adopting responsibilities among the various 9879 (SN may have an ‘‘L’’ prefix for a long levels of government. reach spark plug), (sold from January 1997 to the AD with the changes described September 2001) installed. previously. We have determined that For the reasons discussed above, I (4) The set of numbers appearing on the these changes will neither increase the certify that this AD: cylinder, below and to the left of the SN, in economic burden on any operator nor (1) Is not a ‘‘significant regulatory the form of ‘‘12345–67’’ is not used for increase the scope of the AD. action’’ under Executive Order 12866; determining applicability.

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TABLE 1.—ENGINE MODELS

Cylinder head part No. Installed on engine models

AEL65102–NST04 ...... O–320–A1B, A2B, A2C, A2D, A3A, A3B, B2B, B2C, B2D, B2E, B3B, B3C, C2B, C2C, C3B, C3C, D1A, D1AD, D1B, D1C, D1D, D1F, D2A, D2B, D2C, D2F, D2G, D2H, D2J, D3G, E1A, E1B, E1C, E1F, E1J, E2A, E2B, E2C, E2D, E2E, E2F, E2G, E2H, E3D, E3H. IO–320–A1A, A2A, B1A, B1B, B1C, B1D, B1E, B2A, D1A, D1AD, D1B, D1C, E1A, E1B, E2A, E2B. AEIO–320–D1B, D2B, E1A, E1B, E2A, E2B. AIO–320–A1A, A1B, A2A, A2B, B1B, C1B. LIO–320–B1A. AEL65102–NST05 ...... IO–320–C1A, C1B, C1F, F1A. LIO–320–C1A. AEL65102–NST06 ...... O–320–A1A, A2A, A2B, A2C, A3A, A3B, A3C, E1A, E1B, E2A, E2C, (also, an O–320 model with no suffix). IO–320–A1A, A2A. AEL65102–NST07 ...... IO–320–B1A, B1B. LIO–320–B1A. AEL65102–NST08 ...... O–320–B1A, B1B, B2A, B2B, B3A, B3B, B3C, C1A, C1B, C2A, C2B, C3A, C3B, C3C, D1A, D1B, D2A, D2B, D2C. AEL65102–NST10 ...... O–360–A1A, A1C, A1D, A2A, A2E, A3A, A3D, A4A, B1A, B1B, B2A, B2B, C1A, C1C, C1G, C2A, C2B, C2C, C2D, D1A, D2A, D2B. IO–360–B1A, B1B, B1C. HO–360–A1A, B1A, B1B. HIO–360–B1A, B1B. AEIO–360–B1B. O–540–A1A, A1A5, A1B5, A1C5, A1D, A1D5, A2B, A3D5, A4A5, A4B5, A4C5, A4D5, B1A5, B1B5, B1D5, B2A5, B2B5, B2C5, B2C5D, B4A5, B4B5, B4B5D, D1A5, E1A, E4A5, E4B5, E4C5, F1A5, F1B5, G1A5, G2A5. IO–540–C1B5, C1C5, C2C, C4B5, C4B5D, C4C5, D4A5, D4B5, N1A5, N1A5D. AEL65102–NST12 ...... O–360–A1A, A1AD, A1D, A1F, A1F6, A1F6D, A1G, A1G6, A1G6D, A1H, A1H6, A1J, A1LD, A1P, A2A, A2D, A2F, A2G, A2H, A3A, A3AD, A3D, A4A, A4AD, A4D, A4G, A4J, A4JD, A4K, A4M, A4N, A4P, A5AD, B1A, B2C, C1A, C1C, C1E, C1F, C1G, C2A, C2B, C2C, C2D, C2E, C4F, C4P, D2A, F1A6, G1A6. HO–360–C1A. LO–360–A1G6D, A1H6. HIO–360–B1A, B1B, G1A. LTO–360–A1A6D. TO–360–A1A6D. IO–360–B1B, B1BD, B1D, B1E, B1F, B1F6, B1G6, B2E, B2F, B2F6, B4A, E1A, L2A, M1A, M1B. AEIO–360–B1B, B1D, B1E, B1F, B1F6, B1G6, B1H, B2F, B2F6, B4A, H1A, H1B. O–540–A4D5, B2B5, B2C5, B2C5D, B4B5, B4B5D, E4A5, E4B5, E4B5D, E4C5, G1A5, G1A5D, G2A5, H1A5, H1A5D, H1B5, H1B5D, H2A5, H2A5D, H2B5D. IO–540–C4B5, C4B5D, C4D5, C4D5D, D4A5, D4B5, D4C5, N1A5, N1A5D, T4A5D, T4B5, T4B5D, T4C5D, V4A5, V4A5D. AEIO–540–D4A5, D4B5, D4C5, D4D5. AEL65102–NST26 ...... IO–540–J4A5, R1A5. TIO–540–C1A, E1A, G1A, H1A. AEL65102–NST38 ...... IO–360–F1A. TIO–540–AA1AD, AB1AD, AB1BD, AF1A, AG1A, AK1A, C1A, C1AD, K1AD. LTIO–540–K1AD. AEL65102–NST43 ...... O–360–J2A. O–540–F1B5, J1A5D, J1B5D, J1C5D, J1D5D, J2A5D, J2B5D, J2C5D, J2D5D, J3A5, J3A5D, J3C5D. IO–540–AB1A5, W1A5, W1A5D, W3A5D. AEL65102–NST44 ...... O–540–L3C5D.

For information, the subject engines are installed on, but not limited to, the aircraft listed in the following Table 2:

TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO

O–320–A1A ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘150’’, PA–22S ‘‘150’’), Apache (PA–23), Pawnee (PA–25). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). Mooney Aircraft: Mark (20A). Dinfia: Ranquel (1A–46). Simmering-Graz Pauker: Flamingo (SGP–M–222). Aviamilano: Scricciolo (P–19). Vos Helicopter Co.: Spring Bok. O–320–A1B ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘150’’, PA–22S ‘‘150’’), Apache (PA–23). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). S.O.C.A.T.A.: Horizon (Gardan).

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TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO—Continued O–320–A2A ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘150’’, PA–22S ‘‘150’’), Agriculture (PA–18A ‘‘150’’) Super Cub (PA–18 ‘‘150’’), Caribbean (PA–22 ‘‘150’’), Pawnee (PA–25). Intermountain Mfg. Co.: Call Air Texas (A–5, A–5T). Lake Aircraft: Colonial (C–1). Rawdon Bros.: Rawdon (T–1, T–15, T–15D). Shinn Engineering: Shinn (2150–A). Dinfia: Ranquel (1A–46). Neiva: (1PD–5802). Sud: Gardan-Horizon (GY–80). LaVerda: Falco (F8L Series II, America). Malmo: Vipan (MF1–10). Kingsford Smith: Autocrat (SCRM–153). Aero Commander: 100. O–320–A2B ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘150’’, PA–22S ‘‘150’’), Cherokee (PA–28 ‘‘150’’), Super Cub (PA–18 ‘‘150’’). Champion Aircraft: Challenger (7GCA, 7GCB, 7KC), Citabria (7GCAA, 7GCRC), Agriculture (7GCBA). Beagle: Pup (150). Artic: Interstate S1B2. Robinson: R–22. Varga: Kachina 2150A. O–320–A2C ...... Robinson: R–22. Cicare: Cicare AG. Bellanca Aircraft: Citabria 150 (7GCAA), Citabria 150S (7GCBC). O–320–A2D ...... Piper Aircraft: Apache (PA–23). O–320–A3A ...... Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). Corben-Fettes: Globe Special (Globe GC–1B). O–320–A3B ...... Piper Aircraft: Apache (PA–23). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). Teal II: TSC (1A2). O–320–B1A ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). Malmo: Vipan (MF1–10). O–320–B1B ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B) O–320–B2A ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘160’’, PA–22S ‘‘160’’). O–320–B2B ...... Piper Aircraft: Tri-Pacer (PA–22 ‘‘160’’, PA–22S ‘‘160’’). Beagle: Airedale (D5–160). Fuji-Heavy Industries: Fuji (F–200). Uirapuru: Aerotec 122. O–320–B2C ...... Robinson: R–22. O–320–B2D ...... Maule: MX–7–160. O–320–B2E ...... Lycon. O–320–B3A ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). O–320–B3B ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). Doyn Aircraft: Doyn-Cessna (170, 170A, 170B). Sud: Gardan (GY80–160). O–320–C1A ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). Riley Aircraft: Rayjay (Apache). O–320–C1B ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). O–320–C3A ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). O–320–C3B ...... Piper Aircraft: Apache (PA–23 ‘‘160’’). O–320–D1A ...... Sud: Gardan (GY–80). Gyroflug: Speed Cancard. Grob: G115. O–320–D1F ...... Slingsby: T67 Firefly. O–320–D2A ...... Piper Aircraft: Cherokee (PA–28S ‘‘160’’). Robin: Major (DR400–140B), Chevalier (DR–360), (R–3140). S.O.C.A.T.A.: Tampico TB9. Slingsby: T67C Firefly. Daetwyler: MD–3–160. Nash Aircraft Ltd.: Petrel. Aviolight: P66D Delta. General Avia: Pinguino. O–320–D2B ...... Beech Aircraft: Musketeer (M–23). Piper Aircraft: Cherokee (PA–28 ‘‘160’’). O–320–D2J ...... Cessna Aircraft: Skyhawk 172. O–320–D3G ...... Piper Aircraft: Warrior II, Cadet (PA–28–161). O–320–E1A ...... Grob: G115. O–320–E1C ...... M.B.B. (Messerschmitt-Boelkow-Blohm): Monsun (BO–209–B). O–320–E1F ...... M.B.B.: Monsun (BO–209–B). O–320–E2A ...... Piper Aircraft: Cherokee (PA–28 ‘‘140’’, PA–28 ‘‘150’’). Robin: Major (DR–340), Sitar, Bagheera (GY–100–135). S.O.C.A.T.A.: Super Rallye (MS–886), Rallye Commodore (MS–892). Siai-Marchetti: (S–202).

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TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO—Continued F.F.A.: Bravo (AS–202/15). Partenavia: Oscar (P66B), Bucker (131 APM). Aeromot: Paulistina P–56. Pezetel: Koliber 150. O–320–E2C ...... Beech Aircraft: Musketeer III (M–23III). M.B.B.: Monsun (BO–209–B). O–320–E2D ...... Cessna Aircraft: Cardinal (172–I, 177). O–320–E2F ...... M.B.B.: Monsun (BO–209–B), Wassmer Pacific (WA–51). O–320–E2G ...... American Aviation Corp.: Traveler. O–320–E3D ...... Piper Aircraft: Cherokee (140). Beech Aircraft: Sport. IO–320–B2A ...... Piper Aircraft: Twin Comanche (PA–30). IO–320–B1C ...... Hi. Shear: Wing. IO–320–B1D ...... Ted Smith Aircraft: Aerostar. IO–320–C1A ...... Piper Aircraft: Twin Comanche (PA–30 Turbo). IO–320–D1A ...... M.B.B.: Monsun (BO–209–C). IO–320–D1B ...... M.B.B.: Monsun (BO–209–C). IO–320–E1A ...... M.B.B.: Monsun (BO–209–C). IO–320–E1B ...... Bellanca Aircraft. IO–320–E2A ...... Champion Aircraft: Citabria. IO–320–E2B ...... Bellanca Aircraft. IO–320–F1A ...... CAAR Engineering: Carr Midget. LIO–320–B1A ...... Piper Aircraft: Twin Comanche (PA–39). LIO–320–C1A ...... Piper Aircraft: Twin Comanche (PA–39). AIO–320–B1B ...... M.B.B.: Monsun (BO–209–C). AEIO–320–D1B ...... Slingsby: T67M Firefly. AEIO–320–D2B ...... Hundustan Aeronautics Ltd.: HT–2. AEIO–320–E1A ...... Bellanca Aircraft. Champion Aircraft. AEIO–320–E1B ...... Bellanca Aircraft. Champion Aircraft: Decathalon (8KCAB–CS). AEIO–320–E2B ...... Bellanca Aircraft. Champion Aircraft: Decathalon (8KCAB). O–320–A1A ...... Riley Aircraft: Riley Twin. O–360–A1A ...... Beech Aircraft: Travel Air (95, B–95). Piper Aircraft: Comanche (PA–24). Intermountain Mfg. Co.: Call Air (A–6). Lake Aircraft: Colonial (C–2, LA–4, 4A or 4P). Doyn Aircraft: Doyn-Cessna (170B, 172, 172A, 172B). Mooney Aircraft: Mark ‘‘20B’’ (M–20B). Earl Horton: Pawnee (Piper PA–25). Dinfia: Ranquel (1A–51). Neiva: (1PD–5901). Regente: (N–591). Wassmer: Super 4 (WA–50A), Sancy (WA–40), Baladou (WA–40), Pariou (WA–40). Sud: Gardan (GY–180). Bolkow: (207). Partenavia: Oscar (P–66). Siai-Marchetti: (S–205). Procaer: Picchio (F–15–A). S.A.A.B.: Safir (91–D). Malmo: Vipan (MF–10B). Aero Boero: AB–180. Beagle: Airedale (A–109). DeHavilland: Drover (DHA–3MK3). Kingsford-Smith: Bushmaster (J5–6). Aero Engine Service Ltd.: Victa (R–2). O–360–A1AD ...... S.O.C.A.T.A.: Tabago TB–10. O–360–A1D ...... Piper Aircraft: Comanche (PA–24). Lake Aircraft: Colonial (LA–4, 4A or 4P). Doyn Aircraft: Doyn-Beech (Beech 95). Mooney Aircraft: Master ‘‘21’’ (M–20E), Mark ‘‘20B’’, ‘‘20D’’, (M20B, M20C), Mooney Statesman (M–20G). Dinfia: Querandi (1A–45). Wassmer: (WA–50). Malmo: Vipan (MF1–10). Cessna Aircraft: Skyhawk. Doyn Aircraft: Doyn-Piper (PA–23 ‘‘160’’). O–360–A1F6 ...... Cessna Aircraft: Cardinal. O–360–A1F6D ...... Cessna Aircraft: Cardinal 177. Teal III: TSC (1A3). O–360–A1G6 ...... Aero Commander. O–360–A1G6D ...... Beech Aircraft: Duchess 76. O–360–A1H6 ...... Piper Aircraft: Seminole (PA–44). O–360–A1LD ...... Wassmer: Europa WA–52.

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TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO—Continued O–360–A1P ...... Aviat: Husky. O–360–A2A ...... Center Est Aeronautique: Regente (DR–253). S.O.C.A.T.A.: Rallye Commodore (MS–893). Societe Aeronautique Normande: Mousquetaire (D–140). Bolkow: Klemm (K1–107C). Partenavia: Oscar (P–66). Beagle: Husky (D5–180) (J1–U). O–360–A2D ...... Piper Aircraft: Comanche (PA–24), Cherokee ‘‘C’’ (PA–28 ‘‘180’’). Mooney Aircraft: Master ‘‘21’’ (M–20D), Mark ‘‘21’’ (M–20E). O–360–A2E ...... Std. Helicopter. O–360–A2F ...... Aero Commander: Lark (100). Cessna Aircraft: Cardinal. O–360–A2G ...... Beech Aircraft: Sport. O–360–A3A ...... C.A.A.R.P.S.A.N.: (M–23III). Societe Aeronautique Normande: Jodel (D–140C). Robin: Regent (DR400/180), Remorqueur (DR400/180R). R–3170. S.O.C.A.T.A.: Rallye 180GT, Sportavia Sportsman (RS–180). Norman Aeroplace Co.: NAC–1 Freelance. Nash Aircraft Ltd.: Petrel. O–360–A3AD ...... S.O.C.A.T.A.: TB–10. Robin: Aiglon (R–1180T). O–360–A4A ...... Piper Aircraft: Cherokee ‘‘D’’ (PA–28 ‘‘180’’). O–360–A4D ...... Varga: Kachina. O–360–A4G ...... Beech Aircraft: Musketeer Custom III. O–360–A4K ...... Grumman American: Tiger. Beech Aircraft: Sundowner 180. O–360–A4M ...... Piper Aircraft: Archer II (PA–28 ‘‘18’’). Valmet: PIK–23. O–360–A4N ...... Cessna Aircraft: 172 (Optional). O–360–A4P ...... Penn Yan: Super Cub Conversion. O–360–A5AD ...... C. Itoh and Co.: Fuji FA–200. O–360–B2C ...... Seabird Aviation: SB7L. O–360–C1A ...... Intermountain Mfg. Co.: Call Air (A–6). O–360–C1E ...... Bellanca Aircraft: Scout (8GCBC–CS). O–360–C1F ...... Maule: Star Rocket MX–7–180. O–360–C1G ...... Christen: Husky (A–1). O–360–C2B ...... Hughes Tool Co.: (269A). O–360–C2D ...... Hughes Tool Co.: (269A). O–360–C2E ...... Hughes Tool Co.: (YHO–2HU) Military. Bellanca Aircraft: Scout (8GCBC FP). O–360–C4F ...... Maule: MX–7–180A. O–360–C4P ...... Penn Yan: Super Cub Conversion. O–360–F1A6 ...... Cessna Aircraft: Cutlass RG. O–360–J2A ...... Robinson: R22. IO–360–B1A ...... Beech Aircraft: Travel-Air (B–95A). Doyn Aircraft: Doyn-Piper (PA–23 ‘‘200’’). IO–360–B1B ...... Beech Aircraft: Travel-Air (B–95B). Doyn Aircraft: Doyn-Piper (PA–23 ‘‘200’’). Fuji: (FA–200). IO–360–B1D ...... United Consultants: See-Bee. IO–360–B1E ...... Piper Aircraft: Arrow (PA–28 ‘‘180R’’). IO–360–B1F ...... Utva: 75. IO–360–B2E ...... C.A.A.R.P. C.A.P. (10). IO–360–B1F6 ...... Great Lakes: Trainer. IO–360–B1G6 ...... American Blimp: Spector 42. IO–360–B2F6 ...... Great Lakes: Trainer. LO–360–A1G6D ...... Beech Aircraft: Duchess. LO–360–A1H6 ...... Piper Aircraft: Seminole (PA–44). IO–360–E1A ...... T.R. Smith Aircraft: Aerostar. IO–360–L2A ...... Cessna Aircraft: Skyhawk C–172. IO–360–M1A ...... Diamond Aircraft: DA–40. IO–360–M1B ...... Vans Aircraft: RV6, RV7, RV8 Lancair: 360. AEIO–360–B1F ...... F.F.A.: Bravo (200). Grob: G115/Sport-Acro. AEIO–360–B1G6 ...... Great Lakes. AEIO–360–B2F ...... Mundry: CAP–10. AEIO–360–B4A ...... Pitts: S–1S. AEIO–360–H1A ...... Bellanca Aircraft: Super Decathalon (8KCAB–180). AEIO–360–H1B ...... American Champion: Super Decathalon. VO–360–A1A ...... Brantly Hynes Helicopter: (B–2). VO–360–A1B ...... Brantly Hynes Helicopter: (B–2, B2–A). Military (YHO–3BR). VO–360–B1A ...... Brantly Hynes Helicopter: (B–2, B2–A). IVO–360–A1A ...... Brantly Hynes Helicopter: (B2–B).

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TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO—Continued HO–360–B1A ...... Hughes Tool Co.: (269A). HO–360–B1B ...... Hughes Tool Co.: (269A). HO–360–C1A ...... Schweizer: (300C). HIO–360–B1A ...... Hughes Tool Co.: Military (269–A–1) (TH–55A). HIO–360–B1B ...... Hughes Tool Co.: (269A). HIO–360–G1A ...... Schweizer: (CB). O–540–A1A ...... Rhein-Flugzeugbau: (RF–1). O–540–A1A5 ...... Piper Aircraft: Comanche (PA–24 ‘‘180’’). Helio: Military (H–250). Yoeman Aviation: (YA–1). O–540–A1B5 ...... Piper Aircraft: Aztec (PA–23 ‘‘250’’), Comanche (PA–24 ‘‘250’’). O–540–A1C5 ...... Piper Aircraft: Comanche (PA–24 ‘‘250’’). O–540–A1D ...... Found Bros.: (FBA–2C). Dornier: (DO–28–B1). O–540–A1D5 ...... Piper Aircraft: Aztec (PA–23 ‘‘250’’), Comanche (PA–24 ‘‘250’’), Military Aztec (U–11A). Dornier: (DO–28). O–540–A2B ...... Aero Commander: (500). Mid-States Mfg. Co.: Twin Courier (H–500), (U–5). O–540–A3D5 ...... Piper Aircraft: Navy Aztec (PA–23 ‘‘250’’). O–540–B1A5 ...... Piper Aircraft: Apache (PA–23 ‘‘235’’). O–540–B1B5 ...... Piper Aircraft: Comanche (PA–24 ‘‘250’’). Doyn Aircraft: Doyn-Piper (PA–24 ‘‘250’’). O–540–B1D5 ...... Wassmer: (WA–421). O–540–B2B5 ...... Piper Aircraft: Pawnee (PA–25 ‘‘235’’), Cherokee (PA –28 ‘‘235’’), Aztec (PA–23 ‘‘235’’). Intermountain Mfg. Co.: Call Air (A–9). Rawdon Bros.: Rawdon (T–1). S.O.C.A.T.A.: Rallye 235CA. O–540–B2C5 ...... Piper Aircraft: Pawnee (PA–25 ‘‘235’’). O–540–B4B5 ...... Piper Aircraft: Cherokee (PA–28 ‘‘235’’). Embraer: Corioca (EMB–710). S.O.C.A.T.A.: Rallye 235GT, Rallye 235C Maule: Star Rocket (MX–7–235), Super Rocket (M–6–235), Super Std. Rocket (M–7–235). O–540–E4A5 ...... Piper Aircraft: Comanche (PA–24 ‘‘260’’). Aviamilano: Flamingo (F–250). Siai-Marchetti: (SF–260), (SF–208). O–540–E4B5 ...... Britten-Norman: (BN–2). Piper Aircraft: Cherokee Six (PA–32 ‘‘260’’). O–540–E4C5 ...... Pilatus Britten-Norman: Islander (BN–2A–26), Islander (BN–2A–27), Islander II (BN–2B–26), Islander (BN–2A– 21),Trislander (BN–2A–Mark III–2). O–540–F1B5 ...... Omega Aircraft: (BS–12D1). Robinson: (R–44). O–540–G1A5 ...... Piper Aircraft: Pawnee (PA–25 ‘‘260’’). O–540–H1B5D ...... Aero Boero: 260. O–540–H2A5 ...... Embraer: Impanema ‘‘AG’’. Gippsland: GA–200. O–540–H2B5D ...... Aero Boero: 260. O–540–J1A5D ...... Maule: Star Rocket (MX–7–235), Super Rocket (M–6–235), Super Std. Rocket (M–7–235). O–540–J3A5 ...... Robin: R–3000/235. O–540–J3A5D ...... Piper Aircraft: Dakota (PA–28–236). O–540–J3C5D ...... Cessna Aircraft: Skylane RG. O–540–L3C5D ...... Cessna Aircraft: TR–182, Turbo Skylane RG. O–540–C1B5 ...... Piper Aircraft: Aztec B (PA–23 ‘‘250’’), Comanche (PA–24 ‘‘250’’). IO–540–C1C5 ...... Riley Aircraft: Turbo-Rocket. IO–540–C4B5 ...... Piper Aircraft: Aztec C (PA–23 ‘‘250’’), Aztec F. Wassmer: (WA–421). Avions Pierre Robin: (HR100/250). Bellanca Aircraft: Aries T–250. Aerofab: Renegade 250. IO–540–C4D5 ...... S.O.C.A.T.A.: TB–20. IO–540–C4D5D ...... S.O.C.A.T.A.: Trinidad TB–20. IO–540–D4A5 ...... Piper Aircraft: Comanche (PA–24 ‘‘260’’). Siai-Marchetti: (SF–260). IO–540–D4B5 ...... Cerva: (CE–43 Guepard). IO–540–J4A5 ...... Piper Aircraft: Aztec (PA–23 ‘‘250’’). IO–540–R1A5 ...... Piper Aircraft: Comanche (PA–24). IO–540–T4A5D ...... General Aviation: Model 114. IO–540–T4B5 ...... Commander: 114B. IO–540–T4B5D ...... Rockwell: 114. IO–540–T4C5D ...... Lake Aircraft: Seawolf. IO–540–V4A5 ...... Maule: MT–7–260, M–7–260. Aircraft Manufacturing Factory. IO–540–V4A5D ...... Brooklands: Scoutmaster. IO–540–W1A5 ...... Maule: MX–7–235, MT–7–235, M7–235. IO–540–W1A5D ...... Maule: Star Rocket (MX–7–235), Super Rocket (M–6–235), Super Std. Rocket (M–7–235).

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TABLE 2.—ENGINES INSTALLED ON, BUT NOT LIMITED TO—Continued IO–540–W3A5D ...... Schweizer: Power Glider. AEIO–540–D4A5 ...... Christen: Pitts (S–2S), (S–2B). Siai-Marchetti: SF–260. H.A.L.: HPT–32. Slingsby: Firefly T3A. AEIO–540–D4B5 ...... Moravan: Zlin-50L. H.A.L.: HPT–32. AEIO–540–D4D5 ...... Burkhart Grob: Grob G, 115T Aero. TIO–540–C1A ...... Piper Aircraft: Turbo Aztec (PA–23–250). TIO–540–K1AD ...... Piper Aircraft. TIO–540–AA1AD ...... Aerofab Inc.: Turbo Renegade (270). TIO–540–AB1AD ...... S.O.C.A.T.A.: Trinidad TC TB–21. TIO–540–AB1BD ...... Schweizer. TIO–540–AF1A ...... Mooney Aircraft: ‘‘TLS’’ M20M. TIO–540–AG1A ...... Commander Aircraft: 114TC. TIO–540–AK1A ...... Cessna Aircraft: Turbo Skylane T182T. LTIO–540–K1AD ...... Piper Aircraft.

Unsafe Condition of this AD, replace the cylinder assembly DEPARTMENT OF TRANSPORTATION (d) This AD results from reports of within 60 operating HIS after the effective applicability errors found in AD 2005–26–10. date of this AD. Federal Aviation Administration We are issuing this AD to prevent loss of Definition of a Replacement Cylinder engine power due to cracks in the cylinder Assembly 14 CFR Part 39 assemblies and possible engine failure caused by separation of a cylinder head. (h) For the purpose of this AD, a replacement cylinder assembly is defined as [Docket No. FAA–2006–24966; Directorate Compliance follows: Identifier 2006–NM–049–AD; Amendment (e) You are responsible for having the (1) A serviceable cylinder assembly made 39–14629; AD 2006–12–04] actions required by this AD performed within by Lycoming Engines. the compliance times specified unless the (2) A serviceable FAA-approved, Parts RIN 2120–AA64 actions have already been done. Manufacturer Approval cylinder assembly Engines Not Overhauled or Repaired Since from another manufacturer. Airworthiness Directives; Viking Air New (3) A serviceable ECi cylinder assembly, Limited Model DHC–7 Airplanes P/N AEL65102 series, ‘‘Titan’’, having casting (f) If your engine has not been overhauled P/N AEL85099. AGENCY: Federal Aviation or had any major repair since new, no further Administration (FAA), Department of action is required. (4) A serviceable ECi cylinder assembly, P/N AEL65102 series ‘‘Classic Cast’’, having Transportation (DOT). Engines Overhauled or Repaired Since New casting head markings EC 65099–REV–1, that ACTION: Final rule; request for (g) If your engine was overhauled or has a SN 9880 or higher (SN may have an ‘‘L’’ comments. repaired since new, do the following: prefix for a long reach spark plug). (1) Determine if ECi cylinder assemblies, Prohibition of Cylinder Assemblies, P/N SUMMARY: The FAA is adopting a new P/N AEL65102 series ‘‘Classic Cast’’, having AEL65102 Series ‘‘Classic Cast’’, Having airworthiness directive (AD) for certain casting head markings EC 65099–REV–1 and Viking Air Limited Model DHC–7 SNs 1 through 9879 (SN may have an ‘‘L’’ Casting Head Markings EC 65099–REV–1 prefix for a long reach spark plug) are and SNs 1 Through 9879 airplanes. This AD requires revising the installed on your engine, as follows: (i) After the effective date of this AD, do FAA-approved Airworthiness (i) Inspect the engine log books and not install any ECi cylinder assembly, P/N Limitations section of the airplane maintenance records for reference to the AEL65102, having casting head markings EC maintenance manual to prohibit subject ECi cylinder assemblies. 65099–REV–1 that has a SN 1 through 9879 operation of the airplane past its (ii) If the engine log books and (SN may have an ‘‘L’’ prefix for a long reach designed life limit for the primary maintenance records did not record the P/N spark plug), onto any engine. structure, which is 80,000 total flight and SN of the cylinder assemblies, visually cycles. This AD also requires contacting inspect the cylinder assemblies and verify Alternative Methods of Compliance the P/N and SN of the cylinder assemblies. the FAA for approval of analysis that (j) The Manager, Special Certification substantiates that the airplane is safe to (2) If the cylinder assemblies are not ECi, Office, has the authority to approve P/N AEL65102 series ‘‘Classic Cast’’, having alternative methods of compliance for this continue operation beyond the designed casting head markings EC 65099–REV–1, no AD if requested using the procedures found life limit. This AD results from a report further action is required. in 14 CFR 39.19. that the designed life limit for the (3) If any cylinder assembly is an ECi primary structure for the affected P/N AEL65102 series ‘‘Classic Cast’’, having Related Information airplanes is 80,000 total flight cycles. casting head markings EC 65099–REV–1 and (k) ECi Service Bulletin No. 05–08, We are issuing this AD to prevent a SN 1 through 9879 (SN may have an ‘‘L’’ Revision 2, dated February 28, 2006, pertains continued operation of an airplane prefix for a long reach spark plug), do the to the subject of this AD. following: beyond its designed life limit for the (i) If the cylinder assembly has fewer than Issued in Burlington, Massachusetts, on primary structure, which could result in 800 operating hours-in-service (HIS) on the May 31, 2006. reduced structural integrity of the effective date of this AD, replace the cylinder Thomas A. Boudreau, airplane. assembly at no later than 800 operating HIS. Acting Manager, Engine and Propeller No action is required until the operating HIS DATES: This AD becomes effective June Directorate, Aircraft Certification Service. reaches 800 hours. 21, 2006. (ii) If the cylinder assembly has 800 [FR Doc. 06–5127 Filed 6–5–06; 8:45 am] We must receive comments on this operating HIS or more on the effective date BILLING CODE 4910–13–P AD by August 7, 2006.

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ADDRESSES: Use one of the following the TCCA has kept the FAA informed of unnecessary before this AD is issued, addresses to submit comments on this the situation described above. We have and this AD may be made effective in AD. examined the TCCA’s findings, less than 30 days after it is published in • DOT Docket Web site: Go to http:// evaluated all pertinent information, and the Federal Register. determined that we need to issue an AD dms.dot.gov and follow the instructions Comments Invited for sending your comments for products of this type design that are electronically. certificated for operation in the United This AD is a final rule that involves • Government-wide rulemaking Web States. requirements that affect flight safety and site: Go to http://www.regulations.gov Therefore, we are issuing this AD, was not preceded by notice and an and follow the instructions for sending which would require revising the opportunity for public comment; your comments electronically. Airworthiness Limitations section of the however, we invite you to submit any • Mail: Docket Management Facility; Bombardier DHC–7 Dash 7 maintenance relevant written data, views, or U.S. Department of Transportation, 400 manual and the Dash 7 Series 150 arguments regarding this AD. Send your Seventh Street, SW., Nassif Building, maintenance manual to prohibit comments to an address listed in the Room PL–401, Washington, DC 20590. operation of the airplane past its ADDRESSES section. Include ‘‘Docket No. • Fax: (202) 493–2251. designed life limit for the primary FAA–2006–24966; Directorate Identifier • Hand Delivery: Room PL–401 on structure, which is 80,000 total flight 2006–NM–049–AD’’ at the beginning of the plaza level of the Nassif Building, cycles. This AD also requires contacting your comments. We specifically invite 400 Seventh Street, SW., Washington, the FAA for approval to continue comments on the overall regulatory, DC, between 9 a.m. and 5 p.m., Monday operation beyond the designed life economic, environmental, and energy through Friday, except Federal holidays. limit. aspects of the AD that might suggest a need to modify it. FOR FURTHER INFORMATION CONTACT: Differences Between This AD and the We will post all comments we George Duckett, Aerospace Engineer, Canadian Airworthiness Directive receive, without change, to http:// Airframe and Propulsion Branch, ANE– The Canadian airworthiness directive dms.dot.gov, including any personal 171, FAA, New York Aircraft specifies that operators should ground information you provide. We will also Certification Office, 1600 Stewart airplanes that have reached the post a report summarizing each Avenue, suite 410, Westbury, New York designed life limit until operators substantive verbal contact with FAA 11590; telephone (516) 228–7325; fax provide data to substantiate compliance personnel concerning this AD. Using the (516) 794–5531. with Canadian Airworthiness search function of that Web site, anyone SUPPLEMENTARY INFORMATION: Regulation CAR 511.34. This AD can find and read the comments in any Discussion requires that operators contact the FAA of our dockets, including the name of to substantiate continued safe operation the individual who sent the comment Transport Canada Civil Aviation beyond the designed life limit of 80,000 (or signed the comment on behalf of an (TCCA), which is the airworthiness total flight cycles. association, business, labor union, etc.). authority for Canada, notified us that an You may review the DOT’s complete Costs of Compliance unsafe condition may exist on certain Privacy Act Statement in the Federal Viking Air Limited Model DHC–7 None of the airplanes affected by this Register published on April 11, 2000 airplanes. TCCA advises that the action are on the U.S. Register. All (65 FR 19477–78), or you may visit designed life limit for the primary airplanes affected by this AD are http://dms.dot.gov. structure for the affected airplanes is currently operated by non-U.S. 80,000 total flight cycles. TCCA states operators under foreign registry; Examining the Docket that the operator’s approved therefore, they are not directly affected You may examine the AD docket on maintenance schedule should be revised by this AD action. However, we the Internet at http://dms.dot.gov, or in to prohibit operators from flying the consider this AD necessary to ensure person at the Docket Management airplane after it reaches its design goal, that the unsafe condition is addressed if Facility office between 9 a.m. and 5 unless the operator complies with any affected airplane is imported and p.m., Monday through Friday, except further inspections and/or placed on the U.S. Register in the future. Federal holidays. The Docket modifications. Continued operation of If an affected airplane is imported and Management Facility office (telephone an airplane beyond its designed life placed on the U.S. Register in the future, (800) 647–5227) is located on the plaza limit for the primary structure, if not the required AMM revision will take level of the Nassif Building at the DOT corrected, could result in reduced about 1 work hour per airplane at an street address stated in the ADDRESSES structural integrity of the airplane. average labor rate of $80 per work hour. section. Comments will be available in TCAA issued Canadian airworthiness Based on these figures, the cost of the the AD docket shortly after the Docket directive CF–2005–36, dated September AMM revision for U.S. operators will be Management System receives them. 28, 2005, to ensure the continued $80 per airplane. We recognize that this airworthiness of these airplanes in AD may impose certain additional Authority for This Rulemaking Canada. operational costs. However, we cannot Title 49 of the United States Code specifies the FAA’s authority to issue FAA’s Determination and Requirements calculate those costs because we cannot rules on aviation safety. Subtitle I, of This AD predict the extent of any necessary repairs to ensure the continued section 106, describes the authority of This airplane model is manufactured airworthiness of the affected airplanes. the FAA Administrator. Subtitle VII, in Canada and is type certificated for Aviation Programs, describes in more operation in the United States under the FAA’s Determination of the Effective detail the scope of the Agency’s provisions of section 21.29 of the Date authority. Federal Aviation Regulations (14 CFR No airplane affected by this AD is We are issuing this rulemaking under 21.29) and the applicable bilateral currently on the U.S. Register. the authority described in subtitle VII, airworthiness agreement. Pursuant to Therefore, providing notice and part A, subpart III, section 44701, this bilateral airworthiness agreement, opportunity for public comment is ‘‘General requirements.’’ Under that

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section, Congress charges the FAA with Affected ADs Material Incorporated by Reference promoting safe flight of civil aircraft in (b) None (k) None. air commerce by prescribing regulations Applicability Issued in Renton, Washington, on May 31, for practices, methods, and procedures 2006. (c) This AD applies to Viking Air Limited the Administrator finds necessary for Jeffrey E. Duven, safety in air commerce. This regulation Model DHC–7–1, DHC–7–100, DHC–7–101, Acting Manager, Transport Airplane is within the scope of that authority DHC–7–102, and DHC–7–103 airplanes, certificated in any category; except airplanes Directorate, Aircraft Certification Service. because it addresses an unsafe condition having serial numbers 3 through 10 [FR Doc. 06–5119 Filed 6–5–06; 8:45 am] that is likely to exist or develop on inclusive, 12 through 14 inclusive, and 16 BILLING CODE 4910–13–P products identified in this rulemaking through 27 inclusive. action. Unsafe Condition Regulatory Findings (d) This AD results from a report that the DEPARTMENT OF HEALTH AND We have determined that this AD will designed life limit for the primary structure HUMAN SERVICES not have federalism implications under for the affected airplanes is 80,000 total flight Executive Order 13132. This AD will cycles. We are issuing this AD to prevent Food and Drug Administration not have a substantial direct effect on continued operation of an airplane beyond its the States, on the relationship between designed life limit for the primary structure, 21 CFR Part 522 the national government and the States, which could result in reduced structural integrity of the airplane. Implantation or Injectable Dosage or on the distribution of power and Form New Animal Drugs; responsibilities among the various Compliance Oxytetracycline Injection, 200 levels of government. (e) You are responsible for having the Milligram/Milliliter For the reasons discussed above, I actions required by this AD performed within certify that the regulation: the compliance times specified, unless the AGENCY: Food and Drug Administration, 1. Is not a ‘‘significant regulatory actions have already been done. HHS. action’’ under Executive Order 12866; Airworthiness Limitations Revision ACTION: Final rule; technical 2. Is not a ‘‘significant rule’’ under the amendment. DOT Regulatory Policies and Procedures (f) Within 30 days after the effective date (44 FR 11034, February 26, 1979); and of this AD: Revise the FAA-approved SUMMARY: The Food and Drug 3. Will not have a significant Airworthiness Limitations section (ALS) of Administration (FDA) is amending the the Bombardier DHC–7 Dash 7 maintenance economic impact, positive or negative, animal drug regulations to correct the on a substantial number of small entities manual and the Dash 7 Series 150 maintenance manual to state the following indications for use for the 200 milligram under the criteria of the Regulatory (this may be done by inserting a copy of this (mg)/milliliter (mL) strength of Flexibility Act. AD into the ALS). Thereafter, maintain the oxytetracycline injectable solution used We prepared a regulatory evaluation airplane in accordance with the limitations in beef cattle for the treatment and of the estimated costs to comply with specified in these maintenance manual control of various bacterial diseases. this AD and placed it in the AD docket. revisions: This action is being taken to improve See the ADDRESSES section for a location ‘‘Do not operate the airplane beyond the accuracy of the regulations. to examine the regulatory evaluation. 80,000 total flight cycles.’’ DATES: This rule is effective June 6, (g) When the statement specified in 2006. List of Subjects in 14 CFR Part 39 paragraph (f) of this AD has been included Air transportation, Aircraft, Aviation in the general revisions of the ALS, the FOR FURTHER INFORMATION CONTACT: safety, Safety. general revisions may be incorporated into George K. Haibel, Center for Veterinary the ALS and the copy of the AD may be Medicine (HFV–6), Food and Drug Adoption of the Amendment removed from the ALS. Administration, 7519 Standish Pl., I Accordingly, under the authority (h) The airworthiness limitation specified Rockville, MD 20855, 240–276–9019, e- in paragraph (f) of this AD may be removed mail: [email protected]. delegated to me by the Administrator, from the maintenance manuals specified in the FAA amends 14 CFR part 39 as paragraph (f) of this AD after the Manager, SUPPLEMENTARY INFORMATION: FDA has follows: New York Aircraft Certification Office (ACO), found that the April 1, 2005, edition of FAA, approves analysis that substantiates Title 21 parts 500 to 599 of the Code of PART 39—AIRWORTHINESS continued safe operation beyond the Federal Regulations (CFR) does not DIRECTIVES designed life limit of 80,000 total flight accurately reflect the approved cycles. I 1. The authority citation for part 39 indications for use for the 200 mg/mL continues to read as follows: Alternative Methods of Compliance strength of oxytetracycline injectable (AMOCs) solution. Certain indications of use for Authority: 49 U.S.C. 106(g), 40113, 44701. (i)(1) The Manager, New York ACO, FAA, the 300 mg/mL strength of § 39.13 [Amended] has the authority to approve AMOCs for this oxytetracycline injectable solution appear to have been included as an error I 2. The Federal Aviation AD, if requested in accordance with the in the section for the 200 mg/mL Administration (FAA) amends § 39.13 procedures found in 14 CFR 39.19. (2) Before using any AMOC approved in strength solution during reformatting by adding the following new accordance with § 39.19 on any airplane to (69 FR 31878, June 8, 2004). At this airworthiness directive (AD): which the AMOC applies, notify the time, FDA is amending the regulations 2006–12–04 Viking Air Limited (Formerly appropriate principal inspector in the FAA in 21 CFR 522.1660a to reflect the Bombardier, Inc.): Amendment 39– Flight Standards Certificate Holding District correct approved indications for use. Office. 14629. Docket No. FAA–2006–24966; This action is being taken to improve Directorate Identifier 2006–NM–049–AD. Related Information the accuracy of the regulations. Effective Date (j) Canadian airworthiness directive CF– This rule does not meet the definition (a) This AD becomes effective June 21, 2005–36, dated September 28, 2005, also of ‘‘rule’’ in 5 U.S.C. 804(3)(A) because 2006. addresses the subject of this AD. it is a rule of ‘‘particular applicability.’’

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Therefore, it is not subject to the SUPPLEMENTARY INFORMATION: treated as a domestic corporation for all congressional review requirements in 5 purposes of the Code. If such ownership Background U.S.C. 801–808. percentage is 60 percent or more (but A. Section 7874—Overview less than 80 percent), the surrogate List of Subjects in 21 CFR Part 522 This document contains temporary foreign corporation is treated as a Animal drugs. amendments to 26 CFR part 1 under foreign corporation but certain income I Therefore, under the Federal Food, section 7874 of the Internal Revenue or gain required to be recognized by the Drug, and Cosmetic Act and under Code (Code). Section 7874 provides expatriated entity under section 304, authority delegated to the Commissioner rules for expatriated entities and their 311(b), 367, 1001, or any other of Food and Drugs and redelegated to surrogate foreign corporations. An applicable provision with respect to the the Center for Veterinary Medicine, 21 expatriated entity is defined in section transfer of property (other than CFR part 522 is amended as follows: 7874(a)(2)(A) as a domestic corporation inventory or similar property) or the license of property cannot be offset by or partnership with respect to which a PART 522—IMPLANTATION OR net operating losses or credits (other foreign corporation is a surrogate foreign INJECTABLE DOSAGE FORM NEW than credits allowed under section 901). corporation, and also as any U.S. person ANIMAL DRUGS These measures generally apply from related (within the meaning of section the first date properties are acquired I 267(b) or 707(b)(1)) to such domestic 1. The authority citation for 21 CFR pursuant to the plan through the end of part 522 continues to read as follows: corporation or partnership. A foreign corporation is treated as a the 10-year period following the Authority: 21 U.S.C. 360b. completion of the acquisition. surrogate foreign corporation under Section 7874(c)(4) provides that section 7874(a)(2)(B), if, pursuant to a § 522.1660a [Amended] transfers of properties or liabilities plan or a series of related transactions: I 2. In § 522.1660a, remove paragraphs (including by contribution or (i) The foreign corporation directly or (e)(1)(i)(D) and (e)(1)(i)(E). distribution) are disregarded if such indirectly acquires substantially all the Dated: May 25, 2006. transfers are part of a plan a principal properties held directly or indirectly by purpose of which is to avoid the Stephen F. Sundlof, a domestic corporation, or substantially purposes of the section. Director, Center for Veterinary Medicine. all the properties constituting a trade or The IRS and Treasury Department [FR Doc. E6–8694 Filed 6–5–06; 8:45 am] business of a domestic partnership; (ii) have broad authority to issue BILLING CODE 4160–01–S after the acquisition at least 60 percent regulations under section 7874. Section of the stock (by vote or value) of the 7874(c)(6) authorizes the Secretary of foreign corporation is held by (in the the Treasury to prescribe such DEPARTMENT OF THE TREASURY case of an acquisition with respect to a regulations as may be appropriate to domestic corporation) former determine whether a corporation is a Internal Revenue Service shareholders of the domestic surrogate foreign corporation, including corporation by reason of holding stock regulations to treat warrants, options, 26 CFR Part 1 in the domestic corporation, or (in the contracts to acquire stock, convertible case of an acquisition with respect to a debt interests, and other similar [TD 9265] domestic partnership) by former interests as stock, and to treat stock as RIN 1545–BF48 partners of the domestic partnership by not stock. In addition, under section reason of holding a capital or profits 7874(g) the Secretary of the Treasury is Guidance Under Section 7874 interest in the domestic partnership authorized to provide regulations Regarding Expatriated Entities and (ownership percentage test); and (iii) the needed to carry out the section. Those Their Foreign Parents expanded affiliated group that includes regulations could include guidance the foreign corporation (EAG) does not providing adjustments to the AGENCY: Internal Revenue Service (IRS), have business activities in the foreign application of the section as are Treasury. country in which the foreign necessary to prevent the avoidance of ACTION: Temporary regulations. corporation was created or organized the section, including avoidance that are substantial when compared to through the use of related persons, pass- SUMMARY: This document contains the total business activities of the EAG. temporary regulations under section through or other non-corporate entities, Section 7874(c)(1) defines the term 7874 of the Internal Revenue Code or other intermediaries. expanded affiliated group as an The legislative history of section 7874 (Code) relating to the determination of affiliated group defined in section indicates that the section was intended whether a foreign entity shall be treated 1504(a) but without regard to the to apply to so-called inversion as a surrogate foreign corporation under exclusion of foreign corporations in transactions in which a U.S. parent section 7874(a)(2)(B) of the Code. The section 1504(b)(3) and with a reduction corporation of a multinational corporate text of these temporary regulations also of the 80 percent ownership threshold group is replaced by a foreign entity. serves as the text of the proposed of section 1504(a) to a more-than-50 See H.R. Conf. Rep. No. 108–755, 108th regulations (REG–112994–06) set forth percent ownership threshold. Cong., 2d Sess., at 568 (Oct. 7, 2004). in the notice of proposed rulemaking on The tax treatment of expatriated The Senate Finance Committee stated this subject published elsewhere in this entities and surrogate foreign its belief ‘‘that inversion transactions issue of the Federal Register. corporations varies depending on the resulting in a minimal presence in a DATES: Effective Date: These regulations level of owner continuity. If the foreign country of incorporation are a are effective June 6, 2006. percentage of stock (by vote or value) in means of avoiding U.S. tax and should Applicability Dates: For dates of the surrogate foreign corporation held be curtailed.’’ S. Rep. No. 108–192, applicability, see § 1.7874–2T(j). by former owners of the domestic entity, 108th Cong., 1st Sess., at 142 (Nov. 7, FOR FURTHER INFORMATION CONTACT: by reason of holding an interest in the 2003). In particular, Congress believed Milton Cahn, 202–622–3860 (not a toll- domestic entity, is 80 percent or more, that such transactions permit free number). the surrogate foreign corporation is corporations and other entities to

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continue to conduct business in the Department believe that guidance a foreign entity that is considered a same manner as they did prior to the regarding the indirect acquisition of foreign partnership for U.S. federal inversion, but with the result that the properties held directly or indirectly by income tax purposes, despite the fact group that includes the inverted entity a domestic corporation is needed to that interests in the entity are (or will avoids U.S. tax on foreign operations refine further the parameters of the be) publicly traded on a securities and may engage in earnings-stripping provision’s scope. exchange. Although a partnership is a techniques to avoid U.S. tax on U.S. The statute also applies to indirect flow-through entity for Federal income operations. See S. Rep. No. 108–192, at acquisitions of properties constituting a tax purposes, the substitution of a 142 (Nov. 7, 2003); see also Joint trade or business of a domestic foreign partnership for a domestic Committee on Taxation, General partnership. The IRS and Treasury corporation as the parent entity of a Explanation of Tax Legislation Enacted Department are considering guidance multinational group can create many of in the 108th Congress, at 343 (May regarding the application of this part of the same opportunities for U.S. tax 2005). the statute, but are not issuing any such avoidance that Congress sought to The IRS and Treasury Department guidance at this time. curtail by enacting section 7874 have issued temporary and proposed 2. Stock Held by Reason of Holding an (namely, removal of foreign operations regulations under section 7874 relating Interest in the Domestic Entity from U.S. taxing jurisdiction and the use to the application of section 7874(c)(2) of earnings-stripping techniques to (affiliated-owned stock rule), under Section 7874 requires a determination reduce U.S. tax on income from which stock held by members of the of the amount of stock in the acquiring domestic operations). Section 7874(g) is expanded affiliate group that includes foreign entity that is held by former intended to provide authority to address the acquiring foreign corporation (EAG) shareholders or partners of the domestic these types of issues. is not taken into account for purposes of corporation or partnership ‘‘by reason Under section 7704 of the Code, a the ownership percentage test of section of’’ their holding stock or a partnership publicly traded partnership is generally 7874(a)(2)(B)(ii). See TD 9238, 2006–6 interest in the domestic entity. The IRS treated as a corporation for all purposes I.R.B. 408 (Feb. 6, 2006). Those and Treasury Department believe that of the Code. Section 7704(c), however, regulations ensure that the affiliated- guidance is needed as to how this generally provides an exception from owned stock rule cannot be used to determination is made in certain corporate treatment if 90 percent or avoid the application of section 7874, circumstances. more of the partnership’s gross income through the use of hook stock or 3. Substantial Business Activities of the for a taxable year consists of passive otherwise, to situations where that EAG income such as dividends. This provision should apply. In addition, exception does not apply on a look- those regulations ensure that this test Section 7874 does not apply if the through basis in the case of payments does not apply to certain transactions EAG has business activities in the from related parties, so the exception that are properly viewed as outside the foreign country in which, or under the can be satisfied even if the underlying scope of section 7874. laws of which, the acquiring foreign earnings from which the income is paid entity was created or organized that are are not passive in nature. The legislative B. Temporary and Proposed Regulations substantial when compared to the total history of section 7704 indicates that the The temporary and proposed business activities of the EAG. The IRS rationale for this exception was to regulations provide guidance on the and Treasury Department believe that preserve flow-through tax treatment determination of whether a foreign Congress was concerned about where a partnership simply holds entity is treated as a surrogate foreign transactions where the new foreign investments that the partners could corporation under section 7874(a)(2)(B) parent entity is incorporated in a have independently acquired, as of the Code. In particular, the country in which the EAG does not have opposed to business activities that regulations address the indirect a bona fide business presence that is would normally be conducted in acquisition of properties, stock held by meaningful in the context of the group’s corporate form and taxed at the entity reason of holding an interest in a overall business. See S. Rep. No. 108– level. See H.R. Rep. 100–391 (Oct. 26, domestic entity, the substantial business 192, 108th Cong., 2d Sess., at 142 (Nov. 1987) at 1066–1067. In the case of a activities of an EAG, prevention of the 7, 2003) (‘‘The Committee believes that foreign eligible entity that acquires avoidance of section 7874 in certain inversion transactions resulting in directly or indirectly substantially all circumstances, and certain effects of minimal presence in a foreign country the properties of a domestic corporation, being treated as a domestic corporation of incorporation are a means of avoiding or substantially all the properties under section 7874(b). U.S. tax and should be curtailed.’’). The constituting a trade or business of a IRS and Treasury Department believe domestic partnership, the rationale for 1. Indirect Acquisition of Properties that guidance is necessary to ensure the exception provided by section Section 7874 does not apply unless a proper application of the substantial- 7704(c) does not clearly apply. foreign entity completes a direct or business-activities rule. The IRS and Treasury Department indirect acquisition of defined 4. Preventing Avoidance of the Purposes believe it is appropriate to exercise their properties. The legislative history of the of the Section regulatory authority under section section indicates that Congress intended 7874(g) to make adjustments to the the acquisition of stock in a corporation (i). Publicly Traded Foreign Partnership application of the section to prevent to be considered an indirect acquisition as Acquiring Entity avoidance of the purpose of the section of the properties held directly or The IRS and Treasury Department are through the use of certain non-corporate indirectly by the corporation. See H.R. aware of recent transactions in which entities. In the absence of regulations Conf. Rep. No. 108–755, 108th Cong., 2d taxpayers have attempted to avoid the making a relevant adjustment to the Sess., at 573 (Oct. 7, 2004) (‘‘U.S. application of section 7874 through the application of the section, a publicly corporation becomes a subsidiary of a use of a foreign partnership. These traded foreign partnership that is not foreign incorporated entity or otherwise transactions involve the acquisition of treated as a corporation under section transfers substantially all of its substantially all the properties of a 7704 arguably might not be treated as a properties’’). The IRS and Treasury domestic corporation or partnership by surrogate foreign corporation under

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section 7874(a)(2)(B) on the grounds stock in a domestic corporation is rule is subject to the potential that the entity is considered a considered to be an indirect acquisition application of section 7874(c)(4), which partnership rather than a corporation for of a proportionate amount of the requires that transfers be disregarded if Federal income tax purposes. The IRS properties held directly or indirectly by they occur as part of a plan to avoid the and Treasury Department believe that it the domestic corporation. Further, the purposes of section 7874. is contrary to the broad anti-abuse regulations provide that an acquisition The regulations also provide, for purposes of section 7874 for the by a foreign corporation of an interest in purposes of clarity, that the terms provisions to be avoided in a partnership that holds stock in a former shareholders and former circumstances raising the same type of domestic corporation is considered an partners mean any persons who held an earnings stripping and other concerns indirect acquisition of a proportionate ownership interest in the domestic simply by substituting a partnership for amount of the properties held directly entity before the acquisition, regardless a corporation as the acquiring entity or indirectly by the domestic of whether they continue to hold such (often through the ease of a check the corporation. an interest in the domestic entity after box election). To ensure that the The regulations also provide that a the acquisition. foreign corporation’s acquisition of purposes of section 7874 are not C. Substantial Business Activities in the stock in a second foreign corporation is avoided in this manner, the regulations Foreign Country of Incorporation provide that a publicly traded foreign not considered an indirect acquisition partnership that is not treated as a by the first foreign corporation of any The regulations provide both an all- corporation under section 7704 will be properties held by a domestic facts-and-circumstances test and a treated as a foreign corporation for corporation or domestic partnership bright-line safe harbor test of whether an purposes of applying section owned wholly or partly by the second EAG has substantial business activities in the acquiring foreign entity’s country 7874(a)(2)(B) to determine whether the foreign corporation. The IRS and of incorporation when compared to the acquiring foreign entity is a surrogate Treasury Department believe that it was total business activities of the EAG. The foreign corporation. not Congress’s intent for section 7874 to apply to indirect acquisitions by foreign IRS and Treasury Department believe (ii). Options and Similar Interests corporations of domestic entities that that this dual approach appropriately The IRS and Treasury Department are were already owned by a foreign provides taxpayers with the certainty of also concerned that taxpayers may corporation before the acquisition. See an objective and clear safe harbor, while attempt to avoid the purposes of section H.R. Conf. Rep. No. 108–755, 108th preserving the ability of a taxpayer to 7874 through the use of options and Cong., 2d Sess., at 568 (Oct. 7, 2004). conclude, in a case that is not within the similar interests related to stock of the Finally, the regulations provide that, scope of the safe harbor, that section foreign acquirer. Congress foresaw the in acquisitions in which a corporation 7874 is not applicable to a foreign possibility of this type of avoidance and (either domestic or foreign) which is entity’s acquisition of the stock or assets provided a specific grant of regulatory under the control of a foreign of a domestic entity where, after the authority in this regard in section corporation acquires the stock or assets acquisition, the group has a meaningful 7874(c)(6). The IRS and Treasury of a domestic corporation in exchange and bona fide business presence in the Department believe it is appropriate to for stock of the controlling foreign relevant foreign country. This dual exercise that authority at this time. corporation, such foreign corporation approach was also recommended by a will be considered to have made the commentator. 5. Effects of Section 7874(b) acquisition of a proportionate amount of 1. Facts and Circumstances Test Under section 7874(b), a foreign the domestic corporation’s stock or Section 1.7874–2T(d)(1) of the corporation is treated for purposes of assets. regulations provides, as a general rule, the Code as a domestic corporation if it B. Stock Held by Reason of Holding an that the determination of whether the would be a surrogate foreign corporation Interest in the Domestic Entity EAG has substantial business activities if the continuing ownership threshold of Section 1.7874–2T(c) of the in the relevant foreign country, when section 7874(a)(2)(B)(ii) were 80 percent regulations provides that, for purposes compared to the total business activities rather than 60 percent. This of section 7874(a)(2)(B)(ii), stock of the of the EAG, will be based on an analysis ‘‘domestication’’ rule gives rise to acquiring foreign entity that is received of all the facts and circumstances of certain issues relating to the application in exchange for stock of a domestic each case. The regulations set forth a of other provisions of the Code. The IRS corporation, or in exchange for a capital non-exclusive list of factors to be and Treasury Department believe that or profits interest in a domestic considered in the analysis. The weight guidance on these issues is necessary to partnership, is considered to be stock given to any factor will depend on the avoid uncertainty. held by reason of holding stock in the particular circumstances. The listed Explanation of Provisions domestic corporation or holding the factors include, among other factors, the interest in the domestic partnership, as EAG’s local employee headcount and A. Indirect Acquisition of Properties the case may be. Moreover, the payroll, property, and sales; the EAG’s Held by a Domestic Corporation regulations provide that, where, in the historical presence in the foreign Commentators requested that specific same transaction or series of related country; its management activities in guidance be provided regarding the transactions, other property is also the country; and the strategic application of section 7874 to contributed to the foreign entity in importance to the EAG as a whole of the acquisitions of stock, to clarify that such exchange for its stock, the amount of business activities in that country. acquisitions are indirect acquisitions of stock held by a former shareholder of The regulations state that the presence the properties held by the corporation the domestic corporation or former or absence of any factor, or any whose stock is acquired. partner of the domestic partnership for particular number of factors, in the list To this end, section 1.7874–2T(b) of section 7874 purposes is determined on is not determinative, and that there is no the regulations provides that, for the basis of the relative value of the minimum percentage of the group’s total purposes of section 7874(a)(2)(B)(i), an property in exchange for which the employee headcount, payroll, assets, or acquisition by a foreign corporation of foreign entity’s stock was issued. This sales that must be shown to be in the

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foreign country. Nevertheless, the does not satisfy the safe harbor test, it the application of section 7874 are determination of substantiality for this still may satisfy the facts and disregarded. purpose must be made on the basis of circumstances test of § 1.7874–2T(d)(1). The IRS and Treasury Department a comparison to the total activities of This safe harbor test is consistent with specifically excluded intangible assets the EAG, and the factors in the list must the approach suggested by a from the definition of group assets, even be evaluated accordingly. commentator. though intangibles may be used in the Congress intended to prevent The safe harbor test is satisfied if the course of active business operations. taxpayers from avoiding section 7874 EAG satisfies three conditions, relating The reason for excluding intangibles is through tax-motivated transfers of to employees, assets, and sales. Under that they frequently present difficult properties or liabilities, by providing in section 7874, the determination of factual issues relating to their use, section 7874(c)(4) that such transfers whether an EAG’s business activities in value, and location. Therefore, their shall be disregarded. Therefore, in the relevant foreign country are inclusion in the definition of group analyzing the facts and circumstances to substantial when compared to the total assets for purposes of the safe harbor determine whether an EAG’s business business activities of the EAG is to be test would introduce a significant activities in the relevant foreign country made ‘‘after the acquisition.’’ Given the element of uncertainty in many cases as are substantial within the meaning of practical difficulty of measuring the to the application of the safe harbor the statute, it is necessary to disregard various business factors on dates other rule. Given that the purpose of the safe any assets, liabilities or activities in the than the periodic dates during the year harbor rule is to provide a clear, bright- foreign country that were transferred as of which an EAG’s management line test, it was decided that the pursuant to a plan a principal purpose accounts are prepared, the regulations definition of group assets should not of which was to avoid section 7874. provide for the determination of group include intangibles. This exclusion was The regulations also provide that employees, assets, and sales during a also suggested by a commentator. certain factors are not to be given weight twelve month testing period ending on The third condition of the safe harbor in making the determination under the the last day of the monthly or quarterly rule is that, during the twelve-month facts and circumstances test. These accounting period in which the testing period, the group sales made in factors include any assets that are completion of the acquisition occurs. the foreign country accounted for at temporarily located in the foreign Moreover, the determination of facts least 10 percent of total group sales. country for the purpose of avoiding the existing on that day for purposes of the The term group sales is defined as purposes of section 7874. safe harbor rule is subject to the sales by group members, measured by Although the list of factors to be application of section 7874(c)(4), under gross receipts from such sales. Group disregarded does not include passive which any transfer is disregarded if sales are considered to be made in a assets, the IRS and Treasury Department made pursuant to a plan a principal particular country only if the services, believe that the statutory phrase purpose of which is to avoid the goods or other property transferred by ‘‘business activities’’ ordinarily does not purposes of section 7874. those sales are sold for use, include passive investment activities The first condition of the safe harbor consumption or disposition in that and related income and assets. rule is that, after the acquisition, the country. The term ‘‘sales’’ includes sales Investment assets may include group employees based in the foreign of services and of the use of property as intangible assets that have significant country account for at least 10 percent well as sales involving the transfer of value but are not being exploited by any (by headcount and compensation) of title to personal property. member of the EAG in the course of total group employees. Consideration was given to the use of active business activities. In contrast, The term group employee is defined thresholds higher than the 10 percent as a common law employee of one or intangibles that are used in the course figure used in the safe harbor rule. more group members on a full time of active business operations by EAG However, based on comments received, basis throughout the twelve-month members will normally be accorded due the IRS and Treasury Department testing period. An employee is weight by the IRS in the application of believe that 10 percent is a reasonable considered to be based in a country only the all-facts-and-circumstances test. In threshold. order to preserve a wide breadth for the if the employee spent more time all-facts-and-circumstances rule, providing services in such country than D. Prevention of Avoidance of Section investment assets and income have not in any other country throughout such 7874 been included in the list of factors to be twelve-month period. The second condition is that, after the 1. Acquisitions by Publicly Traded given no weight, but it is expected that Foreign Partnerships such passive assets and income acquisition, the total value of the group normally would not be given any assets located in the foreign country It has been brought to the attention of significant weight. represents at least 10 percent of the total the IRS and Treasury that taxpayers are value of all group assets. implementing structures (including 2. Safe Harbor Test The term group assets is defined as partnership structures) that result in Section 1.7874–2T(d)(2) of the tangible property used or held for use in many of the same overall tax regulations sets forth an alternative, safe the active conduct of a trade or business consequences as structures that harbor test for determining whether, by a group member. An item of tangible Congress intended to be subject to after the acquisition, an EAG has personal property is considered to be section 7874, but are taking the position substantial business activities in the located in a country only if such item that these structures are not within the relevant foreign country, when was physically present in such country scope of section 7874. As a result, the compared to the total business activities for more time than in any other country IRS and Treasury Department have of the EAG. The safe harbor test will during the twelve-month testing period. identified acquisitions by certain only be satisfied by an EAG that has a Value is determined on a gross basis publicly traded foreign partnerships as substantial and bona fide business (that is, without reduction for liabilities) a category of transactions requiring a presence in the relevant foreign country. after the acquisition. Group assets special rule in order to prevent The IRS and Treasury Department acquired or transferred as part of a plan avoidance of the purposes of section intend, however, that even if the EAG a principal purpose of which is to avoid 7874. Section 7874(g) provides broad

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regulatory authority to adjust the from a foreign partnership to a domestic partnership by former owners of the application of the section to prevent corporation. acquired domestic entity by reason of avoidance of the purposes of the section In contrast, if the entity is considered their former ownership, the foreign through the use of non-corporate a surrogate foreign corporation but the partnership should not be treated as a entities. Commentators have also agreed ownership percentage under section domestic corporation, despite the that this authority exists. Accordingly, 7874(a)(2)(B)(ii) is at least 60 percent language of section 7874(b), but rather § 1.7874–2T(e) provides that a publicly but less than 80 percent, the foreign should be treated as a domestic traded foreign partnership will be entity will be a foreign partnership for partnership. The reasons given treated as a foreign corporation for all purposes of the Code, but section included: (1) Because a partnership is a purposes of applying section 7874(a)(1) will govern the Federal flow-through entity for tax purposes, the 7874(a)(2)(B) and § 1.7874–2T to income tax treatment of the expatriated United States persons owning interests determine whether it is a surrogate entity (that is, the domestic corporation in the partnership would be taxable on foreign corporation. or domestic partnership whose assets the partnership’s income, including The regulations define publicly traded were acquired directly or indirectly by subpart F income attributable to foreign partnership for purposes of this the foreign partnership, and any United earnings-stripping transactions between rule as any foreign partnership that States person who is related under domestic subsidiaries of the partnership would, but for the application of section sections 267(b) or 707(b)(1)). and foreign subsidiaries; and (2) the 7704(c), be treated as a corporation Finally, if the publicly traded foreign entity classification rules of under section 7704 of the Code at any partnership is not considered to be a §§ 301.7701–2 and 301.7701–3 are time during the two-year period surrogate foreign corporation, because intended to allow taxpayers to choose following the partnership’s completion the ownership percentage under section whether a foreign eligible entity is a of an acquisition described in section 7874(a)(2)(B)(ii) is less than 60 percent, corporation or partnership for Federal 7874(a)(2)(B)(i). Under section 7704, a because the EAG has substantial income tax purposes, and section partnership is generally treated as a business activities in the country in 7874(b) does not impinge on that corporation if interests in the which, or under the laws of which, the freedom of choice, but only deems a partnership are traded on an established foreign partnership was created or foreign corporation to be a domestic securities market, or if interests in the organized, or otherwise, section 7874 corporation. partnership are readily tradable on a will not apply to the foreign On balance, the IRS and Treasury secondary market or the substantial partnership, or to the domestic entity, Department do not find these arguments equivalent. Section 7704(c) generally the assets of which it directly or determinative. Section 7874 does not provides an exception for a publicly indirectly acquired, and the foreign focus on the taxation of the owners of traded partnership where 90 percent or partnership will continue to be the acquired domestic entity and the more of its gross income consists of classified as a foreign partnership for all acquiring foreign entity, nor does the qualifying income (which includes purposes of the Code. statute focus on whether such owners dividends from controlled subsidiaries). Section 1.7874–2T(e) applies equally are United States persons or foreign If a publicly traded foreign to foreign entities that are considered persons. The section imposes tax partnership is within the scope of the partnerships under both foreign law and consequences only on either the regulations, the foreign partnership will U.S. federal income tax law, and foreign acquiring foreign entity or the acquired be considered to be a foreign entities that are considered corporate domestic entity (or related domestic corporation, and if it meets the entities under foreign law but are entities). Therefore, the fact that United requirements of section 7874(c)(1), may treated as partnerships for U.S. federal States persons owning interests in the be a member of the EAG, in determining income tax purposes under Treasury acquiring partnership would be subject whether it is a surrogate foreign regulation § 301.7701–3. to United States tax on the partnership’s corporation under section 7874(a)(2)(B). The regulations include a provision income is not determinative of the For purposes of applying the substantial that explicitly removes from the scope appropriate treatment of a foreign business activities test of section of section 7874 a partnership’s deemed partnership that is within the scope of 7874(a)(2)(B)(iii), the foreign acquisition of assets and liabilities section 7874(b) after application of the partnership will be considered to be a under § 1.708–1(b)(4) upon a anti-avoidance rule of paragraph (e) of corporation created or organized in, or termination of the partnership due to these regulations. under the laws of, the foreign country in change of ownership. In the absence of The argument relating to the entity which, or under the laws of which, the such a provision, section 7874 might classification rules has perhaps a foreign partnership was created or apply to a deemed acquisition by a stronger foundation. However, for the organized. Moreover, interests in the publicly traded foreign partnership of a reasons mentioned above, the IRS and foreign partnership will be treated as domestic entity representing at least 60 Treasury Department believe that the stock of such foreign corporation for percent of the value of the partnership’s intention of Congress in enacting both purposes of applying the ownership assets, merely because of active trading section 7874 and section 7704 is carried percentage test of section of interests in the partnership. There is out by a rule which treats a publicly 7874(a)(2)(B)(ii). no indication in the legislative history traded foreign partnership as a domestic If the foreign partnership is that section 7874 was intended to apply corporation in those circumstances in considered a surrogate foreign in that situation. which the partnership otherwise would corporation, and the ownership Comments were received by the IRS be within the scope of section 7874(b) percentage under section and Treasury Department regarding the if it were a corporation. 7874(a)(2)(B)(ii) is at least 80 percent, consequences under section 7874 where The IRS and Treasury Department the foreign partnership will be treated a foreign partnership satisfies the recognize that the use of a foreign under section 7874(b) as a domestic definition of a surrogate foreign partnership that is not publicly traded, corporation for all purposes of the Code. corporation when treated as a foreign or the use of a domestic partnership, to A conversion rule is provided in the corporation for definitional purposes. It acquire the properties of a domestic regulations to clarify the Federal income was argued that, in cases of 80 percent corporation might enable taxpayers to tax consequences of the deemed change or greater ownership of the foreign avoid the purposes of section 7874 in

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certain cases. Comments are solicited However, taxpayers may apply the partnerships that are not publicly traded below on whether future regulations regulations to acquisitions completed and domestic partnerships (including under section 7874 or another provision prior to such date, but must do so limited liability companies), could also of the Code should address these consistently with respect to all be used to avoid the purposes of situations. acquisitions within the scope of the sections 7874 and 7704, and whether regulations. 2. Options and Similar Interests Treated further guidance addressing such as Stock of the Foreign Acquirer Request for Comments avoidance is warranted. Based on the regulatory authority The IRS and Treasury Department are Effective Date provided in section 7874(c)(6), considering issuing subsequent public Section 1.7874–2T applies to § 1.7874–2T(f) of the regulations guidance that addresses additional acquisitions completed on or after June provides that options and similar issues under section 7874. This 6, 2006. Taxpayers may elect to apply interests held by a former shareholder or guidance may address issues related to the section to acquisitions completed former partner of the expatriated entity (1) The determination of whether there prior to that date, but must apply it by reason of holding stock or a has been a direct or indirect acquisition consistently to all acquisitions within partnership interest in the expatriated of substantially all the properties held its scope. entity will be treated, for purposes of directly or indirectly by a domestic the ownership test of section corporation or substantially all the Special Analyses 7874(a)(2)(B)(ii), as exercised, to the properties constituting a trade or It has been determined that this extent that the effect is to treat the business of a domestic partnership; (2) Treasury decision is not a significant foreign corporation as a surrogate the requirement that such acquisition be regulatory action as defined in foreign corporation. An interest that is pursuant to a plan or a series of related Executive Order 12866. Therefore, a similar to an option is defined for these transactions; (3) the treatment of stock regulatory assessment is not required. purposes as including, without sold in a public offering that is related These regulations are necessary to limitation, a warrant, a convertible debt to the acquisition; and (4) the disregard provide immediate guidance to prevent instrument or other convertible of transfers of properties or liabilities if avoidance of section 7874 in situations instrument, a put, a stock interest the transfers are part of a plan a where it should apply as well as to subject to risk of forfeiture, and a principal purpose of which is to avoid provide immediate guidance on contract to acquire or sell stock. the purposes of section 7874. The IRS situations where it should not apply. These rules are consistent with and Treasury Department specifically Accordingly, good cause is found for existing rules under section 382, which request comments regarding appropriate dispensing with notice and public has identical statutory language, in rules in relation to these issues arising comment pursuant to 5 U.S.C. 553(b)(B) section 382(k)(6)(B), to that of section under section 7874. and with a delayed effective date 7874(c)(6). The IRS and Treasury One commentator has recommended pursuant to 5 U.S.C. 553(d)(3). For Department are continuing to study that preferred stock described in section applicability of the Regulatory whether other types of interests should 1504(a)(4) should be disregarded in Flexibility Act (5 U.S.C. chapter 6) refer also be treated as stock of the acquirer applying the ownership percentage test to the Special Analyses section of the under regulations issued under the of section 7874(a)(2)(B)(ii) and the preamble to the cross-reference notice of authority of section 7874(c)(6). special safe harbor rules of § 1.7874– proposed rulemaking published in the 1T(c). The IRS and Treasury Department E. Effects of Section 7874(b) Proposed Rules section in this issue of are carefully considering this the Federal Register. Pursuant to Section 1.7874–2T(g) provides that a recommendation and solicit additional section 7805(f), this Treasury decision foreign corporation that is treated as a comments as to whether future guidance will be submitted to the Chief Counsel domestic corporation under section should include such a rule. for Advocacy of the Small Business 7874(b) is treated, for purposes of the In addition, the IRS and Treasury Administration for comment on its Code other than determining whether Department are considering whether impact on small business. the foreign corporation is a surrogate and how to amend § 1.367(a)–3(c), foreign corporation, as converting to a which deals with the tax consequences Drafting Information domestic corporation pursuant to a of a United States person’s transfer of The principal author of this regulation reorganization described in section stock of a domestic corporation to a is Jefferson VanderWolk, Office of 368(a)(1)(F) immediately before the foreign acquiring corporation, as a result Associate Chief Counsel (International). commencement of the acquisition. It of the enactment of section 7874 and the However, other personnel from the IRS follows that, in a case in which the promulgation of regulations thereunder. and Treasury Department participated foreign corporation was newly formed A commentator has asked for these in its development. for the purpose of the transaction, the amendments. Additional comments are effect will be that it is treated as a requested. List of Subjects in 26 CFR Part 1 domestic corporation from its inception. Based on comments received, the IRS Income taxes, Reporting and Further, § 1.7874–2T(h) provides that, if and Treasury Department identified recordkeeping requirements. section 7874(b) applies to a surrogate inversion transactions using a publicly Amendments to the Regulations foreign corporation, section 367 does traded foreign partnership as the new not apply to any transfer of stock or foreign parent entity of the inverted I Accordingly, 26 CFR part 1 is other property to such entity as part of group as a category of transactions amended as follows: the acquisition described in section requiring a special rule in order to 7874(a)(2)(B)(i). prevent avoidance of the purposes of PART 1—INCOME TAXES section 7874, in light of the F. Effective Dates Congressional purpose in enacting I Paragraph 1. The authority citation The regulations apply to acquisitions section 7704. Comments are requested for part 1 continues to read, in part, as completed on or after the date of their as to whether other types of follows: publication in the Federal Register. partnerships, such as foreign Authority: 26 U.S.C. 7805 * * *

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I Par. 2. Sections 1.7874–2T is added to 7874(a)(2)(B)(i), an acquisition by a Example 4. Acquisition by controlled read as follows: foreign corporation of stock of a second corporation.—FS, a foreign corporation, is foreign corporation is not considered an 90% owned by foreign corporation FP. § 1.7874–2T Surrogate foreign corporation indirect acquisition by the first foreign Pursuant to a plan of reorganization, FS (temporary). acquires all the stock of DT, a domestic corporation of any properties held (a) Scope. This section provides rules corporation, in exchange for stock of FP directly or indirectly by a domestic which is exchanged with the shareholders of under section 7874(a)(2)(B) for corporation or domestic partnership determining whether a foreign DT on a one-for-one basis. For purposes of owned directly or indirectly, wholly or section 7874(a)(2)(B)(i) and paragraph (b)(1) corporation shall be treated as a partly, by the second foreign of this section, FP is considered to have surrogate foreign corporation. Paragraph corporation. acquired 90% of the stock of DT and thus to (b) of this section provides rules under (3) Acquisition of an interest in a have made an indirect acquisition of 90% of section 7874(a)(2)(B)(i) regarding the partnership. For purposes of section the properties held directly or indirectly by indirect acquisition of properties held 7874(a)(2)(B)(i), an acquisition by a DT. If FS had acquired substantially all the assets of DT, rather than the stock of DT, in directly or indirectly by a domestic foreign corporation of a capital or profits corporation or domestic partnership. exchange for stock of FP, FP would be interest in a foreign or domestic considered to have acquired 90% of the Paragraph (c) of this section provides partnership that holds stock in a rules under section 7874(a)(2)(B)(ii) for assets of DT for purposes of section domestic corporation is considered an 7874(a)(2)(B)(i). identifying stock of the entity held by indirect acquisition by such foreign former shareholders or partners of the (c) Stock held by former shareholders corporation of a proportionate amount domestic entity by reason of holding or partners by reason of holding stock or of the properties held directly or stock or a partnership interest in the a partnership interest in the domestic indirectly by such domestic corporation. domestic entity. Paragraph (d) of this entity—(1) General rule. For purposes of (4) Acquisition of stock or assets of a section 7874(a)(2)(B)(ii), stock of the section provides rules under section domestic corporation by controlled 7874(a)(2)(B)(iii) for determining foreign corporation which is received by subsidiary. For purposes of section a former shareholder of the domestic whether the expanded affiliated group 7874(a)(2)(B)(i) and paragraph (b)(1) of (as defined in section 7874(c)(1)) that corporation in exchange for stock of the this section, if a corporation acquires includes the entity (EAG) has domestic corporation is considered stock or assets of a domestic corporation substantial business activities in the stock held by reason of holding stock in in exchange for stock of a foreign foreign country in which, or under the the domestic corporation. Similarly, for corporation which owns directly or laws of which, the entity was created or purposes of section 7874(a)(2)(B)(ii), indirectly, after the acquisition, more organized, when compared to the total stock of the foreign corporation which is than 50 percent of the stock (by vote or business activities of the EAG. received by a former partner of the value) of the acquiring corporation, such Paragraph (e) of this section provides domestic partnership in exchange for a foreign corporation is considered as rules under which a publicly traded capital or profits interest in the acquiring a proportionate amount of foreign partnership is treated as a domestic partnership is considered such stock or assets of the domestic foreign corporation for purposes of stock held by reason of holding a capital corporation. or profits interest in the domestic determining whether it is a surrogate (5) Examples. The application of this partnership. Subject to section foreign corporation under section paragraph is illustrated by the following 7874(c)(4), in cases where the foreign 7874(a)(2)(B), and rules regarding the examples. It is assumed that all corporation also issues stock to a former consequences under the Code if a transactions in the examples occur after shareholder of the domestic corporation partnership is treated as a surrogate March 4, 2003. The examples read as or partner of the domestic partnership foreign corporation. Paragraph (f) of this follows: section provides rules under which in the same transaction or series of certain interests held by former Example 1. Acquisition of stock of transactions in exchange for shareholders or partners of the domestic domestic corporation.—A is a domestic consideration other than stock in the corporation with 100 shares of a single class domestic corporation or a capital or entity are treated as stock of the foreign of common stock outstanding. F, a foreign entity making the acquisition described corporation, acquires 25 shares of A stock profits interest in the domestic in section 7874(a)(2)(B)(i). Paragraph (g) from a shareholder of A. For purposes of partnership, the percentage of the of this section provides rules relating to section 7874(a)(2)(B)(i), F is considered to foreign corporation’s stock considered the change in status from a foreign have made an indirect acquisition of 25% of to be held by former shareholders of the corporation to a domestic corporation the properties held directly or indirectly by domestic corporation or former partners under section 7874(b). Paragraph (h) of A. of the domestic partnership by reason of this section provides that section 367 is Example 2. Acquisition of stock of foreign holding stock in the domestic not applicable to the transfer of assets or corporation.—The facts are the same as in corporation or a capital or profits Example 1 except as follows: All of A’s stock stock to a surrogate foreign corporation is held by B, a foreign corporation. C, a interest in the domestic partnership that is treated as a domestic corporation foreign corporation, acquires 25 shares of B shall be determined on the basis of the under section 7874(b). stock from a shareholder of B. For purposes relative value of the property in (b) Indirect acquisition of properties— of section 7874(a)(2)(B)(i), C is not exchange for which the foreign (1) Acquisition of stock of a domestic considered to have made an indirect corporation’s stock was issued. corporation. For purposes of section acquisition of any portion of the properties (2) Former shareholders and former 7874(a)(2)(B)(i), an acquisition by a held directly or indirectly by A. partners. For purposes of this section, foreign corporation of stock of a Example 3. Acquisition of partnership former shareholders of the domestic domestic corporation is considered an interest.—D is a partnership which owns all corporation are persons who held stock of the issued and outstanding stock of E, a in the domestic corporation before the indirect acquisition by such foreign domestic corporation. G, a foreign corporation of a proportionate amount corporation, acquires a 40% interest in D acquisition, including persons (if any) of the properties held directly or from a partner in D. For purposes of section who held stock in the domestic indirectly by such domestic corporation. 7874(a)(2)(B)(i), G is considered to have made corporation both before and after the (2) Acquisition of stock of a foreign an indirect acquisition of 40% of the acquisition. Former partners of the corporation. For purposes of section properties held directly or indirectly by E. domestic partnership are persons who

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held a capital or profits interest in the (ii) Factors to be considered. Relevant (iii) Assets. This paragraph (d)(2)(iii) domestic partnership before the factors indicating that the EAG has applies if, after the acquisition, the total acquisition, including persons (if any) substantial business activities in the value of the group assets located in the who held a capital or profits interest in foreign country when compared to the foreign country is at least 10 percent of the domestic partnership both before total business activities of the EAG the total value of all group assets. and after the acquisition. include, but are not limited to, the (iv) Sales. This paragraph (d)(2)(iv) (3) Example. The following example factors set forth below. The presence or applies if, during the testing period, the illustrates the application of this absence of any factor, or of a particular group sales made in the foreign country paragraph: number of factors, is not determinative. accounted for at least 10 percent of total Example. Contribution of stock of domestic Moreover, the weight given to any factor group sales. and foreign corporations. A holds all of the (whether or not set forth below) (3) Definitions and application of issued and outstanding common stock of DC, depends on the particular case. Relevant rules. For purposes of paragraph (d) of FC1, FC2, and FC3. DC is a domestic factors include, but are not limited to— this section— corporation, and FC1, FC2, and FC3 are (A) Historical presence. The conduct (i) The term group employee means a foreign corporations. Each of DC, FC1, FC2, of continuous business activities in the common law employee of one or more and FC3 has only one class of stock members of the EAG who worked full outstanding. DC’s outstanding stock is worth foreign country by EAG members prior to the acquisition; time (meaning normally 35 or more $40x, FC1’s outstanding stock is worth $20x, hours per week) throughout the testing FC2’s outstanding stock is worth $25x, and (B) Operational activities. Business FC3’s outstanding stock is worth $15x. In a activities of the EAG in the foreign period. An independent contractor transaction subject to section 351, A country occurring in the ordinary course performing activities on behalf of an contributes the stock of DC, FC1, FC2, and of the active conduct of one or more EAG member is not a group employee. FC3 to FP, a foreign corporation, in exchange trades or businesses, involving— A group employee is considered to be for all of the issued and outstanding common (1) Property located in the foreign based in a country only if the group stock of FP. The transaction occurs after country which is owned by members of employee spent more time providing March 4, 2003. For purposes of section the EAG; services in such country than in any 7874(a)(2)(B)(ii), A is considered to hold 40% other country throughout the testing of the stock of FP by reason of holding stock (2) The performance of services by in DC. individuals in the foreign country who period and continues to provide are employed by members of the EAG; services in such country immediately (d) Substantial business activities of and after the acquisition. The compensation the EAG—(1) General rule—(i) Facts (3) Sales to customers in the foreign of a group employee is determined in and circumstances test. Subject to country by EAG members; United States dollars and, in the case of paragraph (d)(2) of this section, the (C) Management activities. The compensation denominated in a foreign determination of whether, after the performance in the foreign country of currency, translated into United States acquisition, the EAG has substantial substantial managerial activities by EAG dollars using the weighted average business activities in the foreign country members’ officers and employees who exchange rate for the taxable year, as in which, or under the law of which, the are based in the foreign country; defined in § 1.989(b)–1. acquiring foreign entity is created or (D) Ownership. A substantial degree (ii) The term group assets means organized, when compared to the total of ownership of the EAG by investors tangible property used or held for use in business activities of the EAG, shall be resident in the foreign country. the active conduct of a trade or business made on the basis of all of the facts and (E) Strategic factors. The existence of by a member of the EAG. An item of circumstances. However, the factors business activities in the foreign country tangible personal property is considered described in paragraph (d)(1)(iii) of this that are material to the achievement of to be located in a country only if such section shall not be taken into account the EAG’s overall business objectives. item was physically present in such in making the determination. For the (iii) Factors not to be considered. Any country for more time than in any other EAG to have substantial business assets, activities, or income attributable country during the testing period. The activities in the foreign country when to a transfer or transfers disregarded total value of group assets is determined compared to the total business activities under section 7874(c)(4) are not relevant for purposes of this paragraph on the of the EAG, there is no minimum factors to be considered. In addition, last day of the testing period, on a gross percentage of its total business activities any assets that are temporarily located basis (that is, not reduced by liabilities), (regardless of how measured) that must in a foreign country at any time as part measured by either tax book value or be in the foreign country. It is necessary, of a plan a principal purpose of which fair market value, but not both, in however, for the determination of is to avoid the purposes of section 7874 United States dollars translated if substantiality to be made on the basis of are not relevant factors to be considered. necessary at the spot rate determined a comparison to the total business (2) Safe harbor—(i) Elements. The under the principles of § 1.988–1(d)(1), activities of the EAG, and the factors set EAG will be considered to have (2) and (4). Group assets do not include forth in paragraph (d)(1)(ii) of this substantial business activities, after the property located in a country by reason section are to be evaluated accordingly. acquisition, in the foreign country in of a transfer, or a change of geographic Thus, it is possible that the business which, or under the law of which, the location, pursuant to a plan a principal activities of an EAG in a particular acquiring foreign entity was created or purpose of which is to avoid the country would be substantial when organized, when compared to the total application of section 7874. In addition, compared to the total business activities business activities of the EAG, if intangible assets are not taken into of such EAG, but the identical business paragraphs (d)(2)(ii), (iii), and (iv) of this account (in either the numerator or activities of another EAG in the same section apply. denominator) in calculating the amount country would not be substantial when (ii) Employees. This paragraph of group assets. compared to the total business activities (d)(2)(ii) applies if, after the acquisition, (iii) The term group sales means sales of that EAG because the total business the group employees based in the and the provision of services by activities of the second EAG were much foreign country account for at least 10 members of the EAG, measured by gross more extensive than the total business percent (by headcount and receipts from such sales and services, in activities of the first EAG. compensation) of total group employees. United States dollars (determined, in

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the case of gross receipts denominated (ii) Conclusion. In light of all the facts and preceding the merger. The merger was in a foreign currency, using the circumstances, after the acquisition, the EAG prompted by a third group’s attempt to obtain weighted average exchange rate for the does not have substantial business activities control of the domestic corporation and its taxable year, as defined in Treas. Reg. in Country A when compared to the total subsidiaries without the consent of the business activities of the EAG. management of the domestic corporation. § 1.989(b)–1). A group sale is considered Example 2. Manufacturing in foreign After the merger, the Country A corporation to be made in a country only if the country.—(i) Facts. EAG members own and is more than 60% owned by former services, goods or other property have continuously operated a manufacturing shareholders of the domestic corporation, transferred by such sale are sold for use, facility and warehouses in Country A for due to the fact that the domestic corporation consumption or disposition in such several years prior to the acquisition. The was significantly more valuable than the country. goods produced in Country A represented Country A corporation. After the merger, the approximately 2% of the total value of the stock of the Country A corporation is (iv) If one or more members of the EAG’s production of finished goods in the publicly traded on stock exchanges in both EAG own capital or profits interests in 12-month period ending on the date of the Country A and the United States. Group a partnership, the proportionate amount acquisition. Group employees based in employees based in Country A perform all of of activities, employees, assets, income Country A also regularly perform back office the functions involved in the EAG’s overall and sales of such partnership are services for other EAG members. Fewer than business activities, including headquarters considered to be activities, employees, 5% of group employees were based in and senior management functions. After the assets, income and sales of the member Country A during the 12-month period merger, approximately 11% of group or members of the EAG. A partner’s ending after the acquisition. Less than 2% of employees are based in Country A, the total proportionate share shall be determined group sales were made in Country A during value of group assets located in Country A is the 12-month period ending after the approximately 10% of the value of total under the rules and principles of acquisition. The total value of group assets group assets, and the estimated percentage of sections 701 through 706 and the located in Country A after the acquisition is group sales that will be made in Country A regulations thereunder. approximately 4% of total group assets. None during the year following the merger is (v) The term testing period means the of the EAG’s senior managers are based in approximately 7%. 12 month period ending on the last day Country A. (ii) Conclusion. In light of all the facts and of the EAG’s monthly or quarterly (ii) Conclusion. In light of all the facts and circumstances, after the acquisition, the EAG has substantial business activities in Country management accounting period in circumstances, after the acquisition, the EAG does not have substantial business activities A when compared to the total business which the acquisition is completed and in Country A when compared to the total activities of the EAG. the term after the acquisition means, for business activities of the EAG. Example 5. Relocation of business to purposes of paragraphs (d)(1)(i) and Example 3. Financial services group; real foreign country.—(i) Facts. The EAG’s (d)(2)(ii) and (iii) of this section, the last estate in foreign country.—(i) Facts. The business involves advanced technology. The day of the testing period. EAG’s main line of business is financial controlling shareholders of the Country A (4) Examples. The application of services. Group employees based in Country corporation that is the parent entity in the EAG, and the senior managers of the EAG, paragraph (d)(1) of this section is A regularly perform back office services for other EAG members. Fewer than 5% of group are resident in Country A. The controlling illustrated by the following examples of employees were based in Country A during shareholders originally established DC, a business activities of an EAG in a the 12-month period ending on the date of domestic corporation, which established its foreign country after an acquisition the acquisition. Less than 3% of group sales head office in City B in the United States, described in section 7874(a)(2)(B)(i). In were made in Country A during the same where a leading institute of technology is each example, the acquiring foreign period. However, the total value of group located. Part of DC’s business strategy was to entity is incorporated in Country A. assets located in Country A after the hire research personnel who had been Paragraph (d)(2) of this section does not acquisition is more than 10% of the value of trained at the institute of technology and had total group assets, due to the fact that EAG settled in City B. DC hired 10 researchers apply to any of the examples. The who worked at DC’s premises in City B. DC examples are not intended to allow any members purchased a substantial amount of commercial and residential real estate in also established FS, a wholly owned Country inferences to be drawn as to whether the Country A during the 24 months preceding A subsidiary, which hired research personnel presence or absence, in a particular the acquisition. The management of the real in Country A to perform research and case, of one or more facts described in estate is performed by an unrelated product development functions at FS’s an example is determinative as to independent agent. Most of the EAG’s senior premises in Country A. Subsequently, the whether an EAG does, or does not, have managers are based outside Country A. The senior managers and controlling shareholders substantial business activities in the EAG’s real estate portfolio in Country A was adopted a new business strategy involving the closure of the U.S. operations and the relevant foreign country when not acquired pursuant to a strategic plan for one or more of the EAG’s worldwide lines of transfer of DC’s business and FS’s stock to compared to the total business activities FP, a new Country A corporation, with the of the EAG. The examples read as business, nor are the EAG’s business activities in Country A material to the result of centering the EAG’s business in follows: achievement of the EAG’s overall business Country A. Pursuant to the new strategy, DC Example 1. Administrative activities and objectives. terminated the employment of seven researchers and the lease on its City B some customer services.—(i) Facts. Group (ii) Conclusion. In light of all the facts and premises, relocated the other three employees based in Country A regularly circumstances, after the acquisition, the EAG researchers from City B to Country A, and perform administrative, back office services does not have substantial business activities transferred its remaining assets, including the for other EAG members, and regularly in Country A when compared to the total stock of FS, to FP in exchange for more than provide customer service globally via business activities of the EAG. 80% of the stock of FP. After the acquisition, telephone and e-mail at a communications Example 4. Foreign group merging with substantially all of the group employees were center located in Country A. After the larger U.S. group.—(i) Facts. The Country A based in Country A, and substantially all of acquisition, fewer than 2% of group corporation that is the parent entity in the the group assets were located in Country A. employees are based in Country A. Less than EAG acquired a domestic corporation and its (ii) Conclusion. In light of all the facts and 3% of group sales were made in Country A subsidiaries pursuant to a merger agreement. circumstances, after the acquisition, the EAG in the 12-month period ending on the date Before the merger, the stock of both the has substantial business activities in Country of the acquisition. The total value of group Country A corporation and the domestic A when compared to the total business assets located in Country A on the date of the corporation was publicly traded in their activities of the EAG. acquisition is approximately 2% of total respective countries of incorporation. The group assets. None of the EAG’s senior two groups were competitors in the same (e) Acquisition by publicly traded managers are based in Country A. global line of business for many years foreign partnership—(1) Treatment as a

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foreign corporation. For purposes of commencement of the acquisition, be foreign corporation rather than a foreign applying section 7874(a)(2)(B) and this treated as transferring all of its assets partnership, and ownership interests in section, a publicly traded foreign and liabilities to a newly formed FQ are considered to be stock of FQ. partnership shall be treated as a foreign domestic corporation in exchange for Therefore, on the basis of these facts, FQ corporation created or organized in, or the stock of the domestic corporation, is a surrogate foreign corporation under the laws of, the foreign country in and distributing such stock to its because all of the conditions stated in which, or under the laws of which, such partners in liquidation of their interests section 7874(a)(2)(B) are satisfied. partnership was created or organized, in the partnership. The tax treatment of Because the former shareholders of DP and interests in such partnership shall the transaction shall be determined hold more than 80% of FQ’s ownership be treated as stock of such foreign under all relevant provisions of the interests, FQ is treated under section corporation. In determining whether the Internal Revenue Code and general 7874(b) as a domestic corporation for publicly traded foreign partnership is a principles of tax law, including the step purposes of the Internal Revenue Code. surrogate foreign corporation, the transaction doctrine. In addition, the former shareholders of publicly traded foreign partnership will (4) Disregard of deemed acquisition. DP are treated as having received stock be treated as a member of the EAG, if For purposes of paragraph (e)(1) of this of domestic corporation FQ in exchange the requirements of section 7874(c)(1) section, a publicly traded foreign for their stock of DP. are met. If this paragraph is applicable partnership’s deemed acquisition of Example 2. Substantial business activities and the provisions of section assets and liabilities under § 1.708– of the EAG in the foreign country of 7874(a)(2)(B) are satisfied such that the 1(b)(4) is not a direct or indirect incorporation.—(i) Facts. The facts are the foreign entity making the acquisition is acquisition of properties to which same as in Example 1 except that, after the a surrogate foreign corporation to which section 7874(a)(2)(B)(i) could apply. acquisition, the EAG that includes FQ has section 7874(b) applies, the foreign (5) Examples. The application of this substantial business activities in foreign entity shall be treated as a domestic paragraph is illustrated by the following country X when compared to the total corporation for purposes of the Internal examples. It is assumed that all business activities of the EAG under the Revenue Code. See paragraph (e)(3) of criteria set forth in paragraph (d) of this transactions in the examples occur after section. this section for the deemed treatment of March 4, 2003, and that any foreign the change in form from a foreign partnership referred to in an example is (ii) Analysis. For purposes of partnership to a domestic corporation. If not treated as a corporation under determining whether FQ is a surrogate this paragraph is applicable and the section 7704. The examples read as foreign corporation under section provisions of section 7874(a)(2)(B) are follows: 7874(a)(2)(B), FQ is considered to be a satisfied such that the foreign entity foreign corporation rather than a foreign making the acquisition is a surrogate Example 1. Foreign hybrid entity; public partnership, and ownership interests in trading of ownership interests on stock foreign corporation to which section market following triangular merger.—(i) FQ are considered to be stock of FQ. On 7874(b) does not apply, the foreign Facts. The stock of DP, a domestic the basis of these facts, FQ is not a entity shall continue to be a foreign corporation, is publicly traded on stock surrogate foreign corporation, because, partnership for purposes of the Internal exchange SE. Pursuant to a plan, DP and an after the acquisition, the EAG that Revenue Code, but the tax treatment of unrelated person form a foreign subsidiary includes FQ has substantial business the expatriated entity shall be governed entity, FQ, under the laws of foreign country activities in foreign country X when by section 7874(a)(1). If this paragraph X, transferring a minimal amount of cash to compared to the total business activities is applicable, but the provisions of FQ in the process. DP owns 99.9% of FQ and of the EAG. Therefore, section 7874 section 7874(a)(2)(B) are not satisfied the unrelated party owns 0.1% of FQ. FQ is does not apply to the acquisition, and such that the foreign partnership a limited liability company and is a foreign eligible entity under § 301.7701–2. FQ makes the status of FQ as a foreign partnership making the acquisition is not a surrogate an election under § 301.7701–3 to be treated is unaffected. foreign corporation, the status of the as a partnership for Federal income tax Example 3. Acquisition by publicly traded publicly traded foreign partnership will purposes as of the date of its formation. FQ foreign partnership owned by former not be affected by section 7874 or forms a wholly owned domestic corporation, shareholders and unrelated persons.—(i) § 1.7874–2T. DS, under the laws of State A. Under a Facts. The facts are the same as in Example (2) Publicly traded foreign merger agreement and State A law, DS 1 except that, at the time of the merger partnership. For purposes of this merges into DP,with DP surviving the merger transaction, unrelated persons who did not section, the term publicly traded foreign as a wholly owned subsidiary of FQ and the own any stock of DP transfer stock of a partnership means any foreign former shareholders of DP receiving foreign corporation to FQ in exchange for partnership that would, but for the ownership interests in FQ in exchange for 25% of the ownership interests in FQ. their DP stock. On the day of the merger, the application of section 7704(c), be treated Former shareholders of DP receive 75% of stock of DP ceases to be listed on stock the ownership interests in FQ. as a corporation under section 7704 at exchange SE. Trading of ownership interests (ii) Analysis. For purposes of determining any time during the two-year period of FQ on stock exchange SE commences on whether FQ is a surrogate foreign corporation following the partnership’s completion the day after the day of the merger. FQ, under section 7874(a)(2)(B), FQ is considered of an acquisition described in section however, is not treated as a corporation to be a foreign corporation rather than a 7874(a)(2)(B)(i). under section 7704, due to the application of foreign partnership, and ownership interests (3) Deemed treatment of change from section 7704(c). After the acquisition, the in FQ are considered to be stock of FQ. foreign partnership to domestic corporate group owned by FQ does not have Therefore, on the basis of these facts, and corporation. Except for purposes of substantial business activities in foreign taking into account the provisions of section determining whether it is a surrogate country X when compared to its total 7874(c)(4), FQ is a surrogate foreign foreign corporation under section business activities. corporation, because all of the conditions 7874(a)(2)(B) and § 1.7874–2T, a foreign (ii) Analysis. FQ is a publicly traded stated in section 7874(a)(2)(B) are satisfied. Because the former shareholders of DP hold partnership that is treated as a domestic foreign partnership under paragraph less than 80% of FQ’s ownership interests, corporation pursuant to the application (e)(1) of this section. For purposes of FQ is not treated under section 7874(b) as a of paragraph (e)(1) of this section and determining whether FQ is a surrogate domestic corporation for purposes of the the application of section 7874(b) and foreign corporation under section Internal Revenue Code. Rather, FQ is a § 1.7874–2T shall, immediately before 7874(a)(2)(B), FQ is considered to be a foreign partnership for purposes of the

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Internal Revenue Code, and section pursuant to paragraph (f)(1) of this section, determined under all relevant provisions of 7874(a)(1) applies in determining the Federal the convertible bonds are treated as being the Code and general principles of tax law, income tax liability of DP and any other converted into 55 shares of FA stock for including the step transaction doctrine. expatriated entity (as defined in section purposes of section 7874(a)(2)(B)(ii). 7874(a)(2)). Therefore, the section 7874(a)(2)(B)(ii) (2) Entity classification. An entity that is treated as a domestic corporation (f) Options and similar interests fraction is 80/100, the resulting percentage is under section 7874(b) is not an eligible treated as stock of the foreign acquiring 80% and FA is a surrogate foreign corporation. In addition, pursuant to section entity as defined in § 301.7701–3(a) of corporation—(1) General rule. For 7874(b), FA is treated as a domestic this chapter and therefore may not elect purposes of section 7874(a)(2)(B)(ii), corporation. noncorporate status. options and interests that are similar to options held by a person by reason of (g) Change from foreign to domestic (3) Time of determination. Subject to holding stock in the domestic status.—(1) Conversion—(i) General the application of the step transaction corporation or a capital or profits rule. Except for purposes of determining doctrine and section 7874(c)(4), the interest in the domestic partnership whether it is a surrogate foreign determination of whether a foreign described in section 7874(a)(2)(B)(i) corporation under section 7874(a)(2)(B) entity is a surrogate foreign corporation shall be treated as exercised. The prior and § 1.7874–2T, the conversion of a is made immediately after completion of sentence shall apply, however, only to foreign corporation to a domestic the acquisition described in section the extent that the effect of such corporation under section 7874(b) shall, 7874(a)(2)(B)(i), except as provided in exercise is to treat the foreign entity that immediately before commencement of paragraphs (d)(3)(v) and (e)(2) of this has made the acquisition described in the acquisition described in section section. A foreign entity that is treated section 7874(a)(2)(B)(i) as a surrogate 7874(a)(2)(B)(i), be treated as a as a domestic corporation under section foreign corporation under section reorganization described in section 7874(b) shall continue to be treated as 7874(a)(2)(B). 368(a)(1)(F). For the consequences of the a domestic corporation without regard (2) Interests that are similar to conversion, see § 1.367(b)–2(f). See also to whether the provisions of section options. For purposes of paragraph (f)(1) § 1.367(b)–3. The tax treatment of all 7874(a)(2)(B)(ii) and (iii) are satisfied at of this section, an interest that is similar aspects of the transaction other than a later time. to an option includes, but is not limited such conversion shall be determined (h) Nonapplication of section 367—(1) to, a warrant, a convertible debt under all relevant provisions of the General rule. If section 7874(b) applies instrument, an instrument other than Code and general principles of tax law, to a surrogate foreign corporation, debt that is convertible into stock, a put, including the step transaction doctrine. section 367 shall not apply to the a stock interest subject to risk of (ii) Example. The following example transfer of stock or other property to forfeiture, and a contract to acquire or illustrates the application of paragraph such entity as part of the acquisition sell stock. (g)(1)(i) of this section. It is assumed described in section 7874(a)(2)(B)(i). (3) Example. The application of this that the transaction in the example (2) Example. The following example paragraph is illustrated by the following occurs after March 4, 2003. The example illustrates the application of paragraphs example. It is assumed that the reads as follows: (g) and (h)(1) of this section. It is transaction in the example occurs after Conversion treated as reorganization under assumed that the transaction in the March 4, 2003. The example reads as section 368(a)(1)(F).—(i) Facts. DT, a example occurs after March 4, 2003. The follows: domestic corporation is owned by a group of example reads as follows: individuals. FA, a foreign corporation Example. Convertible bonds treated as Example. Conversion of foreign unrelated to DT which has been conducting stock of foreign corporation.—(i) Facts. DT, a corporation to domestic corporation.—(i) a trade or business for several years, has 20 domestic corporation with 80 shares of stock Facts. FP, a newly formed foreign issued and outstanding, is owned by a group shares of stock issued and outstanding. corporation, acquires pursuant to a plan of individuals. FA, a foreign corporation Pursuant to a plan, the shareholders of DT substantially all of the stock of DX, a unrelated to DT, has 20 shares of stock issued transfer all of their shares of DT to FA in domestic corporation, by issuing its stock to and outstanding. Pursuant to a plan, the exchange for 80 newly issued shares of FA the owners of DX in exchange for their DX shareholders of DT transfer all of their shares stock. After the acquisition, the EAG that stock. The former owners of DX, all of whom of DT to FA in exchange for 25 newly issued includes FA does not have substantial are U.S. persons, hold more than 80% of the shares of FA stock (with a value of $25x) and business activities in FA’s country of stock of FP by reason of their ownership of $55x of FA bonds that are convertible at the incorporation when compared to the total DX stock. The EAG that includes FP does not election of the holder into 55 shares of FA business activities of the EAG. have substantial business activities in FP’s stock, for no additional consideration, at any (ii) Analysis. FA has indirectly acquired country of incorporation after the acquisition time during the ensuing 5-year period. After substantially all the properties held directly when compared to the total business the acquisition, the EAG that includes FA or indirectly by DT pursuant to a plan. After activities of the EAG. does not have substantial business activities the acquisition, the former shareholders of (ii) Analysis. FP is a surrogate foreign in FA’s country of incorporation when DT own 80 shares of FA stock by reason of corporation under section 7874(a)(2)(B). compared to the total business activities of holding stock in DT. Accordingly, the section Under section 7874(b), FP is treated as a the EAG. 7874(a)(2)(B)(ii) fraction is 80/100, the domestic corporation for purposes of the (ii) Analysis. FA has indirectly acquired resulting percentage is 80%, and FA is a Internal Revenue Code. In addition, the substantially all the properties held directly surrogate foreign corporation. In addition, former owners of DX are not subject to or indirectly by DT pursuant to a plan. Before pursuant to section 7874(b), FA is treated as section 367 with respect to the transfer of the application of this paragraph (f), the a domestic corporation. Other than for their DX stock to FP. former shareholders of DT own 25 shares of purposes of determining whether FA is a FA stock by reason of holding stock in DT. surrogate foreign corporation, the conversion (i) [Reserved.] Accordingly, the section 7874(a)(2)(B)(ii) of FA from a foreign corporation to a (j) Effective date. This section shall fraction would be 25/45, the resulting domestic corporation shall, immediately apply to acquisitions completed on or before FA’s acquisition of the DT stock, be percentage would be 55%, and FA would not after June 6, 2006. However, taxpayers be a surrogate foreign corporation. Pursuant treated as a reorganization under section to paragraph (f)(2) of this section, the FA 368(a)(1)(F). See §§ 1.367(b)–2(f) and may apply this section to acquisitions convertible bonds issued to the former 1.367(b)–3. The tax treatment of all other completed prior to that date, but must shareholders of DT are treated as interests aspects of the transaction, including the apply it consistently to all acquisitions that are similar to options. As a result, and acquisition of the DT stock by FA, is within its scope.

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Approved: May 22, 2006. Chicago, Illinois 60604. This facility is NOX (NO and NO2) emissions will not Mark E. Matthews, open from 8:30 a.m. to 4:30 p.m., always reduce ozone levels. When the Deputy Commissioner for Services and Monday through Friday, excluding ratio of NO to VOC emissions is high, Enforcement. Federal holidays. We recommend that the NO will react with ozone (O3) to Eric Solomon, you telephone Matt Rau, Environmental form NO2 and oxygen (O2). In this Engineer, at (312) 886–6524 before Acting Deputy Assistant Secretary of the environment, the NO2 will react with Treasury. visiting the Region 5 office. hydroxyl (OH) radicals instead of

[FR Doc. E6–8699 Filed 6–5–06; 8:45 am] FOR FURTHER INFORMATION CONTACT: Matt forming ozone. A decrease in NOX Rau, Environmental Engineer, Criteria emissions would cause an increase in BILLING CODE 4830–01–P Pollutant Section, Air Programs Branch ozone formation when these conditions (AR–18J), U.S. Environmental exist. This effect is usually localized. Protection Agency, Region 5, 77 West ENVIRONMENTAL PROTECTION Because of this chemical reaction, the Jackson Boulevard, Chicago, Illinois AGENCY section 182(f) exemptions should not 60604, (312) 886–6524, interfere with attainment of the standard 40 CFR Part 52 [email protected]. NAAQS for ozone in the six Michigan SUPPLEMENTARY INFORMATION: ozone nonattainment areas. The state [EPA–R05–OAR–2005–MI–0001; FRL–8176– demonstrated that the areas were able to 6] Throughout this document whenever ‘‘we,’’ ‘‘us,’’ or ‘‘our’’ is used, we mean hold ozone levels under the NAAQS Approval and Promulgation of Air EPA. This supplementary information without employing NOX controls. Thus, Quality Implementation Plans; section is arranged as follows: additional NOX controls would not be expected to contribute to attainment. Michigan I. What Is EPA’s Analysis of the Supporting Materials? Ozone levels are expected to remain AGENCY: Environmental Protection II. What Are the Environmental Effects of below the standard which will protect Agency (EPA). These Actions? human health. If a violation occurs in ACTION: Final rule. III. What Is EPA’s Response to Comments? one of the areas, EPA will remove the IV. What Action Is EPA Taking Today? exemption for that area and will require SUMMARY: EPA is approving a June 17, V. Statutory and Executive Order Reviews additional control measures. 2005, Michigan petition for exemptions I. What Is EPA’s Analysis of the III. What Is EPA’s Response to from the Reasonably Available Control Supporting Materials? Technology (RACT) and New Source Comments? Michigan submitted the 2002–04 Review (NSR) requirements for major EPA received one comment on the monitoring data for the six ozone sources of nitrogen oxides (NOX). The January 5, 2006 (71 FR 577–579), nonattainment areas. The eight-hour petition is for sources in six of proposed approval of Michigan’s ozone concentrations for these areas Michigan’s eight-hour ozone petition. That comment came from the were all below the National Ambient nonattainment areas, which comprise New York State Department of Air Quality Standard (NAAQS)for eleven counties. EPA proposed approval Environmental Conservation (New ozone. EPA records indicate the 2003– of the petition in a January 5, 2006 York). New York was concerned that 05 monitoring data is also below the rulemaking action. Section 182(f) of the EPA did not evaluate the impact of the Clean Air Act allows this exemption for eight-hour ozone NAAQS for all six areas. Michigan has not implemented NOX waivers on its ozone areas where additional reductions in nonattainment areas. It cited the results NO will not contribute to attainment of NOX control provisions in the areas. X EPA’s January 14, 2005 document, of ozone contribution modeling from the ozone standard. The Grand Rapids, ‘‘Guidance on Limiting Nitrogen Oxides another EPA program, the Clean Air Kalamazoo/Battle Creek, Lansing/East Requirements Related to 8-Hour Ozone Interstate Rule. The contribution Lansing, Benzie County, Huron County, Implementation’’ gives the requirements modeling shows a link between state- and Mason County nonattainment areas for demonstrating that further NO wide Michigan NOX and VOC emissions will each receive an exemption. X reduction in an ozone nonattainment and nineteen counties, including the DATES: This final rule is effective on July area will not contribute to ozone New York ozone nonattainment 6, 2006. attainment. The guidance provides that counties of Erie, Richmond, and Suffolk. ADDRESSES: EPA has established a three consecutive years of monitoring In considering this petition, EPA did docket for this action under Docket ID data below the standard in areas that not evaluate the impact of the NOX No. EPA–R05–OAR–2005–0001. All have not implemented NOX controls waivers on downwind ozone documents in the docket are listed on adequately demonstrates that additional nonattainment areas. This is not a part the www.regulations.gov Web site. NOX reductions will not aid attainment. of the process for evaluating section Although listed in the index, some EPA’s approval of the petition is granted 182(f) waiver requests. The NOX information is not publicly available, on a contingent basis. Michigan must emission reductions required from i.e., Confidential Business Information continue to monitor the ozone levels in Michigan under other EPA programs are (CBI) or other information whose the areas. Each of the six areas receives not affected by granting of the waivers. disclosure is restricted by statute. its own exemption. If an area violates Also, reductions of other ozone Certain other material, such as the standard, EPA will remove the precursors, such as VOC, are unaffected copyrighted material, is not placed on exemption for that area. by this action. If called for under other the Internet and will be publicly programs, Michigan will be required to available only in hard copy form. II. What Are the Environmental Effects reduce its state-wide emissions to Publicly available docket materials are of These Actions? address its contribution to available either electronically through Nitrogen oxides are a precursor in nonattainment counties in other states. http://www.regulations.gov or in hard ozone formation. Volatile organic The Clean Air Interstate Rule will copy at the Environmental Protection compounds (VOC) are another ozone address the specific concern New York Agency, Region 5, Air and Radiation precursor. The photochemical reactions expressed by requiring ozone precursor Division, 77 West Jackson Boulevard, that form ozone are complex. Reducing reductions in Michigan and other states

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that contribute to the New York ozone Regulatory Flexibility Act (5 U.S.C. 601 that otherwise satisfies the provisions of nonattainment areas. et seq.). the Clean Air Act. Thus, the requirements of section 12(d) of the IV. What Action Is EPA Taking Today? Unfunded Mandates Reform Act National Technology Transfer and EPA is approving a Michigan petition Because this rule approves pre- Advancement Act of 1995 (15 U.S.C. for exemptions from the RACT and NSR existing requirements under state law 272 note) do not apply. requirements for major NOX sources in and does not impose any additional six of the state’s eight-hour ozone enforceable duty beyond that required Paperwork Reduction Act nonattainment areas. These by state law, it does not contain any This rule does not impose an nonattainment areas encompass eleven unfunded mandate or significantly or information collection burden under the counties. The Grand Rapids area uniquely affect small governments, as provisions of the Paperwork Reduction includes Kent and Ottawa counties. described in the Unfunded Mandates Act of 1995 (44 U.S.C. 3501 et seq.). Calhoun, Kalamazoo, and Van Buren Reform Act of 1995 (Pub. L. 104–4). counties make up the Kalamazoo/Battle Congressional Review Act Executive Order 13175: Consultation Creek area. The Lansing/East Lansing The Congressional Review Act, 5 and Coordination With Indian Tribal area consists of Clinton, Eaton, and U.S.C. 801 et seq., as added by the Small Governments Ingham counties. Benzie, Huron, and Business Regulatory Enforcement Mason counties are all single county This rule also does not have tribal Fairness Act of 1996, generally provides nonattainment areas. implications because it will not have a that before a rule may take effect, the Section 182(f) of the Clean Air Act substantial direct effect on one or more agency promulgating the rule must allows this exemption for areas where a Indian tribes, on the relationship submit a rule report, which includes a state demonstrates that additional between the Federal Government and copy of the rule, to each House of the reductions in NOX will not contribute to Indian tribes, or on the distribution of Congress and to the Comptroller General attainment of the NAAQS for ozone. power and responsibilities between the of the United States. EPA will submit a Monitoring data shows the ozone levels Federal Government and Indian tribes, report containing this rule and other in the six areas are now below the as specified by Executive Order 13175 required information to the U.S. Senate, NAAQS without utilizing NOX controls. (65 FR 67249, November 9, 2000). the U.S. House of Representatives, and These exemptions from the NOX Executive Order 13132: Federalism the Comptroller General of the United requirements in section 182(f) are on a States prior to publication of the rule in contingent basis. The state used This action also does not have the Federal Register. A major rule monitoring data to demonstrate that it Federalism implications because it does cannot take effect until 60 days after it meets the requirements for the not have substantial direct effects on the is published in the Federal Register. exemption. If an area’s monitored level states, on the relationship between the This action is not a ‘‘major rule’’ as of ozone violates the NAAQS in the National Government and the States, or defined by 5 U.S.C. 804(2). future, EPA will remove its exemption. on the distribution of power and Under Section 307(b)(1) of the Clean V. Statutory and Executive Order responsibilities among the various Air Act, petitions for judicial review of Reviews levels of government, as specified in this action must be filed in the United Executive Order 13132 (64 FR 43255, States Court of Appeals for the Executive Order 12866: Regulatory August 10, 1999). This action merely appropriate circuit by August 7, 2006. Planning and Review approves a state rule implementing a Filing a petition for reconsideration by Under Executive Order 12866 (58 FR federal standard, and does not alter the the Administrator of this final rule does 51735, October 4, 1993), this action is relationship or the distribution of power not affect the finality of this rule for the not a ‘‘significant regulatory action’’ and and responsibilities established in the purposes of judicial review nor does it therefore is not subject to review by the Clean Air Act. extend the time within which a petition Office of Management and Budget. Executive Order 13045: Protection of for judicial review may be filed, and Executive Order 13211: Actions Children From Environmental Health shall not postpone the effectiveness of Concerning Regulations That and Safety Risks such rule or action. This action may not be challenged later in proceedings to Significantly Affect Energy Supply, This rule also is not subject to Distribution, or Use enforce its requirements. (See Section Executive Order 13045 ‘‘Protection of 307(b)(2).) Because it is not a ‘‘significant Children from Environmental Health regulatory action’’ under Executive Risks and Safety Risks’’ (62 FR 19885, List of Subjects in 40 CFR Part 52 Order 12866 or a ‘‘significant energy April 23, 1997), because it is not Environmental protection, Air action,’’ this action is also not subject to economically significant. pollution control, Intergovernmental Executive Order 13211, ‘‘Actions National Technology Transfer relations, Nitrogen dioxide, Ozone. Concerning Regulations That Advancement Act Significantly Affect Energy Supply, Dated: May 18, 2006. Distribution, or Use’’ (66 FR 28355, May In reviewing SIP submissions, EPA’s Bharat Mathur, 22, 2001). role is to approve state choices, Acting Regional Administrator, Region 5. provided that they meet the criteria of I Regulatory Flexibility Act For the reasons stated in the preamble, the Clean Air Act. In this context, in the part 52, chapter I, of title 40 of the Code This action merely approves state law absence of a prior existing requirement of Federal Regulations is amended as as meeting federal requirements and for the state to use voluntary consensus follows: imposes no additional requirements standards (VCS), EPA has no authority beyond those imposed by state law. to disapprove a SIP submission for PART 52—[AMENDED] Accordingly, the Administrator certifies failure to use VCS. It would thus be that this rule will not have a significant inconsistent with applicable law for I 1. The authority citation for part 52 economic impact on a substantial EPA, when it reviews a SIP submission, continues to read as follows: number of small entities under the to use VCS in place of a SIP submission Authority: 42 U.S.C. 7401 et seq.

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Subpart X—Michigan ACTION: Final rule. available either electronically through http://www.regulations.gov or in hard I 2. Section 52.1174 is amended as SUMMARY: This final rule will implement copy at the Air Docket, EPA/DC, EPA follows: the requirements for sulfur, cetane and West, Room B102, 1301 Constitution I A. The first paragraph designated as aromatics for highway, nonroad, Ave., NW., Washington, DC. The Public paragraph (c) is redesignated as locomotive and marine diesel fuel Reading Room is open from 8:30 a.m. to paragraph (c)(1). produced in, imported into, and 4:30 p.m., Monday through Friday, I B. The second paragraph designated distributed or used in the rural areas of excluding legal holidays. The telephone as paragraph (c) is redesignated as Alaska. Beginning June 1, 2010, diesel number for the Public Reading Room is paragraph (c)(2). fuel used in these applications must I C. Paragraph (w) is added to read as meet a 15 ppm (maximum) sulfur (202) 566–1744, and the telephone follows: content standard. This rule will assist number for the Air Docket is (202) 566– 1742. § 52.1174 Control strategy: Ozone. the implementation of the programs for highway and nonroad diesel fuels in * * * * * FOR FURTHER INFORMATION CONTACT: Jeff (w) Approval—On June 17, 2005, the Alaska and provide some limited Herzog or Tia Sutton, Assessment and Michigan Department of Environmental additional lead time for development of Standards Division, Office of Quality submitted a petition requesting any necessary changes to the fuel Transportation and Air Quality, the exemption from Clean Air Act distribution system in Alaska’s rural Environmental Protection Agency, 2000 oxides of nitrogen control requirements areas. We believe this additional lead Traverwood Drive, Ann Arbor, MI in six 8-hour ozone nonattainment time is appropriate given the 48105; fax number: (734) 214–4816; circumstances in the rural areas. In areas. The Grand Rapids, Kalamazoo/ telephone numbers: (734) 214–4227 or 2010, highway and nonroad fuel in rural Battle Creek, Lansing/East Lansing, (734) 214–4018, respectively; e-mail Alaska will be required to meet the 15 Benzie County, Huron County, and addresses: [email protected] or ppm sulfur standard, providing the full Mason County nonattainment areas each [email protected], respectively. receive an exemption. Section 182(f) of environmental benefits of these the 1990 amended Clean Air Act programs to rural Alaska as well. In SUPPLEMENTARY INFORMATION: addition, fuel used by engines in rural authorizes the exceptions. The I. General Information exemption will no longer apply in an Alaska covered by the new source area if it experiences a violation of the performance standard (NSPS) for new A. Does This Action Apply to Me? 8-hour ozone standard. stationary diesel engines will also be required to meet the 15 ppm sulfur You are regulated by this rule if you [FR Doc. 06–4986 Filed 6–5–06; 8:45 am] standard in 2010. produce, import, distribute, or sell BILLING CODE 6560–50–P DATES: This final rule is effective on July diesel fuel for use in the rural areas of 6, 2006. Alaska. The following table gives some ENVIRONMENTAL PROTECTION ADDRESSES: EPA has established a examples of entities that must follow AGENCY docket for this action under Docket ID the regulations. However, because these No. EPA–HQ–OAR–2004–0229. All are only examples, you should carefully 40 CFR Part 69 documents in the docket are listed on examine the regulations in 40 CFR part 80. If you have questions, call the [EPA–HQ–OAR–2004–0229; FRL–8178–3] the http://www.regulations.gov Web site. Although listed in the index, some person listed in the FOR FURTHER RIN 2060–AJ72 information is not publicly available, INFORMATION CONTACT section of this preamble: Control of Air Pollution From Motor e.g., CBI or other information whose Vehicles and Nonroad Diesel Engines: disclosure is restricted by statute. Alternative Low-Sulfur Diesel Fuel Certain other material, such as Transition Program for Alaska copyrighted material, is not placed on the Internet and will be publicly AGENCY: Environmental Protection available only in hard copy form. Agency (EPA). Publicly available docket materials are

Examples of potentially regulated entities NAICS codes a SIC codes b

Petroleum Refiners ...... 32411 2911 Petroleum Bulk Stations, Terminals ...... 42271 5171 Petroleum and Products Wholesalers ...... 42272 5172 Diesel Fuel Trucking ...... 48422 4212 48423 4213 Diesel Service Stations ...... 44711 5541 44719 ...... a North American Industry Classification System (NAICS). b Standard Industrial Classification (SIC) system code.

Electronic Access. You may access is available through EPA’s electronic public docket, and to access those this Federal Register document public docket and comment system, documents in the public docket that are electronically through the EPA Internet EPA Dockets. You may use EPA Dockets available electronically. Once in the under the ‘‘Federal Register’’ listings at at http://www.epa.gov/edocket/ view system, select ‘‘search,’’ then key in the http://www.epa.gov/fedrgstr/. An public comments, access the index appropriate docket identification electronic version of the public docket listing of the contents of the official number.

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Certain types of information are not comment, including the copyrighted 5. Ensure Enforceability included in the EPA Dockets. material, will be available in the public B. NRLM and Stationary Diesel Fuel Information claimed as CBI as well as docket. V. Transition Dates for Urban Areas of Alaska other information, the disclosure of For additional information about VI. What Is the Emissions Impact of This EPA’s electronic public docket visit EPA Rule? which is restricted by statute, is not VII. Statutory and Executive Order Reviews available for public viewing in EPA’s Dockets online or see 67 FR 38102, May A. Executive Order 12866: Regulatory electronic public docket. EPA’s policy is 31, 2002. Planning and Review that copyrighted material is not to be Outline of This Preamble B. Paperwork Reduction Act placed in EPA’s electronic public docket C. Regulatory Flexibility Act II. Background D. Unfunded Mandates Reform Act but is available only in printed, paper A. How Was Alaska Treated in the E. Federalism form in the official public docket. To the Highway Diesel Rule? F. Consultation and Coordination With extent feasible, public docket materials B. How Was Alaska Treated in the NRLM Indian Tribal Governments are available in EPA’s electronic public Diesel Rule? G. Protection of Children From C. Alaska’s Submission and Comments in docket. When a document is selected Environmental Health & Safety Risks Response to NRLM Proposal from the index list in EPA Dockets, the H. Executive Order 13211: Actions That D. How Was Alaska Treated in the NSPS system identifies whether the document Significantly Affect Energy Supply, for New Stationary Diesel Engines? is available for viewing in EPA’s Distribution, or Use III. What Is EPA Specifying for Rural Areas electronic public docket. Although not of Alaska? I. National Technology Transfer and all docket materials may be available A. Highway Diesel Fuel Advancement Act electronically, you may still access any B. Nonroad, Locomotive, Marine and J. Congressional Review Act of the publicly available docket Stationary Engine Diesel Fuel VIII. Statutory Provisions and Legal materials through the docket facility C. Summary of Sulfur Standards for Alaska Authority identified above. IV. Why Are We Specifying a June 1, 2010 II. Background It is EPA’s policy that public Effective Date for Rural Areas of Alaska? A. Highway Diesel Fuel A. How Was Alaska Treated in the comments, whether submitted 1. Ensure an Adequate Supply (Either Highway Diesel Rule? electronically or on paper, are available, Through Production or Imports) of 15 without change, for public viewing in ppm Sulfur Diesel Fuel To Meet the The nationwide implementation dates EPA’s electronic public docket as EPA Demand of Any Model Year 2007 or (including those for all of Alaska) for receives them, unless the comment Later Vehicles highway diesel fuel at 40 CFR 80.500 et contains copyrighted material, CBI, or 2. Ensure Sufficient Retail Availability of seq. are shown in Table II.A–1. (See 66 other information the disclosure of Low Sulfur Fuel for New Vehicles in FR 5002, January 18, 2001; also see which is restricted by statute. When Alaska Revisions to Motor Vehicle Diesel Fuel 3. Address the Growth of Supply and EPA identifies a comment containing Availability Over Time as More New Sulfur Transition Provisions and copyrighted material, we provide a Vehicles Enter the Fleet Technical Amendments to the Highway reference to that material in the version 4. Include Measures To Ensure Segregation Diesel, Nonroad Diesel, and Tier 2 of the comment in EPA’s electronic of the 15 ppm Fuel To Avoid Gasoline Programs (70 FR 70498, public docket. The entire printed Contamination and Misfueling November 22, 2005).)

TABLE II.A–1.—FEDERAL IMPLEMENTATION DATES FOR HIGHWAY DIESEL FUEL 15 PPM STANDARD

Date Applicable parties

June 1, 2006 ...... Refiners and importers. September 1, 2006 ...... Downstream facilities except retailers and wholesale-purchaser con- sumers. October 15, 2006 ...... Retailers and wholesale-purchaser consumers.

These implementation dates begin the credits, which would allow them to instructions are discussed at length in a transition of the nation to ultra-low produce or import more than 20 percent later section of this rule. sulfur (15 ppm sulfur, maximum) of their diesel fuel to the 500 ppm sulfur From the beginning of the 500 ppm highway diesel fuel from the current standard until 2010. However, because highway diesel fuel program in 1993, low sulfur (500 ppm sulfur, maximum) of the sensitivity of the model year 2007 Alaska was exempted from both the 500 diesel fuel.1 Nationwide, until 2010, at and later highway engines and emission ppm highway diesel fuel sulfur standard least 80 percent of each refiner’s control systems to fuel with high sulfur and the non-highway dye provisions of production (or imports) must meet the content, those engines must not be 40 CFR 80.29 because of its unique 15 ppm sulfur standard, with the fueled with diesel fuel having a sulfur geographical, meteorological, air remaining 20 percent or less meeting the 2 content greater than 15 ppm. This quality, and economic factors. We 500 ppm sulfur standard—this is requires that all 500 ppm sulfur granted temporary exemptions for the commonly referred to as the 80/20 urban areas of the State served by the Temporary Compliance Option. highway diesel fuel (i.e., fuel from the Exceptions are made for EPA-approved 80/20 Temporary Compliance Option, credit-trading, or EPA-approved small 2 Under section 211(i)(4) of the Clean Air Act, the small refiners, which may produce all States of Alaska and Hawaii may be exempted from their highway fuel to the 500 ppm sulfur refiners) be segregated from the 15 ppm the 500 ppm sulfur content standard (and cetane, standard until later years, and refiners sulfur highway diesel fuel, labeled for aromatics and dye requirements) of section 211(i). its specific use, and dispensed, only in Copies of information regarding Alaska’s petition and importers that obtain early-use for exemption under section 211(i)(4), subsequent 2006 and earlier highway vehicles and requests by Alaska, public comments received, and 1 Alaska was granted an exemption from the 500 engines. Labeling requirements and action by EPA are available in public docket A–96– ppm standard until June 1, 2006. 26.

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Federal Aid Highway System, and a on factors unique to Alaska, we B. How Was Alaska Treated in the permanent exemption for the remaining provided the State with: (1) An NRLM Diesel Rule? State-defined rural areas. extension of the temporary exemption The nationwide implementation of On December 12, 1995, Alaska from the 500 ppm sulfur standard in the new sulfur requirements for nonroad, submitted a petition for a permanent urban areas until the implementation locomotive, and marine (NRLM) diesel exemption for all areas of the State date of the new 15 ppm sulfur standard fuel at 40 CFR 80.500 et seq. (69 FR served by the Federal Aid Highway for highway diesel fuel in 2006, (2) an 38958, June 29, 2004) begins June 1, System, that is, those areas previously opportunity to request an alternative 2007 for refiners and importers. This covered only by the temporary implementation plan for the 15 ppm implementation date begins the first exemption. While considering that sulfur diesel fuel program, and (3) a step of a two-step program of petition, we began work on a permanent exemption from the diesel transitioning the nation from nationwide rule to impose more fuel dye provisions. In that rule, our uncontrolled sulfur levels in non- stringent requirements for the sulfur goal was to establish a minimum cost highway diesel fuel to15 ppm sulfur content in highway diesel fuel. In the mechanism to make appropriate NRLM diesel fuel. In this first step, subsequent highway diesel final rule (66 modifications for transitioning Alaska to beginning in 2007, all NRLM diesel fuel FR 5002, January 18, 2001), we applied the ultra-low sulfur (15 ppm sulfur produced in or imported into the U.S. the complete highway engine emission maximum) highway diesel fuel program, must meet the 500 ppm sulfur standard standards in Alaska. The permanent while still ensuring that model year and applicable cetane or aromatic exemption from the 500 ppm sulfur 2007 and later highway vehicles and standards. Facilities downstream of the standard of 40 CFR 80.29 for rural engines receive the 15 ppm sulfur diesel refiners and importers must meet the Alaska terminates on the fuel they need. 500 ppm standard on subsequent dates implementation date of the new 15 ppm depending on location and facility type, sulfur standard in 2006. However, based as shown below:

TABLE II.B–1.—FEDERAL IMPLEMENTATION DATES FOR NRLM DIESEL FUEL 500 PPM STANDARD

Implementation date for urban Alaska and Northeast/Mid-Atlantic Implementation date for all other areas Applicable parties

June 1, 2007 ...... June 1, 2007 ...... Refiners and importers.* August 1, 2007 ...... August 1, 2010 ...... Downstream facilities except retailers and wholesale-purchaser consumers. October 1, 2007 ...... October 1, 2010 ...... Retailers and wholesale-purchaser consumers. December 1, 2007 ...... December 1, 2010 ...... All facilities including farm tanks and construc- tion facility tanks. * Other than small refiners and those with early-use credits.

Until June 1, 2010, EPA-approved heating oil) must be segregated from not be contaminated by dye. Therefore, small refiners/importers and refiners/ NRLM diesel fuel, dyed with a yellow the rule exempted Alaska from the dye importers with early-use credits can marker and red dye, and must not be and marker requirements, but in produce NRLM uncontrolled sulfur used in NRLM engines and equipment. exchange precluded the use of credits content diesel fuel (also uncontrolled As previously stated, the NRLM rule and constrained the flexibility granted aromatics content and cetane index), in requires that heating oil be segregated to small refiners.3 and marked with a yellow marker and most of the U.S. (the areas contained in Step two of the nationwide NRLM the Northeast/Mid-Atlantic Exclusion red dye to distinguish it from small refiner or credit-using NRLM high sulfur diesel fuel program implements the 15 Area, as defined in 40 CFR 80.510(g)(1)). content diesel fuel (40 CFR 80.510). ppm sulfur standard for nonroad diesel Until 2010, there is no restriction on the However, in that rule, we determined fuel beginning on June 1, 2010 for use of this EPA-approved small refiner/ that a dye requirement would impose a refiners and importers. Locomotive and importer NRLM uncontrolled sulfur significant challenge to Alaska’s unique marine diesel fuel produced or imported content diesel fuel in NRLM engines. distribution system, which cannot easily continues to be subject to the 500 ppm Nevertheless, according to this rule, as handle another fuel grade that must be sulfur standard until June 1, 2012. The it applies nationwide, other segregated. Apart from that challenge, downstream implementation dates for uncontrolled sulfur content diesel fuel the same transfer and storage facilities this second step are shown in Tables (i.e., all fuel meeting the definition of must accommodate jet fuel that must I.B–2 and I.B–3.

TABLE II.B–2.—FEDERAL IMPLEMENTATION DATES FOR NR DIESEL FUEL 15 PPM STANDARD

Implementation date for urban Alaska and Northeast/Mid-Atlantic Implementation date for all other areas Applicable parties

June 1, 2010 ...... June 1, 2010 ...... Refiners and importers.* August 1, 2010 ...... August 1, 2014 ...... Downstream facilities except retailers and wholesale-purchaser consumers. October 1, 2010 ...... October 1, 2014 ...... Retailers and wholesale-purchaser consumers.

3 For the small refiner flexibilities to be used in Administrator for a compliance plan (40 CFR Alaska a refined must first obtain approval from the 80.554(a)(4)).

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TABLE II.B–2.—FEDERAL IMPLEMENTATION DATES FOR NR DIESEL FUEL 15 PPM STANDARD—Continued

Implementation date for urban Alaska and Northeast/Mid-Atlantic Implementation date for all other areas Applicable parties

December 1, 2010 ...... December 1, 2014 All facilities including farm tanks and construction facility tanks. * Other than small refiners and those with early-use credits.

TABLE II.B–3.—FEDERAL IMPLEMENTATION DATES FOR LM DIESEL FUEL 15 PPM STANDARD

Implementation date for urban Alaska and Northeast/Mid-Atlantic Implementation date for all other areas Applicable parties

June 1, 2012 ...... June 1, 2012 ...... Refiners and importers. * August 1, 2012 ...... n/a ...... Downstream facilities except retailers and wholesale-purchaser consumers. October 1, 2012 ...... n/a ...... Retailers and wholesale-purchaser consumers. December 1, 2012 ...... n/a ...... All facilities including farm tanks and construc- tion facility tanks. * Other than small refiners and those with early-use credits.

Nationally, EPA-approved small The NRLM final rule stated that our remainder meeting the 500 ppm refiners/importers and refiners/ original proposal to permanently standard. The State requested that the importers, except in Alaska, with early- exempt all NRLM diesel fuel in rural rural areas be exempt from the use credits, as noted above, may Alaska from the sulfur content nationwide program from 2006 to 2010, produce or import nonroad diesel fuel standards was inconsistent with the and join the nationwide program in that meets the 500 ppm sulfur standard action requested by the State. As such, 2010 when all highway diesel fuel must until June 1, 2014. While the early-use this would have imposed the NRLM meet the 15 ppm standard. Thus, the credit provisions do not apply to sulfur content standards on all diesel rural areas would switch from Alaska, nevertheless, EPA-approved fuel in rural Alaska, including all the uncontrolled to 15 ppm sulfur for all small refiner/importers in Alaska may associated labeling, recordkeeping, and highway diesel fuel in 2010 along with produce 500 ppm sulfur content diesel reporting requirements. However, we the rest of the nation. Nevertheless, fuel for all approved uses until June 1, deferred imposing the sulfur content since all model year 2007 and later 2014. In addition, because of the standards, along with the labeling and highway diesel vehicles must use 15 sensitivity to fuel sulfur content of the recordkeeping, in order to coordinate ppm sulfur diesel fuel, fuel meeting this model year 2011 and later nonroad the NRLM with highway sulfur standard must be available in rural engines and emission control systems standards. This rule addresses those communities, in which, prior to 2010, that will be certified to the Tier 4 issues from the NRLM final rule raised there is one or more model year 2007 or emission standards, those engines must by the State for NRLM diesel fuel in the later highway vehicles. This approach not be fueled with diesel fuel having a rural areas, as well as the State’s provides rural Alaska more time to sulfur content greater than 15 ppm. suggestion for an alternative transition to the low sulfur fuel program Alaska submitted its suggested implementation plan for highway diesel in a manner that minimizes costs while modification of the highway diesel rule fuel in the rural areas. still ensuring that the model year 2007 for rural Alaska to the Agency on June and later highway vehicles receive the C. Alaska’s Submission and Comments 12, 2003, after publication of our NRLM low sulfur diesel fuel they need. in Response to NRLM Proposal proposal but before we had completed On September 15, 2003, Alaska the final NRLM rule. This suggested On June 12, 2003, Alaska submitted submitted its comments to the May 23, modification covered only highway its suggested modifications to the 2003 NRLM proposal. In those diesel for use in rural areas. Urban areas implementation of the highway diesel comments, Alaska asked us to bring the of Alaska were addressed in a previous fuel sulfur standards in Alaska. In its NRLM diesel fuel requirements for submission 4 for highway fuel and in plan, the State indicated that the rural Alaska in line with the State’s Alaska’s comments on the NRLM areas will not need the 15 ppm sulfur recommendations for highway diesel proposed rule. In both cases, the State diesel fuel in the early stage of the fuel, as described above. The State made of Alaska requested that urban areas highway diesel program. (The rural the following three requests, stressing adhere to the federal fuel sulfur areas are those areas not served by the the need to avoid the segregation of standards and implementation Federal Aid Highway System—which rural Alaska’s fuel stream: (1) The State schedule. The provisions for NRLM includes the marine highway system— previously requested that June 2010 be diesel fuel in urban Alaska, finalized in as defined by the State of Alaska.) If we the deadline for conversion to highway the NRLM final rule, require that NRLM implement a one-step, rather than a two- diesel fuel in the rural areas of Alaska; in urban areas meet the same step, transition to 15 ppm sulfur, the (2) it further requested that June 2010 be requirements as the contiguous 48 rural areas will have more time to plan the deadline for conversion of all NRLM states. the switch to 15 ppm sulfur diesel fuel, diesel fuel to 15 ppm sulfur content in which would lessen the overall impact. the rural areas; and, (3) it requested that 4 Letter from Michele Brown, Commissioner, The two-step transition would have the 15 ppm standard applicable to Alaska Department of Environmental Conservation, to Jeffrey R. Holmstead, Assistant Administrator of required a minimum of 80 percent of locomotive and marine diesel fuel the EPA’s Office of Air and Radiation, April 1, each refinery’s highway diesel to meet produced in, imported into, and 2002. the 15 ppm standard in 2006, with the distributed or used within rural Alaska

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be moved up to June 2010, from the ways the standards promulgated for III. What Is EPA Specifying for Rural June 2012 date in the final nationwide nonroad CI engines, including requiring Areas of Alaska? NRLM rule. non-emergency engines to meet Although it was outside the scope of standards likely to require sulfur- A. Highway Diesel Fuel this rule, Alaska also suggested that we sensitive aftertreatment beginning in With this rule, we are delaying the capture marine engines, locomotive 2011. In addition, the proposed NSPS implementation dates for the engines, and more engine sizes under included a requirement that all engines requirements of 40 CFR 80.500 et seq. the 15 ppm sulfur standard in the subject to the NSPS must use diesel fuel NRLM final rule, and that we allow the for highway diesel fuel produced in, meeting the 500 ppm sulfur standard imported into, and distributed or used State to continue to use dye-free diesel beginning October 1, 2007 and meeting within the rural areas of Alaska. We are fuel. Alaska also requested our financial the 15 ppm sulfur standard beginning also specifying that the rural areas of and technical assistance to perform a October 1, 2010.6 health study of diesel exhaust exposure Alaska join the rest of Alaska and the in rural Alaska because of concern about EPA received comment from entities nation in implementing the 15 ppm exposure to diesel exhaust from village in Alaska requesting that EPA allow sulfur content standard for highway electric power generators.5 similar exemptions for diesel fuel used diesel fuel on the final implementation by stationary engines in rural Alaska as date of the nationwide program in D. How Was Alaska Treated in the NSPS were expected to be proposed for NRLM 7 for New Stationary Diesel Engines 2010. These provisions were proposed fuel in rural Alaska. EPA subsequently in the Notice of Proposed Rulemaking On July 11, 2005, EPA proposed a proposed such exemptions in the (NPRM) for this rule, which published new source performance standard proposal for this rule. The final NSPS in the Federal Register on October 13, rule as not yet been completed, but it is (NSPS) applicable to stationary 2005 (70 FR 59690), and are being compression-ignition (i.e., diesel) expected to reference this issue and finalized today. The implementation engines manufactured on or after April discuss EPA’s agreement with the dates for our highway diesel fuel 1, 2006 and modified or reconstructed commenters. The exemptions in this after July 11, 2005 (70 FR 39869). The final rule are intended to resolve these requirements in the rural areas of Alaska proposed standards mirrored in many concerns. are shown in table III.A–1.

TABLE III.A–1.—IMPLEMENTATION DATES FOR HIGHWAY DIESEL FUEL 15 PPM STANDARD IN RURAL ALASKA

Date Applicable parties

June 1, 2010 ...... Refiners and importers. August 1, 2010 ...... Downstream facilities except retailers and wholesale-purchaser con- sumers. October 1, 2010 ...... Retailers and wholesale-purchaser consumers. December 1, 2010 ...... All facilities including farm tanks and construction facility tanks.

The dates shown in Table III.A–1 are applies nationwide, including the urban In its comments to the proposal for slightly different from the downstream areas of Alaska, in the 2006–2010 time this rule, the State expressed concern dates that mark the end of the frame. regarding how the implementation nationwide Temporary Compliance To fully implement the transition schedule may adversely impact the Option. We specified the above dates for program for rural Alaska, we are villages in rural Alaska. That is, that the highway diesel fuel because they are extending the current exemption from rule sets out distinct transition dates for more consistent with the downstream the 500 ppm sulfur standard of 40 CFR different applicable parties, including implementation dates associated with refiners and importers; downstream NRLM, as described in section III.B 80.29 until the implementation dates in 2010. Had we not included this facilities; retailers and wholesale below. purchasers; and tank farms, including extension, highway diesel fuel in the construction facility tanks. The State’s Prior to the dates shown in Table rural areas of Alaska would be required concern was that in a typical Alaskan III.A–1, rural areas of Alaska will to meet the 500 ppm sulfur standard of continue to be exempt from the sulfur village, many of these designations 40 CFR 80.29 beginning in 2006, when standards. However, that exemption, either do not exist or may all be the current exemption expires, notwithstanding, we require that diesel included in a combined entity. For fuel used in model year 2007 and later regardless of the proposed exclusion example, there may be a village or vehicles and engines meet the 15 ppm under 40 CFR 80.500 et al. However, villages in which fuel is pumped from sulfur content standard, because under this rule, highway diesel fuel a barge into a tank from which villagers emission control systems on those sulfur content will remain uncontrolled purchase fuel. Thus, it is arguable that engines are sensitive to fuel sulfur in rural Alaska until the implementation retail customers in such a rural village content. The same fueling requirement dates in 2010. could be forced into compliance as early

5 In the June 29, 2004 NRLM final rule, we The regulations promulgated in this rule exempt all diesel fuel meet the 15 ppm sulfur limit beginning applied the 15 ppm sulfur content standard to regulated stationary engines in rural Alaska from June 1, 2010, and that its locomotive and marine locomotive and marine diesel fuel, but not until the fuel provisions of the NSPS until December 1, diesel fuel meet the 15 ppm sulfur limit beginning June 1, 2012, and we exempted Alaska from the dye 2010, after which time all of the provisions of the June 1, 2012. If finalized as proposed, the sulfur and marker requirements. NSPS, including those particular regulations not requirements for highway and NRLM diesel fuel in 6 For purposes of this preamble, we are discussed in the preamble, apply. Canada will be harmonized with those of the U.S., simplifying the discussion of the fuel provisions of 7 Canada also requires 15 ppm sulfur highway the NSPS for stationary engines. There are different diesel fuel beginning June 1, 2006, and in October and this rule will have rural Alaska catch up to the regulations, for example, for stationary engines with 2004 proposed that its NRLM diesel fuel meet a 500 requirements in both the U.S. and Canada on June displacement greater than 30 liters per cylinder. ppm limit beginning June 1, 2007, its nonroad 1, 2010.

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as August 1, 2010, when in fact the last B. Nonroad, Locomotive, and Marine CFR 80.500 et seq. Also, due to the seasonal fuel barge typically doesn’t and Stationary Engine Diesel Fuel unique circumstances in rural Alaska arrive until October. Regarding this In the nonroad, locomotive and which limit the number of grades of concern and for this rule, we accept, as marine (NRLM) diesel final rule, we diesel fuel that can be stored and a single entity, any legally recognized covered urban Alaska along with the distributed, this rule further specifies combination (defined above as a rest of the nation, but held off finalizing that the 15 ppm sulfur standard ‘‘combined entity’’) of the downstream any provisions for rural Alaska so they applicable to locomotive and marine parties as listed in the above could be coordinated with those for the fuel (LM) be moved forward to 2010 to implementation table. The compliance highway diesel program in rural Alaska. be implemented at the same time as the date for the ‘‘combined entity’’ is to be This rule specifies that NRLM diesel 15 ppm sulfur standard for nonroad that date on which the ‘‘party or fuel produced in, imported into, and (NR) diesel fuel. In this way, there will member of the entity’’ listed at the latest distributed or used within the rural only be one grade of NRLM diesel fuel date on the implementation schedule is areas of Alaska is not subject to the in rural areas in 2010 and 2011 instead to be in compliance. For example, in requirements of 40 CFR 80.500 et seq., of the two separate grades (i.e. 15 ppm cases where there may be no combined until 2010. Thus, during the first step of and 500 ppm) that will be present entity, each party is expected to be in the nationwide program from June 1, elsewhere in the U.S. The compliance according to the schedule. 2007 until June 1, 2010, NRLM diesel implementation dates for the NRLM On the other hand, there may be cases fuel sulfur content will remain diesel fuel sulfur standards in rural in which all the downstream parties, uncontrolled in rural Alaska. Beginning Alaska are shown in Table II.B–1. All of including retail sales, are combined into June 1, 2010, nonroad diesel fuel in the provisions noted above that are single entities. In these cases, the rural Alaska will join the rest of Alaska being finalized in this rule were compliance date for the entities would and the nation in implementing the proposed on October 13, 2005 (70 FR be December 1, 2010. nonroad diesel fuel requirements of 40 59690).

TABLE III.B–1.—IMPLEMENTATION DATES FOR NRLM DIESEL FUEL 15 PPM STANDARD IN RURAL ALASKA

Date Applicable parties

June 1, 2010 ...... Refiners and importers. August 1, 2010 ...... Downstream facilities except retailers and wholesale-purchaser con- sumers. October 1, 2010 ...... Retailers and wholesale-purchaser consumers. December 1, 2010 ...... All facilities including farm tanks and construction facility tanks.

Similarly, diesel fuel used in engines Since the urban areas of Alaska will not be used in any model year 2007 or covered by the NSPS for diesel follow the nationwide schedule for later highway vehicles or engines, or in stationary engines in rural Alaska is sulfur standards, some 500 ppm LM fuel any model year 2011 or later nonroad or exempt from the requirements of 40 CFR will likely be available in these areas in stationary engines or equipment. 80.510 until December 1, 2010. the 2010–2012 timeframe, during which Beginning on December 1, 2010, all time nonroad and stationary engines C. Summary of Sulfur Standards for diesel fuel used in engines covered by requiring 15 ppm fuel will also likely be Alaska the stationary internal combustion present. We remind all those who will Table III.C–1 shows the Federal and engine NSPS (i.e., all stationary diesel be handling both 500 ppm and 15 ppm engines manufactured on or after April sulfur content fuel that model year 2011 Alaskan sulfur standards for highway 1, 2006 and all stationary diesel engines nonroad and stationary engines are and NRLM diesel fuel. Note that Alaska modified or reconstructed after July 11, prohibited from using the 500 ppm must ensure that model year 2007 and 2005) is subject to the requirements of sulfur content LM fuel. We wish to later highway engines and model year 40 CFR part 60, which is expected to further stress that although heating oil 2011 and later nonroad and stationary refer to the provisions of 40 CFR 80.510, will remain uncontrolled for sulfur source engines are only fueled with fuel as they apply to nonroad engines. content in all areas of Alaska, it must meeting the 15 ppm standard.

TABLE III.C–1.—SUMMARY OF FEDERAL AND ALASKAN SULFUR STANDARDS FOR DIESEL PRODUCTION AND IMPORTS [Parts per million]

Before 2007– 2010– Area Fuel 2006 2006 2009 2011 2012†

Federal ...... HW ...... 500 †‡15 ‡15 15 15 Urban Alaska ...... HW ...... none †‡15 ‡15 15 15 Rural Alaska ...... HW ...... none none none †15 15 Federal ...... NR ...... none none †500 †15 15 Urban Alaska ...... NR ...... none none †500 †15 15 Rural Alaska ...... NR ...... none none none †15 15 Federal ...... LM ...... none none †500 500 †15 Urban Alaska ...... LM ...... none none †500 500 †15 Rural Alaska ...... LM ...... none none none †15 15 † Refinery gate standard begins on June 1 of the first applicable year ‡ Temporary Compliance Option in effect: Up to 20% of a refinery’s production may exceed the 15 ppm standard so long as it meets the 500 ppm standard, is segregated from 15 ppm, and is not used in MY2007 and later engines.

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IV. Why Are We Specifying a June 1, decisions about whether to use only one diesel fuel dye provisions. As stated in 2010 Effective Date for Rural Areas of grade of diesel fuel (e.g., ultra low) or that rule and in this rule, our goal is to Alaska? build additional storage tanks to handle allow Alaska to transition to the 15 ppm Rural Alaska represented a rather two grades, one of which would be high sulfur standard for highway diesel fuel unique situation. The majority of sulfur fuel, to be used for space heating in a manner that minimizes costs while distillate fuel used in rural Alaska is for and unregulated power generation. In still ensuring that model year 2007 and stationary sources such as power addition, requiring rural areas to later highway vehicles and engines generation and home heating. The State provide 15 ppm diesel fuel for all NRLM receive the 15 ppm sulfur diesel fuel estimated that highway vehicles and regulated stationary applications they need. In its subsequent request for consume only about one percent of the beginning in 2010, rather than an alternative implementation plan for distillate fuel in the rural areas. exempting them permanently,9 helps the rural areas, the State indicated that ‘‘Heating oil’’ consumes approximately them avoid the temptation to misfuel the rural areas will have few, if any, 95 percent (about 50 percent for heating that may arise as the number of model model year 2007 and later highway and 45 percent for electricity year 2011 and later engines increases vehicles in the early stages of the generation) and marine engines and they are faced with the choice of highway diesel program, and thus consume the remaining five percent. either building additional tankage or would need little, if any, 15 ppm sulfur There is no significant consumption of using only 15 ppm fuel. diesel fuel during that time. The State also indicated that rural areas need other nonroad or locomotive diesel fuel A. Highway Diesel Fuel in rural Alaska. Thus, in rural Alaska, more time to plan the switch to 15 ppm only a very small proportion of the Under the highway diesel rule, at sulfur diesel fuel. We have reduced the distillate fuel used is currently regulated least 80 percent of a refinery’s highway overall impact of this fuel switch by for sulfur content (as well as aromatics diesel fuel production (except for that implementing a one-step, rather than a content and/or cetane index).8 A single produced by small refiners approved by two-step, transition to 15 ppm sulfur. grade of fuel is generally distributed to EPA under 40 CFR 80.550–80.553), There are about 600 highway diesel rural Alaska. It is usually downgraded must meet the ultra-low sulfur content vehicles with an average age of about 18 Jet A (which has a pour point of ¥50 standard (15 ppm sulfur, maximum) by years in the rural areas of Alaska. Many degrees) in order to ensure the fuel is 2006 (see Table I.A–1). The remaining replacement vehicles are typically pre- usable in arctic conditions. If we had highway diesel fuel must meet the low owned, and only about five to 15 new followed the nationwide requirements, sulfur content standard (500 ppm sulfur, diesel vehicles are brought into the rural either multiple grades of arctic grade maximum) and must not be used in areas each year.10 Thus, most of the fuel would have had to be transported model year 2007 and later highway approximately 250 rural area villages and stored for multiple uses, or else a diesel vehicles. These nationwide likely won’t obtain their first model year single grade of fuel meeting the 15 ppm standards and deadlines apply to all of 2007 or later diesel highway vehicle for standard would have had to be used by Alaska, including the rural areas. Since some time after 2007. everyone. The limited transportation the current fuel supply in rural Alaska According to the State, the fuel and storage capabilities in rural Alaska is primarily high sulfur, these storage and barge infrastructure in rural would have forced communities to nationwide requirements for highway Alaska is currently designed for one build additional infrastructure to handle fuel would have caused the highway grade of diesel fuel. Jet fuel, usually a multiple fuel grades. In order to provide fuel supply in rural Alaska to switch to high sulfur content fuel, is downgraded, a single grade of fuel meeting the 15 15 ppm sulfur diesel fuel, and possibly distributed, (and sometimes mixed with ppm standard, these small communities some to 500 ppm sulfur diesel fuel, in #1 diesel), sold, and used as #1 diesel would have been forced to pay a 2006. because it meets arctic specifications. premium for a fuel that was required for As previously discussed, Alaska has The efficiency and cost effectiveness of only a very small number of engines in been exempt from the sulfur and dye this system discourages the introduction the 2006 to 2010 timeframe. Either provisions of 40 CFR 80.29 since the of a small volume of a specialty fuel, approach could have caused significant beginning of the 500 ppm highway such as low or ultra-low sulfur highway economic hardship for the many rural diesel fuel program in 1993 because of diesel fuel. However, the rural hub communities which have primarily its unique geographical, meteorological, communities with jet service must subsistence economies. air quality, and economic factors. The continue to import jet fuel untainted by Our goal is to allow Alaska to rural areas are permanently exempt, and dye for aviation purposes. In the rural transition to the low sulfur fuel the urban areas are temporarily exempt. areas, fuel storage tanks are owned, programs in a manner that minimizes When we finalized the 15 ppm sulfur operated, and maintained by the costs while still ensuring that the small content standard for highway diesel communities. Thus, any new tankage or number of model year 2007 and later fuel, we recognized the factors unique to additional tank maintenance would highway vehicles and engines, and the Alaska and provided the State with: (1) have fallen directly on those rural small number of model year 2011 and An extension of the temporary communities, most of which have later nonroad and stationary engines exemption for the urban areas from the subsistence economies. and equipment certified to the Tier 4 500 ppm sulfur standard until the We agree with the State that a 2010 nonroad standards beginning with the implementation date of the new 15 ppm implementation date for rural Alaska is model year 2011, receive the 15 ppm sulfur standard for highway diesel fuel justified. We expect that the demand for sulfur content diesel fuel they need. By in 2006, (2) an opportunity to request an 15 ppm sulfur content fuel will be very coordinating the transition to 15 ppm of alternative implementation plan for the low in rural Alaska between 2006 and highway, NRLM, and regulated 15 ppm sulfur diesel fuel program, and 2010, because very few model year 2007 stationary engine fuels in 2010, rural (3) a permanent exemption from the and later highway diesel vehicles are communities can make individual expected there during those years. 9 The permanent exemption under the existing 8 Personal communication from Ron King, Alaska regulations still requires all model year 2011 and 10 Diesel vehicle registration data (12,000 pound Department of Environmental Conservation. July 2, later nonroad engines to be fueled with 15 ppm and greater, unladed weight) as of October 1998 2002. fuel. provided by the State of Alaska.

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Requiring the rural areas to comply with Based on a comment received in production or importation of 15 ppm the nationwide requirements for 15 ppm response to our NPRM, we learned that sulfur diesel fuel until June 1, 2010 for fuel 11 during the first step of the there are, in fact, marine facilities in the model year 2007 and later highway highway program (2006–2010) would some of the State-defined rural areas of vehicles in the rural areas should not be have imposed a significant economic Western Alaska, particularly along the a challenge. burden on Alaska’s rural communities Pribilof and Aleutian islands, which can The significant challenge in the rural to expand their distribution and storage handle more than one grade of fuel. areas is the distribution and storage systems without providing Under the regulations, small refiners/ infrastructure, which is currently corresponding environmental benefits. importers with access to such facilities designed to handle only one grade of We also agree that 2010 is an could continue to supply 500 ppm distillate fuel. The highway diesel rule appropriate time to implement a sulfur sulfur content fuel to such marine would have required changes to that content requirement for highway diesel facilities until June 1, 2014. We remind infrastructure in order to handle an fuel in the rural areas. As the number of those who handle both 500 ppm and 15 additional grade, including a shift to 15 model year 2007 and later highway ppm sulfur content fuels that they must ppm sulfur diesel fuel for all purposes, vehicles increases, the environmental be kept segregated, properly labeled, to occur by September 1, 2006. benefits from using 15 ppm sulfur diesel and sold only to legal end-users. However, under this rule, changes to the fuel will also increase. Extending the As discussed in the January 18, 2001 distribution and storage infrastructure, lead time for sulfur-controlled diesel Federal Register notice, any revisions to or a shift to 15 ppm sulfur diesel fuel fuel by an additional four years (from the final rule for highway diesel fuel in for all purposes, will not be required in 2006 to 2010) is adequate for the Alaska, must as a minimum: (1) Ensure rural areas until October 1, 2010. Thus, distributors and rural communities to an adequate supply (either through this rule grants the fuel distributors and make decisions on the most economical production or imports) of 15 ppm fuel villages in rural areas an additional four way to transition to sulfur-controlled to meet the demand of any model year years to make the necessary changes. highway diesel fuel, and to make any 2007 or later vehicles, (2) ensure However, they are still required to necessary capital improvements. sufficient retail availability of low sulfur supply 15 ppm sulfur fuel to all model Finally, 2010 marks the point in time at fuel for new vehicles in Alaska, (3) year 2007 and later highway vehicles which both the Temporary Compliance address the growth of supply and and engines. Option (TCO) for highway diesel fuel availability over time as more new Supplying 15 ppm sulfur diesel fuel ends and the requirement for 15 ppm vehicles enter the fleet, (4) include for model year 2007 and later diesel nonroad diesel fuel begins. Distribution measures to ensure segregation of the 15 vehicles until October 1, 2010 can be of diesel fuel to meet demand is ppm fuel and avoid contamination and accomplished several ways. A village obviously more efficient if the same misfueling, and (5) ensure fwith no model year 2007 or later diesel sulfur standards apply everywhere. As a enforceability. As discussed below, we vehicles or engines will not need the result, 2010 is an ideal year in which to believe the provisions in this rule meet new fuel and/or infrastructure changes transition rural Alaska to 15 ppm fuel in these criteria. until October 1, 2010. Nevertheless, if someone in a rural village does a single step. 1. Ensure an Adequate Supply (Either We do not require the use of 500 ppm purchase or otherwise operate one or Through Production or Imports) of 15 more model year 2007 or later highway sulfur highway diesel fuel as a ppm Sulfur Diesel Fuel To Meet the transition to 15 ppm fuel between June vehicles or engines, 15 ppm sulfur fuel Demand of Any Model Year 2007 or must be supplied by some means. One 1, 2006 and June 1, 2010. Such an Later Vehicles interim step would have created the suggestion is to ship the fuel in 55- Alaska has nearly 9000 highway same burden on Alaska’s distribution gallon drums; another is to modify the diesel vehicles. The fuel provided to system and rural communities as fuel infrastructure in order to handle a those vehicles in the areas served by the requiring 15 ppm sulfur highway diesel second fuel grade. A third option is for Federal Aid Highway System— fuel on June 1, 2006. As discussed in the village to shift to 15 ppm sulfur approximately 8400 vehicles—must more detail below, the primary issue of content fuel for all of its fuel needs. meet the requirements of the highway The first option—using 55-gallon requiring low sulfur highway diesel fuel rule, regardless of this rule. Other than drums—will likely have additional in rural Alaska was not whether there diesel fuel produced or imported by an transportation costs for shipping the was a source of the low-sulfur diesel EPA-approved small refiner/importer new fuel for the model year 2007 and fuel, nor whether the fuel might meet under 40 CFR 80.550–80.553, at least 80 later diesel vehicles, but the volume the 500 ppm or 15 ppm sulfur standard. percent of the fuel produced or will likely be low (only 20 to 60 of those The issue was that most of the imported into Alaska, must meet the 15 vehicles by the end of 2010 distributed distribution systems, including the ppm sulfur standard, beginning June 1, among the approximate 250 villages in storage tanks, were designed to handle 2006. The remainder of that fuel must rural Alaska). Thus, we expect that on a single fuel grade. To have required an meet the 500 ppm sulfur standard. average, the overall incremental cost of additional fuel grade would have Consumption of highway diesel fuel using this 55-gallon drums to supply imposed an unreasonable economic in the rural areas is about seven percent diesel fuel to rural Alaska will be burden on communities already of highway diesel fuel consumption in negligible. functioning under subsistence Alaska (assuming the same average The second option (changing the fuel economies. If we had imposed a vehicle consumption throughout the infrastructure to handle the additional transition of 500 ppm to 15 ppm sulfur state). Consumption of highway diesel fuel grade) will likely have the highest content highway diesel fuel on June 1, fuel by the five to 15 new vehicles per cost impact because the distributors 2006, rural Alaska would not have the year from 2007 through 2010 (for a total would need to split their barge relief provided by this rule. of 20 to 60 model year 2007 and later deliveries into multiple fuel grades, and vehicles by the end of 2010) will be a village would need multiple storage, 11 The first step of the nationwide highway program would require only 80% of each refinery’s much smaller—less than one percent of handling, and delivery systems. These production to meet the 15 ppm standard; the rest the highway diesel fuel consumption in modifications will cost money. If a must meet a 500 ppm standard. Alaska. Thus, under this rule, the village were to choose this option, we

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expect the choice would likely impact be very low for these vehicles in the the significant distribution limitations consumers by increasing the cost of all rural areas. Nevertheless, regardless of in rural areas, this was a critical need. fuels, not just the 15 ppm diesel. whether the small volume of this fuel This rule specifies one exception to While the third option (switching all for these vehicles prior to December 1, the nationwide NRLM standards and uses to 15 ppm sulfur diesel) would 2010 is stored in 55 gallon drums, in implementation deadlines in effect for avoid any incremental transportation, segregated tanks, or in village tanks, diesel fuel produced in, imported into, storage, and delivery systems costs, storing the additional incremental and distributed or used within rural nevertheless the 15 ppm sulfur fuel will volume for a few new vehicles will Alaska, beginning June 1, 2010. This likely cost more than the higher sulfur present no significant challenge. exception is that locomotive and marine fuel. Over the short term, this higher diesel fuel will also be required to meet fuel cost may be significant, especially 4. Include Measures To Ensure the 15 ppm sulfur content standard on compared to option one, in that heating Segregation of the 15 ppm Fuel and June 1, 2010 rather than in 2012. and electricity generation accounts for Avoid Contamination and Misfueling Rather than allowing the current about 95%, on average, of the distillate Under this rule, between 2006 and exemption to continue indefinitely, we consumption in a village. December 1, 2010, all segregation and believe that imposing the 15 ppm Under this rule, it is possible that all contamination avoidance measures that standard on all NRLM and regulated of the above options, or some apply nationwide to highway diesel stationary diesel fuel in rural Alaska is combination of them, will be found fuel, except for the dye requirements, both warranted and feasible. First, all prior to December 1, 2010 among the are applicable to diesel fuel used in highway diesel fuel, as well as all villages that need the fuel. In any case, model year 2007 and later highway NRLM diesel fuel and all diesel fuel for during this time period, we believe an vehicles and engines in the rural areas regulated stationary engines in urban adequate supply of 15 ppm sulfur diesel of Alaska. We do not believe any areas, must meet the 15 ppm standard fuel for all model year 2007 and later measures beyond these are necessary. by 2010. Given the limited ability of the vehicles and engines in the rural areas After 2010, all diesel fuel meeting the 15 distribution system for handling multiple grades, much (if not all) of the will not present a significant challenge. ppm standard must be segregated from NRLM diesel fuel in the rural areas will 2. Ensure Sufficient Retail Availability all other diesel fuel. After June 1, 2010 likely meet the 15 ppm standard even of Low Sulfur Fuel for New Vehicles in and until December 1, 2014, it is under the existing regulations. Second, Alaska incumbent upon all fuel handlers, we expect that the model year 2011 and especially those handling both 15 ppm Sufficient retail availability 12 is not later nonroad and stationary engines sulfur content fuel and 500 ppm sulfur an issue if adequate supply is provided will represent an increasing fraction of content fuel produced and/or to rural Alaska. Fuel deliveries to rural the nonroad and stationary fleet distributed by EPA-approved small Alaska are made to village tank farms beginning in 2010. Under the indefinite refiners, to assure that the 15 ppm sulfur (typically one tank farm per village). In exemption, rural communities would some cases, where villages have no content fuel is segregated from the small have had to decide when to switch their separate consumer tanks, pumps, or refiner fuel and that both fuels are NRLM fuel to only 15 ppm sulfur separate filling stations, the villagers dispensed to appropriate and legal end- content fuel. Under those conditions, withdraw fuel directly from the tank users, are properly labeled, and carry there may have been a temptation to farm. In villages with refueling locations appropriate transfer documents for all misfuel model year 2011 and later other than the village tank farm, the custody transfers other than retail sales. model year engines in order to avoid pumps are, nevertheless, usually filled 5. Ensure Enforceability making this switch. If misfueling had directly from the village tank farm. occurred for this or any other reason the Presumably, fuel deliveries in 55-gallon Under this rule, between 2006 and environmental benefits of the model drums will be delivered either to the December 1, 2010, all quality assurance year 2011 and later nonroad and village tank farm or directly to the measures (including testing and stationary engines would be vehicle owners. sampling) and enforcement provisions compromised. In addition, while pre- that apply nationwide to highway diesel 3. Address the Growth of Supply and 2007 highway engines and pre-2011 fuel, except for the dye requirements, nonroad and stationary engines are not Availability Over Time as More New are applicable to any diesel fuel used in Vehicles Enter the Fleet sensitive to high sulfur fuels, the direct model year 2007 and later highway environmental benefits from using Under this rule, and as required vehicles and engines in the rural areas lower sulfur fuel, including reduced nationwide, all diesel fuel for model of Alaska. We do not believe that any sulfur dioxide and diesel sulfate year 2007 and later highway diesel additional measures beyond these are particulate, would be lost if there were vehicles and engines in the rural areas necessary. an indefinite exemption. In summary, must meet the 15 ppm sulfur content B. NRLM and Stationary Diesel Fuel there are logistical and economic standard. As previously discussed, we benefits for coordinating the expect that from as few as 20 to as many As discussed above, under this rule, implementation of highway, NRLM, and as 60 model year 2007 and later diesel 15 ppm sulfur content highway diesel stationary 15 ppm sulfur standards in vehicles will arrive in Alaska between fuel must be in retail facilities in the urban and rural areas of Alaska and late 2006 and December 1, 2010, the rural areas by December 1, 2010. In with the rest of the nation. We believe date by which all highway diesel fuel in comments on the NRLM proposal, the that these benefits exceed the costs in the rural area retail facilities must meet State asked that we apply the rural Alaska. the 15 ppm sulfur content standard. nationwide NRLM fuel requirements to In response to our proposal, we Likewise, we expect that the demand for the rural areas beginning in 2010 received a comment expressing concern 15 ppm sulfur content diesel fuel will (except for the dye and marker about whether an EPA-approved small requirements). This approach allowed refiner’s status will be affected by the 12 For the purpose of this discussion concerning us to coordinate the highway, NRLM, June 1, 2010 NRLM rule as we have rural Alaska, we assume that retail availability means availability to the end user (e.g., diesel and regulated stationary diesel fuel described its implementation. That is, vehicle or engine owner/operator). requirements in the rural areas. Given whether an EPA-approved small refiner

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can produce, import, or otherwise highway diesel rule. The intent was for stationary engines, will be delayed as distribute 500 ppm NRLM diesel fuel for fuel distributors in Alaska to have the long as high sulfur diesel fuel is used, general use in other than model year same transition period as distributors in for the most part, no later than 2007 and later diesel vehicles and the rest of the country. Therefore, December 1, 2010. At that time, given engines between June 1, 2010 and mid- distributors would be allowed to remain the distribution limitations in rural 2014. As stated previously in this rule, at high sulfur until September 1 and Alaska, ULSD may also be used much ‘‘EPA-approved small refiners * * * retail outlets and wholesale purchaser- more broadly in locomotive, marine, may produce or import diesel fuel that consumers would be allowed to remain heating, and unregulated power meets the 500 ppm sulfur standard until at high sulfur until October 15. This generation services. If this is the case, June 1, 2014.’’ It should also be clear final rule is making this change to be there will be significantly greater sulfate that until June 1, 2014 EPA-approved consistent with the original intent of the PM benefits than strictly required. small refiners can distribute or highway diesel rule. Nevertheless, there is at least one EPA- otherwise sell 500 ppm sulfur content approved small refiner in Alaska that VI. What Is the Emissions Impact of NRLM diesel fuel for use in pre-model can produce, import, and distribute 500 This Rule? year 2007 diesel vehicles and engines as ppm sulfur content fuel for all uses well as for heating and, if the engine is The flexibility offered by this rule will other than highway use in Alaska or in unregulated, electrical generation. not increase diesel emissions over model year 2007 and later diesel However, along with all other rules and current levels, but will likely delay vehicles and engines, between restrictions that apply to small refiners, some sulfate emission reduction December 1, 2010 and June 1, 2014. we stress that the small refiner 500 ppm benefits in rural Alaska until 2010, Accordingly, to the extent this 500 ppm sulfur content NRLM diesel fuel can when low sulfur diesel fuel is more sulfur content fuel is used by legal end- only be sold to appropriate and legal widely used. The sulfate emissions of users, rather than the 15 ppm sulfur end-users and must be properly labeled pre-model year 2007 highway vehicles content that would otherwise be used, and segregated from all other fuels after and engines and of all marine engines the sulfate emissions benefit will be June 1, 2010. in rural Alaska will likely remain at reduced by a smaller amount. The NRLM final rule exempts all current levels until December 1, 2010. Nevertheless, we expect the net areas in Alaska from the red dye and Accordingly, where low sulfur fuel is difference will be quite small. yellow marker requirements, and any available, sulfate emissions will be Ultimately there will be benefits in segregation requirements that would reduced. terms of reduced PM (including sulfate otherwise apply for fuels meeting the The State of Alaska reported that PM), HC, sulfur dioxide, and NOX same sulfur, aromatics and/or cetane there are approximately 600 diesel emissions from highway, nonroad, and standards. Thus, in rural Alaska, prior highway vehicles distributed among stationary engines meeting the new to June 1, 2010, uncontrolled highway approximately 250 villages or rural standards, and required to use 15 ppm and non-highway diesel fuels can be communities. That is an average of fuel. commingled. To eliminate the need for fewer than three diesel vehicles per As in previous exemptions from the segregation, beginning June 1, 2010, village, although the absolute numbers 500 ppm sulfur standard, we will not highway and NRLM diesel fuels may be likely vary considerably between the order any vehicle or engine recalls commingled if both meet the 15 ppm smallest and largest villages. We believe based on emissions exceedances caused sulfur standard as well as applicable that if 15 ppm sulfur content fuel is by the use of high sulfur fuel (greater aromatics and/or cetane standards. The available for this small number of pre- than 500 ppm sulfur for pre-model year market will determine whether model year 2007 diesel highway 2007 vehicles and engines; greater than segregated or commingled distillate fuel vehicles, the sulfate emission reductions 15 ppm sulfur for model year 2007 and for highway, NRLM, and heating oil are will, nevertheless, be very small. On the later vehicles and engines) in rural available in any given area. other hand, the villages will receive the Alaska during the period prior to the full emission reduction benefits from implementation dates of this rule. Our V. Transition Dates for Urban Areas of any model year 2007 and later diesel testing goal is to establish whether Alaska highway vehicles fueled with 15 ppm properly maintained and operated As stated above in section II.A., under sulfur content diesel fuel that may be engines will meet emission standards the final highway diesel rule, provisions present. Once again, we don’t expect during their useful lives. This is were provided for the transition of the many of these late-model vehicles will consistent with the requirements for distribution system from 500 ppm diesel be present in the rural areas, so the recall specified in section 207(c)(1) of fuel to 15 ppm diesel fuel. These emissions reduction benefits will be the CAA. Further, manufacturers may provisions were recently modified such limited. have a reasonable basis for denying that refiners are required to begin We do not know the actual number of emission related warranties where producing 15 ppm highway diesel fuel NRLM equipment and engines in rural damages or failures are caused by the on June 1, 2006, while distributors are Alaska. However, we do know that the use of high sulfur fuel in rural Alaska. allowed until September 1, and retail consumption of distillate fuel in the In a comment to a previous proposal outlets and wholesale purchaser- rural areas by marine engines is about to grant Alaska a sulfur exemption, the consumers until October 15. A comment four percent, and that the fuel used for Engine Manufacturers Association was received from the State of Alaska other nonroad and locomotive engines expressed concern that the level of that the current language of the is negligible. We also know that fuel protection provided to engine regulations would essentially require used for power generation constitutes manufacturers falls short of what they that all parties downstream of the about 45 percent of total fuel used, but believe is reasonable and necessary. It refinery in Alaska would have to we do not know how many new asserted that the use of high sulfur transition to a 500 ppm standard by stationary engines regulated under the diesel fuel in an engine should raise a June 1 since they are currently NSPS will be installed in rural Alaska ‘‘ ‘rebuttable presumption’’’ that the fuel exempted from the 500 ppm standard prior to 2010, given the long life of such caused the engine to fail, and that the and are at a higher sulfur level. This was engines. Thus, sulfate emission benefits, EPA should have the burden of clearly not the intent of the final primarily from marine and new rebutting that presumption. It also

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asserted that an emissions warranty is a (3) Materially alter the budgetary amended ICR. The approved ICR for the regulatory requirement under section impact of entitlements, grants, user fees, nonroad final rule (ICR number 1718.05; 207, according to which, only the EPA or loan programs or the rights and OMB Control Number 2060–0308) has the authority to exclude claims obligations of recipients thereof; or, covers all U.S. states, including rural based on the use of high sulfur diesel (4) Raise novel legal or policy issues Alaska. For example, the fuel. arising out of legal mandates, the aforementioned nonroad ICR made an We understand and concur with the President’s priorities, or the principles addition to the existing diesel fuel manufacturers’ concerns about in-use set forth in the Executive Order.’’ regulations by explicitly defining testing of engines operated in an area It has been determined that this rule ‘‘diesel fuel’’ as fuel sold in any state or exempt from fuel sulfur requirements, is not a ‘‘significant regulatory action’’ territory of the U.S. In addition, product or as in the case of this rule, engines under the terms of Executive Order transfer documents, as required in the operated in an area with an 12866 and is therefore not subject to nonroad final rule, explicitly include implementation date later than that for OMB review. those to be used to identify fuel for use the rest of the country. Consequently, B. Paperwork Reduction Act in Alaska. Finally, the calculation of total information collection costs we affirm that, for recall purposes, we The Paperwork Reduction Act will not seek to conduct or otherwise associated with the nonroad final rule stipulates that every federal agency represented maximum costs and cause the in-use testing of engines we must obtain approval from the Office of know have been exposed to high sulfur included all areas of Alaska. As a result, Management and Budget (OMB) before the existing nonroad final rule ICR is fuels in rural Alaska. We believe we can collecting the same or similar readily obtain the necessary number of applicable for this rule. information from 10 or more members Burden means the total time, effort, or engines for our testing program by of the public. If the Environmental screening-out engines that were financial resources expended by persons Protection Agency decides to gather to generate, maintain, retain, or disclose operated in rural Alaska. Having information, the appropriate program or provide information to or for a reviewed the warranty concerns of the office must prepare an Information Federal agency. This includes the time Engine Manufacturers Association Collection Request (ICR) and submit it needed to review instructions; develop, regarding previous sulfur exemptions, to OMB for approval. An ICR describes acquire, install, and utilize technology we believe, as previously stated, that the information to be collected, gives and systems for the purposes of our position regarding warranties is the reason the information is needed, collecting, validating, and verifying consistent with section 207(a) and (b) of and estimates the time and cost for the information, processing and the CAA and does not require any new public to answer the request. maintaining information, and disclosing or amended regulatory language for OMB previously approved the ICRs and providing information; adjust the implementation. contained in the existing regulations at existing ways to comply with any The additional changes that this rule 40 CFR 80.500 et seq. and assigned previously applicable instructions and is making to clarify that fuel distributors OMB control number 2060–0308 and requirements; train personnel to be able and retailers and wholesale purchaser- EPA ICR numbers 1718.03 (dying of tax to respond to a collection of consumers in urban Alaska will follow exempt diesel fuel), 1718.04 (motor information; search data sources; the same transition period as the rest of vehicle diesel fuel), and 1718.05 (NRLM complete and review the collection of the country will not have any emissions diesel fuel). A copy of the OMB information; and transmit or otherwise impacts. These additions merely ensure approved ICRs may be obtained from disclose the information. that the original intent of the highway Susan Auby, Collection Strategies An agency may not conduct or diesel rule transition period is reflected Division; U.S. Environmental Protection sponsor, and a person is not required to in the regulations. Agency (2822T); 1200 Pennsylvania respond to a collection of information Ave., NW., Washington, DC 20460 or by VII. Statutory and Executive Order unless it displays a currently valid OMB calling (202) 566–1672. Reviews control number. The OMB control This rule does not establish any new numbers for EPA’s regulations in 40 A. Executive Order 12866: Regulatory requirements for highway diesel fuel CFR are listed in 40 CFR part 9. Planning and Review sold in Alaska, but instead only delays the requirements for 15 ppm fuel from C. Regulatory Flexibility Act Under Executive Order 12866, (58 FR 2006 to 2010 in rural areas of Alaska. EPA has determined that it is not 51735 (October 4, 1993)) the Agency Under this rule, reporting requirements necessary to prepare a regulatory must determine whether the regulatory in rural Alaska after 2010 will be exactly flexibility analysis in connection with action is ‘‘significant’’ and therefore the same as they are under the final this final rule. subject to OMB review and the highway diesel sulfur rule. The For purposes of assessing the impacts requirements of the Executive Order. previously approved ICR for highway of this rule on small entities, a small The Order defines ‘‘significant diesel fuel applies to rural Alaska. Thus entity is defined as: (1) A small business regulatory action’’ as one that is likely no new ICR or amended ICR is required as defined by the Small Business to result in a rule that may: for highway fuel. Administrations’ regulations at 13 CFR (1) Have an annual effect on the As the NRLM final rule did not 121.201; (2) a small governmental economy of $100 million or more or finalize the sulfur standards for rural jurisdiction that is a government of a adversely affect in a material way the Alaska, the requirements in this rule for city, county, town, school district or economy, a sector of the economy, NRLM diesel fuel in rural Alaska are special district with a population of less productivity, competition, jobs, the new. Nevertheless, according to the than 50,000; and (3) a small environment, public health or safety, or NRLM rule, all model year 2011 and organization that is any not-for-profit State, local, or tribal governments or later engines in rural Alaska must use enterprise which is independently communities; fuel meeting the 15 ppm diesel fuel owned and operated and is not (2) Create a serious inconsistency or sulfur content standard. However, these dominant in its field. otherwise interfere with an action taken new requirements for NRLM diesel fuel After considering the economic or planned by another agency; in rural Alaska do not require a new or impacts of this final rule on small

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entities, EPA has concluded that this unlikely to create an additional duty on any State, local, or tribal action will not have a significant economic burden for rural areas. governments or on the private sector, economic impact on a substantial Lastly, the additional changes that and does not contain a Federal mandate number of small entities. this rule is making to clarify that fuel that results in expenditures of $100 This rule delays the implementation distributors and retailers and wholesale million or more for State, local, and date for ultra-low sulfur highway diesel purchaser-consumers in urban Alaska tribal governments, in the aggregate, or fuel in rural Alaska compared to the will follow the same transition period as for the private sector in any one year. existing regulations and extends the the rest of the country (following the Rather, this rule: (1) Relieves burden by same deadline to NRLM diesel fuel in request from the State of Alaska) will applying a delayed implementation date rural Alaska to bring those areas in line not have any emissions impacts. These for ultra-low sulfur highway, nonroad, with the national standards. Since this additions merely ensure that the locomotive and marine diesel fuel in rule delays the 15 ppm highway sulfur original intent of the highway diesel rural Alaska compared to the existing standard in rural areas, the regulatory rule transition period is reflected in the regulations and the rest of the country; burden is effectively relieved. regulations. and, (2) clarifies that fuel distributors Regarding NRLM diesel fuel in D. Unfunded Mandates Reform Act and retailers and wholesale purchaser- Alaska, the requirements in this rule are consumers in urban Alaska will follow Title II of the Unfunded Mandates the same transition period as the rest of new in that rural areas of Alaska need Reform Act of 1995 (UMRA), Public not switch to the15 ppm diesel fuel the country, as was the intent of the Law 104–4, establishes requirements for highway diesel final rule. Thus, this sulfur content standard as specified in Federal agencies to assess the effects of the NRLM final rule. It was our stated rule is not subject to the requirements their regulatory actions on State, local, of sections 202 and 205 of the UMRA. intention in that rule that all of Alaska, and tribal governments and the private including the rural areas, switch to 15 sector. Under section 202 of the UMRA, E. Federalism ppm sulfur diesel fuel content fuel at EPA generally must prepare a written Executive Order 13132, entitled the time specified in the NRLM final statement, including a cost-benefit ‘‘Federalism’’ (64 FR 43255, August 10, rule. However, as previously explained, analysis, for proposed and final rules 1999), requires EPA to develop an we deferred that action in order to with ‘‘Federal mandates’’ that may accountable process to ensure coordinate the implementation of result in expenditures to State, local, ‘‘meaningful and timely input by State highway and NRLM diesel fuel in rural and tribal governments, in the aggregate, and local officials in the development of Alaska. or to the private sector, of $100 million regulatory policies that have federalism Even though the NRLM sulfur or more in any one year. Before implications.’’ ‘‘Policies that have standards in this rule are new, they do promulgating an EPA rule for which a federalism implications’’ is defined in not impose a significant economic written statement is needed, section 205 the Executive Order to include impact on a significant number of small of the UMRA generally requires EPA to regulations that have ‘‘substantial direct entities. The distribution and storage identify and consider a reasonable effects on the States, on the relationship system limits the number of grades of number of regulatory alternatives and between the national government and diesel fuel that can be stored and adopt the least costly, most cost- the States, or on the distribution of distributed within the approximately effective or least burdensome alternative power and responsibilities among the 250 rural area villages in Alaska. This that achieves the objectives of the rule. various levels of government.’’ discourages the introduction of a small The provisions of section 205 do not This rule does not have federalism volume of a specialty fuel, generally apply when they are inconsistent with implications. It does not have forcing these communities to choose applicable law. Moreover, section 205 substantial direct effects on the States, between using a single fuel for all diesel allows EPA to adopt an alternative other on the relationship between the national applications, or purchasing extra storage than the least costly, most cost-effective government and the States, or on the and distribution equipment. The latter or least burdensome alternative if the distribution of power and approach is generally more expensive Administrator publishes an explanation responsibilities among the various and would likely be pursued only if the with the final rule of why that levels of government, as specified in equipment would be needed in the long alternative was not adopted. Before EPA Executive Order 13132. This rule simply term. On the other hand, we believe that establishes any regulatory requirements applies a delayed implementation date after 2010 an increasingly greater that may significantly or uniquely affect for low sulfur highway diesel fuel in the proportion of the fuel inventory in an small governments, including tribal rural areas of Alaska, and provides a average rural village will need to meet governments, it must have developed delayed implementation date for the 15 ppm standard, as the number of under section 203 of the UMRA a small inclusion of rural Alaska in the model year 2011 and later stationary, government agency plan. The plan must nationwide nonroad, locomotive and nonroad and marine engines in these provide for notifying potentially marine (NRLM) diesel fuel program. villages is expected to increase. Thus, in affected small governments, enabling Thus, Executive Order 13132 does not the long term, segregated storage and officials of affected small governments apply to this rule. Although section 6 of distribution capacity would become to have meaningful and timely input in Executive Order 13132 does not apply unnecessary. In addition, since the the development of EPA regulatory rules to this rule, EPA did consult with highway fuel in rural areas will already with significant Federal representatives of the State of Alaska, be 15 ppm sulfur standard diesel fuel by intergovernmental mandates, and who spent much time gathering 2010, we believe many rural informing, educating, and advising feedback from the rural communities communities will simply switch to 15 small governments on compliance with about our highway and NRLM diesel ppm sulfur standard diesel for all uses, the regulatory requirements. fuel requirements. In fact, this rule is an rather than install additional storage This rule contains no Federal alternative implementation plan for low and distribution capacity. This rule’s mandates (under the regulatory sulfur highway diesel fuel in rural requirement that all NRLM diesel fuel provisions of Title II of the UMRA) for Alaska that resulted directly from, and used in rural areas meet the 15 ppm State, local, or tribal governments or the is consistent with State submittals to standard starting in 2010 is therefore private sector. It imposes no enforceable EPA, as well as with comments to the

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proposed NRLM diesel rule as it relates disproportionate effect on children. If J. Congressional Review Act to rural Alaska, as previously mentioned the regulatory action meets both criteria, in this preamble. Nevertheless, in the the Agency must evaluate the The Congressional Review Act, 5 spirit of Executive Order 13132, and environmental health or safety effects of U.S.C. 801 et seq., as added by the Small consistent with EPA policy to promote the planned rule on children, and Business Regulatory Enforcement communications between EPA and State explain why the planned regulation is Fairness Act of 1996, generally provides and local governments, we specifically preferable to other potentially effective that before a rule may take effect, the solicited comment on this rule from and reasonably feasible alternatives agency promulgating the rule must State and local officials. considered by the Agency. submit a rule report, which includes a copy of the rule, to each House of the F. Consultation and Coordination With We do not believe this rule presents Congress and to the Comptroller General Indian Tribal Governments disproportionate environmental health of the United States. EPA will submit a Executive Order 13175, entitled or safety risks to children, nor do we report containing this rule and other ‘‘Consultation and Coordination with believe it is economically significant. required information to the U.S. Senate, Indian Tribal Governments’’ (65 FR Therefore, this rule is not subject to the U.S. House of Representatives, and 67249, November 9, 2000), requires EPA Executive Order 12866. This rule will the Comptroller General of the United to develop an accountable process to affect only highway diesel fuel sold in States prior to publication of the rule in ensure ‘‘meaningful and timely input by rural areas of Alaska which have unique the Federal Register. A major rule tribal officials in the development of meteorological conditions and sparse cannot take effect until 60 days after it regulatory policies that have tribal populations that make environmental is published in the Federal Register. implications.’’ health and safety risks highly unlikely This action is not a ‘‘major rule’’ as This rule does not have tribal and it clarifies the dates of the transition defined by 5 U.S.C. 804(2). This rule implications as specified in Executive period for distributors and retailers/ will be effective July 6, 2006. Order 13175. The regulations this rule wholesale purchaser-consumers in VIII. Statutory Provisions and Legal amends will be implemented at the urban Alaska. Authority Federal level and impose compliance We invited the public to submit or costs only on diesel fuel producers, identify peer-reviewed studies and data The statutory procedural authority importers, distributors, retailers and that assessed results of early-life under which this rule is being consumers of diesel fuel. This rule exposure to the sulfur-based emissions promulgated is found in section 307(d) relates to the standards and deadlines (primarily SO2) addressed by this rule, of the Clean Air Act and section 4 of the that apply specifically to the rural areas of which we may not have been aware. Administrative Procedure Act. Statutory of Alaska, and tribal governments in the authority for this rule is also found in rural areas of Alaska will be affected H. Executive Order 13211: Actions That sections 211(c) and 211(i) of the CAA, only to the extent that they or their Significantly Affect Energy Supply, which directs EPA to regulate fuels that constituents purchase and use diesel Distribution, or Use either contribute to air pollution which fuel. This rule is not subject to Executive endangers public health or welfare or We specifically solicited additional Order 13211, ‘‘Actions Concerning which impair emission control comment on this rule from tribal Regulations That Significantly Affect equipment which is in general use or officials. Also, in order for tribal Energy Supply, Distribution, or Use’’ (66 has been in general use. 42 U.S.C. officials to provide us with meaningful FR 28355 (May 22, 2001)) because it is 7545(c) and (i). Additional support for and timely input, State representatives not a significant regulatory action under the procedural and enforcement-related consulted with them early in the Executive Order 12866. aspects of fuel controls, including process of developing this regulation. recordkeeping requirements, comes State representatives spent much time I. National Technology Transfer and from sections 114(a) and 301(a) of the gathering feedback about our highway Advancement Act CAA. 42 U.S.C. 7414(a) and 7601(a). and NRLM diesel fuel requirements from representatives of both rural and Section 12(d) of the National List of Subjects in 40 CFR Part 69 Technology Transfer and Advancement tribal communities. The State gave full Environmental protection, Air Act of 1995 (‘‘NTTAA’’), Public Law consideration to that feedback in their pollution control. request to EPA for an alternative 104–113, section 12(d) (15 U.S.C. 272 implementation plan for low sulfur note) directs EPA to use voluntary Dated: May 25, 2006. highway diesel fuel in rural Alaska. consensus standards in its regulatory Stephen L. Johnson, Likewise, the State gave full activities unless to do so would be Administrator. inconsistent with applicable law or consideration to that feedback in their I For the reasons set out in the otherwise impractical. Voluntary comments to the proposed NRLM diesel preamble, part 69 of title 40 of the Code consensus standards are technical rule as it relates to rural Alaska, as of Federal Regulations is amended as standards (e.g., materials specifications, mentioned previously in this preamble. follows: test methods, sampling procedures, and G. Protection of Children From business practices) that are developed or Environmental Health & Safety Risks PART 69—SPECIAL EXEMPTIONS adopted by voluntary consensus FROM THE REQUIREMENTS OF THE Executive Order 13045: ‘‘Protection of standards bodies. The NTTAA directs CLEAN AIR ACT Children from Environmental Health EPA to provide Congress, through OMB, Risks and Safety Risks’’ (62 FR 19885, explanations when the Agency decides I 1. The authority citation for part 69 April 23, 1997) applies to any rule that: not to use available and applicable continues to read as follows: (1) Is determined to be ‘‘economically voluntary consensus standards. This Authority: 42 U.S.C. 7545(c), (g) and (i), significant’’ as defined under Executive proposed rulemaking does not involve and 7625–1. Order 12866, and (2) concerns an technical standards. Therefore, EPA did environmental health or safety risk that not consider using any voluntary I 2. Section 69.51 is revised to read as EPA has reason to believe may have a consensus standards. follows:

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§ 69.51 Motor vehicle diesel fuel. System, and is used in areas of Alaska I d. By revising paragraph (g). (a) Definitions. (1) Areas accessible by not accessible by the Federal Aid I e. By adding a new paragraph (h). the Federal Aid Highway System are the Highway System, is exempt from the geographical areas of Alaska designated sulfur standard of 40 CFR 80.29(a)(1), § 69.52 Non-motor vehicle diesel fuel. by the State of Alaska as being the dye provisions of 40 CFR 80.29(a)(3) (a) * * * accessible by the Federal Aid Highway and (b), and the motor vehicle diesel (4) Heating oil has the meaning given System. fuel standards and dye provisions under in 40 CFR 80.2. (2) Areas not accessible by the Federal 40 CFR 80.520 and associated * * * * * Aid Highway System are all other requirements, provided that: (c) * * * geographical areas of Alaska. (1) The exempt fuel is not used in (1) NRLM diesel fuel and heating oil (b) Diesel fuel that is designated for model year 2007 and later highway referred to in paragraphs (b) and (g) of use only in Alaska and is used only in vehicles and engines, this section are exempt from the red dye Alaska, is exempt from the sulfur (2) The exempt fuel is segregated from requirements, and the presumptions standard of 40 CFR 80.29(a)(1), the dye nonexempt highway diesel fuel from the associated with the red dye provisions of 40 CFR 80.29(a)(3) and (b) point of such designation; and requirements, under 40 CFR and the motor vehicle diesel fuel (3) On each occasion that any person 80.520(b)(2) and 80.510(d)(5), (e)(5), and standards and dye provisions under 40 transfers custody or title to the exempt (f)(5). CFR 80.520 and associated requirements fuel, except when it is dispensed at a (2) NRLM diesel fuel and heating oil until the implementation dates of 40 retail outlet or wholesale purchaser- referred to in paragraphs (b) and (g) of CFR 80.500 for refiners and importers, consumer facility, the transferor must this section are exempt from the marker until September 1, 2006 for all provide to the transferee a product solvent yellow 124 requirements, and downstream parties other than retailers transfer document stating: ‘‘This fuel is the presumptions associated with the and wholesale purchaser-consumers, for use only in those areas of Alaska not marker solvent yellow 124 and until October 15, 2006 for retailers accessible by the FAHS.’’ requirements, under 40 CFR 80.510(d) and wholesale purchaser-consumers, (4) The exempt fuel must meet the through (f). provided that: labeling requirements under § 80.570, * * * * * (1) The fuel is segregated from except the following language shall be (f) Non-motor vehicle diesel fuel and nonexempt diesel fuel from the point of substituted for the language on the heating oil that is intended for use and such designation; labels: (2) On each occasion that any person used only in areas of Alaska not transfers custody or title to the fuel, ‘‘HIGH SULFUR DIESEL FUEL (may be accessible by the Federal Aid Highway except when it is dispensed at a retail greater than 15 Sulfur ppm) System, are excluded from the applicable provisions of 40 CFR part 80, outlet or wholesale purchaser-consumer WARNING facility, the transferor must provide to subpart I and 40 CFR part 60, subpart Federal Law prohibits use in model year 2007 IIII until the implementation dates the transferee a product transfer and later highway diesel vehicles and document stating: ‘‘This diesel fuel is specified in paragraph (g) of this engines. Its use may damage these vehicles section, except that: for use only in Alaska. It is exempt from and engines.’’ the federal low sulfur standards (1) All model year 2011 and later applicable to highway diesel fuel and (e) Beginning on the following nonroad and stationary diesel engines red dye requirements applicable to non- implementation dates, motor vehicle and equipment must be fueled only highway diesel fuel only if it is used in diesel fuel that is designated for use in with diesel fuel that meets the Alaska.’’; and, areas of Alaska not accessible by the specifications for NR fuel in 40 CFR (3) After June 1, 2006 and prior to the Federal Aid Highway System, or is used 80.510(b) or (c); implementation dates specified above, in areas of Alaska not accessible by the (2) The following language shall be diesel fuel represented by a downstream Federal Aid Highway System, is subject added to any product transfer party as meeting the 500 ppm sulfur to the applicable provisions of 40 CFR document: ‘‘This fuel is for use only in standard or the 15 ppm sulfur standard part 80, subpart I, except as provided those areas of Alaska not accessible by for highway diesel fuel shall be subject under 40 CFR 69.52(c), (d), and (e) for the FAHS;’’ and to and must meet such standard. commingled motor vehicle and non- (3) Pump labels for such fuel that does (c) Beginning on the implementation motor vehicle diesel fuel: not meet the specifications of 40 CFR dates specified in paragraph (b) of this (1) June 1, 2010 for diesel fuel 80.510(b) or 80.510(c) shall contain the section, motor vehicle diesel fuel that is produced or imported by any refiner or following language: designated for use in areas of Alaska importer; accessible by the Federal Aid Highway (2) August 1, 2010 at all downstream ‘‘HIGH SULFUR DIESEL FUEL (may be greater than 15 Sulfur ppm) System, or is used in areas of Alaska locations, except at retail outlets and accessible by the Federal Aid Highway wholesale-purchaser consumers; WARNING System, is subject to the applicable (3) October 1, 2010 for: Federal Law prohibits use in model year 2007 provisions of 40 CFR part 80, subpart I, (i) Retail outlets and wholesale- and later highway diesel vehicles and except as provided under 40 CFR purchaser consumers, or engines, or in model year 2011 and later 69.52(c), (d), and (e) for commingled (ii) Downstream locations which nonroad and stationary diesel engines and motor vehicle and non-motor vehicle include retail outlets and wholesale- equipment. Its use may damage these diesel fuel. purchaser consumers; and, vehicles and engines.’’ (d) From the implementation dates (4) December 1, 2010 at all locations. (g) NRLM and stationary engine specified in paragraph (b) of this I 3. Section 69.52 is amended as standards. (1) Beginning on the section, until the implementation dates follows: following implementation dates, NRLM specified in paragraph (e) of this I a. By adding a new paragraph (a)(4). diesel fuel that is used or intended for section, motor vehicle diesel fuel that is I b. By revising paragraphs (c)(1) and use in areas of Alaska not accessible by designated for use in areas of Alaska not (c)(2). the Federal Aid Highway System is accessible by the Federal Aid Highway I c. By revising paragraph (f). subject to the provisions of 40 CFR part

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80, subpart I, except as provided in currently subject to Toxics Release Ave., NW., Washington, DC. The Public paragraphs (c), (d), (e), and (g)(2) of this Inventory (TRI) reporting requirements Reading Room is open from 8:30 a.m. to section: in order to facilitate the transition from 4:30 p.m., Monday through Friday, (i) June 1, 2010 or diesel fuel reporting of SIC codes on TRI reporting excluding legal holidays. The telephone produced or imported by any refiner or forms to reporting of NAICS codes. number for the Public Reading Room is importer, Consistent with the language of section (202) 566–1744, and the telephone (ii) August 1, 2010 at all downstream 313(b)(1)(A) of the Emergency Planning number for the OEI Docket is (202) 566– locations, except at retail facilities and and Community Right-to-Know Act of 1752. wholesale-purchaser consumers, 1986 (EPCRA), SIC codes still remain in FOR FURTHER INFORMATION CONTACT: For (iii) October 1, 2010 at retail facilities the regulatory text as a basis for general information on TRI, contact the and wholesale-purchaser consumers, identifying the facilities that are subject Emergency Planning and Community and to TRI requirements, along with the new Right-to-Know Hotline at (800) 424– (iv) December 1, 2010 at all locations. NAICS codes. (2) The per-gallon sulfur content EPA conducted a careful crosswalk 9346 or (703) 412–9810, TDD (800) 553– standard for all LM diesel fuel shall be between the SIC codes covered under 7672, http://www.epa.gov/epaoswer/ 15 ppm maximum. EPCRA section 313 and section 6607 of hotline/. For specific information on (3) Diesel fuel used in new stationary the Pollution Prevention Act (PPA) and this rulemaking contact: Judith Kendall, internal combustion engines regulated their corresponding NAICS codes. The Toxics Release Inventory Program under 40 CFR part 60 shall be subject Agency believes it has correctly Division, Mail code 2844T, OEI, to the fuel-related provisions of that identified the covered NAICS codes and Environmental Protection Agency, Ariel subpart beginning December 1, 2010. no longer expects facilities to identify Rios Building, 1200 Pennsylvania Ave., (h) Alternative labels to those their SIC codes to determine TRI NW., Washington, DC 20460, specified in paragraphs (e)(3) and (f)(2) Program compliance. Facilities may Telephone: 202–566–0750; Fax: 202– of this section may be used as approved now rely on the list of covered NAICS 566–0741; e-mail address: by EPA. codes to determine whether they are [email protected]. [FR Doc. 06–5053 Filed 6–5–06; 8:45 am] required to report to the TRI Program. SUPPLEMENTARY INFORMATION: DATES BILLING CODE 6560–50–P : This final rule is effective on August 7, 2006. Facilities will be I. General Information required to report NAICS codes A. Does This Action Apply to Me? ENVIRONMENTAL PROTECTION beginning with TRI reporting forms that AGENCY are due on July 1, 2007, covering Entities that may be affected by this releases and other waste management action are those facilities that have 10 or 40 CFR Part 372 quantities at the facility for the 2006 more full-time employees or the calendar year. equivalent 20,000 hours per year that [EPA–HQ–TRI–2002–0003; FRL–8180–2] ADDRESSES: EPA has established a manufacture, process, or otherwise use RIN 2025–AA10 docket for this action under Docket ID toxic chemicals listed on the TRI, and No. EPA–HQ–TRI–2002–0003. All that are required under section 313 of Community Right-to-Know; Toxic documents in the docket are listed on EPCRA and section 6607 of the PPA to Chemical Release Reporting Using the www.regulations.gov Web site. report annually to EPA and States their North American Industry Classification Although listed in the index, some environmental releases and other waste System (NAICS); Final Rule information is not publicly available, management quantities of such AGENCY: Environmental Protection e.g., Confidential Business Information chemicals. Under Executive Order Agency (EPA). (CBI) or other information whose 13148, revised April 26, 2000 (65 FR 24599), all Federal facilities are required ACTION: Final rule. disclosure is restricted by statute. Certain other material, such as to comply with the provisions set forth SUMMARY: EPA has determined it is copyrighted material, is not placed on in section 313 of EPCRA and section appropriate to amend its regulations for the Internet and will be publicly 6607 of the PPA. Federal facilities are the Toxics Release Inventory (TRI) to available only in hard copy form. required to comply with those include the North American Industry Publicly available docket materials are provisions without regard to SIC or Classification System (NAICS) codes. available either electronically through NAICS delineations. We are including the NAICS codes that www.regulations.gov or in hard copy at Potentially affected categories and correspond to the Standard Industrial the HQ EPA Docket Center, EPA West entities may include, but are not limited Classification (SIC) codes that are Building, Room B102, 1301 Constitution to:

Category Examples of potentially affected entities

Industry ...... SIC major group codes 10 (except 1011, 1081, and 1094), 12 (except 1241), or 20 through 39; industry codes 4911, 4931, or 4939 (limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in commerce); or 4953 (limited to facilities regulated under the Resource Conserva- tion and Recovery Act, subtitle C, 42 U.S.C. 6921 et. seq.), or 5169, or 5171, or 7389 (limited to facilities primarily engaged in solvent recovery services on a contract or fee basis). Federal Government ...... Federal facilities.

This table is not intended to be entities not listed in the table could also applicability criteria in part 372, subpart exhaustive, but rather provides a guide be affected. To determine whether your B of Title 40 of the Code of Federal for readers regarding entities likely to be facility is affected by this action, you Regulations. If you have any questions affected by this action. Other types of should carefully examine the regarding the applicability of this action

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to a particular entity, consult the person For the purpose of establishing classified in an applicable SIC code. 42 listed in the FOR FURTHER INFORMATION consistency with the NAICS U.S.C. 11023(b)(1)(A); 40 CFR 372.22. CONTACT section. classification methodology, and to avoid Information collected pursuant to confusion in the future with respect to section 313 of EPCRA and section 6607 II. What Is EPA’s Statutory Authority reporting obligations by establishments of PPA is organized into the national for Taking This Action? that are considered auxiliary TRI data base which is readily EPA is finalizing this action under establishments under the SIC system, accessible to the public, researchers, sections 313(g)(1) and 328 of EPCRA, 42 EPA is changing its interpretation that industry, government agencies, and U.S.C. 11023(g)(1) and 11048. EPCRA is EPCRA reporting requirements apply to other interested parties. also referred to as Title III of the auxiliary establishments. EPA believes When Congress enacted EPCRA in Superfund Amendments and this change is warranted in light of the 1986, it specifically identified the Reauthorization Act of 1986 (SARA) significant differences in treatment of manufacturing sector, which included (Pub. L. 99–499). In general, section 313 auxiliary establishments between the facilities in SIC major group codes 20 of EPCRA requires owners and operators SIC and NAICS systems. It is possible, through 39 (see Executive Office of the of facilities in specified SIC codes that in light of EPA’s new interpretation, that President, Office of Management and manufacture, process, or otherwise use some auxiliary establishments will no Budget, Standard Industrial a listed toxic chemical in amounts longer be subject to TRI reporting Classification Manual 1987 (hereinafter above specified threshold levels to requirements. EPA is also amending the referred to as the 1987 SIC Manual), as report certain facility specific regulations to extend the exemption being subject to the reporting information about such chemicals, provided in the regulations to owners of requirements of section 313. Section including the annual releases and other covered facilities who lease, with no 313(b)(1)(A) states: waste management quantities. Section other business interest, such facilities to 313(g)(1) of EPCRA requires EPA to operators of establishments that are The requirements of this section shall publish a uniform toxic chemical classified in any SIC code or NAICS apply to owners and operators of facilities release form for these reporting code that is subject to TRI requirements. that have 10 or more full time employees and purposes, and it also prescribes, in The TRI regulations currently exempt that are in Standard Industrial Classification Codes 20 through 39 (as in effect on July 1, general terms, the types of information from TRI reporting requirements that must be submitted on the form. 1985) and that manufactured, processed or ‘‘owners of facilities such as industrial otherwise used a toxic chemical listed under Section 313(g)(1)(A) requires owners parks, all or part of which are leased to and operators of facilities that are subsection (c) of this section in excess of the persons who operate establishments quantity of that chemical established under subject to section 313 requirements to within SIC code 20 through 39 where subsection (f) of this section during the report the principal business activities the owner has no other business interest calendar year for which a release form is at the facilities. However, Congress in the operation of the covered facility.’’ required under this section. provided no guidance as to how such EPA believes it is appropriate to extend In addition, in 1997, pursuant to activities should be described. In the this exemption to owners of facilities past, EPA has required owners and section 313(b)(1)(B), EPA added seven that lease such facilities to operators of industry groups to the list of industries operators of such facilities to identify establishments within the SIC codes their principal business activities by required to report to EPA and State added in the 1997 TRI Industry reporting, among other things, their governments. See 62 FR 23833, May 1, Expansion Rule, when such owners primary, and any other applicable SIC 1997 (hereinafter referred to as the have no other business interest in the codes for the facility. Congress also Industry Expansion Rule). These operation of such establishments. This granted EPA broad rulemaking authority industries included metal mining, coal amendment is unrelated to the purpose to allow the Agency to fully implement mining, electrical utilities that combust of this rule which is to change TRI the statute. EPCRA section 328 coal and/or oil for the purpose of reporting from SIC codes to NAICS authorizes the ‘‘Administrator [to] generating power for distribution in codes. The Agency is simply using the prescribe such regulations as may be commerce, facilities regulated under the opportunity of this rulemaking to necessary to carry out this chapter’’ (42 Resource Conservation and Recovery U.S.C. 11048). extend the exemption to all facilities Act (RCRA) subtitle C, chemical Consistent with these authorities, EPA that are covered under TRI. wholesalers, petroleum terminals and is amending 40 CFR part 372 to include III. Background Information bulk stations and solvent recovery the NAICS codes that correspond to the services. As a result, those facilities SIC codes that are currently subject to What Is the General Background for with the following SIC code section 313 of EPCRA and section 6607 This Action? designations (that meet all other of the PPA. Owners and operators of Section 313 of EPCRA and section applicable threshold criteria for TRI facilities that are subject to section 313 6607 of the PPA require owners and reporting) must report toxic chemical must identify their principal business operators of certain facilities called releases and other waste management activities by NAICS codes beginning ‘‘covered facilities’’ to annually report to quantities of toxic chemicals each year: with TRI reporting forms that are due on EPA, and to the State in which the SIC major group codes 10 (except 1011, July 1, 2007, covering releases and other facility is located, their releases and 1081, and 1094), 12 (except 1241), or 20 waste management quantities at the other waste management quantities of through 39; industry codes 4911, 4931, facility for the 2006 calendar year. listed toxic chemicals. 42 U.S.C. 11023, or 4939 (limited to facilities that Finally, EPA is amending 40 CFR 13106. In general, a covered facility is combust coal and/or oil for the purpose 372.38(e) to extend the exemption one that: (1) Manufactures, processes, or of generating power for distribution in provided therein to owners of covered otherwise uses one or more chemicals commerce); 4953 (limited to facilities facilities who lease, with no other listed in the EPCRA section 313 list of regulated under the Resource business interest, such facilities to toxic chemicals in excess of specified Conservation and Recovery Act, subtitle operators of establishments that are threshold quantities; (2) has 10 or more C, 42 U.S.C. 6921 et seq.); 5169; 5171; classified in any SIC code or NAICS full-time employees or the equivalent or 7389 (limited to facilities primarily code that is subject to TRI requirements. 20,000 hours per year and; (3) is engaged in solvent recovery services on

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a contract or fee basis). (See 40 CFR 313 of EPCRA and section 6607 of the Bureau’s Web site at http:// 372.22.) PPA. www.census.gov/epcd/www/ As explained below, the United States In this final rule, EPA is amending 40 naicstab.htm. A more direct crosswalk is in the process of replacing SIC with CFR Part 372 to include the NAICS between the 1987 SIC and 2002 NAICS NAICS. This final action will put NAICS codes that correspond to the SIC codes may be found in ‘‘Table 4: 1987 SIC in place for the TRI Program. that are currently subject to the Matched to 2002 NAICS’’ at http:// reporting requirements of section 313 of www.census.gov/epcd/naics02/. IV. Final Action EPCRA and section 6607 of the PPA. EPA developed its crosswalk A. Why Did the EPA Propose This EPA is also amending 40 CFR document by carefully mapping each Action, and What Will the Final Action 372.85(b)(5) and 372.95(b)(10) such that SIC code to its corresponding NAICS Be? covered facilities must report their code or codes, and then mapping each On April 9, 1997, the Office of appropriate NAICS codes on the TRI of the resulting NAICS codes back to reporting form, Form R, or on the SIC. More specifically, for each 3-digit Management and Budget (OMB) Alternate Threshold Certification industry subsector in the NAICS published a Federal Register Notice of Statement, Form A, where applicable. manufacturing sector (i.e., NAICS 311 final decision (62 FR 17288) to adopt EPA is also amending 40 CFR 372.38(g) through 339), EPA checked OMB’s NAICS for the United States, a new and (h), and 40 CFR 372.45 to include NAICS to SIC crosswalk table at http:// economic classification system that the NAICS codes that will be subject to www.census.gov/ to find industries that replaces the SIC system which has the exemption and notification are not in the SIC manufacturing sector traditionally been used by the Federal requirements of those sections. Finally, (SIC codes 20 through 39), but that have Government for collecting and EPA is amending 40 CFR 372.38(e) to been classified as manufacturing organizing industry-related statistics. extend the exemption provided therein industries under NAICS. Similarly, EPA See Executive Office of the President, to owners of covered facilities who checked OMB’s ECPC SIC to NAICS Office of Management and Budget, lease, with no other business interest, crosswalk table to find SIC North American Industry Classification such facilities to operators of manufacturing industries that are not System—United States, 1997 establishments that are classified in any classified in the NAICS manufacturing (hereinafter referred to as the 1997 SIC code or NAICS code that is subject sector. By conducting this mapping, NAICS Manual). OMB’s Economic to TRI reporting requirements. EPA was able to develop a list of NAICS Classification Policy Committee (ECPC) codes that corresponds to the list of B. Will This Final Rule Affect the developed NAICS in cooperation with manufacturing sector SIC codes that are Universe Of Facilities That Are the Instituto Nacional de Estadı´stica, subject to TRI requirements. EPA Currently Required To Report to EPA Geografı´a e Informa´tica (INEGI) of conducted similar mapping with respect and the States? Mexico and Statistics Canada, in order to the industries added to TRI in the to standardize the industrial statistics With the exception of facilities Industry Expansion Rule. Please refer to produced by the three countries. It was defined as ‘‘auxiliary facilities’’ under the preamble to the proposed rule (68 felt that the SIC system was inadequate SIC (see Unit V.D.), this action will not FR 13877–13878) for a more complete for this purpose, in part because it affect the universe of facilities that is discussion of the methodology EPA classified industries on the basis of currently required to report under used to identify NAICS codes that several different economic concepts. section 313 of EPCRA and section 6607 correspond to currently covered SIC NAICS, on the other hand, classifies of the PPA because EPA is not adding codes. establishments according to similarities or deleting industry groups from the list When EPA issued the proposed rule, in the processes used to produce goods of industries that are currently subject to it identified the NAICS codes that and services. NAICS is the first industry section 313 reporting requirements. EPA correspond to covered SIC codes based classification system developed in is simply assigning NAICS codes to on the OMB crosswalks between the accordance with a single principle of those SIC codes that are already subject 1987 SIC Manual and the 1997 NAICS aggregation, the principle that to section 313 reporting requirements, Manual. OMB formalized adoption of producing units that use similar and requiring covered facilities in those revisions to the 1997 NAICS Manual in production processes should be grouped industries to report the NAICS code that a Federal Register notice on January 16, together in the classification. corresponds to the covered SIC code. 2001 (66 FR 3826–3827). In 2002, OMB Notwithstanding its primary function EPA notes that this action also published a revised NAICS Manual. See as a tool to aid in the collection and eliminates reporting requirements for Executive Office of the President, Office organization of industrial statistical owners of covered facilities who lease, of Management and Budget, North information, OMB recognized that with no other business interest, such American Industry Classification NAICS, like its predecessor, SIC, may facilities to operators of establishments System United States, 2002 (hereinafter also be effectively used for nonstatistical that are classified in the Industry referred to as the 2002 NAICS Manual). purposes including administrative, tax Expansion Rule SIC codes, but this As explained in Unit V.E., the final list and regulatory programs. However, in revision does not affect the universe of of NAICS codes to be covered under TRI its notice of final decision adopting covered facilities, only who is required has been updated to reflect several NAICS for the United States, OMB to report on such facilities. minor additions and revisions that the instructed the heads of government The TRI Program developed an 2002 NAICS Manual made to the 1997 agencies to determine that NAICS extensive SIC to NAICS to SIC NAICS codes that were identified in the industry definitions are appropriate for crosswalk document based on ECPC’s proposed rule as corresponding to the implementation of such programs U.S. SIC to NAICS and NAICS to SIC covered SIC codes before agencies use NAICS codes in conversion tables in order to identify them. See 62 FR 17288, 17294. For the the universe of NAICS codes that C. Why Will EPA Add NAICS Codes for reasons discussed in Unit IV.C. below, correspond to covered SIC codes. See EPCRA Section 313 and PPA Section EPA’s Administrator has determined ‘‘Table 1: 1997 NAICS Matched to 1987 6607 Reporting Purposes? that NAICS industry definitions will be SIC’’ and ‘‘Table 2: 1987 SIC Matched to EPA has determined it is appropriate appropriate for implementing section 1997 NAICS’’ on the U.S. Census to amend 40 CFR Part 372 to include the

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NAICS codes that correspond to the SIC SIC codes. Because the statute identifies the EPA docket under Docket ID No. codes that are currently subject to TRI covered facilities by SIC code, the EPA–HQ–TRI–2002–0003. reporting requirements for several industries subject to TRI requirements A. What comments did EPA receive on reasons. First, the SIC Manual has not will continue to be identified in the its method for implementing NAICS for been updated since 1987 despite regulatory text by SIC code; however, TRI reporting? significant changes in the national the text will be amended to include economy, and limitations in the NAICS codes as well. See 40 CFR One commenter states that EPA noted structure of the SIC system have led to 372.22(b) and 372.23 of the amended in the proposed rule that its intent in difficulties in classifying new and regulatory text below. With the adopting NAICS codes for TRI purposes emerging industries (1997 NAICS exception of auxiliary facilities, is to make sure presently covered Manual at 21). As a result, the existing facilities that currently report to the TRI facilities continue to report and so be SIC system does not reflect many of the Program because they are classified in a ‘‘consistent with the statutory important changes that have occurred covered SIC code must continue to requirements.’’ The commenter believes, within the national economy over the report to the TRI Program under this however, that there is no explanation of last decade or so. More importantly, it action if they continue to satisfy the the statutory requirements that EPA is will not be updated in the future applicable reporting criteria; however, being consistent with, and whether they because of OMB’s adoption of NAICS as these facilities may now rely on the list are relevant to the changing industry the United States’ new industry of covered NAICS codes in the amended and how it is classified. The commenter classification system. Accordingly, regulations to determine whether they also believes that EPA should not facilities that come into existence in the are subject to TRI reporting attempt to correlate SIC sectors with future will not have experience using requirements. Accordingly, EPA no NAICS sectors. For the purpose of SIC codes and may have difficulty longer expects facilities to identify their simplification and ease of explanation determining whether or not they are SIC codes to determine TRI program to the regulated community, the subject to TRI requirements. Moreover, compliance. commenter believes that the proposal as OMB has recognized, the SIC system should state that covered codes will be is somewhat cumbersome and inflexible F. Why Is EPA Extending the Exemption NAICS 31–33 (NAICS manufacturing to use because it classifies industries on in 40 CFR 372.38(e)? sector) plus the Industry Expansion the basis of several economic principles The TRI regulations at 40 CFR Rule facilities. The commenter has rather than a single, consistent principle 372.38(e) currently exempt from TRI suggested new language for 40 CFR (Id.). NAICS, on the other hand, reporting requirements ‘‘owners of 372.22(b) to achieve this objective. The represents a more targeted approach to facilities such as industrial parks, all or commenter also believes that in the year industry classification, focusing part of which are leased to persons who after rule approval, EPA should educate primarily on production processes. operate establishments within SIC code facilities regarding the change and Finally, the conversion to NAICS is part 20 through 39 where the owner has no assign a proposed NAICS number for of EPA’s data standards program, which other business interest in the operation the facility to review and accept and helps promote efficient data exchange of the covered facility.’’ The exemption that the burden should be on the EPA and integration through consistently acknowledges the difficulties in to educate reporters and make the initial defined and formatted data. Using requiring such an owner to report when correlations between SIC and NAICS NAICS for TRI reporting purposes will he is not in a position that would allow codes. The commenter further states enable more efficient database him to determine compliance or report that future NAICS revisions should be integration and will promote public the required information. EPA believes used ‘‘as is’’ to include the access to commonly defined data from it is appropriate to extend this manufacturing sectors with no disparate sources. exemption to owners of facilities that consideration of past revisions and that correlation should only be used for lease such facilities to operators of D. Office of Management and Budget historical statistical purposes. The establishments within the SIC codes Updates to NAICS commenter also disagrees with the added in the 1997 TRI Industry stated differences between SIC and OMB plans to update NAICS every Expansion Rule, when such owners NAICS systems in the proposed rule. In five years. The next update is scheduled have no other business interest in the particular, the commenter points out for 2007. In accordance with OMB’s operation of such establishments. The that NAICS, like SIC, was developed to established NAICS revision practice, a rationale for the exemption applies reflect changes in the economy and in final decision FR notice for the 2007 equally to those owners as it does to industries and that under both NAICS revision will be published early owners of facilities who lease them to classification systems establishments in 2006 and the 2007 NAICS Manual operators of establishments in SIC codes will be published early in 2007. The TRI are classified according to their primary 20 through 39. Because the amendment activities. Program will issue Federal Register to 40 CFR 372.38(e) extends the notices to update the NAICS codes that EPA Response: The commenter is exemption to other industries, there is correct that EPA’s intent is to correspond to covered SIC codes every no cost to industry associated with it. five years, if necessary, after OMB implement NAICS in such a way that, completes its five-year updates. V. Summary of Public Comments and with the exception of auxiliary facilities EPA Responses (see Unit V.D.), there is no change in the E. How Will TRI Reporting universe of facilities that is currently Requirements Change as a Result of What comments did EPA receive on the required to report toxic chemical This Final Rule? proposal to add NAICS codes for TRI releases and other waste management TRI reporting requirements remain reporting and what are EPA’s quantities under section 313 of EPCRA substantially the same under this action. responses? and section 6607 of the PPA. EPA The difference is that covered facilities EPA received comments from five believes this approach to implementing will report their primary and secondary entities in response to the proposal to NAICS with respect to TRI reporting is NAICS codes on Form R and Form A, add NAICS codes for TRI reporting. The the most consistent with EPCRA section rather than their primary and secondary submitted comments can be accessed in 313. As EPA stated in the proposed rule:

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For purposes of TRI reporting, section 313 that establishments are classified Nevertheless, even if retail bakeries defines covered facilities in terms of SIC according to their primary activities would not normally satisfy the codes. Facilities in the affected SIC codes are under both SIC and NAICS. However, applicability criteria, they would still required to report, regardless of how those incur the burden of making compliance facilities are designated in other NAICS is in fact a different nomenclature systems. Because inclusion in classification system than SIC. In determinations, (e.g., determining a specific SIC code is what triggers the particular, the organizing principle whether they manufacture, process or reporting obligation, to use NAICS codes, underlying NAICS differs in certain otherwise use listed toxic chemicals in EPA must be able to ‘‘cross-walk’’ reliably fundamental respects from the excess of applicable thresholds and between SIC codes and NAICS codes. organizing principles underlying SIC. whether they meet the full-time 68 FR 13876, March 21, 2003. As As the Standard Industrial Classification employee criterion). More importantly, indicated in this excerpt from the Manual, 1987 states: section 313(b)(1)(A) indicates that retail proposed rule, the statutory The [SIC] classification system is organized bakeries are not currently subject to TRI requirements underlying EPA’s to reflect the structure of the U.S. economy. reporting requirements. Nor has EPA proposed approach are found in section It does not follow any single principle, such made a determination pursuant to 313 which defines covered facilities in as end use, nature of raw materials, product, section 313(b)(1)(B) that it would be terms of SIC codes. In particular, EPA or market structure. * * * ‘‘relevant to the purposes of [section explained that section 313(b)(1)(A) of 1987 SIC Manual at 699. (For a 313]’’ for retail bakeries to begin EPCRA explicitly identifies, by SIC comprehensive discussion of the reporting to TRI. Similar changes in the universe of code, the universe of facilities that was organizing principles underlying the facilities that are subject to EPCRA initially subject to TRI reporting when SIC system, see Economic Classification section 313 could occur with respect to the statute was enacted. See 68 FR Policy Committee, Report No. 1: the SIC industries added to TRI in the 13875. Section 313(b)(1)(A) provides in Economic Concepts Incorporated in the relevant part: 1997 Industry Expansion Rule. Such Standard Industrial Classification changes would not be the result of The requirements of this section shall Industries of the United States, Aug. changes in the economic activities at the apply to owners and operators of facilities 1994, available at http:// facility itself. Nor would they be the * * * that are in Standard Industrial www.census.gov/epcd/naics/ecpcrpt1). result of a rulemaking supported by the Classification Codes 20 through 39 (as in In contrast, NAICS was developed effect on July 1, 1985). * * * statutory finding required under section around the single organizing principle 313(b)(1)(B) (or section 313(b)(2) which 42 U.S.C. 11023(b)(1)(A). In addition, that establishments should be grouped authorizes EPA to apply section 313 EPCRA authorizes EPA to ‘‘add or delete into industries ‘‘according to similarity requirements to particular facilities Standard Industrial Classification in the processes used to produce goods without regard to their SIC codes). codes’’ to the list of those initially or services.’’ 1997 NAICS Manual at 13. Rather, the changes would result simply identified by Congress in section This makes NAICS ‘‘unique among because the organizing principles for the 313(b)(1)(A) as being subject to TRI industry classification systems.’’ Id. at 3. industry classification system that is in reporting requirements. See EPCRA With respect to TRI, the result of the effect today are different from those section 313(b)(1)(B), 42 U.S.C. different organizing principles inherent underlying the industry classification 11023(b)(1)(B). However, EPA may only in SIC and NAICS is that facilities that system that was in effect for 50 years add SIC codes under section are classified in the SIC ‘‘manufacturing prior to the time that Congress enacted 313(b)(1)(B) if it concludes that each sector’’ (SIC codes 20–39) which EPCRA. EPA does not believe that this ‘‘Standard Industrial Code to which Congress intended to be subject to TRI is a sufficient basis to impose reporting [section 313] applies is relevant to the requirements might not be classified in obligations on facilities that otherwise purposes of [section 313].’’ Id. EPCRA the NAICS ‘‘manufacturing sector’’ would not be subject to section 313 or therefore explicitly provides in section (NAICS codes 31–33). Accordingly, if to exempt facilities from TRI reporting 313(b)(1)(A) and section 313(b)(1)(B) EPA had proposed that the NAICS requirements that otherwise would be that section 313 applies to facilities in ‘‘manufacturing sector’’ report under required to report. EPA conducted a SIC codes 20 through 39 and to facilities EPCRA section 313, then some facilities careful crosswalk between SIC codes in other SIC codes that EPA makes that are currently subject to TRI would covered under EPCRA section 313 and subject to EPCRA requirements by rule, be exempt from reporting. Similarly, PPA section 6607 and the corresponding if such facilities also meet the full-time facilities that are not currently subject to NAICS codes. The Agency believes it employee and chemical activity criteria. TRI requirements because they are not has correctly identified the covered EPA believes, therefore, that the in the SIC ‘‘manufacturing sector’’ might NAICS codes as reflected in the facilities that are currently subject to be classified in the NAICS amended 40 CFR part 372, and no TRI reporting because they are in a ‘‘manufacturing sector’’ and would longer expects facilities to identify their covered SIC code should continue to be therefore be subject to TRI reporting. For SIC codes to determine TRI program subject to TRI requirements after EPA example, as discussed in the preamble compliance. Facilities may now rely on implements NAICS for TRI purposes. to the proposed rule, if all facilities in the list of covered NAICS codes in the Similarly, facilities that are not NAICS codes 31–33 were required to amended 40 CFR part 372 to determine currently subject to TRI reporting report, then that would mean that retail whether they are required to report to because they are not in a covered SIC bakeries (SIC code 5461) would need to the TRI program. code should not be subject to TRI start reporting if they met the employee EPA disagrees with the commenter’s requirements simply because EPA is and chemical activity thresholds recommendation that EPA assign NAICS implementing NAICS for TRI purposes. because they are classified in the NAICS codes to currently reporting facilities. EPA agrees with the commenter that ‘‘manufacturing sector’’ (NAICS 31181). Unlike some government programs that NAICS was developed because the See 68 FR 13876. It may be true in do assign SIC or NAICS codes to a economy changes and industries change practice that retail bakeries would rarely particular establishment based on over time and therefore, the industry have to report because they typically information provided to the government classification system must be updated to would not meet the full-time employee about the facility’s activities, EPA has reflect such changes. EPA also agrees and/or chemical activity criteria. never followed this approach in

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implementing section 313. Facilities of the applicability of EPCRA section situations, where facilities consist of have typically self-determined their SIC 313 to facilities in SIC code 4953 (or the two or more establishments, the TRI codes for purposes of TRI and EPA corresponding NAICS codes identified regulations provide instructions for believes that they should continue to do below), or the types of facilities in SIC determining the primary SIC or NAICS so with NAICS codes. Owners and code 4953 (or the corresponding NAICS code for the entire facility for TRI operators have first-hand knowledge of codes) that are subject to TRI. In reporting purposes. If all of the the activities undertaken at their addition, as noted in Unit V.A. of this establishments at the facility have facilities and such knowledge is useful preamble, SIC or NAICS code covered SIC or NAICS codes, then the in assigning an appropriate SIC or determinations are very fact-specific, facility has met the SIC or NAICS code NAICS code to a facility. This is and it is not appropriate to attempt to requirement. 40 CFR 372.22(b)(2). In the particularly true with respect to address questions related to specific case of a multi-establishment facility determining SIC or NAICS codes for TRI facilities in this context. Therefore, this with at least one establishment in a non- reporting because facilities often need to response should not be construed as covered SIC or NAICS code, 40 CFR evaluate activities and economic data at addressing facility-specific issues 372.22(b)(3) requires the facility to multiple establishments and make regarding such determinations. compare the relative value added of the judgments based on that information in In order to determine if a recycling various establishments to determine accordance with 40 CFR 372.22(b)(3) in facility, such as a mercury-lamp whether the facility as a whole is in a order to determine the SIC or NAICS recycler, is required to report under TRI, covered SIC or NAICS code. For code that applies to the entire facility. two determinations, in addition to the example, under section 372(b)(3)(i), if a employee and chemical activity B. What comments did EPA receive recycling facility consists of a SIC 4953 thresholds, are necessary. First, the establishment and a SIC 5093 seeking clarification of TRI reporting facility must be in a covered SIC code requirements for particular facilities? establishment, and the relative value (or a corresponding NAICS code). added of the facility’s SIC 5093 scrap One commenter, although in support Second, if the facility is in a covered SIC and waste material wholesale operations of the proposal to incorporate NAICS code (or a corresponding NAICS code), is greater than 50 percent of the total codes into the TRI program, requested the facility must also be regulated under value added of services provided or that the Agency clarify the TRI reporting RCRA Subtitle C. products shipped or produced by the requirements for recycling facilities that The NAICS Determination. The whole facility, then the facility would are exempt from obtaining RCRA commenter requested that EPA clarify be classified in SIC code 5093 and Subtitle C permits. The commenter whether recycling facilities are would not be subject to TRI reporting. notes that many hazardous waste classified under SIC code 4953 (Refuse Without facility-specific information of management facilities are exempt from Systems) or under SIC code 5093 (Scrap this nature, EPA cannot determine the RCRA permitting requirements, but are and Waste Materials) for purposes of proper SIC or NAICS code for a still regulated under RCRA Subtitle C. TRI reporting. SIC code 4953 includes particular recycling facility or for According to the commenter, at least establishments that are ‘‘primarily recycling facilities in general. one EPA Regional Office provided engaged in the collection and disposal guidance indicating that facilities that of refuse by processing or destruction or Regulated Under Subtitle C. The recycle mercury-containing fluorescent in the operation of incinerators, waste commenter requested that EPA clarify lamps and other Universal Wastes are treatment plants, landfills, or other sites the applicability of TRI to facilities that required to report to TRI because these for the disposal of such materials.’’ 1987 are exempt from RCRA permitting facilities fall under SIC code 4953 and SIC Manual at 285. Facilities that are requirements, but are still regulated are regulated under RCRA Subtitle C. By classified under SIC 4953 are classified under RCRA Subtitle C, because for the contrast, however, the commenter noted in one of the following NAICS codes: SIC code 4953 and the corresponding that in another region, a mercury-lamp NAICS 562211, Hazardous Waste NAICS codes, TRI reporting is ‘‘limited recycling facility has assumed that it is Treatment and Disposal; 562212, Solid to facilities regulated under [RCRA] properly categorized under SIC 5093 Waste Landfill; 562213, Solid Waste Subtitle C.’’ 40 CFR 372.22. and the EPA Regional Office in that case Combustors and Incinerators; 562219, The commenter mistakenly believes has not provided any guidance or Other Nonhazardous Waste Treatment that recycling facilities are exempt from information contradicting the facility’s and Disposal; or 562920, Materials TRI reporting. EPA has not provided assumption of its designation under this Recovery Facilities. A facility in one of rules or guidance that exempt recycling SIC code. The commenter believes that the above NAICS categories is required facilities from TRI reporting. As the recycling facilities should be exempt to submit a TRI report if it is also commenter correctly notes, there are from TRI reporting, but if not, that EPA regulated under Subtitle C and meets recycling facilities that are not required should clarify in this rulemaking the the employee and chemical activity to obtain a RCRA permit (or interim SIC or NAICS codes that these facilities thresholds. status) but nonetheless, are regulated come under that would require TRI By contrast, facilities classified under under Subtitle C. For example, some reporting. SIC 5093, Scrap and Waste Materials, recycling facilities must complete the EPA Response: As an initial matter, are not covered by the TRI Program, and hazardous waste manifest, an important EPA believes that this comment is they are classified under NAICS 42193, part of the Subtitle C cradle to grave beyond the scope of this rulemaking Recyclable Material Wholesalers. SIC tracking system. Some recycling which simply identifies the NAICS code 5093 includes establishments that facilities also must provide notifications codes that correspond to SIC codes that are ‘‘primarily engaged in assembling, and reports to EPA and authorized are currently subject to EPCRA section breaking up, sorting, and wholesale states. Still other recycling facilities 313. Nonetheless, EPA believes it may distribution of scrap and waste must comply with air emission be helpful to provide some additional materials.’’ 1987 SIC Manual at 301. standards issued under Subtitle C. Each clarification on this point in this In many cases, recycling facilities may of these facilities would be regulated preamble. By doing so, however, EPA be engaged in both of these activities, under RCRA Subtitle C and would also does not intend in any way to and possibly other SIC or NAICS- be required to report to TRI if reporting reconsider or otherwise reopen the issue defined activities as well. In such thresholds were met.

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C. What comments did EPA receive transparent. The regulatory text at 40 administrative purposes may also reflect regarding cross references from SIC CFR 372.23(b) and (c) is simply a such program-specific interpretations. codes to NAICS codes? condensed version of the information That does not mean, however, that One comment was submitted that presented in the OMB crosswalk. The owners or operators cannot or should stated that EPA has not provided a methodology that EPA used to translate not consult the NAICS Manual itself to determine the most appropriate NAICS comprehensive cross reference to the lengthy OMB crosswalk into the code for their facilities based on the correspond SIC codes to NAICS codes, condensed version of it that appears in activities that occur at the facility. In and does not refer the regulated the regulatory text is explained at length fact, EPA strongly encourages owners community to the NAICS manual to in the proposed rule. See 68 FR 13877– and operators to consult the NAICS assist them in selecting the appropriate 13879. In response to the commenter’s Manual when determining the most NAICS code. The commenter believes suggestion that EPA codify the actual appropriate NAICS code for their that EPA’s assignment of NAICS codes OMB crosswalk, EPA believes the facilities. In the unlikely event that a to the SIC codes that are currently amount of information that would need facility that is in a covered SIC code subject to TRI reporting requirements is to be codified would make it more uses the NAICS Manual to determine a not straightforward and transparent. The difficult for facilities to determine NAICS code for the facility, and commenter further believes that the whether or not the NAICS code that concludes that the most appropriate proposed revisions to 40 CFR 372.23 are applies to their facility corresponds to a NAICS code is not the same one that just a compilation of ‘‘exceptions and/ covered SIC code. If codified, the OMB has determined corresponds to its or limitations’’ with little guidance on portion of the OMB crosswalk that SIC code, then that facility is welcome determining corresponding codes. The would need to be included in the CFR to contact EPA to discuss the commenter is concerned that facilities would likely occupy dozens of pages. In discrepancy. Ultimately, any that use other reference sources to contrast, the list of NAICS codes in the disagreement between a facility and determine corresponding NAICS codes regulatory text at 40 CFR 372.23 will EPA with respect to the facility’s proper might arrive at a different conclusion likely occupy two to three pages in the NAICS code will be resolved based on than EPA and could therefore be subject CFR. In order to present the crosswalk the facility’s activities and whether they to an enforcement action. The information in a condensed form, it was are most appropriately described by one commenter also believes that EPA necessary for EPA to create exceptions of the NAICS industry descriptions should consider making the OMB and limitations to accurately identify identified in the regulatory text or by crosswalk information available in a the specific NAICS codes that some other NAICS code. guidance document or codifying the correspond to currently covered SIC D. What comments did EPA receive information. codes. EPA Response: EPA disagrees that it The commenter indicates that regarding its proposal to require has not provided a comprehensive cross facilities might use reference sources ‘‘auxiliary facilities’’ to continue to reference to adequately correspond SIC other than the OMB crosswalk to report to TRI using the NAICS code of codes to NAICS codes. The NAICS determine corresponding NAICS codes, the establishment or facility for which it codes in the proposed regulatory text at and that they will therefore have to performs support services? 40 CFR 372.23 that correspond to the consult the OMB crosswalk in the Two commenters disagreed with SIC codes that are currently subject to docket for the proposed rule to verify EPA’s guidance in the preamble to the TRI reporting requirements were their determinations. First, as noted proposed rule that auxiliary facilities determined by using comprehensive SIC above, the OMB crosswalk is not only should report using the NAICS code of to NAICS and NAICS to SIC crosswalk available in the EPA public docket for the facility for which they perform documents that were developed by the proposed rule, but it is also available support services and recommend that OMB’s ECPC. As the commenter notes, on the NAICS Web site hosted at the EPA reconsider how to classify auxiliary the OMB crosswalk documents are Census Bureau. Second, EPA would like facilities in light of the fact that the SIC included in the docket for the proposed to clarify that in this rulemaking, the classification methodology differs rule. They are also publicly accessible Agency is simply identifying the NAICS significantly from the NAICS on the Census Bureau’s Web site at codes that correspond to SIC codes that classification methodology. One of the http://www.census.gov/epcd/www/ are currently subject to TRI reporting. commenters further stated that EPA naics.html and http://www.census.gov/ As discussed above, EPA believes should also consider that new auxiliary epcd/naics02/. EPA used the OMB OMB’s experience and expertise with facilities (e.g., Research & Development crosswalk as the basis for its implementing SIC and NAICS make its sites) will likely determine their determinations of TRI NAICS reporting crosswalk between SIC and NAICS appropriate NAICS code by following facilities because OMB is the Federal reliable for that purpose. Therefore, if a the methodology in the NAICS manual government entity that is responsible for facility chooses to identify its NAICS which does not define auxiliary developing and maintaining Federal code for TRI purposes based only on its facilities, while older R&D facilities classifications. As such, OMB has current SIC code, EPA strongly would still be reporting since they were considerable experience and expertise recommends that the facility use the considered auxiliary facilities under the in making classification decisions for OMB crosswalk. To the extent that other obsolete SIC classification system. Federal statistical purposes. EPA has Federal Government agencies, State EPA Response: EPA has reconsidered examined these decisions and governments or private parties have guidance in the preamble to the determined that it is appropriate to developed similar crosswalks, EPA proposed rule with respect to the follow them, along with the exceptions discourages their use for determining reporting of NAICS codes by auxiliary presented in the regulatory text, for TRI NAICS codes for TRI purposes. Such facilities. The 1987 SIC Manual defines reporting purposes. crosswalks may reflect classification auxiliary establishments as EPA also disagrees that its assignment decisions that depend on the nature of establishments primarily engaged in of NAICS codes to the SIC codes that are the programs administered by such performing management or support currently subject to TRI reporting entities. NAICS codes that are assigned services for other establishments. [1987 requirements is not straightforward and to facilities by such entities for SIC Manual at 13.]. The SIC system

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assigns these establishments (e.g., look to the NAICS manual for reporting that is appropriate for its particular research and development laboratories, guidance, not the 1987 SIC Manual. warehousing activities. Thus, this warehouses, storage facilities) SIC codes These new establishments will not have particular multi-establishment facility according to the primary activity of the any prior experience with the SIC would no longer meet the SIC or NAICS operating establishments they serve. Id. system and the concept of auxiliary code requirement based solely on 40 at 16. For example, auxiliary establishments. Without extensive CFR 372.22(b)(2). Note however, that establishments tied to manufacturing outreach by EPA and possibly changes the facility could still meet the SIC or establishments are given a to the regulations in part 372, it will be NAICS code requirement based on 40 manufacturing SIC code. For purposes difficult to communicate to these CFR 372.22(b)(3), which requires of TRI reporting, auxiliary establishments that they may have a TRI owners or operators to compare the establishments are often referred to as reporting obligation based not on their relative value added by the various ‘‘auxiliary facilities.’’ In order to remain own activities but on those of the establishments in a multi-establishment consistent with the SIC nomenclature, establishments they serve. facility to determine whether the facility EPA will use the term ‘‘auxiliary It is possible, in light of EPA’s new as a whole is in a covered primary SIC establishment’’ rather than ‘‘auxiliary interpretation, that some auxiliary or NAICS code. For example, if the facility’’ in the following discussion. establishments will no longer be subject value added by the manufacturing EPCRA section 313(b)(1)(A) states that to TRI reporting requirements. For establishment in the example above section 313 requirements ‘‘shall apply to example, under EPA’s previous exceeded that of the warehousing owners and operators of facilities * * * interpretation, a stand-alone auxiliary establishment, then the entire multi- that are in [SIC] codes 20 through 39.’’ establishment (e.g., a warehouse that is establishment facility would meet the Since the inception of the TRI Program not part of a larger facility) that met the SIC or NAICS code requirement under in 1988, the Agency has interpreted employee and chemical activity either of the tests in 40 CFR 372.22(b). EPCRA section 313 to cover operating thresholds, and that was classified in a establishments and auxiliary covered SIC or NAICS code only E. What comments did EPA receive establishments, consistent with the 1987 because it served an off-site operating regarding OMB’s NAICS 2002 update SIC Manual definition of auxiliary establishment in a covered SIC or that was published in the January 16, establishment. EPA noted at the time NAICS code, would have been subject to 2001 Federal Register (66 FR 3826)? that it believed that this would be the TRI reporting requirements. Under the EPA received recommendations that most consistent way to treat auxiliary new interpretation, the same the NAICS codes in the proposed rule establishments. 53 FR 4500, 4503 (Feb. establishment would no longer be be updated to match the NAICS 2002 16, 1988). subject to such requirements because it listing according to the OMB notice of NAICS, however, did not adopt the would not meet the SIC or NAICS code final decision published January 16, SIC system concept of auxiliary requirement. In contrast, auxiliary 2001 (66 FR 3826) that adopted the 2002 establishments. NAICS was developed establishments that are part of multi- NAICS codes. around the single organizing principle establishment facilities whose primary EPA Response: EPA agrees with the that establishments should be grouped SIC or NAICS codes are covered under commenter and has updated the final into industries according to similarities EPCRA section 313 would still be rule to reflect minor, non-substantive in the processes used to produce goods subject to section 313 if the entire changes that the 2002 NAICS Manual or services.’’ 1997 NAICS Manual at 13. facility also met the employee and made to certain 1997 NAICS codes that Thus, under NAICS, former SIC chemical activity thresholds. were included in the proposed rule. The auxiliary establishments are assigned In this regard, it is important to note 2002 NAICS update made no changes to NAICS codes according to their own that this new interpretation could affect the 1997 manufacturing sector NAICS activities (e.g., a research and the determination of the primary SIC or codes. development facility that supported a NAICS code for a multi-establishment Outside of the manufacturing sector, SIC 3728 Aircraft Parts and Auxiliary facility in the first instance. For the only TRI covered sectors that were Equipment facility would be classified example, under 40 CFR 372.22(b)(2), if affected by the 2002 NAICS revisions under NAICS 54171, Research and all establishments in a multi- were the Wholesale Trade and Development in the Physical, establishment facility have covered Information sectors (NAICS sectors 42 Engineering, and Life Sciences). primary SIC or NAICS codes, then the and 51, respectively). These revisions For the purpose of establishing entire facility has met the SIC or NAICS and additions are included in the final consistency with the NAICS code requirement. Consider a multi- list of NAICS codes that will be covered classification methodology, and to avoid establishment facility that consists of under TRI. See 40 CFR 372.23 of the confusion in the future with respect to two establishments. One is an auto parts final regulatory text. reporting obligations by establishments manufacturing establishment that is in a As stated before, with the exception of that are considered auxiliary covered manufacturing code, and the auxiliary facilities, this final rule will establishments under the SIC system, other is an auxiliary establishment (e.g., not affect the universe of facilities that EPA is changing its interpretation that a warehouse) that serves the is currently required to report under EPCRA reporting requirements apply to manufacturing establishment. Under section 313 of EPCRA and section 6607 auxiliary establishments. EPA believes EPA’s previous interpretation, this of the PPA because EPA is not adding this change is warranted in light of the multi-establishment facility would have or deleting industry groups from the list significant differences in treatment of been in a covered primary SIC code of industries that are currently subject to auxiliary establishments between the because both establishments share the section 313 reporting requirements. SIC and NAICS systems. In future same manufacturing code. Under the reporting years, NAICS codes will be the new interpretation, the warehouse VI. Which NAICS Codes Are Subject to only economic classification codes that would not be in a covered SIC code TRI Requirements Under This Final are used by reporting facilities on TRI simply because of its status in the SIC Rule? reporting forms, and new entities that system as an auxiliary facility. Nor is it Using the OMB crosswalk tables and may have been classified as auxiliary likely to be in a covered NAICS code. the methodology described in the establishments facilities under SIC will Instead, it would have a NAICS code proposed rule (68 FR 13877–13878),

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EPA has determined that facilities 4. Federal Register: April 20, 2000 B. Regulatory Flexibility Act classified in the NAICS codes listed in (Volume 65, Number 77), Office of The RFA generally requires an agency the final regulations in 40 CFR 372.23 Management and Budget, North to prepare a regulatory flexibility must report their toxic chemical releases American Industry Classification analysis of any rule subject to notice and other waste management quantities System—Update for 2002: Notice of and comment rulemaking requirements to EPA and State governments. This list solicitation of comments on the under the Administrative Procedure Act will be used for regulatory and Economic Classification Policy or any other statute unless the agency enforcement purposes. Committee’s recommendations for the certifies that the rule will not have a VII. What Additional Reporting Burden 2002 revision of the North American significant economic impact on a Is Associated With This Action? Industry Classification System substantial number of small entities. Small entities include small businesses, EPA has evaluated the potential 5. Federal Register: January 16, 2001 (Volume 66, Number 10), Office of small organizations, and small burden and cost of using NAICS for TRI governmental jurisdictions. reporting and expects that the burden Management and Budget, North American Industry Classification For purposes of assessing the impacts associated with this change for affected of this rule on small entities, small facilities is negligible. OMB adopted System—Revision for 2002; Notice of final decision entity is defined as: (1) A business that NAICS as the United States’ industry is classified as a ‘‘small business’’ by the classification system in 1997, and 6. Economic Classification Policy Small Business Administration at 13 facilities should already be familiar with Committee, Report No. 1: Economic CFR 121.201; (2) a small governmental their NAICS codes from other Concepts Incorporated in the Standard jurisdiction that is a government of a administrative and regulatory reporting Industrial Classification Industries of city, county, town, school district, or requirements of EPA and other the United States, Aug. 1994 (http:// special district with a population of less governmental entities. With the www.census.gov/epcd/naics/ecpcrpt1). than 50,000; and (3) a small exception of auxiliary facilities, EPA 7. Executive Office of the President, organization that is any not-for-profit does not expect or intend this action to enterprise that is independently owned affect the universe of facilities that are Office of Management and Budget, North American Industry Classification and operated and is not dominant in its currently required to report under field. section 313 of EPCRA. EPA is simply System, United States, 2002 (NTIS PB2002–101430*88). The change required by this identifying NAICS industry codes rulemaking is to require facilities to which correspond to those SIC codes IX. Statutory and Executive Order report their NAICS codes rather than that are already subject to section 313 Reviews their SIC codes. The burden of reporting reporting requirements, and requiring NAICS codes in place of SIC codes is A. Executive Order 12866: Regulatory covered facilities in those industries to negligible considering that facilities are Planning and Review report under the NAICS code that or should be already using NAICS codes corresponds to the covered SIC code. in other government data collection Only those facilities that meet the Under Executive Order 12866, entitled Regulatory Planning and exercises. After consideration of the requirements in 40 CFR 372.22(b) will potential economic impacts of this rule need to continue to report releases and Review (58 FR 51735, October 4, 1993), the Agency must determine whether a on small entities, I certify that this other waste management quantities of action will not have a significant toxic chemicals under section 313 of regulatory action is ‘‘significant’’ and therefore subject to OMB review and the economic impact on a substantial EPCRA. The changed interpretation for number of small entities. auxiliary facility reporting will likely requirements of the Executive Order. result in some reduction of burden, The Order defines ‘‘significant C. Paperwork Reduction Act regulatory action’’ as one that is likely however, the Agency can not quantify This action does not impose any new to result in a rule with the following what burden reduction is likely to occur information collection burden. Facilities impacts: (1) May have an annual effect because there is no way to tell how that are affected by the rule already many stand-alone auxiliaries currently on the economy of $100 million or more report their industrial classification report or how auxiliaries currently affect or adversely affect in a material way the codes on the approved reporting forms multi-establishment applicability economy, a sector of the economy, using SIC codes. Moreover, OMB determinations. productivity, competition, jobs, the adopted NAICS several years ago, so environment, public health or safety, or affected facilities are or should already VIII. What Are the References Cited in State, local, or tribal governments or This Final Rule? be familiar with their NAICS codes from communities; (2) creates a serious administrative and regulatory reporting 1. Executive Office of the President, inconsistency or otherwise interfere requirements of EPA and other Office of Management and Budget, with an action taken or planned by governmental entities that have already North American Industry Classification another agency; (3) materially alters the converted to NAICS reporting. EPA will System, United States, 1997 (NTIS budgetary impact of entitlements, seek approval from OMB for the PB98–127293) grants, user fees, or loan programs or the amended reporting forms (which will 2. Executive Office of the President, rights and obligations of recipients include data fields for NAICS codes Office of Management and Budget, thereof; or (4) raises novel legal or instead of SIC codes) prior to the date Standard Industrial Classification policy issues arising out of legal when facilities must submit reports to Manual, 1987 (NTIS PB87–100012) mandates, the President’s priorities, or the TRI Program using NAICS codes. 3. 1997 NAICS U.S. Structure, the principles set forth in the Executive OMB has previously approved the Including Relationship to 1987 U.S. SIC, Order. It has been determined that this information collection requirements ‘‘Table 1: 1997 NAICS Matched to 1987 rule is not a ‘‘significant regulatory contained in the existing regulations at SIC’’ and ‘‘Table 2: 1987 SIC Matched to action’’ under the terms of Executive 40 CFR part 372 under the provisions of 1997 NAICS’’ (http://www.census.gov/ Order 12866 and is therefore not subject the Paperwork Reduction Act, 44 U.S.C. epcd/www/naicstab.htm). to OMB review. 3501 et seq. and has assigned the

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Information Collection Requests (ICRs) Administrator publishes with the final other administrative and regulatory OMB control numbers 2070–0093 (EPA rule an explanation why that alternative purposes. Thus, Executive Order 13132 ICR No. 1363–13) for Form R and 2070– was not adopted. Before EPA establishes does not apply to this rule. 0143 (EPA ICR No. 1704–07) for Form any regulatory requirements that may F. Executive Order 13175, Consultation A. A copy of the OMB approved ICR significantly or uniquely affect small and Coordination With Indian Tribal may be obtained from Susan Auby, governments, including tribal Collection Strategies Division; U.S. governments, it must have developed Governments Environmental Protection Agency under section 203 of the UMRA a small Executive Order 13175, entitled (2822T); 1200 Pennsylvania Ave., NW., government agency plan. The plan must Consultation and Coordination with Washington, DC 20460 or by calling provide for notifying potentially Indian Tribal Governments (65 FR (202) 566–1672. affected small governments, enabling 67249, November 9, 2000), requires EPA Burden means the total time, effort, or officials of affected small governments to develop an accountable process to financial resources expended by persons to have meaningful and timely input in ensure ‘‘meaningful and timely input by to generate, maintain, retain, or disclose the development of EPA regulatory tribal officials in the development of or provide information to or for a proposals with significant Federal regulatory policies that have tribal Federal agency. This includes the time intergovernmental mandates, and implications.’’ This rule does not have needed to review instructions; develop, informing, educating, and advising tribal implications, as specified in acquire, install, and utilize technology small governments on compliance with Executive Order 13175. This action and systems for the purposes of the regulatory requirements. merely adopts, for TRI reporting collecting, validating, and verifying EPA has determined that this rule purposes, the NAICS industry information, processing and does not contain a Federal mandate that classification system that has replaced maintaining information, and disclosing may result in expenditures of $100 the SIC system previously used for and providing information; adjust the million or more for State, local, and collecting statistical data and for other existing ways to comply with any tribal governments, in the aggregate, or administrative and regulatory purposes. previously applicable instructions and the private sector in any one year. As Thus, Executive Order 13175 does not requirements; train personnel to be able discussed in section VI above, EPA apply to this rule. to respond to a collection of believes that affected facilities already information; search data sources; are or should be familiar with their G. Executive Order 13045, Protection of complete and review the collection of NAICS codes from other activities, Children From Environmental Health information; and transmit or otherwise including reporting to other Risks and Safety Risks disclose the information. governmental authorities. Provision of Executive Order 13045, ‘‘Protection of An agency may not conduct or the NAICS code in lieu of the SIC code Children from Environmental Health sponsor, and a person is not required to is expected to impose negligible Risks and Safety Risks’’ (62 FR 19885, respond to a collection of information incremental burden on affected April 23, 1997), applies to any rule that: unless it displays a currently valid OMB facilities. Thus, this rule is not subject (1) Is determined to be ‘‘economically control number. The OMB control to the requirements of sections 202 and significant’’ as defined under Executive numbers for EPA’s regulations in 40 205 of UMRA. Order 12866, and (2) concerns an CFR are listed in 40 CFR part 9. E. Executive Order 13132 environmental health or safety risk that D. Unfunded Mandates Reform Act EPA has reason to believe may have a Executive Order 13132, entitled disproportionate effect on children. If Title II of the Unfunded Mandates Federalism (64 FR 43255, August 10, the regulatory action meets both criteria, Reform Act of 1995 (UMRA), Public 1999), requires EPA to develop an the Agency must evaluate the Law 104–4, establishes requirements for accountable process to ensure environmental health or safety effects of Federal agencies to assess the effects of meaningful and timely input by State the planned rule on children, and their regulatory actions on State, local, and local officials in the development of explain why the planned regulation is and tribal governments and the private regulatory policies that have federalism preferable to other potentially effective sector. Under section 202 of the UMRA, implications. The phrase, ‘‘Policies that and reasonably feasible alternatives EPA generally must prepare a written have federalism implications,’’ is considered by the Agency. statement, including a cost-benefit defined in the Executive Order to This rule is not subject to EO 13045 analysis, for proposed and final rules include regulations that have because it is not economically with ‘‘Federal mandates’’ that may ‘‘substantial direct effects on the States, significant as defined under Executive result in expenditures to State, local, on the relationship between the national Order 12866. and tribal governments, in the aggregate, government and the States, or on the or to the private sector, of $100 million distribution of power and H. Executive Order 13211, Actions or more in any one year. Before responsibilities among the various Concerning Regulations That promulgating an EPA rule for which a levels of government.’’ Significantly Affect Energy Supply, written statement is needed, section 205 This rule does not have federalism Distribution, or Use of the UMRA generally requires EPA to implications. It will not have substantial This rule is not subject to Executive identify and consider a reasonable direct effect on the States, on the Order 13211, ‘‘Actions Concerning number of the regulatory alternatives relationship between the National Regulations That Significantly Affect and adopt the least costly, most cost- Government and the States, or on the Energy Supply, Distribution, or Use’’ (66 effective or least burdensome alternative distribution of power and FR 28355, May 22, 2001), because it is that achieves the objective of the rule. responsibilities among the various not a significant regulatory action under The provisions of section 205 do not levels of government, as specified in Executive Order 12866. apply when they are inconsistent with Executive Order 13132. This action applicable law. Moreover, section 205 merely adopts, for TRI reporting I. National Technology Transfer and allows EPA to adopt an alternative other purposes, NAICS in place of the SIC Advancement Act than the least costly, most cost-effective system which has previously been used Section 12(d) of the National or least burdensome alternative if the for collecting statistical data and for Technology Transfer and Advancement

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Act of 1995 (NTTAA) (15 U.S.C. 272 Congress and to the Comptroller General American Industry Classification note), directs EPA to use voluntary of the United States. EPA will submit a System (NAICS) (as in effect on January consensus standards in its regulatory report containing this rule and other 1, 2002) subsector and industry codes activities unless to do so would be required information to the U.S. Senate, are listed in §§ 372.23(b) and 372.23(c)) inconsistent with applicable law or the U.S. House of Representatives, and by virtue of the fact that it meets one of otherwise impractical. Voluntary the Comptroller General of the United the following criteria: consensus standards are technical States prior to publication of the rule in (1) The facility is an establishment standards (e.g., materials specifications, the Federal Register. A ‘‘major rule,’’ as with a primary SIC major group or test methods, sampling procedures, etc.) defined by 5 U.S.C. 804(2), can not take industry code listed in § 372.23(a), or a that are developed or adopted by effect until 60 days after it is published primary NAICS subsector or industry voluntary consensus standards bodies. in the Federal Register. This action is code listed in § 372.23(b) or § 372.23(c). The NTTAA directs EPA to provide not a ‘‘major rule.’’ This rule will be (2) The facility is a multi- Congress, through OMB, explanations effective on August 7, 2006. establishment complex where all when the Agency decides not to use List of Subjects in 40 CFR Part 372 establishments have primary SIC major available and applicable voluntary group or industry codes listed in consensus standards. Environmental protection, § 372.23(a), or primary NAICS subsector EPA recognizes that NAICS, like SIC, Community right-to-know, Reporting or industry codes listed in § 372.23(b) or is a standard that was developed by and recordkeeping requirements, Toxic § 372.23(c). OMB primarily as a means to collect chemicals. (3) * * * and organize industrial statistics for the Dated: May 18, 2006. (i) The sum of the value of services Federal Government. However, EPA has Stephen L. Johnson, provided and/or products shipped and/ not identified an alternative voluntary Administrator. or produced from those establishments consensus standard for defining that have primary SIC major group or industry classifications, and no other I Therefore, 40 CFR part 372 is amended as follows: industry codes listed in § 372.23(a), or classification systems were brought to primary NAICS subsector or industry its attention in comments. Even if one PART 372—[AMENDED] codes listed in § 372.23(b) or § 372.23(c) exists, EPA believes it would be is greater than 50 percent of the total impractical to use such a standard for I 1. The authority citation for part 372 value of all services provided and/or reporting purposes under section 313 of continues to read as follows: products shipped from and/or produced EPCRA and section 6607 of the PPA. Authority: 42 U.S.C. 11023 and 11048. by all establishments at the facility. One of the reasons for switching from (ii) One establishment having a SIC to NAICS is to maintain consistency I 2. Amend § 372.3 by adding in primary SIC major group or industry within EPA and among other alphabetical order a definition for code listed in § 372.23(a), or a primary government agencies in the way that ‘‘Previously classified’’ to read as NAICS subsector or industry code listed industry-specific data is collected, follows: in § 372.23(b) or § 372.23(c) contributes organized, and made available to the more in terms of value of services public in various databases and § 372.3 Definitions. provided and/or products shipped from publications. Moreover, although * * * * * and/or produced at the facility than any NAICS is based on a different organizing Previously classified means properly other establishment within the facility. principle than SIC, the two classified, according to § 372.22(b) classification systems share many under a given Standard Industrial * * * * * similarities. Industry has had several Classification (SIC) code, as identified I 4. Add a new § 372.23 to Subpart B to decades to become familiar with SIC so in the Standard Industrial Classification read as follows: the transition to NAICS as opposed to Manual, 1987, Executive Office of the an alternative industry classification President, Office of Management and § 372.23 SIC and NAICS codes to which this Part applies. system should be more efficient and less Budget. burdensome. Therefore, EPA believes it * * * * * The requirements of this part apply to is appropriate to use NAICS for I 3. Amend § 372.22, by revising facilities in the following SIC and purposes of EPCRA section 313 paragraphs (b) introductory text, (b)(1), NAICS codes. This section contains reporting. (b)(2), (b)(3)(i) and (b)(3)(ii) to read as three listings. Paragraph (a) of this follows: section lists the SIC codes to which this J. The Congressional Review Act part applies. Paragraph (b) of this The Congressional Review Act, 5 § 372.22 Covered facilities for toxic section lists the NAICS codes that U.S.C. 801 et seq., as added by the Small chemical release reporting. correspond to SIC codes 20 through 39 Business Regulatory Enforcement * * * * * to which this part applies. Paragraph (c) Fairness Act of 1996, generally provides (b) The facility is in a Standard of this section lists the NAICS codes that before a rule may take effect, the Industrial Classification (SIC) (as in that correspond to SIC codes other than agency promulgating the rule must effect on January 1, 1987) major group SIC codes 20 through 39 to which this submit a rule report, which includes a or industry code listed in § 372.23(a) part applies. copy of the rule, to each House of the (for which the corresponding North (a) SIC codes.

Major group or industry code Exceptions and/or limitations

10 ...... Except 1011, 1081, and 1094. 12 ...... Except 1241. 20 through 39 4911, 4931, 4939 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 4953 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, 42 U.S.C. 6921, et seq.

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Major group or industry code Exceptions and/or limitations

5169 5171 7389 ...... Limited to facilities primarily engaged in solvent recovery services on a contract or fee basis.

(b) NAICS codes that correspond to SIC codes 20 through 39.

Subsector code or industry code Exceptions and/or limitations

311 ...... Except 311119—Exception is limited to facilities primarily engaged in Custom Grain Grinding for Animal Feed (previously classified under SIC 0723, Crop Preparation Services for Market, Except Cotton Ginning); Except 311330—Exception is limited to facilities primarily engaged in the retail sale of candy, nuts, popcorn and other confections not for immediate consumption made on the premises (previously classified under SIC 5441, Candy, Nut, and Confectionery Stores); Except 311340—Exception is limited to facilities primarily engaged in the retail sale of candy, nuts, popcorn and other confections not for immediate consumption made on the premises (previously classified under SIC 5441, Candy, Nut, and Confectionery Stores); Except 311811—Retail Bakeries (previously classified under SIC 5461, Retail Bakeries); Except 311611—Exception is limited to facilities primarily engaged in Custom Slaughtering for individuals (previously classified under SIC 0751, Livestock Services, Except Veterinary, Slaughtering, custom: for in- dividuals); Except 311612—Exception is limited to facilities primarily engaged in the cutting up and resale of purchased fresh carcasses for the trade (including boxed beef), (previously classified under SIC 5147, Meats and Meat Products); 312 ...... Except 312229—Exception is limited to facilities primarily engaged in providing Tobacco Sheeting Services (previously classified under SIC 7389, Business Services, NEC); 313 ...... Except 313311—Exception is limited to facilities primarily engaged in converting broadwoven piece goods and broadwoven textiles, (previously classified under SIC 5131, Piece Goods Notions, and Other Dry Goods, broadwoven and non-broadwoven piece good converters), and facilities primarily engaged in sponging fabric for tailors and dressmakers (previously classified under SIC 7389, Business Services, NEC (Sponging fabric for tailors and dressmakers)); Except 313312—Exception is limited to facilities primarily engaged in converting narrow woven Textiles, and narrow woven piece goods, (previously classified under SIC 5131, Piece Goods Notions, and Other Dry Goods, converters, except broadwoven fabric); 314 ...... Except 314121—Exception is limited to facilities primarily engaged in making Custom drapery for retail sale (previously classified under SIC 5714, Drapery, Curtain, and Upholstery Stores); Except 314129—Exception is limited to facilities primarily engaged in making Custom slipcovers for retail sale (previously classified under SIC 5714, Drapery, Curtain, and Upholstery Stores); Except 314999—Exception is limited to facilities primarily engaged in Binding carpets and rugs for the trade, Carpet cutting and binding, and Embroidering on textile products (except apparel) for the trade (previously classified under SIC 7389, Business Services Not Elsewhere Classified, Embroidering of advertising on shirts and Rug binding for the trade); 315 ...... Except 315222—Exception is limited to custom tailors primarily engaged in making and selling men’s and boys’ suits, cut and sewn from purchased fabric (previously classified under SIC 5699, Miscellaneous Ap- parel and Accessory Stores (custom tailors)); Except 315223—Exception is limited to custom tailors primarily engaged in making and selling men’s and boys’ dress shirts, cut and sewn from purchased fabric (previously classified under SIC 5699, Miscella- neous Apparel and Accessory Stores (custom tailors)); Except 315233—Exception is limited to custom tailors primarily engaged in making and selling bridal dresses or gowns, or women’s, misses’ and girls’ dresses cut and sewn from purchased fabric (except apparel con- tractors)(custom dressmakers) (previously classified under SIC Code 5699, Miscellaneous Apparel and Ac- cessory Stores); 316 321 322 323 ...... Except 323114—Exception is limited to facilities primarily engaged in reproducing text, drawings, plans, maps, or other copy, by blueprinting, photocopying, mimeographing, or other methods of duplication other than printing or microfilming (i.e., instant printing) (previously classified under SIC 7334, Photocopying and Duplicating Services, (instant printing)); 324 325 ...... Except 325998—Exception is limited to facilities primarily engaged in Aerosol can filling on a job order or contract basis (previously classified under SIC 7389, Business Services, NEC (aerosol packaging)); 326 ...... Except 326212—Tire Retreading, (previously classified under SIC 7534, Tire Retreading and Repair Shops (rebuilding)); 327 331 332 333 334 ...... Except 334611—Software Reproducing (previously classified under SIC 7372, Prepackaged Software, (re- production of software));

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Subsector code or industry code Exceptions and/or limitations

Except 334612—Exception is limited to facilities primarily engaged in mass reproducing pre-recorded Video cassettes, and mass reproducing Video tape or disk (previously classified under SIC 7819, Services Allied to Motion Picture Production (reproduction of Video)); 335 ...... Except 335312—Exception is limited to facilities primarily engaged in armature rewinding on a factory basis (previously classified under SIC 7694 (Armature Rewinding Shops (remanufacturing)); 336 337 ...... Except 337110—Exception is limited to facilities primarily engaged in the retail sale of household furniture and that manufacture custom wood kitchen cabinets and counter tops (previously classified under SIC 5712, Furniture Stores (custom wood cabinets)); Except 337121—Exception is limited to facilities primarily engaged in the retail sale of household furniture and that manufacture custom made upholstered household furniture (previously classified under SIC 5712, Furniture Stores (upholstered, custom made furniture)); Except 337122—Exception is limited to facilities primarily engaged in the retail sale of household furniture and that manufacture nonupholstered, household type, custom wood furniture (previously classified under SIC 5712, Furniture Stores (custom made wood nonupholstered household furniture except cabinets)); 339 ...... Except 339115—Exception is limited to lens grinding facilities that are primarily engaged in the retail sale of eyeglasses and contact lenses to prescription for individuals (previously classified under SIC 5995, Optical Goods Stores (optical laboratories grinding of lenses to prescription)); Except 339116—Dental Laboratories (previously classified under SIC 8072, Dental Laboratories); 111998 ...... Limited to facilities primarily engaged in reducing maple sap to maple syrup (previously classified under SIC 2099, Food Preparations, NEC, Reducing Maple Sap to Maple Syrup); 211112 ...... Limited to facilities that recover sulfur from natural gas (previously classified under SIC 2819, Industrial Inor- ganic Chemicals, NEC (recovering sulfur from natural gas)); 212324 ...... Limited to facilities operating without a mine or quarry and that are primarily engaged in beneficiating kaolin and clay (previously classified under SIC 3295, Minerals and Earths, Ground or Otherwise Treated (grind- ing, washing, separating, etc. of minerals in SIC 1455)); 212325 ...... Limited to facilities operating without a mine or quarry and that are primarily engaged in beneficiating clay and ceramic and refractory minerals (previously classified under SIC 3295, Minerals and Earths, Ground or Otherwise Treated (grinding, washing, separating, etc. of minerals in SIC 1459)); 212393 ...... Limited to facilities operating without a mine or quarry and that are primarily engaged in beneficiating chem- ical or fertilizer mineral raw materials (previously classified under SIC 3295, Minerals and Earths, Ground or Otherwise Treated (grinding, washing, separating, etc. of minerals in SIC 1479)); 212399 ...... Limited to facilities operating without a mine or quarry and that are primarily engaged in beneficiating non- metallic minerals (previously classified under SIC 3295, Minerals and Earths, Ground or Otherwise Treated (grinding, washing, separating, etc. of minerals in SIC 1499)); 488390 ...... Limited to facilities that are primarily engaged in providing routine repair and maintenance of ships and boats from floating drydocks (previously classified under SIC 3731, Shipbuilding and Repairing (floating drydocks not associated with a shipyard)); 511110 511120 511130 511140 ...... Except facilities that are primarily engaged in furnishing services for direct mail advertising including Address list compilers, Address list publishers, Address list publishers and printing combined, Address list pub- lishing, Business directory publishers, Catalog of collections publishers, Catalog of collections publishers and printing combined, Mailing list compilers, Directory compilers, and Mailing list compiling services (pre- viously classified under SIC 7331, Direct Mail Advertising Services (mailing list compilers)); 511191 511199 512220 512230 ...... Except facilities primarily engaged in Music copyright authorizing use, Music copyright buying and licensing, and Music publishers working on their own account (previously classified under SIC 8999, Services, NEC (music publishing)); 516110 ...... Limited to facilities primarily engaged in Internet newspaper publishing (previously classified under SIC 2711, Newspapers: Publishing, or Publishing and Printing), Internet periodical publishing (previously classified under SIC 2721, Periodicals: Publishing, or Publishing and Printing), Internet book publishing (previously classified under SIC 2731, Books: Publishing, or Publishing and Printing), Miscellaneous Internet pub- lishing (previously classified under SIC 2741, Miscellaneous Publishing), Internet greeting card publishers (previously classified under SIC 2771, Greeting Cards); 541710 ...... Limited to facilities that are primarily engaged in Guided missile and space vehicle engine research and de- velopment (previously classified under SIC 3764, Guided Missile and Space Vehicle Propulsion Units and Propulsion Unit Parts), and in Guided missile and space vehicle parts (except engines) research and de- velopment (previously classified under SIC 3769, Guided Missile and Space Vehicle Parts and Auxiliary Equipment, Not Elsewhere Classified); 811490 ...... Limited to facilities that are primarily engaged in repairing and servicing pleasure and sail boats without re- tailing new boats (previously classified under SIC 3732, Boat Building and Repairing (pleasure boat build- ing));

(c) NAICS codes that correspond to SIC codes other than SIC codes 20 through 39.

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Subsector or industry code Exceptions and/or limitations

212111 212112 212113 212221 212222 212231 212234 212299 221111 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 221112 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 221113 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 221119 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 221121 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 221122 ...... Limited to facilities that combust coal and/or oil for the purpose of generating power for distribution in com- merce. 424690 424710 425110 ...... Limited to facilities previously classified in SIC 5169, Chemicals and Allied Products, Not Elsewhere Classi- fied. 425120 ...... Limited to facilities previously classified in SIC 5169, Chemicals and Allied Products, Not Elsewhere Classi- fied. 562112 ...... Limited to facilities primarily engaged in solvent recovery services on a contract or fee basis (previously clas- sified under SIC 7389, Business Services, NEC); 562211 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, subtitle C, 42 U.S.C. 6921 et seq. 562212 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, subtitle C, 42 U.S.C. 6921 et seq. 562213 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, subtitle C, 42 U.S.C. 6921 et seq. 562219 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, subtitle C, 42 U.S.C. 6921 et seq. 562920 ...... Limited to facilities regulated under the Resource Conservation and Recovery Act, subtitle C, 42 U.S.C. 6921 et seq.

I 5. Amend § 372.38 by revising threshold has been met under § 372.25, § 372.85 Toxic chemical release reporting paragraphs (e), (g), and (h) to read as § 372.27, or § 372.28, or determining the form and instructions. follows: amounts to be reported under § 372.30. * * * * * (h) Metal mining overburden. If a (b) * * * § 372.38 Exemptions. toxic chemical that is a constituent of (5) The four-digit SIC code(s) for the * * * * * overburden is processed or otherwise facility or establishments in the facility (e) Certain owners of leased property. used by facilities in SIC code 10, or in until the reporting year ending The owner of a covered facility is not NAICS codes 212221, 212222, 212231, December 31, 2005, for which reporting subject to reporting under § 372.30 if 212234 or 212299, a person is not forms are due July 1, 2006. Beginning such owner’s only interest in the facility required to consider the quantity of the with the reporting year ending is ownership of the real estate upon toxic chemical so processed, or December 31, 2006, for which reporting which the facility is operated. This otherwise used when determining forms are due July 1, 2007, and for each exemption applies to owners of facilities whether an applicable threshold has subsequent reporting year, the six-digit such as industrial parks, all or part of been met under § 372.25, § 372.27, or NAICS code(s) for the facility or which are leased to persons who operate § 372.28, or determining the amounts to establishments in the facility. establishments in any SIC code or be reported under § 372.30. * * * * * NAICS code in § 372.23 that is subject I 8. Amend § 372.95 by revising to the requirements of this part, where I 6. Amend § 372.45 by revising paragraph (b)(10) to read as follows: the owner has no other business interest paragraph (a)(1) to read as follows: in the operation of the covered facility. § 372.45 Notification about toxic § 372.95 Alternate threshold certification * * * * * chemicals. and instructions. (g) Coal extraction activities. If a toxic (a) * * * * * * * * chemical is manufactured, processed, or (b) * * * (1) Is in SIC codes 20 through 39 or otherwise used in extraction by facilities (10) The four-digit SIC code(s) for the a NAICS code that corresponds to SIC in SIC code 12, or in NAICS codes facility or establishments in the facility codes 20 through 39 as set forth in 212111, 212112 or 212113, a person is until the reporting year ending § 372.23(b), not required to consider the quantity of December 31, 2005, for which reporting the toxic chemical so manufactured, * * * * * forms are due July 1, 2006. Beginning processed, or otherwise used when I 7. Amend § 372.85 by revising with the reporting year ending determining whether an applicable paragraph (b)(5) to read as follows: December 31, 2006, for which reporting

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forms are due July 1, 2007, and for each NAICS code(s) for the facility or subsequent reporting year, the six-digit establishments in the facility. * * * * * [FR Doc. 06–5131 Filed 6–5–06; 8:45 am] BILLING CODE 6560–50–P

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Proposed Rules Federal Register Vol. 71, No. 108

Tuesday, June 6, 2006

This section of the FEDERAL REGISTER electronic mail at funds for scientific meetings and for contains notices to the public of the proposed [email protected]. postdoctoral researchers. issuance of rules and regulations. The purpose of these notices is to give interested SUPPLEMENTARY INFORMATION: Postdoctoral Fellowships persons an opportunity to participate in the Overview Current provisions indicate a rule making prior to the adoption of the final postdoctoral fellowship applicant rules. The Cooperative State Research, should not have received a doctoral Education, and Extension Service degree before January 1 of the fiscal year DEPARTMENT OF AGRICULTURE (CSREES) proposes revisions to the three years prior to the submission of administrative provisions for the the proposal and not later than June 15 Cooperative State Research, National Research Initiative Competitive of the fiscal year during which the Education, and Extension Service Grants Program (NRICGP), which was proposal is submitted (7 CFR authorized in section 2(b) of the Act of 3411.3(d)(1)(i)). In the past, NRICGP 7 CFR Part 3411 August 4, 1965, as amended by section proposal submission dates were 1615 of the Food, Agriculture, grouped together and occurred within RIN 0524–AA32 Conservation, and Trade Act of 1990 an approximate range of three to four months. As a result, applicants had National Research Initiative (FACT Act), (7 U.S.C. 450i(b)). Some of similar amounts of time from the date Competitive Grants Program— the revisions are mere technical they submitted their proposals until Revisions to Administrative Provisions corrections, including updates to the Agency’s name. Other revisions reflect they were notified of awards. This was AGENCY: Cooperative State Research, the Agency’s developing capabilities to important because applicants used the Education, and Extension Service, exchange proposal and grant data time to arrange for postdoctoral USDA. electronically. Finally, CSREES positions and ensure continuity of ACTION: Proposed rule. proposes substantive revisions to the funding for their postdoctoral research. eligibility requirements for Agricultural Now, however, NRICGP proposal SUMMARY: The Cooperative State Research Enhancement Awards (7 CFR submission dates are spread throughout Research, Education, and Extension 3411.3(d)) and the Agency’s instructions the year. The current provisions put at Service (CSREES) proposes to update to applicants preparing project budgets a disadvantage postdoctoral fellowship and make technical corrections to the for NRICGP conference grants and applicants to NRICGP programs with administrative provisions for the postdoctoral fellowships (7 CFR proposal submission dates that are later National Research Initiative Competitive 3411.4(c)(8)). in the fiscal year than the doctoral Grants Program (NRICGP). In addition, degree cutoff date of June 15. In order CSREES proposes substantive revisions The Agricultural Research to ensure the availability of their to 7 CFR 3411.3(d), the ‘‘Eligibility Enhancement Awards are intended to awards, applicants to these programs requirements’’ for NRICGP Postdoctoral help institutions develop competitive may wait a year between receiving their Fellowships, New Investigator Awards, research programs and to attract doctoral degrees and applying for the and Strengthening Awards, and to 7 scientists to research in agriculture, postdoctoral fellowships. The gap in CFR 3411.4(c)(8), Agency instructions to food, and environmental sciences. To funding can result in postdoctoral applicants preparing project budgets for increase the impact of the Agricultural researchers leaving agricultural research NRICGP conference grants and Research Enhancement Awards, because they cannot find a laboratory postdoctoral fellowships. CSREES CSREES proposes changing the with sufficient funding to support them anticipates the proposed changes to the eligibility requirements for Postdoctoral during this interim. eligibility requirements would increase Fellowships, New Investigator Awards, CSREES proposes revising the the impact of the Agricultural Research and Strengthening Awards. Anticipated provisions for NRICGP postdoctoral Enhancement Awards, while the impacts would include: (1) For fellowships to base cutoff dates for proposed changes to the budget Postdoctoral Fellowships, improved receipt of doctoral degrees on proposal instructions would facilitate additional funding continuity and potentially more due dates for specific NRICGP programs. conference and postdoctoral fellowship postdoctoral scientists entering into an This change would add equity to the awards. agricultural research career; (2) for New process and allow applicants sufficient Investigator Awards, improved project DATES: time to make arrangements for financial The Agency must receive design and increased probability of a comments on or before August 7, 2006. support of their postdoctoral research successful agricultural research prior to graduation. In doing so, it ADDRESSES: Comments should be sent to program; and (3) for Strengthening should further the engagement of the Erin Daly; United States Department of Awards, improved research project best and brightest young scientists in Agriculture; Cooperative State Research, continuity and more incentive for agricultural research. Education, and Extension Service, STOP researchers to stay at USDA- 2299, 1400 Independence Ave., SW., Experimental Program for Stimulating New Investigator Awards Washington, DC 20250–2299. Competitive Research (EPSCoR) or The current provisions require that, in Comments may also be sent via small/mid-sized institutions. The addition to the Project Director, all co- electronic mail to proposed revisions to Agency Project Directors must meet NRICGP [email protected]. instructions regarding the preparation of New Investigator Award eligibility FOR FURTHER INFORMATION CONTACT: Gail project budgets apply narrowly and requirements (7 CFR 3411.3(d)(2)). McLean at (202) 401–6060 or via should optimize the use of NRICGP When evaluating the scientific merit of

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a proposal, reviewers frequently suggest past. The Agency believes this will believes the administrative costs are that New Investigators work with increase the likelihood that investigators negligible. established investigators. Established at institutions in EPSCoR states, and In accordance with its fiscal year 2006 investigators can provide valuable those at institutions with small to mid- Request for Applications (RFA) for expertise on scientific subjects and sized enrollment, will have the funding NRICGP (available at http:// experimental methods that New stability necessary for successful www.csrees.usda.gov/funding/rfas/ Investigators need for successful agricultural research programs. Often nri_rfa.html), CSREES allows research projects. The interaction researchers from these institutions have postdoctoral fellowship awardees to between New Investigators and difficulty renewing strengthening request an institutional allowance (not established investigators can be more awards. Although their projects have to exceed $2,400 per year) or indirect than simple collaboration and require important scientific merit, they tend to costs within the $125,000 maximum sharing of funds and significant be limited in size and scope due to, for award limit. Postdoctoral fellowship interaction. The current eligibility example, teaching commitments, applicants primarily request funds for requirements for New Investigator equipment access, and smaller numbers salary support, although they are Awards inhibit, if not prevent, these of students and postdoctoral allowed to request other expenditures close relationships. CSREES proposes researchers. Thus, these proposals do (e.g., supplies, travel, and publication) if revising the eligibility requirements for not compete well against projects from they properly justify them. These New Investigator Awards so that they larger research institutions that have awards allow postdoctoral researchers apply to Project Directors only. As the more resources and personnel. This to develop independent research Project Director, the New Investigator change will improve funding continuity projects they can take with them to would maintain the primary and provide incentives for established career-track positions. Postdoctoral responsibility for the research and the researchers to stay at EPSCoR or small/ fellowships play an important role in funding. mid-sized institutions. In doing so, it attracting and supporting beginning Currently, applicants are ineligible for will strengthen the institutions and the researchers in agricultural sciences. For New Investigator Awards if they have future of agricultural research through postdoctoral fellowships, CSREES received competitively-awarded Federal increased opportunities for students to proposes that it continue to indicate in research funds beyond the level of pre- participate in active, successful its annual NRICGP RFA a maximum or postdoctoral research awards (7 CFR agricultural research projects. institutional allowance, and that, in 3411.3(d)(2)). As a result, CSREES is not The current provisions require that, in accordance with revised administrative able to make New Investigator Awards addition to the Project Director, all co- provisions, the Agency plans to make to former recipients of NRICGP seed Project Directors must meet NRICGP this allowance available to awardees in grants. NRICGP seed grants are Strengthening Award eligibility lieu of indirect costs. relatively small awards that enable requirements (7 CFR 3411.3(d)(3)(ii)(B)). CSREES is soliciting public comments investigators to collect preliminary data As with a similar restriction placed on regarding this proposed rule and will they can use to prepare standard consider and address such comments in research grant applications. Seed grant New Investigators, this requirement unnecessarily hampers close subsequent rulemaking on this subject. eligibility is limited to faculty with Comments should be submitted as appointments at (1) small and mid-sized relationships between investigators who can provide expertise needed to provided for in the ADDRESSES and degree-granting institutions that are not DATES portions of this proposed rule. in the top 100 most successful successfully complete a project. CSREES institutions; and (2) degree-granting proposes revising the eligibility Paperwork Reduction Act of 1995— institutions eligible for USDA–EPSCoR requirements for these types of NRICGP Information Collection Strengthening Awards so that they funding. CSREES proposes revising the Under the provisions of the apply to Project Directors only. NRICGP New Investigator Award Paperwork Reduction Act of 1995 (44 provisions so that former recipients of Indirect Costs—Conference Awards and U.S.C. chapter 35), the collection of NRICGP seed grants are eligible to apply Postdoctoral Fellowships information requirements contained in for these funds. By allowing this Proposed Rule have been approved investigators who received seed grants CSREES proposes adding language to (OMB Approval No. 0524–0039). to remain eligible for New Investigator 7 CFR 3411.4(c)(8) that prohibits Awards, CSREES hopes to increase the indirect costs for conference awards and Regulatory Flexibility Act chances that beginning scientists will postdoctoral fellowships. Currently, USDA certifies that this proposed rule achieve funding and continuation of CSREES restricts conference awardees’ will not have a significant impact on a agricultural research projects. recovery of indirect costs to 20% of total substantial number of small entities as Federal funds, as provided in Section defined in the Regulatory Flexibility Strengthening Awards 709 of the Agriculture, Rural Act, Public Law 96–354, as amended (5 According to the eligibility Development, Food and Drug U.S.C. 601, et seq.) because it is a requirements for Research Career Administration, and Related Agencies Federal assistance program, not a Enhancement Awards, Seed Grants, and Appropriations Act, 2006 (Pub. L. 109– regulatory regime, and the majority of Strengthening Standard Research 97). Conference awards support awards will be made to colleges and Project Awards, no investigators on the meetings that bring together scientists to universities that do not qualify as small Proposal Cover Page may have received identify research needs, update entities. a USDA NRICGP competitive research information, or advance an area of grant within the last 5 years (7 CFR research. Typically, these awards are Executive Order 12866 3411.3(d)(3)(ii)(A)). CSREES proposes modest. They rarely exceed $10,000, but This rule has been reviewed under removing this restriction so that are recognized as integral to research Executive Order 12866 and has been investigators from eligible institutions efforts. Where grantees incur determined to be nonsignificant as it can apply for these types of administrative costs relative to will not create a serious inconsistency Strengthening Awards regardless of sponsoring such conferences (especially or otherwise interfere with an action having received NRICGP awards in the in off-site locations), the Agency planned by another agency; will not

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materially alter the budgetary impact of between the national government and has the eventual goal of technology entitlement, grants, user fees, or loan the States, or on the distribution of transfer and education capacity through programs, or rights and obligations of power and responsibilities among the the acquisition of special research the recipients thereof; and will not raise various levels of government. Nor does equipment and improvement of novel legal or policy issues arising out this rule impose substantial direct teaching and education, including of legal mandates, the President’s compliance costs on State and local fellowships; single investigators or priorities, or principles set forth in this governments. coinvestigators who are beginning their Executive Order. This rule will not have research careers; and, faculty of small Executive Order 12372 an annual effect on the economy of $100 and mid-sized institutions not million or more or adversely affect in a For the reasons set forth in the Final previously successful in obtaining material way the economy, productivity, Rule Related Notice for 7 CFR part 3015, competitive grants under this competition, jobs, the environment, subpart V (48 FR 29115, June 24, 1983), subsection. In accordance with Public public health, or safety, or State, local, this program is excluded from the scope Law 104–127, within the Department of or Tribal governments or communities. of the Executive Order 12372 which Agriculture, the Secretary established requires intergovernmental consultation the National Agricultural Research, Unfunded Mandates Reform Act with State and local officials. This Extension, Education, and Economics Pursuant to Title II of the Unfunded program does not directly affect State Advisory Board (NAREEEAB) to provide Mandates Reform Act of 1995 (Pub. L. and local governments. overall guidance to the Research, 104–4), the Department assessed the Executive Order 13175 Education and Economics mission area effects of this rulemaking action on on policies and priorities related to State, local, and Tribal government, and The policies contained in this programs, including NRICGP. In the public. This action does not compel rulemaking do not have tribal addition to the stakeholder listening the expenditure of $100 million or more implications and thus no further action sessions NAREEEAB sponsors, CSREES by any State, local, or Tribal is required under Executive Order receives stakeholder input on policies governments, or anyone in the private 13175. and priorities related to NRICGP from sector. Therefore, a statement under List of Subjects in 7 CFR Part 3411 multiple sources including scientific Section 202 of the Unfunded Mandates societies; the National Research Council Agricultural research, Grant Reform Act of 1995 is not required. of the National Academy of Sciences; programs—agriculture, Reporting and producers, processors, industry; the Small Business Regulatory Enforcement recordkeeping requirements. Fairness Act land-grant university system; non- For the reasons stated in the governmental organizations; and other This rule is not a major rule under 5 preamble, the Cooperative State federal agencies; and through U.S.C. 804(2), the Small Business Research, Education, and Extension international coordination. The Regulatory Enforcement Fairness Act. Service proposes to amend 7 CFR part Administrator of CSREES shall This rule: 3411 to read as set forth below: determine and announce, through (1) Does not have an annual effect on PART 3411—NATIONAL RESEARCH publication of a notice on the CSREES the economy of $100 million or more; Web site (http://www.csrees.usda.gov), (2) Will not cause a major increase in INITIATIVE COMPETITIVE GRANTS PROGRAM the government-wide funding costs or prices for consumers, opportunities Web site (http:// individual industries, Federal, State, or 1. The authority citation for part 3411 www.grants.gov), or in such local government agencies, or continues to read as follows: publications as the Federal Register, geographic regions; and professional trade journals, agency or (3) Does not have significant adverse Authority: Sec. 2(i) of the Act of August 4, program handbooks, the Catalog of effects on competition, employment, 1965, as amended (7 U.S.C. 450i(i)). Federal Domestic Assistance, or any investment, productivity, innovation, or Subpart A—General other appropriate means, high-priority the ability of U.S.-based enterprises to research areas and categories for which compete with foreign-based enterprises. 2. Revise paragraph (a) of § 3411.1 to proposals will be solicited and the read as follows: Executive Order 12988 extent that funds are made available This rule has been reviewed under § 3411.1 Applicability of regulations. therefore. Executive Order 12988, Civil Justice (a) The regulations of this part apply * * * * * Reform. In accordance with the to competitive research grants awarded 3. Revise paragraphs (a) and (c) of Executive Order: (1) All State and local under the authority of section 2(b) of the § 3411.2 to read as follows: laws and regulations that are in conflict Act of August 4, 1965, as amended by with this rule will be preempted; (2) no section 1615 of the Food, Agriculture, § 3411.2 Definitions. retroactive effect will be given to this Conservation, and Trade Act of 1990 * * * * * (FACT Act), (7 U.S.C. 450i(b)), for the rule; (3) no administrative proceedings (a) Administrator means the support of research to further the are required before bringing any judicial Administrator of the Cooperative State programs of the Department of action regarding this rule. Research, Education, and Extension Agriculture and to improve research Service (CSREES) and any other officer Executive Order 13132 capabilities in the agricultural, food, or employee of the Department of In accordance with Executive Order and environmental sciences in the Agriculture to whom the authority 13132, this rulemaking does not have following categories: Single involved may be delegated. sufficient federalism implications to investigators or coinvestigators in the warrant the preparation of a Federalism same disciplines; teams of researchers * * * * * Assessment. The policies contained in from different disciplines; (c) Project Director means a single this rule do not have any substantial multidisciplinary teams for long-term individual who is responsible for the direct effect on policymaking discretion applied research problems; scientific and technical direction of the of the States, on the relationship multidisciplinary teams whose research project, as designated by the grantee in

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the grant application and approved by to Research Career Enhancement purpose, along with instructions for the Administrator. Awards, Seed Grants, and Strengthening completion, is included in the NRICGP * * * * * Standard Research Project Awards: Application Kit identified under 4. Amend § 3411.3 by revising (A) The Project Director listed on the § 3411.4(b) of the part and may be paragraphs (a), (d) introductory text, Application For Funding must be from reproduced as needed by applicants. (d)(1) introductory text, (d)(1)(i), (d)(2), a small or mid-sized institution that is Funds may be requested under any of and (d)(3)(ii) to read as follows: not among the top 100 universities and the categories listed, provided that the colleges for receiving Federal funds for item or service for which support is § 3411.3 Eligibility requirements. science and engineering research as requested may be identified as * * * * * specified in the annual program necessary for successful conduct of the (a) For research projects, except where solicitation or must be from an proposed project, is allowable under otherwise prohibited by law, State institution located in a USDA–EPSCoR applicable Federal cost principles, and agricultural experiment stations, all state. is not prohibited under any applicable colleges and universities, other research (B) Every investigator listed on the Federal statute or regulation. It should institutions and organizations, Federal Application For Funding must have an be noted, for example, that section agencies, private organizations or appointment at a degree granting 2(b)(7) of the Act of August 4, 1965, as corporations, and individuals shall be institution. amended, prohibits the use of funds eligible to apply for and receive a 5. Amend § 3411.4 by revising under this program for the renovation or competitive grant under this part, paragraphs (a) introductory text, (a)(4), refurbishment of research spaces, provided that the applicant qualifies as (a)(5), (c)(3) introductory text, (c)(7) purchases or installation of fixed a responsible grantee under the criteria introductory text, (c)(8), (c)(11), and equipment in such spaces, or for the set forth in paragraph (b) of this section. (c)(13) to read as follows: planning, repair, rehabilitation, * * * * * § 3411.4 How to apply for a grant. acquisition, or construction of a (d) Agricultural Research (a) Program solicitations will be building or facility. Also, section 2(b)(8) Enhancement Awards. In addition to prepared and announced through of the Act of August 4, 1965, as paragraphs (a), (b), and (c) of this publication on the government-wide amended, requires that all grants, except section, the following eligibility funding opportunities Web site (http:// equipment grants authorized by section requirements apply to Agricultural www.grants.gov) as early as practicable 2(b)(3)(D) of the same Act, awarded Research Enhancement Awards for each fiscal year. It will contain under this part, shall be used without research projects (Program reserves the information sufficient to enable all regard to matching funds or cost right to specify funding limitations and eligible applicants to prepare sharing. Equipment grants may not administrative requirements each year competitive grant proposals and will be exceed 50 percent of the cost of the in the program solicitation): as complete as possible with respect to: equipment to be acquired. Equipment (1) Postdoctoral Fellowships. In grant funds also may not be used for accordance with section 2(b)(3)(D) of the * * * * * (4) Deadline dates for receipt of installation, maintenance, warranty, or Act of August 4, 1965, as amended, insurance expenses. Indirect costs are individuals who recently have received proposal packages; (5) Submission addresses; not permitted on equipment grants, or will soon receive their doctoral conference grants, or postdoctoral * * * * * degree may submit proposals for fellowships. According to the limit postdoctoral fellowships. The following (b) * * * (c) Format for grant proposals. included in the annual program eligibility requirements apply: solicitation, a postdoctoral fellowship (i) The doctoral degree of the * * * * * applicant may request and receive a applicant must be received not earlier (3) Project Description. The specific reasonable institutional allowance. than January 1 of the fiscal year three aims of the project must be included in years prior to the submission of the all proposals. The text of the project * * * * * proposal and not later than nine months description may not exceed 18 single- or (11) Additions to project description. after the proposal due date; double-spaced pages and must contain Each project description is expected by * * * * * the following components: the Administrator, the members of peer (2) New Investigator Awards. Pursuant * * * * * review groups, and the relevant program to section 2(b)(3)(E) of the Act of August (7) Personnel support. To assist peer staff to be complete. However, if the 4, 1965, as amended, Project Directors reviewers in assessing the competence inclusions of additional information is who are beginning their research and experience of the proposed project necessary to ensure the equitable careers, do not have an extensive staff, all personnel who will be involved evaluation of the proposal (e.g., research publication record, and have in the proposed project must be photographs which do not reproduce less than 5 years of post-graduate, identified clearly. For each Project well, reprints, and other pertinent career-track research experience, may Director involved, and for all senior materials which are deemed to be submit proposals as new investigators. associates and other professional unsuitable for inclusion in the text of Applicants may not have received personnel who expect to work on the the proposal), the number of copies competitively-awarded Federal research project, whether or not funds are sought submitted should match the number of funds beyond the level of pre- or for their support, the following should copies of the application requested in postdoctoral research awards or USDA be included: the program solicitation. Each set of NRICGP seed grants. * * * * * such materials must be identified with (3) Strengthening Awards. (8) Budget. A detailed budget is the name of the submitting organization, * * * * * required for each year of requested and the name(s) of the Project (ii) Research Career Enhancement support. In addition, a summary budget Director(s). Information may not be Awards, Seed Grants, and Strengthening is required detailing requested support appended to a proposal to circumvent Standard Research Project Awards. The for the overall project period. A copy of page limitations prescribed for the following eligibility requirements apply the form which must be used for this project description. Extraneous

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materials will not be used during the work to the detriment of applicants support for each subsequent fiscal year. peer review process. during the peer evaluation process. To Decisions regarding continued support * * * * * ensure a comprehensive evaluation, all and the actual funding levels of such (13) National Environmental Policy applications should be written with the support in future years usually will be Act. As outlined in CSREES’s care and thoroughness accorded papers made administratively after implementing regulations of the for publication. consideration of such factors as the National Environmental Policy Act of * * * * * grantee’s progress and management 1969 (NEPA) at 7 CFR part 3407, 7. Amend § 3411.6 as follows: practices and the availability of funds. environmental data or documentation A. Revise paragraph (a), paragraph (b) Since initial peer reviews are based for the proposed project is to be heading, (b)(1)(iii), (b)(1)(iv), (d) upon the full term and scope of the provided to CSREES in order to assist introductory text, (d)(2), and (f). original application, additional CSREES in carrying out its B. Remove and reserve paragraph evaluations of this type generally are not responsibilities under NEPA. These (b)(2). required prior to successive years’ responsibilities include determining support. However, in unusual cases whether the project requires an § 3411.6 Grant awards. (e.g., when the nature of the project or Environmental Assessment or an (a) General. Within the limit of funds key personnel change or when the Environmental Impact Statement or available for such purpose, the awarding amount of future support requested whether it can be excluded from this official shall make grants to those substantially exceeds the grant requirement on the basis of several responsible, eligible applicants whose application originally reviewed and categorical exclusions listed in 7 CFR p proposals are judged most meritorious approved), additional reviews may be art 3407. In this regard, the applicant in the announced program areas under required prior to approving continued should review the categories defined for the evaluation criteria and procedures funding. exclusion to ascertain whether the set forth in this part. All funds granted * * * * * proposed project may fall within one or under this part shall be expended solely (f) Current Research Information more of the exclusions, and should for the purpose for which the funds are Service (CRIS). For each project funded, indicate if it does so on the National granted in accordance with the instructions will be sent to the grantee Environmental Policy Act Exclusions approved application and budget, the for the completion of CRIS Forms AD– Form provided in the NRICGP regulations of this part, the terms and 416, ‘‘Research Work Unit/Project Application Kit. conditions of the award, the applicable Description—Research Resume’’ and * * * * * Federal cost principles, and the AD–417, ‘‘Research Work Unit/Project 6. Revise paragraph (a) of § 3411.5 to Department’s Federal assistance Description—Classification of read as follows: regulations. Research.’’ Grant funds will not be (b) Grant award document. released until the completed forms are § 3411.5 Evaluation and disposition of (1) * * * applications. received electronically via CRIS. (iii) Name(s) and address(es) of 8. Revise paragraph (b)(1) of § 3411.7 (a) Evaluation. All proposals received Project Director(s) chosen to direct and as follows: from eligible applicants and received in control approved activities; accordance with deadlines established (iv) Identifying grant and proposal § 3411.7 Use of funds; changes. in the annual program solicitation shall numbers assigned by the Department; be evaluated by the Administrator * * * * * through such officers, employees, and * * * * * (b) Change in project plans. (1) The others as the Administrator determines (d) Funding mechanisms. The two permissible changes by the grantee, are uniquely qualified in the areas mechanisms by which grants shall be Project Director(s), or other key project represented by particular projects. To awarded are as follows: personnel in the approved grant shall be assist in equitably and objectively * * * * * limited to changes in methodology, evaluating proposals and to obtain the (2) Continuation grant. This is a techniques, or other aspects of the best possible balance of viewpoints, the funding mechanism whereby the project to expedite achievement of the Administrator shall solicit the advice of Department agrees to support a project’s approved goals. If the grantee peer scientists, ad hoc reviewers, and/ specified level of effort for a and/or the Project Director(s) is or others who are recognized specialists predetermined period of time with a uncertain whether a particular change in the areas covered by the applications statement of intention to provide complies with this provision, the received and whose general roles are additional support at a future date, question must be referred to the defined in §§ 3411.2(j) and 3411.2(k). provided that performance has been Administrator for final determination. Specific evaluations will be based upon satisfactory, appropriations are available * * * * * the criteria established in § 3411.15, for this purpose, and continued support 9. In the list of statutes in § 3411.8, unless CSREES determines that different would be in the best interests of the revise the fifth and tenth statutes listed. criteria are necessary for the proper Federal government and the public. evaluation of proposals in one or more This kind of mechanism normally will § 3411.8 Other Federal statutes and specific program areas, or for specific be awarded for an initial one-year regulations that apply. types of projects to be supported, and period, and any subsequent * * * * * announces such criteria and their continuation project grants will also be 7 CFR part 3015—USDA Uniform relative importance in the annual awarded in one-year increments. The Federal Assistance Regulations, program solicitation. The overriding award of a continuation project grant to implementing OMB directives (i.e., purpose of these evaluations is to fund an initial or succeeding budget Circular Nos. A–21 and A–122) and provide information upon which the period does not constitute an obligation incorporating provisions of 31 U.S.C. Administrator may make informed to fund any subsequent budget period. 6301–6308 (formerly, the Federal Grant judgments in selecting proposals for Unless prescribed otherwise by and Cooperative Agreement Act of 1977, ultimate support. Incomplete, unclear, CSREES, a grantee must submit a Pub. L. No. 95–224), as well as general or poorly organized applications will separate application for continued policy requirements applicable to

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recipients of Departmental financial ADDRESSES: Use one of the following GROB FLUGZEUGBAU assistance; addresses to comment on this proposed INDUSTRIESTRABE) Model G102 * * * * * AD: ASTIR CS sailplane caused us to issue 7 CFR part 3407—CSREES procedures • DOT Docket Web site: Go to http:// AD 84–09–05, Amendment 39–4849. to implement the National dms.dot.gov and follow the instructions AD 84–09–05 requires the following for Environmental Policy Act; for sending your comments certain Model G102 ASTIR CS * * * * * electronically. sailplanes: • Government-wide rulemaking Web • Installing a modified spherical Dated: May 31, 2006. site: Go to http://www.regulations.gov locking bolt and nut in the forward Colien Hefferan, and follow the instructions for sending horizontal stabilizer connection to the Administrator, Cooperative State Research, your comments electronically. vertical stabilizer; and Education, and Extension Service. • Mail: Docket Management Facility, • Installing new locking pins in the [FR Doc. E6–8704 Filed 6–5–06; 8:45 am] U.S. Department of Transportation, 400 aft connecting plate for the horizontal BILLING CODE 3410–22–P Seventh Street, SW., Nassif Building, stabilizer. Room PL–401, Washington, DC 20590– The Luftfahrt-Bundesamt (LBA), 0001. which is the airworthiness authority for DEPARTMENT OF TRANSPORTATION • Fax: (202) 493–2251. Germany, notified the FAA of the need • Hand Delivery: Room PL–401 on to supersede AD 84–09–05 to address an Federal Aviation Administration the plaza level of the Nassif Building, unsafe condition that may exist or could 400 Seventh Street, SW., Washington, develop on GROB Model G102 ASTIR 14 CFR Part 39 DC, between 9 a.m. and 5 p.m., Monday CS sailplanes. The LBA reports an incident of the [Docket No. FAA–2006–24253; Directorate through Friday, except Federal holidays. Identifier 2006–CE–23–AD] For service information identified in modified spherical locking bolt found this proposed AD, contact GROB Luft- broken on one of the affected sailplanes RIN 2120–AA64 und Raumfahrt, Lettenbachstrasse 9, D– after landing. Investigation revealed that fatigue, Airworthiness Directives; GROB– 86874 Tussenhausen-Mattsies, Federal Republic of Germany; telephone: 011 49 resulting from alternating stress on the WERKE GMBH & CO KG Model G102 stabilizer during unsymmetrical ASTIR CS Sailplanes 8268 998139; fax: 011 49 8268 998200; e-mail: productsupport@grob- loading, caused the spherical locking AGENCY: Federal Aviation aerospace.de. bolt to crack. Administration (FAA), Department of This condition, if not corrected, could FOR FURTHER INFORMATION CONTACT: Transportation (DOT). result in failure of the horizontal Gregory A. Davison, Aerospace stabilizer connection. This failure could ACTION: Notice of proposed rulemaking Engineer, ACE–112, Small Airplane lead to loss of control. (NPRM). Directorate, 901 Locust, Room 301, Relevant Service Information SUMMARY: We propose to supersede Kansas City, Missouri 64106; telephone: Airworthiness Directive (AD) 84–09–05, (816) 329–4130; facsimile: (816) 329– We have reviewed GROB Service which applies to certain GROB–WERKE 4090. Bulletin MSB306–38/1, dated November 28, 2005, and GROB Service Bulletin GMBH & CO KG (previously identified SUPPLEMENTARY INFORMATION: as BURKHART–GROB FLUGZEUGBAU MSB306–38, dated February 12, 2004. INDUSTRIESTRABE) Model G102 Comments Invited These service bulletins specify doing the following: ASTIR CS sailplanes. AD 84–09–05 We invite you to send any written • requires you to install a modified relevant data, views, or arguments Removing and replacing the spherical locking bolt with a new bolt, spherical locking bolt and nut in the regarding this proposed AD. Send your part number (P/N) 102–3500.21; forward horizontal stabilizer connection comments to an address listed under the • Removing and replacing all to the vertical stabilizer and install new ADDRESSES section. Include the docket locking pins in the aft connecting plate retaining pins (collar bolts) on the T- number, ‘‘FAA–2006–24253; Directorate plate with new retaining pins, P/N 102– for the horizontal stabilizer. Since we Identifier 2006–CE–23–AD’’ at the issued AD 84–09–05, fatigue cracks 2142.46; beginning of your comments. We • Incorporating Revision 9 into the were found in the modified spherical specifically invite comments on the Maintenance Manual (which may be locking bolt. Consequently, this overall regulatory, economic, downloaded at http://www.Grob- proposed AD would require you to environmental, and energy aspects of Aerospace.de/); replace the modified spherical locking the proposed AD. We will consider all • Adding a life limit to the new bolt, the retaining pins (collar bolts), comments received by the closing date spherical locking bolt and retaining and associated hardware; add a life limit and may amend the proposed AD in pins; and on the spherical locking bolt and the light of those comments. • Inspecting (repetitively) the front retaining pins; and repetitively inspect We will post all comments we and rear horizontal stabilizer attachment the front and rear horizontal stabilizer receive, without change, to http:// assembly after the initial replacements. attachment. This proposed AD results dms.dot.gov, including any personal from mandatory continuing information you provide. We will also Foreign Airworthiness Authority airworthiness information (MCAI) post a report summarizing each Information issued by the airworthiness authority for substantive verbal contact we receive The LBA classified this service Germany. We are proposing this AD to concerning this proposed AD. bulletin as mandatory and issued prevent cracks in the spherical locking German AD Number D–2004–168, dated bolt, which could result in failure of the Discussion March 23, 2004, to ensure the continued horizontal stabilizer connection. This A broken spherical locking bolt in the airworthiness of these sailplanes in failure could lead to loss of control. horizontal stabilizer attachment on a Germany. DATES: We must receive comments on GROB–WERKE GMBH & CO KG (GROB) These GROB Model G102 ASTIR CS this proposed AD by June 29, 2006. (previously identified as BURKHART– sailplanes are manufactured in Germany

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and are type-certificated for operation in This proposed AD would supersede Differences Between This Proposed AD the United States under the provisions AD 84–09–05 with a new AD that would and the Service Information of section 21.29 of the Federal Aviation require you to do the following: The service information specifies • Regulations (14 CFR 21.29) and the Remove the existing spherical using a 20X magnifying glass for doing applicable bilateral airworthiness locking bolt, nut, retaining pins (collar the inspections. This proposed AD agreement. bolts), self-locking nut, and the lock specifies using a dye penetrant method Under this bilateral airworthiness washer; and replace with a new and a 10X magnifying glass for doing agreement, the LBA has kept us spherical locking bolt, P/N 102–3500.21, the inspections. This difference is informed of the situation described that has revision letter ‘‘b’’ permanently because 20X magnifiers are not readily above. marked on the bottom of the bolt, a new available in the field. nut, P/N 102–3510.21, new retaining The requirements of this proposed FAA’s Determination and Requirements pins (collar bolts), P/N 102–2142.46, a of the Proposed AD AD, if adopted as a final rule, would new self-locking nut, P/N LN9348–M8, take precedence over the provisions in We are proposing this AD because we and a new lock washer, P/N DIN 6797– the service information. have examined the LBA’s findings, 10,5PHR. evaluated all information and • Add a life limit on the new Costs of Compliance determined the unsafe condition spherical locking bolt and the retaining We estimate that this proposed AD described previously is likely to exist or pins; and would affect 56 sailplanes in the U.S. develop on other products of the same • Inspect (repetitively) the front and registry. type design that are certificated for rear horizontal stabilizer attachment We estimate the following costs to do operation in the United States. assembly after the initial replacements. the proposed replacements:

Total cost for Total cost on Labor cost Parts cost each sailplane U.S. operators

2 workhours × $80 per hour = $160 ...... $253 $413 $23,128

We estimate the following costs to do each proposed inspection:

Total cost for Total cost on Labor cost Parts cost each sailplane U.S. operators

2 workhours × $80 per hour = $160 ...... Not Applicable $160 $8,960

Authority for This Rulemaking States, on the relationship between the (800) 647–5227) is located at the street national Government and the States, or address stated in the ADDRESSES section. Title 49 of the United States Code on the distribution of power and Comments will be available in the AD specifies the FAA’s authority to issue responsibilities among the various docket shortly after receipt. rules on aviation safety. Subtitle I, levels of government. Section 106, describes the authority of For the reasons discussed above, I List of Subjects in 14 CFR Part 39 the FAA Administrator. Subtitle VII, certify that the proposed regulation: Air transportation, Aircraft, Aviation Aviation Programs, describes in more 1. Is not a ‘‘significant regulatory safety, Safety. detail the scope of the Agency’s action’’ under Executive Order 12866; authority. 2. Is not a ‘‘significant rule’’ under the The Proposed Amendment We are issuing this rulemaking under DOT Regulatory Policies and Procedures Accordingly, under the authority the authority described in Subtitle VII, (44 FR 11034, February 26, 1979); and delegated to me by the Administrator, Part A, Subpart III, Section 44701, 3. Will not have a significant the FAA proposes to amend 14 CFR part ‘‘General requirements.’’ Under that economic impact, positive or negative, 39 as follows: section, Congress charges the FAA with on a substantial number of small entities promoting safe flight of civil aircraft in under the criteria of the Regulatory PART 39—AIRWORTHINESS air commerce by prescribing regulations Flexibility Act. DIRECTIVES for practices, methods, and procedures We prepared a regulatory evaluation the Administrator finds necessary for of the estimated costs to comply with 1. The authority citation for part 39 safety in air commerce. This regulation this proposed AD and placed it in the continues to read as follows: is within the scope of that authority AD docket. Authority: 49 U.S.C. 106(g), 40113, 44701. because it addresses an unsafe condition that is likely to exist or develop on Examining the AD Docket § 39.13 [Amended] products identified in this rulemaking You may examine the AD docket that 2. The FAA amends § 39.13 by action. contains the proposed AD, the removing Airworthiness Directive (AD) regulatory evaluation, any comments Regulatory Findings 84–09–05, Amendment 39–4849, and received, and other information on the adding the following new AD: We have determined that this Internet at http://dms.dot.gov; or in GROB–WERKE GMBH & CO KG (previously proposed AD would not have federalism person at the Docket Management identified as BURKHART–GROB implications under Executive Order Facility between 9 a.m. and 5 p.m., FLUGZEUGBAU INDUSTRIESTRABE): 13132. This proposed AD would not Monday through Friday, except Federal Docket No. FAA–2006–24253; have a substantial direct effect on the holidays. The Docket Office (telephone Directorate Identifier 2006–CE–23–AD.

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Comments Due Date Applicability Germany. We are issuing this AD to prevent (a) We must receive comments on this (c) This AD affects Model G102 ASTIR CS cracks in the spherical locking bolt, which airworthiness directive (AD) action by June sailplanes, serial numbers 1001 through could result in failure of the horizontal stabilizer connection. This failure could lead 29, 2006. 1536, that are certificated in any category. to loss of control. Affected ADs Unsafe Condition (d) This AD results from mandatory Compliance (b) This AD supersedes AD 84–09–05, continuing airworthiness information (MCAI) (e) To address this problem, you must do Amendment 39–4849. issued by the airworthiness authority for the following:

Actions Compliance Procedures

(1) Remove and replace as follows: Within the next 90 days after the effective As specified in GROB Service Bulletin (i) Remove the existing retaining pins (col- date of this AD, unless already done. After MSB306–38/1, dated November 28, 2005, lar bolts) and the self-locking nut and re- doing the replacements, the spherical lock- following the Accomplishment Instructions place with new retaining pins, part num- ing bolt and retaining pins have a life limit in GROB Service Bulletin MSB306–38, bers (P/N) 102–2142.46, and self-locking of 10 years and must be replaced at that dated February 12, 2004, and the Annual nut, P/N LN9348–M8 (or FAA-approved time. Inspection procedures on pages 7 and 8 of equivalent part numbers), on the T-plate; the Astir CS Maintenance Manual, Rev. 9, (ii) Remove the existing spherical locking dated Nov. 2005. bolt and replace with a new spherical locking bolt, P/N 102–3500.21, that has revision letter ‘‘b’’ permanently marked on the bottom of the bolt (or FAA-ap- proved equivalent part number ). Return all replaced spherical locking bolts to Grob Systems, Inc., Aircraft Division, 1070 Navajo Drive, Bluffton, Ohio 45817; (iii) Remove the existing nut and replace with a new nut, P/N 102–3510.21 (or FAA-approved equivalent part number); and (iv) Remove the existing lock washer and replace with a new lock washer, P/N DIN 6796–10,5PHR (or FAA-approved equiv- alent part number). (2) Repetitively inspect the front and rear hori- Initially inspect within the next 100 hours time- As specified in GROB Service Bulletin zontal stabilizer attachment assembly using a in-service (TIS) or at the next annual in- MSB306–38/1, dated November 28, 2005, dye-penetrant method along with a minimum spection after the replacement required in following the Accomplishment Instructions 10X magnifying glass for excessive move- paragraph (e)(1) of this AD, whichever oc- in GROB Service Bulletin MSB306–38, ment, cracks, and/or damage in the spherical curs first. Repetitively inspect thereafter at dated February 12, 2004, and the Annual locking bolt. This inspection method takes 12-month intervals or at intervals not to ex- Inspection procedures on pages 7 and 8 of precedence over the procedures outlined in ceed 100 hours TIS, whichever occurs first. the Astir CS Maintenance Manual, Rev. 9, GROB Service Bulletin MSB306–38, dated dated Nov. 2005. February 12, 2004. (3) If, during any inspection required in para- Before further flight after each inspection re- As specified in GROB Service Bulletin graph (e)(2) of this AD, you find excessive quired in paragraph (e)(2) of this AD. After MSB306–38/1, dated November 28, 2005, movement: each replacement, the spherical locking bolt following the Accomplishment Instructions (i) In the front horizontal stabilizer attach- and the retaining pins have a life limit of 10 in GROB Service Bulletin MSB306–38, ment, you must replace the spherical years and must be replaced at that time. dated February 12, 2004, and the Annual locking bolt with a new part. Inspection procedures on pages 7 and 8 of (ii) In the rear horizontal stabilizer attach- the Astir CS Maintenance Manual, Rev. 9, ment, you must replace the retaining dated Nov. 2005. pins with new parts. (iii) In the front and rear horizontal sta- bilizer attachment after doing the re- placement(s) required in paragraph (e)(3)(i) and (e)(3)(ii) of this AD, you must replace the bearing in the stabilizer spar web. (4) If, during any inspection required in para- Before further flight after each inspection re- As specified in GROB Service Bulletin graph (e)(2) of this AD, you do not find ex- quired in paragraph (e)(2) of this AD. After MSB306–38/1, dated November 28, 2005, cessive movement in the front and rear hori- each replacement, the spherical locking bolt following the Accomplishment Instructions zontal stabilizer attachment: and the retaining pins have a life limit of 10 in GROB Service Bulletin MSB306–38, (i) Inspect the spherical locking bolt for year and must be replaced at that time. dated February 12, 2004, and the Annual cracks and damage using a dye-pene- Inspection procedures on pages 7 and 8 of trant method along with a minimum 10X the Astir CS Maintenance Manual, Rev. 9, magnifying glass. dated Nov. 2005. (ii) If you find cracks or damage on the spherical locking bolt, during the inspec- tion required in paragraph (e)(4)(i) of this AD, you must replace the bolt with a new bolt.

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Actions Compliance Procedures

(5) Do not install any spherical locking bolt, P/N As of the effective date of this AD ...... Not applicable. 102–3500.21 (or FAA-approved equivalent part number), that does not have revision let- ter ‘‘b’’ permanently marked on the bottom of the bolt. (6) 14 CFR 21.303 allows for replacement parts Not Applicable ...... Not Applicable. through parts manufacturer approval (PMA). The phrase ‘‘or FAA-approved equivalent part number’’ in this AD is intended to signify those parts that are PMA parts approved through identicality to the design of the part under the type certificate and replacement parts to correct the unsafe condition under PMA (other than identicality). If parts are in- stalled that are identical to the unsafe parts, then the corrective actions of the AD affect these parts also. In addition, equivalent re- placement parts to correct the unsafe condi- tion under PMA (other than identicality) may also be installed provided they meet current airworthiness standards, which include those actions cited in this AD.

Note: During ground handling, it has been DEPARTMENT OF TRANSPORTATION • Government-wide rulemaking Web noted that a tendency exists for the ground site: Go to http://www.regulations.gov crew to move these gliders by using the Federal Aviation Administration and follow the instructions for sending horizontal stabilizer as a lifting point. This your comments electronically. practice may facilitate damage to the 14 CFR Part 39 • stabilizer assembly and should be avoided. Mail: Docket Management Facility, See Caution note in GROB Service Bulletin [Docket No. FAA–2006–24951; Directorate U.S. Department of Transportation, 400 MSB306–38, dated February 12, 2004. Identifier 2005–NM–184–AD] Seventh Street, SW., Nassif Building, room PL–401, Washington, DC 20590. RIN 2120–AA64 Alternative Methods of Compliance • Fax: (202) 493–2251. (AMOCs) Airworthiness Directives; Gulfstream • Hand Delivery: Room PL–401 on (f) The Manager, Standards Office, Small Model GV and GV–SP Series Airplanes the plaza level of the Nassif Building, Airplane Directorate, FAA, ATTN: Gregory 400 Seventh Street, SW., Washington, A. Davison, Aerospace Engineer, ACE–112, AGENCY: Federal Aviation DC, between 9 a.m. and 5 p.m., Monday Small Airplane Directorate, 901 Locust, Administration (FAA), Department of through Friday, except Federal holidays. Room 301, Kansas City, Missouri 64106; Transportation (DOT). telephone: (816) 329–4130; facsimile: (816) Contact Gulfstream Aerospace ACTION: Notice of proposed rulemaking 329–4090, has the authority to approve Corporation, Technical Publications AMOCs for this AD, if requested using the (NPRM). Dept., P.O. Box 2206, Savannah, Georgia procedures found in 14 CFR 39.19. SUMMARY: The FAA proposes to adopt a 31402–2206, for the service information (g) AMOCs approved for AD 84–09–05 are new airworthiness directive (AD) for identified in this proposed AD. not approved for this AD. certain Gulfstream Model GV and GV– FOR FURTHER INFORMATION CONTACT: Related Information SP series airplanes. This proposed AD Darby Mirocha, Aerospace Engineer, (h) German AD Number D–2004–168, would require repairing the force link Systems and Equipment Branch, ACE– dated March 23, 2004, also addresses the assembly wire harness. This proposed 119A, FAA, Atlanta Aircraft subject of this AD. To get copies of the AD results from a report indicating that Certification Office, One Crown Center, documents referenced in this AD, contact the wiring harness outer shield and 1895 Phoenix Boulevard, suite 450, GROB Luft-und Raumfahrt, Lettenbachstrasse insulation on the primary conductors Atlanta, Georgia 30349; telephone (770) 9, D–86874 Tussenhausen-Mattsies, Federal may have been inadvertently cut due to 703–6095; fax (770) 703–6097. Republic of Germany; telephone: 011 49 8268 998139; fax: 011 49 8268 998200; e-mail: an improper method used to remove the SUPPLEMENTARY INFORMATION: wiring outer jacket. We are proposing [email protected]. To view Comments Invited the AD docket, go to the Docket Management this AD to prevent the loss of the Facility; U.S. Department of Transportation, hardover prevention system (HOPS) in We invite you to submit any relevant 400 Seventh Street, SW., Nassif Building, the roll axis due to a short circuit in the written data, views, or arguments Room PL–401, Washington, DC, or on the wiring harness, which could result in regarding this proposed AD. Send your Internet at http://dms.dot.gov. The docket reduced controllability of the airplane. comments to an address listed in the number is Docket No. FAA–2006–24253; DATES: We must receive comments on ADDRESSES section. Include the docket Directorate Identifier 2006–CE–23–AD. this proposed AD by July 21, 2006. number ‘‘FAA–2006–24951; Directorate Issued in Kansas City, Missouri, on May ADDRESSES: Use one of the following Identifier 2005–NM–184–AD’’ at the 30, 2006. addresses to submit comments on this beginning of your comments. We David R. Showers, proposed AD. specifically invite comments on the Acting Manager, Small Airplane Directorate, • DOT Docket Web site: Go to overall regulatory, economic, Aircraft Certification Service. http://dms.dot.gov and follow the environmental, and energy aspects of [FR Doc. E6–8712 Filed 6–5–06; 8:45 am] instructions for sending your comments the proposed AD. We will consider all BILLING CODE 4910–13–P electronically. comments received by the closing date

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and may amend the proposed AD in Model GIV–X series airplane, a information is intended to adequately light of those comments. technician noticed that the wiring address the unsafe condition. We will post all comments we harness outer shield and insulation on The Gulfstream customer bulletins receive, without change, to http:// the primary conductors were cut. The include Vought Service Bulletin SB– dms.dot.gov, including any personal cuts did not appear to sever the VAIGV/GVSP–27–PG0098, dated May 9, information you provide. We will also electrical wire core, but the potential for 2005, as an additional source of service post a report summarizing each severed wires prompted an investigation information for the repair. substantive verbal contact with FAA by the force link supplier. The personnel concerning this proposed AD. investigation revealed that an improper FAA’s Determination and Requirements Using the search function of that Web method had been used to remove the of the Proposed AD site, anyone can find and read the wiring outer jacket on approximately comments in any of our dockets, 221 affected force links. If this condition We have evaluated all pertinent including the name of the individual causes the hardover prevention system information and identified an unsafe who sent the comment (or signed the (HOPS) to fire inadvertently, the HOPS condition that is likely to exist or comment on behalf of an association, would shut down the hydraulics system develop on other airplanes of this same business, labor union, etc.). You may in that axis, increasing pilot workload. type design. For this reason, we are review DOT’s complete Privacy Act Also, an electrical short circuit in the proposing this AD, which would require Statement in the Federal Register wiring harness could result in loss of accomplishing the actions specified in published on April 11, 2000 (65 FR the HOPS in the roll axis, and the service information described 19477–78), or you may visit http:// consequent reduced controllability of previously, except as discussed below. dms.dot.gov. the airplane. Examining the Docket Clarification of Proposed Repair Relevant Service Information Requirements You may examine the AD docket on the Internet at http://dms.dot.gov, or in We have reviewed Gulfstream G500 The service bulletins do not provide person at the Docket Management Customer Bulletin 14 and G550 corrective action for nicks or other Facility office between 9 a.m. and 5 Customer Bulletin 14 (for Model GV–SP damage found during the inspection of p.m., Monday through Friday, except series airplanes), and Gulfstream GV the environmental seal around the Customer Bulletin 135 (for Model GV Federal holidays. The Docket installed wires. This proposed AD series airplanes), all dated June 23, Management Facility office (telephone would require operators to repair those (800) 647–5227) is located on the plaza 2005. The customer bulletins describe procedures for repairing the force link conditions using a method approved by level of the Nassif Building at the DOT the FAA. street address stated in the ADDRESSES assembly wire harness. The repair section. Comments will be available in includes installing new wiring, visually Costs of Compliance the AD docket shortly after the Docket inspecting the seal around the wires for Management System receives them. nicks and other damage, and visually There are about 99 airplanes of the inspecting the mating ends of the affected design in the worldwide fleet. Discussion connectors to ensure the contacts are The following table provides the While installing an aileron force link properly inserted. Accomplishing the estimated costs for U.S. operators to assembly during the production of a actions specified in the service comply with this proposed AD.

ESTIMATED COSTS

Number of Work Average labor Parts Cost per U.S.-registered Fleet cost hours rate per hour airplane airplanes

3 ...... $80 The manufacturer states that it will supply required parts to the $240 77 $18,480 operators at no cost.

Authority for This Rulemaking safety in air commerce. This regulation For the reasons discussed above, I is within the scope of that authority certify that the proposed regulation: Title 49 of the United States Code because it addresses an unsafe condition specifies the FAA’s authority to issue 1. Is not a ‘‘significant regulatory that is likely to exist or develop on rules on aviation safety. Subtitle I, action’’ under Executive Order 12866; Section 106, describes the authority of products identified in this rulemaking 2. Is not a ‘‘significant rule’’ under the the FAA Administrator. Subtitle VII, action. DOT Regulatory Policies and Procedures Aviation Programs, describes in more Regulatory Findings (44 FR 11034, February 26, 1979); and detail the scope of the Agency’s 3. Will not have a significant authority. We have determined that this economic impact, positive or negative, We are issuing this rulemaking under proposed AD would not have federalism on a substantial number of small entities the authority described in Subtitle VII, implications under Executive Order under the criteria of the Regulatory Part A, Subpart III, Section 44701, 13132. This proposed AD would not Flexibility Act. ‘‘General requirements.’’ Under that have a substantial direct effect on the We prepared a regulatory evaluation section, Congress charges the FAA with States, on the relationship between the of the estimated costs to comply with promoting safe flight of civil aircraft in national Government and the States, or this proposed AD and placed it in the air commerce by prescribing regulations on the distribution of power and AD docket. See the ADDRESSES section for practices, methods, and procedures responsibilities among the various for a location to examine the regulatory the Administrator finds necessary for levels of government. evaluation.

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List of Subjects in 14 CFR Part 39 Comments Due Date improper method used to remove the wiring Air transportation, Aircraft, Aviation (a) The FAA must receive comments on outer jacket. We are issuing this AD to safety, Safety. this AD action by July 21, 2006. prevent the loss of the hardover prevention system (HOPS) in the roll axis due to a short The Proposed Amendment Affected ADs circuit in the wiring harness of the aileron Accordingly, under the authority (b) None. force link assembly, which could result in delegated to me by the Administrator, Applicability reduced controllability of the airplane. the FAA proposes to amend 14 CFR part (c) This AD applies to the following Compliance 39 as follows: Gulfstream Aerospace Corporation airplanes, (e) You are responsible for having the certificated in any category: PART 39—AIRWORTHINESS actions required by this AD performed within DIRECTIVES the compliance times specified, unless the TABLE 1.—APPLICABILITY actions have already been done. 1. The authority citation for part 39 continues to read as follows: Model Serial Nos. Repair (f) Within 12 months after the effective Authority: 49 U.S.C. 106(g), 40113, 44701. GV series airplanes .. 674 through 693 in- date of this AD, repair the force link clusive. § 39.13 [Amended] GV–SP series air- 5001 through 5072 assembly wire harness by doing all actions 2. The Federal Aviation planes. inclusive. specified in the Accomplishment Administration (FAA) amends § 39.13 Instructions of the applicable service by adding the following new Unsafe Condition information identified in Table 2 of this AD, except as required by paragraph (g) of this airworthiness directive (AD): (d) This AD results from a report indicating AD. Gulfstream Aerospace Corporation: Docket that the wiring harness outer shield and No. FAA–2006–24951; Directorate insulation on the primary conductors may Identifier 2005–NM–184–AD. have been inadvertently cut due to an

TABLE 2.—SERVICE INFORMATION

For model— Use—

GV–SP series airplanes ...... Gulfstream G500 Customer Bulletin 14, dated June 23, 2005. GV–SP series airplanes ...... Gulfstream G550 Customer Bulletin 14, dated June 23, 2005. GV series airplanes ...... Gulfstream GV Customer Bulletin 135, dated June 23, 2005.

Note 1: The Gulfstream customer bulletins Issued in Renton, Washington, on May 26, supports, and sleeving located in the identified in Table 2 of this AD include 2006. forward and aft lower lobe cargo Vought Service Bulletin SB-VAIGV/GVSP– Jeffrey E. Duven, compartments and corrective actions as 27–PG0098, dated May 9, 2005, as an Acting Manager, Transport Airplane necessary. This proposed AD results additional source of service information for Directorate, Aircraft Certification Service. from a fire in the forward lower lobe the repair. [FR Doc. E6–8711 Filed 6–5–06; 8:45 am] cargo compartment found shortly after BILLING CODE 4910–13–P airplane arrival. We are proposing this Exception to Service Bulletin Specifications AD to detect and correct damage to (g) During the inspection of the wires in the forward and aft lower lobe environmental seal around the installed DEPARTMENT OF TRANSPORTATION cargo compartments, which could result wires required by paragraph (f) of this AD: If in a potential short circuit and any nick or other damage is found, repair Federal Aviation Administration consequent fire in the forward and aft before further flight using a method approved lower lobe cargo compartments. by the Manager, Atlanta Aircraft Certification 14 CFR Part 39 DATES: We must receive comments on Office (ACO), FAA. For a repair method to this proposed AD by July 21, 2006. be approved by the Manager, Atlanta ACO, [Docket No. FAA–2006–24952; Directorate as required by this paragraph, the Manager’s Identifier 2006–NM–107–AD] ADDRESSES: Use one of the following addresses to submit comments on this approval letter must specifically refer to this RIN 2120–AA64 AD. proposed AD. • DOT Docket Web site: Go to Alternative Methods of Compliance Airworthiness Directives; Boeing Model 767 Airplanes http://dms.dot.gov and follow the (AMOCs) instructions for sending your comments (h)(1) The Manager, Atlanta ACO, FAA, AGENCY: Federal Aviation electronically. has the authority to approve AMOCs for this Administration (FAA), Department of • Government-wide rulemaking Web AD, if requested in accordance with the Transportation (DOT). site: Go to http://www.regulations.gov procedures found in 14 CFR 39.19. ACTION: Notice of proposed rulemaking and follow the instructions for sending (2) Before using any AMOC approved in (NPRM). your comments electronically. accordance with § 39.19 on any airplane to • Mail: Docket Management Facility, which the AMOC applies, notify the SUMMARY: The FAA proposes to adopt a U.S. Department of Transportation, 400 appropriate principal inspector in the FAA new airworthiness directive (AD) for all Seventh Street, SW., Nassif Building, Flight Standards Certificate Holding District Boeing Model 767 airplanes. This Room PL–401, Washington, DC 20590. Office. proposed AD would require repetitive • Fax: (202) 493–2251. detailed inspections of the wire • Hand Delivery: Room PL–401 on bundles, power display unit (PDU) the plaza level of the Nassif Building, wiring, and wire attaching hardware, 400 Seventh Street, SW., Washington,

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DC, between 9 a.m. and 5 p.m., Monday Discussion This proposed AD would affect about through Friday, except Federal holidays. We have received a report of a fire in 374 airplanes of U.S. registry. The Contact Boeing Commercial the forward lower lobe cargo proposed inspections would take about Airplanes, P.O. Box 3707, Seattle, compartment of a Boeing Model 767– 6 work hours per airplane, at an average Washington 98124–2207, for the service 300 series airplane, found 20 minutes labor rate of $80 per work hour. Based information identified in this proposed after arrival. The flightcrew and on these figures, the estimated cost of AD. passengers had deplaned before the start the proposed AD for U.S. operators is of the fire, and the cleaning crew and all $179,520, or $480 per airplane, per FOR FURTHER INFORMATION CONTACT: other personnel were evacuated without inspection cycle. Elias Natsiopoulos, Aerospace Engineer, incident. Investigation revealed that Authority for This Rulemaking Systems and Equipment Branch, ANM– flammable debris had accumulated 130S, FAA, Seattle Aircraft Certification below the 13L and 14L power drive Title 49 of the United States Code Office, 1601 Lind Avenue, SW., Renton, units (PDUs), but the source of ignition specifies the FAA’s authority to issue Washington 98055–4056; telephone was not positively identified. During rules on aviation safety. Subtitle I, (425) 917–6478; fax (425) 917–6590. subsequent inspections of the operator’s Section 106, describes the authority of SUPPLEMENTARY INFORMATION: fleet of Model 767 airplanes, crushed the FAA Administrator. Subtitle VII, and chafed PDU power supply cables Aviation Programs, describes in more Comments Invited were found. This condition, if not detail the scope of the Agency’s corrected, could result in a potential authority. We invite you to submit any relevant short circuit and consequent fire in the We are issuing this rulemaking under written data, views, or arguments forward and aft lower lobe cargo the authority described in Subtitle VII, regarding this proposed AD. Send your compartments. Part A, Subpart III, Section 44701, comments to an address listed in the ‘‘General requirements.’’ Under that ADDRESSES section. Include the docket Relevant Service Information section, Congress charges the FAA with number ‘‘FAA–2006–24952; Directorate We have reviewed Boeing Service promoting safe flight of civil aircraft in Identifier 2006–NM–107–AD’’ at the Bulletin 767–25–0376 (for Model 767– air commerce by prescribing regulations beginning of your comments. We 200, –300, and –300F series airplanes) for practices, methods, and procedures specifically invite comments on the and Boeing Service Bulletin 767–25– the Administrator finds necessary for overall regulatory, economic, 0377 (for Model 767–400ER series safety in air commerce. This regulation environmental, and energy aspects of airplanes), both dated November 17, is within the scope of that authority the proposed AD. We will consider all 2005. The service bulletins describe because it addresses an unsafe condition comments received by the closing date procedures for doing repetitive detailed that is likely to exist or develop on and may amend the proposed AD in inspections for damage to the wire products identified in this rulemaking light of those comments. bundles, PDU wiring, and wire action. We will post all comments we attaching hardware, supports, and receive, without change, to http:// sleeving located in the forward and aft Regulatory Findings dms.dot.gov, including any personal lower lobe cargo compartments; and We have determined that this information you provide. We will also doing corrective actions as necessary. proposed AD would not have federalism post a report summarizing each The corrective actions include repairing implications under Executive Order substantive verbal contact with FAA any damage to the wire bundles, PDU 13132. This proposed AD would not personnel concerning this proposed AD. wiring, and wire attaching hardware, have a substantial direct effect on the Using the search function of that web supports, and sleeving. Accomplishing States, on the relationship between the site, anyone can find and read the the actions specified in the service national Government and the States, or comments in any of our dockets, information is intended to adequately on the distribution of power and including the name of the individual address the unsafe condition. responsibilities among the various who sent the comment (or signed the FAA’s Determination and Requirements levels of government. comment on behalf of an association, of the Proposed AD For the reasons discussed above, I business, labor union, etc.). You may certify that the proposed regulation: We have evaluated all pertinent review DOT’s complete Privacy Act 1. Is not a ‘‘significant regulatory information and identified an unsafe Statement in the Federal Register action’’ under Executive Order 12866; condition that is likely to exist or published on April 11, 2000 (65 FR 2. Is not a ‘‘significant rule’’ under the develop on other airplanes of this same 19477–78), or you may visit http:// DOT Regulatory Policies and Procedures type design. For this reason, we are dms.dot.gov. (44 FR 11034, February 26, 1979); and proposing this AD, which would require Examining the Docket accomplishing the actions specified in 3. Will not have a significant the service information described economic impact, positive or negative, You may examine the AD docket on previously. on a substantial number of small entities the Internet at http://dms.dot.gov, or in under the criteria of the Regulatory person at the Docket Management Clarification of Inspection Terminology Flexibility Act. Facility office between 9 a.m. and 5 The ‘‘detailed visual inspection’’ We prepared a regulatory evaluation p.m., Monday through Friday, except specified in the service bulletins is of the estimated costs to comply with Federal holidays. The Docket referred to as a ‘‘detailed inspection’’ in this proposed AD and placed it in the Management Facility office (telephone this proposed AD. Boeing has included AD docket. See the ADDRESSES section (800) 647–5227) is located on the plaza the definition for a detailed inspection for a location to examine the regulatory level of the Nassif Building at the DOT in Note 4 of the service bulletins. evaluation. street address stated in the ADDRESSES section. Comments will be available in Costs of Compliance List of Subjects in 14 CFR Part 39 the AD docket shortly after the Docket There are about 857 airplanes of the Air transportation, Aircraft, Aviation Management System receives them. affected design in the worldwide fleet. safety, Safety.

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The Proposed Amendment authority to approve AMOCs for this AD, if flight data recorders (FDR) of a certain requested in accordance with the procedures model. That action resulted from reports Accordingly, under the authority found in 14 CFR 39.19. delegated to me by the Administrator, of a number of incidents in which flight (2) Before using any AMOC approved in data have been lost from the FDR. the FAA proposes to amend 14 CFR part accordance with § 39.19 on any airplane to 39 as follows: which the AMOC applies, notify the The proposed actions were intended appropriate principal inspector in the FAA to prevent loss of flight data from the PART 39—AIRWORTHINESS Flight Standards Certificate Holding District FDR, which could hamper discovery of DIRECTIVES Office. the cause of an accident, preventing the Federal Aviation Administration from 1. The authority citation for part 39 Issued in Renton, Washington, on May 26, developing and mandating actions to continues to read as follows: 2006. Jeffrey E. Duven, prevent additional accidents caused by Authority: 49 U.S.C. 106(g), 40113, 44701. Acting Manager, Transport Airplane the same unsafe condition. § 39.13 [Amended] Directorate, Aircraft Certification Service. Actions That Occurred Since the NPRM 2. The Federal Aviation [FR Doc. E6–8708 Filed 6–5–06; 8:45 am] Was Issued Administration (FAA) amends § 39.13 BILLING CODE 4910–13–P Since the issuance of that NPRM, the by adding the following new FDR manufacturer, L–3 airworthiness directive (AD): DEPARTMENT OF TRANSPORTATION Communications Corporation, notified Boeing: Docket No. FAA–2006–24952; the FAA that the only affected operator Directorate Identifier 2006–NM–107–AD. Federal Aviation Administration flying in the U.S. has accomplished the Comments Due Date action proposed in the NPRM, and no (a) The FAA must receive comments on 14 CFR Part 39 unsafe condition exists or is likely to this AD action by July 21, 2006. exist. In the event that a Saab Model [Docket No. 2001–NM–110–AD] SAAB-Fairchild SF340A (SAAB/ Affected ADs RIN 2120–AA64 SF340A), or SAAB 340B airplane is (b) None. imported into the U.S., the FAA issued Applicability Airworthiness Directives; Saab Model a Special Airworthiness Information (c) This AD applies to all Model 767–200, SAAB SF340A and SAAB 340B Series Bulletin (NM–06–40, April 14, 2006) to –300, –300F, and –400ER series airplanes, Airplanes alert U.S. operators of the need to install certificated in any category. the replacement FDR. AGENCY: Federal Aviation Unsafe Condition Administration, DOT. Explanation of Change to Model (d) This AD results from a fire in the ACTION: Proposed rule; withdrawal. Designation forward lower lobe cargo compartment found We have revised the model reference shortly after airplane arrival. We are issuing SUMMARY: This action withdraws a in the above paragraph to identify this AD to detect and correct damage to wires notice of proposed rulemaking (NPRM) model designations as published in the in the forward and aft lower lobe cargo that proposed a new airworthiness most recent type certificate data sheet compartments, which could result in a directive (AD), applicable to all Saab for the affected models. potential short circuit and consequent fire in Model SAAB SF340A and SAAB 340B the forward and aft lower lobe cargo compartments. series airplanes. That action would have FAA’s Conclusions required modifying or replacing flight Upon further consideration, the FAA Compliance data recorders (FDR) of a certain model. has determined that the actions that (e) You are responsible for having the Since the issuance of the NPRM, the would have been required by the NPRM actions required by this AD performed within Federal Aviation Administration (FAA) have already been done on all affected the compliance times specified, unless the has received new data that the airplanes, and the identified unsafe actions have already been done. identified unsafe condition has been condition has been corrected. Repetitive Inspections and Corrective corrected on all airplanes that would Accordingly, the proposed rule is Actions if Applicable have been subject to the NPRM. hereby withdrawn. (f) Within 36 months after the effective Accordingly, the proposed rule is date of this AD, do detailed inspections for withdrawn. Withdrawal of this NPRM constitutes damage to the wire bundles, power drive unit only such action, and does not preclude wiring, and wire attaching hardware, FOR FURTHER INFORMATION CONTACT: Dan the agency from issuing another action supports, and sleeving located in the forward Rodina, Aerospace Engineer, in the future, nor does it commit the and aft lower lobe cargo compartments; and International Branch, ANM–116, agency to any course of action in the do all applicable corrective actions before Transport Airplane Directorate, FAA, future. further flight after the inspections; by 1601 Lind Avenue, SW., Renton, accomplishing all of the actions specified in Washington 98055–4056; telephone Regulatory Impact the Accomplishment Instructions of Boeing (425) 227–2125; fax (425) 227–1149. Service Bulletin 767–25–0376 (for Model Since this action only withdraws a 767–200, –300, and –300F series airplanes) or SUPPLEMENTARY INFORMATION: A notice of proposed rulemaking, it is Boeing Service Bulletin 767–25–0377 (for proposal to amend part 39 of the Federal neither a proposed nor a final rule and Model 767–400ER series airplanes), both Aviation Regulations (14 CFR part 39) to therefore is not covered under Executive dated November 17, 2005, as applicable. add a new airworthiness directive (AD), Order 12866, the Regulatory Flexibility Repeat the inspections thereafter at intervals applicable to all Saab Model SAAB Act, or DOT Regulatory Policies and not to exceed 24,000 flight hours or 72 SF340A and SAAB 340B series Procedures (44 FR 11034, February 26, months, whichever occurs first. airplanes, was published in the Federal 1979). Alternative Methods of Compliance Register as a Notice of Proposed List of Subjects in 14 CFR Part 39 (AMOCs) Rulemaking (NPRM) on August 17, 2001 (g)(1) The Manager, Seattle Aircraft (66 FR 43128). The proposed rule would Air transportation, Aircraft, Aviation Certification Office (ACO), FAA, has the have required modifying or replacing safety, Safety.

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The Withdrawal Seventh Street, SW., Washington, DC, the proposed AD. We are also inviting Accordingly, the notice of proposed between 9 a.m. and 5 p.m., Monday comments, views, or arguments on the rulemaking, Docket 2001–NM–110–AD, through Friday, except Federal holidays. new MCAI process. We will consider all published in the Federal Register on For service information identified in comments received by the closing date August 17, 2001 (66 FR 43128), is the proposed AD, contact the B–N and may amend the proposed AD in withdrawn. Group Ltd, Bembridge Airport, Isle of light of those comments. Wright, United Kingdom, PO35 5PR; Issued in Renton, Washington, on May 26, We will post all comments we telephone: 0870 881 5064; facsimile: receive, without change, to http:// 2006. 0870 881 5065; e-mail: Ali Bahrami, dms.dot.gov, including any personal [email protected]. information you provide. We will also Manager, Transport Airplane Directorate, FOR FURTHER INFORMATION CONTACT: Aircraft Certification Service. post a report summarizing each Taylor Martin, Aerospace Safety substantive verbal contact we receive [FR Doc. E6–8710 Filed 6–5–06; 8:45 am] Engineer, FAA, Small Airplane concerning this proposed AD. BILLING CODE 4910–13–P Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: Discussion (816) 329–4138; facsimile: (816) 329– DEPARTMENT OF TRANSPORTATION The Civil Aviation Authority (CAA), 4090. which is the airworthiness authority for Federal Aviation Administration SUPPLEMENTARY INFORMATION: the United Kingdom, has issued British Streamlined Issuance of AD Airworthiness Directive No. G–2004– 14 CFR Part 39 0011, dated May 25, 2004 (referred to The FAA is implementing a new after this as ‘‘the MCAI’’), to correct an [Docket No. FAA–2005–22420; Directorate process for streamlining the issuance of Identifier 2005–CE–47–AD] unsafe condition for the specified ADs related to MCAI. We are products. The MCAI states that that the RIN 2120–AA64 prototyping this process and specifically aircraft manufacturer has identified request your comments on its use. This several cases of corroded elevator final Airworthiness Directives; B–N Group streamlined process will allow us to drive control rods. If not corrected Ltd. BN–2, BN–2A, BN–2B, BN–2T, and adopt MCAI safety requirements in a corrosion of the interior surface could BN–2T–4R Series (All Individual more efficient manner and will reduce result in failure or collapse of the rod, Models Included in Type Certificate safety risks to the public. resulting in loss of control or jamming Data Sheet (TCDS) A17EU, Revision This process continues to follow all of the elevator system. The MCAI 16, Dated December 9, 2002) Airplanes existing AD issuance processes to meet requires an inspection of the internal legal, economic, Administrative AGENCY: Federal Aviation surface of the elevator system final drive Procedure Act, and Federal Register Administration (FAA), Department of control rod and replacement if found requirements. We also continue to Transportation (DOT). corroded. You may obtain further follow our technical decision-making information by examining the MCAI in ACTION: Notice of proposed rulemaking processes in all aspects to meet our the docket. (NPRM). responsibilities to determine and correct unsafe conditions on U.S.-certificated Relevant Service Information SUMMARY: We propose to adopt a new airworthiness directive (AD) for the products. This proposed AD references the BN-Group Ltd. has issued Britten- products listed above. This proposed MCAI and related service information Norman Service Bulletin SB number AD results from mandatory continuing that we considered in forming the 303, Issue 1, dated May 14, 2004. The airworthiness information (MCAI) engineering basis to correct the unsafe actions described in this service issued by an airworthiness authority of condition. The proposed AD contains information are intended to correct the another country. The proposed AD text copied from the MCAI and for this unsafe condition identified in the would require actions that are intended reason might not follow our plain MCAI. to address an unsafe condition language principles. described in the MCAI. FAA’s Determination and Requirements The comment period for this of the Proposed AD DATES: We must receive comments on proposed AD is open for 15 days. The this proposed AD by June 21, 2006. comment period is reduced because the This product is manufactured outside ADDRESSES: Use one of the following airworthiness authority and the United States and is type certificated addresses to comment on this proposed manufacturer have already published for operation in the United States under AD: the documents on which we based our the provisions of section 21.29 of the • DOT Docket Web site: Go to decision, making a longer comment Federal Aviation Regulations (14 CFR http://dms.dot.gov and follow the period unnecessary. 21.29) and the applicable bilateral instructions for sending your comments agreement. Pursuant to this bilateral electronically. Comments Invited airworthiness agreement, the State of • Government-wide rulemaking Web We invite you to send any written Design’s airworthiness authority has site: Go to http://www.regulations.gov data, views, or arguments regarding this notified us of the unsafe condition and follow the instructions for sending proposed AD. Send your comments to described in the MCAI and service your comments electronically. an address listed under the ADDRESSES information referenced above. We have • Mail: Docket Management Facility; section. Include the docket number, examined the airworthiness authority’s U.S. Department of Transportation, 400 Docket No. FAA–2005–22420; findings, evaluated all pertinent Seventh Street, SW., Nassif Building, Directorate Identifier 2005–CE–47–AD information, and determined an unsafe Room PL–401, Washington, DC 20590. at the beginning of your comments. We condition exists and is likely to exist or • Fax: (202) 493–2251. specifically invite comments on the develop on all products of this type • Hand delivery: Room PL–401 on the overall regulatory, economic, design. We are issuing this proposed AD plaza level of the Nassif Building, 400 environmental, and energy aspects of to correct the unsafe condition.

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Differences Between the Proposed AD Regulatory Findings Comments Due Date and the MCAI or Service Information We have determined that this (a) We must receive comments on this proposed airworthiness directive (AD) by We have reviewed the MCAI and proposed AD would not have federalism June 21, 2006. related service information and, in implications under Executive Order general, agree with their substance. But 13132. This proposed AD would not Affected ADs we might have found it necessary to use have a substantial direct effect on the (b) None. different words from those in the MCAI States, on the relationship between the Applicability national Government and the States, or to ensure the AD is clear for U.S. (c) This AD applies to all BN–2, BN–2A, operators and is enforceable in a U.S. on the distribution of power and BN–2B, BN–2T, and BN–2T–4R Series (all court of law. In making these changes, responsibilities among the various individual models included in Type we do not intend to differ substantively levels of government. Certificate Data Sheet (TCDS) A17EU, from the information provided in the For the reasons discussed above, I Revision 16, dated December 9, 2002) MCAI and related service information. certify that the proposed regulation: airplanes; certificated in any U.S. category. We might also have proposed 1. Is not a ‘‘significant regulatory Reason different actions in this AD from those action’’ under Executive Order 12866; (d) The aircraft manufacturer has identified in the MCAI in order to follow FAA 2. Is not a ‘‘significant rule’’ under the several cases of corroded elevator final drive policies. Any such differences are DOT Regulatory Policies and Procedures control rods. If not corrected corrosion of the described in a separate paragraph of the (44 FR 11034, February 26, 1979); and interior surface could result in failure or proposed AD. These proposed collapse of the rod, resulting in loss of 3. Will not have a significant control or jamming of the elevator system. requirements, if ultimately adopted, will economic impact, positive or negative, take precedence over the actions copied The mandatory continuing airworthiness on a substantial number of small entities information (MCAI) requires an inspection of from the MCAI. under the criteria of the Regulatory the internal surface of the elevator system Costs of Compliance Flexibility Act. final drive control rod and replacement if We prepared a regulatory evaluation found corroded. Based on the service information, we of the estimated costs to comply with Actions and Compliance estimate that this proposed AD would this proposed AD and placed it in the affect about 91 products of U.S. registry. (e) Unless already done, do the following AD docket. except as stated in paragraph (f) below. We also estimate that it would take Examining the AD Docket (1) Within the next 50 hours time-in- about 5 workhours per product to do the service or one month after the effective date action and that the average labor rate is You may examine the AD docket that of this AD, whichever occurs first, inspect $80 per workhour. Required parts contains the proposed AD, the the internal surface of the elevator system would cost about $1,000 per product. regulatory evaluation, any comments final drive control rod, in accordance with B- Where the service information lists N Group Ltd. Britten-Norman Service received, and other information on the Bulletin SB number 303, Issue 1, dated May required parts costs that are covered Internet at http://dms.dot.gov; or in under warranty, we have assumed that 14, 2004. person at the Docket Management (2) If corrosion is found, the elevator there will be no charge for these costs. Facility between 9 a.m. and 5 p.m., control rod must be replaced before further As we do not control warranty coverage Monday through Friday, except Federal flight. for affected parties, some parties may holidays. The Docket Office (telephone FAA AD Differences incur costs higher than estimated here. (800) 647–5227) is located at the street (f) When complying with this AD, repeat Based on these figures, we estimate the address stated in the ADDRESSES section. cost of the proposed AD on U.S. the actions in paragraphs (e)(1) and (e)(2) of Comments will be available in the AD this AD at intervals not to exceed 12 months. operators to be $127,400, or $1,400 per docket shortly after receipt. product. Other FAA AD Provisions List of Subjects in 14 CFR Part 39 Authority for This Rulemaking (g) The following provisions also apply to Air transportation, Aircraft, Aviation this AD: Title 49 of the United States Code safety, Safety. (1) Alternative Methods of Compliance specifies FAA’s authority to issue rules (AMOCs): The Manager, Standards Staff, on aviation safety. Subtitle I, Section The Proposed Amendment FAA, ATTN: Taylor Martin, Aerospace Safety 106, describes the authority of the FAA Engineer, FAA, Small Airplane Directorate, Accordingly, under the authority 901 Locust, Room 301, Kansas City, Missouri Administrator. Subtitle VII, Aviation delegated to me by the Administrator, 64106; telephone: (816) 329–4138; fax: (816) Programs, describes in more detail the the Federal Aviation Administration 329–4090, has the authority to approve scope of the Agency’s authority. proposes to amend 14 CFR part 39 as AMOCs for this AD, if requested using the We are issuing this rulemaking under follows: procedures found in 14 CFR 39.19. the authority described in Subtitle VII, (2) Return to Airworthiness: When Part A, Subpart III, Section 44701, PART 39—AIRWORTHINESS complying with this AD, perform FAA- DIRECTIVES approved corrective actions before returning ‘‘General requirements.’’ Under that the product to an airworthy condition. section, Congress charges FAA with 1. The authority citation for part 39 (3) Reporting Requirements: For any promoting safe flight of civil aircraft in reporting requirement in this AD, under the air commerce by prescribing regulations continues to read as follows: provisions of the Paperwork Reduction Act, for practices, methods, and procedures Authority: 49 U.S.C. 106(g), 40113, 44701. the Office of Management and Budget (OMB) the Administrator finds necessary for has approved the information collection safety in air commerce. This regulation § 39.13 [Amended] requirements and has assigned OMB Control is within the scope of that authority 2. The FAA amends § 39.13 by adding Number 2120–0056. because it addresses an unsafe condition the following new AD: Related Information that is likely to exist or develop on B–N Group Ltd: Docket No. FAA–2005– (h) This AD is related to MCAI United products identified in this rulemaking 22420; Directorate Identifier 2005–CE– Kingdom Airworthiness Directive No: G– action. 47–AD. 2004–0011, Issued Date: May 25, 2004, which

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references B-N Group Ltd. Britten-Norman number, 1–800–772–1213 or TTY 1– revise § 402.45 by adding a new Service Bulletin SB number 303, Issue 1, 800–325–0778, or visit our Internet subsection (e). New subsection dated May 14, 2004, for information on Website, Social Security Online, at § 402.45(e) will fully describe the rules required actions. http://www.socialsecurity.gov. governing the release of personally Issued in Kansas City, Missouri, on May SUPPLEMENTARY INFORMATION: identifiable information as it pertains to 30, 2006. employees’ telephone numbers and duty David R. Showers, Electronic Version stations (including room numbers, bay Acting Manager, Small Airplane Directorate, The electronic file of this document is designations, or other identifying Aircraft Certification Service. available on the date of publication in information regarding buildings or [FR Doc. E6–8713 Filed 6–5–06; 8:45 am] the Federal Register at http:// places of employment). www.gpoaccess.gov/fr/index.html. BILLING CODE 4910–13–P Clarity of These Proposed Rules Background Executive Order 12866, as amended Former Commissioner Kenneth S. SOCIAL SECURITY ADMINISTRATION by Executive Order 13258, requires each Apfel approved a recommendation of agency to write all rules in plain 20 CFR Parts 401 and 402 the National Health and Safety language. In addition to your Partnership Committee for Security substantive comments on these RIN 0960–AG14 (NHSPCS) to implement a nationwide proposed rules, we invite your program to enhance the safety and comments on how to make these Privacy and Disclosure of Official security of SSA employees who are Records and Information proposed rules easier to understand. For victims, or potential victims, of example: AGENCY: Social Security Administration. domestic violence. The NHSPCS’ • Have we organized the material to ACTION: Notice of Proposed Rulemaking. proposed program was developed, suit your needs? during the era of ‘‘partnership’’, by a • Are the requirements in the rules SUMMARY: We propose to amend our joint union/management workgroup. It clearly stated? privacy and disclosure rules to help was intended to safeguard the • Do the rules contain technical preserve the anonymity of, and help anonymity of at-risk employees when language or jargon that is not clear? protect the physical well-being of, SSA requests for their work location and/or • Would a different format (grouping employees who reasonably believe that phone number were received, by and order of sections, use of headings, they are at risk of injury or other harm delaying the disclosure of the paragraphing) make the rules easier to information when certain conditions if certain employment information understand? were met. This would have entailed a about them is disclosed. These changes • Would more (but shorter) sections change in SSA policy that now permits in the regulations would ensure uniform be better? such information requests to be application of the policy for at-risk • Could we improve clarity by adding honored. No action was ever taken on employees. tables, lists, or diagrams? the recommendation when the DATES: To be sure that your comments • What else could we do to make the ‘‘partnership’’ was dissolved by are considered, we must receive them rules easier to understand? no later than August 7, 2006. Executive Order 13203 on February 17, 2001. We are now proposing a modified Regulatory Procedures ADDRESSES: You may give us your approach to strengthening our privacy Executive Order 12866 comments by: using our Internet facility and disclosure rules to better safeguard (i.e., Social Security Online) at http:// at-risk employees. We have consulted with the Office of policy.ssa.gov/erm/rules.nsf/ Management and Budget (OMB) and Rules+Open+To+Comment or the Explanation of Changes determined that these proposed rules Federal eRulemaking Portal at http:// We propose to amend subsection would meet the criteria for a significant www.regulations.gov; e-mail to (b)(3)(c)(4) of Appendix A to Part 401 regulatory action under Executive Order [email protected]; by telefax to (410) and add a new subsection (e) to § 402.45 12866, as amended by Executive Order 966–2830, or letter to the Commissioner to permit SSA to exercise its discretion, 13258. Thus, they were subject to OMB of Social Security, P.O. Box 17703, consistent with the Freedom of review. Baltimore, MD 21235–7703. You may Information Act and the rules of the also deliver them to the Office of Office of Personnel Management (5 CFR Regulatory Flexibility Act Regulations, Social Security part 293), to withhold the work location We certify that these proposed rules Administration, 100 Altmeyer Building, and telephone number of employees would not have a significant economic 6401 Security Boulevard, Baltimore, who reasonably believe that they are at impact on a substantial number of small MD. 21235–6401, between 8 a.m. and risk of injury or other harm by the entities because they affect only 4:30 p.m. on regular business days. disclosure of such information. These individuals or entities acting on their Comments are posted on our Internet proposed changes would clarify our behalf. Thus, a regulatory flexibility site, or you may inspect them on regular procedures for access to, and disclosure analysis as provided in the Regulatory business days by making arrangements of, personally identifiable information Flexibility Act, as amended, is not with the contact person shown in this regarding employees and enhance our required. preamble. ability to maintain adequate safeguards Paperwork Reduction Act FOR FURTHER INFORMATION CONTACT: Edie against disclosures in situations in McCracken, Social Insurance Specialist, which an employee may be at risk or These proposed rules impose no Office of Public Disclosure, 3–A–6 fear for his/her physical safety. reporting or record keeping Operations Building, 6401 Security We propose to amend Part 401, requirements subject to OMB clearance. Boulevard, Baltimore, MD 21235–6401, Appendix A, (b)(3)(c)(4) by removing (Catalog of Federal Domestic Assistance (410) 965–6117 or TTY (410) 965–5609. the first sentence, ‘‘Location of duty Program Nos. 96.001, Social Security- For information on eligibility or filing station, including room number and Disability Insurance; 96.002, Social Security- for benefits, call our national toll-free telephone number.’’ We also propose to Retirement Insurance; 96.004, Social

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Security-Survivors Insurance; 96.006, (2) Would otherwise be protected comments and the public hearing, Supplemental Security Income). from mandatory disclosure under an Treena Garrett, (202) 622–7180 (not toll- List of Subjects in 20 CFR Parts 401 and exemption of the FOIA. free numbers). 402 [FR Doc. E6–8697 Filed 6–5–06; 8:45 am] SUPPLEMENTARY INFORMATION: Administrative practice and BILLING CODE 4191–02–P Background and Explanation of procedure, Freedom of information, Provisions Privacy. Temporary regulations in the Rules DEPARTMENT OF THE TREASURY Dated: February 27, 2006. and Regulations section of this issue of the Federal Register amend the Income Jo Anne B. Barnhart, Internal Revenue Service Tax Regulations (26 CFR part 1) relating Commissioner of Social Security. to section 7874. The temporary 26 CFR Part 1 For the reasons set out in the regulations set forth rules relating to the preamble, we propose to amend subpart [REG–112994–06] determination of whether a foreign C of part 401 and part 402 of chapter III RIN 1545–BF47 entity shall be treated as a surrogate of title 20 of the Code of Federal foreign corporation under section Regulations as set forth below: Guidance Under Section 7874 7874(a)(2)(B) of the Code. The text of Regarding Expatriated Entities and those regulations also serves as the text PART 401—PRIVACY AND Their Foreign Parents of these proposed regulations. The DISCLOSURE OF OFFICIAL RECORDS preamble to the temporary regulations AND INFORMATION AGENCY: Internal Revenue Service (IRS), explains the amendments. Treasury. Special Analyses 1. The authority citation for part 401 ACTION: Notice of proposed rulemaking continues to read as follows: by cross-reference to temporary It has been determined that this notice Authority: Secs. 205, 702(a)(5), 1106, and regulation and notice of public hearing. of proposed rulemaking is not a 1141 of the Social Security Act (42 U.S.C. significant regulatory action as defined 405, 902(a)(5), 1306, and 1320b–11); 5 U.S.C. SUMMARY: In the Rules and Regulations in Executive Order 12866. Therefore, a 552 and 552a; 8 U.S.C. 1360; 26 U.S.C. 6103; section of this issue of the Federal regulatory assessment is not required. 30 U.S.C. 923. Register, the IRS is issuing temporary Pursuant to the Regulatory Flexibility regulations relating to the determination Act (5 U.S.C. chapter 6), it is hereby Appendix A to Part 401—[Amended] of whether a foreign entity shall be certified that this regulation will not treated as a surrogate foreign have a significant economic impact on 2. Appendix A, paragraph (b)(3)(c)(4) corporation under section 7874(a)(2)(B) a substantial number of small entities. is amended by removing the first of the Code. The text of those Accordingly, a regulatory flexibility sentence. regulations also serves as the text of analysis is not required. The nature of PART 402—AVAILABILITY OF these proposed regulations. This the businesses that are most likely to INFORMATION AND RECORDS TO document also provides notice of a consider corporate expatriation THE PUBLIC public hearing on these proposed transactions, as well as the complexity regulations. and the costs of structuring and implementing those transactions, makes 1. The authority citation for part 402 DATES: Written or electronic comments it unlikely that a substantial number of continues to read as follows: must be received by September 5, 2006. small entities will engage in such Outlines of topics to be discussed at the Authority: Secs. 205, 702(a)(5), and 1106 of transactions. In addition, any economic the Social Security Act; (42 U.S.C. 405, public hearing scheduled for October impact to entities affected by section 902(a)(5), and 1306); 5 U.S.C. 552 and 552a; 24, 2006, at 10 a.m., must be received 7874, large or small, is derived from the 8 U.S.C. 1360; 18 U.S.C. 1905; 26 U.S.C. by October 3, 2006. 6103; 30 U.S.C. 923b; 31 U.S.C. 9701; E.O. operation of the statute or its intended ADDRESSES: Send submissions to: 12600, 52 FR 23781, 3 CFR, 1987 Comp., p. application, not the proposed 235. CC:PA:LPD:PR (REG–112994–06), room regulations in this notice of proposed 5203, Internal Revenue Service, PO Box rulemaking. Pursuant to section 7805(f) 2. Section 402.45 is amended by 7604, Ben Franklin Station, Washington, of the Code, this notice of proposed adding paragraph (e) to read as follows: DC 20044. Submissions may be hand- rulemaking will be submitted to the delivered Monday through Friday § 402.45 Availability of records. Chief Counsel for Advocacy of the Small between the hours of 8 a.m. and 4 p.m. * * * * * Business Administration for comment to: CC:PA:LPD:PR (REG–112994–06), on its impact on small business. (e) Federal employees. The agency Courier’s Desk, Internal Revenue will generally not disclose information Service, 1111 Constitution Avenue, Comments and Public Hearing when the data sought is a list of NW., Washington, DC, or sent Before these proposed regulations are telephone numbers and/or duty stations electronically, via the IRS Internet site adopted as final regulations, of one or more Federal employees at: http://www.irs.gov/regs or via the consideration will be given to any which, as determined by the official Federal eRulemaking Portal at http:// written comments (a signed original and responsible for custody of the www.regulations.gov (IRS–REG– eight (8) copies) or electronic comments information: 112994–06). The public hearing will be that are submitted timely to the IRS. The (1) Is selected in such a way that held in the auditorium, Internal IRS and Treasury Department would reveal more about the employee Revenue Building, 1111 Constitution specifically request comments on the on whom information is sought than the Avenue, NW., Washington, DC. clarity of the proposed regulations and aforementioned items, the disclosure of FOR FURTHER INFORMATION CONTACT: how they can be made easier to which would constitute a clearly Concerning the proposed regulations, understand. All comments will be unwarranted invasion of personal Milton Cahn at (202) 622–3860; available for public inspection and privacy; or concerning submission and delivery of copying.

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A public hearing has been scheduled published elsewhere in this issue of the (4) Sandy Dragoo, Executive Director, for October 24, 2006, at 10 a.m., in the Federal Register]. Capital Area Transportation Authority. auditorium, Internal Revenue Building, Mark E. Matthews, The Deputy Administrator considered 1111 Constitution Avenue, NW., these names, and, on May 26, 2006, Washington, DC. Due to building Deputy Commissioner for Services and Enforcement. approved the inclusion of these security procedures, visitors must enter individuals on the CBNRAC. at the Constitution Avenue entrance. In [FR Doc. E6–8698 Filed 6–5–06; 8:45 am] addition, all visitors must present photo BILLING CODE 4830–01–P Schedule of Meetings identification to enter the building. As mentioned above, the first Because of access restrictions, visitors meetings of the CBNRAC occurred on will not be admitted beyond the DEPARTMENT OF TRANSPORTATION May 8 and 9 in Washington, DC. During immediate entrance area more than 30 those meetings, the Committee agreed minutes before the hearing starts. For Federal Transit Administration on the following schedule for future information about having your name meetings: 49 CFR Part 604 placed on the building access list to June 19 from 9 a.m. to 4:30 p.m. attend the hearing, see the FOR FURTHER [Docket No. FTA–2005–22657] June 20 from 8:30 a.m. to 4 p.m. INFORMATION CONTACT section of this July 17 from 9 a.m. to 4:30 p.m. preamble. RIN 2132–AA85 July 18 from 8:30 a.m. to 4 p.m. The rules of 26 CFR 601.601(a)(3) September 12 from 9 a.m. to 4:30 p.m. Charter Service apply to the hearing. Persons who wish September 13 from 8:30 a.m. to 4 p.m. October 25 from 9 a.m. to 4:30 p.m. to present oral comments at the hearing AGENCY: Federal Transit Administration must submit electronic or written (FTA), DOT. October 26 from 8:30 a.m. to 4 p.m. comments and an outline of the topics December 6 from 9 a.m. to 4:30 p.m. ACTION: Notice of additional committee December 7 from 8:30 a.m. to 4 p.m. to be discussed and the time to be members notice of and meeting dates All of the above meetings will be held devoted to each topic (a signed original and times. and eight (8) copies) by October 3, 2006. in room 2301 at 400 Seventh Street, A period of 10 minutes will be allotted SUMMARY: This notice lists the SW., Washington, DC. Any changes in to each person for making comments. additional committee members as dates, times, or location, will be An agenda showing the scheduling of nominated by the Charter Bus announced in a Federal Register notice the speakers will be prepared after the Negotiated Rulemaking Advisory in advance of the next meeting. deadline for receiving outlines has Committee (CBNRAC) and approved by Issued this 31st day of May, 2006, in passed. Copies of the agenda will be the Deputy Administrator of the Federal Washington, DC. available free of charge at the hearing. Transit Administration (FTA). This Sandra K. Bushue, notice also includes new meeting dates Drafting Information Deputy Administrator. and times. [FR Doc. 06–5133 Filed 6–5–06; 8:45 am] The principal author of these DATES: Effective Date: June 6, 2006. See BILLING CODE 4910–57–M regulations is Jefferson VanderWolk of SUPPLEMENTARY INFORMATION section for the Office of the Associate Chief dates of future meetings. Counsel (International). However, other FOR FURTHER INFORMATION CONTACT: DEPARTMENT OF THE INTERIOR personnel from the IRS and Treasury Elizabeth Martineau, Attorney-Advisor, Department participated in their Office of the Chief Counsel, Federal Fish and Wildlife Service development. Transit Administration, 202–366–1936 List of Subjects in 26 CFR Part 1 ([email protected]). Her 50 CFR Part 17 mailing address at the Federal Transit RIN 1018–AU33 Income taxes, Reporting and Administration is 400 Seventh Street, recordkeeping requirements. SW., Room 9316, Washington, DC Endangered and Threatened Wildlife Proposed Amendments to the 20590. and Plants; Proposed Designation of Regulations SUPPLEMENTARY INFORMATION: Critical Habitat for the Spikedace and Loach Minnow Accordingly, 26 CFR part 1 is New Members AGENCY: proposed to be amended as follows: Fish and Wildlife Service, April 10, 2006, FTA published a final Interior. notice establishing the Charter Bus PART 1—INCOME TAXES ACTION: Revised proposed rule; Negotiated Rulemaking Advisory reopening of public comment period, Committee (CBNRAC) (71 FR 18056). Paragraph 1. The authority citation notice of availability of draft economic The CBNRAC held its first meeting in for part 1 is amended by adding an entry analysis and draft environmental Washington, DC on May 8 and 9. During in numerical order to read, in part, as assessment, notice of public hearings, those meetings, the members of the follows: and updated legal descriptions for CBNRAC nominated four additional critical habitat units. Authority: 26 U.S.C. 7805 * * * members for inclusion on the CBNRAC. Section 1.7874–2 also issued under 26 Those individuals are: U.S.C. 7874(c)(6) and (g). * * * SUMMARY: We, the U.S. Fish and (1) Michael Waters, Vice President Wildlife Service (Service), announce the Par. 2. Section 1.7874–2 is added to and General Manager, Coach USA; availability of the draft economic read as follows: (2) Dale Moser, Chief Operating analysis and draft environmental Officer, Coach America; assessment for the proposal to designate § 1.7874–2 Surrogate foreign corporation. (3) Richard Ruddell, President and critical habitat for the spikedace (Meda [The text of proposed § 1.7874–2 is Executive Director, Fort Worth fulgida) and loach minnow (Tiaroga the same as the text of § 1.7874–2T Transportation Authority; cobitis) under the Endangered Species

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Act of 1973, as amended (Act). The draft or draft environmental assessment, you Act, or are not appropriate for economic analysis finds that costs may submit your comments and exclusion. We particularly seek associated with spikedace and materials identified by RIN 1018–AU33, comments concerning: loachminnow conservation activities are by any of the following methods: (1) The reasons any habitat should or forecast to range from $25.2 million to (1) E-mail: [email protected]. should not be determined to be critical $100.3 million in constant dollars over Include RIN 1018–AU33 in the subject habitat as provided by section 4 of the the next 20 years. Adjusted for possible line. Please submit electronic comments Endangered Species Act of 1973, as inflation the costs would range from in ASCII file format and avoid the use amended (Act) (16 U.S.C. 1531 et seq.), $19.0 million to $83.6 million over 20 of special characters or any form of including whether it is prudent to years, or $1.3 million to $5.7 million encryption. Please also include your designate critical habitat; annually, using a three percent name and return address in the body of (2) Specific information on the discount; or $13.9 million to $69.2 your message. If you do not receive a distribution of the spikedace and loach million over 20 years, or $1.4 million to confirmation from the system that we minnow, the amount and distribution of $6.7 million over 20 years annually, have received your Internet message, the species’ habitat, and which habitat using a seven percent discount rate. contact us directly by calling our contains the necessary features (primary We are also reopening the public Arizona Ecological Services Field Office constituent elements) essential to the comment period for the proposal to at (602) 242–0210. conservation of these species and why; designate critical habitat to allow all (2) Fax: (602) 242–2513. (3) Land-use designations and current interested parties an opportunity to (3) Mail or hand delivery/courier: or planned activities in the subject area comment on and request changes to the Steve Spangle, Field Supervisor, and their possible impacts on these proposed critical habitat designation, as Arizona Ecological Services Field species or proposed critical habitat; well as the associated draft economic Office, 2321 W. Royal Palm Road, Suite (4) Whether our approach to critical analysis and draft environmental 103, Phoenix, AZ 85021. habitat designation could be improved assessment. In addition, we are (4) Federal eRulemaking Portal: or modified in any way to provide for proposing corrected legal descriptions http://www.regulations.gov. Follow the greater public participation and for some of the critical habitat units. instructions for submitting comments. understanding, or to assist us in Comments previously submitted on the You may obtain copies of the accommodating public concerns and December 20, 2005, proposed rule need proposed rule, draft economic analysis, comments; not be resubmitted as they have been and draft environmental assessment by (5) Any foreseeable environmental incorporated into the public record and mail or by visiting our Web site at impacts directly or indirectly resulting will be fully considered in preparation http://arizonaes.fws.gov/. You may from the proposed designation of of the final rule. We will hold two review comments and materials critical habitat; public informational sessions and received and review supporting (6) Any foreseeable economic or other hearings (see DATES and ADDRESSES documentation used in preparation of impacts resulting from the proposed sections). this proposed rule by appointment, designation of critical habitat, and in particular, any impacts on small entities DATES: Comments must be submitted during normal business hours, at the Arizona Ecological Services Field Office or families; directly to the Service (see ADDRESSES) (7) Whether the economic analysis (see ADDRESSES). on or before July 6, 2006, or at the identifies all State and local costs, and public hearings. FOR FURTHER INFORMATION CONTACT: if not, what other costs should be We will hold a public informational Steve Spangle, Field Supervisor, included; session from 3 p.m. to 4:30 p.m., Arizona Ecological Services Field Office (8) Whether the economic analysis followed by a public hearing from 6:30 (telephone, 602–242–0210; facsimile, makes appropriate assumptions p.m. to 8 p.m., on each of the following 602–242–2513). regarding current practices and likely dates: SUPPLEMENTARY INFORMATION: regulatory changes imposed as a result 1. June 13, 2006: Camp Verde, Public Comments Solicited of the designation of critical habitat; Arizona. (9) Whether the economic analysis 2. June 20, 2006: Silver City, New We intend that any final action correctly assesses the effect on regional Mexico. resulting from this proposal will be as costs associated with land- and water- ADDRESSES: accurate and as effective as possible. use controls that derive from the Therefore, we solicit comments or designation; Information Sessions/Hearings suggestions from the public, other (10) Whether the critical habitat The public informational sessions and concerned governmental agencies, the designation will result in hearings will be held at the following scientific community, industry, or any disproportionate economic impacts to locations: other interested party concerning the specific areas that should be evaluated 1. Camp Verde, AZ: Cliff Castle proposed rule, the draft economic for possible exclusion from the final Casino Hotel & Conference Center, Tri- analysis, and the draft environmental designation; City Room, 555 Middle Verde Road. assessment. Based on public comment (11) Whether the economic analysis 2. Silver City, NM: Flame Convention on the proposed rule, the draft appropriately identifies all costs that Center, 2800 Pinos Altos Road. economic analysis, and the could result from the designation or For information on requesting environmental assessment, as well as on coextensively from the listing of these reasonable accommodations to attend a the conclusions of the final economic species in 1986; session, see ‘‘Public Comments analysis and environmental assessment, (12) Based on the information in the Solicited’’ under SUPPLEMENTARY we may find during the development of draft economic analysis, we are INFORMATION. our final determination that some areas considering excluding the Verde River proposed do not contain the features Unit based on disproportionate costs Comments that are essential to the conservation of from the final designation per our If you wish to comment on the the species, are appropriate for discretion under section 4(b)(2) of the proposed rule, draft economic analysis, exclusion under section 4(b)(2) of the Act. We are specifically seeking

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comment along with additional Background that aid habitat conservation in the areas information on the estimated costs, how On December 20, 2005, we proposed proposed for designation. In the case of these estimated costs are distributed to designate critical habitat for habitat conservation, these costs would within the Verde River Unit, and spikedace and loach minnow of reflect the costs associated with the whether we should exclude all or a approximately 633 stream miles (mi) commitment of resources to comply portion of the Verde River Unit based on (1018.7 stream kilometers (km)) of with habitat protection measures. The disproportionate costs from the final critical habitat, which includes various analysis also addresses how potential designation per our discretion under stream segments and their associated economic impacts are likely to be section 4(b)(2) of the Act; and riparian areas, including the stream at distributed. (13) Whether the benefit of exclusion bankfull width and a 300-foot buffer on We did not propose Bear Creek, a in any particular area outweigh the either side of the stream banks (70 FR tributary of the Gila River in New benefits of inclusion under Section 75546). The proposed designation Mexico, as critical habitat because there 4(b)(2) of the Act. includes Federal, State, Tribal, and had been no information to indicate this Our practice is to make comments, private lands in Arizona and New area was occupied by either species. including names and home addresses of Mexico. However, we have since received respondents, available for public review Critical habitat identifies specific information to indicate this area is during regular business hours. We will areas containing features essential to the occupied by loach minnow. Due to our not consider anonymous comments and conservation of a listed species and that tight timeframe for completion of the we will make all comments available for may require special management final rule and associated documents we public inspection in their entirety. considerations or protection. If the are not able to consider inclusion of Comments and materials received will proposed critical habitat designation is Bear Creek at this time. However, if the be available for public inspection, by finalized, section 7(a)(2) of the Act critical habitat designation is amended appointment, during normal business would require that Federal agencies in the future we will consider inclusion hours at the Arizona Ecological Services ensure that actions they fund, authorize, of this area at that time. Field Office (see ADDRESSES). or carry out are not likely to result in the Corrected Coordinates for Proposed All previous comments and destruction or adverse modification of critical habitat. Units of Critical Habitat information submitted during the initial Section 4 of the Act requires that we comment period on the proposed rule consider economic and other relevant Below we provide corrected legal need not be resubmitted. If you wish to impacts prior to making a final decision descriptions for the spikedace and loach comment, you may submit your on what areas to designate as critical minnow proposed critical habitat comments and materials concerning this habitat. We may revise the proposal, or designation. Following the publication proposal by any one of several methods its supporting documents, to of the proposed rule on December 20, (see ADDRESSES). Our final designation incorporate or address new information 2005, and in part through comments we of critical habitat for the spikedace and received during the comment period. In received during the subsequent loach minnow will take into particular, we may exclude an area from comment period, we determined that consideration all comments and any critical habitat if we determine that the some of the critical habitat units were additional information received during benefits of excluding the area outweigh incorrectly described. In particular, in both comment periods. the benefits of including the area as Table 2, the column headings for Persons needing reasonable critical habitat, provided such exclusion Arizona and New Mexico were accommodations in order to attend and will not result in the extinction of the inadvertently switched. We have since participate in a public hearing should species. corrected the descriptions and tables to contact the Field Supervisor, Arizona The draft economic analysis considers accurately reflect what we are proposing Ecological Services Field Office, at the and attempts to quantify the potential as critical habitat, and we provide the address or phone number listed in the economic effects of efforts to protect the corrected descriptions for all critical ADDRESSES and FOR FURTHER spikedace and loach minnow and their habitat units below. Table 1 below INFORMATION CONTACT sections as soon habitat, collectively referred to as provides a corrected version of Table 2 as possible. In order to allow sufficient ‘‘spikedace and loach minnow from the December 20, 2005, proposed time to process requests, please call no conservation activities,’’ in the proposed rule (70 FR 75546) with approximate later than one week before the hearing. critical habitat designation, as well as distances by major landowner type. Information regarding this proposal is the economic effects of protective Corrected Geographic Information available in alternative formats upon measures taken as a result of the listing System (GIS) layers are available at request. or other Federal, State, and local laws http://criticalhabitat.fws.gov/.

TABLE 1.—APPROXIMATE CRITICAL HABITAT IN STREAM KILOMETERS AND MILES [7 River Units]

New Mexico Arizona Total Land owner km (mi) km (mi) km (mi)

Federal ...... 167.71 (269.90) 197.99 (318.63) 365.7 (588.53) Tribal ...... 0.0 (0.0) 33.00 (53.11) 33.00 (53.11) State ...... 1.32 (2.12) 8.32 (13.39) 9.64 (15.51) County ...... 0.0 (0.0) 0.0 (0.0) 0.0 (0.0) Private ...... 89.73 (144.40) 134.44 (216.36) 224.17 (360.76)

Total ...... 258.75 (416.42) 373.75(601.49) 632.51 (1017.91)

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No additional mileage was Circular A–4, September 17, 2003). businesses include manufacturing and incorporated into the proposed Pursuant to Circular A–4, once it has mining concerns with fewer than 500 designation through the corrections been determined that the Federal employees, wholesale trade entities provided in Table 1. Mileage was regulatory action is appropriate, the with fewer than 100 employees, retail reduced by approximately 0.51 mi (0.82 agency will need to consider alternative and service businesses with less than $5 km) for Eagle Creek after correcting for regulatory approaches. Since the million in annual sales, general and a mapping error in the original proposal. determination of critical habitat is a heavy construction businesses with less Mileage was additionally modified for statutory requirement pursuant to the than $27.5 million in annual business, East Fork Black River and North Fork Act, we must then evaluate alternative special trade contractors doing less than East Fork Black River due to a change regulatory approaches, where feasible, $11.5 million in annual business, and in our determination of the confluence when promulgating a designation of agricultural businesses with annual points of these two streams. Mileage critical habitat. sales less than $750,000. To determine that was previously attributed to North In developing our designations of if potential economic impacts to these Fork East Fork Black River is now critical habitat, we consider economic small entities are significant, we encompassed in the mileage for East impacts, impacts to national security, considered the types of activities that Fork Black River. The overall mileage and other relevant impacts under might trigger regulatory impacts under for these two streams remained the section 4(b)(2) of the Act. Based on the this designation as well as types of same. The majority of the changes discretion allowable under this project modifications that may result. In correct errors in the Township, Range, provision, we may exclude any general, the term significant economic and section descriptions provided for particular area from the designation of impact is meant to apply to a typical each proposed critical habitat unit. critical habitat, provided that the small business firm’s business All legal descriptions for New Mexico benefits of such exclusion outweigh the operations. and Arizona are based on the Public benefits of specifying the area as critical To determine if this proposed Lands Survey System (PLSS). Within habitat and that such exclusion would designation of critical habitat for the this system, all coordinates reported for not result in the extinction of the spikedace and loach minnow would New Mexico are in the New Mexico species. As such, we believe that the affect a substantial number of small Principal Meridian (NMPM), while evaluation of the inclusion or exclusion entities, we considered the number of those in Arizona are in the Gila and Salt of particular areas, or combination small entities affected within particular River Meridian (GSRM). All mileage thereof, in a designation constitutes our types of economic activities (e.g., water calculations were performed using GIS. regulatory alternative analysis. management and use, livestock grazing, residential and related development, Required Determinations—Amended Regulatory Flexibility Act (5 U.S.C. 601 spikedace- and loach minnow-specific et seq.) This revised proposed rule affirms the management activities, recreation information contained in the December Under the Regulatory Flexibility Act activities, fire management activities, 20, 2005, proposed rule (70 FR 75546) (RFA) (5 U.S.C. 601 et seq.), as amended mining, and transportation). We concerning Executive Orders (EO) 13132 by the Small Business Regulatory considered each industry or category and EO 12988; the Paperwork Reduction Enforcement Fairness Act (5 U.S.C. individually to determine if certification Act; the National Environmental Policy 802(2)) (SBREFA), whenever an agency is appropriate. In estimating the Act; and the President’s memorandum is required to publish a notice of numbers of small entities potentially of April 29, 1994, ‘‘Government-to- rulemaking for any proposed or final affected, we also considered whether Government Relations with Native rule, it must prepare and make available their activities have any Federal American Tribal Governments’’ (59 FR for public comment a regulatory involvement. Some kinds of activities 22951). Based on the draft economic flexibility analysis that describes the are unlikely to have any Federal analysis, we are amending our required effect of the rule on small entities (i.e., involvement and so will not be affected determinations, as provided below, small businesses, small organizations, by the designation of critical habitat. concerning EO 12866 and the and small government jurisdictions). Designation of critical habitat only Regulatory Flexibility Act; EO 13211 However, no regulatory flexibility affects activities conducted, funded, and 12630; and the Unfunded Mandates analysis is required if the head of an permitted, or authorized by Federal Reform Act. agency certifies the rule will not have a agencies; non-Federal activities are not significant economic impact on a affected by the designation. Regulatory Planning and Review substantial number of small entities. If this proposed critical habitat In accordance with EO 12866, this Based upon our draft economic analysis designation is made final, Federal document is a significant rule because it of the proposed designation, we provide agencies must consult with us if their may raise novel legal and policy issues. our factual basis for determining that activities may affect designated critical However, based on our draft economic this rule will not result in a significant habitat. Consultations to avoid the analysis, it is not anticipated that the economic impact on a substantial destruction or adverse modification of proposed designation of critical habitat number of small entities. This critical habitat would be incorporated for the spikedace and loach minnow determination is subject to revision into the existing consultation process. would result in an annual effect on the based on comments received as part of Our economic analysis of this economy of $100 million or more or the final rulemaking. proposed designation evaluated the affect the economy in a material way. According to the Small Business potential economic effects on small Due to the timeline for publication in Administration (SBA), small entities business entities and small governments the Federal Register, the Office of include small organizations, such as resulting from conservation actions Management and Budget (OMB) has not independent nonprofit organizations related to the listing of this species and formally reviewed the proposed rule or and small governmental jurisdictions, proposed designation of its critical accompanying economic analysis. including school boards and city and habitat. We evaluated small business Further, EO 12866 directs Federal town governments that serve fewer than entities in nine categories: water Agencies promulgating regulations to 50,000 residents, as well as small management and use, livestock grazing evaluate regulatory alternatives (OMB, businesses (13 CFR 121.201). Small activities, mining operations, spikedace

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and loach minnow-specific management that contain proposed critical habitat, or $5,900 per housing unit ($190 to $300 activities, recreation, residential and 1 percent of ranches in New Mexico and annually, if costs are distributed evenly commercial development, Tribal Arizona—could be impacted by over 20 years). Actual conservation activities, transportation activities, and conservation activities. Annual costs to requirements undertaken by an fire management activities. Based on our each of these 76 ranching operations individual landowner will depend on analysis, impacts associated with small may be between $390 and $9,200 per how much of a parcel crosses proposed entities are anticipated to occur to water ranch. Average revenues of a ranch in critical habitat. It is important to note management and use, livestock grazing, the proposed critical habitat region are that it is likely that some or all housing residential and commercial $133,000, or between 0.3 and 7 percent subdivisions may be developed by large development, Tribal businesses, of a ranch’s estimated average revenue. corporations which do not qualify as transportation, and fire management. It Approximately 94 percent of beef cattle small businesses under RFA/SBRFA. should be noted that the majority of ranching and farming operations in Furthermore, because there is no loss in Tribal lands are under consideration for counties containing spikedace and loach housing units estimated, there would exclusion at this time. The following is minnow critical habitat are small likely not be any impact to small a summary of the information contained businesses; thus approximately 72 small businesses that are residential housing in the draft economic analysis: ranching operations may experience a sub-contractors. In addition, individual reduction in revenues. Because only 1 single-family home development has (a) Water Management and Use Related percent of ranches in New Mexico and not historically been subject to to Agricultural Production Arizona, or 4.7 percent of ranches, in consultation or habitat conservation According to the draft economic affected counties are estimated to be requirements for the spikedace and analysis, spikedace and loach minnow impacted by this proposal, we have loach minnow in Arizona or New conservation activities have not determined that this proposed Mexico, although consultation could be impacted private crop production since designation will not have an effect on a required if Federal permits from the the listing of the species in 1986. substantial number of small business Army Corps of Engineers, However, because agricultural water use ranching operations. From this analysis, Environmental Protection Agency, or comprises 98 percent of surface water we also have determined that this Federal Emergency Management Agency use and 81 percent of groundwater use proposed designation would also not are required. in counties that contain proposed result in a significant effect to the Because individual single-family critical habitat, it appears most likely annual sales of these small businesses home development has not historically that any additional water supplies impacted by this proposed designation been subject to consultation or habitat needed for the species would because the above analysis has conservation requirements as described potentially come from agriculture. The determined that annual costs may above, the probability that single-family economic analysis estimates that only represent between 0.3 and 7 percent of home development will involve many 810 acres of cropland are included a ranch’s estimated average revenue. larger businesses, as opposed to small within proposed critical habitat, and businesses, and because the impacts only 6,310 acres of cropland are in the (c) Residential and Commercial will not reduce the number of housing vicinity of critical habitat. The average Development units, we have determined that this small farm includes 4,600 acres, and The draft economic analysis proposed designation will not have an farms vary between 1,300 and 8,000 concludes that the most likely location effect on a substantial number of small acres. Based on the fact that at most for development activities within the businesses that are part of residential 9,000 acres of cropland are involved, proposed critical habitat designation is and commercial development. From this and small farms vary in size, we believe within the Verde River Complex, which analysis, we also have determined that that there are not many farms located contains a large amount of private land, this proposed designation would also along the streams proposed for the has a large population, and is projected not result in a significant effect to the designation. Additionally, under the to have substantial human population annual sales of these small businesses assumption that all farms are small growth over the next 20 years. No North impacted by this proposed designation. (1,884 small business farming American Industry Classification This is because of the above analysis operations across five affected counties), System (NAICS) code exists for which has determined that each housing there would be well less than one landowners, and the Small Business unit would bear at most a cost of $190 percent of small farm businesses Administration does not provide a to $300 annually, if costs are distributed impacted by this proposed designation. definition of a small landowner. evenly over 20 years. As a result of this information, we have However, recognizing that it is possible (d) Tribal Businesses determined that this proposed that some of the landowners may be designation will not have an effect on a small businesses, this analysis provides The proposed critical habitat substantial number of small business information concerning the number of development includes lands of the farming operations. landowners potentially affected and the Yavapai-Apache Nation (1.6 km (1 mi) size of the impact on those owners. The of tributary proposed as critical habitat), (b) Livestock Grazing Activities draft economic analysis (section 7) San Carlos Apache Tribe (17.2 km (27.7 Ranching operations that hold grazing estimates that 1,646 housing units could mi) of tributary proposed as critical allotment permits are anticipated to be be built on the approximately 2,880 habitat), and White Mountain Apache impacted by conservation activities for privately owned acres within proposed Tribe (12.5 km (20.1 mi) of tributary the spikedace and loach minnow. The critical habitat over the next 20 years. proposed as critical habitat). The Tribes costs assumed to be incurred by Impacts to developers are estimated to have expressed concerns that critical livestock operations are primarily due to include fencing costs, scientific studies, habitat on their lands will have a anticipated installation and surveying and monitoring requirements, disproportionate impact on their ability maintenance of riparian fencing. The and possibly off-setting mitigation to use resources on their sovereign lands economic analysis concluded that (habitat set-aside). Costs are estimated to and to successfully achieve economic approximately 76 ranches—or 4.7 range from $3.1 million to $4.8 million self-sufficiency. However, Tribal percent of ranches in affected counties per large development, or $3,900 to governments are not classified as small

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businesses under RFA/SBRFA, whereas Existing models of angler behavior in Executive Order that outlines nine Tribal corporations may qualify as small these areas were not available to refine outcomes that may constitute ‘‘a businesses under RFA/SBRFA. The this estimate. significant adverse effect’’ when draft economic analysis concluded that The two stream reaches where compared without the regulatory action future economic costs of implementing impacts on recreation are anticipated under consideration. The draft spikedace and loach minnow are located in Yavapai County, Arizona, economic analysis finds that none of conservation efforts on Tribal lands and Catron County, New Mexico. If, as these criteria are relevant to this could include administrative costs of in the low-end estimate of impacts, analysis; thus, energy-related impacts consultation, surveys and monitoring, angler trips are not lost, but instead are associated with spikedace and loach modifications to grazing, fire redistributed to other streams, then minnow conservation activities within management, and recreation activities, regional impacts on small businesses are proposed critical habitat are not and potential project modifications to likely to be minimal. If, as in the high- expected. grazing, fire management, and end estimate of impacts, angler trips to recreation activities, and potential the two stream reaches that currently Unfunded Mandates Reform Act (2 project modifications to restoration stock nonnative fish are not undertaken, U.S.C. 1501 et seq.) activities. Impacts in each of these areas localized impacts on anglers and, in In Accordance With the Unfunded could affect the Tribes’ revenues and turn, small businesses that rely on Mandates Reform Act (2 U.S.C. 1501), employment in the future; however, fishing activities could occur. These the Service Makes the Following many of these impacts may not fall on impacts would be spread across a Findings Tribal corporations, as opposed to the variety of industries, including food and (a) This rule will not produce a Tribal governments in question. It beverage stores, food service and Federal mandate. In general, a Federal should be noted that the lands of both drinking places, accommodations, mandate is a provision in legislation, the White Mountain Apache Tribe and transportation, and sporting goods. statute, or regulation that would impose the San Carlos Apache Tribe are These industries generate approximately an enforceable duty upon State, local, or proposed for exclusion from the critical $829 million in total annual sales for tribal governments, or the private sector, habitat designation in the proposed rule. these two counties. The high-end and includes both ‘‘Federal Because both White Mountain Apache estimate of annual loss of $485,000 in intergovernmental mandates’’ and Tribe and the San Carlos Apache Tribe trip expenditures would therefore are proposed for exclusion from the represent a loss of approximately 0.06 ‘‘Federal private sector mandates.’’ critical habitat designation in the percent of annual revenues for these These terms are defined in 2 U.S.C. proposed rule and only 1.6 km (1 mi) of businesses. 658(5)–(7). ‘‘Federal intergovernmental stream tributary is proposed as critical We have determined that this mandate’’ includes a regulation that habitat on Yavapai-Apache Nation, we proposed designation will not have an ‘‘would impose an enforceable duty have determined this proposed effect on a substantial number of small upon State, local, or tribal designation will not have an effect on a businesses that may be impacted from governments,’’ with the following two substantial number of small businesses lost recreation because these angler days exceptions: It excludes ‘‘a condition of on Tribal lands. are likely to be redistributed to other federal assistance’’ and ‘‘a duty arising areas rather than lost altogether. From from participation in a voluntary (e) Recreation this analysis, we also have determined Federal program,’’ unless the regulation Areas currently stocked with non- that this proposed designation would ‘‘relates to a then-existing Federal native rainbow trout include the Camp not result in a significant effect to the program under which $500,000,000 or Verde area of the Verde River in annual sales of these small businesses more is provided annually to State, Complex 1 and East Fork Gila River in impacted by this proposed designation local, and tribal governments under complex 5. The future impact of because any potential impact to small entitlement authority,’’ if the provision proposed critical habitat on the stocking businesses from lost anglers not fishing would ‘‘increase the stringency of regimes in these reaches is unknown, as in an area is likely to be redistributed to conditions of assistance’’ or ‘‘place caps is the reduction in fishing activity that other areas and, if they are not upon, or otherwise decrease, the Federal would occur if stocking is curtailed. redistributed, then they would represent Government’s responsibility to provide Further, it is unknown whether a loss of approximately 0.06 percent of funding’’ and the State, local, or tribal nonnative fish stocking may be replaced annual revenues for these businesses. governments ‘‘lack authority’’ to adjust with catchable native fish stocking (e.g. accordingly. At the time of enactment, Apache trout). Thus, the analysis in the E.O. 13211 these entitlement programs were: economic analysis estimates the value of On May 18, 2001, the President issued Medicaid; AFDC work programs; Child angler days at risk if sportfish stocking E.O. 13211 on regulations that Nutrition; Food Stamps; Social Services were discontinued on these reaches as significantly affect energy supply, Block Grants; Vocational Rehabilitation part of the high-end estimates. Angling distribution, and use. E.O. 13211 State Grants; Foster Care, Adoption trips are valued at approximately $8.6 requires agencies to prepare Statements Assistance, and Independent Living; million over 20 years (or $816,000 of Energy Effects when undertaking Family Support Welfare Services; and annually), assuming a discount rate of 7 certain actions. This proposed rule is Child Support Enforcement. ‘‘Federal percent. It should be noted that because considered a significant regulatory private sector mandate’’ includes a State fish managers typically identify action under E.O. 12866 due to its regulation that ‘‘would impose an alternative sites for stocked fish when potentially raising novel legal and enforceable duty upon the private areas are closed to stocking, these angler policy issues, but it is not expected to sector, except (i) a condition of Federal days are likely to be redistributed to significantly affect energy supplies, assistance; or (ii) a duty arising from other areas rather than lost altogether. distribution, or use. Appendix B of the participation in a voluntary Federal Thus, the high-end estimate does not draft economic analysis provides a program.’’ consider the possibility that rather than discussion and analysis of this The designation of critical habitat not fishing at all, recreators will visit determination. The OMB has provided does not impose a legally binding duty alternative, less desirable fishing sites. guidance for implementing this on non-Federal Government entities or

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private parties. Under the Act, the only spikedace and loach minnow does not (7) Complex 3—Middle Gila/Lower regulatory effect is that Federal agencies pose significant takings implications. San Pedro/Aravaipa Creek, Pinal and must ensure that their actions do not Graham counties, Arizona. List of Subjects in 50 CFR Part 17 destroy or adversely modify critical (i) Aravaipa Creek—no changes from habitat under section 7. Non-Federal Endangered and threatened species, the proposed rule at this time. entities that receive Federal funding, Exports, Imports, Reporting and (ii) Turkey Creek—2.7 miles (4.3 km) assistance, or permits, or that otherwise recordkeeping requirements, of creek extending from the confluence require approval or authorization from a Transportation. with Aravaipa Creek at Township 6 Federal agency for an action, may be South, Range 19 East, section 19 Proposed Rule Promulgation indirectly impacted by the designation upstream to the confluence with Oak of critical habitat. However, the legally Accordingly, we propose to amend Grove Canyon at Township 6 South, binding duty to avoid destruction or part 17, subchapter B of chapter I, title Range 19 East, section 32. Land adverse modification of critical habitat 50 of the Code of Federal Regulations, ownership: Bureau of Land rests squarely on the Federal agency. as set forth below: Management. Furthermore, to the extent that non- (iii) Deer Creek—no changes from the Federal entities are indirectly impacted PART 17—[AMENDED] proposed rule at this time. because they receive Federal assistance * * * * * or participate in a voluntary Federal aid 1. The authority citation for part 17 continues to read as follows: (8) Complex 4—San Francisco and program, the Unfunded Mandates Blue Rivers, Pinal and Graham counties, Reform Act would not apply; nor would Authority: 16 U.S.C. 1361–1407; 16 U.S.C. Arizona and Catron County, New critical habitat shift the costs of the large 1531–1544; 16 U.S.C. 4201–4245; Pub. L. 99– Mexico. 625, 100 Stat. 3500; unless otherwise noted. entitlement programs listed above on to (i) Eagle Creek—44.7 miles (71.9 km) State governments. 2. Critical habitat for the loach of creek extending from the Phelps- (b) The draft economic analysis minnow (Tiaroga cobitis) and spikedace Dodge Diversion Dam at Township 4 discusses potential impacts of critical (Meda fulgida) in § 17.95(e), which was South, Range 28 East, section 23 habitat designation for the spikedace proposed on December 20, 2005, at 70 upstream to the confluence of Dry Prong and loach minnow on water FR 75546, is proposed to be amended by and East Eagle creeks at Township 2 management activities, livestock revising some of the critical habitat unit North, Range 28 East, section 29. Land grazing, Tribes, residential and descriptions as follows: ownership: U.S. Forest Service (Apache- commercial development activities, Sitgreaves National Forest), Tribal (San recreation activities, fire management § 17.95 Critical habitat—fish and wildlife. Carlos) lands, and private. activities, mining, and transportation * * * * * (ii) San Francisco River—126.5 miles activities. The analysis estimates that (e) Fishes. (203.5 km) of river extending from the annual costs of the rule could range * * * * * confluence with the Gila River at from $25.2 million to $100.3 million in Township 5 South, Range 29 East, constant dollars over 20 years. Impacts Loach minnow (Tiaroga cobitis) section 21 upstream to the mouth of the are largely anticipated to affect water 1. Critical habitat for the loach Box, a canyon above the town of operators and Federal and State minnow in Arizona and New Mexico is Reserve, at Township 6 South, Range 19 agencies, with some effects on livestock described in detail as follows. West, section 2. Land ownership: grazing operations, residential and * * * * * Bureau of Land Management, U.S. commercial development, and (6) Complex 2—Black River, Apache Forest Service (Apache-Sitgreaves transportation. Impacts on small and Greenlee Counties, Arizona. National Forest), State, and private in governments are not anticipated, or they Arizona, and U.S. Forest Service (Gila are anticipated to be passed through to (i) East Fork Black River—12.2 miles National Forest) and private in New consumers. For example, costs to water (19.7 km) of the river extending from the Mexico. operations would be expected to be confluence with the West Fork Black (iii) Tularosa River—no changes from passed on to consumers in the form of River at Township 4 North, Range 28 the proposed rule at this time. price changes. Consequently, for the East, section 11 upstream to the (iv) Negrito Creek—4.2 miles (6.8 km) reasons discussed above, we do not confluence with an unnamed tributary of creek extending from the confluence believe that the designation of critical approximately 0.51 miles (0.82 km) with the Tularosa River at Township 7 habitat for the spikedace and loach downstream of the Boneyard Creek South, Range 18 West, section 19 minnow will significantly or uniquely confluence at Township 5 North, Range upstream to the confluence with Cerco affect small government entities. As 29 East, section 5. Land ownership: U.S. Canyon at Township 7 South, Range 18 such, a Small Government Agency Plan Forest Service (Apache-Sitgreaves West, section 21. Land ownership: U.S. is not required. National Forest). Forest Service (Gila National Forest), (ii) North Fork East Fork Black and private lands. Takings River—4.4 miles (7.1 km) of river (v) Whitewater Creek—no changes In accordance with E.O. 12630 extending from the confluence with East from the proposed rule at this time. (‘‘Government Actions and Interference Fork Black River and an unnamed (vi) Blue River—51.1 miles (82.2 km) with Constitutionally Protected Private drainage at Township 5, Range 29, of river extending from the confluence Property Rights’’), we have analyzed the section 5 upstream to the confluence with the San Francisco River at potential takings implications of with an unnamed tributary at Township Township 2 South, Range 31 East, proposing critical habitat for the 6 North, Range 29 East, section 30. Land section 31 upstream to the confluence of spikedace and loach minnow in a ownership: U.S. Forest Service (Apache- Campbell Blue and Dry Blue Creeks at takings implications assessment. The Sitgreaves National Forest). Township 7 South, Range 21 West, takings implications assessment (iii) Boneyard Creek—no changes section 6. Land ownership: U.S. Forest concludes that this proposed from proposed rule at this time. Service (Apache-Sitgreaves National designation of critical habitat for the * * * * * Forest) and private lands in Arizona;

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U.S. Forest Service (Gila National Spikedace (Meda fulgida) and East Eagle Creeks at Township 2 Forest) in New Mexico. 1. Critical habitat for the spikedace in North, Range 28 East, section 29. Land (vii) Campbell Blue Creek—no Arizona and New Mexico is depicted on ownership: Bureau of Land changes from the proposed rule at this the following overview map and Management, U.S. Forest Service time. described in detail following the map. (Apache-Sitgreaves National Forest), (viii) Dry Blue Creek—3.0 miles (4.8 Tribal (San Carlos), and private lands. * * * * * km) of creek extending from the * * * * * confluence with Campbell Blue Creek at (6) Complex 1—Verde River, Yavapai (9) Complex 5—Upper Gila River Township 7 South, Range 21 West, County, Arizona. Complex, Catron, Grant, and Hidalgo section 6 upstream to the confluence (i) Verde River—106.5 miles (171.4 counties, New Mexico. with Pace Creek at Township 6 South, km) of river extending from the Range 21 West, section 28. Land confluence with Fossil Creek at (i) Upper Gila River—no changes from ownership: U.S. Forest Service (Gila Township 11 North, Range 6 East, the proposed rule at this time. National Forest). section 25 upstream 106.5 (171.4 km) (ii) East Fork Gila River—26.1 miles (ix) Pace Creek—no changes from the miles to Sullivan Dam at Township 17 (42.0 km) of river extending from the proposed rule at this time. North, Range 2 West, section 15. Land confluence with the West Fork Gila (x) Frieborn Creek—1.1 miles (1.8 km) ownership: U.S. Forest Service River at Township 13 South, Range 13 of creek extending from the confluence (Coconino, Prescott, and Tonto National West, section 8 upstream to the with Dry Blue Creek at Township 7 Forests), Tribal (Yavapai Apache confluence of Beaver and Taylor creeks South, Range 21 West, section 6 Nation), State, and private lands. at Township 11 South, Range 12 West, upstream to an unnamed tributary at * * * * * section 17. Land ownership: U.S. Forest Township 7 South, Range 21 West, (7) Complex 3—Middle Gila/Lower Service (Gila National Forest) and section 8. Land ownership: U.S. Forest San Pedro/Aravaipa Creek, Pinal and private lands. Service (Gila National Forest). Graham counties, Arizona. (iii) Middle Fork Gila River—7.7 (xi) Little Blue Creek—no changes (i) Gila River—no changes from the miles (12.3 km) of river extending from from the proposed rule at this time. proposed rule at this time. the confluence with the West Fork Gila * * * * * (ii) Lower San Pedro River—no River at Township 12 South, Range 14 (9) Complex 5—Upper Gila River changes from the proposed rule at this West, section 25 upstream to the Complex, Catron, Grant, and Hidalgo time. confluence with Big Bear Canyon at counties, New Mexico. (iii) Aravaipa Creek—28.1 miles (45.3 Township 12 South, Range 14 West, (i) Upper Gila River—no changes from km) of creek extending from the section 2. Land ownership: U.S. Forest the proposed rule at this time. confluence with the San Pedro River at Service (Gila National Forest) and (ii) East Fork Gila River—26.1 miles Township 7 South, Range 16 East, private lands. (42.0 km) of river extending from the section 9 upstream to the confluence (iv) West Fork Gila River—no changes confluence with the West Fork Gila with Stowe Gulch at Township 6 South, from the proposed rule at this time. Range 19 East, section 35. Land River at Township 13 South, Range 13 * * * * * West, section 8 upstream to the ownership: Bureau of Land confluence of Beaver and Taylor Creeks Management, Tribal, State, and private Authority at Township 11 South, Range 12 West, lands. The authority for this action is the section 17. Land ownership: U.S. Forest * * * * * Endangered Species Act of 1973 (16 Service (Gila National Forest) and (8) Complex 4—San Francisco and U.S.C. 1531 et seq.). private lands. Blue Rivers, Pinal and Graham counties, (iii) Middle Fork Gila River—no Arizona. Dated: May 25, 2006. changes from the proposed rule at this (i) Eagle Creek—44.7 miles (71.9 km) Matt Hogan, time. of creek extending from the Phelps- Acting Assistant Secretary for Fish and (iv) West Fork Gila River—no changes Dodge Diversion Dam at Township 4 Wildlife and Parks. from the proposed rule at this time. South, Range 28 East, section 23 [FR Doc. E6–8645 Filed 6–5–06; 8:45 am] * * * * * upstream to the confluence of Dry Prong BILLING CODE 4310–55–P

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Notices Federal Register Vol. 71, No. 108

Tuesday, June 6, 2006

This section of the FEDERAL REGISTER license would not be consistent with the comments directly into the comment contains documents other than rules or requirements of 35 U.S.C. 209 and 37 field on this Web page or attach a file proposed rules that are applicable to the CFR 404.7. for lengthier comments. Go to http:// public. Notices of hearings and investigations, www.regulations.gov and, in the Richard J. Brenner, committee meetings, agency decisions and ‘‘Search for Open Regulations’’ box, rulings, delegations of authority, filing of Assistant Administrator. select ‘‘Food Safety and Inspection petitions and applications and agency [FR Doc. E6–8647 Filed 6–5–06; 8:45 am] statements of organization and functions are Service’’ from the agency drop-down examples of documents appearing in this BILLING CODE 3410–03–P menu, then click on ‘‘Submit.’’ In the section. Docket ID column, select the FDMS Docket Number FSIS–2006–0016 to DEPARTMENT OF AGRICULTURE submit or view public comments and to DEPARTMENT OF AGRICULTURE Food Safety and Inspection Service view supporting and related materials available electronically. Agricultural Research Service [Docket No. FSIS–2006–0016] Mail, including floppy disks or CD– ROM’s, and hand- or courier-delivered Notice of Intent To Grant Exclusive Codex Alimentarius Commission: 29th items: Send to FSIS Docket Room, License Session of the Codex Alimentarius Docket Clerk, USDA, Food Safety and Commission AGENCY: Agricultural Research Service, Inspection Service (FSIS), 300 12th USDA. AGENCY: Office of the Under Secretary Street, SW., Room 102, Cotton Annex ACTION: Notice of intent. for Food Safety, USDA. Building, Washington, DC 20250. ACTION: Notice of public meeting and Electronic mail: SUMMARY: Notice is hereby given that request for comments. [email protected]. the U.S. Department of Agriculture, All submissions received must Agricultural Research Service, intends SUMMARY: The Office of the Under include the Agency name and docket to grant to Aerotech Laboratories Inc. of Secretary for Food Safety, U.S. number FSIS–2006–0016. Phoenix, Arizona, an exclusive license Department of Agriculture (USDA) is All comments submitted in response to U.S. Patent Application Serial No. 10/ sponsoring a public meeting on June 15, to this notice, as well as research and 670,575, ‘‘High Efficiency Electrostatic 2006. The objective of the public background information used by FSIS in Air Sampler’’, filed on September 26, meeting is to provide information and developing this document, will be 2003. receive public comments on agenda posted to the regulations.gov Web site. items and draft United States’ positions The background information and DATES: Comments must be received that will be discussed at the 29th comments also will be available for within thirty (30) days of the date of Session of the Codex Alimentarius public inspection in the FSIS Docket publication of this Notice in the Federal Commission (CAC), that will be held in Room at the address listed above Register. Geneva, Switzerland, July 3–7, 2006. between 8:30 a.m. and 4:30 p.m., ADDRESSES: Send comments to: USDA, The Under Secretary for Food Safety Monday through Friday. ARS, Office of Technology Transfer, recognizes the importance of providing For Further Information about the 5601 Sunnyside Avenue, Rm. 4–1174, interested parties the opportunity to 29th Session of the CAC Contact: F. Beltsville, Maryland 20705–5131. obtain background information on the Edward Scarbrough, U.S. Manager for FOR FURTHER INFORMATION CONTACT: June 29th Session of CAC and to address Codex, Office of the Under Secretary for Blalock of the Office of Technology items on the agenda. Food Safety, U.S. Department of Transfer at the Beltsville address given DATES: The public meeting is scheduled Agriculture, 1400 Independence above; telephone: 301–504–5989. for Thursday, June 15, 2006 from 1 p.m. Avenue, SW., Washington, DC 20250, SUPPLEMENTARY INFORMATION: The to 4 p.m. Phone: (202) 205–7760, Fax: (202) 720– Federal Government’s patent rights in ADDRESSES: The public meeting will be 3157, E-mail: [email protected]. this invention are assigned to the United held in Room 107–A, J.L. Whitten For Further Information about the States of America, as represented by the Building, U.S. Department of Public Meeting Contact: Jasmine Secretary of Agriculture. It is in the Agriculture, 1400 Independence Matthews, U.S. Codex Office, Food public interest to so license this Avenue, SW., Washington, DC. Safety and Inspection Service, Room invention as Aerotech Laboratories Inc. Documents related to the 29th Session 4861, South Building, 1400 of Phoenix, Arizona has submitted a of the CAC will be accessible via the Independence Avenue, SW., complete and sufficient application for World Wide Web at the following Washington, DC 20250, Phone: (202) a license. The prospective exclusive address: http:// 205–7760, Fax: (202) 720–3157. license will be royalty-bearing and will www.codexalimentarius.net/ SUPPLEMENTARY INFORMATION: comply with the terms and conditions current.asp. Background of 35 U.S.C. 209 and 37 CFR 404.7. The The Food Safety and Inspection prospective exclusive license may be Service (FSIS) invites interested persons The Codex Alimentarius (Codex) was granted unless, within thirty (30) days to submit comments on this notice. established in 1963 by two United from the date of this published Notice, Comments may be submitted by any of Nations organizations, the Food and the Agricultural Research Service the following methods: Agriculture Organization (FAO) and the receives written evidence and argument Federal eRulemaking Portal: This Web World Health Organization (WHO). which establishes that the grant of the site provides the ability to type short Codex is the major international

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organization for encouraging fair Work on Food Standards—General is available on the FSIS Web page. international trade in food and Implementations Status. Through the Listserv and Web page, protecting the health and economic • Review of the Codex Committee FSIS is able to provide information to a interests of consumers. Through Structure and Mandates of Codex much broader and more diverse adoption of food standards, codes of Committees and Task Forces. audience. In addition, FSIS offers an practice, and other guidelines • Matters arising from the Reports of electronic mail subscription service that developed by its committees, and by the Commission, Codex Committees, provides an automatic and customized promoting their adoption and and Task Forces. notification when popular pages are implementation by governments, Codex • Relations between the Codex updated, including Federal Register seeks to protect the health of consumers Alimentarius Commission and other publications and related documents. and ensure fair practices in trade. International Organizations. This service is available at http:// • The Codex Alimentarius Commission FAO/WHO Project and Trust Fund fsis.usda.gov/news_and_events/ is responsible for making proposals to, for Enhanced Participation in Codex. _ • email subscription/ and allows FSIS– and being consulted by, the Directors- Other Matters arising from FAO and FAIM customers to sign up for WHO. General of the Food and Agriculture • subscription options in eight categories. Organization (FAO) and the World Designation of Countries Options range from recalls to export Health Organization (WHO) on all responsible for Appointing the information to regulations, directives matters pertaining to the Chairpersons of Codex Committees and and notices. Customers can add or implementation of the Joint FAO/WHO Task Forces. delete subscriptions themselves and Each issue listed will be fully Food Standards Programme, the have the option to protect their accounts described in documents distributed, or purpose of which is: with passwords. to be distributed, by the Codex (a) Protecting the health of the Done at Washington, DC, on June 2, 2006. consumers and ensuring fair practices in Secretariat prior to the Meeting. F. Edward Scarbrough, the food trade; Members of the public may access or (b) Promoting coordination of all food request copies of these documents via U.S. Manager for Codex Alimentarius. standards work undertaken by the World Wide Web at the following [FR Doc. 06–5172 Filed 6–2–06; 11:47 am] international governmental and non address: http:// BILLING CODE 3410–DM–M governmental organizations; www.codexalimentarius.net/current.asp (c) Determining priorities and Public Meeting initiating and guiding the preparation of DEPARTMENT OF AGRICULTURE draft standards through and with the aid At the June 15th public meeting, draft Forest Service of appropriate organizations; U.S. positions on the agenda items will (d) Finalizing standards elaborated be described, discussed, and attendees will have the opportunity to pose Notice of Southwest Idaho Resource under (c) above and publishing them in Advisory Committee Meeting a Codex Alimentarius either as regional questions and offer comments. Written comments may be offered at the meeting or world wide standards, together with AGENCY: Forest Service, USDA. international standards already finalized or sent to the U.S. Manager for Codexs, ACTION: Notice of meeting. by other bodies under (b) above, (see For Further Information About the wherever this is practicable; and 29th Session of the CAC Contact). Written comments should state that they SUMMARY: Pursuant to the authorities in (e) Amending published standards, the Federal Advisory Committee Act after appropriate survey, in the light of relate to the activities of the 29th Session of the CAC. (Pub. L. 92–463) and under the Secure developments. Rural Schools and Community Self- Issues To Be Discussed at the Public Additional Public Notification Determination Act of 2000 (Pub. L. 106– Meeting Public awareness of all segments of 393), the Boise and Payette National The following items on the Agenda rulemaking and policy development is Forests’ Southwest Idaho Resource for the 29th Session of the CAC will be important. Consequently, in an effort to Advisory Committee will conduct a discussed during the public meeting: ensure that minorities, women, and business meeting, which is open to the • Election of Chairperson and Vice- persons with disabilities are aware of public. Chairpersons of the Commission Report this notice, FSIS will announce it on- DATES: Wednesday, June 21, 2006, of the 57th Session of the Executive line through the FSIS Web Page located beginning at 10:30 a.m. Committee. at http://www.fsis.usda.gov/regulations/ _ _ ADDRESSES: Idaho Counties Risk • Amendments to the Procedural 2006 Notices Index/. FSIS also will make copies of this Federal Register Management Program Building, 3100 Manual. South Vista Avenue, Boise, Idaho. • Draft Standards and Related Texts publication available through the FSIS submitted to the Commission for Constituent Update, which is used to SUPPLEMENTARY INFORMATION: Agenda Adoption. provide information regarding FSIS topics will include review and approval • Proposed Draft Standards and policies, procedures, regulations, of project proposals, and is an open Related Texts submitted at Step 5. Federal Register notices, FSIS public public forum. • Revocation of existing Codex meetings, recalls and other types of FOR FURTHER INFORMATION CONTACT: Standards and Related Texts. information that could affect or would Doug Gochnour, Designated Federal • Proposals for the Elaboration of new be of interest to constituents and Officer, at 208–392–6681 or e-mail Standards and Related Texts and for the stakeholders. The update is [email protected]. Discontinuation of Work. communicated via Listserv, a free • Strategic Planning of the Codex electronic mail subscription service for Dated: May 30, 2006. Alimentarius Commission. industry, trade and farm groups, Richard A. Smith, • Implementation of the Joint FAO/ consumer interest groups, allied health Forest Supervisor, Boise National Forest. WHO Evaluation of the Codex professionals and other individuals who [FR Doc. 06–5126 Filed 6–5–06; 8:45 am] Alimentarius and other FAO and WHO have asked to be included. The update BILLING CODE 3410–11–M

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DEPARTMENT OF COMMERCE Dated: June 1, 2006. Constitution Avenue, NW., Washington, Gwellnar Banks, DC 20230 (or via the Internet at Submission for OMB Review; Management Analyst, Office of the Chief [email protected]). Comment Request Information Officer. Written comments and [FR Doc. E6–8752 Filed 6–5–06; 8:45 am] recommendations for the proposed The Department of Commerce has BILLING CODE 3510–22–P information collection should be sent submitted to the Office of Management within 30 days of publication of this and Budget (OMB) for clearance the notice to David Rostker, OMB Desk following proposal for collection of DEPARTMENT OF COMMERCE Officer, FAX number (202) 395–7285, or information under the provisions of the [email protected]. Paperwork Reduction Act (44 U.S.C. Submission for OMB Review; Dated: June 1, 2006. Chapter 35). Comment Request Gwellnar Banks, Agency: National Oceanic and The Department of Commerce has Management Analyst, Office of the Chief Atmospheric Administration (NOAA). submitted to the Office of Management Information Officer. Title: Groundfish Tagging Program. and Budget (OMB) for clearance the [FR Doc. E6–8753 Filed 6–5–06; 8:45 am] Form Number(s): None. following proposal for collection of BILLING CODE 3510–22–P OMB Approval Number: 0648–0276. information under the provisions of the Paperwork Reduction Act (44 U.S.C. Type of Request: Regular submission. Chapter 35). DEPARTMENT OF COMMERCE Burden Hours: 88. Agency: National Oceanic and Submission for OMB Review; Number of Respondents: 661. Atmospheric Administration (NOAA). Comment Request Average Hours Per Response: Forms Title: Alaska Cooperatives in the for tagged fish, 5 minutes; electronic Bering Sea and Aleutian Islands. The Department of Commerce has archival tag return, 30 minutes. Form Number(s): None. submitted to the Office of Management OMB Approval Number: 0648–0401. Needs and Uses: The Groundfish and Budget (OMB) for clearance the Type of Request: Regular submission. Tagging Program provides scientists following proposal for collection of Burden Hours: 320. with information necessary for effective information under the provisions of the Number of Respondents: 11. Paperwork Reduction Act (44 U.S.C. conservation, management, and Average Hours Per Response: scientific understanding of the Chapter 35). Cooperative preliminary report, 20 Agency: National Oceanic and groundfish fishery off Alaska and the hours; cooperative final report, 8 hours; Atmospheric Administration (NOAA). Pacific Northwest. The program area inshore cooperative catcher vessel Title: National Estuaries Restoration includes the Pacific Ocean off Alaska pollock catch report, 5 minutes; and Inventory. (the Gulf of Alaska, the Bering Sea and appointment of agent for service of Form Number(s): None. Aleutian Islands Area, the Alexander process, 5 minutes. OMB Approval Number: 0648–0479. Archipelago of Southeast Alaska), Needs and Uses: The cooperative Type of Request: Regular submission. California, Oregon, and Washington. management structure, originally Burden Hours: 787. The distribution, movement rates and implemented by the American Fisheries Number of Respondents: 234. Average Hours Per Response: New direction, growth, recruitment and Act (AFA), has shifted more of the project reports, 4 hours; and project mortality estimated from tag recoveries monitoring and enforcement burden to updates, 2 hours. are important parameters used in the cooperatives and their members; and groundfish population assessment Needs and Uses: The collection of has allowed NMFS to manage the Bering estuary habitat restoration project models and in developing allocation Sea and Aleutian Islands pollock fishery systems. information (e.g., location, habitat type, more precisely. With the flexibility goals, status, monitoring information) Affected Public: Business or other for- provided by cooperatives, vessels are will be undertaken in order to populate profit organizations; individuals or able to individually (and in aggregate) a restoration project database mandated households. come very close to harvesting exactly by the Estuary Restoration Act of 2000. Frequency: On occasion. the amount of pollock they were The database is intended to provide Respondent’s Obligation: Voluntary. allocated. The allocations of pollock and information to improve restoration other species have allowed the AFA OMB Desk Officer: David Rostker, methods, provide the basis for required fleet the ability to spread their effort in (202) 395–3897. reports to Congress, and track estuary time and space to accommodate Steller Copies of the above information habitat acreage restored. Estuary habitat Sea Lion conservation measures. This restoration project information will be collection proposal can be obtained by collection describes some of the calling or writing Diana Hynek, submitted by habitat restoration project recordkeeping and reporting managers through an interactive Web Departmental Paperwork Clearance requirements under the AFA Program. Officer, (202) 482–0266, Department of site, and will be accessible to the public Affected Public: Business or other for- via Internet for data queries and project Commerce, Room 6625, 14th and profit organizations. Constitution Avenue, NW., Washington, reports. Frequency: Annually and on occasion. Affected Public: Not-for-profit DC 20230 (or via the Internet at Respondent’s Obligation: Mandatory. institutions; business or other for-profit [email protected]). OMB Desk Officer: David Rostker, organizations; State, Local or Tribal Written comments and (202) 395–3897. Government; Federal Government. recommendations for the proposed Copies of the above information Frequency: Annually and on occasion. information collection should be sent collection proposal can be obtained by Respondent’s Obligation: Mandatory. within 30 days of publication of this calling or writing Diana Hynek, OMB Desk Officer: David Rostker, notice to David Rostker, OMB Desk Departmental Paperwork Clearance (202) 395–3897. Officer, FAX number (202) 395–7285, or Officer, (202) 482–0266, Department of Copies of the above information [email protected]. Commerce, Room 6625, 14th and collection proposal can be obtained by

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calling or writing Diana Hynek, investors. The data are needed to sample survey, as described; universe Departmental Paperwork Clearance provide reliable, useful, and timely estimates are developed from the Officer, (202) 482–0266, Department of measures of foreign direct investment in reported sample data. Commerce, Room 6625, 14th and the United States, assess its impact on III. Data Constitution Avenue, NW., Washington, the U.S. economy, and based upon this DC 20230 (or via the Internet at assessment, make informed policy OMB Number: 0608–0034. [email protected]). decisions regarding foreign direct Form Number: BE–15. Written comments and investment in the United States. The Type of Review: Regular submission. recommendations for the proposed data are used to derive annual estimates Affected Public: Businesses or other information collection should be sent of the operations of U.S. affiliates of for-profit organizations. within 30 days of publication of this foreign investors, including their Estimated Number of Respondents: notice to David Rostker, OMB Desk balance sheets; income statements; 4,950. Officer, FAX number (202) 395–7285, or property, plant, and equipment; external Estimated Time per Response: 21.8 [email protected]. financing; employment and employee hours. Estimated Total Annual Burden: Dated: June 1, 2006. compensation; merchandise trade; sales of goods and services; taxes; and 107,900 hours. Gwellnar Banks, research and development activity. In Estimated Total Annual Cost: Management Analyst, Office of the Chief addition, data covering employment and $4,316,000 (based on an estimated Information Officer. property, plant, and equipment are reporting burden of 107,900 hours and [FR Doc. E6–8759 Filed 6–5–06; 8:45 am] collected by state. The data are also an estimated hourly cost of $40). BILLING CODE 3510–22–P used to update similar data for the IV. Requests for Comments universe of U.S. affiliates collected once every five years on the BE–12 Comments are invited on: (1) Whether DEPARTMENT OF COMMERCE benchmark survey. the proposed collection of information is necessary for the proper performance Bureau of Economic Analysis BEA proposes the following changes to the survey, beginning with the survey of the functions of the agency, including Proposal To collect Information on the for 2006: (1) Add a question to the BE– whether the information will have Annual Survey of Foreign Direct 15 EZ, short form, and long form to practical utility; (b) the accuracy of the Investment in the United States identify the accounting principles used agency’s estimate of the burden to compile and report the survey data. (including hours and costs) of the ACTION: Proposed collection comment (2) Modify the question on the BE–15 proposed collection of information; (c) request. long form that collects information on ways to enhance the quality, utility, and the major industrial activity of the U.S. clarity of the information to be SUMMARY: The Department of affiliate to include all of the affiliate’s collected; and (d) ways to minimize the Commerce, as part of its continuing major activities; currently, information burden of the collection of information effort to reduce paperwork and on only one major activity is collected. on respondents, including through the respondent burden, invites the general (3) Include a check box on the BE–15 use of automated collection techniques public and other Federal agencies to Supplement C to determine if a U.S. or other forms of information comment on proposed and/or affiliate is claiming an exemption based technology. continuing information collections, as on a merger or on a consolidation; Comments submitted in response to authorized by the Paperwork Reduction currently, a single check box covers this notice will be summarized and/or Act of 1995, Public Law 104–13 (44 both mergers and consolidations. (4) included in the request for OMB U.S.C. 3506(c)(2)(A)). Clarify certain instructions, add approval of this information collection; DATES: Written comments must be illustrative diagrams, and modify they also will become a matter of public submitted on or before 5 p.m., August formatting in an effort to make the record. 7, 2006. survey forms more clear and easier to Dated: June 1, 2006. complete. Taken together, these changes ADDRESSES: Direct all written comments Madeleine Clayton, to Diana Hynek, Departmental will not affect the overall respondent burden for the survey. Management Analyst, Office of the Chief Paperwork Clearance Officer, Information Officer. Department of Commerce, Room 6625, II. Method of Collection [FR Doc. 06–5138 Filed 6–5–06; 8:45 am] 14th and Constitution Avenue, NW., Washington, DC 20230 (or e-mail The BE–15 annual survey is sent to BILLING CODE 3510–06–M [email protected]). potential respondents at the end of March each year. A completed report FOR FURTHER INFORMATION CONTACT: Obie covering a reporting company’s fiscal DEPARTMENT OF COMMERCE G. Whitchard, Chief, International year ending during the previous Investment Division, (BE–50), Bureau of calendar year is due by May 31. Reports Foreign–Trade Zones Board Economic Analysis, U.S. Department of must be filed by every nonbank U.S. Commerce, Washington, DC 20230; Scope Clarification Request Foreign– business enterprise that is owned 10 Trade Subzone 234B(Loading phone (202) 606–9890 (or e-mail percent or more by a foreign investor [email protected]). Equipment and Parts and Components and that has total assets, sales, or net Thereof), LeTourneau, Inc., Longview, SUPPLEMENTARY INFORMATION: income (or loss) of over $30 million. Texas Potential respondents are those nonbank I. Abstract U.S. business enterprises that reported An request for clarification of scope The Annual Survey of Foreign Direct in the 2002 benchmark survey of foreign has been submitted to the Foreign– Investment in the United States (Form direct investment in the United States, Trade Zones Board (the Board) by BE–15) obtains sample data on the along with nonbank businesses that LeTourneau, Inc., operator of Foreign– financial structure and operations of subsequently entered the direct Trade Subzone 234B. A grant of nonbank U.S. affiliates of foreign investment universe. The BE–15 is a authority for LeTourneau’s subzone was

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issued on February 22, 2005, for certain the basis of a notice of intent to deadline specified in 19 CFR activity involving loading equipment, participate, an adequate substantive 351.218(d)(3)(i). components of offshore drilling rigs, log response filed on behalf of the domestic The Department did not receive a handling equipment, cranes, drive interested parties, an inadequate substantive response from any systems, and parts and components response from Canadian and French respondent in any of the sunset reviews thereof. In its original application, interested parties, and no response from of the AD orders on CORE from LeTourneau had indicated that one of other respondent interested parties, the Australia, Germany, Japan, and South its foreign–sourced inputs would be a Department determined to conduct Korea. The Department received a driver assembly, imported duty free expedited sunset reviews of these orders substantive response from Stelco Inc. under subheading 8483.90.5000 of the pursuant to section 751(c)(3)(B) of the (‘‘Stelco’’), a producer and exporter of Harmonized Tariff Schedule of the Act and 19 CFR 351.218(e)(1)(ii)(C)(2). CORE from Canada, in the sunset review United States (HTSUS), to be used in As a result of these sunset reviews, the of the AD order on CORE from Canada. the production of loaders. Department finds that revocation of With respect to the sunset review of the LeTourneau now seeks clarification these AD orders would be likely to lead AD order on CORE from France, the whether its scope includes authority to to continuation or recurrence of Department received a substantive import two subcomponents of the driver dumping at the margins indicated in the response from Duferco Coating SA and assembly and then assemble the drive ‘‘Final Results of Review’’ section of this Sorral SA (collectively, ‘‘Duferco assembly at LeTourneau’s Texas facility notice. Sorral’’) and a waiver of participation (rather than importing the completed EFFECTIVE DATE: June 6, 2006. from Arcelor. The Department driver assembly). The driver–assembly FOR FURTHER INFORMATION CONTACT: John determined that it had received components would be a pre–machined Conniff, Darla Brown or Brandon inadequate respondent participation in hub (HTSUS 7326.90.8587 - 2.9% duty Farlander, AD/CVD Operations, Import each of these sunset reviews. As a rate) and a spindle 7326.19.0000 Administration, International Trade result, pursuant to 19 CFR (HTSUS 7326.19.0000 - 2.9% duty rate). Administration, U.S. Department of 351.218(e)(1)(ii)(C)(2), the Department Public comment is invited from Commerce, 14th Street & Constitution conducted expedited reviews of these interested parties. Submissions shall be Avenue NW, Washington, DC 20230; orders. addressed to the Board’s Executive telephone: (202) 482–1009, (202) 482– On February 28, 2006, the Department Secretary at the address below. The 2849 or (202) 482–0182, respectively. extended the deadline for the final results of these reviews for 90 days, closing period for their receipt is July 6, SUPPLEMENTARY INFORMATION: 2006. A copy of the request is available until May 30, 2006. See Certain for public inspection at the Office of the Background Corrosion–Resistant Carbon Steel Flat Executive Secretary, Foreign–Trade On November 1, 2005, the Department Products from Australia, Canada, France, Germany, Japan, and South Zones Board, U.S. Department of initiated sunset reviews of the AD Korea: Extension of Time Limits for Commerce, Room 1115, 1401 orders on CORE from Australia, Canada, Final Results of Expedited Reviews, 71 Constitution Ave. NW., Washington, DC France, Germany, Japan, and South FR 10006 (February 28, 2006). 20230. Korea pursuant to section 751(c) of the Act. See Initiation of Five-year Dated: May 31, 2006. Scope of the Orders (‘‘Sunset’’) Reviews, 70 FR 65884 The products subject to these orders Dennis Puccinelli, (November 1, 2005). The Department include flat–rolled carbon steel Executive Secretary. received notices of intent to participate [FR Doc. E6–8761 Filed 6–5–06; 8:45 am] products, of rectangular shape, either from the following domestic interested clad, plated, or coated with corrosion– BILLING CODE 3510–DS–S parties: United States Steel Corporation resistant metals such as zinc, aluminum, (‘‘U.S. Steel’’); Mittal Steel USA ISG Inc. or zinc-, aluminum-, nickel- or iron– (‘‘Mittal Steel’’); Nucor Corporation DEPARTMENT OF COMMERCE based alloys, whether or not corrugated (‘‘Nucor’’); Ispat–Inland (‘‘Ispat’’); or painted, varnished or coated with International Trade Administration Oregon Steel Mills, Inc. (‘‘Oregon plastics or other nonmetallic substances Steel’’) (hereinafter, collectively in addition to the metallic coating, in (A–602–803, A–122–822, A–427–808, A–428– ‘‘domestic interested parties’’); and coils (whether or not in successively 816, A–588–824, A–580–816) United Steel, Paper and Forestry, superimposed layers) and of a width of Rubber, Manufacturing, Energy, Allied Final Results of Expedited Sunset 0.5 inch or greater, or in straight lengths Industrial and Service Workers which, if of a thickness less than 4.75 Reviews: Corrosion–Resistant Carbon International Union, AFL–CIO-CLC Steel Flat Products from Australia, mm, are of a width of 0.5 inch or greater (‘‘USW’’), within the deadline specified and which measures at least 10 times Canada, France, Germany, Japan, and in 19 CFR 351.218(d)(1)(i). The South Korea the thickness, or if of a thickness of 4.75 domestic interested parties claimed mm or more, are of a width which AGENCY: Import Administration, interested party status under section exceeds 150 mm and measures at least International Trade Administration, 771(9)(C) of the Act as U.S. producers of twice the thickness, as currently Department of Commerce. the domestic like product. USW claimed classifiable in the Harmonized Tariff SUMMARY: On November 1, 2005, the interested party status under section Schedule of the United States Department of Commerce (‘‘the 771(9)(D) of the Act as a union (‘‘HTSUS’’) under item numbers: Department’’) initiated the sunset representing the domestic CORE 7210.30.0030, 7210.30.0060, reviews of the antidumping duty (‘‘AD’’) industry. We received complete 7210.41.0000, 7210.49.0030, orders on certain corrosion–resistant substantive responses from the domestic 7210.49.0090, 7210.61.0000, 1 carbon steel flat products (‘‘CORE’’) interested parties within the 30-day 7210.69.0000, 7210.70.6030, from Australia, Canada, France, 7210.70.6060, 7210.70.6090, 1 Despite filing a notice of intent to participate, Germany, Japan, and South Korea the USW neither filed its own nor joined the 7210.90.1000, 7210.90.6000, pursuant to section 751(c) of the Tariff domestic interested parties in the substantive 7210.90.9000, 7212.20.0000, Act of 1930, as amended (‘‘the Act’’). On responses filed. 7212.30.1030, 7212.30.1090,

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7212.30.3000, 7212.30.5000, Also excluded from the scope of this carbon steel coil or strip consists of the 7212.40.1000, 7212.40.5000, order are imports of subject following elements identified in 7212.50.0000, 7212.60.0000, merchandise meeting all of the percentage by weight: 0.90% to 1.05% 7215.90.1000, 7215.90.3000, following criteria: (1) Widths ranging carbon; 0.15% to 0.35% silicon; 0.30% 7215.90.5000, 7217.20.1500, from 10 mm (0.394 inches) through 100 to 0.50% manganese; less than or equal 7217.30.1530, 7217.30.1560, mm (3.94 inches); (2) thicknesses, to 0.03% of phosphorous; less than or 7217.90.1000, 7217.90.5030, including coatings, ranging from 0.11 equal to 0.006% of sulfur; other 7217.90.5060, and 7217.90.5090. mm (0.004 inches) through 0.60 mm elements representing 0.24%; and the Included in these orders are flat– (0.024 inches); and (3) a coating that is remainder of iron. See Certain rolled products of nonrectangular cross- from 0.003 mm (0.00012 inches) Corrosion–Resistant Carbon Steel Flat section where such cross-section is through 0.005 mm (0.000196 inches) in Products From Japan: Final Results of achieved subsequent to the rolling thickness and that is comprised of either Changed Circumstances Review, and process (i.e., products which have been two evenly applied layers, the first layer Revocation in Part of Antidumping Duty ‘‘worked after rolling’’) -- for example, consisting of 99% zinc, 0.5% cobalt, Order, 65 FR 53983 (Sept. 6, 2000). products which have been beveled or and 0.5% molybdenum, followed by a Also excluded from the scope of the rounded at the edges. layer consisting of chromate, or three order are imports of carbon steel flat Excluded from the scope of these evenly applied layers, the first layer products meeting the following orders are flat–rolled steel products consisting of 99% zinc, 0.5% cobalt, specifications: carbon steel flat products either plated or coated with tin, lead, and 0.5% molybdenum followed by a measuring 1.64 mm in thickness and chromium, chromium oxides, both tin layer consisting of chromate, and finally 19.5 mm in width consisting of carbon and lead (‘‘terne plate’’), or both a layer consisting of silicate. See Certain steel coil (SAE 1008) with a lining clad chromium and chromium oxides (‘‘tin– Corrosion–Resistant Carbon Steel Flat with an aluminum alloy that is balance free steel’’), whether or not painted, Products From Japan: Final Results of aluminum; 10 to 15% tin; 1 to 3% lead; varnished or coated with plastics or Changed Circumstances Antidumping 0.7 to 1.3% copper; 1.8 to 3.5% silicon; other nonmetallic substances in Duty Administrative Review, and 0.1 to 0.7% chromium; less than 1% addition to the metallic coating. Also Revocation in Part of Antidumping Duty other materials and meeting the excluded from the scope of these orders Order, 64 FR 14862 (Mar. 29, 1999). requirements of SAE standard 783 for are clad products in straight lengths of Also excluded from the scope of this Bearing and Bushing Alloys. See Certain 0.1875 inch or more in composite order are: (1) Carbon steel flat products Corrosion–Resistant Carbon Steel Flat thickness and of a width which exceeds measuring 1.84 mm in thickness and Products From Japan: Final Results of 150 mm and measures at least twice the 43.6 mm or 16.1 mm in width consisting Changed Circumstances Review, and thickness. Also excluded from the scope of carbon steel coil (SAE 1008) clad Revocation in Part of Antidumping Duty of the orders are certain clad stainless with an aluminum alloy that is balance Order, 66 FR 8778 (Feb. 2, 2001). flat–rolled products, which are three– aluminum, 20% tin, 1% copper, 0.3% layered corrosion- resistant carbon steel silicon, 0.15% nickel, less than 1% Also excluded from the scope of the flat–rolled products less than 4.75 mm other materials and meeting the order are carbon steel flat products in composite thickness that consist of a requirements of SAE standard 783 for meeting the following specifications: (1) carbon steel flat–rolled product clad on Bearing and Bushing Alloys; and (2) Carbon steel flat products measuring both sides with stainless steel in a 20%- carbon steel flat products measuring 0.975 mm in thickness and 8.8 mm in 60%-20% ratio. 0.97 mm in thickness and 20 mm in width consisting of carbon steel coil (SAE 1012) clad with a two–layer lining, Japan width consisting of carbon steel coil (SAE 1008) with a two–layer lining, the the first layer consisting of a copper– In addition to the above, the first layer consisting of a copper–lead lead alloy powder that is balance Department has issued the following alloy powder that is balance copper, 9% copper, 9%-11% tin, 9%-11% lead, rulings regarding the scope of the order to 11% tin, 9% to 11% lead, less than maximum 1% other materials and on Japan: 1% zinc, less than 1% other materials meeting the requirements of SAE Excluded from the scope of this order and meeting the requirements of SAE standard 792 for Bearing and Bushing are imports of certain corrosion– standard 792 for Bearing and Bushing Alloys, the second layer consisting of resistant carbon steel flat products Alloys, the second layer consisting of 13%-17% carbon, 13%-17% aromatic meeting the following specifications: 45% to 55% lead, 38% to 50% polyester, with a balance (approx. 66%- widths ranging from 10 mm (0.394 polytetrafluorethylene (‘‘PTFE’’), 3% to 74%) of PTFE; and (2) carbon steel flat inches) through 100 mm (3.94 inches); 5% molybdenum disulfide and less than products measuring 1.02 mm in thicknesses, including coatings, ranging 2% other materials. See Certain thickness and 10.7 mm in width from 0.11 mm (0.004 inches) through Corrosion–Resistant Carbon Steel Flat consisting of carbon steel coil (SAE 0.60 mm (0.024 inches); and a coating Products From Japan: Final Results of 1008) with a two–layer lining, the first that is from 0.003 mm (0.00012 inches) Changed Circumstances Antidumping layer consisting of a copper–lead alloy through 0.005 mm (0.000196 inches) in Duty Review, and Revocation in Part of powder that is balance copper, 9%-11% thickness and that is comprised of three Antidumping Duty Order, 64 FR 57032 tin, 9%-11% lead, less than 0.35% iron, evenly applied layers, the first layer (Oct. 22, 1999). and meeting the requirements of SAE consisting of 99% zinc, 0.5% cobalt, Also excluded from the scope of the standard 792 for Bearing and Bushing and 0.5% molybdenum, followed by a order are imports of doctor blades Alloys, the second layer consisting of layer consisting of chromate, and finally meeting the following specifications: 45%-55% lead, 3%-5% molybdenum a layer consisting of silicate. See Certain carbon steel coil or strip, plated with disulfide, with a balance (approx. 40%- Corrosion–Resistant Carbon Steel Flat nickel phosphorous, having a thickness 52%) of PTFE. See Certain Corrosion– Products From Japan: Final Results of of 0.1524 mm (0.006 inches), a width Resistant Carbon Steel Flat Products Changed Circumstances Antidumping between 31.75 mm (1.25 inches) and From Japan: Notice of Final Results of Duty Administrative Review, and 50.80 mm (2.00 inches), a core hardness Changed Circumstances Review, and Revocation in Part of Antidumping Duty between 580 to 630 HV, a surface Revocation in Part of Antidumping Duty Order, 62 FR 66848 (Dec. 22, 1997). hardness between 900--990 HV; the Order, 66 FR 15075 (Mar. 15, 2001).

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Also excluded from this order are the nickel and iron substrate, with the evidence of separation; having a coating carbon steel flat products meeting the nickel plated coating having a thickness thickness: top side: nickel–graphite, tin– following specifications: (1) carbon steel of 0–5 microns per side with one side nickel layer ≥ 1.0 micrometers; nickel– coil or strip, measuring 1.93 mm or 2.75 equaling at least 2 microns; and with the graphite layer ≥ 0.5 micrometers; bottom mm (0.076 inches or 0.108 inches) in nickel carbon sheet having a thickness side: nickel layer ≥ 1.0 micrometers; (c) thickness, 87.3 mm or 99 mm (3.437 of from 0.004’’ (0.10 mm) to 0.030’’ diffusion–annealed nickel–graphite inches or 3.900 inches) in width, with (0.762 mm) and conforming to the plated products, which are cold–rolled a low carbon steel back comprised of: following chemical specifications (%): C or tin mill black plate base metal carbon under 8%, manganese under ≤ 0.08; Mn ≤ 0.45; P ≤ 0.02; S ≤ 0.02; conforming to the chemical 0.4%, phosphorous under 0.04%, and Al ≤ 0.15; and Si ≤ 0.10; and the requirements based on AISI 1006; sulfur under 0.05%; clad with following physical specifications: having the bottom side of the base metal aluminum alloy comprised of: 0.7% Tensile = 65 KSI maximum; Yield = 32 first electrolytically plated with natural copper, 12% tin, 1.7% lead, 0.3% - 55 KSI; Elongation = 18% minimum nickel, and the top side of the strip then antimony, 2.5% silicon, 1% maximum (aim 34%); Hardness = 85 - 150 Vickers; plated with a nickel–graphite total other (including iron), and Grain Type = Equiaxed or Pancake; composition; with the strip then remainder aluminum; and (2) carbon Grain Size (ASTM) = 7–12; Delta r value annealed to create a diffusion of the steel coil or strip, clad with aluminum, = aim less than 0.2; Lankford value nickel–graphite and the iron substrate measuring 1.75 mm (0.069 inches) in ≥1.2.; and (2) next generation diffusion– on the bottom side; with the nickel– thickness, 89 mm or 94 mm (3.500 annealed nickel plate meeting the graphite and nickel plated material inches or 3.700 inches) in width, with following specifications: (a) Nickel– sufficiently ductile and adherent to the a low carbon steel back comprised of: graphite plated, diffusion–annealed, substrate to permit forming without carbon under 8%, manganese under tin–nickel plated carbon products, with cracking, flaking, peeling, or any other 0.4%, phosphorous under 0.04%, and a natural composition mixture of nickel evidence of separation; having coating sulfur under 0.05%; clad with and graphite electrolytically plated to thickness: top side: nickel–graphite aluminum alloy comprised of: 0.7% the top side of diffusion–annealed tin– layer ≥ 1.0 micrometers; bottom side: copper, 12% tin, 1.7% lead, 2.5% nickel plated carbon steel strip with a nickel layer ≥ 1.0 micrometers; (d) silicon, 0.3% antimony, 1% maximum cold rolled or tin mill black plate base nickel–phosphorous plated diffusion– total other (including iron), and metal conforming to chemical annealed nickel plated carbon product, remainder aluminum. See Certain requirements based on AISI 1006; having a natural composition mixture of Corrosion–Resistant Carbon Steel Flat having both sides of the cold rolled nickel and phosphorus electrolytically Products From Japan: Notice of Final substrate electrolytically plated with plated to the top side of a diffusion– Results of Changed Circumstances natural nickel, with the top side of the annealed nickel plated steel strip with Review, and Revocation in Part of nickel plated strip electrolytically a cold rolled or tin mill black plate base Antidumping Duty Order, 66 FR 20967 plated with tin and then annealed to metal conforming to the chemical (Apr. 26, 2001). Also excluded from this order are create a diffusion between the nickel requirements based on AISI 1006; with carbon steel flat products meeting the and tin layers in which a nickel–tin both sides of the base metal initially following specifications: carbon steel alloy is created, and an additional layer electrolytically plated with natural coil or strip, measuring a minimum of of mixture of natural nickel and graphite nickel, and the material then annealed and including 1.10 mm to a maximum then electrolytically plated on the top to create a diffusion of the nickel and of and including 4.90 mm in overall side of the strip of the nickel–tin alloy; iron substrate; another layer of the thickness, a minimum of and including having a coating thickness: top side: natural nickel–phosphorous then ≥ 76.00 mm to a maximum of and nickel–graphite, tin–nickel layer 1.0 electrolytically plated on the top side of ≥ including 250.00 mm in overall width, micrometers; tin layer only 0.05 the nickel plated steel strip; with the with a low carbon steel back comprised micrometers, nickel–graphite layer only nickel–phosphorous, nickel plated of: carbon under 0.10%, manganese > 0.2 micrometers, and bottom side: material sufficiently ductile and ≥ under 0.40%, phosphorous under nickel layer 1.0 micrometers; (b) adherent to the substrate to permit 0.04%, sulfur under 0.05%, and silicon nickel–graphite, diffusion–annealed, forming without cracking, flaking, under 0.05%; clad with aluminum alloy nickel plated carbon products, having a peeling or any other evidence of comprised of: under 2.51% copper, natural composition mixture of nickel separation; having a coating thickness: under 15.10% tin, and remainder and graphite electrolytically plated to top side: nickel–phosphorous, nickel aluminum as listed on the mill the top side of diffusion–annealed layer ≥ 1.0 micrometers; nickel– specification sheet. See Certain nickel plated steel strip with a cold phosphorous layer ≥ 0.1 micrometers; Corrosion–Resistant Carbon Steel Flat rolled or tin mill black plate base metal bottom side: nickel layer ≥ 1.0 Products From Japan: Notice of Final conforming to chemical requirements micrometers; (e) diffusion–annealed, Results of Changed Circumstances based on AISI 1006; with both sides of tin–nickel plated products, Review, and Revocation in Part of the cold rolled base metal initially electrolytically plated with natural Antidumping Duty Order, 67 FR 7356 electrolytically plated with natural nickel to the top side of a diffusion– (Feb. 19, 2002). nickel, and the material then annealed annealed tin–nickel plated cold rolled Also excluded from this order are to create a diffusion between the nickel or tin mill black plate base metal products meeting the following and the iron substrate; with an conforming to the chemical specifications: (1) Diffusion–annealed, additional layer of natural nickel– requirements based on AISI 1006; with non–alloy nickel–plated carbon graphite then electrolytically plated on both sides of the cold rolled strip products, with a substrate of cold–rolled the top side of the strip of the nickel initially electrolytically plated with battery grade sheet (‘‘CRBG’’) with both plated steel strip; with the nickel– natural nickel, with the top side of the sides of the CRBG initially graphite, nickel plated material nickel plated strip electrolytically electrolytically plated with pure, sufficiently ductile and adherent to the plated with tin and then annealed to unalloyed nickel and subsequently substrate to permit forming without create a diffusion between the nickel annealed to create a diffusion between cracking, flaking, peeling, or any other and tin layers in which a nickel–tin

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alloy is created, and an additional layer 7210.49.00), other than of high–strength pure nickel and a surface coating layer of natural nickel then electrolytically steel, known as ‘‘ASE Iron Flash’’ and of hard, luster–agent-added nickel plated on the top side of the strip of the either: (A) having a base layer of zinc– which is not heat–treated; with nickel–tin alloy; sufficiently ductile and based zinc–iron alloy applied by hot– combined coating thickness for all three adherent to the substrate to permit dipping and a surface layer of iron–zinc layers of more than 2 micrometers; forming without cracking, flaking, alloy applied by electrolytic process, the surface roughness (RA–microns) 0.18 or peeling or any other evidence of weight of the coating and plating not less; with SEM not revealing oxides separation; having coating thickness: over 40% by weight of zinc; or (B) two– greater than 1 micron; and inclusion top side: nickel–tin-nickel combination layer-coated corrosion–resistant steel groups or clusters shall not exceed 5 layer ≥ 1.0 micrometers; tin layer only with a coating composed of (a) a base microns in length; or (D) products ≥ 0.05 micrometers; bottom side: nickel coating layer of zinc–based zinc–iron having one side coated with a nickel– layer ≥ 1.0 micrometers; and (f) tin mill alloy by hot–dip galvanizing process, iron-diffused layer which is less than 1 products for battery containers, tin and and (b) a surface coating layer of iron– micrometer in thickness and the other nickel plated on a cold rolled or tin mill zinc alloy by electro–galvanizing side coated with a three–layer coating black plate base metal conforming to process, having an effective amount of composed of a base nickel–iron-diffused chemical requirements based on AISI zinc up to 40% by weight, and (2) coating layer, with a middle coating 1006; having both sides of the cold corrosion resistant continuously layer of annealed and softened pure rolled substrate electrolytically plated annealed flat–rolled products, nickel and a surface coating layer of with natural nickel; then annealed to continuous cast, the foregoing with hard, pure nickel which is not heat– create a diffusion of the nickel and iron chemical composition (percent by treated; with combined coating substrate; then an additional layer of weight): carbon not over 0.06% by thickness for all three layers of more natural tin electrolytically plated on the weight, manganese 0.20 or more but not than 2 micrometers; surface roughness top side; and again annealed to create a over 0.40, phosphorus not over 0.02, (RA–microns) 0.18 or less; SEM not diffusion of the tin and nickel alloys; sulfur not over 0.023, silicon not over revealing oxides greater than 1 micron; with the tin–nickel, nickel plated 0.03, aluminum 0.03 or more but not and inclusion groups or clusters shall not exceed 5 microns in length. See material sufficiently ductile and over 0.08, arsenic not over 0.02, copper adherent to the substrate to permit Certain Corrosion–Resistant Carbon not over 0.08 and nitrogen 0.003 or forming without cracking, flaking, Steel Flat Products From Japan: Notice more but not over 0.008; and meeting peeling or any other evidence of of Final Results of Changed the characteristics described below: (A) separation; having a coating thickness: Circumstances Review, and Revocation Products with one side coated with a top side: nickel–tin layer ≥1 micrometer; in Part of Antidumping Duty Order, 68 nickel–iron-diffused layer which is less tin layer alone ≥0.05 micrometers; FR 19970 (Apr. 23, 2003). than 1 micrometer in thickness and the bottom side: nickel layer ≥1.0 Also excluded from the scope of this other side coated with a two–layer micrometer. See Certain Corrosion– order is merchandise meeting the coating composed of a base nickel–iron- Resistant Carbon Steel Flat Products following specifications: (1) Base metal: diffused coating layer and a surface From Japan: Notice of Final Results of Aluminum Killed, Continuous Cast, Changed Circumstances Review, and coating layer of annealed and softened Carbon Steel SAE 1008, (2) Chemical Revocation in Part of Antidumping Duty pure nickel, with total coating thickness Composition: Carbon 0.08% max, Order, 67 FR 47768 (Jul. 22, 2002). for both layers of more than 2 Silicon, 0.03% max., Manganese 0.40% Also excluded from this order are micrometers; surface roughness (RA– max., Phosphorus, 0.020% max., Sulfur products meeting the following microns) 0.18 or less; with scanning 0.020% max., (3) Nominal thickness of specifications: (1) Widths ranging from electron microscope (SEM) not revealing 0.054 mm, (4) Thickness tolerance 10 mm (0.394 inches) through 100 mm oxides greater than 1 micron; and minimum 0.0513 mm, maximum 0.0567 (3.94 inches); (2) thicknesses, including inclusion groups or clusters shall not mm, (5) Width of 600 mm or greater, coatings, ranging from 0.11 mm (0.004 exceed 5 microns in length; (B) products and (7) Nickel plate min. 2.45 microns inches) through 0.60 mm (0.024 inches); having one side coated with a nickel– per side. See Notice of Final Results of and (3) a coating that is from 0.003 mm iron-diffused layer which is less than 1 Antidumping Duty Changed (0.00012 inches) through 0.005 mm micrometer in thickness and the other Circumstances Review and Revocation, (0.000196 inches) in thickness and that side coated with a four–layer coating In Part: Certain Corrosion–Resistant is comprised of either two evenly composed of a base nickel–iron-diffused Carbon Steel Flat Products From Japan, applied layers, the first layer consisting coating layer; with an inner middle 70 FR 2608 (Jan. 14, 2005). of 99% zinc, 0.5% cobalt, and 0.5% coating layer of annealed and softened Also excluded from the scope of this molybdenum, followed by a layer pure nickel, an outer middle surface order are the following 24 separate consisting of phosphate, or three evenly coating layer of hard nickel and a corrosion–resistant carbon steel coil applied layers, the first layer consisting topmost nickel–phosphorus-plated products meeting the following of 99% zinc, 0.5% cobalt, and 0.5% layer; with combined coating thickness specifications: molybdenum followed by a layer for the four layers of more than 2 Product 1 Products described in consisting of phosphate, and finally a micrometers; surface roughness (RA– industry usage as of carbon steel, layer consisting of silicate. See Certain microns) 0.18 or less; with SEM not measuring 1.625 mm to 1.655 mm in Corrosion–Resistant Carbon Steel Flat revealing oxides greater than 1 micron; thickness and 19.3 mm to 19.7 mm in Products From Japan: Notice of Final and inclusion groups or clusters shall width, consisting of carbon steel coil Results of Changed Circumstances not exceed 5 microns in length; (C) (SAE 1010) with a lining clad with an Review, and Revocation in Part of products having one side coated with a aluminum alloy containing by weight Antidumping Duty Order, 67 FR 57208 nickel–iron-diffused layer which is less 10% or more but not more than 15% of (Sept. 9, 2002). than 1 micrometer in thickness and the tin, 1% or more but not more than 3% Also excluded from this order are other side coated with a three–layer of lead, 0.7% or more but not more than products meeting the following coating composed of a base nickel–iron- 1.3% of copper, 1.8% or more but not specifications: (1) Flat–rolled products diffused coating layer, with a middle more than 3.5% of silicon, 0.1% or more (provided for in HTSUS subheading coating layer of annealed and softened but not more than 0.7% of chromium

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and less than or equal to 1% of other tin, 9% or more but not more than 11% (percent by weight): tin 9 to 11, lead 9 materials, and meeting the requirements of lead, less than 1% of zinc and less to 11, phosphorus less than 0.05, ferrous of SAE standard 788 for Bearing and than or equal to 1% in the aggregate of group less than 0.35 and other materials Bushing Alloys. other materials and meeting the less than 1; meeting the requirements of Product 2 Products described in requirements of SAE standard 797 for SAE standard 797 for bearing and industry usage as of carbon steel, Bearing and Bushing Alloys, with the bushing alloys; the second layer measuring 0.955 mm to 0.985 mm in second layer consisting by weight of consisting of (percent by weight) carbon thickness and 8.6 mm to 9.0 mm in 45% or more but not more than 55% of 13 to 17 and aromatic polyester 13 to 17, width, consisting of carbon steel coil lead, 3% or more but not more than 5% with a balance of PTFE. (SAE 1012) clad with a two–layer lining, of molybdenum disulfide and with the Product 10 Products described in the first layer consisting of a copper– remainder made up of PTFE industry usage as of carbon steel, lead alloy powder that contains by (approximately 38% to 52%) and up to measuring 0.955 mm to 0.985 mm in weight 9% or more but not more than 2% in the aggregate of other materials. thickness and 13.6 mm to 14 mm in 11% of tin, 9% or more but not more Product 6 Products described in width; base of SAE 1012 steel with a than 11% of lead, less than 0.05% industry usage as of carbon steel, two–layer lining, the first layer phosphorus, less than 0.35% iron and measuring 0.96 mm to 0.98 mm in consisting of copper–based alloy less than or equal to 1% other materials, thickness and 18.75 mm to 18.95 mm in powder with chemical composition and meeting the requirements of SAE width; base of SAE 1010 steel with a (percent by weight): tin 9 to 11, lead 9 standard 797 for Bearing and Bushing two–layer lining, the first layer to 11, phosphorus less than 0.05, ferrous Alloys, with the second layer containing consisting of copper–base alloy powder group less than 0.35 and other materials by weight 13% or more but not more with chemical composition (percent by less than 1; meeting the requirements of than 17% of carbon, 13% or more but weight): tin 9 to 11, lead 9 to 11, SAE standard 797 for bearing and not more than 17% of aromatic phosphorus less than 0.05, ferrous bushing alloys; the second layer polyester, and the remainder (approx. group less than 0.35, and other materials consisting of (percent by weight) carbon 66–74%) of PTFE. less than 1%; meeting the requirements 13 to 17, aromatic polyester 13 to 17, Product 3 Products described in of SAE standard 797 for bearing and with a balance (approximately 66 to 74) industry usage as of carbon steel, bushing alloys; the second layer of PTFE. measuring 1.01 mm to 1.03 mm in consisting of lead 33 to 37%, aromatic Product 11 Products described in thickness and 10.5 mm to 10.9 mm in polyester 28 to 32%, and other materials industry usage as of carbon steel, width, consisting of carbon steel coil less than 2% with a balance of PTFE. measuring 1.2 mm to 1.24 mm in (SAE 1010) with a two–layer lining, the Product 7 Products described in thickness; 20 mm to 20.4 mm in width; first layer consisting of a copper–lead industry usage as of carbon steel, consisting of carbon steel coils (SAE alloy powder that contains by weight measuring 1.21 mm to 1.25 mm in 1012) with a lining of sintered 9% or more but not more than 11% of thickness and 19.4 mm to 19.6 mm in phosphorus bronze alloy with chemical tin, 9% or more but not more than 11% width; base of SAE 1012 steel with composition (percent by weight): tin 5.5 of lead, less than 1% zinc and less than lining of copper base alloy with to 7; phosphorus 0.03 to 0.35; lead less or equal to 1% other materials, and chemical composition (percent by than 1 and other non–copper materials meeting the requirements of SAE weight): tin 9 to 11, lead 9 to 11, less than 1. standard 797 for Bearing and Bushing phosphorus less than 0.05, ferrous Product 12 Products described in Alloys, with the second layer containing group less than 0.35 and other materials industry usage as of carbon steel, by weight 45% or more but not more less than 1%; meeting the requirements measuring 1.8 mm to 1.88 mm in than 55% of lead, 3% or more but not of SAE standard 797 for bearing and thickness and 43.3 mm to 43.7 mm in more than 5% of molybdenum bushing alloys. width; base of SAE 1010 steel with a disulfide, and the remainder made up of Product 8 Products described in lining of aluminum based alloy with PTFE (approximately 38% to 52%) and industry usage as of carbon steel, chemical composition (percent by less than 2% in the aggregate of other measuring 0.96 mm to 0.98 mm in weight: tin 10 to 15, lead 1 to 3, copper materials. thickness and 21.5 mm to 21.7 mm in 0.7 to 1.3, silicon 1.8 to 3.5, chromium Product 4 Products described in width; base of SAE 1010 steel with a 0.1 to 0.7 and other materials less than industry usage as of carbon steel, two–layer lining, the first layer 1; meeting the requirements of SAE measuring 1.8 mm to 1.88 mm in consisting of copper–base alloy powder standard 788 for bearing and bushing thickness and 43.4 mm to 43.8 mm or with chemical composition (percent by alloys. 16.1 mm to 1.65 mm in width, weight): tin 9 to 11, lead 9 to 11, Product 13 Products described in consisting of carbon steel coil (SAE phosphorus less than 0.05%, ferrous industry usage as of carbon steel, 1010) clad with an aluminum alloy that group less than 0.35 and other materials measuring 1.8 mm to 1.88 mm in contains by weight 19% to 20% tin, 1% less than 1; meeting the requirements of thickness and 24.2 mm to 24.6 mm in to 1.2% copper, less than 0.3% silicon, SAE standard 797 for bearing and width; base of SAE 1010 steel with a 0.15% nickel and less than 1% in the bushing alloys; the second layer lining of aluminum alloy with chemical aggregate other materials and meeting consisting of (percent by weight) lead 33 composition (percent by weight): tin 10 the requirements of SAE standard 783 to 37, aromatic polyester 28 to 32 and to 15, lead 1 to 3, copper 0.7 to 1.3, for Bearing and Bushing Alloys. other materials less than 2 with a silicon 1.8 to 3.5, chromium 0.1 to 0.7 Product 5 Products described in balance of PTFE. and other materials less than 1; meeting industry usage as of carbon steel, Product 9 Products described in the requirements of SAE standard 788 measuring 0.95 mm to 0.98 mm in industry usage as of carbon steel, for bearing and bushing alloys. thickness and 19.95 mm to 20 mm in measuring 0.96 mm to 0.99 mm in Product 14 Flat–rolled coated SAE width, consisting of carbon steel coil thickness and 7.65 mm to 7.85 mm in 1009 steel in coils, with thickness not (SAE 1010) with a two–layer lining, the width; base of SAE 1012 steel with a less than 0.915 mm but not over 0.965 first layer consisting of a copper–lead two–layer lining, the first layer mm, width not less than 19.75 mm or alloy powder that contains by weight consisting of copper–based alloy more but not over 20.35 mm; with a 9% or more but not more than 11% of powder with chemical composition two–layer coating; the first layer

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consisting of tin 9 to 11%, lead 9 to 2.3 to 4.2%, lead 20 to 25%, iron 1.5 to Final Results of Review 11%, zinc less than 1%, other materials 4.5%, phosphorus 0.2 to 2.0%, other (other than copper) not over 1% and materials (other than copper) less than The Department determines that balance copper; the second layer 1%, with a balance copper. revocation of the AD orders on CORE consisting of lead 45 to 55%, Product 21 Flat–rolled coated SAE from Australia, Canada, France, molybdenum disulfide (MoS2) 3 to 5%, 1009 steel in coils with thickness 1.59 Germany, Japan, and South Korea other materials not over 2%, balance mm or more but not over 1.64 mm; would be likely to lead to continuation PTFE. width 11.5 mm or more but not over or recurrence of dumping at the Product 15 Flat–rolled coated SAE 12.1 mm; with a lining consisting of tin following weighted–average percentage 1009 steel in coils with thickness not 2.3 to 4.2%, lead 20 to 25%, iron 1.5 to margins: less than 0.915 mm or more but not over 4.5%, phosphorus 0.2 to 2.0%, other 0.965 mm; width not less than 18.65 materials (other than copper) less than Australia. mm or more but not over19.25 mm; with 1%, balance copper. Broken Hill Proprietary Company a two–layer coating; the first layer Product 22 Flat–rolled coated SAE Ltd. (‘‘BHP’’) ...... 24.96% consisting of tin 9 to 11%, lead 9 to 1009 steel in coils with thickness 1.59 All Others ...... 24.96% 11%, zinc less than 1%, other materials mm or more but not over 1.64 mm; Canada. (other than copper) not over 1%, width 11.2 mm or more but not over Dofasco, Inc...... 11.71% balance copper; the second layer 11.8 mm, with a lining consisting of Stelco, Inc...... 22.70% consisting of lead 33 to 37%, aromatic copper 0.7 to 1.3%, tin 17.5 to 22.5%, All Others ...... 18.71% polyester 13 to 17%, other materials silicon less than 0.3%, nickel less than France. other than PTFE less than 2%, balance 0.15%, other materials less than 1%, Usinor Sacilor ...... 29.41% PTFE. balance aluminum. All Others ...... 29.41% Product 16 Flat–rolled coated SAE Product 23 Flat–rolled coated SAE Germany. 1009 steel in coils with thickness not Thyssen Stahl AG (‘‘Thyssen’’) ...... 10.02% 1009 steel in coils with thickness 1.59 less than 0.920 mm or more but not over All Others ...... 10.02% mm or more but not over 1.64 mm; 0.970 mm; width not less than 21.35 Japan. width 7.2 mm or more but not over 7.8 mm or more but not over 21.95 mm; Kawasaki Steel Corporation (‘‘KSC’’) 36.41% mm; with a lining consisting of copper with a two–layer coating; the first layer Nippon Steel Corporation (‘‘NSC’’) ... 36.41% consisting of tin 9 to 11%, lead 9 to 0.7 to 1.3%, tin 17.5 to 22.5%, silicon All Others ...... 36.41% 11%, zinc less than 1%, other materials less than 0.3%, nickel less than 0.15%, South Korea. (other than copper) not over 1%, other materials (other than copper) less Pohang Iron and Steel Company, balance copper; the second layer than 1%, balance copper. Ltd...... 17.70% consisting of lead 33 to 37%, aromatic Product 24 Flat–rolled coated SAE All Others ...... 17.70% polyester 13 to 17%, other materials 1009 steel in coils with thickness 1.72 (other than PTFE) less than 2%, balance mm or more but not over 1.77 mm; Notification Regarding Administrative PTFE. width 7.7 mm or more but not over 8.3 Protective Order Product 17 Flat–rolled coated SAE mm; with a lining consisting of copper 1009 steel in coils with thickness not 0.7 to 1.3%, tin 17.5 to 22.5%, silicon This notice serves as the only less than 1.80 mm or more but not over less than 0.3%, nickel less than 0.15%, reminder to parties subject to 1.85 mm, width not less than 14.7 mm other materials (other than copper) less administrative protective order (‘‘APO’’) or more but not over 15.3 mm; with a than 1%, balance copper. See Notice of of their responsibility concerning the lining consisting of tin 2.5 to 4.5%, lead Final Results of Antidumping Duty return or destruction of proprietary 21.0 to 25.0%, zinc less than 3%, iron Changed Circumstances Review and information disclosed under APO in less than 0.35%, other materials (other Revocation, in Part: Certain Corrosion– accordance with 19 CFR 351.305. than copper) less than 1%, balance Resistant Carbon Steel Flat Products Timely notification of return/ From Japan, 70 FR 5137 (Feb. 1, 2005). copper. destruction of APO materials or Product 18 Flat–rolled coated SAE Analysis of Comments Received conversion to judicial protective order is 1009 steel in coils with thickness 1.59 hereby requested. Failure to comply mm or more but not over 1.64 mm; All issues raised in these reviews are with the regulations and the terms of an width 14.5 mm or more but not over addressed in the Issues and Decision APO is a sanctionable violation. 15.1 mm; with a lining consisting of tin Memorandum (‘‘Decision 2.3 to 4.2%, lead 20 to 25%, iron 1.5 to Memorandum’’) from Stephen J. Claeys, We are issuing and publishing the 4.5%, phosphorus 0.2 to 2.0%, other Deputy Assistant Secretary for Import results and notice in accordance with materials (other than copper) less than Administration, to David M. Spooner, sections 751(c), 752, and 777(i)(1) of the 1%, balance copper. Assistant Secretary for Import Act. Administration, dated May 30, 2006, Product 19 Flat–rolled coated SAE Dated: May 30, 2006. 1009 steel in coils with thickness not which is hereby adopted by this notice. less than 1.75 mm or more but not over Parties can find a complete discussion David M. Spooner, 1.8 mm; width not less than 18.0 mm or of all issues raised in these reviews and Assistant Secretary for Import more but not over 18.6 mm; with a the corresponding recommendations in Administration. lining consisting of tin 2.3 to 4.2%, lead this public memorandum which is on [FR Doc. E6–8760 Filed 6–5–06; 8:45 am] 20 to 25%, iron 1.5 to 4.5%, phosphorus file in the Central Records Unit room B– BILLING CODE 3510–DS–S 0.2 to 2.0%, other materials (other than 099 of the main Commerce building. In copper) less than 1%, balance copper. addition, a complete version of the Product 20 Flat–rolled coated SAE Decision Memorandum can be accessed 1009 steel in coils with thickness 1.59 directly on the Web at http:// mm or more but not over 1.64 mm; ia.ita.doc.gov/frn. The paper copy and width 13.6 mm or more but not over electronic version of the Decision 14.2 mm; with a lining consisting of tin Memorandum are identical in content.

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DEPARTMENT OF COMMERCE Department published a notice initiating less than normal value (‘‘NV’’), we the review for FET. See Initiation of compared export price (‘‘EP’’) to NV, as International Trade Administration Antidumping and Countervailing Duty described in the ‘‘Export Price’’ and [A–583–833] Administrative Reviews, 70 FR 37749, ‘‘Normal Value’’ sections of this notice. 37756 (June 30, 2005). The period of Pursuant to section 777A(d)(2) of the Certain Polyester Staple Fiber From review (‘‘POR’’) is May 1, 2004, through Tariff Act of 1930, as amended (‘‘the Taiwan: Preliminary Results of April 30, 2005. Act’’), we compared the EP of Antidumping Duty Administrative On July 6, 2005, we issued an individual U.S. transactions to the Review antidumping questionnaire to FET. We weighted-average NV of the foreign like received questionnaire responses from product, where there were sales made in AGENCY: Import Administration, FET on August 5, 2005, and August 30, the ordinary course of trade, as International Trade Administration, 2005. In October, November, and discussed in the ‘‘Cost of Production Department of Commerce. December 2005, and March and April Analysis’’ section, below. 2006, we issued supplemental SUMMARY: The Department of Commerce Product Comparisons is conducting an administrative review questionnaires to FET. We received of the antidumping duty order on responses to these supplemental In accordance with section 771(16) of certain polyester staple fiber from questionnaires in November and the Act, we considered all products Taiwan. The period of review is May 1, December 2005, and January, April and produced and sold by the respondent in 2004, through April 30, 2005. This May 2006. In February 2006, we the home market covered by the review covers imports of certain requested FET to revise its reported description in the ‘‘Scope of the Order’’ polyester staple fiber from one model matching characteristics, as section, above, to be foreign like producer/exporter. We have described in the ‘‘Product Comparisons’’ products for purposes of determining preliminarily found that sales of the section, below. We received FET’s appropriate product comparisons to subject merchandise have been made response in February 2006. U.S. sales. In accordance with sections 773(a)(1)(B) and (C) of the Act, in order below normal value. If these Scope of the Order preliminary results are adopted in our to determine whether there was a final results, we will instruct U.S. For the purposes of this order, the sufficient volume of sales in the home Customs and Border Protection to assess product covered is PSF. PSF is defined market to serve as a viable basis for antidumping duties. Interested parties as synthetic staple fibers, not carded, calculating NV, we compared the respondent’s volume of home market are invited to comment on these combed or otherwise processed for sales of the foreign like product to the preliminary results. We will issue the spinning, of polyesters measuring 3.3 volume of its U.S. sales of the subject final results not later than 120 days from decitex (3 denier, inclusive) or more in merchandise. (For further details, see the date of publication of this notice. diameter. This merchandise is cut to lengths varying from one inch (25 mm) the ‘‘Normal Value’’ section, below.) DATES: Effective Date: June 6, 2006. to five inches (127 mm). The We compared U.S. sales to monthly FOR FURTHER INFORMATION CONTACT: merchandise subject to this order may weighted-average prices of Andrew McAllister or Devta Ohri, AD/ be coated, usually with a silicon or contemporaneous sales made in the CVD Operations, Office 1, Import other finish, or not coated. PSF is home market. Where there were no Administration, International Trade generally used as stuffing in sleeping contemporaneous sales of identical Administration, U.S. Department of bags, mattresses, ski jackets, comforters, merchandise in the home market, we Commerce, 14th Street and Constitution cushions, pillows, and furniture. compared sales made within the Avenue, NW., Washington DC 20230; Merchandise of less than 3.3 decitex window period, which extends from telephone (202) 482–1174 and (202) (less than 3 denier) currently classifiable three months prior to the POR until two 482–3853, respectively. in the Harmonized Tariff Schedule of months after the POR. As directed by Background the United States (‘‘HTSUS’’) at section 771(16) of the Act, where there subheading 5503.20.00.20 is specifically were no sales of identical merchandise On May 25, 2000, the Department of excluded from this order. Also in the home market made in the Commerce (‘‘Department’’) published an specifically excluded from this order are ordinary course of trade to compare to antidumping duty order on certain polyester staple fibers of 10 to 18 denier U.S. sales, we compared U.S. sales to polyester staple fiber (‘‘PSF’’) from that are cut to lengths of 6 to 8 inches sales of the most similar foreign like Taiwan. See Notice of Amended Final (fibers used in the manufacture of product made in the ordinary course of Determination of Sales at Less Than carpeting). In addition, low-melt PSF is trade. Fair Value: Certain Polyester Staple excluded from this order. Low-melt PSF Further, as provided in section Fiber From the Republic of Korea and is defined as a bi-component fiber with 773(a)(4) of the Act, where we could not Antidumping Duty Orders: Certain an outer sheath that melts at a determine NV because there were no Polyester Staple Fiber From the significantly lower temperature than its sales of identical or similar merchandise Republic of Korea and Taiwan, 65 FR inner core. made in the ordinary course of trade in 33807 (May 25, 2000) (‘‘PSF Orders’’). The merchandise subject to this order the home market to compare to U.S. On May 2, 2005, the Department is currently classifiable in the HTSUS at sales, we compared U.S. sales to published a notice of ‘‘Opportunity to subheadings 5503.20.00.45 and constructed value (‘‘CV’’). Request Administrative Review’’ of this 5503.20.00.65. Although the HTSUS During the investigation and this order. See Antidumping or subheadings are provided for administrative review, classification of Countervailing Duty Order, Finding, or convenience and customs purposes, the PSF products with certain physical Suspended Investigation; Opportunity written description of the merchandise characteristics within the model to Request Administrative Review, 70 under order is dispositive. matching hierarchy has been highly FR 22631 (May 2, 2005). On May 31, contentious. See, e.g., Notice of Final 2005, Far Eastern Textile Limited Fair Value Comparisons Determination of Sales at Less Than (‘‘FET’’) requested an administrative To determine whether FET’s sales of Fair Value: Certain Polyester Staple review. On June 30, 2005, the PSF to the United States were made at Fiber from Taiwan (‘‘LTFV

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Investigation: PSF from Taiwan’’), 65 FR Antidumping Duty Administrative freight—plant to port of exportation, 16877 (March 30, 2000), and Review, 70 FR 6837 (February 9, 2005), brokerage and handling, harbor service accompanying Issues and Decision and accompanying Issues and Decisions fee, trade promotion fee, international Memorandum at Comments 4, 5, and 15. Memorandum at Comment 1 (‘‘It is freight, and marine insurance. appropriate to consider changes when In this review, the Department received Normal Value new information in FET’s supplemental additional expertise and knowledge questionnaire response regarding the with regard to the market demands and A. Selection of Comparison Market physical characteristics of certain PSF market realities of the products subject To determine whether there was a products. See December 28, 2005, to the scope indicate that such changes sufficient volume of sales of PSF in the Supplemental Questionnaire Response, allow more accurate comparison of U.S. home market to serve as a viable basis Appendix SS–3. These events led the and normal value products.’’). for calculating NV, we compared the Department to reconsider whether the Therefore, to account for the new respondent’s home market sales of the product matching characteristics information regarding physical foreign like product to its volume of established in the investigation characteristics of PSF and to increase U.S. sales of the subject merchandise, in accurately reflect the physical product matching accuracy, the accordance with section 773(a) of the characteristics of the PSF products Department has preliminarily modified Act. Pursuant to sections 773(a)(1)(B) under review. For this administrative the matching criteria that were and (C) of the Act, because the review and the concurrent established in the original investigation. respondent’s aggregate volume of home administrative review of PSF from the Accordingly, for the preliminary results, market sales of the foreign like product Republic of Korea (A–580–839), the we matched the merchandise under was greater than five percent of its Department requested comments review based on the physical aggregate volume of U.S. sales of the regarding the adequacy of the model characteristics reported by the subject merchandise, we determined match criteria to reflect the physical respondent in the following order: loft, that the home market was viable for characteristics of the merchandise under specialty fibers, type, grade, cross comparison. review. See Letter from Julie H. section, finish, and denier. See Letter Santoboni to Interested Parties, 2004– from Julie H. Santoboni to FET, 2004– B. Level of Trade 2005 Administrative Reviews of the 2005 Administrative Reviews of the Section 773(a)(1)(B)(i) of the Act Antidumping Duty Orders on Certain Antidumping Duty Orders on Certain states that, to the extent practicable, the Polyester Staple Fiber from Korea and Polyester Staple Fiber from Korea and Department will calculate NV based on Taiwan, dated November 9, 2005, which Taiwan, dated February 2, 2006, which sales at the same level of trade (‘‘LOT’’) is on file in the Central Records Unit is on file in the Department’s CRU. as the EP. Sales are made at different (‘‘CRU’’) in room B–099 of the main Date of Sale LOTs if they are made at different Department building; see also marketing stages (or their equivalent). In its questionnaire responses, FET Memorandum to File: Modifications to See 19 CFR 351.412(c)(2). Substantial reported invoice date as the date of sale the Department’s November 9, 2005 differences in selling activities are a for its home market and U.S. sales. FET letter to Interested Parties, dated necessary, but not sufficient, condition has stated that it permits home market November 10, 2005. On November 16, for determining that there is a difference and U.S. customers to make order in the stages of marketing. See 19 CFR 2005, we received comments from changes up to the date of shipment. Wellman, Inc. and Invista, S.a.r.l. 351.412(c)(2); see also Notice of Final According to FET’s descriptions, the Determination of Sales at Less Than (collectively, ‘‘the petitioners’’), Huvis sales processes in the home market and Corporation (‘‘Huvis’’), and FET. On Fair Value: Certain Cut-to-Length to the United States are identical. Thus, Carbon Steel Plate From South Africa, November 28, 2005, we received record evidence demonstrates that FET’s rebuttal comments from Dongwoo 62 FR 61731, 61732 (November 19, invoices establish the material terms of 1997). In order to determine whether the Industry Company, the petitioners, FET, sale. See 19 CFR 351.401(i). However, Consolidated Fibers, Inc., and Huvis. On comparison market sales were made at because the merchandise is always different stages in the marketing process December 8, 2005, we received shipped on or before the date of invoice, additional rebuttal comments from FET. than the U.S. sales, we reviewed the we are using the date of shipment as the distribution system in each market (i.e., The comments we received and the date of sale. See Certain Cold-Rolled the ‘‘chain of distribution’’),1 including facts and information on the record of and Corrosion-Resistant Carbon Steel selling functions,2 class of customer this review lead us to preliminarily Flat Products From Korea: Final Results (‘‘customer category’’), and the level of conclude that relying on the model of Antidumping Duty Administrative selling expenses for each type of sale. matching criteria established in the Reviews, 63 FR 13170, 13172–73 (March Pursuant to section 773(a)(1)(B)(i) of LTFV Investigation: PSF from Taiwan 18, 1998). For sales to the United States, the Act, in identifying levels of trade for does not provide the best product we calculated EP, in accordance with comparisons because the criteria do not section 772(a) of the Act, because the 1 The marketing process in the United States and adequately reflect the physical merchandise was sold prior to comparison markets begins with the producer and differences exhibited by specialty PSF importation by the exporter or producer extends to the sale to the final user or customer. products. See Notice of Preliminary The chain of distribution between the two may have outside the United States to the first many or few links, and the respondent’s sales occur Determination of Sales at Not Less Than unaffiliated purchaser in the United somewhere along this chain. In performing this Fair Value and Preliminary Negative States, and because constructed export evaluation, we considered the narrative responses Critical Circumstances Determination: price methodology was not otherwise of the respondent to properly determine where in Certain Polyester Staple Fiber From warranted. We calculated EP based on the chain of distribution the sale appears to occur. 2 Selling functions associated with a particular Taiwan, 64 FR 60771, 60772 (November the cost, insurance and freight (‘‘CIF’’) chain of distribution help us to evaluate the level(s) 8, 1999); LTFV Investigation: PSF from price to unaffiliated purchasers in the of trade in a particular market. For purposes of Taiwan, and accompanying Issues and United States. Where appropriate, we these preliminary results, we have organized the Decision Memorandum at Comments 4, made deductions, consistent with common selling functions into four major categories: sales process and marketing support, 5, and 15; Structural Steel Beams from section 772(c)(2)(A) of the Act, for the freight and delivery, inventory and warehousing, Korea; Notice of Final Results of following movement expenses: inland and quality assurance/warranty services.

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EP and comparison market sales (i.e., foreign like product packed and in a 773(b) of the Act, to determine whether NV based on either home market or condition ready for shipment, in these sales were made at prices below third country prices),3 we consider the accordance with section 773(b)(3) of the the COP. The prices were exclusive of starting prices before any adjustments. Act. any applicable movement charges and See Micron Technology, Inc. v. United We relied on COP information indirect selling expenses. In States, et al., 243 F.3d 1301, 1314–1315 submitted in FET’s cost questionnaire determining whether to disregard home (Fed. Cir. 2001) (affirming this responses, except for the following market sales made at prices less than methodology). adjustments: their COP, we examined, in accordance When the Department is unable to We adjusted FET’s reported cost of with sections 773(b)(1)(A) and (B) of the match U.S. sales to sales of the foreign manufacturing to account for purchases Act, whether such sales were made (1) like product in the comparison market of purified terephthalic acid (‘‘TPA’’) within an extended period of time in at the same LOT as the EP, the and mono ethylene glycol (‘‘EG’’) from substantial quantities, and (2) at prices Department may compare the U.S. sale affiliated parties at non-arm’s-length which permitted the recovery of all to sales at a different LOT in the prices. See Memorandum from Team to costs within a reasonable period of time. comparison market. In comparing EP the File, Preliminary Results Calculation sales at a different LOT in the Memorandum—Far Eastern Textile 3. Results of COP Test comparison market, where available Limited, dated May 31, 2006 (‘‘FET We found that, for certain products, data show that the difference in LOT Calculation Memorandum’’), which is more than 20 percent of the affects price comparability, we make a on file in the Department’s CRU. respondent’s home market sales were at LOT adjustment under section We noted significant fluctuations in prices less than the COP and, thus, the 773(a)(7)(A) of the Act. the costs of direct materials reported in below-cost sales were made within an FET reported that it made direct sales FET’s cost database due to (1) The extended period of time in substantial to one distributor in the U.S. market and different mix percentages between quantities. In addition, these sales were to end users in the home market. FET virgin and recycled polymer or made at prices that did not permit the has reported a single channel of polyester chips, (2) the efficiency factors recovery of costs within a reasonable distribution and a single level of trade of the various production lines, and (3) period of time. Therefore, we excluded in each market, and has not requested the time of production (reflecting these sales and used the remaining sales a LOT adjustment. We examined the fluctuations in the prices of the inputs, of the same product, as the basis for information reported by FET regarding TPA and EG). See FET’s January 20, determining NV, in accordance with the type and level of selling activities 2006, supplemental questionnaire section 773(b)(1). performed, and customer categories. response, at TS–15 and TS–16. To Specifically, we considered the extent to address the resulting distortions to D. Calculation of Normal Value Based which sales process, freight services, FET’s costs, we adjusted the company’s on Home Market Prices warehouse/inventory maintenance, and reported costs using a weighted-average We relied on FET’s submitted home warranty services varied with respect to direct materials cost by specialty fiber market sales information, except for the the different customer categories (i.e., and fiber type (i.e., one direct materials following adjustments: distributors and end users) across the cost for regular virgin, one for regular We disregarded FET’s reported other markets. Based on our analysis, we blended, one for virgin of each reported discounts because they related to free found a single level of trade in the specialty fiber, and one for blended of samples provided to certain home United States, and a single, identical each reported specialty fiber). See FET market customers during the POR. level of trade in the home market. Thus, Calculation Memorandum. Moreover, FET’s reported other it is unnecessary to make a LOT FET produced PSF differing only in discounts are accounted for in the G&A adjustment for FET in comparing EP grade. The products that differ only in expenses ratio. See FET Calculation and home market prices. grade have identical material inputs and Memorandum. We reclassified FET’s reported C. Cost of Production Analysis undergo the same production process, and, therefore, should theoretically have warranty expenses as discounts. These Because FET had sales below the cost the same cost. However, as reported by expenses are more properly classified as of production that were disregarded in FET, they do not have the same cost. To discounts because they related to the original investigation, there were adjust for this distortion in the reported compensation for a delay in reasonable grounds to believe or suspect costs, we have weight-averaged the costs merchandise delivery. See FET that the respondent made sales of the to obtain an equal cost for each grade of Calculation Memorandum. merchandise under review in its otherwise identical PSF. See FET We reclassified FET’s reported home comparison market at prices below the Calculation Memorandum. market rebates as warranty expenses cost of production (‘‘COP’’) within the In its net interest expenses because these rebates were to satisfy meaning of section 773(b) of the Act. calculation, FET excluded interest claims regarding product quality 1. Calculation of COP expenses related to a consolidated defects. We allocated the total warranty subsidiary involved in financial expenses incurred in the home market We calculated the COP on a product- investments. For the preliminary during the POR across all home market specific basis, based on the sum of the results, we included these expenses sales. See FET Calculation respondent’s costs of materials and because they relate to the consolidated Memorandum. fabrication for the foreign like product, company’s overall interest expenses. FET applied its calculated indirect plus amounts for general and See FET Calculation Memorandum. selling expenses ratio to the control administrative (‘‘G&A’’) expenses, number-specific total cost of interest expenses, and the costs of all 2. Test of Home Market Prices manufacture to obtain the reported per- expenses incidental to placing the On a product-specific basis, we unit home market indirect selling compared the adjusted weighted- expenses. We recalculated the per-unit 3 Where NV is based on CV, we determine the NV average COP figures for the POR to the home market indirect selling expenses LOT based on the LOT of the sales from which we derive selling expenses, general and administrative home market sales of the foreign like by applying the indirect selling expenses, and profit for CV, where possible. product, as required under section expenses ratio to the reported home

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market gross unit price net of discounts. including the results of its analysis of provided by section 751(a)(1) of the Act: See FET Calculation Memorandum. issues raised in any such written briefs (1) The cash deposit rate for the FET reported its U.S. credit expenses or hearing, within 120 days of reviewed company will be the rate based on the New Taiwan Dollar publication of these preliminary results. established in the final results of this denominated gross unit price. Because administrative review (except no cash Assessment Rates FET’s U.S. sales were invoiced in U.S. deposit will be required if its weighted- dollars, we recalculated FET’s U.S. Upon completion of the average margin is de minimis, i.e., less credit expenses by applying the administrative review, the Department than 0.5 percent); (2) for merchandise standard credit formula to FET’s shall determine, and CBP shall assess, exported by manufacturers or exporters reported U.S. dollar denominated gross antidumping duties on all appropriate not covered in this review but covered unit price. See FET Calculation entries. in the original less-than-fair-value Memorandum. FET has indicated that it was not the investigation, the cash deposit rate will We calculated NV based on the price importer of record for any of its sales to continue to be the most recent rate to unaffiliated customers. We deducted the United States during the POR. FET published in the final determination for discounts, where applicable, from the reported the name of its U.S. customer which the manufacturer or exporter gross unit price. We made adjustments as the importer of record for all U.S. received an individual rate; (3) if the for packing expenses in accordance with sales. As such, FET did not report the exporter is not a firm covered in this sections 773(a)(6)(A) and 773(a)(6)(B)(i) entered value for any of its U.S. sales. review or the original investigation, but of the Act. We also made adjustments, Accordingly, we have calculated the manufacturer is, the cash deposit consistent with section 773(a)(6)(B)(ii) importer-specific assessment rates for rate will be the rate established for the of the Act, for inland freight from the the merchandise in question by most recent period for the manufacturer plant to the customer. In addition, we aggregating the dumping margins of the merchandise; and (4) if neither made adjustments for differences in calculated for all U.S. sales to each the exporter nor the manufacturer is a circumstances of sale (‘‘COS’’), in importer and dividing this amount by firm covered in this review, the cash accordance with section 773(a)(6)(C)(iii) the total quantity of those sales. To deposit rate will be 7.31 percent, the of the Act and 19 CFR 351.410. We determine whether the duty assessment ‘‘all others’’ rate established in PSF made COS adjustments, where rates were de minimis, in accordance Orders. with the requirement set forth in 19 CFR appropriate, by deducting direct selling Notification to Importers expenses incurred on home market sales 351.106(c)(2), we calculated importer- (i.e., credit expenses and warranties) specific ad valorem ratios based on the This notice also serves as a and adding U.S. direct selling expenses estimated entered value. preliminary reminder to importers of (i.e., credit expenses and other credit Pursuant to 19 CFR 351.106(c)(2), we their responsibility under 19 CFR expenses). will instruct CBP to liquidate without 351.402(f)(2) to file a certificate regard to antidumping duties any regarding the reimbursement of Preliminary Results of the Review entries for which the assessment rate is antidumping duties prior to liquidation We find that the following dumping de minimis (i.e., less than 0.50 percent). of the relevant entries during this margin exists for the period May 1, The Department will issue appraisement review period. Failure to comply with 2004, through April 30, 2005: instructions directly to CBP. this requirement could result in the The Department clarified its Secretary’s presumption that Weighted- ‘‘automatic assessment’’ regulation on reimbursement of antidumping duties Exporter/manufacturer average May 6, 2003. See Antidumping and occurred and the subsequent assessment margin Countervailing Duty Proceedings: of double antidumping duties. percentage Assessment of Antidumping Duties, 68 We are issuing and publishing these Far Eastern Textile Limited ...... 3.13 FR 23954 (May 6, 2003). This results in accordance with sections clarification will apply to entries of 751(a)(1) and 777(i)(1) of the Act. Public Comment subject merchandise during the period Dated: May 31, 2006. of review produced by the respondent David M. Spooner, Any interested party may request a for which it did not know its hearing within 30 days of publication of Assistant Secretary for Import merchandise was destined for the Administration. this notice. Any hearing, if requested, United States. In such instances, we will [FR Doc. E6–8762 Filed 6–5–06; 8:45 am] will be held 42 days after the instruct CBP to liquidate unreviewed publication of this notice, or the first entries at the all-others rate if there is no BILLING CODE 3510–DS–P workday thereafter. Issues raised in the rate for the intermediate company(ies) hearing will be limited to those raised involved in the transaction. For a full DEPARTMENT OF COMMERCE in the case and rebuttal briefs. Interested discussion of this clarification, see parties may submit case briefs within 30 Antidumping and Countervailing Duty International Trade Administration days of the date of publication of this Proceedings: Assessment of notice. Rebuttal briefs, which must be Antidumping Duties, 68 FR 23954 (May [A–821–802] limited to issues raised in the case 6, 2003). Final Results of Five–Year Sunset briefs, may be filed not later than 35 Review of Suspended Antidumping days after the date of publication of this Cash Deposit Requirements Duty Investigation on Uranium From notice. Parties who submit case briefs or The following deposit requirements the Russian Federation rebuttal briefs in this proceeding are will be effective upon completion of the requested to submit with each argument final results of this administrative AGENCY: Import Administration, (1) a statement of the issue and (2) a review for all shipments of PSF from International Trade Administration, brief summary of the argument with an Taiwan entered, or withdrawn from Department of Commerce. electronic version included. warehouse, for consumption on or after SUMMARY: On July 1, 2005, the The Department will issue the final the publication date of the final results Department of Commerce (‘‘the results of this administrative review, of this administrative review, as Department’’) initiated the second

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sunset review of the Agreement 2844.10.20.55, 2844.10.50, dismantlement of nuclear weapons in Suspending the Antidumping 2844.20.00.10, 2844.20.00.20, Russia. Investigation on Uranium from the 2844.20.00.30, and 2844.20.00.50 of the There were three amendments to the Russian Federation (‘‘Suspension Harmonized Tariff Schedule of the Suspension Agreement on Russian Agreement’’) pursuant to section 751(c) United States (‘‘HTSUS’’).2 In addition, uranium. In particular, the second of the Tariff Act of 1930, as amended the Department preliminarily amendment to the Suspension (‘‘the Act’’). See Notice of Initiation of determined that HEU (uranium enriched Agreement, published on November 4, Five–Year (‘‘Sunset’’) Reviews, 70 FR to 20 percent or greater in the isotope 1996, provided for, among other things, 38101 (July 1, 2005) (‘‘Sunset uranium–235) is not within the scope of the sale in the United States of the Initiation’’). On January 17, 2006, the the investigation. On October 30, 1992, natural uranium feed associated with the Russian LEU derived from HEU and Department determined that it would the Department issued a suspension of included within the scope of the conduct a full sunset review of the the antidumping duty investigation of Suspension Agreement. As a result of Suspension Agreement Russian uranium from Russia and an this review, the Department finds that uranium which has been enriched in a amendment of the preliminary third country prior to importation into revocation of the Suspension Agreement 3 on uranium from the Russian Federation determination. The notice amended the the United States.7 (‘‘Russia’’) would likely lead to scope of the investigation to include On August 6, 1999, USEC, Inc. and its 4 continuation or recurrence of dumping HEU. Imports of uranium ores and subsidiary, United States Enrichment at the levels indicated in the Final concentrates, natural uranium Corporation (collectively, ‘‘USEC’’) Results of Review section of this notice. compounds, and all other forms of requested that the Department issue a EFFECTIVE DATE: June 6, 2006. enriched uranium were classifiable scope ruling to clarify that enriched under HTSUS subheadings 2612.10.00, FOR FURTHER INFORMATION CONTACT: uranium located in Kazakhstan at the Sally Gannon or Aishe Allen, Import 2844.10.20, 2844.20.00, respectively. time of the dissolution of the Soviet Administration, International Trade Imports of natural uranium metal and Union is within the scope of the Russian Administration, U.S. Department of forms of natural uranium other than Suspension Agreement. Respondent Commerce, 14th Street and Constitution compounds were classifiable under interested parties filed an opposition to Avenue, NW., Washington, DC 20230; HTSUS subheadings 2844.10.10 and the scope request on August 27, 1999. telephone: (202) 482–0162, or 482–0172, 2844.10.50.5 That scope request is pending before the Department. respectively. In addition, Section III of the SUPPLEMENTARY INFORMATION: Suspension Agreement provides that Statute and Regulations Scope of the Review uranium ore from Russia that is milled This review is being conducted into U3O8 and/or converted into UF6 in pursuant to sections 751(c) and 752 of According to the June 3, 1992, another country prior to direct and/or the Act. The Department’s procedures preliminary determination, the indirect importation into the United suspended investigation of uranium for the conduct of sunset reviews are set States is considered uranium from forth in Procedures for Conducting Five– from Russia encompassed one class or Russia and is subject to the terms of the kind of merchandise.1 The merchandise year (‘‘Sunset’’) Reviews of Suspension Agreement, regardless of included natural uranium in the form of Antidumping and Countervailing Duty any subsequent modification or uranium ores and concentrates; natural Orders, 63 FR 13516 (March 20, 1998) blending.6 uranium metal and natural uranium In addition, Section M.1 of (‘‘Sunset Regulations’’) and in CFR Part compounds; alloys, dispersions the Suspension Agreement in no way 351 (1999) in general. prevents Russia from selling directly or (including cermets), ceramic products, Background and mixtures containing natural indirectly any or all of the HEU in existence at the time of the signing of On April 3, 2006, the Department of uranium or natural uranium compound; Commerce (‘‘Department’’) published in uranium enriched in U235 and its the agreement and/or LEU produced in Russia from HEU to the Department of the Federal Register a notice of compounds; alloys dispersions preliminary results of the full sunset (including cermets), ceramic products Energy (‘‘DOE’’), its governmental successor, its contractors, or U.S. private review of the Suspension Agreement and mixtures containing uranium pursuant to Section 751(c) of the Tariff enriched in U235 or compounds or parties acting in association with DOE or the USEC and in a manner not Act of 1930, as amended (‘‘the Act’’) (63 uranium enriched in U235; and any FR 16560) (Preliminary Sunset Notice). other forms of uranium within the same inconsistent with the Suspension Agreement between the United States This notice was accompanied by the class or kind. The uranium subject to ‘‘Issues and Decision Memo for the this investigation was provided for and Russia concerning the disposition of HEU resulting from the Sunset Review of the Agreement under subheadings 2612.10.00.00, Suspending the Antidumping 2844.10.10.00, 2844.10.20.10, Investigation on Uranium from the 2844.10.20.25, 2844.10.20.50, 2 See Preliminary Determination of Sales at Less Than Fair Value: Uranium from Kazakhstan, Russian Federation; Preliminary Kyrgyzstan, Russia, Tajikistan, Ukraine and Results,’’ from Joseph A. Spetrini, 1 The Department based its analysis of the Uzbekistan; and Preliminary Determination of Sales comments on class or kind submitted during the Deputy Assistant Secretary for Policy at Not Less Than Fair Value: Uranium from proceeding and determined that the product under and Negotiations, to David M. Spooner, Armenia, Azerbaijan, Byelarus, Georgia, Moldova investigation constitutes a single class or kind of and Turkmenistan, 57 FR 23380, 23381 (June 3, Assistant Secretary for Import merchandise. The Department based its analysis on 1992). Administration, (March 24, 2006), the ‘‘Diversified’’’ criteria (see Diversified Products 3 Corp. v. United States, 6 CIT 1555 (1983); see also See Antidumping; Uranium from Kazakhstan, which can be found at http:// Preliminary Determination of Sales at Less Than Kyrgyszstan, Russia, Tajikistan, Ukraine, and Fair Value: Uranium from Kazakhstan, Kyrgyzstan, Uzbekistan; Suspension of Investigations and 7 See Amendments to the Agreement Suspending Russia, Tajikistan, Ukraine and Uzbekistan; and Amendment of Preliminary Determinations, 57 FR the Antidumping Investigation on Uranium from Preliminary Determination of Sales at Not Less 49220 (October 30, 1992). the Russian Federation, 61 FR 56665 (November 4, Than Fair Value: Uranium from Armenia, 4 See Id. at 49235. 1996). According to the amendment, the latter Azerbaijan, Byelarus, Georgia, Moldova and 5 See Id. modification remained in effect until October 3, Turkmenistan, 57 FR 23380, 23382 (June 3, 1992). 6 See Id. at 49235. 1998.

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ia.ita.doc.gov/frn/summary/russia/E6– Secretary for Policy and Negotiations, to DEPARTMENT OF COMMERCE 4738–1.pdf. In our preliminary results, David M. Spooner, Assistant Secretary we found that revocation of the for Import Administration (May 30, International Trade Administration antidumping duty Suspension 2006) (‘‘Final Results Decision [C–580–818] Agreement on uranium from Russia Memorandum’’), which is adopted by would likely lead to a continuation or this notice. The issues discussed in the Certain Corrosion-Resistant Carbon recurrence of dumping at the weighted– Final Results Decision Memorandum Steel Flat Products From Korea: Final average margin of 115.82 percent for all include the likelihood of continuation Results of Expedited Five-Year producers/exporters from Russia. or recurrence of dumping, scope of the (‘‘Sunset’’) Review of the On April 17, 2006, we received case subject merchandise, and the magnitude Countervailing Duty Order briefs on behalf of Power Resources, Inc. (‘‘PRI’’) and Crow Butte Resources, Inc. of the margins likely to prevail were the AGENCY: Import Administration, (‘‘Crow Butte’’); USEC Inc. and United Suspension Agreement to be terminated. International Trade Administration, States Enrichment Corporation Parties may find a complete discussion Department of Commerce. (collectively, ‘‘USEC’’); the Ad Hoc of all issues raised in this review and SUMMARY: On November 1, 2005, the Utilities Group (‘‘AHUG’’); and AO the corresponding recommendations in Department of Commerce (‘‘the Techsnabexport (‘‘Tenex’’).8 On April this public memorandum which is on Department’’) published in the Federal 24, 2006, we received rebuttal briefs on file in the Central Records Unit, room Register the notice of initiation of the behalf of Power Resources and Crow B–099, of the main Department of second five-year sunset review of the Butte, USEC, and AHUG. On April 26, Commerce building. In addition, a countervailing duty order on certain 2006, USEC requested that the complete version of the Final Results corrosion-resistant carbon steel flat Department reject AHUG’s rebuttal brief Decision Memorandum can be accessed products (CORE) from the Republic of because it contained new information directly on the Web at http:// Korea (‘‘Korea’’), pursuant to section not permissible under the Department’s ia.ita.doc.gov/frn. The paper copy and 751(c) of the Tariff Act of 1930, as regulations. On May 24, 2006, the electronic version of the Final Results amended (‘‘the Act’’). See Initiation of Department notified AHUG that it was Decision Memorandum are identical in Five-Year (‘‘Sunset’’) Reviews, 70 FR returning AHUG’s rebuttal brief because content. 65884 (November 1, 2005) (‘‘Second it contained information not timely filed Sunset Review’’). On the basis of a under the regulations and offered AHUG Final Results of Review notice of intent to participate and an the opportunity to redact the new adequate substantive response filed on We determine that termination of the information and to re–submit the brief behalf of domestic interested parties, to the Department within two days. On Suspension Agreement on uranium and an inadequate response from May 26, 2006, AHUG re–submitted its from Russia would likely lead to a respondent interested parties (in this rebuttal brief; however it failed to redact continuation or recurrence of dumping case, no response), the Department has all references to the new information at the following percentage weighted– conducted an expedited sunset review that appeared in its May 24, 2006 average margin: of this order pursuant to section rebuttal brief. We requested again that 751(c)(3)(B) of the Act and 19 CFR AHUG re–submit its rebuttal brief Weighted–average 351.218(e)(1)(ii)(B). As a result of this Exporter/manufacturer margin (percent) without the references to the new sunset review, the Department finds that information, by the close–of-business on Russia–Wide ...... 115.82 revocation of the countervailing duty May 30, 2006. On, May 30, 2006, AHUG order is likely to lead to continuation or filed its rebuttal brief and redacted all recurrence of a countervailable subsidy new information. Additionally, on May This notice also serves as the only at the level indicated in the ‘‘Final 26, 2006, AHUG submitted a letter to reminder to parties subject to Results of Review’’ section of this the Department which also contained administrative protective order (‘‘APO’’) notice. new and untimely filed information. On of their responsibility concerning the DATES: May 30, 2006, the Department notified return or destruction of proprietary Effective Date: June 6, 2006. AHUG that it was returning this information disclosed under APO in FOR FURTHER INFORMATION CONTACT: additional May 26, 2006 letter because accordance with 19 CFR 351.305 of the Stephanie Moore or Brandon Farlander, it contained information not timely filed Department’s regulations. Timely AD/CVD Operations, Import under the Department’s regulations. No notification of the return or destruction Administration, International Trade Administration, U.S. Department of interested party requested a hearing in of APO materials or conversion to Commerce, 14th Street and Constitution this sunset review. judicial protective order is hereby Ave., NW., Washington, DC 20230; Analysis of Comments Received requested. Failure to comply with the telephone: (202) 482–3692 or (202) 482– All issues raised by parties to this regulations and terms of an APO is a 5439, respectively. violation which is subject to sanction. sunset review are addressed in the SUPPLEMENTARY INFORMATION: ‘‘Issues and Decision Memorandum for This sunset review and notice are in the Sunset Review of the Agreement accordance with sections 751(c), 752, Background Suspending the Antidumping and 777(i)(1) of the Act. The countervailing duty order which covers CORE from Korea, was published Investigation on Uranium from the Dated: May 30, 2006. Russian Federation; Final Results’’ from in the Federal Register on August 17, Joseph A. Spetrini, Deputy Assistant David M. Spooner, 1993. See Countervailing Duty Orders Assistant Secretary for Import and Amendments to Final Affirmative 8 We note that Tenex did not file either a waiver Administration. Countervailing Duty Determinations: of intent to participate in this sunset review [FR Doc. E6–8758 Filed 6–5–06; 8:45 am] Certain Steel Products from Korea, 58 pursuant to Section 351.218(d)(2) of the BILLING CODE 3510–DS–S Department’s sunset regulations or a complete FR 43752 (August 17, 1993). On substantive response to the notice of initiation November 1, 2005, the Department pursuant to Section 351.218(d) (3). initiated the second sunset review of the

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countervailing duty order on CORE from later than May 30, 2006. See Certain varnished or coated with plastics or Korea, pursuant to section 751(c) of the Corrosion-Resistant Carbon Steel Flat other nonmetallic substances in Act. See Second Sunset Review. The Products from Australia, Canada, addition to the metallic coating. Department received notices of intent to France, Germany, Japan, and South Excluded from this order are clad participate from Nucor Corporation Korea: Extension of Time Limits for products in straight lengths of 0.1875 (‘‘Nucor’’), Mittal Steel USA ISG Inc. Final Results of Expedited Sunset inch or more in composite thickness (‘‘Mittal Steel USA’’) and Ispat-Inland Reviews, 71 FR 10006 (February 28, and of a width which exceeds 150 (‘‘Ispat’’); United States Steel 2006). millimeters and measures at least twice Corporation (‘‘U.S. Steel’’); (collectively, Scope of the Order the thickness. Also excluded from this ‘‘domestic interested parties’’); and on order are certain clad stainless flat- behalf of United Steel, Paper and The merchandise covered by this rolled products, which are three-layered Forestry, Rubber, Manufacturing, order includes flat-rolled carbon steel corrosion-resistant carbon steel flat- Energy, Allied Industrial and Service products, of rectangular shape, either rolled products less than 4.75 Workers International Union, AFL–CIO– clad, plated, or coated with corrosion- millimeters in composite thickness that CLC (‘‘USW’’), within the deadline resistant metals such as zinc, aluminum, consist of a carbon steel flat-rolled specified in 19 CFR 351.218(d)(1)(i). or zinc-, aluminum-, nickel- or iron- product clad on both sides with Domestic interested parties and the based alloys, whether or not corrugated stainless steel in a 20%-60%-20% ratio. USW claimed interested party status or painted, varnished or coated with Although the HTSUS subheadings are under sections 771(9)(C) and (D) of the plastics or other nonmetallic substances provided for convenience and customs Act, as U.S. producers and a certified in addition to the metallic coating, in purposes, the written description of the union engaged in the manufacture, coils (whether or not in successively merchandise covered by this order is production, or wholesale of CORE in the superimposed layers) and of a width of dispositive. United States. 0.5 inch or greater, or in straight lengths Analysis of Comments Received On December 1, 2005, the Department which, if of a thickness less than 4.75 millimeters, are of a width of 0.5 inch received a substantive response from All issues raised in substantive or greater and which measures at least domestic interested parties within the responses by parties in this sunset 10 times the thickness or if of a deadline specified in section 19 CFR review are addressed in the Issues and thickness of 4.75 millimeters or more 351.218(d)(3)(i). The Department did Decision Memorandum for Final Results are of a width which exceeds 150 not receive any responses from any of Expedited Five-Year (‘‘Sunset’’) millimeters and measures at least twice respondent interested party to this Review of the Countervailing Duty Order the thickness, as currently classifiable in proceeding. In accordance with 19 CFR the Harmonized Tariff Schedule of the on Certain Corrosion-Resistant Carbon 351.218(e)(1)(ii)(C)(2), the Department United States (HTSUS) under item Steel Flat Products from Korea notified the International Trade numbers 7210.31.0000, 7210.39.0000, (‘‘Decision Memo’’), from Stephen J. Commission (‘‘ITC’’) that respondent 7210.41.0000, 7210.49.0030, Claeys, Deputy Assistant Secretary for interested parties provided an 7210.49.0090, 7210.60.0000, Import Administration, to David M. inadequate response to the Notice of 7210.70.6030, 7210.70.6060, Spooner, Assistant Secretary for Import Initiation of Five-Year (‘‘Sunset’’) 7210.70.6090, 7210.90.1000, Administration, dated May 30, 2006, Review.1 The Department, therefore, is 7210.90.6000, 7210.90.9000, which is hereby adopted by this notice. conducting an expedited sunset review 7212.21.0000, 7212.29.0000, The issues discussed in the Decision of the countervailing duty order, 7212.30.1030, 7212.30.1090, Memo include the likelihood of pursuant to 19 CFR 351.218(e)(1)(ii)(B) 7212.30.3000, 7212.30.5000, continuation or recurrence of a and 351.218(e)(1)(ii)(C)(2). 7212.40.1000, 7212.40.5000, countervailable subsidy and the net In accordance with section 7212.50.0000, 7212.60.0000, countervailable subsidy rate likely to 751(c)(5)(C)(v) of the Act, the 7215.90.1000, 7215.90.5000, prevail if the order were revoked. Department may treat a review as 7217.12.1000, 7217.13.1000, Parties can find a complete discussion extraordinarily complicated if it is a 7217.19.1000, 7217.19.5000, of all issues raised in this sunset review review of a transition order (i.e., an 7217.22.5000, 7217.23.5000, and the corresponding recommendation order in effect on January 1, 1995, the 7217.29.1000, 7217.29.5000, in this public memorandum which is on effective date of the Uruguay Round 7217.32.5000, 7217.33.5000, file in B–099, the Central Records Unit, Agreements Act), as is the case in this 7217.39.1000, and 7217.39.5000. of the main Commerce building. In proceeding. As such, the Department Included in this order are flat-rolled addition, a complete version of the determined that the sunset review of the products of non-rectangular cross- Decision Memo can be accessed directly countervailing duty order on CORE from section where such cross-section is on the Department’s Web page at Korea is extraordinarily complicated achieved subsequent to the rolling http://ia.ita.doc.gov/frn. The paper copy and required additional time for the process (i.e., products which have been and electronic version of the Decision completion of the final results of review. ‘‘worked after rolling’’)—for example, Memo are identical in content. In accordance with section 751(c)(5)(B) products which have been beveled or Final Results of Review of the Act, the Department extended the rounded at the edges. Excluded from time limit for completion of the final this order are flat-rolled steel products The Department determines that results of CORE from Korea until no either plated or coated with tin, lead, revocation of the countervailing duty chromium, chromium oxides, both tin order on CORE from Korea is likely to 1 See December 21, 2005 letter to ITC, Robert Carpenter, Director of Investigations, from Barbara and lead (‘‘terne plate’’), or both lead to continuation or recurrence of E. Tillman, Director, Office 6, AD/CVD Operations, chromium and chromium oxides (‘‘tin- countervailable subsidies at the Import Administration. free steel’’), whether or not painted, following countervailing duty rate:

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Net subsidy conducting an expedited sunset review exceeding 1,250 millimeters and of a Manufacturer/exporter margin pursuant to section 751(c)(3)(B) of the thickness of not less than 4 millimeters, (percent) Act and 19 CFR 351.218(e)(1)(ii)(B). As not in coils and without patterns in a result of this sunset review, the relief), of rectangular shape, neither All Producers/Exporters from clad, plated nor coated with metal, Korea 2 ...... 1.15 Department finds that revocation of the CVD order would be likely to lead to whether or not painted, varnished, or This notice also serves as the only continuation or recurrence of coated with plastics or other reminder to parties subject to countervailable subsidies at the levels nonmetallic substances; and certain hot- administrative protective orders (APO) indicated in the ‘‘Final Results of rolled carbon steel flat-rolled products of their responsibility concerning the Review’’ section of this notice. in straight lengths, of rectangular shape, return or destruction of proprietary DATES: Effective Date: June 6, 2006. hot rolled, neither clad, plated, nor coated with metal, whether or not information disclosed under APO in FOR FURTHER INFORMATION CONTACT: accordance with section 351.303 of the Robert Copyak or Brandon Farlander, painted, varnished, or coated with plastics or other nonmetallic substances, Department’s regulations. Timely AD/CVD Operations, Import 4.75 millimeters or more in thickness notification of the return or destruction Administration, U.S. Department of and of a width which exceeds 150 of APO materials or conversion to Commerce, 14th Street & Constitution millimeters and measures at least twice judicial protective order is hereby Avenue, NW., Washington, DC 20230; the thickness, as currently classifiable in requested. Failure to comply with the telephone: 202–482–2209 or 202–482– the Harmonized Tariff Schedule of the regulations and terms of an APO is a 0182, respectively. United States (‘‘HTSUS’’) under item violation which is subject to sanction. SUPPLEMENTARY INFORMATION: numbers 7208.31.0000, 7208.32.0000, We are issuing and publishing this 7208.33.1000, 7208.33.5000, determination and notice in accordance Background 7208.41.0000, 7208.42.0000, with sections 751(c), 752, and 777(i) of On November 1, 2005, the Department 7208.43.0000, 7208.90.0000, the Act. initiated a sunset review of the CVD 7210.70.3000, 7210.90.9000, Dated: May 30, 2006. order on certain cut-to-length carbon 7211.11.0000, 7211.12.0000, David M. Spooner, steel plate from Mexico pursuant to 7211.21.0000, 7211.22.0045, Assistant Secretary for Import section 751(c) of the Act. See Initiation 7211.90.0000, 7212.40.1000, Administration. of Five-Year (‘‘Sunset’’) Reviews, 70 FR 7212.40.5000, and 7212.50.0000. [FR Doc. E6–8754 Filed 6–5–06; 8:45 am] 65884. In November 2005, the Included in this administrative review Department received notices of intent to BILLING CODE 3510–DS–P are flat-rolled products of non- participate on behalf of Nucor rectangular cross-section where such Corporation (‘‘Nucor’’); IPSCO Steel Inc. cross-section is achieved subsequent to DEPARTMENT OF COMMERCE (‘‘IPSCO’’); Oregon Steel Mills (‘‘Oregon the rolling process (i.e., products which Steel’’); Mittal Steel USA ISG Inc. have been ‘‘worked after rolling’’)—for International Trade Administration (‘‘Mittal Steel USA’’); and United Steel, example, products which have been Paper and Forestry, Rubber, [C–201–810] beveled or rounded at the edges. Manufacturing, Energy, Allied Excluded from this administrative Certain Cut-to-Length Carbon Steel Industrial and Service Workers review is grade X–70 plate. HTSUS Plate From Mexico: Final Results of International Union, AFL–CIO–CLC subheadings are provided for Expedited Five-Year (‘‘Sunset’’) Review (‘‘USW’’) (collectively, ‘‘domestic convenience and customs purposes. of the Countervailing Duty Order interested parties’’). The domestic Although the HTSUS subheadings are interested parties claimed interested provided for convenience and customs AGENCY: Import Administration, party status under sections 771(9)(C) purposes, the written description of the International Trade Administration, and (D) of the Act, as domestic merchandise covered by this order is Department of Commerce. producers of a like product, or a union dispositive. SUMMARY: On November 1, 2005, the engaged in the production of subject Department of Commerce (‘‘the merchandise in the United States. The Analysis of Comments Received Department’’) initiated a sunset review Department received a complete All issues raised in this review are of the countervailing duty (‘‘CVD’’) substantive response from the domestic addressed in the ‘‘Issues and Decision order on certain cut-to-length carbon interested parties within the 30-day Memorandum for the Expedited Sunset steel plate from Mexico pursuant to deadline specified in 19 CFR Review of the Countervailing Duty Order section 751(c) of the Tariff Act of 1930, 351.218(d)(3)(i). We did not receive a on Certain Cut-to-Length Carbon Steel as amended (‘‘the Act’’). See Initiation substantive response or a rebuttal Plate from Mexico; Final Results’’ of Five-Year (‘‘Sunset’’) Reviews, 70 FR response from any foreign respondents. (‘‘Decision Memorandum’’) from 65884 (November 1, 2005). On the basis As a result, pursuant to section Stephen J. Claeys, Deputy Assistant of notices of intent to participate and an 751(c)(3)(B) of the Act and 19 CFR Secretary for Import Administration to adequate substantive response filed on 351.218(e)(1)(ii)(C)(2), the Department is David M. Spooner, Assistant Secretary behalf of the domestic interested parties, conducting an expedited sunset review for Import Administration, dated May and an inadequate response from of this CVD order. 30, 2006, which is hereby adopted by this notice. The issues discussed in the respondent interested parties (in this Scope of the Order case, no response), the Department is Decision Memorandum include the The products covered by this order likelihood of continuation or recurrence 2 Union Steel was excluded from the order on the are certain cut-to-length carbon steel of a countervailable subsidy and the net basis of a de minimis net subsidy rate. See Certain plates. These products include hot- countervailable subsidy rate likely to Cold-Rolled and Corrosion-Resistant Carbon Steel rolled carbon steel universal mill plates prevail if the order were revoked. Flat Products From Korea: Amended Final Affirmative Countervailing Duty Determinations in (i.e., flat-rolled products rolled on four Parties can find a complete discussion Accordance with Decision Upon Remand, 66 FR faces or in a closed box pass, of a width of all issues raised in this review and 16656 (March 27, 2001). exceeding 150 millimeters but not the corresponding recommendation in

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this public memorandum which is on SUMMARY: On November 1, 2005, the specified in 19 CFR 351.218(d)(1)(i).1 file in the Central Records Unit, Room Department of Commerce (‘‘the Domestic interested parties claimed B–099 of the main Commerce building. Department’’) published in the Federal interested party status under sections In addition, a complete version of the Register the notice of initiation of the 771(9)(C) and (D) of the Act, as U.S. Decision Memorandum can be accessed second five-year sunset review of the producers and a certified union engaged directly on the Web at http:// countervailing duty order on certain in the manufacture, production, or ia.ita.doc.gov/frn. The paper copy and cut–to-length carbon steel plate (‘‘CTL wholesale of CTL Plate in the United electronic version of the Decision Plate’’) from Brazil, pursuant to section States. Memorandum are identical in content. 751(c) of the Tariff Act of 1930, as On November 30, 2005, the amended (‘‘the Act’’). See Initiation of Final Results of Review Department received a substantive Five-year (‘‘Sunset’’) Reviews, 70 FR response from domestic interested The Department determines that 65884 (November 1, 2005)(‘‘Second parties within deadline specified in 19 revocation of the CVD order on certain Sunset Review’’). On the basis of a CFR 351.218(d)(3)(i).2 The Department cut-to-length carbon steel plate from notice of intent to participate and an did not receive any responses from any Mexico would be likely to lead to adequate substantive response filed on respondent interested party to this continuation or recurrence of a behalf of domestic interested parties, proceeding. In accordance with 19 CFR countervailable subsidy at the rates and an inadequate response from 351.218(e)(1)(ii)(C)(1), the Department listed below: respondent interested parties (in this notified the International Trade case, no response), the Department has Commission (‘‘ITC’’) that respondent Net conducted an expedited sunset review countervailable interested parties provided an Manufacturer/exporter subsidy of this order pursuant to section inadequate response to the Notice of (percent) 751(c)(3)(B) of the Act and section Initiation of Five-year (‘‘Sunset’’) 351.218(e)(1)(ii)(B) of the Department’s Reviews.3 The Department, therefore, AHMSA ...... 28.32 regulations. As a result of this sunset All Others ...... 20.25 has conducted an expedited sunset review, the Department finds that review of the countervailing duty order, revocation of the countervailing duty pursuant to 19 CFR 351.218(e)(1)(ii)(B) Notification Regarding Administrative order is likely to lead to continuation or and 351.218(e)(1)(ii)(C)(2). Protective Order recurrence of a countervailable subsidy at the level indicated in the ‘‘Final In accordance with section This notice also serves as the only 751(c)(5)(C)(v) of the Act, the reminder to parties subject to Results of Review’’ section of this notice. Department may treat a review as administrative protective order (‘‘APO’’) extraordinarily complicated if it is a of their responsibility concerning the EFFECTIVE DATE: June 6, 2006. review of a transition order (i.e., an return or destruction of proprietary FOR FURTHER INFORMATION CONTACT: order in effect on January 1, 1995, the information disclosed under APO in Martha Douthit or Dana Mermelstein, effective date of the Uruguay Round accordance with 19 CFR 351.305 of the AD/CVD Operations, Office 6, Import Agreements Act), as is the case in this Department’s regulations. Timely Administration, International Trade proceeding. As such, the Department notification of the return or destruction Administration, U.S. Department of determined that the sunset review of the of APO materials or conversion to Commerce, 14th Street and Constitution countervailing duty order on CTL Plate judicial protective order is hereby Ave., NW., Washington, DC 20230; from Brazil, is extraordinarily requested. Failure to comply with the telephone: (202) 482–2371 or (202) 482– complicated and requires additional regulations and terms of an APO is a 3964, respectively. time for the completion of final results violation which is subject to sanction. SUPPLEMENTARY INFORMATION: of review. In accordance with section We are issuing and publishing these 751(c)(5)(B) of the Act, the Department results and notice in accordance with Background extended the time limit for completion sections 751(c), 752(b), and 777(i)(1) of of the final results of CTL Plate from the Act. The countervailing duty order which covers CTL Plate from Brazil was Brazil until no later than May 30, 2006. Dated: May 30, 2006. published in the Federal Register on See Cut–to-Length Carbon Steel Plate David M. Spooner, August 17, 1993. See Countervailing from Brazil and Spain; Extension of Assistant Secretary for Import Duty Order and Amendment to Final Time Limits for Final Results of Administration. Affirmative Countervailing Duty Expedited Five-year (‘‘Sunset’’) Reviews [FR Doc. 06–5144 Filed 6–5–06; 8:45 am] Determination: Certain Steel Products BILLING CODE 3510–DS–P From Brazil, 58 FR 43751 (August 17, 1 Domestic interested parties note that Mittal, IPSCO, and Oregon Steel Mills, were the petitioners 1993). On November 1, 2005, the or successors to petitioners in the original Department initiated the second sunset investigation and that they have participated in the DEPARTMENT OF COMMERCE review of the countervailing duty order first sunset review. on CTL Plate from Brazil, pursuant to 2 On December 1, 2005, the Department received International Trade Administration section 751(c) of the Act. See Second a letter from domestic interested parties regarding an amendment to their November 30, 2005 Sunset Review. The Department substantive response to the Department’s initiation (C–351–818) received notices of intent to participate of the sunset review on CTL Plate from Brazil. In from IPSCO, Inc., Mittal Steel USA ISG, the letter, domestic interested parties included Cut–to-Length Carbon Steel Plate from Inc., Nucor Corporation, Oregon Steel United Steel, Paper and Forestry, Rubber, Brazil: Final Results of Expedited Five- Manufacturing, Energy, Allied Industrial and Mills, Inc., and United Steel, Paper and year (‘‘Sunset’’) Review of the Service Workers International Union, AFL-CIO-CLC Forestry, Rubber, Manufacturing, Countervailing Duty Order (‘‘USW’’) to the November 30, 2005 substantive Energy, Allied Industrial and Service response. 3 AGENCY: Import Administration, Workers International Union, AFL–CIO- See December 21, 2005 letter to Robert Carpenter, Director of Investigations, ITC, from International Trade Administration, CLC (‘‘USW’’) (collectively, ‘‘domestic Barbara E. Tillman, Director, Office 6, AD/CVD Department of Commerce. interested parties’’), within the deadline Operations, Import Administration.

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of Countervailing Duty Orders; 71 FR Analysis of Comments Received with sections 751(c), 752, and 777(i) of 7018 (February 10, 2006). All issues raised in substantive the Act. Since the publication of its results in responses by parties to this sunset Dated: May 30, 2006. the first sunset review (see Cut–to- review are addressed in the Issues and David M. Spooner, Length Carbon Steel Plate from Brazil; Decision Memorandum for Final Results Assistant Secretary for Import Final Results of Expedited Sunset of Expedited Five-year (‘‘Sunset’’) Administration. Review of Countervailing Duty Order, 65 Review of the Countervailing Duty Order [FR Doc. E6–8756 Filed 6–5–06; 8:45 am] FR 18065 (April 6, 2000) (‘‘First Sunset on Certain Cut–to-Length Steel Plate BILLING CODE 3510–DS–S Review’’)), there have been no from Brazil, (‘‘Decision Memo’’) from administrative reviews of this order. Stephen J. Claeys, Deputy Assistant Secretary for Import Administration, to DEPARTMENT OF COMMERCE Scope of the Order David M. Spooner, Assistant Secretary for Import Administration, dated May International Trade Administration The products covered by this 30, 2006, which is hereby adopted by countervailing duty order include hot– this notice. The issues discussed in the rolled carbon steel universal mill plates (C–469–804) Decision Memo include the likelihood (i.e., flat–rolled products rolled on four of continuation or recurrence of a Cut–to-Length Carbon Steel Plate from faces or in a closed box pass, of a width countervailable subsidy and the net Spain: Final Results of Expedited Five- exceeding 150 millimeters but not countervailable subsidy rate likely to year (‘‘Sunset’’) Review of the exceeding 1,250 millimeters and of a prevail if the order were the order Countervailing Duty Order thickness of not less than 4 millimeters, revoked. not in coils and without patterns in Parties can find a complete discussion AGENCY: Import Administration, relief), of rectangular shape, neither of all issues raised in this sunset review International Trade Administration, clad, plated, nor coated with metal, and the corresponding recommendation Department of Commerce. whether or not painted, varnished, or in this public memorandum which is on SUMMARY: On November 1, 2005, the coated with plastics or other file in B–099, the Central Records Unit, Department of Commerce (‘‘the nonmetallic substances; and certain of the main Commerce building. In Department’’) published in the Federal hot–rolled carbon steel flat–rolled addition, a complete version of the Register the notice of initiation of the products in straight lengths, of Decision Memo can be accessed directly second five-year sunset review of the rectangular shape, hot rolled, neither on the Department’s Web page at http:// countervailing duty order on certain clad, plated, nor coated with metal, ia.ita.doc.gov/frn. The paper copy and cut–to-length carbon steel plate (‘‘CTL whether or not painted, varnished, or electronic version of the Decision Memo Plate’’) from Spain, pursuant to section coated with plastics or other are identical in content. 751(c) of the Tariff Act of 1930, as nonmetallic substances, 4.75 Final Results of Review amended (‘‘the Act’’). See Initiation of millimeters or more in thickness and of Five-year (‘‘Sunset’’) Reviews, 70 FR a width which exceeds 150 millimeters The Department determines that 65884 (November 1, 2005) (‘‘Second and measures at least twice the revocation of the countervailing duty Sunset Review’’). On the basis of a thickness, as currently classifiable in the order on CTL Plate from Brazil would be notice of intent to participate and an Harmonized Tariff Schedule of the likely to lead to continuation or adequate substantive response filed on United States (‘‘HTSUS’’) under item recurrence of countervailable subsidies behalf of domestic interested parties, numbers 7208.40.3030, 7208.40.3060, at the following net countervailing duty and an inadequate response from 7208.51.0030, 7208.51.0045, rates: respondent interested parties (in this 7208.51.0060, 7208.52.0000, case, no response), the Department has 7208.90.0000, 7210.70.3000, Net Subsidy Rate conducted an expedited sunset review Manufacturer/Exporter (percent) 7210.90.9000, 7211.13.0000, of this order pursuant to section 7211.14.0030, 7211.14.0045, Usinas Siderurgicas de 751(c)(3)(B) of the Act and section 7211.90.0000, 7212.40.1000, Minas Gerais S.A. 351.218(e)(1)(ii)(B) of the Department’s 7212.40.5000, and 7212.50.0000. (‘‘USIMINAS’’) ...... 5.44 regulations. As a result of this sunset Included within the scope are flat– Companhia Siderurgica review, the Department finds that rolled products of non–rectangular Paulista (‘‘COSIPA’’) 48.64 revocation of the countervailing duty cross-section where such cross-section All others ...... 23.10 order is likely to lead to continuation or is achieved subsequent to the rolling recurrence of a countervailable subsidy This notice also serves as the only process (i.e., products which have been at the level indicated in the ‘‘Final reminder to parties subject to ‘‘worked after rolling’’); for example, Results of Review’’ section of this administrative protective orders (APO) products which have been beveled or notice. of their responsibility concerning the rounded at the edges. Excluded is grade return or destruction of proprietary EFFECTIVE DATE: June 6, 2006. X–70 plate. These HTSUS item numbers information disclosed under APO in FOR FURTHER INFORMATION CONTACT: are provided for convenience and accordance with section 351.305 of the Myrna Lobo or Sean Carey, AD/CVD customs purposes. The Department’s Department’s regulations. Timely Operations, Office 6, Import written description remains dispositive. notification of the return or destruction Administration, International Trade Since the completion of the first of APO materials or conversion to Administration, U.S. Department of sunset review, the Department has judicial protective order is hereby Commerce, 14th Street and Constitution determined that continuous cast steel requested. Failure to comply with the Ave., N.W., Washington, D.C. 20230; slab is outside the scope of this order. regulations and terms of an APO is a telephone: (202) 482–2371 or (202) 482– See Notice of Scope Rulings and Anti– violation which is subject to sanction. 3964, respectively. circumvention Inquiries, 68 FR 36770 We are issuing and publishing this (June 19, 2003). determination and notice in accordance SUPPLEMENTARY INFORMATION:

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Background extraordinarily complicated if it is a extinguish the non–recurring, allocable The countervailing duty order which review of a transition order (i.e, an order subsidies provided to Aceralia prior to covers CTL Plate from Spain, was in effect on January 1, 1995, the its privatization. The Department published in the Federal Register on effective date of the Uruguay Round further determined that it had been August 17, 1993. See Countervailing Agreements Act), as is the case in this provided substantial evidence that Duty Order: Certain Steel Products from proceeding. As such, the Department demonstrated the termination of Spain, 58 FR 43761 (August 17, 1993). determined that the sunset review of the programs under Royal Decree 878/81 On November 1, 2005, the Department countervailing duty order on CTL Plate that were originally found initiated the second sunset review of the from Spain is extraordinarily countervailable in the investigation. countervailing duty order on CTL Plate complicated and required additional However, because countervailable programs continued to exist, the from Spain, pursuant to section 751(c) time for the completion of the final results of review. In accordance with Department determined that revocation of the Act. See Second Sunset Review. section 751(c)(5)(B) of the Act, the of the countervailing duty order would The Department received notices of Department extended the time limit for likely lead to continuation or recurrence intent to participate from IPSCO, Inc., completion of the final results of CTL of a countervailable subsidy. Mittal Steel USA ISG, Inc., Nucor Plate from Spain until no later than May Corporation, Oregon Steel Mills, Inc., Scope of the Order 30, 2006. See Cut–to-Length Carbon United Steel, Paper and Forestry, Steel Plate from Brazil and Spain; The products covered by this Rubber, Manufacturing, Energy, Allied Extension of Time Limits for Final countervailing duty order, include hot– Industrial and Service Workers Results of Expedited Five-year rolled carbon steel universal mill plates International Union, AFL–CIO-CLC (‘‘Sunset’’) Reviews of Countervailing (i.e., flat–rolled products rolled on four (‘‘USW’’) (collectively ‘‘domestic Duty Orders; 71 FR 7018 (February 10, faces or in a closed box pass, of a width interested parties’’), within the deadline exceeding 150 millimeters but not 1 2006). specified in 19 CFR 351.218(d)(1)(i). Since the publication of its results in exceeding 1,250 millimeters and of a Domestic interested parties claimed the first sunset review, see Cut–to- thickness of not less than 4 millimeters, interested party status under sections Length Carbon Steel Plate from Spain; not in coils and without patterns in 771(9)(C) and (D) of the Act, as U.S. Final Results of Expedited Sunset relief), of rectangular shape, neither producers and a certified union engaged Review of Countervailing Duty Order, 65 clad, plated, nor coated with metal, in the manufacture, production, or FR 18307 (April 7, 2000) (‘‘First Sunset whether or not painted, varnished, or wholesale of CTL Plate in the United Review’’), the Department has coated with plastics or other States. conducted two proceedings pursuant to nonmetallic substances; and certain On November 30, 2005, the Section 129 of the Uruguay Round hot–rolled carbon steel flat–rolled Department received a substantive Agreements Act (URAA). See Final products in straight lengths, of response from domestic interested Results of Expedited Sunset Review of rectangular shape, hot rolled, neither parties within the deadline specified in Cut–to-Length Carbon Steel Plate from clad, plated, nor coated with metal, section 19 CFR 351.218(d)(3)(i).2 The Spain (‘‘First Section 129 Review’’), whether or not painted, varnished, or Department did not receive any from Joseph A. Spetrini, Deputy coated with plastics or other responses from any respondent Assistant Secretary for Import nonmetallic substances, 4.75 interested party to this proceeding. In Administration, to James J. Jochum, millimeters or more in thickness and of accordance with 19 CFR Assistant Secretary for Import a width which exceeds 150 millimeters 351.218(e)(1)(ii)(C)(2), the Department Administration, dated October 24, 2003; and measures at least twice the notified the International Trade and Second Section 129 Determination thickness, as currently classifiable in the Commission (‘‘ITC’’) that respondent on the Sunset Review of the Harmonized Tariff Schedule of the interested parties provided inadequate Countervailing Duty Order on Certain United States (‘‘HTSUS’’) under item response to the Notice of Initiation of Cut–to-Length Carbon Steel Plate from numbers 7208.40.3030, 7208.40.3060, Five-year (‘‘Sunset’’) Review.3 The Spain (‘‘Second Section 129 Review’’), 7208.51.0030, 7208.51.0045, Department, therefore, is conducting an from Stephen J. Claeys, Deputy 7208.51.0060, 7208.52.0000, expedited sunset review of the Assistant Secretary for Import 7208.90.0000, 7210.70.3000, countervailing duty order, pursuant to Administration, to David M. Spooner, 7210.90.9000, 7211.13.0000, 19 CFR 351.218(e)(1)(ii)(B) and Assistant Secretary for Import 7211.14.0030, 7211.14.0045, 351.218(e)(1)(ii)(C)(2). Administration, dated May 26, 2006. 7211.90.0000, 7212.40.1000, In accordance with section The First Section 129 Review was 7212.40.5000, and 7212.50.0000. 751(c)(5)(C)(v) of the Act, the conducted pursuant to a WTO ruling Included within the scope are flat– Department may treat a review as that found the Department must modify rolled products of non–rectangular its privatization methodology and apply cross-section where such cross-section 1 Domestic interested parties note that Mittal, that revised methodology to the First is achieved subsequent to the rolling IPSCO, and Oregon Steel Mills, were the petitioners Sunset Review. The Department or successors to petitioners in the original process (i.e., products which have been investigation and that they have participated in modified its methodology but ‘‘worked after rolling’’); for example, subsequent reviews. determined it unnecessary to reach the products which have been beveled or 2 On December 1, 2005, the Department received privatization issue in the First Section rounded at the edges. Excluded is grade a letter from domestic interested parties amending 129 Review in view of its conclusion on X–70 plate. These HTSUS item numbers their November 30, 2005 substantive response to the Department’s initiation of the sunset review on recurring, non–allocable subsidies. The are provided for convenience and CTL Plate from Spain, to include United Steel, WTO, however, disagreed and directed customs purposes. The Department’s Paper and Forestry, Rubber, Manufacturing, Energy, the Department to conduct a second 129 written description remains dispositive. Allied Industrial and Service Workers International proceeding to apply its modified Union, AFL-CIO-CLC (‘‘USW’’). privatization methodology. Analysis of Comments Received 3 See December 21, 2005 letter to ITC, Robert Carpenter, Director of Investigations, from Barbara In the Second Section 129 Review, the All issues raised in substantive E. Tillman, Director, Office 6, AD/CVD Operations, Department determined that the responses by parties in this sunset Import Administration. privatization of Aceralia did not review are addressed in the Issues and

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Decision Memorandum for Final Results DEPARTMENT OF COMMERCE payoffs for the nation than they would of Expedited Five-year (‘‘Sunset’’) otherwise pursue. This request is for the Review of the Countervailing Duty Order National Institute of Standards and information collection requirements on Cut–to-Length Steel Plate from Spain Technology associated with completing project (‘‘Decision Memo’’), from Stephen J. surveys once an award is granted. The Claeys, Deputy Assistant Secretary for Proposed Information Collection; intent of the collection is to meet Import Administration, to David M. Comment Request; Advanced statutory requirements for ATP, as well Spooner, Assistant Secretary for Import Technology Program Business as compliance with 15 CFR part 14 and Administration, dated May 30, 2006, Reporting System the Government Performance and which is hereby adopted by this notice. ACTION: Notice. Results Act. The issues discussed in the Decision II. Method of Collection Memo include the likelihood of SUMMARY: The Department of Commerce continuation or recurrence of a (DOC), as part of its continuing effort to The baseline, quarterly, anniversary, countervailable subsidy and the net reduce paperwork and respondent and closeout business reports are countervailable subsidy rate likely to burden, invites the general public and submitted in a Web-based survey prevail if the order were revoked. other Federal agencies to comment on instrument. The post-project survey Parties can find a complete discussion the continuing and proposed report is conducted as a telephone of all issues raised in this sunset review information collection, as required by survey interview and supplemented and the corresponding recommendation the Paperwork Reduction Act of 1995, with a Web-based survey instrument. Public Law 104–13 (44 U.S.C. in this public memorandum which is on III. Data file in B–099, the Central Records Unit, 3506(c)(2)(A)). of the main Commerce building. In DATES: Written comments must be OMB Number: 0693–0009. addition, a complete version of the submitted on or before August 7, 2006. Form Numbers: None. Decision Memo can be accessed directly ADDRESSES: Direct all written comments on the Department’s Web page at http:// to Diana Hynek, Departmental Type of Review: Regular submission. ia.ita.doc.gov/frn. The paper copy and Paperwork Clearance Officer, Affected Public: Business or other for- electronic version of the Decision Memo Department of Commerce, Room 6625, profit organizations; and not-for-profit are identical in content. 14th and Constitution Avenue, NW., institutions. Washington, DC 20230 (or via the Final Results of Review Estimated Number of Respondents: Internet at [email protected]). 425. The Department determines that FOR FURTHER INFORMATION CONTACT: Estimated Time per Response: 5 revocation of the countervailing duty Requests for additional information or Hours. order on CTL Plate from Spain is likely copies of the information collection instruments and instructions should be Estimated Total Annual Respondent to lead to continuation or recurrence of Burden Hours: 2,125. countervailable subsidies at the directed to the attention of Barbara following countervailing duty rate: Lambis/Advanced Technology Program Estimated Total Annual Respondent Senior Policy and Operations Advisor/ Cost Burden: $212,500. Net Subsidy Margin 100 Bureau Drive, Stop 4700, IV. Request for Comments Manufacturer/Exporter (percent) Gaithersburg, MD 20899–4700/301– 975–4447/[email protected]. Comments are invited on: (a) Whether All Producers/Exporters SUPPLEMENTARY INFORMATION: the proposed collection of information from Spain ...... 33.68 is necessary for the proper performance I. Abstract of the functions of the agency, including This notice also serves as the only This submission under the Paperwork whether the information will have reminder to parties subject to Reduction Act represents a request for practical utility; (b) the accuracy of the administrative protective orders (APO) extension of a currently approved agency’s estimate of the burden of their responsibility concerning the collection by the Department of (including hours and cost) of the return or destruction of proprietary Commerce’s National Institute of proposed collection of information; (c) information disclosed under APO in Standards and Technology. The ways to enhance the quality, utility, and accordance with section 351.303 of the Advanced Technology Program (ATP) clarity of the information to be Department’s regulations. Timely provides cost-shared multi-year funding collected; and (d) ways to minimize the notification of the return or destruction to single companies and to industry-led burden of the collection of information of APO materials or conversion to joint ventures to accelerate the on respondents, e.g., the use of judicial protective order is hereby development of challenging, high-risk automated collection techniques or requested. Failure to comply with the technologies that promise significant other forms of information technology. regulations and terms of an APO is a commercial payoffs and widespread Comments submitted in response to violation which is subject to sanction. benefits for the nation. This this notice will be summarized or We are issuing and publishing this government-industry partnership aids included in the request for OMB determination and notice in accordance companies in accelerating the approval of this information collection; with sections 751(c), 752, and 777(i) of development of emerging or enabling they also will become a matter of public the Act. technologies that lead to revolutionary record. new products and industrial processes Dated: May 30, 2006. and services that can compete in rapidly Dated: June 1, 2006. David M. Spooner, changing world markets. ATP Gwellnar Banks, Assistant Secretary for Import challenges the research and Management Analyst, Office of the Chief Administration. development community to take on Information Officer. [FR Doc. E6–8757 Filed 6–5–06; 8:45 am] higher technical risk with [FR Doc. 06–5140 Filed 6–5–06; 8:45 am] BILLING CODE 3510–DS–S commensurately higher potential BILLING CODE 3510–13–P

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DEPARTMENT OF COMMERCE III. Data ACTION: Notice of meeting. OMB Number: 0648–0408. National Oceanic and Atmospheric SUMMARY: In preparation for the 2006 Form Number: None. Administration ICCAT meeting, the Advisory Type of Review: Regular submission. Committee to the U.S. Section to the Proposed Information Collection; Affected Public: Business or other for- International Commission for the Comment Request; Socioeconomic profit organizations; individuals or Conservation of Atlantic Tunas (ICCAT) Monitoring Program for the Channel households; not-for-profit institutions. will have a closed-session, summer Islands National Marine Sanctuary Estimated Number of Respondents: meeting. 815. DATES: AGENCY: National Oceanic and Estimated Time per Response: The meeting will be held June Atmospheric Administration (NOAA). Interviews with commercial fishermen, 26–27, 2006. wholesale processors, for hire recreation ADDRESSES: The meeting will be held at ACTION: Notice. vessel owners/operators: 2 hours; and the Hilton Hotel, 8727 Colesville Road, interviews with customers of for hire Silver Spring, MD 20910. SUMMARY: The Department of Commerce, as part of its continuing recreation vessels: 50 minutes. FOR FURTHER INFORMATION CONTACT: effort to reduce paperwork and Estimated Total Annual Burden Kelly Denit, Office of International respondent burden, invites the general Hours: 1,235. Affairs, 301–713–2276. Estimated Total Annual Cost to public and other Federal agencies to SUPPLEMENTARY INFORMATION: The take this opportunity to comment on Public: $0. Advisory Committee to the U.S. Section proposed and/or continuing information IV. Request for Comments to ICCAT will meet in a closed session to consider information on stock status collections, as required by the Comments are invited on: (a) Whether of highly migratory species. The Paperwork Reduction Act of 1995. the proposed collection of information purpose of this meeting is to discuss DATES: Written comments must be is necessary for the proper performance sensitive information relating to submitted on or before August 7, 2006. of the functions of the agency, including upcoming international negotiations. ADDRESSES: Direct all written comments whether the information shall have to Diana Hynek, Departmental practical utility; (b) the accuracy of the Special Accommodations Paperwork Clearance Officer, agency’s estimate of the burden The meeting locations are physically Department of Commerce, Room 6625, (including hours and cost) of the accessible to people with disabilities. 14th and Constitution Avenue, NW., proposed collection of information; (c) Requests for sign language Washington, DC 20230 (or via the ways to enhance the quality, utility, and interpretation or other auxiliary aids Internet at [email protected]). clarity of the information to be should be directed to Kelly Denit at collected; and (d) ways to minimize the FOR FURTHER INFORMATION CONTACT: (301) 713–2276 at least 5 days prior to burden of the collection of information the meeting date. Requests for additional information or on respondents, including through the copies of the information collection use of automated collection techniques Dated: May 31, 2006. instrument and instructions should be or other forms of information William T. Hogarth, directed to Dr. Vernon R. (Bob) technology. Assistant Administrator for Fisheries, Leeworthy, 301–713–3000, extension Comments submitted in response to National Marine Fisheries Service. 138, or [email protected]. this notice will be summarized and/or [FR Doc. E6–8747 Filed 6–5–06; 8:45 am] SUPPLEMENTARY INFORMATION: included in the request for OMB BILLING CODE 3510–22–S approval of this information collection; I. Abstract they also will become a matter of public The purpose of this information record. DEPARTMENT OF EDUCATION collection is to give users of the Channel Dated: June 1, 2006. Notice of Proposed Information Islands National Marine Sanctuary fair Gwellnar Banks, representation in monitoring the Collection Requests Management Analyst, Office of the Chief socioeconomic impacts of a network of Information Officer. AGENCY: Department of Education. marine reserves (no take areas) in the [FR Doc. E6–8755 Filed 6–5–06; 8:45 am] Channel Islands by implementing a 3- SUMMARY: The IC Clearance Official, year monitoring program. The proposed BILLING CODE 3510–NK–P Regulatory Information Management information collection is a follow-up to Services, Office of Management, invites comments on the proposed information the previous efforts that established DEPARTMENT OF COMMERCE baseline estimates of socioeconomic collection requests as required by the Paperwork Reduction Act of 1995. activities in the Channel Islands National Oceanic and Atmospheric National Marine Sanctuary. The Administration DATES: Interested persons are invited to baseline information was used to submit comments on or before August 7, estimate the expected impacts of [I.D. 081604C] 2006. implementing proposed marine Advisory Committee to the U.S. SUPPLEMENTARY INFORMATION: Section reserves. The new information will be Section of the International 3506 of the Paperwork Reduction Act of used in a monitoring program to test Commission for the Conservation of 1995 (44 U.S.C. Chapter 35) requires whether, and to what extent, the Atlantic Tunas (ICCAT); Summer that the Office of Management and estimated ‘‘expected’’ socioeconomic Meeting Budget (OMB) provide interested impacts actually occur. Federal agencies and the public an early AGENCY: II. Method of Collection National Marine Fisheries opportunity to comment on information Service (NMFS), National Oceanic and collection requests. OMB may amend or Respondents complete paper forms, Atmospheric Administration (NOAA), waive the requirement for public assisted by a NOAA data collector. Commerce. consultation to the extent that public

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participation in the approval process Requests for copies of the proposed (1) Go to IFAP at http://ifap.ed.gov would defeat the purpose of the information collection request may be (2) Scroll down to ‘‘Current information collection, violate State or accessed from http://edicsweb.ed.gov, Publications’’ Federal law, or substantially interfere by selecting the ‘‘Browse Pending (3) Click on ‘‘FAFSAs and Renewal with any agency’s ability to perform its Collections’’ link and by clicking on FAFSAs’’ statutory obligations. The IC Clearance link number 03130. When you access (4) Click on ‘‘By 2007–2008 Award Official, Regulatory Information the information collection, click on Year’’ Management Services, Office of ‘‘Download Attachments’’ to view. (5) Click on ‘‘Draft FAFSA Form/ Management, publishes that notice Written requests for information should Instructions’’ containing proposed information be addressed to U.S. Department of (6) Scroll down and select ‘‘2007– collection requests prior to submission Education, 400 Maryland Avenue, SW., 2008 Draft Form in PDF Format’’ of these requests to OMB. Each Potomac Center, 9th Floor, Washington, Please note that the free Adobe proposed information collection, DC 20202–4700. Requests may also be Acrobat Reader software, version 4.0 or grouped by office, contains the electronically mailed to greater, is necessary to view this file. following: (1) Type of review requested, [email protected] or faxed to 202– This software can be downloaded for e.g. new, revision, extension, existing or 245–6623. Please specify the complete free from Adobe’s Web site: http:// reinstatement; (2) Title; (3) Summary of title of the information collection when www.adobe.com. the collection; (4) Description of the making your request. SUPPLEMENTARY INFORMATION: Section need for, and proposed use of, the Comments regarding burden and/or 483 of the Higher Education Act of information; (5) Respondents and the collection activity requirements 1965, as amended (HEA), requires the frequency of collection; and (6) should be electronically mailed to Secretary, ‘‘in cooperation with agencies Reporting and/or Recordkeeping [email protected]. Individuals who and organizations involved in providing burden. OMB invites public comment. use a telecommunications device for the student financial assistance,’’ to The Department of Education is deaf (TDD) may call the Federal ‘‘produce, distribute and process free of especially interested in public comment Information Relay Service (FIRS) at 1– charge a common financial reporting addressing the following issues: (1) Is 800–877–8339. form to be used to determine the need this collection necessary to the proper [FR Doc. E6–8695 Filed 6–5–06; 8:45 am] and eligibility of a student for financial functions of the Department; (2) will BILLING CODE 4000–01–P assistance * * *’’ under the Title IV, this information be processed and used HEA Programs. This form is the FAFSA. in a timely manner; (3) is the estimate In addition, Section 483 authorizes the of burden accurate; (4) how might the DEPARTMENT OF EDUCATION Secretary to include non-financial data Department enhance the quality, utility, items that assist States in awarding State and clarity of the information to be Proposed Collection; Comment student financial assistance. On collected; and (5) how might the Request February 8, 2006, President Bush signed Department minimize the burden of this the Higher Education Reconciliation Act AGENCY: Department of Education. collection on the respondents, including of 2005 (HERA), Public Law 109–171. through the use of information SUMMARY: The Secretary of Education The HERA made changes to the HEA technology. requests comments on the Free that affect student eligibility and need Application for Federal Student Aid Dated: May 31, 2006. analysis. The HERA changes impact the (FAFSA) that the Secretary proposes to Angela C. Arrington, FAFSA in the following ways: (1) New use for the 2007–2008 award year. The questions are added for a student (and IC Clearance Official, Regulatory Information FAFSA is completed by students and Management Services, Office of Management. spouse) or a student and parents asking their families and the information whether they received benefits from any Institute of Education Sciences submitted on the form is used to of five means-tested Federal benefit determine the students’ eligibility and Type of Review: Revision of a programs in 2006. Receipt of means- financial need for financial aid under currently approved collection. tested Federal benefits during the the student financial assistance Title: Quick Information Survey preceding calendar year (2006 for the programs authorized under Title IV of 2007–2008 award year) is an alternative System (QRIS) . the Higher Education Act of 1965, as Frequency: Other: One time. to the current question about whether amended (Title IV, HEA Programs). The the student or parent filed or was Affected Public: State, Local, or Tribal Secretary also requests comments on Gov’t, SEAs or LEAs (primary). required to file an IRS 1040 Form as one changes under consideration for the of the criteria used to determine who Reporting and Recordkeeping Hour 2007–2008 award year FAFSA. Burden: qualifies for an automatic zero EFC or a DATES: Interested persons are invited to simplified needs test. (2) A new Responses: 9591. submit comments on or before August 7, dependency question is added to ensure Burden Hours: 7193. 2006. that a member of the U.S. Armed Forces Abstract: The Quick Response ADDRESSES: Comments may be on active duty for other than training Information System consists of two submitted electronically through e-mail purposes is considered an independent survey system components—Fast to: [email protected]. student. (3) The question regarding a Response Survey System for public and Written comments and requests for student’s convictions for drug-related private teachers, schools, districts, copies of the proposed information offenses has been modified. A student is libraries and the Postsecondary collection requests should be addressed ineligible for Title IV, HEA financial Education Quick Information System to U.S. Department of Education, 400 assistance only if the conviction for a (PEQIS) for postsecondary institutions. Maryland Avenue, SW., Potomac Federal or State offense involving the Surveys covered under QRIS are Center, 9th Floor, Washington, DC possession or sale of a controlled intended to be short, one-time, policy- 20202–4700. substance is for conduct that occurred relevant surveys collecting information In addition, interested persons can during a period of enrollment for which that is not available from other sources. access this document on the Internet: the student was receiving Title IV, HEA

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financial assistance. The ineligibility Dated: May 31, 2006. DATE AND TIME: Thursday, June 15, 2006, period is provided in the HEA. (4) New Angela C. Arrington, 10 a.m.–12 Noon. instructions have been added to clarify IC Clearance Official, Regulatory Information PLACE: U.S. Election Assistance that Coverdell savings accounts, 529 Management Services, Office of Management. Commission, 1225 New York Ave., NW., college savings plans, and the refund Federal Student Aid Suite 1100, Washington, DC 20005. value of 529 or State prepaid tuition (Metro Stop: Metro Center). Type of Review: Revision. plans should be reported as an asset of AGENDA: The Commission will receive the account owner (unless the owner is Title: Free Application for Federal presentations on developing a dependent student). (5) In addition, Student Aid (FAFSA). management guidelines for Frequency: Annually. the FAFSA instructs applicants to implementing new voting systems and Affected Public: Individuals and exclude the value of a small business administering elections. The families. that the family owns and controls and Commission will receive reports on Annual Reporting and Recordkeeping other administrative matters. that has 100 or fewer full-time or full- Hour Burden: time equivalent employees. The This meeting will be open to the Responses: 15,400,321. following data elements have been public. Burden Hours: 7,779,593. deleted from the FAFSA because of FOR FURTHER INFORMATION CONTACT: space constraints on the paper form: Abstract: The FAFSA collects Bryan Whitener, Telephone: (202) 566– Questions 27 and 28 regarding the identifying and financial information 3100. student’s interest in student loans or about a student applying for Title IV, HEA program funds. This information is Thomas R. Wilkey, work-study and questions 94–97 used to calculate the student’s expected Executive Director, U.S. Election Assistance representing a fifth and sixth college family contribution, which is used to Commission. choice. Question numbers refer to the determine a student’s financial need. [FR Doc. 06–5181 Filed 6–2–06; 12:58 pm] 2006–2007 FAFSA. The Secretary The information is also used for BILLING CODE 6820–KF–M requests comments on these proposed determining a student’s eligibility for changes to wording, as well as grants and loans under the Title IV, suggestions for ways to further simplify HEA Programs. It is further used for DEPARTMENT OF ENERGY the application for students, parents, determining a student’s eligibility for and schools. In particular, the Secretary State and institutional financial aid Federal Energy Regulatory is interested in comments regarding the programs. Commission best manner in which to construct a Requests for copies of the proposed [Docket No. CP06–277–000] simplified form for applicants who information collection request may be qualify for an automatic zero or accessed from http://edicsweb.ed.gov, CenterPoint Energy Gas Transmission simplified needs test EFC calculation, by selecting the ‘‘Browse Pending Company; Notice of Application including applicants who now qualify Collections’’ link and by clicking on based on receipt of benefits from a link number 03129. When you access May 31, 2006. Federal means-tested benefit program. the information collection, click on Take notice that on May 10, 2006, The Secretary is publishing this request ‘‘Download attachments’’ to view. CenterPoint Energy Gas Transmission for comment under the provisions of the Written requests for information should Company (CEGT), 111 Louisiana Street, Paperwork Reduction Act of 1995, 44 be addressed to U.S. Department of Houston, Texas 77002–5231, filed in U.S.C. 3501 et seq. Under that Act, ED Education, 400 Maryland Avenue, SW., Docket No. CP06–277–000 an must obtain the review and approval of Potomac Center, 9th Floor, Washington, application pursuant to section 7(b) of the Office of Management and Budget DC 20202–4700. Requests may also be the Natural Gas Act (NGA), as amended, (OMB) before it may use a form to e-mailed to [email protected] or for authorization to abandon, in place collect information. However, under faxed to: (202) 245–6623. Please specify and by sale, certain facilities located in procedure for obtaining approval from the complete title of the information Harrison County, Texas and Caddo OMB, ED must first obtain public collection when making your request. Parrish, Louisiana. CEGT further comment of the proposed form, and to Comments regarding burden and/or the requests a finding that certain facilities obtain that comment, ED must publish collection activity requirements should to be sold to Waskom Gas Processing Company (Waskom Gas), would be this notice in the Federal Register. In be directed to [email protected]. exempt from the Commission’s addition to comments requested above, Individuals who use a telecommunications device for the deaf jurisdiction, all as more fully set forth to accommodate the requirements of the (TDD) may call the Federal Relay in the application which is on file with Paperwork Reduction Act, the Secretary Service (FRS) at 1–800–877–8339 the Commission and open to public is interested in receiving comments between 8 a.m. and 8 p.m., Eastern time, inspection. This filing may also be with regard to the following matters: (1) Monday through Friday. viewed on the Commission’s Web site at Is this collection necessary to the proper http://www.ferc.gov using the [FR Doc. E6–8707 Filed 6–5–06; 8:45 am] functions of the Department, (2) will ‘‘eLibrary’’ link. Enter the docket this information be processed and used BILLING CODE 4000–01–P number, excluding the last three digits, in a timely manner, (3) is the estimate in the docket number field to access the of burden accurate, (4) how might the document. For assistance, call (202) Department enhance the quality, utility, ELECTION ASSISTANCE COMMISSION 502–8659 or TTY, (202) 208–3676. and clarity of the information to be Specifically, CEGT proposes to collected, and (5) how might the Sunshine Act; Notice of Meeting abandon its Line F–1–F and Department minimize the burden of this AGENCY: United States Election appurtenant facilities, two compressor collection on the respondents, including Assistance Commission. units located at its Buckley Compressor through the use of information Station. In addition, in conjunction with ACTION: Notice of public meeting. technology. the proposed abandonment of Line F–1–

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F, CEGT proposes to sell an required to serve copies of filed copy of that document on the Applicant. approximately 13 mile segment of Line documents on all other parties. Anyone filing an intervention or protest F–1–F to Waskom Gas to be used to However, the non-party commentors on or before the intervention or protest gather natural gas into Waskom Gas’ will not receive copies of all documents date need not serve motions to intervene plant. filed by other parties or issued by the or protests on persons other than the Any questions regarding this Commission (except for the mailing of Applicant. application should be directed to environmental documents issued by the The Commission encourages Lawrence O. Thomas, Director—Rates & Commission) and will not have the right electronic submission of protests and Regulatory, CenterPoint Energy Gas to seek court review of the interventions in lieu of paper using the Transmission Company, P.O. Box Commission’s final order. ‘‘eFiling’’ link at http://www.ferc.gov. 21734, Shreveport, Louisiana 71151, or The Commission strongly encourages Persons unable to file electronically call (318) 429–2804. electronic filings of comments protests should submit an original and 14 copies There are two ways to become and interventions via the Internet in lieu of the protest or intervention to the involved in the Commission’s review of of paper. See 18 CFR 385.2001(a)(1)(iii) Federal Energy Regulatory Commission, this project. First, any person wishing to and the instructions on the 888 First Street, NE., Washington, DC obtain legal status by becoming a party Commission’s Web (http:// 20426. to the proceedings for this project www.ferc.gov) site under the ‘‘e-Filing’’ This filing is accessible on-line at should, on or before the comment date link. http://www.ferc.gov, using the stated below, file with the Federal Comment Date: June 21, 2006. ‘‘eLibrary’’ link and is available for Energy Regulatory Commission, 888 review in the Commission’s Public Magalie R. Salas, First Street, NE., Washington, DC 20426, Reference Room in Washington, DC. a motion to intervene in accordance Secretary. There is an ‘‘eSubscription’’ link on the with the requirements of the [FR Doc. E6–8746 Filed 6–5–06; 8:45 am] Web site that enables subscribers to Commission’s Rules of Practice and BILLING CODE 6717–01–P receive e-mail notification when a Procedure (18 CFR 385.214 or 385.211) document is added to a subscribed and the Regulations under the NGA (18 docket(s). For assistance with any FERC CFR 157.10). A person obtaining party DEPARTMENT OF ENERGY Online service, please e-mail status will be placed on the service list [email protected], or call maintained by the Secretary of the Federal Energy Regulatory Commission (866) 208–3676 (toll free). For TTY, call Commission and will receive copies of (202) 502–8659. all documents filed by the applicant and [Docket No. RP06–368–000] Comment Date: 5 p.m. Eastern Time by all other parties. A party must submit June 7, 2006. 14 copies of filings made with the El Paso Natural Gas Company; Notice Commission and must mail a copy to of Request for Waivers Magalie R. Salas, the applicant and to every other party in Secretary. May 31, 2006. the proceeding. Only parties to the [FR Doc. E6–8741 Filed 6–5–06; 8:45 am] Take notice that on May 24, 2006, El proceeding can ask for court review of BILLING CODE 6717–01–P Commission orders in the proceeding. Paso Natural Gas Company (EPNG) filed However, a person does not have to proposals to waive the application of intervene in order to have comments Maximum Delivery Obligation and DEPARTMENT OF ENERGY considered. The second way to Maximum Hourly Obligation Violation participate is by filing with the penalties in non-Critical Operating Federal Energy Regulatory Secretary of the Commission, as soon as Conditions should a delivery point Commission operator take gas on a basis not possible, an original and two copies of [Docket No. RP04–360–004] comments in support of or in opposition provided for in its Operator Point to this project. The Commission will Aggregation Service Agreement during Maritimes & Northeast Pipeline, L.L.C.; consider these comments in the months of June and July 2006. EPNG Notice of Compliance Filing determining the appropriate action to be states that it proposes to waive the tariff taken, but the filing of a comment alone provisions applicable to scheduling May 31, 2006. will not serve to make the filer a party transportation service at the contract Take notice that on May 24, 2004, to the proceeding. The Commission’s level so as to continue the use of Maritimes & Northeast Pipeline, L.L.C. rules require that persons filing Scheduling Accounts for the months of (Maritimes) tendered for filing as part of comments in opposition to the project June and July 2006. its FERC Gas Tariff, First Revised provide copies of their protests only to Any person desiring to intervene or to Volume No. 1, the tariff sheets listed on the party or parties directly involved in protest this filing must file in Appendices A, B and C to filing, which the protest. accordance with Rules 211 and 214 of tariff sheets are proposed to be effective Persons who wish to comment only the Commission’s Rules of Practice and on January 1, 2005, October 1, 2005, and on the environmental review of this Procedure (18 CFR 385.211 and June 1, 2006, respectively. project should submit an original and 385.214). Protests will be considered by Any person desiring to protest this two copies of their comments to the the Commission in determining the filing must file in accordance with Rule Secretary of the Commission. appropriate action to be taken, but will 211 of the Commission’s Rules of Environmental commentors will be not serve to make protestants parties to Practice and Procedure (18 CFR placed on the Commission’s the proceeding. Any person wishing to 385.211). Protests to this filing will be environmental mailing list, will receive become a party must file a notice of considered by the Commission in copies of the environmental documents, intervention or motion to intervene, as determining the appropriate action to be and will be notified of meetings appropriate. Such notices, motions, or taken, but will not serve to make associated with the Commission’s protests must be filed in on or before the protestants parties to the proceeding. environmental review process. date as indicated below. Anyone filing Such protests must be filed in Environmental commentors will not be an intervention or protest must serve a accordance with the provisions of

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section 154.210 of the Commission’s System Operator, Inc. filed a refund Standard Paragraph regulations (18 CFR 154.210). Anyone report in compliance with the Any person desiring to intervene or to filing a protest must serve a copy of that Commission’s Orders issued November protest this filing must file in document on all the parties to the 29, 2005 and January 6, 2006. accordance with Rules 211 and 214 of proceeding. Comment Date: 5 p.m. Eastern Time the Commission’s Rules of Practice and The Commission encourages on June 8, 2006. Procedure (18 CFR 385.211, 385.214). electronic submission of protests in lieu Protests will be considered by the 3. MidAmerican Energy Company; of paper using the ‘‘eFiling’’ link at Commission in determining the MidAmerican Energy Company http://www.ferc.gov. Persons unable to appropriate action to be taken, but will file electronically should submit an [Docket Nos. ER96–719–012; ER96–719–014; not serve to make protestants parties to original and 14 copies of the protest to Docket Nos. ER96–719–006; EL05–59–000] the proceeding. Any person wishing to the Federal Energy Regulatory become a party must file a notice of Commission, 888 First Street, NE., On May 19, 2006, MidAmerican Energy Company (MidAmerican) intervention or motion to intervene, as Washington, DC 20426. appropriate. Such notices, motions, or This filing is accessible on-line at submitted for Commission approval in protests must be filed on or before the http://www.ferc.gov, using the Docket Nos. ER96–719–006 and EL05– comment date. On or before the ‘‘eLibrary’’ link and is available for 59–000 an uncontested offer of comment date, it is not necessary to review in the Commission’s Public settlement. According to MidAmerican, serve motions to intervene or protests Reference Room in Washington, DC. the offer of settlement would dispose of on persons other than the Applicant. There is an ‘‘eSubscription’’ link on the all of the pending issues concerning The Commission encourages Web site that enables subscribers to MidAmerican’s Sales Tariff, including electronic submission of protests and receive e-mail notification when a its rates under Schedule A of that tariff. interventions in lieu of paper using the document is added to a subscribed The settlement agreement also ‘‘eFiling’’ link at http://www.ferc.gov. docket(s). For assistance with any FERC constitutes an amendment to the Persons unable to file electronically Online service, please e-mail pending compliance filing submitted by should submit an original and 14 copies [email protected], or call MidAmerican on April 3, 2006 in of the protest or intervention to the (866) 208–3676 (toll free). For TTY, call Docket Nos. ER96–719–012 and ER96– Federal Energy Regulatory Commission, (202) 502–8659. 719–014. 888 First Street, NE., Washington, DC Magalie R. Salas, Comment Date: 5 p.m. Eastern Time 20426. Secretary. on June 12, 2006. This filing is accessible on-line at http://www.ferc.gov, using the [FR Doc. E6–8745 Filed 6–5–06; 8:45 am] 4. The City of Tacoma, a Municipal BILLING CODE 6717–01–P ‘‘eLibrary’’ link and is available for Electric Utility of the State of review in the Commission’s Public Washington, and the City of Seattle, a Reference Room in Washington, DC. Municipal Electric Utility of the State of DEPARTMENT OF ENERGY There is an ‘‘eSubscription’’ link on the Washington, v. South Columbia Basin Web site that enables subscribers to Federal Energy Regulatory Irrigation District, an Electric Utility of receive e-mail notification when a Commission the State of Washington, East Columbia document is added to a subscribed Basin Irrigation District, an Electric [Docket Nos. EC06–46–000, et al.] docket(s). For assistance with any FERC Utility of the State of Washington, Online service, please e-mail Quincy Columbia Basin Irrigation [email protected], or call Aquila, Inc., et al.; Electric Rate and District, an Electric Utility of the State Corporate Filings (866) 208–3676 (toll free). For TTY, call of Washington, and Grand Coulee (202) 502–8659. May 30, 2006. Project Hydroelectric Authority, an The following filings have been made Electric Utility of the State of Magalie R. Salas, with the Commission. The filings are Washington Secretary. listed in ascending order within each [Docket No. TX06–3–000] [FR Doc. E6–8734 Filed 6–5–06; 8:45 am] docket classification. BILLING CODE 6717–01–P Take notice that on May 18, 2006, the 1. Aquila, Inc.; Mid-Kansas Electric City of Tacoma, Washington, Company, LLC Department of Utilities, Light Division, DEPARTMENT OF ENERGY [Docket No. EC06–46–000] dba Tacoma Power and the City of Federal Energy Regulatory Take notice that on March 21, 2006, Seattle, Washington, City Light Commission Aquila, Inc. (Aquila) tendered for filing Department (the cities) filed an copies of the proposed accounting application for Commission Order Directing Interconnections of South Notice of Application for Non-Project entries for the transfer of certain Use of Project Lands and Soliciting facilities from Aquila to Mid-Kansas Columbia Basin Irrigation District, The East Columbia Irrigation District, Comments, Motions To Intervene, and Electric Company, LLC under section Protests 203 of the Federal Power Act. Quincy Columbia Basin Irrigation Comment Date: 5 p.m. Eastern Time District, and Grand Coulee Project May 31, 2006. on June 9, 2006. Hydroelectric Authority to their Main Take notice that the following Canal and Summer Falls hydroelectric 2. DTE Energy Trading, Inc. v. Midwest hydroelectric application has been filed project facilities, pursuant to sections with the Commission and is available Independent Transmission System 210 and 212 of the Federal Power Act. Operator, Inc. for public inspection: The cities also request expedited a. Application Type: Non-project use [Docket No. EL05–63–004] consideration and waiver of fees. of project lands and waters. Take notice that on May 18, 2006, Comment Date: 5 p.m. Eastern Time b. Project No.: 2468–191. Midwest Independent Transmission on June 19, 2006. c. Date Filed: May 10, 2006.

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d. Applicant: Consumers Energy comments, a protest, or a motion to developing the public record in Company (Consumers). intervene in accordance with the anticipation of Commission action on e. Name of Project: Croton. requirements of Rules of Practice and NERC’s April 4, 2006 petition for f. Location: The project is located on Procedure, 18 CFR 385.210, .211, .214. approval of reliability standards. Muskegon River in Newaygo County, In determining the appropriate action to Take notice that the Federal Energy Cadillac, Michigan. The project does not take, the Commission will consider all Regulatory Commission will hold a occupy any Federal or tribal lands. protests or other comments filed, but Technical Conference to consider g. Filed Pursuant to: Federal Power only those who file a motion to Act 16 U.S.C. 791(a)–825(r). NERC’s April 4, 2006 petition and to intervene in accordance with the address issues raised in the Staff h. Applicant Contact: Robert Commission’s Rules may become a Neustifter, Consumers Energy Company, Assessment. This Technical Conference party to the proceeding. Any comments, will be held on July 6, 2006, in the One Energy Plaza, Jackson, MI 49201. protests, or motions to intervene must Phone: (517) 788–2974. offices of the Commission, 888 First be received on or before the specified Street, NE., Washington, DC, from i. FERC Contact: Gina Krump, comment date for the particular approximately 9 a.m. until [email protected], 202–502–6704. application. approximately 4 p.m. (EST). This j. Deadline for filing comments and or o. Filing and Service of Responsive conference will be held in the motions: June 30, 2006. Documents: Any filings must bear in all All documents (original and eight Commission Meeting Room on the capital letters the title ‘‘COMMENTS’’, copies) should be filed with Ms. Magalie ‘‘RECOMMENDATIONS FOR TERMS second floor of the Commission. All R. Salas, Secretary, Federal Energy AND CONDITIONS’’, ‘‘PROTEST’’, OR interested persons may attend, and Regulatory Commission, 888 First ‘‘MOTION TO INTERVENE’’, as registration is not required. This will be Street, NE., Washington, DC 20426. applicable, and the Project Number of a staff conference, but Commissioners Comments, protests, and interventions the particular application to which the may attend. may be filed electronically via the filing refers. Any of the above-named Transcripts of the conference will be Internet in lieu of paper. See, 18 CFR documents must be filed by providing immediately available from Ace 385.2001(a)(1)(iii) and the instructions the original and the number of copies Reporting Company (202–347–3700 or on the Commission’s Web site under the provided by the Commission’s 1–800–336–6646) for a fee. They will be ‘‘e-Filing’’ link. Please reference ‘‘Croton regulations to: The Secretary, Federal available for the public on the Hydroelectric Project, FERC Project No. Energy Regulatory Commission, 888 Commission’s eLibrary system and the 2468–191’’ on any comments or motions First Street NE., Washington, DC 20426. calendar posting for this event seven filed. A copy of any motion to intervene must calendar days after the Commission k. Description of the Application: also be served upon each representative receives the transcript. Consumers requests Commission of the Applicant specified in the approval to permit the dredging of A free webcast of this event is particular application. sediment, and the excavation of a available through http://www.ferc.gov. p. Agency Comments: Federal, state, sediment trap in the Little Muskegon Anyone with Internet access who and local agencies are invited to file River arm of Croton reservoir. desires to view this event can do so by comments on the described application. Specifically, the proposed dredging navigating to http://www.ferc.gov’s A copy of the application may be would cover an underneath area of Calendar of Events and locating this obtained by agencies directly from the approximately 1,300 feet (ft) x 48 ft, and event in the Calendar. The event will Applicant. If an agency does not file the proposed excavation area would contain a link to its webcast. The comments within the time specified for cover an underwater 300 ft x 50 ft the Capitol Connection provides technical filing comments, it will be presumed to excavated sediment trap would be 8 ft support for the webcasts; and offers have no comments. One copy of an deep. The submerged land involved in access to the open meetings via agency’s comments must also be sent to the dredging/excavation proposal is television in the DC area and via phone the Applicant’s representatives. owned in fee by Consumers. bridge for a fee. If you have any l. Locations of the Application: This Magalie R. Salas, questions, visit http:// filing is available for review at the Secretary. www.CapitolConnection.org or contact Commission in the Public Reference [FR Doc. E6–8743 Filed 6–5–06; 8:45 am] Danelle Perkowski or David Reininger at Room or may be viewed on the BILLING CODE 6717–01–P 703–993–3100. Commission’s Web site at http:// Commission conferences are www.ferc.gov using the ‘‘E-library’’ link. accessible under section 508 of the Enter the docket number excluding the DEPARTMENT OF ENERGY Rehabilitation Act of 1973. For last three digits in the docket number accessibility accommodations please Federal Energy Regulatory field to access the document. For send an e-mail to [email protected] Commission assistance, please contact FERC Online or call toll free 866–208–3372 (voice) or Support at [Docket No. RM06–16–000] 202–208–1659 (TTY), or send a FAX to [email protected] or toll- 202–208–2106 with the required free at (866) 208–3676, or for TTY, Mandatory Reliability Standards for the accommodations. contact (202) 502–8659. A copy is also Bulk-Power System; Notice of available for inspection and Technical Conference For more information about the reproduction at the address in item (h) conference, please contact Sarah above. May 31, 2006. McKinley at (202) 502–8004 m. Individuals desiring to be included On May 11, 2006, the Commission ([email protected]). on the Commission’s mailing list should released a Staff Assessment of the North Magalie R. Salas, so indicate by writing to the Secretary American Electric Reliability Council’s of the Commission. (NERC) current reliability standards. Secretary. n. Comments, Protests, or Motions to The Staff Assessment is a preliminary [FR Doc. E6–8744 Filed 6–5–06; 8:45 am] Intervene: Anyone may submit evaluation intended to assist in BILLING CODE 6717–01–P

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DEPARTMENT OF ENERGY state implementation plans (SIPs) as of submit an electronic comment, we September 1, 2004, under section recommend that you include your name Federal Energy Regulatory 211(c)(4)(C) of the Clean Air Act (CAA). and other contact information in the Commission The EPAct also requires us to publish a body of your comment and with any [Docket Nos. ER06–301–000; ER06–301– list of such fuels, including the states disk or CD you submit. If we cannot 001] and Petroleum Administration for read your comment due to technical Defense District (PADD) in which they difficulties and cannot contact you for Xcel Energy Services, Inc.; Notice of are used for public review and clarification, we may not be able to Technical Conference comment. Today we are publishing the consider your comment. Electronic files draft list along with an explanation of should avoid the use of special May 31, 2006. our rationale in developing it. The list characters, should not use any form of Take notice that the Commission will consists of seven different types of SIP encryption, and should be free of any convene a technical conference on boutique fuels. defects or viruses. For additional Monday, June 12, 2006, at 10 a.m. (EST), DATES: Comments must be received on information about our public docket in a room to be designated at the offices or before August 7, 2006. visit the EPA Docket Center homepage of the Federal Energy Regulatory ADDRESSES: at http://www.epa.gov/epahome/ Commission, 888 First Street, NE., Submit your comments, identified by Docket ID No. EPA–HQ– dockets.htm. For additional instructions Washington DC 20426. on submitting comments, go to Section The technical conference will explore OAR–2006–0340, by one of the following methods: I of the SUPPLEMENTARY INFORMATION the issues raised by Xcel Energy • section of this document. Services, Inc.’s proposed Services H and http://www.regulations.gov: Follow the on-line instructions for submitting Docket: All documents in the docket I, as discussed in the Commission’s are listed in the http:// order issued on May 5, 2006.1 Those comments. • E-mail: [email protected]. www.regulations.gov index. Although issues include why the transfer price • Fax: (202) 566–1741, Attention listed in the index, some information is proposed in Service Schedule H is Docket ID No. EPA–HQ–OAR–2006– not publicly available, e.g., CBI or other different from the transfer price 0340. information for which disclosure is proposed in Service Schedule I, and • Mail: Air Docket, Attention Docket restricted by statute. Certain other why Xcel needs both service schedules. ID No. EPA–HQ–OAR–2006–0340, material, such as copyrighted material, FERC conferences are accessible Environmental Protection Agency, will be publicly available only in hard under section 508 of the Rehabilitation Mailcode: 6102T, 1200 Pennsylvania copy. Publicly available docket Act of 1973. For accessibility Ave., NW., Washington, DC 20460. materials are available either accommodations please send an e-mail • Hand Delivery: USEPA, Air Docket, electronically in http:// to [email protected] or call toll free 1301 Constitution Ave, NW., Room www.regulations.gov or in hard copy at (866) 208–3372 (voice) or 202–208–1659 B102, Washington, DC 20004, Attention the Air Docket, EPA/DC, EPA West, (TTY), or send a FAX to 202–208–2106 Docket ID No. EPA–HQ–OAR–2006– Room B102, 1301 Constitution Ave., with the required accommodations. 0340. Such deliveries are only accepted NW., Washington, DC. The Public All interested persons are permitted during the Docket’s normal hours of Reading Room is open from 8:30 a.m. to to attend. For further information please operation, and special arrangements 4:30 p.m., Monday through Friday, contact Donna Brent at (202) 502–6646 should be made for deliveries of boxed excluding legal holidays. The telephone or e-mail [email protected]. information. number for the Public Reading Room is Magalie R. Salas, Instructions: Direct your comments to (202) 566–1744, and the telephone number for the Air Docket is (202) 566– Secretary. Docket ID No. EPA–HQ–OAR–2006– 1742. [FR Doc. E6–8742 Filed 6–5–06; 8:45 am] 0340. Our policy is that all comments FOR FURTHER INFORMATION CONTACT: BILLING CODE 6717–01–P received will be included in the public docket without change and may be Anne Pastorkovich, Environmental made available online at http:// Protection Agency, MC 6406J, 1200 www.regulations.gov, including any Pennsylvania Ave., NW., Washington, ENVIRONMENTAL PROTECTION DC 20460; telephone number: 202–343– AGENCY personal information provided, unless the comment includes information 9623; fax number: 202–343–2801; e-mail [EPA–HQ–OAR–2006–0340; FRL–8180–3] claimed to be confidential business address: pastorkovich.anne- information (CBI) or other information [email protected]. Draft Boutique Fuels List Under for which disclosure is restricted by SUPPLEMENTARY INFORMATION: Section 1541(b) of the Energy Policy statute. Do not submit information that Act and Request for Public Comment you consider to be CBI or otherwise I. What Should I Consider as I Prepare My Comments for EPA? AGENCY: Environmental Protection protected through http:// Agency (EPA). www.regulations.gov. The http:// 1. Submitting CBI. Do not submit CBI www.regulations.gov Web site is an to us through http:// ACTION: Notice. ‘‘anonymous access’’ system, which www.regulations.gov or e-mail. Clearly SUMMARY: The Energy Policy Act of 2005 means we will not know your identity mark the part or all of the information includes a number of provisions or contact information unless you that you claim to be CBI. For CBI addressing the issue of boutique fuels. provide it in the body of your comment. information in a disk or CD that you Section 1541(b) of this Act requires If you send an e-mail comment directly mail to EPA, mark the outside of the EPA, in consultation with the to us without going through http:// disk or CD as CBI and then identify Department of Energy, to determine the www.regulations.gov, your e-mail electronically within the disk or CD the total number of fuels approved into all address will be automatically captured specific information that is claimed as and included as part of the comment CBI. In addition to one complete version 1 Xcel Energy Services, Inc., 115 FERC ¶ 61,148 that is placed in the public docket and of the comment that includes (2006). made available on the internet. If you information claimed as CBI, a copy of

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the comment that does not contain the programs are often referred to as resulting draft list of these fuels. We information claimed as CBI must be ‘‘boutique’’ fuels programs because they invite comment on all of these matters submitted for inclusion in the public differ from the Federal fuel required in and after evaluating all comments we docket. Information so marked will not the area, and have been adopted by the will issue a final list. be disclosed except in accordance with state to address a specific local air B. Fuel Type Versus State Specific procedures set forth in 40 CFR part 2. quality issue. The issue presented by Interpretation and Our Recommended 2. Tips for Preparing Your Comments. boutique fuels is that when events (such Approach When submitting comments, remember as hurricanes or pipeline and refinery to: breakdowns) lead to fuel supply The first step in determining the total • Identify the rule or notice by docket shortages, varying fuel standards can number of fuels approved under section number and other identifying complicate the process of quickly 211(c)(4)(C) is to interpret what is meant information (subject heading, Federal solving the problem. The Energy Policy by the term ‘‘total number of fuels.’’ The Register date and page number). EPAct does not define this term, and the • Act of 2005 (EPAct) amends the CAA Follow directions—The agency may and places three additional restrictions legislative history is relatively limited ask you to respond to specific questions on our authority to waive preemption by and does not resolve what Congress or organize comments by referencing a approving a state fuel into the SIP. meant. We believe that the central term Code of Federal Regulations (CFR) part These restrictions are: ‘‘total number of fuels’’ is ambiguous or section number. • and could potentially be interpreted in • First, we may not approve a state Explain why you agree or disagree; fuel program into the SIP if it would one of two basic ways: suggest alternatives and substitute cause an increase in the ‘‘total number • Fuel Type Interpretation—Each language for your requested changes. of fuels’’ approved into SIPs as of type or kind of fuel could be considered • Describe any assumptions and September 1, 2004.4 To implement this a separate fuel, without respect to the provide any technical information and/ provision, we are required to determine number of different state or data that you used. implementation plans that include such • If you estimate potential costs or the total number of fuels approved as of that date and to publish a list fuel. For example, all state fuels with a burdens, explain how you arrived at Reid Vapor Pressure8 of 7.8 pounds per your estimate in sufficient detail to identifying the fuels, including the square inch (psi) could be considered allow for it to be reproduced. states and PADD in which they are one fuel in determining the total • Provide specific examples to used. We may remove a fuel from the illustrate your concerns, and suggest list if it ceases to be included in the SIP, number of fuels approved as of alternatives. or if it is identical to a Federal fuel September 1, 2004. While several states • Explain your views as clearly as control. This removal does not reduce had a 7.8 psi RVP program on that date, possible, avoiding the use of profanity the total number of fuels authorized they would not be treated as different or personal threats. under the list, but in effect ‘‘makes fuels in determining the ‘‘total number • Make sure to submit your room’’ for potential approval of state of fuels,’’ but as different states using a comments by the comment period fuel programs that were not on the list single fuel type. For ease of reference deadline identified. as of September 1, 2004.5 this will be called ‘‘the fuel type 3. Docket Copying Costs. You may be • Second, in cases where our interpretation.’’ This would result in charged a reasonable fee for approval would not increase the total seven (7) different fuel types. photocopying docket materials, as number of fuels on the list because the • State Specific Interpretation—As an provided by 40 CFR part 2. total number of fuels in SIPs at that alternative to the ‘‘fuel type point is below the number of fuels as of interpretation,’’ each individual state II. Publication of the Boutique Fuels the September 1, 2004, then our using a type or kind of fuel in a SIP List approval requires a finding that the new could be considered a separate fuel. For A. Background fuel will not cause supply or example, each state having 7.8 psi RVP in its SIP could be treated as having a Under the Clean Air Act (CAA),1 state distribution problems or have separate fuel for purposes of fuel programs respecting a fuel significant adverse impacts on fuel characteristic or component that we producibility in the affected or determining the ‘‘total number of fuels.’’ contiguous areas.6 For ease of reference, this will be called have regulated under section 211(c)(1) • are preempted. EPA may waive Third, we may not approve a state ‘‘the state specific interpretation.’’ The preemption through approval of the fuel fuel unless that fuel is already approved state specific interpretation would lead program into a State Implementation in at least one SIP in the applicable to as many fuels as there are state fuel Plan (SIP). Approval into the SIP PADD.7 programs in the various PADDs and requires a demonstration that the state In this Federal Register notice, we would result in 15 different fuels. fuel program is necessary to achieve the provide our provisional interpretation of The two interpretations would lead to National Ambient Air Quality Standards the EPAct provisions and our different results when considering (NAAQS)2 that the plan implements. determination of the total number of approval of future state fuel programs. ‘‘Necessary’’ means that no other fuels approved under CAA section For example, under the fuel type measures exist that would bring about 211(c)(4)(C) as of September 1, 2004, interpretation, a state RVP program of timely attainment or that other measures based on this interpretation, and the 7.8 or 7.2 psi could generally be exist and are technically possible to approved under the EPAct provisions, implement, but are unreasonable or 4 See CAA section 211(c)(4)(C)(v)(I), 42 U.S.C. as long as that same RVP program was 7545(c)(4)(C)(v)(I). impracticable.3 These state fuels already in a SIP within that PADD. 5 See CAA section 211(c)(4)(C)(v)(II)–(III), 42 Under the fuel type interpretation, U.S.C. 7545(c)(4)(C)(v)(II)–(III). approval of that state RVP program 1 See CAA section 211(c)(1), 42 U.S.C. 7545(c)(1). 6 See CAA section 211(c)(4)(C)(v)(IV), 42 U.S.C. 2 NAAQS are standards for ambient levels of 7545(c)(4)(C)(v)(IV). would not increase the total number of certain air pollutants (e.g. ground-level ozone) and 7 See CAA section 211(c)(4)(C)(v)(V), 42 U.S.C. are designed to protect public health and welfare. 7545(c)(4)(C)(v)(V). As discussed later in this 8 Reid Vapor Pressure is the common measure of 3 See CAA section 211(c)(4)(C)(i), 42 U.S.C. notice, there is an exception to the PADD restriction fuel volatility. Volatility is the tendency of fuel to 7545(c)(4)(C)(i). for a 7.0 psi RVP program. evaporate.

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approved fuels because that type of RVP of fuels approved into SIPs as of fuel’’ had already been approved into program is already on the list. It would September 2004, identifying usage by another state’s SIP. In that context, ‘‘that expand the number of states using that state and PADD.11 Under the state fuel’’ would have to refer to the type of fuel type, but would not increase the specific fuel interpretation, the fuel, not the state specific fuel, as the number of fuel types. However, under requirement to ‘‘includ[e] the states state specific fuel could not be already the state specific fuel interpretation, the * * * in which they are used’’ in the approved into another state’s SIP. Under same state RVP program could not be published list of fuels would appear to the fuel type interpretation, this approved unless some other state fuel be redundant, as under that provision requires that at least one SIP program had been removed from the interpretation the identification of the in the PADD already have a program for list, in effect ‘‘making room’’ for the fuel is by definition state specific. that fuel type.16 newer program. Under the fuel type interpretation, the We believe that the EPAct boutique EPA recognizes that a few states had requirement to provide usage by state fuels provisions are ambiguous and are a 9.0 psi RVP fuel program in their SIP and PADD is logically included for susceptible to two plausible as of September 1, 2004. We do not informational purposes. interpretations. However, the fuel type believe that state RVP programs that We must remove a fuel from the interpretation appropriately balances require 9.0 psi should be included in published list if the fuel is removed the concerns at the heart of the EPAct the boutique fuels list required by from ‘‘a [SIP]’’ or if ‘‘a fuel in a [SIP]’’ provision by preserving some flexibility EPAct. Beginning in 1989, we set RVP is identical to a federal fuel.12 Under the for states to adopt state fuel programs standards under CAA section 211(c) for state specific interpretation, the use of that can be useful in attaining the gasoline sold during the summertime, in the word ‘‘a’’ would mean that NAAQS, while limiting the potential for two phases (Phase I and II). Generally, modification of a single SIP program fuel supply and distribution concerns under Phase I, which was effective in would affect the list of fuels, regardless by controlling the growth in state the summer of 1989, we set the RVP of fuel type. Under the fuel type boutique fuel programs.17 We recognize level at 10.5 psi in the northern states, interpretation, ‘‘a [SIP]’’would have to that the PADD restriction 18 places a and under Phase II, which was effective be read to mean all SIPs. A fuel type strong constraint on future approval of in the summer of 1992, we set RVP would be removed from the list only if state specific fuels under either levels at 9.0 psi in the northern states. it was removed from all SIPs with that interpretation because it effectively Between 1989 and 1992, we also type of fuel program. limits state fuels to the types currently approved state 9.0 psi RVP fuel The EPAct refers to a ‘‘new fuel.’’ 13 in existence and to the PADDs in which programs into the SIPs for several Specifically, it provides that before they are currently found. For a state fuel northeastern states, under CAA section approving a ‘‘new fuel’’ into a SIP, program to be approved into a SIP in the 211(c)(4)(C). These fuel programs where there is room on the list for future, the fuel type must have been continue to be included in the state additional fuels, we must make a approved into a SIP in that PADD as of SIPs. As earlier mentioned, the EPAct finding concerning impact on fuel September 1, 2004 (with the one requires that we publish a list based on supply, distribution, and producibility. exception for 7.0 psi RVP programs). the total number of fuels approved into Under the state specific fuel Under the fuel type interpretation, states SIPs under section 211(c)(4)(C) as of interpretation, a ‘‘new fuel’’ would be a could generally adopt fuels programs September 1, 2004.9 We are also new state specific fuel that EPA has not but only in those limited cases where required to remove a fuel from the already approved into a SIP. Under the that fuel type is already found in their published list if the fuel is ‘‘identical to fuel type interpretation, the term ‘‘new PADD. This addresses the ‘‘fuel islands’’ a Federal fuel formulation implemented fuel’’ is problematic. A new fuel type concerns, while preserving an important by the Administrator.’’10 Because the would be a fuel type that is not already degree of state flexibility in developing current Federal RVP requirement in all on the list. However, the PADD a state’s air pollution control program. of these northeastern states is 9.0 psi restriction14 would already preclude the Under the state specific interpretation RVP, reading these provisions literally approval of a new fuel type, because a there is little, if any, opportunity for a would require EPA to include 9.0 psi new fuel type would not already be state to adopt a fuel program in the RVP on the list but to remove it from the approved into a SIP in a PADD. There future. This is because, in addition to list at the same time. We believe, is, however, an exception to the PADD the PADD restriction, some other state’s however, that Congress would not have restriction, for a 7.0 psi RVP program, fuel program would have to be removed intended this somewhat illogical such that there are limited from the list to make room for addition approach, and we also do not believe circumstances that would give meaning of the new state fuel program. that 9.0 psi RVP would be viewed as to the term ‘‘new fuel’’ under the fuel We believe the fuel type contributing to the proliferation of ‘‘fuel type interpretation. interpretation is the more appropriate of islands’’ that Congress was concerned The EPAct constrains our approval of the two interpretations from the about in enacting this new provision. ‘‘any fuel unless that fuel’’ was already standpoint of state flexibility in We believe the appropriate way to approved into at least one SIP in the establishing air pollution control reconcile these apparently conflicting applicable PADD.15 Under the state programs. Our suggested interpretation provisions are not to include the current specific fuel interpretation, a state fuel would also strictly limit the burden of state 9.0 psi RVP programs on the list. could not be approved unless ‘‘that new state fuel programs upon regulated In evaluating these two interpretations, we also looked to the 11 See CAA section 211(c)(4)(C)(v)(II), 42 U.S.C. 16 As noted above, Congress exempted 7.0 psi EPAct provisions related to the boutique 7545(c)(4)(C)(v)(II). RVP programs from this PADD restriction. While 12 fuels list. The EPAct requires that we See CAA section 211(c)(4)(C)(v)(III), 42 U.S.C. the other EPAct provisions on boutique fuels do 7545(c)(4)(C)(v)(III). apply to 7.0 psi RVP programs, the specific publish a list based on the total number 13 See CAA section 211(c)(4)(C)(v)(IV), 42 U.S.C. limitation on PADD usage in section 7545(c)(4)(C)(v)(IV). 211(c)(4)(C)(v)(V) does not apply. This is the case 9 See CAA section 211(c)(4)(C)(v)(II), 42 U.S.C. 14 See CAA section 211(c)(4)(C)(v)(V), 42 U.S.C. under either interpretation. 7545(c)(4)(C)(v)(II). 7545(c)(4)(C)(v)(V). 17 See 51 Cong. Rec. H6949–01, 6968–6969. 10 See CAA section 211(c)(4)(C)(v)(III), 42 U.S.C. 15 See CAA section 211(c)(4)(C)(v)(V), 42 U.S.C. 18 See CAA section 211(c)(4)(C)(v)(V), 42 U.S.C. 7545(c)(4)(C)(v)(III). 7545(c)(4)(C)(v)(V). 7545(c)(4)(C)(v)(V).

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industry, including small businesses. burdens on all parties in the fuel types, as described in the following The fuel type interpretation, combined production and distribution system, section. with the PADD restriction, clearly limits whether large entities or small entities. C. Draft Boutique Fuel List the introduction of new boutique fuels, We believe that issuing this list will avoiding future pressure on the have no adverse impact on any such A list of the seven (7) fuel types production, distribution and storage of parties. approved into SIPs under section fuels, including small entities involved 211(c)(4)(C) as of September 1, 2004, the For the reasons described above, we in those industries. We believe that states, and the PADD they are used in issuing this list will reduce future are issuing a draft list of seven (7) fuel is set forth in the following Table:

TOTAL NUMBER OF FUELS APPROVED IN STATE IMPLEMENTATION PLANS (SIPS) UNDER CAA SECTION 211(C)(4)(C) AS OF SEPTEMBER 1, 2004 [Draft based upon fuel type interpretation]

Type of fuel control PADD Region—state

RVP of 7.8 psi ...... 1 1—ME (May 1–Sept. 15). 1 3—PA 2 5—IN 2 5—MI 3 6—TX (May 1–Oct. 1) RVP of 7.2 psi ...... 2 5—IL RVP of 7.0 psi ...... 2 7—KS 2 7—MO 3 4—AL 3 6—TX 5 9—AZ (June 1–Sept. 30). RVP of 7.0 psi with sulfur provisions ...... 1 4—GA Low Emission Diesel ...... 3 6—TX Cleaner Burning Gasoline ...... 5 9—AZ Winter Gasoline (aromatics & sulfur) ...... 5 9—NV

We would use this recommended list included in any SIP or if it became type. EPA’s approval of a 7.0 psi RVP in implementing the three EPAct criteria identical to a Federal fuel. Removal of program would, however, be subject to for approval of a state fuel into a SIP. a fuel type from the list, however, the other EPAct provisions. Specifically: would not change or impact the total We are not recommending a state • We could not approve a state fuel 20 number of fuel types authorized. specific interpretation, as explained if it would cause an increase in the total Our authority to approve a state fuel above. However, we have generated the number of fuel types on the list.19 is limited to fuel types that are already • We would remove a fuel from the in a SIP in that PADD.21 This restriction following table to illustrate the list list if that fuel type either ceased to be would not extend to the 7.0 psi RVP fuel under that alternative:

TOTAL NUMBER OF FUELS APPROVED IN STATE IMPLEMENTATION PLANS (SIPS) UNDER CAA SECTION 211(C)(4)(C) AS OF SEPTEMBER 1, 2004 ALTERNATE APPROACH [Draft based upon state specific interpretation]

Type of fuel control PADD Area/state

RVP of 7.0 psi ...... 2 Kansas City, MO (3 counties). RVP of 7.0 psi ...... 2 Kansas City, KS (2 counties). RVP of 7.0 psi ...... 3 El Paso, TX (El Paso County). RVP of 7.0; extended summer season from June 1 to September 5 Phoenix, AZ (Maricopa County). 30. RVP** of 7.0 psi; includes a provision addressing sulfur content .... 1 Atlanta, GA (45 county area). RVP of 7.0 psi; sulfur content and crediting provision expired in 3 Birmingham, AL (2 counties). 2004, when overtaken by Federal Tier 2 limit. RVP of 7.2 psi ...... 2 E. St. Louis, IL (3 counties near St. Louis, MO). RVP of 7.8 psi ...... 1 Pittsburgh, PA (7 county area). RVP of 7.8 psi ...... 2 Clark & Floyd, IN (2 counties near Louisville, KY). RVP of 7.8 psi ...... 2 Detroit, MI (7 counties). RVP of 7.8 psi; extended summer season from May 1 to Sep- 1 Southern, ME (7 county area). tember 15. RVP of 7.8; extended summer season from May 1 to October 1 ... 3 Central & Eastern, TX (95 county area). Low emission diesel fuel with maximum 10% volume aromatic hy- 3 Houston & Dallas, TX. drocarbon content and minimum cetane of 48 required. (Allows substitute Plans w/equivalent NOX reductions). Cleaner Burning Gasoline; similar to Federal RFG or California 5 Phoenix, AZ (Maricopa County). RFG in summer; in winter similar only to California RFG.

19 See CAA section 211(c)(4)(C)(v)(I), 42 U.S.C. 20 See CAA section 211(c)(4)(C)(v)(III), 42 U.S.C. 21 See CAA section 211(c)(4)(C)(v)(V), 42 U.S.C. 7545(c)(4)(C)(v)(I). 7545(c)(4)(C)(v)(III). 7545(c)(4)(C)(v)(V) and footnote 14.

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TOTAL NUMBER OF FUELS APPROVED IN STATE IMPLEMENTATION PLANS (SIPS) UNDER CAA SECTION 211(C)(4)(C) AS OF SEPTEMBER 1, 2004 ALTERNATE APPROACH—Continued [Draft based upon state specific interpretation]

Type of fuel control PADD Area/state

Winter gasoline controls on aromatic hydrocarbons and sulfur ...... 5 Las Vegas, NV.

We invite comment on all elements of (202) 233–0060; e-mail range of representatives from diverse this notice, especially with regard to the [email protected]. constituencies. recommended and alternate lists and Nominees will also be considered SUPPLEMENTARY INFORMATION: The our interpretation of the relevant with regard to the mandates of the National Advisory Committee and the provisions of the EPAct. Interested Federal Advisory Committee Act that Governmental Advisory Committee parties should submit comments require the Committees to maintain advise the EPA Administrator in his according to the guidelines described at diversity across a broad range of capacity as the U.S. Representative to the beginning of this notice. After fully constituencies, sectors, and groups. the CEC Council. The Committees are considering comments received, we will Nominations for membership must authorized under Articles 17 and 18 of generate and publish a final list in the include a cover letter and a resume the North American Agreement on Federal Register. describing the professional and Environmental Cooperation (NAAEC), educational qualifications of the Dated: May 31, 2006. the North American Free Trade nominee and the nominee’s current Stephen L. Johnson, Agreement (NAFTA) Implementation business address and daytime telephone Administrator. Act, Public Law 103–182, and as number. [FR Doc. E6–8726 Filed 6–5–06; 8:45 am] directed by Executive Order 12915, Dated: May 16, 2006. BILLING CODE 6560–50–P entitled ‘‘Federal Implementation of the North American Agreement on Oscar Carrillo, Environmental Cooperation.’’ The Designated Federal Officer. ENVIRONMENTAL PROTECTION Committees are responsible for [FR Doc. E6–8724 Filed 6–5–06; 8:45 am] AGENCY providing advice to the United States BILLING CODE 6560–50–P Representative on a wide range of [FRL–8180–5] strategic, scientific, technological, Request for Nominations to the regulatory and economic issues related ENVIRONMENTAL PROTECTION National and Governmental Advisory to implementation and further AGENCY elaboration of the (NAAEC). The Committees to the U.S. Representative [EPA–HQ–ORD–2006–0384; FRL–8081–6] to the Commission for Environmental National Advisory Committee consists Cooperation of 12 representatives from environmental groups and non-profit Human Studies Review Board; Notice of Public Meeting AGENCY: Environmental Protection entities, business and industry, and Agency (EPA). educational institutions. The AGENCY: Environmental Protection ACTION: Notice of request for Governmental Advisory Committee Agency (EPA). consists of 12 representatives from state, nominations. ACTION: Notice. local, and tribal governments. Members SUMMARY: The U.S. Environmental are appointed by the EPA Administrator SUMMARY: The U.S. Environmental Protection Agency (EPA) is inviting for a two-year term with the possibility Protection Agency’s (EPA or Agency) nominations of qualified candidates to of reappointment. The Committees Office of the Science Advisor (OSA) be considered for appointment to fill usually meet 3 times annually and the announces a public meeting of the vacancies on the National Advisory average workload for Committee Human Studies Review Board (HSRB) to Committee (NAC) and the Governmental members is approximately 10 to 15 advise the Agency on EPA’s scientific Advisory Committee (GAC) to the U.S. hours per month. Members serve on the and ethical reviews of human subjects’ Representative to the Commission for Committees in a voluntary capacity. research. Environmental Cooperation (CEC). However, EPA provides reimbursement DATES: The public meeting will be held Vacancies on these two committees are for travel expenses associated with June 28–30, 2006 from 8:30 a.m. to expected to be filled by November, so official government business. The approximately 5 p.m., eastern time. we encourage nominations to be following criteria will be used to Location: One Potomac Yard, 2777 submitted by July 14, 2006. evaluate nominees: Crystal Drive, Arlington, VA 22202. • ADDRESSES: Submit nominations to: Extensive professional knowledge Meeting Access: Seating at the Oscar Carrillo, Designated Federal of the subjects the Committees examine, meeting will be on a first-come basis. Officer, Office of Cooperative including trade and the environment, Individuals requiring special Environmental Management, U.S. the NAFTA, the NAAEC, and the CEC. accommodations at this meeting, Environmental Protection Agency • Represent a sector or group that is including wheelchair access and (1601–E), 1200 Pennsylvania Avenue, involved in the issues the Committees assistance for the hearing impaired, NW., Washington, DC 20004. evaluate. should contact the Designated Federal FOR FURTHER INFORMATION CONTACT: • Senior-level experience that fills a Officer (DFO) at least 10 business days Oscar Carrillo, Designated Federal need on the Committees for their prior to the meeting using the Officer, U.S. Environmental Protection particular expertise. information under FOR FURTHER Agency (1601–E), Washington, DC • A demonstrated ability to work in a INFORMATION CONTACT so that 20004; telephone (202) 233–0072; fax consensus building process with a wide appropriate arrangements can be made.

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Procedures for Providing Public Input: made available on the Internet. If you EPA’s position paper(s), charge/ Interested members of the public may submit an electronic comment, EPA questions to the HSRB, and the meeting submit relevant written or oral recommends that you include your agenda will be available by mid June comments for the HSRB to consider name and other contact information in 2006. In addition, the Agency may during the advisory process. Additional the body of your comment and with any provide additional background information concerning submission of disk or CD–ROM you submit. If EPA documents as the materials become relevant written or oral comments is cannot read your comment due to available. You may obtain electronic provided in Unit I.D. of this notice. technical difficulties and cannot contact copies of these documents, and certain FOR FURTHER INFORMATION CONTACT: Any you for clarification, EPA may not be other related documents that might be member of the public who wishes able to consider your comment. available electronically, from the further information should contact Paul Electronic files should avoid the use of regulations.gov website and the HSRB I. Lewis, Designated Federal Officer special characters, any form of Internet Home Page at http:// (DFO), EPA, Office of the Science encryption, and be free of any defects or www.epa.gov/osa/hsrb/. For questions Advisor, (8105R), Environmental viruses. on document availability or if you do Protection Agency, 1200 Pennsylvania SUPPLEMENTARY INFORMATION: not have access to the Internet, consult Ave., NW., Washington, DC 20460; the person listed under FOR FURTHER I. Public Meeting telephone number: (202) 564–8381; fax: INFORMATION. (202) 564–2070; e-mail addresses: A. Does This Action Apply to Me? C. What Should I Consider as I Prepare [email protected]. This action is directed to the public My Comments for EPA? ADDRESSES: Submit your written in general. This action may, however, be You may find the following comments, identified by Docket ID No. of interest to persons who conduct or suggestions helpful for preparing your EPA–HQ–ORD–2006–0384, by one of assess human studies on substances comments: the following methods: regulated by EPA or to persons who are a. Explain your views as clearly as http://www.regulations.gov: Follow or may be required to conduct testing of possible. the on-line instructions for submitting chemical substances under the Federal b. Describe any assumptions that you comments. Food, Drug, and Cosmetic Act (FFDCA) used. E-mail: [email protected]. or the Federal Insecticide, Fungicide, c. Provide copies of any technical Mail: ORD Docket, Environmental and Rodenticide Act (FIFRA). Since information and/or data you used that Protection Agency, Mailcode: 28221T, other entities may also be interested, the support your views. 1200 Pennsylvania Ave., NW., Agency has not attempted to describe all d. Provide specific examples to Washington, DC 20460. the specific entities that may be affected illustrate your concerns. Hand Delivery: EPA Docket Center by this action. If you have any questions e. To ensure proper receipt by EPA, be (EPA/DC), Room B102, EPA West regarding the applicability of this action sure to identify the docket ID number Building, 1301 Constitution Avenue, to a particular entity, consult the person assigned to this action in the subject NW., Washington, DC 20460, Attention listed under FOR FURTHER INFORMATION line on the first page of your response. Docket ID No. EPA–HQ–ORD–2006– CONTACT. You may also provide the name, date, 0384. Deliveries are only accepted from and Federal Register citation. 8:30 a.m. to 4:30 p.m., Monday through B. How Can I Access Electronic Copies Friday, excluding legal holidays. of This Document and Other Related D. How May I Participate in This Special arrangements should be made Information? Meeting? for deliveries of boxed information. In addition to using regulations.gov, You may participate in this meeting Instructions: Direct your comments to you may access this Federal Register by following the instructions in this Docket ID No. EPA–HQ–ORD–2006– document electronically through the section. To ensure proper receipt by 0384. EPA’s policy is that all comments EPA Internet under the Federal Register EPA, it is imperative that you identify received will be included in the public listings at http://www.epa.gov/fedrgstr/. docket ID number EPA–HQ–ORD–2006– docket without change and may be Docket: All documents in the docket 0384 in the subject line on the first page made available online at http:// are listed in the http:// of your request. www.regulations.gov, including any www.regulations.gov index. Although a. Oral comments. Requests to present personal information provided, unless listed in the index, some information is oral comments will be accepted up to the comment includes information not publicly available, e.g., CBI or other June 21, 2006. To the extent that time claimed to be Confidential Business information whose disclosure is permits, interested persons who have Information (CBI) or other information restricted by statute. Certain other not pre-registered may be permitted by whose disclosure is restricted by statute. material, such as copyrighted material, the Chair of the HSRB to present oral Do not submit information that you will be publicly available only in hard comments at the meeting. Each consider to be CBI or otherwise copy. Publicly available docket individual or group wishing to make protected through http:// materials are available either brief oral comments to the HSRB is www.regulations.gov or e-mail. The electronically in http:// strongly advised to submit their request http://www.regulations.gov Web site is www.regulations.gov or in hard copy at (preferably via email) to the DFO listed an ‘‘anonymous access’’ system, which the ORD Docket, EPA/DC, EPA West, under FOR FURTHER INFORMATION means EPA will not know your identity Room B102, 1301 Constitution Ave., CONTACT no later than noon, eastern or contact information unless you NW., Washington, DC. The Public time, June 21, 2006, in order to be provide it in the body of your comment. Reading Room is open from 8:30 a.m. to included on the meeting agenda and to If you send an e-mail comment directly 4:30 p.m., Monday through Friday, provide sufficient time for the HSRB to EPA, without going through http:// excluding legal holidays. The telephone Chair and HSRB DFO to review the www.regulations.gov, your e-mail number for the Public Reading Room is agenda to provide an appropriate public address will be automatically captured (202) 566–1744, and the telephone comment period. The request should and included as part of the comment number for the ORD Docket is (202) identify the name of the individual that is placed in the public docket and 566–1752. making the presentation, the

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organization (if any) the individual will Laboratory Observational Human Dated: June 1, 2006. represent, and any requirements for Exposure Measurement Studies. Finally, Roland E. Smith, audiovisual equipment (e.g., overhead the Board may be reviewing draft HSRB Secretary, Farm Credit Administration Board. projector, LCD projector, chalkboard). reports for subsequent Board approval. [FR Doc. 06–5161 Filed 6–2–06; 9:04 am] Oral comments before the HSRB are Dated: June 1, 2006. BILLING CODE 6705–01–P limited to 5 minutes per individual or George Gray, organization. Please note that this limit applies to the cumulative time used by Science Advisor. [FR Doc. E6–8725 Filed 6–5–06; 8:45 am] DEPARTMENT OF HEALTH AND all individuals appearing either as part HUMAN SERVICES of, or on behalf of an organization. BILLING CODE 6560–50–P While it is our intent to hear a full range Request for Applications for the of oral comments on the science and National Faith-Based and National ethics issues under discussion, it is not FARM CREDIT ADMINISTRATION Community Cardiovascular Disease our intent to permit organizations to Prevention Programs for High-Risk expand these time limitations by having Sunshine Act; Farm Credit Women numerous individuals sign up Administration Board; Regular Meeting separately to speak on their behalf. If AGENCY: Office on Women’s Health, additional time is available, there may Office of Public Health and Science, AGENCY: be flexibility in time for public Farm Credit Administration. Office of the Secretary, DHHS. comments. Each speaker should bring SUMMARY: Notice is hereby given, Announcement Type: Competitive 25 copies of his or her comments and pursuant to the Government in the Cooperative Agreement FY 2006 Initial presentation slides for distribution to Sunshine Act (5 U.S.C. 552b(e)(3)), of announcement. the HSRB at the meeting. the regular meeting of the Farm Credit Funding Opportunity Number: Not b. Written comments. Although you Administration Board (Board). applicable. may submit written comments at any DATE AND TIME: The regular meeting of OMB Catalog of Federal Domestic time, for the HSRB to have the best the Board will be held at the offices of Assistance: The OMB Catalog of Federal opportunity to review and consider your the Farm Credit Administration in Domestic Assistance number is pending. comments as it deliberates on its report, McLean, Virginia, on June 8, 2006, from DATES: Letter of Intent: June 21, 2006. you should submit your comments at 9 a.m. until such time as the Board Application Deadline: July 6, 2006. least 5 business days prior to the concludes its business. Anticipated Award Date: October 4, beginning of the meeting. If you submit 2006. comments after this date, those FOR FURTHER INFORMATION CONTACT: SUMMARY: comments will be provided to the Board Roland E. Smith, Secretary to the Farm The Office on Women’s members, but you should recognize that Credit Administration Board, (703) 883– Health (OWH) and the Office of the Board members may not have 4009, TTY (703) 883–4056. Minority Health (OMH) within the Office of Public Health and Science, and adequate time to consider those ADDRESSES: Farm Credit comments prior to making a decision. the Office of Research on Women’s Administration, 1501 Farm Credit Drive, Health (ORWH) within the National Thus, if you plan to submit written McLean, Virginia 22102–5090. comments, the Agency strongly Institutes of Health (NIH), Department encourages you to submit such SUPPLEMENTARY INFORMATION: Parts of of Health and Human Services (DHHS), comments no later than noon, Eastern this meeting of the Board will be open are interested in establishing national Time, June 21, 2006. You should submit to the public (limited space available), faith-based and/or national community your comments using the instructions in and parts will be closed to the public. cardiovascular disease (CVD) prevention Unit 1.C. of this notice. In addition, the In order to increase the accessibility to programs. Agency also requests that person(s) Board meetings, persons requiring The purpose of the programs is to submitting comments directly to the assistance should make arrangements in reduce CVD mortality and morbidity docket also provide a copy of their advance. The matters to be considered among high-risk women in the United comments to the DFO listed under FOR at the meeting are: States through medical screening and risk behavior modification. The CVD FURTHER INFORMATION CONTACT. There is Open Session no limit on the length of written prevention programs will be targeted comments for consideration by the A. Approval of Minutes towards high-risk racial and ethnic minority women, aged 40 years and HSRB. • May 11, 2006 (Open and Closed). older; however, all high-risk women E. Background B. New Business shall be eligible to participate in the EPA will be presenting for HSRB programs regardless of race, religion, or • review the results of a completed study Texas Land Bank, FLCA–ACA age. involving intentional exposure of Conversion. Each grantee shall implement one human subjects to the pesticide active C. Reports program in 10 faith-based or ingredient, chloropicrin. In addition, community-based sites across the EPA will be seeking the Board’s advice • Loan Syndications Status Report. United States, including urban and rural on: Draft guidelines for conducting • FCS Building Association Quarterly areas. The main goal will be for program research on the efficacy of insect Report. participants to increase their level of repellent products; insect repellent physical activity and establish or Closed Session* human studies protocols and pesticide maintain a healthy weight over the agricultural handler human studies • Office of Secondary Market course of the program. The educational protocols. EPA will also be providing an Oversight. phase of the program shall consist of informational presentation of its eight bi-weekly sessions that shall proposed workshop on Best Practices * Session Closed—Exempt pursuant to 5 U.S.C. counsel women on all of the major risk for EPA, National Exposure Research 552b(c)(8) and (9). factors for CVD—smoking, Type 2

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diabetes, hypertension, cholesterol, physical activity and establish or tasks and requirements and answer any obesity, and physical inactivity—while maintain a healthy weight over the questions that grantees may have. primarily focusing on controlling weight course of the program. Grantees shall also share their program and increasing physical activity. The plans, approaches, and best practices 3. Requirements maintenance phase of the project shall with each other through presentations consist of regularly scheduled, A. Sites and Populations and round table discussions. interactive maintenance sessions that This cooperative agreement grant ii. Curriculum Development shall be designed by program announcement focuses on President A multi-disciplinary planning participants. During both phases, Bush’s agenda to broaden Federal efforts committee shall be formed consisting of participants will be screened for all six to work with faith-based and representatives from the national faith- major CVD risk factors. All counseling community organizations. For more and maintenance sessions shall include based or national community information on the Administration’s organization, health care professionals small group discussions and a physical Faith-Based Initiative, please see the activity component focused on reducing and counselors, and high-risk women in following Web site: http:// the community. The grantee will risk. www.whitehouse.gov/government/fbci/ These awards focus on President consult with the planning committee to index.html. design eight educational sessions that Bush’s agenda to broaden Federal efforts The grantee shall select 10 faith-based shall counsel women on all of the major to work with faith-based and or community-based sites with large risk factors for CVD (smoking, Type 2 community organizations. As such, each populations of high-risk racial and diabetes, hypertension, cholesterol, applicant must either: (1) Be a national ethnic minority women where the faith-based or national community obesity, and physical inactivity), ways program shall be implemented. The to modify risk, and the benefits organization that has a network of at grantees’ access to these population(s) least 10 sites across the United States associated with risk modification. The through the faith-based or community- prevention of stress and the signs/ with large populations of high-risk based sites should be demonstrated by racial and ethnic minority women, aged symptoms of heart attack and stroke in a history of collaboration or direct women shall also be addressed. The 40 years and older, or (2) partner with programmatic delivery. All sites should a national faith-based or national format of the health sessions will be be chosen from within the network of specified in subsequent sections of this community organization that has a the National faith-based or National network of at least 10 sites across the funding opportunity description. community organization. Examples of Existing curriculum from successfully United States with large populations of sites include community health centers, tested and evaluated CVD clinical high-risk racial and ethnic minority retirement centers, group counseling prevention intervention programs women, aged 40 years and older. Non- session centers, child care centers, should be obtained and adapted for this profit and for profit organizations that fitness and/or recreation centers, program. The OWH and ORWH/NIH meet the above criteria are eligible to community clinics, and places of will not provide the grantee with apply. Faith-based organizations, worship. The 10 sites must not be curriculum. The curriculum and group community-based organizations, tribal located in only one section of the counseling session materials must be entities, educational institutions, country; they must be geographically both culturally competent and women- community health centers, and dispersed throughout the United States, centered (see section VIII.2 for government entities that meet the above including urban and rural areas. The definitions). criteria are also eligible and encouraged grantee shall sign an MOU with each to apply. site that describes the expectations and iii. Site Leaders and Site Leader Training I. Funding Opportunity Description duties of each party. The grantee shall target high-risk One site leader from each of the 10 1. Authority women aged 40 years and older who are sites will be designated to promote, This program is authorized by 42 members of at least one racial and coordinate, and facilitate the clinical U.S.C. 300u–2(a) and 42 U.S.C. 287d. ethnic minority population; however, prevention program at his/her particular all high-risk women shall be eligible to site. This person will be a faith-based or 2. Purpose participate in the program, regardless of community leader or a health This cooperative agreement shall fund race, religion, or age. professional affiliated with the site. national faith-based and/or national B. Phase I: Program Planning, Each site shall be given a stipend for community cardiovascular disease Development, and Recruitment their involvement; this stipend shall (CVD) clinical prevention programs to include compensation for the site reduce cardiovascular disease mortality i. Post-Award Orientation leader. The stipend will not exceed and morbidity among high-risk women The grantee shall send two or three $5,000 per site. in the United States through counseling representatives to a two-day post-award All site leaders shall be required to and risk behavior modification. The orientation meeting in Washington, DC. attend a one-day training course, CVD prevention programs will be This meeting shall occur within 2 developed and administered by the targeted towards high-risk racial and months of grant award. The project grantee. This course must take place in ethnic minority women, aged 40 years manager of the program and a one location and site leaders must and older, however, all high-risk women representative who holds a leadership attend in person. The training course shall be eligible to participate in the position in the national faith-based or will introduce site leaders to the goals, programs regardless of race, religion, or national community organization must structure, and subject matter of the age. Each grantee shall implement one attend the meeting. Travel funds for this program. The training session will also program in 10 faith-based or meeting must come out of the total equip site leaders with the materials, community-based sites across the award funding and should be included strategies, and resources necessary to United States, including urban and rural in the applicant’s cost proposal. implement the program at their sites. areas. The main goal will be for program The purpose of the post-award Upon completion of training, each site participants to increase their level of orientation meeting will be to clarify leader will receive a training certificate.

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After receiving training, site leaders will Heart Web site at http:// ii. Group Counseling Sessions—Session coordinate and host all group www.4women.gov/hhs and the National #1: Screening and Program Introduction counseling sessions and maintenance Heart, Lung and Blood Institute’s Heart During the first group counseling sessions at their specific sites. Truth Campaign Web site http:// session, screening for all six major CVD www.nhlbi.nih.gov/health/hearttruth/. iv. Recruitment and Retention risk factors shall be conducted for each The grantee shall publish a print and/ Each site leader will be responsible participant (weight measurements or Web-based newsletter to promote the for promoting the prevention program should be kept confidential) to establish program, provide additional and clinical speakers and participants at baseline measurements. (Note: Fasting her site. Each site shall aim to recruit an cardiovascular disease information, and blood tests must be used to screen for average of 20 to 50 participants. High- highlight progress made by individual cholesterol and Type 2 diabetes.) The risk racial and ethnic minority women sites and participants. The newsletter grantee may solicit local health care aged 40 years and older shall be will be distributed to all 10 sites on a organizations, drug stores, and/or other targeted; however, all high-risk women monthly basis. private sources to donate or loan shall be eligible to participate in the C. Phase II: Group Counseling Sessions screening equipment, giving proper program, regardless of race, religion, or acknowledgment for their assistance. i. Overview age. All participants must read and sign Additionally, health professionals who volunteer to present at counseling a written consent form before starting Each faith-based or community-based sessions can be asked to bring the program. The grantee shall prepare site will host eight bi-weekly group equipment with them and help conduct the draft consent form in lay-language counseling sessions over a period of the screenings. Alternatively, grantees and the multi-disciplinary planning four months. The sessions can be may use grant funds to purchase committee must review and approve physically located at the faith-based or screening equipment and supplies. this form. The grantee shall also obtain community-based site or at any other appropriate institutional IRB approval, The importance of weight control and appropriate clinical facility in the physical activity will be introduced and if applicable. The grantee will also community. These sessions shall create postcard reminders (or e-mail emphasized as the primary goal of the address the six major risk factors for program. Daily weight and physical reminders if participants have easy CVD (smoking, Type 2 diabetes, access to the Internet) for each group activity self-monitoring materials hypertension, cholesterol, obesity, and (diaries, logs, etc.) will be distributed counseling session and maintenance physical inactivity), ways to modify session. Each site leader will mail or e- and explained. The site leader should risk, and the benefits associated with also discuss the reward system for mail the reminders to each participant. risk modification. The prevention of The site leader will also make reminder reaching risk modification goals. stress and the signs/symptoms of heart Moreover, the first session should phone calls as necessary. attack and stroke in women shall also be All counseling sessions and include a basic orientation on how to addressed during at least one of the maintenance sessions shall be focused use the Internet. The orientation shall eight group counseling sessions. on mutual support for participants in include instruction on how participants Sessions may include medical their efforts to reduce the risk associated who do not own computers can access screening, clinical lectures, health with increased weight and physical computers that are available for public demonstrations, video presentations, inactivity. Site leaders will obtain and use. The format of the orientation may activities, etc. Each session must also distribute incentives for attendance include a hands-on demonstration, incorporate some form of low to (e.g., door prizes) and incentives to pictorial diagrams, and/or written moderate physical activity (such as motivate participants to modify risk instruction. This award shall not pay for walking, yoga, or aerobics). Participants factors during the course of the program. computers. shall be encouraged and organized to Prizes will be offered to the participants During the first counseling session, meet in groups at least once a week to who achieve their individualized risk each participant shall also be engage in some form of physical modification goals for each session. administered a test to determine activity. Positive reinforcement and open baseline knowledge of CVD and its risk communication as well as a healthy Additionally, each session shall factors. Additionally, each participant sense of competition must be include a small group counseling shall assess her own personal CVD risk encouraged. Incentives and prizes may discussion component that will focus on profile and Stage of Change (1) for the be solicited as donations from private encouraging participants to incorporate six major CVD risk factors. One tool that sources. weight control strategies and physical can be used to assess a woman’s Stage activity into their daily lives. of Change for each major CVD risk factor v. Resource Establishment Participants shall be divided into small can be found on the DHHS/OWH’s For The grantee must assist site leaders in counseling groups according to criteria Your Heart Web site at http:// compiling a local directory of chosen by the grantee. These criteria www.4women.gov/hhs. Information cardiovascular resources (cardiologists, may be based on Prochaska’s Stages of from this Web site can also be dieticians, Type 2 diabetes experts, Change model (1), demographics, risk incorporated into the curriculum for weight loss and exercise programs, factor profiles, etc. During the group subsequent sessions. public health screening and diagnosis discussion component, participants information) available in the community should discuss self-monitoring efforts iii. Group Counseling Sessions #2–7: of each site, including health care and establish risk modification goals. Risk Factors alternatives for the uninsured and under The grantee will consult and utilize After the first introductory group insured women. The grantee shall qualified cardiologists, endocrinologists, counseling session, the following six establish a national Web site or enhance nurses, dieticians, physical exercise and group counseling sessions will be an existing organization’s Web site to other health professionals in the devoted to counseling participants provide cardiovascular support and development and implementation of the about one CVD risk factor, so that all six information online. These Web sites curriculum and small group of the major risk factors’ smoking, Type shall be linked to the OWH’s For Your discussions. 2 diabetes, hypertension, cholesterol,

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obesity, and physical inactivity are participant shall assess her own warning symptoms and signs of a heart covered. In addition, key lessons personal CVD risk profile and Stage of attack and the importance of accessing learned at previous sessions will be Change. Each participant shall also be rapid emergency care by calling 911. reviewed at each of the following administered a test to determine 3. Increase the proportion of sessions to reinforce risk factor knowledge of CVD and its risk factors. participants who know the major risk knowledge. Additionally, participants shall be asked factors for CVD and how to modify to give feedback and evaluate the those risk factors. iv. Group Counseling Session #8: program. Screening and Wrap-up 4. Increase the participant’s E. Phase IV—Program Evaluation/Write- knowledge of CVD resources in the During the eighth and final group up community. counseling session, participants shall be Screening, knowledge, Stage of 5. Decrease the proportion of screened again for all six major CVD risk participants who are obese. factors and each participant shall assess Change (1), and personal health risk 6. Decrease the proportion of her own personal CVD risk profile and profile data shall be obtained from three participants who are overweight. Stage of Change. Each participant shall assessment points the first (baseline) also be administered an intake form to and last group counseling session and 7. Increase the proportion of determine knowledge of CVD and its the last maintenance session. (Note: participants who engage regularly in risk factors. Additionally, participants Fasting blood tests must be used to moderate physical activity (outside of shall be asked to provide feedback screen for cholesterol and Type 2 program sessions). regarding their experience in the diabetes during these three assessment 8. For each CVD clinical risk factor, program and evaluate the program. points.) Data shall also be obtained from move 50% of participants up at least Responses will be used to aid self-monitoring materials and from one Stage of Change (1). participants in designing the feedback and evaluation forms. Grantees Secondary Outcome Measures: maintenance phase of the program. may choose to use any appropriate 1. Decrease the proportion of Participants will also decide on a plan assessment tools, survey instruments, participants who smoke. self-monitoring and evaluation materials of action for follow-up maintenance 2. Increase the proportion of to collect data. All data collection sessions. participants with Type 2 diabetes at materials must be reviewed and baseline whose Type 2 diabetes is under D. Phase III—Maintenance Sessions approved by the multi-disciplinary control. The maintenance sessions will take planning committee. In addition, grantees shall be required to include a 3. Increase the proportion of place over a period of three months participants with high blood pressure at directly following the group counseling core set of screening and evaluation items that will be prescribed by the baseline whose blood pressure is under sessions (Phase II). With the aid of the control. site leader, participants shall decide on OWH. These items will be determined during and after the post-award 4. Decrease the proportion of the number, frequency, and format of orientation meeting and will most likely participants with high total blood the maintenance sessions. These consist of items developed by one or cholesterol. sessions may include any or all of the more of the grantees. The evaluation should also address following: Additional group counseling The grantee shall design one the following questions: seminars, screenings, testimonials, centralized database, collect all 1. Did participants evaluate the personal counseling, field trips (e.g., participant data from the site leaders, trips to fitness centers or trips to grocery program favorably? and enter data into the database. This 2. Did the program meet the needs stores and restaurants to practice data shall be kept confidential through selecting healthy foods), etc. However, and expectations of the participants? use of unique identifying numbers. 3. What changes do the participants each session must include a physical Baseline and follow-up data must be suggest? activity and a small group discussion analyzed to quantitatively evaluate the component. In addition, participants program’s effectiveness at two different Emphasis should be placed on shall be encouraged and organized to intervals—after the end of the group aligning program outcomes and targets meet in smaller groups at least once a counseling sessions and after the end of with the objectives and targets of week to engage in some form of physical the maintenance sessions. The program Healthy People 2010. More information activity. evaluation must be able to demonstrate, on the Healthy People 2010 objectives At each site, the format of each at minimum, the following desired may be found at http://www.health.gov/ maintenance session should be clearly program outcomes: healthypeople. Each grantee should also outlined and documented by the site Primary Outcome Measures: take into account the baseline leader (what type of activity, duration of 1. Increase the proportion of characteristics of the potential program activity, material covered, location etc.). participants who are aware that heart participants when setting outcome During the last maintenance session, disease is the #1 killer of women. targets. participants will be screened again for 2. Increase the proportion of The Time Chart below summaries all six major CVD risk factors and each participants who are aware of the early each phase of the CVD program.

Duration Phases Activity Description (months)

CVD Program ...... National Faith-Based and National-Community Cardiovascular Disease Prevention 18 Programs for High-Risk Women (CVD).

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Duration Phases Activity Description (months)

Phase I ...... Program Planning & Orientation Session, Program Development, Formation of a Multi-disciplinary Plan- 1–8 Recruitment. ning Committee. Selection of Site Leaders, Site Leader Training, Recruitment and Retention. Resource Establishment, Develop DataBase.

Phase II ...... Group Counseling Host eight group counseling sessions: Sessions. Group Counseling Session No. 1—Screening and Program Introduction. CVD Pre- 9–12 knowledge test administered to all program participants. Group Counseling Ses- sion Nos. 2–7—CVD Risk Factors discussion. Group Counseling Session No. 8—Participants screened again for all six CVD risk factors. Participants will as- sess their own personal CVD risk profile and Stage of Change, Post CVD knowl- edge test administered to all participants. Participants prepare an evaluation of the program.

Phase III ...... Maintenance Ses- Site leaders will assist participants to design a format for maintenance sessions ..... 13–15 sions. Screening of all participants for all six CVD risk factors ...... (six Assessment of risk profile and Stage of Change. sessions.) CVD post knowledge test administered. Program Evaluation completed.

Phase IV ...... Program Evaluation Data entered into centralized database...... 16–18 and Write-Up. Data analyzed to evaluate the program’s effectiveness. Incorporate mutually agreed upon edits from the DHHS/OWH into final copy. Sub- mit second financial status report as an appendix to the final report Participate in a committee with other grantees and DHHS/OWH staff to prepare a joint manuscript. Prepare a draft of the final report.

OWH shall site visit at least 4 sites per II. Award Information award and expand it to other sites grantee during Phases II and/or Phase Under this announcement, OWH and within its network. III. The grantee shall participate in ORWH/NIH anticipate making, through The grantee shall complete the monthly conference calls with the OWH the cooperative agreement grant requirements described in the Funding and other grantees. The grantee shall mechanism, one or two new 18-month Opportunity Description. Specifically, also host a separate monthly conference awards by October 4, 2006. the grantee will: • Submit a work plan, task outline, call with all site leaders and make Approximately $500,000 in FY 2006 and schedule of activities within one additional contact with individual sites funds is available to make awards up to as necessary via e-mail and phone calls. month of award. $100,000 total cost (direct and indirect) • Attend a two-day post-award The grantee shall prepare a progress for an 18-month period. The actual orientation meeting in Washington, DC report that outlines the status and number of awards made will depend within two months of grant award. progression of the project every 3 upon the quality of the applications (Travel funds for this meeting must months (there will be a total of 5 received and amount of funds available come out of the total award funding and progress reports). The grantee shall for the program. The government is not should be included in the applicant’s prepare a final report that describes the obligated to make any awards as a result budget justification.) results from the program evaluation and of this announcement. • Participate in monthly conference all project activities for the entire 18- Under this cooperative agreement, the calls with the OWH and other grantees. month period of the program. OWH duties of the grantee and the Federal • Host a monthly conference call with shall provide an outline of the final Government are described below. The all site leaders and make additional report format and templates for required OWH will provide the technical contact with individual sites as tables. A draft of the final report must assistance and oversight necessary for necessary via e-mail and phone calls. be submitted electronically and in hard the implementation, conduct, and • Prepare and submit progress reports copy format six weeks prior to the end assessment of program activities. This that outline the status and progression date of the award. OWH will review the program will be a model; as such, the of the program every 3 months. Federal Government may replicate the draft. Suggested revisions will be • Form a multi-disciplinary planning clinical prevention program and/or use discussed individually during a committee consisting of representatives the intervention materials both during conference call with each grantee. The from the national faith-based and/or and after the period of performance. The mutually agreed upon revisions must be national community organization, grantee may copyright any work that is health care professionals and incorporated into the final report by the developed, or for which ownership was end date of the award. counselors, and high-risk women in the purchased, under the award, but DHHS community. Finally, the grantee shall assign one reserves a royalty-free, nonexclusive • Select 10 faith-based or community- authorized staff member to participate and irrevocable right to reproduce, based sites in both urban and rural areas in a committee with other grantees and publish, or otherwise use the work for throughout the United States that are OWH to prepare a joint manuscript Federal purposes, and to authorize willing to participate in the program, suitable for publication in a peer- others to do so. In addition, the grantee and sign an MOU with each site. reviewed journal. This manuscript shall and the national faith-based or • Select site leaders at each site. combine and summarize data from all community partner are encouraged to • Establish and promote a national programs into one final evaluation. sustain the program after the end of Web site or enhance an existing

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organization’s Web site to provide resources available in the community • Review and approve all group cardiovascular support and information for each site. counseling sessions and instructional online. • Assist site leaders in scheduling materials for the eight group counseling • Consult with the planning counseling sessions at each site. sessions. committee to develop eight group • Assist site leaders in obtaining • Provide the grantee with counseling sessions that address all of medical screening equipment, obtain government group counseling sessions’ the major risk factors for coronary heart clinical personnel, and participation materials on CVD, such as The Heart disease and stroke. Curriculum should incentives. Truth for Women: A Speaker’s Kit, The • be adapted from existing models of CVD Assist site leaders in coordinating Healthy Heart Handbook for Women prevention intervention curriculum that medical screenings and administering (22), etc. evaluation materials. • have been successfully tested and • Provide all site leaders with evaluated. Assist site leaders in obtaining guidelines for the Americans with • Prepare or obtain group counseling clinical speakers for the sessions (e.g., Disabilities Act and ensure that those session materials for the eight group nurses, physicians and other health care guidelines are followed during the counseling sessions (e.g., instructional professionals) and conducting Web site planning and implementation of the training. manual, educational sessions and/or • CVD program. exercise videos, booklets, etc.). Assist site leaders with resources • Review and approve materials for necessary to support the format of the • Develop small group discussion the one-day leader training course; and, format for each session focusing on maintenance sessions chosen by the • Review self-monitoring materials, encouraging participants to incorporate participants. evaluation materials and survey • Collect all participant data using weight control strategies and physical instruments that must be used by each activity into their daily lives. standard data collection forms. • Enter all data obtained from each grantee (core set of screening and • Develop instructional manual for site into centralized database using evaluation items). the physical activity component of each • unique identifiers for each participant. Review and approve informed educational session and maintenance • Analyze data using appropriate consent document and program session. statistical software and submit a draft of promotional materials to ensure • Develop self-monitoring risk the FINAL REPORT six weeks prior to adherence to DHHS policies. modification materials (logs, diaries, • the end date of the grant award. Review the design and content of etc.) that are user-friendly and allow • Incorporate mutually agreed upon program Web site(s). • participants to track regular physical edits from the OWH into FINAL Review and provide information for activity and weight control behaviors. REPORT by the end date of the award. newsletters. • • Develop pre- and post-evaluation • Assign one staff member to Provide an outline of the final materials and survey instruments (e.g., participate in a committee with other report format and templates for required knowledge tests, screening data grantees and OWH and prepare a joint tables. • collection forms, risk factor profile manuscript suitable for publication in a Review draft of the final report and assessment tools, and qualitative peer-reviewed journal. provide comments and edits to be feedback forms). • incorporated into the final document. • Adhere to all program requirements Prepare a draft consent form in lay- specified in this announcement and the • Participate in a committee with language, obtain appropriate Notice of Grant Award. grantees to prepare a joint manuscript institutional IRB approval, if applicable, • Submit two Financial Status suitable for a peer-reviewed journal and and obtain consent from all program Reports. Financial Status Report number secure appropriate government participants. one is to be submitted to the Project publication clearance. • Develop program promotional Officer on the first anniversary date of materials (e.g., flyers, pamphlets, etc.). III. Eligibility Information • the grant award. Financial Status Report Develop postcard or e-mail number two is to be submitted to the 1. Eligible Applicants reminders for each counseling session Project Officer as an appendix to the and maintenance session. These awards focus on President • final grant report. Bush’s agenda to broaden Federal efforts Design one-day site leader training • Adhere to the guidelines under the course. to work with faith-based and • American with Disabilities Act when community organizations. As such, each Develop materials for one-day site planning and implementing seminars. leader training course (training manual, applicant must either: (1) Be a national Specifics will be discussed during the faith-based or national community certificates, etc.). one-day course. • Transport site leaders to the organization that has a network of at The Federal Government will: least 10 sites across the Continental training session and execute training • Review and approve work plan, United States and its territories with session. task outline, and schedule of activities. • Reproduce all group counseling • Review quarterly progress reports. large populations of high-risk racial and sessions, self-monitoring, and • Conduct the monthly conference ethnic minority women, aged 40 years evaluation materials and deliver copies calls with grantees. and older, or (2) partner with a national to each site leader. • Conduct the two-day post-award faith-based or national community • Reproduce reminder postcards/e- orientation meeting in Washington, DC organization that has a network of at mails, consent document and within two months of award. least 10 sites across the United States promotional materials and deliver to • Review and approve list of 10 faith- with large populations of high-risk each site leader. based and/or community sites and the racial and ethnic minority women, aged • Design a print and/or web-based MOUs with each site. 40 years and older. If a partnership is newsletter. • Site visit at least 4 sites per program established, the applicant and the • Distribute newsletter to each site on during Phases II and/or Phase III. national faith-based or national a monthly basis. • Review, suggest names, and community organization must sign a • Assist site leaders in compiling a approve membership of the multi- Memorandum of Understanding (MOU) local directory of cardiovascular disciplinary planning committee. that describes the partnership, including

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the expectations and duties of each IV. Application and Submission of existing curriculum, samples of partner. This MOU must be included in Information survey instruments and data collection forms, and research results and the application. If the document is not 1. Address To Request Application provided, the application may not be Package references may be included as part of an considered. Please see section VIII.2 for appendix and will not count toward the a definition of partnership, national Application kits may be requested by 50 pages limit. The application must faith-based organization, and national calling (240) 453–8822 or writing to: also include a detailed budget community organization. For more OPHS Office of Grants Management, justification, including a narrative and information on the Administration s 1101 Wootton Parkway, Suite 550, computation of expenditures for one Rockville, MD 20852. Requests may also Faith-Based and Community Initiatives year. The budget justification does not be submitted by fax at (240) 453–8823. please see the following Web site: count toward the 50 pages limit. Application kits are also available http://www.whitehouse.gov/ online through the OPHS electronic An outline for the minimum government/fbci/index.html. grants management Web site at https:// information to be included in the Non-profit and for-profit egrants.osophs.dhhs.gov and Grants.gov ‘‘Project Narrative’’ section is presented organizations that meet the above at http://www.grants.gov. below. criteria are eligible to apply. Faith-based 2. Content and Form of Application i. Program Plan organizations, community-based Submission organizations, tribal entities, The applicant must describe, in educational institutions, community A. Letter of Intent detail, its approach for accomplishing health centers, and government entities A Letter of Intent (LOI) is encouraged each of the requirements identified in that meet the above criteria are also from all potential applicants for the the funding opportunity description. eligible and encouraged to apply. purpose of planning the competitive The program plan must reference each requirement, and the material should be Any organization currently receiving review process. The LOI should be no presented in the order in which it funding or support from the Centers for more than one page, double-spaced, appears in the funding opportunity Disease Control and Prevention’s (CDC) printed on one side, with one-inch description. The applicant should WISEWOMAN program is not eligible to margins, and 12-point font. LOIs should demonstrate a full understanding of the apply to this grant announcement. include the following information: (1) need for the program, anticipating, These organizations have been deemed Program announcement title and number; (2) name of the applicant prioritizing, and presenting likely ineligible to prevent the overlapping of components that will achieve overall the OWH and the CDC’s cardiovascular agency or organization, the official contact person and that person’s goals and desired outcomes. The disease prevention programs and the telephone number, fax number, and applicant should also identify potential possible contamination of current mailing and e-mail addresses (3) name problems and intended solutions. The WISEWOMAN program results. and address of the partnering national applicant is free to recommend and If funding is requested in an amount faith-based or national community describe other procedures that it greater than the ceiling of the award organization if the applicant is not a believes will more effectively achieve range ($100,000 total cost for an 18- national faith-based or national the stated objectives, but needs to month period), the application will be community organization. Do not include carefully relate alternatives and considered non-responsive and will not a description of your proposed project. rationales to the approach recommended in the funding be entered into the review process. The B. Application application will be returned with opportunity description. notification that it did not meet the Applications must be submitted using The proposal should include the Form OPHS–1 (Revised 8/04) and in submission requirements. Applications curriculum outlines and sample agendas the manner prescribed in the that are not complete or do not conform for one or more of the group counseling application kit. Applicants are required to or address the criteria of this sessions described in the funding to submit an original ink-signed and announcement will be considered non- opportunity description. The applicant dated application and 2 photocopies. responsive and will not be entered into must provide a detailed description of The application should be organized in the review process. The application will the existing curriculum that will be accordance with the format presented in be returned with notification that it did adapted and used for the group the Program Guidelines. The original counseling sessions. In addition, not meet the submission requirements. and each copy must be stapled and/or samples of the existing curriculum and An organization may submit no more otherwise securely bound. All pages results from any pilot or demonstration than one proposal for the program must be numbered clearly and announced in this notice of funding sequentially. The application must be projects that used the curriculum should be provided. These samples and availability. Organizations submitting typed on plain 81⁄2″ × 11″ white paper, more than one proposal will be deemed using a 12 point font, and contain 1″ results may be included as part of the ineligible. The proposal will be returned margins all around. The Project appendices. without comment. Narrative, excluding the appendices, is The proposal should describe the criteria for selecting sites and provide a 2. Cost Sharing or Matching Funds limited to a total of 50 pages, the fronts and backs of 10 pieces of paper. The potential list of sites or locations of Cost sharing and matching funds are first 50 pages of the proposal will be sites. The proposal should describe its not a requirement of this grant; however considered; any pages exceeding this plan for maintaining contact with each applicants may solicit private sources length will be removed from the site on a regular basis. The proposal for donations and/or loans of screening proposal and will not be evaluated. Staff should also include letters of support equipment, screening personnel, and resumes, letters of support, from each site selected, if possible. participation incentives. memorandums of understanding Letters of support may be included as (MOUs), budget justifications, samples part of the appendices.

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C. Experience and Commitment of Key modification programs, and previous or the Grants.gov Web site Portal is Personnel collaborations with a national faith- encouraged. Electronic grant application The applicant must identify key based or national community submissions must be submitted no later personnel involved in the project based organization. than 5 p.m. Eastern Time on the on the requirements described in F. Appendices deadline date specified in the DATES funding opportunity description and Include documentation and other section of the announcement using one other personnel adequate to support the supporting information in this section, of the electronic submission administrative, logistical, financial, and including staff resumes, letters of mechanisms specified below. All scientific coordination aspects of the support, memorandums of required hardcopy original signatures project within the time limits of the understanding (MOUs), samples of and mail-in items must be received by grant. The applicant must provide existing curriculum, samples of survey the OPHS Office of Grants Management information on which task(s) each of the instruments and data collection forms, no later than 5 p.m. Eastern Time on the key personnel will perform and the and research results and references. If next business day after the deadline rationale for that assignment. Resumes the applicant is not a national faith- date specified in the DATES section of for all proposed personnel must be based or national community the announcement. submitted with the application in the organization, an MOU between the Applications will not be considered appendices. applicant and a national faith-based or valid until all electronic application D. Management Plan national community organization components, hard copy original confirming that a partnership has been signatures, and mail-in items are The applicant should develop and established must be included in the received by the OPHS Office of Grants propose a Management Plan. This plan appendices. The applicant should also Management according to the deadlines includes a program schedule that lays include an MOU between the applicant specified above. Application out tasks and a time-line and identifies and any other organization or entity submissions that do not adhere to the significant milestones for the with which it intends to collaborate/ due date requirements will be accomplishment of the project. Specific partner. considered late and will be deemed staff responsibilities must be detailed in ineligible. this schedule along with the number of 3. Submission Dates and Times Applicants are encouraged to initiate hours that each person will devote to The LOI must be received by the electronic applications early in the each task. The plan must provide, at a OPHS Office of Grants Management by application development process, and to minimum, details pertaining to the four 5 p.m. Eastern Time on the deadline submit early on the due date or before. program phases (Phase I: Program date specified in the DATES section of This will aid in addressing any Planning, Development, and the announcement. If an applicant does problems with submissions prior to the Recruitment; Phase II: Group not submit an LOI by the established application deadline. Counseling Sessions; Phase III: due date and time, the application will Maintenance Sessions; Phase IV: not be eligible for the review process. Electronic Submissions via the Program Evaluation/Write-Up) as they Submit the LOI to: OPHS Office of Grants.gov Web Site Portal are outlined in the funding opportunity Grants Management, 1101 Wootton The Grants.gov Web site Portal description. Parkway, Suite 550, Rockville, MD provides organizations with the ability E. Past Performance 20852. to submit applications for OPHS grant opportunities. Organizations must Each applicant should describe its Submission Mechanisms successfully complete the necessary organization’s relevant experience and The OPHS provides multiple registration processes in order to submit success in managing this type of project. mechanisms for the submission of an application. Information about this The applicant should also include a applications, as described in the system is available on the Grants.gov description of itself, the experience of following sections. Applicants will Web site, http://www.grants.gov. its support personnel, and information receive notification via mail from the In addition to electronically about grantees, partners, and quality of OPHS Office of Grants Management submitted materials, applicants may be cooperation between organization, staff, confirming the receipt of applications required to submit hard copy signatures key personnel, and clients. Specific submitted using any of these for certain program related forms, or descriptions of relevant previous mechanisms. Applications submitted to original materials as required by the experience that the organization has the OPHS Office of Grants Management announcement. It is imperative that the performed within the past five years after the deadlines described below will applicant review both the grant must be included. Include period of not be accepted for review. Applications announcement, as well as the performance, dollar amount, name of which do not conform to the application guidance provided within program sponsor, and a letter of support requirements of the grant announcement the Grants.gov application package, to from at least three different program will not be accepted for review and will determine such requirements. Any sponsors. Letters of support may be be returned to the applicant. required hard copy materials, or included as part of the appendices. Applications may only be submitted documents that require a signature, Relevant previous experience may electronically via the electronic must be submitted separately via mail to include, but is not limited to, the submission mechanisms specified the OPHS Office of Grants Management, development of: Comprehensive below. Any applications submitted via and, if required, must contain the interventions or group counseling any other means of electronic original signature of an individual sessions programs aimed at improving communication, including facsimile or authorized to act for the applicant the health of women and/or men, health electronic mail, will not be accepted for agency and the obligations imposed by behavior modification programs, review. While applications are accepted the terms and conditions of the grant programs delivered in faith-based or in hard copy, the use of the electronic award. community settings, cardiovascular application submission capabilities Electronic applications submitted via disease prevention and risk provided by the OPHS eGrants system the Grants.gov Web site Portal must

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contain all completed online forms egrants.osophs.dhhs.gov, or may be must be signed by an individual required by the application kit, the requested from the OPHS Office of authorized to act for the applicant Program Narrative, Budget Narrative Grants Management at (240) 453–8822. agency or organization and to assume and any appendices or exhibits. All When submitting applications via the for the organization the obligations required mail-in items must received by OPHS eGrants system, applicants are imposed by the terms and conditions of the due date requirements specified required to submit a hard copy of the the grant award. above. Mail-In items may only include application face page (Standard Form Mailed or hand-delivered applications publications, resumes, or organizational 424) with the original signature of an will be considered as meeting the documentation. individual authorized to act for the deadline if they are received by the Upon completion of a successful applicant agency and assume the OPHS Office of Grant Management on or electronic application submission via obligations imposed by the terms and before 5 p.m. Eastern Time on the the Grants.gov Web site Portal, the conditions of the grant award. If deadline date specified in the DATES applicant will be provided with a required, applicants will also need to section of the announcement. The confirmation page from Grants.gov submit a hard copy of the Standard application deadline date requirement indicating the date and time (Eastern Form LLL and/or certain Program specified in this announcement Time) of the electronic application related forms (e.g., Program supersedes the instructions in the submission, as well as the Grants.gov Certifications) with the original OPHS–1. Applications that do not meet Receipt Number. It is critical that the signature of an individual authorized to the deadline will be returned to the applicant print and retain this act for the applicant agency. applicant unread. confirmation for their records, as well as Electronic applications submitted via 4. Intergovernmental Review a copy of the entire application package. the OPHS eGrants system must contain All applications submitted via the all completed online forms required by This program is subject to the Public Grants.gov Web site Portal will be the application kit, the Program Health Systems Reporting validated by Grants.gov. Any Narrative, Budget Narrative and any Requirements. Under these applications deemed ‘‘Invalid’’ by the appendices or exhibits. The applicant requirements, community-based and Grants.gov Web site Portal will not be may identify specific mail-in items to be faith-based, non-governmental transferred to the OPHS eGrants system, sent to the Office of Grants Management applicants must prepare and submit a and OPHS has no responsibility for any separate from the electronic submission; Public Health System Impact Statement application that is not validated and however these mail-in items must be (PHSIS). Applicants shall submit a copy transferred to OPHS from the Grants.gov entered on the eGrants Application of the application face page (SF–424) Web site Portal. Grants.gov will notify Checklist at the time of electronic and a one-page summary of the project, the applicant regarding the application submission, and must be received by the called the Public Health System Impact validation status. Once the application due date requirements specified above. Statement. The PHSIS is intended to is successfully validated by the Mail-In items may only include provide information to State and local Grants.gov Web site Portal, applicants publications, resumes, or organizational health officials to keep them apprised of should immediately mail all required documentation. proposed health services grant hard copy materials to the OPHS Office Upon completion of a successful applications submitted by community- of Grants Management to be received by electronic application submission, the based or faith-based, non-governmental the deadlines specified above. It is OPHS eGrants system will provide the organizations within their jurisdictions. critical that the applicant clearly applicant with a confirmation page Community-based and faith-based, identify the organization name and indicating the date and time (Eastern non-governmental applicants are Grants.gov Application Receipt Number Time) of the electronic application required to submit, no later than the on all hard copy materials. submission. This confirmation page will Federal due date for receipt of the Once the application is validated by also provide a listing of all items that application, the following information Grants.gov, it will be electronically constitute the final application to the head of the appropriate state and transferred to the OPHS eGrants system submission including all electronic local health agencies in the area(s) to be for processing. Upon receipt of both the application components, required impacted: (a) A copy of the face page of electronic application from the hardcopy original signatures, and mail- the application (SF 424), (b) a summary Grants.gov Web site Portal, and the in items, as well as the mailing address of the project (PHSIS), not to exceed one required hardcopy mail-in items, of the OPHS Office of Grants page, which provides: (1) A description applicants will receive notification via Management where all required hard of the population to be served, (2) a mail from the OPHS Office of Grants copy materials must be submitted. summary of the services to be provided, Management confirming the receipt of As items are received by the OPHS and (3) a description of the coordination the application submitted using the Office of Grants Management, the planned with the appropriate state or Grants.gov Web site Portal. electronic application status will be local health agencies. Copies of the Applicants should contact Grants.gov updated to reflect the receipt of mail-in letters forwarding the PHSIS to these regarding any questions or concerns items. It is recommended that the authorities must be contained in the regarding the electronic application applicant monitor the status of their application materials submitted to the process conducted through the application in the OPHS eGrants system OWH. Grants.gov Web site Portal. to ensure that all signatures and mail-in This program is also subject to the items are received. requirements of Executive Order 12372 Electronic Submissions via the OPHS that allows States the option of setting eGrants System Mailed or Hand-Delivered Hard Copy up a system for reviewing applications The OPHS electronic grants Applications from within their States for assistance management system, eGrants, provides Applicants who submit applications under certain Federal programs. The for applications to be submitted in hard copy (via mail or hand- application kit to be made available electronically. Information about this delivered) are required to submit an under this notice will contain a listing system is available on the OPHS original and two copies of the of States that have chosen to set up a eGrants Web site, https:// application. The original application review system and will include a State

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Single Point of Contact (SPOC) in the Human Services Division of Cost curriculum that will adapted for the State for review. Applicants (other than Allocation (DCA) Regional Office that is program and preliminary outlines and federally recognized Indian tribes) applicable to your State can provide sample agendas for one or more of the should contact their SPOCs as early as information on how to receive such a group counseling sessions described in possible to alert them to the prospective rate. A list of DCA Regional Offices is the funding opportunity description. applications and receive any necessary included in the application kit for this • Potential for the success of the instructions on the State process. For announcement. Guidance for proposed program plan to improve the proposed projects serving more than one completing the budget can be found in cardiovascular health status of the State, the applicant is advised to contact the Program Guidelines, which are targeted population. the SPOC in each affected State. A included with the complete application B. Factor 2: Management Plan (30 complete list of SPOCs may be found at kits. Points) the following Web site: http:// 6. Other Submission Requirements www.whitehouse.gov/omb/grants/ The applicant’s staffing, scheduling, spoc.html. The due date for State All applicants are required to obtain and logistics plans will be evaluated for process recommendations is 60 days a Data Universal Numbering System their effectiveness in committing after the application deadline. The (DUNS) number as preparation for doing personnel and resources to provide OWH does not guarantee that it will business electronically with the Federal high-quality service and products accommodate or explain its responses to Government. The DUNS number must within the time frames set-forth. This State process recommendations received be obtained prior to applying for OWH evaluation is based on the following: • after that date. (See ‘‘Intergovernmental funds. The DUNS number is a nine- Realism of the proposed time line Review of Federal Programs’’, Executive character identification code provided and the personnel and resources Order 12372, and 45 CFR part 100 for by the commercial company Dun & assigned to complete each requirement. • a description of the review process and Bradstreet, and serves as a unique Appropriateness of the proposed requirements.) identifier of business entities. There is number of hours estimated for each no charge for requesting a DUNS requirement and each staff member. 5. Funding Restrictions number, and you may register and • Adequacy of organizational Grant funds may be used to cover obtain a DUNS number by either of the structure. • costs of: following methods: Adequacy of proposed plan to • Personnel. Telephone: 1–866–705–5711. identify and solve potential problems. • • Consultants. Web site: https://www.dnb.com/ Adequacy of proposed plan to • Office supplies and software. monitor and report on program progress • product/eupdate/ Group counseling sessions, requestOptions.html. and ensure effective communication promotional and evaluation materials. between program staff members and the • Be sure to click on the link that reads, Screening supplies and equipment. ‘‘DUNS Number Only’’ at the right OWH. • Grant related travel (domestic only). • hand, bottom corner of the screen to C. Factor 3: Experience and Other grant related costs. access the free registration page. Please Grant funds may not be used for: Commitment of Key Personnel (20 note that registration via the Web site • Building alterations or renovations. Points) • Computers. may take up to 30 business days to This factor covers the qualifications of • Construction. complete. key personnel proposed to perform the • Food. V. Application Review Information work assigned to them and the amount • Fund raising activities. of effort estimated for each person. This • Medical treatment or therapy. 1. Criteria evaluation is based on the following: • Political education and lobbying. The technical review of applications • Experience, counseling, and • Other activities that are not grant will consider the following 5 factors: professional credentials of proposed key related. personnel on similar projects and in A. Factor 1: Program Plan (40 Points) Guidance for completing the budget related fields (similar projects must can be found in the Program Guidelines, This factor will be evaluated by rating convey similarity in topic, dollar value, which are included with the complete the applicant’s approach to workload, duration, and complexity). application kits. The allowability, accomplishing each of the requirements • Appropriateness of each person’s allocability, reasonableness and identified in the funding opportunity skills and experience for performing the necessity of direct and indirect costs description as demonstrated by the requirements in the funding opportunity that may be charged to OPHS grants are following: description. outlined in the following documents: • Demonstrated understanding of the OMB Circular A–21 (Institutions of scope, goals, and objectives of the work D. Factor 4: Past Performance (10 Higher Counseling); OMB Circular A–87 required and the applicability and Points) (State and Local Governments); OMB clarity of the overall approach. This factor will evaluate the Circular A–122 (Nonprofit • Discussions detailing how each of applicant’s experiences and success in Organizations); and 45 CFR part 74, the requirements will be performed and implementing and managing similar Appendix E (Hospitals). Copies of the the appropriateness of all proposed projects in number, size, complexity. Office of Management and Budget methodologies and analyses. The applicant should describe its (OMB) Circulars are available on the • Identification of potential problems experiences and successes that will Internet at http://www.whitehouse.gov/ and intended solutions. reflect the following: omb/grants/grants_circulars.html. In • Discussions detailing the criteria • Relevant previous experience may order to claim indirect costs as part of used for selecting sites, list of selected include, but is not limited to, the a budget request, an applicant sites or locations of sites, and letters of development and implementation of a organization must have an indirect cost support from each site, if possible. comprehensive campaign or group rate, which has been negotiated with the • Discussions of curriculum, counseling program aimed at improving Federal government. The Health and including samples of the existing the health of women and/or men, or

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health behavior modification program, a award site visits and references, Congressional, Departmental, and cardiovascular disease prevention and program needs, geographic location, and public requests for information about risk modification program delivered in stated preferences. the program. Grantees shall prepare a a national faith-based or national VI. Award Administration Information progress report that outlines the status community organization. and progression of the project every 3 • Training received by its staff 1. Award Notices: The OWH does not months. Grantees will be informed of release information about individual members on how to implement a the exact progress report due dates and applications during the review process cardiovascular program for minority means of submission after the award is women with high-risk for heart disease. until final funding decisions have been made. The final report must describe all • Applicant’s adherence to schedules made. When final funding decisions and budgets, effectiveness of program have been made, the applicant’s project activities for the entire 18-month management, willingness to cooperate authorized representative will be period of the program including data when difficulties arise, general notified of the outcome of their analysis and program evaluation. The compliance with the terms of the grants, application electronically via the financial reports will be submitted to and acceptability of delivered products. eGrants system and followed up by the Project Officer by the first postal mail. The official document anniversary date of the award and the 2. Review and Selection Process notifying an applicant that an final financial report will be included as Applications will be screened upon application has been approved for an appendix to the grant’s final report receipt. Those that are judged to be funding is the Notice of Grant Award no later than 90 days after the close of incomplete or arrive after the deadline signed by the Grants Management the Project Period. OWH shall provide will be returned without review or Officer, which specifies to the grantee an outline of the final report format and comment. If funding is requested in an the amount of money awarded, the templates for required tables. A draft of amount greater than the ceiling of the purposes of the grant, the length of the the final report must be submitted six award range ($100,000 for an 18-month project period, terms and conditions of weeks prior to the end date of the budget period), the application will be the grant award, and the amount of award. OWH will review the draft. considered non-responsive and will not funding to be contributed by the grantee Suggested revisions will be discussed be entered into the review process. The to project costs. individually during a conference call application will be returned with 2. Administrative and National Policy notification that it did not meet the Requirements: The regulations set out at with each grantee. The mutually agreed submission requirements. 45 CFR parts 74 and 92 are the upon revisions must be incorporated The OPHS Office of Grants Department of Health and Human into the final report by the end date of Management will notify applicants that Services (DHHS) rules and requirements the award. are judged to be in compliance. that govern the administration of grants. The grantee shall assign one staff Accepted applications will be evaluated Part 74 is applicable to all recipients member to participate in a committee based on the criteria listed in Section except those covered by part 92, which with other grantees and OWH to prepare V.1 and reviewed for technical merit in governs awards to state and local a joint manuscript suitable for a peer- accordance with DHHS policies. governments. Applicants funded under reviewed journal. This manuscript shall Applicants are advised to pay close this announcement must be aware of combine and summarize data from all attention to the specific program and comply with these regulations. The programs into one final evaluation. The requirements and general instructions in CFR volume that includes parts 74 and jointly prepared manuscript must be the application kit and to the definitions 92 may be downloaded from http:// submitted two weeks prior to the end provided in this notice. www.access.gpo.gov/nara/cfr/ date of award. Applications will be evaluated by a waisidx_03/45cfrv1_03.html. technical review panel composed of The DHHS Appropriations Act VII. Agency Contact(s) experts in the fields of program requires that when issuing statements, management, cardiovascular disease, press releases, requests for proposals, For application kits and information minority community outreach and bid solicitations, and other documents on budget and business aspects of the health counseling, and community- describing projects or programs funded application, please contact: Office of based research. Consideration for award in whole or in part with Federal money, Grants Management, Office of Public will be given to applicants that best grantees shall clearly state the Health and Science, Department of demonstrate the potential to design a percentage and dollar amount of the Health and Human Services, 1101 program that achieves the program goals total costs of the program or project Wootton Parkway, Suite 550, Rockville, stated in this announcement. which will be financed with Federal MD 20857. Telephone: 240–453–8822. The Federal government may conduct money and the percentage and dollar Questions regarding programmatic pre-award site visits of applicants with amount of the total costs of the project information and/or requests for scores in the funding range prior to final or program that will be financed by non- technical assistance in the preparation selection. References may also be governmental sources. requested from these applicants and 3. Reporting: Grantees will submit of the ‘‘Project Narrative’’ should be contacted to better evaluate prior five progress reports, a final report, and directed in writing to: Dr. Suzanne relevant experience. Any applicant who two final Financial Status Reports in the Haynes, Senior Science Advisor, Office believes the Government will find format established by the OWH, in on Women’s Health, Office of Public derogatory information as a result of accordance with provisions of the Health and Science, Department of checking the past performance record general regulations which apply under Health and Human Services, 200 may provide an explanation and any ‘‘Monitoring and Reporting Program Independence Avenue, SW., Rm 719E, remedial action taken by its company to Performance’’, 45 CFR parts 74 and 92. Washington, DC 20201. Telephone: address the problem. Funding decisions The purpose of the progress reports and 202–205–2623. E-mail: will be made by the OWH, and will take final report is to provide accurate and [email protected]. into consideration the recommendations timely program information to program and ratings of the review panel, pre- managers and to respond to

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VIII. Other Information compared to 10% of men who have • The association between Type 2 heart attacks (2). diabetes and heart disease is stronger in 1. Background • About 35% of women and 18% of women than in men; Type 2 diabetes A. Agencies men heart attack survivors will have increases a woman’s risk of developing another heart attack within six years (2). The OWH coordinates the efforts of heart disease by 3 to 7 times, compared • About 46% of women become all the DHHS agencies and offices to 2 to 3 times in men (14). disabled with heart failure within 6 • involved in women’s health. OWH New evidence indicates that C- years of having a heart attack compared works to improve the health and well reactive protein may be a stronger risk to 22% of men (2). being of women and girls in the United factor in men than in women (15). • Some evidence indicates that • The Women’s Health Initiative States through its innovative programs women suffer more short and long-term study found that a common menopausal by educating health professionals and disability after having a stroke than men hormone therapy offered to women— motivating behavior change in (4, 5). estrogen plus progestin—increased the consumers through the dissemination of • Perioperative complications and risk of heart disease in postmenopausal health information. To that end, the mortality after percutaneous angioplasty women (16). OWH has established public/private and coronary artery bypass surgery are partnerships that address the major also higher in women than in men (6). C. High-Risk Groups killer of women—cardiovascular disease • More women than men in the Some groups of women have higher (CVD). One such partnership is with the United States have the following five rates of CVD mortality than other National Heart, Lung, and Blood major risk factors for CVD: high blood women and/or a higher prevalence of Institutes (NHLBI), which is targeting pressure, high cholesterol, Type 2 factors that increase the risk of CVD women aged 40–60 years and their diabetes, physical inactivity, and mortality and morbidity. These high- health care providers, through a obesity (3). risk groups of women include women national educational campaign called Some experts speculate that the aged 40 years and older and racial and the Heart Truth Campaign. difference in CVD outcomes and risk ethnic minority women. The Office of Research on Women’s factor prevalence between women and Health at the National Institutes of men may be due, in part, to a lack of i. Women Aged 40 Years and Older Health (ORWH/NIH) promotes, awareness among women and their A woman’s risk of CVD starts to rise stimulates, and supports efforts to physicians of the risks for CVD in between the ages of 40 and 60; thus, improve the health of women through women (6, 7). behavioral modification programs that biomedical and behavioral research. • A 2003 national survey conducted target women aged 40 years and older ORWH/NIH works in partnership with by the American Heart Association have the potential to prevent CVD from the NIH institutes and centers to ensure found that 35% of women cite breast developing. that women’s health research is part of cancer as their greatest health threat • The incidence of CVD increases the scientific framework at NIH and while only 13% of women believe that with age, and over 97% of people who throughout the scientific community. their greatest health threat is heart die of CVD are age 40 years or older Both the OWH and the ORWH/NIH are disease (8). However, more women die (17). committed to reducing the death and of heart disease than of all cancers • CVD risk factors including obesity, disability due to heart disease and combined. high blood pressure, high LDL stroke. • The majority of women fail to cholesterol levels and Type 2 diabetes The Office of Minority Health (OMH) identify the risk factors for heart often develop around the ages of 40 to mission is to improve and protect the disease, such as high blood pressure and 60 (17) health of racial and ethnic minority high cholesterol (8). • After menopause, heart disease populations through the development of • Physicians tend to rate women as rates in women are 2 to 3 times that of health policies and programs that will being at lower risk for heart disease than women the same age before menopause eliminate health disparities. The OMH men even when the men and women (3). will provide expert and technical have very similar risk profiles (9). • The risk of high blood pressure also support to the OWH during the • A study of over 29,000 routine increases with age; women age 45–54 performance of this grant. physician office visits found that years have double the risk of high blood women were counseled less often than B. Women and Cardiovascular Disease pressure as women under age 45 years men about exercise, nutrition, and (17). Cardiovascular disease (CVD), which weight reduction (10). • About 80% of women age 65 years includes both heart disease and stroke, • The results of the 2003 national and older have high blood pressure (18). is the leading cause of death for women survey found that only 38% of women • Only 18% of women age 65 years in the United States (2). Compared to reported that their doctors had ever and older report engaging in regular men, women have higher CVD discussed heart disease with them (8). leisure time physical activity compared mortality, higher morbidity following a Women and health care providers are to 59% of the total population of women heart attack or stroke, lower awareness often ill informed about the differences (19). of CVD, and a higher prevalence of most between male and female signs, major risk factors for CVD. symptoms, and risk factors for heart ii. Racial and Ethnic Minority Women • Since 1984, the number of CVD disease (7, 8, 11, 12). African American women have the deaths for females has exceeded those • The most common heart attack highest age-adjusted heart disease and for males in the United States (3). symptoms in women are different than stroke death rates of any female race/ • In 2002, about 60,000 more U.S. those in men; women are more likely ethnicity group in the United States. women died of CVD than men (3). than men to experience ‘‘atypical’’ Compared to white women, racial and • Each year about 40,000 more symptoms such as nausea, indigestion, ethnic minority women have a higher women than men have a stroke (3). palpitations, dyspnea and fatigue, and prevalence of many major risk factors • Thirty-eight percent of women die they are less likely than men to for CVD. CVD awareness is also lower within one year of having a heart attack experience chest pain (13). among racial and ethnic minority

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groups of women than among white particular, interventions that encourage faith-based and community groups in women. women to establish a healthy weight serving racial and ethnic minority • In 2002, the heart disease death rate and increase their levels of physical women who do not regularly receive was 263.2 per 100,000 for African activity could dramatically affect CVD clinical information and screening. American women compared to 192.1 rates in the United States. 2. Definitions per 100,000 for white women and 197.2 Targeted CVD behavioral modification per 100,000 for all women combined interventions have been successful in For the purposes of this cooperative (17). modifying cardiovascular risk behaviors agreement program, the following • In 2002, the stroke death rate was in women. Such CVD interventions definitions are provided: 71.8 per 100,000 for African American have been administered at various Community-based: The locus of women compared to 53.4 per 100,000 venues, including churches, community control and decision-making powers is for white women and 55.2 per 100,000 health centers, community health located at the community level, for all women combined (17). clinics, YMCAs and other health clubs, representing the service area of the • About 57% of Hispanic/Latino schools, Head Start facilities, etc (10– community or a significant segment of women, 56% of American Indians/ 33). Studies indicate that several aspects the community. Alaska Native women, 42.6% of Asian/ of targeted CVD intervention programs Culturally competent: Information Pacific Islander women and 55% of are particularly effective in modifying and services provided at the educational African American women do not the CVD risk behaviors of women (1, 10, level and in the language and cultural exercise, compared to 38% of white 26, 34–39). These include: context that are most appropriate for the women (3, 20–22). • Personalized risk assessment and individuals for whom the information • About 72% of Mexican-American screening. and services are intended. women, 77% of African American • Daily self-monitoring (log-sheets, High-risk women: Groups of women women and 61% of American Indians/ exercise diaries, etc.). that have higher rates of heart disease Alaska Native women are overweight or • Program and group counseling mortality than other women and/or a obese, compared to 57% of white sessions materials tailored to a woman’s higher prevalence of factors that women (3, 20, 21). stage of the lifecycle, readiness to increase the risk of heart disease • About 37% of American Indians/ change, needs and subgroup affiliation mortality and morbidity. Major risk Alaska Native women smoke compared (e.g. racial group, low socioeconomic factors for heart disease include to 21% of white women (3, 21). status, obese, etc.). smoking, high blood pressure, high LDL • Other CVD risk factors such as Type • Behavioral reinforcement strategies cholesterol, obesity, Type 2 diabetes, 2 diabetes mellitus and high blood such as contracts, verification physical inactivity, age, and family pressure are also more prevalent among procedures, incentives, lotteries and history of heart disease. Information on minority women than among white team building. high risk or risks for heart disease can women (3, 20, 21). • Group sessions that incorporate be found online at http:// • About 26% of Hispanic/Latino physical activity. circ.ahajournals.org/cgi/content/full/ women and 27% of Asian American • Frequent contact via mail and 109/5/672 and http:// women have not had a blood pressure phone. www.guidelines.gov/summary/ screening in the past 12 months, • CVD resource library. summary.aspx.doc_id=3487&nbr =2713&string=lipid. compared to 20% of white women (23). E. Faith-Based and Community • In the 2003 national survey Partnership: A collaboration where Organizations conducted by the American Heart both parties (the grantee and the Association, fewer African-American Faith-based and community national faith-based or national and Hispanic women than white women organizations have a long history of community organization) play a correctly cited heart disease as the providing an array of clinical substantive role during all stages of the leading cause of death among women information and screening to people and program including development, (8). communities in the United States. These implementation and evaluation. Both • The survey also showed that white groups have unique strengths that parties must also be included and women were more likely than women in government cannot duplicate. They consulted when decisions are made on other racial/ethnic groups to correctly hold the trust of their community all aspects of the program. identify the major risk factors and neighbors and leaders and have great National faith-based organization: warning signs of heart attack and stroke understanding of the needs of the The national organizing, (8, 24). community and its systems. representational, policy making or Furthermore, the sense of mission from leadership entity for several faith-based D. Cardiovascular Disease Interventions which these organizations work often member units/sites (e.g., churches, Cardiovascular disease (CVD) translates into a unique approach to synagogues, etc.) that are located in prevention programs that target high- service delivery, a dedication of service communities in multiple states across risk women, particularly racial/ethnic to others, and a cultural awareness the United States. It is a non-profit minority women age 40 years and older, specific to their surrounding organization that has a grassroots have the potential to reduce CVD communities. network of contributing members. incidence and mortality in the United In recognition of this history and National community organization: States. Counseling is an essential ability, President Bush believes it is in The national organizing, component of cardiovascular health the public’s interest to broaden Federal representational, policy making or promotion efforts, and many programs efforts to work with faith-based and leadership entity for several aiming to prevent CVD focus on community organizations, and he has community-based member units/sites counseling as their primary goal. made improving funding opportunities (e.g., health centers, recreational However, risk behavior modification, for such organizations a priority. The centers, sorority chapters, etc.) that are the process of translating knowledge program described in this located in communities in multiple into practice, is pivotal to achieving announcement is a part of this effort to states across the United States. It is also improved health outcomes. In enhance and expand the participation of a non-profit organization that has a

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grassroots network of contributing 9. Mosca L, Linfante AH, Benjamin EJ, et American Stroke Association national survey members. al. National study of physician awareness of stroke risk awareness among women. Racial and Ethnic Minority Women: and adherence to cardiovascular disease Circulation. 2005;111(10):1321–6. American Indian or Alaska Native, prevention guidelines. Circulation 25. Krummel DA, Koffman DM, Bronner Y, Asian, Black or African American, 2005;111(4):499–510. et al. Cardiovascular health interventions in 10. Missed opportunities in preventive Hispanic or Latino, and Native women: What works? J Womens’ Health counseling for cardiovascular disease: United Gend Based Med 2001;10(2):117–36. Hawaiian or Other Pacific Islander. States, 1995. Morbidity and Mortality Weekly 26. van der Bij AK, Laurant MG, Wensing (Revision to the Standards for the Report 1998;47:91–95. M. Effectiveness of physical activity Classification of Federal Data on Race 11. McSweeney JC, Cody M, Crane PB. Do and Ethnicity, Federal Register, Vol. 62, you know them when you see them? interventions for older adults: A review. Am No. 210, pg. 58782, October 30, 1997.) Women’s prodromal and acute symptoms of J Prev Med 2002;22(2):120–33. Target: Put forth effort to ensure that myocardial infarction. J Cardiovasc Nurs 27. Taylor WC, Baranowski T, Young DR. members of a specific group of women 2001;15(3):26–38. Physical activity interventions in low- income, ethnic minority, and populations are aware of the program and that 12. National Institutes of Health. National with disability. Am J Prev Med components of the program are designed Heart Lung and Blood Institute. Women’s Heart Health: Developing a National Health 1998;15(4):334–43. to be effective in reaching those Counseling Action Plan. Strategy 28. Littleton MA, Cornell CE, Dignan M, et populations. This includes creating Development Workshop Report. March 26– al. Lessons learned from the Uniontown program materials that are culturally 27, 2001. NIH Publication No. 01–2963. Community Health Project. Am J Health competent for that specific group of September 2001. Behav 2002;26(1):34–42. women. This also includes training staff 13. Patel H, Rosengren A, Ekman I. 29. Segar M, Jayaratne T, Hanlon J, et al. and health professionals to understand Symptoms in acute coronary syndromes: Fitting fitness into women’s lives: effects of the unique needs, behaviors, cultures does sex make a difference? Am Heart J a gender-tailored physical activity 2004;148(1):27–33. and concerns of members of the specific intervention. Women’s Health Issues group of women. Targeting does not 14. Mosca L, Grundy SM, Judelson D, et al. Guide to Preventive Cardiology for Women. 2002;12(6):338–47. mean excluding other groups of women AHA/ACC Scientific Statement Consensus 30. Lasco RA, Curry RH, Dickson VJ, et al. from the program. panel statement. Circulation 1999;99:2480– Participation rates, weight loss, and blood Women-centered: (1) Taking into 2484. pressure changes among obese women in a account the differences between heart 15. Pai JK, Pischon T, Ma J, et al. nutrition-exercise program. Public Health disease in men and women and (2) Inflammatory markers and the risk of Rep 1989;104(6):640–6. addressing the needs and concerns of coronary heart disease in men and women. 31. Kanders BS, Ullmann-Joy P, Foreyt JP, women in a way that is welcoming to N Engl J Med 2004;351(10):1099–610. et al. The black American lifestyle women, fosters a commitment to 16. Rossouw JE, Anderson GL, Prentice RL, intervention (BALI): the design of a weight women, treats women with dignity, and et al. Risks and benefits of estrogen plus loss program for working-class African- empowers women through respect and progestin in healthy postmenopausal women: American women. J Am Diet Assoc principal results from the Women’s Health counseling. 1994;94(3):310–2. Initiative randomized controlled trial. JAMA 32. Manfredi C, Mermelstein R, et al. The 3. References 2002;288:321–333. Head Start parent involvement program as a 17. Center for Disease Control and vehicle for smoking reduction intervention. 1. Prochaska JO, DiClemente CC, Norcross Prevention (CDC). National Center for Health JC. In search of how people change. Fam Community Health 1994;17:1 Statistics. Health, United States, 2004 With 33. Yanek LR, Becker DM, Moy TF, et al. Applications to addictive behaviors. Am Chartbook on Trends in the Health of Project Joy: faith based cardiovascular health Psychol 1992;47(9):1102–14. Americans. Hyattsville, Maryland: 2004. 2. American Heart Association. Heart 18. American Heart Association. Older promotion for African American women. Disease and Stroke Statistics’ 2005 Update. Americans and Cardiovascular Diseases— Public Health Rep 2001;116 Suppl 1:68–81. Dallas, Texas: American Heart Association; Statistics. Dallas, Texas: American Heart 34. Burke LE, Dunbar-Jacob, JM, Hill MN. 2005. Association; 2005. Compliance with cardiovascular disease 3. American Heart Association. Women 19. Federal Interagency Forum on Aging- prevention strategies: a review of the and Cardiovascular Diseases’ Statistics. Related Statistics. Older Americans 2004: research. Annals of Behavioral Medicine Dallas, Texas: American Heart Association; Key Indicators of Well-Being. Federal 1997;19(3):239–263. 2005. Interagency Forum on Aging-Related 35. Madsen J, Sallis J, Rupp J, et al. Process 4. Di Carlo A, Lamassa M, Baldereschi M, Statistics, Washington, DC: U.S. Government variables as a predictor of risk factor change et al. Sex differences in the clinical Printing Office. November 2004. presentation, resource use, and 3-month in health behavior change program. Health 20. American Heart Association. outcome of acute stroke in Europe: data from Counseling Research 1993;8(2), 193–204. a multicenter multinational hospital-based Hispanics/Latinos and Cardiovascular 36. Becker DM, Yanek LR, Moy TF, et al. registry. Stroke 2003;34(5):1114–9. Diseases—Statistics. Dallas, Texas: American Community Prevention Research in Women’s 5. Roquer J, Campello AR, Gomis M. Sex Heart Association; 2005. Health Conference, NIH. Bethesda, MD. 2000. differences in first-ever acute stroke. Stroke 21. American Heart Association. American 37. Lefebvre RC, Lasater TM, Carleton RA, 2003;34(7):1581–5. Indians/Alaska Natives and Cardiovascular Peterson G. Theory and delivery of health 6. Grady D, Chaput L, Kristof M. Results of Diseases Statistics. Dallas, Texas: American programming in the community: The Heart Association; 2005. Systematic Review of Research on Diagnosis Pawtucket Heart Health Program. Preventive 22. American Heart Association. Asian/ and Treatment of Coronary Heart Disease in Medicine 1987;16(1):80–95. Pacific Islanders and Cardiovascular Diseases Women. Evidence Report/Technology 38. Flack JM, Wiist WH. Cardiovascular Assessment No. 80. AHRQ Publication No. Statistics. Dallas, Texas: American Heart Association; 2005. risk factor prevalence in African American 03–0035. Rockville, MD: Agency for adult screenees for a church-based Healthcare Research and Quality. May 2003. 23. National Institutes of Health. National cholesterol counseling program: The 7. Practice News. Red Dress Attracts New Heart, Lung and Blood Institute. Seventh Attention to Heart Disease in Women. Report of the Joint National Committee on Northeast Oklahoma Cholesterol Counseling Cardiology 2003;32(7):1–4. Prevention, Detection, Evaluation, and Program. Ethnicity & Disease 1991;1:78–90. 8. Mosca L, Ferris A, Fabunmi R, Robertson Treatment of High Blood Pressure (JNC 7) 39. Farquhar J, Fortmann S, Flora J, et al. RM; American Heart Association. Tracking Express. NIH Publication No. 03—5233. Effects of community-wide counseling on women’s awareness of heart disease: an December 2003. cardiovascular disease risk factors. The American Heart Association national study. 24. Ferris A, Robertson RM, Fabunmi R, et Stanford Five-City Project. JAMA Circulation 2004;109(5):573–9. al. American Heart Association and 1990;264(3);359–365.

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Dated: May 24, 2006. Background and Brief Description computer-assisted telephone Frances Ashe-Goins, The NHHCS was conducted in 1992, interviewing (CATI) systems. These Acting Director for Health (Women’s Health). 1993, 1994, 1996, 1998, and 2000. computerized systems speed the flow of [FR Doc. 06–5135 Filed 6–5–06; 8:45 am] NHHCS data describe a major segment data, making it possible to release information on a timelier basis and BILLING CODE 4150–33–P of the long-term care system and are used extensively for health care easier for respondents to participate in research, health planning and public the survey. policy. NHHCS provides data on the Users of NHHCS data include the DEPARTMENT OF HEALTH AND characteristics of home health and National Immunization Program, and HUMAN SERVICES hospice agencies (e.g. Medicare and the National Center for Injury Medicaid certification, ownership, Prevention and Control CDC; the Centers for Disease Control and membership in chains, nursing home, or Congressional Research Office; the Prevention hospital systems); patients (e.g. Bureau of Health Professions, Health demographics, functional status, Resources and Services Administration; [30Day–06–0298] services received, diagnoses, or sources the Office of the Assistant Secretary for of payment); and staff (e.g. staffing mix, Planning and Evaluation; the Agency for Agency Forms Undergoing Paperwork turnover, benefits, training, or Healthcare Research and Quality; the Reduction Act Review education). National Association for Health Care; The survey provides detailed the National Hospice and Palliative Care The Centers for Disease Control and information on utilization and staffing Organization; American Health Care Prevention (CDC) publishes a list of patterns, and quality of care variables Association; Centers for Medicare and that are needed to make accurate information collection requests under Medicaid Services; Bureau of the assessments of the need for and effects review by the Office of Management and Census, and the American Association of changes in the provision and Budget (OMB) in compliance with the for Retired People. Other users of these financing of long-term care for the Paperwork Reduction Act (44 U.S.C. data include universities, many in the elderly and disabled. The availability Chapter 35). To request a copy of these and use of long-term care services are private sector, foundations, and a requests, call the CDC Reports Clearance becoming an increasingly important variety of users in the print media. Officer at (404) 639–5960 or send an e- issue as the number of elderly increases NCHS plans to conduct the next mail to [email protected]. Send written and persons with disabilities live NHHCS in August–December 2007 and comments to CDC Desk Officer, Office of longer. Equally as important is ensuring during the same months in 2008. These Management and Budget, Washington, the adequacy and availability of the two national surveys follow a pretest of DC or by fax to (202) 395–6974. Written long-term care workforce. The 2007 the forms and procedures in August- comments should be received within 30 NHHCS will include a supplement on September 2006. The data collection days of this notice. home health aides. The upcoming procedures and content have been Proposed Project survey has been redesigned and extensively revised from those of the expanded to better meet the data needs previous NHHCS. There is no cost to National Home and Hospice Care of researchers and health care planners respondents other than their time to Survey (NHHCS)(OMB No. 0920– working to ensure that quality long-term participate. The burden tables below 0298)—Reinstatement with Change— care will be available for the nation’s include the average annual burden for National Center for Health Statistics growing senior population. The survey the pretest and the national survey. The (NCHS), Centers for Disease Control and will utilize both computer-assisted total estimated annualized burden hours Prevention. personal interviewing (CAPI) and are 6,088.

ESTIMATED ANNUALIZED BURDEN HOURS—PRETEST

Average Number of Number of burden/re- Respondents respondents responses/ sponse respondent (in hours)

Agency level data collection (CAPI) ...... 17 1 30/60 Agency Staff Questionnaire ...... 17 1 50/60 Current or Discharge Patient Sampling (CAPI) ...... 17 1 20/60 Current Home Health Patient Data Collection (CAPI) ...... 8 4 25/60 Hospice Discharge Patient Data Collection (CAPI) ...... 9 4 25/60 Home Health Aide Sampling (CAPI) ...... 17 1 15/60 Home Health Aide Data Collection (CATI) ...... 133 1 40/60

ESTIMATED ANNUALIZED BURDEN HOURS—NATIONAL SURVEY

Number of Average Respondents Number of responses/ burden/re- respondents respondent sponse (in hours)

Agency level data collection (CAPI) ...... 820 1 30/60 Agency Staff Questionnaire ...... 820 1 50/60 Current or Discharge Patient Sampling (CAPI) ...... 820 1 20/60 Current Home Health Patient Data Collection (CAPI) ...... 410 8 25/60 Hospice Discharge Patient Data Collection (CAPI) ...... 410 8 25/60

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ESTIMATED ANNUALIZED BURDEN HOURS—NATIONAL SURVEY—Continued

Average Number of Number of burden/re- Respondents respondents responses/ sponse respondent (in hours)

Home Health Aide Sampling (CAPI) ...... 433 1 15/60 Home Health Aide Data Collection (CATI) ...... 2,598 1 40/60

Dated: May 31, 2006. DC or by fax to (202) 395–6974. Written national level in healthcare facilities. Betsey Dunaway, comments should be received within 30 The information gained from this Acting Reports Clearance Officer, Centers for days of this notice. assessment will be used to target Disease Control and Prevention. corrective actions or educational Proposed Project [FR Doc. E6–8702 Filed 6–5–06; 8:45 am] strategies to improve the public’s health BILLING CODE 4163–18–P Assessment of Healthcare-associated by preventing future adverse events. Adverse Events—New—National Center To rapidly determine the scope of for Infectious Diseases (NCID), Centers adverse events at the time soon after a DEPARTMENT OF HEALTH AND for Disease Control and Prevention public health notification or product HUMAN SERVICES (CDC). recall, DHQP seeks to conduct short surveys using OMB approved questions Background and Brief Description Centers for Disease Control and among participants in the Rapid Prevention The Division of Healthcare Quality Notification System, National Promotion (DHQP) disseminates notices Nosocomial Infection Surveillance [30Day–06–0463x] and alerts through a voluntary (NNIS), and other CDC networks (e.g., Agency Forms Undergoing Paperwork electronic mail subscriber list (i.e., partners in healthcare working on Reduction Act Review Rapid Notification System) to inform innovative infection reduction projects healthcare personnel about healthcare- such as the Pittsburgh Healthcare The Centers for Disease Control and associated disease outbreaks and Regional Initiative and the Prevention Prevention (CDC) publishes a list of clusters or adverse events that may be Epidemiology Centers). The survey will information collection requests under of national importance and also be posted on the DHQP website to review by the Office of Management and recommendation for preventing reach additional healthcare Budget (OMB) in compliance with the infections and antimicrobial resistance. professionals. The number of questions Paperwork Reduction Act (44 U.S.C. DHQP is occasionally involved in in each survey will range from 5 to 10. Chapter 35). To request a copy of these gathering information to determine if a Data will be collected using a Web- requests, call the CDC Reports Clearance recognized adverse event (e.g., an based data collection form. Officer at (404) 639–5960 or send an e- infection following the use of a There are no costs to the respondents mail to [email protected]. Send written particular product, type of equipment, other than their time. The total comments to CDC Desk Officer, Office of or with a microorganism that has rarely estimated annualized burden hours are Management and Budget, Washington, been reported) has occurred on a 67.

ESTIMATED ANNUALIZED BURDEN HOURS

Number of Respondents Number of responses per Average respondents respondent burden hours

Healthcare professionals ...... 400 1 10/60

Dated: May 15, 2006. DEPARTMENT OF HEALTH AND Place: Centers for Disease Control and Joan F. Karr, HUMAN SERVICES Prevention, Roybal Campus, Tom Harkin Global Communications Center, Room 232 Acting Reports Clearance Officer, Centers for (Auditorium B), 1600 Clifton Road, Atlanta, Disease Control and Prevention. Centers for Disease Control and Prevention Georgia 30333, telephone (404) 639–3311. [FR Doc. E6–8714 Filed 6–5–06; 8:45 am] Status: Open to the public, limited only by BILLING CODE 4163–18–P the space available. Guide to Community Preventive Purpose: The mission of the Task Force is Services (GCPS) Task Force to develop and publish the Guide to Community Preventive Services, which is In accordance with section 10(a)(2) of based on the best available scientific the Federal Advisory Committee Act evidence and current expertise regarding (Pub. L. 92–463), the Centers for Disease essential public health and what works in the Control and Prevention (CDC) announce delivery of those services. the following meeting: Matters To Be Discussed: Agenda items include: Seating of five new Task Force Name: Task Force on Community members, briefings on administrative Preventive Services. information, violence prevention, adolescent Times and Dates: 8 a.m.–6 p.m., June 14, sexual behavior, worksite health promotion 2006. 9 a.m.–1:30 p.m., June 15, 2006. and the assessment of health risks with

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feedback, communicating economic findings, DEPARTMENT OF HEALTH AND procedures and approve them if they adolescent health, and dissemination HUMAN SERVICES meet the requirements. If the procedure activities and projects in which the fail to address or meet the requirements, Community Guide is utilized. Administration for Children and States will be given 60 days to revise Agenda items are subject to change as Families and correct them. If a State fails to priorities dictate. establish, submit or correct the Persons interested in reserving a space for Agency Recordkeeping/Reporting procedures within specified timeframes, this meeting should call Detrice Sherman, Requirements Under Emergency the State will be liable for a full five MPH at (404) 498–0979 by close of business Review by the Office of Management percent penalty for the year. and Budget (OMB) on June 9, 2006. • A modification/reduction and Contact Person for Additional Information: Title: Interim Final Rule for the replacement of the predecessor caseload Randy Elder, PhD, Community Guide Reauthorization of the Temporary reduction credit information collection Branch, Coordinating Center for Health Assistance for Needy Families Program. based on the recalibration of the Information and Service, National Center for OMB No.: New Collection. caseload reduction credit. Health Marketing, Division of Health Description: The Interim Final Rule • A modification and replacement of Communication and Marketing Strategy, for the Reauthorization of the 4770 Buford Highway, M/S E–69, Atlanta, the predecessor reasonable cause/ Temporary Assistance for Needy corrective compliance information GA 30333; (404) 498–0953. Families Program imposes some new collection based on the requirements of requirements and replaces others. They Dated: May 26, 2006. the participation rate verification James D. Seligman, are: • A new requirement that States procedures. Chief Information Officer, Centers for Disease • establish documentation, verification A modification and replacement of Control and Prevention. and internal control procedures to the predecessor TANF Data Report and [FR Doc. E6–8703 Filed 6–5–06; 8:45 am] ensure valid work-participation rates, the SSP–MOE Data Report based on BILLING CODE 4163–18–P based on regulatory specifications. how we define work-eligible States will be required to submit the individuals, especially with regard to procedures to the Department of Health child-only cases. and Human Services no later than Respondents: The 50 States of the September 30, 2006. The United States, the District of Columbia, Administration for Children and Guam, Puerto Rico, and the Virgin Families (ACF) will review the Islands.

ANNUAL BURDEN ESTIMATES

Number of Average burden Instrument Number of responses per hours per Total burden respondents respondent response hours

Preparation and Submission of Data Verification Procedures— § 261.60–§ 261.63 ...... 54 1 640 34,560 Caseload Reduction Documentation Process, ACT–202—§ 261.41 & § 261.44 ...... 54 1 120 6,480 Reasonable Cause/Corrective Compliance Documentation Process— § 262.4, 262.6, & 262.7; § 261.51 ...... 54 2 240 25,920 TANF Data Report—Part 265 ...... 54 4 2,193 473,688 SSP–MOE Data Report—Part 265 ...... 29 4 714 82,824

Estimated Total Annual Burden Hours ...... 623,472

Additional Information: ACF is Officer for ACF, E-mail address: SUMMARY: This notice publishes the requesting that OMB grant a 180-day [email protected]. Liquor Control Ordinance of the Eastern approval for this information collection Dated: May 30, 2006. Shawnee Tribe of Oklahoma (Tribe). under procedures for emergency Robert Sargis, The Ordinance regulates and controls processing by June 28, 2006. A copy of Reports Clearance Officer. the possession, sale and consumption of this information collection, with [FR Doc. 06–5116 Filed 6–5–06; 8:45 am] liquor within the tribal lands of the applicable supporting documentation, Tribe. The tribal lands are located on BILLING CODE 4184–01–M may be obtained by calling the trust land and this Ordinance allows for Administration for Children and possession and sale of alcoholic Families, Reports Clearance Officer, beverages within their exterior Robert Sargis at (202) 690–7275. E-mail DEPARTMENT OF THE INTERIOR boundaries. This Ordinance will address: [email protected]. increase the ability of the Tribal Bureau of Indian Affairs Comments and questions about the government to control the community’s information collection described above Liquor Control Ordinance of the liquor distribution and possession, and should be directed to the following Eastern Shawnee Tribe of Oklahoma at the same time will provide an address by June 28, 2006: Office of important source of revenue for the AGENCY: Bureau of Indian Affairs, continued operation and strengthening Information and Regulatory Affairs, Interior. Office of Management and Budget, of the tribal government and the ACTION: Paperwork Reduction Project, Desk Notice. delivery of tribal services.

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DATES: Effective Date: This Ordinance is and to achieve maximum economic rectified spirits, potable alcohol, beer, effective on June 6, 2006. benefit to the Tribe. wine, brandy, whiskey, rum, gin, FOR FURTHER INFORMATION CONTACT: c. The introduction, possession and aromatic bitters, and all drinks or Charles Head, Tribal Government sale of liquor on tribal lands is a matter drinkable liquids and all preparations or Services Officer, Eastern Oklahoma of special concern to the Eastern mixtures capable of human Regional Office, 3100 W. Peak Blvd., Shawnee Business Committee. consumption and any liquid, semisolid, d. The Eastern Shawnee Business Muskogee, OK 74402, Telephone: (918) solid, or other substances, which Committee finds that a complete ban on 781–4685, Fax (918) 781–4649; or Ralph contain more than one half of one liquor on tribal lands is ineffective and Gonzales, Office of Tribal Services, 1849 percent of alcohol. unrealistic. However, it recognizes the C Street, NW., Mail Stop Room 4513– g. Liquor Control Board. The Eastern need for strict regulation and control MIB, Washington, DC 20240; Shawnee Liquor Control Board as over liquor transactions on tribal lands Telephone: (202) 513–7629. established by Section 3 of this because of the many potential problems Ordinance. SUPPLEMENTARY INFORMATION: Pursuant associated with the unregulated or h. Liquor store. Any store at which to the Act of August 15, 1953, Public inadequately regulated sale, possession, liquor is sold and, for the purpose of Law 83–277, 67 Stat. 586, 18 U.S.C. distribution and consumption of liquor this Ordinance, includes stores where 1161, as interpreted by the Supreme e. Federal law forbids the only a portion of which are devoted to Court in Rice v. Rehner, 463 U.S. 713 introduction, possession, and sale of sale of liquor or beer. (1983), the Secretary of the Interior shall liquor in Indian country except when i. Malt liquor. Beer, strong beer, ale, certify and publish in the Federal the same is in conformity both with the stout or porter. Register notice of adopted liquor laws of the State and the Tribe, 18 j. Package. Any container or ordinances for the purpose of regulating U.S.C. 1161. As such, compliance with receptacle used for holding liquor. liquor transactions in Indian country. this ordinance shall be in addition to, k. Public place. Federal, state, county, The Business Committee of the Eastern and not substitute for, compliance with or tribal highways and roads; buildings Shawnee Tribe of Oklahoma (Business the laws of the State of Oklahoma. and grounds used for school purposes; Committee) adopted its Liquor f. This ordinance governs the sale, public dance halls and grounds adjacent Ordinance by Resolution No. 011806– purchase, and distribution of alcohol on thereto; soft drink establishments, R–03 on January 18, 2006. This Liquor Tribal lands within the exterior public buildings, public meeting halls, Ordinance will be the first published in boundaries of the Tribe’s former lobbies, halls and dining room of hotels, the Federal Register for the Tribe. The reservation. restaurants, theaters, gaming facilities, purpose of this Ordinance is to govern Section 2. Definitions entertainment centers, stores, garages, the sale, possession and distribution of and filling stations which are open to alcohol within tribal lands of the Tribe. As used in this ordinance, the following words shall have the and/or generally used by the public and This notice is published in accordance to which the public is permitted to have with the authority delegated by the following meanings unless the context clearly require otherwise: generally unrestricted access; public Secretary of the Interior to the Principal conveyances of all kinds and character; Deputy Assistant Secretary—Indian a. Alcohol. That substance known as ethyl alcohol, hydrated oxide of ethyl, and all other places of like or similar Affairs. I certify that this Liquor nature to which the general public has Ordinance of the Eastern Shawnee Tribe alcohol, hydrated oxide of ethyl, ethanol, or spirits of wine, from unrestricted right of access, and which of Oklahoma was duly adopted by the are generally used by the public. Business Committee on January 18, whatever source or by whatever process l. Sale and sell. The exchange, barter 2006. produced. b. Alcoholic beverage. This term is and traffic, including the selling or Dated: May 30, 2006. synonymous with the term liquor as supplying or distributing, by any means Michael D. Olsen, defined in paragraph (f) of this Section. whatsoever, of liquor, or of any liquid Acting Principal Deputy Assistant Secretary— c. Bar. Any establishment with known or described as beer or by any Indian Affairs. special space and accommodations for name whatsoever commonly used to The Eastern Shawnee Tribe of the sale of liquor by the glass and for describe malt or brewed liquor or of Oklahoma Liquor Ordinance reads as consumption on the premises as herein wine by any person to any person. follows: defined. m. Spirits. Any beverage which d. Beer. Any beverage obtained by the contains alcohol obtained by Eastern Shawnee Tribe of Oklahoma alcoholic fermentation of an infusion or distillation, including wines exceeding Liquor Control Ordinance decoction of pure hops, or pure extract seventeen percent of alcohol by weight. Section 1. Declaration of Public Policy of hops and pure barley malt or other n. Tribal Court. Refers to the Eastern and Purpose wholesome grain or cereal in pure water Shawnee Tribal Court or, in accordance and containing the percent of alcohol by with Article X of the Constitution of the a. The Eastern Shawnee Business volume subject to regulation as an Eastern Shawnee Tribe of Oklahoma, Committee, in accordance with Article intoxicating beverage in the state where the Court of Indian Offenses, more IX, section 1 of the Constitution of the the beverage is located. specifically designated for purposes of Eastern Shawnee Tribe of Oklahoma, is e. Business Committee. The governing this Ordinance as 25 CFR Court located authorized to enact resolutions, body of the Eastern Shawnee Tribe of at the Miami Agency of the Bureau of ordinances, and act on behalf of the Oklahoma, as defined in the Tribal Indian Affairs in Miami, Oklahoma. Eastern Shawnee Tribe. Constitution. o. Tribal lands. Any or all land over b. The Eastern Shawnee Business f. Liquor. All fermented, spirituous, which the Tribe exercises governmental Committee finds that tribal control and vinous, or malt liquor or combinations power and that is either held in trust by regulation of liquor is necessary to thereof, and mixed liquor, a part of the United States for the benefit of the protect the health and welfare of tribal which is fermented, and every liquid or Tribe or individual members of the members, to address specific concerns solid or semisolid or other substance, Tribe, or held by the Tribe or individual relating to alcohol use on tribal lands, patented or not, containing distilled or members of the Tribe subject to

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restrictions by the United States against other persons as shall be reasonably b. Sales for Cash. All liquor sales on alienation. necessary to allow the Liquor Control tribal lands shall be on a cash only basis p. Wine. Any alcoholic beverage Board to perform its function. and no credit shall be extended to any obtained by fermentation of the natural (3) Issue licenses permitting the sale person, organization, or entity, except contents of fruits, vegetables, honey, or manufacture or distribution of liquor that this provision does not prevent the milk or other products containing sugar, on tribal lands. payment for purchases with use of whether or not other ingredients are (4) Hold hearings on violations of this credit cards such as Visa, Master Card, added, to which any saccharine Ordinance or for the issuance of American Express, etc. substances may have been added before, revocation of licenses hereunder. c. Sale for Personal Consumption. All during or after fermentation, and (5) Bring suit in the Tribal Court or sales shall be for the personal use and containing not more than seventeen other appropriate court to enforce this consumption of the purchaser. Resale of percent of alcohol by weight, including Ordinance as necessary. any alcoholic beverages on tribal lands sweet wines fortified with wine spirits, (6) Determine and seek damages for is prohibited. Any person who is not such as port, sherry, muscatel and violation of this Ordinance. licensed pursuant to this Ordinance angelia, not exceeding seventeen (7) Make such reports as may be who purchases an alcoholic beverage on percent of alcohol by weight. required by the Eastern Shawnee tribal lands and sells it, whether in the Business Committee. original container or not, shall be guilty Section 3. Eastern Shawnee Liquor (8) Collect taxes and fees levied or set of a violation of this ordinance and shall Control Board by the Eastern Shawnee Business be subjected to paying damages to the a. There is hereby established an Committee and keep accurate records, Eastern Shawnee Tribe of Oklahoma as Eastern Shawnee Liquor Control Board, books and accounts. set forth herein. (9) Adopt procedures which composed of a Chairperson, Vice- Section 6. Licensing and Application Chairperson, Secretary, Treasurer and supplement these regulations and three (3) additional members. facilitate their enforcement. Such a. Procedure. In order to control the b. The Eastern Shawnee Liquor procedures shall include limitations on proliferation of establishments on tribal Control Board shall consist of the sales to minors, places where liquor lands that sell or serve liquor by the officers and members of the Eastern may be consumed, identity of persons bottle or by the drink, all persons or Shawnee Business Committee. not permitted to purchase alcoholic entities that desire to sell liquor on c. Officers and members of the Eastern beverages, hours and days when outlets tribal lands must apply to the Eastern Shawnee Business Committee shall hold may be open for business, and other Shawnee Liquor Control Board for a the same positions on the Eastern appropriate matters and controls. license to sell or serve liquor. Shawnee Liquor Control Board as such b. Limitation on Powers. In the b. Application. Any enrolled member officers and members hold on the exercise of its powers and duties under of the Eastern Shawnee Tribe twenty- Business Committee. The Chief shall this Ordinance, the Liquor Control one (21) years of age and older, or an serve as the Liquor Control Board Board and its individual members shall enrolled member of a federally Chairperson; the Vice-Chief shall serve not: recognized tribe twenty-one (21) years as the Liquor Control Board Vice- (1) Accept any gratuity, compensation of age and older, or other person twenty- Chairperson; the Business Committee or other thing of value from any liquor one years of age and older, may apply Secretary shall serve as Secretary of the wholesaler, retailer or distributor or to the Liquor Control Board for a license Liquor Control Board; and the Business from any licensee. to sell or serve liquor. Any person or Committee Treasurer shall serve as (2) Waive the immunity of the Eastern entity applying for a license to sell or Treasurer of the Liquor Control Board. Shawnee Tribe of Oklahoma from suit serve liquor on tribal lands must fill in d. The Eastern Shawnee Liquor without the express written consent and the application provided for this Control Board shall meet on call, but not resolution of the Business Committee. purpose by the Eastern Shawnee Tribe less than once each calendar quarter, c. Inspection Rights. The premises on of Oklahoma and pay such application provided ten (10) days public notice of which liquor is sold or distributed shall fee as may be set from time to time by its meetings is given. The Chairman of be open for inspection by the Liquor the Liquor Control Board. Said the Eastern Shawnee Liquor Control Control Board and/or its staff at all application must be filled out Board shall call meetings of the Liquor reasonable times for the purposes of completely in order to be considered. A Control Board. ascertaining whether the rules and separate application and license will be e. A quorum of the Board shall consist regulations of the Business Committee required for each location where the of five (5) members and no fewer and this ordinance are being complied applicant intends to serve liquor. members are required to transact with. c. Licensing Requirements. The business. person applying for such license must Section 5. Sales of Liquor make a showing once a year, and must Section 4. Powers and Duties of the a. License Required. A person or satisfy the Liquor Control Board that he/ Eastern Shawnee Liquor Control Board entity who is licensed by the Eastern she is a person of good character, having a. Powers and Duties. In furtherance Shawnee Tribe of Oklahoma may make never been convicted of violating any of of this ordinance, the Liquor Control retail sales of liquor in their facility and the laws prohibiting the traffic in any Board shall have the following powers the patrons of the facility may consume spirituous, vinous, fermented or malt and duties: said liquor within the facility. The liquors; that he/she has never been (1) Publish and enforce rules and introduction and possession of liquor convicted of violating any of the regulations adopted by the Eastern consistent with this Section shall also gambling laws of this state, or any other Shawnee Business Committee governing be allowed. All other purchases and state of the United States, or of this or the sale, manufacture, distribution, and sales of liquor on tribal lands shall be any other Tribe; that he/she has not had, possession of alcoholic beverages on prohibited. Sales of liquor and alcoholic preceding the date of his/her tribal lands. beverages on tribal lands may only be application for a license, a felony (2) Employ managers, accountants, made at businesses that hold an Eastern conviction of any of the laws commonly security personnel, inspectors and such Shawnee Liquor License. called ‘‘prohibition laws’’; and that he/

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she has not had any permit or license to appeal is filed with the Tribal Court e. Any person who knowingly sells sell any intoxicating liquors revoked in within fifteen (15) calendar days of the liquor to a person who is obviously any county of this state, or any other date of mailing the decision to the intoxicated or appears to be intoxicated state, or of any Tribe; and that at the licensee. The Tribal Court will then shall be guilty of a violation of this time of his/her application for a license, conduct a hearing and will issue an Ordinance. he/she is not the holder of a retail liquor order, which is final with no further f. Any person engaged wholly or in dealer’s permit or license from the right of appeal. All proceedings part in the business of carrying United States Government to engage in conducted under all sections of this passengers for hire, and every agent, the sale of intoxicating liquor. Ordinance shall be in accord with due servant, or employee of such person, d. Processing of Application. The process of law. who shall knowingly permit any person Liquor Control Board shall receive and j. Non-transferability of Licenses. to drink liquor in any public process applications and related Licenses issued by the Liquor Control conveyance shall be guilty of an offense. matters. All actions by the Liquor Board shall not be transferable and may Any person who shall drink liquor in a Control Board shall be by majority vote. only be utilized by the person or entity public conveyance shall be guilty of a A quorum of the Liquor Control Board in whose name it is issued. violation of this Ordinance. is that number of members set forth in g. No person under the age of twenty- Section 3, paragraph (e) of this Section 7. Taxes one (21) years shall consume, acquire or Ordinance. The Liquor Control Board a. As a condition precedent to the have in his possession any liquor or may, by resolution, authorize a staff conduct of any operations pursuant to a alcoholic beverage. No person shall representative to issue licenses for the license issued by the Liquor Control permit any other person under the age sale of liquor and beer products. Board, the licensee must obtain from the of twenty-one (21) years to consume e. Issuance of License. The Liquor Eastern Shawnee Tribal Tax liquor on his premises or any premises Control Board may issue a license if it Commission such licenses, permits, tax under his control. Any person violating believes that such issuance is in the best stamps, tags, receipts, or other this prohibition shall be guilty of a interests of the Eastern Shawnee Tribe documents or things evidencing receipt separate violation of this Ordinance for of Oklahoma. The purpose of this of any license or payment of any tax or each and every drink so consumed. Ordinance is to permit liquor sales and fee administered by the Eastern h. Any person who shall sell or consumption at facilities located on Shawnee Tribal Tax Commission or provide any liquor to any person under designated tribal lands. Issuance of a otherwise showing compliance with the the age of twenty-one (21) years shall be license for any other purposes will not tax laws of the Tribe. guilty of a violation of this Ordinance be considered to be in the best interests b. In addition to any other remedies for each sale or drink provided. of the Eastern Shawnee Tribe of provided in this Ordinance, the Liquor i. Any person who transfers in any Oklahoma. Control Board may suspend or revoke manner an identification of age to a f. Period of License. Each license shall any licenses issued by it upon the person under the age of twenty-one (21) be issued for a period not to exceed one failure of the licensee to comply with years for the purpose of permitting such (1) year from the date of issuance. the obligations imposed upon the person to obtain liquor shall be guilty of g. Renewal of License. A licensee may licensee by the General Revenue and an offense; provided, that corroborative renew its license if the licensee has Taxation Act of the Eastern Shawnee testimony of a witness other than the complied in full with this Ordinance; Tribe of Oklahoma, or any rule, underage person shall be a requirement provided however, that the Liquor regulation, or order of the Eastern of finding a violation of this Ordinance. Control Board may refuse to renew a Shawnee Tribal Tax Commission. j. Any person who attempts to license if it finds that doing so would purchase an alcoholic beverage through Section 8. Rules, Regulations and not be in the best interests of health and the use of false or altered identification Enforcement safety of the Eastern Shawnee Tribe of that falsely purports to show the Oklahoma. a. In any proceeding under this individual to be over the age of twenty- h. Revocation of License. The Liquor ordinance, conviction of one unlawful one (21) years shall be guilty of violating Control Board may suspend or revoke a sale or distribution of liquor shall this Ordinance. license due to one or more violations of establish prima facie intent of k. Any person who is convicted or this Ordinance upon notice and hearing unlawfully keeping liquor for sale, pleads guilty to a violation of this at which the licensee is given an selling liquor or distributing liquor in ordinance shall be liable to pay the opportunity to respond to any charges violation of this ordinance. Eastern Shawnee Tribe of Oklahoma the against it and to demonstrate why the b. Any person who shall in any amount of up to $1,000 per violation as license should not be suspended or manner sell or offer for sale or civil damages to defray the Tribe’s cost revoked. distribution or transport liquor in of enforcement of this Ordinance. i. Hearings. Within fifteen (15) days violation of this Ordinance shall be l. When requested by the provider of after a licensee is mailed written notice subject to civil damages assessed by the liquor, any person shall be required to of a proposed suspension or revocation Liquor Control Board. present official documentation of the of the license, of the imposition of fines c. Any person within the boundaries bearer’s age, signature and photograph. or of other adverse action proposed by of tribal lands who buys liquor from any Official documentation includes one of the Liquor Control Board under this person other than a properly licensed the following: Ordinance, the licensee may deliver to facility shall be guilty of a violation of (1) Driver’s license or identification the Liquor Control Board a written this ordinance. card issued by any state department of request for a hearing on whether the d. Any person who keeps or possesses motor vehicles; proposed action should be taken. A liquor upon his person or in any place (2) United States Active Duty Military hearing on the issues shall be held or on premises conducted or maintained identification card; or before a person or persons appointed by by his principal or agent with the intent (3) Passport. the Liquor Control Board and a written to sell or distribute it contrary to the m. The consumption or possession of decision will be issued. Such decisions provisions of this Section, shall be liquor on premises where such will be considered final unless an guilty of a violation of this Ordinance. consumption or possession is contrary

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to the terms of this Ordinance will Ordinance or to render such provisions Washington, DC 20240; by all other result in a declaration that such liquor inapplicable to other persons or carriers, National Register of Historic is contraband. Any tribal agent, circumstances. Places, National Park Service,1201 Eye employee or officer who is authorized b. This Ordinance shall be effective St. NW., 8th floor, Washington DC by the Liquor Control Board to enforce on such date as the Secretary of the 20005; or by fax, 202–371–6447. Written this Ordinance shall seize all Interior certifies this Ordinance and or faxed comments should be submitted contraband and preserve it in publishes the same in the Federal by June 21, 2006. accordance with provisions established Register. for the preservation of impounded c. Any and all previous liquor control John W. Roberts, property. Upon being found in violation enactments of the Business Committee Acting Chief, National Register/National Historic Landmarks Program. of the ordinance, the party owning or in which are inconsistent with this control of the premises where Ordinance are hereby rescinded. ALASKA contraband is found shall forfeit all Kenai Peninsula Borough-Census Area right, title and interest in the items Section 11. Amendment and seized which shall become the property Construction Hoben Park, 401 Railway Ave., Seward, 06000515 of the Eastern Shawnee Tribe of a. This Ordinance may only be Oklahoma. amended by vote of the Eastern CALIFORNIA Shawnee Business Committee. Section 9. Abatement Plumas County b. Nothing in this ordinance shall be Warner Valley Major Developed Area a. Any room, house, building, vehicle, construed to diminish or impair in any structure, or other place where liquor is Historic District, (Lassen Volcanic National way the rights or sovereign powers of Park MPS) Head of Warner Valley, Chester, sold, manufactured, bartered, the Eastern Shawnee Tribe or its Tribal 06000526 exchanged, given away, furnished, or Government other than the due process otherwise disposed of in violation of the provision at Section 6(i), which Shasta County provisions of this Ordinance or of any provides that licensees whose licenses Lassen Volcanic National Park Highway other tribal law relating to the have been revoked or suspended may Historic District, (Lassen Volcanic National manufacture, importation, seek review of that decision in Tribal Park MPS) NPS Route 1, CA 89, Mineral, 06000527 transportation, possession, distribution Court. and sale of liquor, and all property kept Manzanita Lake Campground Comfort in and used in maintaining such place, Certification Station at Camp Store, (Lassen Volcanic National Park MPS) 39489 CA 44, is hereby declared a nuisance. The foregoing Liquor Control Shingletown, 06000528 b. The Chairman of the Liquor Control Ordinance of the Eastern Shawnee Tribe Manzanita Lake Campground Comfort Board, or if the Chairman fails or refuses of Oklahoma was duly amended, Station, Loop C, (Lassen Volcanic National to do so, the Liquor Control Board, by enacted and approved by the Business Park MPS) 39489 CA 44, Shingletown, a majority vote, shall institute and Committee of the Eastern Shawnee 06000529 maintain an action in the Tribal Court Tribe of Oklahoma this 18th day of Manzanita Lake Naturalist’s Services Historic in the name of the Eastern Shawnee January 2006, by a vote of: 4 FOR; 0 District, (Lassen Volcanic National Park MPS) 39489 CA 44, Shingletown, Tribe of Oklahoma to abate and AGAINST; 0 ABSTAINING; 1 ABSENT. perpetually enjoin any nuisance 06000525 declared under this Section. In addition Charles Enyart, DISTRICT OF COLUMBIA to the other remedies at tribal law, the Chief, Eastern Shawnee Tribe of Oklahoma. District of Columbia Tribal Court may also order the room, Attest: house, building, vehicle, structure, or Washington and Georgetown Railroad Car Glenna J. Wallace, place closed for a period of one (1) year House, (Streetcar and Bus Resources of Eastern Shawnee Tribe of Oklahoma. Washington, DC MPS) 770 M St. SE, or until the owner, lessee, tenant, or Washington, 06000516 occupant thereof shall give bond or [FR Doc. E6–8692 Filed 6–5–06; 8:45 am] sufficient sum from $1,000 to $15,000, BILLING CODE 4310–4J–P INDIANA depending upon the severity of past Blackford County offenses, the risk of offenses in the DEPARTMENT OF THE INTERIOR Hartford City Courthouse Square Historic future, and any other appropriate District, Roughly bounded by Franklin, criteria, payable to the Tribe and National Park Service Walnut, Water and Monroe Sts., Hartford conditioned that liquor will not be City, 06000522 thereafter manufactured, kept, sold, National Register of Historic Places; Dubois County bartered, exchanged, given away, Notification of Pending Nominations Huntingburg Commercial Historic District, furnished, or otherwise disposed of in and Related Actions violation of the provisions of this Roughly bounded by Geiger, 4th, Jackson and Market Sts., Huntingburg, 06000517 Ordinance or of any other applicable Nominations for the following tribal laws. If any conditions of the bond properties being considered for listing Fayette County are violated, the bond may be applied to or related actions in the National Fayette County Courthouse, 401 Central Ave., satisfy any amounts due to the Tribe Register were received by the National Connersville, 06000518 under this Ordinance. Park Service before May 13, 2006. Pursuant to § 60.13 of 36 CFR part 60 Morgan County Section 10. Severability and Effective written comments concerning the Morgantown Historic District, Approx. 4.5 Date significance of these properties under blks centered on Washington St., bet. a. If any provision under this the National Register criteria for Marion St. and E of Church St., Morgantown, 06000519 Ordinance is determined by court evaluation may be forwarded by United review to be invalid, such determination States Postal Service, to the National Putnam County shall not be held to render ineffectual Register of Historic Places, National Brown, Samuel, House, 1558 E. Cty Rd. 1100 the remaining portions of this Park Service, 1849 C St. NW., 2280, N, Roachdale, 06000520

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Wabash County Grand Forks County (b) prepare workers for good jobs with Lewis, Thomas J., House, 105 S. Arnold St., Grand Forks Near Southside Historic District career pathways in these rapidly Roann, 06000521 (Boundary Increase), 1216 Belmont Rd., expanding or transforming industries. Grand Forks, 06000533 The products, models, and effective MASSACHUSETTS VERMONT approaches that result from HGJTI Hampden County investments will be broadly Washington County Brimfield Center Historic District, Main St., disseminated to employers, education Kents Corner Historic District, Kent Hill Rd., Brookfled, Wales, Sturbridge and Warren and training providers, and the Old West Church Rd., Robinson Cemetery Rds., Brimfield, 06000524 workforce system to build their capacity Rd., Fowler Rd. Bliss Pond Rd., Calais, to respond to employers’ workforce Middlesex County 06000534 needs. Center School, 13 Bedford St., Burlington, [FR Doc. E6–8701 Filed 6–5–06; 8:45 am] Grant funds awarded under this 06000523 BILLING CODE 4312–51–P Solicitation for Grant Applications [FR Doc. E6–8690 Filed 6–5–06; 8:45 am] (SGA) should be used to develop and implement innovative and industry- BILLING CODE 4312–51–P DEPARTMENT OF LABOR driven training solutions that address the advanced manufacturing industry’s Employment and Training DEPARTMENT OF THE INTERIOR critical workforce challenges. Each Administration solution must take place in the context National Park Service of a strategic partnership between the Notice of Availability of Funds and workforce investment system, business National Register of Historic Places; Solicitation for Grant Applications for and industry representatives, and Notification of Pending Nominations High Growth Job Training Initiative education and training providers such and Related Actions Grants for the Advanced as community colleges. The projects Manufacturing Industry selected for funding under this SGA are Nominations for the following Announcement type: Notice of intended to complement and enhance properties being considered for listing Solicitation for Grant Applications. existing ETA investments for the or related actions in the National Funding Opportunity number: SGA/ advanced manufacturing industry Register were received by the National DFA PY 05–07. available on ETA’s Web site at http:// Park Service before May 20, 2006. www.doleta.gov/BRG/Indprof/ Pursuant to § 60.13 of 36 CFR part 60 Catalog of Federal Assistance number: Manufacturing.cfm. 17.261. written comments concerning the Applicants may be public, private for- significance of these properties under Key Dates: The closing date for receipt profit, and private non-profit the National Register criteria for of applications under this organizations. It is anticipated that evaluation may be forwarded by United announcement is July 25, 2006. individual awards will fall within the States Postal Service, to the National Applications must be received at the range of $750,000 to $1.5 million. Register of Historic Places, National address below no later than 5 p.m. ADDRESSES: (Eastern Time). Mailed applications must be Park Service, 1849 C St. NW., 2280, addressed to the U.S. Department of Washington, DC 20240; by all other SUMMARY: The Employment and Labor, Employment and Training carriers, National Register of Historic Training Administration (ETA), U.S. Administration, Division of Federal Places, National Park Service, 1201 Eye Department of Labor (DOL), announces Assistance, Attention: Eric Luetkenhaus, St. NW., 8th floor, Washington DC the availability of approximately $10 Grant Officer, Reference SGA/DFA PY– 20005; or by fax, 202–371–6447. Written million in grant funds for new and 05–07, 200 Constitution Avenue, NW., or faxed comments should be submitted innovative approaches to meeting the Room N4716, Washington, DC 20210. by June 21, 2006. workforce challenges of the advanced Applicants may apply online through manufacturing industry under the John W. Roberts, Grants.gov (http://www.grants.gov) and President’s High Growth Job Training further information about applying Acting Chief, National Register/National Initiative. ETA defines ‘‘advanced Historic Landmarks Program. online can be found in Part IV(3) of this manufacturing’’ as the use of technology solicitation. Telefacsimile (FAX) MISSOURI or other productivity-enhancing applications will not be accepted. business processes in the manufacturing St. Louis Independent city Applicants are advised that mail enterprise and/or value-added supply Autocar Sales and Service Building, (Auto- delivery in the Washington area may be chain. These advanced manufacturing delayed due to mail decontamination Related Resources of St. Louis, Missouri technologies and processes may be used MPS) 2745 Locust, St. Louis (Independent procedures. Hand delivered proposals in a variety of industry sectors. will be received at the above address. City), 06000530 The President’s High Growth Job SUPPLEMENTARY INFORMATION: This MONTANA Training Initiative (HGJTI) is a strategic effort to prepare workers for new and solicitation consists of eight parts: Lewis and Clark County increasing job opportunities in high- • Part I describes the funding opportunity, Alice Creek Historic District, USDA Forest growth, high-demand, and economically provides background information on ETA’s Service, Helena National Forest, Lincoln, vital industries and sectors of the demand-driven workforce investment 06000531 American economy. Through the strategies and the President’s High Growth initiative, ETA identifies high-growth, Job Training Initiative, and highlights the NORTH DAKOTA critical elements and special emphases for high-demand industries, evaluates their Bottineau County this solicitation. skill needs, and funds local and national • Part II describes the award amount and Main, North Dakota School of Forestry, Old, partnership-based demonstration performance period of the award. Alexander St. (N of terminus with 2nd St.), projects that: (a) Address workforce • Part III describes eligible applicants and Bottineau, 06000532 challenges identified by employers; and other grant specifications.

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• Part IV provides information on the the impact of workforce development and dislocated workers), provides application and submission process and activities, workforce investment boards funding to support training for qualified various funding restrictions. • partner with entities critical to the individuals, and connects trained Part V describes the criteria against development of America’s workforce: workers to good jobs. which applications will be reviewed and ETA is modeling the power of these explains the proposal review and selection Employers and education and training process. providers. partnerships at the national level • Part VI provides award administration Within the context of these strategic through investments in demonstration information. partnerships, communities should use a projects in 14 high-growth, high- • Part VII contains DOL agency contact solutions-based approach to workforce demand industries. Each of the 14 information. development, in which the partnering industries was selected because it meets • Part VIII lists additional resources of entities work through the cycle of: (1) one or more of the following criteria: (1) interest to applicants. Collecting and analyzing information Is projected to add substantial numbers I. Funding Opportunity Description about local workforce needs and critical of new jobs to the economy; (2) has a capacity constraints; (2) incorporating a significant impact on the economy Section 1 of this part provides business or demand-driven perspective overall; (3) impacts the growth of other background information on the into issue identification and solutions industries; (4) is being transformed by Employment and Training development; (3) ensuring that the right technology and innovation requiring Administration’s demand-driven strategic partners are at the table; (4) new skills sets for workers; or (5) is a workforce investment strategies. Section working collaboratively to explore, new and emerging business that is 2 describes ETA’s implementation of the frame, and implement solutions; and (5) projected to grow. The 14 industries are: President’s High Growth Job Training assessing how the products and • Advanced Manufacturing Initiative (HGJTI) and describes the outcomes of the project can be • Aerospace specific challenges and potential effectively deployed and replicated. The • Automotive Services solutions identified for the advanced • Biotechnology goal of this process is to ensure that • manufacturing industry as part of the workforce system dollars help workers Construction HGJTI process. Section 3 describes • Energy get skills training that aligns with local • critical elements of HGJTI grants. Financial Services industry-identified needs. • Geospatial Technology Section 4 describes areas of emphasis • particular to this SGA. 2. Background on the President’s High Healthcare Growth Job Training Initiative • Homeland Security 1. The Employment and Training • Hospitality ETA first modeled the role of strategic Administration’s Demand-Driven • Information Technology (IT) & IT partnerships in demand-driven Workforce Investment Strategies Business-Related Services workforce investment through the • Retail Each year, the federal government President’s High Growth Job Training • Transportation invests billions of dollars in a state and Initiative (HGJTI). This initiative is a For each industry, ETA follows a local workforce investment network to strategic effort to prepare workers for three-step process to identify workforce assist businesses in recruiting, training, new and increasing job opportunities in challenges and solutions and to and retaining a skilled workforce. This high-growth, high-demand, and demonstrate solutions nationally. First, network is called the workforce economically vital industries and ETA conducts an environmental scan to investment system, and consists of state sectors of the American economy. understand the economic conditions and local workforce investment boards, Through the initiative, ETA identifies and workforce challenges facing the state workforce agencies, and One-Stop high-growth, high-demand industries, industry. Second, ETA convenes a series Career Centers and their cooperating evaluates their skill needs, and funds of meetings to offer leaders in business partners. Although these federal local and national partnership-based and industry an opportunity to share investments have in the past supported demonstration projects that provide their current and future workforce needs a set of standard menu-driven services workforce solutions to ensure that with the workforce system. Using the for employers and workers, the realities individuals can gain the skills to get information gathered at these meetings, of today’s rapidly changing global good jobs with career pathways in these ETA convenes another round of economy make it imperative that the rapidly expanding or transforming meetings with industry and workforce workforce investment system support industries. investment system representatives to customized activities that are driven by The foundation of this initiative is verify workforce challenges and devise local employer demand. This demand- partnerships between the publicly solutions. The results of these meetings driven approach to workforce funded workforce investment system, are published in a comprehensive development is necessary to prepare business and industry representatives, industry report. These reports are made workers to take advantage of new and and the continuum of education. These available to the public via ETA’s Web increasing job opportunities in high- partnerships engage each partner in its site at http://www.doleta.gov/BRG/ growth, high-demand, and economically area of strength. Industry JobTrainInitiative, as the HGJTI process vital industries and sectors of the representatives and employers define is completed for each industry. American economy. workforce challenges facing the industry Based on the numerous industry- In a demand-driven workforce and identify the competencies and skills specific solutions identified during the investment system, state and local required for the industry’s workforce. HGJTI process, ETA identified a core set workforce investment boards should Education and training providers, such of workforce challenges that are invest strategically in workforce as community colleges, assist in common to all 14 target industries. development activities that are relevant developing competency models and These elements include: to the skill requirements of local curricula and train new and incumbent • Developing a pipeline of young industry and prepare individuals to workers. The workforce investment workers with foundational academic compete in a global economy through system analyzes local labor market skills in math, science, and language; better access to post-secondary information, accesses human capital • Expanding post-secondary training education and training. To maximize (youth, unemployed, underemployed, alternatives including apprenticeships

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and workforce development programs at to familiarize themselves with the full workforce development challenges, and community colleges; industry reports and current applicants are encouraged to address • Expanding the capacity of investments. one or more of these challenges and/or educational institutions; those included in the areas of emphasis The Advanced Manufacturing Industry • Helping workers keep up with the described in Section 4 of this part of the and Its Workforce Challenges rapid pace of changing skills SGA: requirements due to innovation and The U.S. manufacturing industry • Training for Innovation: technology; accounts for 14 percent of the U.S. Gross Manufacturers need workers who are • Developing new and innovative Domestic Product and employs 14 continually focused on innovating learning methodologies; million workers, 11 percent of total U.S. products and services, as well as • Developing strategies for growing employment. However, today’s production and business processes. and retaining a skilled workforce, manufacturing industry is undergoing a • Pipeline Development: Too few including developing career ladders and dramatic transformation, with profound young people consider the possibility of lattices for new and incumbent workers implications for the new and incumbent manufacturing careers and are unaware and updating the skills of incumbent manufacturing workforce. To increase of the necessary skills. Similarly, workers; productivity and remain globally students do not always graduate from • Accessing new and/or untapped competitive, U.S. manufacturers are high school equipped with the labor pools; incorporating process improvement necessary skills or educated about • Transitioning workers from strategies, adopting quality management manufacturing career opportunities. declining industries; systems, and overhauling their • Limited English-Speaking • Providing improved career production facilities with advanced Workforce: The manufacturing guidance information and tools to technology. In order to operate a workforce is increasingly foreign-born, students and jobseekers; modern production facility, meaning that English language skills are • Ensuring that educational models manufacturers require workers with becoming a prominent challenge for the reflect the structure of today’s advanced skills. industry. Employers have experienced workplace; Advanced manufacturing was difficulty finding English language • Building models to help address a included in the HGJTI because of its programs that suit their particular lack of industry defined competencies; importance to the U.S. economy, the needs. and transformation in technology and skill • Foundational Skills: Manufacturers • Engaging small businesses. requirements, and the difficulty that experience difficulty finding and hiring The third and final step of the HGJTI manufacturers report in hiring skilled workers with basic technical skills. process is a series of federal investments workers. ETA defines ‘‘advanced • Small Business Challenges: Many in unique, innovative, and industry- manufacturing’’ as the use of technology small- and medium-sized manufacturers driven projects that demonstrate or other productivity-enhancing report a variety of obstacles to training initiatives and capacity business processes in the manufacturing organizing training programs for their building strategies to address the enterprise and/or value-added supply workers, such as a lack of expertise, industry’s unique workforce challenges chain. This definition is not staff, or resources. and reflect one or more of the twelve synonymous with ‘‘high-tech • Matching Training Providers to elements outlined above. Together, manufacturing,’’ as the emphasis is on Business Needs: Manufacturers these projects contribute to a demand- the processes used in production and experience difficulty finding training driven workforce system by making up related activities, rather than the output providers that align with their particular a solution set tailored to each industry’s of high-tech products. These advanced needs, for example: Coordination of specific needs. The products, models, manufacturing technologies and work and training schedules, and effective approaches that result processes can be used in a variety of transportation of workers, and finding from this solution set are broadly industry sectors such as aerospace. In programs that meet specific technology disseminated to employers, education addition to actual production and or process needs. and training providers, and the assembly activities, this definition • Incumbent Worker Training: workforce system to build their capacity includes product design, process Manufacturers report a need for to respond to employers’ workforce engineering, quality control, and alternative methods by which current needs. software support, as well as product employees can improve their skills. ETA has completed the three-step packaging, shipping (though not the Competency models and career ladders HGJTI process for the advanced actual transportation), inventory need to be clearer in order to provide manufacturing industry. Over the past management, and maintenance of career development opportunities for two years, ETA has made investments in capital equipment. ETA believes that a incumbent workers. forty projects totaling over $80 million primary goal of the HGJTI in advanced • Training the Supply Chain: that support the advanced manufacturing, and of the broader Manufacturers increasingly need manufacturing industry. The projects public workforce system, should be to integrated training programs for workers selected for funding under this SGA are encourage and assist more throughout the supply chain. Initiating intended to complement and enhance manufacturers to adopt advanced improvements and making investments the existing solution sets for the manufacturing techniques, with in training and education may not advanced manufacturing industry. workforce training as a critical benefit a company if the suppliers to To assist applicants in understanding ingredient for that transformation. that company are not achieving similar this industry and to provide context for Over the course of a series of levels of improvement. the industry specific emphases detailed Executive Forums, ETA met with senior • Industry Capacity/Lack of Skilled in Section 4 of this part, a brief executives from more than 50 Workforce: New manufacturing description of the advanced manufacturing firms, representing a processes, such as nanotechnology, and manufacturing industry and its broad cross-section of the new product demand, such as the workforce challenges is provided below. manufacturing industry. The industry specialized equipment needed for the Additionally, applicants are encouraged executives identified numerous critical construction of nuclear power plants in

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the U.S., require domestic articulating how proposed workforce In order to maximize the long-term manufacturing capacity that may not solution(s) relate to the growing body of success of the proposed solution and to exist today. A significant component of knowledge from public, private, and keep pace with the rapid changes in the this challenge is the need for a skilled governmental sources about effective economy and the nature of the skills workforce. demand-driven workforce development and competencies necessary for work in In a series of Workforce Solutions practices in a variety of sectors. these industries, these partnerships Forums, attendees identified more than Applicants are not limited in the need to be substantial and sustained. 300 potential solutions to these strategies and approaches they may ETA encourages partners to plan for the challenges. Examples of the identified employ to implement solutions partnership’s sustainability beyond the solutions include, but are not limited to: provided the strategy is well developed, HGJTI investment period to enable • Creating an information and meets industry and local area workforce ongoing assessment of industry education sharing model to distribute challenges, delivers training to workers, workforce needs and collaborative knowledge, technology, and training and is not duplicative of any existing development of solutions on a continual assets across an industry supply chain. efforts. Examples of previously funded basis. • Providing convenient and flexible advanced manufacturing industry Within the context of the broader training through distance learning solutions include: strategic partnership, and as it relates to opportunities and self-paced training, • A program designed to increase the the HGJTI, each collaborative partner along with other delivery options. skills of workers in a large should have clearly defined roles. The • Creating and deploying industry- manufacturer’s supply chain so those exact nature of these roles may vary driven skills certifications that are workers could incorporate new required depending on the issue areas being sector specific, nationally recognized, composite materials technology to addressed and the scope and nature of and promote career ladders. remain competitive in the aerospace the activities undertaken. However, ETA 3. Critical Elements of High Growth Job industry. expects that each collaborative partner • A program led by a state workforce Training Initiative Grants will, at minimum, significantly investment board to provide technology contribute to one or more aspects of the HGJTI funded grants are expected to transfers from state universities on project. For example, employers must be contain at least six critical elements. modern plastics industry manufacturing actively engaged in the project and may These elements consist of: (A) technology, and to train workers to contribute to many aspects of grant Innovative solutions to industry allow them to take advantage of this activities including defining the identified workforce challenges; (B) new technology. program strategy and goals, identifying strategic partnerships; (C) leveraged B. Strategic Partnerships needed skills and competencies, and, resources; (D) sustainability; (E) where appropriate, hiring qualified replication of successful models for ETA believes that strategic training graduates. Education and broad distribution, and (F) clear and partnerships between the workforce training providers from the continuum specific outcomes. Each of these investment system, business and of education, which includes K–12, characteristics will be reflected in the industry entities, and education and community and technical colleges, four ratings criteria in Part V and is training providers such as community year colleges and universities, and other described in further detail below. colleges need to be in place in order to training entities, should assist in implement effective demand-driven developing industry-driven workforce A. Innovative Solution(s) to Industry training and capacity building Identified Workforce Challenges education strategies in partnership with strategies. Strategic partnerships employers including competency As previously mentioned in Part I(1), between these three entities are a models, curricula, and new learning the HGJTI employs a solutions-based required component of proposals methodologies. approach to addressing the needs of the submitted under this SGA, as detailed The workforce investment system 21st Century workforce. Grants funded in Part III(3)(a), and they may have a may play a number of roles, including under this SGA should demonstrate local, regional, or statewide focus. identifying and assessing candidates for how a demand-driven workforce system In addition, partnerships that include training, providing wrap-around can more efficiently serve the workforce a broader consortium of partners, such support services and training funds for needs of business while at the same as Manufacturing Extension Partnership qualified individuals, where time helping workers find good jobs (MEP) centers, Advanced Technology appropriate, and connecting qualified with good wages and promising career Education (ATE) centers, and others, are training graduates to employers that pathways. ETA also expects these grants also important to implementing have existing job openings. to demonstrate innovation in effectively effective demand-driven strategies. Partnerships with faith-based and meeting the workforce needs of the These strategic partnerships should community organizations are also advanced manufacturing industry. focus broadly on the workforce encouraged. Grantees may elect to sub- When considering the innovative challenges of the advanced award funds to faith-based and aspects of workforce solutions proposed manufacturing industry, which may community organizations to perform a by applicants, ETA may look to the include cross industry challenges, and variety of grant services such as case creativity of the content of the training should work collaboratively to identify management, mentoring, and English or product being delivered, the form and and implement a wide range of language programs, among others. Faith- style in which the training or product is solutions. Therefore, the HGJTI based and community organizations can delivered, the manner of managing and investment in training solutions would also provide wrap-around holistic and executing the development of the be one of many strategies that evolve comprehensive support services where training or product, including the types from the partnership. While ETA appropriate, such as employability of partners engaged or the roles partners welcomes applications from newly training and career awareness activities. play in the activities, and the adaptation formed strategic partnerships, of existing solutions to new contexts applicants are advised that grant funds C. Leveraged Resources and industries. Innovative solution may not be used for partnership HGJTI investments leverage funds and elements may be identified in part by development. resources from key entities in the

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strategic partnership. Leveraging Workforce3 One offers the public project into regional economic resources in the context of strategic workforce system, employers, economic development activities. partnerships accomplishes three goals: development professionals, and A. Addressing Advanced Manufacturing (1) It allows for the pursuit of resources education professionals an innovative Industry Identified Workforce driven by the strategy; (2) it increases knowledge network designed to create Challenges stakeholder investment in the project at and support a demand-driven all levels including design and community, one that responds directly Based on the scope and nature of implementation phases; and (3) it to business needs and prepares workers investments made in previous funding broadens the impact of the project itself. for good jobs in the fastest growing rounds, ETA has identified specific Leveraged resources include both careers. By supporting replicable workforce challenges for emphasis in federal and non-federal funds and may proposals that can be implemented in this SGA. These are a subset of the come from many sources. Businesses, multiple areas and industries, ETA is challenges described earlier in Section 2 faith-based and community able to maximize the investment by of this Part, and although applicants are organizations, economic development expanding the grant’s impact beyond encouraged to develop proposals that entities, education systems, and the initial grant site and helping address the specific challenges listed philanthropic foundations often invest additional workers in other areas and below, all unique and innovative resources to support workforce industries. proposals providing solutions to development. In addition, other federal, identified industry workforce challenges state, and local government programs F. Clear and Specific Outcomes in advanced manufacturing will be may have resources available that can be HGJTI grants are results-oriented and considered and reviewed. integrated into the proposed project. demonstrate clear and specific outcomes As applicants describe their solutions to the workforce challenges below or Examples of such programs include that are appropriate to the nature of the other industry challenges, they should other Department of Labor programs solution and the size of the project and describe how their project relates to the such as registered apprenticeship and that indicate progress towards the framework of competencies included in Job Corps, as well as non-DOL One-Stop workforce challenges identified by the Attachment A. This framework has been partner programs such as Vocational partnership. Because HGJTI grants developed by industry, and is designed Rehabilitation and Adult Education. invest in customized strategies to to provide prospective workers, ETA encourages HGJTI grantees and address local workforce challenges and educators, the public workforce system, their partners to be entrepreneurial as skill shortages, ETA recognizes that and businesses with a common they seek out, utilize, and sustain these outcomes will vary from project to resources when creating effective understanding of the basic project based on the specific activities competencies necessary for a career in solutions to the workforce challenges proposed. HGJTI grants should identified by the industry. advanced manufacturing. A more demonstrate the effectiveness of training detailed description of the framework, D. Sustainability activities by creating appropriate its purpose, and how to use it can be The HGJTI investment should be benchmarks and measuring against found in Attachment A. considered seed funding. Therefore, them on a regular basis. Please note that ETA is particularly HGJTI grantees should develop Training outcomes must include those interested in projects that provide strategies to sustain the project or tracked by the Common Measures such workers with the technical related partnership activities after the as earnings increases, job placements, competencies necessary to succeed in federal investment ends. Financial and job retention. Common Measures an advanced manufacturing resources are an important part of any are the OMB-approved uniform environment. Tiers 4 through 7 of the sustainability strategy; however, they evaluation metrics for job training and framework address these technical are not the only component. employment programs. A detailed competencies. Although applicants may Sustainability is also strengthened by description of ETA’s policy on the include efforts that promote personal the partnerships formed before and Common Measures can be found on the effectiveness, workplace, academic, and during the grant term; systems, Common Measures/Individual Program management competencies as an strategies, and processes put in place Performance Web page at http:// element of their projects, these efforts during the grant period; and the www.doleta.gov/Performance/ should not be the primary focus of the experience gained through quickview/IPPMeasures.cfm. project. implementing a HGJTI grant. All of Grants that have capacity building As applicants explain how the these may provide the foundation for components should track the impact of proposed models fit within the developing long-term systemic solutions products, models, and activities. framework, a description of how the to workforce challenges in high-growth, Outcomes and impacts of the proposed various tools and materials to be high-demand industries. project should satisfactorily address the developed under the proposal, such as industry-identified workforce needs and new curricula, certifications, or E. Replication of Successful Models for capacity constraints identified by the standards, should be included. Broad Distribution partnership. • Enterprise and Supply Chain HGJTI grantees are expected to Transformation: Applicants are 4. ETA Emphases for This SGA develop the learning and achievement encouraged to submit projects that that result from their projects into In addition to the critical elements promote the comprehensive solution models that can be shared with described above, ETA has developed transformation of a manufacturing and implemented by the workforce three areas of emphasis for advanced enterprise, or of a manufacturing value- investment system, industry leaders, manufacturing projects funded through added supply chain that involves a and education and training community. this SGA: (A) Addressing advanced number of separate companies To support the replication and manufacturing industry identified producing a final good. Because the distribution of solution models, ETA workforce challenges; (B) integrating manufacturing industry is being has developed an integrated web space Workforce Investment Act funding into transformed into a high tech industry called www.workforce3one.org. the project; and (C) integrating the using advanced manufacturing

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processes, industries and workforce • Increasing the Capacity for Training with states to identify available waivers systems need the ability to constantly to Industry-Wide Technical of statutory and regulatory requirements re-skill workers as innovation and Competencies: Applicants are as authorized under Section 189 of WIA. technology change the nature of the encouraged to submit projects that C. Integrating the Project Into State and work. An enterprise or supply chain address the need for qualified Regional Economic Development transformation model would instructors who can teach the full range demonstrate how the project partners of industry-wide technical Activities would provide a suite of workforce competencies described in Tier 4 of the ETA recognizes that workforce development offerings for multiple Advanced Manufacturing Competencies development is a key factor in our levels of an enterprise or supply chain, Framework, and included in nation’s economic competitiveness. To in order to promote agility of both Attachment A. Similarly, applicants are stay ahead of global competition, we production and business processes to encouraged to develop curricula and/or must identify strategies to further respond to changing market conditions. other training materials for the industry- integrate workforce and economic Although the overall project may wide technical competencies that may development with education at the state address the training needs of be disseminated nationwide. Applicants and regional level—where companies, administrative and supervisory should develop these materials for workers, researchers, entrepreneurs and personnel, the primary focus of the industry-wide technical competencies at governments come together to create grant funding should be directed toward both the entry level and the technician competitive advantage. Therefore, ETA workers associated with the level. encourages applicants to integrate their manufacturing process. proposed grant activities into state or • Career Lattice Models: Applicants B. Integrating Workforce Investment Act Funding regional economic development are encouraged to submit projects that strategies. This integration can be develop comprehensive career lattice Applicants are encouraged to achieved by (a) implementing strategies models for advanced manufacturing. integrate Workforce Investment Act that build upon and align with current The key elements of such models are: (WIA) funding at the state and local state and/or regional strategic plans Skills assessments, multiple entry-exit level into their proposed project. currently in place under the Workforce points, modularized curricula, multi- Integrating WIA funds ensures that the Investment Act, the Department of delivery options, and multi-level full spectrum of assets available from Commerce’s economic development certifications. The model should allow the workforce system is leveraged to programs, the Department of Housing for entry by various populations and support the HGJTI solution. The wide and Urban Development’s community under-utilized labor pools, including variety of WIA programs and activities development programs, and other but not limited to youth, older workers, provide both breadth and depth to the applicable state and federal programs; displaced workers, workers proposed solution offered to both and/or (b) strategically involving state transitioning between industries, businesses and individuals. In addition, and regional partners in grant activities. welfare recipients, ex-offenders, the use of WIA funds helps integrate the Applicants that fully demonstrate that veterans, workers with limited English grant’s solutions-based activities into their proposed grant activities are proficiency, incumbent workers, and/or the local or regional workforce integrated into state or regional persons with disabilities. investment system, which serves to • economic development strategies by Innovative Learning Methodologies: strengthen the system’s ability to providing clear and specific examples of become more demand-driven and Applicants are strongly encouraged to those strategies will receive 5 bonus supports long-term sustainability. develop and utilize learning points. methodologies in their projects that: The integration of WIA funds may Facilitate and accelerate knowledge take many forms. For example, HGJTI II. Award Information transfer through innovative, interactive, funds may be used for the development 1. Award Amount and integrated technologies; are flexible of curriculum materials and training for without constraints regarding time and incumbent workers, while WIA ETA intends to fund 10 to 12 projects place; and are responsive to the resources are used to fund Individual ranging from $750,000 to $1.5 million; different types of potential users of Training Accounts (ITAs) that provide however, this does not preclude funding these technologies. As information training for adults and dislocated grants at either a lower or higher technology rapidly becomes a defining workers. In addition, other WIA amount, or funding a smaller or larger element of today’s dynamic work resources may be used to provide number of projects, based on the type environment and an integral part of supportive services (such as and the number of quality submissions. motivating and supporting effective transportation or child care) to training Applicants are encouraged to submit learning, training models and recipients. Applicants may wish to budgets for quality projects at whatever methodologies that may have been consider the appropriateness of a variety funding level is appropriate to the adequate in the past may not be able to of WIA funds such as Job Corps (WIA project. Nevertheless, applicants should meet the demands of the workforce Title 1, Subtitle C), Youth (WIA Section recognize that the limited funds challenges of today. Meeting these 129), Adults and Dislocated Workers available through this SGA are intended challenges will require new and creative (WIA Section 133), Native Americans to supplement project budgets rather approaches to workforce development. (WIA Section 166), Migrant and than be the sole source of funds for the Examples of such methods may include Seasonal Farm Workers, (WIA Section proposal. the use of gaming or virtual simulations, 167), Demonstrations and Pilot Projects 2. Period of Performance just in time learning, distance learning (WIA Section 171), and National and blended learning solutions. Emergency Grants (WIA Section 173). The period of grant performance will Applicants are encouraged to Please note that all federal be up to 36 months from the date of demonstrate the impact of innovative requirements will continue to apply to execution of the grant documents. This learning methodologies on a variety of WIA integrated funds used for the performance period shall include all training outcomes such as wage gains proposed solution. However, selected necessary implementation and start-up and retention. applicants will be encouraged to work activities as well as participant follow-

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up for performance outcomes and grant provision of training to individual competency model framework found in close-out activities. A timeline clearly participants. Applicants are not limited Attachment A, this relationship should detailing these required grant activities in the strategies and approaches they be clearly articulated. and their expected completion dates may employ to implement training C. Participants Eligible To Receive activities; however, the training must: must be included in the grant HGJTI Training application. If applied for and with (a) Target skills and competencies significant justification, ETA may elect demanded by the advanced Generally, the scope of potential to exercise its option to award no-cost manufacturing industry; (b) support trainees is very broad. Training may be extensions to these grants for an participants’ long term career growth targeted to a wide variety of additional period at its own discretion, along a defined career pathway such as populations, including unemployed based on the success of the program and an articulated career ladder and lattice; individuals and incumbent workers. other relevant factors. and (c) result in an industry-recognized The identification of targeted and certificate, degree, or license that qualified trainees should be part of the III. Eligibility Information and Other indicates a level of mastery and larger project planning process by the Grant Specifications competence in a given field or function. required partnership and should relate 1. Eligible Applicants The credential awarded to participants to the workforce issue that is being addressed by the training. Applicants may be public, private for- should be based on the type of training provided through the grant and the profit, and private non-profit D. Veterans Priority requirements of the targeted occupation, organizations including faith-based and and should be selected based on This program is subject to the community organizations. The consultations with industry partners. provisions of the ‘‘Jobs for Veterans application must clearly identify the For example: Act,’’ Public Law 107–288, which applicant and describe its capacity to • Customized and short-term training provides priority of service to veterans administer the HGJTI advanced should result in a performance-based and spouses of certain veterans for the manufacturing grant, in terms of both certification or certificate. This receipt of employment, training, and organizational capacity and data certification may be developed jointly placement services in any job training management capabilities. Applications by employers and the project partners, program directly funded, in whole or in for supplementation of existing projects based on defined knowledge and skill part, by the Department of Labor. Please are eligible for consideration under this requirements for specific high-growth note that to obtain priority of service, a SGA; however, applications for renewal occupations. Performance-based veteran must meet the grantee’s program of existing projects will not be certifications may also be based on eligibility requirements. ETA Training considered. Please note that the industry recognized curriculum and and Employment Guidance Letter applicant and fiscal agent must be the standards. (TEGL) No. 5–03 (September 16, 2003), same organization. • Training in fields with established available at http://wdr.doleta.gov/ directives/corr_doc.cfm?DOCN=1512, 2. Cost Sharing or Matching professional standards and examinations should result in provides general guidance on the scope Cost sharing, matching, or cost certification. of the veterans priority statute and its participation is not required for • In states where licensure is required effect on current employment and eligibility; however, applicants are for the specific occupation targeted by training programs. encouraged to leverage the resources of the training, the credentialing the partnership, whenever possible. IV. Application, Submission, and requirement should be set accordingly. Funding Restriction Information 3. Other Grant Specifications • In some instances, training provided under the HGJTI grant may 1. Address To Request Application A. Demonstrated Partnerships lead to a degree. In these instances, the Package To be considered for funding under credential will be the degree itself or the This SGA contains all of the this SGA, the applicant must successful completion of coursework information and links to forms needed demonstrate that the proposed project required for the degree. to apply for grant funding. will be implemented by a strategic In addition to the required training partnership that includes at least one strategies, applicants may, but are not 2. Content and Form of Application entity from each of three categories: (1) required to, propose capacity building Submission The workforce investment system, strategies to meet the training needs of The proposal must consist of two (2) which may include state and local advanced manufacturing employers. separate and distinct parts: Part I, the workforce investment boards, state These proposed capacity building Cost Proposal and Part II, the Technical workforce agencies, and One-Stop efforts must be directly linked to the Proposal. Applications that fail to Career Centers and their partners; (2) the specific training supported under the adhere to the instructions in this section education and training community, grant, and are expected to address will be considered non-responsive and which includes the continuum of significant barriers that impede the may not be given further consideration. education from K–12 to community and ability of the partnership to meet the Please note that it is the applicant’s technical colleges, four year colleges advanced manufacturing industry’s responsibility to ensure that the funding and universities, and other training demand for workforce training. These amount requested is consistent across entities; and (3) employers and strategies should not simply address all parts and sub-parts of the industry-related organizations such as isolated deficits, but rather provide a application. associations and labor-management comprehensive solution to identified Part I of the proposal is the Cost organizations. capacity challenges as they relate to the Proposal and must include the advanced manufacturing industry. following two items: B. Training Workers for Employment in Please note that, where training and • The Standard Form (SF) 424, High-Growth Industries capacity building activities relate ‘‘Application for Federal Assistance’’ All grants funded under this specifically to competencies identified (available at http:// solicitation must include the direct in the advanced manufacturing www.whitehouse.gov/omb/grants/

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sf424.pdf). Upon confirmation of an double-spaced, single-sided, 8.5 inch x electronic copy of the proposal on CD– award, the individual signing the SF 11 inch pages with 12 point text font ROM. 424 on behalf of the applicant shall and one-inch margins. Any pages over 3. Submission Date, Times, and represent the responsible financial and the 25 page limit will not be reviewed. Addresses administrative entity. All applicants for In addition, the applicant may provide federal grant and funding opportunities resumes, a staffing pattern, statistical The closing date for receipt of are required to have a Dun and information and related material in applications under this announcement Bradstreet (DUNS) number. For more attachments, which may not exceed is July 25, 2006. Applications must be information about the DUNS number, twenty (20) pages. Although not received at the address below no later see OMB Notice of Final Policy required, letters of support or than 5 p.m. (Eastern Time). Issuance, 68 FR 38402 (June 27, 2003). commitment from partners providing Applications sent by e-mail, telegram, or Applicants must supply their DUNS financial resources may be submitted as facsimile (FAX) will not be accepted. number on the SF 424. The DUNS attachments. Such letters will count Applications that do not meet the number is a nine-digit identification against the allowable maximum page conditions set forth in this notice will number that uniquely identifies total. Please note that applicants should not be honored. No exceptions to the business entities. Obtaining a DUNS not send letters of commitment or mailing and delivery requirements set number is easy and there is no charge. support separately to ETA because forth in this notice will be granted. Mailed applications must be To obtain a DUNS number, access this letters are tracked through a separate addressed to the U.S. Department of Web site: http:// system and will not be attached to the Labor, Employment and Training www.dunandbradstreet.com or call 1– application for review. The applicant Administration, Division of Federal 866–705–5711. must clearly reference any partners in • Assistance, Attention: Eric Luetkenhaus, The Standard Form (SF) 424A the text of the Technical Proposal. Reference SGA/DFA, PY–05–07, 200 Budget Information Form (available at Except for the discussion of any http://www.whitehouse.gov/omb/grants/ Constitution Avenue, NW., Room leveraged resources to address the N4716, Washington, DC 20210. sf424a.pdf). In preparing the Budget evaluation criteria, no cost data or Information Form, the applicant must Applicants are advised that mail reference to prices should be included delivery in the Washington area may be provide a concise narrative explanation in the Technical Proposal. The to support the request. The budget delayed due to mail decontamination following information is required: procedures. Hand-delivered proposals narrative should break down the budget • A two-page abstract summarizing and corresponding leveraged resources will be received at the above address. the proposed project and applicant All overnight mail will be considered to by deliverable, making clear distinctions profile information including: between training and (if any) capacity • be hand-delivered and must be received Applicant name; at the designated place by the specified building costs, and should discuss • Industry focus (advanced precisely how the administrative costs closing date. manufacturing and any other related support the project goals. All applicants Applicants may apply online through industries, such as aerospace); should indicate training costs-per- Grants.gov (http://www.grants.gov). It is • A brief description of the workforce participant by dividing the total amount strongly recommended that applicants challenges addressed (100 words); of the budget designated for training by using Grants.gov immediately initiate • A brief description of the proposed the number of participants trained. This and complete the ‘‘Get Started’’ solution (150 words); registration steps at http:// is provided for informational purposes • only and will not be used in the Key partners funding amount www.grants.gov/GetStarted. These steps evaluation of the grant application. requested; may take multiple days to complete, and • Amount of leveraged resources; and this time should be factored into plans Please Note: If the proposal calls for • integrating WIA or other federal funds Number of people trained and other for electronic application submission in or includes other leveraged resources, key grant outcomes order to avoid facing unexpected delays • these funds should not be listed on the A table of contents listing the that could result in the rejection of an SF 424 or SF 424A Budget Information application sections; and application as untimely. If submitting • Form, but should be described in the A timeline outlining project electronically through grants.gov, it budget narrative and in Part II of the activities, including expected start-up, would be appreciated if the application proposal. The amount of federal funding implementation, participant follow-up submitted is saved as .doc, .pdf, or .txt requested for the entire period of for performance outcomes, grant close- files. performance should be shown together out and other activities. Late Applications: Any application on the SF 424 and SF 424A Budget Please note that the abstract, table of received after the exact date and time Information Form. Applicants are also contents, and timeline are not included specified for receipt at the office encouraged, but not required, to submit in the twenty-five page limit. designated in this notice will not be the OMB Survey N. 1890–0014: Survey Applications may be submitted considered, unless it is received before on Ensuring Equal Opportunity for electronically on Grants.gov or in awards are made, it was properly Applicants, which can be found at hardcopy via mail or hand delivery. addressed, and it was (a) sent by U.S. http://www.doleta.gov/sga/forms.cfm. These processes are described in further Postal Service mail, postmarked not Part II of the application is the detail in Section IV(3). Applicants later than the fifth calendar day before Technical Proposal, which demonstrates submitting proposals in hard-copy must the date specified for receipt of the applicant’s capabilities to plan and submit an original signed application applications (e.g., an application implement the President’s High Growth (including the SF 424) and one (1) required to be received by the 20th of Job Training Initiative grant project in ‘‘copy-ready’’ version free of bindings, the month must be post marked by the accordance with the provisions of this staples or protruding tabs to ease in the 15th of that month), or (b) sent by solicitation, and includes a project reproduction of the proposal by DOL. overnight delivery service or Grants.gov description as described in the Criteria Applicants submitting proposals in to the addressee not later than one section of this solicitation. The project hard-copy are also requested, though working day prior to the date specified description is limited to twenty-five (25) not required, to provide an identical for receipt of applications. It is highly

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recommended that online submissions administrative costs associated with the V. Application Review Information be completed one working day prior to managing of the partnership as it relates 1. Evaluation Criteria the date specified for receipt of to specific grant activity, the primary applications to ensure that the applicant use of funding should be to support the This section identifies and describes still has the option to submit by actual capacity building and training the criteria that will be used to evaluate overnight delivery service in the event activity(ies). To claim any the President’s High Growth Job of any electronic submission problems. administrative costs that are also Training Initiative grant proposals. ‘‘Post marked’’ means a printed, indirect costs, the applicant must obtain These criteria and point values are: stamped or otherwise placed impression an indirect cost rate agreement from its (exclusive of a postage meter machine federal cognizant agency as specified in Criterion Points impression) that is readily identifiable, Section 5(A) of this part. A. Statement of Need ...... 10 without further action, as having been C. ETA Distribution Rights B. Innovative Solutions to Ad- supplied or affixed on the date of dress Industry Identified Work- mailing by an employee of the U.S. Applicants should note that grantees force Challenges ...... 30 Postal Service. Therefore, applicants must agree to provide USDOL/ETA a C. Outcomes and Impact ...... 25 should request the postal clerk to place paid-up, non-exclusive and irrevocable D. Linkages to Key Partners ...... 15 a legible hand cancellation ‘‘’bull’s eye’’’ license to reproduce, publish, or E. Leveraged Resources ...... 10 otherwise use for federal purposes all F. Program Management and Or- postmark on both the receipt and the ganization Capacity ...... 10 package. Failure to adhere to the above products developed or for which ownership was purchased under an *Bonus: Connections to Regional instructions will be a basis for a Economies ...... 5 determination of nonresponsiveness. award, including but not limited to curricula, training models, technical Total Possible Points ...... 105 4. Intergovernmental Review assistance products, and any related This funding opportunity is not materials, and to authorize them to do A. Statement of Need (10 Points) subject to Executive Order 12372, so. Such uses include, but are not Applicants must demonstrate a clear ‘‘Intergovernmental Review of Federal limited to, the right to modify and and specific need for the federal Programs.’’ distribute such products worldwide by any means, electronically or otherwise. investment in the proposed activities 5. Funding Restrictions by: (a) Describing the role of the D. Legal Rules Pertaining to Inherently Determinations of allowable costs will advanced manufacturing industry or Religious Activities by Organizations be made in accordance with the industry sub-sectors in the economy of That Receive Federal Financial applicable federal cost principles, e.g., the area in which the grant activity will Assistance Non-Profit Organizations—OMB take place; (b) describing the workforce Circular A–122. Disallowed costs are The government is generally challenges facing the industry and their those charges to a grant that the grantor prohibited from providing direct impact on specific local economic and agency or its representative determines financial assistance for inherently workforce conditions; and (c) describing not to be allowed in accordance with religious activities. See 29 CFR Part 2, the resource analysis and mapping that the applicable federal cost principles or Subpart D. These grants may not be has been conducted to date that other conditions contained in the grant. used for religious instruction, worship, demonstrates that local resources are prayer, proselytizing or other inherently not sufficient to address the workforce A. Indirect Costs religious activities. Neutral, non- challenges. If the applicant intends to As specified in OMB Circular A–122, religious criteria that neither favor nor include capacity building activities as indirect costs are those that have been disfavor religion will be employed in part of the proposal, this section must incurred for common or joint objectives the selection of grant recipients and also include a detailed discussion of the and cannot be readily identified with a must be employed by grantees in the capacity challenges the community or particular final cost objective. In order selection of sub-recipients. The term region faces that limit its ability to to utilize grant funds for indirect costs ‘‘direct’’ support is used to describe provide sufficient quantity or quality of incurred the applicant must obtain an funds or other support that are provided training to meet the identified workforce Indirect Cost Rate Agreement with its ‘‘directly’’ by a governmental entity or needs. In addition, applicants should Federal Cognizant Agency either before an intermediate organization with the provide evidence that the workforce or shortly after grant award. same duties as a governmental entity, as challenges to be addressed by the grant opposed to funds that an organization were identified in the context of the B. Administrative Costs receives ‘‘indirectly’’ as the result of the strategic partnership. Under the President’s High Growth genuine and independent private choice Applicants may draw from a variety Job Training Initiative, an entity that of a beneficiary under the meaning of of resources for supporting data, receives a grant to carry out a project or the Establishment Clause of the U.S. including: traditional labor market program may not use more than 10 Constitution. information, such as projections; percent of the amount of the grant to industry data; trade associations or pay administrative costs associated with 6. Other Submission Requirements direct information from the local the program or project. Administrative Withdrawal of Applications. industry; and information on the local costs could be both direct or indirect Applications may be withdrawn by economy and other transactional data, costs, and are defined at 20 CFR written notice or telegram (including such as job vacancies, that are available 667.220. Administrative costs do not mailgram) received at any time before locally. need to be identified separately from an award is made. Applications may be Up to 10 points may be awarded program costs on the SF 424A Budget withdrawn in person by the applicant or under this criterion based on the Information Form. They should be by an authorized representative thereof, demonstrated existence of workforce discussed in the budget narrative and if the representative’s identity is made challenges and the extent of need for the tracked through the grantee’s accounting known and the representative signs a federal investment in the solution. system. Although there will be receipt for the proposal. Important factors for evaluation include:

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• Demonstrated knowledge of the and clearly fit within the framework for workforce development. To receive full advanced manufacturing industry in the advanced manufacturing competencies points for this element, applicants must local area, including the impact of the described in Attachment A. When clearly identify innovative aspects of the industry on the local or regional discussing skills and competencies proposed solution and explain in what economy. under the framework for advanced way they are innovative and how that • Demonstrated existence of the manufacturing competencies in innovation will improve the overall identified workforce challenges and, if Attachment A, applicants should quality and effectiveness of the solution. capacity building activities are specifically describe the tiers or Applicants may also identify innovative proposed, demonstrated existence of a competencies they intend to address. solution elements by articulating how capacity constraint in addressing those The proposed training activities should proposed workforce solution(s) relate to challenges, in the area in which the also lead to an appropriate credential. If the growing body of knowledge from grant activity will take place. the credential targeted by the training public, private, and governmental • Discussion of the how the industry project is a certificate or performance- sources about effective demand-driven workforce challenges affect the specific based certification, applicants should workforce development practices. employer partners contained in the either (a) demonstrate employer • Integrating the Project into State proposal. engagement in the curriculum and Regional Economic Development • Description of economic analysis development process, or (b) indicate Activities (5 bonus points). Applicants and resource mapping used to that the certification will translate into that fully demonstrate that their demonstrate need for the federal concrete job opportunities with an proposed grant activities will be investment. employer. If there are proposed capacity integrated into state or regional • Identification of the sources of data building activities, the applicant must economic development strategies will used in analyses. demonstrate that these activities are receive 5 bonus points. Applications • If appropriate, the nature of larger broad based, and are clearly integrated that do not fully demonstrate this strategic economic development or with training activities. Proposals integration will not receive bonus workforce investment projects with calling for developing curricula or points. Full demonstration of this which the proposed project is aligned. certification or assessing skills should integration can be achieved by (a) B. Innovative Solutions To Address describe how those activities relate to describing how proposed activities will Industry Identified Workforce the competency framework and indicate build upon and align with current state and/or regional strategic plans currently Challenges (30 Points) whether they will be building new tools and materials to address the in place under the Workforce The applicant must describe the competencies or will utilize existing Investment Act, the Department of proposed workforce development ones. (8 points). Commerce’s economic development solution strategy in full, including all • The applicant describes a programs, the Department of Housing solution elements and implementation reasonable sustainability strategy and Urban Development’s community strategies, how the solutions address the beyond the federal investment (3 development programs, and other workforce challenges described in the points). applicable state and federal programs; statement of need, and how the • Implementation Strategy (10 and/or (b) explaining how key state and proposed solution complements or points). Applicants can earn up to 10 regional economic development enhances existing ETA investments in points based on evidence that the partners will be involved in grant advanced manufacturing, and other applicant has a clear understanding of activities by providing clear and specific activities undertaken by the partnership. the tasks required to successfully meet examples of those strategies. Points for this criterion will be awarded the objectives of the grant. Factors for the following factors: considered in evaluating this evidence C. Outcomes and Impact (25 Points) • Solution Description (15 points). include: (1) The existence of a work Applicants should demonstrate a Applicants may earn up to 15 points plan that is responsive to the applicant’s results-oriented approach to managing based on evidence that the applicant has statement of need and includes specific and operating the HGJTI project by fully developed an effective solutions-based goals, objectives, activities, describing the proposed outcome approach and a plan of implementation implementation strategies, and a measures relevant to measuring the that will address the following timeline; (2) the feasibility and success or impact of the project. Scoring objectives: reasonableness of the timeline for on this criterion will be based on the • The proposed project will address accomplishing all necessary following factors: one or more workforce challenges implementation activities, including • Description of Outcomes (10 identified by the advanced start-up, capacity building (if points). Applicants may earn up to 10 manufacturing industry through the applicable) and training activities, points for indicating that appropriate High Growth Job Training Initiative, as participant follow-up for performance outcomes will be tracked as detailed discussed in Sections I(2) and I(4)(A) of outcomes, and grant close-out activities; below. Additionally, the description of this SGA; the proposed industry-driven (3) whether budget line items are outcomes must include: (1) Baseline project activities were developed in the consistent with and tied to the work numbers for tracking progress; (2) context of a solutions-based approach; plan objectives; and (4) the extent to benchmark outcome goals; and (3) the and the project will contribute to a which the budget is justified with methods proposed to collect and demand-driven workforce investment respect to the adequacy and validate outcome data in a timely and system (4 points). reasonableness of resources requested. accurate manner. • The proposed training activities • Innovative Solution Design (5 • Training. Applicants must track target skills and competencies points). Applicants may earn up to 5 training outcome measures that are demanded by the advanced points for integrating into their consistent with ETA’s Common manufacturing industry, support solutions approaches and techniques Measures, such as employment participants’ long term career growth that are distinctively innovative, placement numbers and/or earnings along a defined career pathway such as creative, or adaptive, or by gains and retention. Other outcome an articulated career ladder and lattice, demonstrating a new approach to measures that should be tracked include

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the number of individuals awarded role each partner will play in the • Evidence, such as letters of credentials or degrees, and any other project. Points for this factor will be commitment, that key partners have outcome measures specific to the awarded based on: (a) The expressed a clear commitment to proposed training project. Applications comprehensiveness of the partnership provide the contribution. must also identify the type of credential and the degree to which each key • The nature of the leveraged that participants will earn as a result of partner plays a committed role, either resources including an itemized the proposed training, and the financial or non-financial, in the description of each cash or in-kind employer-, industry-, vendor-, or state- proposed project; (b) the breadth and contribution and a description of how defined standards associated with the depth of each key partner’s each contribution will support the credential. contribution, their knowledge and proposed grant activities. • Capacity Building. Applicants that experience concerning the proposed • The quality of the leveraged have capacity building components in grant activities, and their ability to resources including the quality of each their projects must clearly describe all impact the success of the project; and (c) in-kind contribution and the extent to products, models, curricula, etc. that evidence, which may include letters of which each contribution will be used to will be developed or acquired with commitment and support, that key further the goals of the project. federal funds through the grant and partners have expressed a clear F. Program Management and indicate the number of participants or dedication to the project and Organization Capacity (10 Points) entities who will benefit in either the understand their areas of responsibility. short and/or long term, from the Please note that, in order to receive full To satisfy this criterion, applicants proposed activities. Applicants must points for this factor, applicants must must describe their proposed project describe the data measures that will be demonstrate that each required partner management structure including, where used to measure how the proposed will play a well-developed and appropriate, the identification of a capacity building activities impact the committed role in the project. proposed project manager, discussion of ability of entities to train workers for • Partnership Management (6 points). the proposed staffing pattern, and the skills in demand by the advanced Points for this factor will be awarded qualifications and experience of key manufacturing industry. based on evidence of a plan for staff members. Applicants should also • Appropriateness of Outcomes (10 interaction between partners at each show evidence of the use of data points). Applicants may earn up to 10 stage of the project, from planning to systems to track outcomes in a timely points based on three factors: (1) The execution, demonstrated ability of the and accurate manner. The applicant extent to which the expected project lead agency to successfully manage should include a description of outcomes are clearly identified and partnerships, and the overall organizational capacity and the measurable, realistic, and consistent completeness of the partnership, organization’s track record in projects with the objectives of the project; (2) the including its ability to manage all similar to that described in the proposal ability of the applicant to achieve the aspects and stages of the project and to and/or related activities of the primary stated outcomes within the timeframe of coordinate individual activities with the partners. the grant; (3) the appropriateness of the partnership as a whole. Scoring under this criterion will be outcomes with respect to both the extent E. Leveraged Resources (10 Points) based on the extent to which applicants of the workforce challenge described in provide evidence of the following: the statement of need and the requested Applicants should clearly describe • The time commitment of the level of funding. any funds and resources leveraged in proposed staff is sufficient to ensure • Replication of Outcomes (5 points). support of grant activities and proper direction, management, and Applicants may earn up to 5 points by demonstrate how these funds will be timely completion of the project; demonstrating the existence of an used to contribute to the goals of the • The roles and contribution of staff, effective plan to capture proposed project. This applies to funds leveraged consultants, and collaborative activities into a model that can be from businesses, faith-based and organizations are clearly defined and shared with the workforce investment community organizations, economic linked to specific objects and tasks; system and other partners. development entities, education • The background, experience, and systems, philanthropic foundations, other qualifications of the staff are D. Linkages to Key Partners (15 Points) and/or Federal, State, and local sufficient to carry out their designated The application must demonstrate government programs, including WIA, roles; and that the proposed project will be Trade Adjustment Assistance, and • The applicant organization has implemented by a partnership that Wagner-Peyser. significant capacity to accomplish the includes at least one entity from each of Scoring on this factor will be based on goals and outcomes of the project, three categories: (1) The workforce the extent to which the applicant fully including the ability to collect and investment system, (2) education and describes the amount, commitment, manage data in a way that allows training providers such as community nature, and quality of leveraged consistent, accurate, and expedient colleges, and (3) employers and industry resources. The amount of resources reporting. representatives. ETA encourages, and leveraged will not be factored into the will be looking for, applications that go score for this section. Rather, 2. Review and Selection Process beyond the minimum level of applications will be scored based on the Applications for the President’s High partnership and demonstrate broader, degree to which the source and use of Growth Job Training Initiative Grants substantive and sustainable funds is clearly explained and the under this solicitation will be accepted partnerships, such as those with faith- extent to which leveraged resources are after the publication of this based and community organizations. integrated into the project in support of announcement until the closing date. A Points for this criterion will be awarded grant outcomes. Important elements of technical review panel will make based on the following three factors: the explanation include: careful evaluation of applications • Completeness of the Partnership (9 • Which partners have contributed against the criteria. These criteria are points). The applicant must identify the leveraged resources and the extent of based on the policy goals, priorities, and partners and explain the meaningful each contribution. emphases set forth in this SGA. Up to

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105 points may be awarded to an will be subject to the following 3. Reporting application, including the five point administrative standards and The grantee is required to provide the bonus for connections to regional provisions, if applicable: reports and documents listed below: a. All Grant Recipients—20 Code of economies, based on the required Quarterly Financial Reports. A Federal Regulations (CFR) Part 667.220. information described in Part V(1). The Quarterly Financial Status Report (SF ranked scores will serve as the primary (Administrative Costs). b. Non-Profit Organizations—Office of 269) is required until such time as all basis for selection of applications for funds have been expended or the grant funding, in conjunction with other Management and Budget (OMB) Circulars A–122 (Cost Principles) and period has expired. Quarterly reports factors such as alignment with are due 30 days after the end of each emphases detailed in the SGA; urban, 29 CFR Part 95 (Administrative Requirements). calendar year quarter. Grantees must use rural, and geographic balance; the ETA’s Online Electronic Reporting availability of funds; and which c. Educational Institutions—OMB Circulars A–21 (Cost Principles) and 29 System. proposals are most advantageous to the Quarterly Progress Reports. The Government. The panel results are CFR Part 95 (Administrative Requirements). grantee must submit a quarterly progress advisory in nature and not binding on report to the designated Federal Project the Grant Officer, and the Grant Officer d. State and Local Governments— OMB Circulars A–87 (Cost Principles) Officer within 30 days after the end of may consider any information that each quarter. Two copies are to be comes to his/her attention. The and 29 CFR Part 97 (Administrative Requirements). submitted providing a detailed account Government may elect to award the of activities undertaken during that grant(s) with or without discussions e. Profit Making Commercial Firms— Federal Acquisition Regulation (FAR)— quarter. DOL may require additional with the applicants. Should a grant be data elements to be collected and awarded without discussions, the award 48 CFR Part 31 (Cost Principles), and 29 CFR Part 95 (Administrative reported on either a regular basis or will be based on the applicant’s special request basis. Grantees must signature on the SF 424, which Requirements). f. All entities must comply with 29 agree to meet all DOL reporting constitutes a binding offer by the CFR Parts 37, 93 and 98, and, where requirements. applicant (including electronic applicable, 29 CFR Parts 96 and 99. Final Report. A draft final report must signature via E-Authentication on g. In accordance with Section 18 of be submitted no later than 60 days prior http://www.grants.gov). the Lobbying Disclosure Act of 1995, to the expiration date of the grant. This VI. Award Administration Information Public Law 104–65 (2 U.S.C. 1611) non- report must summarize project profit entities incorporated under activities, employment outcomes, and 1. Award Notices Internal Revenue Service Code Section related results of the training project, All applicants will be contacted 501(c)(4) that engage in lobbying and should thoroughly document the regarding their selection status at the activities are not eligible to receive solution approach. After responding to conclusion of the review and selection federal funds and grants. DOL questions and comments on the process and all award notifications will draft report, three copies of the final be posted on the ETA Homepage at Note: Except as specifically provided in this SGA, DOL/ETA’s acceptance of a report must be submitted no later than http://www.doleta.gov. Applicants proposal and an award of federal funds to the grant expiration date. Grantees must selected for award will be contacted sponsor any programs(s) does not provide a agree to use a designated format directly before the grant’s execution and waiver of any grant requirements and/or specified by DOL for preparing the final non-selected applicants will be notified procedures. For example, the OMB Circulars report. by mail. require that an entity’s procurement procedures must ensure that all procurement VII. Agency Contacts Note: Selection of an organization as a transactions are conducted, as much as For further information regarding this grantee does not constitute approval of the practical, to provide open and free grant application as submitted. Before the competition. If a proposal identifies a SGA, please contact Melissa Abdullah, actual grant is awarded, DOL/ETA may enter specific entity to provide services, the DOL/ Grants Management Specialist, Division into negotiations about such items as ETA’s award does not provide the of Federal Assistance, at (202) 693–3346 program components, staffing and funding justification or basis to sole source the (This is not a toll-free number). levels, and administrative systems in place to procurement, i.e., avoid competition, unless Applicants should fax all technical support grant implementation. If the the activity is regarded as the primary work questions to (202) 693–2705 and must negotiations do not result in a mutually of an official partner to the application. acceptable submission, the Grant Officer specifically address the fax to the attention of Melissa Abdullah and reserves the right to terminate the negotiation B. Special Program Requirements and decline to fund the application. should include SGA/DFA PY 05–07, a Evaluation. DOL may require that the contact name, fax and phone number. 2. Administrative and National Policy program or project participate in an This announcement is being made Requirements evaluation of overall HGJTI grant available on the ETA Web site at http:// performance. To measure the impact of www.doleta.gov/sga/sga.cfm and at A. Administrative Program grants funded under the HGJTI, ETA http://www.grants.gov. Requirements may arrange for or conduct an All grantees, including faith-based independent evaluation of the outcomes VIII. Other Information organizations, will be subject to all and benefits of the projects. Grantees Resources for the Applicant. The applicable Federal laws (available at must agree to make records on Department of Labor maintains a http://thomas.loc.gov) and regulations participants, employers, and funding number of Web-based resources that (available at http://www.gpoaccess.gov/ available and to provide access to may be of assistance to applicants. The cfr), as well as the applicable Office of program operating personnel and to Web page for the Employment and Management and Budget (OMB) participants, as specified by the Training Administration’s Business Circulars (available at http:// evaluator(s) under the direction of ETA, Relations Group (http://www.doleta.gov/ www.whitehouse.gov/omb/circulars). including after the expiration date of the BRG) is a valuable source of background The grant(s) awarded under this SGA grant. on the President’s High Growth Job

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Training Initiative. America’s Service accommodate changing technology and • Describe how they will utilize Locator (http://www.servicelocator.org) business practices. More specifically, existing standards, curricula, provides a directory of our nation’s One- this framework provides a common certifications, and assessment tools; and Stop Career Centers. Applicants are language and reference to facilitate • Describe whether they will build on encouraged to review ‘‘Understanding communication as industry leaders, existing tools or develop new ones. the Department of Labor Solicitation for educators, economic developers and As noted in the SGA, ETA is Grant Applications and How to Write an public workforce investment particularly interested in projects that Effective Proposal’’ (http://www/ professionals undertake a variety of provide workers with the technical dol.gov/cfbci/sgabrochure.htm). For a activities, including: competencies necessary to succeed in basic understanding of the grants • Developing sector specific an advanced manufacturing process and basic responsibilities of competencies that flow from the environment, which encompass Tiers 4 receiving federal grant support, please foundational competencies; through 7 of the framework. While see ‘‘Guidance for Faith-Based and • Developing competency-based applicants may include efforts that Community Organizations on Partnering curricula and training models; promote personal effectiveness, • with the Federal Government (http:// Developing position descriptions workplace, academic, and management www.fbci.gov). and hiring criteria for industry; competencies as an element of their • Developing assessment and testing Signed at Washington, DC, this 22nd day projects, these efforts should not be the instruments; and primary focus of the project. of May 2006. • Providing guidance for government Eric D. Luetkenhaus, investments in workforce preparation Dissemination and Use of Industry Grant Officer, Employment and Training strategies in the manufacturing industry. Competency Models Administration. This framework builds on existing Over the coming months, ETA intends Attachment A: Framework of national and state skills standards, to develop similar competency model Competencies for the Advanced technical curricula, and certifications in frameworks for each of the industries Manufacturing Industry the field of advanced manufacturing. that make up the President’s High This product is intended to be the Growth Job Training Initiative. In Competency Models as a Business framework for a competency model and Solution addition, ETA is developing a Web- purposely does not include performance based clearinghouse for industry-driven Over the course of the High Growth indicators or measurement criteria for competency models that will: Job Training Initiative for advanced each competency content area, which • Provide industry a means to manufacturing, ETA learned about must be developed by industry. publicize their emerging skill needs; numerous efforts to document the skills Similarly, the framework does not • Serve as a resource where and competencies needed for successful specify competencies for individual businesses (both small and large), careers in the industry. Over the years, industry sectors or occupations, which educators, and individuals can go to many organizations have created also must be developed by industry ascertain the emerging skill demands in curricula, educational programs, and with their educational partners. Rather, the U.S. workplace, and related other training tools to help prepare the framework does describe specific certifications; America’s future manufacturing competencies regarding foundational • Offer a tool for businesses and workforce. Today’s manufacturers personal effectiveness, academic, human resource professionals to recognize the need for a common workplace, and industry-wide technical develop job requirements; framework of foundational skills and competencies, included as part of this • Provide a strong framework for competencies in order to know they are attachment. It is intended that by curriculum development in advanced hiring workers who are prepared to reducing duplication of efforts, such as manufacturing; and succeed in 21st Century advanced continually identifying and re- • Serve as a resource for career manufacturing. Moreover, prospective validating core foundational exploration and guidance. workers want to know what skills they competencies, this framework will free The Internet-based competency need to take the first step toward a up resources, time, and energy for clearinghouse will display the successful career in manufacturing; innovative curriculum development that competency framework and provide training providers need to know what can keep up with the pace of changing links to access a database of related standards their training should meet, technology and industry requirements. resources: skill standards, competency- and that those standards are directly For purposes of this SGA, applicants based curricula, certifications, career relevant to industry requirements; and are encouraged to familiarize ladder models and other tools. The the public workforce system needs to themselves with this framework. clearinghouse will be added to over know that the training programs they Proposals that call for developing time as new resources are developed are supporting and referring customers curricula or certifications, providing and to reflect changing skill to are producing workers that will find training assessing skills, or related requirements. employment. activities, should describe how those activities relate to this framework. It is Structure of the Competency Framework The Value of Industry Competency not suggested or encouraged that For easy reference, the building Models proposals address all of the tiers and blocks for competency models, or In response, industry has developed a competencies identified in the competency model content framework, dynamic, industry-driven framework of framework, or that applicants should be are shown in Figure 1 in a graphic foundational and technical restricted to address only those consisting of nine tiers. competencies that are necessary for competencies identified in the entry-level workers across all framework. Rather, applicants are Foundational Competencies manufacturing sectors. Such a model encouraged to: • Tier 1—Personal Effectiveness framework allows for consistency across • Describe which tiers or Competencies industries, customization within competencies they intend to address or • Tier 2—Academic Competencies sectors, and easy updating to not address; • Tier 3—Workplace Competencies

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Industry Competencies larger society. They are not exclusive to describe the industry-wide • Tier 4—Industry-Wide Technical the competencies needed for a competencies that a training program for Competencies successful career or role in the more experienced workers should • Tier 5—Industry Sector Technical workplace. They are included here address. ETA does not suggest that a Competencies because these competencies also are worker must possess all of these valued by employers, and are often competencies to be employed in Occupational Competencies referred to as ‘‘soft skills.’’ Personal manufacturing, but that these • Tier 6—Occupation-Specific effectiveness competencies are generally competencies should form the basis for Knowledge Areas learned in the home or community and a comprehensive training program for • Tier 7—Occupation-Specific reinforced and honed at school and in entry-level or technician-level workers. Tier 5—Industry-Sector Technical Technical Competencies the workplace. They represent personal Competencies represent a sub-set of • Tier 8—Occupation-Specific attributes that may present some industry technical competencies that are Requirements challenges to teach or assess. Tier 2—Academic Competencies are specific to an industry sector, e.g., • Tier 9—Management Competencies critical competencies primarily learned plastics manufacturing, automotive Tiers 1 through 4 are divided into in a school setting. They include manufacturing, or food products blocks. The blocks on these tiers cognitive functions and thinking styles. manufacturing. represent competency areas, that is, the In varying degrees or to varying levels Occupational Competencies skills, knowledge, abilities and other the content areas academic factors that are essential to successful competencies are likely to apply to all The competencies on Tiers 6, 7, and performance in the industry. For industries and occupations. For 8 are grouped and referred to as example, in the advanced example, the level of mathematical Occupational Competencies. manufacturing competency framework, competency required varies depending Occupational competency models are Tier 4 represents industry-wide upon the work setting such as retail frequently developed to define technical competencies cutting across versus aerospace manufacturing. performance in a workplace, to design all manufacturing sectors. Tiers 5 Tier 3—Workplace Competencies competency-based curriculum, or to through 9 may also contain competency represent motives and traits as well as articulate the requirements for an blocks, but these should be defined for interpersonal and self-management occupational credential such as a each industry-sector or occupation. styles. They generally are applicable to license or certification. Whereas some manufacturing industry a large number of occupations and Tier 6—Occupation-Specific sectors and educational partners have industries. Knowledge Areas define the knowledge already come together to define their that is frequently specific to an Industry Competencies technical and occupational occupation or group of occupations. For competencies, many others have not. The competencies shown on Tiers 4 example, the knowledge and application The arrangement of the tiers in a and 5 are grouped and referred to as of the principles of chemistry or nuclear pyramidal shape represents the Industry Competencies. The cross- power is necessary for only a limited increasing level of specificity and cutting industry-wide technical number of occupations in certain specialization of the content on the competencies make it possible to show industry sectors. Knowledge is often a upper tiers of the graphic. As a user career lattices within an industry key component of transferability among moves through the various tiers of the wherein a worker can move easily occupations. model, the competencies become across industry sub-sectors. As a result, Tier 7—Occupation-Specific specific to certain industries and/or this model supports the development of Technical Competencies are the occupations. The graphic in Figure 1 is an agile workforce, rather than narrowly technical skills required by an not intended to represent a sequential following a single occupational career occupation. For example, knowledge of model, or to imply that all content area ladder. operating a Computer Numerically on a lower tier must be achieved prior Tier 4—Industry-Wide Technical Controlled (CNC) machine may be to tackling a competency on a tier that Competencies represent the knowledge necessary for certain metalworking is at an upper level on the graphic. and skills that are common across the occupations. sectors within a broader industry. These Foundational Competencies Tier 8—Occupation-Specific technical competencies build on, but are Requirements are not truly At the base of the model, tiers 1 more specific than, a competency competencies, but the ‘‘other factors’’ through 3 represent those competencies represented on a lower tier. For essential for work in an occupation. which provide the foundation for example, competency in the use of Holding a valid commercial driver’s success in school and in the world of Manufacturing Resource Planning license would be an example of such a work. Employers have identified a link software builds on Basic Computer requirement. between foundational skills and job Skills. It represents a more complex or Tier 9—Management Competencies performance, as well as the fact that additional level of knowledge and skill. represent the leadership, supervision foundational skills are a needed For this reason, it is essential that and management competencies that are prerequisite for workers to learn new education and training program needed in addition to the professional industry-specific skills. These outcomes provide the foundation for the competencies for executives, managers, foundational competencies are essential more advanced technical competencies. and supervisors in a specific industry or to a large number of occupations and Tier 4 is divided into two sections, firm. industries. entry-level and technician-level. The The placement of a content block on Tier 1—Personal Effectiveness entry-level technical work functions and a specific tier of the model is not as Competencies are shown as hovering content areas describe the industry-wide important as the inclusion of the below the pyramid because these competencies that a training program for content. For example, behaviors that competencies are essential for all life entry-level or relatively new workers support business ethics could be roles—those roles as a member of a should address. The technician-level included under Business Fundamentals, family, of a community, and of the work functions and content areas but could also be considered in the

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Integrity block. The important skills that ensure success in the consideration when developing a model workplace are included. is that the behaviors, knowledge and BILLING CODE 4510–30–P

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[FR Doc. 06–5139 Filed 6–5–06; 8:45 am] BILLING CODE 4610–30–C

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DEPARTMENT OF LABOR information on the financial III. Current Actions transactions and administrative The Department of Labor (DOL) seeks Employment Standards Administration practices of labor organizations. The extension of the current approval to statute also provides, under certain collect this information. An extension is Proposed Collection; Comment circumstances, for reporting by labor necessary because the LMRDA Request organization officers and employees, explicitly requires the reporting and employers, labor relations consultants, ACTION: Notice. establishes the frequency of the required and surety companies. Section 208 of filings. The information collected by the LMRDA authorizes the Secretary to SUMMARY: The Department of Labor, as OLMS is used by union members to issue rules and regulations prescribing part of its continuing effort to reduce help self-govern their unions, by the the form of the required reports. The paperwork and respondent burden, general public, and as research material reporting provisions were devised to conducts a preclearance consultation for both outside researchers and within implement a basic tenet of the LMRDA: program to provide the general public the Department of Labor. The The guarantee of democratic procedures and Federal agencies with an information is also used to assist DOL and safeguards within labor opportunity to comment on proposed and other government agencies in organizations that are designed to and/or continuing collections of detecting improper practices on the part protect the basic rights of union information in accordance with the of labor organizations, their officers members. Section 205 of the LMRDA Paperwork Reduction Act of 1995 and/or representatives, and others and provides that the reports are public (PRA95) [44 U.S.C. 3506(c)(2)(A)]. This is used by Congress in oversight and information. program helps to ensure that requested legislative functions. In addition to The Office of Labor-Management data can be provided in the desired making Forms LM–2, LM–3, LM–4, LM– Standards (OLMS) administers the format, reporting burden (time and 10, LM–20, LM–21, and LM–30 (from reporting provisions of the LMRDA to financial resources) is minimized, fiscal year 2000 to the present) available the statute (29 U.S.C. 431 et seq.) and collection instruments are clearly to the public online free of charge the implementing and interpreting understood, and the impact of collection through its Internet Public Disclosure regulations (29 CFR Chapter IV). This requirements on respondents can be Room, (http://unionreports.dol.gov/ information collection is currently properly assessed. Currently, the olmsWeb/docs/lmrda.htm), OLMS approved for use through November 30, Employment Standards Administration receives and fulfills approximately 210 2006. is soliciting comments concerning the disclosure report requests per month. proposed collection: Labor Organization II. Review Focus Type of Review: Extension. and Auxiliary Reports (LM–1, LM–2, Agency: Employment Standards LM–3, LM–4, LM–10, LM–15, LM–15A, The Department of Labor is Administration. LM–16, LM–20, LM–21, LM–30, and S– particularly interested in comments 1). A copy of the proposed information which: Title: Labor Organization and • Evaluate whether the proposed collection request can be obtained by Auxiliary Reports. collection of information is necessary contacting the office listed below in the OMB Number: 1215–0188. for the proper performance of the addressee section of this Notice. Agency Number: LM–1, LM–2, LM–3, functions of the agency, including LM–4, LM–10, LM–15, LM–15A, LM– DATES: Written comments must be whether the information will have submitted to the office listed in the 16, LM–20, LM–21, LM–30 and S–1. practical utility; Affected Public: Individual or addressee section below on or before • Evaluate the accuracy of the August 7, 2006. households; business or other for-profit; agency’s estimate of the burden of the not-for-profit institutions. ADDRESSES: Ms. Hazel M. Bell, U.S. proposed collection of information, Total Respondents: 27,849. Department of Labor, 200 Constitution including the validity of the Total Responses: 27,849. Ave., NW., Room S–3201, Washington, methodology and assumptions used; DC 20210, telephone (202) 693–0418, • Enhance the quality, utility and Time per Response (Reporting): fax (202) 693–1451, e-mail clarity of the information to be 1,175,450. [email protected]. Please use only one collected; and Time per Response (Recordkeeping): method of transmission for comments • Minimize the burden of the 2,197,804. (mail, fax, or e-mail). collection of information on those who Frequency: Semi-annually and SUPPLEMENTARY INFORMATION are to respond, including through the Annually. use of appropriate automated, Estimated Total Burden Hours: I. Background electronic, mechanical, or other 3,373,254. Congress enacted the Labor- technological collection techniques or Total Burden Cost (capital/startup): Management Reporting and Disclosure other forms of information technology, $0. Act of 1959, as amended (LMRDA), to e.g., permitting electronic submissions Total Burden Cost (operating/ provide for the disclosure of of responses. maintenance): $0.

REPORTING AND RECORDKEEPING BURDEN HOURS

Hours per Hours per Forms Responses respondent for Reporting bur- respondent for Recordkeeping Total hours reporting den hours recordkeeping burden hours

LM–1 ...... 255 0.83 212 0.08 20 232 LM–2 ...... 3,827 146.00 558,742 390.00 1,492,530 2,051,272 LM–3 ...... 10,812 52.00 562,224 64.00 691,968 1,254,192 LM–4 ...... 6,355 8.00 50,840 2.00 12,710 63,550 LM–10 ...... 1,766 0.50 883 0.08 141 1,024 LM–15 ...... 354 1.50 531 0.33 117 648

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REPORTING AND RECORDKEEPING BURDEN HOURS—Continued

Hours per Hours per Forms Responses respondent for Reporting bur- respondent for Recordkeeping Total hours reporting den hours recordkeeping burden hours

LM–15A ...... 68 0.33 22 0.03 2 24 LM–16 ...... 95 0.33 31 0.02 2 33 LM–20 ...... 90 0.33 30 0.03 3 33 LM–21 ...... 11 0.50 6 0.08 1 7 LM–30 ...... 3,494 0.50 1,747 0.08 280 2,027 S–1 ...... 179 0.50 90 0.08 14 104 SARF* ...... 543 0.17 92 0.03 16 108

Total ...... 27,849 ...... 1,175,450 ...... 2,197,804 3,373,254 Note: Some numbers may not add due to rounding. * Simplified Annual Report Format.

Comments submitted in response to Investment Boards, Veterans Service programs that enhance employment and this notice will be summarized and/or Organizations (VSO), local public training opportunities and/or promote included in the request for Office of agencies, and non-profit organizations, self-sufficiency for homeless veterans. Management and Budget approval of the including community and faith-based Residual HVRP funds can be awarded as information collection request; they will organizations. VETS is not authorized to grants to organizations sponsoring Stand also become a matter of public record. award these grant funds to organizations Down events for homeless veterans. Dated: June 1, 2006. that are registered with Internal The critical services provided at a Ruben L. Wiley, Revenue Service (IRS) as a 501(c)(4) Stand Down are often the catalyst that Chief, Branch of Management Review and organization. enables homeless veterans to reenter mainstream society. Some of the Internal Control, Division of Financial DATES: All Stand Down grant requests Management, Office of Management, must be received by the appropriate services available at these events Administration and Planning, Employment State Director for Veterans’ Employment include temporary shelter, showers, Standards Administration. and Training (DVET) who serves as the haircuts, meals, clothing, hygiene kits, [FR Doc. E6–8739 Filed 6–5–06; 8:45 am] Grant Officer Technical Representative medical examinations, immunizations, BILLING CODE 4510–CR–P (GOTR) no later than 60 days prior to legal advice, State identification cards, the event and by no later than June 30, veterans benefit information, training 2006, for events that occur on or prior program information, employment DEPARTMENT OF LABOR to November 30, 2006. Events occurring services, and referral to other supportive after November 30, 2006, application services. Veterans’ Employment and Training Stand Down grant funds must be used will be accepted, and awarded as next Service to enhance employment and training year’s federal appropriations or opportunities or to promote self- FY 2006 Stand Down Grant Requests continuing resolution funding becomes sufficiency for homeless veterans. The available. AGENCY: Veterans’ Employment and funds may be used to support activities Training Service (VETS), Labor. ADDRESSES: Applications for Stand such as: Down grant funding are to be submitted ACTION: Initial announcement of • The purchase of food, bottled water, to the appropriate State DVET/GOTR. available FY 2006 funds under the clothing, sleeping bags and hygiene care Address and contact information for Homeless Veterans’ Reintegration kits; each State DVET/GOTR can be found at: Program to Support Local Stand Down • Rental of facilities and/or tents; http://www2.dol.gov/vets/aboutvets/ Events. • Payment for special one-time contacts/main.htm. electricity costs, equipment rentals, Funding Opportunity No: 17–805. SUPPLEMENTARY INFORMATION: advertising, event posters, portable SUMMARY: The Veterans’ Employment I. Funding Opportunity Description toilets, janitorial/kitchen supplies, and and Training Service (VETS) continues communications/internet access; to support local Stand Down events that Stand Down is a military term • The hiring of security personnel; assist homeless veterans and is now referring to an opportunity to achieve a • Transportation of homeless veterans accepting applications for Stand Down brief respite from combat. Troops would to and from Stand Down events; and grant awards. A Stand Down is an event assemble in a base camp to receive new • Other items and services as held in a local community where clothing, hot food, and a relative degree appropriate. homeless veterans are provided a wide of safety before returning to the front. Stand Down grant funds may not be variety of social services. Under this FY Today more than 160 organizations used to purchase special monogrammed 2006 announcement, VETS anticipates across the country partner with local tee shirts, pen sets, specialty hats that up to $325,000 will be available for businesses, government agencies, and (unless for cold weather use), military grant awards up to a maximum of community- and faith-based service and veteran type patches, and memento $8,000 per event. However, if the event providers to hold Stand Down events for gifts for staff members/visitors/ is held for one (1) day, the maximum homeless veterans and their families in volunteers. amount is $5,000. VETS expects to the local community. award approximately forty (40) grants. Each year, the Assistant Secretary for II. Award Information Applications for Stand Down funds will Veterans’ Employment and Training The maximum amount that can be be accepted from State Workforce awards Homeless Veterans’ awarded to support a local Stand Down Agencies and State and local Workforce Reintegration Program (HVRP) grants to event is $8,000 per year, per event. If the

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event is held for one (1) day, the 4. Budget Narrative describing each USDOL Office of Financial Management maximum amount that can be awarded planned expenditure listed on the SF at (202) 693–4479. is $5,000. 424A; Upon receipt of grant award financial 5. Demonstrate and document Stand documents, HHS/PMS will forward a III. Eligibility Information Down Activities and develop a timeline packet of instructions to the grantee on 1. Eligible Applicants for completion of activities. For Stand how to set up a payment account. After Eligible applicants will generally fall Down events that occur on or after July setting up the account, the grantee will into one of the following categories: 1st, grant applicants must demonstrate be able to draw down funds to State and local Workforce Boards, and document planning activities prior reimburse approved expenses already Veteran Service Organizations, local to the end of the Fiscal Year (September incurred and to cover approved public agencies, and non-profit 30th); expenses that will be paid within three organizations including community and 6. Original signed Assurances and (3) days of the draw down. Funds faith-based organizations. Organizations Certifications Signature Page; requested for draw down through the registered with the Internal Revenue 7. A copy of the Central Contractor HHS/PMS are directly deposited into Service as a 501(c)(4) organization are Registration (CCR) confirmation the account within 24 hours of the not eligible. number. Please do not send the Trader request. Partnership Identification Number Since grantees may draw funds down 2. Cost Sharing or Matching (TPIN) (see Section A.2. above); in more than one quarter, up to and after Cost Sharing and matching funds are 8. Letters of support, particularly from the date of the Stand Down event, not required. However, we do encourage the local One-Stop Career Centers and/ grantees are required to complete a PSC grantees to maximize the resources or Disabled Veterans’ Outreach Program Federal Cash Transaction Report (PS available to the Stand Down event and Specialists (DVOPs) and Local Veterans’ 272) no later than 45 days after the end its participants. Employment Representative (LVER) of each quarter in which grantees staff, the Department of Veterans receive all or part of their grant award 3. Other Eligibility Requirements Affairs, Veterans’ Service Organizations, (February 14th, May 15th, August 14th, Applicant Registration Requirements State and local government agencies, and November 14th). Instructions for completing this requirement are A. All applicants for Federal funding local businesses, local non-profit organizations including community- provided in the HHS/PMS information are required to include a Dun and packet. Grantees are to print hard copies Bradstreet Number (DUNS) with their based and faith-based organizations, etc; when applicable; and of all PSC 272s submitted to provide application. Applicants can obtain a with an Activity and Expenditure DUNS number through the following 9. A copy of the Internal Revenue Service documentation indicating Report that will be submitted after the Web site http:// Stand Down event. www.dunandbradstreet.com/ or by approval of non-profit status (for phone at 1–866–705–5711. example: 501(c)(3), 501(c)(19), etc.) as VI. Required Post-Event Reporting required to verify eligibility when B. After receiving a DUNS number, all No later than 45 calendar days after claiming non-profit status. grant applicants must also register as a the Stand Down event, grantees must vendor with the Central Contractor V. Award Administration Information submit the Stand Down Activity and Registration through the following Web Expenditure Report to the appropriate Stand Down funding is a non- site: http://www.ccr.gov or by phone at DVET/GOTR and to the USDOL competitive grant awarded on a first 1–888–227–2423. CCR registration Procurement Services. If grantees come first serve basis until available should become active within 24 hours experience any delay in submitting this residual funding is exhausted. Funding of completion. If grant applicants have report, they should immediately contact is subject to approval by the Grant questions regarding registration, please their DVET/GOTR and provide a Officer. If approved, the grantee will contact the CCR Assistance Center at 1– justification to request an extension. receive a grant award document and 888–227–2423. The following documents will be financial form to complete in order for After registration, grant applicants needed to complete the Activity and USDOL Office of Financial Management will receive a confirmation number. Expenditure Report: Grantee listed Point of Contact will to set up an account in the Health and • An original signed invoice or list of receive a Trader Partnership Human Services, Payment Management all items purchased with grant funding; Identification Number (TPIN) via mail. System (HHS/PMS) to electronically • Original sales receipts for all The TPIN is, and should remain, a draw down funds. expenditures; confidential password. If awarded funds, the grantee must • Comparison of planned activities submit the completed HHS/PMS and expenditures versus actual IV. Application Content financial forms directly to the U.S. activities and expenditures; All applications for Stand Down Department of Labor (USDOL), Division • SF 269A, Financial Status Report funding must include: of Financial Management Operations in (short form) (available for download at 1. Applicant letter requesting Stand order to electronically draw down http://www.whitehouse.gov/omb/grants/ Down funds (original signed in blue funds. The financial forms should be sf269a.pdf; ink); sent via FedEx, UPS, or other non-U.S. • The Stand Down After Action 2. Application for Federal Assistance, Postal Service provider to avoid Report (provided by the DVET/GOTR); Standard Form 424 (original signed in processing delays. If grantee has and blue ink); previously set-up an electronic HHS/ • Copies of all PSC 272s submitted to 3. SF–424A, Budget Information— PMS account, additional awarded funds HHS/PMS. Non-Construction Programs; SF–424 will be added into that existing bank To prevent processing delays and/or and SF–424A forms can be downloaded account unless otherwise notified in the need to recoup over payments, from the following Web site: http:// writing. Questions or problems relating grantees are strongly encouraged to www.whitehouse.gov/omb/grants/ to the HHS/PMS paperwork or submit the Stand Down Activity and grants_forms.html; processes should be referred to the Expenditure Report to the appropriate

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DVET/GOTR prior to sending the Employment and Training Service Web Services for Persons with Limited originals to Procurement Services. The page http://www.dol.gov/vets, follow English Proficiency, those people with DVET/GOTR will review the report to link for 2006 Stand Down Grants and disabilities who are limited English ensure it is complete and accurate and Required Forms listed under proficient and seek translation services that all expenditures were appropriate announcements.) for these meetings should notify NCD at and allowable. Appendix A: Application for Federal least two weeks before these events. After the DVET/GOTR review for Assistance SF–424 Dated: June 1, 2006. completeness and accuracy, grantees are Appendix B: Budget Information Sheet SF Ethel D. Briggs, to distribute copies of the Activity and 424A Executive Director. Expenditure Report as follows: Appendix C: Certifications and Assurances • The original SF 269A, signed Signature Page [FR Doc. 06–5194 Filed 6–2–06; 2:41 pm] invoice or list of expenditures and the Appendix D: Stand Down After Action BILLING CODE 6820–MA–P Stand Down After Action Report is Report mailed to: [FR Doc. E6–8740 Filed 6–5–06; 8:45 am] U.S. Department of Labor, NATIONAL SCIENCE FOUNDATION BILLING CODE 4510–79–P Procurement Services Center, Room N– 5416, 200 Constitution Avenue, NW., Advisory Committee for GPRA Washington, DC 20210. Performance Assessment (13853)— • Original sales receipts for all Stand NATIONAL COUNCIL ON DISABILITY Notice of Meeting Down expenditures, a copy of the SF Sunshine Act Meetings In accordance with the Federal 269A, signed invoice or list of Advisory Committee Act (Pub. L. 92– expenditures, and Stand Down After TYPE: Quarterly meeting. 463, as amended) the National Science Action Report is to be submitted to the DATE AND TIME: July 25, 2006, 9 a.m.–5 Foundation announces the following appropriate DVET/GOTR. p.m. EST. If the DVET/GOTR does not meeting. Name: Advisory Committee for GPRA recommend approval of a particular LOCATION: Embassy Suites Hotel, 1300 Jefferson Davis Highway, Arlington, VA. Performance Assessment (AC/GPA). expenditure, he/she will notify the Date and Time: June 22, 2006, 8 a.m.– grantee in writing with an explanation STATUS: This meeting will be open to the public and free of charge. 5 p.m., June 23, 2006, 8:30 a.m.–5 p.m. for the disapproval and instruct grantee Place: National Science Foundation, to electronically return the funds to the AGENDA: Reports from the Chairperson 4201 Wilson Boulevard, Arlington, VA HHS/PMS account if already drawn and the Executive Director, Team 22230, Room 375. If you are attending down. All FY 2006 Stand Down Reports, Unfinished Business, New the meeting and need access to the NSF awarded funds must be electronically Business, Announcements, building, please contact Joyce Grainger drawn down by no later than November Adjournment. ([email protected]) for a visitor’s badge. 30, 2006. TYPE: Town Hall Meeting. Contact: Joyce Grainger, BFA/BD, Any grantee who fails to comply with DATE AND TIME: July 26, 2006, 9 a.m.–1 National Science Foundation, Room guidance set forth in the Stand Down 407, Arlington, Virginia. Telephone: Special Grant Provisions and reporting p.m. LOCATION: National Press Club, 703–292–4481. requirements will be excluded from Type of Meeting: Open. consideration of any future funding Ballroom, 13th Floor, 529 14th Street, Purpose of Meeting: To provide requests. NW., Washington, DC. advice and recommendations to the STATUS: This meeting will be open to the VII. Agency Contacts National Science Foundation (NSF) public and free of charge. Director regarding the Foundation’s Questions regarding this AGENDA: A national dialogue on the state performance as it relates to the announcement should be directed to the of disability, keynote addresses, three Government Performance and Results Director for Veterans’ Employment and consecutive panels discussing the goals Act of 1993 (GPRA). Training /GOTR in your State. Contact of the Americans with Disabilities Act, Agenda: Topics include retrospective information for each DVET/GOTR is and audience participation. accomplishments of NSF awards as they located in the VETS Staff Directory at relate to performance indicators the following Web page http:// SUNSHINE ACT MEETING CONTACT: Mark S. Quigley, Director of Communications, associated with the National Science www2.dol.gov/vets/aboutvets/contacts/ Foundation’s Ideas, Tools, People and main.htm or access the directory from NCD, 1331 F Street, NW., Suite 850, Washington, DC 20004; 202–272–2004 Organizational Excellence (I, T, P, OE) the agency Web site at http:// strategic outcome goals; the quality and www.dol.gov/vets. (voice), 202–272–2074 (TTY), 202–272– 2022 (fax). relevance of NSF award portfolios; and issues involving future AC/GPA VIII. Other Information AGENCY MISSION: NCD is an independent performance assessment activity. Current competitive HVRP grantees Federal agency making are not eligible for a separate non- recommendations to the President and Thursday, June 22, 2006 competitive Stand Down grant award as Congress to enhance the quality of life Welcome and Introductions; Charge to described in this announcement. for all Americans with disabilities and the Committee; Overview Presentations Current competitive HVRP grantees are their families. NCD is composed of 15 on NSF Performance Assessment, Merit authorized to utilize existing funds for members appointed by the President Review, Committees of Visitors, Stand Down purposes. and confirmed by the U.S. Senate. transformative Research, and the Signed at Washington, DC, this 30th day of ACCOMMODATIONS: Those needing proposed Strategic Plan. The May, 2006. reasonable accommodations should Committee, in subgroups, will review Eric Vogt, notify NCD at least two weeks before and discuss retrospective Grant Officer. these meetings. accomplishments under the Ideas, Appendices: (Located on U.S. LANGUAGE TRANSLATION: In accordance Tools, People, and Organizational Department of Labor, Veterans’ with E.O. 13166, Improving Access to Excellence strategic goals.

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Friday, June 23, 2006 NUCLEAR REGULATORY or 301–415–4737 or by e-mail to COMMISSION [email protected]. The Committee reconvenes as a Committee of the Whole to hear [Docket No. 50–346] Dated at Rockville, Maryland, this 19th day of May 2006. progress reports from the strategic goals’ FirstEnergy Nuclear Operating For the Nuclear Regulatory Commission. subgroups, discuss findings, Company and FirstEnergy Nuclear Stephen J. Campbell, recommendations, and the preparation Generation Corp.; Notice of Withdrawal of the final report. The Committee will Project Manager, Plant Licensing Branch III– of Application for Amendment to 2, Division of Operating Reactor Licensing, discuss the proposed 2006–2011 Facility Operating License Office of Nuclear Reactor Regulation. Strategic Plan (Draft) with regard to [FR Doc. E6–8705 Filed 6–5–06; 8:45 am] potential impact on the AC/GPA The U.S. Nuclear Regulatory BILLING CODE 7590–01–P performance assessment activity. Commission (the Commission) has granted the request of FirstEnergy Dated: May 31, 2006. Nuclear Operating Company and NUCLEAR REGULATORY Susanne Bolton, FirstEnergy Nuclear Generation Corp. COMMISSION Committee Management Officer. (the licensees) to withdraw its January [FR Doc. 06–5115 Filed 6–5–06; 8:45 am] 5, 2005, application for proposed Notice of Sunshine Act Meetings BILLING CODE 7555–01–M amendment to Facility Operating License No. NPF–3 for the Davis-Besse AGENCY HOLDING THE MEETINGS: Nuclear Nuclear Power Station, Unit 1, located Regulatory Commission. in Ottawa County. DATE: Weeks of June 5, 12, 19, 26, July NATIONAL TRANSPORTATION The proposed amendment would 3, 10, 2006. have revised Technical Specification SAFETY BOARD PLACE: (TS) 3/4.3.2.1, ‘‘Safety Features Commissioners’ Conference Room, 11555 Rockville Pike, Rockville, Notice of Meeting; Sunshine Act Actuation System [SFAS] Instrumentation,’’ to permit a single Maryland. Agenda inoperable SFAS functional unit to be STATUS: Public and closed. placed in a bypassed condition MATTERS TO BE CONSIDERED: TIME: 9:30 a.m., June 13, 2006. indefinitely. Week of June 5, 2006 The Commission had previously PLACE: NTSB Conference Center, 429 issued a Notice of Consideration of Wednesday, June 7, 2006 L’Enfant Plaza SW., Washington, DC Issuance of Amendment published in 20594. 9 a.m. Discussion of Security Issues the Federal Register on February 15, (closed—ex. 1 & 3). STATUS: This one item is open to the 2005 (70 FR 7765). However, in Week of June 12, 2006—Tentative public. response to answering the NRC staff’s request for additional information (RAI) There are no meetings scheduled for MATTER TO BE CONSIDERED: 7793 dated November 23, 2005, the licensees the Week of June 12, 2006. Railroad Accident Report—Collision conducted a preliminary risk evaluation Between Two BNSF Railway Company and determined that a full risk Week of June 19, 2006—Tentative Freight Trains Near Gunter, Texas, May evaluation was too resource intensive There are no meetings scheduled for 19, 2004. and may not yield acceptable results. As the Week of June 19, 2006. a result, the licensees did not submit a NEWS MEDIA CONTACT: Ted Lopatkiewicz. formal response to the RAI. Week of June 26, 2006—Tentative Telephone: (202) 314–6100. Subsequently, by letter dated April 21, There are no meetings scheduled for Individuals requesting specific 2006, the licensees withdrew the the Week of June 26, 2006. accommodations should contact Chris proposed change. Week of July 3, 2006—Tentative Bisett at (202) 314–6305 by Friday, June For further details with respect to this 9, 2006. action, see the application for There are no meetings scheduled for amendment dated January 5, 2005, and the Week of July 3, 2006. The public may view the meeting via the licensees’ letter dated April 21, Week of July 10, 2006—Tentative a live or archived webcast by accessing 2006, which withdrew the application a line under ‘‘News & Events’’ on the for license amendment. Documents may There are no meetings scheduled for NTSB home page at http:// be examined, and/or copied for a fee, at the Week of July 10, 2006. www.ntsb.gov. the NRC’s Public Document Room * * * * * (PDR), located at One White Flint North, FOR MORE INFORMATION CONTACT: Vicky Additional Information Public File Area O1 F21, 11555 D’Onofrio (202) 314–6410. Rockville Pike (first floor), Rockville, The Affirmation of ‘‘Andrew Dated: June 2, 2006. Maryland. Publicly available records Siemaszko, Docket No. 1A–05–021, Vicky D’Onofrio, will be accessible electronically from unpublished Licensing Board Order Federal Register Liaison Officer. the Agencywide Documents Access and (Dec. 22, 2005)’’ which was tentatively scheduled on Wednesday, May 31, [FR Doc. 06–5189 Filed 6–2–06; 1:35 pm] Management Systems (ADAMS) Public Electronic Reading Room on the internet 2006, at 12:55 p.m. has been BILLING CODE 7533–01–M at the NRC Web site, http:// rescheduled tentatively on Friday, June www.nrc.gov/reading-rm.html. Persons 2, 2006, at 3:30 p.m. who do not have access to ADAMS or * * * * * who encounter problems in accessing * The schedule for Commission the documents located in ADAMS meetings is subject to change on short should contact the NRC PDR Reference notice. To verify the status of meetings staff by telephone at 1–800–397–4209, call (recording)—(301) 415–1292.

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Contact person for more information: the pendency before the Commission of will publish in the Federal Register a Michelle Schroll, (301) 415–1662. a request for a hearing from any person. notice of issuance. Should the * * * * * This biweekly notice includes all Commission make a final No Significant The NRC Commission Meeting notices of amendments issued, or Hazards Consideration Determination, Schedule can be found on the Internet proposed to be issued from May 12, any hearing will take place after at: http://www.nrc.gov/what-we-do/ 2006 to May 24, 2006. The last biweekly issuance. The Commission expects that policy-making/schedule.html. notice was published on May 23, 2006 the need to take this action will occur (71 FR 29671). very infrequently. * * * * * Written comments may be submitted Notice of Consideration of Issuance of The NRC provides reasonable by mail to the Chief, Rules and Amendments to Facility Operating accommodation to individuals with Directives Branch, Division of Licenses, Proposed No Significant disabilities where appropriate. If you Administrative Services, Office of Hazards Consideration Determination, need a reasonable accommodation to Administration, U.S. Nuclear Regulatory and Opportunity for a Hearing participate in these public meetings, or Commission, Washington, DC 20555– need this meeting notice or the The Commission has made a 0001, and should cite the publication transcript or other information from the proposed determination that the date and page number of this Federal public meetings in another format (e.g. following amendment requests involve Register notice. Written comments may braille, large print), please notify the no significant hazards consideration. also be delivered to Room 6D22, Two NRC’s Disability Program Coordinator, Under the Commission’s regulations in White Flint North, 11545 Rockville Deborah Chan, at 301–415–7041, TDD: 10 CFR 50.92, this means that operation Pike, Rockville, Maryland, from 7:30 301–415–2100, or by e-mail at of the facility in accordance with the a.m. to 4:15 p.m. Federal workdays. [email protected]. Determinations on proposed amendment would not (1) Copies of written comments received requests for reasonable accommodation involve a significant increase in the may be examined at the Commission’s will be made on a case-by-case basis. probability or consequences of an Public Document Room (PDR), located * * * * * accident previously evaluated; or (2) at One White Flint North, Public File This notice is distributed by mail to create the possibility of a new or Area O1F21, 11555 Rockville Pike (first several hundred subscribers; if you no different kind of accident from any floor), Rockville, Maryland. The filing of longer wish to receive it, of would like accident previously evaluated; or (3) requests for a hearing and petitions for to be added to the distribution, please involve a significant reduction in a leave to intervene is discussed below. contact the Office of the Secretary, margin of safety. The basis for this Within 60 days after the date of Washington, DC 20555 (301–415–1969). proposed determination for each publication of this notice, the licensee In addition, distribution of this meeting amendment request is shown below. may file a request for a hearing with notice over the Internet system is The Commission is seeking public respect to issuance of the amendment to available. If you are interested in comments on this proposed the subject facility operating license and determination. Any comments received receiving this Commission meeting any person whose interest may be within 30 days after the date of schedule electronically, please send an affected by this proceeding and who publication of this notice will be electronic message to [email protected]. wishes to participate as a party in the considered in making any final proceeding must file a written request Dated: June 1, 2006. determination. Within 60 days after the for a hearing and a petition for leave to R. Michelle Schroll, date of publication of this notice, the intervene. Requests for a hearing and a Office of the Secretary. licensee may file a request for a hearing petition for leave to intervene shall be [FR Doc. 06–5163 Filed 6–2–06; 10:21 am] with respect to issuance of the filed in accordance with the BILLING CODE 7590–01–M amendment to the subject facility Commission’s ‘‘Rules of Practice for operating license and any person whose Domestic Licensing Proceedings’’ in 10 interest may be affected by this CFR part 2. Interested persons should NUCLEAR REGULATORY proceeding and who wishes to consult a current copy of 10 CFR 2.309, COMMISSION participate as a party in the proceeding which is available at the Commission’s must file a written request for a hearing PDR, located at One White Flint North, Biweekly Notice; Applications and and a petition for leave to intervene. Public File Area 01F21, 11555 Rockville Amendments to Facility Operating Normally, the Commission will not Pike (first floor), Rockville, Maryland. Licenses Involving No Significant issue the amendment until the Publicly available records will be Hazards Considerations expiration of 60 days after the date of accessible from the Agencywide publication of this notice. The I. Background Documents Access and Management Commission may issue the license System’s (ADAMS) Public Electronic Pursuant to section 189a.(2) of the amendment before expiration of the 60- Reading Room on the Internet at the Atomic Energy Act of 1954, as amended day period provided that its final NRC Web site, http://www.nrc.gov/ (the Act), the U.S. Nuclear Regulatory determination is that the amendment reading-rm/doc-collections/cfr/. If a Commission (the Commission or NRC involves no significant hazards request for a hearing or petition for staff) is publishing this regular biweekly consideration. In addition, the leave to intervene is filed within 60 notice. The Act requires the Commission may issue the amendment days, the Commission or a presiding Commission publish notice of any prior to the expiration of the 30-day officer designated by the Commission or amendments issued, or proposed to be comment period should circumstances by the Chief Administrative Judge of the issued and grants the Commission the change during the 30-day comment Atomic Safety and Licensing Board authority to issue and make period such that failure to act in a Panel, will rule on the request and/or immediately effective any amendment timely way would result, for example in petition; and the Secretary or the Chief to an operating license upon a derating or shutdown of the facility. Administrative Judge of the Atomic determination by the Commission that Should the Commission take action Safety and Licensing Board will issue a such amendment involves no significant prior to the expiration of either the notice of a hearing or an appropriate hazards consideration, notwithstanding comment period or the notice period, it order.

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As required by 10 CFR 2.309, a when the hearing is held. If the final www.nrc.gov/reading-rm/adams.html. If petition for leave to intervene shall set determination is that the amendment you do not have access to ADAMS or if forth with particularity the interest of request involves no significant hazards there are problems in accessing the the petitioner in the proceeding, and consideration, the Commission may documents located in ADAMS, contact how that interest may be affected by the issue the amendment and make it the PDR Reference staff at 1 (800) 397– results of the proceeding. The petition immediately effective, notwithstanding 4209, (301) 415–4737 or by e-mail to should specifically explain the reasons the request for a hearing. Any hearing [email protected]. why intervention should be permitted held would take place after issuance of with particular reference to the the amendment. If the final Carolina Power & Light Company, following general requirements: (1) The determination is that the amendment Docket Nos. 50–325 and 50–324, name, address, and telephone number of request involves a significant hazards Brunswick Steam Electric Plant, Units 1 the requestor or petitioner; (2) the consideration, any hearing held would and 2, Brunswick County, North nature of the requestor’s/petitioner’s take place before the issuance of any Carolina right under the Act to be made a party amendment. Date of amendments request: April to the proceeding; (3) the nature and A request for a hearing or a petition 26, 2006. extent of the requestor’s/petitioner’s for leave to intervene must be filed by: Description of amendment request: property, financial, or other interest in (1) First class mail addressed to the The proposed amendment would the proceeding; and (4) the possible Office of the Secretary of the modify technical specification (TS) effect of any decision or order which Commission, U.S. Nuclear Regulatory requirements for inoperable snubbers by may be entered in the proceeding on the Commission, Washington, DC 20555– adding Limiting Condition for requestor’s/petitioner’s interest. The 0001, Attention: Rulemaking and Operation 3.0.8. The changes are petition must also set forth the specific Adjudications Staff; (2) courier, express consistent with Nuclear Regulatory contentions which the petitioner/ mail, and expedited delivery services: Commission approved Industry/ requestor seeks to have litigated at the Office of the Secretary, Sixteenth Floor, Technical Specification Task Force proceeding. One White Flint North, 11555 Rockville (TSTF) standard TS change TSTF–372, Each contention must consist of a Pike, Rockville, Maryland, 20852, Revision 4. specific statement of the issue of law or Attention: Rulemaking and The NRC staff issued a notice of fact to be raised or controverted. In Adjudications Staff; (3) E-mail availability of a model safety evaluation addition, the petitioner/requestor shall addressed to the Office of the Secretary, and model no significant hazards provide a brief explanation of the bases U.S. Nuclear Regulatory Commission, consideration (NSHC) determination for for the contention and a concise [email protected]; or (4) facsimile referencing in license amendment statement of the alleged facts or expert transmission addressed to the Office of applications in the Federal Register on opinion which support the contention the Secretary, U.S. Nuclear Regulatory May 4, 2005 (70 FR 23252). The licensee and on which the petitioner/requestor Commission, Washington, DC, affirmed the applicability of the model intends to rely in proving the contention Attention: Rulemakings and NSHC determination in its application at the hearing. The petitioner/requestor Adjudications Staff at (301) 415–1101, dated April 26, 2006. must also provide references to those verification number is (301) 415–1966. Basis for proposed no significant specific sources and documents of A copy of the request for hearing and hazards consideration determination: which the petitioner is aware and on petition for leave to intervene should As required by 10 CFR 50.91(a), an which the petitioner/requestor intends also be sent to the Office of the General analysis of the issue of no significant to rely to establish those facts or expert Counsel, U.S. Nuclear Regulatory hazards consideration is presented opinion. The petition must include Commission, Washington, DC 20555– below: sufficient information to show that a 0001, and it is requested that copies be genuine dispute exists with the transmitted either by means of facsimile 1. Does the proposed change involve applicant on a material issue of law or transmission to (301) 415–3725 or by e- a significant increase in the probability fact. Contentions shall be limited to mail to [email protected]. A copy or consequences of an accident matters within the scope of the of the request for hearing and petition previously evaluated? amendment under consideration. The for leave to intervene should also be Response: No. contention must be one which, if sent to the attorney for the licensee. The proposed change allows a delay proven, would entitle the petitioner/ Nontimely requests and/or petitions time before declaring supported TS requestor to relief. A petitioner/ and contentions will not be entertained systems inoperable when the associated requestor who fails to satisfy these absent a determination by the snubber(s) cannot perform its required requirements with respect to at least one Commission or the presiding officer of safety function. Entrance into Actions or contention will not be permitted to the Atomic Safety and Licensing Board delaying entrance into Actions is not an participate as a party. that the petition, request and/or the initiator of any accident previously Those permitted to intervene become contentions should be granted based on evaluated. parties to the proceeding, subject to any a balancing of the factors specified in 10 Consequently, the probability of an limitations in the order granting leave to CFR 2.309(a)(1)(i)–(viii). accident previously evaluated is not intervene, and have the opportunity to For further details with respect to this significantly increased. The participate fully in the conduct of the action, see the application for consequences of an accident while hearing. amendment which is available for relying on the delay time allowed before If a hearing is requested, and the public inspection at the Commission’s declaring a TS supported system Commission has not made a final PDR, located at One White Flint North, inoperable and taking its Conditions determination on the issue of no Public File Area 01F21, 11555 Rockville and Required Actions are no different significant hazards consideration, the Pike (first floor), Rockville, Maryland. than the consequences of an accident Commission will make a final Publicly available records will be under the same plant conditions while determination on the issue of no accessible from the ADAMS Public relying on the existing TS supported significant hazards consideration. The Electronic Reading Room on the Internet system Conditions and Required final determination will serve to decide at the NRC Web site, http:// Actions.

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Therefore, the consequences of an Basis for proposed no significant equipment will be installed) or a change accident previously evaluated are not hazards consideration determination: in the methods governing normal plant significantly increased by this change. As required by 10 CFR 50.91(a), the operation. Therefore, this change does not involve licensee has provided its analysis of the Therefore, this change does not create a significant increase in the probability issue of no significant hazards the possibility of a new or different kind or consequences of an accident consideration, which is presented of accident from any accident previously evaluated. below: previously evaluated. 2. Does the proposed change create 1. Does the proposed change involve the possibility of a new or different kind a significant increase in the probability 3. Does the proposed change involve of accident from any accident or consequences of an accident a significant reduction in a margin of previously evaluated? previously evaluated? safety? Response: No. Response: No. Response: No. The proposed change to relocate The proposed change allows a delay The proposed change to relocate time before declaring supported TS TS 3/4.6.1 to the TRM is administrative in nature and does not involve the TS 3/4.6.1 to the TRM is administrative systems inoperable when the associated in nature, does not negate any existing snubber(s) cannot perform its required modification of any plant equipment or affect basic plant operation. Snubber requirement, and does not adversely safety function. The proposed change affect existing plant safety margins or does not involve a physical alteration of operability and surveillance requirements will be contained in the the reliability of the equipment assumed the plant (no new or different type of to operate in the safety analysis. As equipment will be installed) or a change TRM to ensure design assumptions for such, there are no changes being made in the methods governing normal plant accident mitigation are maintained. to safety analysis assumptions, safety operations. Thus, this change does not The proposed change to add LCO limits or safety system settings that create the possibility of a new or 3.0.8 allows a delay time before would adversely affect plant safety as a different kind of accident from any declaring supported TS systems result of the proposed change. Margins accident previously evaluated. inoperable when the associated of safety are unaffected by requirements 3. Does the proposed change involve snubber(s) cannot perform the required a significant reduction in a margin of safety function. Entrance into actions or that are retained, but relocated from the safety? delaying entrance into actions is not an TS to the TRM. initiator of any accident previously Response: No. [* * *] evaluated. Consequently, the probability The proposed change allows a delay of an accident previously evaluated is The proposed change to add LCO time before declaring supported TS not significantly increased. The station 3.0.8 to TS allows a delay time before systems inoperable when the associated design and safety analysis assumptions declaring supported TS systems snubber(s) cannot perform its required included provisions for redundancy to inoperable when the associated safety function. The proposed change provide for periods when redundant snubber(s) cannot perform the required restores an allowance in the pre-ISTS systems are out-of-service per the TS. safety function. The proposed change conversion TS that was unintentionally The proposed snubber LCO ensures that retains an allowance in the current eliminated by the conversion. The pre- out-of-service time is minimized and VYNPS TS while upgrading it to be ISTS TS were considered to provide an risk is managed per 10 CFR 50.65(a)(4). more conservative for snubbers adequate margin of safety for plant Therefore, the consequences of an supporting multiple trains or sub- operation, as does the post-ISTS accident previously evaluated are not systems of an associated system. The conversion TS. Therefore, this change significantly increased by this change. updated TS will continue to provide an does not involve a significant reduction 2. Does the proposed change create adequate margin of safety for plant in a margin of safety. the possibility of a new or different kind operation upon incorporation of LCO The NRC staff proposes to determine of accident from any accident 3.0.8. The station design and safety that the amendment request involves no previously evaluated? analysis assumptions provide margin in significant hazards consideration. Response: No. the form of redundancy to account for Attorney for licensee: David T. The proposed change to relocate TS 3/ periods of time when system capability Conley, Associate General Counsel II— 4.6.1 to the TRM is administrative and is reduced. This proposed change does Legal Department, Progress Energy does not involve any physical alteration not reduce that margin. Service Company, LLC, Post Office Box of plant equipment. The proposed 1551, Raleigh, North Carolina 27602. change does not change the method by Therefore, this change does not NRC Branch Chief: Michael L. which any safety-related system involve a significant reduction in a Marshall, Jr. performs its function. As such, no new margin of safety. Entergy Nuclear Operations, Inc., or different types of equipment will be The NRC staff has reviewed the Docket No. 50–271, Vermont Yankee installed, and the basic operation of licensee’s analysis and, based on this Nuclear Power Station (VYNPS), installed equipment is unchanged. The review, it appears that the three Vernon, Vermont methods governing plant operation and standards of 50.92(c) are satisfied. testing remain consistent with current Therefore, the NRC staff proposes to Date of amendment request: April 22, safety analysis assumptions. determine that the amendment request 2006. [* * *] involves no significant hazards Description of amendment request: The proposed change to add LCO consideration. The proposed amendment would 3.0.8 allows a delay time before relocate the Technical Specification declaring supported TS systems Attorney for licensee: Travis C. (TS) requirements for shock suppressors inoperable when the associated McCullough, Assistant General Counsel, (snubbers) to the Technical snubber(s) cannot perform the required Entergy Nuclear Operations, Inc., 400 Requirements Manual (TRM) and add a safety function. The proposed change Hamilton Avenue, White Plains, NY new Limiting Condition for Operation does not involve a physical alteration of 10601. (LCO) 3.0.8. the plant (no new or different type of Branch Chief: Richard Laufer.

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Exelon Generation Company, LLC 2. Does the change create the review, it appears that the three (EGC), Docket No. 50–374, LaSalle possibility of a new or different kind of standards of 10 CFR 50.92(c) are County Station, Unit 2, LaSalle County, accident from any accident previously satisfied. Therefore, the NRC staff Illinois evaluated? proposes to determine that the Date of amendment request: April 21, Response: No. requested amendments involve no 2006. The proposed changes for a one-time significant hazards consideration. Description of amendment request: extension of the Type A ILRT for LSCS Attorney for licensee: Mr. Bradley J. The proposed amendment would revise Unit 2 will not affect the control Fewell, Assistant General Counsel, Technical Specification (TS) Section parameters governing unit operation or Exelon Generation Company, LLC, 200 5.5.13, ‘‘Primary Containment Leakage the response of plant equipment to Exelon Way, Kennett Square, PA 19348. Rate Testing Program,’’ to reflect a one- transient and accident conditions. The NRC Branch Chief: Daniel S. Collins proposed changes do not introduce any time extension of the LaSalle County R.E. Ginna Nuclear Power Plant, LLC, new equipment, modes of system Station (LSCS), Unit 2 primary Docket No. 50–244, R.E. Ginna Nuclear operation or failure mechanisms. containment Type A integrated leak rate Power Plant, Wayne County, New York test (ILRT) date from the current Therefore, the proposed changes do Date of amendment request: May 1, requirement of no later than December not create the possibility of a new or 2006. 7, 2008, to prior to startup following the different kind of accident from any Description of amendment request: twelfth LSCS, Unit 2 refueling outage previously evaluated. The proposed amendment would revise (L2R12). 3. Does the change involve a Basis for proposed no significant significant reduction in a margin of Technical Specification (TS) 1.1, hazards consideration determination: safety? ‘‘Definitions,’’ TS 3.4.13, ‘‘RCS [reactor As required by 10 CFR 50.91(a), the Response: No. coolant system] Operational Leakage,’’ LSCS Unit 2 is a General Electric licensee has provided its analysis of the TS 5.5.8, ‘‘Steam Generator Program,’’ issue of no significant hazards BWR/5 plant with a Mark II primary and add new specifications (TS 3.4.17) consideration, which is presented containment. The Mark II primary for ‘‘Steam Generator (SG) Tube below: containment consists of two Integrity’’ and (TS 5.6.7) for ‘‘Steam 1. Does the change involve a compartments, the drywell and the Generator Tube Inspection Report.’’ The significant increase in the probability or suppression chamber. The drywell has proposed changes are necessary in order consequences of an accident previously the shape of a truncated cone, and is to implement the guidance for the evaluated? located above the cylindrically shaped industry initiative on Nuclear Energy Response: No. suppression chamber. The primary Institute (NEI) 97–06, ‘‘Steam Generator The proposed changes will revise containment is penetrated by access, Program Guidelines.’’ LSCS, Unit 2, TS 5.5.13, ‘‘Primary piping and electrical penetrations. The NRC staff issued a notice of Containment Leakage Rate Testing The integrity of the primary opportunity for comment in the Federal Program,’’ to reflect a one-time containment penetrations and isolation Register on March 2, 2005 (70 FR extension of the primary containment valves is verified through Type B and 10298), on possible amendments Type A Integrated Leak Rate Test (ILRT) Type C local leak rate tests (LLRTs) and adopting Technical Specification Task date to ‘‘prior to startup following the overall leak tight integrity of the Force Change Traveller 449, including a L2R12.’’ The current Type A ILRT primary containment is verified by a model safety evaluation and model no interval of 15 years, based on past Type A ILRT, as required by 10 CFR 50, significant hazards consideration performance, would be extended on a Appendix J, ‘‘Primary Reactor (NSHC) determination, using the one-time basis by approximately 2% of Containment Leakage Testing for Water- consolidated line item improvement the current interval. Cooled Power Reactors.’’ These tests are process. The NRC staff subsequently The function of the primary performed to verify the essentially leak issued a notice of availability of the containment is to isolate and contain tight characteristics of the primary models for referencing in license fission products released from the containment at the design basis accident amendment applications in the Federal reactor Primary Coolant System (PCS) pressure. The proposed changes for a Register on May 6, 2005 (70 FR 24126). following a design basis Loss of Coolant one-time extension of the Type A ILRTs The licensee affirmed the applicability Accident (LOCA) and to confine the do not affect the method for Type A, B of the following NSHC determination in postulated release of radioactive or C testing or the test acceptance its application dated May 1, 2006. material to within limits. The test criteria. Basis for proposed no significant interval associated with Type A ILRTs EGC has conducted a risk assessment hazards consideration determination: is not a precursor of any accident to determine the impact of a change to As required by 10 CFR 50.91(a), the previously evaluated. Type A ILRTs the LSCS Unit 2 Type A ILRT schedule licensee has provided its analysis of the provide assurance that the LSCS Unit 2 from a baseline ILRT frequency of three issue of no significant hazards primary containment will not exceed times in ten years to once in 16.25 years consideration, which is presented allowable leakage rate values specified (i.e., 15 years plus 15 months) for the below: in the TS and will continue to perform risk measures of Large Early Release Criterion 1—The Proposed Change Does their design function following an Frequency (i.e., LERF), Total Population Not Involve a Significant Increase in the accident. The risk assessment of the Dose, and Conditional Containment Probability or Consequences of an proposed changes has concluded that Failure Probability (i.e., CCFP). This Accident Previously Evaluated there is an insignificant increase in total assessment indicated that the proposed population dose rate and an LSCS ILRT interval extension has a The proposed change requires an SG insignificant increase in the conditional minimal impact on public risk. Program that includes performance containment failure probability. Therefore, the proposed changes do criteria that will provide reasonable Therefore, the proposed changes do not involve a significant reduction in a assurance that the SG tubing will retain not involve a significant increase in the margin of safety. integrity over the full range of operating probability or consequences of an The NRC staff has reviewed the conditions (including startup, operation accident previously evaluated. licensee’s analysis and, based on this in the power range, hot standby,

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cooldown and all anticipated transients primary to secondary leak rate after the pressure boundary, the SG tubes are included in the design specification). accident is 1 gallon per minute with no unique in that they are also relied upon The SG performance criteria are based more than [500 gallons per day or 720 as a heat transfer surface between the on tube structural integrity, accident gallons per day] in any one SG, and that primary and secondary systems such induced leakage, and operational the reactor coolant activity levels of that residual heat can be removed from LEAKAGE. DOSE EQUIVALENT I–131 are at the TS the primary system. In addition, the SG An SGTR [steam generator tube values before the accident. tubes isolate the radioactive fission rupture] event is one of the design basis The proposed change does not affect products in the primary coolant from accidents that are analyzed as part of a the design of the SGs, their method of the secondary system. In summary, the plant’s licensing basis. In the analysis of operation, or primary coolant chemistry safety function of an SG is maintained a SGTR event, a bounding primary to controls. The proposed approach by ensuring the integrity of its tubes. secondary LEAKAGE rate equal to the updates the current TSs and enhances Steam generator tube integrity is a operational LEAKAGE rate limits in the the requirements for SG inspections. function of the design, environment, licensing basis plus the LEAKAGE rate The proposed change does not adversely and the physical condition of the tube. associated with a double-ended rupture impact any other previously evaluated The proposed change does not affect of a single tube is assumed. design basis accident and is an tube design or operating environment. For other design basis accidents such improvement over the current TSs. The proposed change is expected to as MSLB [main steam line break], rod Therefore, the proposed change does result in an improvement in the tube ejection, and reactor coolant pump not affect the consequences of a SGTR integrity by implementing the SG locked rotor the tubes are assumed to accident and the probability of such an Program to manage SG tube inspection, retain their structural integrity (i.e., they accident is reduced. In addition, the assessment, repair, and plugging. The are assumed not to rupture). These proposed changes do not affect the requirements established by the SG analyses typically assume that primary consequences of an MSLB, rod ejection, Program are consistent with those in the to secondary LEAKAGE for all SGs is 1 or a reactor coolant pump locked rotor applicable design codes and standards gallon per minute or increases to 1 event, or other previously evaluated and are an improvement over the gallon per minute as a result of accident accident. requirements in the current TSs. induced stresses. The accident induced leakage criterion introduced by the Criterion 2—The Proposed Change Does For the above reasons, the margin of proposed changes accounts for tubes Not Create the Possibility of a New or safety is not changed and overall plant that may leak during design basis Different Kind of Accident From Any safety will be enhanced by the proposed accidents. The accident induced leakage Previously Evaluated change to the TS. criterion limits this leakage to no more The proposed performance based The NRC staff proposes to determine than the value assumed in the accident requirements are an improvement over that the amendments request involves analysis. the requirements imposed by the no significant hazards consideration. The SG performance criteria proposed current technical specifications. Attorney for licensee: Daniel F. change to the TS identify the standards Implementation of the proposed SG Stenger, Ballard Spahr Andrews & against which tube integrity is to be Program will not introduce any adverse Ingersoll, LLP, 601 13th Street, NW., measured. Meeting the performance changes to the plant design basis or Suite 1000 South, Washington, DC criteria provides reasonable assurance postulated accidents resulting from 20005. that the SG tubing will remain capable potential tube degradation. The result of NRC Branch Chief: Richard J. Laufer. of fulfilling its specific safety function the implementation of the SG Program of maintaining reactor coolant pressure will be an enhancement of SG tube Southern California Edison Company, et boundary integrity throughout each performance. Primary to secondary al., Docket Nos. 50–361 and 50–362, operating cycle and in the unlikely LEAKAGE that may be experienced San Onofre Nuclear Generating Station, event of a design basis accident. The during all plant conditions will be Units 2 and 3, San Diego County, performance criteria are only a part of monitored to ensure it remains within California the SG Program required by the current accident analysis assumptions. Date of amendment requests: April proposed change to the TS. The The proposed change does not affect 28, 2006. program, defined by NEI 97–06, Steam the design of the SGs, their method of Description of amendment requests: Generator Program Guidelines, includes operation, or primary or secondary The proposed change will increase the a framework that incorporates a balance coolant chemistry controls. In addition, minimum allowed boron concentration of prevention, inspection, evaluation, the proposed change does not impact of the spent fuel pool and allow credit repair, and leakage monitoring. The any other plant system or component. for soluble boron, guide tube inserts proposed changes do not, therefore, The change enhances SG inspection (GT-Inserts) made from borated stainless significantly increase the probability of requirements. steel, and fuel storage patterns in place an accident previously evaluated. Therefore, the proposed change does of Boraflex. The consequences of design basis not create the possibility of a new or Basis for proposed no significant accidents are, in part, functions of the different [kind] of accident from any hazards consideration determination: DOSE EQUIVALENT I–131 in the accident previously evaluated. primary coolant and the primary to As required by 10 CFR 50.91(a), the secondary LEAKAGE rates resulting Criterion 3—The Proposed Change Does licensee has provided its analysis of the from an accident. Therefore, limits are Not Involve a Significant Reduction in issue of no significant hazards included in the plant technical [a] Margin of Safety consideration, which is presented specifications for operational leakage The SG tubes in pressurized water below: and for DOSE EQUIVALENT I–131 in reactors are an integral part of the 1. Does the proposed change involve primary coolant to ensure the plant is reactor coolant pressure boundary and, a significant increase in the probability operated within its analyzed condition. as such, are relied upon to maintain the or consequences of an accident The typical analysis of the limiting primary system’s pressure and previously evaluated? design basis accident assumes that inventory. As part of the reactor coolant Response: No.

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Dropped Fuel Assembly Fuel Misloading normal cooling to the spent fuel pool There is no significant increase in the will not be increased. There is no significant increase in the The thermal considerations of the fuel probability of the accidental misloading probability of a fuel assembly drop are unaffected by the presence of the of spent fuel assemblies into the spent accident in the spent fuel pool when GT-Inserts because the guide tube is fuel racks when assuming a complete assuming a complete loss of the Boraflex designed for the presence of a CEA; loss of the Boraflex panels and panels in the spent fuel pool racks and therefore, it is not a primary coolant considering the presence of soluble considering the presence of soluble flow area. The fuel rack normal thermal boron in the pool water for criticality boron in the spent fuel pool water for cooling and malfunctioned blocked control. Fuel assembly placement will cooling scenarios are unaffected by the criticality control. continue to be controlled pursuant to presence of the GT-Inserts in the fuel Neither the presence of soluble boron approved fuel handling procedures and assemblies. in the spent fuel pool water, nor the will be in accordance with Technical The proposed change does not placement of borated stainless steel Specification (TS) 3.7.18[,] ‘‘Spent Fuel involve an increase in the probability or guide tube inserts (GT-Inserts) in the Assembly Storage[,]’’ and Licensee consequences of an accident previously fuel assemblies for criticality control, Controlled Specification (LCS) 4.0.100, evaluated. will increase the probability of a fuel ‘‘Fuel Storage Patterns,’’ which will 2. Does the proposed change create assembly drop accident. The handling specify spent fuel rack storage the possibility of a new or different kind of the fuel assemblies in the spent fuel configuration limitations. of accident from any accident pool has always been performed in There is no increase in the previously evaluated? borated water, and the quantity of consequences of the accidental Response: No. Boraflex remaining in the racks or GT- misloading of a spent fuel assembly into The consideration of criticality Inserts placed in the fuel assemblies, the spent fuel racks. The criticality accidents in the spent fuel pool are not has no affect on the probability of such analysis, performed by SCE, new or different. They have been a drop accident. demonstrates that the pool Keff will be analyzed in the Updated Final Safety maintained less than or equal to 0.95 Analysis Report (UFSAR) and in Southern California Edison (SCE) has following an accidental misloading by previous submittals to the NRC. Specific performed a criticality analysis which the boron concentration of the pool. The accidents considered and evaluated shows that the consequences of a fuel proposed TS 3.7.17[,] ‘‘Fuel Storage include fuel assembly drop, fuel assembly drop accident in the spent fuel Pool Boron Concentration[,]’’ will assembly misloading in the racks, and pool are not affected when considering ensure that an adequate spent fuel pool spent fuel pool water temperature a complete loss of the Boraflex in the boron concentration is maintained. changes. spent fuel racks and the presence of The possibility for creating a new or Change in Spent Fuel Temperature soluble boron. The rack Keff remains less different kind of accident is not than or equal to 0.95. There is no significant increase in the credible. Neither Boraflex [n]or soluble The fuel, the fuel rack, and the fuel probability of either the loss of normal boron are accident initiators. The pool qualifications have been evaluated cooling to the spent fuel pool water or proposed change takes credit for soluble and determined to be unaffected by the a decrease in pool water temperature boron in the spent fuel pool while installation of the GT-Inserts. The from a large emergency makeup when maintaining the necessary margin of mechanical design configuration of the assuming a complete loss of the Boraflex safety. Because soluble boron has GT-Inserts is similar to the shape, size, panels and considering the presence of always been present in the spent fuel soluble boron in the spent fuel pool and weight of a control element pool, a dilution of the spent fuel pool water. A high proposed concentration assembly (CEA) finger. Each of the GT- soluble boron has always been a (>2000 parts per million (ppm)) of Inserts are approximately 0.78 inch possibility. However, a criticality soluble boron is consistent with current accident resulting from a dilution outside diameter (OD) solid stainless operating practices maintained in the accident was not considered credible. steel, with a boron content of spent fuel pool water. The proposed For this proposed amendment, SCE approximately 2 weight percent (w/o). A minimum boron concentration of 2000 performed a spent fuel pool dilution small counterbore is machined at the ppm in TS 3.7.17 will ensure that an analysis, which demonstrated that a top for handling and a rounded bottom adequate concentration is maintained in dilution of the boron concentration in is machined. The OD of these GT-Inserts the spent fuel pools. the spent fuel pool water which could is less than that of a CEA finger. The A loss of normal cooling to the spent increase the rack Keff to greater than 0.95 material (borated stainless steel) is fuel pool water causes an increase in the (constituting a reduction of the required American Society for Testing and temperature of the water passing margin to criticality) is not a credible Materials (ASTM) approved and has through the stored fuel assemblies. This event. The requirement to maintain been licensed by the United States causes a decrease in the water density, boron concentration in the spent fuel Nuclear Regulatory Commission (NRC) and when coupled with the assumption pool water for reactivity control will for use in spent fuel storage of a complete loss of Boraflex, may have no effect on normal pool technologies and spent fuel pools. The result in a positive reactivity addition. operations and maintenance. There are structural effect of the weight of the GT- However, the additional negative no changes in equipment design or Inserts on the fuel, the fuel rack, and the reactivity provided by the boron plant configuration. fuel pool structural interfaces and drop concentration limit in the proposed TS The possibility of accidentally qualifications are unaffected. This is 3.7.17 will compensate for the increased withdrawing a GT-Insert is minimized because the addition of five GT-Inserts reactivity which could result from a loss because special tooling is required to (which increases the dry weight of a fuel of spent fuel pool cooling. Because remove it, and it is completely assembly by 110 lbs.) brings the total adequate soluble boron will be contained within the guide tubes of the weight to 1551 lbs. which is enveloped maintained in the spent fuel pool water designated assemblies. Potential by the 2904 lbs. assumed in the to maintain Keff less than or equal to misloading of the GT-Inserts is calculation for fuel rack design. 0.95, the consequences of a loss of minimized due to the design of the

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installation equipment, procedural boron. SCE evaluated the loss of a Level—Wide Range, and the AFW Flow controls, and double verification that substantial amount of soluble boron does not involve a significant increase will be in place to ensure the GT-Inserts from the spent fuel pool water which in the probability of an accident are installed properly. could lead to Keff exceeding 0.95 and previously evaluated because these are The possibility of accidentally showed that it was not credible. accident monitoring functions that have withdrawing a CEA is minimized Also, the spent fuel rack Keff will no effect on the potential for accident because specialized tooling is required remain less than 1.0 with the spent fuel initiation. The proposed deletion of the for withdrawing a CEA from a fuel pool flooded with unborated water. existing requirements in ACTION 38 is assembly. It is physically possible for Decay heat, radiological effects, and an administrative change. Since these the spent fuel handling tool to bind on seismic loads are unchanged by the requirements are not currently applied a CEA after ungrappling from a fuel absence of Boraflex. to any plant equipment, this change assembly and raising the tool. However, The mechanical properties and the cannot affect the probability of any existing SONGS [San Onofre Nuclear weight of the fuel assemblies remain accident previously evaluated. Generating Station] procedures require essentially unchanged with the The proposed increase in the allowed that the operator validate ‘‘tool weight inclusion of the weight of five GT- outage times for the Reactor Coolant only’’ on the spent fuel handling Inserts per assembly. The original Outlet Temperature—Wide Range, machine’s load cell read out after mechanical and thermal analysis of the Reactor Coolant Inlet Temperature— ungrappling from a fuel assembly and fuel assembly/fuel rack and fuel pool Wide Range, Steam Generator [Water] raising the hoist slightly, and to report building interfaces currently approved Level—Wide Range, and AFW Flow this information to the engineer remain valid and conservative. does not involve a significant increase directing the fuel movement. Therefore, the proposed change does in the consequences of an accident Therefore, the proposed change will not involve a significant reduction in previously evaluated because the not result in the possibility of a new or the plant’s margin of safety. availability of redundant and diverse different kind of accident from any The NRC staff has reviewed the indications provides adequate assurance accident previously evaluated. licensee’s analysis and, based on this that the operator will be able to 3. Does the proposed change involve review, it appears that the three determine the post-accident status of the a significant reduction in a margin of standards of 10 CFR 50.92(c) are secondary heat sink. safety? satisfied. Therefore, the NRC staff The proposed deletion of the existing Response: No. proposes to determine that the requirements in ACTION 38 is an The TS changes proposed by this amendment requests involve no administrative change. Since these license amendment request and the significant hazards consideration. requirements are not currently applied resulting spent fuel storage operation Attorney for licensee: Douglas K. to any plant equipment, this change limits will provide adequate safety Porter, Esquire, Southern California cannot affect the consequence of any margin to ensure that the stored fuel Edison Company, 2244 Walnut Grove accident previously evaluated. assembly array will always remain Avenue, Rosemead, California 91770. (2) Does the proposed change create subcritical. Those limits are based on a NRC Branch Chief: David Terao. the possibility of a new or different kind San Onofre Nuclear Generating Station of accident from any accident (SONGS) Units 2 and 3 plant specific STP Nuclear Operating Company, Docket Nos. 50–498 and 50–499, South previously evaluated? analysis that was performed in Response: No. accordance with a methodology Texas Project, Units 1 and 2, Matagorda The proposed increase in the allowed previously approved by the NRC. County, Texas outage times for the Reactor Coolant The proposed change takes partial Date of amendment request: March Outlet Temperature—Wide Range, credit for soluble boron in the spent fuel 30, 2006. Reactor Coolant Inlet Temperature— pool. SCE’s analyses show that spent Description of amendment request: Wide Range, Steam Generator [Water] fuel storage requirements meet the The proposed amendments revise Level—Wide Range, and the AFW Flow following NRC acceptance criteria for Technical Specification 3.3.3.6, does not create the possibility of a new preventing criticality outside the ‘‘Accident Monitoring Instrumentation,’’ or different kind accident from any reactor. with respect to the required action for accident previously evaluated because (1) The neutron multiplication factor, inoperable Wide Range Reactor Coolant the proposed change affects only the Keff, including all uncertainties, shall be Temperature, Wide Range Steam allowed outage time for accident less than 1.0 when flooded with Generator Water Level, and Auxiliary monitoring instrumentation and unborated water, and Feedwater (AFW) Flow. involves no changes to plant design, (2) The neutron multiplication factor, Basis for proposed no significant plant configuration or operating Keff, including all uncertainties, shall be hazards consideration determination: procedures. less than or equal to 0.95 when flooded As required by 10 CFR 50.91(a), the The proposed deletion of the existing with borated water. licensee has provided its analysis of the requirements in ACTION 38 is an The criticality analysis utilized credit issue of no significant hazards administrative change. Since these for soluble boron to ensure Keff will be consideration, which is presented requirements are not currently applied less than or equal to 0.95 under normal below: to any plant equipment, this change circumstances, and storage (1) Does the proposed change involve cannot create the possibility of any kind configurations have been defined using a significant increase in the probability of accident. a 95/95 Keff calculation to ensure that or consequences of an accident (3) Does the proposed change involve the spent fuel rack will be less than 1.0 previously evaluated? a significant reduction in a margin of with no soluble boron. Soluble boron Response: No. safety? credit is used to provide safety margin The proposed increase in the allowed Response: No. by maintaining Keff less than or equal to outage times for the Reactor Coolant The proposed increase in the allowed 0.95 including uncertainties, Outlet Temperature—Wide Range, outage times for the Reactor Coolant tolerances[,] and accident conditions in Reactor Coolant Inlet Temperature— Outlet Temperature—Wide Range, the presence of spent fuel pool soluble Wide Range, Steam Generator [Water] Reactor Coolant Inlet Temperature—

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Wide Range, Steam Generator [Water] consequences of an accident previously Specifications (TS) 3.3.1, 3.3.2, 3.4.5, Level—Wide Range, and AFW Flow evaluated. 3.4.6, and 3.4.7, ‘‘Reactor Trip System does not involve a significant reduction 2. Do the proposed changes create the (RTS) Instrumentation,’’ ‘‘Engineered in the margin of safety because the possibility of a new or different kind of Safety Feature System Actuation availability of redundant and diverse accident from any accident previously (ESFAS) Instrumentation,’’ ‘‘RCS indications provides adequate assurance evaluated? [Reactor Coolant System] Mode 3,’’ that the operator will be able to Response: No. ‘‘RCS Loops-Mode 4,’’ and ‘‘RCS Loops- determine the post-accident status of the The proposed change involves an Mode 5, Loops Filled,’’ respectively. secondary heat sink. administrative change only. Technical The revisions reflect the different steam The proposed deletion of the existing Specification 5.6.5 is being changed to generator water level trip setpoints and requirements in ACTION 38 is an reference the revised accident analysis steam generator inventory requirements administrative change. Since these methodologies currently under NRC associated with the planned requirements are not currently applied review. No actual plant equipment will replacement of the steam generators in to any plant equipment, this change be affected by the proposed change. Comanche Peak Steam Electric Station, cannot affect the margin of safety. Therefore, the proposed change does not Unit 1. The NRC staff has reviewed the create the possibility of a new or Basis for proposed no significant licensee’s analysis and, based on this different kind of accident from any hazards consideration determination: review, it appears that the standards of previously evaluated. As required by 10 CFR 50.91(a), the 10 CFR 50.92(c) are satisfied. Therefore, 3. Do the proposed changes involve a licensee has provided its analysis of the the NRC staff proposes to determine that significant reduction in a margin of issue of no significant hazards the request for amendments involves no safety? consideration, which is presented significant hazards consideration. Response: No. below: Margin of safety is associated with the Attorney for licensee: A.H. Gutterman, 1. Do the proposed changes involve a confidence in the ability of the fission Esq., Morgan, Lewis & Bockius, 1111 significant increase in the probability or product barriers (i.e., fuel and fuel Pennsylvania Avenue, NW., consequences of an accident previously cladding, Reactor Coolant System Washington, DC 20004. evaluated? pressure boundary, and containment Response: No. NRC Branch Chief: David Terao. structure) to limit the level of radiation The proposed TS changes affect the TXU Generation Company LP, Docket dose to the public. This request involves protective and mitigative capabilities of Nos. 50–445 and 50–446, Comanche an administrative change (subject to the plant; none of the changes impact Peak Steam Electric Station, Units 1 and NRC approval) only to incorporate the the initiation or probability of 2, Somervell County, Texas NRC-approved methodologies into the occurrence of any accident. allowable analysis methodologies The consequences of accidents Date of amendment request: February specified in Technical Specification evaluated in the FSAR [Final Safety 21, 2006. 5.6.5. No actual plant equipment will be Analysis Report] that could be affected Brief description of amendments: The affected by the proposed change. The by this proposed change are those in amendments revise Technical compliance of the revised methodology which the steam generator water level Specification (TS) 5.6.5 entitled, ‘‘Core with the requirements of 10 CFR 50.46 trip functions are credited for initiating Operating Limits Report (COLR),’’ to and Appendix K will be addressed a protective or mitigative function. revise the listed Loss-of-Coolant through the NRC staff’s review of the These transients and accidents have Accident (LOCA) and non-LOCA topical reports. Therefore, it is been analyzed and all relevant event analysis methodologies used at concluded that the use of the proposed acceptance criteria were shown to be Comanche Peak Steam Electric Station, methodology will not degrade the satisfied. The radiological dose Units 1 and 2. confidence in the ability of the fission consequences are unaffected. Therefore, Basis for proposed no significant product barriers to limit the level of there is no increase in the consequences hazards consideration determination: radiation dose to the public. Therefore of an accident previously evaluated. As required by 10 CFR 50.91(a), the the proposed change does not involve a The actual proposed setpoint values licensee has provided its analysis of the reduction in a margin of safety. were determined using an uncertainty issue of no significant hazards The NRC staff has reviewed the methodology previously approved by consideration, which is presented licensee’s analysis and, based on this the NRC for this application. These below: review, it appears that the three values provide adequate assurance that 1. Do the proposed changes involve a standards of 10 CFR 50.92(c) are required protective and mitigative significant increase in the probability or satisfied. Therefore, the NRC staff functions will be initiated as assumed in consequences of an accident previously proposes to determine that the the transient and accident analyses. evaluated? amendment request involves no Therefore, there is no increase in the Response: No. significant hazards consideration. consequences of an accident previously The proposed change involves an Attorney for licensee: George L. Edgar, evaluated. administrative change only. Designation Esq., Morgan, Lewis and Bockius, 1800 The proposed revisions to the D76 of the accident analysis methodologies, M Street, NW., Washington, DC 20036. steam generator inventory, required to described in ERX–04–004 and ERX–04– NRC Branch Chief: David Terao. ensure that the steam generators can 005, as approved analytical methods is provide an effective heat sink, are required to maintain the accuracy of the TXU Generation Company LP, Docket consistent with the current design Technical Specification 5.6.5 (Core Nos. 50–445 and 50–446, Comanche requirements. Therefore, the proposed Operating Limits Report) and to Peak Steam Electric Station, Units 1 and changes do not involve a significant maintain consistency with the 2, Somervell County, Texas increase in the probability or resolution of issues as prescribed in 10 Date of amendment request: February consequences of an accident previously CFR 50.46. Therefore, the proposed 21, 2006. evaluated. changes do not involve a significant Brief description of amendments: The 2. Do the proposed changes create the increase in the probability or amendments would revise Technical possibility of a new or different kind of

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accident from any accident previously same as above. They were published as Unless otherwise indicated, the evaluated? individual notices either because time Commission has determined that these Response: No. did not allow the Commission to wait amendments satisfy the criteria for No new accident scenarios, transient for this biweekly notice or because the categorical exclusion in accordance precursors, failure mechanisms, or action involved exigent circumstances. with 10 CFR 51.22. Therefore, pursuant limiting single failures are introduced as They are repeated here because the to 10 CFR 51.22(b), no environmental a result of these changes. There will be biweekly notice lists all amendments impact statement or environmental no adverse effect or challenges imposed issued or proposed to be issued assessment need be prepared for these on any safety-related system as a result involving no significant hazards amendments. If the Commission has of these changes. There are no changes consideration. prepared an environmental assessment which would cause the malfunction of For details, see the individual notice under the special circumstances safety-related equipment, assumed to be in the Federal Register on the day and provision in 10 CFR 51.12(b) and has operable in the accident analyses, as a page cited. This notice does not extend made a determination based on that result of the proposed Technical the notice period of the original notice. assessment, it is so indicated. Specification changes. No new For further details with respect to the Georgia Power Company, Docket Nos. equipment performance burdens are action see (1) the applications for 50–321 and 50–366, Edwin I. Hatch imposed. The possibility of a new or amendment, (2) the amendment, and (3) Nuclear Plant, Unit Nos. 1 and 2, different malfunction of safety-related the Commission’s related letter, Safety Appling County, Georgia equipment is not created. Therefore, the Evaluation and/or Environmental proposed change does not create the Date of amendment request: March Assessment as indicated. All of these possibility of a new or different kind of 17, 2006. items are available for public inspection accident from any previously evaluated. Brief description of amendment at the Commission’s Public Document 3. Do the proposed changes involve a request: The proposed amendment Room (PDR), located at One White Flint significant reduction in a margin of would add a license condition to North, Public File Area 01F21, 11555 safety? Section 2.C of the Edwin I. Hatch Rockville Pike (first floor), Rockville, Response: No. Nuclear Plant, Unit Nos. 1 and 2, Maryland. Publicly available records The proposed changes to the Steam Operating Licenses. This license will be accessible from the Agencywide Generator Water Level-Low-Low and condition will authorize the licensee to Documents Access and Management Steam Generator Water Level-High-High credit administering potassium iodide Systems (ADAMS) Public Electronic trip function setpoints protect the (KI) to reduce the 30-day post-accident Reading Room on the Internet at the assumed safety analysis limits thyroid radiological dose to the NRC Web site, http://www.nrc.gov/ established in the transient and accident operators in the main control room for reading-rm/adams.html. If you do not analyses. When used in the transient an interim period of approximately 4 have access to ADAMS or if there are and accident analyses, all relevant event years. In addition, the design-basis problems in accessing the documents acceptance criteria are satisfied. accident analysis section of the Updated located in ADAMS, contact the PDR Therefore, these proposed changes do Final Safety Analysis Reports will be Reference staff at 1 (800) 397–4209, not result in the reduction in a margin updated to reflect crediting of KI. (301) 415–4737 or by e-mail to of safety. Date of publication of individual [email protected]. The proposed changes to the D76 notice in Federal Register: March 27, steam generator inventory requirements, 2006 (71 FR 15223). Entergy Gulf States, Inc., and Entergy which ensure the steam generators can Expiration date of individual notice: Operations, Inc., Docket No. 50–458, function as an effective heat sink during 30-day date April 26, 2006; 60-day date River Bend Station, Unit 1, West required shutdown operating modes, are May 26, 2006. Feliciana Parish, Louisiana consistent with the existing design and Notice of Issuance of Amendments to Date of amendment request: licensing bases. Therefore, these Facility Operating Licenses December 19, 2005. proposed changes do not result in the Brief description of amendment: The reduction in a margin of safety. During the period since publication of amendment revised the Technical The NRC staff has reviewed the the last biweekly notice, the Specification (TS) to make permanent licensee’s analysis and, based on this Commission has issued the following the temporary changes to TS Table review, it appears that the three amendments. The Commission has 3.3.8.1–1 previously approved by standards of 10 CFR 50.92(c) are determined for each of these Amendment No. 147. TS Table 3.3.8.1– satisfied. Therefore, the NRC staff amendments that the application 1 is revised to delete the temporary proposes to determine that the complies with the standards and note, correct the number of Required amendment request involves no requirements of the Atomic Energy Act Channels per Division for the Loss of significant hazards consideration. of 1954, as amended (the Act), and the Power (LOP) time delay functions, and Attorney for licensee: George L. Edgar, Commission’s rules and regulations. delete the requirement to perform Esq., Morgan, Lewis and Bockius, 1800 The Commission has made appropriate Surveillance Requirement 3.3.8.1.2, the M Street, NW., Washington, DC 20036. findings as required by the Act and the monthly Channel Functional Test, on NRC Branch Chief: David Terao. Commission’s rules and regulations in certain LOP time delay functions. 10 CFR Chapter I, which are set forth in Previously Published Notices of Date of issuance: May 17, 2006. the license amendment. Effective date: As of the date of Consideration of Issuance of Notice of Consideration of Issuance of issuance and shall be implemented Amendments to Facility Operating Amendment to Facility Operating prior to expiration of the temporary Licenses, Proposed No Significant License, Proposed No Significant change on June 1, 2006, provided by Hazards Consideration Determination, Hazards Consideration Determination, Amendment No. 147. and Opportunity for a Hearing and Opportunity for a Hearing in Amendment No.: 151. The following notices were previously connection with these actions was Facility Operating License No. NPF– published as separate individual published in the Federal Register as 47: The amendment revised the notices. The notice content was the indicated. Technical Specfications.

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Date of initial notice in Federal Effective date: As of the date of Specification 3.7.5, ‘‘Auxiliary Register: March 14, 2006 (71 FR issuance and shall be implemented Feedwater (AFW) System,’’ to change 13173). within 60 days. the frequency of Surveillance The Commission’s related evaluation Amendment No.: 145. Requirement 3.7.5.6 from 92 days to 24 of the amendment is contained in a Renewed Facility Operating License months. Safety Evaluation dated May 17, 2006. No. NPF–16: Amendment revised the Date of issuance: May 17, 2006. No significant hazards consideration TS. Effective date: As of the date of comments received: No. Date of initial notice in Federal issuance, and shall be implemented Register: December 20, 2005 (70 FR within 120 days of issuance. Exelon Generation Company, LLC, and 75492). The February 28, March 28 and Amendment Nos.: 186 and 188. PSEG Nuclear LLC, Docket No. 50–278, April 24, 2006, supplements did not Facility Operating License Nos. DPR– Peach Bottom Atomic Power Station, affect the original proposed no 80 and DPR–82: The amendments Unit 3, York and Lancaster Counties, significant hazards determination, or revised the Technical Specifications. Pennsylvania expand the scope of the request as Date of initial notice in Federal Date of application for amendment: noticed in the Federal Register. Register: October 11, 2005 (70 FR July 6, 2005, as supplemented March 15 The Commission’s related evaluation 59086). and April 7, 2006. of the amendment is contained in a The Commission’s related evaluation Brief description of amendments: The Safety Evaluation dated May 16, 2006. of the amendments is contained in a proposed changes extend the use of the No significant hazards consideration Safety Evaluation dated May 17, 2006. Peach Bottom Atomic Power Station, comments received: No. No significant hazards consideration comments received: No. Unit 3, pressure-temperature (P–T) FPL Energy Seabrook, LLC, Docket No. limits specified in the Technical 50–443, Seabrook Station, Unit No. 1, South Carolina Electric & Gas Company, Specifications (TSs) from 22 to 32 Rockingham County, New Hampshire South Carolina Public Service effective full-power years. Authority, Docket No. 50–395, Virgil C. Date of issuance: May 12, 2006. Date of amendment request: September 22, 2005, as supplemented Summer Nuclear Station, Unit No. 1, Effective date: As of the date of Fairfield County, South Carolina issuance, to be implemented within 60 by letters dated March 24, 2006, and days. April 28, 2006. Date of application for amendment: Description of amendment request: November 29, 2005. Amendment No.: 263. The proposed amendment revised the Brief description of amendment: This Renewed Facility Operating License Seabrook Station, Unit No. 1 Technical amendment for V. C. Summer revises No. DPR–56: The amendment revised Specifications (TSS) to increase the TSs by eliminating the requirements to the TSs. licensed thermal power level by 1.7% to submit monthly operating reports and Federal Date of initial notice in 3648 megawatts thermal. certain annual reports. Register: August 2, 2005 (70 FR 44402). Date of issuance: May 22, 2006. Date of issuance: May 19, 2006. The supplements dated March 15, 2006, Effective date: As of its date of Effective date: As of the date of and April 7, 2006, provided additional issuance, and shall be implemented issuance and shall be implemented information that clarified the within 12 months. within 60 days. application, did not expand the scope of Amendment No.: 110. Amendment No.: 175. the application as originally noticed, Facility Operating License No. NPF– Renewed Facility Operating License and did not change the staff’s original 86: The amendment revised the Tss and No. NPF–12: Amendment revises the proposed no significant hazards the License. Technical Specifications. consideration determination. The Date of initial notice in Federal Date of initial notice in Federal Commission’s related evaluation of the Register: November 8, 2005 (70 FR Register: March 14, 2006 (71 FR amendment is contained in a Safety 67748). The licensee’s letters dated 13178). Evaluation dated May 12, 2006. March 24, 2006, and April 28, 2006, The Commission’s related evaluation No significant hazards consideration provided clarifying information that did of the amendment is contained in a comments received: No. not change the scope of the proposed Safety Evaluation dated May 19, 2006. Florida Power and Light Company, et amendment as described in the original No significant hazards consideration al., Docket No. 50–389, St. Lucie Plant, notice of proposed action published in comments received: No. the Federal Register, and did not Unit No. 2, St. Lucie County, Florida Tennessee Valley Authority, Docket No. change the initial proposed no 50–390, Watts Bar Nuclear Plant, Unit 1, Date of application for amendment: significant hazards consideration Rhea County, Tennessee October 21, 2005, as supplemented determination. February 28, March 28 and April 24, The Commission’s related evaluation Date of application for amendment: 2006. of the amendment is contained in a December 13, 2005. Brief description of amendment: The Safety Evaluation dated May 22, 2006. Brief description of amendment: The amendment revised the Operating No significant hazards consideration amendment changes the steam generator License and Technical Specifications to comments received: No. (SG) level requirement for Limiting allow operation of St. Lucie Unit 2 with Condition for Operation 3.4.7.b and a reduced reactor coolant system flow Pacific Gas and Electric Company, Surveillance Requirements 3.4.5.2, rate of 300,000 gpm and a reduction in Docket Nos. 50–275 and 50–323, Diablo 3.4.6.3 and 3.4.7.2 from greater than or the maximum thermal power to 89 Canyon Nuclear Power Plant, Unit Nos. equal (≥) to 6 percent (%) to ≥ 32% percent of the rated thermal power. The 1 and 2, San Luis Obispo County, following replacement of the SGs during flow rate of 300,000 gpm conservatively California the Unit 1, Cycle 7 refueling outage. bounds an analyzed steam generator Date of application for amendments: Date of issuance: May 5, 2006. tube plugging level of 42 percent per July 29, 2005. Effective date: As of the date of steam generator. Brief description of amendments: The issuance and shall be implemented Date of Issuance: May 16, 2006. amendments revised Technical prior to entering Mode 5 upon restart

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from the Unit 1 Cycle 7 (U1C7) and regulations in 10 CFR Chapter I, Accordingly, the amendments have Refueling Outage. which are set forth in the license been issued and made effective as Amendment No.: 61. amendment. indicated. Facility Operating License No. NPF– Because of exigent or emergency Unless otherwise indicated, the 90: Amendment revises the Technical circumstances associated with the date Commission has determined that these Specifications. the amendment was needed, there was amendments satisfy the criteria for Date of initial notice in Federal not time for the Commission to publish, categorical exclusion in accordance Register: February 14, 2006 (71 FR for public comment before issuance, its with 10 CFR 51.22. Therefore, pursuant 7814). usual Notice of Consideration of to 10 CFR 51.22(b), no environmental The Commission’s related evaluation Issuance of Amendment, Proposed No impact statement or environmental of the amendment is contained in a Significant Hazards Consideration assessment need be prepared for these Safety Evaluation dated May 5, 2006. Determination, and Opportunity for a amendments. If the Commission has No significant hazards consideration Hearing. prepared an environmental assessment comments received: No. For exigent circumstances, the under the special circumstances Commission has either issued a Federal provision in 10 CFR 51.12(b) and has Virginia Electric and Power Company, et Register notice providing opportunity made a determination based on that al., Docket Nos. 50–280 and 50–281, for public comment or has used local assessment, it is so indicated. Surry Power Station, Units 1 and 2, media to provide notice to the public in For further details with respect to the Surry County, Virginia the area surrounding a licensee’s facility action see (1) the application for Date of application for amendments: of the licensee’s application and of the amendment, (2) the amendment to March 8, 2005. Commission’s proposed determination Facility Operating License, and (3) the Brief description of amendments: of no significant hazards consideration. Commission’s related letter, Safety These amendments revised the auxiliary The Commission has provided a Evaluation and/or Environmental feedwater (AFW) requirements of reasonable opportunity for the public to Assessment, as indicated. All of these Technical Specifications (TSs) 3.6, comment, using its best efforts to make items are available for public inspection ‘‘Turbine Cycle,’’ and 4.8, ‘‘Auxiliary available to the public means of at the Commission’s Public Document Feedwater System,’’ to eliminate the communication for the public to Room (PDR), located at One White Flint inconsistency between the AFW pump respond quickly, and in the case of North, Public File Area 01F21, 11555 requirements and the required actions, telephone comments, the comments Rockville Pike (first floor), Rockville, establish consistency with the Improved have been recorded or transcribed as Maryland. Publicly available records TSs, and add an AFW flowpath allowed appropriate and the licensee has been will be accessible from the Agencywide outage time along with required actions. informed of the public comments. Documents Access and Management Date of issuance: February 23, 2006. In circumstances where failure to act System’s (ADAMS) Public Electronic Effective date: As of the date of in a timely way would have resulted, for Reading Room on the Internet at the issuance and shall be implemented example, in derating or shutdown of a NRC Web site, http://www.nrc.gov/ within 60 days. nuclear power plant or in prevention of reading-rm/adams.html. If you do not Amendment Nos.: 246 and 245. either resumption of operation or of have access to ADAMS or if there are Renewed Facility Operating License increase in power output up to the problems in accessing the documents Nos. DPR–32 and DPR–37: Amendments plant’s licensed power level, the located in ADAMS, contact the PDR change the Technical Specifications. Commission may not have had an Reference staff at 1 (800) 397–4209, Date of initial notice in Federal opportunity to provide for public (301) 415–4737 or by e-mail to Register: April 26, 2005 (70 FR 21465). comment on its no significant hazards [email protected]. The Commission’s related evaluation consideration determination. In such The Commission is also offering an of the amendments is contained in a case, the license amendment has been opportunity for a hearing with respect to Safety Evaluation dated February 23, issued without opportunity for the issuance of the amendment. Within 2006. comment. If there has been some time 60 days after the date of publication of No significant hazards consideration for public comment but less than 30 this notice, the licensee may file a comments received: No. days, the Commission may provide an request for a hearing with respect to opportunity for public comment. If issuance of the amendment to the Notice of Issuance of Amendments to comments have been requested, it is so subject facility operating license and Facility Operating Licenses and Final stated. In either event, the State has any person whose interest may be Determination of No Significant been consulted by telephone whenever affected by this proceeding and who Hazards Consideration and possible. wishes to participate as a party in the Opportunity for a Hearing (Exigent Under its regulations, the Commission proceeding must file a written request Public Announcement or Emergency may issue and make an amendment for a hearing and a petition for leave to Circumstances) immediately effective, notwithstanding intervene. Requests for a hearing and a During the period since publication of the pendency before it of a request for petition for leave to intervene shall be the last biweekly notice, the a hearing from any person, in advance filed in accordance with the Commission has issued the following of the holding and completion of any Commission’s ‘‘Rules of Practice for amendments. The Commission has required hearing, where it has Domestic Licensing Proceedings’’ in 10 determined for each of these determined that no significant hazards CFR part 2. Interested persons should amendments that the application for the consideration is involved. consult a current copy of 10 CFR 2.309, amendment complies with the The Commission has applied the which is available at the Commission’s standards and requirements of the standards of 10 CFR 50.92 and has made PDR, located at One White Flint North, Atomic Energy Act of 1954, as amended a final determination that the Public File Area 01F21, 11555 Rockville (the Act), and the Commission’s rules amendment involves no significant Pike (first floor), Rockville, Maryland, and regulations. The Commission has hazards consideration. The basis for this and electronically on the Internet at the made appropriate findings as required determination is contained in the NRC Web site, http://www.nrc.gov/ by the Act and the Commission’s rules documents related to this action. reading-rm/doc-collections/cfr/. If there

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are problems in accessing the document, within the scope of the amendment addressed to the Office of the Secretary, contact the PDR Reference staff at 1 under consideration. The contention U.S. Nuclear Regulatory Commission, (800) 397–4209, (301) 415–4737, or by e- must be one which, if proven, would [email protected]; or (4) facsimile mail to [email protected]. If a request for a entitle the petitioner to relief. A transmission addressed to the Office of hearing or petition for leave to intervene petitioner/requestor who fails to satisfy the Secretary, U.S. Nuclear Regulatory is filed by the above date, the these requirements with respect to at Commission, Washington, DC, Commission or a presiding officer least one contention will not be Attention: Rulemakings and designated by the Commission or by the permitted to participate as a party. Adjudications Staff at (301) 415–1101, Chief Administrative Judge of the Each contention shall be given a verification number is (301) 415–1966. Atomic Safety and Licensing Board separate numeric or alpha designation A copy of the request for hearing and Panel, will rule on the request and/or within one of the following groups: petition for leave to intervene should petition; and the Secretary or the Chief 1. Technical—primarily concerns/ also be sent to the Office of the General Administrative Judge of the Atomic issues relating to technical and/or Counsel, U.S. Nuclear Regulatory Safety and Licensing Board will issue a health and safety matters discussed or Commission, Washington, DC 20555– notice of a hearing or an appropriate referenced in the applications. 0001, and it is requested that copies be order. 2. Environmental—primarily transmitted either by means of facsimile As required by 10 CFR 2.309, a concerns/issues relating to matters transmission to (301) 415–3725 or by e- petition for leave to intervene shall set discussed or referenced in the mail to [email protected]. A copy forth with particularity the interest of environmental analysis for the of the request for hearing and petition the petitioner in the proceeding, and applications. for leave to intervene should also be 3. Miscellaneous—does not fall into how that interest may be affected by the sent to the attorney for the licensee. results of the proceeding. The petition one of the categories outlined above. Nontimely requests and/or petitions As specified in 10 CFR 2.309, if two should specifically explain the reasons and contentions will not be entertained or more petitioners/requestors seek to why intervention should be permitted absent a determination by the co-sponsor a contention, the petitioners/ with particular reference to the Commission or the presiding officer or requestors shall jointly designate a following general requirements: (1) The the Atomic Safety and Licensing Board representative who shall have the name, address, and telephone number of that the petition, request and/or the authority to act for the petitioners/ the requestor or petitioner; (2) the contentions should be granted based on nature of the requestor’s/petitioner’s requestors with respect to that contention. If a petitioner/requestor a balancing of the factors specified in 10 right under the Act to be made a party CFR 2.309(a)(1)(i)–(viii). to the proceeding; (3) the nature and seeks to adopt the contention of another extent of the requestor’s/petitioner’s sponsoring petitioner/requestor, the Southern California Edison Company, et property, financial, or other interest in petitioner/requestor who seeks to adopt al., Docket No. 50–362, San Onofre the proceeding; and (4) the possible the contention must either agree that the Nuclear Generating Station, Unit 3, San effect of any decision or order which sponsoring petitioner/requestor shall act Diego County, California may be entered in the proceeding on the as the representative with respect to that Date of amendment request: May 4, requestor’s/petitioner’s interest. The contention, or jointly designate with the 2006. petition must also identify the specific sponsoring petitioner/requestor a Description of amendment request: contentions which the petitioner/ representative who shall have the Allowed repairing a line in the requestor seeks to have litigated at the authority to act for the petitioners/ shutdown cooling (SDC) system with proceeding. requestors with respect to that the unit in Mode 4. This repair plan Each contention must consist of a contention. caused Unit 3 to be out of compliance specific statement of the issue of law or Those permitted to intervene become with the licensing basis of the SDC fact to be raised or controverted. In parties to the proceeding, subject to any system for the limited duration of the addition, the petitioner/requestor shall limitations in the order granting leave to repair, but not to exceed 7 days. provide a brief explanation of the bases intervene, and have the opportunity to Date of issuance: May 5, 2006. for the contention and a concise participate fully in the conduct of the Effective date: Immediate. statement of the alleged facts or expert hearing. Since the Commission has Amendment No.: 194. opinion which support the contention made a final determination that the Facility Operating License No. (NPF– and on which the petitioner intends to amendment involves no significant 15): Amendment revised the Updated rely in proving the contention at the hazards consideration, if a hearing is Final Safety Analysis Report, Section hearing. The petitioner must also requested, it will not stay the 5.4.7.1.2.C. with a note that states that provide references to those specific effectiveness of the amendment. Any the change is only applicable from the sources and documents of which the hearing held would take place while the date of issuance of the amendment until petitioner is aware and on which the amendment is in effect. the repair is completed on the SDC line petitioner intends to rely to establish A request for a hearing or a petition or 7 days, whichever occurs first. those facts or expert opinion. The for leave to intervene must be filed by: Public comments requested as to petition must include sufficient (1) First class mail addressed to the proposed no significant hazards information to show that a genuine Office of the Secretary of the consideration (NSHC): No. The dispute exists with the applicant on a Commission, U.S. Nuclear Regulatory Commission’s related evaluation of the material issue of law or fact.1 Commission, Washington, DC 20555– amendment, finding of emergency Contentions shall be limited to matters 0001, Attention: Rulemaking and circumstances, state consultation, and Adjudications Staff; (2) courier, express final NSHC determination are contained 1 To the extent that the applications contain mail, and expedited delivery services: in a safety evaluation dated May 5, attachments and supporting documents that are not Office of the Secretary, Sixteenth Floor, 2006. publicly available because they are asserted to One White Flint North, 11555 Rockville Attorney for licensee: Douglas K. contain safeguards or proprietary information, petitioners desiring access to this information Pike, Rockville, Maryland 20852, Porter, Esquire, Southern California should contact the applicant or applicant’s counsel Attention: Rulemaking and Edison Company, 2244 Walnut Grove and discuss the need for a protective order. Adjudications Staff; (3) E-mail Avenue, Rosemead, California 91770.

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NRC Branch Chief: David Terao. Section 50.48(c), which the NRC acceptance thresholds for changes that Dated at Rockville, Maryland, this 25th day adopted in 2004 (69 FR 33536, June 16, may be made without prior NRC review of May 2006. 2004), incorporates NFPA 805 by and approval. In addition, this new For the Nuclear Regulatory Commission. reference, with certain exceptions, and guide includes guidance for the fire allows licensees to voluntarily adopt probabilistic safety analyses that Catherine Haney, and maintain a fire protection program licensees use to risk-inform the fire Director, Division of Operating Reactor that meets the requirements of NFPA protection program. Licensing, Office of Nuclear Reactor 805 as an alternative to meeting the The NRC staff encourages and Regulation. requirements of 10 CFR 50.48(b) or the welcomes comments and suggestions in [FR Doc. E6–8450 Filed 6–5–06; 8:45 am] plant-specific fire protection license connection with improvements to BILLING CODE 7590–01–P conditions. Licensees who choose to published regulatory guides, as well as comply with 10 CFR 50.48(c) must items for inclusion in regulatory guides that are currently being developed. You NUCLEAR REGULATORY submit a license amendment application may submit comments by any of the COMMISSION to the NRC, in accordance with 10 CFR 50.90. Section 50.48(c)(3) describes the following methods. Regulatory Guide: Issuance, required content of the application. Mail comments to: Rules and Availability The Nuclear Energy Institute (NEI) Directives Branch, Office of has developed NEI 04–02, ‘‘Guidance Administration, U.S. Nuclear Regulatory The U.S. Nuclear Regulatory for Implementing a Risk-Informed, Commission, Washington, DC 20555– Commission (NRC) has issued a new Performance-Based Fire Protection 0001. guide in the agency’s Regulatory Guide Program Under 10 CFR 50.48(c),’’ Hand-deliver comments to: Rules and Series. This series has been developed Revision 1, dated September 2005, to Directives Branch, Office of to describe and make available to the assist licensees in adopting 10 CFR Administration, U.S. Nuclear Regulatory public such information as methods that 50.48(c) and making the transition from Commission, 11555 Rockville Pike, are acceptable to the NRC staff for their current fire protection program Rockville, Maryland 20852, between implementing specific parts of the (FPP) to one based on NFPA 805. This 7:30 a.m. and 4:15 p.m. on Federal NRC’s regulations, techniques that the regulatory guide endorses NEI 04–02, workdays. staff uses in evaluating specific Revision 1, because it provides methods Fax comments to: Rules and problems or postulated accidents, and acceptable to the NRC for implementing Directives Branch, Office of data that the staff needs in its review of NFPA 805 and complying with 10 CFR Administration, U.S. Nuclear Regulatory applications for permits and licenses. 50.48(c), subject to the additional Commission, at (301) 415–5144. Regulatory Guide 1.205, ‘‘Risk- regulatory positions contained in Requests for technical information Informed, Performance-Based Fire Section C of this regulatory guide and about Regulatory Guide 1.205 may be Protection for Existing Light-Water the approval authority that 10 CFR directed to Paul W. Lain at (301) 415– Nuclear Power Plants,’’ provides 50.48(c) grants to the authority having 2346 or via e-mail to [email protected]. guidance for use in complying with the jurisdiction (AHJ). The regulatory Regulatory guides are available for requirements that the NRC has positions in Section C include inspection or downloading through the promulgated for risk-informed, clarification of the guidance provided in NRC’s public Web site in the Regulatory performance-based fire protection NEI 04–02, as well as any NRC Guides document collection of the programs that meet the requirements of exceptions to the guidance. The NRC’s Electronic Reading Room at Title 10, § 50.48(c), of the Code of regulatory positions in Section C take http://www.nrc.gov/reading-rm/doc- Federal Regulations (10 CFR 50.48(c)) precedence over the NEI 04–02 collections. Regulatory Guide 1.205 is and the referenced 2001 Edition of the guidance. also available electronically in the National Fire Protection Association All references to NEI 04–02 in this NRC’s Agencywide Documents Access (NFPA) standard, NFPA 805, regulatory guide refer to Revision 1 of and Management System (ADAMS) at ‘‘Performance-Based Standard for Fire NEI 04–02. All references to NFPA 805 http://www.nrc.gov/reading-rm/ Protection for Light-Water Reactor in this regulatory guide refer to the 2001 adams.html, under Accession Electric Generating Plants.’’ Edition of NFPA. #ML061100174. In accordance with 10 CFR 50.48(a), The NRC previously solicited public In addition, regulatory guides are each operating nuclear power plant comment on this new guide by available for inspection at the NRC’s must have a fire protection plan that publishing a Federal Register notice (69 Public Document Room (PDR), which is satisfies General Design Criterion (GDC) FR 60192) concerning Draft Regulatory located at 11555 Rockville Pike, 3, ‘‘Fire Protection,’’ of Appendix A, Guide DG–1139 on October 7, 2004. Rockville, Maryland; the PDR’s mailing ‘‘General Design Criteria for Nuclear Following the closure of the public address is USNRC PDR, Washington, DC Power Plants,’’ to 10 CFR part 50, comment period on December 15, 2004, 20555–0001. The PDR can also be ‘‘Domestic Licensing of Production and the staff considered all stakeholder reached by telephone at (301) 415–4737 Utilization Facilities.’’ In addition, comments in the course of preparing or (800) 397–4205, by fax at (301) 415– plants that were licensed to operate Regulatory Guide 1.205. The NRC staff’s 3548, and by e-mail to [email protected]. before January 1, 1979, must meet the responses to public comments received Requests for single copies of draft or requirements of 10 CFR part 50, on the draft regulatory guide are final guides (which may be reproduced) Appendix R, ‘‘Fire Protection Program available electronically in the NRC’s or for placement on an automatic for Nuclear Power Facilities Operating Agencywide Documents Access and distribution list for single copies of Prior to January 1, 1979,’’ except to the Management System (ADAMS) at future draft guides in specific divisions extent provided for in 10 CFR 50.48(b). http://www.nrc.gov/reading-rm/ should be made in writing to the U.S. Plants licensed to operate after January adams.html, under Accession Nuclear Regulatory Commission, 1, 1979, are required to comply with 10 #ML061100235. In particular, the Washington, DC 20555–0001, Attention: CFR 50.48(a), as well as any plant- revisions in this new guide include Reproduction and Distribution Services specific fire protection license condition additional guidance regarding the plant Section; by e-mail to and technical specifications. change process, including risk [email protected]; or by fax to

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(301) 415–2289. Telephone requests Guide 1.193, as provided in 10 CFR NRC’s Electronic Reading Room at cannot be accommodated. 50.55a(a)(3), which permits the use of http://www.nrc.gov/reading-rm/doc- Regulatory guides are not alternatives to the Code requirements collections/. Electronic copies are also copyrighted, and Commission approval referenced in 10 CFR 50.55a, provided available in the NRC’s Agencywide is not required to reproduce them. that the proposed alternatives result in Documents Access and Management (5 U.S.C. 552(a)) an acceptable level of quality and safety. System (ADAMS) at http:// To do so, a licensee must submit a www.nrc.gov/reading-rm/adams.html, Dated at Rockville, Maryland, this 26th day of May, 2006. plant-specific request that addresses the under Accession #ML061210425. NRC’s concern about the given Code In addition, regulatory guides are For the U.S. Nuclear Regulatory Commission, Case. available for inspection at the NRC’s The NRC staff is soliciting comments Brian W. Sheron, Public Document Room (PDR), which is on Draft Regulatory Guide DG–1135, located at 11555 Rockville Pike, Director, Office of Nuclear Regulatory and comments may be accompanied by Research. Rockville, Maryland; the PDR’s mailing relevant information or supporting data. address is USNRC PDR, Washington, DC [FR Doc. E6–8706 Filed 6–5–06; 8:45 am] Please mention DG–1135 in the subject 20555–0001. The PDR can also be BILLING CODE 7590–01–P line of your comments. Comments on reached by telephone at (301) 415–4737 this draft regulatory guide submitted in or (800) 397–4205, by fax at (301) 415– writing or in electronic form will be NUCLEAR REGULATORY 3548, and by e-mail to [email protected]. made available to the public in their COMMISSION Requests for single copies of draft or entirety through the NRC’s Agencywide final guides (which may be reproduced) Draft Regulatory Guide: Issuance, Documents Access and Management or for placement on an automatic Availability System (ADAMS). Personal information distribution list for single copies of will not be removed from your future draft guides in specific divisions The U.S. Nuclear Regulatory comments. You may submit comments should be made in writing to the U.S. Commission (NRC) has issued for public by any of the following methods. Nuclear Regulatory Commission, comment a draft of a revised guide in Mail comments to: Rules and Washington, DC 20555–0001, Attention: the agency’s Regulatory Guide Series. Directives Branch, Office of Reproduction and Distribution Services This series has been developed to Administration, U.S. Nuclear Regulatory Section; by e-mail to describe and make available to the Commission, Washington, DC 20555– [email protected]; or by fax to public such information as methods that 0001. (301) 415–2289. Telephone requests are acceptable to the NRC staff for E-mail comments to: cannot be accommodated. implementing specific parts of the [email protected]. You may also submit Regulatory guides are not NRC’s regulations, techniques that the comments via the NRC’s rulemaking copyrighted, and Commission approval staff uses in evaluating specific Web site at http://ruleforum.llnl.gov. is not required to reproduce them. problems or postulated accidents, and Address questions about our rulemaking (5 U.S.C. 552(a)) data that the staff needs in its review of Web site to Carol A. Gallagher (301) applications for permits and licenses. 415–5905; e-mail [email protected]. Dated at Rockville, Maryland, this 19th day The draft Revision 2 of Regulatory Hand-deliver comments to: Rules and of May, 2006. Guide 1.193, ‘‘ASME Code Cases Not Directives Branch, Office of For the U.S. Nuclear Regulatory Approved for Use,’’ is temporarily Administration, U.S. Nuclear Regulatory Commission, identified by its task number, DG–1135, Commission, 11555 Rockville Pike, James T. Wiggins, which should be mentioned in all Rockville, Maryland 20852, between Deputy Director, Office of Nuclear Regulatory related correspondence. Like its 7:30 a.m. and 4:15 p.m. on Federal Research. predecessors, this proposed revision workdays. [FR Doc. E6–8709 Filed 6–5–06; 8:45 am] lists the Code Cases that the NRC has Fax comments to: Rules and BILLING CODE 7590–01–P determined are not acceptable for Directives Branch, Office of generic use as specified in Section III, Administration, U.S. Nuclear Regulatory ‘‘Rules for Construction of Nuclear Commission at (301) 415–5144. OFFICE OF PERSONNEL Power Plant Components,’’ and Section Requests for technical information MANAGEMENT XI, ‘‘Rules for Inservice Inspection of about Draft Regulatory Guide DG–1135 Nuclear Power Plant Components,’’ of may be directed to Wallace E. Norris, at Excepted Service the Boiler and Pressure Vessel (BPV) (301) 415–6796 or [email protected]. Code promulgated by the American Comments would be most helpful if ACTION: Notice. Society of Mechanical Engineers received by July 14, 2006. Comments SUMMARY: (ASME). (In so doing, this guide received after that date will be This gives notice of OPM complements Revision 34 of Regulatory considered if it is practical to do so, but decisions granting authority to make Guide 1.84, ‘‘Design, Fabrication, and the NRC is able to ensure consideration appointments under Schedules A, B, Materials Code Case Acceptability, only for comments received on or before and C in the excepted service as ASME Section III,’’ and Revision 15 of this date. Although a time limit is given, required by 5 CFR 6.6 and 213.103. Regulatory Guide 1.147, ‘‘Inservice comments and suggestions in FOR FURTHER INFORMATION CONTACT: Inspection Code Case Acceptability, connection with items for inclusion in David Guilford, Center for Leadership ASME Section XI, Division 1,’’ which guides currently being developed or and Executive Resources Policy, list the Code Cases that the NRC has improvements in all published guides Strategic Human Resources Policy determined to be acceptable alternatives are encouraged at any time. Division, 202–606–1391. to applicable provisions of Section III Electronic copies of the draft SUPPLEMENTARY INFORMATION: Appearing and Section XI, respectively.) regulatory guide are available through in the listing below are the individual Licensees may request NRC approval the NRC’s public Web site under Draft authorities established under Schedules to implement one or more of the Code Regulatory Guides in the Regulatory A, B, and C between April 1, 2006, and Cases listed in Revision 2 of Regulatory Guides document collection of the April 30, 2006. Future notices will be

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published on the fourth Tuesday of each Bureau of Democracy, Human Rights DMGS00495 Assistant Director to the month, or as soon as possible thereafter. and Labor. Effective April 25, 2006. Assistant Secretary for Legislative A consolidated listing of all authorities DSGS61084 Staff Assistant to the Affairs. Effective April 05, 2006. as of June 30 is published each year. Director, Policy Planning Staff. DMGS00501 Special Assistant to the Effective April 27, 2006. Schedule A Chief of Staff. Effective April 06, 2006. No Schedule A appointments were Section 213.335 Department of the Treasury DMGS00502 Confidential Assistant to approved for April 2006. the Deputy White House Liaison and DYGS00250 Director, Public Affairs to Schedule B Advisor to the Chief of Staff. Effective the Deputy Assistant Secretary for April 06, 2006. No Schedule B appointments were Public Affairs. Effective April 03, DMGS00505 Confidential Assistant to approved for April 2006. 2006. the Secretary of the Department of DYGS00469 Deputy Assistant Schedule C Homeland Security. Effective April 7, Secretary for Public Affairs to the 2006. The following Schedule C Assistant Secretary (Public Affairs). appointments were approved during Effective April 03, 2006. DMGS00488 Press Officer to the April 2006: DYGS60404 Senior Advisor to the Assistant Commissioner for Public Affairs. Effective April 13, 2006. Section 213.3303 Executive Office of Assistant Secretary (Financial Institutions). Effective April 27, 2006. DMGS00506 Policy Analyst to the the President Assistant Secretary for Private Sector. Office of Management and Budget Section 213.336 Office of the Secretary Effective April 14, 2006. of Defense BOGS00151 Deputy Press Secretary to DMGS00507 Special Assistant to the the Press Secretary. Effective April 18, DDGS16930 Defense Fellow to the Assistant Secretary for Policy. 2006. Special Assistant to the Secretary of Effective April 14, 2006. Defense for White House Liaison. DMGS00508 Public Affairs Specialist Office of National Drug Control Policy Effective April 10, 2006. to the Director of Communications, QQGS60089 Associate Director Office DGS16932 Defense Fellow to the Office of Domestic Preparedness. of Legislative Affairs to the Chief of Special Assistant to the Secretary of Effective April 14, 2006. Staff. Effective April 13, 2006. Defense for White House Liaison. DMGS00510 Policy Analyst to the Effective April 13, 2006. Assistant Secretary for International Section 213.333 Office of Science and DDGS16936 Special Assistant to the Affairs. Effective April 14, 2006. Technology Policy Principal Deputy Under Secretary of DMGS00511 Senior Advisor for TSGS60039 Assistant to the Director Defense (Comptroller) and Deputy Management to the Under Secretary for Legislative Affairs to the Chief of Under Secretary of Defense for Management. Effective April 14, Staff. Effective April 03, 2006. (Management Reform). Effective April 2006. 14, 2006. Section 213.334 Department of State DMGS00509 Legislative Assistant to DDGS16937 Foreign Affairs Specialist the Assistant Secretary for Legislative DSGS61070 Special Advisor to the to the Director, Administration and Affairs. Effective April 19, 2006. Assistant Secretary. Effective April Management. Effective April 14, 2006. DMGS00503 Director of Strategic 04, 2006. DDGS16942 Staff Assistant to the Communications to the Assistant DSGS61061 Protocol Officer (Gifts) to Deputy Assistant Secretary of Defense Secretary for Public Affairs. Effective the Chief of Protocol. Effective April (Negotiations Policy). Effective April April 24, 2006. 07, 2006. 19, 2006. DMGS00517 Executive Assistant to the DSGS61062 Foreign Affairs Officer DDGS16929 Assistant for Research, Chief of Staff. Effective April 26, (Visits) to the Chief of Protocol. Analysis and Special Projects to the 2006. Effective April 07, 2006. Special Assistant to the Secretary and DSGS61071 Public Affairs Specialist Deputy Secretary of Defense. Effective Section 213.3314 Department of to the Assistant Secretary for Public April 25, 2006. Commerce Affairs. Effective April 07, 2006. DSGS61073 Senior Advisor to the Section 213.3310 Department of DCGS00656 Confidential Assistant to Assistant Secretary for Population, Justice the Director of Advance. Effective Refugees and Migration. Effective DJGS00187 Counsel to the Assistant April 13, 2006. April 07, 2006. Attorney General, Civil Division. DCGS00558 Confidential Assistant to DSGS61074 Senior Advisor to the Effective April 07, 2006. the Director of Advance. Effective Assistant Secretary Bureau of DJGS00392 Policy Coordinator and April 14, 2006. International Narcotics and Law Special Assistant to the Director, DCGS00623 Public Affairs Specialist Enforcement Affairs. Effective April Executive Office for the United States to the Assistant Secretary for 07, 2006. Attorneys. Effective April 12, 2006. Manufacturing and Services. Effective DSGS61076 Special Assistant to the DJGS00390 Counsel to the Assistant April 28, 2006. Chief of Staff. Effective April 10, Attorney General (Legal Counsel). Section 213.3315 Department of Labor 2006. Effective April 17, 2006. DSGS61077 Special Assistant to the DLGS60089 Special Assistant to the Coordinator for Counter-Terrorism. Section 213.3311 Department of Director of Operations. Effective April Effective April 14, 2006. Homeland Security 6, 2006. DSGS61078 Senior Advisor to the DMGS00498 Advisor to the Director DLGS60045 Staff Assistant to the Assistant Secretary for Western for Intergovernmental. Effective April Special Assistant, Office of Public Hemispheric Affairs. Effective April 03, 2006. Affairs. Effective April 12, 2006. 18, 2006. DMGS00499 Confidential Assistant to DLGS60126 Special Assistant to the DSGS61081 Foreign Affairs Officer to the Chief of Staff. Effective April 03, Solicitor of Labor. Effective April 14, the Director, Assistant Secretary, 2006. 2006.

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DLGS60225 Staff Assistant to the Section 213.3327 Department of Section 213.3379 Commodity Futures Assistant Secretary for Public Affairs. Veterans Affairs Trading Commission Effective April 26, 2006. DVGS60011 Special Assistant to the CTGS00091 Chief Economist to the Section 213.3316 Department of Assistant Secretary for Public and Chairperson. Effective April 21, 2006. Health and Human Services Intergovernmental Affairs. Effective April 7, 2006. Section 213.3384 Department of DHGS60030 Special Assistant to the DVGS60036 Protocol Liaison Officer to Housing and Urban Development General Counsel. Effective April 7, the Secretary. Effective April 19, DUGS60410 Special Assistant to the 2006. 2006. General Counsel. Effective April 5, DHGS60006 Confidential Assistant to 2006. Section 213.3331 Department of the Assistant Secretary for Public DUGS60543 Staff Assistant to the Energy Affairs. Effective April 12, 2006. Director, Center for Faith Based and DHGS60032 Special Assistant to the DEGS005182 Legislative Advisor to Community Initiatives. Effective April Deputy Commissioner for Policy. the Assistant Secretary for 14, 2006. Effective April 12, 2006. Congressional and Intergovernmental DUGS60176 Staff Assistant to the DHGS60374 Confidential Assistant to Affairs. Effective April 21, 2006. Deputy Assistant Secretary for the Executive Secretary. Effective DEGS00515 Special Assistant to the Intergovernmental Affairs. Effective April 12, 2006. Assistant Secretary for Environment, April 26, 2006. DHGS60033 Special Assistant to the Safety and Health. Effective April 24, Assistant Secretary for Administration 2006. Section 213.3391 Office of Personnel and Management. Effective April 14, DEGS00519 Special Assistant to the Management 2006. Assistant Secretary for Congressional PMGS00059 Congressional Relations DHGS60035 Confidential Assistant to and Intergovernmental Affairs. Officer to the Director, Office of the Administrator Centers for Effective April 24, 2006. Congressional Relations. Medicare and Medicaid Services. DEGS00521 Special Assistant to the Effective April 21, 2006. White House Liaison. Effective April Section 213.3394 Department of DHGS60689 Director of Media Affairs 24, 2006. Transportation to the Director, Office of External DTGS60357 Special Assistant for Affairs. Effective April 21, 2006. Section 213.3332 Small Business Scheduling and Advance to the DHGS60007 Special Assistant to the Administration Director for Scheduling and Advance. Associate Commissioner for External SBGS00598 Special Assistant to the Effective April 10, 2006. Relations. Effective April 26, 2006. Associate Administrator for Strategic Section 213.3317 Department of Alliances. Effective April 12, 2006. Section 213.3396 National Education SBGS60112 Special Assistant to the Transportation Safety Board Deputy Administrator. Effective April DBGS00514 Special Assistant to the TBGS60107 Confidential Assistant to a 12, 2006. Member. Effective April 25, 2006. Director, Faith-Based and Community SBGS00597 Director of Scheduling to Initiatives Center. Effective April 3, the Chief of Staff and Chief Operating Authority: 5 U.S.C. 3301 and 3302; E.O. 2006. Officer. Effective April 14, 2006. 10577, 3 CFR 1954–1958 Comp., p. 218. DBGS00510 Special Assistant to the SBGS00599 Assistant Administrator Office of Personnel Management. Director, Intergovernmental Affairs. for Policy and Planning to the Dan G. Blair, Effective April 7, 2006. Associate Administrator for Policy. Deputy Director. DBGS00285 Special Assistant Effective April 28, 2006. (Education Attache to the United [FR Doc. E6–8720 Filed 6–5–06; 8:45 am] States Mission to the United Nations Section 213.3337 General Services BILLING CODE 6325–39–P Educational, Scientific and Cultural Administration Organization) to the Secretary. GSGS00174 Senior Advisor to the Effective April 18, 2006. Associate Administrator for SECURITIES AND EXCHANGE DBGS00519 Confidential Assistant to Congressional and Intergovernmental COMMISSION the Deputy Assistant Secretary for Affairs. Effective April 6, 2006. [Release No. 34–53903; File No. SR–ISE– Media Relations and Strategic GSGS00176 Senior Advisor to the 2005–49] Communications. Effective April 21, Associate Administrator for 2006. Congressional and Intergovernmental Self-Regulatory Organizations; DBGS00513 Special Assistant to the Affairs. Effective April 19, 2006. International Securities Exchange, Inc.; Assistant Secretary for Planning, Notice of Filing of Proposed Rule Section 213.3339 United States Evaluation, and Policy Development. Change and Amendment Nos. 1 and 2 International Trade Commission Effective April 24, 2006. Relating to Complex Order Execution TCGS60019 Staff Assistant (Legal) to a Section 213.3318 Environmental Commissioner. Effective April 12, May 31, 2006. Protection Agency 2006. Pursuant to Section 19(b)(1) of the EPGS06010 Senior Advance Specialist TCGS00013 Staff Assistant Securities Exchange Act of 1934 to the Deputy Chief of Staff (Economics) to the Vice Chairman. (‘‘Act’’),1 and Rule 19b–4 thereunder,2 (Operations). Effective April 20, 2006. Effective April 13, 2006. notice is hereby given that on October 4, 2005, the International Securities Section 213.3348 National Section 213.3325 United States Tax Exchange, Inc. (‘‘Exchange’’ or ‘‘ISE’’) Aeronautics and Space Administration Court filed with the Securities and Exchange JCGS60069 Trial Clerk to the Chief NNGS00170 Program Specialist to the Commission (‘‘Commission’’) the Judge. Effective April 7, 2006. Deputy Administrator, Office of JCGS60074 Trial Clerk to the Chief Program and Institutional Integration. 1 15 U.S.C. 78s(b)(1). Judge. Effective April 7, 2006. Effective April 25, 2006. 2 17 CFR 240.19b–4.

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proposed rule change as described in (a)(5)(i)(A) of this Rule, or SSF-option a Public Customer limit order, the price Items I, II, and III below, which Items order as defined in subparagraph of at least one leg of the complex order have been prepared by the ISE. The ISE (a)(5)(ii)(A) of this Rule, has priority must trade at a price that is better than filed Amendment Nos. 1 and 2 to the over bids and offers established in the the corresponding bid or offer in the proposal on February 1, 2006, and April marketplace by Non-Customer orders marketplace. While the Exchange 20, 2006, respectively.3 The and market maker quotes that are no proposes to allow the legs of complex Commission is publishing this notice to better than the price of the options leg, orders to be executed in penny solicit comments on the proposed rule but not over such bids and offers increments, it does not propose to change, as amended, from interested established by Public Customer Orders. change the existing requirement that to persons. The option legs of a stock-option order have priority over Public Customer limit I. Self-Regulatory Organization’s as defined in subparagraph (a)(5)(ii)(B), orders, at least one leg of the complex Statement of the Terms of Substance of or SSF-option order as defined in order must trade at a price that is better the Proposed Rule Change subparagraph (a)(5)(ii)(B), consisting of than the corresponding bid or offer in a combination order with stock or single the marketplace by at least one The Exchange is proposing to amend stock futures, as the case may be, may minimum trading increment.4 Thus, ISE Rule 722, ‘‘Complex Orders,’’ with be executed in accordance with the first Public Customer limit orders will respect to complex order execution. The sentence of this subparagraph (b)(2). maintain their existing priority under text of the proposed rule change is (3) through (5) no change. ISE Rule 722. below. Proposed new language is in * * * * * italics; proposed deletions are in 2. Statutory Basis [brackets]. II. Self-Regulatory Organization’s The Exchange believes that the basis * * * * * Statement of the Purpose of, and under the Act for this proposed rule Rule 722. Complex Orders. Statutory Basis for, the Proposed Rule change is found in Section 6(b)(5), in (a) no change. Change that the proposed rule change is (b) Applicability of Exchange Rules. In its filing with the Commission, the designed to promote just and equitable Except as otherwise provided in this Exchange included statements principles of trade, to remove 5 Rule, complex orders shall be subject to concerning the purpose of, and basis for, impediments to, and perfect the all other Exchange Rules that pertain to the proposed rule change and discussed mechanisms of, a free and open market orders generally. any comments it received on the and a national market system and, in (1) Minimum Increments. Bids and proposed rule change. The text of these general, to protect investors and the offers on complex orders may be statements may be examined at the public interest in that it will provide expressed in any decimal price, and the places specified in Item IV below. The investors with more flexibility in [option] leg(s) of a [stock-option] Exchange has prepared summaries, set pricing complex orders and increase the complex order may be executed in one forth in Sections A, B, and C below, of opportunity for complex orders to be cent increments, regardless of the the most significant aspects of such executed. minimum increments otherwise statements. applicable to the individual [options] B. Self-Regulatory Organization’s legs of the order. [Complex orders A. Self-Regulatory Organization’s Statement on Burden on Competition expressed in net price increments that Statement of the Purpose of, and The Exchange believes that the are not multiples of the minimum Statutory Basis for, the Proposed Rule proposed rule change does not impose increment are not entitled to the same Change any burden on competition that is not priority under subparagraph (b)(2) of 1. Purpose necessary or appropriate in furtherance this Rule as such orders expressed in of the purposes of the Act. increments that are multiples of the The Exchange proposes to allow the C. Self-Regulatory Organization’s minimum increment.] legs of an options-only complex order to (2) Complex Order Priority. be executed in penny increments. Statement on Comments on the Notwithstanding the provisions of Rule Currently under ISE Rule 722, the Proposed Rule Change Received From 713, a complex order, as defined in options leg of a stock-option order may Members, Participants or Others paragraph (a) of this Rule, may be be executed in penny increments, but The Exchange has not solicited, and executed at a total credit or debit price the legs of an options-only complex does not intend to solicit, comments on with one other Member without giving order must be executed at the standard this proposed rule change. The priority to bids or offers established in trading increments. The Exchange Exchange has not received any written the marketplace that are no better than proposes to allow the legs of all comments from members or other the bids or offers comprising such total complex orders to trade in penny interested parties. increments. The Exchange believes that credit or debit; provided, however, that III. Date of Effectiveness of the if any of the bids or offers established the proposed rule change will provide investors with flexibility in pricing the Proposed Rule Change and Timing for in the marketplace consist of a Public Commission Action Customer limit order, the price of at complex orders and create more least one leg of the complex order must opportunities for complex orders to Within 35 days of the date of trade at a price that is better than the receive an execution. publication of this notice in the Federal corresponding bid or offer in the Under ISE Rule 722, a complex order Register or within such longer period (i) marketplace by at least one minimum may be executed at a total credit or debit as the Commission may designate up to trading increment as defined in Rule price with one other Member without 90 days of such date if it finds such 710. Under the circumstances described giving priority to bids or offers above, the option leg of a stock-option established in the marketplace that are 4 A minimum trading increment is defined in ISE no better than the bids or offers Rule 710, ‘‘Minimum Trading Increments,’’ as $0.05 order, as defined in subparagraph if the options contract is trading at less than $3.00 comprising such total credit or debit, and $0.10 if the options contract is trading at or 3 Amendment No. 2 replaced the initial filing and provided that if any of the bids or offers above $3.00. Amendment No. 1 in their entirety. established in the marketplace consist of 5 15 U.S.C. 78f(b).

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longer period to be appropriate and For the Commission, by the Division of Release of Disciplinary Information publishes its reasons for so finding or Market Regulation, pursuant to delegated Through the Public Disclosure Program authority.6 (ii) as to which the Exchange consents, Rule 10.17(a) The Exchange shall, in J. Lynn Taylor, the Commission will: response to a request, release a copy of (A) By order approve such proposed Assistant Secretary. any identified disciplinary decision rule change, or [FR Doc. E6–8717 Filed 6–5–06; 8:45 am] issued by the Exchange or any (B) Institute proceedings to determine BILLING CODE 8010–01–P whether the proposed rule change Committee thereof; provided, however, should be disapproved. that each copy of: (1) A decision that is released prior to IV. Solicitation of Comments SECURITIES AND EXCHANGE the expiration of the time period COMMISSION Interested persons are invited to provided under NYSE Arca Rule 10.8 submit written data, views, and for appeal or while such an appeal is arguments concerning the foregoing, [Release No. 34–53879; File No. SR– pending shall be accompanied by a NYSEArca–2006–03] including whether the proposed rule statement that the findings and sanctions imposed in the decision may change, as amended, is consistent with Self-Regulatory Organizations; NYSE be increased, decreased, modified, or the Act. Comments may be submitted by Arca, Inc.; Notice of Filing and Order reversed by the Exchange; any of the following methods: Granting Accelerated Approval of (2) A final decision of the Exchange Proposed Rule Change and Electronic Comments that is released prior to the time period Amendment Nos. 1 and 2 Thereto To • Use the Commission’s Internet provided under the Securities Exchange Establish a Public Disclosure Program comment form (http://www.sec.gov/ Act of 1934 for appeal to the Securities rules/sro.shtml); or May 26, 2006. and Exchange Commission or while • Send an e-mail to rule- Pursuant to section 19(b)(1) of the such an appeal is pending shall be [email protected]. Please include File Securities Exchange Act of 1934 accompanied by a statement that the Number SR–ISE–2005–49 on the subject (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 findings and sanctions of the Exchange line. notice is hereby given that on April 6, are subject to review and modification by the Securities and Exchange Paper Comments 2006, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed with the Securities Commission; and • Send paper comments in triplicate and Exchange Commission (3) A final decision of the Exchange to Nancy M. Morris, Secretary, (‘‘Commission’’) the proposed rule that is released after the decision is Securities and Exchange Commission, change as described in Items I and II appealed to the Securities and 100 F Street, NE., Washington, DC below, which Items have been prepared Exchange Commission shall be 20549–1090. by the Exchange. On May 9, 2006, NYSE accompanied by a statement as to All submissions should refer to File Arca filed Amendment No. 1 to the whether the effectiveness of the Number SR–ISE–2005–49. This file proposed rule change. On May 17, 2006, sanctions has been stayed pending the number should be included on the NYSE Arca filed Amendment No. 2 to outcome of proceedings before the subject line if e-mail is used. To help the the proposed rule change. The Securities and Exchange Commission. Commission process and review your Commission is publishing this notice to (b)(1) The Exchange shall release to comments more efficiently, please use solicit comments on the proposed rule the public information with respect to only one method. The Commission will change, as amended, from interested any disciplinary decision issued post all comments on the Commission’s persons and is approving the proposal pursuant to NYSE Arca Rule 10 Internet Web site (http://www.sec.gov/ on an accelerated basis. imposing: (i) A suspension, cancellation rules/sro.shtml). Copies of the or expulsion upon an OTP Holder or submission, all subsequent I. Self-Regulatory Organization’s OTP Firm; or (ii) suspension or amendments, all written statements Statement of the Terms of Substance of revocation of the registration of an with respect to the proposed rule the Proposed Rule Change associated person of an OTP Holder or change that are filed with the NYSE Arca proposes to implement a OTP Firm; or (iii) suspension or barring Commission, and all written new rule, NYSE Arca Rule 10.17, that of an OTP Holder or OTP Firm or communications relating to the would institute and govern a program associated person from association with proposed rule change between the (‘‘Public Disclosure Program’’) in which all OTP Holders or OTP Firms; or (iv) Commission and any person, other than certain disciplinary actions involving imposition of monetary sanctions of those that may be withheld from the Option Trading Permit Holders (‘‘OTP $10,000 or more upon an OTP Holder or public in accordance with the Holders’’), Option Trading Permit Firms OTP Firm or associated person; or (v) provisions of 5 U.S.C. 552, will be (‘‘OTP Firms’’), and associated persons containing an allegation of a violation available for inspection and copying in thereof would be publicized. The text of of a Designated Rule; and may also the Commission’s Public Reference the proposed rule change is below. release to the public such information Room. Copies of the filing also will be Proposed new language is in italics. with respect to any disciplinary decision available for inspection and copying at or group of decisions that involve a the principal office of the ISE. All Rules of the NYSE Arca, Inc. significant policy or enforcement comments received will be posted * * * * * determination where the release of without change; the Commission does information is deemed by the President not edit personal identifying Rule 10 Disciplinary Proceedings and of the Exchange to be in the public information from submissions. You Appeals interest. The Exchange may, in its should submit only information that * * * * * discretion, determine to waive the you wish to make available publicly. All requirement to release information with submissions should refer to File 6 17 CFR 200.30–3(a)(12). respect to a disciplinary decision under Number SR–ISE–2005–49 and should be 1 15 U.S.C. 78s(b)(1). those extraordinary circumstances submitted on or before June 27, 2006. 2 17 CFR 240.19b–4. where the release of such information

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would violate fundamental notions of an OTP Holder or OTP Firm from being determined by the Exchange to be in the fairness or work as an injustice. The associated with all OTP Holders or OTP public interest. Exchange may release to the public Firms is appealed to the Securities and * * * * * information on any disciplinary or other Exchange Commission, notice thereof decision issued pursuant to NYSE Arca shall be given to all OTP Holders and II. Self-Regulatory Organization’s Rule 10 not specifically enumerated in OTP Firms and to the press as soon as Statement of the Purpose of, and this paragraph, regardless of sanctions possible after receipt by the Exchange of Statutory Basis for, the Proposed Rule imposed, so long as the names of the notice from the Securities and Exchange Change parties and other identifying Commission of such appeal and the In its filing with the Commission, information is redacted. Exchange’s notice shall state whether NYSE Arca included statements A ‘‘Designated Rule’’ means (i) SEC the effectiveness of the Exchange’s concerning the purpose of, and basis for, Rule 10b–5, (ii) NYSE Arca Rule 11.5, or decision has been stayed pending the the proposed rule change. The text of (iii) NYSE Arca Rule 11.2. outcome of proceedings before the these statements may be examined at (A) The Exchange shall release to the Securities and Exchange Commission. the places specified in Item III below, public, in unredacted form, information (e) In the event an appeal to the and is set forth in Sections A, B, and C with respect to any disciplinary decision below. issued pursuant to NYSE Arca Rule 10.8 Federal courts is filed from a decision that does not meet one or more of the by the Securities and Exchange A. Self-Regulatory Organization’s criteria in section (b)(1) for the release Commission in a case previously Statement of the Purpose of, and the of information to the public, provided appealed to it from a decision of the Statutory Basis for, the Proposed Rule that the underlying decision issued Exchange, involving the imposition of Change monetary sanctions of $10,000 or more pursuant to NYSE Arca Rule 10.7 meets 1. Purpose one or more of the criteria in section or a penalty of expulsion, revocation, (b)(1) for the release of information to suspension and/or barring of an OTP Under the proposed Public Disclosure the public, and information regarding Holder or OTP Firm from being Program, the Exchange would release to such decision has been released to the associated with all OTP Holders or OTP the public certain information public in unredacted form. Firms, notice thereof shall be given to concerning the disciplinary history of (B) In the event there is more than one the OTP Holders or OTP Firms as soon OTP Holders, OTP Firms, and respondent in a disciplinary decision as possible after receipt by the Exchange associated persons. The Exchange is issued pursuant to NYSE Arca Rule 10 of a formal notice of appeal. Such instituting such procedures in order to and sanctions imposed on one or more, notice shall include a statement whether provide investors with information but not all, of the respondents meets one the order of the Securities and Exchange regarding final disciplinary decisions or more of the criteria in section (b)(1) Commission has been stayed. related to such OTP Holders, OTP for the release of information to the (f) Any order issued by the Securities Firms, and associated persons. The public, the Exchange shall release to the and Exchange Commission of (i) primary purpose of the Public public, in unredacted form, information revocation or suspension of an OTP Disclosure Program is to help investors with respect to the respondent(s) who Holder’s or OTP Firm’s broker/dealer make informed choices about the meet such criteria, and may release to registration with the Securities and individuals and firms with whom they the public, in redacted form, Exchange Commission; or (ii) the may wish to do business. Currently, the information with respect to the suspension or expulsion of an OTP Exchange does not have rules related to respondent(s) who do not meet such Holder or OTP Firm from the Exchange; the release of disciplinary decisions to criteria. Notwithstanding the foregoing, or (iii) the suspension or barring of an members of the public. Proposed NYSE the Exchange shall release to the public, OTP Holder or OTP Firm or an Arca Rule 10.17 would allow the in unredacted form, information with associated person from association with Exchange to release such information respect to any respondent in a all broker/dealers or OTP Holders or upon request and when certain other disciplinary decision issued pursuant to OTP Firms; or (iv) the imposition of circumstances exist, as explained in NYSE Arca Rule 10.8 if the sanctions monetary sanctions of $10,000 or more greater detail below. imposed on such respondent in the shall be released to the public through Disciplinary Decisions. If a member of underlying decision issued pursuant to a notice containing the effective date the public requests a copy of an NYSE Arca Rule 10.7 meet one or more thereof sent as soon as possible after identified disciplinary decision issued of the criteria for release of information receipt by the Exchange of the order of by the Exchange or any committee to the public, and information with the Securities and Exchange thereof, a copy of the decision will be respect to that respondent has been Commission. provided to the requesting member of released in unredacted form. the public. The Exchange’s practice will (g) Cancellations of Option Trading (2) Information released to the public be to provide such information on a per- Permits or registration pursuant to the pursuant to subparagraph (b)(1) shall be OTP Holder, OTP Firm, or associated Exchange’s Rules and interpretative accompanied by a statement to the person basis. The Exchange will not material shall be released to the public extent required for that type of charge the public for this service. as soon after the effective date of the information under subparagraphs The Exchange will also release cancellation as possible. (a)(1)–(3). information to the public with respect to (c) Information regarding any (h) Releases to the public referred to disciplinary decisions that: (i) Impose a sanctions imposed pursuant to NYSE in paragraph (b) above shall identify the suspension, cancellation, or expulsion Arca Rule 10.6 shall be released to the Exchange Rule(s) or the SEC Rule(s) of an OTP Holder or OTP Firm; (ii) public pursuant to paragraph (b) violated, and shall describe the conduct impose the suspension or revocation of immediately upon such approval. constituting such violation. Releases the registration of an associated person (d) If a decision of the Exchange may also identify the OTP Holder or of an OTP Holder or OTP Firm; (iii) imposing monetary sanctions of $10,000 OTP Firm with which an individual was impose the suspension or barring of an or more or a penalty of expulsion, associated at the time the violations OTP Holder, OTP Firm, or associated revocation, suspension and/or barring of occurred if such identification is person from association with all OTP

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Holders or OTP Firms; (iv) impose (Review) or while an appeal is pending arbitrations. The Exchange’s intention is monetary sanctions of $10,000 or more must include a statement that the for public disclosure not to apply to upon an OTP Holder, OTP Firm, or findings and sanctions imposed in the disciplinary complaints that involve associated person; or (v) contain an decision may be increased, decreased, undecided issues or arbitrations allegation of a violation of a Designated modified, or reversed by the Exchange. between parties. The Exchange plans to Rule.3 The Exchange will release In addition, a final decision by the notify OTP Holders, OTP Firms, and unredacted information concerning Exchange that is released prior to the associated persons of the effectiveness decisions issued by the Board Appeals period in which a respondent may of this proposed rule change through the Committee that do not meet one or more appeal to the Commission or while such Exchange’s Internet Web site and a of the criteria in proposed NYSE Arca appeal is pending will include a regulatory bulletin. Rule 10.17(b)(1), provided that the statement that the findings and underlying decision meets one or more sanctions of the Exchange are subject to 2. Statutory Basis of the criteria in proposed NYSE Arca review and modification by the The Exchange believes that the Rule 10.17(b)(1), and the information Commission. Lastly, a final decision of proposed rule change is consistent with regarding the underlying decision was the Exchange that is released after the section 6(b) of the Act 4 in general, and released to the public in unredacted decision is appealed to the Commission furthers the objectives of section form. will include a statement as to whether 6(b)(5) 5 in particular, in that it is In the event that there is more than the effectiveness of the sanctions has designed to prevent fraudulent and one respondent in a disciplinary been stayed pending the outcome of manipulative acts and practices, to decision and sanctions are imposed on proceedings before the Commission. promote just and equitable principles of one or more of the respondents, but not Appeals. In the instance that the trade, to foster cooperation and all of the respondents meet one or more Exchange’s decisions are appealed to coordination with persons engaged in of the criteria in proposed NYSE Arca the Commission or the federal courts, regulating, clearing, settling, processing Rule 10.17(b)(1) for the release of the Exchange will notify all OTP information with respect to, and information, the Exchange will release Holders, OTP Firms, and the press. This facilitating transactions in securities, to to the public unredacted information includes all Exchange decisions remove impediments to and perfect the with respect to the respondents who imposing monetary sanctions of $10,000 mechanism of a free and open market meet such criteria. In addition, the or more or a penalty of expulsion, and a national market system, and, in Exchange may release redacted revocation, suspension, and/or barring general, to protect investors and the information to the public with respect to of an OTP Holder or OTP Firm from the respondents who do not meet the being associated with all OTP Holders public interest. criteria in proposed NYSE Arca Rule or OTP Firms. B. Self-Regulatory Organization’s 10.17(b)(1). Commission Orders. The Exchange Statement on Burden on Competition The Exchange may release will release through a notice to the information to the public concerning public information with respect to any The Exchange does not believe that disciplinary decisions that involve order issued by the Commission: (i) the proposed rule change will impose significant policy or enforcement Revoking or suspending an OTP Firm’s any burden on competition that is not determinations where the release of or OTP Holder’s broker-dealer necessary or appropriate in furtherance such information is deemed by the registration; (ii) suspending or expelling of the purposes of the Act. President of the Exchange to be in the an OTP Firm or OTP Holder from the C. Self-Regulatory Organization’s public interest. In addition, the Exchange; (iii) suspending or barring an Statement on Comments on the Exchange may exercise its discretion OTP Holder, OTP Firm, or an associated Proposed Rule Change Received From and waive the requirement to release person from associating with all broker- Members, Participants or Others information with respect to a dealers, OTP Holders, or OTP Firms; or disciplinary decision under (iv) imposing monetary sanctions of No written comments were solicited extraordinary circumstances where the $10,000 or more. or received with respect to the proposed release of the information would violate Offers of Settlement. The Exchange rule change. fundamental notions of fairness or work will release information regarding as an injustice. Finally, the Exchange sanctions imposed pursuant to NYSE III. Solicitation of Comments may release public information Arca Rule 10.6 (Offers of Settlement) Interested persons are invited to concerning any disciplinary or other upon the approval of offers of submit written data, views and decision issued pursuant to NYSE Arca settlement. arguments concerning the foregoing, Cancellation of Option Trading Rule 10 that is not specifically including whether the proposed rule Permits. In cases where the Exchange enumerated in proposed NYSE Arca change, as amended, is consistent with cancels an Options Trading Permit or Rule 10.17(b)(1), regardless of the the Act. Comments may be submitted by registration, the Exchange will notify sanctions imposed, so long as the names any of the following methods: of the parties and other identifying the public as soon after the effective information are redacted. date of the cancellation as possible. Electronic Comments Notices. Decisions that are released to While proposed NYSE Arca Rule • a member of the public must include 10.17 is based substantially on NASD Use the Commission’s Internet certain notices. Decisions that are Rule 8310 (Sanctions for Violation of comment form (http://www.sec.gov/ released prior to the period in which a the Rules) and IM–8310–2 (Release of rules/sro.shtml); or respondent may request an appeal Disciplinary and Other Information • Send an e-mail to rule- pursuant to NYSE Arca Rule 10.8 Through the Public Disclosure [email protected]. Please include File Program), it does not incorporate all Number SR–NYSEArca–2006–03 on the 3 A ‘‘Designated Rule’’ means (i) Commission aspects of such NASD Rule. For subject line. Rule 10b–5 under the Act, (ii) NYSE Arca Rule 11.5 example, proposed NYSE Arca Rule (Manipulation), or (iii) NYSE Arca Rule 11.2 (Prohibited Acts). See proposed NYSE Arca Rule 10.17 excludes public disclosure of 4 15 U.S.C. 78s(b). 10.17(b)(1). disciplinary complaints and 5 15 U.S.C. 78s(b)(5).

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Paper Comments general to protect investors and the For the Commission, by the Division of public interest. Market Regulation, pursuant to delegated • Send paper comments in triplicate The Commission believes that the authority.11 to Nancy M. Morris, Secretary, proposal to institute the Public Nancy M. Morris, Securities and Exchange Commission, Disclosure Program, which is Secretary. Station Place, 100 F Street, NE., substantially based on NASD Rule 8310 [FR Doc. E6–8700 Filed 6–5–06; 8:45 am] Washington, DC 20549–1090. 8 and IM–8310–2, serves the interest of BILLING CODE 8010–01–P All submissions should refer to File investor protection because it allows Number SR–NYSEArca–2006–03. This NYSE Arca members and the general public to promptly learn of final file number should be included on the SECURITIES AND EXCHANGE disciplinary decisions involving its subject line if e-mail is used. To help the COMMISSION broker-dealer members or associated Commission process and review your persons of such members. By notifying comments more efficiently, please use [Release No. 34–53878; File No. SR– the public of a final decision issued by only one method. The Commission will NYSEArca–2006–02] the Exchange or any committee of the post all comments on the Commission’s Exchange that results in the suspension, Internet Web site (http://www.sec.gov/ Self-Regulatory Organizations; NYSE cancellation, expulsion, and/or barring Arca, Inc.; Notice of Filing and Order rules/sro.shtml). Copies of the of an OTP Holder or OTP Firm or the submission, all subsequent Granting Accelerated Approval of imposition of monetary sanctions of Proposed Rule Change and amendments, all written statements $10,000 or more, for example, the with respect to the proposed rule Amendment Nos. 1 and 2 Thereto To Commission believes that the Public Establish a Public Disclosure Program change that are filed with the Disclosure Program should provide Commission, and all written important information to the public, May 26, 2006. communications relating to the create additional incentives for Pursuant to Section 19(b)(1) of the proposed rule change between the members of the Exchange to comply Commission and any person, other than Securities Exchange Act of 1934 with its rules, and help investors make 1 2 those that may be withheld from the (‘‘Act’’) and Rule 19b–4 thereunder, informed choices and decisions about notice is hereby given that on April 6, public in accordance with the the individuals and firms with whom 2006, NYSE Arca, Inc. (‘‘NYSE Arca’’ or provisions of 5 U.S.C. 552, will be they may wish to conduct business. As ‘‘Exchange’’), through its subsidiary, available for inspection and copying in such, the Commission finds that the NYSE Arca Equities, Inc. (‘‘NYSE Arca the Commission’s Public Reference proposed program promotes just and Equities’’), filed with the Securities and Room. Copies of such filing also will be equitable principles of trade, encourages Exchange Commission (‘‘Commission’’) available for inspection and copying at the prevention of fraudulent and the proposed rule change as described the principal office of the Exchange. All manipulative acts and practices, and in Items I and II below, which Items comments received will be posted seeks to perfect the mechanism of a free have been prepared by the Exchange. without change; the Commission does and open market. not edit personal identifying The Commission finds good cause for On May 9, 2006, NYSE Arca filed information from submissions. You approving this proposed rule change, as Amendment No. 1 to the proposed rule should submit only information that amended, before the thirtieth day after change. On May 17, 2006, NYSE Arca you wish to make available publicly. All the publication of notice thereof in the filed Amendment No. 2 to the proposed submissions should refer to File Federal Register. As noted earlier, rule change. The Commission is Number SR–NYSEArca–2006–03 and prompt disclosure of final disciplinary publishing this notice to solicit should be submitted on or before June decisions serves the interest of comments on the proposed rule change, 27, 2006. protecting investors and the general as amended, from interested persons public.9 Therefore, accelerating and is approving the proposal on an IV. Commission’s Findings and Order approval of the proposed rule change accelerated basis. Granting Accelerated Approval of should benefit investors because they Proposed Rule Change I. Self-Regulatory Organization’s will have access to the NYSE Arca Statement of the Terms of Substance of The Commission finds that the disciplinary information sooner. The the Proposed Rule Change proposed rule change, as amended, is Public Disclosure Program should foster consistent with the requirements of the compliance with NYSE Arca rules, NYSE Arca, through its subsidiary, Act and the rules and regulations heighten awareness of the public NYSE Arca Equities, proposes to investor with respect to the conduct of thereunder applicable to a national implement a new rule, NYSE Arca business on the Exchange, and, in securities exchange.6 In particular, the Equities Rule 10.15, that would institute general, improve the overall integrity of Commission finds that the proposed and govern a program (‘‘Public the market center. rule change is consistent with section Disclosure Program’’) in which certain 6(b)(5) of the Act,7 which requires that V. Conclusion disciplinary actions involving Equity Trading Permit Holders (‘‘ETP Holders’’) an exchange have rules designed, among It is therefore ordered, pursuant to other things, to promote just and and associated persons thereof would be section 19(b)(2) of the Act, that the publicized. The text of the proposed equitable principles of trade, to remove proposed rule change (SR–NYSEArca– impediments to and perfect the rule change is below. Proposed new 2006–03), as amended, is hereby language is in italics. mechanism of a free and open market approved on an accelerated basis.10 and a national market system, and in NYSE Arca Equities Rules 8 See Securities Exchange Act Release No. 35138 * * * * * 6 In approving this proposed rule change, the (December 22, 1994), 59 FR 67362 (December 29, Commission has considered the proposed rule’s 1994) (approving the NASD program to publish impact on efficiency, competition, and capital final disciplinary decisions involving its members). 11 17 CFR 200.30–3(a)(12). formation. See 15 U.S.C. 78c(f). 9 See id. 1 15 U.S.C. 78s(b)(1). 7 15 U.S.C. 78f(b)(5). 10 15 U.S.C. 78s(b)(2). 2 17 CFR 240.19b–4.

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RULE 10 DISCIPLINARY respect to a disciplinary decision under released to the public pursuant to PROCEEDINGS, OTHER HEARINGS, those extraordinary circumstances paragraph (b) immediately upon such AND APPEALS where the release of such information approval. (d) If a decision of the Corporation * * * * * would violate fundamental notions of fairness or work as an injustice. The imposing monetary sanctions of $10,000 Release of Disciplinary Information Corporation may release to the public or more or a penalty of expulsion, Through the Public Disclosure Program information on any disciplinary or other revocation, suspension and/or barring of Rule 10.15(a) The Corporation shall, decision issued pursuant to NYSE Arca an ETP Holder from being associated in response to a request, release a copy Equities Rule 10 not specifically with all ETP Holders is appealed to the of any identified disciplinary decision enumerated in this paragraph, Securities and Exchange Commission, notice thereof shall be given to all ETP issued by the Corporation or any regardless of sanctions imposed, so long Holders and to the press as soon as Committee thereof; provided, however, as the names of the parties and other possible after receipt by the Corporation that each copy of: identifying information is redacted. A ‘‘Designated Rule’’ means (i) SEC of notice from the Securities and (1) a decision that is released prior to Rule 10b–5, (ii) NYSE Arca Equities Exchange Commission of such appeal the expiration of the time period Rule 6.5, or (iii) NYSE Arca Equities and the Corporation’s notice shall state provided under NYSE Arca Equities Rule 6.2. whether the effectiveness of the Rule 10.8 for appeal or while such an (A) The Corporation shall release to Corporation’s decision has been stayed appeal is pending shall be accompanied the public, in unredacted form, pending the outcome of proceedings by a statement that the findings and information with respect to any before the Securities and Exchange sanctions imposed in the decision may disciplinary decision issued pursuant to Commission. be increased, decreased, modified, or NYSE Arca Equities Rule 10.8 that does (e) In the event an appeal to the reversed by the Corporation; not meet one or more of the criteria in federal courts is filed from a decision by (2) a final decision of the Corporation section (b)(1) for the release of the Securities and Exchange that is released prior to the time period information to the public, provided that Commission in a case previously provided under the Securities Exchange the underlying decision issued pursuant appealed to it from a decision of the Act of 1934 for appeal to the Securities to NYSE Arca Equities Rule 10.7 meets Corporation, involving the imposition of and Exchange Commission or while one or more of the criteria in section monetary sanctions of $10,000 or more such an appeal is pending shall be (b)(1) for the release of information to or a penalty of expulsion, revocation, accompanied by a statement that the the public, and information regarding suspension and/or barring of an ETP findings and sanctions of the such decision has been released to the Holder from being associated with all Corporation are subject to review and public in unredacted form. ETP Holders, notice thereof shall be modification by the Securities and (B) In the event there is more than one given to the ETP Holders as soon as Exchange Commission; and respondent in a disciplinary decision possible after receipt by the Corporation (3) a final decision of the Corporation issued pursuant to NYSE Arca Equities of a formal notice of appeal. Such that is released after the decision is Rule 10 and sanctions imposed on one notice shall include a statement whether appealed to the Securities and or more, but not all, of the respondents the order of the Securities and Exchange Exchange Commission shall be meets one or more of the criteria in Commission has been stayed. accompanied by a statement as to section (b)(1) for the release of (f) Any order issued by the Securities whether the effectiveness of the information to the public, the and Exchange Commission of (i) sanctions has been stayed pending the Corporation shall release to the public, revocation or suspension of an ETP outcome of proceedings before the in unredacted form, information with Holder’s broker/dealer registration with Securities and Exchange Commission. respect to the respondent(s) who meet the Securities and Exchange (b)(1) The Corporation shall release to such criteria, and may release to the Commission; or (ii) the suspension or the public information with respect to public, in redacted form, information expulsion of an ETP Holder from the any disciplinary decision issued with respect to the respondent(s) who do Corporation; or (iii) the suspension or pursuant to NYSE Arca Equities Rule 10 not meet such criteria. Notwithstanding barring of an ETP Holder or an imposing: (i) a suspension, cancellation the foregoing, the Corporation shall associated person from association with or expulsion upon an ETP Holder; or (ii) release to the public, in unredacted all broker/dealers or ETP Holders; or (iv) suspension or revocation of the form, information with respect to any the imposition of monetary sanctions of registration of an associated person of respondent in a disciplinary decision $10,000 or more shall be released to the an ETP Holder; or (iii) suspension or issued pursuant to NYSE Arca Equities public through a notice containing the barring of an ETP Holder or associated Rule 10.8 if the sanctions imposed on effective date thereof sent as soon as person from association with all ETP such respondent in the underlying possible after receipt by the Corporation Holders; or (iv) imposition of monetary decision issued pursuant to NYSE Arca of the order of the Securities and sanctions of $10,000 or more upon an Equities Rule 10.7 meet one or more of Exchange Commission. ETP Holder or associated person; or (v) the criteria for release of information to (g) Cancellations of Equity Trading containing an allegation of a violation the public, and information with respect Permits or registration pursuant to the of a Designated Rule; and may also to that respondent has been released in Corporation’s Rules and interpretative release to the public such information unredacted form. material shall be released to the public with respect to any disciplinary decision (2) Information released to the public as soon after the effective date of the or group of decisions that involve a pursuant to subparagraph (b)(1) shall be cancellation as possible. significant policy or enforcement accompanied by a statement to the (h) Releases to the public referred to determination where the release of extent required for that type of in paragraph (b) above shall identify the information is deemed by the President information under subparagraphs Corporation’s Rule(s) or the SEC Rule(s) of the Corporation to be in the public (a)(1)–(3). violated, and shall describe the conduct interest. The Corporation may, in its (c) Information regarding any constituting such violation. Releases discretion, determine to waive the sanctions imposed pursuant to NYSE may also identify the ETP Holder with requirement to release information with Arca Equities Rule 10.6 shall be which an individual was associated at

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the time the violations occurred if such or associated person from association respondent may request an appeal identification is determined by the with all ETP Holders; (iv) impose pursuant to NYSE Arca Equities Rule Corporation to be in the public interest. monetary sanctions of $10,000 or more 10.8 (Review) or while an appeal is * * * * * upon an ETP Holder or associated pending must include a statement that person; or (v) contain an allegation of a the findings and sanctions imposed in II. Self-Regulatory Organization’s violation of a Designated Rule.3 NYSE the decision may be increased, Statement of the Purpose of, and Arca Equities will release unredacted decreased, modified, or reversed by Statutory Basis for, the Proposed Rule information concerning decisions issued NYSE Arca Equities. In addition, a final Change by the Board Appeals Committee that do decision by NYSE Arca Equities that is In its filing with the Commission, not meet one or more of the criteria in released prior to the period in which a NYSE Arca included statements proposed NYSE Arca Equities Rule respondent may appeal to the concerning the purpose of, and basis for, 10.15(b)(1), provided that the Commission or while such appeal is the proposed rule change. The text of underlying decision meets one or more pending will include a statement that these statements may be examined at of the criteria in proposed NYSE Arca the findings and sanctions of NYSE the places specified in Item III below, Equities Rule 10.15(b)(1), and the Arca Equities are subject to review and and is set forth in Sections A, B, and C information regarding the underlying modification by the Commission. Lastly, below. decision was released to the public in a final decision of NYSE Arca Equities unredacted form. that is released after the decision is A. Self-Regulatory Organization’s In the event that there is more than appealed to the Commission will Statement of the Purpose of, and the one respondent in a disciplinary include a statement as to whether the Statutory Basis for, the Proposed Rule decision and sanctions are imposed on effectiveness of the sanctions has been Change one or more of the respondents, but not stayed pending the outcome of 1. Purpose all of the respondents meet one or more proceedings before the Commission. of the criteria in proposed NYSE Arca Appeals. In the instance that NYSE Under the proposed Public Disclosure Equities Rule 10.15(b)(1) for the release Arca Equities’ decisions are appealed to Program, NYSE Arca Equities would of information, NYSE Arca Equities will the Commission or the federal courts, release to the public certain information release to the public unredacted NYSE Arca Equities will notify all ETP concerning the disciplinary history of information with respect to the Holders and the press. This includes all ETP Holders and associated persons. respondents who meet such criteria. In NYSE Arca Equities decisions imposing NYSE Arca Equities is instituting such addition, NYSE Arca Equities may monetary sanctions of $10,000 or more procedures in order to provide investors release redacted information to the or a penalty of expulsion, revocation, with information regarding final public with respect to the respondents suspension, and/or barring of an ETP disciplinary decisions related to ETP who do not meet the criteria in Holder from being associated with all Holders and associated persons. The proposed NYSE Arca Equities Rule ETP Holders. primary purpose of the Public 10.15(b)(1). Commission Orders. NYSE Arca Disclosure Program is to help investors NYSE Arca Equities may release Equities will release through a notice to make informed choices about the information to the public concerning the public information with respect to individuals and firms with whom they disciplinary decisions that involve any order issued by the Commission: (i) may wish to do business. Currently, significant policy or enforcement Revoking or suspending an ETP NYSE Arca Equities does not have rules determinations where the release of Holder’s broker-dealer registration; (ii) related to the release of disciplinary such information is deemed by the suspending or expelling an ETP Holder decisions to members of the public. President of NYSE Arca Equities to be from NYSE Arca Equities; (iii) Proposed NYSE Arca Equities Rule in the public interest. In addition, NYSE suspending or barring an ETP Holder or 10.15 would allow NYSE Arca Equities Arca Equities may exercise its discretion an associated person from associating to release such information upon and waive the requirement to release with all broker-dealers or ETP Holders; request and when certain other information with respect to a or (iv) imposing monetary sanctions of circumstances exist, as explained in disciplinary decision under $10,000 or more. greater detail below. extraordinary circumstances where the Offers of Settlement. NYSE Arca Disciplinary Decisions. If a member of release of the information would violate Equities will release information the public requests a copy of an fundamental notions of fairness or work regarding sanctions imposed pursuant identified disciplinary decision issued as an injustice. Finally, NYSE Arca to NYSE Arca Equities Rule 10.6 (Offers by NYSE Arca Equities or any Equities may release public information of Settlement) upon the approval of committee thereof, a copy of the concerning any disciplinary or other offers of settlement. decision will be provided to the decision issued pursuant to NYSE Arca Cancellation of Equity Trading requesting member of the public. NYSE Equities Rule 10 that is not specifically Permits. In cases where NYSE Arca Arca Equities’ practice will be to enumerated in proposed NYSE Arca Equities cancels an Equity Trading provide such information on a per-ETP Equities Rule 10.15(b)(1), regardless of Permit or registration, NYSE Arca Holder or associated person basis. NYSE the sanctions imposed, so long as the Equities will notify the public as soon Arca Equities will not charge the public names of the parties and other after the effective date of the for this service. identifying information are redacted. cancellation as possible. NYSE Arca Equities will also release Notices. Decisions that are released to While proposed NYSE Arca Equities information to the public with respect to a member of the public must include Rule 10.15 is based substantially on disciplinary decisions that: (i) Impose a certain notices. Decisions that are NASD Rule 8310 (Sanctions for suspension, cancellation, or expulsion released prior to the period in which a Violation of the Rules) and IM–8310–2 of an ETP Holder; (ii) impose the (Release of Disciplinary and Other suspension or revocation of the 3 A ‘‘Designated Rule’’ means (i) Commission Information Through the Public registration of an associated person of Rule 10b–5 under the Act, (ii) NYSE Arca Equities Disclosure Program), it does not Rule 6.5 (Manipulation), or (iii) NYSE Arca Equities an ETP Holder; (iii) impose the Rule 6.2 (Prohibited Acts). See proposed NYSE incorporate all aspects of such NASD suspension or barring of an ETP Holder Arca Equities Rule 10.15(b)(1). Rule. For example, proposed NYSE Arca

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Equities Rule 10.15 excludes public Paper Comments general to protect investors and the disclosure of disciplinary complaints public interest. • Send paper comments in triplicate and arbitrations. NYSE Arca Equities’s The Commission believes that the intention is for public disclosure not to to Nancy M. Morris, Secretary, Securities and Exchange Commission, proposal to institute the Public apply to disciplinary complaints that Disclosure Program, which is involve undecided issues or arbitrations Station Place, 100 F Street, NE., Washington, DC 20549–1090. substantially based on NASD Rule 8310 between parties. NYSE Arca Equities and IM–8310–2,8 serves the interest of plans to notify ETP Holders and All submissions should refer to File investor protection because it allows associated persons of the effectiveness Number SR–NYSEArca–2006–02. This NYSE Arca Equities members and the of this proposed rule change through file number should be included on the general public to promptly learn of final NYSE Arca Equities’ Internet Web site subject line if e-mail is used. To help the disciplinary decisions involving its and a regulatory bulletin. Commission process and review your broker-dealer members or associated 2. Statutory Basis comments more efficiently, please use persons of such members. By notifying only one method. The Commission will The Exchange believes that the the public of a final decision issued by post all comments on the Commission’s proposed rule change is consistent with the Exchange or any committee of the Internet Web site (http://www.sec.gov/ Section 6(b) of the Act 4 in general, and Exchange that results in the suspension, rules/sro.shtml). Copies of the furthers the objectives of Section cancellation, expulsion, and/or barring submission, all subsequent 6(b)(5) 5 in particular, in that it is of an ETP Holder or the imposition of amendments, all written statements designed to prevent fraudulent and monetary sanctions of $10,000 or more, with respect to the proposed rule manipulative acts and practices, to for example, the Commission believes change that are filed with the promote just and equitable principles of that the Public Disclosure Program Commission, and all written trade, to foster cooperation and should provide important information coordination with persons engaged in communications relating to the to the public, create additional regulating, clearing, settling, processing proposed rule change between the incentives for members of the Exchange information with respect to, and Commission and any person, other than to comply with its rules, and help facilitating transactions in securities, to those that may be withheld from the investors make informed choices and remove impediments to and perfect the public in accordance with the decisions about the individuals and mechanism of a free and open market provisions of 5 U.S.C. 552, will be firms with whom they may wish to and a national market system, and, in available for inspection and copying in conduct business. As such, the general, to protect investors and the the Commission’s Public Reference Commission finds that the proposed public interest. Room. Copies of such filing also will be program promotes just and equitable available for inspection and copying at principles of trade, encourages the B. Self-Regulatory Organization’s the principal office of the Exchange. All prevention of fraudulent and Statement on Burden on Competition comments received will be posted manipulative acts and practices, and without change; the Commission does The Exchange does not believe that seeks to perfect the mechanism of a free not edit personal identifying the proposed rule change will impose and open market. any burden on competition that is not information from submissions. You The Commission finds good cause for necessary or appropriate in furtherance should submit only information that of the purposes of the Act. you wish to make available publicly. All approving this proposed rule change, as submissions should refer to File amended, before the thirtieth day after C. Self-Regulatory Organization’s Number SR–NYSEArca–2006–02 and the publication of notice thereof in the Statement on Comments on the should be submitted on or before June Federal Register. As noted earlier, Proposed Rule Change Received From 27, 2006. prompt disclosure of final disciplinary Members, Participants or Others decisions serves the interest of IV. Commission’s Findings and Order No written comments were solicited protecting investors and the general Granting Accelerated Approval of 9 or received with respect to the proposed public. Therefore, accelerating Proposed Rule Change rule change. approval of the proposed rule change should benefit investors because they III. Solicitation of Comments The Commission finds that the proposed rule change, as amended, is will have access to the NYSE Arca Interested persons are invited to consistent with the requirements of the Equities disciplinary information submit written data, views and Act and the rules and regulations sooner. The Public Disclosure Program arguments concerning the foregoing, thereunder applicable to a national should foster compliance with NYSE including whether the proposed rule securities exchange.6 In particular, the Arca Equities rules, heighten awareness change, as amended, is consistent with Commission finds that the proposed of the public investor with respect to the the Act. Comments may be submitted by rule change is consistent with Section conduct of business on the Exchange, any of the following methods: 6(b)(5) of the Act,7 which requires that and, in general, improve the overall integrity of the market center. Electronic Comments an exchange have rules designed, among • other things, to promote just and V. Conclusion Use the Commission’s Internet equitable principles of trade, to remove comment form (http://www.sec.gov/ impediments to and perfect the It is therefore ordered, pursuant to rules/sro.shtml); or mechanism of a free and open market Section 19(b)(2) of the Act, that the • Send an e-mail to rule- and a national market system, and in proposed rule change (SR–NYSEArca– [email protected]. Please include File Number SR–NYSEArca–2006–02 on the 6 In approving this proposed rule change, the 8 See Securities Exchange Act Release No. 35138 subject line. Commission has considered the proposed rule’s (December 22, 1994), 59 FR 67362 (December 29, impact on efficiency, competition, and capital 1994) (approving the NASD program to publish 4 15 U.S.C. 78s(b). formation. See 15 U.S.C. 78c(f). final disciplinary decisions involving its members). 5 15 U.S.C. 78s(b)(5). 7 15 U.S.C. 78f(b)(5). 9 See id.

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2006–02), as amended, is hereby Percent The following areas have been approved on an accelerated basis.10 determined to be adversely affected by For the Commission, by the Division of Homeowners with Credit Avail- the disaster: Market Regulation, pursuant to delegated able Elsewhere ...... 5.875 Primary Counties (Physical Damage and authority.11 Homeowners without Credit Economic Injury Loans): Available Elsewhere ...... 2.937 Nancy M. Morris, Essex, Middlesex, Suffolk. Businesses with Credit Avail- Contiguous Counties (Economic Injury Secretary. able Elsewhere ...... 7.763 [FR Doc. E6–8716 Filed 6–5–06; 8:45 am] Businesses and Non-Profit Or- Loans Only): Massachusetts: Norfolk, Worcester. BILLING CODE 8010–01–P ganizations without Credit Available Elsewhere ...... 4.000 New Hampshire: Hillsborough, Other (Including Non-Profit Or- Rockingham. ganizations) with Credit Avail- The Interest Rates are: SMALL BUSINESS ADMINISTRATION able Elsewhere ...... 5.000 [Disaster Declaration #10480 and #10479] For Economic Injury: Percent Businesses & Small Agricultural Maine Disaster #ME–00004 Cooperatives without Credit For Physical Damage: Available Elsewhere ...... 4.000 Homeowners with Credit Avail- AGENCY: U.S. Small Business able Elsewhere ...... 5.875 Administration. The number assigned to this disaster Homeowners without Credit ACTION: Notice. for physical damage is 104806 and for Available Elsewhere ...... 2.937 Businesses with Credit Avail- economic injury is 104790. SUMMARY: This is a Notice of the able Elsewhere ...... 7.763 Presidential declaration of a major (Catalog of Federal Domestic Assistance Businesses and Non-Profit Or- disaster for the State of Maine (FEMA– Numbers 59002 and 59008) ganizations without Credit 1644–DR), dated May 25, 2006. Available Elsewhere ...... 4.000 Herbert L. Mitchell, Other (Including Non-Profit Or- Incident: Severe Storms and Flooding. Associate Administrator for Disaster ganizations) with Credit Avail- Incident Period: May 13, 2006 and Assistance. able Elsewhere ...... 5.000 continuing. [FR Doc. E6–8693 Filed 6–5–06; 8:45 am] For Economic Injury: Effective Date: May 25, 2006. BILLING CODE 8025–01–P Businesses & Small Agricultural Physical Loan Application Deadline Cooperatives without Credit Date: July 24, 2006. Available Elsewhere ...... 4.000 Economic Injury (EIDL) Loan SMALL BUSINESS ADMINISTRATION Application Deadline Date: February 26, The number assigned to this disaster 2007. [Disaster Declaration #10482 and #10481] for physical damage is 104826 and for ADDRESSES: Submit completed loan economic injury is 104810. Massachusetts Disaster #MA–00006 applications to: U.S. Small Business (Catalog of Federal Domestic Assistance Administration, National Processing AGENCY: Small Business Administration. Numbers 59002 and 59008) and Disbursement Center, 14925 ACTION: Notice. Kingsport Road, Fort Worth, TX 76155. Herbert L. Mitchell, FOR FURTHER INFORMATION CONTACT: A. SUMMARY: This is a Notice of the Associate Administrator for Disaster Escobar, Office of Disaster Assistance, Presidential declaration of a major Assistance. U.S. Small Business Administration, disaster for the Commonwealth of [FR Doc. E6–8686 Filed 6–5–06; 8:45 am] 409 3rd Street, SW., Suite 6050, Masschusetts (FEMA–1642–DR), dated BILLING CODE 8025–01–P Washington, DC 20416. 05/25/2006. SUPPLEMENTARY INFORMATION: Notice is Incident: Severe Storms and Flooding. SMALL BUSINESS ADMINISTRATION hereby given that as a result of the Incident Period: 05/12/2006 and President’s major disaster declaration on continuing. [Disaster Declaration #10478 and #10477] May 25, 2006, applications for disaster Effective Date: 05/25/2006. loans may be filed at the address listed Physical Loan Application Deadline New Hampshire Disaster # NH–00002 Date: 07/24/2006. above or other locally announced AGENCY: Small Business Administration. locations. Economic Injury (EIDL) Loan The following areas have been Application Deadline Date: 02/26/2007. ACTION: Notice. determined to be adversely affected by ADDRESSES: Submit completed loan SUMMARY: This is a Notice of the the disaster: applications to: U.S. Small Business Presidential declaration of a major Primary Counties (Physical Damage and Administration, National Processing disaster for the State of New Hampshire Economic Injury Loans): and Disbursement Center, 14925 (FEMA–1643–DR), dated 05/25/2006. York. Kingsport Road, Fort Worth, TX 76155. Incident: Severe Storms and Flooding. Contiguous Counties (Economic Injury FOR FURTHER INFORMATION CONTACT: A. Incident Period: 05/12/2006 and Loans Only): Escobar, Office of Disaster Assistance, continuing. Maine, Cumberland, Oxford U.S. Small Business Administration, Effective Date: 05/25/2006. New Hampshire, Carroll, 409 3rd Street, SW., Suite 6050, Physical Loan Application Deadline Rockingham, and Strafford. Washington, DC 20416. Date: 07/24/2006. The Interest Rates are: SUPPLEMENTARY INFORMATION: Notice is Economic Injury (EIDL) Loan Application Deadline Date: 02/26/2007. Percent hereby given that as a result of the President’s major disaster declaration on ADDRESSES: Submit completed loan For Physical Damage: 05/25/2006, applications for disaster applications to: U.S. Small Business loans may be filed at the address listed Administration, National Processing 10 15 U.S.C. 78s(b)(2). above or other locally announced and Disbursement Center, 14925 11 17 CFR 200.30–3(a)(12). locations. Kingsport Road, Fort Worth, TX 76155.

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FOR FURTHER INFORMATION CONTACT: A. place at the U.S. Small Business SMALL BUSINESS ADMINISTRATION Escobar, Office of Disaster Assistance, Administration, Wisconsin District– U.S. Small Business Administration, Milwaukee Office, 310 West Wisconsin National Small Business Development 409 3rd Street, SW., Suite 6050, Avenue, Suite 400, Milwaukee, Center Advisory Board Public Meeting Washington, DC 20416. Wisconsin 53203. The U.S. Small Business SUPPLEMENTARY INFORMATION: Notice is The purpose of the meeting will be to Administration (SBA) National Small hereby given that as a result of the discuss and provide an update on Business Development Center (SBDC) President’s major disaster declaration on disaster loan processing; a report on our Advisory Board will be hosting a public 05/25/2006, applications for disaster recently held lenders conference and annual meeting. The meeting will be loans may be filed at the address listed small business awards breakfast; new held on Monday, June 26, 2006 from 4 above or other locally announced and on-going initiatives. Information p.m. to 5:30 p.m. Pacific time. The locations. will be presented by the staff of the meeting will take place at the SBA San The following areas have been SBA, or others present. Diego District Office, 550 West C Street, determined to be adversely affected by Suite 550, San Diego, California 92101. the disaster: Anyone wishing to attend must contact Cindy Merrigan in writing or by The purpose of the meeting is to Primary Counties (Physical Damage and fax. Cindy Merrigan, U.S. Small discuss advisory board matters that may Economic Injury Loans): Business Administration, 740 Regent be presented by members, and the staff Belknap, Carroll, Hillsborough, of the U.S. Small Business Merrimack, Rockingham, Strafford. Street, Suite 100, Madison, Wisconsin 53715, telephone (608) 441–5560, fax Administration (SBA), with a view Contiguous Counties (Economic Injury towards constructively advancing and Loans Only): (202) 481–0815, e-mail: [email protected]. improving national and local SBDC New Hampshire: Cheshire, Coos, program operations. Grafton, Sullivan. Matthew K. Becker, Anyone wishing to attend the Massachusetts: Essex, Middlesex, Committee Management Officer. National Small Business Development Worcester. Center Advisory Board Meeting must Maine: Oxford, York. [FR Doc. E6–8689 Filed 6–5–06; 8:45 am] BILLING CODE 8025–01–P contact Erika Fischer, Senior Program The Interest Rates are: Analyst, U.S. Small Business Administration, Office of Small Percent SMALL BUSINESS ADMINISTRATION Business Development Centers, 409 3rd For Physical Damage: Street, SW., Washington, DC 20416, Homeowners with Credit Avail- National Advisory Council Public telephone (202) 205–7045 or fax (202) able Elsewhere ...... 5.875 Meeting 481–0681. Homeowners without Credit Matthew K. Becker, Available Elsewhere ...... 2.937 The U.S. Small Business Businesses with Credit Avail- Administration (SBA) National Committee Management Officer. able Elsewhere ...... 7.763 Advisory Council (NAC) will hold a [FR Doc. E6–8687 Filed 6–5–06; 8:45 am] Businesses and Non-Profit Or- BILLING CODE 8025–01–P ganizations without Credit public meeting on Friday, June 30, 2006 Available Elsewhere ...... 4.000 at 3 p.m. The meeting will take place Other (Including Non-Profit Or- using an audio/web conference system. ganizations) with Credit Avail- To participate, please call our toll free DEPARTMENT OF STATE able Elsewhere ...... 5.000 conferencing service at 1–866–740–1260 [Public Notice 5434] For Economic Injury: and enter access code 3711001 at the Businesses & Small Agricultural prompt. Determination and Certification Cooperatives without Credit Related to Colombian Armed Forces Available Elsewhere ...... 4.000 The purpose of the meeting is to provide and discuss recent updates Under Section 556 of the Foreign Operations, Export Financing, and The number assigned to this disaster pertaining to the delivery of the Related Programs Appropriations Act, for physical damage is 104786 and for Agency’s programs and services. 2005 (Division D, Pub. L. 108–447) economic injury is 104770. Information will be presented by the staff of the SBA, members of the council Pursuant to the authority vested in me (Catalog of Federal Domestic Assistance or interested others. Numbers 59002 and 59008) as Secretary of State, including under Anyone wishing to attend or to make section 556 of the Foreign Operations, Herbert L. Mitchell, a presentation must contact Balbina Export Financing, and Related Programs Associate Administrator for Disaster Caldwell in writing, phone or e-mail in Appropriations Act, 2005 (Division D, Assistance. order to be put on the agenda. Balbina Pub. L. 108–447 ‘‘the Act’’), I hereby [FR Doc. E6–8685 Filed 6–5–06; 8:45 am] Caldwell, Director, National Advisory determine and certify that the BILLING CODE 8025–01–P Council, SBA Headquarters, 409 3rd Colombian Armed Forces are, in Street, SW., Washington, DC 20416, accordance with the conditions phone (202) 205–6914, e-mail: contained in section 556(a)(3) of the SMALL BUSINESS ADMINISTRATION [email protected]. For more Act, continuing to meet the conditions Wisconsin District Advisory Council; information about the National contained in (A) through (E) below and Public Meeting Advisory Council, see our Web site at are conducting vigorous operations to http://www.sba.gov/nac/index.html. restore government authority and The U.S. Small Business respect for human rights in areas under Administration (SBA) Wisconsin Matthew K. Becker, the effective control of paramilitary and District Advisory Council will be Committee Management Officer. guerilla organizations. hosting an open meeting on Wednesday, [FR Doc. E6–8688 Filed 6–5–06; 8:45 am] The above-mentioned conditions are June 21, 2006. The meeting will take BILLING CODE 8025–01–P that: (A) The Commander General of the

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Colombian Armed Forces is suspending DEPARTMENT OF STATE DEPARTMENT OF STATE from the Armed Forces those members, [Public Notice 5406] of whatever rank who, according to the [Public Notice 5424] Minister of Defense or the Procuraduria Overseas Security Advisory Council General de la Nacion, have been Advisory Committee on Historical (OSAC) Meeting Notice credibly alleged to have committed Diplomatic Documentation Notice of gross violations of human rights, Meeting Closed Meeting including extra-judicial killings, or to The Department of State announces a have aided or abetted paramilitary Summary: The Advisory Committee meeting of the U.S. State Department— organizations; (B) the Colombian on Historical Diplomatic Documentation Overseas Security Advisory Council on Government is vigorously investigating will meet in the Department of State, June 28, 2006 at the Federal Bureau of and prosecuting those members of the Annex 1, 2401 E Street, NW., Investigation, Washington, DC. Pursuant Colombian Armed Forces, of whatever Washington, DC, June 19–20, 2006, in to Section 10(d) of the Federal Advisory rank, who have been credibly alleged to Conference Room 316. Prior notification Committee Act and 5 U.S.C. 552b[c][4], have committed gross violations of and a valid government-issued photo ID it has been determined that the meeting human rights, including extra-judicial (such as driver’s license, passport, U.S. will be closed to the public. The killings, or to have aided or abetted government or military ID) are required meeting will focus on an examination of paramilitary organizations, and is for entrance into the building. Members corporate security policies and promptly punishing those members of of the public planning to attend must procedures and will involve extensive the Colombian Armed Forces found to notify Chris Tudda, Office of the discussion of proprietary commercial have committed such violations of Historian (202–663–3054) no later than and financial information that is human rights or to have aided or abetted June 12, 2006 to provide date of birth, considered privileged and confidential. paramilitary organizations; (C) the valid government-issued photo ID (such The agenda will include updated Colombian Armed Forces have made as driver’s license, passport, U.S. committee reports, a global threat substantial progress in cooperating with government ID number/agency or overview, and other matters relating to civilian prosecutors and judicial military ID number/branch), and private sector security policies and authorities in such cases (including relevant telephone numbers. If you protective programs and the protection providing requested information, such cannot provide one of the enumerated of U.S. business information overseas. as the identity of persons suspended forms of ID, please consult Chris Tudda For More Information Contact: Marsha from the Armed Forces and the nature for acceptable alternative forms of Thurman, Overseas Security Advisory and cause of the suspension, and access picture identification. Council, Department of State, to witnesses, relevant military The Committee will meet in open Washington, DC 20522–2008, phone: documents, and other requested session from 1:30 p.m. through 3 p.m. 571–345–2214. information); (D) the Colombian Armed on Monday, March 6, 2006, in Room Dated: May 24, 2006. 1105 to discuss declassification and Forces have made substantial progress Joe D. Morton, in severing links (including denying transfer of Department of State records to the National Archives and Records Director of the Diplomatic Security Service, access to military intelligence, vehicles, Department of State. and other equipment or supplies, and Administration and the status of the [FR Doc. E6–8730 Filed 6–5–06; 8:45 am] ceasing other forms of active or tacit Foreign Relations series. The remainder cooperation) at the command, battalion, of the Committee’s sessions from 3:15 BILLING CODE 4710–43–P and brigade level, with paramilitary p.m. until 4:30 p.m. on Monday, June organizations, especially in regions 19, 2006, and 9 a.m. until 1 p.m. on where these organizations have a Tuesday, June 20, 2006, will be closed DEPARTMENT OF TRANSPORTATION in accordance with Section 10(d) of the significant presence; (E) the Colombian Federal Railroad Administration Government is dismantling paramilitary Federal Advisory Committee Act (Pub. leadership and financial networks by L. 92–463). The agenda calls for Petition for Waiver of Compliance arresting commanders and financial discussions of agency declassification backers, especially in regions where decisions concerning the Foreign In accordance with Part 211 of Title these networks have a significant Relations series and other 49 Code of Federal Regulations (CFR), presence. declassification issues. These are notice is hereby given that the Federal matters not subject to public disclosure Railroad Administration (FRA) received The Department of State has under 5 U.S.C. 552b(c)(1) and the public a request for a waiver of compliance periodically consulted with interest requires that such activities be with certain requirements of its safety internationally recognized human rights withheld from disclosure. standards. The individual petition is organizations regarding the Colombian described below, including the party Armed Forces’ progress in meeting the Questions concerning the meeting should be directed to Marc J. Susser, seeking relief, the regulatory provisions abovementioned conditions, as involved, the nature of the relief being provided in section 556(c) of the Act. Executive Secretary, Advisory Committee on Historical Diplomatic requested, and the petitioner’s This Determination shall be published Documentation, Department of State, arguments in favor of relief. in the Federal Register and copies shall Office of the Historian, Washington, DC City of Placentia, California be transmitted to the appropriate 20520, telephone (202) 663–1123, (e- committees of Congress. mail [email protected]). [Waiver Petition Docket Number FRA–2006– 24654] Dated: May 26, 2006. Dated: May 24, 2006. The City of Placentia, California (City) Condoleezza Rice, Marc Susser, has petitioned for temporary waiver of Secretary of State. Executive Secretary, Department of State. the deadline of June 24, 2006, provided [FR Doc. E6–8728 Filed 6–5–06; 8:45 am] [FR Doc. E6–8729 Filed 6–5–06; 8:45 am] for in 49 CFR 222.42 for continuation of BILLING CODE 4710–29–P BILLING CODE 4710–11–P an intermediate partial quiet zone. The

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City states that it is working with the Issued in Washington, DC on May 26, be considered by FRA before final BNSF Railway Company to establish a 2006. action is taken. Comments received after 24-hour quiet zone, that certain Grady C. Cothen, Jr., that date will be considered as far as improvements have already been made Deputy Associate Administrator for Safety practicable. All written communications to the benefit of safety, and that all Standards and Program Development. concerning these proceedings are necessary improvements will be [FR Doc. E6–8733 Filed 6–5–06; 8:45 am] available for examination during regular completed by September 22, 2006. The BILLING CODE 4910–06–P business hours (9 a.m.–5 p.m.) at the City seeks to retain the current above facility. All documents in the nighttime quiet zone in order to avoid public docket are also available for disruption and confusion during the DEPARTMENT OF TRANSPORTATION inspection and copying on the Internet period permanent arrangements are at the docket facility’s Web site at being completed and states that safety Federal Railroad Administration http://dms.dot.gov. will not be compromised. Petition for Waiver of Compliance Anyone is able to search the Interested parties are invited to electronic form of all comments participate in these proceedings by In accordance with Part 211 of Title received into any of our dockets by the submitting written views, data, or 49 Code of Federal Regulations (CFR), name of the individual submitting the comments. Each comment shall set forth notice is hereby given that the Federal comment (or signing the comment, if specifically the basis upon which it is Railroad Administration (FRA) received submitted on behalf of an association, made, and contain a concise statement a request for a waiver of compliance business, labor union, etc.). You may of the interest of the commenter in the with certain requirements of its safety review DOT’s complete Privacy Act proceeding. FRA does not anticipate standards. The individual petition is Statement in the Federal Register scheduling a public hearing in described below, including the party published on April 11, 2000 (Volume connection with these proceedings since seeking relief, the regulatory provisions 65, Number 70; Pages 19477–78). The the facts do not appear to warrant a involved, the nature of the relief being Statement may also be found at http:// hearing. If any interested party desires requested, and the petitioner’s dms.dot.gov. an opportunity for oral comment, they arguments in favor of relief. Issued in Washington, DC on May 26, should notify FRA within 15 days of the 2006. date of publication of this notice, in Gettysburg & Northern Railroad Grady C. Cothen, Jr., writing, and specify the basis for their Company Deputy Associate Administrator for Safety request. [Waiver Petition Docket Number FRA–2005– All communications concerning these 23489] Standards and Program Development. proceedings should identify the docket The Gettysburg & Northern Railroad [FR Doc. E6–8738 Filed 6–5–06; 8:45 am] number set forth above and must be Company (GNRR) seeks a waiver of BILLING CODE 4910–06–P submitted to the Docket Clerk, DOT compliance from certain provisions of Docket Management Facility, Room PL– the Safety Glazing Standards, 49 CFR DEPARTMENT OF TRANSPORTATION 401 (Plaza Level), 400 7th Street, SW., 223.11, that requires certified glazing for Washington, DC 20590. one locomotive. The GNRR is located in Federal Railroad Administration Communications received within 30 Peoria, IL, and operates over 25.5 miles days of the date of this notice will be of track at a speed not exceeding 15 Petition for Waiver of Compliance considered by FRA before final action is miles per hour. The terrain is mostly taken. Comments received after that rural with light residential and In accordance with Part 211 of Title date will be considered as far as commercial surroundings. This 49 Code of Federal Regulations (CFR), practicable. FRA reserves the right to locomotive is used primarily in notice is hereby given that the Federal grant temporary relief to avoid lapse of passenger service during the summer Railroad Administration (FRA) has the existing partial quiet zone while the excursion season. During the off season, received a request for a waiver of comment period is open, after this locomotive is stored inside a diesel compliance with certain requirements of consideration of any comments filed shop. its safety standards. The individual prior to the initial date of decision. All Interested parties are invited to petition is described below, including written communications concerning participate in these proceedings by the party seeking relief, the regulatory these proceedings are available for submitting written views, data, or provisions involved, the nature of the examination during regular business comments. FRA does not anticipate relief being requested, and the hours (9 a.m.–5 p.m.) at the above scheduling a public hearing in petitioner’s arguments in favor of relief. facility. All documents in the public connection with these proceedings since Hoosier Valley Railroad Museum docket are available for inspection and the facts do not appear to warrant a copying on the Internet at the docket hearing. If any interested party desires [Docket Number FRA–2006–24647] facility’s Web site: http://dms.dot.gov. an opportunity for oral comment, they The Hoosier Valley Railroad Museum Anyone is able to search the should notify FRA, in writing, before (HVRM) seeks a permanent waiver of electronic form of all comments the end of the comment period and compliance from Control of Alcohol and received into any of our dockets by the specify the basis for their request. Drug Use, 49 CFR Part 219 Subparts D name of the individual submitting the All communications concerning these through J, which require a railroad to comment (or signing the comment, if proceedings should identify the conduct reasonable suspicion alcohol submitted on behalf of an association, appropriate docket number (e.g., Waiver and/or drug testing, pre-employment business, labor union, etc.). You may Petition Docket Number 2005–23489) drug testing, random alcohol and drug review DOT’s complete Privacy Act and must be submitted to the Docket testing, and to have voluntary referral Statement in the Federal Register Clerk, DOT Docket Management and co-worker report policies, and published on April 11, 2000 (Volume Facility, Room PL–401 (Plaza Level), which also specify drug and alcohol 65, Number 70; Pages 19477–78). The 400 7th Street, SW., Washington, DC testing procedures and record-keeping Statement may also be found at http:// 20590. Communications received within requirements. HVRM has less than 16 dms.dot.gov. 45 days of the date of this notice will hours of service employees, and while

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it is not currently part of the general Issued in Washington, DC on May 26, connection with these proceedings since railroad system of transportation, it will 2006. the facts do not appear to warrant a begin operation of tourist trains on five Grady C. Cothen, Jr., hearing. If any interested party desires to ten miles of the 33 miles of track Deputy Associate Administrator for Safety an opportunity for oral comment, they owned by the Incorporated Town of Standard and Program Development. should notify FRA, in writing, before North Judson, Indiana between North [FR Doc. E6–8737 Filed 6–5–06; 8:45 am] the end of the comment period and Judson and LaCrosse, IN. The BILLING CODE 4910–06–P specify the basis for their request. Chesapeake & Indiana Railroad (CKIN) All communications concerning these conducts freight operations on 23 miles proceedings should identify the DEPARTMENT OF TRANSPORTATION of this 33-mile rail line; however, the appropriate docket number (FRA–2006– 24562) and must be submitted to the only common track use would be a wye Federal Railroad Administration Docket Clerk, DOT Docket Management track in LaCrosse. HVRM’s tourist train Petition for Waiver of Compliance Facility, Room PL–401 (Plaza Level), operations would normally be 400 7th Street, SW., Washington, DC conducted on weekends and would not In accordance with Part 211 of Title 20590. Communications received within operate at the same time as the CKIN 49 Code of Federal Regulations (CFR), 30 days of the date of this notice will freight trains. notice is hereby given that the Federal be considered by FRA before final Interested parties are invited to Railroad Administration (FRA) received action is taken. Comments received after participate in these proceedings by a request for a waiver of compliance that date will be considered as far as submitting written views, data, or with certain requirements of its safety practicable. All written communications comments. FRA does not anticipate standards. The individual petition is concerning these proceedings are scheduling a public hearing in described below, including the party available for examination during regular connection with these proceedings since seeking relief, the regulatory provisions business hours (9 a.m.–5 p.m.) at the the facts do not appear to warrant a involved, the nature of the relief being above facility. All documents in the hearing. If any interested party desires requested, and the petitioner’s public docket are available for arguments in favor of relief. an opportunity for oral comment, they inspection and copying on the Internet should notify FRA, in writing, before Northeast Illinois Regional Commuter at the docket facility’s Web site: http:// the end of the comment period and Railroad Corporation dms.dot.gov. Anyone is able to search the specify the basis for their request. [Waiver Petition Docket Number FRA–2006– electronic form of all comments All communications concerning these 24562] received into any of our dockets by the proceedings should identify the The Northeast Illinois Regional name of the individual submitting the appropriate docket number (e.g., Waiver Commuter Railroad Corporation (Metra), comment (or signing the comment, if Petition Docket Number FRA–2006– further identified herein as the railroad, submitted on behalf of an association, 24647) and must be submitted to the seeks approval for a waiver of business, labor union, etc.). You may Docket Clerk, DOT Central Docket compliance with the requirements of the review DOT’s complete Privacy Act Management Facility, Room PL–401, Passenger Equipment Safety Standards Statement in the Federal Register Washington, DC 20590–0001. contained in 49 CFR 238.309(b)(3), published on April 11, 2000 (Volume Communications received within 45 Periodic brake equipment maintenance, 65, Number 70; Pages 19477–78). The which requires that brake equipment days of the date of this notice will be Statement may also be found at http:// receive periodic maintenance at 736 considered by FRA before final action is dms.dot.gov. days. Metra requests an extension of the taken. Comments received after that time period to 1840 days for 26 new bi- Issued in Washington, DC on May 26, 2006. date will be considered as far as level electric passenger MU’s. practicable. All written communications The twenty-six new electric MU Grady C. Cothen, Jr., concerning these proceedings are locomotives for which the relief is being Deputy Associate Administrator for Safety available for examination during regular requested are being built by Sumitomo Standards and Program Development. business hours (9 a.m.–5 p.m.) at the Corporation of America/Nippon Sharyo [FR Doc. E6–8735 Filed 6–5–06; 8:45 am] above facility. All documents in the and the air brake system is provided by BILLING CODE 4910–06–P public docket are also available for Knorr Brake Corporation in inspection and copying on the Internet Westminster, Maryland. The railroad at the docket facility’s Web site at http:// explains that the brake application is DEPARTMENT OF TRANSPORTATION transmitted electronically to each MU’s dms.dot.gov. Federal Railroad Administration Friction Brake Control Unit (FBCU). The FRA wishes to inform all potential FBCU then provides the requested brake commenters that anyone is able to Notice of Application for Approval of application without drawing down search the electronic form of all Discontinuance or Modification of a brake pipe pressure. An Emergency Railroad Signal System or Relief From comments received into any of our Magnetic Valve (EMV) is provided on dockets by the name of the individual the Requirements of Title 49 Code of each MU for an electronic emergency Federal Regulations Part 236 submitting the comment (or signing the brake application. comment, if submitted on behalf of an Interested parties are invited to Pursuant to Title 49 Code of Federal association, business, labor union, etc.). participate in these proceedings by Regulations (CFR) Part 235 and 49 You may review DOT’s complete submitting written views, data, or U.S.C. 20502(a), the following railroad Privacy Act Statement in the Federal comments. Each comment shall set forth has petitioned the Federal Railroad Register published on April 11, 2000 specifically the basis upon which it is Administration (FRA) seeking approval (Volume 65, Number 70; Pages 19477– made, and contain a concise statement for the discontinuance or modification 78) or you may visit http://dms.dot.gov. of the interest of the commenter in the of the signal system or relief from the proceeding. FRA does not anticipate requirements of 49 CFR Part 236 as scheduling a public hearing in detailed below.

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[Docket Number FRA–2006–24706] FRA wishes to inform all potential purpose of this notice is to allow the Applicant: MTA Long Island Rail commenters that anyone is able to public an additional 30 days from the Road, Mr. Brian J. Finn, Chief Engineer, search the electronic form of all date of this notice to submit comments Jamaica Station, Jamaica, New York comments received into any of our in the information collection. dockets by the name of the individual 11435–4380. DATES: submitting the comment (or signing the Comments must be submitted on The Long Island Rail Road Company or before July 6, 2006. (LIRR) seeks relief from the comment, if submitted on behalf of an requirements of the Rules, Standard and association, business, labor union, etc.). ADDRESSES: Send comments to the Instructions, Title 49 CFR, Part 236, You may review DOT’s complete Office of Information and Regulatory § 236.51, Track circuit requirements, to Privacy Act Statement in the Federal Affairs, Office of Management and the extent that the LIRR be permitted to Register published on April 11, 2000 Budget, 725 17th Street, NW., utilize single rail track circuits which do (Volume 65, Number 70; Pages 19477– Washington, DC 20503, Attention DOT not provide for broken rail protection, in 78) or you may visit http://dms.dot.gov. Desk Officer. the vicinity of a new LIRR terminal FRA expects to be able to determine FOR FURTHER INFORMATION CONTACT: called Vanderbilt Yard (VD Yard). The these matters without an oral hearing. Blaine Keener by phone at (202) 366– LIRR is working to rebuild the existing However, if a specific request for an oral 0970, or by e-mail at VD Yard and replace it with a modern hearing is accompanied by a showing [email protected]. interlocked yard. The location of the that the party is unable to adequately present his or her position by written project is in Brooklyn, New York, on the SUPPLEMENTARY INFORMATION: PHMSA statements, an application may be set LIRR’s Atlantic Branch line, between invites comments on whether the for public hearing. existing Brook 1 and 2 Interlockings. collection of information related to the Applicant’s Justification for Relief Issued in Washington, DC on May 26, final rule requiring pipeline operators to 2006. establish public awareness programs is (1) The track speed for these circuits Grady C. Cothen, Jr., necessary for the proper performance of will be restricted to 5 mph. Deputy Associate Administrator for Safety the functions of the Department, (2) The signal aspect proposed for the Standards and Program Development. including whether the information will affected tracks will be ‘‘Restricting.’’ [FR Doc. E6–8736 Filed 6–5–06; 8:45 am] have practical utility; the accuracy of (3) The existing Brook 1 Interlocking BILLING CODE 4910–06–P the Department’s estimate of the burden at Flatbush Avenue contains existing of the information collection; ways to single rail track circuits, permitted by enhance the quality, utility, and clarity the granting of a previous waiver DEPARTMENT OF TRANSPORTATION of the information to be collected; and application. ways to minimize the burden of the (4) Passenger service will not be Pipeline and Hazardous Materials Safety Administration collection of information on provided on the yard tracks except for respondents, including the use of an emergency detour route that will [Docket No. PHMSA–03–15852] automated collection techniques or allow a passenger train to bypass the RIN 2137–AD96 other forms of information technology. main tracks if both main tracks are PHMSA solicited comments on this blocked. Request for Public Comments and information collection request as part of Any interested party desiring to Office of Management and Budget the rulemaking but received no protest the granting of an application (OMB) Approval of a New Information comments. PHMSA published a Final shall set forth specifically the grounds Collection as Required by the Final Rule on May 19, 2005 (70 FR 28833). upon which the protest is made, and Rule Titled ‘‘Pipeline Safety: Public contain a concise statement of the As used in this notice, ‘‘information Awareness Programs for Hazardous collection’’ includes all work related to interest of the party in the proceeding. Liquid and Gas Pipeline Operators.’’ Additionally, one copy of the protest preparing and disseminating shall be furnished to the applicant at the AGENCY: Pipeline and Hazardous information related to this address listed above. Materials Safety Administration recordkeeping requirement including All communications concerning this (PHMSA), Department of Transportation completing paperwork, gathering proceeding should be identified by the (DOT). information and conducting telephone docket number and must be submitted SUMMARY: This notice requests public calls. to the Docket Clerk, DOT Central Docket participation in the OMB approval Type of Information Collection Management Facility, Room PL–401 process for a new PHMSA information Request: New Collection. (Plaza Level), 400 7th Street, SW., collection related to a final rule Title of Information Collection: Public Washington, DC 20590–0001. requiring pipeline operators to establish Awareness Program. Communications received within 45 public awareness programs. In days of the date of this notice will be compliance with the Paperwork Respondents: 22,500 Hazardous considered by the FRA before final Reduction Act of 1995, this notice liquid and natural gas pipeline action is taken. Comments received after announces that the Information operators. that date will be considered as far as Collection Request (ICR) described Estimated Total Burden on practicable. All written communications below has been forwarded to OMB for Respondents: 517,480 hours. concerning these proceedings are an approval of a new collection. The Issued in Washington, DC on May 31, available for examination during regular ICR describes the nature of the 2006. business hours (9 a.m.–5 p.m.) at the information collection and the expected above facility. All documents in the burden. PHMSA received no comments Florence L. Hamn, public docket are also available for in response to a request for comment on Director of Regulations, Office of Pipeline inspection and copying on the internet the information collection during the Safety. at the docket facility’s Web site at rulemaking. The final rule was [FR Doc. E6–8696 Filed 6–5–06; 8:45 am] http://dms.dot.gov. published on May 19, 2005. The BILLING CODE 4910–60–P

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UNITED STATES INSTITUTE OF specific information on the competition application deadline per year, starting PEACE as well as instructions about how to October 1, 2006. The Unsolicited apply. Initiative offers support for research, Announcement of the 2006 Solicited ADDRESSES: If you are unable to access education and training, and the Initiative Effective October 1, 2006 our Web site, you may submit an dissemination of information on international peace and conflict AGENCY: United States Institute of Peace. inquiry to: United States Institute of resolution. The Unsolicited Initiative ACTION: Notice. Peace, Grant Program, Solicited Initiative, 1200 17th Street, NW., Suite competition is open to any project that SUMMARY: The Agency Announces 200, Washington, DC 20036–3011. (202) falls within the Institute’s broad changes to its Upcoming Spring 2006 429–3842 (phone). (202) 833–1018 (fax). mandate of international conflict Solicited Grant Competition. The (202) 457–1719 (TTY). E-mail: resolution. Solicited Initiative will focus on six [email protected]. Deadline: October 1, 2006. Application material available on countries as they relate to USIP’s FOR FURTHER INFORMATION CONTACT: The request and at http://www.usip.org/ mandate and starting October 1, 2006, Grant Program. Phone (202) 429–3842. grants. applications will be accepted E-mail: [email protected]. throughout the year. The Solicited Dated: June 1, 2006. DATES: Receipt of Application: October initiative is restricted to projects that fit 1, 2006. Notification Date: March 31, Michael Graham, specific themes or topics identified in 2007. advance by the Institute of Peace. Vice President for Administration. The 2006 Solicited Initiative will [FR Doc. 06–5129 Filed 6–5–06; 8:45 am] ADDRESSES: For Application Package: focus on the six countries outlined BILLING CODE 6820–AR–M United States Institute of Peace, Grant below. The specific themes and topics Program, 1200 17th Street, NW., Suite for each country may be found at our 200, Washington, DC 20036–3011. (202) Web site at: http://www.usip.org/grants/ UNITED STATES INSTITUTE OF 429–3842 (phone). (202) 833–1018 (fax). solicited.html. PEACE (202) 457–1719 (TTY). E-mail: • Colombia [email protected]. • Announcement of the Fall 2006 Iran FOR FURTHER INFORMATION CONTACT: The • Unsolicited Initiative Effective October Iraq Grant Program, Unsolicited Grants. • 1, 2006 Nigeria Phone (202) 429–3842. E-mail: • Pakistan AGENCY: United States Institute of Peace. [email protected]. • Sudan ACTION: Notice. Deadline: Starting October 1, 2006, Dated: June 1, 2006. USIP will accept solicited initiative SUMMARY: The Agency announces a Michael Graham, applications throughout the year. Please change to the Unsolicited Grant Vice President for Administration. visit our Web site at: http:// Program. The Unsolicited Initiative will [FR Doc. 06–5130 Filed 6–5–06; 8:45 am] www.usip.org/grants/solicited.html for be open on the basis of a single BILLING CODE 6820–AR–M

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Corrections Federal Register Vol. 71, No. 108

Tuesday, June 6, 2006

This section of the FEDERAL REGISTER DEPARTMENT OF DEFENSE Thursday, May 25, 2006, make the contains editorial corrections of previously following corrections: published Presidential, Rule, Proposed Rule, Department of the Army 1. On page 30123, in the second and Notice documents. These corrections are column, the subject heading is corrected prepared by the Office of the Federal Record of Decision for the Chemical to read as set forth above. Register. Agency prepared corrections are and Biological Defense Program issued as signed documents and appear in 2. On page 30124, in the first column, (CBDP) Final Programmatic in the file line, ‘‘BILLING CODE 371– the appropriate document categories Environmental Impact Statement elsewhere in the issue. 08–M’’ should read ‘‘BILLING CODE (FPEIS) 3710–08–M’’. Correction [FR Doc. C6–4859 Filed 6–5–06; 8:45 am] In notice document 06–4859 BILLING CODE 1505–01–D beginning on page 30123 in the issue of

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Part II

Department of Energy Federal Energy Regulatory Commission

18 CFR Parts 35 and 37 Preventing Undue Discrimination and Preference in Transmission Service; Proposed Rule

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DEPARTMENT OF ENERGY II. Background c. Whether Transmission Providers Should A. Historical Antecedent Be Subject to Revocation of Their Federal Energy Regulatory B. Order No. 888 and Subsequent Reforms Market-Based Rates for OATT Violations. Commission C. EPAct 2005 and Recent Developments d. Whether Certain OATT Violations III. The Need for Reform of Order No. 888 Should Be Considered Market A. Opportunities for Undue Discrimination Manipulation Under the Market 18 CFR Parts 35 and 37 Continue To Exist Behavior Rules and Section 1283 of [Docket Nos. RM05–25–000 and RM05–17– B. A Lack Of Transparency Undermines EPAct 2005 000] Confidence in Open Access and Impedes VI. Information Collection Statement Enforcement of Open Access VII. Environmental Analysis Preventing Undue Discrimination and Requirements VIII. Regulatory Flexibility Act Analysis Preference in Transmission Service C. Congestion and Inadequate IX. Comment Procedures Infrastructure Development Impede X. Document Availability May 19, 2006. Customers’ Use of the Grid Appendix A: Commenter Acronyms D. A Consistent Method of Measuring ATC Appendix B: Pro Forma Open Access AGENCY: Federal Energy Regulatory Transmission Tariff Commission, DOE. Has Not Been Established E. A Number of Transmission Pricing I. Introduction ACTION: Notice of proposed rulemaking. Policies May Impede the Use of the Grid F. EPAct 2005 Emphasized Certain Policies 1. Ten years have passed since the SUMMARY: The Federal Energy and Priorities for the Commission Commission issued its landmark Order Regulatory Commission is proposing IV. Summary, Scope and Applicability of the No. 888.1 Named after our new amendments to its regulations adopted Proposed Rule headquarters in Washington, DC, Order in Order Nos. 888 and 889, and to the A. Summary of Proposed Reforms . No. 888 sought to eradicate undue pro forma open access transmission B. Core Elements of Order No. 888 That discrimination in the provision of Are Retained tariff, to ensure that transmission transmission service in interstate services are provided on a basis that is 1. Federal/State Jurisdiction 2. Native Load Protection commerce. It did so by requiring that just, reasonable and not unduly 3. The Types of Transmission Services each public utility that owns, operates, discriminatory or preferential. Offered or controls facilities used for DATES: Comments are due August 7, 4. Functional Unbundling transmission in interstate commerce 2006. Reply comments are due C. Applicability of the Proposed Rule offer unbundled transmission service September 5, 2006. 1. Public Utility Transmission Providers pursuant to a standard Open Access 2. Non-Public Utility Transmission ADDRESSES: You may submit comments, Transmission Tariff (pro forma OATT) Providers/Reciprocity identified by Docket Nos. RM05–25–000 and separate its transmission and V. Proposed Modifications of the OATT merchant generation functions pursuant and RM05–17–000, by one of the A. Consistency and Transparency of ATC following methods: Calculations to a companion order issued that same 2 • Agency Web site: http:// B. Transmission Planning—Coordinated, day, Order No. 889. These remedies www.ferc.gov. Follow the instructions Open and Transparent Planning reduced barriers to entry, led to greater for submitting comments via the eFiling C. Transmission Pricing competition in bulk power markets and link found in the Comment Procedures 1. Imbalances provided the foundation for subsequent section of the preamble. 2. Credits for Network Customers regulatory reforms at both the federal • Mail: Commenters unable to file 3. Capacity Reassignment and state level. 4. ‘‘Operational’’ Penalties comments electronically must mail or 2. Although Order No. 888 has been a. Unauthorized Use Penalties successful in many important respects, hand deliver an original and 14 copies b. How Transmission Providers Should Pay of their comments to: Federal Energy the need for reform of the Order No. 888 Operational Penalties pro forma OATT has been apparent for Regulatory Commission, Office of the 5. ‘‘Higher of’’ Pricing Policy Secretary, 888 First Street, NE., D. Non-Rate Terms and Conditions some time. In 1999, the Commission 3 Washington, DC 20426. Please refer to 1. Potential Modifications to Long-Term held, in adopting Order No. 2000, that the Comment Procedures section of the Firm Point-to-Point Service 2. Hourly Firm Service 1 Promoting Wholesale Competition Through preamble for additional information on Open Access Non-discriminatory Transmission how to file paper comments. 3. Rollover Rights 4. Modification of Receipt or Delivery Services by Public Utilities; Recovery of Stranded FOR FURTHER INFORMATION CONTACT: Costs by Public Utilities and Transmitting Utilities, Points Order No. 888, 61 FR 21540 (May 10, 1996), FERC Daniel Hedberg (Technical Information), 5. Acquisition of Transmission Service Stats. & Regs. ¶ 31,036 (1996), order on reh’g, Order Office of Energy Markets and Reliability, a. Processing of Service Requests No. 888–A, 62 FR 12274 (Mar. 14, 1997), FERC Federal Energy Regulatory Commission, b. Queue Processing Business Practices Stats. & Regs. ¶ 31,048 (1997), order on reh’g, Order 888 First Street, NE., Washington, DC c. Reservation Priority No. 888–B, 81 FERC ¶ 61,248 (1997), order on reh’g, 6. Designation of Network Resources Order No. 888–C, 82 FERC ¶ 61,046 (1998), aff’d in 20426, (202) 502–6243. relevant part sub nom. Transmission Access Policy Kathleen Barro´n (Legal Information), a. Qualification as a Network Resource b. Documentation for Network Resources Study Group v. FERC, 225 F.3d 667 (D.C. Cir. 2000) (TAPS v. FERC), aff’d sub nom. New York v. FERC, Office of the General Counsel—Energy c. Undesignation of Network Resources Markets, Federal Energy Regulatory 535 U.S. 1 (2002). 7. Clarifications Related to Network 2 Open Access Same-Time Information System Commission, 888 First Street, NE., Service (Formerly Real-Time Information Networks) and Washington, DC 20426, (202) 502–6461. 8. Transmission Curtailments Standards of Conduct, Order No. 889, 61 FR 21737 David Withnell (Legal Information), 9. Standardization of Rules and Practices (May 10, 1996), FERC Stats. & Regs. ¶ 31,035 (1996), Office of the General Counsel—Energy 10. OATT Definitions order on reh’g, Order No. 889–A, FERC Stats. & Markets, Federal Energy Regulatory E. Enforcement Regs. ¶ 31,049 (1997), order on reh’g, Order No. 1. General Policy 889–B, 81 FERC ¶ 61,253 (1997). Commission, 888 First Street, NE., 3 Regional Transmission Organizations, Order No. Washington, DC 20426. (202) 502–8421. a. Compliance Review Regime b. Use of Independent Third Party Audits 2000, 65 FR 809 (Jan. 6, 2000), FERC Stats. & Regs. SUPPLEMENTARY INFORMATION: ¶ 31,089 (1999), order on reh’g, Order No. 2000–A, 2. Civil Penalties 65 FR 12088 (Mar. 8, 2000), FERC Stats. & Regs. Table of Contents a. Background ¶ 31,092 (2000), aff’d sub nom. Public Utility b. Whether Civil Penalties Should Be District No. 1 of Snohomish County, Washington v. I. Introduction Specified in the OATT FERC, 272 F.3d 607 (D.C. Cir. 2001).

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the pro forma OATT could not fully more difficult to detect. First, we under which each public utility must remedy undue discrimination because propose to improve transparency and treat third parties in a manner transmission providers retained both the consistency in several critical areas, comparable to its service to bundled incentive and the ability to discriminate such as the calculation of available customers. We are retaining the basic against third parties, particularly in transfer capability (ATC).7 We propose nature of the services being offered— areas where the pro forma OATT left the to direct public utilities, under the network service and point-to-point transmission provider with significant auspices of the North American Electric service. We are retaining the protection discretion.4 The Commission in Order Reliability Council (NERC) and the of native load customers embodied in No. 2000 thus encouraged utilities to North American Energy Standards Order No. 888, consistent with EPAct voluntarily join independent regional Board (NAESB), to provide for greater 2005’s new requirement that load- transmission organizations (RTOs) that consistency in ATC calculation. By serving entities be provided would operate their transmission reducing unnecessarily broad discretion transmission rights to meet their service facilities on a non-discriminatory basis in this and other areas, we will reduce obligations.8 We are retaining our and administer the OATT. The the ability of transmission providers to decision to exercise jurisdiction over Commission based Order No. 2003 on a unduly discriminate and provide them unbundled transmission service, but not similar finding, explaining that the greater certainty to facilitate compliance transmission service provided as part of interconnection process includes with our regulations. Second, we a bundled retail service. We are opportunities for undue discrimination propose to reform the transmission retaining the use of functional that may lead to delays that benefit planning requirements of the pro forma unbundling to address undue generation-owning transmission utilities OATT to eliminate potential undue discrimination, rather than requiring and undermine competition.5 While discrimination and support the corporate unbundling. We are retaining many regions of the country now have construction of adequate transmission the use of an OATT to facilitate the independent grid operators, not all do, facilities to meet the needs of all load- development of competitive wholesale and changes to the pro forma OATT are serving entities. The pro forma OATT markets by reducing barriers to entry necessary to reduce the opportunity for contains only minimal requirements through the control of transmission transmission providers to engage in regarding transmission planning, which assets, not imposing any particular undue discrimination. In the past ten have proven to be inadequate as the market structure on the industry. years new investment has faltered and Nation faces inadequate transmission 5. In proposing to reform Order No. many regions now experience chronic investment in many areas. We propose 888, we have relied heavily on the transmission congestion and inadequate to require public utilities to engage in an comments received in response to our infrastructure. Congress, through the open and transparent planning process notices of inquiry in the above- 9 Energy Policy Act of 2005 (EPAct at both the local and regional levels. captioned dockets. We appreciate the 2005),6 recognized this problem and Third, we propose to remedy certain time and thoughtfulness of all sectors of provided the Commission not only new portions of the pro forma OATT that the industry in preparing comments on tools to encourage infrastructure but may have permitted utilities to these notices of inquiry. We have found also made clear that the Commission discriminate against new merchant them very informative and useful and should use its existing authority to generation, including intermittent this Notice of Proposed Rulemaking ensure an adequate infrastructure to generation. For example, we propose to (NOPR) incorporates many of the support a vibrant economy. modify the energy imbalance provisions commenters’ suggestions. We invite 3. The reforms we propose today are of the pro forma OATT and adopt further comments on this NOPR. We intended to address deficiencies in the certain other tariff modifications. also are scheduling technical pro forma OATT that have become Fourth, we provide for greater conferences to more fully address the apparent since 1996 and to facilitate transparency in the provision of topics of ATC calculation and improved planning and operation of transmission service to allow transmission planning. transmission facilities. We summarize transmission customers better access to II. Background these reforms in Part IV.A below, but information to make their resource A. Historical Antecedent note the major focus of this reform effort procurement and investment decisions, here. As a general matter, the purpose as well as to increase our ability to 6. In the first few decades after of this rulemaking is to strengthen the detect any remaining incidents of undue enactment of the Federal Power Act pro forma OATT to ensure that it discrimination. Finally, we provide for (FPA) in 1935, the industry was achieves its original purpose— reform and greater clarity in areas that characterized mostly by self-sufficient, remedying undue discrimination—not have generated recurring disputes over vertically integrated electric utilities, in to create new market structures. We the past 10 years, such as rollover rights, which generation, transmission, and propose to achieve this goal by ‘‘redirects,’’ and generation redispatch. distribution facilities were owned by a increasing the clarity and transparency 4. Although the reforms being single entity and sold as part of a of the rules applicable to the planning proposed in these areas are significant, bundled service to wholesale and retail and use of the transmission system and we wish to underscore that we propose customers. Most electric utilities built by addressing ambiguities and the lack to maintain many of the core elements their own power plants and of sufficient detail in several important of Order No. 888. For example, we are transmission systems, entered into areas of the pro forma OATT. The lack retaining the comparability requirement interconnection and coordination of specificity in the pro forma OATT arrangements with neighboring utilities, creates opportunities for undue 7 We note that the Commission used the term discrimination as well as making the ‘‘Available Transmission Capability’’ in Order No. 8 EPAct 2005 sec. 1233 (to be codified at section undue discrimination that does occur 888 to describe the amount of additional capability 217(b)(4) of the FPA, 16 U.S.C. 824q). available in the transmission network to 9 Preventing Undue Discrimination and accommodate additional requests for transmission Preference in Transmission Services, Notice of 4 Order No. 2000 at 31,015. services. To be consistent with the term generally Inquiry, 112 FERC ¶ 61,299 (2005) (NOI); 5 See Order No. 2003 at P 11–12. accepted throughout the industry, the Commission Information Requirements for Available Transfer 6 Pub. L. 109–58, 119 Stat. 594 (to be codified in is proposing to revise the pro forma OATT to adopt Capability, Notice of Inquiry, 111 FERC ¶ 61,274 scattered itles of the U.S.C.). the term ‘‘Available Transfer Capability.’’ (2005) (ATC NOI).

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and entered into long-term contracts to many traditional vertically integrated own purposes. Rather, they typically make wholesale requirements sales utilities still did not provide open made available only point-to-point (bundled sales of generation and access to third parties and favored their transmission service, i.e., service from a transmission) to municipal, cooperative, own generation if and when they single point of receipt to a single point and other investor-owned utilities provided transmission access to third of delivery. As these early tariffs were connected to each utility’s transmission parties, access to cheaper, more efficient offered only by transmission providers system. Each system covered a limited generation sources remained limited. that volunteered to provide service to service area, which was defined by the 8. The Commission encouraged the third parties, they resulted in a retail franchise decisions of state development of independent power patchwork of open access that was not regulatory agencies. This structure of producers (IPPs), as well as emerging sufficient to facilitate wholesale separate systems arose naturally due power marketers, by authorizing market- generation markets. primarily to the cost and technological based rates for their power sales on a 9. In response to the competitive limitations on the distance over which case-by-case basis and by encouraging developments following PURPA, and electricity could be transmitted. more widely available transmission the fact that limited transmission access 7. A number of statutory, economic, access on a case-by-case basis. Market- and significant regulatory barriers and technological developments in the based rates helped to develop continued to constrain the development 1970s led to an increase in coordinated competitive bulk power markets by of generation by independent power operations and competition. Among allowing generating utilities to move producers, Congress enacted Title VII of those was the passage of the Public more quickly and flexibly to take the Energy Policy Act of 1992 (EPAct Utility Regulatory Policies Act of 1978 advantage of short-term or even long- 1992).14 EPAct 1992 reduced regulatory (PURPA),10 which was designed to term market opportunities than those barriers to entry by creating a class of lessen dependence on foreign fossil utilities operating under traditional ‘‘Exempt Wholesale Generators’’ that fuels by encouraging the development of cost-of-service tariffs. In approving these were exempt from the requirements of alternative generation sources and market-based rates, the Commission the Public Utility Holding Company Act imposing a mandatory purchase required that the seller and its affiliates of 1935.15 EPAct 1992 also expanded obligation on utilities for generation lack market power or mitigate any the Commission’s authority to approve from such sources. PURPA also enabled market power that they may have applications for transmission services the Commission to order wheeling of possessed.12 The major concern of the under sections 211 and 212 of the FPA. electricity under limited Commission was whether the seller or Though the Commission aggressively circumstances.11 The rapid expansion its affiliates could limit competition and implemented expanded section 211, it and performance of the independent thereby drive up prices. A key inquiry ultimately concluded that the power industry following the enactment became whether the seller or its procedural limitations in section 211 of PURPA demonstrated that traditional, affiliates owned or controlled thwarted the Commission’s ability to vertically integrated public utilities transmission facilities in the relevant effectively eliminate undue need not be the only sources of reliable service area and therefore, by denying discrimination in the provision of power. During this period, the profile of access or imposing discriminatory terms transmission service. generation investment began to change, or conditions on transmission service, and a market for non-traditional power could foreclose other generators from B. Order No. 888 and Subsequent supply beyond the purchases required competing. Beginning in the late 1980s, Reforms by PURPA began to emerge. The in order to mitigate their market power 10. In April 1996, as part of its economic and technological changes in to meet the Commission’s conditions, statutory obligation under sections 205 the transmission and generation sectors public utilities seeking Commission and 206 of the FPA to remedy undue helped encourage many new entrants in authorization for blanket approval of discrimination, the Commission the generating markets that could sell market-based rates for generation adopted Order No. 888 prohibiting electric energy profitably with smaller services under section 205 of the FPA public utilities from using their scale technology at a lower price than filed ‘‘open access’’ transmission tariffs monopoly power over transmission to many utilities selling from their existing of general applicability.13 The unduly discriminate against others. In generation facilities at rates reflecting Commission also approved proposed that order, the Commission required all cost. However, it became increasingly mergers under section 203 of the FPA public utilities that own, control or clear that the potential consumer on the condition that the merging operate facilities used for transmitting benefits that could be derived from companies remedy anticompetitive electric energy in interstate commerce to these technological advances could be effects potentially caused by the merger file open access non-discriminatory realized only if more efficient generating by filing ‘‘open access’’ tariffs. The early transmission tariffs that contained plants could obtain access to the tariffs submitted in market-based rate minimum terms and conditions of non- regional transmission grids. Because proceedings under section 205 and discriminatory service. It also obligated merger proceedings under section 203 such public utilities to ‘‘functionally 10 Pub. L. 95–617, 92 Stat. 3117 (1978) (codified in U.S.C. titles 15, 16, 26, 30, 42, and 43 (2000)). did not, however, provide access to the unbundle’’ their generation and 11 Section 211 of the FPA, 16 U.S.C. 824j (2000). transmission system that was transmission services. This meant In earlier years, a few customers were able to obtain comparable to the service the public utilities had to take transmission access as a result of litigation, beginning with the transmission providers used for their service (including ancillary services) for U.S. Supreme Court’s decision in Otter Tail Power Company v. United States, 410 U.S. 366 (1973). Additionally, some customers gained access by 12 See, e.g., Dartmouth Power Associates Limited 14 Pub. L. 102–486, 106 Stat. 2776 (1992) virtue of Nuclear Regulatory Commission license Partnership, 53 FERC ¶ 61,117 (1990); (codified at, among other places, 15 U.S.C. 79z–5a conditions and voluntary preference power Commonwealth Atlantic Limited Partnership, 51 and 16 U.S.C. 796 (22–25), 824j–l (2000)). transmission arrangements associated with federal FERC ¶ 61,368 (1990); Doswell Limited Partnership, 15 15 U.S.C. 79a (2000), repealed by EPAct 2005 power marketing agencies. See, e.g., Consumers 50 FERC ¶ 61,251 (1990); Citizens Power & Light sec. 1263; see Repeal of the Public Utility Holding Power Co., 6 NRC 887, 1036–44 (1977); Toledo Co., 48 FERC ¶ 61,210 (1989); Ocean State Power, Company Act of 1935 and Enactment of the Public Edison Co., 10 NRC 265, 327–34 (1979); Florida 44 FERC ¶ 61,261 (1988); and Orange and Rockland Utility Holding Company Act of 2005, Order No. Municipal Power Agency v. Florida Power and Light Utilities, Inc., 42 FERC ¶ 61,012 (1988). 667, 70 FR 75592 (Dec. 20, 2005), FERC Stats. & Company, 839 F. Supp. 1563 (M.D. Fla. 1993). 13 See Order No. 888 at 31,644 n.52. Regs. ¶ 31,197 (2005).

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their own new wholesale sales and retail transmission in interstate ‘‘should create an adequate incentive for purchases of electric energy under the commerce by public utilities, it them to calculate ATC and TTC as open access tariffs, and to separately nevertheless recognized the legitimate accurately and as uniformly as state their rates for wholesale concerns of state regulatory authorities possible.’’ 24 generation, transmission and ancillary regarding the transmission component 15. The electric industry continued to services.16 Each public utility was of bundled retail sales. The Commission undergo economic and regulatory required to file the pro forma OATT therefore declined to extend its changes in the years following the included in Order No. 888 without any unbundling requirement to the issuance of Order No. 888. Retail access deviation (except a limited number of transmission component of bundled was adopted by approximately 25 states terms and conditions that reflect retail sales. On appeal, the U.S. in the late 1990s.25 This state regional practices).17 After the Supreme Court affirmed this element of restructuring activity spurred significant effectiveness of their OATTs, public Order No. 888, finding that the changes at the wholesale level as well utilities were allowed to file, pursuant Commission made a statutorily by encouraging or requiring the to section 205 of the FPA, deviations permissible choice.20 divestiture of generation plants by that were consistent with or superior to 13. The same day it issued Order No. traditional electric utilities and the the pro forma OATT’s terms and 888, the Commission issued a development of ISOs that could manage conditions. Because certain owners and companion order, Order No. 889, short-term energy markets necessary to controllers or operators of interstate addressing both the separation of support retail access. At the same time, transmission facilities were not subject vertically integrated utilities’ there was a significant increase in the to the Commission’s jurisdiction under transmission and merchant functions, number of mergers between traditional sections 205 and 206 and thus were not the information transmission providers electric utilities and between electric subject to Order No. 888, the were required to make public and the utilities and gas pipeline companies, Commission adopted a reciprocity electronic means they were required to and large increases in the number of provision in the pro forma OATT which use to do so. Order No. 889 imposed power marketers and independent conditions the use by non-public Standards of Conduct governing the generation facility developers entering utilities of public utilities’ open access separation of, and communications the marketplace. Trade in bulk power services on an agreement to offer open between, the utility’s transmission and markets increased significantly and the access services in return. wholesale power functions, to prevent Nation’s transmission grid was used 11. In addition to imposing the the utility from giving its merchant arm more heavily and in new ways as functional unbundling requirement, the preferential access to transmission customers took advantage of the pro Commission also encouraged broader information. All public utilities that forma OATT and purchased power from reforms through the formation of owned, controlled or operated facilities competitive sellers. independent system operators (ISOs). used in the transmission of electric 16. In the wake of these changes, in The Commission stated that ISOs ‘‘have energy in interstate commerce were December 1999, the Commission the potential to provide significant required to create or participate in an adopted Order No. 2000.26 That benefits (e.g., to help provide regional Open Access Same-Time Information rulemaking recognized that Order No. efficiencies, to facilitate economically System (OASIS) that was to provide 888 set the foundation upon which efficient pricing, and, especially in the existing and potential transmission competitive electric markets could context of power pools, to remedy customers the same access to develop, but did not eliminate the undue discrimination and mitigate transmission information. potential to engage in undue market power) and will further our goal 14. Among the information required discrimination and preference in the of achieving a workably competitive to be posted by Order No. 889 was the provision of transmission service.27 The market.’’ 18 While the Commission transmission provider’s calculation of rulemaking also recognized that Order declined to mandate ISOs, it set forth ATC. Though the Commission No. 888 did not address the regional eleven principles for assessing ISO acknowledged that before-the-fact nature of the grid, including the proposals submitted to the measurement of the availability of treatment of parallel flows, pancaked Commission.19 transmission service is ‘‘difficult,’’ it rates, and congestion management. 12. Order No. 888 also clarified the concluded that it was important to give Thus, the Commission encouraged the Commission’s interpretation of the potential transmission customers ‘‘an creation of RTOs to address important federal/state jurisdictional boundaries easy-to-understand indicator of service operational and reliability issues and over transmission and local distribution. availability.’’ 21 Because formal methods eliminate any residual discrimination in While it reaffirmed that the Commission did not then exist to calculate ATC and transmission services that can occur has exclusive jurisdiction over the rates, total transfer capability (TTC), the when the operation of the transmission terms, and conditions of unbundled Commission encouraged industry efforts system remains in the control of a to develop consistent methods for vertically integrated utility. The 16 This is known as ‘‘functional unbundling’’ calculating ATC and TTC.22 Order No. Commission found that RTOs would because the transmission element of a wholesale increase the efficiency of wholesale sale is separated or unbundled from the generation 889 ultimately required transmission element of that sale, although the public utility may providers to base their calculations on markets by eliminating pancaked rates, retain ownership over both functions. See infra Part ‘‘current industry practices, standards internalizing parallel flow, managing IV.B.4. and criteria’’ and to describe their congestion efficiently and operating 17 See Order No. 888 at 31,769–70 (noting that the methodology in their tariffs.23 The markets for energy, capacity and pro forma OATT expressly identified certain non- ancillary services. The Commission rate terms and conditions, such as the time Commission noted that the requirement deadlines for determining available capability in that transmission providers purchase section 18.4 or scheduling changes in sections 13.8 only ATC that is posted as available 24 Id. and 14.6, that may be modified to account for 25 See Energy Information Administration, Retail regional practices if such practices are reasonable, Unbundling—U.S. Summary (2005), http:// generally accepted in the region, and consistently 20 New York v. FERC, 535 U.S. 1 (2002). www.eia.doe.gov/oil_gas/natural_gas/restructure/ adhered to by the transmission provider). 21 Order No. 889 at 31,605. state/us.html. 18 Order No. 888 at 31,655. 22 Id. at 31,607. 26 See supra note 3. 19 Id. at 31,730–32. 23 Id. 27 Order No. 2000 at 31,015.

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established an open, collaborative (except for certain small entities) to to more readily identify violations and process that relied on voluntary regional provide access to their transmission facilitate compliance. participation to design RTOs tailored to facilities on a comparable basis.33 20. The Commission received over the specific needs of each region. The Congress further ordered the 4,000 pages of initial and reply Commission noted, however, that ‘‘[i]f Department of Energy (DOE) to study comments on the NOI. Based on these the industry fails to form RTOs under the benefits of economic dispatch and comments, the comments submitted in this approach, the Commission will required the Commission to convene response to the ATC NOI, our reconsider what further regulatory steps regional joint boards to develop a report experience in implementing Order No. are in the public interest.’’ 28 to Congress containing 888, and the changes in the industry 17. Following Order No. 2000, RTOs recommendations for the use of security since we adopted it, we conclude that were approved in several regions of the constrained economic dispatch within reform of the pro forma OATT is country including the Northeast (PJM each region.34 Congress also directed the necessary, for the reasons we discuss Interconnection, Inc.; ISO New Commission to facilitate price next. England), the Midwest (MISO) and the transparency in markets for the sale and III. The Need for Reform of Order No. South (SPP). In most cases, RTOs have transmission of electric energy in 888 assumed responsibility for calculating interstate commerce, having due regard ATC across the footprint of the RTO, as for the public interest, the integrity of A. Opportunities for Undue well as the planning and expansion of those markets, fair competition, and the Discrimination Continue To Exist the transmission grid, at least for protection of consumers, and it 21. In Order No. 2000, the facilities necessary for maintaining authorized the Commission to prescribe Commission found that ‘‘opportunities system reliability. However, large areas rules to provide for the dissemination of for undue discrimination continue to of the Nation have not developed RTOs information about the availability and exist that may not be remedied using the voluntary structure adopted price of wholesale electric energy and adequately by [the] functional by the Commission in Order No. 2000. transmission service.35 Finally, unbundling [remedy of Order No. Moreover, transmission customers have Congress emphasized compliance with 888].’’ 37 The Commission made a complained that even in RTO markets the Commission’s regulations, similar finding in Order No. 2003, there are instances when comparable increasing the civil and criminal holding that opportunities for undue transmission service is not provided, penalties for violations of Commission- discrimination continue to exist in areas particularly in the area of transmission administered statutes and regulations.36 where the pro forma OATT leaves planning. 19. Recognizing the need for reform of transmission providers with substantial C. EPAct 2005 and Recent Order No. 888 in light of these discretion.38 The Commission has a Developments developments and those described in responsibility under section 206 of the FPA to remedy undue discrimination.39 18. EPAct 2005,29 enacted on August the next section, the Commission issued Our action today proposes to fulfill that 8, 2005, added a number of new an NOI in September 2005 seeking responsibility by proposing reforms to authorities and priorities for the comments on the reforms needed to the the pro forma OATT that will address Commission and emphasized certain of Order No. 888 pro forma OATT to remaining opportunities for undue its existing obligations. Specifically, prevent undue discrimination and preference in the provision of discrimination. EPAct 2005 recognized the importance 22. As the Commission noted in Order of adequate transmission infrastructure transmission services. In the NOI, the Commission expressed its preliminary No. 888, it is in the economic self- development and its role in facilitating interest of transmission monopolists, the development of competitive view that reforms to the pro forma OATT and public utilities’ OATTs are particularly those with high-cost wholesale markets. For example, generation assets, to deny transmission Congress required the Commission to necessary to avoid undue discrimination or preference in the or to offer transmission on a basis that adopt a rule establishing incentive is inferior to that which they provide ratemaking for transmission provision of transmission service. The NOI sought comments on how best to themselves.40 Such an incentive can infrastructure to help promote reliability lead to unduly discriminatory behavior and reduce congestion.30 Congress accomplish the Commission’s goals, further directed the Commission to specifically with respect to enhancements that are needed to: (1) 37 Order No. 2000 at 31,105. ‘‘exercise its authority’’ under EPAct 38 Remedy any unduly discriminatory or Order No. 2003 at P 11–12. 2005 ‘‘in a manner that facilitates the 39 In Associated Gas Distributors v. FERC, 824 planning and expansion of transmission preferential application of the pro forma F.2d 981 (D.C. Cir. 1987), (AGD), the court facilities to meet the reasonable needs of OATT or (2) improve the clarity of the concluded that, like the Natural Gas Act, the FPA 31 Order No. 888 pro forma OATT and the ‘‘fairly bristles’’ with concern over undue load-serving entities.’’ Congress also discrimination. Based on AGD, the Commission gave the Commission certain ‘‘backstop’’ individual public utility tariffs in order determined in Order No. 888 that: transmission siting authority, and The Commission has a mandate under sections authorized the creation of interstate 33 EPAct 2005 sec. 1231 (to be codified at section 205 and 206 of the FPA to ensure that, with respect 211A of the FPA, 16 U.S.C. 824j–1). to any transmission in interstate commerce or any compacts establishing transmission 34 EPAct 2005 sec. 1234 (to be codified at 42 sale of electric energy for resale in interstate 32 siting agencies. EPAct 2005 also U.S.C. 16432); EPAct 2005 sec. 1298 (to be codified commerce by a public utility, no person is subject authorized the Commission to require at section 223 of the FPA, 16 U.S.C. 824w). EPAct to any undue prejudice or disadvantage. We must unregulated transmitting utilities 2005 defined economic dispatch as ‘‘the operation determine whether any rule, regulation, practice or of generation facilities to produce energy at the contract affecting rates for such transmission or sale lowest cost to reliably serve consumers, recognizing for resale is unduly discriminatory or preferential, 28 Id. at 30, 993. any operational limits of generation and and must prevent those contracts and practices that 29 See supra note 6. transmission facilities.’’ EPAct 2005 sec. 1234 (b). do not meet this standard. * * * AGD demonstrates 30 EPAct 2005 sec. 1241 (to be codified at section 35 EPAct 2005 sec. 1281 (to be codified at section that our remedial power is very broad and includes 219 of the FPA, 16 U.S.C. 824s). 220 of the FPA, 16 U.S.C. 824t). the ability to order industry-wide non- 31 EPAct 2005 sec. 1233(a) (to be codified at 36 EPAct 2005 sec. 1284(d) (to be codified at discriminatory open access as a remedy for undue section 217(b)(4) of the FPA, 16 U.S.C. 824q). section 316 of the FPA, 16 U.S.C. 825o); EPAct 2005 discrimination. 32 EPAct 2005 sec. 1221(a) (to be codified at sec. 1284(e) (to be codified at section 316A of the Order No. 888 at 31,669. section 216 of the FPA, 16 U.S.C. 824p). FPA, 16 U.S.C. 825o–1). 40 Id. at 31,682.

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against third parties, particularly if and/or the perception thereof. Progress incentives to use the system differently, public utilities have unnecessarily Energy agrees that several OATT and more efficiently, to serve its own broad discretion in the application of provisions can be interpreted loads than to serve its other customers their tariffs. This discretion also can differently, leaving room for under the pro forma OATT. TDU create problems for transmission disagreement as to their meaning. Systems urges the Commission to providers seeking to comply with our 24. Perhaps the most obvious ensure that transmission providers make regulations in good faith because so deficiency in this regard is ATC their actions under the OATT many issues are left for their calculation. In Order Nos. 888 and 889, completely transparent on a timely basis interpretation, thereby increasing the the Commission declined to require a to all transmission customers. NARUC possibility of disputes with specific methodology for ATC posits that enhanced reporting transmission customers and calculation. As a result, there are few requirements, if sufficiently targeted, enforcement actions by the clear rules respecting ATC calculation, would facilitate greater transparency in Commission.41 Transmission customers and transmission providers, therefore, transmission activities. Alberta also have found ways to use the tariffs retain unnecessarily broad discretion in Intervenors states that the current pro to their own advantage, particularly in this area. On systems where forma OATT provides transmission the scheduling and queuing processes.42 transmission capacity is congested, this customers with only a narrow glimpse Finally, tariff provisions have been lack of consistency, coupled with a lack of how the system is being operated. For modified in numerous ways on a of transparency, has led to recurring example, Bonneville notes that many company-by-company basis, leading to disputes over whether the transmission terms and conditions of native load uncertainties within the industry as to provider is exercising its discretion to service are not transparent to OATT the proper interpretation of those discriminate against its competitors. transmission customers.45 EEI also provisions and to unnecessarily 25. There is a similar lack of clarity states that greater transparency, such as inconsistent treatment of transmission in the transmission provider’s planning with respect to ATC calculation, can customers across public utilities. obligations. Order No. 888 included a increase confidence in open access and 23. Commenters suggest that general obligation on the part of the potentially reduce claims of undue enhanced clarity and consistency in the transmission providers to plan on a discrimination. pro forma OATT would go a long way comparable basis (i.e., comparable to the 27. Calpine argues that undue toward eliminating the opportunities for manner in which it would plan for its discrimination is difficult to detect undue discrimination and the own needs) to serve network loads and given the lack of access to data, 43 perception that it is occurring. Calpine to construct new facilities as necessary analytical assumptions, and processes notes that undue discrimination is most to respond to requests for firm service used by transmission providers to likely to occur when the transmission from point-to-point customers. determine transmission access and provider retains discretion to implement However, there were no clear guidelines service. It recommends that the an OATT provision in a manner that with respect to whether transmission Commission increase reporting favors its affiliated generation. APPA customers should be included in the requirements for denials of transmission asserts that the success of the OATT planning process, what standards and service, for congestion management regime depends on public utilities’ criteria should be used in system mitigation events, including ability to faithfully implement the planning, and whether the planning curtailments and redispatch, and for OATT’s provisions. Large transmission process should identify potential transmission expansion planning providers share this view to some economic upgrades that could benefit a decisions. Powerex notes that the degree. Entergy notes that a lack of wide range of customers, as opposed to Commission already has posting clarity is at the heart of many disputes responding only to customer-specific standards, and urges the Commission to involving the OATT, and urges the requests. Here too, this lack of clarity enforce them and to increase Commission to improve the OATT in a has led to significant disputes over requirements to provide more manner that will minimize the potential whether transmission providers are meaningful posting of reliable ATC data, for future violations. Duke posits that planning on a nondiscriminatory basis curtailment methodology and results, tariff terms and conditions that are or are favoring service to their own details relating to denials of service, and susceptible to multiple interpretations loads. congestion information. Constellation present opportunities for discrimination B. A Lack of Transparency Undermines agrees, urging the Commission to 41 See, e.g., Order No. 2003 at P 11–12. Confidence in Open Access and require OASIS posting of service 42 See, e.g., Potomac Economics, Ltd., 2004 State Impedes Enforcement of Open Access metrics, such as all transmission of the Market Report: Midwest ISO at 30–31, 34–35 Requirements requests approved, rejected, confirmed (Jun. 2005) (explaining that the queuing process, by and curtailed. 26. A major focus of comments on the giving customers the opportunity to submit 28. A common theme in the multiple requests for service, provides a low or no- NOI is that increased transparency comments is that the lack of cost option that restricts other customers’ access to would aid transmission customers in transparency can lead to claims of congested interfaces, and the scheduling process, by their participation in the wholesale allowing customers to leave transmission requests undue discrimination and can make market.44 Constellation explains that the unconfirmed, provides a free option that may invite such claims more difficult to resolve.46 hoarding or result in underutilized capacity), http:// transmission provider’s unique position As such, National Grid asserts that www.midwestmarket.org/publish/Document/ as the owner and operator of the _ _ greater transparency will allow the 2b8a32 103ef711180 -7bf20a48324a/ transmission system and often the 2004%20MISO%20SOM%20Report. Commission and transmission system majority of the generation assets in its pdf?action=download&_property=Attachment. users to understand when a 43 control area gives it better information E.g., Calpine, Duke, and MidAmerican. (A list transmission access decision is of commenter acronyms may be found in Appendix than its transmission customers. A). As the Commission noted in Order No. 2000, Moreover, the transmission provider, ‘‘[p]erceptions of discrimination are significant 45 Bonneville urges the Commission to require impediments to competitive markets. Efficient and Constellation argues, has financial load-serving transmission providers to post the competitive markets will develop only if market same information for bundled retail load that they participants have confidence that the system is 44 E.g., LG&E, MidAmerican, Midwest SATs, TDU must post for service to network customers. administered fairly.’’ Order No. 2000 at 31,017. Systems, and Williams. 46 E.g., Ameren, National Grid, and NRECA.

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motivated by a legitimate reason rather congested. Vertically integrated utilities arisen in parts of northern Virginia, and than an intent to discriminate. If do not have an incentive to expand the various load centers in SPP. Still other transmission customers have more grid to accommodate new entry or to constraints are more regional in scope: accurate information about the facilitate the dispatch of more efficient (1) From the Midwest to the Mid- transmission service request process, competitors. Even with the advent of Atlantic, (2) from the Midwest to the National Grid contends, they also will RTOs, transmission infrastructure Tennessee Valley Authority (TVA), (3) have more accurate expectations and a development has not kept pace with the into and within California, (4) from TVA better understanding of how to expedite increase in demand for electricity. and Southern into Entergy, (5) from the implementation of service. Though Transmission capacity is being Mid-America Interconnected Network NRECA agrees that increased constructed at a much slower rate than into Wisconsin-Upper Michigan transparency will allow the Commission the rate of increase in customer demand. Systems, and (6) into Florida. The to deter undue discrimination and Indeed, transmission capacity per MW existence of these and other constraints facilitate accountability, it urges the of peak demand declined at an average affecting transmission systems can Commission to require not just raw data rate of 2.1 percent per year during the result in an increase in the frequency of but meaningful, clear and period 1992 to 2002.49 Investment for denials of requests for transmission understandable data, in a format that the most recent year available, 2003, service, and an increase in the facilitates understanding. was below 1975 levels,50 and frequency of transmission service 29. Commenters urge the Commission projections suggest that this trend will interruptions and/or curtailments of to improve the transparency of continue through 2012.51 As a result, transmission service. While not all transmission service in a number of there has been a significant decrease in congestion needs to be remedied (i.e., if areas, particularly the evaluation of ATC transmission capacity relative to load in the cost of the congestion is less than and the planning of the transmission every NERC region.52 EEI estimates that the cost to relieve it), it is also true that system.47 Another area often cited as capital spending must increase by 25 undue discrimination and preferential lacking sufficient transparency is the percent, from $4 billion annually to $5 treatment also are much more difficult processing of transmission service billion annually, to ensure system to detect when the transmission grid is requests and studies. For example, reliability and to accommodate constrained, given the lack of several commenters note that system wholesale electric markets.53 The legacy transparency in ATC calculations and impact studies are often not completed systems constructed by vertically transmission system planning. Increased within the tariff-prescribed time limits, integrated utilities prior to the adoption congestion also presents additional and that information about that process of Order No. 888 support ‘‘only limited opportunities for undue discrimination. is not available to transmission amounts of inter-regional power flows As a result, it is more difficult for the customers.48 TDU Systems suggests that and transactions. Thus, existing systems Commission to carry out its statutory one way to address the difficulty of cannot fully support all of society’s responsibility to ensure that determining acceptable delays is to goals for a modern electric-power transmission providers provide require transmission providers to post system.’’ 54 These systems were built to nondiscriminatory open access statistics on their OASIS sites providing meet the vertically integrated utilities’ transmission service. information as to the length of time it retail native load obligations, not to 33. In recognition of the lack of might take to process requests for support the development of a bulk adequate infrastructure, a broad cross- transmission service. Cinergy proposes power market. section of the industry supports greater that adopting such reporting metrics 32. Inadequate expansion of the coordination in the planning and could result in an improved quality of transmission grid has contributed to investment in transmission service. increasing transmission congestion in infrastructure between transmission 30. We agree that a lack of most regions of the country. providers, transmission customers and transparency both increases the Transmission congestion has created state regulatory agencies. A major focus potential for undue discrimination and fairly small local load pockets in of comments on our NOI was the need makes it more difficult to detect. We primarily urban areas, e.g., New York to plan and build infrastructure to believe this lack of sufficient City, Long Island, Boston, parts of facilitate regional electricity markets. transparency is caused in part by Connecticut, and the San Francisco Bay For example, AEP argues that the most inadequate compliance with our Area. Other load pocket concerns have important issue faced by public utilities existing OASIS regulations, and in part and their customers is not day-to-day by inadequate transparency 49 Eric Hirst, U.S. Transmission Capacity: Present OATT administration but the planning requirements. Our reforms address both Status and Future Prospects (Aug. 2004), available at http://www.eei.org/industry_issues/ and expansion of the transmission grid. elements of the problem in an effort to energy_infrastructure/transmission/ EEI likewise asserts that the focus increase confidence in open access USTransCapacity10-18-04.pdf (Present Status and should be on the need to develop energy tariffs and to facilitate compliance with Future Prospects). infrastructure necessary to facilitate 50 our regulations and our enforcement of EEI, EEI Survey of Transmission Investment: growth in wholesale electric market them. Historical and Planned Capital Expenditures (1999– 2008) at 3 (May 2005), available at http:// transactions. Santa Clara acknowledges C. Congestion and Inadequate www.eei.org/industry_issues/energy_infrastructure/ that lack of needed infrastructure causes _ _ Infrastructure Development Impede transmission/Trans Survey Web.pdf. the grid to become constrained and less 51 Present Status and Future Prospects at v. reliable, which sometimes provides Customers’ Use of the Grid 52 Brendan Kirby (Oak Ridge National Laboratory, U.S. Department of Energy, Barriers to even stronger incentives for owners to 31. The ability and incentive to restrict access by others. The Nevada discriminate increases as the Transmission Investment, Technical Conference Presentation, (Docket No. AD05–5–000) (April 22, Companies urge the Commission to transmission system becomes more 2005) Transmission Independence and Investment. focus on ways Order No. 888 and the 53 Energy Policy Act of 2005: Hearings before the pro forma OATT can be revised to 47 We discuss these specific aspects of the pro House Subcommittee on Energy and Commerce, forma OATT below in Parts V.A. and V.B. 109th Congress, First Sess. (2005) (Prepared eliminate disincentives to the 48 E.g., Constellation, EPSA, Powerex, and statement of Thomas R. Kuhn, President of EEI). construction of additional transmission Williams. 54 Present Status and Future Prospects at v. facilities. Xcel suggests that the

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Commission focus its efforts on ways to D. A Consistent Method of Measuring amount of remaining transfer capability encourage investment in new energy ATC Has Not Been Established available for other users of the system. 39. As a result of these uncertainties, infrastructure as a way of easing 37. Under Order No. 888, each public the Commission issued the ATC NOI to congestion and enabling growth in utility calculates the amount of transfer address the lack of clear and consistent market transactions. Salt River contends capability on its system that is available methodologies for calculating ATC. In that the Commission should increase for sale to third parties.56 However, the ATC NOI, the Commission incentives to participate in long-term Order No. 888 did not require that the acknowledged that NERC has been regional planning processes. Midwest methodology for ATC calculation be working on specific recommendations SATs argue that increased access for all standardized across the industry, nor for calculating and coordinating ATC transmission system users through did it impose any specific requirements and available flowgate capability policies that promote investment in regarding the disclosure of the (AFC).59 That NERC effort culminated in transmission will do more to reduce methodologies used by each a report and a number of transmission provider. As a result, there undue discrimination than policies that recommendations. The Commission are a variety of ATC calculation seek to uncover and penalize such asked for comments on those methodologies in use today. Moreover, discrimination. recommendations, as well as comments there is often very little transparency 34. Customers also complain that on whether there should be common regarding the nature of these there is often a lack of transparency in transmission calculation methodologies calculations, given that many utility transmission planning processes, among regions. The Commission has transmission providers have filed only reviewed those comments as part of this which the customers claim typically do summary explanations of their ATC proceeding.60 not include economic system upgrades methodologies in Attachment C to the that would benefit non-affiliate users of 40. Many commenters support the OATT. As a result, transmission development of a consistent, industry- the system. Customers also note the lack providers retain unnecessarily broad of clarity in the existing planning wide methodology for calculating discretion in calculating ATC. The 61 obligations required of transmission ATC. These commenters maintain that resulting discretion is a significant a requirement that all transmission providers. They assert that these failures problem because calculation of ATC, have contributed to the inadequate providers use the same methodology to which varies greatly depending on the determine ATC would not only remedy development of the transmission grid. criteria and assumptions used, may the lack of clarity that surrounds these 35. Order No. 888 contemplated that allow the transmission provider to calculations and reservations, but would ISOs would enhance infrastructure discriminate in subtle ways against its provide regulatory certainty and assist development through open and regional competitors. This discretion, coupled transmission customers in predicting planning processes, but these efforts with the lack of transparency, also the outcome of transmission service have stalled in many regions of the hampers the detection of undue requests. country. Even where RTOs have been discrimination and, thereby, 41. We agree. Although the industry established, there have been concerns undermines the Commission’s ability to has sought to pursue greater consistency enforce the general requirement in that the planning process has not always in ATC calculations through existing Order No. 888 that transmission service been sufficiently robust, inclusive or NERC processes, those efforts to date be provided on a not unduly have been largely unsuccessful. The transparent to ensure that transmission discriminatory basis.57 investment occurs where it is lack of a consistent, industry-wide 38. The comments on the NOI and the reasonably needed for all users of the methodology for calculating ATC gives ATC NOI reflect these underlying transmission providers the ability and grid. For example, in its reply problems. Many market participants comments, TDU Systems urges the the opportunity to unduly discriminate complain that there is widespread against third parties. We therefore Commission to include RTOs in its misinformation regarding the actual planning reforms, contending that many propose below a number of reforms to ATC, which results in missed the process of calculating ATC to RTO planning processes are not open to opportunities for transactions. ATC provide clarity and transparency to all stakeholders, nor are they calculation errors often occur. A lack of users of the grid. collaborative and inclusive. Many transparency leaves transmission commenters argue that RTO customers unaware of why some E. A Number of Transmission Pricing transmission planning regimes have transmission requests are granted and Policies May Impede the Use of the Grid failed to get needed transmission others are denied.58 Several ATC inputs, 42. Transmission customers often facilities built.55 such as the capacity benefit margin complain about the level and scope of 36. We conclude that the inadequacy (CBM) or the transmission reliability imbalance charges that are levied under of the existing obligation to conduct margin (TRM), can be calculated using the pro forma OATT and under joint and regional transmission system overly conservative or otherwise faulty individual interconnection agreements. assumptions. Transmission customers planning, coupled with the lack of often complain that transmission 59 transparency surrounding system See NERC, Long-Term AFC/ATC Task Force providers designate unreasonably high Final Report (2005) (NERC Report) at 2, available planning generally, require reform of the _ CBM or TRM levels, which limits the at ftp://www.nerc.com/pub/sys/all updl/mc/ltatf/ pro forma OATT to ensure that LTATF_Final_Report_Revised.pdf. transmission infrastructure is 60 Accordingly, we consolidate Docket No. 56 Order No. 888 at 31,794 n.610. RM05–17–000 with this proceeding. We will constructed on a nondiscriminatory 57 APPA submitted comments in Docket No. distinguish the comments received in the ATC NOI basis and is otherwise sufficient to RM05–17–000 arguing that the calculation and proceeding by the designation ‘‘ATC NOI support reliable and economic service to posting of ATC ‘‘sits at the pivot point among Comments.’’ In addition, we also revise the name all eligible customers. reliability, economic regulation and wholesale of the proceeding in Docket No. RM05–17–000 to electric commerce.’’ APPA at 5. ‘‘Preventing Undue Discrimination and Preference 58 See, e.g., EEI at 18 (agreeing that the in Transmission Service.’’ 55 E.g., APPA, TDU Systems Reply Comments, Commission should require transmission providers 61 E.g., Alcoa, AWEA, Constellation, Exelon, and Williams Reply Comments. to make their ATC calculations more transparent). Occidental, and Renewable Energy.

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Energy imbalance charges, including cost of system expansion. The time and meet the reasonable needs of load- penalties on some systems, are imposed effort required to complete the serving entities to satisfy the service on a transmission customer when the regulatory process appears to inhibit obligations of the load-serving entities, amount of energy scheduled for delivery such reassignments. and enables load-serving entities to to the transmission grid does not equal 45. Although Order No. 888 was secure firm transmission rights* * * on the amount of energy withdrawn by that primarily directed at establishing the a long-term basis for long-term power customer. Customers complain that non-rate terms and conditions of open supply arrangements made, or planned, these charges are excessive and not access, the rule did adopt certain to meet such needs.’’ 65 Although these related to the actual costs incurred by pricing policies that were associated provisions are, or will be, addressed transmission providers. They also argue with the form of open access being primarily in other proceedings, our that the inconsistency between these ordered. After reviewing the comments, NOPR is consistent with these charges in different control areas is we believe certain reforms are provisions because it supports new unnecessary, and that other means of appropriate because some of the pricing infrastructure by reforming the compensating the transmission policies associated with the pro forma transmission planning process to ensure provider, such as return-in-kind, should OATT are no longer just and reasonable that it is open, transparent and be considered. Generator imbalance or are otherwise unduly discriminatory. nondiscriminatory.66 charges are levied on generators for However, we do not intend to pursue 48. Second, Congress emphasized the deviations between the amount of generic reform of other pricing policies need for greater transparency in energy they schedule and the amount that are better addressed on a region-or electricity markets, including they actually deliver to the grid. case-specific basis, such as the pricing transmission service. EPAct 2005 added Generators likewise complain that these of new transmission facilities. section 220 to the FPA, which requires charges are excessive, that transmission the Commission to facilitate ‘‘price providers refuse to credit generators F. EPAct 2005 Emphasized Certain transparency in markets for the sale and with the revenues resulting from Policies and Priorities for the transmission of electric energy in imbalance penalties that are collected, Commission interstate commerce, having due regard and that transmission providers prevent 46. The reforms we propose today for the public interest, the integrity of unaffiliated generators from purchasing also are consistent with the policies and [that market], fair competition, and the or self-supplying generator imbalance priorities embodied in EPAct 2005, in protection of consumers.’’ 67 The services. In addition, owners of which Congress emphasized many of Commission was authorized to intermittent resources complain that the principles reflected in this NOPR. ‘‘prescribe such rules as the generator imbalance penalties, which 47. First, Congress in EPAct 2005 Commission determines necessary and are imposed to provide an incentive for placed special emphasis on the appropriate to carry out the purposes generators to schedule accurately, are development of transmission of’’ FPA section 220. Those rules ‘‘shall inappropriate given their lack of control infrastructure. Congress required the provide for the dissemination, on a and ability to cure deviations. Commission to adopt a rule establishing timely basis, of information about the 43. Transmission providers and incentive-based rates for new availability and prices of wholesale customers raise a number of concerns transmission infrastructure investment. electric energy and transmission service related to the pricing of transmission The stated purpose of new FPA section to the Commission, State commissions, service under Order No. 888, 219 is to benefit ‘‘consumers by buyers and sellers of wholesale electric contending that the Commission’s ensuring reliability and reducing the energy, users of transmission services, pricing policies are in need of reform. cost of delivered power by reducing and the public.’’ Our NOPR similarly For example, under the pro forma transmission congestion.’’ 62 FPA seeks to promote greater transparency in OATT, network customers can receive a section 219 requires the Commission to the provision of transmission service in credit toward their transmission charges ‘‘promot[e] capital investment in the many important areas, including ATC for new facilities that they jointly plan enlargement, improvement, calculation and transmission planning. with the transmission provider. maintenance, and operation of all 49. Finally, Congress emphasized Customers contend that this provision facilities for the transmission of electric compliance with the Commission’s actually acts as a disincentive for joint energy in interstate commerce, regulations, increasing the civil and planning because transmission regardless of the ownership of the criminal penalties for violations of providers can avoid granting credits if facilities.’’ 63 Congress also gave the Commission-administered statutes and they fail to jointly plan with their 68 Commission certain ‘‘backstop’’ regulations. This new authority transmission customers. buttresses the Commission’s efforts to 44. Finally, there is also concern transmission siting authority, and authorized the creation of interstate enforce public utility OATTs and the about the appropriate rate for regulations requiring transmission transmission capacity that has been compacts establishing transmission siting agencies.64 Finally, the information to be posted on OASIS. As resold by the original transmission we explained in the Enforcement Policy customer. Under Order No. 888, such Commission was directed to ‘‘exercise its authority’’ under EPAct 2005 ‘‘in a Statement, however, this new authority capacity may be priced at the higher of carries with it the responsibility to the original rate, the transmission manner that facilitates the planning and expansion of transmission facilities to ensure that enforcement is firm but fair provider’s maximum stated firm rate, or and that our rules are as clear as the assignor’s opportunity costs capped 62 EPAct 2005 sec. 1241 (to be codified at section at the cost of expansion. Customers 219 of the FPA, 16 U.S.C. 824s). The Commission 65 EPAct 2005 sec. 1233(a) (to be codified at complain that this policy does not work issued a NOPR implementing such an incentive rate section. 217(b)(4) of the FPA, 16 U.S.C. 824q). when opportunity costs exceed the program in November 2005. See Promoting 66 We note that we also have proposed to embedded cost rate, because the Transmission Investment through Pricing Reform, implement FPA section 217(b)(4) in a separate assignor must make a FPA section 205 70 FR 71409 (Nov. 29, 2005), FERC Stats. & Regs. rulemaking in Docket No. RM06–8–000. ¶ 32,593 (2005). 67 EPAct 2005 sec. 1281 (to be codified at 16 filing with the Commission that 63 FPA Sec. 219(b)(1). U.S.C. 824t). estimates its opportunity cost over the 64 EPAct 2005 sec. 1221(a) (to be codified at 68 EPAct 2005 sec. 1284(e)(1) (to be codified at term of the reassignment as well as the section 216 of the FPA, 16 U.S.C. 824p). section 316(A) of the FPA, 16 U.S.C. 825o–1 (2000).

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practicable to facilitate compliance.69 or insight into whether a particular • Crediting of Customer-Owned The NOPR is fully consistent with these transmission plan treats all loads and Facilities. We propose to retain most principles because it seeks, in many generators comparably. To ensure that elements of our existing policy areas, to clarify our rules to facilitate truly comparable transmission service is respecting the crediting of customer- compliance by transmission providers. provided by all public utility owned facilities, including the requirement that such facilities meet the IV. Summary, Scope and Applicability transmission providers, including RTOs integration standard. However, we of the Proposed Rule and ISOs, we propose to amend the pro forma OATT to require coordinated, propose to eliminate the requirement 50. This section provides: (1) A open, and transparent transmission that new facilities can receive credits summary of the major components of planning on both a sub-regional and only if they are ‘‘jointly planned’’ the NOPR, (2) a description of the core regional level. To implement this because this requirement may provide a elements of Order No. 888 that we remedy, we propose eight planning disincentive to coordinated planning. propose to retain, and (3) a discussion principles that each public utility Rather, we propose that such new of the applicability of the proposed rule transmission provider will be required facilities be eligible for credits if: (1) to various entities. to follow. We recognize that many Such facilities are integrated into the A. Summary of Proposed Reforms regions have made significant progress operations of the transmission in recent years in creating greater provider’s facilities, and (2) such 51. Consistency and transparency of openness and transparency in facilities would be eligible for inclusion ATC calculations. The Commission transmission planning and believe our in the transmission provider’s annual finds that the lack of a consistent, proposed reforms will build upon, transmission revenue requirement if industry-wide methodology for strengthen, and improve this progress to owned by the transmission provider. calculating ATC, and the lack of 54. Improvements to Point-to-Point adequate transparency in ATC reform transmission planning. 53. Transmission Pricing Reforms. Service. The Commission concludes that calculations, increases the potential for the existing methods for evaluating undue discrimination and also makes Consistent with the focus of Order No. 888 on the non-rate terms and requests for long-term firm point-to- undue discrimination more difficult to point service may no longer be just, detect. The lack of consistent standards conditions of open access, the Commission does not intend to initiate reasonable and not unduly can facilitate undue discrimination by discriminatory. When a transmission giving a transmission provider the broad reform of transmission pricing policy through this NOPR. However, we provider considers a new resource to discretion, and hence the ability and serve native load, the transmission opportunity, to favor itself and its have identified several pricing rules that are part and parcel of OATT service that provider does not eliminate an affiliates over third parties in how it otherwise economic option because the merit reform. calculates and allocates ATC and, resource may not be deliverable in a few • Energy and Generator Imbalance therefore, may be unjust, unreasonable, hours of the year. For transmission unduly discriminatory and preferential. Charges. We find that existing energy customers, however, the transmission As a result, we propose to give the and generator imbalance charges may be provider evaluates whether service can industry specific guidance and a firm excessive and otherwise unrelated to the be granted in every hour of the year that deadline to develop certain cost of providing the service and, is modeled and, if not, it informs the requirements to make the process of therefore, propose to reform energy and customer that service cannot be calculating ATC and the process of generator imbalance pricing. We provided out of existing transfer exchanging data between transmission propose to require that all such capability. Only if the transmission providers about ATC more consistent. In imbalance charges meet the following customer agrees to pay for time- addition, we propose to amend pro criteria: The charges must (1) be related consuming and costly facilities studies forma OATT requirements as well as to the cost of correcting the imbalance, does the transmission provider evaluate our OASIS regulations to increase the (2) be tailored to encourage accurate redispatch options, including whether transparency in how ATC is calculated. scheduling behavior, such as by they are less expensive than the upgrade 52. Requirement for coordinated, increasing the percentage of the adder as options. The Commission proposes to open and transparent transmission the deviations become larger, and (3) address this problem by clarifying that planning. The Commission finds that account for the special circumstances a transmission provider must use all of Order No. 888 does not contain presented by intermittent generators, its available redispatch options to sufficient protections to guard against such as by waiving the higher ends of satisfy a request for firm point-to-point undue discrimination in transmission the deviation penalties. service and, at the transmission system planning. This, in turn, can • Capacity Reassignment Pricing. We customer’s option, these redispatch affect a customer’s ability to obtain find that the existing cap on the options must be studied before the transmission service and the price it reassignment of point-to-point service customer is obligated to incur the costs pays for transmission. Specifically, may no longer be just and reasonable and time delays associated with a Order No. 888 does not require and, therefore, propose to eliminate the facilities study. The Commission also sufficient coordination, openness, and cap. We believe that removing the cap seeks comment on whether this remedy transparency in transmission planning will eliminate an unnecessary is adequate or, alternatively, whether to ensure that new infrastructure is impediment to the resale of capacity, the Commission should modify the constructed to meet the needs of all which in turn should increase nature of point-to-point service to eligible customers on a not unduly utilization of the grid and otherwise require that transmission providers offer discriminatory basis. Without adequate ensure that point-to-point service is just, a ‘‘conditional firm’’ service that would coordination and open participation, reasonable and not unduly be subject to curtailment prior to firm market participants have minimal input discriminatory. We seek comment on service only a limited number of hours this proposal and, in particular, the of the year. 69 Enforcement of Statutes, Orders, Rules and nature of the reporting obligations that 55. Reform of rollover rights. The Regulations, Policy Statement on Enforcement, 113 FERC ¶ 61,068 (2005) (Enforcement Policy should be imposed as part of lifting the Commission concludes that section 2.2 Statement). cap on reassignment. of the pro forma OATT, which grants an

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ongoing right to transmission customers Commission and market participants definition of Good Utility Practice to to renew or ‘‘rollover’’ their contracts, is with information about each reference the definition of ‘‘reliable in need of reform. The Commission transmission provider’s performance of operation’’ adopted in EPAct 2005. proposes to revise that provision to pro forma OATT obligations. For B. Core Elements of Order No. 888 That apply to contracts that have a minimum example, we propose to require Are Retained term of five years, rather than the transmission providers to post specific current minimum term of one year. We performance metrics related to their 59. Although we are proposing many conclude that this reform will ensure completion of studies required under important reforms to Order No. 888 and that the rollover right is enjoyed by the pro forma OATT. We note that the the pro forma OATT, we also wish to transmission customers that have made Commission will continue to audit emphasize that we propose to retain a significant commitment to (and compliance with the pro forma OATT, many of the core elements of Order No. investment in) the transmission grid. In and toward that end propose to require 888. We note that many of these core addition, the Commission proposes that transmission information kept on elements enjoy broad support across a transmission customer eligible for OASIS to be retained for audit purposes many sectors of the industry. In their rollover rights must provide notice of for five years. Finally, we make a comments, APPA, EEI, and NARUC urge whether or not it will exercise its right number of proposals relating to the Commission to proceed carefully in of first refusal to renew the contract no operational penalties assessed under the reforming Order No. 888, focusing on less than one year prior to the expiration pro forma OATT, including so-called incremental reforms not industry date of the transmission service ‘‘over-use’’ penalties, and the treatment restructuring. We share the view that agreement, rather than within the of operational penalty revenues Order No. 888 can be strengthened current 60-day period. collected from transmission providers without discarding its fundamental 56. Increases in transparency to and their affiliates. structure. We discuss below the core lessen the opportunities to discriminate 58. Miscellaneous OATT elements that are being retained and, and reduce transaction costs. In improvements. We propose a number of where appropriate, respond to the addition to the increased transparency improvements to the terms and comments on these points that were we propose to require regarding the conditions of the pro forma OATT to received in the NOI. calculation of ATC and transmission incorporate the lessons learned over the planning, we propose to increase the past ten years. We briefly note these 1. Federal/State Jurisdiction transparency of transmission service below: 60. In Order No. 888, the Commission provided under the pro forma OATT in Hourly Firm. We propose to require stated that it has exclusive jurisdiction several other respects. For example, we transmission providers to offer hourly over the rates, terms and conditions of propose to require transmission firm service under the pro forma OATT. unbundled retail transmission in providers and their network customers Designation of network resources. We interstate commerce.70 Though the to use the transmission provider’s propose to make a number of Commission adopted a test for OASIS to request designation of a new clarifications related to the types of determining which facilities were used network resource and to terminate the agreements that may be designated as for retail transmission, as opposed to designation of an existing network network resources, the process for local distribution to end-users,71 the resource. In addition, we propose to verifying whether agreements meet the Commission stated that it generally require the transmission provider to requirements in the pro forma OATT, would defer to determinations by state modify its OASIS so that requests to and the requirement for transmission regulatory authorities concerning where designate and terminate a network providers to designate and undesignate to draw the jurisdictional line under resource can be queried. We also network resources. We also propose to that test.72 The Commission declined to propose to require the transmission require customers to submit an assert jurisdiction over bundled retail provider to post on its OASIS a list of attestation with each application to transmission, reasoning that ‘‘when its current designated network resources designate a new network resource. transmission is sold at retail as part and and all network customers’ current Reservation priorities. We propose to parcel of the delivered product called designated network resources. Finally, change the priority rules to give priority electric energy, the transaction is a sale we propose to require transmission to pre-confirmed transmission service of electric energy at retail.’’ 73 The U.S. providers to post on OASIS all their requests submitted in the same time Supreme Court affirmed the business rules, practices and standards period. We also propose to add price as Commission’s decision to assert that relate to transmission services a tie-breaker in determining reservation jurisdiction over unbundled but not provided under the pro forma OATT. queue priority when the transmission bundled retail transmission, finding that 57. Strengthening enforcement of the provider is willing to discount the Commission made a statutorily pro forma OATT. Our proposed reforms transmission service. permissible choice.74 include several clarifications of the Clarifications related to network 61. We propose to retain the terms and conditions of the pro forma service. We propose to clarify that a jurisdictional divide we established in OATT that have made undue network customer may not use Order No. 888. We also are mindful of discrimination difficult to detect and secondary network service to bring the need for heightened cooperation otherwise frustrated enforcement of the energy onto its system to support an off- between federal and state regulators in obligation to provide open access, non- system sale if the purchased power does areas where there are overlapping discriminatory transmission service. not displace the customer’s own higher federal and state policy concerns. Our new civil penalty authority under cost generation. We also propose Moreover, our jurisdictional EPAct 2005 gives us ample power to clarifications related to use of network determination was sustained by the U.S. remedy tariff violations, but it also service on an ‘‘as available basis’’ and to places upon us an increased ‘‘redirects’’ of network service. 70 Order No. 888 at 31,781. responsibility to make the rules as clear Definitions. In addition to some minor 71 Id. at 31,771 (setting forth the seven-factor test). as possible. In addition, we propose a revisions, we propose to add a 72 Id. at 31,781. number of posting and reporting definition of ‘‘non-firm sales’’ to the pro 73 Id. requirements that will provide the forma OATT and propose to amend the 74 See New York v. FERC, 535 U.S. 1, 28 (2002).

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Supreme Court and has been accepted providers’ capacity and that Metropolitan Water District contends by industry and state regulatory transmission providers may reserve a that the Commission either should authorities. We see no reason to disturb portion of their capacity for native load reconsider its prior rulings rejecting the that determination now. growth. allocation of physical rights to serve 66. Other commenters perceive native load or should require ISOs and 2. Native Load Protection varying degrees of difference between RTOs to issue financial rights options, 62. Order No. 888 did not require Order No. 888 and FPA section 217.82 in addition to financial right obligations, transmission providers to unbundle EEI states that FPA section 217 extends so that load-serving entities have a transmission service to their retail native load protection to all load-serving greater ability to avoid congestion costs native load nor did it require that entities that have direct or indirect in serving their native load. bundled retail service be taken under service obligations to end-users for the terms of the pro forma OATT.75 terms of one year or more, while Order Discussion Moreover, the Commission allowed a No. 888 does not. Nevada Companies 70. The Commission concludes that transmission provider to reserve, in its and TAPS argue that the FPA section the protection of native load embodied calculation of ATC, transmission 217 requirement that the Commission in Order No. 888 is consistent with FPA capacity necessary to accommodate exercise its authority to facilitate the section 217, and we reaffirm our native load growth reasonably planning and expansion of transmission commitment to the protection of native forecasted in its planning horizon.76 As facilities to satisfy the service load. Order No. 888 gave public utilities noted above, Order No. 888 granted a obligations of load-serving entities the right to reserve existing transmission rollover right to existing firm service necessitates changes to Order No. 888. capacity needed for native load growth customers,77 but allowed transmission 67. Several commenters argue that reasonably forecasted within the providers to restrict that rollover right if FPA section 217 requires the utility’s current planning horizon. It the capacity was reasonably forecasted Commission to revisit its rollover rights also allowed transmission providers to to be needed to serve native load policy.83 Duke maintains that the restrict rollover rights based on a customers, as long as that restriction current Commission approach is not the reasonably forecasted need at the time was specified in the customer’s service same as set forth in either Order No. 888 the contract is executed. This approach 78 contract. or FPA section 217 because the is consistent with FPA section 217, 63. Congress in section 1233 of EPAct Commission’s current approach to which protects the transmission rights 2005 added section 217 to the FPA, rollover rights does not meaningfully of entities with service obligations to entitled ‘‘Native Load Service recognize the native load preference. end-users or a distribution utility, to the Obligation,’’ which addresses Commission decisions since Order No. extent required to meet their service transmission rights held by load-serving 888, according to Duke, have weakened obligations. Though commenters appear entities. It allows load-serving entities to the native load preference envisioned in to believe FPA section 217 would use their own and contracted-for Order No. 888 to the point where the support the cancellation of contracts transmission capacity to the extent Commission’s treatment of the native that include rollover rights, FPA section required to meet their service load preference is not what Congress 217 by its terms does not contemplate obligations, without being subject to provides in FPA section 217. LPPC abrogation of existing transmission charges of unlawful discrimination. argues that FPA section 217 reverses service contracts.84 However, to the Among other things, FPA section 217 Commission precedent that makes it extent commenters argue that the terms states that it does not require the impossible to recall capacity for native of service and notice periods associated abrogation of any contract or service load once it is subject to a rollover right. with the OATT rollover rights are too agreement for firm transmission service 68. EEI states that in order to short to protect native load adequately, or rights in effect as of the date of harmonize Order No. 888 rollover rights we note that we are proposing to extend enactment.79 64. In the NOI, the Commission stated with the native load protections them in this NOPR. 71. In response to Metropolitan Water that it was not proposing to change the contained in FPA section 217, the District, the Commission finds that the protection of native load embodied in Commission should revise the pro issue of firm transmission rights in Order No. 888.80 The Commission forma OATT to require a notice period organized markets is best addressed as sought comment on whether the for rollover rights that is consistent with part of the long-term firm transmission approach the Commission took in Order the time needed to plan for and rights rulemaking in Docket Nos. RM06– No. 888 is the same as that set forth in construct transmission facilities to serve 8–000 and AD05–7–000. We further FPA section 217. native load customers and the rollover customer. EEI and Salt River argue that note, in response to the comments of Comments FPA section 217 requires that the Nevada Companies and TAPS, that we 65. Several commenters argue that the Commission permit load-serving entities are proposing a coordinated and approach the Commission took in Order to implement curtailment procedures regional planning process to facilitate No. 888 is largely consistent with the that recognize native load service the planning and expansion of treatment of native load preference in priorities. transmission facilities pursuant to FPA FPA section 217.81 They state that Order 69. Metropolitan Water District argues section 217. that the mandate to preserve native load No. 888 makes clear that native load has 3. The Types of Transmission Services a priority right to a transmission preference is complicated further when a transmission owner has transferred Offered 75 Order No. 888 at 31,745. operational control to an ISO or RTO. In 72. In Order No. 888, the Commission 76 Id. at 31,694. such a scenario, to honor the native load required all public utilities to offer on 77 Id.; pro forma OATT section 2.2. preference in FPA section 217, a non-discriminatory, open-access basis 78 Order No. 888–A at 30,198. firm network service and firm and non- 79 16 U.S.C. 217(f). 82 E.g., Duke, EEI, Metropolitan Water District, 80 NOI at P 9. and Southern. 84 See FPA section 217(f) (explaining that section 81 E.g., Memphis Light, Newmont Mining Reply 83 E.g., Duke, Energy, LPPC, Progress Energy, Salt 217 does not abrogate any firm service agreements Comments, Progress Energy, and TDU Systems. River, Santee Cooper, and Southern. or rights in effect as of the date of enactment).

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firm point-to-point service. In the NOI, AMP-Ohio argues that, as long as limited to situations in which the Commission sought comments on Commission policy requires network deliverability is physically limited, such whether the Commission should require customers to pay load-ratio network as where the integrated transmission transmission providers to offer transmission charges for load served system does not have the capacity to transmission services in addition to, or with behind-the-meter generation, serve all the load at a designated point in place of, the point-to-point and contract demand network service is of delivery. EEI argues that the network services prescribed in the essential to avoid unduly discriminatory Commission should not convert OATT. transmission charges. Midwest network service to network contract 73. Among other questions, the Municipals and FMPA argue that the demand service because conversion Commission asked whether network Commission should order contract would result in a substantial reduction service alone or both network and point- demand service where the transmission in ATC as it would provide contract to-point services should be converted provider does not plan and operate its rights on the transmission system on an into a single contract demand service.85 system to meet total customer load around-the-clock basis that are equal to Generally speaking, contract demand because, as the Commission stated in network load’s monthly or annual peak service is a hybrid of point-to-point and Order No. 888, full network service is loads. essential for achieving comparability network services that is reservation- Discussion based and allows transmission and efficient integration of power customers to receive a firm entitlement supply and load. FMPA contends that 78. We propose to retain the services to integrate multiple resources and where a customer needs network service we ordered in Order No. 888: firm and deliver energy to multiple points, from another system for only part of its non-firm point-to-point service and firm without paying a separate charge for load, it would benefit from being able to network service. We do not propose each point of receipt or delivery. buy system power from multiple requiring transmission providers to Contract demand service would allow designated resources for part of its load. adopt a network contract demand current point-to-point customers to In this way, FMPA continues, the service, either as a replacement for avoid having to arrange and pay for transmission provider would not have network or point-to-point service or as separate reservations for each point of the planning obligation for the a third category of service under the receipt. And current network customers customer’s entire load, perhaps avoiding OATT. The Commission continues to would be allowed to pay for or delaying expensive transmission believe that network and point-to-point transmission based on the amount of additions. FMPA claims that such services are the appropriate base-line their reservation rather than customer service would tend to benefit all service offerings in the OATT. Although loads at a delivery point. transmission users because it would forms of contract demand service have allow a more efficient use of the grid been approved by the Commission, and Comments and provide additional transmission the service may provide benefits to 74. Most commenters argue against revenues. certain customers, sufficient potential requiring that network service alone or 76. Other commenters state that drawbacks exist that prevent us from in combination with point-to-point transmission providers should have the concluding that it is a necessary service be converted into contract option whether to offer contract demand transmission service that should be demand service.86 Some warn that the or other customized transmission included in the pro forma OATT. For imposition of this service would services.89 LPPC argues that the example, the service would require a interfere with efficient transmission Commission should allow a departure from full load-ratio pricing for system planning and operation due to transmission provider to voluntarily network customers, which may not be increased capacity reservations that provide alternative forms of warranted to the extent the transmission would go unused.87 They also argue that transmission service where provider plans its system to serve all it would result in significant cost shifts circumstances support their native load. While the Commission among transmission customers if not implementation, with the caveat that concludes that it will not require all priced correctly. FP&L argues that the such service must not place any market transmission providers to offer this current services are a better match for participant at a disadvantage or increase service, we acknowledge that the the actual use of the transmission transmission rates for network or point- introduction of this service on a system and thereby permit more ATC to to-point customers. Southern proposes voluntary basis may be appropriate in certain circumstances. be available. that the pro forma OATT be modified to 79. Although we are not proposing to 75. Some commenters ask that the include a process through which a require that transmission providers Commission require transmission transmission provider may propose to adopt contract demand service, we note providers to offer contract demand adopt new services that customers that the commenters who support this service as an additional transmission specifically request. service appear concerned principally service option in the pro forma OATT.88 77. Commenters also raise general concerns regarding the use and potential with inequities in the pricing of network integration service. The Commission is 85 For examples of contract demand service, the abuse of network contract demand Commission cited Florida Power Corp., FERC service. For example, MidAmerican addressing certain of these concerns ¶ 61,248 (1995); Wisconsin Electric Power Co., 72 argues that contract demand service elsewhere in the NOPR. For example, in FERC ¶ 61,033 (1995); and Florida Power Corp., 81 should not be used as a means for this NOPR, we propose to modify our FERC ¶ 61,247 (1997). transmission customers with behind- treatment of transmission credits for 86 E.g., Ameren, APPA, Bonneville, Calpine, EEI, EPSA, Fallon Reply Comments, FP&L, NRECA, the-meter generation to avoid paying for new transmission facilities and clarify PacifiCorp, Southern, Suez Energy NA, TVA, TAPS, a load-ratio share of a system that was that the transmission provider must and TDU Systems. built to support their entire load and on satisfy the comparability requirement 87 E.g., EEI, FP&L, KCP&L, and TVA. which they rely for service. Rather, when including transmission facilities 88 E.g., AMP-Ohio, APPA, Cogeneration MidAmerican continues, network in its rate base for pro forma OATT Association of California Reply Comments, Constellation, EPSA, FMPA Reply Comments, contract demand service should be purposes. We also address concerns Midwest Municipals, PacifiCorp, and Public Power regarding the linkage between how the Council. 89 E.g., LPPC, NRECA, and Southern. transmission provider plans and

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operates its system through proposed good by threatening the continued These rules require that employees revisions to planning and ATC. economic operation of those utilities engaged in transmission functions that continue to provide bundled operate separately from employees of 4. Functional Unbundling service to their retail native load energy affiliates and marketing affiliates. 80. When the Commission proposed customers. The North Carolina A number of information sharing the open access policy that culminated Commission does not believe the restrictions also apply, which prohibit in Order No. 888, there was evidence in that state supports the transmission providers from allowing considerable debate about whether imposition of structural remedies. employees of their energy and corporate unbundling (in which a 83. Some commenters, however, marketing affiliates to obtain access to public utility’s transmission and continue to urge the Commission to transmission or customer information, generation assets would be placed in impose structural separation. National except via OASIS. separate corporate entities) was Grid contends that the best way to 86. The Commission aggressively necessary to ensure non-discriminatory eliminate the possibility of undue enforces the Standards of Conduct. The open access transmission service. The discrimination is to separate the Commission’s Office of Enforcement is Commission decided to mandate ownership and operation of the well-suited to investigate potential functional, rather than corporate, transmission system from interests in violations of the Standards of Conduct unbundling of transmission and the market. Calpine urges the and to propose remedies, including generation services. In Order No. 888, Commission to structurally separate the structural remedies if necessary, to the Commission explained that merchant function that is engaged in ensure that the separation of function functional unbundling has three selling power for resale from those who and information restrictions in Order components: control access to transfer capability and No. 2004 are implemented. service, not just those who operate the 1. A public utility must take transmission 87. The Commission has resolved a services (including ancillary services) for all transmission system. TAPS argues that number of complaints related to the of its new wholesale sales and purchases of structural solutions are preferable to Standards of Conduct and the energy under the same tariff of general behavioral rules. accompanying OASIS posting applicability as do others; 84. Many commenters favoring requirements.95 In Order No. 888, the 2. A public utility must state separate rates structural separation urge the Commission noted that the possibility of for wholesale generation, transmission, and Commission to impose an independent filing a complaint under FPA section ancillary services; transmission coordinator requirement. 206 is an additional safeguard if a 3. A public utility must rely on the same These commenters would have public utility seeks to circumvent the electronic information network that its transmission providers employ an functional unbundling requirement. The transmission customers rely on to obtain independent entity to administer their information about its transmission system Commission’s Enforcement Hotline when buying or selling power.90 OATTs, performing such functions as likewise is available to customers that maintaining the utility’s OASIS, do not wish to file a formal complaint. 81. In the years following Order No. granting or denying service requests, 88. In addition, one of the criticisms 888, a number of public utilities reviewing system impact and facilities of the functional unbundling nonetheless underwent corporate study results, and overseeing decisions requirement is that Order No. 888 leaves unbundling. Many of these entities did with respect to line ratings, vertically integrated utilities with too so as a result of state-mandated transmission outages and generation much discretion in applying the OATT restructuring laws. Others did so for dispatch.91 Other commenters oppose and gives them an incentive to use this corporate or tax reasons. Some entities the imposition of a potentially costly discretion to their advantage. We agree divested all of their generation assets to new layer of bureaucracy, at least on a that the existing pro forma OATT a non-affiliate, while others simply generic basis.92 provides too much discretion in certain restructured internally to place the Discussion important areas. It is for this reason—as generation assets in a different corporate explained elsewhere in the NOPR—that subsidiary than the transmission assets. 85. We propose to preserve the we are proposing to require greater There remain, however, a significant functional unbundling approach clarity and transparency in several areas number of vertically-integrated public adopted by Order No. 888. For public of OATT administration. We believe utilities that have operated under the utilities that kept transmission and these reforms will limit the discretion of functional unbundling approach. generation assets in the same corporate transmission providers and make any entity, the Commission imposed strict Comments remaining attempts to discriminate Standards of Conduct that required much easier to detect. 82. Retention of Order No. 888’s separation of the utilities’ transmission 89. We believe that this increased functional unbundling approach is system operations and wholesale clarity and transparency, when coupled 93 supported by a number of commenters. marketing functions. These Standards with the Standards of Conduct and a For example, the LPPC states that of Conduct were replaced by a broader rigorous enforcement program, will 94 vertical integration remains a viable set of rules adopted in Order No. 2004. ensure that the functional unbundling business model for serving customers requirement will serve its original 91 reliably and at economic rates. LG&E E.g., Arkansas Commission, Calpine, purpose. As a result, just as the posits that, absent a proven and real Constellation, EPSA, and PPL. 92 Commission concluded in Order No. level of abuse, major structural changes E.g., APPA, NRECA, and TAPS. 93 are unwarranted. NARUC argues that Order No. 889 at 31,595. 94 See Standards of Conduct for Transmission Order No. 2004–D, 110 FERC ¶ 61,320 (2005), the issue of whether there should be Providers, Order No. 2004, 68 FR 69134 (Dec. 11, appeal docketed sub nom. National Gas Fuel structural separation of generation from 2003), FERC Stats. & Regs. ¶ 31,155 (2003), order Supply Corporation v. FERC, No. 04–1183 (D.C. Cir. transmission is best left to the states. on reh’g, Order No. 2004–A, 69 FR 23562 (Apr. 29, June 9, 2004), codified at 18 CFR Part 358 (2005). NPPD alleges that mandatory vertical 2004), FERC Stats. & Regs. ¶ 31,161 (2004), order 95 See Aquila Energy Marketing Corp. v. Niagara on reh’g, Order No. 2004–B, 69 FR 28371 (Aug. 10, Mohawk Power Corp., 87 FERC ¶ 61,328 unbundling would do more harm than 2004), FERC Stats. & Regs. ¶31,166 (2004), order on (1999)(finding that off-OASIS communicagtion reh’g, Order No. 2004–C, 70 FR 284 (Jan. 4, 2005), between utilty and its marketing affiliate led to 90 Order No. 888 at 31,654. FERC Stats. & Regs. ¶ 31,172 (2005), order on reh’g, preferential treatment of the affiliate).

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888 that more intrusive and costly provider to justify variations from the to submit compliance filings upon corporate unbundling was not non-price terms and conditions of the issuance of the new pro forma OATT necessary, the Commission again pro forma OATT under two but allow them to propose waivers of concludes that there is no need to circumstances. First, certain provisions the new requirements based upon impose a corporate or structural of Order No. 888 specifically allowed appropriate justification. unbundling requirement at this time. public utilities to use alternatives that 96. EEI argues that, to the extent that We believe that the pro forma OATT, if were justified by ‘‘regional differences.’’ the Commission requires RTOs and properly clarified and enforced, will When submitting those provisions, ISOs to amend their open access enable us to eliminate the opportunity public utilities were permitted to follow transmission tariffs, the Commission for undue discrimination in the regional practices when doing so was should establish flexible procedures that provision of transmission service. ‘‘reasonable, generally accepted in the provide the RTOs and ISOs the right to 90. For the same reasons, we also region, and consistently adhered to by customize their OATTs consistent with decline to mandate an independent the transmission provider,’’98 as long as their independent status. transmission coordinator for all the utilities identified the regional 97. Other commenters argue that transmission providers. We have practices in their compliance filings. reforms to existing OATTs should be concluded that such entities may be Second, in subsequent FPA section 205 applied to all market entities, including appropriate in certain circumstances proceedings, public utilities were ISOs, RTOs and independent 99 and we support voluntary efforts to rely permitted to propose changes to any pro transmission coordinators. LPPC on them.96 We do not agree, however, forma OATT provision that were states that there is little reason for the that there is sufficient basis for requiring ‘‘consistent with or superior to’’ the Commission to be more deferential in them as a generic remedy for undue terms of the pro forma OATT. considering deviations from the pro discrimination. 93. In the NOI, the Commission forma OATT proposed by RTOs or ISOs 91. Our proposal to retain the expressed the preliminary view that than it is with respect to investor-owned functional unbundling approach of reforms to the pro forma OATT and utilities. Order No. 888 does not suggest, public utilities’ OATTs appear Discussion however, a lack of support for structural necessary and sought comment on how best to accomplish that. In particular, 98. The Commission proposes to changes that may be undertaken on a apply the final rule to all public utility voluntary basis by each region, such as the Commission sought comment on whether reforms to Order No. 888 transmission providers. The transmission-only companies, RTOs, or Commission proposes to require all other reforms. We continue to support should be applied to all public utility transmission providers, including those such transmission providers to submit such efforts as potentially providing FPA section 206 compliance filings, significant benefits in several areas, that are approved ISOs, RTOs, or independent transmission coordinators. within 60 days following publication of including, but not limited to, increased the final rule in the Federal Register, infrastructure investment and Comments that contain the non-rate terms and addressing regional issues such as cost 94. Independent system operators conditions set forth in the final rule. We recovery, pancaked rates, loop flow, and such as MISO, CAISO, and ISO New note that certain non-rate terms and congestion management. At this time, England submit that many of the conditions, such as Attachment C we believe such efforts are best concerns raised by the Commission in relating to the transmission provider’s developed on a voluntary basis. the NOI already have successfully been ATC calculation methodology and C. Applicability of the Proposed Rule addressed by the operation of ISOs and Attachment K relating to the RTOs. Similarly, EEI argues that many transmission provider’s transmission 1. Public Utility Transmission Providers of the issues addressed in the NOI are planning process, may require more 92. Pursuant to its authority under not applicable to RTOs and ISOs than 60 days to prepare. We seek FPA sections 205 and 206, the because RTOs and ISOs are independent comment on an appropriate time period Commission in Order No. 888 required of all market participants and therefore in which to require the submission of all public utilities that owned, are presumed to not engage in undue these attachments. controlled, or operated facilities used discrimination or preferential treatment. 99. As we did in Order No. 888, after for transmitting electric energy in PJM argues that, because of its making their FPA section 206 interstate commerce to file open access independence, the transparency of its compliance filings, we propose to allow transmission tariffs that contained procedures, and the progress achieved transmission providers to submit filings minimum terms and conditions of non- in developing effective financial and under FPA section 205 proposing rates discriminatory service. The Commission non-financial congestion management for the services provided for in the tariff recognized, however, that there may be tools, PJM structurally addresses the as well as non-rate terms and conditions circumstances in which a public utility continuing concerns of the Commission that differ from those set forth in the believes that the pro forma OATT does regarding persistent undue final rule if those provisions are not provide sufficient flexibility.97 In discrimination and preference in the ‘‘consistent with or superior to’’ the pro addition, the Commission industry. forma OATT. acknowledged that a public utility 95. EPSA states that it may not be 100. With respect to an RTO or ISO, might be willing to offer superior non- necessary to apply all aspects of the new we recognize that such an entity may rate terms and conditions. As a result, OATT to ISOs or RTOs. However, rather already have tariff terms and conditions the Commission allowed a transmission than delineating either each term that that are superior to the pro forma would not apply to an RTO or how such OATT. Thus, we propose to require 96 See Duke Power, 113 FERC ¶ 61,288 (2005); terms might be modified in an RTO RTO and ISO transmission providers to MidAmerican Energy Co., 113 FERC ¶ 61,274 tariff, EPSA recommends that the submit FPA section 206 compliance (2005); see also Entergy Services, Inc., 110 FERC Commission require RTOs, ISOs, and filings, within 90 days following ¶ 61,295 (2005), order clarificaiton, 111 FERC ¶ 61,222 (2005), order conditionally approving independent transmission coordinators publication of the final rule in the filing, 115 FERC ¶ 61,095 (2006). 97 Order No. 888 at 31,770. 98 Id. 99E.g., Calpine, LPPC, NRECA, and Santa Clara.

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Federal Register, that contain the non- transmission facilities must provide seeking enforcement, or sua sponte rate terms and conditions set forth in comparable transmission service that it action by the Commission. the final rule or that demonstrate that is capable of providing on its own Comments their existing tariff provisions are system. Under the OATT, a public consistent with or superior to the utility may refuse to provide open 106. Several non-public utility revised provisions to the pro forma access transmission service to a non- commenters suggest that the OATT. Similarly, after making their public utility if the non-public utility Commission should not use the FPA section 206 compliance filings, we refuses to reciprocate. A non-public authority granted by FPA section 211A propose to allow RTOs and ISOs to utility may satisfy the reciprocity in a generic fashion.102 They argue that submit filings under FPA section 205 condition in one of three ways: first, it there is no need to require unregulated proposing rates for the services may provide service under a tariff that transmitting utilities either to file open provided for in their tariffs as well as has been approved by the Commission access tariffs with the Commission or to non-rate terms and conditions that differ under the voluntary ‘‘safe harbor’’ require that they adhere to a pro forma from their existing tariffs and those set provision. A non-public utility using OATT. APPA asserts that while the forth in the final rule if those provisions this alternative submits a reciprocity Commission may act under FPA section are ‘‘consistent with or superior to’’ the tariff to the Commission seeking a 211A to remedy particular issues that pro forma OATT. declaratory order that the proposed are brought to its attention with respect 101. We generally note that the reciprocity tariff substantially conforms to lack of access, there is simply no purpose of this NOPR is not to redesign to, or is superior to, the pro forma basis for concluding that there currently approved, fully-functional RTO or ISO OATT. The non-public utility then must exists a general problem regarding the markets. We do not expect that offer service under its reciprocity tariff provision of transmission service by substantial changes to those markets to any public utility whose transmission non-public utility transmission would be required as a result of this service the non-public utility seeks to providers which calls for a generic NOPR. For example, some RTOs or ISOs use. Second, the non-public utility may solution. LPPC proposes a regime of have eliminated point-to-point service provide service to a public utility under voluntary compliance with a set of for internal transactions in favor of a a bilateral agreement that satisfies its proposed comparability guidelines. form of more flexible network service. reciprocity obligation. Finally, the non- 107. Many commenters argue that the Thus, we would not expect our reforms public utility may seek a waiver of the Commission should exercise its to ATC to require changes to the way in reciprocity condition from the public authority granted by FPA section 211A which such RTOs or ISOs assess utility.101 by establishing a rule to require whether capacity for traditional network 104. In EPAct 2005, Congress unregulated transmitting utilities to or point-to-point service is available authorized, but did not require, the provide service under the pro forma within their footprints. However, there Commission to order non-public OATT.103 EEI believes a rulemaking is may be elements of the proposed utilities (or ‘‘unregulated transmitting essential to ensure that all utilities reforms that are superior to what utilities’’) to provide transmission required to provide open access under currently exists in some RTOs or ISOs, services. Section 1231 of EPAct 2005 FPA section 211A do so and that the e.g., transparency, data exchange or establishes a new section 211A in Part Commission should, at a minimum, planning, which would require the RTO II of the FPA, which states in part that require unregulated transmitting or ISO to conform to the pro forma the Commission ‘‘may, by rule or order, utilities to file and provide service OATT. require an unregulated transmitting under the pro forma OATT. EPSA and utility to provide transmission services’’ Sempra Global suggest an approach that 2. Non-Public Utility Transmission at rates that are comparable to those it would not require an unregulated Providers/Reciprocity charges itself and under terms and transmitting utility to file an OATT with 102. In Order No. 888, the conditions (unrelated to rates) that are the Commission until it receives a Commission conditioned non-public comparable to those it applies to itself request for service. utilities’ use of public utility open and that are not unduly discriminatory 108. EEI argues that the Commission access services on an agreement to offer or preferential. The language does not should use FPA section 211A to require comparable transmission services in limit the Commission to ordering unregulated transmitting utilities to return.100 The Commission found that transmission services only to the public provide all services they are capable of while it did not have the authority to utility from whom the non-public utility providing, not just those that they require non-public utilities to make takes transmission services, but rather it provide to themselves. In contrast, their systems generally available, it did can reasonably be read to permit the APPA states that FPA section 211A have the ability and the obligation to Commission to order the non-public establishes a ‘‘comparability’’ standard ensure that open access transmission is utility to provide ‘‘open access’’ applicable to non-public utility as widely available as possible and that transmission service, i.e., service to all transmission owner rates, and a Order No. 888 did not result in a eligible customers. ‘‘comparable and not unduly competitive disadvantage to public 105. In the NOI, we sought comment discriminatory or preferential’’ standard utilities. on whether the Commission should for terms and conditions. APPA further 103. Under the reciprocity provision exercise the authority granted to it by states that FPA section 211A requires in section 6 of the pro forma OATT, if Congress in FPA section 211A. If so, we that unregulated transmitting utilities a public utility seeks transmission asked whether the Commission should provide transmission service to others at service from a non-public utility to impose this requirement on all which it provides open access unregulated transmitting utilities 102 E.g., Chelan, Douglas, LDWP, LPPC, Northwest transmission service, the non-public through a rulemaking proceeding, or Unregulated TUs, Public Power Council, Rural Utilities Service, Sacramento, Santee Cooper, utility that owns, controls, or operates whether the Commission should instead apply this new law on a case-by-case Snohomish, Tacoma, TAPS, and TVA. 103 E.g., Ameren, California Commission, Calpine, 100 These entities are not FPA public utilities and basis, through complaints, motions Cinergy, EEI, First Energy, Memphis Light, Nevada therefore are not subject to the Commission’s Companies, Northwest IPPs, PNM–TNMP, PPL, jurisdiction under sections 205 and 206 of the FPA. 101 See Order No. 888–A at 30,285–86. Progress Energy, and Suez Energy NA.

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rates, terms and conditions ‘‘comparable 111. We do not propose a generic rule consistent, industry-wide method for to those under which the unregulated to implement the new FPA section calculating it.108 Instead of prescribing a transmitting utility provides 211A.105 Rather, we will apply its specific methodology for calculating transmission services to itself,’’ rather provisions on a case-by-case basis, such ATC in Order Nos. 888 and 889, the than transmission services that they are as when a public utility seeks service Commission encouraged the industry ‘‘reasonably capable of providing.’’ from an unregulated transmitting utility efforts and required that transmission 109. The Canadian Electricity that has not requested service under the providers base their ATC calculation Association believes that the adoption public utility’s OATT and the methodologies on current industry of FPA section 211A requires the reciprocity obligation therefore does not practices, standards and criteria.109 In 106 Commission to revisit the reciprocity apply. A customer may file an addition, the Commission directed requirement of Order No. 888. application with the Commission transmission providers to include a According to the Canadian Electricity seeking an order compelling the description of their ATC calculation Association, EPAct 2005 lowered the unregulated transmitting utility to methodologies in Attachment C of their bar for domestic unregulated provide transmission service that meets tariffs. transmitting utilities, requiring them the standards of FPA section 211A. only to provide service under terms and Further, as we indicate below, we 114. Ten years later, however, conditions that are comparable to those expect unregulated transmission although some progress has been made, they apply to themselves, rather than providers to participate in the open and the industry still has not developed a terms and conditions that substantially transparent regional planning processes consistent, industry-wide methodology conform or are superior to those in the that we propose to order and note that, for evaluating ATC. In the intervening pro forma OATT. If the Commission if there are complaints about such years, the industry, working through the does not make corresponding changes to participation, we will address them on North American Electric Reliability the manner in which the reciprocity a case-by-case basis. Council (NERC), has adopted a general requirement currently applies to 112. We disagree with the position of definition of ATC, which establishes a Canadian entities, it argues, the result the Canadian Electricity Association. basic methodology for evaluating ATC. will be domestic unregulated EPAct 2005 did not repeal the NERC also has developed a set of transmitting utilities being treated better reciprocity obligation in Order No. 888. guiding principles for calculating ATC than Canadian entities, which would Rather, it granted a new avenue of and has encouraged further consistency violate the national treatment authority to the Commission to order of ATC calculation methodologies on a obligations under the North American comparable transmission service from regional level. NERC defines ATC as the Free Trade Agreement. The Canadian non-public utilities. We are proposing transfer capability remaining on the Electricity Association argues that the not to exercise this new authority at this system for further commercial activity reciprocity requirement under Order time. Rather, we are proposing to retain over and above already committed uses. No. 888 must be modified to require that our reciprocity policy, which was This value is determined by deducting a Canadian entity that seeks open access adopted pursuant to sections 205 and existing transmission commitments in the U.S. must provide access to its 206 of the FPA. By maintaining the (ETC) 110 (including transmission own transmission system under terms same reciprocity requirement for reservations, network and retail and conditions that are comparable to domestic, non-public utilities as for customer service), capacity benefit those the Canadian entity is subject to foreign utilities doing business in the margin (CBM),111 and transmission itself. United States, the Commission will 112 ensure that foreign entities will reliability margin (TRM) from total Discussion continue to be treated no less favorably 110. The Commission proposes to than domestic, non-public utilities. 108 Order No. 889 at 31,607. retain the current reciprocity language 109 Id. in the pro forma OATT, as well as Order V. Proposed Modifications of the OATT 110 NERC does not have a formal definition or standard methodology for ETC. No. 888’s three alternative provisions A. Consistency and Transparency of 111 NERC defines CBM as the amount of firm for satisfying the reciprocity condition, ATC Calculations transmission transfer capability preserved by the which are described above: a non-public transmission provider for load-serving entities, 113. In Order Nos. 888 and 889, the utility that owns, controls, or operates whose loads are located on that transmission Commission directed transmission transmission and seeks transmission service provider’s system, to enable access by the providers to offer their unused transfer load-serving entities to generation from service from a public utility must either capability to the market and to post the interconnected systems to meet generation satisfy its reciprocity obligation under a reliability requirements. Preservation of CBM for a amount of ATC 107 on OASIS. At the bilateral agreement, seek a waiver of the load-serving entity allows that entity to reduce its time those orders were issued, the OATT reciprocity condition from the installed generating capacity below that which may Commission noted that formal methods otherwise have been necessary without public utility, or file a safe harbor tariff did not exist for calculating ATC, but interconnections to meet its generation reliability with the Commission.104 requirements. The transmission transfer capability recognized that there were industry preserved as CBM is intended to be used by the efforts underway to develop a 104 For non-public utilities that choose to use the load-serving entities only in times of emergency safe harbor tariff, we note that its provisions must generation deficiencies. See North American be substantially conforming or superior to the new 105 We note that LPPC has committed to voluntary Electric Reliability Council, Glossary of Terms Used pro forma OATT. A non-public utility that already compliance with a set of guidelines for the in Reliability Standards, (Effective April 1, 2005), has a safe harbor tariff may amend its tariff so that provision of comparable service under FPA section (NERC Glossary) available at _ its provisions substantially conform or are superior 211A. ftp://www.nerc.com/pub/sys/all updl/standards/ _ to the new pro forma OATT if it wishes to continue 106 We do, however, propose to amend our sar/Glossary 07Feb06.pdf. to qualify for safe harbor treatment. As the regulations to make clear that an applicant in a FPA 112 NERC defines TRM as the amount of Commission stated in Order No. 888–A, a non- section 211A proceeding against a non-public transmission transfer capability necessary to public utility may limit the use of its voluntarily utility that has submitted an acceptable safe harbor provide reasonable assurance that the offered safe harbor reciprocity tariff only to those tariff shall have the burden of proof to show why interconnected transmission network will be transmission providers from whom the non-public service under the safe harbor tariff is not sufficient secure. TRM accounts for the inherent uncertainty utility obtains open access service, as long as the and why a FPA section 211A order should be in system conditions and the need for operating tariff otherwise substantially conforms to the pro granted. See revised 18 CFR 35.28(e)(1)(ii). flexibility to ensure reliable system operation as forma OATT. See Order No. 888–A at 30,289. 107 See supra note 7. system conditions change. See NERC Glossary.

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transfer capability (TTC).113 However, assumptions are used. Without a realistically expected to occur. This NERC’s calculation methodology is not consistent and transparent approach to could happen if a transmission provider prescriptive; it establishes a framework evaluating ATC, transmission customers includes in ETC excess capacity for a for evaluating ATC, which leaves open will remain wary when service is load-serving entity (such as capacity to to each transmission provider’s denied and transmission providers will meet generation reserve requirements) interpretation and discretion the be the subject of suspicion and but then also has a CBM component in specific algorithm, data inputs and heightened scrutiny, especially given its calculation of ATC that includes the assumptions needed to assess ATC.114 the increasingly congested state of the same capacity. A transmission provider Consequently, transmission providers Nation’s electric grid. also could overestimate its ETC by have developed numerous ways to double-counting the same transmission Consistency evaluate ATC using their own reservations in its ATC calculation. For algorithms, data and modeling 116. Generally, transmission example, this could happen if a assumptions.115 providers calculate ATC by creating a transmission provider fails to replace a 115. Although transmission providers base model of their system using a set transmission reservation with the across the Nation have developed of data inputs and assumptions, which associated real-time schedule, and as a various methodologies, in general, there are determined by the transmission result does not release non-firm ATC. A are two main approaches to calculating provider. The transmission provider consistent process for calculating ETC ATC used in the industry. The first is uses the model to perform various will limit the subjectivity of the the contract path approach, which is computer simulations of the operations transmission provider’s decisions and more commonly used by transmission of its system to determine the levels of provide a more uniform method for providers in the Western Electricity transfer capability available on the estimating ETC. Coordinating Council (WECC) region.116 system. The types of data and 118. With respect to the modeling of The contract path methodology derives assumptions used in the models a particular transaction, when ATC directly from predetermined TTC, include, for example, facility ratings, the information concerning the source is ETC, CBM, and TRM values derived operating status of facilities, and unknown, a transmission provider has consistent with contract path generation dispatch, which might be the discretion to select which transmission rights. The second method supported by history, transmission generator(s) will be used as a source.119 is the flowgate 117 approach, which is plans, or the judgment of the There are no standards for how that used more widely in the Eastern transmission provider. For example, a modeling should be done and, Interconnection.118 The flowgate transmission provider could use its consequently, a transmission provider methodology is based on physical judgment to reduce a facility rating or could model a source using single or power flow models. The flowgate model certain facilities as out of service, multiple generators by increasing calculation first determines AFC and which would have the effect of (scaling up) their output. In general, then converts AFC into ATC and derives calculating a lower TTC value. A modeling a transaction using multiple TTC for the OASIS posting. The transmission provider also may use generators as a source is less differences between the two approaches generation dispatch assumptions to conservative for the transmission system may not result in significantly different limit transfer capability that otherwise than modeling a transaction using a ATC values if consistent data inputs and would have been available to single generator as a source. Modeling a industry acceptable modeling independent generators, thereby transaction using multiple generators as favoring the transmission provider’s a source typically results in a higher 113 NERC defines TTC as the amount of electric own generation. A transmission ATC value. Conversely, when a power that can be moved or transferred reliably provider usually assumes that transmission provider models a from one area to another area of the interconnected designated network resources are transmission systems by way of all transmission transaction using a single generator as a lines (or paths) between those areas under specified dispatched in economic merit order. source, this can result in a lower ATC system conditions. See NERC Glossary. However, a transmission provider has value depending on the location of the 114 See NERC, Available Transfer Capability the discretion to decide which of the generator. Modeling of contingency Definitions and Determination: A Framework for generators that are not designated outages used for calculating ATC is Determining Available Transfer Capabilities of the network resources will be modeled in- Interconnected Transmission Networks for a another area within the discretion of the Commercially Viable Electricity Market (1996) service. Assumptions like these transmission provider. Although the available at influence the loading on transmission type of contingency, such as single ftp://www.nerc.com/pub/sys/all_updl/docs/pubs/ lines in the model and heavily influence contingency (n–1), is determined by atcfinal.pdf. the resulting ATC. Having standards in 115 governing reliability criteria,120 the See supra note 59. place that address the calculation of 116 See, e.g., Determination of Available Transfer transmission provider determines which Capability within the Western Interconnection ATC components, data inputs, and specific contingencies will be used for modeling assumptions would help (June 2001), available at the ATC calculation. The common http://www.wecc.biz/documents/library/ ensure non-discriminatory treatment by industry practice is to consider the loss procedures/ATC-apprdec01.pdf. limiting a transmission provider’s 117 A flowgate is a designated point on the ability to use discretion to the transmission system used in the modeling of power 119 Transmission providers do not always know flows. While NERC currently does not have a formal disadvantage of competitors and the the generator used as a source of energy provided definition for AFC, the power industry commonly market. under contracts that qualify as designated defines AFC as a measure of the capability 117. As noted above, NERC does not resources; the only requirement is that the network remaining on a flowgate for future uses, after have a formal definition of ETC. customer have an executed contract that commits considering the effect of prior sales. it to purchase noninterruptible power. See Mathematically, the industry measures AFC as AFC Without clear criteria for what should Wisconsin Public Power Inc. v. Wisconsin Public = Flowgate rating—[(base case flow)—(impacts of be included in a transmission provider’s Service Corp., 84 FERC ¶ 61,120 at 61,650–51 existing reservations)]—FlowgateCBM— ETC, a transmission customer might not (1998). FlowgateTRM. know whether ETC is being over- or 120 Standard TPL–001–0, Table I. Transmission 118 See, e.g., PJM Manual 2: Transmission Service System Standards—Normal and Emergency Request (April 14, 2005), available at: underestimated. For example, a Conditions, NERC Reliability Standards for the Bulk http://www.pjm.com/contributions/pjm-manuals/ transmission provider could set aside Electric Systems of North America (effective April pdf/m02v08.pdf more capacity for native load than is 1, 2005).

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of each transmission facility at voltage that the transmission network will be transmission provider could grant 100 kV and above. However, the lack of secure under a reasonable range of transmission service without being standards governing transfer analysis uncertainties in system conditions. aware of the real impact that service allows the transmission provider to use Because TRM and CBM are both may have on an adjacent transmission its discretion to monitor outages only of maintained in part for the loss of provider’s system, thus degrading the facilities at 230 kV and above, ignoring generators, there exists the possibility of reliability of the interconnected system. the limitations that may exist for the double-counting reliability margins for Inaccurate ATC values can cause loss of the facilities at lower voltages, the loss of the same generation. overselling of transfer capability, which such as 115 kV or 138 kV. 121. Moreover, a transmission can lead to curtailments or transmission Consequently, ATC values may vary provider also can use more conservative loading relief (TLR) actions to avoid substantially, with ATC being much inputs and assumptions for calculating exceeding thermal, voltage, and/or higher when monitoring contingencies ATC and performing system impact stability limits. studies (that tend to minimize ATC) of facilities at 230 kV and above, and Transparency much lower while monitoring the loss when it is assessing a long-term of all facilities (voltage 100 kV and transmission service request, but use 124. As discussed, the lack of a above). less conservative inputs and consistent, industry-wide methodology 119. Furthermore, in calculating ATC, assumptions (that tend to maximize for assessing ATC makes undue transmission providers set aside a ATC) when it is performing system discrimination difficult to detect. This portion of transfer capability in the form planning for retail native load. This problem is further exacerbated by a lack of CBM and/or TRM to provide for creates the potential for undue of transparency surrounding the adequate generation reserves and discrimination where a transmission calculation methodology used by account for uncertainties or provider uses one set of data and transmission providers. Although the contingencies, respectively. Generally, assumptions to evaluate third party Commission requires transmission CBM is the amount of firm transmission requests and another set of data and providers to file their methodologies for transfer capability held back by the assumptions to plan its system to serve calculating ATC in their tariffs, transmission provider so that load- its own load. transmission providers often have serving entities, whose loads are located responded by filing very general Data Exchange Among Transmission narrative descriptions of their on the transmission provider’s system, Providers can access remote generation reserve calculation methodologies (often simply from interconnected systems in times of 122. The lack of a consistent ATC referring to the general NERC calculation methodology combined with 122 emergency generation deficiencies. definition) without further limited coordination between Some believe it is necessary for specification of the mathematical transmission providers can result not transmission providers to set aside a algorithm, data inputs, and modeling only in inefficiencies but unjust and portion of their TTC to ensure that their assumptions used to perform the unreasonable terms and conditions of ties with other systems remain available calculation. service, especially for a customer 125. Other than the description of the for this purpose. There are no consistent seeking contiguous transmission service ATC methodology provided in industry-wide standards, however, for from multiple transmission providers. transmission providers’ tariffs, third determining how much transfer The ATC values posted by a parties often have limited access to capability should be set aside as CBM. transmission provider are often information concerning the specific There is also no common approach to inaccurate for reasons beyond the algorithms, data and assumptions used whether the capacity is set aside for control of the transmission provider. A by transmission providers to evaluate Native Load Customers, as defined in transmission provider may post ATC their ATC, which makes it difficult to section 1.19 of the pro forma OATT, for values in good faith and attempt to verify or challenge a transmission retail load, or for all load-serving provide transmission service based on provider’s ATC calculations. The entities. The lack of consistent criteria these values only to discover later that Commission requires each transmission and clarity with regard to the entity on the transfer capability that it thought provider to calculate and post ATC and whose behalf CBM has been set aside was available no longer exists due to TTC values for each posted path.123 has the potential to result in the decisions made by other transmission Transmission providers also are transmission provider setting aside providers that it did not know about at required to make publicly available, on capacity that it might not otherwise the time it made its calculations. request, all data used to calculate ATC need to, thus increasing costs for native Accurate ATC calculation requires and TTC for any constrained path.124 load customers and blocking other firm reliable and timely information about Additionally, transmission providers are 121 uses of the transmission system. such things as load, generation dispatch, required to make publicly available, on 120. Similarly, TRM is the amount of facility outages, and transactions on request, system planning studies or transmission transfer capability reserved neighboring systems. Transmission by the transmission provider to ensure providers also may apply differing 122 See, e.g., the OATTs of Aquila, Inc., Southern, assumptions and criteria to ATC and Tucson Electric Power Company. 121 The Commission has explained that the pro 123 See 18 CFR 37.6 (b) (2005). A posted path is forma OATT requires both transmission customers calculations, which may produce wide defined as any control area to control area and transmission providers using the transmission variations in posted ATC values for the interconnection; any path for which service is system to serve network load (including bundled same transmission paths. All of these denied, curtailed or interrupted for more than 24 retail native load) to designate their resources and considerations make it difficult for an hours in the past 12 months; and any path for loads so that the transmission customers and which a customer requests to have ATC or TTC transmission providers would have no incentive to individual transmission provider that posted. Id. 37.6 (b)(1)(i). designate network resources above their needs and, operates one part of an interconnected 124 Id. 37.6 (b)(2)(ii). A constrained posted path is in so doing, tie up valuable transmission capacity. grid to calculate ATC accurately. defined as any posted path having an ATC value Aquila Power Corp. v. Entergy Services, Inc., 90 123. This lack of communication and less than or equal to 25 percent of TTC at any time FERC ¶ 61,260, reh’g denied, 92 FERC ¶ 61,064 coordination between transmission during the preceding 168 hours or for which ATC (2000), reh’g denied, 101 FERC ¶ 61,328 (2002), has been calculated to be less than or equal to 25 aff’d sub nom. Entergy Services, Inc. v. FERC, 375 providers of ATC data can also affect percent of TTC for any period during the current F.3d 1204 (D.C. Cir. 2004) (Aquila). reliability. As discussed above, a hour or the next 168 hours. Id. 37.6 (b)(1)(ii).

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network impact studies performed for recommended greater communication Comments customers to determine network and coordination of ATC information to Comments on Consistency impacts. Furthermore, subsequent to ensure that neighboring entities Order Nos. 888 and 889, the exchange relevant information. Based 130. Many commenters express Commission required each transmission on the recommendations in the NERC general support for some level of increased consistency in ATC provider to post (and update) the CBM Report, NERC has two Standards calculations.129 Some commenters urge value for each path for which it already Authorization Request (SAR) posts ATC and TTC, as well as a the Commission to develop a consistent, proceedings underway to revise the industry-wide methodology for narrative explanation of its CBM standards on ATC. The first SAR 125 calculating ATC.130 Constellation practices. proceeding proposes changes to the 126. Yet, despite these requirements, asserts that although transmission existing standards on ATC to, among third parties often are unable to gain providers need to be innovative and other things, further establish access to sufficient information flexible in many respects, a requirement surrounding a transmission provider’s consistency (on a regional basis) in the that all transmission providers use the ATC calculation methodology. As a calculation of ATC and to increase the same methodology to determine ATC preliminary matter, we note that while clarity of each transmission provider’s would not only remedy the lack of the OASIS requirements regarding the ATC calculation methodology. The clarity that surrounds these calculations availability of information related to second SAR proceeding proposes and reservations, but would provide ATC and TTC calculations are still in certain changes to NERC’s existing regulatory certainty and assist effect, they have been affected by standards on the ATC components of transmission customers in predicting restrictions that have been placed upon CBM and TRM. This proceeding also the outcome of transmission service the availability of critical energy calls for greater regional consistency requests. This, in turn, Constellation infrastructure information (CEII) in the and transparency in how CBM and TRM suggests, would expand the commercial interest of national security.126 are treated in transmission providers’ opportunities for transmission Therefore, system planning and network ATC calculations. Also, based on the customers. According to Alcoa, AWEA impact studies and models typically are recommendations in the NERC Report, and Renewable Energy, the industry- no longer available on a transmission the North American Energy Standards wide methodology should be a flow- provider’s OASIS. Furthermore, Board (NAESB) has a proceeding based methodology, rather than a transmission customers are often unable underway to develop business practice contract path methodology because they to access other information such as load standards to enhance the processing of believe that a flow-based analysis flow base cases and associated files. In transmission service requests, which provides a more realistic view of actual sum, although existing Commission use TTC, ATC and/or AFC. system usage and results in a more regulations are intended to provide a accurate assessment of ATC. Exelon certain level of transparency, this 128. Following the release of the further suggests that this uniform transparency is undermined by a NERC Report, the Commission issued methodology should also apply to all 128 number of factors, including the absence the ATC NOI seeking comments on transmission providers, including RTOs. of detailed descriptions of the data the contents of the NERC Report. More 131. Other commenters argue against inputs, assumptions, and criteria used specifically, the Commission sought a one-size-fits-all approach, but rather to determine the data included in ATC comments on the NERC Report’s express a preference for greater calculations, as well as the inability of recommendations on areas in which uniformity at a regional level to customers to access certain of this data CBM and TRM could be more specific recognize regional differences.131 These because of, among other reasons, and whether these recommendations go commenters suggest that due to security concerns. far enough in promoting a common differences in transmission systems or CBM and TRM methodology within regions, it may not be practical or Recent Industry Efforts To Improve the each region. The Commission also possible to standardize the ATC Consistency and Transparency of ATC sought comments on the definitions of calculation methodology on an Calculations ATC, AFC, CBM and TRM. The industry-wide basis. For example, 127. The industry recently has taken Commission also solicited comments on Powerex cautions that nationwide some steps to address the lack of the advisability of revising and standardization may not take into consistency and transparency in the standardizing ATC, AFC, TRM and CBM account the unique characteristics of way ATC is calculated. NERC formed a values. In addition, the Commission particular systems or regions, such as Long-Term AFC/ATC Task Force to sought comments on the advisability of the differences attributable to the West’s review NERC’s standards on ATC, developing interconnection-wide contract-path model and the East’s flow- which issued a final report in 2005 standards for the Eastern based model, as well as differences 127 attributable to the primarily hydro- (NERC Report) that made Interconnection and WECC. Finally, the recommendations for greater Commission asked for comments on the 129 E.g., Alcoa, Ameren, AWEA, Calpine, consistency and greater clarity in the most expeditious way to obtain calculation of ATC. The task force also Constellation, Cottonwood ATC NOI Comment, industry-wide standards for ATC ELCON, Exelon, FTC ATC NOI Comment, Midwest calculations. ISO ATC NOI Comment, Midwest SATS, New York 125 Capacity Benefit Margin in Computing Commission ATC NOI Comment, North Carolina Available Transmission Capacity, 88 FERC ¶ 61,099 129. Furthermore, in the NOI, the Commission, Occidental, South Carolina E&G, (1999) (CBM Order). Commission sought comments on TAPS, and TransAlta. 126 See Critical Energy Infrastructure Information, whether undue discrimination is most 130 E.g., Alcoa, AWEA, Constellation, Exelon, Order No. 630, 68 FR 9857 (Mar. 3, 2003), FERC Occidental, and Renewable Energy. Stats. & Regs. ¶ 31,140 (2003), order on reh’g, Order likely to occur in areas such as ATC 131 E.g., Alberta Intervenors, APPA, Bonneville, No. 630–A, 68 FR 46456 (Aug. 6, 2003), FERC Stats. calculation where the transmission International Transmission, ISO/RTO Council, & Regs. ¶ 31,147 (2003), order on clarification, provider retains discretion as to how to LDWP, MidAmerican, Nevada Companies, Order No. 662, 70 FR 37031 (Jun. 28, 2005), FERC implement a particular tariff provision. Powerex, Progress Energy, Public Generating Pool, Stats. & Regs. ¶ 31,189 (2005); see also 18 CFR Public Power Council, Salt River, Santa Clara, 388.113 (2005). Snohomish, Tacoma Power, TANC, and TDU 127 See supra note 115. 128 Supra note 9. Systems.

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based systems in the Pacific that increased uniformity could impose discussions.142 Furthermore, Northwest.132 Similarly, TANC argues significant costs upon utilities.137 commenters state that the Commission that flowgate terminology and 133. Some commenters urge the should establish a date certain for application in ATC calculation should Commission to increase the consistency completion of these industry efforts,143 not be required in the West because it of the elements of the ATC calculation, and should also take an active role in does not adequately represent the nature such as the kind of data inputs that the process.144 of the many transmission constraints in transmission providers consider when 135. Other commenters suggest that the West. Other commenters caution evaluating ATC—including load levels, the Commission should require that an that too much uniformity of the ATC generator outage information, independent entity develop and/or calculation methodology could have an transmission outage information and monitor a transmission provider’s ATC 138 adverse effect on grid reliability.133 In generation dispatch information. methodology and its ATC 145 addition, some commenters urge the Exelon also urges the Commission to calculations. For example, Commission not to adopt an ATC establish the assumptions that Constellation states that it does not methodology that is so prescriptive that transmission providers use in their ATC believe that the solution is to prohibit the transmission provider entirely from it inhibits new or better practices or methodologies—such as how exercising its discretion, but instead to imposes a wholesale revision of transmission reservations are accounted for and which reservations to model. require transmission providers to retain accepted market designs and processes Exelon also cites an example of an independent entity that can perform that are working within established modeling transaction counterflows, certain functions on a consistent, markets.134 noting that uniform rules for data inputs unbiased basis. In addition, the 132. Several commenters argue are needed to ensure that transaction Arkansas Commission asserts that against any efforts to further standardize counterflows are modeled identically in section 1281 of EPAct 2005 146 gives the ATC calculations.135 In its comments both the planning and ATC/AFC Commission the authority to require the filed in the ATC NOI proceeding, LDWP calculation processes. In addition, use of an independent coordinator of asserts that the alleged problems with commenters urge the Commission to transmission to provide independent ATC are overstated. Moreover, it argues, establish the procedures for determining and verifiable transparency over critical the benefits of squeezing additional ATC (and its components) and to Order No. 888 functions, such as ATC ATC from existing systems have not require a transmission provider to show calculations. been established given that transmission that it has properly followed all 136. Several commenters specifically customers can already request any required procedures.139 Among other address the lack of consistency in the capacity they need regardless of the things, commenters suggest that the industry on the definition and use of posted ATC and transmission providers Commission should establish how CBM and TRM. For example, TAPS are required to make a good-faith effort frequently ATC is calculated, how notes that NERC does not require any to evaluate each request. Several frequently inputs are updated, require transmission provider to reserve CBM. commenters argue that the transmission providers to determine In addition, TAPS states, even in those circumstances of individual AFC instead of ATC, and require regions that use CBM, there is often no transmission customers vary and often transmission providers to recognize all regional methodology; it is up to the ATC calculations rely on the individual third-party flowgates that are requested vertically integrated transmission transmission provider’s knowledge of its to be monitored. In addition, several provider to determine whether it wants to reserve CBM at all and at which facilities and system conditions.136 For commenters state that the Commission interfaces, with no effective review of example, Southern contends that too should require that the methodology that determination. TAPS also states many factors go into the calculation of and inputs for ATC calculations be that TRM should be clearly defined and, ATC to make the adoption of a static set consistent with the transmission if truly required for reliability, then all of standards feasible. In fact, Southern provider’s planning or operating criteria.140 transmission providers should reserve and EEI maintain, standardization of 134. Several commenters urge the it. According to TAPS, the Commission ATC calculations is inconsistent with Commission to allow the industry, should define TRM in a manner that maintaining reliability because the working through NERC and NAESB, to leaves no discretion as to whether, circumstances of transmission providers complete efforts already underway to where, and how much capacity to set vary significantly, and they must further increase consistency of ATC aside. EPSA also notes that there is a operate their systems based on their (and its components), as well as certain disconnect between the planning and specific circumstances. In addition, related business practices.141 However, expansion processes and the LG&E maintains that standardizing ATC many of these commenters urge the assumptions transmission providers use will not necessarily eliminate the need Commission to give the industry, to calculate CBM and TRM. for TLR procedures to deal with load working through these organizations, 137. TANC states that the forecast errors and unplanned specific guidance on what issues to Commission should closely examine the generation and transmission outages. decide and the parameters for the necessity of CBM in ATC calculations. Furthermore, some commenters argue Bonneville argues that there should only 137 E.g., International Transmission and LG&E. 132 Accord LDWP ATC NOI Comment, Public 138 E.g., Exelon and TDU Systems. 142 E.g., APPA ATC NOI Comment and Power Council, Salt River, Snohomish, Tacoma, 139 E.g., Ameren and Exelon. International Transmission ATC NOI Comments. and TANC. 140 E.g., Exelon, ISO/RTO ATC NOI Comment, 143 E.g., Duke and Exelon. 133 E.g., NERC ATC NOI Comment, Public Power MISO, and NERC. 144 E.g., APPA ATC NOI Comment, TAPS, and Council, and TVA. 141 E.g., Ameren, APPA ATC NOI Comment, TransAlta. 134 E.g., ISO/RTO ATC NOI Comment and Duke, EEI, Exelon, International Transmission 145 E.g., Arkansas Commission, Calpine, Powerex. Company ATC NOI Comment, ISO/RTO Council Constellation, EPSA, New York Commission, 135 E.g., Cinergy, EEI, LG&E, LDWP ATC NOI ATC NOI Comment, KCP&L, MidAmerican ATC Occidental, and TDU Systems. Comment, National Grid, PPL, Public Generating NOI Comment, MISO ATC NOI Comment, Progress 146 EPAct 2005 sec. 1281(to be codified at section Pool, San Diego G&E, Southern, TVA, and Xcel. Energy, Southern, TAPS, TDU Systems, TransAlta, 220 of the FPA, 16 U.S.C. 824t), which concerns 136 E.g., Southern and TVA. and WestConnect ATC NOI Comment. electricity market transparency rules.

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be one commercial margin instead of the non-independent transmission discrimination, but cautions the multiple margins (TRM, CBM, and providers. According to NY Commission against imposing others). Commission, in order for RTOs to unnecessary and duplicative posting properly determine tie flow limits, they requirements and notes that much of the Comments on Data Exchange Among need access to certain information from information that commenters have Transmission Providers the control region on the other side such asked the Commission to make 138. Several commenters argue that as load levels and distributions, transparent is in fact already publicly the Commission should establish generator dynamic capability and available through a variety of sources. standards for resolving seams issues expected outputs, phase shifter 144. In addition, some commenters between transmission providers where positions and standard contingencies urge the Commission to impose each transmission provider uses a required by that control area. In meaningful reporting requirements.151 different methodology for calculating addition, NY Commission states, these In this regard, Constellation asserts that ATC.147 Constellation and BC inputs need to be updated daily. the Commission should modify the pro Transmission assert that when different 141. Finally, Alcoa states that the forma OATT to require that transmission providers have different potential for underestimating ATC is transmission providers post systematic, methods for determining ATC, this can likely another consequence of the timely and accurate reporting of certain lead to inefficiencies, including market fundamental conflict between the service metrics such as transaction confusion, lost sales/purchase contract path model and the electricity requests approved, rejected, confirmed, opportunities, and unnecessary path model of contracting for electric and curtailed. Similarly, Cottonwood curtailments. energy. According to Alcoa, outside of states that transmission providers 139. Commenters identify various ISO/RTO systems, utilities may not have should be required to provide elements of the ATC calculation enough data available to compute ATC, information detailing why a particular methodology that they argue should be since they may not be able to accurately transmission request was denied and more consistent. For example, BC complete all relevant parallel path whether there are other available Transmission states that some of the transactions. alternatives. In addition, several elements that are calculated differently commenters argue that transmission at the seams include the level of TRM, Comments on Transparency providers also should be required to the level of CBM, the approach 142. Commenters are overwhelmingly post their relevant business practices, regarding the sale (or not) of TRM as in favor of greater transparency in the operating standards, protocols and non-firm capacity, assumptions ATC calculation methodology to internal guidelines that affect regarding controlling interchange and provide more assurance that a transmission service.152 TDU Systems assumptions regarding operating transmission provider is not performing also urge the Commission to require conditions. Similarly, MidAmerican in its ATC calculations in an inconsistent transmission providers to explain why its response to the ATC NOI suggests or unduly discriminatory manner.148 transactions are allowed to flow even that greater coordination is needed on EEI suggests that transmission providers when the posted ATC value was zero. partial path review, policies for could make their base case load flow 145. EPSA argues that capacity is decrementing AFC and redispatch studies on which they base their unnecessarily held from the market policies. For example, MidAmerican calculation of ATC available to when transmission providers reserve references problems associated with transmission customers, subject to excessive amounts for their native load coordination between transmission security and confidentiality protections. and when they fail to make capacity providers on partial path treatment. Other commenters state that greater available through redispatch. EPSA Specifically, when transmission service transparency could be achieved through states, however, that there is no way of involves a path across multiple systems, the imposition of additional posting knowing whether there is a hoarding a given flowgate may be evaluated requirements on OASIS.149 These problem because there is no several times by various providers on commenters argue that the Commission requirement to post the necessary real the transmission path. Because of a lack should require transmission providers time information on transmission of coordination between these to post their discrete methodologies and utilization, and recommends a providers, AFC on the flowgate may be algorithms for evaluating ATC, as well requirement to post such information. decremented multiple times for the as their transmission modeling Powerex contends there is an incentive same transmission service request, and information and their various for transmission providers to hoard service may be denied even when the assumptions. Commenters further because grandfathered or other firm true available capacity on the flowgate suggest that transmission providers rights held by the transmission provider is sufficient to allow the request to be should be required to provide to serve native load are subsequently granted. Exelon also states that certain information regarding planned outages, used for wholesale marketing purposes. data inputs must be coordinated across and to ensure consistent treatment of It further states, however, that evidence all transmission providers in an outage information between control of anticompetitive practices is difficult interconnection including load levels, areas.150 to obtain because of a lack of transmission outages, generation 143. In its reply comments, Southern transparency. Powerex supports outages and generation dispatch. In acknowledges that greater transparency increased requirements for both uniform addition, Exelon states, the Commission would reduce concerns of undue and transparent ATC calculation. should establish how transmission 146. Several commenters urge the providers account for transmission 148 E.g., Alcoa, Ameren, APPA, Calpine, CEOB, Commission to establish compliance reservations in an ATC/AFC calculation. Cinergy, Constellation, Cottonwood, Duke, EEI, review procedures and impose ELCON, HQ Energy, LDWP, MidAmerican, Midwest sanctions for violations to ensure that 140. Moreover, NY Commission ISO, Midwest SATs, Powerex, PPL, Progress suggests that this problem goes beyond Energy, Public Generating Pool, Public Power transmission providers are accountable Council, Salt River, Southern, TANC, TAPS, TDU 147 E.g., BC Transmission, Constellation, Exelon, Systems, TransAlta, and TVA. 151 E.g., Constellation, Cottonwood, and TDU NY Transmission, Renewable Energy, and TDU 149 E.g., Calpine and PPL. Systems. Systems. 150 E.g., H.Q. Energy and Powerex. 152 E.g., Powerex and TransAlta.

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for ensuring that their ATC calculations have already undertaken to achieve the service,155 particularly given the threat are correct.153 In its response to the ATC goals we propose to set out for them. of the Commission’s new civil penalty NOI, Cottonwood states that the 150. We propose to take this action authority. Commission should develop specific pursuant to our obligation under FPA 153. In addition to our preliminary tests (benchmarks) to monitor section 206 to remedy undue finding that the lack of consistent, transmission providers’ performance. In discrimination in the provision of industry-wide ATC calculation addition, HQ Energy states that the transmission service. Transmission standards is unjust and unreasonable Commission should conduct periodic providers in general enjoy substantial under FPA section 206, we believe that reviews of whether non-independent discretion in establishing and it poses a threat to the reliable operation transmission providers have properly interpreting the specific algorithms, of the bulk-power system. A calculated and allocated ATC. ELCON data, and assumptions needed to assess transmission provider needs to know states that the Commission should place ATC. Though we do not believe it is how much electricity its system can the burden of proof to depart from its possible or necessary to entirely carry. The lack of a consistent, industry- ATC methodology on the transmission eliminate discretion, unchecked wide methodology for evaluating ATC provider and include specific penalties discretion affords a transmission and the lack of data sharing among in the tariff for transmission providers provider the ability and opportunity to transmission providers often leads to that are found to be in violation. discriminate in its favor (and its problems in determining the affiliate’s favor) against third parties in appropriate ATC value. Despite a 147. HQ Energy and Powerex also how it calculates and allocates ATC transmission provider’s good faith state that the Commission should and, therefore, may be unjust, attempt to calculate and post accurate require transmission providers to ensure unreasonable, unduly discriminatory ATC levels, it can find that transmission that staff is available at all times to and preferential. Transmission that it thought was available on its respond to customer inquiries regarding providers have an incentive to system no longer exists because it was real-time transactions. understate ATC on transmission paths unaware of decisions by other Discussion that would be valuable to power sellers transmission providers. This, in turn, that are competitors to the transmission can threaten the reliable operation of the 148. We propose to address the providers’ own (or their affiliates’) interconnected transmission system.156 potential for remaining undue power sales. Where transmission 154. As a result of reliability effects of discrimination in the determination of congestion exists, the methodology for inconsistent ATC calculations, our ATC by requiring industry-wide calculating ATC will effectively proposal for greater consistency and consistency and transparency of certain determine whether competitors have transparency also is supported by our definitions, data, modeling assumptions access to the transmission grid, and the new authority under section 215 of the and components of ATC. We propose to lack of any consistent methodology for FPA, which gives the Commission provide general guidance regarding the calculating ATC gives transmission jurisdiction to certify an Electric aspects of ATC calculation that we providers excessive discretion in Reliability Organization (ERO) and to believe should be more consistent and making this determination. approve reliability standards that are direct public utilities, working through 151. The lack of consistency and just, reasonable, not unduly NERC and NAESB, to use our guidance detail in the determination of ATC can discriminatory or preferential, and in to revise the relevant standards and facilitate undue discrimination in a the public interest. The Commission business practices. In addition, we variety of ways. Transmission providers also has authority to order the ERO to propose to require increased detail in may use generation dispatch submit a reliability standard that the the pro forma OATT regarding the assumptions that result in limited Commission considers appropriate to method of calculating ATC and to capacity being available to merchant implement FPA section 215.157 On amend our OASIS regulations to require generators. They also may use different April 4, 2006, NERC submitted an increased transparency. inputs and assumptions for purposes of application to be certified as the ERO, calculating ATC for third parties than as well as proposed reliability 149. Though NERC and NAESB they do for system planning for retail standards.158 In this NOPR, we direct currently are working on certain native load. As noted above, a our guidance to public utilities and proposals to address the problems we transmission provider could reduce a recommend that they implement our 154 have identified, we are concerned facility rating or model certain facilities direction by working with NERC. that without guidance, direction and a as out of service, which would have the However, this is not intended to firm deadline, these industry effect of underestimating TTC. In prejudge the outcome of the ERO developments may not succeed due to determining ETC, transmission proceeding. Though the Commission other conflicting priorities. We believe providers have discretion to determine that the existing NERC and NAESB the capacity needed and set aside for 155 E.g., Ameren, APPA ATC NOI Comments, processes are well-suited to achieving native load usage. Each of these Duke, EEI, Exelon, International Transmission greater consistency in ATC calculations. exercises of discretion has a significant Company ATC NOI Comments, ISO/RTO Council It is our expectation that NERC and ATC NOI Comments, KCP&L, MidAmerican ATC effect on ATC. NOI Comments, MISO ATC NOI Comments, NAESB will expand on the work they 152. The lack of transparency into Progress Energy, Southern, TAPS, TDU Systems, how a transmission provider calculates TransAlta, and WestConnect ATC NOI Comments. 153 E.g., Cottonwood ATC NOI Comment, ELCON, and allocates its ATC (including all 156 According to NERC, ‘‘the lack of HQ Energy, NRECA, Occidental, and Powerex. assumptions and data inputs) makes it standardization and more ignificantly, limited 154 We understand that two NERC standard coordination can negatively impact both the market, authorization requests related to ATC/ TTC/AFC difficult to detect discriminatory through the need for a large number of [TLR] and CBM/TRM were approved earlier this year, and behavior. This lack of transparency actions (or curtailments in WECC) and, on occasion, that drafting of the standards’ revision is underway. frustrates and increases the costs of reliability when even the use of TLRs provides We further understand that NAESB has a compliance and enforcement efforts. insufficient relief on some critical interfaces.’’ See concurrent drafting effort underway for associated NERC Report at 1. business practices that will follow a coordinated Many transmission providers have 157 Section 215(d)(5). path with the NERC process. See http://www. urged the Commission to provide 158 See Docket Nos. RR06–1–000 and RM06–16– nerc.com/filez/standards/MOD-V0-Revision.html. greater clarity in the rules for OATT 000.

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will act independently on the reliability further consistency and most important capacity needed and set aside for native standards proposed by NERC in Docket in terms of eliminating opportunities for load usage. In addition, we propose that No. RM06–16–000, we believe it is undue discrimination. accounting for transmission reservations prudent to provide our guidance now on 156. The Commission recognizes that in an ATC/AFC calculation also should NERC’s reliability standards related to transmission providers use several basic be more consistent. Presently, there are ATC by providing specific direction on types of ATC calculation methodologies two main methods in use. One method what should be more consistent and a (with various permutations), and does models all ‘‘appropriate timeframe for completion of NERC’s not believe that a single ATC calculation reservations’’ 164 in the power flow base efforts.159 As we indicated above, the methodology must be applied by all case model. The other method models lack of consistency, data exchange and transmission providers.161 However, we only those reservations that are transparency in ATC calculations not agree with commenters who argue that expected to be actually scheduled and only can increase the opportunities for the amount of discretion in the existing accounts for others by decrementing undue discrimination but also can ATC calculation methodologies gives flowgate AFC. It is important for threaten reliability. We therefore believe transmission providers the ability and consistency to use the same calculation that Commission action pursuant to opportunity to unduly discriminate technique when modeling these types of FPA section 215 may be appropriate on against third parties. Accordingly, we reservations. Therefore, we propose that reliability standards related to ATC propose to achieve greater consistency public utilities, working through NERC, calculation. Any action on these in ATC calculations by directing the establish and specifically identify which reliability standards that is taken in development of consistent definitions of reservations they use in determining Docket No. RM06–16–000 (the ERO the components of ATC, as well as ETC. standards rulemaking) will be consistent data inputs, data exchange 159. The Commission has previously coordinated and consistent with our and coordination protocols, and addressed the lack of a consistent determinations regarding ATC modeling assumptions, as discussed industry-wide methodology for calculation in this proceeding.160 further below. We believe that this level determining CBM. Following a two-day technical conference, the Commission Consistency of consistency will go a long way toward producing more coherent and held in the CBM Order 165 that 155. The Commission proposes to uniform determinations of ATC across a transmission providers continue to require public utilities, working through region, thereby helping to eliminate the wield significant latitude in interpreting NERC, to develop the standards we set potential for undue discrimination.162 how CBM is determined. The forth below within 6 months of the final 157. We propose to direct public Commission directed that the CBM set- rule in this proceeding. Consistent with utilities, working through NERC, to aside be more transparent, more NERC’s existing efforts, we propose to develop consistent practices for TTC/ accurate, and more widely available.166 require the development of standards TFC calculation methodologies. We We remain concerned, however, that for: (1) ATC/AFC, TTC/Total Flowgate recognize that the NERC reliability transmission providers have preferential Capacity (TFC), ETC, CBM, and TRM regions have historically calculated access to the interface capacity that is calculation methodologies, (2) data transfer capability using different set aside. This interface capacity is paid inputs, (3) modeling assumptions, (4) approaches.163 However, we expect that for by all transmission customers ATC calculation frequency, and (5) data guidelines can be developed for the whether or not they receive a benefit exchange and coordination processes. calculation of transfer capability that from the set-aside. In general, we We further propose to require public use a common approach to model power believe that the latitude associated with utilities, working through NAESB, to transfers. In addition, we believe that CBM undermines the certainty and work with NERC to identify the the criteria used for identifying transparency that is needed for non- appropriate business practices to flowgates and determining TTC/TFC discriminatory, open-access complement the standards developed by can be more consistent. transmission service. NERC. We discuss below each of the 158. The Commission believes that 160. The current pro forma OATT elements for which we propose to the lack of consistency of ETC permits offers two means of reserving transfer require more consistency. We seek too much discretion in determining how capability, either of which implicitly comment on these elements of the ATC provides some financial discipline to much capacity a transmission provider calculation and, in particular, whether overreservations. The first is the sets aside for native load, including its certain elements are more susceptible to requirement to designate a network network customers. We believe that the further consistency than others and resource on the other side of the development of an industry-wide whether certain elements should be interface and assume the associated methodology can limit this discretion. prioritized over others because they financial responsibility of either owning Therefore, we propose to require the represent the source of most disputes the resource or executing a firm power development of a consistent between transmission providers and purchase agreement. The other is to methodology for determining the customers. We recognize the need to contract for firm point-to-point service focus on those elements of the ATC on the interface, which requires the 161 For example, there are two primary ATC calculation that are most susceptible to calculation methodologies: The contract path payment of a point-to-point reservation approach and the flowgate approach. See generally charge. In either case there is a 159 In this NOPR, we direct our guidance to P 115. However, the ATC values that result from disincentive to reserving transfer NERC, though the reliability standards relating to application of either method should largely be the capability simply to prevent someone ATC ultimately will be adopted by the ERO. same if consistent data inputs and modeling else from using it on a firm basis. With 160 We note that Commission staff recently assumptions are used. released a preliminary assessment of the proposed 162 As discussed further below, for consistency to ATC-related reliability standards, stating that they be fully effective, it should be coupled with 164 ‘‘Appropriate reservations’’ takes into account ‘‘may result in unnecessary regional variations not increased transparency. As such, we also propose the time frame (e.g., yearly, monthly) and ATC justified by technical differences and inconsistent greater transparency below. product (e.g., firm, non-firm) being calculated. applications.’’ Staff Preliminary Assessment of the 163 One approach models power transfers by 165 Capacity Benefit Margin in Computing North American Reliability Council’s Proposed scaling up/down the load, a second approach scales Available Transmission Capacity, 88 FERC ¶ 61,099 Mandatory Reliability Standards at 80 (May 11, generation up/down, and yet another approach uses (1999) (CBM Order). 2006). a combination of changes in load and generation. 166 CBM Order at 61,237–38.

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these processes in mind, the Commission position was that if a calculating ATC. The data and models Commission has identified three utility wanted to use firm transmission used by the transmission provider possible options to provide the capacity on an interface to serve its should be consistent, to the maximum necessary certainty, transparency, and native load, it was required to designate extent practicable, with the data and financial discipline necessary to remedy a network resource associated with that models used for the planning, operation, the potential for undue discrimination capacity on the other side of the and expansion of the transmission associated with inappropriate ATC set- interface pursuant to the requirements system. While NERC’s current ATC- asides for CBM. These options need not of the pro forma OATT.168 Specifically, related standards (MOD–001—MOD– be mutually exclusive. the Commission stated that the pro 009) require that steady state and 161. One option is to require that forma OATT requires the transmission dynamic data be submitted and that clear standards be developed for how provider to designate all network steady state and dynamic system models the CBM value should be determined resources, including those acquired for be prepared, there is no requirement to and allocated across transmission paths, the purpose of meeting generation periodically benchmark these models and for which customers CBM should reserves, in the same manner as network and appropriately modify them against be used.167 Consistent with the customers do.169 The retention of this actual system events.170 Therefore, the standards development process that is obligation would require the Commission proposes that public already in progress, we propose that transmission provider to replace any utilities, working through NERC, modify these standards specify how CBM existing set-aside of firm transfer the ATC-related standards to should be reserved to allow any load- capability as CBM with reservations for incorporate a requirement for the serving entity to meet generation specific designated resources. We seek periodic review and modification of reliability criteria on a comment on the reasonableness of these models (including load flow base nondiscriminatory basis. In addition, we eliminating CBM and any impacts on cases, short circuit data, transient and propose that NERC specify emergency the reliable operation of the dynamic stability simulation data, generation deficiency conditions during transmission system. Commenters are contingency,171 subsystem and which a load-serving entity will be encouraged to provide specific monitoring files, and production cost allowed to use the transfer capability examples of transmission providers that models), in order to ensure that they are reserved as CBM. We believe that CBM currently do not use CBM and, up to date. should be reserved only when there is alternatively, conditions under which 166. Modeling assumptions are a insufficient local generation capacity to CBM must be used. We also ask for crucial element in the calculation of meet generation reliability standards, comments on how eliminating CBM ATC. The Commission proposes that and it should always have a zero value would affect the ability of load-serving public utilities, working through NERC, in the calculation of non-firm ATC. entities to meet existing generation develop consistent assumptions for use 162. Another approach may be to reliability adequacy requirements. in ATC determinations. The develop a specific charge for setting 164. The Commission proposes that Commission proposes that the aside ATC for CBM. This approach public utilities, working through NERC, assumptions used in the calculation of would treat CBM as a service that would develop clear standards for how TRM is ATC be made consistent among be available to customers serving load determined, allocated across transmission providers, to the maximum within the transmission provider’s transmission paths, and used. In extent practicable. In general, the service area. To do this, the Commission addition, we propose to require that the Commission believes that the would propose that an entity for which standards ensure that there will be no assumptions used in the determination transfer capability has been set aside to contingency double-counting when of ATC should be consistent with those meet generation reliability criteria be calculating TRM, TTC and CBM. We used when planning the operation and charged a separate rate for this service. also propose that the standards expansion of the transmission system. We seek comment on this proposal to developed should specify the This is necessary to remedy the charge a separate rate, as well as uncertainties that are accounted for in potential for undue discrimination comment on the potential impacts on TRM and the methods used to between the manner in which a overall rates and revenues. We also seek determine their impacts on TRM values. transmission provider plans and comment on whether there are credible The Commission proposes that TRM can operates its system to serve native load situations in which the proposal would be used to accommodate uncertainties and the manner in which it calculates such as: (1) Load forecast and load not be feasible. Commenters are ATC for service to third parties. distribution error, (2) variations in encouraged to provide specific Consequently, the models for short- and facility loadings, (3) uncertainty in examples. long-term ATC calculation should be 163. A third option may be to transmission system topology, (4) loop developed using consistent assumptions eliminate CBM and replace it with flow impact, (5) variations in generation regarding the load level, generation specific transfer capability reservations dispatch, including intermittent dispatch, transmission and generation associated with designated network resources, (6) automatic sharing of facilities maintenance schedules, resources. In several cases, the reserves, and (7) other uncertainties contingency outages and topology as Commission addressed instances when identified through the NERC forums. those used in the planning for operation 165. The Commission acknowledges transmission providers had taken and expansion. In addition, the long- that accurate data and system models advantage of their ability to preserve term ATC models should rely to the are essential to accurately simulate the interface capability to serve their own maximum extent practicable upon the performance of the electric system when load while limiting the ability of competing suppliers to access customers 170 See U.S.-Canada Power System Outage Task 168 See Aquila supra note 121; see also Morgan Force, Final Report on the August 14, 2003 on their systems. In these orders, the Stanley Capital Group v. Illinois Power Co., 83 Blackout in the United States and Canada: Causes FERC ¶ 61,204, clarified, 83 FERC ¶ 61,299 (1998), and Recommendations, Recommendation Number 167 NERC has already contemplated developing a order on reh’g, 93 FERC ¶ 61,081 (2000). 24 (April 2004). See http://reports.energy.gov/. standard to address CBM issues. See http:// 169 Wisconsin Public Power Inc. SYSTEM v. 171 Contingency files should contain information www.nerc.com/∼filez/standards/MOD-V0- Wisconsin Public Service Corp., 83 FERC ¶ 61,198 on special protection schemes and remedial action Revision.html. at 61,857–58 (1998). plans.

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same assumptions regarding new 169. The Commission believes that oversight and review. The Commission transmission and generation facilities significant improvements in the also is concerned that this lack of additions and retirements as those used communication, coordination, and transparency could allow transmission in the planning for expansion. exchange of data across all transmission providers to unduly discriminate 167. More specifically, the providers in an interconnection are against their competitors when Commission proposes to direct public needed to produce accurate allocating transmission service. We utilities, working through NERC, to determinations of ATC. Therefore, we agree with commenters that greater establish consistent assumptions that propose that public utilities, working transparency is needed into how are related to the modeling of: (1) through NERC, develop consistent transmission providers calculate and Representative load levels, (2) protocols that would enable and require allocate ATC. Accordingly, in order to generation dispatch, (3) transmission the exchange of data among ensure that transmission service is reservations and (4) counterflows, in transmission providers. We propose that provided in a nondiscriminatory addition to any other modeling the following data, at a minimum, manner, we propose to require assumptions identified by NERC. should be exchanged among transmission providers to take certain Regarding the assumptions used for load transmission providers for the purposes measures to make their ATC calculation level modeling in the ATC calculation, of ATC modeling: (1) Load levels, (2) process more transparent. We believe the Commission proposes to require all transmission planned and contingency that these proposed changes will give transmission providers to have a outages, (3) generation planned and transmission customers access to consistent approach to modeling of load contingency outages, (4) base generation sufficient information to be able to levels. With respect to the base dispatch, (5) existing transmission examine the integrity of the process. generation dispatch, we propose that reservations, including counterflows, (6) Moreover, our proposal for greater public utilities, working through NERC, ATC calculation frequency, and (7) consistency in the way ATC is establish a method for determining source/sink modeling identification. In calculated should aid in transparency which generators should be modeled in addition, NERC may identify other data because there will be far fewer service, including guidance on how needs through the standards differences in the way individual independent generation should be development process. We seek comment transmission providers calculate ATC. considered. With respect to modeling of as to how much data sharing is This will make it less difficult to particular transactions, the Commission workable; whether there are additional determine whether ATC is being believes that a consistent approach is data that should be provided; whether calculated in an unduly discriminatory needed on how to simulate power flows access to such data should be limited to manner. from points of receipt to points of transmission providers; and if there are 172. Specifically, we propose to delivery when sources are unknown. existing forums by which these or require transmission providers to Accounting for transmission similar data are already shared. include, at a minimum, in Attachment reservations in an ATC/AFC calculation 170. In order to facilitate the process C of their OATT, the following also should be consistent.172 We note for achieving consistency in ATC information concerning their ATC that the purpose of more consistent calculations we have proposed in this calculation methodology (including the modeling assumptions is to eliminate NOPR, the Commission directs Staff to calculation of AFC, if applicable). First, discretion and the potential for undue hold a technical conference. The we propose to require transmission discrimination. This proposal is not technical conference will be transcribed providers to state their specific intended to change the manner in which to provide the Commission and NERC a mathematical algorithm used to native load customers are served. We record of the comments received at the calculate their firm and non-firm ATC seek comment on whether (and, if so, conference. The Commission will (and AFC, if applicable) for their how) this proposal would affect service provide further guidance regarding the scheduling horizon (same day and real- to native load customers. date of the technical conference and the time), operating horizon (day ahead and 168. The Commission also supports topics it intends to address at the pre-schedule) and their planning the development of clear standards on technical conference in a subsequent horizon (beyond the operating horizon). how often ATC/AFC and its individual notice. Second, we propose that transmission components are calculated and updated. Transparency providers provide a process flow The Commission proposes that public diagram that illustrates the various steps utilities, working through NERC and Pro forma OATT through which the ATC/AFC is NAESB, develop standards requiring 171. Though the Commission’s calculated. that the calculation be performed on a requirement that a transmission 173. In addition, we propose to consistent time interval among provider describe its ATC calculation require transmission providers to transmission providers and in a manner methodology in its OATT has not include in Attachment C a detailed that closely reflects the actual topology changed, that requirement has been explanation of how each of the ATC of the system concerning generation and interpreted in various ways. Some components is calculated for both the transmission outages, load forecast, transmission providers post a detailed operating and planning horizons. Thus, interchange schedules, transmission explanation of how they calculate ATC, for TTC, a transmission provider reservations, facility ratings, and other while other transmission providers post should: (1) Explain its definition of necessary data. The Commission also very general descriptions that fail to TTC; (2) explain its TTC calculation supports uniform updating of ATC offer sufficient detail for third parties to methodology (e.g., load flow, short values and components by adjacent understand how ATC has been derived. circuit, stability, transfer studies); (3) control areas. The Commission is concerned that the list the databases used in its TTC lack of transparency in some of the assessments; and (4) explain the 172 Currently, one method models all appropriate descriptions provided by transmission assumptions used in its TTC reservations in the power flow base case model, when another models only those reservations that providers gives these transmission assessments regarding load levels, are expected to be scheduled, and accounts for providers too much discretion to change generation dispatch, and modeling of others by decrementing flowgate AFC. ATC practices without sufficient planned and contingency outages.

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174. For ETC, we propose to require their procedures for allowing CBM 181. Our regulations state that a a transmission provider to explain: (1) during emergencies (with an transmission provider’s 174 ATC and Its definition of ETC; (2) the calculation explanation of what constitutes an TTC calculations shall be performed methodology used to determine the emergency, the entities that are according to consistently applied transmission capacity to be set aside for permitted to use CBM during methodologies referenced in the native load and non-OATT customers; emergencies and the procedures which transmission provider’s OATT and shall (3) how point-to-point service requests must be followed by the transmission be based on current industry practices, are incorporated; (4) how rollover rights providers’ merchant function and other standards and criteria.175 We propose to are accounted for; and (5) its processes load-serving entities when they need to revise this provision to include for ensuring that non-firm capacity is access CBM). The Commission further compliance with the reliability released properly (e.g., when real time stated that if a utility’s practice was not standards developed by the ERO—i.e., schedules replace the associated to reserve CBM, it should reflect that in ATC and TTC calculations shall be transmission service requests in its real- Attachment C. We propose to require performed according to consistently time calculations). With regard to (5), transmission providers to include this applied methodologies referenced in the we seek comment on whether narrative in Attachment C of their transmission provider’s OATT and shall transmission providers currently are OATTs. be based on the ERO reliability keeping track of when firm service 178. In addition, for CBM, we propose standards as well as current industry reservations are not scheduled and to require a transmission provider to: (1) practices, standards and criteria. should be released as non-firm. Explain its definition of CBM; (2) list 182. The regulations further state that, 175. If a transmission provider uses the databases used in its CBM on request, a transmission provider an AFC methodology to calculate ATC, calculations; and (3) prove that there is must provide all data used to calculate we propose to require it to explain: (1) no double-counting of contingency ATC and TTC for any constrained Its definition of AFC; (2) its AFC outages when performing CBM paths.176 Transmission providers also calculation methodology (e.g., load calculations. are required to make any system flow, short circuit, stability, transfer 179. Though we are proposing to planning studies or specific network studies); (3) its process for converting require transmission providers to impact studies performed for customers AFC into ATC; (4) what databases are provide greater clarity in the description to determine network impacts publicly used in its AFC assessments; (5) the of their ATC calculations, it is our available on request and to post a list of assumptions used in its AFC expectation that the reforms we propose such studies on the OASIS.177 The assessments; and (6) the reliability for greater consistency of ATC methods Commission proposes to maintain these criteria used for contingency outages will minimize the burden on requirements. simulation. 176. For TRM, we propose to require transmission providers and customers of 183. The Commission’s OASIS a transmission provider to explain: (1) assessing various ATC calculation regulations require transmission Its definition of TRM; (2) its TRM methodologies. Ultimately, when the providers to calculate and post ATC and 178 calculation methodology (e.g., its ATC standards development process we TTC for each posted path. The assumptions on load forecast errors, propose is completed, we expect that regulations define two classes of posted forecast errors in system topology or Attachment C will refer to the NERC paths based on usage: ‘‘constrained’’ distribution factors and loop flow standards and will differ by and ‘‘unconstrained.’’ A constrained sources); (3) the databases used in its transmission provider only with respect posted path is any posted path for TRM assessments; (4) the conditions to the limited elements of the ATC which ATC has been less than or equal under which the transmission provider calculation that may not have been to 25 percent of TTC at any time during uses TRM; and (5) the process used to made consistent. the preceding 168 hours or is calculated prevent double-counting of contingency OASIS to be less than, or equal to, 25 percent outages used in its TTC and TRM of TTC for any period during the current calculations. We propose to require 180. The Commission’s existing hour or the next 7 days. An transmission providers that do not regulations require certain ATC-related unconstrained posted path is any posted reserve TRM to reflect that in information to be posted on each path that is not a constrained posted Attachment C. We seek comment on the transmission provider’s OASIS, while path.179 The Commission proposes to above proposal, specifically on what other information is required to be amend the regulations relating to the type of showing a transmission provider provided on request. To ensure that data posted for constrained posted could make with regard to the process relevant information is available on a paths, but largely to retain the existing used to prevent double-counting. timely basis to all market participants, 177. Furthermore, in the CBM Order, we propose to amend our regulations to 174 We note that various provisions of the OASIS the Commission required transmission allow potential customers greater access regulations use the term ‘‘Responsible Party,’’ providers to post a specific and self- to information that will enable them to which means the transmission provider or an agent to whom the transmission provider has delegated contained narrative explanation of their obtain service on a non-discriminatory the responsibility of meeting any of the 173 CBM practices, including who performs basis from any transmission provider. requirements of the regulations. For simplicity, the assessment (transmission or We believe that our proposed reforms however, we will use the term ‘‘transmission merchant staff), the methodology used will not only enhance the amount and provider’’ here. accuracy of information available to 175 See 18 CFR 37.6(b)(2)(i) (2005). to perform generation reliability 176 customers, but will also increase the See 18 CFR 37.6(b)(2)(ii) (2005). assessments (e.g., probabilistic or 177 See 18 CFR 37.6(b)(2)(iii) (2005). deterministic), whether the assessment ability of the Commission and others to 178 See 18 CFR 37.6 (2005). method reflects a specific regional detect any potentially unduly 179 See 18 CFR 37.6(b)(1)(iii) (2005). Our practice, the assumptions used in those discriminatory behavior in a regulations require transmission providers to post assessments and the basis for the transmission provider’s calculation and ATC and TTC for specific time horizons for allocation of ATC. constrained posted paths and unconstrained posted selection of paths on which CBM is set paths. The Commission proposes to maintain the aside. In addition, the Commission existing time horizons. See 18 CFR 37.6(b)(3)(i)–(ii) directed transmission providers to post 173 See 18 CFR 37.2 (2005). (2005).

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posting requirements for unconstrained the denial for five years. In addition, we CEII posted paths, as set forth below. propose to extend the time period for 191. Shortly after the attacks on 184. First, in the CBM Order, the which transmission providers must September 11, 2001, the Commission Commission required transmission maintain transmission service removed from public viewing certain providers, with respect to each path for information for audit. Our regulations documents that were likely to contain which the utility already posts ATC, to currently require audit data to be detailed specifications of critical post (and update) the CBM figure for retained and made available upon infrastructure facilities. CEII is that path. The Commission also request for download for three years information concerning proposed or required transmission providers to make from the date when they are first existing critical infrastructure (physical 180 any transfer capability set aside for CBM posted. We propose to change the or virtual) that: (1) Relates to the available on a non-firm basis and to post period from three to five years. production, generation, transportation, this availability on OASIS. The 188. In the CBM Order, the transmission, or distribution of energy; Commission proposes to incorporate Commission stated that the level of ATC (2) could be useful to a person in these CBM posting requirements into its set aside for CBM can and should be planning an attack on critical regulations. reevaluated periodically to take into infrastructure; (3) is exempt from 185. With respect to paths for which account more certain information (such mandatory disclosure under the the utility already posts ATC, TTC, and as assumptions that may not have, in Freedom of Information Act, 5 U.S.C. CBM, we further propose to require each fact, materialized). Thus, the 552 (2000); and (4) does not simply give transmission provider to also post (and Commission directed transmission the location of the critical infrastructure. update) the TRM value for that path. providers to periodically reevaluate Accordingly, access to transmission- 186. Our existing regulations require their generation reliability needs so as to ATC and TTC on constrained paths to related information collected by the make known the availability of CBM Commission has been restricted by the be updated when: (1) Transactions are and to post on OASIS their practices in reserved, (2) service ends, or (3) Commission’s CEII regulations. Thus, this regard. We propose to incorporate for example, information filed in FERC whenever the TTC estimate for the path these requirements in the Commission’s changes by more than 10 percent. We do Form No. 715 (including base case regulations and to obligate transmission power flow data and transmission not believe that this regulation has providers to reevaluate the CBM set resulted in sufficient information to system maps) as well as system aside at least quarterly. planning and network impact studies determine why ATC values changed. To 189. We also propose to require the and models are no longer publicly provide a transmission customer with transmission provider and network available. However, requesters with a useful information to assist with its customers to use the transmission particular need (such as transmission evaluation of monthly and yearly firm provider’s OASIS to request designation customers and consultants with transmission service options, we of a new network resource and to legitimate needs) have the opportunity propose to supplement the existing terminate the designation of a network to access information designated as CEII regulations by requiring the resource. As with other transmission from the Commission by submitting a transmission provider to post a brief, request information posted on OASIS, request to the Commission under the but specific, narrative explanation of the the transmission provider should keep procedures set forth in our regulations. reason for the posted change in the designation and termination In Order No. 643,182 the Commission monthly and yearly ATC values on a information posted on OASIS for 90 addressed situations in which its constrained path. This narrative would days and should make designation and regulations require public utilities to describe, for example: (1) Scheduling of termination information available upon disclose information directly to the planned outages and occurrence of request for five years, consistent with 18 public. The Commission ruled that forced transmission outages; (2) de- CFR 37.7(b) (2005). Transmission potential CEII disclosed directly from ratings of transmission facilities; (3) customers will be able to query requests the public utility to the public should be scheduling of planned generation to designate and terminate a network evaluated under the same rules outages and occurrence of forced resource under 18 CFR 37.6(a)(6)(2005). addressing the disclosure of CEII from generation outages; (4) changes in load We propose to require the transmission forecast, (5) changes in new facilities in- the Commission to the public, i.e., if an provider to post on its OASIS a list of entity concludes that certain of its service dates, or other events or its current designated network resources assumption changes that cause the ATC information is CEII, it must designate it and all network customers’ current as such and provide other specified value to change. We seek comment on designated network resources. The list whether the posting of this new information about obtaining access to of network resources should include the the CEII through the Commission’s information would provide adequate name of the resource, its geographic and transparency to the customer on a process. The Commission also held that electrical location, and the amount of it did not intend to restrict an entity’s frequent enough basis without imposing capacity from the unit to be designated an undue burden on the transmission ability to reach appropriate as a network resource. arrangements for sharing CEII, and that provider. We seek comment on whether 190. Finally, we remind transmission all persons with a legitimate need for a similar narrative also should be providers that transfer capability CEII should be able to gain access to it required when ATC remains unchanged associated with transmission 183 at a value of zero for some specified with a minimum of difficulty. reservations that are not scheduled in 192. We believe that much of the period of time. real time must be included in non-firm information we propose to require 187. We propose to maintain the ATC and posted on OASIS.181 requirement in 18 CFR § 37.6(e)(2)(i) transmission providers to provide in this proposed rulemaking will not pose that a transmission provider must post 180 See 18 CFR 37.7(b) (2005). CEII concerns. If commenters believe the reason for a denial of a request for 181 Our regulations require non-firm ATC and service. We propose, however, to amend TTC for constrained posted paths to be posted in the same manner as firm ATC and TTC, except that 182 Amendments to Conform Regulations with this provision to require a transmission monthly and seasonal capability need only be Order No. 630, Order No. 643, 68 FR 52089 (Sep. provider to maintain and make available posted if requested. See 18 CFR 2, 2003), FERC Stats. & Regs. ¶ 31,149 (2003). information supporting the reason for 37.6(b)(3)(i)(B)(2005). 183 Id. at P 16.

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that any of the information is CEII, they point, non-firm point-to-point or customers or between transmission should explain the basis for that view. network service). providers in a given region,185 nor did We recognize that requiring interested 194. Another area of discretion is the it impose any specific requirements persons to use the existing CEII process load forecasts used by the transmission regarding the manner in which to access information we propose to provider when computing ATC. The transmission providers should require transmission providers to Commission recognizes that the lack of coordinate their transmission system provide in this rulemaking could transparency regarding transmission planning with their pro forma OATT undermine our goal of providing providers’ forecasted and actual use of customers. The only section of the pro increased transparency to information the transmission system makes it forma OATT that directly speaks to joint necessary to evaluate the use of the difficult to determine whether an planning is section 30.9, which provides transmission system. As a result, we appropriate amount of capacity is being that for facilities constructed by a seek comment on procedures that could set aside for service to native load. To network customer, the network be adopted by transmission providers to address this concern, we are considering customer must receive credit where streamline the resolution of CEII additional posting requirements. For such facilities are jointly planned and concerns and allow timely disclosure of example, should transmission providers installed in coordination with the information from the transmission make available their underlying load transmission provider.186 providers to interested persons. forecast assumptions for all ATC 197. In the NOI, the Commission calculations? In addition, should asked several questions about joint Additional Data Posting transmission providers post, on a daily planning between transmission basis, their actual daily peak load for the 193. Notwithstanding our proposed providers and their customers. For prior day? We believe that this posting reforms requiring greater consistency of example, we asked whether joint of forecasted and actual loads would and increased transparency into ATC planning should be made mandatory, allow the Commission and others to calculation methodologies, certain particularly when transmission requests make a meaningful comparison of these aspects of ATC calculation may remain affect adjacent transmission systems. elements. We invite comment on committed to the discretion of the We also inquired whether joint planning whether this information would be transmission provider. Thus, we believe should be subject to an annual reporting helpful for such a comparison. We also that additional reporting requirements requirement or audits. Additionally, we seek comment on the overall benefits of asked for comment on a number of may be necessary to detect undue posting metrics and on potential discrimination. Accordingly, we issues designed to determine whether alternative metrics. any pro forma OATT reforms are propose to add a requirement in our 195. For all of our proposed OASIS regulations for transmission providers to necessary to ensure that the reforms, we propose to require public transmission system is expanded so that post on OASIS certain metrics related to utilities, working through NAESB, to the provision of transmission service customers have adequate transmission develop standards for consistent service. As the comments below under the pro forma OATT. methods of posting the new Specifically, we propose to require indicate, commenters generally all requirements on OASIS so that a believe that joint and regional planning transmission providers to post data each common format is used. month concerning transmission service are necessary and desirable, but there is requests associated with particular B. Transmission Planning— a split over whether it should continue paths or flowgates that would clearly Coordinated, Open and Transparent to be voluntary or should be made a identify the number of requests that Planning requirement. have been accepted and the number of 196. Order No. 888 set forth certain Comments Supportive of Mandatory requests that have been denied during minimum requirements for transmission Joint and Regional Planning the prior month. The posted data would system planning. For example, the pro 198. A number of commenters show: (1) The number of non-affiliate forma OATT requires transmission contend that joint planning between requests for transmission service that providers to plan for the transmission transmission providers and their have been rejected and (2) the total needs of their network customers on a customers should be required by the pro number of non-affiliate requests for comparable basis (section 28.2), and it forma OATT. Most of these commenters transmission service that have been requires them to expand their systems to also advocate joint planning among made. This posting would distinguish accommodate firm point-to-point transmission providers in a given between the length of the service customer requests (sections 13.5 and region. In perhaps the strongest request (e.g., short-term or long-term 15.4) that cannot be satisfied due to comments on the topic, TDU Systems requests) and between the type of transmission constraints or satisfied and TAPS request that the Commission service requested (e.g., firm point-to- more economically via redispatch. In mandate an open, regional transmission point, non-firm point-to-point or addition, in Order No. 888–A, the expansion planning process that network service). We also propose that Commission encouraged utilities to provides opportunities for transmission the transmission provider post similar engage in joint planning with other customers to join and participate in the information for affiliate transactions. In utilities and customers and to allow planning process. Many other other words, the transmission provider affected customers to participate in commenters also support joint and would also post: (1) The number of facilities studies to the extent regional planning in some form or affiliate requests for transmission practicable. The Commission also service that have been rejected, and (2) encouraged regional planning so that 185 See id. the total number of affiliate requests for the needs of all participants are 186 Pro forma OATT section 21.2, ‘‘Coordination transmission service that have been represented in the planning process.184 of Third-Party System Additions,’’ provides for made. Similarly, this posting would However, the Commission did not certain rights for transmission providers to distinguish between the length of the require joint planning between coordinate construction of facilities on their systems associated with point-to-point customer service request (e.g., short-term or long- transmission providers and their requests and related construction on a third-party term requests) and between the type of transmission system, but imposes no obligation on service requested (e.g., firm point-to- 184 See Order No. 888–A at 30,311. transmission providers.

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another, with some focusing particularly of their customers.189 NRECA asserts planning to address the fact that on requiring such planning when that since the implementation of Order changes on one system often affect adjacent transmission systems are No. 888, a number of public utility transmission service on adjacent affected.187 Bonneville and Williams transmission providers—despite clearly systems.191 Lastly, APPA blames also assert that there is already stated obligations in the pro forma substantial and rising congestion costs Commission precedent for joint OATT—have not planned for their load- on inadequate transmission planning, planning in our procedures on large serving transmission customers on a and EPSA contends that better generator interconnections, which basis comparable to that of their own transmission planning is needed to require the coordination of studies bundled retail native load. TDU Systems support a competitive electricity market. believes that joint and regional when interconnection requests affect Comments Supportive of Voluntary transmission planning is a critical other systems. EPSA states that the Joint and Regional Planning Commission should require that component of ensuring comparability neighboring systems formalize the between a transmission provider’s use 202. Another large group of process under which broad regional of the transmission system and a commenters, including many investor- models are developed and used to study network customer’s use of the owned utilities, stress that joint and regional planning, while laudable, requests on any system within a broadly transmission system, largely because should not be mandatory and that it defined region. Powerex points out that transmission providers have an should continue to be voluntary or that the lack of regional transmission incentive to thwart the expansion processes are already in place to planning is one of the most difficult planning process. Both NRECA and encourage regional planning.192 issues faced in the Pacific Northwest, TDU Systems argue that the planning Progress Energy, for example, contends and PPL asserts that transmission processes in RTOs and ISOs also are that there are several formalized planning and expansion in the Western insufficient because they often only allow customer input after transmission processes in place today that foster joint Interconnection does not support a and regional planning, such as the competitive market. plans are developed by individual transmission providers. process in North Carolina. Southern 199. In addition, many commenters 201. TAPS asserts that the absence of points out that in addition to contend that transmission providers joint planning has resulted in unduly participating in Southeastern Electric should be required to report on an discriminatory transmission service. For Reliability Council (SERC) planning annual basis the joint and regional comparable service to be a reality, TAPS activities, it is engaged in other types of planning that has occurred or been asserts that the transmission system joint regional planning (e.g., through the requested.188 TAPS states that an annual must be planned and built for customer Georgia Integrated Transmission System filing notice by the Commission that needs, just as it must be planned and (Georgia ITS)).193 Nevada Companies gives the public an opportunity to built to meet the transmission providers’ supports the approach already used in comment should be buttressed with need to provide service to their native the WECC, which employs audits, in order to ensure that loads. Old Dominion contends that interconnection-wide models for transmission providers are taking joint transmission providers often locate planning. Nevada Companies explains planning with their network customers transmission in such a way that it favors that these studies are then made (and neighboring systems) seriously. their own generation. According to available to all other WECC EPSA likewise contends that Lafayette, transmission providers have transmission providers. In addition, transmission providers should be increased their generation dominance APS, Tacoma, and WAPA point to required to report to the Commission on by inadequately planning for the needs numerous forums (e.g., the Southwest an annual basis the joint planning that of their transmission customers so that Area Transmission planning group and has occurred or been requested on their they are unable to turn to alternative the Southwest Transmission Expansion systems, and that the Commission suppliers. East Texas Cooperatives also Plan process) where transmission should conduct audits to determine the argues that some transmission providers providers and other industry level of compliance with any joint continue to plan their systems in stakeholders coordinate their planning requirement or agreement. isolation from the needs of other load- transmission plans. LPPC also states 200. The commenters that advocate serving entities. EPSA concludes that that the Georgia ITS has provided mandatory joint and regional planning the transmission needs of non- benefits to participants and the region— assert that it is needed because transmission provider customers are in the form of improved investment in transmission providers unduly simply not integrated effectively into infrastructure and through the discriminate against their customers the planning process. APPA notes that introduction of new sources of capital. when planning their transmission the original goal of the pro forma 191 systems. For example, a number of OATT—an inclusive planning process E.g., Alcoa and EPSA. EEI acknowledges the that takes into account on a comparable planning difficulties that arise when a transmission commenters assert that transmission request on one system causes the need for upgrades providers meet their own needs for basis the load growth and new to another system. transmission planning and construction generation resource needs of all loads 192 E.g., Cinergy, Entergy, KCP&L, LPPC, before (and often without) meeting those served using the transmission provider’s MidAmerican, Nevada Companies, North Carolina system—has not been achieved. Many Commission, Northwestern, PNM–TNMP, Progress Energy, Salt River, Snohomish, South Carolina 187 E.g., AEP, Alcoa, APPA, Bonneville, Calpine, commenters assert that joint and Regulatory Staff, Southern, Tacoma, and WAPA. EPSA, Lafayette, National Grid, NCPA, NRECA, Old regional transmission planning is Nevertheless, KCP&L, Nevada Companies, and Dominion, Trans-Elect, Williams, and Xcel. Though necessary in order to ensure adequate Progress Energy join with EPSA in calling for a it does not generally support mandatory joint and infrastructure development.190 Others more formalized process for addressing base case regional planning, EEI recommends that the focus on the need for joint and regional and expansion plans. Commission modify the pro forma OATT to address 193 Georgia ITS consists of jointly-owned planning when transmission requests require transmission facilities, which are owned by the upgrades on or otherwise adversely affect adjacent 189 E.g., FMPA, Midwest Municipals, NCPA, and Southern subsidiary Georgia Power, the Municipal transmission systems. NRECA. Electric Authority of Georgia, the Georgia 188 E.g., East Texas Cooperatives, EPSA, FMPA, 190 E.g., AEP, Calpine, Constellation, East Texas Transmission Corporation—a cooperative utility— MidAmerican, and TAPS. Cooperatives, ELCON, NRECA, and TransAlta. and Dalton Utilities—a municipal system.

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Lastly, some commenters point out that System.’’ Section 28.2 also provides that The Need for Reform collaborative regional planning already the Transmission Provider shall, 206. As discussed more fully in Part 194 occurs in RTO and ISO regions. With consistent with Good Utility Practice, III.C above, in the ten years since Order regard to PJM, however, TDU Systems ‘‘endeavor to construct and place into No. 888 was issued, the Nation has argues that better transmission planning service sufficient transfer capability to witnessed a decline in transmission is required due to PJM’s ‘‘rubber- deliver the Network Customer’s investment relative to load growth. As a stamping’’ of transmission provider Network Resources to serve its Network result, transmission capacity per MW of identified transmission upgrades. Load on a basis comparable to the peak demand has declined in every Exelon states that the Northeastern ISO/ Transmission Provider’s delivery of its NERC region, and it has been estimated RTO Planning Coordination Protocol is own generating and purchased that capital spending must increase a formal agreement, executed in 2004, resources to its Native Load Customers.’’ significantly to ensure system reliability among the PJM Interconnection, the 205. The pro forma OATT also and to accommodate wholesale electric New York Independent System requires that new facilities be markets. Many have argued that Operator, and ISO New England, constructed to meet the service requests inadequate expansion of the pursuant to which the three of long-term firm point-to-point transmission grid has contributed to the organizations conduct a comprehensive customers. Section 13.5 of the pro forma widespread transmission constraints process of coordinating system planning OATT requires the transmission that plague most regions of the country, activities. provider to consider redispatch of the as reflected in the limited amounts of 203. With regard to the imposition of system to relieve any constraints that ATC posted in many regions, increased reporting requirements, many are inhibiting a transmission customer’s frequency of denied transmission commenters argue that transmission point-to-point service if it is economical services requests, and increasingly providers already are required to report to do so; but if redispatch is not common transmission service joint planning activities.195 EEI, for economical, the transmission provider interruptions or curtailments, all of example, contends that joint planning is obligated to expand or upgrade its which make it more difficult for activities under section 30.9 of the pro system. This expansion obligation on transmission customers to transfer forma OATT currently are required to the part of the transmission provider for power. In short, it has become clear that be reported on each transmission point-to-point service is found in since Order No. 888 was issued, the provider’s OASIS. EEI argues that audits section 15.4 of the pro forma OATT, Nation’s transmission grid has not been should not be required. Bonneville which provides that when a planned and developed adequately and contends that, at least in the Pacific transmission provider cannot projections suggest that without reform Northwest, annual reporting and audits accommodate a point-to-point this trend will continue. are not needed. Bonneville states that transaction because of insufficient 207. The need for transmission transmission planning staffs already capability on its system, it will ‘‘use due planning reform also has been bear a heavy workload; for example, diligence to expand or modify its recognized by the Consumer Energy Bonneville’s planning staff must address Transmission System to provide the Council of America (CECA), a public many requests for transmission and requested Firm Transmission Service.’’ interest energy policy organization with interconnection service, as well as Section 15.4 goes on to provide that a 30-year history of bringing conduct regional planning efforts and ‘‘the Transmission Provider will stakeholders together to find solutions comply with regional and national conform to Good Utility Practice in to contentious energy policy issues. reliability initiatives. Northwestern determining the need for new facilities CECA launched its Transmission states that reporting requirements or and in the design and construction of Infrastructure Forum in early 2004,197 audits are not needed and would be such facilities.’’ Importantly, however, which published its conclusions in burdensome to the transmission the transmission provider’s obligation to January 2005 in a final report titled provider, distracting it from performing upgrade or expand its system to provide ‘‘Keeping the Power Flowing: Ensuring its joint planning responsibilities. point-to-point service as detailed in a Strong Transmission System to section 15.4 is contingent on the Current pro forma OATT Planning Support Consumer Needs for Cost- transmission customer agreeing to Responsibilities Effectiveness, Security and Reliability’’ compensate the transmission provider (CECA Report).198 Among other things, 204. Order No. 888 and the pro forma for such costs pursuant to the terms of the CECA Report concludes that OATT require that transmission section 27 (providing for cost regional transmission planning with providers plan and upgrade their responsibility for upgrades and/or consumer input early in the process is transmission systems to provide redispatch ‘‘to the extent consistent needed to ensure the development of a comparable open access transmission with Commission policy’’). Order No. robust transmission system capable of service for their transmission customers. 888 does not, however, require that meeting consumer needs reliably and at For example, with regard to network transmission providers coordinate with service, section 28.2 of the pro forma either their network or point-to-point satisfied the need for transparency with regard to OATT provides that the transmission customers in transmission planning or transmission planning. provider ‘‘will plan, construct, operate otherwise publish the criteria, 197 The CECA Transmission Infrastructure Forum and maintain its Transmission System included representatives from such diverse assumptions, or data underlying their constituencies as investor-owned utilities, rural 196 in accordance with Good Utility transmission plans. electric cooperatives, municipal power systems, Practice in order to provide the Network federal power systems, independent power Customer with Network Integration 196 Certain transmission data is required to be producers, equipment manufacturers, the U.S. Transmission Service over the provided annually in the FERC Form 715 (e.g., Part Congress, the Commission, the U.S. Department of Transmission Provider’s Transmission 2—Power Flow Base Cases, Part 3—Transmitting Energy, state legislatures, state public utility Utility Maps and Diagrams, Part 4—Transmission commissions, state energy offices and consumer Planning Reliability Criteria, Part 5—Transmission advocates, consumer and environmental 194 E.g., Ameren, CAISO, Exelon, ISO New Planning Assessment Practices, and Part 6— organizations, independent consultants, and England, and MidAmerican. Evaluation of Transmission System Performance). academic institutions. 195 E.g., Bonneville, EEI, KCP&L, PNM–TNMP, As discussed below, we do not believe that the 198 Available at http://www.cecarf.org/ Salt River, Tacoma, and WAPA. FERC Form 715 reporting requirements have Publications/PublicationsAllDate.html.

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reasonable cost over time. The CECA to increase the import or export capacity transmission providers and their Report stresses that regional of its transmission system if doing so customers for purposes of planning. The transmission planning must address would allow cheaper power to displace Commission has a duty to prevent inter-regional coordination, the need for its higher cost generation or otherwise undue discrimination in the rates, both reliability and economic upgrades make new entry more profitable by terms, and conditions of public utility to the system, as well as critical facilitating exports. transmission service, and therefore, an infrastructure to support national 209. The existing pro forma OATT obligation to remedy these transmission security and environmental concerns.199 does not adequately address the above- planning deficiencies. The 208. Transmission providers have a referenced problems. As noted, there is Commission’s authority to remedy disincentive to remedy transmission no general requirement that a undue discrimination is broad.203 In congestion when doing so reduces the transmission provider coordinate its addition, new section 217 of the FPA value of their generation or otherwise transmission planning with customers, requires the Commission to use its FPA stimulates new entry or greater market participants, or its authorities in a manner that facilitates competition in their area. As the interconnected neighbors.202 the planning and expansion of Commission noted in Order No. 888, Additionally, though the pro forma transmission facilities to meet the ‘‘[i]t is in the economic self-interest of OATT does require transmission reasonable needs of load-serving transmission monopolists, particularly providers to plan for the needs of their entities. Finally, we note that a more those with high-cost generation assets, network customers and to expand their transparent and coordinated regional to deny transmission or to offer systems to provide service to point-to- planning process can support the DOE’s transmission on a basis that is inferior point customers, there is no requirement responsibilities under EPAct 2005 to that which they provide that the overall transmission planning section 1221 to study transmission themselves.’’ 200 This statement process be open to customers, congestion and issue reports designating continues to be true today. In upholding competitors, and state commissions. National Interest Transmission the Commission’s authority to require Rather, the transmission provider Corridors. open access in Order No. 888, the court currently is allowed to create its own 211. We are encouraged that since the in TAPS v. FERC noted that ‘‘[u]tilities transmission plan with limited or no adoption of open access in Order No. that own or control transmission input from affected market participants 888, a number of voluntary coordinated facilities naturally wish to maximize or other affected entities, such as state and regional planning efforts have been profit. The transmission-owning utilities commissions. There is also no developed throughout the country, thus can be expected to act in their own requirement that the planning process including those administered by RTOs interest to maintain their monopoly and be transparent. While we recognize that and ISOs. For example, each of the to use that position to retain or expand certain planning information is required Commission-approved RTOs in the the market share for their own generated to be filed annually in FERC Form No. Northeast, Midwest and Southwest, as electricity, even if they do so at the 714—Annual Electric Control and well as CAISO, provide for a expense of lower-cost generation Planning Area Report and FERC Form coordinated and regional planning companies and consumers.’’ 201 Thus, 715—Annual Transmission Planning process with stakeholder input from even when transmission providers do and Evaluation Report, this does not each industry segment. The Commission address congestion, they have an appear to provide sufficient also notes that there are several other incentive to do so in a manner that transparency to remedy the remaining promising efforts to establish voluntary benefits their own generation or loads concerns expressed in this proceeding coordinated and regional planning rather than the generation or loads of about the potential for undue efforts around the country. For example, their competitors. These disincentives discrimination in planning. WECC is in the process of expanding its frustrate new investment that could 210. Taken together, this lack of reliability responsibilities to include remedy both ‘‘local’’ congestion (i.e., coordination, openness, and comprehensive transmission planning within the transmission provider’s transparency results in opportunities for to address the regional economic control area) and congestion between undue discrimination in transmission transmission needs of its members and control areas, as well as remedy undue planning. Without adequate other stakeholders in its regional discrimination and increase bulk power coordination and open participation, footprint. In addition, each of the trade. For example, a transmission market participants have no input into subregions in WECC has a coordinated provider does not have an incentive to whether a particular plan treats all loads transmission planning process that, in relieve local congestion that restricts the and generators comparably. Without varying degrees, is open to market output of a competing merchant sufficient transparency, market participants and, in some instances, has generator if doing so will make the participants have no means to resulted in significant new transmission transmission provider’s own generation determine whether the plan developed being built on a joint ownership basis. less competitive. A transmission by the transmission provider in In North Carolina, Duke, Progress provider also does not have an incentive isolation is discriminatory. Moreover, Energy, and two other organizations— the process is inefficient. Disputes over North Carolina Electric Membership 199 See, e.g., CECA Report at 10–11. discrimination occur primarily after-the- Corporation and ElectriCities of North 200 Order No. 888 at 31,682. fact because there is insufficient Carolina, Inc.—have endeavored to 201 225 F.3d at 684; see also New York v. FERC, 535 U.S. at 8–9 (addressing Order No. 888’s open coordination and transparency between create and implement a collaborative access requirements, the Court noted that ‘‘public electric transmission planning process utilities retain ownership of the transmission lines 202 As discussed more fully in Part V.C.2, section in that state. This process provides for that must be used by their competitors to deliver 30.9 of the current pro forma OATT may inhibit broad stakeholder input as well an electric energy to wholesale and retail customers. coordinated planning by making transmission The utilities’ control of transmission facilities gives providers reluctant to engage in coordinated independent facilitator. Other models them the power either to refuse to deliver energy planning, because of the requirement to give produced by competitors or to deliver competitors’ customers credits for jointly planned facilities. We 203 See Order No. 888 at 31,669 (noting that the power on terms and conditions less favorable than are proposing to sever the link between credits and FPA ‘‘fairly bristles’’ with concern for undue those they apply to their own transmissions.’’) planning, and treat the two issues separately within discrimination (citing Associated Gas Distributors (citation and footnote omitted). the pro forma OATT. v. FERC, 824 F.2d 981, 998 (D.C. Cir. 1987)).

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for coordinated planning include the proceeding, a proposal for a coordinated planning for their native load; and Georgia ITS and joint ownership and regional planning process that point-to-point customers are required to arrangements like it around the country. complies with the following submit any projections they have of a 212. We fully support these voluntary coordinated and regional planning need for service over the planning efforts and believe they are consistent in principles.204 In the alternative, horizon and at what receipt and significant respects with the nature of transmission providers may make a delivery points. The Commission seeks the reforms we are proposing for compliance filing in this proceeding comment on whether specific transmission planning under the pro describing their existing coordinated requirements should be adopted for this forma OATT. In those regions and and regional planning process and information exchange.205 The subregions that already have adopted showing that it is consistent with or transmission provider must allow significant reforms, our proposal may superior to the requirements set forth market participants the opportunity to require only modest changes, while below. Moreover, we expect municipal, review and comment on draft other regions and subregions may need cooperative, and other public power transmission plans. to undertake more significant changes to entities to participate in these processes 5. Comparability—After considering the way in which the transmission as well, consistent with their obligation the data and comments supplied by system is planned today. to provide reciprocal transmission market participants, the transmission 213. Today, numerous competing service as detailed in Order No. 888. An provider is to develop a transmission interests have a need to utilize the open and transparent regional planning system plan that: (1) Meets the specific transmission grid, and yet in many areas process cannot succeed unless all service requests of its transmission of the country that grid is planned much transmission owners participate. customers; and (2) otherwise treats the same way as it was before the Under our proposal in this NOPR, a similarly situated customers (e.g., electric industry matured into a regional coordinated, open and transparent network and retail native load) business and Order No. 888 was process must satisfy the following eight comparably in transmission system implemented. That is, the same public principles: planning. utilities that own and control the grid 1. Coordination—The transmission 6. Dispute Resolution—The also control the planning process that provider must meet with all its transmission provider must propose a governs when and how the grid is transmission customers and dispute resolution process, such as expanded and upgraded. In short, the interconnected neighbors to develop a requiring senior executives to meet prior transmission grid is being utilized in a transmission plan on a to the filing of any complaint and using fundamentally different way, consistent nondiscriminatory basis. The a third-party neutral. The Commission’s with the intent of open access, and a Commission seeks comment on specific Dispute Resolution Service is available decade of experience has shown us that requirements for this coordination, such to assist transmission providers in in order to remedy undue as the minimum number of meetings to developing a dispute resolution process. discrimination, the existing provisions be required each year, the scope of the In addition to informal dispute of the pro forma OATT respecting meetings, the notice requirements, the resolution, affected parties would have transmission system planning must be format, and any other features deemed the right to file complaints with the reformed. Accordingly, in order to important by commenters. Commission under FPA section 206. provide for more comparable open 2. Openness—Transmission planning The Commission seeks comment on access transmission service, eliminate meetings must be open to all affected whether any specific dispute resolution the potential for undue discrimination parties (including all transmission and processes should be required. and anticompetitive conduct, and interconnection customers, and state 7. Regional Participation—In addition satisfy our statutory responsibilities commissions). The Commission seeks to preparing a system plan for its own under section 217 of the FPA, we comment on whether there are any control area on an open and propose that each public utility circumstances under which nondiscriminatory basis, the transmission provider participate in an participation should be limited, e.g., to transmission provider is required to open and transparent local and regional address confidentiality concerns. coordinate with interconnected systems planning process that addresses certain 3. Transparency—The transmission to: (1) Share system plans to ensure that fundamental principles of transmission provider is required to disclose to all they are simultaneously feasible and planning. As we indicated above, customers and other stakeholders the otherwise use consistent assumptions existing regional planning processes basic criteria, assumptions, and data and data, and (2) identify system will be expected to meet or exceed the that underlie its transmission system enhancements that could relieve transmission planning principles we plans. The Commission seeks comment ‘‘significant and recurring’’ transmission outline in this proposed rule. on whether the information provided in congestion (defined below). The Commission strongly encourages that FERC Form 715 is adequate and, if not, Coordinated, Open, and Transparent such coordination encompass as broad a what additional detail should be Transmission Planning region as possible, given the provided. The Commission also seeks 214. In order to eliminate the interconnected nature of the comment on the format for disclosure, potential for undue discrimination as transmission grid and the efficiency of including protections to address described above, and to ensure that addressing these issues in a single confidentiality concerns. comparable transmission service is 4. Information Exchange—Network forum. The Commission also recognizes provided by all public utility transmission customers are required to that, as in the West, it may be transmission providers, including RTOs submit information on their projected appropriate to organize regional and ISOs, we propose to amend the pro loads and resources on a comparable planning efforts on both a subregional forma OATT to require coordinated, basis (e.g., planning horizon and format) 205 open, and transparent transmission as used by transmission providers in For network service, some of this information planning on both a local and regional already is required by sections 29, 30 and 31 of the pro forma OATT, but to the extent it is not, we level. We propose to require each public 204 The revised pro forma OATT reflects the propose to require customers to provide additional utility transmission provider to submit, proposed planning requirement in sections 15.4, information as necessary for the transmission as part of its compliance filing in this 16.1, 17.2(x), 28.2, 29.2, 31.6, and Attachment K. provider to develop a system plan.

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and regional level. The Commission transmission planning processes being comment on whether to include such a seeks comment on whether there are proposed in this NOPR. The requirement and, if so, what conditions existing institutions (such as the NERC participation and support of state or limitations should be associated with regional councils or subregional commissions and other state agencies is it. planning groups) that are well situated important because state commissions c. We further seek comment on to perform or coordinate this function. regulate the cost of transmission that is whether there should be a specific study 8. Congestion Studies—The included in bundled retail rates and process to identify opportunities to transmission provider is required states also perform transmission siting. enhance the grid for purposes beyond annually to prepare studies identifying Many states also have traditionally been maintaining reliability or reducing ‘‘significant and recurring’’ congestion involved in utility planning in some current congestion. Such a process and post such studies on its OASIS. The way for their state or region. The would allow interested entities, studies should analyze and report on Commission seeks comment on how including state resource agencies, siting the location and magnitude of the best to accommodate effective state bodies and commissions, load-serving congestion; possible remedies for the participation. entities, or other market participants to elimination of the congestion, in whole 217. The Commission seeks comment request that the transmission provider or in part; the associated costs of on several aspects of this proposal. First, model grid upgrades needed to congestion; and the cost associated with the Commission seeks comment on how accommodate the construction of new relieving congestion through system much flexibility each transmission resources, e.g., remote coal, nuclear or enhancements (or other means). The provider in a region should be given in wind on a local and regional basis and Commission seeks comment on how to implementing any principles adopted. prior to the existence of an actual define ‘‘significant and recurring’’ Second, the Commission seeks proposal for such resources. Such a congestion, such as by reference to comment, by way of examples, on process could provide the information generation redispatch, repeated denials transmission planning processes that necessary to allow interested entities to of service requests, zero ATC, frequent comply with the proposed transmission proactively evaluate, on a curtailments or a combination of these planning reforms in principle. nondiscriminatory basis, different factors. The required congestion studies 218. Third, we seek comment on resource options in light of the differing would address both ‘‘local’’ congestion whether there are other principles or transmission infrastructure needs (i.e., within the transmission provider’s requirements that should be adopted to associated with them. We recognize that system) and congestion between control support the construction of needed new resource planning is traditionally areas and subregions. The purpose of infrastructure and otherwise ensure that performed at the state level and do not this requirement is to ensure that all market participants are treated on a believe that any such study process affected market participants, state comparable basis. For example: would conflict with these state commissions, and this Commission a. We seek comment on whether there prerogatives. To the contrary, we believe understand both the costs of recurring should be a principle or guideline to such a study process could provide transmission congestion and the govern the recovery and allocation of states better information to evaluate all remedies. The Commission seeks costs associated with funding the relevant resource options in exercising comment on how this information regional planning requirement. To their resource adequacy authority. should be used by the transmission devote the resources necessary to d. We also seek comment on whether provider and market participants to support an open and transparent we should require public utilities to address significant and recurring regional planning process, we recognize develop cost allocation principles to congestion. that the participating entities must be address the sharing of the costs of new 215. The Commission encourages the assured of recovery of their costs, as transmission projects. Would the use of an independent third party to well as assured that the costs will be development of specific cost allocation oversee or coordinate the planning borne equitably by all parties benefiting principles provide greater certainty and process. The Commission is not from the process. hence support the construction of new proposing to require an independent b. We seek comment on whether there infrastructure? Or is cost allocation third party to control the process, but should be a requirement that, at least for better handled on a case-by-case basis? does believe that independence can large new transmission projects (such as We also seek comment on how, as part provide greater confidence in the new regional backbone facilities), there of any cost allocation process, to planning process and resulting studies. be an open season to allow market address the fact that upgrades that may Independence can take many forms, participants to participate in joint not be needed for reliability in the near from having an independent entity term (e.g., 3–5 years) may be necessary resolve disputes over planning ownership of these projects. We believe to support reliability in the longer term assumptions and decisions (as in an that such a requirement could stimulate (e.g., 10–15 years). Furthermore, RTO) to having an independent more investment in the grid and ensure because transmission upgrades, consultant coordinate and otherwise that all customers have the ability to particularly multi-state regional perform the annual congestion studies participate in new projects on a referred to above. The Commission nondiscriminatory basis, including backbone facilities, often can require 10 seeks comment on the levels of smaller market participants that cannot to 15 years to construct, we seek independence that can provide benefits support the construction of large new comment on whether the planning 206 and the institutions that could offer facilities on their own. We seek process proposed here should be such independence, such as whether 206 We note that transmission providers in the expenses in proportion to their ownership Regional Entities under the ERO could Western Interconnection already participate in percentage in each project. Additionally, all owners provide such independence. regional and sub-regional transmission planning participate in the oversight and administration of 216. Additionally, the Commission processes that include the opportunity for joint jointly-owned projects through representation on strongly encourages the participation of financing and ownership of transmission facilities. various administration committees. Among other Such facilities are typically owned by the benefits, this has allowed all participating utilities, state commissions and other state participants as ‘‘tenants in common’’ with each large and small, to take advantage of the economies agencies, particularly with regard to participant owning a pro rata share of the land and of scale associated with larger transmission regional planning, in the coordinated common facilities and sharing the costs and projects.

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required to look out at least as far as the transaction does not overly burden of decremental costs for overscheduling, longest time it would take to build such another.212 or (2) the greater of a percentage of an upgrade in the region in question. 223. With respect to compensation system costs or a fixed charge, such as 219. Finally, the Commission seeks associated with the hourly energy $100 per MWh.218 deviation band, the Commission comment on the level of detail to be Generator Imbalances required in transmission providers’ explained that for energy imbalances OATTs. within the deviation band, the 225. While the Commission found in transmission customer may make up the Order No. 888 that energy imbalance C. Transmission Pricing difference within 30 days (or other was an ancillary service, it also 220. Order No. 888 and the pro forma reasonable period generally accepted in recognized that differences arise OATT included primarily non-rate the region) by adjusting its energy between energy scheduled for delivery terms and conditions of open access deliveries to eliminate the imbalance from a generator and the amount of 219 non-discriminatory transmission (i.e., return energy in kind within 30 energy actually generated in an hour, service. The Commission required days).213 In addition, the Commission commonly called generator imbalance. transmission providers to propose explained that the transmission It concluded, however, that a generator corresponding rates in a subsequent customer must compensate the should be able to deliver its scheduled filing under FPA section 205. Similarly, transmission provider for each hourly energy with precision and here we do not propose to undertake a imbalance that exceeds the hourly expressed concern that if it were to comprehensive overhaul of our deviation band and for accumulated allow the generator to deviate from its transmission pricing policies. We do, minor imbalances that are not made-up schedule by 1.5 percent without 214 however, propose a number of reforms within 30 days. With respect to the penalty, so long as it returned the to several discrete provisions in the pro price of energy imbalance service, the energy in kind at another time, it would forma OATT, as further described Commission explained that it discourage good generator operating practices.220 The Commission stated below. We also provide a clarification of intentionally did not provide detailed 215 that a generator’s interconnection our policy for pricing of system pricing requirements. Instead, the agreement with its transmission expansions. Commission required transmission providers to propose rates for energy provider or control area operator should 1. Imbalances imbalance service.216 specify the requirements for the Energy Imbalances 224. Although transmission providers generator to meet its schedule and any have different energy imbalance consequence for persistent failure to 221. In Order No. 888, the charges, they typically require meet its schedule.221 Commission concluded that six customers to correct energy imbalances 226. Subsequently, however, the ancillary services must be included in within the deviation band through Commission, in a number of cases, an OATT.207 One of those ancillary return in kind or a financial settlement accepted modifications to a services is energy imbalance service that requires payment for transmission provider’s OATT to under Schedule 4 of the pro forma underdeliveries of energy equal to 100 include generator imbalance OATT.208 Energy imbalance service is percent of the transmission provider’s provisions.222 Moreover, in Order No. provided when the transmission system incremental cost for the hour the 2003–B, the Commission permitted the provider makes up for any difference deviation occurred. For energy transmission provider to include a that occurs over a single hour between overdeliveries, the transmission provision for generator balancing the scheduled and the actual delivery of customer would receive a payment service arrangements in individual energy to a load located within its equal to 100 percent of the transmission interconnection agreements.223 Further, control area.209 The Commission provider’s decremental cost for the hour in a NOPR concerning generator recognized that the amount of energy the deviation occurred.217 Outside the imbalance provisions for intermittent taken by load in an hour is variable and deviation band, transmission providers resources, the Commission proposed to not subject to the control of either a either charge the transmission customer: establish a standardized schedule under wholesale seller or a wholesale (1) A percentage of the utility’s system the pro forma OATT to address requirements buyer.210 cost, such as 110 percent of incremental generator imbalances created by 222. The Commission found that the costs for underscheduling or 90 percent energy imbalance service should have 218 See Arizona Electric.; see also Idaho Power an energy deviation band appropriate 212 Id. at 30,232. Co., 102 FERC ¶ 61,351 (2003); see also Duke 213 Id. at 30,229. Electric Transmission FERC Electric Tariff, Third for load variations and a price for Revised Volume 4, Original Sheet No. 120 accepted 214 Id. The Commission further stated that the pro in Duke Energy Corp., Docket No. ER04–812–001 exceeding the deviation band that is forma OATT permits schedule changes up to (Jul. 2, 2004) (unpublished letter order). appropriate for excessive load twenty minutes before the hour at no charge, and 219 variations.211 The deviation band that it would allow the transmission provider and Order No. 888–A at 30,230. 220 established by the Commission is an the customer to negotiate and file another deviation Id. ± band more flexible to the customer, if the same 221 Id. hourly deviation band of 1.5 percent deviation band is made available on a not unduly 222 See, e.g., Niagara Mohawk Power Corp., 86 (with a minimum of 2 MW) for energy discriminatory basis. Id. at 30,232–33. FERC ¶ 61,009 (1999) (Niagara Mohawk); imbalance. The Commission explained 215 Id. at 30,234. PacifiCorp, 95 FERC ¶ 61,145, order on reh’g and that this deviation band promotes good 216 Id. clarification, 95 FERC ¶ 61,467 (2001); Alliant scheduling practices by transmission 217 See, e.g., Arizona Public Service Co., FERC Energy Corporate Services, Inc., 93 FERC ¶ 61,340 Electric Tariff, Twelfth Revised Volume No. 2, (2000); Wolverine Power Supply Coop., 93 FERC customers, which ensures that the Schedule 4 (Energy Imbalance Charge), accepted in ¶ 61,330 (2000); Commonwealth Edison Co., 93 implementation of one scheduled Arizona Public Service Co., Docket No. ER04–442– FERC ¶ 61,021 (2000); FirstEnergy Operating Cos., 003 (Sep. 30, 2004) (unpublished letter order); 93 FERC ¶ 1,200 (2000), order denying reh’g & granting clarification, 94 FERC ¶ 61,184 (2001); 207 Public Service Company of New Mexico, FERC Order No. 888 at 31,703. Tampa Electric Co., 90 FERC ¶ 61,330 (2000), reh’g 208 Electric Tariff, Second Revised Volume No. 4., Id. Schedule 4 (Energy Imbalance Charge), accepted in denied, 95 FERC ¶ 61,101 (2001); Florida Power 209 See id. at 31,960. Public Service Co. of New Mexico, Docket No. Corp., 89 FERC ¶ 61,263 (1999); Consumers Energy 210 Order No. 888–A at 30,230. ER04–416–002 (Sep. 30, 2004) (unpublished letter Co., 87 FERC ¶ 61,170 (1999). 211 Id. order). 223 Order No. 2003–B at P 74–75.

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intermittent resources and to clarify the should be priced, and whether a 231. Constellation argues that the application of the current energy generator imbalance provision should Commission should eliminate energy imbalance provision of the pro forma be included as a schedule in the pro imbalance penalties and require that OATT.224 In particular, the Commission forma OATT rather than in generator imbalances be netted across all proposed that generator imbalance interconnection agreements.229 suppliers and with respect to each provisions for intermittent resources customer. EPSA contends that would reflect a deviation band of ±10 Comments imbalances outside the deviation band percent (with a minimum of 2 MW) and 229. Many commenters assert that the should be netted on a system-wide basis allow net hourly intermittent generator deviation band of 1.5 percent for energy and settled at incremental costs. imbalances within the deviation band to imbalances continues to be appropriate. Snohomish states that it prefers an be settled at the system incremental cost EEI argues that the deviation band for approach that provides for netting and at the time of the imbalance.225 The energy imbalance service is reasonable penalizes intentional deviation. Nevada Commission also reiterated its policy because it appropriately balances the Companies explains that its energy that a transmission provider may only need to protect transmission system imbalance tariff nets all negative and charge the transmission customer for reliability and the need for operational positive imbalances such that penalties either hourly generator imbalances or flexibility. LG&E argues that the are only invoked if there is a net hourly energy imbalances for the same deviation band of ±1.5 percent and positive or a net negative imbalance imbalance, but not both. associated penalties for transactions that outside of the deviation band. PPL also 227. A variety of different deviation fall outside this band are an appropriate advocates that the Commission should bands and pricing methods are on file means of disciplining market allow suppliers the flexibility to net and for generator imbalances. Rates for participants. Southern argues that trade imbalances in areas where no generator imbalance underdeliveries allowing a larger deviation band could imbalance market exists. range from the greater of $100/MWh or encourage gaming and leaning on the 232. Duke contends that requiring 110 percent of system incremental cost system, which ultimately would transmission providers to supply to the greater of $150/MWh or 200 jeopardize reliability. Southern adds imbalance service at a system percent of the incremental cost.226 that allowing deviations of more than incremental cost may eliminate the Generator imbalance rates for 1.5 percent without penalty could erroneous perception that the existing overdeliveries range from 90 percent 227 cause, among other things, inefficient charges are discriminatory, but such an of system decremental cost to 50 use of generation resources and approach does nothing to solve the percent 228 of the decremental cost. inappropriate cost shifting from those problems that imbalances cause, nor 228. In the NOI, we asked several most able to control imbalances to those does such an approach reflect the actual questions about the need to modify the lacking such control. costs of leaning on and dumping on the treatment of energy and generator 230. Several commenters assert that system. A number of commenters argue imbalances. For example, with respect the deviation band for energy that penalties should be imposed to energy imbalances, the Commission imbalances should be modified. APPA because without penalties there is asked whether the deviation band of insufficient economic incentive for ± argues that imbalances outside the 1.5 percent continues to be appropriate deviation band currently must be paid transmission customers to properly and whether penalty charges should be off at rates that often bear no schedule and, as such, reliability could eliminated entirely for transmission resemblance to the actual cost that the be harmed.230 WAPA states that if a customers, or whether transmission transmission provider likely incurs to balancing authority has very limited customers should be charged no more deal with the imbalance. APPA generation capacity (either physical or than the control area’s cost of supplying recommends revising Schedule 4 to market) available for the provision of energy to correct the imbalance. With increase the deviation band and to energy imbalance service, the respect to generator imbalances, the institute a graduated series of increasing assessment of penalties is warranted in Commission asked if comparability in penalties outside of the expanded order to establish a disincentive to the treatment of generator imbalances is deadband. Public Power Council states improper behavior that potentially may needed, how generator imbalances that there is no forecast model that affect reliability. accurately predicts actual fluctuations 233. Powerex notes that some 224 Imbalance Provisions for Intermittent in loads within the deviation band and mechanism should be in place that Resources; Assessing the State of Wind Energy in distinguishes between intentional or Wholesale Electricity Markets, Notice of Proposed therefore penalties will not induce Rulemaking, 70 FR 21349 (Apr. 26, 2005), FERC parties to schedule more accurately. repeated deviations and unit outages or Stats. & Regs. ¶ 32,581 at P 9 (2005) (Imbalance Public Power Council states that the 1.5 force majeure events and argues that Provisions Proceeding). percent deviation band encourages penalties should be tiered so that they 225 The Commission defined incremental cost as increase exponentially as a generator’s ‘‘the transmission provider’s actual average hourly loads to over-schedule and encourages cost of the last 10 MW dispatched to supply the the Commission to either expand the imbalances increase. transmission provider’s native load, based on the deviation band or adopt a multi-band 234. With regard to generator replacement cost of fuel, unit heat rates, start-up imbalances, EEI, Entergy, MidAmerican, costs, incremental operation and maintenance costs, system similar to the one Bonneville has in place. Snohomish notes that and Southern contend that the and purchased and interchange power costs and Commission should continue its current taxes.’’ Id. at P 9 n.17 (citing Consumers Energy Co., Bonneville has two deviation bands 87 FERC ¶ 61,170 at 61,179 (1999). beyond the 1.5 percent that have greater policy, as established in Order No. 2003, 226 See Duke Energy Corp., Docket No. ER05–855– penalties when customers cannot of requiring that generator imbalances 000 (Dec. 20, 2005) (unpublished letter order) be addressed either in the OATT or in (accepting Duke Electric Transmission’s Large manage their energy imbalances within the first deviation band and states that the generator interconnection Generator Interconnection Agreement with Power agreement. EEI, MidAmerican and Ventures Group, LLC (Duke Delegated Letter this approach seems equitable because it Order)). gives customers the proper incentives to Entergy contend that the Commission 227 See Entergy Services, Inc., 90 FERC ¶ 61,272 keep their schedules accurate. (2000) (concerning various generator imbalance 230 E.g., MidAmerican, NorthWestern, PacifiCorp, agreements). PNM–TNMP, Powerex, Progress Energy, Salt River, 228 See Duke Delegated Letter Order. 229 NOI at P 31. and Southern.

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should retain the flexibility of provisions.231 East Texas Cooperatives balance the needs of transmission transmission providers to deal with the argue that control area utilities, providers to operate their transmission issue of generator imbalances on a case- moreover, enjoy a double benefit systems in a reliable manner with the by-case basis, subject to the requirement because: (1) They are not subject to needs of transmission customers to have that they do not engage in unduly penalties themselves, and (2) the control reasonable access to those systems at discriminatory or preferential treatment area operator’s own generation is used just and reasonable rates, as well as the with respect to other generators on the to provide imbalance service to the needs of a variety of transmission system. Calpine contends that requiring other transmission customers in the customers with different generator transmission providers to treat generator control area. TAPS asserts that sources. imbalances in the pro forma OATT in comparability requires affording 239. To achieve this, the Commission the same way regardless of the transmission dependent utilities the proposes to create new energy and generator, and in all control areas, same return-in-kind treatment control generator imbalance schedules based on would provide greater certainty and areas use for inadvertent energy. It the following three principles: (1) The consistency for generators and help to maintains that, at a minimum, the charges must be based on incremental eliminate the opportunity for Commission should eliminate the $100/ cost or some multiple thereof; (2) the transmission providers to engage in MWh penalty, except in egregious charges must provide an incentive for discriminatory behavior. Bonneville circumstances and/or the Commission accurate scheduling, such as by argues that its three-tiered pricing and should expand the return-in-kind increasing the percentage of the adder penalty approach for energy imbalances deviation band substantially. above (and below) incremental cost as also is appropriate for generator 237. EEI and Entergy, on the other the deviations become larger; and (3) the imbalances. hand, argue that inadvertent energy and provisions must account for the special energy imbalances are not comparable circumstances presented by intermittent 235. PNM–TNMP states that the 1.5 and should thus be treated differently. percent deviation band for imbalance generators and their limited ability to EEI states that a NERC-certified control precisely forecast or control generation service continues to be appropriate area is responsible for supporting the except for intermittent resources. For levels, such as waiving the more reliability of its own area as well as punitive adders associated with higher those resources, it maintains, imbalance supporting the reliability of the deviations. energy costs should not be punitive, but interconnected power system grid. EEI 240. Bonneville has taken an energy rather should be designed to allow the explains that the inadvertent energy that transmission provider to recover its full imbalance pricing approach that a control area experiences reflects the appears consistent with the three costs of providing the generator moment-by-moment netting of load, imbalance service. NRECA urges the principles outlined above and seems to generation and schedules into or out of be working well. Bonneville’s imbalance Commission not to revise imbalance the control area, and that inadvertent provisions in a manner that singles out pricing approach is based on a three- energy reflects the loads, generator tiered deviation band that would appear wind generators for preferential output and schedules of all entities treatment. Northwestern, on the other workable for both energy imbalance within the control area, and not simply service and generator imbalance service. hand, argues that a generator imbalance the loads and generation of the Under this proposal, imbalances of less service schedule should be included in transmission provider. Entergy explains than or equal to 1.5 percent of the the pro forma OATT for intermittent that control area interchange imbalances scheduled energy (or two megawatts, resources and the service should not may involve the failure of control areas whichever is larger) would be netted on apply to traditional generators. to match their scheduled inflows and a monthly basis and settled financially 236. Commenters argue that the outflows due to contingencies occurring at 100 percent of incremental or treatment of imbalances should be made even in another control area.232 decremental cost at the end of each comparable with the treatment of Discussion month. Imbalances between 1.5 and 7.5 inadvertent energy for transmission percent of the scheduled amounts (or providers. APPA argues that Schedule 4 238. The existing energy imbalance two to ten megawatts, whichever is raises concerns about discriminatory charges under Schedule 4 of the pro larger) would be settled financially at 90 treatment because Schedule 4 is not forma OATT and the generator percent of the transmission provider’s applicable to OATT transmission imbalance charges described in Order system decremental cost for providers, who clear their imbalances No. 2003 are the subject of significant overscheduling imbalances that require through the use of inadvertent concern and confusion in the industry. the transmission provider to decrease interchange, if they operate their own The Commission is concerned about the generation or 110 percent of the control areas. TDU Systems contend variety of different methodologies used incremental cost for underscheduling that transmission providers that operate for determining imbalance charges and imbalances that require increased control areas hold a competitive whether the level of the charges generation in the control area. advantage over non-control area provides the proper incentive to keep Imbalances greater than 7.5 percent of operators solely by virtue of the fact that schedules accurate without being the scheduled amounts (or 10 they have access to balancing options, excessive. The Commission proposes to megawatts, whichever is larger) would such as inadvertent interchange, that are modify the current pro forma OATT be settled at 75 percent of the system not available to all market participants, Schedule 4 treatment of energy decremental cost for overscheduling including customers of the transmission imbalances and to adopt a separate pro imbalances or 125 percent of the providers. TDU Systems argue that this forma OATT schedule for the treatment incremental cost for underscheduling advantage can be decisive when sellers of generator imbalances. More imbalances. Intermittent resources are that do not operate control areas try to specifically, the Commission seeks to exempt from the third-tier deviation compete with control area operators for band and would pay the second-tier sales to entities concerned about 231 Accord APPA, Constellation, EPSA, Steel Manufacturers Association, and TAPS. deviation band charges for all deviations exposure to the penalties imposed 232 Accord Progress Energy, Salt River, and greater than the larger of 1.5 percent or under existing imbalance tariff Southern. two megawatts.

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241. The Commission seeks comment additional commitments are needed). be pursued under FPA section 215 as on whether this approach should be The Commission seeks comment on part of the review of reliability adopted for inclusion in the pro forma how such charges should be calculated, standards? OATT for energy and generator as well as how they would be applied 246. Furthermore, we propose to add imbalances. Does this approach provide to transmission customers. How should provisions to schedule 4—Energy sufficient incentives to ensure that additional demand and energy costs, if Imbalance Service and schedule 9— transmission systems can be operated in incurred in responding to imbalances, Generator Imbalance Service of the pro a reliable manner and ensure that such as redispatch, commitment, or forma OATT to reflect the Commission’s customers are treated in a just and additional regulation reserves be policy that a transmission provider may reasonable manner? appropriately reflected in the only charge a transmission customer for 242. We note that the Bonneville calculation of imbalance charges and either hourly generator imbalances or provision allows for greater charges which customers should be charged for hourly energy imbalances for the same when a customer has an ‘‘intentional such costs? Who should receive any imbalance, but not both.236 We also deviation.’’ 233 We seek comment on additional revenue from the charges clarify that this policy only applies to a whether the pro forma OATT imbalance above incremental costs? transmission customer that otherwise provision should provide for penalties 245. The Commission proposes to would be charged for both generator for behavior that represents deliberate continue to allow inadvertent energy to imbalances and energy imbalances for reliance on the transmission provider’s be treated differently than energy and the same imbalance occurring within generation resources, as opposed to generator imbalances.235 The the same control area. scheduling errors, with such penalties Commission believes that these two 247. Finally, the Commission seeks being subject to prior notice and types of service are not comparable. comment on whether or not it is approval by the Commission and based Inadvertent energy represents the appropriate to allow a transmission on the facts and circumstances of the difference between a control area’s net customer to net energy and generator individual transmission provider. actual interchange and the net imbalances for a particular transaction 243. If the Commission adopts revised scheduled interchange. It is caused by within a single control area to the extent energy and generator imbalance the combined effects of all the they offset. For example, if a schedules consistent with the principles generation and loads in the control area transmission customer schedules 100 proposed in this NOPR, that would and not simply the loads and generation MWh over an hour but has a load of 120 eliminate the need for a final rule in the of the transmission provider. Further, MWh, it would face an imbalance of 20 Imbalance Provisions Proceeding in management of inadvertent energy is MW. However, if it also dispatches its Docket No. RM05–10–000 concerning needed to adhere to NERC standards generation to the same 120 MWh, generator imbalance provisions for and to ensure reliability. Many of the should there be no net charge? intermittent resources. As such, the variables of inadvertent interchange are Similarly, what if a transmission Commission would expect to terminate beyond the control of individual customer schedules 100 MWh but has a that docket concurrent with the transmission providers. Because of the load of 80 MWh and dispatches its adoption of revised energy and nature of inadvertent energy and generation to 80 MWh? Does the generator imbalance schedules in this historical practices, transmission potential to allow netting for offsetting proceeding. providers pay back imbalances in kind, imbalances contradict the principle of 244. With respect to the pricing of and the Commission has accepted this encouraging good scheduling practices? energy and generator imbalances, the treatment as just and reasonable. In We also seek comment on what would Commission believes that charges based contrast, allowing customers to pay back be a reasonable percentage to net on incremental costs or multiples of all energy and generator imbalances in without concerns that allowing such incremental costs will provide the kind would not provide sufficient netting would lead to reliability proper incentive to keep schedules incentives for them to minimize concerns from using unscheduled accurate without being excessive. In imbalances. Some commenters have transmission or would cause redispatch deriving such charges, the Commission argued that the return-in-kind approach costs by the transmission provider. proposes that incremental cost be to inadvertent energy between control 2. Credits for Network Customers defined to include both energy and areas is discriminatory because OATT commitment 234 costs (to the extent customers are required to bear actual 248. Section 30.9 of the pro forma charges for their imbalances. As we OATT states that a network customer 233 See 2006 Transmission and Ancillary Service have described, we believe the two owning existing transmission facilities Rate Schedules, approved in United States Dep’t of services are different and hence do not that are integrated with the transmission Energy—Bonneville Power Administration, 112 provider’s transmission system may be FERC ¶ 62,258 (2005). The Bonneville tariff believe that the two should have provides that ‘‘For any hour(s) that an imbalance is precisely the same treatment. However, eligible to receive cost credits against its determined by [Bonneville] to be an Intentional we seek comment on whether the transmission service charges if the Deviation: (1) No credit is given when energy taken current return-in-kind approach to network customer can demonstrate that is less than the scheduled energy, (2) When energy its transmission facilities are integrated taken exceeds the scheduled energy, the charge is inadvertent energy encourages leaning the greater of: (i) 125% of [Bonneville’s] highest on the grid in times of shortage, and into the plans or operations of the incremental cost that occurs during that day, or (ii) therefore whether any reforms in this transmission provider to serve its power 100 mills per kilowatthour.’’ An ‘‘Intentional area are appropriate. Would pricing and transmission customers. The Deviation’’ is defined as ‘‘a deviation that is section also states that new facilities are persistent during multiple consecutive hours or at inadvertent energy at incremental cost specific times of the day,’’ a ‘‘pattern of under- (or some variant thereof) be an eligible for credits when the facilities delivery or over-use of energy,’’ or ‘‘persistent over- appropriate disincentive? If any reforms are jointly planned and installed in generation or under-use during Light Load Hours, in this area are appropriate, should they coordination with the transmission particularly when the customer does not respond by provider. In the NOI, we asked several adjusting schedules for future days to correct these patterns.’’ Id. at 46. reserve level. See, e.g., Central & South West questions regarding the Commission’s 234 ‘‘Capacity commitment’’ generally is defined Services, Inc., 48 FERC ¶ 61,197 at 61,731 n.9 as the generating capacity committed by a utility to (1989). 236 Imbalance Provisions Proceeding at 32,123 provide capability for another utility to attain its 235 See Order No. 888–A at 30,233. (citing Niagara Mohawk, 86 FERC at 61,028).

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policy on credits for new facilities, which provides that a transmission facilities owned by network customers including whether the Commission customer should receive credits against that are eligible for credits. First, should reconsider its policy of denying its transmission bill when the existing transmission facilities credits for transmission facilities owned transmission provider uses facilities ‘‘integrated with the Transmission by point-to-point customers. owned by that customer to provide Provider’s Transmission Systems,’’ are service to other transmission Comments eligible for credits if the network customers.240 Bonneville and PNM– customer can ‘‘demonstrate that its 249. Many commenters argue that the TNMP state that if applied to existing transmission facilities are integrated existing credit requirement has the facilities, credits for point-to-point into the plans or operations of the effect of discouraging joint transmission customers could cause major cost shifts. Transmission Provider to serve its planning.237 NRECA asserts that making Bonneville argues that these problems power and transmission customers.’’ the existence of joint planning a would be especially severe in the The second category comprises new condition of a customer’s eligibility for Northwest, where there are numerous facilities (i.e., facilities constructed by credits or revenue requirement recovery areas of multiple transmission the network customer after the service simply provides another excuse for ownership, both in series and in commencement date in the OATT), if public utility transmission providers to parallel, and where transmission owners the facilities ‘‘are jointly planned and refuse to engage in joint planning. purchase large amounts of transmission installed in coordination with the 250. EEI contends that if the from each other. Southern states that to Transmission Provider.’’ transmission provider is required to effectuate this proposal, the 254. We agree with the commenters provide credit against the customer’s Commission would need to revise its who argue that section 30.9 should be cost of transmission service, the cost of ‘‘higher of’’ pricing requirements, reformed. We agree that the link the customer’s jointly planned and otherwise no point-to-point customer integrated transmission facilities should between credits for new facilities and would build transmission facilities the requirement for joint planning can be automatically added to the when it can require the transmission transmission provider’s cost of service. act as a disincentive to coordinated provider to do so and costs are rolled planning, which is contrary to the EEI states that the Commission has into rate base. Entergy opposes adopted a similar approach with respect Commission’s original objective in providing credits for transmission adopting the provision. A transmission to third party supply of reactive facilities owned by point-to-point capability. EEI also argues that provider has an incentive to deny service customers because those coordinated planning if it believes that automatic credit for customer facilities facilities are not used to integrate is inappropriate because in instituting the cost of any facilities constructed as resources and loads in the same way a result of that process will have to be open access and requiring transmission that facilities owned by network providers to offer network service, the borne in significant part by its bundled customers are. retail customer. Commission made it clear that it did not 252. Other commenters argue that the direct a merging of the parties’ Commission should modify the pro 255. Therefore, we propose to sever transmission systems or the operation of forma OATT to include a provision the link between credits and planning, a joint transmission network.238 EEI allowing credits for transmission and treat the two issues separately 242 argues that the Commission should facilities built by a point-to-point within the pro forma OATT. retain the requirement that customer customer.241 TAPS states the Eliminating the link is appropriate transmission facilities are eligible for Commission should re-evaluate its because the crediting of integrated credits from transmission providers bright line denial of credits for facilities serves a purpose independent other than RTOs and ISOs only if they transmission facilities owned by point- of the planning obligation. meet the integration standard. to-point customers. TAPS contends that Traditionally, the Commission has 251. Some commenters argue that the the current section 30.9 integration test allowed a transmission provider to OATT should not be reformed to may be appropriate for long-term (e.g., allocate the costs of integrated facilities include credits for transmission at least 5 years) point-to-point to all users of the integrated system or facilities built by point-to-point customers. South Carolina E&G supports grid consistent with the view that the 239 customers. EEI states that the modifying the pro forma OATT to entire grid is interconnected and question posed in the NOI appears to provide credits for facilities built by provides generalized benefits to all 243 contemplate providing credits to a point-to-point customers, but asserts users. But because integration is a point-to-point customer who constructs that credits should apply only when the fact-specific matter, the Commission in new facilities that are jointly planned customer’s facilities are in service. Order No. 888 decided that credits were with the transmission provider South Carolina E&G states that after the appropriately addressed on a case-by- 244 regardless of whether those facilities passage of a defined period of inactivity, case basis. meet the Commission’s standards for such as when a customer takes a facility 256. Regarding the eligibility for integration of customer-owned out of service, the credits should be credits, as the Commission stressed in transmission facilities. Instead, EEI suspended, to reduce the burden on Order No. 888, while certain facilities argues, the Commission should apply other customers. may warrant some form of cost credit, the test from Consumers Energy Co., the mere fact that transmission Discussion customers may own transmission 237 E.g., Arkansas Cities, East Texas Cooperatives, 253. Section 30.9 of the pro forma facilities is not a guaranteed entitlement Nevada Companies, NRECA, PNM–TNMP, Suez Energy NA, TAPS, TransAlta, TDU Systems, and OATT establishes two categories of Xcel. 242 See Part V.B for a discussion of our proposed 238 For support, EEI cites Florida Municipal 240 EEI cites Consumers Energy Co., 86 FERC planning obligations. Power Agency v. Florida Power & Light Co., 74 ¶ 63,004 at 65,016 (1999), order on initial decision, 243 See, e.g., Pacific Gas and Electric Co., 106 FERC ¶ 61,006 at 61,009–10 (1996), order on reh’g, 98 FERC ¶ 61,333 (2002) and Northeast Texas FERC ¶ 61,144 at P 12, reh’g denied, 108 FERC 96 FERC ¶ 61,130 (2001), aff’d sub nom. Florida Electric Cooperative, Inc., 111 FERC ¶ 61,189 at P ¶ 61,297 (2004); Niagara Mohawk Power Corp., 42 Municipal Power Agency v. FERC, 315 F.3d. 362 6 (2005). FERC ¶ 61,143 at 61,531 (1988); Otter Tail Power (D.C. Cir. 2003). 241 E.g., MidAmerican, South Carolina E&G, Co., 12 FERC ¶ 61,169 at 61,420 (1980). 239 E.g., Bonneville, EEI, and PNM–TNMP. TAPS, and Williams. 244 Order No. 888 at 31,742.

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to such credit.245 Rather, a network we propose that the network customer a discrete transmission service over the customer’s transmission facilities must shall receive credit for transmission contract term. The network customer provide additional benefits to the facilities added subsequent to the takes a usage-based service which transmission grid in terms of capability, effective date of the Final Rule in this integrates its resources and loads and delivery options, and reliability, and be proceeding provided that: (1) Such pays on the basis of its total load on an relied upon for the coordinated facilities are integrated into the ongoing basis. The transmission operation of the grid. The integration operations of the transmission provider includes the network standard, in brief, requires that to be provider’s facilities, and (2) if the customer’s resources and loads in its eligible for credits under pro forma transmission facilities were owned by long-term planning horizon and the two OATT section 30.9, the customer ‘‘must the transmission provider, would be parties coordinate operations of their demonstrate that its facilities not only eligible for inclusion in the transmission facilities through a network operating are integrated with the transmission provider’s annual transmission revenue agreement. In this way, network service provider’s system, but also provide requirement as specified in Attachment is comparable to the service that the additional benefits to the transmission H of the pro forma OATT. transmission provider uses to serve its grid in terms of capability and reliability 257. Thus, the Commission proposes own retail native load, and credits for and can be relied on by the transmission revising section 30.9 to eliminate the certain integrated network facilities are provider for the coordinated operation disincentive to coordinated planning of the grid.’’ 246 This policy is premised and investment in the transmission grid appropriate. The point-to-point on the principle that ‘‘just as the (i.e., by deleting language that permits customer, however, does not purchase transmission provider cannot charge the transmission providers to refuse integration service, nor does it sign a customer for facilities not used to crediting for network-customer-owned network operating agreement with the provide transmission service, the facilities that are not part of its planning transmission provider. Thus, because of customer cannot get credits for facilities process) and provide for non- the inherent differences between point- not used by the transmission provider to discriminatory crediting for integrated to-point and network service, we do not provide service.’’ 247 The Commission facilities comparable to those propose adding a new OATT continues to believe that, for existing transmission provider facilities that are requirement that the transmission facilities, the integration standard is the included in rates. We are proposing this provider make credits generically appropriate standard for determining change to ensure that section 30.9 does available to point-to-point customers whether a network customer’s facilities not impede coordinated planning and to that own transmission facilities. should be eligible for credits. We clarify, otherwise ensure that our crediting Nevertheless, there may be some however, that for new facilities, the policy is just, reasonable and not facilities owned by a point-to-point integration standard must be applied unduly discriminatory. Our action is not customer that meet all the criteria for comparably,248 because application of in any way intended to lessen our credits. Although the Commission is not the integration test in a manner that commitment to coordinated planning including a specific provision in the exclusively benefits the transmission between a transmission provider and its OATT that provides credits for these provider is unduly discriminatory, and customers. To the contrary, we propose facilities, consistent with the a violation of the FPA.249 Specifically, elsewhere in the NOPR to require Commission’s statement in Order No. coordinated planning by all 888, the Commission will address such 245 Order No. 888 at 31,742–43. transmission providers. This situations on a fact-specific, case-by- 246 Southwest Power Pool, Inc., 108 FERC requirement is not linked to the issue of case basis.251 ¶ 61,078 at P 17 (2004) (citing Order No. 888–A at crediting for customer-owned facilities, 30,271), reh’g denied, 114 FERC ¶ 61,028 (2006). but rather is a general requirement 3. Capacity Reassignment 247 Id. at P 20 (citing Order No. 888–A at 30,271 intended to avoid opportunities for & n.277); accord East Texas Coop., Inc. v. Central 260. In Order No. 888, the undue discrimination in transmission & South West Services, Inc., 108 FERC ¶ 61,079 at Commission concluded that a public P 28 (2004), reh’g denied, 114 FERC ¶ 61,027 planning. (2006); Southern California Edison Co., 108 FERC 258. We decline to allow transmission utility’s tariff must explicitly permit the ¶ 61,085 at P 10 (2004); Northern States Power Co., voluntary reassignment of all or part of 87 FERC ¶ 61,121 at 61,488 (1999); Florida providers as part of this proceeding to automatically add costs of credits a holder’s firm point-to-point capacity Municipal Power Agency v. Florida Power & Light 252 Co., 74 FERC ¶ 61,006 at 61,010 (1996), reh’g associated with integrated transmission rights to any eligible customer. As for denied, 96 FERC ¶ 61,130 at 61,544–45 (2001), aff’d facilities to the transmission provider’s the rate for capacity reassignment, the sub nom. Florida Municipal Power Agency v. FERC, cost of service. These costs typically are Commission concluded that it could not 315 F.3d 362 (D.C. Cir. 2003). permit reassignments at market-based 248 In Order No. 888, the Commission addressed considered and evaluated as part of a the comparability requirement: regular cost of service review process. rates because it was unable to determine We caution all transmission providers that while Nevertheless, a transmission provider that the market for reassigned capacity our discussion here addresses the requirements that wishes to add an automatic was sufficiently competitive so that necessary for a customer’s transmission facilities to assignors would not be able to exert become eligible for a credit, the principles of adjustment clause to its rates may seek comparability compel us to apply the same Commission approval for its market power. Instead, the Commission standard to the transmission provider’s facilities for methodology in a filing submitted under capped the rate at the highest of: (1) The rate determination purposes. section 205 of the FPA.250 original transmission rate charged to the Order No. 888 at 31,743 n.452. 259. Finally, the Commission does not purchaser (assignor), (2) the 249 Credits may not be necessary if the propose revising the pro forma OATT to transmission provider’s maximum transmission provider and a transmission customer jointly own the transmission facilities and operate expressly allow transmission credits for stated firm transmission rate in effect at those facilities under the terms of a joint ownership facilities owned by point-to-point the time of the reassignment or (3) the agreement. See Northern States Power Co., 83 FERC customers. Unlike a network customer, assignor’s own opportunity costs ¶ 61,098 at 61,472 (explaining that the crediting a point-to-point customer only pays for provision in pro forma OATT section 30.9 was not intended to apply to jointly owned transmission 251 Order No. 888 at 31,742; Order No. 888–A at facilities), order on clarification, 83 FERC ¶ 61,338, nom. Northern States Power Co. v. FERC, 176 F.3d 30,271. order denying reh’g and clarification, 84 FERC 1090 (8th Cir. 1999). 252 Order No. 888 at 31,696; pro forma OATT ¶ 61,122 (1998), remanded on other grounds sub 250 See, e.g., id. at 61,467. section 23.1.

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capped at the cost of expansion (price 266. Other commenters argue that the FPA requires, the Commission should cap).253 price cap should be revised.258 Exelon require such a filing. 261. The Commission explained in supports the maximum flexibility 268. While Cinergy maintains that the Order No. 888 that opportunity cost possible in use of the transmission current pricing approach for capacity pricing had been permitted at ‘‘the system, including allowing transmission assignments is appropriate, it supports higher of embedded costs or legitimate rights to be assigned and redirected—so consideration of new alternatives that and verifiable opportunity costs, but not long as the transfer capability is would allow more effective capacity the sum of the two (i.e., ‘or’ pricing is available and existing service will not reassignment by the transmission permitted; ‘and’ pricing is not).’’ 254 In be curtailed. Exelon recommends that customer. Cinergy asserts that one area Order No. 888–A, the Commission the Commission modify the OATT to that could be considered is to require explained that opportunity costs for permit transmission customers to charge the transmission provider to provide capacity reassigned by a customer market-based rates for transmission more clarity on how reassignment should be measured in a manner capacity in the secondary market. This requests are analyzed for approval and analogous to that used to measure the change, Exelon argues, would provide the options available to the transmission transmission provider’s opportunity greater incentive for the owner of the customer to post existing service for cost.255 As a result, the Commission transmission right to actively pursue reassignment. 269. Williams and Powerex argue that required that assignors proposing to reassigning the transmission service, revising the price cap will not recover opportunity costs file with the thereby using the transfer capability encourage greater capacity Commission a fully developed formula more efficiently. Alcoa states that reassignment. Williams submits that describing the derivation of opportunity economic incentives are needed to other non-price limitations on capacity costs. The Commission further required enable a secondary transmission reassignment—such as the requirement that all information necessary to capacity market to develop and thrive. that the assignee utilize the same source calculate and verify opportunity costs 267. EPSA and Constellation argue and sink as the original customer—are must be made available to the eligible that the only desirable modification to 256 the real reasons there has not been more customer. this pricing policy would be to capacity reassignment. Stated 262. In the NOI, the Commission eliminate the requirement that differently, Williams contends that the asked whether the price cap remained transmission customers file with the price cap does not restrict capacity reasonable, or whether it should be Commission a method to impose reassignment—source and sink modified or eliminated to further opportunity cost pricing. EPSA states requirements do. encourage capacity reassignment. that to its knowledge, no transmission customer has yet been able to develop Discussion Comments and file a predefined formula 270. In Order No. 888, the 263. Some commenters argue that the mechanism that would serve as an Commission explained that it expected price cap should not be eliminated.257 opportunity cost rate, probably because capacity reassignment to achieve three According to EEI, transmission pricing opportunity cost pricing reflects goals: ‘‘(1) help [customers] manage the policies do not have much impact on dynamic market conditions. financial risks associated with their reassignment of capacity rights, so MidAmerican claims that even when long-term transmission commitments, changes to the approach would be there is no disagreement over the (2) reduce the market power of largely irrelevant. assignor’s determination of opportunity transmission providers by enabling 264. Southern contends that costs, considerable time may be customers to compete, and (3) foster elimination of the price cap might result required to prepare and obtain approval efficient capacity allocation.’’ 259 in inefficiencies by providing an from the Commission of the resulting Because capacity reassignment does not incentive for entities to hoard FPA section 205 filing. EPSA asserts appear to have developed into a transmission capacity. Moreover, that the market itself will cap the value competitive alternative to primary Tacoma and Public Power Council of reassignment at the price the capacity, the Commission is proposing reason that because transmission transmission provider would charge, modifications to its existing pricing remains a monopoly business, cost- i.e., its expansion cost. Constellation policy. We propose removing the price based rates remain appropriate. states that prices of reassigned capacity cap on capacity reassignment and 265. Snohomish expresses concern will be disciplined by the opportunity allowing negotiated rates for that eliminating the price cap may costs of releasing the capacity. Both transmission capacity reassigned by encourage speculation in the purchase Constellation and EPSA state that the transmission customers. We do not of transmission capacity, greatly driving Commission should recognize that propose to lift the price cap for capacity up costs for transmission customers. opportunity costs for released resold by transmission providers or Snohomish, nonetheless, states that transmission capacity are dynamic and their affiliates due to market power auctions of secondary capacity may be provide a market discipline on the price concerns. appropriate, provided the capacity is that any seller will charge and any 271. The Commission notes that purchased under a long-term contract purchaser will pay for reassigned transmission customers have not used for the purpose of serving load and the capacity. In response to EPSA’s the opportunity cost pricing option for sale does not reduce transmission proposal to eliminate the requirement capacity reassignment. Comments capacity for existing customers that that transmission customers file with suggest that this may be due in part to have contracted for the capacity. the Commission a method to impose the complexity of establishing an opportunity cost pricing, APPA argues opportunity cost formula, or the administrative hurdle of filing and 253 that to ensure that the price a seller Order No. 888 at 31,697. supporting a proposal. Simply put, the 254 Id. at 31,740. would charge for firm transmission 255 Order No. 888–A at 30,224. capacity is just and reasonable, as the goals of the capacity assignment 256 See id.; Order No. 888 at 31,740. program remain important to the 257 E.g., Ameren, EEI, Southern, and Tacoma 258 E.g., Alcoa, Constellation, EPSA, Exelon, and Power. MidAmerican. 259 Order No. 888 at 31,696.

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Commission, but the price cap has not exceed the cost of expansion, that price appropriate to require transmission served as a useful means of achieving signal is an important economic providers and their affiliates to conform them. While we recognize that other incentive to induce greater transmission to the price cap for capacity factors may inhibit capacity investment. reassignment. reassignment, eliminating the price cap 274. Concerns have been raised that 276. The Commission seeks comment should provide more flexibility to allowing negotiated rates may provide on the quarterly reports and OASIS market participants and encourage an incentive to ‘‘hoard’’ capacity, or to postings we propose to require from customers to sell their capacity to reserve transfer capability for no transmission providers under this another customer who values the legitimate use other than to speculate on proposal. They will be based on capacity more highly. It also will the price of the reassigned capacity. The information that we will require facilitate the release of capacity and ability of a transmission customer to assignors to give to transmission encourage the maximum number of hoard capacity is not without limits in providers. What information should we voluntary transactions to occur in a that the transmission provider has the require in the quarterly reports and secondary market, which will benefit all obligation to resell as non-firm point-to- OASIS postings, i.e., information about market participants consistent with the point service any firm point-to-point the capacity released, the original rate Commission’s goals for capacity transfer capability reserved by a paid for that capacity, the price charged reassignment. customer but not scheduled within the to the assignee for the capacity, and the 272. Although in Order No. 888 the time-frames established in pro forma term of the assignment? Is other Commission decided not to allow OATT section 13.8. As discussed above, information necessary for operational reassignment at market-based rates we believe that the incentive for the and reliability purposes? Are additional because of concerns that capacity transmission customer to hoard would reports by assignors to the transmission assignors might exert market power, due be limited by the transmission provider necessary, and if so, what to several factors, we now believe that provider’s cost of expansion for long- information should be reported by market forces will limit the ability of term transactions. Thus, we believe that assignors? Should the Commission most assignors to exert market power. the greater efficiency created by a more establish a new quarterly reporting First, we expect that competition among effective capacity trading market for process, e.g., a new form, or utilize the releasing customers will restrict the customers who need capacity during existing electronic electric quarterly potential exercise of market power. peak periods outweighs such concerns report procedures? How frequently Second, the Commission will monitor and that hoarding concerns are should the OASIS postings be made? the market by requiring quarterly overstated. However, we seek comment 4. ‘‘Operational’’ Penalties reports and regular OASIS postings from on whether circumstances exist where transmission providers based on unaffiliated transmission customers a. Unauthorized Use Penalties information submitted to them from could amass market power similar to 277. Section 13.7 of the pro forma reassigning customers regarding their that of the transmission provider. OATT stipulates that a point-to-point reassignment activity (including the 275. We do not propose lifting the service customer’s use of the negotiated rate). The Commission’s price cap for all assignors. A stated goal transmission system may not exceed the complaint procedures and the of capacity reassignment is to ‘‘reduce firm capacity it has reserved at each Enforcement Hotline also are available the market power of transmission point of receipt and each point of for participants raising market power providers by enabling customers to delivery except as specified in section concerns, which should supplement the compete.’’ 260 Commission precedent 22 of the pro forma OATT.262 Section Commission’s existing market oversight has allowed transmission provider 13.7 of the pro forma OATT also directs efforts. Third, the continued regulation affiliates to reassign capacity under the the transmission provider to specify the of rates for primary capacity will act as price cap,261 and we propose to rate treatment and all related terms and a check to ensure just and reasonable continue this policy. To allow conditions for an unauthorized use reassignment rates. For example, transmission providers and their operational penalty in the event that a without congestion on the transmission affiliates to use negotiated rates allows point-to-point customer exceeds its firm system, the transmission provider’s rate the transmission provider to use its reserved capacity at any point of receipt on file serves as the de facto price cap primary market power in the secondary or point of delivery. Section 14.5 of the and, if congestion exists, the market. A transmission provider not pro forma OATT contains similar ‘‘incremental rate,’’ which reflects the subject to a price cap would have the provisions for an unauthorized use transmission provider’s cost of ability and incentive to exercise market penalty in the event that a transmission expansion, should act as a price ceiling power to favor its own generation sales customer exceeds its non-firm point-to- for long-term transactions. when it operates and administers the point service capacity reservation. The 273. The Commission concludes that reassignment process. Furthermore, pro forma OATT does not otherwise because the price cap appears to have lifting the cap for the transmission address unauthorized use penalties. reduced customers’ transmission provider may eliminate the incentive to 278. In Allegheny Power, the options, removal of the price cap is build or expand, as it may allow the Commission capped unauthorized use warranted without a market-by-market transmission provider to take advantage penalties at a level equal to twice the analysis. Our reform is intended to of congested pathways to charge rates standard rate for the service at issue.263 provide alternatives for customers that above the cost of expansion. Because In addition, the Commission clarified value the capacity more highly. The these expected outcomes would reduce that the standard rate to be used as the Commission finds that lifting the price the ability of other customers to cap strikes a reasonable balance compete, and undermine the 262 Section 22 (Changes in Service Specifications) between promoting more efficiency development of a viable secondary of the pro forma OATT prescribes the through trading and relying upon market, we conclude that it remains circumstances under which the transmission competition and price disclosure to customer may modify the point of delivery and the point of receipt for an existing firm point-to-point prevent anticompetitive behavior. 260 Id. service reservation. Though we recognize that the price of 261 Commonwealth Edison Co., 78 FERC ¶ 61,312 263 Allegheny Power System, Inc., 80 FERC reassigned capacity may temporarily at 62,336 (1997). ¶ 61,143 at 61,545–46 (1997) (Allegheny Power).

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basis of the unauthorized use penalty when it does not have a transmission to bring both specific tariff violations charge must be that of the service at service reservation, including the and general issues of non-compliance issue, without regard to the duration of situations described in APS. We further before the Commission. the violation; i.e., if overuse occurs for clarify that an unauthorized use penalty Discussion one hour, but the service overused is would not be assessed in circumstances weekly service, the penalty charge is to when a transmission customer 283. We propose to have transmission be capped at twice the standard weekly inappropriately uses a network service providers pay non-offending, rate.264 In APS, the Commission issued reservation to support an off-system unaffiliated transmission customers an audit report to Arizona Public sale, as discussed in Part V.D.7. when the transmission provider or its Service Company (APS) that contains However, a transmission customer that affiliate incurs operational penalties. two findings that Commission audit inappropriately uses network service This proposal is consistent with our staff characterized as unauthorized use would be required to pay for the point- prior findings that operational penalties of transmission service.265 In the first to-point service it should have reserved collected by the transmission provider finding, APS’s wholesale merchant and could be subject to a civil penalty should be credited back to non- function did not request and pay for depending on the circumstances. We offending transmission customers in point-to-point service to support some seek comment on whether the current order to provide an incentive to the of the off-system power sales it made at policy that limits unauthorized use transmission provider to develop non- trading hubs where APS system penalties to twice the standard rate for penalty remedies that will elicit resources were directly connected. In the service at issue has resulted in appropriate behavior by transmission the second finding, APS incorrectly penalties that are not just and customers.267 For those transmission treated the Phoenix Valley 230kV reasonable; and, if so, we seek comment providers subject to operational system as a single node on its regarding provisions that would yield penalties, we propose to require the transmission system. As a result, off- unauthorized use penalties that are just transmission provider to make an system sales made by generators and reasonable. annual compliance filing to notify the connected to the Phoenix Valley system Commission of the amounts of all such should have been, but were not, b. How Transmission Providers Should operational penalties incurred during supported by point-to-point service. Pay Operational Penalties the year and to propose a method to Other than these cases, the Commission Comments identify non-offending, unaffiliated has not addressed the appropriate 281. In the NOI, the Commission transmission customers to which the method of applying unauthorized use observed that the existing pro forma transmission provider would distribute penalties pursuant to the provisions of OATT allows transmission providers to penalty amounts. In addition, we sections 13.7 and 14.5 of the pro forma propose to allow a transmission OATT. impose certain operational penalties against transmission customers for provider to avoid an annual compliance Comments violations of the pro forma OATT, but filing by making a one-time filing to propose a mechanism through which it 279. MidAmerican states that does not address the adverse consequences to a transmission provider would identify non-offending, unauthorized use penalties should only unaffiliated transmission customers and be imposed if the pro forma OATT who violates its OATT. 282. Several commenters indicate that a method by which it would distribute clearly specifies that they are applicable the operational penalties it or its to a proscribed conduct. a transmission provider would not face the same financial consequence as other affiliates have incurred to the identified Discussion transmission customers when the transmission customers. We also 280. We propose to clarify the transmission provider or an affiliated propose to prohibit transmission circumstances under which we would transmission customer pays an providers from recovering for expect transmission providers to assess operational penalty. TAPS notes that ratemaking purposes or through any unauthorized use penalties. This applying customer-focused penalties to service or facility under the Commi- clarification will eliminate a potential the transmission provider is sion’s jurisdiction any cost it incurs source of discretion in the meaningless if a transmission provider when it or an affiliate pays an implementation of the pro forma OATT merely pays itself. EPSA suggests that operational penalty. and will assist the Commission in its the Commission include provisions in 5. ‘‘Higher of’’ Pricing Policy enforcement of the obligations imposed the new pro forma OATT to ensure that 284. In Order No. 888, the by it. Specifically, we propose to clarify the penalty imposes a true financial Commission stated that system that unauthorized use penalties apply to consequence, e.g., penalties imposed on expansions should be priced at the any circumstance when a transmission a transmission provider should be higher of the embedded cost rate customer uses transmission service that distributed to those OATT customers (including the expansion costs) or the it has not reserved.266 An unauthorized that were taking service during the incremental cost rate, consistent with use penalty would be assessed in period in which the violation occurred. the Transmission Pricing Policy circumstances when a transmission ELCON suggests that the pro forma customer has a transmission service OATT be revised to provide for tariff- 267 See, e.g., Carolina Power & Light Co., 103 reservation, but uses transmission based sanctions against a transmission FERC ¶ 61,209 (2003); Regulation of Short-Term service in excess of its reserved provider that fails to comply with its Natural Gas Transportation Services and capacity. An unauthorized use penalty OATT. Occidental argues that one of the Regulation of Interstate Natural Gas Transportation also would be assessed if a transmission Services, Order No. 637, 65 FR 10156 (Feb. 25, fundamental problems with the current 2000), FERC Stats. & Regs. ¶ 31,091 at 31,315 (2000) customer uses transmission service OATT is the lack of tariff-based (noting that ‘‘to the extent that penalty revenues are penalties for violations. Occidental generated, the required crediting of penalty 264 Id. at 61,546 n.131. states that tariff-based penalties are revenues will eliminate any economic incentive for 265 Arizona Public Service Co., 109 FERC ¶ 61,271 pipelines to rely on penalties rather than at P 6 (2004) (APS). needed to focus transmission providers inducements’’); order on reh’g, Order No. 637–A, 65 266 The revised pro forma OATT reflects this on compliance and to permit customers FR 35705 (Jun. 5, 2000), FERC Stats. & Regs. proposed reform in sections 13.7 and 30.4. and the Commission’s enforcement staff ¶ 31,099 (2000).

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Statement.268 The Commission has the cost of the upgrades over the life of market. AWEA and EPSA argue that a explained that when rolling in the costs the contract.272 Presenting the long-term request for service from a new of network upgrades incurred to meet a incremental charge in the form of a generator can be denied because there transmission service request would have monthly rate allows a customer seeking are reliability violations in only a few the effect of raising the average a lower rate to choose to request a hours of a year, even though firm embedded cost rate paid by existing longer transaction term. service is nonetheless available for the customers, the transmission provider 286. We encourage comments on large majority of hours of the year. They may elect to charge an incremental cost whether changes to the pro forma OATT also argue the existing grid is rate for the new service and thereby are necessary to ensure that incremental underutilized and that these practices insulate existing customers from the costs are presented as monthly rates for only exacerbate this problem. EPSA costs of any necessary system upgrades. service. further states that some transmission However, the transmission provider D. Non-Rate Terms and Conditions provider base case models show that the may not charge both an incremental cost transmission provider is operating its rate and an embedded cost rate 287. In this section, we propose a system to serve its bundled retail native associated with existing network number of reforms to non-rate terms and load under contingencies that the transmission facilities.269 conditions of service under the pro transmission provider would not 285. Although we are not undertaking forma OATT. We propose these reforms accommodate for an OATT customer. generic transmission pricing reform in to eliminate opportunities for undue 290. PPL argues that the Commission this proceeding, we are concerned that discrimination, to ensure that the should enforce the requirement in our existing policies may not be being services offered under the pro forma section 13.5 of the pro forma OATT that applied consistently and, as a result, OATT are just and reasonable, to transmission providers must redispatch customers may be quoted prices that are increase the transparency of service to relieve congestion that may only not consistent with the ‘‘higher of’’ being provided, and to provide clarity occur during a few hours a year. PPL policy. We understand that customers with respect to terms and conditions further contends that transmission typically are quoted an incremental rate that have caused confusion in the providers have the incentive to simply in the form of a total dollar amount of industry. deny requests for transmission over a needed facility upgrades (e.g., 1. Potential Modifications to Long-Term path that experiences occasional $5,000,000) rather than in the form of a Firm Point-to-Point Service congestion, rather than properly monthly transmission rate that can be undertake redispatch actions to compared, on an ‘‘apples-to-apples’’ 288. In Order No. 888, the Commission required all public utilities minimize this congestion. Others state basis, to the embedded cost rate. that they have not received an offer by Presenting an incremental rate as a to offer both firm and non-firm point-to- point service and firm network service a transmission provider to redispatch to lump sum payment request is accommodate a request for transmission inconsistent with our ratemaking policy on a non-discriminatory open access 273 service, but instead are given no choice and has the potential to discourage basis. In the NOI, the Commission asked for comments on pricing policies but to pay for facilities studies that are customers from proceeding with service costly and time consuming.277 Entergy requests.270 As we have noted, under that can create an incentive to maximize the use of the transmission system.274 states in its reply comments that it only our ‘‘higher of’’ pricing policy for evaluates redispatch as part of a system network upgrades, the transmission Also, the Commission asked whether the OATT should require transmission impact study if requested by the provider should compare the monthly transmission customer. revenue requirement from the upgrade providers to offer new transmission services, such as conditional firm, 291. Several commenters suggest that to the monthly revenue requirement pricing complexities and certainty of from the embedded transmission rate.271 partial firm, and seasonal firm service.275 Further, the Commission recovery must be resolved before We also have said that the incremental requiring mandatory redispatch. These rate should be established by amortizing asked in the NOI whether deviations from the ‘‘higher of’’ pricing policy commenters state that the cost of redispatch is more than the fuel cost 268 would encourage greater incremental Inquiry Concerning the Commission’s Pricing differential and includes hard to Policy for Transmission Services Provided by Public pricing of redispatch service.276 Utilities Under the Federal Power Act, Policy quantify costs such as start-up costs, Statement, 59 FR 55031 at 55037 (Nov. 3, 1994), Comments higher capital costs due to shorter life FERC Statutes and Regulations ¶ 31,005 at 31,146 and accelerated replacement, higher (1994), order on reconsideration, 71 FERC ¶ 61,195 289. Some commenters support the (1995) (Transmission Pricing Policy Statement). inclusion of a required new service and maintenance costs, and potential 269 See Northeast Utilities Service Company (Re: contend that the existing rules for long- emergency power purchases to serve Public Service Company of New Hampshire), term firm point-to-point service pose load in constrained areas.278 Opinion No. 364–A, 58 FERC ¶ 61,070 (1992), reh’g barriers to new entry. Constellation 292. PacifiCorp suggests that the denied, Opinion No. 364–B, 59 FERC ¶ 61,042, higher charge, whether embedded costs order granting motion to vacate and dismissing states that new products are needed that request for rehearing, 59 FERC ¶ 61,089, aff’d in facilitate the efficient use of the or redispatch costs, be determined on a part and remanded in part sub nom. Northeast transmission system in a competitive monthly basis rather than making a one- Utilities Service Company v. FERC, 993 F.2d 937 time determination prior to (1st Cir. 1993), order on remand, 66 FERC ¶ 61,332, 272 commencement of service. PacifiCorp reh’g denied, 68 FERC ¶ 61,041 (1994) pet. denied; Southwest Power Pool, Inc., 98 FERC ¶ 61,256 Pennsylvania Electric Co., 58 FERC ¶ 61,278, reh’g (‘‘We agree with SPP that the amortization period argues that the typical cost analysis fails denied, 60 FERC ¶ 61,034 (clarifying pricing for upgrade costs should match the contract period. to consider the complexity of policy), reh’g denied, 60 FERC ¶ 61,244 (1992), aff’d * * * As the customer is only obligated to take determining redispatch. PacifiCorp service for the term of the contract, it is reasonable sub nom. Pennsylvania Electric Co. v. FERC, 11 contends that cost estimates become F.3d 207 (D.C. Cir. 1993). that the costs only be amortized over the term of 270 Southwest Power Pool, Inc., 100 FERC the contract.’’); reh’g denied in pertinent part, 100 increasingly unreliable as the analysis ¶ 61,096 (2002) (designing a rate to include a FERC ¶ 61,096 (2002). balloon payment is not a substitute for a properly 273 Order No. 888 at 31,690. 277 E.g., AWEA, Arkansas Cities, EPSA, and designed rate). 274 NOI at P 13. Renewable Energy. 271 Southwest Power Pool, Inc., 112 FERC 275 Id. at P 13. 278 E.g., Ameren, EEI, Progress Energy, and ¶ 61,319 at P 33 (2005). 276 Id. at P 12. Southern.

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extends over time, and the the current curtailment priorities in the 297. MidAmerican states that various complications of one-year transmission OATT and the design and purchase of transmission providers interpret and service agreements with rollover options systems to track the purchases and apply the provisions of section 19.7 make an accurate calculation nearly implement the more complex (Partial Interim Service) of the pro impossible. curtailment schemes. TAPS notes that forma OATT in different ways. 293. AWEA provides a detailed PacifiCorp amended its OATT to make MidAmerican states that the proposal for conditional firm service, in more explicit the potential for granting Commission should clarify whether which the transmission provider would part of a request for firm service in section 19.7 refers to a partial period of identify certain months, weeks, or days terms of both the amounts of service service (i.e., granting firm service for the when firm transmission service may be and/or the periods of time for which full MW amount of the initial request, limited or unavailable and identify the there is sufficient ATC.282 If the but for only a portion of the requested number of potential hours during those Commission develops new services, time period), or a partial quantity of conditional times, when the customer TAPS contends that the Commission service (i.e., granting firm service for the could have its reservations cut or should build on PacifiCorp’s OATT time period of the initial request, but for reduced prior to any firm customer amendments. Many commenters that only a portion of the requested full MW reductions. Under specified conditions, object to requiring new transmission amount). MidAmerican suggests that the for a limited number of hours over a set services recommend that the revised OATT should provide that number of ‘‘conditional’’ months, Commission encourage transmission partial interim service be offered both weeks, days or hours, the firm service providers to develop and adopt new for partial periods and for partial may be reduced day-ahead by the services in response to customer quantities. transmission provider, with conditional needs.283 Ameren explains that this 298. Bonneville states that, currently, firm service provided instead in those process should result in additional when a customer accepts an offer of hours firm service is unavailable. The services being provided that meet the partial service, Bonneville keeps the ‘‘conditional’’ periods would be needs of the customers, that are remaining portion of the customer’s established when the service is offered. physically feasible considering the request in the queue if the customer Also, capacity commitments for existing uses of the system, and that do executes a system impact study conditional firm service would be not adversely affect the service provided agreement. Bonneville contends that the accounted for in ATC calculations prior to other users of the system and are not Commission’s OASIS Standards and to new sales of short-term firm unduly discriminatory. Finally, several Communication Protocols, however, transmission service. Commenters commenters express a general sentiment appear to disallow this result, as does support a requirement that transmission against requiring a service that may not standard OASIS functionality. providers post on OASIS the paths for be suited to all regions or systems.284 Bonneville asks that the Commission which conditional firm service is 296. Commenters also expressed clarify whether the Commission intends available, clearly listing the available support for services aside from, or in that a customer accepting an offer of capacity for each period, and hours addition to, conditional firm service. partial service should lose its position during which firm service is available or Exelon proposes that the Commission in the queue. curtailment is possible as a result of should require ‘‘seasonal firm’’ service, 299. EPSA further argues that congestion.279 though other commenters ask if seasonal transmission providers should be 294. Those supporting conditional firm service would invite hoarding or required to accommodate a request for firm service argue that it should be ‘‘cream skimming.’’ MidAmerican any service, whether or not articulated offered to customers requesting long- contends that in most cases, the need for in the new OATT, to the extent they can term firm service when firm ATC is not seasonal service can be accommodated do so, on a nondiscriminatory basis and available during all hours of the request, by multiple consecutive purchases of without unreasonably affecting and allow the transmission customer to monthly service. PPL supports a reliability. EPSA also states that the obtain service when it would otherwise required ‘‘partial firm’’ service that is burden should be on the transmission confirmed and available on a firm basis be denied.280 As for the rate design of provider to state in writing why it but provided in various amounts over the service, EPSA and PPL recommend cannot accommodate any given request. that it include either a discount from the an annual period. PPL states that the Discussion firm rate to reflect the reduction in use amount of partial firm service offered would be shaped to match the available at the system peak or no discount from Proposed Findings capacity within each interval or the the firm rate, but customers taking year. Powerex and WAPA argue long- 300. The Commission preliminarily conditional firm service would have a term priority non-firm point-to-point finds that the existing methods for right of first refusal when firm service service is the most workable new evaluating requests for long-term firm becomes available for the hours in service. point-to-point service may no longer be which they have agreed to be curtailed. just, reasonable and not unduly 295. Commenters arguing against a 282 See PacifiCorp Open Access Transmission discriminatory. We believe that requirement to provide conditional firm Tariff, section 19.7, FERC Electric Tariff, Fifth transmission providers may evaluate service argue that it would degrade the Revised Volume No. 11, Substitute Original Sheet transmission availability to serve long- quality of service received by existing No. 100 (effective April 26, 2004); see also PacifiCorp Open Access Transmission Tariff, term transmission service requests in a long-term firm point-to-point and Schedule 7, Long-Term Firm Point-To-Point manner that is not comparable with the 281 network customers. Also, Bonneville Transmission Service, section 2, FERC Electric method they use to evaluate argues that providing conditional firm Tariff, Fifth Revised Volume No. 11, First Revised transmission needs for bundled retail service would require modification to Sheet No. 252 (effective April 1, 2006) (rates for partial delivery of long-term firm point-to-point native load and, therefore, that certain transmission service). reforms are necessary to ensure 279 E.g., EPSA and PPL. 283 E.g., Ameren, Bonneville, Cinergy, EEI, comparability. 280 E.g., AWEA, Constellation, EPSA, KCP&L, Nevada Companies, NRECA, Salt River, MidAmerican, PPL, and Renewable Energy. Sempra Global, Southern, TVA, and WAPA. 301. When a transmission provider 281 E.g., APPA Reply Comments, Powerex, and 284 E.g., Ameren, Cinergy, Salt River, and considers new resources to serve its Salt River. Southern. bundled retail native load, the

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transmission provider will not eliminate from the evaluation typically ensure comparable treatment of new an otherwise economic option because undertaken by the transmission generation resources for all transmission the resource may not be deliverable in provider in deciding whether customers, eliminate barriers to entry a few hours of the year. Rather, the transmission is available to serve for new generation sources seeking long- transmission provider will evaluate bundled retail native load with a new term transmission arrangements, and whether it can redispatch its resources resource. encourage the efficient and flexible use as necessary to ensure that load is 303. In Order No. 888, the of the transmission system in a served on a reliable and economic basis. Commission’s goal was to ‘‘facilitate the competitive market. If redispatch is needed in only a few development of competitively priced Proposed Solutions hours of the year, the transmission generation supply options, and to provider typically will not construct ensure that wholesale purchasers of 305. The Commission believes there new facilities to accommodate new electric energy can reach alternative are two basic options for addressing this resources. Rather, the transmission power suppliers and vice versa.’’ 286 The problem.288 The first option focuses on provider will look for a resource at a first part of this goal, development of generation redispatch to accommodate different location to fulfill its needs on competitive supplies, has been realized long-term firm point-to-point service, a least cost basis taking into account to some degree.287 However, the lack of while the second option creates a transmission and energy costs. This use transmission access threatens the modified form of firm point-to-point of redispatch to accommodate a new viability of customer alternatives to service that includes non-firm service in resource means that the resulting their traditional suppliers. Without a defined number of hours of the year service is provided even though the long-term firm service, it is difficult for when firm point-to-point service is not transmission provider’s power flow alternative suppliers to procure the available. The Commission’s studies show that ATC is not available financing they need for project preliminary view is that the redispatch in all hours of the year. In this situation, development. Customers taking non- option is superior because it: (1) Mirrors the new resource receives a firm service firm point-to-point service have a lower the way that transmission providers that is not currently available on many reservation priority and are subject to plan for bundled retail native load, (2) systems to OATT customers because the curtailment and interruption more would provide firm service to new transmission provider uses redispatch frequently than network customers entrants, rather than service that is on a long-term basis to accommodate a taking transmission service from subject to more frequent curtailment in new resource for which ATC is not resources other than designated network certain hours of the year, and (3) may available in every hour; in some resources. Thus, the lack of long-term avoid certain implementation issues respects, this firm service is similar to firm transmission access being provided associated with designing a modified conditional firm service because it uses on a nondiscriminatory basis is a long-term point-to-point service. firm transmission capacity to serve significant problem in realizing the However, we seek comment on this bundled retail native load even though goals of Order No. 888. preliminary view and on both of the the resource is not deliverable in every 304. The Commission’s preliminary options outlined below.289 view is that current practices do not hour of the year. Redispatch Service 302. The Commission believes that adequately reflect the manner in which the current practices for evaluating long- transmission service is planned for 306. The Commission believes that term transmission service requests bundled retail native load and may no full utilization of generation redispatch generally may not reflect the same longer be just, reasonable and not is the preferred method of ensuring that practices used to evaluate transmission unduly discriminatory. Transmission long-term point-to-point service is not needs to serve bundled retail native customers, especially those customers unduly discriminatory and does not load. Under current practices, the seeking service to or from new serve as a deterrent to new entry. The transmission provider evaluates generation resources, must be given preferred approach is described below. whether service can be granted in every greater flexibility of service to meet their 307. Section 13.5 of the pro forma hour of the year that is modeled and, if needs comparable with the flexibility OATT requires the transmission not, it informs the customer that long- provided on behalf of bundled retail native load. New generation resources 288 We will continue to encourage transmission term firm transmission service cannot providers to propose other services requested by be provided out of existing transmission often face a grid that cannot customers or such services that may meet their capacity. Section 19.3 of the pro forma accommodate requests for long-term customers’ and systems’ needs as energy markets OATT provides that a system impact firm transmission, at least not without evolve. However, the Commission does not propose to require transmission providers to provide any study is required before the the significant delay required by service other than the services expressly set forth transmission provider must identify transmission construction, despite the in the pro forma OATT. In response to EPSA, the available redispatch options. Before fact that redispatch options may exist decision to provide a new OATT service in the first redispatch options are offered, however, that would allow that resource to be instance remains with the transmission provider. Moreover, several of the proposals included in this the customer must also agree to fund a accommodated. In sum, maintaining the NOPR such as lifting the price cap associated with facilities study to determine whether status quo, as advocated by several capacity reassignment for firm point-to-point redispatch is less expensive than the commenters, may be insufficient to service and hourly firm point-to-point service 285 should provide transmission customers with greater transmission facilities upgrades. service flexibility. 286 Thus, it is only if the customer requests Order No. 888 at 31,646. 289 We also request comment on the applicability a system impact study and facilities 287 In 2004, electric generation from IPPs of these two options for transmission providers who study, and agrees to pay for the studies, represented an increasing share of the wholesale operate RTOs or ISOs. Because RTOs provide markets with nearly 36 percent of total sales, a that the request will be evaluated redispatch service and the ability to access significant increase from 1996 when they accounted transmission with no prior reservation by paying further and the option of redispatch will for only 12 percent of total sales. In 2004, IPPs congestion charges, they may not need to reform be offered to the customer. This study accounted for 36 percent of generator nameplate their existing procedures to satisfy our proposal process is both time consuming and capacity compared to 56.5 percent for utilities and with respect to redispatch. We also note that 7.5 percent for combined heat and power. Office of conditional firm service has the potential to disturb expensive. More importantly, it differs Coal Nuclear Electric and Alternative Fuels, Energy the link between long-term service and the Information Administration, Electric Power Annual allocation of Financial Transmission Rights (FTRs) 285 See pro forma OATT section 27. 2004 at 9 (2005). or auctions of FTR rights.

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provider to expand or upgrade its costs or perform the facilities study, or ensure greater use of this option, both to transmission system or, if it is more both. facilitate long-term requests for service economical, to redispatch its resources 309. Consistent with the existing and to grant customers greater flexibility to provide requested firm point-to-point requirements of the OATT, the in choosing resources on a daily or service without: (1) Degrading or redispatch requirement would apply to hourly basis. A redispatch pricing impairing the reliability of service to the redispatch of the transmission proposal could include a MW quantity, native load customers, network provider’s own generation resources and the incremental cost of fuel (increasing customers and other transmission would not require the transmission the supply of fuel) at the point of customers taking firm point-to-point provider to purchase new resources to delivery, and the decremental cost of service; or (2) interfering with the provide this service.291 However, we fuel (decreasing the supply of fuel) at transmission provider’s ability to meet propose to require the transmission the point of receipt capped at the price prior firm contractual commitments to provider, when it cannot accommodate of fuel. These costs could be calculated others. The cost of any redispatch a long-term firm point-to-point based on the difference between the cost performed pursuant to section 13.5 is to transmission request through redispatch of ramping up a generator at the point be specified in the service agreement of its own resources, to identify the of delivery and ramping down a prior to initiating service and charged to generators in other control areas that generator at the point of receipt.293 We the transmission customer consistent could relieve the constraint on the invite comments on whether including with Commission policy. For network affected flowgates to allow the such a formula in the transmission service, section 33.2 of the pro forma transmission customer to seek provider’s OATT would facilitate OATT also requires all network redispatch with transmission providers redispatch and whether it should customers to agree to redispatch their in adjacent control areas to remove such account for other, hard-to-quantify costs network resources, along with constraints. We also seek comment on such as those listed by EEI: Start-up transmission provider’s own resources, whether to expand the existing OATT costs, higher capital costs due to shorter to relieve a constraint that may impair obligation to require the transmission life and accelerated replacement, higher reliability. Section 33.3 of the pro forma provider to redispatch not just its own maintenance costs, and potential OATT provides that the costs of resources, but those of its network emergency power purchases to serve reliability redispatch performed customers also, subject to the network load in constrained areas. One option pursuant to section 33.2 are to be shared customers receiving appropriate might be to establish a standard per between network customers and the compensation when their resources are kWh fee for such costs, as was initially transmission provider on a load-ratio redispatched. done for ancillary service costs. share basis.290 310. Another issue that arises is how 312. There are few examples of the redispatch option should be priced. functioning redispatch programs on 308. To encourage the provision of The pro forma OATT caps the cost of which to base any kind of generic redispatch as an option to facilitate use redispatch at the cost of constructing the change to the pro forma OATT. of the existing transmission grid, we network upgrades needed to facilitate However, the Commission has approved propose to revise the pro forma OATT the requested transmission service. OATT provisions for SPP 294 (prior to its to require the offer of redispatch prior Some commenters discuss what costs becoming an RTO) and Deseret.295 to the performance of a facilities study. should be included in a redispatch rate, 313. The redispatch provisions in We note that the system impact study, such as start-up costs, higher SPP’s OATT permitted a transmission as defined by the pro forma OATT, is maintenance costs and fuel differentials, customer facing a constrained path to the transmission provider’s assessment and state that inclusion of these charges decide whether to: (1) Go forward with of the adequacy of its grid to would send clearer price signals and its requested transmission service, (2) accommodate a request for firm point- induce transmission investments.292 obtain relinquished capacity (solicit to-point or network service and whether 311. Establishing a formula rate for from holder of firm transmission rights any additional costs may be incurred to redispatch costs may be one way to the price at which they would provide the requested service. It is relinquish their rights subject to the followed by a facilities study, which is 291 However, we also request comment on caps), (3) reduce transmission service to defined as an engineering study to whether it would be appropriate to require the match the level of ATC without determine the transmission system transmission provider to contract to purchase redispatch, (4) pay for redispatch, or (5) modifications necessary to provide the generation from outside of its control area if it would facilitate a firm transaction. We note that at forego the transmission transaction. requested service, including cost and least one redispatch provisions currently in use 314. Under Attachment H of SPP’s scheduled completion date. Neither contemplates the use of third-party generation for OATT (Redispatch Procedures and study references the steps necessary to redispatch. See Deseret Generation and Redispatch Costs for Short-Term-Firm evaluate the cost of redispatch that Transmission Cooperative, Inc. (Deseret) FERC Electric Tariff, First Revised Volume No. 2 (Deseret Point-to-Point Transmission Service could be performed in lieu of expanding OATT), accepted for filing in Deseret Generation Subject to Redispatch Cost) the charges the grid. Therefore, we propose that the and Transmission Cooperative, Inc., Docket No. to be paid by the transmission customer transmission provider must, as part of ER01–2642–000 (Aug. 27, 2001) (unpublished letter for redispatch service could not exceed the system impact study process, order). Attachment J of Deseret’s OATT states, in part: ‘‘If redispatch services are provided under this the charges the transmission customer include an estimate of the number of Attachment J, the [t]ransmission [p]rovider will in would have paid under SPP’s point-to- hours of redispatch that may be required good faith attempt to relieve the constraint by the point tariffs. Stated differently, SPP to accommodate the request for least-cost means, whether by seeking a change in capped the redispatch charges at a level transmission service, and a preliminary generation output from the [t]ransmission [p]rovider’s [m]erchant [f]unction or from any other estimate of the cost of that redispatch. feasible generator or by other means including 293 For example, redispatch costs = 75 MW × ($60 The customer would then be given the facilitating the payment of firm transmission incremental cost at the point of delivery ¥ $15 option of having the transmission customers to temporarily give up their rights to decremental cost at the point of receipt) = $3,375. provider perform the necessary studies relieve the constraint.’’ Deseret OATT, Attachment 294 See Southwest Power Pool, Inc., 82 FERC J, Part I.D, Original Sheet No. 340 (effective July 1, ¶ 61,267, modified, 82 FERC ¶ 61,285, order on to determine the projected redispatch 2001). reh’g, 85 FERC ¶ 61,031 (1998); Southwest Power 292 E.g., Ameren, EEI, Progress Energy, and Pool, Inc., 84 FERC ¶ 61,055 (1998). 290 Order No. 888–A at 30,267. Southern. 295 See supra note 291.

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that ensures that total charges did not 318. Finally, we recognize that a Morgan Stanley, the Commission found exceed the total charges the customer transmission provider may need to that had the customer requested long- would have paid under individual coordinate with marketing affiliate or term service for a two-year period, but company tariffs. For generation energy affiliate employees to arrange only one year was available, the resources, the redispatch included the generation redispatch.296 However, such transmission provider would have been higher of incremental or replacement communication and coordination raise obligated to offer service for that one fuel costs and incremental operation potential problems for the transmission available year.300 The Commission was and maintenance costs of generation provider regarding compliance with the clear, however, that partial interim facilities necessary to relieve constraints Commission’s Standards of Conduct, service does not require the on the transmission system. which require separating transmission transmission provider to treat a request 315. The redispatch provisions in function employees from wholesale for annual service as if it necessarily Deseret’s OATT are designed to track marketing and energy affiliate included a request for all subsumed cost causation with redispatch costs and employees.297 We seek comment on monthly or weekly durations of service contains features similar to the SPP what communication and coordination during the requested year.301 In other OATT provisions such as providing protocols can be established to permit words, a transmission provider does not customers with the opportunity to the provision of generation redispatch need to respond to a request for one year obtain relinquished capacity. Like SPP, in a manner that is not unduly of service with an offer of monthly the redispatch costs in Deseret’s OATT discriminatory or preferential, and service. The Commission has also are capped at the cost incurred by the consistent with the Standards of interpreted section 19.7 to apply to transmission provider to provide the Conduct. requests for transmission service that requested service. Under Attachment J have not undergone or do not of Deseret’s OATT (Redispatch Conditional Firm Service necessarily require a system impact Protocol), generally the redispatch costs 319. The Commission seeks comment study or facilities study.302 Further, the are calculated by multiplying the on whether a modified form of long- Commission has required transmission redispatch quantity, in MWh, that is term point-to-point service would be providers to offer partial interim service required to satisfy the transmission preferable to the redispatch service even where third-parties must provide customer’s schedule in that hour by the described above. This conditional firm upgrades in order to provide for the full redispatch price. Attachment J of service option would address the transmission service request.303 Deseret’s OATT also includes problem of reliability limitations during Although partial interim service has a provisions for crediting and netting of certain peak hours by allowing the duration component, it differs from redispatch costs. transmission provider to provide non- conditional firm service, which would 316. We also are concerned that there firm service to the customer in those require the transmission provider to is a great deal of complexity and fuel hours. We note that at least one treat the request for service as if it price risk in projecting years into the transmission provider currently included a request for monthly, weekly, future the hours of redispatch that will provides this service pursuant to daily, and hourly firm service during be required to grant the transmission amendments to the partial interim the year. request and the cost of that redispatch service provision of its OATT,298 with 321. If we decline to adopt the in those hours. Moreover, because of the only modest differences from the service redispatch proposal above, any need for involvement of the described below. conditional firm service that we would transmission provider’s generation arm 320. As an initial matter, in response order would be made available only to to project costs associated with to requests for clarification of the partial customers who request long-term firm redispatch and the need to factor in interim service in section 19.7 of the pro point-to-point service. When the long- unpredictable fuel costs, we are forma OATT, we will summarize the concerned about the degree of discretion Commission’s precedent on this service. (directing transmission provider to provide 18 involved in determining redispatch The Commission has clarified that months of partial interim service for a customer costs. Understandably, the transmission requesting eight years of service). partial interim service has a partial 300 Morgan Stanley at 61,220. In response to provider does not want to bear the price duration element, as well as a partial Bonneville, the Commission clarifies that a risk associated with projected fuel costs, quantity element.299 For example, in customer does not lose its queue position for its nor does the customer. PacifiCorp, in its original request when it accepts a counteroffer for less service than originally requested. comments, describes a possible proposal 296 In this discussion, we use the terms 301 Id. at 61,220; Tenaska Power Services Co. v. ‘‘transmission function,’’ ‘‘marketing affiliate’’ and that would calculate redispatch costs Southwest Power Pool, Inc., 93 FERC ¶ 61,082 at ‘‘energy affiliate’’ as those terms are used in the monthly and charge the higher of 61,222–23 (2000) (both concluding that redispatch or the OATT rate each Standards of Conduct regulations. See 18 CFR 358.3 transmission provider has no obligation to respond (2005). to a long-term request with an offer of short-term month. We request comment on 297 See Order No. 2004 at P 85–94. service). whether PacifiCorp’s proposal may be a 298 See PacifiCorp, 98 FERC ¶ 61,224 at 61,885 302 See, e.g., Idaho Power v. Bonneville at 61,080– way of addressing the complexity and (accepting revisions to section 19.7), order on reh’g, 81 (requiring an offer of partial interim service for risk associated with determining 99 FERC ¶ 61,259 (2002). short-term firm service where a system impact redispatch costs over a long period and 299 See, e.g., Idaho Power Co. v. Bonneville Power study is not applicable); Morgan Stanley Capital Administration, 96 FERC ¶ 61,031 at 61,080–81 Group v. Illinois Power Co., 83 FERC ¶ 61,204 at allow greater access to otherwise (2001) (Idaho Power v. Bonneville) (interpreting 61,912 (ordering partial interim service without unused transmission capacity on a firm section 19.7 to require Bonneville to offer 277 MW requiring a system impact study or facility study), basis. of monthly short-term firm transmission capacity clarification granted, 83 FERC ¶ 61,299 (1998), reh’g 317. We ask for comment on whether interim service to the entity next in the queue with granted in part, 93 FERC ¶ 61,081 (2000). all or a portion of SPP’s, Deseret’s, or a request of 577 MW); Morgan Stanley Capital 303 Bonneville Power Administration, 110 FERC Group v. Illinois Power Co., 93 FERC ¶ 61,081 at ¶ 61,001 at P 36–37 (directing Bonneville to offer to PacifiCorp’s proposals should form the 61,220 (2000) (Morgan Stanley) (‘‘Illinois Power provide customer with whatever portion of the basis for a generic redispatch provision should have offered as much transmission capacity request it could provide on a firm basis after the that could be included in the pro forma as it could provide continuously for the duration of customer’s generation project was energized OATT, as a means of ensuring that the request, i.e., as many MW of transmission without upgrades to PacifiCorp’s system and to service as available for the entire one-year period amend the agreement after upgrades are completed redispatch service is available and Morgan Stanley requested.’’); accord Idaho Power to provide for the full amount), reh’g denied, 110 priced on a just and reasonable basis. Co., 90 FERC ¶ 61,009 at 61,018–19 (2000) FERC ¶ 61,094 (2005).

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term firm point-to-point service is not burdensome and costly. Further, as customer’s request to designate a new available, and the customer requests discussed below, we believe that network resource was denied due to conditional firm service, the conditional firm point-to-point service, lack of ATC, the network customer transmission provider would evaluate as proposed, is analogous to the could seek secondary network service transmission availability for the portion secondary network service currently for the resource and receive service on of the long-term request that cannot be used by network customers and an as-available basis. Such service filled due to lack of ATC. The therefore both services should enjoy the would be curtailed only after all non- evaluation of conditional firm same curtailment priority. firm point-to-point uses sharing the availability should occur prior to a 323. We propose that customers pay same flowgate were curtailed. This is system impact study or facilities study. the long-term firm point-to-point rate for similar to the service that we now In offering conditional firm service, the conditional firm service and have a right propose for point-to-point customers in transmission provider must identify the of first refusal when firm service the form of conditional firm service. We number of hours during the year in becomes available for the hours in therefore tentatively conclude that which the conditional firm customer which they have agreed to be curtailed. conditional firm service is not needed will have service identical to any other This rate for conditional firm service is by network customers, though we seek firm point-to-point service, and specify consistent with the Commission’s comment on that preliminary finding.305 the maximum number of hours of the pricing policies that promote 326. We acknowledge that the year during which firm transmission maximization of long-term uses of the obligation to provide conditional firm service may be unavailable. The grid. Also, this rate makes this service service may require the transmission conditional firm service agreement more equivalent to secondary network provider to model its transmission would identify the conditional service because network customers system and the uses of its system with curtailment hours, i.e., the number of using secondary network service already greater specificity. We recognize that all potential hours during those conditional have paid for the long-term use of the transmission providers do not use a times when the customer could have its grid. Further, it avoids gaming single standard engineering approach to reservations cut or reduced prior to any incentives that a discounted rate could evaluate firm transmission service firm customer reductions. Conditional provide. For example, a discounted rate requests: some transmission providers firm service would include an annual might provide incentives for customers have a single powerflow base case for cap to the conditional curtailment hours to request a year of service where they each year studied; some use a single and we seek comment on whether it know only three months of service is base case powerflow model to represent should also include monthly caps for available. We seek to prevent this type several future years; and others may each conditional month. Capacity of gaming by requiring the payment of have several seasonal base case commitments for conditional firm a long-term firm rate. In this regard, we powerflows for the study of future years. service would be accounted for in the also expect that the long-term firm Transmission providers also use ATC calculations prior to new sales of point-to-point rate will tend to limit the different methods to establish generator short-term firm transmission service, type and number of requests for dispatch for input into the powerflow thus not degrading the value of the conditional firm service. Customers will base case models: some transmission conditional firm transmission product. weigh the value of the service, including providers use heat-rates without fuel 322. We propose that conditional firm the probability of curtailment, against prices for determining generator output service would be curtailed before firm the cost of paying the full long-term firm in future years’ models; some use uses until such time as curtailment of rate, in deciding whether to queue for economic unit commitment order; and the conditional firm service has reached conditional firm service where others use projected fuel prices to the annual or monthly caps, after which customers earlier in the queue are establish base case powerflow time the service would be treated as offered, for example, 50, 100 or 150 generation output. Some transmission firm. We propose that conditional firm conditional curtailment hours. providers use an economic dispatch 324. Further, we propose that service, during conditional curtailment model to determine unit dispatch prior customers with conditional firm service hours, be treated equivalent to to establishing powerflow base cases. 304 would qualify for rollover rights secondary network service. We Additionally, some transmission provided that they meet the other decline to adopt the proposed quasi- providers must take into account rollover right conditions proposed firm curtailment priority because it environmental considerations, such as would require creation of a new herein. The service agreement for conditional firm service would specify the pricing of emissions allowances, in curtailment classification including a establishing generator output for determination concerning the the number of conditional curtailment hours. The transmission provider would powerflow base case models. appropriate type of curtailment, i.e., 327. Regardless of the engineering not be required to plan for service to the choosing between pro rata curtailment approach used, in responding to a conditional firm customer during the currently used for firm transactions or conditional firm request, the conditional curtailment hours. We seek full transaction curtailment currently transmission provider would need to used for non-firm transactions. comment on the application of rollover rights to the conditional firm service. specify for the requesting customer the Institution of a new curtailment class number of hours of firm service would require changes to curtailment 325. The Commission is not convinced that it is necessary to make available in the year for each MW of protocols and reliability coordinators’ this service available to network firm service requested. This may require procedures, which is potentially customers. Network customers enjoy 305 Network customers pay for long-term use of 304 Secondary network service (section 28.4 of the flexibility that point-to-point customers the system and should maintain priority use of the pro forma OATT) refers to transmission service for do not, given the ability of network system for secondary network service over those network customers from resources other than customers to use secondary network paying for non-firm use. However, because designated network resources provided on an as- service to access resources other than conditional firm customers will pay for long-term available basis. Section 14.7 of the pro forma OATT use, they should also maintain, for the conditional provides that secondary network service is curtailed designated resources on an as-available curtailment hours, a curtailment priority over non- or interrupted before firm network or point-to-point basis under section 28.4 of the pro firm uses equal to the curtailment priority for service but after non-firm point-to-point service. forma OATT. For example, if a network secondary network service.

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that the transmission provider produce level. This alternative method of track the number of annual conditional and examine additional powerflow calculating conditional curtailment curtailment hours in each service cases or make other process changes. In hours might be more burdensome than agreement and its annual or monthly order to determine the number of hours scaling down the powerflow base case use of those hours. Such a tracking that the requested firm transmission because it requires additional data mechanism would ensure that the capacity is unavailable, the transmission collection and analysis. transmission provider did not exceed provider may need to model varying 330. Both of these methods rely on the annual or monthly cap on load conditions, generation and average system conditions and do not conditional curtailment hours in any transmission planned outages, and time- take into account extreme weather years particular service agreement. contingent or condition-contingent or unexpected outages. Thus, the generation dispatches. Generally, the methods would provide an optimistic 2. Hourly Firm Service greater the number of conditions view of bulk power facility availability. studied, the lower the risk to the These methods can be used to 333. The pro forma OATT contains a transmission provider of an inaccurate determine the portion of time (hours) one-day minimum term for firm point- estimate of conditional curtailment that transmission capability will most to-point service. In Order No. 888, the hours. We recognize that there are limits likely be available and give general Commission chose a one-day minimum to the accuracy of any prediction of information on when (seasons, months) over a one-hour minimum because of hours of curtailment, no matter how firm service is available. concerns expressed by commenters.307 detailed the system study. 331. We seek comment on the most There, commenters argued that 328. There are a number of ways for appropriate method of modeling the comparability would not be achieved if a transmission provider to determine transmission system to determine the some point-to-point customers were the number of hours in a year when firm number of conditional curtailment permitted to take service for one hour service is unavailable, i.e., the hours. We also recognize that additional and receive the same priority as native conditional curtailment hours. One studies may cause additional costs. We load and other long-term customers that method involves scaling down the seek comment on methods of ensuring have to pay the fixed cost of the powerflow base case. Using this recovery of these additional costs. transmission system every hour of the method, the transmission provider 332. We also acknowledge that year. They also expressed concern that could scale down the load and provision of conditional firm service generation in the base case until the a one-hour minimum term for firm may require some modification to point-to-point service (hourly firm) entire conditional firm request is current transaction tracking procedures would promote selective use of the available on the studied flowgate. For in use by the industry and require transmission system, impair the ability example, a base case might need to be development of additional mechanisms. of a utility to plan its system, and scaled down to 95 percent of the Today, transmission providers track summer peak demand in order to transactions with curtailment priorities adversely affect longer term accommodate the conditional firm so that when congestion occurs transactions. Finally, some expressed request as firm point-to-point service. transactions are curtailed consistent concern that a one-hour firm service The transmission provider would then with OATT requirements, i.e., non-firm may encourage speculative requests for calculate the number of hours the uses are cut before firm uses and short- service during the system peak day (a seasonal load is forecast to be 95 percent term transactions are cut before longer- practice known as ‘‘cream skimming’’). or higher to come up with the number term transactions. In order to implement 334. In the NOI, the Commission of seasonal hours of curtailment for the the conditional firm service, noted that several public utility conditional firm customer. transmission providers would need to transmission providers have 329. Another method involves an determine in advance of scheduling inventory of generation and demand individually filed for and received deadlines whether the service should be Commission authorization to modify shift factors. Using this method, the tracked as a long-term firm use or to transmission provider could determine their OATTs to provide hourly firm reflect the use of the conditional 308 conditional curtailment hours by adding point-to-point service. In the NOI, the curtailment hours.306 If the service is up all the outstanding generation and Commission sought comment on treated as firm during a certain period, load shift factors on the relevant whether the concerns expressed in the transaction would not be cut before flowgate. Once the transmission Order No. 888 remain valid, and other firm uses. The transmission provider determines the load shift factor whether hourly firm service should now provider would have to perform a on the flowgate, it can calculate the be required. The Commission also asked calculus, taking into account forecast reduction needed in regional demand to whether hourly firm requests should be load and transmission and generation accommodate the conditional firm batched to allow the transmission availability, to determine the need to cut request by comparing the impact of the provider to evaluate them as if they the conditional firm transaction in the request on the power flows. The were a single request, and whether next period prior to scheduling the demand reduction would not scheduling timelines for firm and non- necessarily correspond perfectly with transaction as conditional firm. While we do not view this as an firm hourly transmission service should the requested amount of service. For differ. instance, a 200 MW reduction might be insurmountable problem, we note that required to accommodate a 100 MW the decision to curtail a conditional firm Comments conditional firm request. Once the transaction prior to other firm uses 335. Some commenters support transmission provider determines a simply cannot be made in real time. We reduced load level that would also note that the transmission provider requiring transmission providers to accommodate the conditional firm would need to develop a mechanism to request, the transmission provider 307 Order No. 888 at 31,752. 306 We propose that during conditional 308 The NOI cited Entergy Services, Inc., 85 FERC would examine load forecasts to curtailment hours, the transaction would be tagged 61,163 (1998), order on reh’g, 91 FERC 61,153 calculate the number of hours the load with the network non-firm tag (currently used for (2000) and El Paso Electric Co., Docket No. ER04– is expected to exceed this reduced load secondary network service). 567–000 (Apr. 9, 2004) (unpublished letter order).

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adopt hourly firm service.309 Alberta submitted load-based services such as service is to commence.315 For all firm Intervenors and TransAlta argue that secondary network service.312 But other services, schedules must be submitted hourly firm service encourages trade commenters who oppose requiring to the transmission provider no later and market liquidity. Regarding the hourly firm service state that the than 10 a.m. the day before service is to concerns cited in Order No. 888, EPSA concerns expressed in Order No. 888 commence.316 argues that, as a practical matter, daily may no longer be a major problem, and 342. Some commenters argue that firm service already receives an equal may be addressed by allowing hourly firm and non-firm hourly services priority to native load and other long- firm service to be pre-empted by longer should be subject to the same term customers, and none of the term firm service requests.313 scheduling timeline.317 To do concerns expressed in Order No. 888 338. TVA argues that reservations for otherwise, Snohomish argues, would be have materialized. ‘‘Cream skimming’’ hourly firm service would nearly always administratively burdensome and should not be a problem, EPSA end up being bumped by requests for without benefit to the transmission continues, because firm transmission longer service and as such would waste provider or transmission customer. reservations are not cost-free, and valuable time and increase Those arguing for different scheduling transmission customers are unlikely to administrative costs with no real timelines generally argue that the commit financial resources for benefit. scheduling time-frames for firm and speculative purposes. Constellation Processing non-firm transmission service should argues that there should be no concern remain different, at least on a pre- that comparability will be eroded 339. On the issue of whether a schedule or day-ahead basis, because because hourly firm service provides transmission customer should be the transmission provider must know additional flexibility to the competitive permitted to batch requests for service, the full extent of firm utilization before markets. PPL argues that in non-ISO/ those in favor generally state that non-firm offerings can be determined.318 RTO regions like the western United batching allows for greater States, hourly firm service could help to efficiencies.314 For example, Bonneville Discussion maximize the use of existing states that batching in the hourly market 343. The Commission proposes to add transmission facilities, increase would decrease the response time for all point-to-point hourly firm service to the efficiencies in wholesale markets, and requests in the hourly queue. Salt River pro forma OATT because it will allow customers to purchase only the states that a potential customer should eliminate a barrier to the development amount of firm transmission service that be able to submit a batch of requests of markets and thereby decrease they need. (e.g., a block of hours) that is useful in opportunities for undue discrimination. 336. Some commenters offer qualified shaping the service to its load-serving The terms of service we propose will support for hourly firm service.310 For needs. Snohomish states that in the day- ensure that hourly firm customers are example, South Carolina E&G states that ahead schedule submittals, batching of offered service in a manner consistent before the Commission requires hourly hourly firm transmission requests for with comparability principles, and pay firm service, it should obtain empirical evaluation as a single request should be their fair share of system costs. We market information on transmission permitted, but for periods prior to day- conclude that hoarding and speculation providers’ ability to provide such ahead, batching of hourly requests should not be a major concern because service. In its reply comments, Powerex should not be allowed due to the requests for hourly firm service are explains that there is a potential for a potential for ‘‘cream skimming.’’ subject to preemption by longer-term detrimental effect if a transmission 340. Among those opposed to or requests for service. We also conclude expressing reservations regarding provider is not able to accurately that the provision of hourly firm should batching, Ameren and EEI argue that determine its ATC, and before making have no effect on investment in the grid transmission providers already have the hourly firm service mandatory, the because a transmission provider does ability to process multiple requests from Commission should ensure that the not plan its system to meet hourly firm, the same party, but they caution that rights of long-term firm customers will or any other short-term firm, batching requests for simultaneous not be negatively affected. transmission requests. In addition, the modeling purposes (e.g., transmission 337. Among commenters who oppose expected effect of hourly firm on long- from points A to B and B to A requiring the adoption of hourly firm term transactions is no different than simultaneously) would be difficult to service,311 many repeat arguments that the effect of other short-term firm appeared in Order No. 888. For implement. WAPA states that, in its experience, the majority of hourly firm services. For example, though example, several commenters express transmission requests must be uniquely commenters are correct that hourly firm concern that hourly firm service will identified and evaluated for potential will be curtailed pro rata with longer lead to ‘‘cream skimming,’’ result in conflicts with longer-term firm term firm point-to-point service, this is unfairness to longer-term firm transmission requests. already true of daily firm point-to-point transmission customers who would service. As noted in the NOI, many have to be curtailed pro rata along with Scheduling transmission providers already offer this customers who have only made hourly 341. The pro forma OATT currently service and there appear to be no firm commitments, or create requires that schedules for firm and technical impediments to offering it, nor inefficiencies by having a higher non-firm service be submitted on have customers on these systems reservation priority than subsequently different timelines. Schedules for hourly non-firm point-to-point service must be 315 See pro forma OATT section 14.6 (also 309 E.g., Alberta Intervenors, Alcoa, Calpine, submitted to the transmission provider allowing schedules to be submitted by a reasonable Constellation, EPSA, HQ Energy, PPL, and time that is generally accepted in the region). TransAlta. no later than 2 p.m. the day before 316 See pro forma OATT section 13.8 (also 310 E.g., APPA, Northwestern, Powerex, Public allowing schedules to be submitted by a reasonable Power Council, Salt River, and South Carolina E&G. 312 E.g., LG&E, Progress Energy, Southern, and time that is generally accepted in the region). 311 E.g., Ameren, APS, Duke, EEI, KCP&L, LG&E, TAPS. 317 E.g., Ameren, Constellation, PNM–TNMP, LPPC, MidAmerican, NRECA, Progress Energy, 313 E.g., EEI and WAPA. Powerex, Salt River, Snohomish, and South Snohomish, Southern, TAPS, TVA, TDU Systems, 314 E.g., Alberta Intervenors, Bonneville, Carolina E&G. and WAPA. Constellation, EPSA, and South Carolina E&G. 318 E.g., Ameren, Northwestern, and Southern.

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expressed any concern about the effect period.322 To ensure that hourly 3. Rollover Rights of hourly firm on long-term firm customers do not pay more than their 348. Section 2.2 of the pro forma services or curtailments. Therefore, we fair share of fixed costs, consistent with OATT allows existing firm transmission conclude that the concerns expressed in the pricing principles set forth in Order service customers—wholesale Order No. 888 regarding unduly No. 888, the total charge in any day for requirements and transmission-only discriminatory effects of hourly firm hourly service cannot exceed the stated customers with contracts of one year or service have proven unfounded, and we daily rate multiplied by the maximum more—the right to continue to take propose that hourly firm service be a hourly capacity reservation during such transmission service from the 323 required offering in the pro forma day. We conclude that using the IES transmission provider when the OATT. Method to price hourly firm service at customer’s contract expires, rolls over or 344. As for the pricing of hourly firm a higher rate during peak periods will is renewed. The pro forma OATT service, consistent with Commission ensure that hourly firm customers pay a provides that the transmission precedent, we propose to use the ‘‘IES fair share of the costs of the reservation priority is independent of Method’’ and apply different pricing for transmission system and, as a result, whether the existing customer continues hourly firm service based on whether mitigate ‘‘cream-skimming’’ concerns. to purchase capacity and energy from the service is taken during peak or off- 345. As for allowing transmission the transmission provider or elects to peak hours.319 Pricing for hourly firm customers to batch requests for service, purchase capacity from another service during peak periods would be we conclude that allowing such supplier. This transmission reservation based on 4,160 hours annually of peak batching creates administrative priority for existing firm transmission usage over 52, 5-day weeks of 16-hour efficiencies for the transmission service customers, which is also referred days (52 × 5 × 16 = 4,160), rather than customer and transmission provider to as a right of first refusal or a rollover all 8760 hours of the year. In other alike. Therefore, we propose allowing right, is an ongoing right that may be words, the rate is derived from the transmission customers to batch exercised at the end of all firm contract hours during which the facilities are requests and schedules for hourly firm terms of one year or longer. A likely to be used, rather than the total service that will be provided within the transmission customer must give notice hours in the year. It is premised on the same day. of whether it will exercise its right of assumption that a customer using the 346. The Commission also concludes first refusal 60 days before the transmission system for the 16 peak that the current scheduling practices expiration of its service agreement. hours of the day should pay the same can accommodate the scheduling of 349. In Order No. 888, the contribution to fixed costs as a customer hourly firm transmission service. To Commission provided that, if a who has reserved capacity on a daily require that both firm and non-firm transmission customer subject to the basis.320 But because hourly service is hourly services be scheduled at the rollover right selects a new power unlikely to be taken only during peak same time would require that the supplier that substantially changes the location or direction of its power flows, hours, we propose to allow pricing for existing procedures be revised, with no the customer’s right to continue taking hourly firm service for off-peak hours discernible benefit to the transmission service from the transmission provider based on 8,760 hours of usage.321 This customer or transmission provider. Even may be affected by transmission is appropriate because customers using with the addition of this new service, it constraints associated with the short-term service during off-peak hours remains reasonable to require that the change.324 The Commission also do not constrict the system during the transmission provider have all firm provided that a transmission provider peak period, and should pay less than schedules at the same time, and in may reserve existing capacity for retail what they pay during the peak advance of the deadline for non-firm native load and network load growth schedules. Therefore, we propose that reasonably forecasted within the 319 The Method is named for a proceeding in schedules for firm hourly service, like transmission provider’s current which peak and off-peak pricing was applied to all other firm schedules, will be due by planning horizon, but that any capacity hourly non-firm transmission service. IES Utilities, 10 a.m. the day before the service is to Inc., 81 FERC ¶ 61,187 at 61,833–34 (1997), reh’g so reserved must be posted on the denied, 82 FERC ¶ 61,089, aff’d on other grounds commence. transmission provider’s OASIS and sub nom, Wisconsin Public Power Inc., v. FERC, 347. Finally, we propose that, 1999 U.S. App. LEXIS 3998 (Feb. 23, 1999) made available to others until the (unpublished opinion); see New York State Electric consistent with other durations of capacity is needed for the anticipated & Gas Corp., 92 FERC ¶ 61,169 at 61,593–94(2000) service, the confirmation period for network or retail native load use.325 The (approving application of the IES Method for time- hourly firm service specified in section Commission also has held that a differentiated hourly non-firm rate design), order on reh’g, 100 FERC ¶ 61,021 (2002). 13.2 of the pro forma OATT will allow transmission provider may restrict a 320 Peak period pricing is referred to as the longer-term requests for service to right of first refusal based on pre- ‘‘Appalachian Method’’ or ‘‘AEP Method,’’ and preempt shorter hourly firm requests for existing contracts that commence in the takes its name from the proceeding in which it service until one hour before the future if the transmission provider originated. Appalachian Power Co., 30 FERC commencement of hourly firm service. ¶ 61,296 (1987). The Appalachian Method is knows at the time of the execution of consistent with the premise that firm transmission the original service agreement that ATC service be priced based on the system’s peak 322 Appalachian Power Co., 39 FERC at 61,965; used to serve a customer will be periods of usage. See Entergy Services, Inc. 85 FERC see American Electric Power Service Corp., 88 FERC available for only a particular time ¶ 61,163, at 61,645 (1998) (approving application of ¶ 61,141 at 61,453–54 (1999). period, after which time it is already the method for firm service on an hourly basis 323 And, in turn, the total demand charge in any during peak hours), reh’g denied, 91 FERC ¶ 61,153 week pursuant to a reservation for hourly or daily committed to another transmission (2000). service cannot exceed the weekly rate multiplied by customer under a previously confirmed 321 See IES Utilities, Inc., 81 FERC at 61,833–34 the maximum hourly capacity reservation in any transmission request.326 Once a (approving use of an 8,760 hour year to calculate hour during such week. See pro forma OATT rates for non-firm service on an hourly basis during schedules 7 and 8; see also Entergy Services, Inc., off-peak hours); Entergy Services, Inc., 85 FERC at 85 FERC ¶61,163 at 61,645 (1998) (applying these 324 Order No. 888 at 31,665 n.176. 61,645 (approving use of an 8,760 hour year to principles to a proposal for firm service on an 325 Id. at 31,694. calculate rates for firm service on an hourly basis hourly basis), reh’g denied, 91 FERC ¶61,153 326 E.g., Southwest Power Pool, Inc., 109 FERC during off-peak hours). (2000). ¶ 61,041 at P 6 (2004).

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transmission provider evaluates the The Commission sought comment on many transmission providers suggest impact on its system of serving a long- whether the rollover right policy that the rollover right should apply to term firm transmission customer and determinations made subsequent to firm transmission contracts with grants the transmission customer Order No. 888 should be included in the minimum terms of between two and ten existing capacity, the transmission pro forma OATT. The Commission years.334 In addition, these commenters provider must plan and operate its inquired whether there were other suggest that, if the Commission system with the expectation that it will problems with section 2.2, either as lengthens the term of the firm contracts continue to provide service to the written or as implemented by eligible for the right of first refusal, the transmission customer should the transmission providers, that need to be 60-day renewal provision also should be transmission customer exercise the right addressed. The Commission also asked extended. of first refusal. If constraints arise after whether potential transmission 353. Certain transmission customers a transmission provider enters into a customers are denied transmission argue that the Commission should retain long-term agreement with the access by the exercise of rollover rights. the right of first refusal in its present transmission customer (and that Finally, the Commission asked whether form, or change it only after the agreement does not contain an allowed it should reconsider the concept of Commission requires regional planning restriction on the transmission rollover rights and whether the one-year or other events occur.335 Transmission customer’s right of first refusal), the service with rollover rights is consistent customers stress the need for the obligation is on the transmission with the need to create incentives for rollover rule as a means to ensure long- provider to determine whether or not to transmission investment or should a term service. According to build additional facilities to longer minimum term of service be Constellation, transmission customers accommodate new transmission adopted to qualify for rollover rights.330 subject to rollover rights are not 327 temporary customers but are long-term customers. A transmission provider Comments is obligated to curtail service pursuant customers that happen to take their to its OATT or expand its system when 352. Many transmission providers and service under year-to-year agreements. its system becomes constrained such APPA argue that, because a Likewise, EPSA asserts that rollover that it cannot satisfy existing transmission provider may not know rights are important in planning for the transmission customers, including the until 60 days prior to termination long-term needs of loads and generation exercise of their rollover rights, because whether a contract would be renewed, located on the grid and that ‘‘the ability it should have planned and operated its rollover rights in contracts as short as to roll over a firm transportation system with the expectation that each one year inhibit the ability of contract (by matching the contract term transmission providers to plan their and the rate of competing shippers) is long-term firm transmission customer 331 will exercise its rollover rights.328 systems. Transmission providers also the only way that market participants 350. If a transmission provider’s argue that the right of first refusal can ensure that their needs will be met.’’ transmission system cannot results in the denial of transmission that 354. Numerous commenters address accommodate all of the requests for leads to an inefficient use of the impact of native load growth on the 332 transmission service at the end of the transmission capacity. They explain right of first refusal rule. As previously contract term, the existing long-term that the transmission provider must indicated, the Commission permits transmission customer must agree to hold back capacity from the market for transmission providers to restrict a firm match the rate offered by the potential existing transmission customers that transmission customer’s right of first customer, up to the transmission have a right of first refusal but that have refusal based on the transmission provider’s maximum rate, and to accept not yet indicated whether they intend to provider’s reasonable projections of a contract term at least as long as that exercise it. By the time the termination native load growth. Several commenters offered by the potential customer. notice is given, other transmission argue, however, that the Commission However, a competitor’s offer does not customers that may have wanted to has not provided adequate guidance as reserve the newly freed capacity have have to be ‘‘substantially similar in all to the information a transmission been turned away and have made other respects’’ to the existing transmission provider must submit to demonstrate arrangements. They assert that the result native load growth.336 Further, customer’s.329 is an inefficient use of capacity. In commenters argue that the Commission The NOI addition, these transmission providers should allow transmission providers a 351. In the NOI, the Commission argue that the 60-day notice provision means to update their native load data sought comment on whether does not allow them adequate time to to address any load growth that was not transmission providers have hindered re-market any capacity when it is freed- anticipated at the time of the original transmission customers under pre-Order up by the terminating customer. contract. In addition, some commenters No. 888 agreements from rolling over Further, certain transmission providers argue that the Commission’s rejection of their contracts that allow purchase of argue that the right of first refusal native load growth projections in prior capacity and energy from another unfairly gives transmission customers a cases, and the provision for pro rata supplier. The Commission also asked valuable ‘‘free call option’’ on curtailment of service in the event of whether the language in section 2.2 of transmission capacity without any capacity shortfalls due to the exercise of the pro forma OATT needs to be obligation to take the capacity at the end a right of first refusal, fail to respect the reformed to ensure that rollover rights of the contract or to compensate the native load preference adopted in Order transmission provider for the value of No. 888, as well as in section 217 of the are provided when transmission 333 customers are seeking access to the option. To avoid these problems, FPA as added by section 1233 of EPAct alternative supply sources, or whether 330 NOI at P 18. 334 E.g., APPA, Bonneville, Cinergy, LDWP, the issue was an enforcement matter. 331 E.g., APPA, Bonneville, Duke, LPPC, Nevada MidAmerican, Nevada Companies, Progress, Santee Companies, Progress, and Salt River. Cooper, South Carolina E&G, and Southern. 327 Id. at P 9. 332 E.g., Ameren, Duke, EEI, North Carolina 335 E.g., AMP-Ohio, Calpine, Constellation, and 328 Id. Commission, Santa Clara, and South Carolina E&G. EPSA. 329 Idaho Power Co. v. FERC, 312 F.3d 454, 462 333 E.g., Ameren, Entergy, and Nevada 336 E.g., Duke, EEI, Entergy, Nevada Companies, (D.C. Cir. 2002). Companies. Progress Energy, Santee Cooper, and Salt River.

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2005. They argue that new section 217 357. If we adopt the proposed demonstrating forecasted native load of the FPA reverses Commission minimum five year/one year right of growth. Accordingly, we seek comment precedent that limits the ability of first refusal provision in the pro forma on whether there is a sufficiently clear, transmission providers to recall capacity OATT, we propose to allow this consistent, and transparent method that for native load once it is subject to a provision to become effective upon could be implemented on a generic right of first refusal. Commission acceptance of the basis to address the need for a transmission provider’s coordinated and transmission provider to demonstrate its Discussion regional planning process set forth in forecast of native load growth and its 355. The comments filed in response Attachment K of its OATTs. Thus, all effect on capacity reserved by right of to the NOI demonstrate a need to retain, new transmission service agreements first refusal customers. but revise, the right of first refusal executed after the effective date of 359. Many transmission providers provision in the pro forma OATT. The Attachment K will be subject to the five argue that our current right of first Commission proposes to revise the right year/one year right of first refusal rule. refusal policy is inconsistent with the of first refusal provision in the pro The Commission proposes that native load protections contained in forma OATT to apply to wholesale transmission service agreements subject section 217(b) of the FPA. We disagree, requirements and transmission-only to a right of first refusal entered into but note that the reforms being proposed contracts that have a minimum term of prior to the effective date of revised here should moot this argument. We are five years, rather than the current section 2.2, unless terminated, will proposing to extend the minimum term minimum term of one year. In addition, become subject to the five year/one year of the right of first refusal to a period the Commission proposes that a right of first refusal rule on the first (five years) that is more consistent with transmission customer under a rollover rollover date after the effective date of the planning horizons of transmission agreement must provide notice of revised section 2.2. providers. In addition, limiting the right whether or not it will exercise its right 358. Our existing policy allows the of first refusal to agreements with terms of first refusal no less than one year transmission provider to limit a of five years or more will ensure that the prior to the expiration date of the transmission customer’s right of first right of first refusal is used by customers transmission service agreement. We refusal by reserving capacity to with long-term obligations to purchase agree with APPA that these changes accommodate reasonably forecasted and capacity rather than as a means for strike an appropriate balance between verifiable native and network load customers with shorter-term providing customers meaningful growth at the time the initial service transactions to use capacity for non- rollover rights and encouraging long- agreement is executed. Many load-serving-entity transactions.337 This term contracting, new investment and transmission providers argue that this is consistent with FPA section 217(b)(4), long-term planning. Finally, if the right should be extended to allow the which states that the Commission shall existing customer seeks to exercise its transmission provider to limit the right exercise its authority ‘‘in a manner that rollover right and there is insufficient of first refusal each time the right of first facilitates the planning and expansion transmission capacity on the system at refusal is exercised, not only at the time of transmission facilities to meet the the end of the contract term to the initial service agreement is reasonable needs of load-serving entities accommodate all of the requests for executed. We believe that our proposal to satisfy the service obligations of the transmission service, the existing to extend the term of the right of first load-serving entities.’’ Our proposal also customer would have to agree to accept refusal from one to five years should is consistent with FPA section 217(b)(2) a contract term at least equal to a address, in many respects, the concern because it continues to allow the competing request by any new customer of transmission providers that the transmission provider to limit the right or five years, whichever is longer, and existing right of first refusal is unfair to of first refusal to accommodate to pay the current just and reasonable native load customers. Under this reasonably forecasted and verifiable rate, as approved by the Commission, proposal, a right of first refusal will no native load growth. for such service. longer be granted to users of the grid on 360. Under the proposed rule, 356. The Commission’s proposal is an annual basis, but rather only to those transmission providers still will be consistent with the transmission making longer-term commitments to the required to plan their systems with the customers’ comments that the right of grid, as do native load customers. In expectation that a transmission first refusal should be designed to addition, while we expect a 337 This is consistent with the approach suggested ensure long-term service. Extending the transmission provider to be continually by TAPS, which argues that the current one-year minimum term of the right of first updating its forecast for native load minimum contract term allows significant capacity refusal agreements to five years will growth and applying this updated on constrained interfaces to be tied up in relatively encourage long-term use of the grid. In projection to new requests for service, short-term deals simply designed to hold the firm reservation as a path for non-firm economy addition, the one-year prior notice applying this to contracts at rollover purchases and to block competitors’ firm access requirement should allow adequate time may require an additional change to the (e.g., inexpensive, one-year ‘‘paper capacity’’ deals). for transmission providers to re-market right of first refusal process. TAPS also argues that any restriction on the unused capacity that may result from a Specifically, the transmission provider availability and flexibility of rollover rights be contingent on an expansion of the transmission grid transmission customer choosing not to would have to compete for the capacity so that transmission customers have reasonable roll over a service agreement. The one- rather than reclaim it through its rights access to competitive supplies. We agree that year notice provision also should limit to reserve capacity for native load expansion of the grid is critical and accordingly the instances when the transmission growth. We seek comment on whether have proposed to require coordinated transmission planning on both a local and regional level to provider must turn away a transmission this change would be appropriate. ensure that transmission customers’ needs are request only to find out that it could Further, while we have addressed treated comparably to those of the transmission accommodate the request after the requests to limit the right of first refusal provider. This enhanced transmission planning, transmission customer elected not to on the basis of native load growth on a combined with other reforms proposed in this NOPR (e.g., improvements to the calculation of roll over. These changes should result in case-by-case basis, we recognize that ATC), should mitigate TAPS’s concerns by a more efficient use of the transmission this approach has not yet resulted in a improving the ability to access competitive grid. clear and transparent method for supplies.

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customer with a long-term transmission needed. The Commission did not Commission’s current redirect policies agreement subject to a right of first specifically ask about section 22.1, but are reasonable and practical. refusal will exercise its rollover right at some commenters nevertheless 366. A number of commenters focus the end of its term. We believe it is addressed this section. Most on other related transmission issues, important to reiterate the obligation on commenters, however, did not such as the flexibility afforded network transmission providers to maintain ATC distinguish whether they were service versus point-to-point service or for existing transmission customers with concerned with firm or non-firm other network-service-related issues; 339 rollover rights and our expectation that redirects and instead addressed the lack of flexibility with point-to-point transmission providers will include all redirects generally. service generally; 340 or issues customers with rollover rights in their associated with the interconnection of Comments long-term planning.338 We understand network load at new delivery points.341 363. APPA notes that many of its that some existing reliability procedures Discussion or practices may encourage transmission members have experienced difficulties providers to exclude certain in changing receipt points, especially 367. The Commission believes that it transmission service contracts from when such requests involve new has already addressed many of the their base-case models, even if those sources of supply. In many cases, APPA concerns raised by commenters with contracts contain a rollover right. This asserts that transmission providers regard to reform of section 22 of the pro is inconsistent with Commission policy require major upgrades before they will forma OATT in Docket No. RM05–5– and undermines the purpose of the grant a redirect to new points. The 000.342 In Order No. 676, the rollover right, which is to facilitate Public Power Council points out that Commission adopted the ‘‘Standards for system planning and reliability. redirecting to new points depends on Business Practices and Communication ATC, and, therefore, the ability to make Protocols for Public Utilities’’ developed 4. Modification of Receipt or Delivery changes would be improved by better by the NAESB’s Wholesale Electric Points public knowledge of ATC at those Quadrant (WEQ).343 Order No. 676 361. Section 22 of the pro forma points in all timeframes and by more incorporates the aforementioned OATT provides that a transmission information about ATC calculation standards by reference into the customer taking firm point-to-point methodologies. EPSA asserts that Commission’s regulations; requires service may modify its receipt and difficulty in redirecting to new points public utilities to implement the delivery points on either a non-firm or inhibits the ability to reassign capacity. standards by July 1, 2006; and requires a firm basis. Section 22.1 (Modifications Williams complains about delays by public utilities to file revisions to their on a Non-Firm Basis) provides that, transmission providers in answering OATTs to include these standards.344 subject to certain conditions, a firm requests for redirects and urges the The WEQ Standards recently adopted point-to-point customer may request Commission to enforce OATT by the Commission include a number of transmission service on a non-firm basis procedures and to consider a ‘‘fast- standards addressing requirements for over receipt and delivery points other track’’ process for reviewing requests to dealing with redirects on both a firm than those specified in its service redirect. and non-firm basis.345 In fact, all of the agreement (known as secondary receipt 364. Bonneville and EEI believe that WEQ Standards dealing with redirects and delivery points) in amounts not to any discrimination may be an were adopted by the Commission in exceed its firm capacity reservation, unintentional result of a lack of clarity Order No. 676, except for WEQ without incurring an additional non- in the pro forma OATT, and are joined Standard 001–9.7, which addresses the firm point-to-point service charge or by MidAmerican, Progress Energy, and impact of a firm redirect on a long-term executing a new service agreement. PNM–TNMP in calling for a number of firm transmission customer’s rollover Section 22.2 (Modifications on a Firm clarifications. MidAmerican believes rights under section 2.2 of the pro forma Basis) provides that any request to that these clarifications will provide OATT. The Commission directed the modify receipt and delivery points on a flexibility to transmission customers WEQ to reconsider WEQ Standard 001– firm basis shall be treated as a new and will enhance the ability to reassign 9.7 and to adopt a revised standard request for service in accordance with transmission service to customers consistent with the Commission’s section 17 of the pro forma OATT desiring different points of receipt or (Procedures for Arranging Firm Point-to- delivery. 339 E.g., Alberta Intervenors, Calpine, and TAPS. Point Transmission Service), except that 365. Southern and Ameren assert that 340 E.g., Occidental. the transmission customer shall not be because customers often make redirect 341 E.g., NRECA and TDU Systems. 342 obligated to pay any additional deposit requests at the last minute, there is often Standards for Business Practices and not enough time for the market to Communication Protocols for Public Utilities, Order if the capacity reservation does not No. 676, 71 FR 26199 (May 4, 2006), FERC Stats. exceed the amount reserved in the respond to capacity made available on & Regs. ¶ 31,216 (2006). existing service agreement. While such an abandoned path. Southern also 343 The WEQ was established by NAESB in new request is pending, the highlights the administrative burdens response to a Commission order requesting the and complexity (particularly for wholesale electric power industry to develop transmission customer retains its business practice standards and communication priority for service at the existing firm reliability) of processing short-term protocols by establishing a single consensus, receipt and delivery points specified in changes in service and suggests that the industry-wide standards organization for the its service agreement. Commission consider measures to wholesale electric industry. See id. at P 3–4. 362. In the NOI, the Commission encourage transmission customers to 344 The standards will hereinafter be referred to provide greater certainty as to the as the WEQ Standards. The Commission proposes asked whether transmission customers to add a reference to the WEQ standards in section have experienced undue discrimination expected paths along which they will 4 of the pro forma OATT, which identifies the in attempting to redirect to new receipt schedule service and to do so in a more Commission’s regulations containing the terms and and delivery points pursuant to section timely manner. Southern, along with conditions relevant to the OASIS and standards of Bonneville, also urges the Commission conduct. 22.2 and whether any reforms were 345 The requirements for dealing with redirects on to clarify rollover rights when service is a firm basis are found at WEQ Standard 001–9, et 338 See, e.g., Southern Company Services, Inc., redirected to new points. In general, seq., and the requirements for dealing with redirects 104 FERC ¶ 61,140 at P 26–27 (2003). however, Southern believes that the on a non-firm basis are found at 001–10, et seq.

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policies.346 The Commission also Specifically, as noted above, the WEQ is postings.351 In short, transmission offered guidance to assist the WEQ in in the process of reevaluating WEQ customers will have more accurate and developing a standard that is consistent Standard 001–9.7, dealing with redirects complete ATC information to utilize in with Commission policy.347 and rollovers, so that it is consistent evaluating their redirect options. 368. As noted above, we believe that with the Commission’s guidance given Moreover, through increased a number of concerns raised by in Order No. 676. The Commission transparency, transmission customers commenters are addressed by the WEQ requests comment on whether the WEQ will have the information they need to Standards. For example, we believe that process, along with the guidance question a transmission provider’s the request of commenters for provided by the Commission in Order denial of a request to redirect. Thus, we clarification that redirect service may be No. 676, is sufficient to address the believe that our reforms in the area of requested for only a portion of the concerns of commenters that seek transmission planning and ATC original quantity of service is addressed clarification on the interplay between calculation should go a long way toward for firm and non-firm service by WEQ redirects and rollovers. addressing transmission customer Standards 001–9.2 and 001–10.2, 370. The Commission understands, concerns in this area. Should respectively, which provide that the however, that there are also more commenters believe that our proposed transmission customer ‘‘shall be fundamental concerns with regard to reforms in this area will not address allowed to request a Redirect on a section 22 that were raised in the NOI. their concerns effectively, or that there [Firm/Non-Firm] basis for a portion or Many comments reflect concerns about is a better way of addressing them, we all of the Capacity Available to the inability of transmission customers encourage them to submit a specific Redirect.’’ Likewise, the request of to effectively redirect their transmission proposal, along with proposed revised commenters for clarification that it is service to new receipt and delivery pro forma OATT language. not necessary for a customer to redirect points in order to accommodate a new 372. We believe that redirects should its service for the entire remaining term transaction, the reassignment of be as customer-friendly as possible. of service is addressed for firm and non- capacity, or the designation of a new Other pro forma OATT reforms firm service by WEQ Standards 001–9.3 supply source. Generally, these proposed in this rulemaking should and 001–10.3, respectively, which commenters argue that their ability to improve the ability to redirect provide that the transmission customer redirect to new points is stymied by a transmission service to new points ‘‘shall be allowed to request a Redirect lack of ATC at the new points or the pursuant to section 22. For example, the on a [Firm/Non-Firm] basis for a portion need for major upgrades at the new modifications to firm point-to-point or all of the time period of the Parent points; or that the transmission provider service discussed above will be Reservation.’’ While we believe that takes too long to process its redirect applicable to a request to redirect on a many concerns expressed by request. Transmission providers, on the firm basis, as such requests are treated commenters with regard to redirects in other hand, complain of the as a new request for service under pro this proceeding have been addressed by administrative burdens and complexity forma OATT section 22.2. In addition, Order No. 676, we request that each (particularly with regard to reliability) reforms related to the acquisition of commenter reconsider its concerns in of processing transmission customers’ service discussed below (e.g., with this area with the benefit of Order No. short-term changes in service, and also regard to making and processing 676’s adoption of the WEQ Standards, assert that there is often not enough requests for service, queuing, and and inform us if additional concerns reservation priority) should, among remain. The Commission notes that time for the market to respond to other things, help to address several of the most active commenters capacity made available on customers’ transmission customer concerns that addressing redirects in this proceeding original paths. transmission providers are too slow in also were commenters in Docket No. 371. The ability to redirect to new processing redirect requests. These RM05–5–000 and therefore should be points is a function of whether there is reforms also should help to address familiar with whether a particular WEQ ATC at the new points. The Commission transmission provider concerns that Standard addresses the issues raised in believes that its proposed reforms customers do not respond completely the comments submitted in this requiring coordinated transmission and in a timely manner and that there proceeding.348 planning between transmission 369. The Commission anticipates that providers and their customers, as well is insufficient time to re-market capacity a number of other concerns, while as regional transmission planning open on the original paths. perhaps not yet addressed (or addressed to all stakeholders, will lead to a more 5. Acquisition of Transmission Service fully) by a WEQ Standard, are rationally planned transmission system a. Processing of Service Requests nevertheless the types of issues that will result in fewer transmission appropriate for the WEQ process. The constraints and more ATC available to 373. The pro forma OATT includes Commission therefore proposes that accommodate requests to redirect to requirements that transmission each commenter that continues to new points.350 Additionally, the providers process requests for believe additional reform is necessary in Commission’s proposed reforms transmission service in a timely fashion. this area also evaluate whether its regarding the calculation of ATC and Section 17.5 (Response to a Completed concerns would more appropriately be increased transparency over the process Application) and section 18.4 addressed by the WEQ as it considers its will engender increased confidence (Determination of Available next version of its standards.349 among transmission customers in their Transmission Capability) of the pro transmission providers’ ATC forma OATT provide that following the 346 Order No. 676 at P 52. receipt of a completed application for 347 Id. at P 53–61. practice standard, whether or not they are members service, the transmission provider must 348 For example, Bonneville, EEI, NRECA, and of NAESB, and each standard it adopts is supported respond to transmission customer Southern each commented in Docket No. RM05–5– by a consensus of the five industry segments: 000. Transmission, generation, marketers/brokers, requests for determinations of the 349 The Commission notes in this regard that the distribution/load-serving entities, and end-users. availability of firm and non-firm WEQ’s procedures ensure that all industry members See Order No. 676 at P 5 & n.5. can have input into the development of a business 350 Supra Part V.B. 351 Supra Part V.A.

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transmission capacity on a timely basis. to process requests for transmission required timelines on a path-specific The transmission provider must make service.352 EPSA notes that timeliness in basis, as well as the reasons for delays, the determination as soon as reasonably responding to transmission requests is a (c) require transmission providers practicable after receipt but no later consistent problem. Constellation states whose rate of compliance on a than certain specified time periods (or that the untimely processing of requests particular path falls below the such time periods generally accepted in for transmission service is a persistent Commission’s threshold to file a the region). Section 19 (Additional problem under the OATT, particularly compliance report with the Commission Study Procedures for Firm Point-to- with respect to long-term point-to-point identifying the problem(s) and Point Transmission Service Requests) of service, network service, and corrective measures that will be the pro forma OATT provides deadlines modification of network resource undertaken (including a timeline for that transmission providers must adhere designations. Arkansas Cities adds that, implementation of the corrective to in issuing system impact study under the current OATT, utilities’ measures), and (d) use a progressive agreements and facilities studies lenient application of time periods penalty system that begins with agreements and that transmission needed for the system impact study reporting and auditing requirements for customers must abide by in responding process and facilities study process non-compliant transmission providers to these study agreements. Section 19 cause transmission customers to endure and then moves toward monetary requires transmission providers to use significant amounts of time to obtain penalties in cases where a transmission due diligence to complete system confirmed firm delivery service at a provider exhibits a pattern of impact studies and facilities studies reasonable cost. uncorrected noncompliance, as well as within 60 days. Section 32 of the pro 376. A number of commenters suggest in any case where actual bad faith, forma OATT (Additional Study that transmission providers should discrimination or preferential treatment Procedures for Network Integration inform the Commission when they miss has occurred. Transmission Service Requests) the target deadlines for completing contains similar due diligence deadlines system impact studies and facilities 378. A number of transmission for completing system impact studies studies and/or post performance providers state that transmission service and facilities studies associated with statistics on their OASIS sites that detail request processing is slowed by requests for network service. the time it takes them to process system excessive requests for transmission 374. In the NOI, the Commission impact studies and facilities studies.353 service from the same transmission sought comment on problems EPSA states that it strongly believes that customer with essentially the same transmission customers and the new OATT should require the service attributes (e.g., point of receipt, transmission providers have transmission provider to notify the point of delivery, start time, end time, 355 experienced regarding the timely Commission when it is not able to meet firmness). A number of other processing of requests for transmission deadlines. TDU Systems suggests that commenters also argue that some service. In particular, the Commission one way to address the difficulty of transmission customers submit multiple sought comment regarding whether determining acceptable delays is to requests for transmission service with transmission customers have require transmission providers to post no intent to confirm most of the requests experienced delays by transmission statistics on their OASIS sites providing if and when the requests are 356 providers in responding to requests for information as to the length of time it accepted. MidAmerican states that it transmission service in general and, in might take to process requests for is aware of cases where customers have particular, what problems commenters transmission service. Cinergy proposes submitted multiple requests for service have experienced as transmission that adopting specific reporting metrics associated with a new generator where providers process the queue for requests that require transmission providers to the location of the new generator is not for transmission service that cannot be report certain statistics regarding their known but queue priority is being immediately granted due to a lack of performance could result in an sought by the transmission customer. ATC. We also asked about the type of improved quality of service. MidAmerican adds that the submission remedies the Commission should 377. A number of merchant generators of such multiple requests for service impose on public utility transmission propose that the Commission assess affects the processing of other lower providers for missing deadlines set forth operational penalties on transmission queued transmission requests. South in their OATTs. Another issue we providers that fail to meet the study Carolina E&G states that there are sought comment on was whether deadlines detailed in the pro forma instances when a transmission customer commenters have identified blocking OATT.354 LG&E recommends that the submits multiple requests intending to issues, such as where a customer Commission consistently enforce the proceed with a single request, seemingly submits multiple requests intending to established deadlines through penalties with the purpose of keeping others out proceed with a single request or other remedies unless good cause for of the queue. AWEA states that specifically to keep others out of the failure to comply can be shown, so as transmission queues are frequently queue; and if so, whether allowing to promote nondiscriminatory jammed with many projects holding transmission providers to charge a adherence to established deadlines. each other up. AWEA asserts that there processing fee would reduce the Powerex suggests that the Commission: often are ‘‘zombie’’ projects blocking the incentive to submit multiple self- (a) Identify a threshold percentage rate queue, without a power purchase competing requests. Finally, we sought of acceptable compliance with response agreement or other indication that they comment on whether the Commission timelines, (b) require transmission are serious projects. Suez Energy NA should require transmission providers providers to monitor and post their own responds that there are blocking issues to study transmission requests as a rates of compliance with Commission- when a transmission customer submits group. multiple requests for transmission Comments 352 E.g., Constellation, EPSA, Powerex, and Williams. 355 E.g., MidAmerican, Progress Energy, South 375. A number of merchant generators 353 E.g., Cinergy, Constellation, EPSA, Carolina E&G, and Southern. articulated general concerns regarding MidAmerican, Powerex, and TDU Systems. 356 E.g., Alberta Intervenors, AWEA, Public Power the time it takes transmission providers 354 E.g., EPSA, Powerex, and Williams. Council, and Suez Energy NA.

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service but intends to proceed with a Discussion Æ Average time (days) from receipt of single request. 382. We agree with commenters who executed System Impact Study 379. Several federal power agencies argue that requiring transmission Agreement to date when completed suggest that charging a fee on providers to report the length of time System Impact Study made available to the Transmission Customer transmission service requests could they take to complete studies pursuant Æ provide the right incentive to to sections 19 and 32 of the pro forma Average cost of System Impact Studies completed during the period transmission customers to limit requests OATT would increase transparency and • Service Requests Withdrawn from for transmission service to only those improve the ability of transmission System Impact Study Queue 357 customers and the Commission to detect requests they expect to confirm. Æ Number of requests withdrawn undue discrimination. Therefore, we Several other commenters suggest a from the System Impact Study queue 358 propose to require transmission similar fee. Bonneville supports the Æ Number of System Impact Studies providers to post on their OASIS sites imposition of a processing fee for withdrawn more than 60 days after metrics that track their performance in multiple requests to provide a receipt of executed System Impact processing system impact studies and disincentive to blocking behavior. Study Agreement Bonneville suggests that the fee should facilities studies associated with Æ Average time (days) from receipt of provide a disincentive for making requests for transmission service. executed System Impact Study multiple, ‘‘self-competing’’ requests. Transmission providers will be required Agreement to date when request was Bonneville suggests that, at a minimum, to post the performance metrics, withdrawn from the System Impact requests with the same point of receipt, outlined below, for each calendar Study queue point of delivery, source, sink, and time- quarter. Transmission providers should • Process Time from Completed frame should be considered ‘‘self- begin tracking their performance upon System Impact Study to Offer of competing.’’ In addition, Bonneville the effective date of the final rule in this Facilities Study pursuant to Sections contends that transmission providers proceeding and keep the quarterly 19.4 and 32.4 of the pro forma OATT should be allowed to define parameters performance metrics posted on their Æ Number of new Facilities Study to identify additional instances of ‘‘self- OASIS sites for three calendar years. Agreements delivered to Transmission competing’’ requests on their systems. The transmission provider will be Customers South Carolina E&G argues that there is required to post the quarterly Æ Number of new Facilities Study merit to the concept of charging a performance metrics within 15 days of Agreements delivered to Transmission processing fee that would increase with the end of the quarter. The performance Customers more than 30 days after the the duration of the requested service, to metrics outlined below should be completion of the System Impact Study reduce the incentive to submit multiple calculated separately for affiliates’ and Æ Average time (days) from self-competing requests. non-affiliates’ requests for short-term completion of System Impact Study to and long-term transmission service. A delivery of Facilities Study Agreement 380. The majority of commenters were transmission provider also will be Æ Number of new Facilities Study in favor of allowing, but not requiring, required to post performance metrics for Agreements executed transmission providers to study requests studies that it conducts for RTOs. • Facilities Study Processing Time for transmission service as a group, also 383. We propose to require pursuant to Sections 19.4 and 32.4 known as clustering requests for transmission providers to post the Æ Number of Facilities Studies 359 transmission service. APPA and following set of performance metrics on completed Bonneville suggest amending the pro a quarterly basis: Æ Number of Facilities Studies forma OATT so that all requests • Process Time from Initial Service completed more than 60 days after received during a set time period are Request to Offer of System Impact Study receipt of executed Facilities Study studied together. EEI argues that the Agreement pursuant to Sections 17.5, Agreement Commission should not require the 19.1 and 32.1 of the pro forma OATT Æ Average time (days) from receipt of studying of transmission requests as a Æ Number of new System Impact executed Facilities Study Agreement to group, though transmission providers Study Agreements delivered to date when completed Facilities Study should continue to have the discretion Transmission Customers made available to the Transmission to cluster transmission requests when it Æ Number of new System Impact Customer is efficient to do so. EPSA states that Study Agreements delivered to the Æ Average cost of Facilities Studies clustering should not be required, but Transmission Customer more than 30 completed during the period may be considered as a customer option days after the Transmission Customer Æ Average cost of recommended as part of a comprehensive planning submitted its request upgrades for Facilities Studies process. Æ Average time (days) from request completed during the period • 381. Bonneville suggests that the submittal to change in request status Service Requests Withdrawn from Æ Average time (days) from request Facilities Study Queue Commission adopt two NAESB Æ proposed business standards designed submittal to delivery of System Impact Number of requests withdrawn Study Agreement from the Facilities Study queue to reduce the number of self-competing Æ Æ requests. In particular, Bonneville Number of new System Impact Number of Facilities Studies believes the Commission should adopt Study Agreements executed withdrawn more than 60 days after • System Impact Study Processing NAESB’s proposed queue hoarding receipt of executed Facilities Study Time pursuant to Sections 19.3 and 32.3 business practice and queue flooding Agreement of the pro forma OATT Æ Average time (days) from receipt of business practice. Æ Number of System Impact Studies executed Facilities Study Agreement to completed date when request was withdrawn from 357 E.g., Bonneville and TVA. Æ Number of System Impact Studies the Facilities Study queue 358 E.g., Alberta Intervenors, Snohomish, and South Carolina E&G. completed more than 60 days after 384. We also propose to impose 359 E.g., EEI, EPSA, Nevada Companies, receipt of executed System Impact operational penalties when transmission PacifiCorp, PNM–TNMP, Powerex, and Southern. Study Agreement providers routinely fail to meet the 60-

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day due diligence deadlines prescribed that RTOs will not be subject to this under which the processing fee would in sections 19.3, 19.4, 32.3 and 32.4 of penalty regime. be refunded to or credited to the the pro forma OATT. We propose to 385. In addition to the operational transmission customer. require a transmission provider to file a penalty described above, we propose to 388. In Order No. 2003, we notice with the Commission in the event require transmission providers to post encouraged transmission providers to the transmission provider processes on their OASIS sites additional study interconnection requests in more than 20 percent of non-affiliates’ performance metrics after making a clusters.361 We likewise encourage studies outside of the 60-day due notification filing. Transmission transmission providers to study requests diligence deadlines in the pro forma providers will have to post these for transmission service in clusters, OATT for two consecutive quarters. For performance metrics until they process though we will not require transmission the purposes of calculating this at least 90 percent of all system impact providers to cluster requests for notification trigger, the transmission and facilities studies within 60 days transmission service for study provider should aggregate all system after the study agreement has been purposes.362 As with interconnection impact studies and facilities studies that executed. Starting the quarter following requests, studying requests for it completes during the quarter for non- a notification filing, the transmission transmission service in clusters allows affiliates.360 The transmission provider provider will be required to post: (1) the transmission provider to consider all may explain in its notification filing that The average, across completed system requested uses of the transmission it believes there are extenuating impact studies, of the employee-hours system at one time. We seek comment circumstances that prevented it from expended per completed system impact regarding whether transmission meeting the deadlines in the pro forma study; (2) the average, across completed providers should be required to study OATT. The transmission provider then facilities studies, of employee-hours requests for transmission service in a will be subject to an operational penalty expended per completed facilities group if the transmission provider fails if the transmission provider continues study, (3) the number of employees to complete studies on a timely basis; to be out of compliance with the devoted to processing system impact and, if so, we seek comment on the deadlines prescribed in the pro forma studies, and (4) the number of circumstances that should trigger such a OATT for each of the two quarters employees devoted to processing requirement and the appropriate following its notification filing. The facilities studies. These additional method of implementing the transmission provider will be deemed to performance metrics should be requirement. We further seek comment calculated separately for affiliates’ and be out of compliance if it completes 10 regarding whether transmission non-affiliates’ requests for transmission providers should be required to study percent or more of non-affiliates’ system service and for short-term and long-term requests for transmission service in a impact studies and facilities studies transmission service. group if all the transmission customers outside of the deadlines prescribed in 386. In addition to the operational in the group agree to cluster their the pro forma OATT. The operational penalties described above, we may order requests. We also seek comment penalty will be assessed on a quarterly other remedial actions, consistent with regarding how to select the requests that basis, starting with the quarter following the Enforcement Policy Statement. Any belong to a cluster so that transmission the notification filing and continuing other remedial action will be customers cannot ‘‘cherry-pick’’ clusters until the transmission provider determined on a case-by-case basis. The to avoid transmission system upgrade completes at least 90 percent of all transmission provider will pay the costs. studies within 60 days after the study operational penalty described above, 389. In Order No. 676, we agreement has been executed. For any consistent with the proposed rule incorporated by reference a number of system impact study or facilities study discussed in Part V.C.4.b. The NAESB business practices, including completed during that quarter and more transmission provider cannot recover the business standards on queue than 60 days after the study agreement for ratemaking purposes any operational hoarding and queue flooding.363 was executed, the penalty will equal penalty it pays for failing to process NAESB’s queue hoarding business $500 for each day the transmission transmission service studies on a timely practice allows transmission providers provider takes to complete the study basis. to deny a transmission customer’s beyond 60 days. For any system impact 387. With respect to the problem of identical requests for transmission study or facilities study that is still multiple, self-competing transmission service if the customer elects not to pending at the end of the quarter and service requests, we seek comment on a accept an initial offer of identical, or that has been in the study queue for fee structure that could provide a substantially identical, transmission more than 60 days, the penalty will disincentive for transmission customers service. NAESB’s queue flooding equal $500 for each day the study has to submit such duplicative requests business practice allows a transmission been in the study queue beyond 60 without penalizing transmission provider to invalidate the submission of days. Because of their independence, we customers that have legitimate requests additional identical requests for do not believe that RTOs have an for transmission service. We seek transmission service when the sum of incentive to neglect their obligation to detailed recommendations, including all previously submitted identical process applications for service in a any proposed tariff language, regarding requests for transmission service equals timely fashion. As a result, we propose the standards we would use to identify or exceeds the total transfer capability requests that would be subject to a fee. on the requested path for any time 360 For instance, if the transmission provider We also seek recommendations on the period during the duration of the completes 4 non-affiliates’ system impact studies level of the fee that balances our policy requests. We would consider the during the quarter with 2 completed more than 60 days after the system impact study agreement was goals to discourage requests for decision by a transmission provider to executed and completes 2 non-affiliates’ facilities transmission service that the studies during the quarter with none completed transmission customer does not intend 361 Order No. 2003 at P 155. more than 60 days after the facilities study to confirm while not discouraging 362 We note that we previously have allowed agreement was executed, then the transmission transmission providers to study requests for provider will be deemed to have completed 2 out legitimate requests for transmission transmission service in a group. See, e.g., Southwest of 6 (33 percent) studies outside of the deadlines service. Finally, we seek comment Power Pool, Inc., 110 FERC ¶ 61,028 at P 16 (2005). in the pro forma OATT. regarding the circumstances, if any, 363 See Order No. 676 at P 19.

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deny service under the queue hoarding continues, SPP’s tariff explains that Comments business practice and the decision to hourly, non-firm transmission service 395. Most transmission providers and invalidate requests under the queue requests for the next hour may be federal power agencies respond that the flooding business practice to be an act submitted no later than 20 minutes prior first-come, first-served approach to of discretion under 18 CFR 37.6(g)(4) to the start of service. allocating transmission service is the (2005). As a result, the transmission best alternative available.367 provider is to log the actions it takes Discussion Several merchant generators and public power under the queue flooding and queue 393. Order No. 676 contains many of hoarding business practices. entities concur that no better alternative the business practices we expect exists.368 Several commenters suggest b. Queue Processing Business Practices transmission providers to follow when that the first-come, first-served approach they process requests for transmission 390. The set of uniform business may provide an advantage to service, including the issue Calpine practices adopted in Order No. 676 transmission customers who have the raises in its comments about relating to transmission service price financial resources to purchase software discrepancies between Entergy’s and negotiation and on improving and employ staff to continually monitor 369 interaction between transmission SPP’s processes for requests for hourly OASIS sites. Santa Clara states that customers and transmission providers non-firm transmission service. Calpine’s entities that have superior software and over OASIS nodes. These business comment addresses the deadline for are able to consistently procure capacity practices include standards for the time transmission customers to submit to the exclusion of other market limit within which (1) transmission requests for non-firm hourly point-to- participants may have an unfair providers must respond to requests for point service and the deadline for advantage. transmission service, (2) transmission transmission providers to respond to 396. For the short-term market, customers must confirm service, and (3) requests for non-firm hourly point-to- Bonneville contends, the first-come, transmission providers must respond to point service. Standard 001–4.13 in first-served approach has two defects: a rebid from a transmission customer.364 Order No. 676 indicates that (1) It advantages larger and better- These business practices also include transmission providers should use their financed transmission customers, which negotiation priority rules, including the best efforts to respond to requests for can continually monitor OASIS sites terms under which a request can be pre- non-firm hourly point-to-point service and submit requests electronically the empted and under which a request has that are submitted less than an hour moment new ATC is posted; and (2) it the right-of-first-refusal.365 prior to start and transmission providers results in arbitrary awards of transfer 391. In the NOI, the Commission should respond within 30 minutes to capability when one customer’s sought comment regarding whether requests that are submitted more than submission precedes a second there are provisions of the pro forma an hour before start. In addition, in this customer’s submission by mere seconds. OATT that need to be reformed to better NOPR we have provided additional Bonneville suggests that the define the obligations of public utility clarity regarding the calculation of ATC Commission modify the first-come, first- transmission providers in responding to and requirements for processing rollover served rule for awarding short-term firm requests for transmission service. requests. We also provide general point-to-point service capacity so that guidance regarding which business all requests submitted within a given Comments practices should be filed as part of a time-frame are considered 392. Several commenters asked that transmission provider’s OATT and simultaneously submitted. the Commission require transmission which should be posted on OASIS. 397. Several commenters propose providers to post standard business Given this additional clarity and the some version of priority preference for practices that describe how the business practices already mandated by requests for transmission service that transmission provider will process Order No. 676, we seek comment on are pre-confirmed.370 Bonneville states requests for transmission service.366 whether commenters believe additional that transmission customers flood the MidAmerican suggests that transmission standardization of request queue queue with unconfirmed requests to providers should be required to post on processing is necessary. If so, we seek force competitors with higher queue their OASIS sites a business practice comment on the specific issues positions to extend the length of their documenting how they process their commenters believe are not clearly requests to retain their queue positions. queues, requests outside the queue, and prescribed in Order No. 676 or this 398. Bonneville suggests that the expected completion times. Calpine NOPR and which require additional Commission consider reducing the time believes that the processing of requests mandatory queue processing business transmission customers have to confirm for transmission service, and the practices. requests for short-term transmission deadlines associated with that process, c. Reservation Priority service after the transmission provider should be standardized for all has accepted a request for short-term transmission service providers. For 394. Section 13.2 of the pro forma transmission service. Bonneville states example, Calpine notes that Entergy’s OATT requires transmission providers that a shorter time-frame would clear OASIS business practices state that to process requests for long-term firm the short-term firm transmission market Entergy will respond to fixed, hourly point-to-point service on a first-come, more quickly and make it more difficult non-firm transmission service requests first-served basis. In the NOI, we asked for transmission customers to tie up ‘‘within 30 minutes of receiving the whether the first-come, first-served scarce transfer capability. request for the requests received earlier approach to reservation priorities has than 1 hour before the service is to resulted in a fair and equitable means of 367 E.g., Ameren, EEI, Nevada Companies, TVA, commence.’’ By comparison, Calpine allocating transmission capacity when and WAPA. the transmission system is 368 E.g., NRECA, Powerex, Public Power Council, 364 Id., Standards 001–4.6 and 001–4.13. Sempra, and TDU Systems. 365 Id., Standards 001–4.14 and 001–4.16. oversubscribed. If not, we asked 369 E.g., Bonneville and Santa Clara. 366 E.g., Calpine, MidAmerican, and TDU whether an alternative approach should 370 E.g., Bonneville, Entergy, and South Carolina Systems. be implemented. E&G.

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399. Powerex suggests that the provider is willing to discount customer to pay for the purchase.371 In Commission clarify its reservation transmission service. Price would serve WPPI, the Commission found that a priority standards so that when as a tie-breaker after pre-confirmation network customer can designate as a transmission providers make use of for those requests that are not yet network resource a system purchase that discounts in short-term service, price confirmed. As a result, a pre-confirmed is not backed by a specific generator.372 (not to exceed the ceiling price) should request for short-term firm point-to- The Commission found that Wisconsin be the third-level tie breaking point service would preempt another Public Service Corporation (WPS) had mechanism, with higher-priced requests pre-confirmed request for short-term appropriately designated a power of equal duration having greater priority firm point-to-point service that has an purchase as a network resource, even and requests earlier in the open access though the power purchase agreement earlier queue time, and an equal or same-time information system having did not require WPS to take energy shorter duration but a lower offer price. right of first refusal to match subsequent around the clock and allowed WPS to requests. Powerex states that in the However, a request for short-term firm convert its energy purchase to a presence of discounting, the open access point-to-point service that is not pre- discounted product that could be transmission tariff allows a higher value confirmed would not preempt a pre- interrupted.373 In addition, the service (firm) to be sold at a lower price confirmed request for short-term firm Commission stated that because the pro than a lower value service (non-firm) point-to-point service that has an earlier forma OATT requires a power purchase even in the same operating horizon, queue time, and an equal or shorter to be noninterruptible, third-party because price based displacement only duration but a lower offer price. transmission arrangements to deliver applies to short-term non-firm 6. Designation of Network Resources the resource to the network have to be transmission services. noninterruptible as well.374 In Illinois a. Qualification as a Network Resource Power, the Commission found that a Discussion firm purchase need not be backed by a 400. In response to comments that 403. Taken together, the following capacity purchase to qualify as a transmission customers that have the sections of the pro forma OATT network resource.375 financial resources to purchase software describe the resources a network 405. In the NOI, the Commission and employ staff to continually monitor customer can appropriately designate as sought comment regarding whether OASIS sites have an unfair advantage a network resource. Section 30.1 of the network resources consisting of firm under a first-come, first-served pro forma OATT describes network contracts that do not specify generation approach, we seek comment regarding resources as all generation owned or sources until the energy is scheduled whether any such advantage would be purchased by the network customer (so-called ‘‘seller’s choice contracts’’) mitigated if all requests submitted designated to serve network load under are a problem. The Commission also within a 5-minute window, with the tariff. Section 30.1 also indicates sought comment on the specific duration as a tie breaker, were deemed that network resources may not include difficulties entities have experienced to have been submitted simultaneously. resources that are committed for sale to with designation of network resources We also seek comment on whether non-designated third-party load or and asked what reforms are needed to transmission customers could game a 5 otherwise cannot be called upon to meet the designations provision in the pro minute equivalent priority standard to the network customer’s network load on forma OATT. request transmission service only after a noninterruptible basis. Pursuant to another transmission customer has Comments section 30.7 of the pro forma OATT, the made a request. To the extent we adopt 406. A number of commenters network customer must demonstrate a 5 minute equivalent priority standard, indicate that firm contracts that do not that it owns or has committed to we propose to allocate capacity on a pro specify generation sources are rata basis, though we seek comment on purchase generation pursuant to an acceptable network resources as long as other methods for allocating limited executed contract in order to designate the network customer specifies enough transmission capacity among equivalent a generating resource as a network information for the transmission priority requests of equal duration. resource. Alternatively, the network provider to identify how the contract 401. We also propose to change the customer may establish that execution power will enter its control area.376 priority rules to give priority to pre- of a contract is contingent upon the Bonneville suggests that the customer confirmed requests. As a result, a pre- availability of network service. Section should be required to identify the confirmed short-term request for firm 29.2 requires the network customer to point(s) of receipt on the transmission transmission service would preempt any provide the following information about provider’s system whenever it non-pre-confirmed short-term requests, a power purchase agreement that is to designates a network resource. EEI regardless of duration. Similarly, a pre- serve as a new designated network states that the designation of seller’s confirmed request for long-term firm resource: source of supply, control area choice contracts as network resources is transmission service would preempt a location, transmission arrangements and only problematic if the seller’s choice request for long-term transmission delivery point(s) to the transmission contract permits the seller to choose the service that is not pre-confirmed. We provider’s transmission system. 371 Morgan Stanley Capital Group v. Illinois seek comment on whether this change 404. The Commission has issued a to the reservation priority rules will Power Co., 83 FERC ¶ 61,204 at 61,911–12 (1998), number of orders that clarify which order on reh’g, 93 FERC ¶ 61,081 (2000) (MSCG). alleviate concerns commenters have resources meet the criteria set out in 372 Wisconsin Public Power Inc. v. Wisconsin expressed regarding the flooding or sections 30.1 and 30.7 of the pro forma Public Service Corp., 84 FERC ¶ 61,120 at 61,650– jamming of the transmission queue by 51 (1998) (WPPI). transmission customers who submit OATT. In MSCG, the Commission stated 373 Id. multiple requests for transmission that network resources must be 374 Id. at 61,660. 375 service. generating resources owned by the Illinois Power Co., 102 FERC ¶ 61,257 at P 14 (2003), reh’g denied, 108 FERC ¶ 61,175 (2004) 402. We propose to add price as a tie- network customer or purchases of noninterruptible power under executed (Illinois Power). breaker in determining reservation 376 E.g., Bonneville, EEI, Nevada Companies, queue priority when the transmission contracts that require the network Public Power Council, and TVA.

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flowgate path over which the energy addition, third party transmission requirements for obtaining tariff service, will be delivered. EEI further explains arrangements to deliver the purchase to possibly including contractual terms.377 that no issue is present if the seller is the network have to be noninterruptible The Commission went on to state that limited to a single path or flowgate. On as well. it expected a transmission provider’s the other hand, PNM–TNMP argues that 409. In response to comments that merchant function to police its own allowing seller’s choice contracts to be seller’s choice contracts are problematic compliance with tariff obligations.378 considered network resources because the network customer can Comments significantly complicates transmission provide limited, if any, information planning, as virtually none of the required by section 29.2 of the pro 412. LG&E suggests that the pro forma information required by section 29.2 of forma OATT, we reiterate that a request OATT require the transmission provider the OATT can be provided. to designate a new network resource to have a process to verify that each 407. Several commenters cited must include the information specified load-serving entity has a contractual specific difficulties with or suggested in section 29.2(v), including the source right to the resources they are specific modifications to the network of supply, control area location, designating. LG&E argues this would designation provisions of the tariff. transmission arrangements, and delivery help eliminate concerns over double APPA indicated that under the point(s) to the transmission provider’s booking of resources by two parties. liquidated damages provisions in the transmission system. When a network EPSA states that transmission providers EEI contract, it is the buyer’s customer is designating a system have attempted to require customers to responsibility to go out into the market purchase as a new network resource, the demonstrate that they have obtained to purchase replacement supplies source information required in section contracts covering an annual period, (cover), and the seller then pays the 29.2(v) should identify that the resource rather than allowing customers to buyer the difference between the is a system purchase and should provide reasonable advance notice for contract price and the cover price. identify the control area from which the each contract during the service period. APPA states that these provisions are power will originate. A power purchase EPSA asks the Commission to prohibit not consistent with the concept of agreement that is structured so that a this practice. having to specify generation resources network customer cannot specify all of Discussion or contracts as network resources, since the information required by section the actual source and supplier of 29.2(v) cannot be designated as a 413. We clarify that transmission generation may well change at a time network resource. providers are not responsible for when both wholesale power supplies 410. In response to suggestions that verifying that the generating units and and transmission capacity are at a liquidated damages products should not power purchase agreements network premium. Ameren suggests that the be designated network resources customers designate as network Commission clarify that liquidated because they are interruptible for resources satisfy the requirements in damages products cannot be designated economic reasons, we clarify that sections 30.1 and 30.7 of the pro forma network resources. Ameren states that a network customers may not designate as OATT. While transmission providers liquidated damages contract allows a network resources those power are responsible for verifying that the supplier to walk away from a deal if it purchase agreements that give the seller network customer has provided all the can obtain a price elsewhere high a contractual right to compensate the information section 29.2 requires the enough to offset the liquidated damages buyer instead of delivering power even network customer to provide, the provisions. Ameren argues that if the seller is able to deliver power. For transmission provider is not responsible liquidated damages contracts are instance, a network customer may not for obtaining contractual terms to verify financial instruments that produce no designate as a network resource a requirements in sections 30.1 and 30.7 electricity. MidAmerican also contends purchase agreement that allows the of the pro forma OATT. The that provisions for designating seller to interrupt service for reasons transmission provider continues to have liquidated damages contracts as network other than reliability, but allows the the responsibility to verify that third- resources should be eliminated. buyer to force delivery at a higher price. party transmission arrangements to Southwestern urges the Commission to In addition, a network customer may deliver the purchase to the transmission reform the OATT to make it clear that not designate as a network resource a provider’s system are firm. a firm purchased power contract with purchase agreement that requires a 414. We propose to require the liquidated damages should be eligible to seller to pay the buyer’s cost of transmission provider’s merchant be considered a designated network replacement power when the seller function as well as network customers resource. chooses not to deliver energy for to include a statement with each economic reasons. application to designate a new network Discussion resource that attests that: (1) The b. Documentation for Network 408. We propose to maintain our transmission customer owns or has Resources current policy regarding the power committed to purchase the new purchase agreements that network 411. Section 30.2 of the pro forma designated network resource, and (2) the customers may designate as network OATT stipulates that a network new designated network resource resources. In particular, a network customer request the designation of a comports with the requirements for customer will continue to be able to new network resource by a request for designated network resources. The designate resources from system modification of service pursuant to an network customer should include this purchases not linked to a specific application under section 29 of the pro attestation in the customer’s comment generating unit, provided the purchase forma OATT, and section 29.2 stipulates section of the request when it confirms power agreement is not interruptible for that the network customer must provide the request. Similarly, we propose that economic reasons, does not allow the specified information about its all entities that submit an application seller to fail to perform under the designated network resources. The for network service be required to contract for economic reasons, and the Commission found in WPPI that executed contract requires the network transmission customers may need to 377 WPPI at 61,660. customer to pay for the purchase. In document compliance with specific 378 Id.

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include a statement with the application notification to the transmission provider to undesignate resources or portions for service that attests that, for each as soon as reasonably practicable. thereof in order to make firm sales out network resource identified in the 418. In Order No. 888–B, the of generation fleets that they have application for service: (1) The Commission clarified that the pro forma designated as a network resource. transmission customer owns or has OATT allows network customers to Discussion committed to purchase the designated designate network resources over network resource, and (2) the designated shorter time periods. The Commission 423. We propose to continue to allow network resource comports with the indicated that a network customer that network customers to undesignate a requirements for designated network seeks to engage in firm sales from its portion of their network resources on a resources. current designated network resources short-term basis to make off-system 415. We propose that if the network may terminate the generating resource sales. We reiterate that a network customer does not include an attestation (or a portion of it) as a network resource customer may redesignate the resource when it confirms its request, the pursuant to section 30.3 of the pro by making a request to designate a new transmission provider will notify the forma OATT and request, as set forth in network resource. In response to network customer within 15 days of section 29 of the pro forma OATT, that comments that the transmission confirmation that its request is deficient. the same generation resource be provider also should be required to Wherever possible, the transmission designated as a network resource undesignate network resources when provider will attempt to remedy effective with the end of its power the transmission provider makes firm deficiencies in the request through sale.379 off-system sales, we reiterate that the informal communications with the 419. In the NOI, the Commission transmission provider must abide by network customer. If such efforts are sought comment on whether network both the requirement in section 28.2 of unsuccessful, the transmission provider customers should be allowed to the pro forma OATT to designate its will terminate the network customer’s ‘‘undesignate’’ portions of their network resources in the same manner request and change the status of the designated network resources on a as network customers and the request on OASIS to ‘‘retracted.’’ This short-term basis in order to make firm prohibition in section 30.1 of the pro termination will be without prejudice to sales from these resources. forma OATT against making firm sales the network customer submitting a new from its designated network resources. request that includes the required Comments That is, the transmission provider and attestation. The network customer will 420. Most commenters suggest that all network customers must designate be assigned a new priority consistent the Commission continue to allow their network resources and are with the date of the new request. network customers to undesignate a prohibited from making firm sales from 416. In the event that the transmission portion of their designated network designated network resources. To the provider or any network customer resources on a short-term basis in order extent the transmission provider or a designates a network resource that it to make firm sales.380 APPA argues that network customer wants to make a firm does not own or has not committed to the ability of network customers to sale from a network resource, it must purchase or that does not comport with undesignate their network resources on undesignate the resource pursuant to the requirements for designated network a short-term basis is an important aspect section 30.3 of the pro forma OATT. resources, we will deem the network of Order No. 888–B and should be The network customer, including the customer to be in violation of the pro preserved. APPA states that the transmission provider itself, can request to redesignate the resource by making a forma OATT and will consider flexibility afforded to network resource request to designate a new network assessing civil penalties on a case-by- customers allows them to lay off excess resource pursuant to section 30.2 of the case basis consistent with the power supplies that they do not need to Commission’s Enforcement Policy pro forma OATT. serve their designated loads during off- Statement. We encourage the 424. We seek comment on the amount peak demand periods. APPA and EEI transmission provider and other market of time prior to operation that the contend that this increases the number participants to use the Commission’s transmission provider and other of wholesale sellers in the market Enforcement Hotline to report instances network customers should be required during non-peak periods, and this when they believe a network customer to terminate a network resource to supports wholesale competition for has designated as a network resource a ensure that the appropriate set of power supply sales. resource that does not meet the criteria network resources are included in the 421. Several commenters suggest that for network resources. ATC calculation. network customers should have the c. Undesignation of Network Resources same right as transmission providers to 7. Clarifications Related to Network Service 417. Section 28.2 of the pro forma undesignate network resources to make 381 OATT requires the transmission off-system sales. APPA states that the Secondary Network Service Commission should make explicit the provider, on behalf of its native load 425. Section 28.4 of the pro forma requirement that the transmission customers, to designate resources and OATT allows a network customer to provider must provide the same loads in the same manner as any deliver economy energy purchases to its flexibility to its network customers as it network customer under Part III of the network load from non-designated does to its own merchant function in pro forma OATT (Network Integration network resources on an as-available designating and terminating network Transmission Service). The information basis without additional charge. In resources. provided by the transmission provider Order No. 888, the Commission 422. NRECA asserts that public utility must be consistent with the information described economy energy purchases as it uses to calculate ATC. Section 30.3 of transmission providers must be required energy that displaces firm network the pro forma OATT allows the network 382 379 resources. customer to terminate the designation of Order No. 888–B at 62,093 426. The use of secondary network 380 E.g., APPA, EEI, Entergy, Nevada Companies, all or part of a generating resource as a Public Power Council, Southern, and TVA. service to deliver purchased power network resource at any time, though 381 E.g., APPA, NRECA, and Public Power the network customer should provide Council. 382 Order No. 888 at 21,751.

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when a network customer is making off- system sale if the purchased power does system block energy because the system sales was raised in several not displace the customer’s own higher purchased energy is more economic Commission investigations and audits. cost generation. We propose to modify than using its network resources, but In Idaho Power, the Commission the section 28.4 of the pro forma OATT makes off-system sales during some accepted a settlement with Idaho Power to clarify that a network customer may hours when the block energy purchase related to Idaho Power’s incorrect use of use secondary network service to is scheduled. In other words, in the native load priority to access its deliver economy energy and we propose enforcing this policy, we will apply the transmission system.383 In Idaho Power, to add a definition for ‘‘economy definition of ‘‘economy energy’’ as it the utility’s wholesale merchant energy’’ to the pro forma OATT. We applies to the entire period covered by function purchased power outside of propose to define ‘‘economy energy’’ as the block purchase and not to a single Idaho Power’s control area to facilitate energy purchased by a network hour within the block. an off-system sale and used secondary customer that displaces the customer’s network service to bring the purchases own higher cost generation for the ‘‘[O]n an As-Available Basis’’ into Idaho Power’s control area.384 In purpose of serving the customer’s 432. Section 28.4 of the pro forma accepting the settlement, the designated network loads. OATT allows a network customer to use Commission stated that ‘‘[i]t is 429. While we reiterate that secondary secondary network service to deliver axiomatic that the native load priority network service may be used only to economy energy purchases to its cannot be used to complete sales that serve a network customer’s designated network load from non-designated are not necessary to serve native network load, we do not intend to resources ‘‘on an as-available basis.’’ load.’’ 385 In MidAmerican, the discourage market participants from However, the current pro forma OATT Commission issued an audit report that identifying opportunities to profitably does not specify how a network contained a finding that MidAmerican’s purchase for resale. We simply intend to customer must arrange for secondary wholesale merchant function used ensure that all market participants network service. network service instead of point-to- compete on a comparable basis and use Discussion point service to deliver short-term point-to-point service to complete all energy purchases to its control area that segments of a purchase for resale off- 433. We propose to modify section were not used to serve MidAmerican’s system. 28.4 of the pro forma OATT by native load.386 430. We also do not intend to clarifying that a network customer need discourage network customers from not file an application for network Comments purchasing off-system energy to lower service to receive secondary network 427. South Carolina E&G asks the the cost of serving network loads. A service, but that all other requirements Commission to clarify whether specific network customer may use secondary of Part III of the pro forma OATT methods used to bring sellers and network service in hours when it is also (except for transmission rates) apply to buyers together in the wholesale market making off-system sales. However, the secondary network service. In other are appropriate under the pro forma network customer may do so only to words, a network customer must request OATT in its current form. South deliver purchases that qualify as secondary network service on OASIS in Carolina E&G notes that as a utility’s economy energy purchases. In response a manner consistent with pro forma native load forecasts evolve into real- to South Carolina E&G’s observation OATT sections 18.1 and 18.2 time conditions, the utility may need to that a utility’s native load forecasts (Procedures for Arranging Non-Firm sell off excess energy. South Carolina evolve in real-time to the point that the Point-To-Point Transmission Service). E&G notes further that, as inexpensive utility may need to sell off excess energy sources of power become available off- that was purchased off-system, we note Redirect of Network Service system, the utility may engage in that our definition would allow a 434. The current pro forma OATT economy purchases of power for native network customer to use network does not include any provision to load. South Carolina E&G asserts that service to deliver off-system purchases change the point of receipt for an off- such practices clearly benefit the market when the network customer purchases system designated network resource, in and safeguard native load customers’ the energy with the intent to serve a manner similar to redirect of point-to- interests by ensuring that economy native load. point service. However, we are aware purchases minimize the price of 431. In enforcing this policy, we will that several transmission providers have consumers’ power and/or giving the apply the definition of ‘‘economy posted business practices that allow utility a market outlet for excess energy, energy’’ at the time the network network customers either to substitute thus avoiding the uneconomic backing customer commits to purchase energy. an off-system non-designated network down of lower cost generating units For instance, we will not take issue if a resource for a designated network while retaining higher cost network customer uses secondary resource or to redirect the point of prescheduled purchases. South Carolina network service to deliver an hour- receipt associated with an existing E&G urges the Commission to support ahead purchase that costs less than the network resource. the continuation of such practices. network customer’s generation cost in the hour of operation. Similarly, we will Discussion Discussion not question the use of secondary 435. We propose to clarify that 428. We propose to clarify that a network service by a network customer network customers may not redirect network customer may not use to deliver a day-ahead off-system network service in a manner comparable secondary network service to bring purchase that costs less than the to the way customers redirect point-to- energy onto its system to support an off- network customer’s forecast generation point service. Unlike point-to-point cost, even if real-time system conditions service that is based upon a contract- 383 Idaho Power Co., 103 FERC ¶ 61,182 at P 2 evolve so that the realized generation path model consisting of a designated (2003) (Idaho Power). cost is less than the cost of the point of receipt and point of delivery, 384 Id. at P 4. 385 Id. purchased energy. We also would not network service involves no identified 386 MidAmerican Energy Co., 112 FERC ¶ 61,346 take issue with a network customer that contract path and is therefore not a at P 6 (2005). uses network service to deliver off- directable service. Rather, network

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service provides for the integration of applicable OATT provisions. Ameren, curtailments, and that the information designated network resources and loads KCP&L, and PNM–TNMP state that they currently posted is adequate to meet using the entire transmission grid in a are not aware of any improper practices customers’ needs. Nevertheless, manner comparable to the transmission that would warrant reforms to the pro Southern also states that while those provider’s use of the transmission grid forma OATT. APPA does not advocate rules have been effective in achieving to serve its native load customers. When changes to the pro forma OATT their intended purpose, incremental a network customer wants to substitute regarding curtailment, stating that its additions to the information that is one designated network resource for members express more concerns about available through OASIS could assure another, it should terminate the the denial of service prior to and at the customers that they have all of the designation of the existing network time of scheduling than they do information they need to make prudent resource and designate a new network regarding curtailment of service once it decisions about transmission service resource. The network customer can has commenced. However, APPA also and that they are being treated in a fair, then request to redesignate its original notes that most of its members use firm equitable, and non-discriminatory way. network resource by making a request to service that is unlikely to be interrupted 441. Commenters appear divided on designate a new network resource. once it is scheduled. Public Power the issue of whether there should be Alternatively, a network customer could Council, Snohomish, MEAG and Salt penalties for improper curtailments. The use secondary network service when it River concur with APPA that OATT most common view, expressed by EEI wants to substitute a non-designated reforms are not needed for curtailments. and others, is that penalties for network resource for a designated 439. Transmission customers, improper curtailments should be network resource on an as-available particularly IPPs, generally have a assessed only if the Commission finds basis. different view, arguing that the reasons that the transmission provider imposed for curtailment are difficult to discern, the curtailment with the intent to treat 8. Transmission Curtailments and that information is often a customer in an unduly discriminatory 436. Section 1.7 of the pro forma insufficient to determine whether or preferential manner. Other OATT defines curtailment as ‘‘a curtailments have been performed commenters expressed a wide range of reduction in firm or non-firm correctly. Northwest IPPs state views. Alcoa states that improper transmission service in response to a curtailments frequently appear arbitrary. curtailments should be the subject of transmission capacity shortage as a Powerex argues that incomplete monetary penalties. Santa Clara result of system reliability conditions.’’ postings on many transmission systems contends that transmission providers Curtailment provisions for point-to- and the lack of transparency in should be fully liable for any damages point service are set forth in sections curtailment data could mask improper caused by improper curtailments. On 13.7 and 14.7 for firm and non-firm curtailment. Calpine states that it is the other hand, Southern argues that transmission services respectively and usually difficult to determine whether a curtailment is a reliability issue and it the curtailment provisions for network curtailment of service is truly justified would be unwise to subject service are contained in section 33. by system reliability factors because the transmission providers to after-the-fact Complaints regarding improper operational facts underlying the utility’s assessments of their curtailment curtailment of service by transmission curtailment decision are unknown. It decisions. KCP&L notes that the providers have been made in a variety argues that the criteria for utility responsibility for calling a TLR rests of proceedings and the Commission has curtailment decisions are not with the reliability coordinator, who standardized, making it difficult to found cases of improper curtailment in makes decisions based on the NERC determine the propriety of curtailment the past.387 standard, so that penalties for improper decisions, particularly when 437. In the NOI, the Commission curtailment activity should be a subject curtailment is internal to a single area asked whether there is evidence of for the ERO. improper curtailment practices by and not performed through the NERC public utility transmission providers or TLR process. Calpine recommends that Discussion customers that warrants reforms to the the terms and conditions for 442. The Commission reminds both pro forma OATT. If there is, we curtailments be standardized by the new transmission providers and customers requested that commenters provide reliability organizations created by that our regulations require posting of specific examples of such practices. We EPAct 2005, that such terms and transmission curtailment information on conditions be made a formal part of the also asked whether transmission OASIS. The OASIS regulations state: providers engaging in improper pro forma OATT and the OATTs of public, private and federal utilities, and When any transaction is curtailed or curtailments should be subject to interrupted, the Transmission Provider must monetary penalties or other remedies for that these be posted on the transmission provider’s OASIS. Calpine further post notice of the curtailment or interruption market manipulation. on the OASIS, and the Transmission Provider recommends that regional NERC must state on the OASIS the reason why the Comments organizations be requested to audit the transaction could not be continued or 438. EEI argues that there do not curtailment practices of all utilities that completed. appear to be many instances of are not members of an RTO/ISO. (ii) Information to support any such improper curtailments and many Constellation asserts that TLRs are a curtailment or interruption, including the utilities state that they are not aware of ‘‘blunt and inefficient mechanism’’ for operating status of the facilities involved in any improper curtailments by public curtailment and calls for a requirement the constraint or interruption, must be that transmission providers provide maintained and made available upon request, utility transmission providers. For to the curtailed or interrupted customer, the example, Southern states that redispatch options. 440. In reply to claims that vertically Commission’s Staff, and any other person curtailments are performed on a non- who requests it, for three years.388 discriminatory basis, in accordance with integrated utilities provide inadequate information on curtailments, Southern 388 We note that we are proposing to change this 387 See, e.g., Consolidated Edison Co. of N.Y. v. states that existing OASIS requirements information retention period to five years, Public Serv. Elec. & Gen. Co., 108 FERC ¶ 61,120 already require utilities to post a consistent with our other proposed changes to the (2004). considerable amount of information on OASIS information retention provisions.

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(iii) Any offer to adjust the operation of the 9. Standardization of Rules and under the Commission’s ‘‘rule of Transmission Provider’s system to restore a Practices reason,’’ must be filed under FPA 393 curtailed or interrupted transaction must be 445. In Order No. 888, the section 205. posted and made available to all curtailed Commission required each public utility 447. In the NOI, the Commission and interrupted Transmission Customers at that owns, controls, or operates facilities asked: (1) Whether all rules, standards the same time.389 used for transmitting electric energy in and practices should be required to be included in public utilities’ OATTs? (2) 443. Those commenting that they interstate commerce to file, pursuant section 205 of the FPA, a pro forma If not all, which of such rules, standards have inadequate information about and practices should be included in curtailments do not clearly state OATT under which it would provide open access transmission services. public utilities’ OATTs? and (3) Should whether the source of this deficiency rules, standards and practices not lies in: (1) The inadequacy of our However, certain rules, standards and practices governing the provision of required to be included in public standards, (2) inadequate compliance utilities’ OATTs be required to be with these standards, (3) difficulties in such transmission service (e.g., public utility business practices) are not posted on OASIS to increase dealing with the way the information is transparency? provided, or (4) some other area. We are, reflected in the pro forma OATT. Only however, mindful that objective review when a public utility adopts a rule, Included in Open Access Transmission standard or practice that significantly of curtailments can require a Tariffs affects its rates and services has the considerable amount of information, 448. Some commenters argue that the Commission required it to make a filing some of which may not be provided rules, standards and practices governing pursuant to FPA section 205 to amend under the present OASIS regulations, or the provision of transmission service its OATT.390 The Commission has may be provided in an inefficient should be included in public utilities’ applied this policy using a ‘‘rule of 394 manner. For example, we recognize that 391 OATTs. Occidental states that the reason’’ test. inclusion of rules, standards and it is difficult for a customer to determine 446. The rule of reason test has arisen practices governing the provision of what network resources were available primarily with respect to protocols or transmission service in public utilities’ to the transmission provider that could operating procedures used by RTOs and OATTs will add much needed clarity as have been redispatched consistent with ISOs. For example, the Commission has to how transmission service is provided. pro forma OATT sections 30.5 and 33.2 held that while the business practices EPSA states that while it may not be to relieve the transmission constraint manuals of the Midwest ISO implicate necessary, or desirable, to require all that led to a transmission curtailment. the Commission’s jurisdiction because business practices to be incorporated Another example may be discerning they generally involve ‘‘the installation, into the OATT, there have been which discrete transaction(s) could be operation, or use of facilities for the instances where transmission providers curtailed on a non-discriminatory basis transmission or delivery of power * * * have adopted business practices that are to effectively relieve the constraint in interstate commerce,’’ they do not inconsistent with their OATT consistent with pro forma OATT section require a FPA section 205 filing because requirements or that should have been 13.6. We seek comment on whether ‘‘they mostly involve general operating filed as OATT amendments. Some additional requirements would improve procedures.’’392 In other cases, the facts commenters also support the inclusion the transparency of transmission have required the filing of the rule, curtailment information and the ability of the NAESB standards in the standard or practice. For example, 395 of customers to make use of that CAISO proposed to post certain, OATT. 449. In contrast, some commenters information. technical, operational and business oppose including rules, standards and standards related to dynamic scheduling 444. With respect to the imposition of practices in the OATT.396 EEI argues on its Web site and include only the penalties, the Commission recognizes that rules, standards and practices rates under its OATT. There, the that the transmission curtailment should not be included as part of an Commission found that the details decision is a reliability decision that OATT unless they significantly affect contained in the standards are practices should be based on applicable reliability rates and service under the OATT. EEI standards. Moreover, we note that the that may affect the terms and conditions of service significantly, and therefore, states that this is consistent with the need for transmission curtailment Commission’s current practice for the depends on many factors outside the inclusion of manuals in an OATT. control of an individual transmission 390 E.g., Cleveland v. FERC, 773 F.2d 1368, 1376 (D.C. Cir. 1985). Indicated New York Transmission provider, including loop flows 391 See, e.g., Public Serv. Comm’n of N.Y. v. Owners state that the inclusion of rules, throughout an interconnection. FERC, 813 F.2d 448, 454 (D.C. Cir. 1987) (holding standards and practices in the OATT is Accordingly, we will not propose that the Commission properly excused utilities from filing policies or practices that dealt only with generic penalties for improper 393 matters of ‘‘practical insignificance’’ to serving California Independent System Operator transmission curtailments in this customers); Midwest Independent Transmission Corp., 107 FERC ¶ 61,329 at P 21–22 (2004); see rulemaking. However, the absence of System Operator, Inc., 98 FERC ¶ 61,137 at 61,401 also Southwest Power Pool, Inc., 112 FERC ¶ 61,303 (‘‘It appears that the proposed Operating Protocols at P 25 (2005) (requiring that the SPP OATT provide generic penalties should not be sufficient information for market participants to construed to mean that we will tolerate could significantly affect certain rates and service and as such are required to be filed pursuant to fully understand SPP’s implementation of an intentional behavior that subjects Section 205.’’), order granting clarification, 100 imbalance market), reh’g dismissed, 113 FERC customers to unduly discriminatory or FERC ¶ 61,262 (2002). ¶ 61,115 (2005); PJM Interconnection, L.L.C., 104 392 Midwest Independent Transmission System FERC ¶ 61,124 at P 61 (requiring PJM to place all preferential actions. We remain vigilant procedures, standards and requirements for in monitoring for intentionally Operator, Inc., 108 FERC ¶ 61,163 at P 656, 658, order on reh’g, 109 FERC ¶ 61,157 (2004), order on proposing that a transmission owner construct a discriminatory provision of reh’g, 111 FERC ¶ 61,043, order on reh’g, 112 FERC specific upgrade, and all procedures for charging transmission service, and stand ready to ¶ 61,086 (2005); see also PJM Interconnection, customers, in its tariff, not in its manuals), order on use our enforcement powers and L.L.C., 81 FERC ¶ 61,257 at 62,267 (1997) (finding reh’g, PJM Interconnection, L.L.C., 105 FERC no reason to require filing of the PJM Manuals but ¶ 61,123 (2003). penalty authority when needed. 394 requiring that such manuals be available for public E.g., Occidental, TAPS, and Williams. inspection on a permanent basis), order on reh’g, 92 395 E.g., Salt River and Snohomish. 389 18 CFR 37.6(d)(3) (2005). FERC ¶ 61,282 (2000). 396 E.g., BPA, EEI, MidAmerican, and Southern.

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unnecessary and would transmission providers to post on ‘‘reasonable credit review procedures’’ administratively encumber any future OASIS all of their rules, standards and in accordance with ‘‘standard revisions to the practices and rules by practices that relate to transmission commercial practices,’’ to determine the requiring conforming tariff filings. services. We believe this proposal will ability of transmission customers to provide greater transparency and meet service obligations. Furthermore, Posted on OASIS mitigate the potential for undue to protect transmission providers from 450. Several commenters believe it discrimination against customers taking the risk of non-payment, the provision would be appropriate to post rules, transmission service under the authorizes the transmission provider to standards and practices on public transmission provider’s OATT.401 require as security a letter of credit or utilities’ OASIS sites.397 For example, However, we seek comment on how to other forms of security consistent with EEI states that it would be appropriate determine what ‘‘relates’’ to the Uniform Commercial Code. In the to post all rules, standards and practices transmission service to facilitate a Creditworthiness Policy Statement, the that are not part of the OATT on a consistent interpretation and to Commission explained that non-RTO or transmission provider’s OASIS. APPA minimize discretion on what rules, -ISO transmission providers generally asserts that, in particular, transmission practices and standards should be have not incorporated creditworthiness 402 providers should post the posted on OASIS. or security requirements into their methodologies they use to develop ATC 453. Commenters presented wide OATTs.405 The Commission stressed and ATC calculations should be ranging positions on the issue of what that transparency of credit procedures periodically verified by an independent rules, standards and practices to include and security requirements can enhance 398 third party. in the OATT. We do not propose to market certainty and liquidity by 451. Other commenters contend that modify our existing policy on this issue allowing customers to determine for at this time.403 We agree with EPSA’s rules, standards and practices should be themselves the information they need to concern that requiring transmission posted on public utilities’ OASIS sites demonstrate creditworthiness and the providers to include all of their rules, only when they are not required to be amount and type of security they need 399 standards and practices in their OATTs filed. TAPS argues that any rules, to receive transmission service. In could decrease a transmission standards and practices not required to interpreting the ‘‘reasonable credit provider’s flexibility to change be filed must be publicly posted on the review procedures’’ requirement in businesses practices and respond to the transmission provider’s OASIS to section 11 of the pro forma OATT, the requests of customers. Additionally, we provide needed transparency, because Commission stated that it expected believe that requiring transmission including essential terms in business transmission providers to post on their providers to file all of their rules, practices that are not posted makes it OASIS sites the process and very difficult for customers to standards and practices in their OATTs would be impractical and potentially methodologies used to evaluate a understand if they are being treated potential customer’s creditworthiness fairly by the transmission provider. TDU administratively burdensome.404 and calculate the necessary security.406 Systems asserts that requiring posting 454. We propose to require, however, But it also stated that it would ‘‘consider on transmission providers’ OASIS sites that creditworthiness and security standardizing credit procedures through of any standards and practices not requirements be included in a a generic rulemaking if necessary to included in their OATTs would transmission provider’s OATT. The prevent undue discrimination.’’ 407 facilitate transactions across several creditworthiness provision in section 11 transmission provider systems, of the pro forma OATT authorizes 455. Our preliminary conclusion is especially where transmission providers transmission providers to require that a transmission provider’s OATT are not participating in RTOs or ISOs.400 should contain sufficient information Williams goes one step further and 401 We clarify that posting rules, practices and about its credit process and standards on the transmission provider’s OASIS— requirements to enable customers to recommends that the Commission in lieu of filing such practices with the Commission require that transmission providers both as part of the transmission provider’s pro forma understand the information required to file with the Commission and post on OATT—neither insulates a transmission provider demonstrate creditworthiness and to their OASIS sites, all policies, practices from complaints nor confers a just and reasonable determine for themselves the general presumption. We encourage customers to call the amount and type of security they may and interpretations used or relied upon Commission’s Enforcement Hotline with to evaluate a request for transmission complaints about the application of such rules, need to provide in order to receive service. standards and practices should they experience service. We therefore propose to amend problems with their transmission providers. To the section 11 of the pro forma OATT on Discussion extent customers are not satisfied with responses from utilities, they should contact the creditworthiness to require each 452. There appears to be broad Commission’s Enforcement Hotline via telephone transmission provider to include its consensus among the commenters that (202) 502–8390, toll-free 1–888–889–8030, fax (202) creditworthiness and security rules, standards and practices not 208–0057, or at www.ferc.gov/cust-protect/enforce- requirements in a new Attachment L to required to be included in a hot.asp. its OATT. 402 We note that certain rules and practices are transmission provider’s pro forma already required to be posted on OASIS. See, e.g., OATT should be posted on the Order No. 889; Open Access Same-Time 405 Policy Statement on Electric Creditworthiness, transmission provider’s OASIS. We Information Systems, Order No. 605, 64 FR 34117 109 FERC ¶ 61,186 at P 9 (2004) (Creditworthiness agree and propose to require (Jun. 25, 1999), FERC Stats. and Regs. ¶ 31,075 Policy Statement). (1999); Order No. 676. 406 Id. at P 12. The Commission explained that all 403 See supra notes 391–393 and accompanying transmission providers (including RTOs and ISO) 397 E.g., APPA, BPA, EEI, EPSA, MidAmerican, text. were expected to ‘‘(1) make their credit-related and Southern. 404 Of course, we will require the filing of certain practices more transparent and comprehensive; (2) 398 See supra Part V.A addressing posting rules, standards and practices when circumstances post on their [OASIS sites] the procedures that they requirements for ATC calculation. require. In Order No. 676, the Commission, among use to do their credit analyses; and (3) provide a 399 E.g., Progress Energy and TAPS. other things, incorporated certain business customer with a written analysis setting forth how 400 Suez Energy NA emphasizes that the posting standards developed by NAESB by reference into that entity applied its credit standards to that of rules, standards, and practices on OASIS merely the Commission’s regulations and required public customer, if that customer is required to provide ensures that they are transparent, it does not ensure utilities to file revisions to their OATTs to include security.’’ Id. that they are non-discriminatory. these standards. Order No. 676 at P 20. 407 Id. at P 15.

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456. In the Creditworthiness Policy whether this definition should be Statement) 411—that transmission Statement, the Commission explained incorporated in the pro forma OATT. provider obligations under the pro that, to assess an applicant’s credit risk, 459. Though MidAmerican urges the forma OATT are subject to an overriding transmission providers should use both Commission to incorporate the ‘‘Good Utility Practice’’ requirement qualitative factors, such as the local definition of ‘‘reliable operation’’ into that includes compliance with NERC regulatory environment or the the pro forma OATT, other commenters reliability standards or more stringent applicant’s history and financial argue that the definition of reliable regional reliability council standards. policies, and quantitative factors, such operation should not be included in the Discussion as information included on the pro forma OATT.410 Southern argues 408 462. We propose to require applicant’s financial statements. We that the definition of reliable operation propose to require the new Attachment transmission-owning public utilities to included in section 215 of the FPA L to include such quantitative and modify the definition of Good Utility would impose a higher standard on qualitative criteria to determine the Practice in their respective OATTs to transmission providers than is currently level of secured and unsecured credit. reference the reliable operation required by well-established NERC We also propose to require the new definition adopted in section 215 of the standards. Southern and EEI assert that Attachment L to include the following FPA. We propose to take this action for the system is not planned to be able to elements: (1) A summary of the two reasons. First, the Commission guarantee that operations will not be procedure for determining the level of indicated in the Reliability Policy impaired under any conditions. secured and unsecured credit; (2) a list Statement that it expects public utilities Southern argues that transmission of the acceptable types of collateral/ operating transmission facilities under security; (3) a procedure for providing providers should not be held to a higher the pro forma OATT to conform to customers with reasonable notice of standard of having to ensure that the prevailing reliability standards. The changes in credit levels and collateral system can continue to be operated even Commission finds that referencing the requirements; (4) a procedure for if a ‘‘sudden disturbance, including a reliable operation definition in section providing customers, upon request, a cybersecurity incident or unanticipated 215 of the FPA satisfies our requirement written explanation for any change in failure of system elements’’ occurs. that transmission providers provide safe credit levels or collateral requirements; 460. Along with Southern, EEI and reliable transmission service to (5) a reasonable opportunity to contest contends that the ERO should establish customers taking service under the pro determinations of credit levels or standards related to reliable operation. forma OATT. Second, we are mindful of collateral requirements; and (6) a EEI states that section 215 of the FPA the obligation placed on ‘‘all users, reasonable opportunity to post simply gives the Commission owners and operators of the bulk power additional collateral, including curing jurisdiction over reliability standards, system’’ under section 215(b) of the FPA any non-creditworthy determination. which are defined as standards for the to ‘‘comply with reliability standards’’ We propose to allow these basic reliable operation of the transmission that will take effect under this section. elements to be supplemented with a system; it does not require transmission Those reliability standards must credit guide or manual to be posted on providers to meet a ‘‘reliable operation’’ ‘‘provide for reliable operation of the OASIS. standard. This is an important bulk-power system.’’ 412 When the ERO 457. Though we are proposing to distinction, EEI continues, because is certified by the Commission and we require transmission providers to while a transmission provider may approve its reliability standards, those incorporate the creditworthiness and adopt reasonable reliability standards, standards will be based on the same security methodologies into their that does not guarantee that it will in all definition of reliable operation we OATTs, we recognize that there is a instances meet a ‘‘reliable operation’’ propose to incorporate into the pro balance here between the burden on the requirement, which would require the forma OATT. We agree with EEI and transmission provider of adding these transmission provider to in all instances Southern that the ERO is best suited to methodologies to its OATT and the need prevent instability, uncontrolled develop reliability standards for the for Commission review and approval if separation or cascading failures despite Commission’s approval, but our methodologies frequently change. We sudden disturbances, cybersecurity proposal to incorporate the definition of seek comment on whether the proposal incidents, or unanticipated failures of reliable operation does not establish a is unduly burdensome. system elements. EEI and Southern reliability standard; rather, we believe it reflects Congress’s benchmark for 10. OATT Definitions contend that because the ERO will implement the directives of Congress acceptable utility practice. It therefore 458. In the NOI, the Commission contained in section 215, the ERO will belongs in our definition of Good Utility requested comment on whether new or be best suited to establish the reliability Practice in the pro forma OATT. amended pro forma OATT definitions standards that incorporate principles of 463. In addition to amending the were necessary. The Commission also definition of Good Utility Practice, we reliable operation. noted that new section 215(a)(4) of the propose to add a definition for ‘‘non- FPA, which was adopted as part of 461. TAPS suggests that what is more firm sales’’ to clarify section 30.4 of the EPAct 2005, defines the term ‘‘reliable important than adding a ‘‘reliable pro forma OATT. A number of operation.’’ 409 We therefore asked operation’’ definition is making explicit transmission providers have modified in the tariff what the Commission stated section 30.4 of the OATT to state that 408 Id. at P 13 & nn.13–14. An evaluation using in its Policy Statement on Matters ‘‘The Network Customer shall not both sets of factors would allow an applicant Related to Bulk Power System operate its designated Network without a credit rating or a strong balance sheet, but Reliability (Reliability Policy with solid credit, to meet the creditworthiness Resources located in the Network criteria. Id. at P 14. 409 EPAct 2005 sec. 1211(a) (to be codified at FPA separation, or cascading failures of such system will 411 Policy Statement on Matters Related to Bulk section 215(a), 16 U.S.C. 824o). Section 215(a)(4) not occur as a result of a sudden disturbance, Power System Reliability, 107 FERC ¶ 61,052 at P defines ‘‘reliable operation’’ as ‘‘operating the including a cybersecurity incident, or unanticipated 23, clarified, 108 FERC ¶ 61,288 (2004); Supplement elements of the bulk power system within failure of system elements.’’ to Policy Statement on Matters Related to Bulk equipment and electric system thermal, voltage, and 410 E.g., EEI, Powerex, Snohomish, Southern, Power System Reliability, 110 FERC ¶ 61,096 (2005). stability limits so that instability, uncontrolled Suez Energy NA, and TAPS. 412 Section 215(a)(3) of the FPA.

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Customer’s or Transmission Provider’s standards that currently exist. TAPS investigations or audits are afforded Control Area such that the output of asserts that, while customer complaints their full due process rights, should be those facilities exceeds its designated are an indication that something is adequate to ensure compliance with Network Load, plus non-firm sales awry, the lack of transparency makes it OATT provisions. delivered pursuant to Part II of the very hard for customers to detect 469. A number of commenters also Tariff, plus losses’’ (emphasis added). discrimination and tariff violations on indicate that the Commission should We propose to define ‘‘non-firm sales’’ the part of the transmission provider. require third party audits for frequent as ‘‘an energy sale for which delivery or TAPS suggests that customers often abusers. EEI suggests that a transmission receipt of the energy may be interrupted conclude that a complaint process is not provider that is found to have a for any reason or for no reason, without cost effective because even if they systematic or continuing violation of the liability on the part of either the buyer ultimately prevail, they will have lost OATT could be required to hire an or seller.’’ This is the definition of non- out on the purchase opportunity that independent reviewer to monitor its firm sales used in a number of industry- prompted the complaint. future compliance for a period of time standard master power sales Discussion after the violation occurred. TVA agreements, including the EEI Master suggests that, if a particular Purchase and Sale Agreement. We 466. The Commission intends to transmission provider repeatedly propose to clarify that, for the purposes maintain a strong audit program to misapplies its OATT, the Commission of applying section 30.4 of the pro determine whether transmission should at that point consider requiring forma OATT, energy sales that can only providers and transmission customers that transmission provider to hire an be interrupted to maintain system are in compliance with the new pro independent monitor for a defined reliability will be considered firm sales. forma OATT. This audit program will period of time as a remedy for those 464. We also propose to add two new include operational audits similar to the actual infractions. NRECA argues that definitions that are required to OATT compliance components of audits those transmission providers who are implement our proposed reforms. For conducted by Commission staff in the consistently in violation or who do not example, we propose a definition of past. cure audit findings in a timely manner ‘‘affiliate’’ in section 1.1 of the revised 467. These audits will determine pro forma OATT incident to our compliance with specific provisions of should see both an increase in proposed change to the pricing of the OATT. Staff’s findings and frequency and further scrutiny from the reassigned capacity. We also propose a recommendations will be detailed in audit process. new definition of ‘‘pre-confirmed public audit reports issued in Discussion application’’ in section 1.40 of the accordance with the Commission’s revised pro forma OATT incident to our authority. If an audit is contested, it will 470. We propose to have Commission proposal to give priority to requests that be disposed of consistent with the staff conduct audits of compliance with are pre-confirmed. Commission’s final rule on disposition the new OATT. Commission staff is in of contested operational audits. The a unique position to conduct OATT E. Enforcement Commission staff’s compliance audits compliance audits and recommend 1. General Policy historically have included the collection remedial action consistent with of information regarding the audit previous audits. In addition, entities a. Compliance Review Regime target’s overall operations. In this vein, audited by Commission staff now have Comments the Commission staff’s OATT clear and assured due process rights as 465. A number of commenters compliance audits may also collect the result of Order No. 675. indicate that a strong program to audit information regarding implementation 471. We may require third party compliance with the pro forma OATT is of a transmission provider’s OATT, with audits as part of an individual crucial to preventing undue the intent that Commission staff may compliance plan we order an audited discrimination in the provision of share the information it gathers with the party to undertake when we issue the transmission service. APPA argues that Commission subject to all applicable ex Commission staff’s audit report. The the Commission should establish a parte rules. Commission staff monitors compliance regime of systematic tariff compliance b. Use of Independent Third Party with all of its audit recommendations as reviews because the OATT is at bottom Audits part of its regular practice. We may, in a behavioral remedy rather than a selected cases, decide to enhance this structural one, so active Commission Comments regular monitoring by requiring an oversight is necessary. In addition, 468. A number of commenters audited party to hire an independent APPA notes that OATT transmission indicate that the Commission should reviewer to continue compliance audits customers (especially network not rely on third party audits as the after the Commission staff’s audit has customers that are dependent upon the primary means of ensuring compliance ended. We could take such action in transmission systems of their with the OATT. APPA states that if an response to a number of circumstances, neighboring public utility OATT OATT Transmission Provider retains including, but not limited to, transmission providers) are often and pays an ‘‘independent reviewer’’ to identification of systematic OATT reluctant to open the ‘‘can of worms’’ prepare compliance audit reports, violations, violations that require on- that filing a section 206 complaint someone will inevitably question the going monitoring, or a pattern of against their transmission providers reviewer’s independence. Therefore, repeated OATT violations. Under these entails. Powerex urges the Commission APPA argues that it might be better for circumstances, the audited party should to establish systematic tariff compliance the Commission itself to prepare the bear the burden of on-going compliance audits as a monitoring tool because reports, or to retain a consultant to do monitoring. If we decide to order remedies and penalties alone are so. Southern suggests that the independent OATT compliance audits structurally ill-suited to address the Commission’s existing mechanisms, as part of an individual audited party’s myriad of idiosyncratic deviations from coupled with new rules that will ensure compliance plan, we will specify the the Commission’s policies and that all regulated entities subject to scope and duration of the audits.

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2. Civil Penalties regulations, under which it is ‘‘unlawful fair manner. For example, the a. Background for any entity, directly or indirectly, in Commission elsewhere is proposing that connection with the purchase or sale of transmission providers as well as 472. The NOI observed that the electric energy or the purchase or sale transmission customers be subject to existing OATT allows transmission of transmission services subject to the specified operational penalties for providers to impose certain operational jurisdiction of the Commission, (1) to violations of certain OATT provisions. penalties on customers for tariff use or employ any device, scheme, or However, aside from these operational violations, but does not address the artifice to defraud, (2) to make any penalties, the Commission does not adverse consequences to a transmission untrue statement of a material fact or to intend to provide a schedule of provider who violates its OATT. It also omit to state a material fact necessary in enforcement remedies and sanctions in summarized the broad variety of order to make the statements made, in the OATT. Instead, the Commission remedies and sanctions available for the light of the circumstances under prefers to examine violations and enforcement of its rules and regulations, which they were made, not misleading, determine the appropriate response for including the enhanced civil penalty or (3) to engage in any act, practice, or a violation on a case-by-case basis. The authority provided by EPAct 2005.413 course of business that operates or Commission has a broad array of 473. In the NOI, the Commission would operate as a fraud or deceit upon equitable remedies and sanctions for asked for comments on whether we any entity.’’ 419 The Anti-manipulation violations.426 Our enhanced civil should address the issue of remedies or Rule made it unnecessary to retain penalties, as provided by EPAct 2005, penalties against transmission providers Market Behavior Rules 2 or 6. are among the available sanctions for as part of OATT reform. It also asked if Accordingly, on February 16, 2006, the violations of the Commission’s statutes, transmission providers should be Commission rescinded Market Behavior rules, regulations and orders, including subject to revocation of their market- Rules 2 and 6 and codified the instances of undue discrimination and based rate authority for certain OATT substance of Market Behavior Rules 1, 3, market manipulation. violations, and if certain violatins 4, and 5 in the Commission’s 477. Although we will look at should be considered market regulations.420 violations on a case-by-case basis and manipulation under the Market not identify in this proposed rule 414 b. Whether Civil Penalties Should Be Behavior Rules and section 1283 of Specified in the OATT specific penalties for different EPAct 2005.415 violations, the Enforcement Policy 474. Subsequent to the NOI, on Comments Statement provides guidance and October 20, 2005 the Commission 475. Commenters often did not regulatory certainty regarding issued its Enforcement Policy distinguish between operational enforcement and places entities subject Statement, which discusses the factors penalties and civil penalties in their to our jurisdiction on notice of the the Commission will take into account comments about the need for additional consequences of violations.427 As we in determining remedies and sanctions penalties in the OATT. EEI and noted, ‘‘[I]t is important that we retain for violations, including civil MidAmerican made the distinction, the discretion and flexibility to address penalties.416 Also, in EPAct 2005, asserting that civil penalties should not each case on its merits, and to fashion Congress provided the Commission with be specified in the OATT. They and remedies appropriate to the facts specific anti-manipulation authority.417 others contend that: enforcement presented, including any mitigating On January 19, 2006, to implement this actions, including civil penalties, factors.’’ 428 new authority, the Commission issued should be reviewed on a case-by-case 478. As the facts of a specific matter Order No. 670 (Anti-manipulation basis; 421 civil penalties should be based warrant, we will seek disgorgement of Rule),418 adopting a new Part 1c of its upon the seriousness of the violation; 422 unjust profits that are the result of a penalties should require proof of intent violation. Violators should not retain 413 EPAct 2005 expanded the Commission’s civil or willfulness; 423 penalties should only the gains acquired as the result of the penalty authority under the FPA to encompass apply for repeated violations; 424 and, violation. OATT violators will be violations of all provisions of FPA Part II (EPAct 2005 section 1284(e)(1) (to be codified at section penalty procedures should provide for expected to disgorge unjust profits 316A of the FPA, 16 U.S.C. 825o–1)), and due process.425 whenever they can be determined or established the maximum civil penalty the reasonably estimated.429 In addition, as Discussion Commission can assess under FPA Part II as $1 warranted by the facts, civil penalties million per day per violation (EPAct 2005 section 476. The Commission intends to 1284(e)(2) (to be codified at section 316A of the may also be assessed. Those penalties FPA, 16 U.S.C. 825o–1)). enforce OATT provisions in a firm but (up to $1 million per day per violation), 414 Investigation of Terms and Conditions of however, can be mitigated by the factors Public Utility Market-Based Rate Authorizations, Stats. & Regs. ¶ 31,202, reh’g denied, 114 FERC set forth in the Enforcement Policy 105 FERC ¶ 61,218 (2003), order on reh’g, 107 FERC ¶ 61,300 (2006). Statement, such as self-reporting, ¶ 61,175 (2004). 419 Id., 71 FR 4244, 4258 (Jan. 26, 2006) (to be 415 NOI at P 15. codified at 18 CFR 1c.2(a)). compliance programs, and cooperation 416 Enforcement of Statutes, Order, Rules and 420 Investigation of Terms and Conditions of Regulations, Policy Statement on Enforcement, 113 Public Utility Market-Based Rate Authorizations, 426 Enforcement Policy Statement at P 4. The FERC ¶ 61,068 at P 17–20 (2005) (Enforcement 114 FERC ¶ 61,165 (2005). The primary purpose of ‘‘enhanced civil penalty authority will operate in Policy Statement). the Market Behavior Rules was to prohibit market tandem with our existing authority to require 417 EPAct 2005 sec. 1283 (to be codified at section manipulation by public utility sellers acting under disgorgement of unjust profits obtained through 222 of the FPA, 16 U.S.C. 824v). Congress market-based rate authority. misconduct and/or to condition, suspend, or revoke prohibited the use or employment of ‘‘any 421 E.g., Entergy, Santa Clara, Steel Manufacturers certificate authority or other authorizations, such as manipulative or deceptive device or contrivance’’ in Association, WAPA, and Williams. market-based rate authority for sellers of electric connection with the purchase or sale of electric 422 Steel Manufacturers Association. energy.’’ Id. at P 12. energy or transmission services subject to the 423 E.g., EEI, KCP&L, Progress Energy, Public 427 Id. at P 1. jurisdiction of the Commission. Congress directed Power Council, Southern, and Xcel. 428 Id. at P 13. Several commenters supported the the Commission to give these terms the same 424 E.g., Alberta Intervenors, Public Power application of the Enforcement Policy Statement to meaning as under the Securities Exchange Act of Council, Snohomish, Suez Energy NA, and TDU OATT violations. E.g., APPA, EEI, Midwest SATs, 1934, 15 U.S.C. 78j(b) (2000). Systems. National Grid, and TAPS. 418 Prohibition of Energy Market Manipulation, 425 E.g., Bonneville, EEI, Southern, and Nevada 429 Enforcement Policy Statement at P 19 and P Order No. 670, 71 FR 4244 (Jan. 26, 2006), FERC Companies. 23.

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with staff from the Commission’s Office revocation of market-based rate manipulation. Some commenters prefer of Enforcement.430 authority. Progress Energy states that the to have the Commission approach these Commission should not penalize the matters on case-by-case basis.438 c. Whether Transmission Providers utility’s merchant function for 484. Some commenters, like Should Be Subject to Revocation of violations of the OATT caused by the Constellation, identify OATT violations Their Market-Based Rates for OATT utility’s transmission function. Ameren that may constitute market Violations. and Southern would add a ‘‘willful’’ or manipulation. Ameren, EEI, and Comments ‘‘intent’’ requirement to revoking Occidental argue that intentionally 479. In the NOI, the Commission also market-based rates for an OATT setting aside more transmission capacity asked if transmission providers should violation. than is needed to serve native load could constitute market manipulation. be subject to revocation of their market- Discussion based rate authority for certain OATT LG&E states that the key factor is violations.431 Some commenters agree 481. As discussed in the Enforcement ‘‘intent.’’ LG&E provides an example in that revocation of market-based rates Policy Statement, the better approach is which ATC becomes available as a could be an appropriate remedy.432 to look at all of the facts and result of less-than-expected native load circumstances of each violation before EPSA asserts that revocation of market- requirements, and not because the deciding on any remedy or sanction.435 based rate authority should be among transmission owner intentionally There may be OATT violations in the penalties the Commission could overstated native load requirements, circumstances that, after applying the impose for serious violations of the and the transmission owner’s affiliate factors in the Enforcement Policy OATT, such as when more transmission followed proper reservation and Statement, merit revocation or capacity is set aside than is actually scheduling protocol in a manner limitation of market-based rate needed to serve native load, or undue applicable to all potential transmission authority. However, before the preferences are extended to native load customers. Under these circumstances, Commission will consider revoking an or affiliate transactions. TAPS states that LG&E contends, the Commission’s entity’s market-based rate authority for where lack of ATC forecloses network imposition of a civil penalty would be a violation of the OATT, there must be customer access to alternatives, a inappropriate given the absence of a nexus between the specific facts intent to impart false or misleading transmission provider should not be relating to the OATT violation and the able to make sales of electric power at information into the marketplace or entity’s market-based rate authority. The hoard transmission. market-based rates and should be Commission proposes that if it required to offer embedded-cost-based 485. Occidental suggests that determines, as a result of a significant curtailments of firm transmission sales. APPA asserts that whether a OATT violation, that the market-based transmission provider’s violation of the service designed to permit wholesale rate authority of a transmission provider power sales by the merchant function of OATT merits possible revocation of its will be revoked within a particular market-based rate authority depends on the transmission provider or an affiliate market, each affiliate of the transmission should also be considered market the nature and severity of the violation. provider that possesses market-based APPA argues that if the violation manipulation. Suez Energy NA argues rate authority will have it revoked in that incidents of affiliate abuse by a concerns practices that favor the that market on the effective date of transmission provider’s own wholesale transmission provider may be revocation of the transmission considered market manipulation merchant function at the expense of its provider’s market-based rate authority. third-party competitors, and if that pursuant to section 1283 of EPAct 2005. violation is willful or repeated, then d. Whether Certain OATT Violations TAPS states that certain withholding of revocation or conditioning of the Should Be Considered Market transmission capacity can rise to the market-based rate authority of the Manipulation Under the Market level of a violation of the Commission’s transmission provider’s merchant Behavior Rules and Section 1283 of market behavior rules and its new anti- function may be warranted.433 EPAct 2005. manipulation authority if the withholding reduces the supply of both 480. Other commenters argue that Comments revocation of market-based rate transmission and generation in a 482. In the NOI, the Commission authority should be reserved for market market, which artificially raises prices. asked if specific OATT violations behavior violations, not OATT should be considered market Discussion violations.434 EEI and MidAmerican manipulation under the Market 486. As explained above, we now are argue that the Commission has Behavior Rules and section 1283 of examining market manipulation in the separated public utilities’ transmission EPAct 2005.436 The Commission then context of Part 1c of our regulations. We functions from their marketing suggested that one such type of do not propose to identify in the OATT functions and, thus, penalties for violation might be when a transmission specific conduct as per se market violation of the OATT should be kept provider sets aside more transmission manipulation. As noted in Order No. separate from penalties imposed for capacity than is needed to serve native 670, market manipulation is a fact- market behavior violations. PacifiCorp load, but uses the capacity for third- intensive determination.439 We do not contends that the Commission’s new party sales.437 want to restrict our fact-finding to penalty authority is sufficient to ensure 483. None of the commenters want specific types of violations. Although compliance with the OATT and that specific violations identified in the certain fraudulent or deceptive practices there no longer is a need to consider OATT to be deemed per se market concerning the OATT could qualify as market manipulation under Order No. 430 Id. at P 6 and P 21–27. 435 Enforcement Policy Statement at P 18. Among 670, the Commission declines to 431 NOI at P 15. the factors examined are ‘‘willfulness’’ and ‘‘intent’’ 432 E.g., Arkansas Cities, NRECA, Occidental, of the violator. Id. at P 20. address such circumstances generically Snohomish, and Williams. 436 NOI at P 15. Section 1283 of EPAct 2005 433 APPA at 32. establishes section 222 of the FPA (to be codified 438 E.g., APPA, Entergy, Nevada Companies, 434 E.g., EEI, MidAmerican, PacifiCorp, PNM– at 16 U.S.C. 824v). Public Power Council, and Southern. TNMP, and Progress Energy. 437 NOI at P 15. 439 Anti-manipulation Rule at P 72.

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in this rulemaking and instead will review under section 3507(d) of the clarity of the information to be consider them on a case-by-case basis, if Paperwork Reduction Act of 1995.440 collected, and any suggested methods and when they arise, under the OMB’s regulations require OMB to for minimizing respondents’ burden, standards set forth in Order No. 670. approve certain information collection including the use of automated requirements imposed by agency information techniques. VI. Information Collection Statement rule.441 Burden Estimate: The public reporting 487. The following collections of 488. Comments are solicited on the and records retention burdens for the information contained in this proposed need for this information, whether the proposed reporting requirements and rule have been submitted to the Office information will have practical utility, the records retention requirement are as of Management and Budget (OMB) for ways to enhance the quality, utility, and follows.442

Number of re- Number of re- Hours per re- Total annual Data collection spondents sponses sponse hours

Part 35 (FERC–516): Conforming tariff changes ...... 176 1 25 4,400 Revision of Imbalance Charges ...... 176 1 5 880 ATC revisions ...... 176 1 40 7,040 Planning (Attachment K) ...... 176 1 100 17,600 Congestion studies ...... 176 1 250 44,000 Attestation of network resource commitment ...... 176 1 1 176 Quarterly Reports for capacity reassignment ...... 176 1 60 10,560 Operational Penalty annual filing ...... 176 1 10 1,760 Creditworthiness—include criteria in the tariff ...... 176 1 40 7,040

Sub Total Part 35 ...... 93,456 Part 37 (FERC–717): ATC-related standards. NERC/NAESB Team to develop ...... 1 1 1,920 1,920 Review and comment by utility ...... 176 1 20 3,520 Implementation by each utility ...... 176 1 40 7,040 Mandatory data exchanges ...... 176 1 80 14,080 Explanation of change of ATC values ...... 176 1 100 17,600 Reevaluate CBM and post quarterly ...... 176 1 20 3,520 Post OASIS metrics; requests accepted/denied ...... 176 1 80 14,080 Posting of metrics for System Impact Studies ...... 176 1 100 17,600 Post all rules to OASIS ...... 176 1 5 880

Sub Total (Part 37) ...... 80,240

Total (Part 35 + Part 37) ...... 173,696

Recordkeeping ...... 176 1 30 5,280

Total Annual Hours for Collection: requirements imposed by an agency transmission services are provided on a Reporting + recordkeeping hours = rule. The Commission is submitting basis that is just, reasonable and not 173,696 + 5,280 = 178,976 hours. notification of this proposed rule to unduly discriminatory or preferential. Cost to Comply: OMB. If the proposed requirements are The purpose of this rulemaking is to Reporting = $19,801,344 adopted they will be mandatory strengthen the pro forma OATT to 173,696 hours @ $114 an hour requirements. ensure that it achieves its original (average cost of attorney ($200 per Title: FERC–516, Electric Rate purpose—remedying undue hour), consultant ($150), technical Schedules and Tariff Filings; FERC–717 discrimination—not to create new ($80), and administrative support Standards for Business Practices and market structures. We propose to ($25)) Communication Protocols for Public achieve this goal by increasing the Recordkeeping = $1,392,160 Utilities. clarity and transparency of the rules Labor (file/record clerk @ $17 an Action: Proposed Collections. applicable to the planning and use of hour) 5,280 hours @ $17/hour = OMB Control Nos. 1902–0096 and the transmission system and by $89,760 1902–0173. addressing ambiguities and the lack of Storage 176 respondents @ 8,000 sq. Respondents: Business or other for sufficient detail in several important ft. × $925 (off-site storage) = profit. areas of the pro forma OATT. The lack $1,302,400 Frequency of responses: On occasion. of specificity in the pro forma OATT Total costs = $21,193,504 Necessity of the Information: creates opportunities for undue Labor $ ($19,801,344 + $89,760) + 489. The Federal Energy Regulatory discrimination as well as making the Recordkeeping Storage Costs Commission is proposing amendments undue discrimination that does occur ($1,302,400) to its regulations adopted in Order Nos. more difficult to detect. To accomplish OMB’s regulations require it to 888 and 889, and to the pro forma open this we are proposing five objectives: (1) approve certain information collection access transmission tariff, to ensure that To improve transparency and

440 44 U.S.C. 3507(d) (2000). 442 These burden estimates apply only to this 441 5 CFR 1320.11 (2005). NOPR and do not reflect upon all of FERC–516 or FERC–717.

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consistency in several critical areas, by environment.443 The Commission used to evaluate requests for waiver providing for greater consistency in the concludes that neither an under Order Nos. 888 and 889. Thus, calculation of ATC, (2) to reform the Environmental Assessment nor an small entities who have received waiver transmission planning requirements of Environmental Impact Statement is of the requirements to have on file an the pro forma OATT to eliminate required for this NOPR under section open access tariff or to operate an potential undue discrimination and 380.4(a)(15) of the Commission’s OASIS would be unaffected by the support the construction of adequate regulations, which provides a requirements of this proposed transmission facilities to meet the needs categorical exemption for approval of rulemaking. of all load-serving entities, (3) to remedy actions under sections 205 and 206 of IX. Comment Procedures certain portions of the pro forma OATT the FPA relating to the filing of that may have permitted utilities to schedules containing all rates and 494. The Commission invites discriminate against new merchant charges for the transmission or sale interested persons to submit comments generation, including intermittent subject to the Commission’s on the matters and issues proposed in generation, (4) to provide for greater jurisdiction, plus the classification, this notice to be adopted, including any transparency in the provision of practices, contracts and regulations that related matters or alternative proposals transmission service to allow affect rates, charges, classifications and that commenters may wish to discuss. transmission customers better access to services.444 Comments are due August 7, 2006. information to make their resource Reply comments are due September 5, VIII. Regulatory Flexibility Act procurement and investment decisions, 2006. Comments must refer to Docket Analysis as well as to increase the Commission’s Nos. RM05–25–000 and RM05–17–000, ability to detect any remaining incidents 493. The Regulatory Flexibility Act of and must include the commenters’ of undue discrimination, and (5) to 1980 (RFA) 445 generally requires a name, the organization they represent, if reform and provide greater clarity in description and analysis of proposed applicable, and their address in their areas that have generated recurring rules that will have significant comments. Comments may be filed disputes over the past 10 years, such as economic impact on a substantial either in electronic or paper format. rollover rights, ‘‘redirects,’’ and number of small entities. This rule 495. To facilitate the Commission’s generation redispatch. The reforms applies to public utilities that own, review of the comments, commenters proposed in this NOPR are intended to control or operate interstate are requested to provide an executive address deficiencies in the pro forma transmission facilities, not to electric summary of their position, not to exceed OATT that have become apparent since utilities per se. The total number of ten pages. Commenters are requested to the implementation of Order No. 888 in public utilities that, absent waiver, identify each section of the NOPR that 1996 and to facilitate improved would have to modify their current their discussion addresses and to use planning and operation of transmission OATTs by filing the revised pro forma conforming headings. Additional issues facilities. OATT is 176.446 Of these only six public the commenters wish to raise should be 490. Interested persons may obtain utilities, or less than two percent, clearly identified in a separate section information on the reporting dispose of four million MWh or less per entitled ‘‘Other Issues,’’ which should requirements by contacting the year.447 The Commission does not be organized by the relevant pro forma following: Federal Energy Regulatory consider this a substantial number, and OATT section (if applicable). Commission, 888 First Street, NE., in any event, these small entities may Furthermore, we also request that Washington, DC 20426, [Attention: seek waiver of these requirements.448 commenters with specific tariff language Michael Miller, Office of the Executive Moreover, the criteria for waiver that suggestions submit a redline/strikeout Director, Phone: (202) 502–8415, fax: would be applied under this rulemaking version showing their proposed changes (202) 273–0873, e-mail: for small entities is unchanged from that to the language that appears in the pro [email protected].] forma OATT attached to this NOPR.449 491. For submitting comments 443 Regulations Implementing the National The commenters should double space concerning the collections of Environmental Policy Act, Order No. 486, 52 FR their comments. To assist commenters information and the associated burden 47897 (Dec. 17, 1987), FERC Stats. & Regs. ¶ 30,783 in their review, the Commission has (1987). estimate(s), please send your comments 444 posted a copy of the proposed revised 18 CFR 380.4(a)(15) (2005). pro forma OATT with changes from the to the contact listed above and to the 445 5 U.S.C. 601–612 (2000). Office of Information and Regulatory 446 The sources for this figure are FERC Form No. current version of the pro forma OATT Affairs, Office of Management and 1 and FERC Form No. 1–F data. shown in redline/strikeout on the Budget, 725 17th Street, NW., 447 Id. following location on our Web site at Washington, DC 20503 [Attention: Desk 448 The Regulatory Flexibility Act defines a http://www.ferc.gov/industries/electric/ Officer for the Federal Energy ‘‘small entity’’ as ‘‘one which is independently indus-act/oatt-reform.asp. owned and operated and which is not dominant in 496. Comments and reply comments Regulatory Commission, phone (202) its field of operation.’’ See 5 U.S.C. 601(3) and 395–4650, fax: (202) 395–7285. Due to 601(6)(2000); 15 U.S.C. 632(a)(1)(2000). In Mid-Tex may be filed electronically via the security concerns, comments should be Elec. Coop. v. FERC, 773 F.2d 327, 340–343 (D.C. sent electronically to the following e- Cir. 1985), the court accepted the Commission’s 449 The pro forma OATT includes two conclusion that, since virtually all of the public amendments that have been made since the tariff mail address: utilities that it regulates do not fall within the was finalized in Order No. 888–B. First, the tariff [email protected]. Please meaning of the term ‘‘small entities’’ as defined in was amended to include protocols for curtailment reference the docket number of this the Regulatory Flexibility Act, the Commission did of multi-system transactions and parallel flows. See rulemaking in your submission. not need to prepare a regulatory flexibility analysis North American Reliability Council, 85 FERC in connection with its proposed rule governing the ¶ 61,353 (1998), reh’g denied, 87 FERC ¶ 61,161 VII. Environmental Analysis allocation of costs for construction work in progress (1999) and recently updated in North American (CWIP). The CWIP rules applied to all public Electric Reliability Council, 110 FERC ¶ 61,388 492. The Commission is required to utilities. The revised pro forma OATT will apply (2005). The second amendment incorporates prepare an Environmental Assessment only to those public utilities that own, control or standardized generator interconnection procedures. operate interstate transmission facilities. These See Order No. 2003. The standardized generator or an Environmental Impact Statement entities are a subset of the group of public utilities interconnection procedures are not included in the for any action that may have a found not to require preparation of a regulatory pro forma OATT attached to this NOPR because we significant adverse effect on the human flexibility analysis for the CWIP rule. do not propose changes to them.

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eFiling link on the Commission’s Web List of Subjects utility would engage in a sale of electric site at http://www.ferc.gov. The energy at wholesale in interstate 18 CFR Part 35 Commission accepts most standard commerce or in the transmission of word processing formats and Electric power rates, Electric utilities, electric energy in interstate commerce. commenters may attach additional files Reporting and recordkeeping (ii) If a public utility owns, controls, with supporting information in certain requirements. or operates facilities used for the other file formats. Documents created 18 CFR Part 37 transmission of electric energy in electronically using word processing interstate commerce as of ll, it must software should be filed in the native Conflict of interests, Electric power file the revisions to the pro forma tariff application or print-to-PDF format and plants, Electric utilities, Reporting and contained in Order No. ll, FERC not in a scanned format. This will recordkeeping requirements. Stats. & Regs. ¶ ll pursuant to section enhance document retrieval for both the By direction of the Commission. 206 of the FPA and accompanying rates Commission and the public. Magalie R. Salas, pursuant to section 205 of the FPA, no __ Attachments that exist only in paper Secretary. later than . (iii) If a public utility owns, controls, form may be scanned. Commenters In consideration of the foregoing, the or operates transmission facilities used filing electronically should not make a Commission proposes to amend parts 35 for the transmission of electric energy in paper filing. Service of rulemaking and 37, Chapter I, Title 18 of the Code interstate commerce as of ll, such comments is not required. Commenters of Federal Regulations, as follows: that are not able to file comments facilities are jointly owned with a non- electronically must send an original and PART 35—FILING OF RATE public utility, and the joint ownership 14 copies of their comments to: Federal SCHEDULES AND TARIFFS contract prohibits transmission service Energy Regulatory Commission, Office over the facilities to third parties, the 1. The authority citation for part 35 of the Secretary, 888 First Street, NE., public utility with respect to access over continues to read as follows: Washington, DC 20426. the public utility’s share of the jointly Authority: 16 U.S.C. 791a–825r, 2601– owned facilities must file no later than 497. All comments will be placed in 2645; 31 U.S.C. 9701; 42 U.S.C. 71–7352. ll the revisions to the pro forma tariff the Commission’s public files and may contained in Order No. ll, FERC 2. Amend § 35.28 as follows: be viewed, printed, or downloaded Stats. & Regs. ¶ ll, pursuant to section a. paragraph (c) is revised. remotely as described in the Document 206 of the FPA and accompanying rates b. paragraphs (d)(i) and d(ii) are Availability section below. Commenters pursuant to section 205 of the FPA. on this proposal are not required to redesignated as d(1) and d(2). c. newly redesignated paragraph d(1) (iv) Any public utility whose serve copies of their comments on other transmission facilities are under the commenters. is revised. d. paragraph (e)(1) (introductory text) independent control of a Commission- X. Document Availability is revised. approved ISO or RTO may satisfy its e. paragraph (e)(1)(ii) is revised. obligation under paragraph (c)(1) of this 498. In addition to publishing the full section, with respect to such facilities, text of this document in the Federal § 35.28 Non-discriminatory open access through the open access transmission Register, the Commission provides all transmission tariff. tariff filed by the ISO or RTO. interested persons an opportunity to * * * * * (v) If a public utility obtains a waiver view and/or print the contents of this (c) Non-discriminatory open access of the tariff requirement pursuant to document via the Internet through the transmission tariffs. paragraph (d) of this section, it does not Commission’s Home Page (http:// (1) Every public utility that owns, need to file the pro forma tariff required www.ferc.gov) and in the Commission’s controls, or operates facilities used for by this section. Public Reference Room during normal the transmission of electric energy in (vi) Any public utility that seeks a business hours (8:30 a.m. to 5 p.m. interstate commerce must have on file deviation from the pro forma tariff Eastern time) at 888 First Street, NE., with the Commission a tariff of general contained in Order No. 888, FERC Stats. Room 2A, Washington DC 20426. applicability for transmission services, & Regs. ¶31,036, as revised in Order No. including ancillary services, over such ll, FERC Stats. & Regs. ¶ ll, must 499. From the Commission’s Home facilities. Such tariff must be the open demonstrate that the deviation is Page on the Internet, this information is access pro forma tariff contained in consistent with the principles of Order available in the Commission’s document Order No. 888, FERC Stats. & Regs. No., __ FERC Stats. & Regs. ¶ ll. management system, eLibrary. The full ¶ 31,036, as revised by the open access (vii) Each public utility’s open access text of this document is available on pro forma tariff contained in Order No. transmission tariff must include the eLibrary in PDF and Microsoft Word ll, FERC Stats. & Regs. ¶ ll, or such standards incorporated by reference in format for viewing, printing, and/or other open access tariff as may be part 38 of this chapter. downloading. To access this document approved by the Commission consistent (2) Subject to the exceptions in in eLibrary, type ‘‘RM05–25’’ or with Order No. ll, FERC Stats. & paragraphs (c)(2)(i) and (c)(3)(iii) of this ‘‘RM05–17’’ in the docket number field. Regs. ¶ ll. section, every public utility that owns, 500. User assistance is available for (i) Subject to the exceptions in controls, or operates facilities used for eLibrary and the Commission’s website paragraphs (c)(1)(ii), (c)(1)(iii), (c)(1)(iv) the transmission of electric energy in during normal business hours. For and (c)(1)(v) of this section, the pro interstate commerce, and that uses those assistance, please contact the forma tariff contained in Order No. 888, facilities to engage in wholesale sales Commission’s Online Support at 1–866– FERC Stats. & Regs. ¶31,036, as revised and/or purchases of electric energy, or 208–3676 (toll free) or 202–502–6652 (e- by the open access pro forma tariff unbundled retail sales of electric energy, mail at [email protected]), contained in Order No. ll, FERC must take transmission service for such or the Public Reference Room at 202– Stats. & Regs. ¶ ll, and accompanying sales and/or purchases under the open 502–8371, TTY 202–502–8659 (e-mail at rates, must be filed no later than 60 days access tariff filed pursuant to this [email protected]). prior to the date on which a public section.

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(i) For sales of electric energy 1996 must take transmission service Authority: 16 U.S.C. 791–825r, 2601–2645; pursuant to a requirements service under a joint pool-wide or system-wide 31 U.S.C. 9701; 42 U.S.C. 7101–7352. agreement executed on or before July 9, pro forma tariff filed pursuant to this 4. Amend § 37.6 as follows: 1996, this requirement will not apply section for wholesale trades among the a. paragraph (a)(1) is revised. unless separately ordered by the pool or system members. b. paragraph (b)(introductory text) is Commission. For sales of electric energy (4) Consistent with paragraph (c)(1) of revised. pursuant to a bilateral economy energy this section, every Commission- c. paragraphs (b)(1)(v) through coordination agreement executed on or approved ISO or RTO must have on file (b)(1)(viii) are added. before July 9, 1996, this requirement is with the Commission a tariff of general d. paragraphs (b)(2)(i) and b(2)(ii) are effective on December 31, 1996. For applicability for transmission services, revised. sales of electric energy pursuant to a including ancillary services, over such e. paragraph (b)(3) is revised. bilateral non-economy energy facilities. Such tariff must be the open f. paragraph (c)(2) is revised. coordination agreement executed on or access pro forma tariff contained in g. paragraphs (e)(1) and (e)(2)(ii) are before July 9, 1996, this requirement Order No. 888, FERC Stats. & Regs. revised. will not apply unless separately ordered ¶ 31,036, as revised by the open access h. paragraph (e)(3)(ii) is revised. by the Commission. pro forma tariff contained in Order No. i. paragraphs (h) and (i) are added. (ii) [Reserved.] ll, FERC Stats. & Regs. ¶ ll, or such (3) Every public utility that owns, § 37.6 Information to be posted on the other open access tariff as may be OASIS. controls, or operates facilities used for approved by the Commission consistent (a) * * * the transmission of electric energy in with Order No. ll, FERC Stats. & interstate commerce, and that is a (1) Make requests for transmission Regs. ¶ ll. services offered by Transmission member of a power pool, public utility (i) Subject to paragraph (c)(4)(ii) of holding company, or other multi-lateral Providers, Resellers and other providers this section, a Commission-approved of ancillary services, request the trading arrangement or agreement that ISO or RTO must file the revisions to contains transmission rates, terms or designation of a network resource, and the pro forma tariff contained in Order request the termination of the conditions, must have on file a joint ll ll No. , FERC Stats. & Regs. ¶ , designation of a network resource; pool-wide or system-wide open access pursuant to section 206 of the FPA and transmission pro forma tariff, which accompanying rates pursuant to section * * * * * tariff must be the open access pro forma 205 of the FPA, no later than ll. (b) Posting transfer capability. The tariff contained in Order No. 888, FERC (ii) If a Commission-approved ISO or available transfer capability on the Stats. & Regs. ¶ 31,036, as revised by the RTO can demonstrate that its existing Transmission Provider’s system (ATC) open access pro forma tariff contained open access tariff is consistent with or and the total transfer capability (TTC) of in Order No. ll, FERC Stats. & Regs. superior to the revisions to the pro that system shall be calculated and ¶ ll, or such other open access tariff forma tariff contained in Order No. ll, posted for each Posted Path as set out as may be approved by the Commission FERC Stats. & Regs. ¶ ll, or any in this section. consistent with Order No. ll, FERC portions thereof, the Commission- (1) * * * Stats. & Regs. ¶ ll. approved ISO or RTO may instead set (v) Available transfer capability or (i) For any power pool, public utility forth such demonstration in its filing ATC means the transfer capability holding company or other multi-lateral pursuant to section 206 no later than remaining in the physical transmission arrangement or agreement that contains ll. network for further commercial activity transmission rates, terms or conditions (d) Waivers. *** over and above already committed uses, and that is executed after July 9, 1996, (1) No later than ll, or or such definition as contained in this requirement is effective on the date Commission-approved Reliability * * * * * that transactions begin under the (e) Non-public utility procedures for Standards. (vi) Total transfer capability or TTC arrangement or agreement. tariff reciprocity compliance. (1) A non- (ii) For any power pool, public utility means the amount of electric power that public utility may submit a transmission holding company or other multi-lateral can be moved or transferred reliably tariff and a request for declaratory order arrangement or agreement that contains from one area to another area of the that its voluntary transmission tariff transmission rates, terms or conditions interconnected transmission systems by meets the requirements of Order No. and that is executed on or before July 9, way of all transmission lines (or paths) 888, FERC Stats. & Regs. ¶ 31,036 and 1996, a public utility member of such between those areas under specified Order No. ll, FERC Stats. & Regs. power pool, public utility holding system conditions, or such definition as ¶ ll. company or other multi-lateral (i) * * * contained in Commission-approved arrangement or agreement that owns, (ii) If the submittal is found to be an Reliability Standards. controls, or operates facilities used for acceptable transmission tariff, an (vii) Capacity Benefit Margin or CBM the transmission of electric energy in applicant in a Federal Power Act (FPA) means the amount of TTC preserved by interstate commerce must file the section 211 or 211A proceeding against the Transmission Provider for load- revisions to its joint pool-wide or the non-public utility shall have the serving entities, whose loads are located system-wide contained in Order No. burden of proof to show why service on that Transmission Provider’s system, ll, FERC Stats. & Regs. ¶ ll, under the open access tariff is not to enable access by the load-serving pursuant to section 206 of the FPA and sufficient and why a section 211 or entities to generation from accompanying rates pursuant to section 211A order should be granted. interconnected systems to meet 205 of the FPA, no later than ll. generation reliability requirements, or (iii) A public utility member of a * * * * * such definition as contained in power pool, public utility holding PART 37—OPEN ACCESS SAME-TIME Commission-approved Reliability company or other multi-lateral INFORMATION SYSTEMS Standards. arrangement or agreement that contains (viii) Transmission Reliability Margin transmission rates, terms or conditions 3. The authority citation for part 37 or TRM means the amount of TTC and that is executed on or before July 9, continues to read as follows: necessary to provide reasonable

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assurance that the interconnected prescribed under paragraph (b)(3)(i)(A) standards and practices that relate to transmission network will be secure, or (2) and (3) of this section. The posting transmission services. such definition as contained in of non-firm ATC and TTC shall show * * * * * Commission-approved Reliability CBM as zero. (e) Posting specific transmission and Standards. (C) Updating Posted Information for ancillary service requests and (2) * * * Constrained Paths. (1) The capability responses—(1) General rules. (i) All (i) Information used to calculate any posted under paragraphs (b)(3)(i) (A) requests for transmission and ancillary posting of ATC and TTC must be dated and (B) of this section must be updated service offered by Transmission and time-stamped and all calculations when transactions are reserved or Providers under the pro forma tariff, shall be performed according to service ends or whenever the TTC including requests for discounts, and all consistently applied methodologies estimate for the Path changes by more requests to designate or terminate a referenced in the Transmission than 10 percent. network resource, must be made on the Provider’s transmission tariff and shall (2) All updating of hourly information OASIS and posted prior to the be based on Commission-approved shall be made on the hour. Transmission Provider responding to Reliability Standards as well as current (3) When the monthly and yearly the request, except as discussed in industry practices, standards and capability posted under paragraphs paragraphs (e)(1) (ii) and (iii) of this criteria (b)(3)(i)(A) and (B) are updated, the section. The Transmission Provider (ii) On request, the Responsible Party Transmission Provider shall post a brief, must post all requests for transmission must make all data used to calculate but specific, narrative explanation of the service, for ancillary service, and for the ATC, TTC, CBM, and TRM for any reason for the update. This narrative designation or termination of a network constrained posted paths publicly should include, if relevant, scheduling resource comparably. Requests for available (including the limiting of planned outages and occurrence of transmission service, ancillary service, element(s) and the cause of the limit forced transmission outages, de-ratings and to designate and terminate a (e.g., thermal, voltage, stability)) in of transmission facilities, scheduling of network resource, as well as the electronic form within one week of the planned generation outages and responses to such requests, must be posting. The information is required to occurrence of forced generation outages, conducted in accordance with the be provided only in the electronic changes in load forecast, changes in new Transmission Provider’s tariff, the format in which it was created, along facilities’ in-service dates, or other Federal Power Act, and Commission with any necessary decoding events or assumption changes that regulations. instructions, at a cost limited to the cost caused the update. (ii) The requirement in paragraph (ii) Unconstrained posted paths. (A) of reproducing the material. This (e)(1)(i) of this section, to post requests Postings of firm and nonfirm ATC, TTC, information is to be retained for six for transmission and ancillary service CBM, and TRM shall be posted months after the applicable posting offered by Transmission Providers separately by the day, showing for the period. under the pro forma tariff, including current day and the next six days * * * * * requests for discounts, prior to the following and thereafter, by the month (3) Posting. The ATC, TTC, CBM, and Transmission Provider responding to for the 12 months next following. If the TRM for all Posted Paths must be posted the request, does not apply to requests Transmission Provider charges in megawatts by specific direction and for next-hour service made during Phase separately for on-peak and off-peak in the manner prescribed in this I. periods in its tariff, ATC, TTC, CBM, subsection. (iii) In the event that a discount is and TRM will be posted separately for (i) Constrained posted paths—(A) For being requested for ancillary services the current day and the next six days Firm ATC and TTC. (1) The posting that are not in support of basic following for each period. These shall show ATC, TTC, CBM, and TRM transmission service provided by the postings are to be updated whenever the for a 30-day period. For this period Transmission Provider, such request ATC changes by more than 20 percent postings shall be: By the hour, for the need not be posted on the OASIS. of the Path’s TTC. current hour and the 168 hours next (B) If planning and specific requested (iv) In processing a request for following; and thereafter, by the day. If transmission studies have been done, transmission or ancillary service, the the Transmission Provider charges seasonal capability shall be posted for Responsible Party shall post the same separately for on-peak and off-peak the year following the current year and information as required in paragraphs periods in its tariff, ATC, TTC, CBM, for each year following until the end of (c)(4) and (d)(3) of this section, and the and TRM will be posted daily for each the planning horizon but not to exceed following information: the date and time period. 10 years. when the request is made, its place in (2) Postings shall also be made by the (iii) Calculation of CBM. any queue, the status of that request, month, showing for the current month (A) The Transmission Provider must and the result (accepted, denied, and the 12 months next following. reevaluate its CBM needs at least withdrawn). In processing a request to (3) If planning and specific requested quarterly. designate or terminate the designation transmission studies have been done, (B) The Transmission Provider must of a network resource, the Responsible seasonal capability shall be posted for post its practices for reevaluating its Party shall post the date and time when the year following the current year and CBM needs. the request is made. for each year following to the end of the (c) Posting Transmission Service (v) For any request to designate or planning horizon but not to exceed 10 Products and Prices. terminate a network resource, the years. (1) * * * Transmission Provider (at the time (B) For Non-Firm ATC and TTC. The (2) Transmission Providers must when the request is received), must post posting shall show ATC, TTC, CBM and provide a downloadable file of their on the OASIS (and make available for TRM for a 30-day period by the hour complete tariffs in the same electronic download) information describing the and days prescribed under paragraph format as the tariff that is filed with the request (including: name of requestor, (b)(3)(i)(A)(1) of this section and, if so Commission. Transmission Providers identification of the resource, effective requested, by the month and year as also must post all of their rules, time for the designation or termination,

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identification of whether the transaction conducts of transmission service system impact study queue during the involves the Transmission Provider’s requests on another Transmission reporting quarter, wholesale merchant function or any Provider’s OASIS. (B) Number of transmission service affiliate; and any other relevant terms (i) Process Time from Initial Service requests withdrawn from the and conditions) and shall keep such Request to Offer of System Impact Study Responsible Party’s system impact study information posted on the OASIS for at Agreement. queue during the reporting quarter more least 30 days. A record of the (A) Number of new system impact than 60 days after the Responsible Party transaction must be retained and kept study agreements delivered during the received the executed system impact available as part of the audit log reporting quarter to entities that request study agreement, and required in § 37.7. transmission service, (C) Mean time (in days), for all (vi) The Transmission Provider shall (B) Number of new system impact transmission service requests post a list of its current designated study agreements delivered during the withdrawn from the Responsible Party’s network resources and all network reporting quarter to entities that request system impact study queue during the customers’ current designated network transmission service more than thirty reporting quarter, from the date the resources on OASIS. The list of network (30) days after the Responsible Party Responsible Party received the executed resources should include the name of received the request for transmission system impact study agreement to date the resource, its geographic and service, when request was withdrawn from the electrical location, its total installed (C) Mean time (in days), for all Responsible Party’s system impact study capacity, and the amount of capacity to requests acted on by the Responsible queue. be designated as a network resource. Party during the reporting quarter, from (iv) Process Time from Completed (2) * * * the date when the Responsible Party System Impact Study to Offer of (ii) Information to support the reason received the request for transmission Facilities Study. (A) Number of new for the denial, including the operating service to when the Responsible Party facilities study agreements delivered status of relevant facilities, must be changed the transmission service during the reporting quarter to entities maintained for five years and provided, request status to indicate that the that request transmission service, upon request, to the potential Responsible Party could offer (B) Number of new facilities study Transmission Customer. transmission service or needed to agreements delivered during the * * * * * perform a system impact study, reporting quarter to entities that request (3) Posting when a transaction is (D) Mean time (in days), for all system transmission service more than thirty curtailed or interrupted. (ii) Information impact study agreements delivered by (30) days after the Responsible Party to support any such curtailment or the Responsible Party during the completed the system impact study, (C) Mean time (in days), for all interruption, including the operating reporting quarter, from the date when facilities study agreements delivered by status of the facilities involved in the the Responsible Party received the the Responsible Party during the constraint or interruption, must be request for transmission service to the reporting quarter, from the date when maintained and made available upon date when the Responsible Party the Responsible Party completed the request, to the curtailed or interrupted delivered a system impact study system impact study to the date when customer, the Commission’s Staff, and agreement, and the Responsible Party delivered a any other person who requests it, for (E) Number of new system impact facilities study agreement, and five years. study agreements executed during the (D) Number of new facilities study reporting quarter. * * * * * agreements executed during the (h) Posting information summarizing (ii) System Impact Study Processing reporting quarter. the time to complete transmission Time. (A) Number of system impact (v) Facilities Study Processing Time. service request studies. (1) For each studies completed by the Responsible (A) Number of facilities studies calendar quarter, the Responsible Party Party during the reporting quarter, completed by the Responsible Party must post the set of measures detailed (B) Number of system impact studies during the reporting quarter, in paragraph (h)(1)(i) through paragraph completed by the Responsible Party (B) Number of facilities studies (h)(1)(vi) of this section related to the during the reporting quarter more than completed by the Responsible Party Responsible Party’s processing of 60 days after the Responsible Party during the reporting quarter more than transmission service request system received an executed system impact 60 days after the Responsible Party impact studies and facilities studies. study agreement, received an executed facilities study The Responsible Party must calculate (C) Mean time (in days), for all system agreement, and post the measures in paragraph impact studies completed by the (C) Mean time (in days), for all (h)(1)(i) through paragraph (h)(1)(vi) of Responsible Party during the reporting facilities studies completed by the this section separately for requests for quarter, from the date when the Responsible Party during the reporting short-term firm point-to-point Responsible Party received the executed quarter, from the date when the transmission service, long-term firm system impact study agreement to the Responsible Party received the executed point-to-point transmission service, and date when the Responsible Party facilities study agreement to the date requests to designate a new network provided the system impact study to the when the Responsible Party provided resource and must be calculated and entity who executed the system impact the facilities study to the entity who posted separately for transmission study agreement, and executed the facilities study agreement, service requests from Affiliates and (D) Mean cost of system impact (D) Mean cost of facilities studies transmission service requests from studies completed by the Responsible completed by the Responsible Party Transmission Customers who are not Party during the reporting quarter. during the reporting quarter, and Affiliates. The Responsible Party is (iii) Transmission Service Requests (E) Mean cost of upgrades required to include in the calculations Withdrawn from the System Impact recommended in facilities studies of the measures in paragraph (h)(1)(i) Study Queue. (A) Number of completed during the reporting quarter. through paragraph (h)(1)(vi) of this transmission service requests (vi) Service Requests Withdrawn from section all studies the Responsible Party withdrawn from the Responsible Party’s Facilities Study Queue.

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(A) Number of transmission service calculating the percent of studies Party is required to post data each requests withdrawn from the completed more than sixty (60) days month listing, by path or flowgate, the Responsible Party’s facilities study after the Responsible Party delivers the number of transmission service requests queue during the reporting quarter, appropriate study agreement, the that have been accepted and the number (B) Number of transmission service Responsible Party should aggregate all of transmission service requests that requests withdrawn from the system impact studies and facilities have been denied during the prior Responsible Party’s facilities study studies that it completes during the month. This posting must distinguish queue during the reporting quarter more reporting quarter. The Responsible Party between the length of the service than 60 days after the Responsible Party must calculate and post the measures in request (e.g., short-term or long-term received the executed facilities study paragraph (h)(3)(i) through paragraph requests) and between the type of agreement, and (h)(3)(iv) of this section separately for service requested (e.g., firm point-to- (C) Mean time (in days), for all requests for short-term firm point-to- point, non-firm point-to-point or transmission service requests point transmission service, long-term network service). The posted data must withdrawn from the Responsible Party’s firm point-to-point transmission service, show: facilities study queue during the and requests to designate a new network (1) The number of non-Affiliate reporting quarter, from the date the resource and must be calculated and requests for transmission service that Responsible Party received the executed posted separately for transmission have been rejected, facilities study agreement to date when service requests from Affiliates and request was withdrawn from the (2) The total number of non-Affiliate transmission service requests from requests for transmission service that Responsible Party’s facilities study Transmission Customers who are not queue have been made, Affiliates. (3) The number of Affiliate requests (2) The Responsible Party is required (i) Mean, across all system impact for transmission service that have been to post the measures in paragraph studies the Responsible Party completes rejected, and (h)(1)(i) through paragraph (h)(1)(vi) of during the reporting quarter, of the this section for each calendar quarter employee-hours expended per system (4) The total number of Affiliate within 15 days of the end of the impact study the Responsible Party requests for transmission service that calendar quarter. The Responsible Party completes during reporting period; have been made. will keep the quarterly measures posted (ii) Mean, across all facilities studies 5. In § 37.7, paragraph (b) is revised to on OASIS for three calendar years. the Responsible Party completes during read as follows: (3) The Responsible Party will be the reporting quarter, of the employee- required to post on OASIS the measures § 37.7 Auditing Transmission Service hours expended per facilities study the Information. in paragraph (h)(3)(i) through paragraph Responsible Party completes during (h)(3)(iv) of this section in the event the reporting period; * * * * * Responsible Party, for two consecutive (iii) The number of employees the (b) Audit data must remain available calendar quarters, completes more than Responsible Party has assigned to for download on the OASIS for 90 days, twenty (20) percent of the studies process system impact studies; except ATC/TTC postings that must associated with requests for (iv) The number of employees the remain available for download on the transmission service from entities that Responsible Party has assigned to OASIS for 20 days. The audit data are are not Affiliates of the Responsible process facilities studies. to be retained and made available upon Party more than sixty (60) days after the (4) The Responsible Party is required request for download for five years from Responsible Party delivers the to post the measures in paragraph the date when they are first posted in appropriate study agreement. The (h)(3)(a) through paragraph (h)(3)(d) of the same electronic form as used when Responsible Party will have to post the this section for each calendar quarter they originally were posted on the measures in paragraph (h)(3)(i) through within 15 days of the end of the OASIS. paragraph (h)(3)(iv) of this section until calendar quarter. The Responsible Party Note: The following appendices will not be it processes at least ninety (90) percent will keep the quarterly measures posted published in the Code of Federal of all studies within 60 days after it has on OASIS for five calendar years. Regulations. received the appropriate executed study (i) Posting data related to grants and agreement. For the purposes of denials of service. The Responsible Appendix A: Commenter Acronyms

INITIAL COMMENTERS IN DOCKET NO. RM05–25–000

Abbreviation RM05–25–000 Initial comments

AEP ...... American Electric Power System (AEP Texas North Company; AEP Texas Central Company; Appalachian Power Company; Columbus Southern Power Company; Indiana Michigan Power Company; Ken- tucky Power Company; Kingsport Power Company; Ohio Power Company; Public Service Company of Oklahoma; Southwestern Electric Power Company and Wheeling Power Company). Alabama MEA ...... Alabama Municipal Electric Authority. Alberta Intervenors ...... Alberta Intervenors (TransCanada Energy Ltd.; ENMAX Energy Mar- keting, Inc.; EPCOR Merchant and Capital, LP; and TransAlta Cor- poration). Alberta System Operator ...... Alberta Electric System Operator. Alcoa ...... Alcoa Inc. and Alcoa Power Generating Inc. Alliance of State Leaders ...... Alliance of State Leaders Protecting Electricity Consumers.

450 A ‘‘*’’ indicates that the commenter filed a notice of intervention only.

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INITIAL COMMENTERS IN DOCKET NO. RM05–25–000—Continued

Abbreviation RM05–25–000 Initial comments

Ameren ...... Ameren Services Company (Central Illinois Light Company d/b/a AmerenCILCO; Central Illinois Public Service Company d/b/a AmerenCIPS; Illinois Power Company d/b/a AmerenIP; Union Elec- tric Company d/b/a AmerenUE; Ameren Energy Marketing Company; Ameren Energy Generating Company; and AmerenEnergy Re- sources Generating Company). American Forest and Paper* 450 ...... American Forest and Paper Association. American Transmission ...... American Transmission Company LLC. AMP-Ohio ...... American Municipal Power-Ohio, Inc. APPA ...... American Public Power Association. APS ...... Arizona Public Service Company. Arkansas Cities ...... Arkansas Cities and Cooperative (Conway Corporation; West Memphis Utilities Commission; City of Osceola, Arkansas; City of Prescott, Ar- kansas; Hope Water & Light Commission; and Farmers Electric Co- operative Cooperation). Arkansas Commission ...... Arkansas Public Service Commission. AWEA ...... American Wind Energy Association. BC Transmission ...... British Columbia Transmission Corporation. Bonneville ...... Bonneville Power Administration. Bureau of Reclamation ...... U.S. Bureau of Reclamation. CAISO ...... California Independent System Operator Corporation. California Commission ...... Public Utilities Commission of the State of California. Calpine ...... Calpine Corporation. Canadian Electricity Association ...... Canadian Electricity Association. Chelan ...... Public Utility District No. 1 of Chelan County and Public Utility District No. 2 of Grant County. Cinergy ...... Cinergy Services, Inc. (Cincinatti Gas & Electric Company; PSI Energy, Inc.; and Union Light, Heat and Power Company). Constellation ...... Constellation Energy Group, Inc. Cottonwood ...... Cottonwood Energy Company LP and Union Power Partners, LP. Detroit Edison ...... Detroit Edison Company. Douglas ...... Public Utility District No. 1 of Douglas County. Duke ...... Duke Energy Corporation. East Texas Cooperatives ...... East Texas Electric Cooperative, Inc.; Northeast Texas Electric Coop- erative, Inc.; Sam Rayburn Generation and Electric Cooperative, Inc.; and Tex-La Electric Cooperative of Texas, Inc. Edison Mission ...... Edison Mission Energy, Edison Mission Marketing & Trading, Inc. and Midwest Generation EME, LLC. EEI ...... Edison Electric Institute. ELCON ...... Electricity Consumers Resource Council, American Iron and Steel Insti- tute and American Chemistry Council. Entergy ...... Entergy Services, Inc. EPSA ...... Electric Power Supply Association. Exelon ...... Exelon Corporation. Fayetteville ...... Public Works Commission of the City of Fayetteville, North Carolina. FirstEnergy ...... FirstEnergy Service Company (FirstEnergy Solutions; American Trans- mission Systems, Inc.; Jersey Central Power and Light Company; Metropolitan Edison Company; and Pennsylvania Electric Company). Florida Industrial Cogeneration Association ...... Florida Industrial Cogeneration Association. FMPA ...... Florida Municipal Power Agency. FP&L ...... Florida Power & Light Company. Hogan ...... William H. Hogan. HQ Energy ...... HQ Energy Services (U.S.), Inc. IECG* ...... Industrial Energy Consumer Group. Indicated New York Transmission Owners ...... Indicated New York Transmission Owners (Central Hudson Gas & Electric Corp.; Consolidated Edison Company of New York, Inc.; New York State Electric & Gas Corp.; Orange and Rockland Utilities, Inc.; LIPA; New York Power Authority; and Rochester Gas and Elec- tric Corp.). International Transmission ...... International Transmission Company. ISO New England ...... ISO New England, Inc. and New England Power Pool. ISO/RTO ...... ISO/RTO Council. KCP&L ...... Kansas City Power & Light Company. Kentucky Commission ...... Kentucky Public Service Commission. Lafayette ...... Lafayette Utilities System of the City and Parish of Lafayette, Lou- isiana; Mississippi Delta Energy Agency, Clarksdale Public Utilities Commission of the City of Clarksdale, Mississippi; and Public Serv- ice Commission of the City of Yazoo City, Mississippi. LDWP ...... City of Los Angeles Department of Water and Power. LG&E ...... LG&E Energy LLC (Louisville Gas and Electric Company and Kentucky Utilities Company). LPPC ...... Large Public Power Council.

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INITIAL COMMENTERS IN DOCKET NO. RM05–25–000—Continued

Abbreviation RM05–25–000 Initial comments

MEAG ...... MEAG Power. Memphis Light ...... Memphis Light, Gas & Water Division. Metropolitan Water District ...... Metropolitan Water District of Southern California. MidAmerican ...... MidAmerican Energy Company. Midwest Municipals ...... Midwest Municipal Transmission Group. Midwest SATs...... Midwest Stand-Alone Transmission Companies (American Trans- mission Company LLC; International Transmission Company; and Michigan Electric Transmission Company, LLC). MISO ...... Midwest Independent Transmission System Operator, Inc. MISO States ...... Organization of MISO States. Montana Alberta Tie ...... Montana Alberta Tie Ltd. NARUC ...... National Association of Regulatory Utility Commissioners. National Grid ...... National Grid USA. NCPA ...... Northern California Power Agency. Nevada Commission ...... Public Utilities Commission of Nevada. Nevada Companies ...... Nevada Power Company and Sierra Pacific Power Company. New York Commission ...... New York State Public Service Commission. North Carolina Commission ...... North Carolina Utilities Commission; Public Staff of the North Carolina Utilities Commission; and the Attorney General of the State of North Carolina. Northeast Utilities ...... Northeast Utilities Service Company (Connecticut Light and Power Company; Western Massachusetts Electric Company; Public Service Company of New Hampshire; Holyoke Water Power Company; and Holyoke Power and Electric Company). Northwest IPPs...... Northwest Independent Power Producers Coalition (BP Energy; Calpine Corporation; EPCOR; National Energy Supply Company; Northwest Energy Development; Sempra Generation; Suez Energy North America, Inc.; and TransAlta Energy Marketing, (U.S.) Inc.). Northwest Unregulated TUs ...... Northwest Unregulated Transmitting Utilities (Clark Public Utilities; Pub- lic Utility District No. 1 of Cowlitz County; Eugene Water and Electric Board; Public Utility District No. 2 of Grant County; Public Utility Dis- trict No. 1 of Snohomish County; and Tacoma Power). NorthWestern ...... NorthWestern Corporation. NPPD ...... Nebraska Public Power District. NRECA ...... National Rural Electric Cooperative Association. Occidental ...... Occidental Chemical Corporation. Ohio Commission ...... Public Utilities Commission of Ohio. Oklahoma Commission ...... Oklahoma Corporation Commission. Old Dominion ...... Old Dominion Electric Cooperative. PacifiCorp ...... PacifiCorp. PJM ...... PJM Interconnection, L.L.C. PNM–TNMP ...... Public Service Company of New Mexico and Texas-New Mexico Power Company. Portland General ...... Portland General Electric Company. Powerex ...... Powerex Corp. PPL ...... PPL Companies (PPL Electric Utilities Corporation; PPL EnergyPlus, LLC; PPL Montana, LLC; PPL Holtwood, LLC; Lower Mount Bethel Energy, LLC; PPL Maine, LLC; PPL Great Works, LLC; PPL Colstrip I, LLC; PPL Colstrip II, LLC; PPL Martins Creek, LLC; PPL Brunner Island, LLC; PPL Montour, LLC; PPL Susquehanna, LLC; PPL Wal- lingford Energy, LLC; PPL Southwest Generation Holdings, LLC; PPL University Park, LLC, PPL Shoreham Energy, LLC; and PPL Edgewood Energy, LLC). Progress Energy...... Progress Energy, Inc. (Carolina Power & Light Company d/b/a Progress Energy Carolinas and Florida Power Corporation, d/b/a Progress Energy Florida). Public Power Council ...... Public Power Council. Renewable Energy ...... Renewable Energy and Public Interest Organizations (American Wind Energy Association; Citizens for Pennsylvania’s Future (PennFuture); Minnesotans for an Energy Efficient Economy; Natural Resources Defense Council; Ohio Consumers’ Council; Pace Energy Project; Project for Sustainable FERC Energy Policy; Renewable Northwest Project; The Stella Group, Ltd.; The Wind Coalition; and West Wind Wires). Rural Utilities Service ...... U.S. Department of Agriculture Rural Utilities Service. Sacramento ...... Sacramento Municipal Utility District. Salt River ...... Salt River Project Agricultural Improvement and Power District. San Diego G&E ...... San Diego Gas & Electric Company. Santa Clara ...... City of Santa Clara, California d/b/a Silicon Valley Power. Santee Cooper ...... South Carolina Public Service Authority. Sempra Global ...... Sempra Global. SEPA ...... Southeastern Power Administration.

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INITIAL COMMENTERS IN DOCKET NO. RM05–25–000—Continued

Abbreviation RM05–25–000 Initial comments

Snohomish ...... Public Utility District No. 1 of Snohomish County, Washington. South Carolina E&G ...... South Carolina Electric & Gas Company. Southern ...... Southern Company Services, Inc. Southern Montana Coop ...... Southern Montana Electric Generation and Transmission Cooperative, Inc. Southwest TDU Group ...... Southwest Transmission Dependent Utility Group (Aguila Irrigation Dis- trict; Ak-Chin Energy Services; Buckeye Water Conservation and Drainage District; Central Arizona Water Conservation District; Elec- trical District No. 3; Electrical District No. 4; Electrical District No. 5; Electrical District No. 6; Electrical District No. 7; Electrical District No. 8; Harquahala Valley Power District; Maricopa County Municipal Water District No. 1; McMullen Valley Water Conservation and Drain- age District; City of Needles; Roosevelt Irrigation District; City of Safford; Tonopah Irrigation District; Wellton-Mohawk Irrigation and Drainage District). Southwestern Coop ...... Southwestern Electric Cooperative, Inc. SPP ...... Southwest Power Pool, Inc. Steel Manufacturers Association ...... Steel Manufacturers Association. Suez Energy NA ...... Suez Energy North America. Tacoma ...... Tacoma Power. TANC ...... Transmission Agency of Northern California. TAPS ...... Transmission Access Policy Study Group. TDU Systems ...... Transmission Dependent Utilities Systems. Tennessee Valley PPA ...... Tennessee Valley Public Power Association. TransAlta ...... TransAlta Energy Marketing (U.S.) Inc. Trans-Elect ...... Trans-Elect, Inc. TVA ...... Tennessee Valley Authority. WAPA ...... Western Area Power Administration. Williams ...... Williams Power Company, Inc. Wisconsin Commission ...... Public Service Commission of Wisconsin. Wisconsin Electric ...... Wisconsin Electric Power Company. Wyoming Infrastructure* ...... Wyoming Infrastructure Authority. Xcel ...... Xcel Energy Services, Inc.

REPLY COMMENTERS IN DOCKET NO. RM05–25–000

RM05–25–000 reply Abbreviation comments

Alberta Intervenors ...... Alberta Intervenors (TransCanada Energy Ltd.; ENMAX Energy Mar- keting, Inc.; EPCOR Merchant and Capital, LP; and TransAlta Cor- poration). Anaheim ...... Cities of Anaheim, Azusa, Banning, Colton, Pasadena and Riverside, California. APPA ...... American Public Power Association. BC Transmission ...... British Columbia Transmission Corporation. Bonneville ...... Bonneville Power Administration. California Municipal Utilities Association ...... California Municipal Utilities Association. Cogeneration Association of California ...... Cogeneration Association of California and Energy Producers and Users Coalition. EEI ...... Edison Electric Institute. ElectriCities ...... ElectriCities of North Carolina, Inc. Entergy ...... Entergy Services, Inc. EPSA ...... Electric Power Supply Association. Fallon ...... City of Fallon, Nevada. Fertilizer Institute ...... Fertilizer Institute. FMPA ...... Florida Municipal Power Agency. FP&L ...... Florida Power & Light Company. Great Northern ...... Great Northern Power Development, L.P. Joint Commenters ...... Joint Commenters (Duke Energy. Corporation, Progress Energy Cor- poration, South Carolina Public Service Authority and Southern Com- pany Services, Inc.). Lafayette+ thnsp;451 ...... Lafayette Utilities System of the City and Parish of Lafayette, Lou- isiana; Mississippi Delta Energy Agency, Clarksdale Public Utilities Commission of the City of Clarksdale, Mississippi; and Public Serv- ice Commission of the City of Yazoo City, Mississippi. LDWP ...... City of Los Angeles Department of Water and Power. LPPC ...... Large Public Power Council. Mark Lively+ ...... Mark B. Lively. MEAG ...... MEAG Power. Memphis Light ...... Memphis Light, Gas & Water Division.

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REPLY COMMENTERS IN DOCKET NO. RM05–25–000—Continued

RM05–25–000 reply Abbreviation comments

Midwest Municipals ...... Midwest Municipal Transmission Group . Midwest SATs...... Midwest Stand-Alone Transmission Companies (American Trans- mission Company LLC; International Transmission Company; and Michigan Electric Transmission Company, LLC). NARUC ...... National Association of Regulatory Utility Commissioners. National Grid ...... National Grid USA. NCPA ...... Northern California Power Agency. Newmont Mining ...... Newmont USA Limited, d/b/a Newmont Mining Corporation. Northwest IPPs...... Northwest Independent Power Producers Coalition (BP Energy; Calpine Corporation; EPCOR; National Energy Systems Company; Northwest Energy Development; Sempra Generation; Suez Energy North America, Inc.; and TransAlta Energy Marketing, (U.S.) Inc.). NRECA ...... National Rural Electric Cooperative Association. Occidental ...... Occidental Chemical Corporation. PacifiCorp ...... PacifiCorp. Powerex ...... Powerex Corp. Progress Energy...... Progress Energy, Inc. (Carolina Power & Light Company d/b/a Progress Energy Carolinas and Florida Power Corporation, d/b/a Progress Energy Florida). Puget ...... Puget Sound Energy, Inc. Sacramento ...... Sacramento Municipal Utility District. Salt River ...... Salt River Project Agricultural Improvement and Power District. San Antonio ...... San Antonio City Public Service Board. Seattle ...... City of Seattle—City Light Department. South Carolina Regulatory Staff ...... South Carolina Office of Regulatory Staff. Southern ...... Southern Company Services, Inc. TANC ...... Transmission Agency of Northern California. TAPS ...... Transmission Access Policy Study Group. TDU Systems ...... Transmission Dependent Utilities Systems. Truckee Donner ...... Truckee Donner Public Utility District. TVA ...... Tennessee Valley Authority. TVA Noticing Distributors+ ...... TVA Noticing Distributors (Paducah Power Systems, Glasgow Electric Plant Board, Princeton Electric Plant Board and Hopkinsville Electric System). Williams ...... Williams Power Company, Inc.

COMMENTERS IN RM05–17–000

Abbreviation RM05–17–000 Comments

Allegheny ...... Allegheny Power. APPA ...... American Public Power Association. Bonneville ...... Bonneville Power Administration. CEOB ...... California Electricity Oversight Board. EEI ...... Edison Electric Institute. EPSA ...... Electric Power Supply Association. Exelon ...... Exelon Corporation. FTC ...... Federal Trade Commission. Generator Coalition ...... Generator Coalition (Cottonwood Energy Company LP; KGen Power Management Inc.; Suez Energy North America, Inc.; and Union Power Partners, LP). International Transmission ...... International Transmission Company. ISO/RTO ...... ISO/RTO Council. LDWP ...... City of Los Angeles Department of Water and Power. MidAmerican ...... MidAmerican Energy Company. MISO ...... Midwest Independent Transmission System Operator, Inc. NERC ...... North American Electric Reliability Council. NY Commission ...... New York State Public Service Commission. PG&E ...... Pacific Gas and Electric Company. PGP ...... Public Generating Pool. Powerex ...... Powerex Corp. Southern ...... Southern Company Services, Inc. Southern California Edison ...... Southern California Edison Company.* TANC ...... Transmission Agency of Northern California. TAPS ...... Transmission Access Policy Study Group. WestConnect ...... WestConnect Public Utilities.

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Pro Forma Open Access Transmission 3.2 Reactive Supply and Voltage Control 15.6 Other Transmission Service Tariff from Generation Sources Service Schedules 3.3 Regulation and Frequency Response 15.7 Real Power Losses Table of Contents Service 16 Transmission Customer I. Common Service Provisions 3.4 Energy Imbalance Service Responsibilities 1 Definitions 3.5 Operating Reserve—Spinning Reserve 16.1 Conditions Required of 1.1 Affiliate Service Transmission Customers 1.2 Ancillary Services 3.6 Operating Reserve—Supplemental 16.2 Transmission Customer 1.3 Annual Transmission Costs Reserve Service Responsibility for Third-Party 1.4 Application 4 Open Access Same-Time Information Arrangements 1.5 Commission System (OASIS) 17 Procedures for Arranging Firm Point- 1.6 Completed Application 5 Local Furnishing Bonds To-Point Transmission Service 1.7 Control Area 5.1 Transmission Providers That Own 17.1 Application 1.8 Curtailment Facilities Financed by Local Furnishing 17.2 Completed Application Bonds 1.9 Delivering Party 17.3 Deposit 5.2 Alternative Procedures for Requesting 1.10 Designated Agent 17.4 Notice of Deficient Application Transmission Service 1.11 Direct Assignment Facilities 17.5 Response to a Completed 1.12 Economy Energy 6 Reciprocity 7 Billing and Payment Application 1.13 Eligible Customer 17.6 Execution of Service Agreement 1.14 Facilities Study 7.1 Billing Procedure 17.7 Extensions for Commencement of 1.15 Firm Point-To-Point Transmission 7.2 Interest on Unpaid Balances Service Service 7.3 Customer Default 1.16 Good Utility Practice 8 Accounting for the Transmission 18 Procedures for Arranging Non-Firm 1.17 Interruption Provider’s Use of the Tariff Point-To-Point Transmission Service 1.18 Load Ratio Share 8.1 Transmission Revenues 18.1 Application 1.19 Load Shedding 8.2 Study Costs and Revenues 18.2 Completed Application 1.20 Long-Term Firm Point-To-Point 9 Regulatory Filings 18.3 Reservation of Non-Firm Point-To- Transmission Service 10 Force Majeure and Indemnification Point Transmission Service 1.21 Native Load Customers 10.1 Force Majeure 18.4 Determination of Available Transfer 1.22 Network Customer 10.2 Indemnification Capability 1.23 Network Integration Transmission 11 Creditworthiness 19 Additional Study Procedures for Firm Service 12 Dispute Resolution Procedures Point-To-Point Transmission Service 1.24 Network Load 12.1 Internal Dispute Resolution Requests 1.25 Network Operating Agreement Procedures 19.1 Notice of Need for System Impact 1.26 Network Operating Committee 12.2 External Arbitration Procedures Study 1.27 Network Resource 12.3 Arbitration Decisions 19.2 System Impact Study Agreement and 1.28 Network Upgrades 12.4 Costs Cost Reimbursement 1.29 Non-Firm Point-To-Point 12.5 Rights Under The Federal Power Act 19.3 System Impact Study Procedures Transmission Service II. Point-To-Point Transmission Service 19.4 Facilities Study Procedures 1.30 Non-Firm Sale 13 Nature of Firm Point-to-Point 19.5 Facilities Study Modifications 1.31 Open Access Same-Time Transmission Service 19.6 Due Diligence in Completing New Information System (OASIS) 13.1 Term Facilities 1.32 Part I 13.2 Reservation Priority 19.7 Partial Interim Service 1.33 Part II 13.3 Use of Firm Transmission Service by 19.8 Expedited Procedures for New the Transmission Provider 1.34 Part III Facilities 13.4 Service Agreements 1.35 Parties 19.9 Penalties for Failure to Meet Study 13.5 Transmission Customer Obligations 1.36 Point(s) of Delivery Deadlines 1.37 Point(s) of Receipt for Facility Additions or Redispatch Costs 20 Procedures if the Transmission 1.38 Point-To-Point Transmission Service Provider is Unable to Complete New 1.39 Power Purchaser 13.6 Curtailment of Firm Transmission Transmission Facilities for Firm Point- 1.40 Pre-Confirmed Application Service to-Point Transmission Service 1.41 Receiving Party 13.7 Classification of Firm Transmission 1.42 Regional Transmission Group (RTG) Service 20.1 Delays in Construction of New 1.43 Reserved Capacity 13.8 Scheduling of Firm Point-To-Point Facilities 1.44 Service Agreement Transmission Service 20.2 Alternatives to the Original Facility 1.45 Service Commencement Date 14 Nature of Non-Firm Point-To-Point Additions 1.46 Short-Term Firm Point-To-Point Transmission Service 20.3 Refund Obligation for Unfinished Transmission Service 14.1 Term Facility Additions 1.47 System Impact Study 14.2 Reservation Priority 21 Provisions Relating to Transmission 1.48 Third-Party Sale 14.3 Use of Non-Firm Point-to-Point Construction and Services on the 1.49 Transmission Customer Transmission Service by the Systems of Other Utilities 1.50 Transmission Provider Transmission Provider 21.1 Responsibility for Third-Party 1.51 Transmission Provider’s Monthly 14.4 Service Agreements System Additions Transmission System Peak 14.5 Classification of Non-Firm Point-To- 21.2 Coordination of Third-Party System 1.52 Transmission Service Point Transmission Service Additions 1.53 Transmission System 14.6 Scheduling of Non-Firm Point-To- 22 Changes in Service Specifications 2 Initial Allocation and Renewal Point Transmission Service 22.1 Modifications on a Non-Firm Basis Procedures 14.7 Curtailment or Interruption of 22.2 Modification on a Firm Basis 2.1 Initial Allocation of Available Service 23 Sale or Assignment of Transmission Transfer Capability 15 Service Availability Service 2.2 Reservation Priority for Existing Firm Determination of Available Transfer 23.1 Procedures for Assignment or Service Customers Capability Transfer of Service 3 Ancillary Services 15.3 Initiating Service in the Absence of 23.2 Limitations on Assignment or 3.1 Scheduling, System Control and an Executed Service Agreement Transfer of Service Dispatch Service 15.4 Obligation to Provide Transmission 23.3 Information on Assignment or Service that Requires Expansion or Transfer of Service 451 A ‘‘∂’’ indicates that the commenter also filed Modification of the Transmission System 24 Metering and Power Factor Correction supplemental comments. 15.5 Deferral of Service at Receipt and Delivery Point(s)

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24.1 Transmission Customer Obligations 33.5 Allocation of Curtailments I. Common Service Provisions 24.2 Transmission Provider Access to 33.6 Load Shedding Metering Data 33.7 System Reliability 1 Definitions 24.3 Power Factor 34 Rates and Charges 1.1 Affiliate 25 Compensation for Transmission 34.1 Monthly Demand Charge Service 34.2 Determination of Network With respect to a corporation, 26 Stranded Cost Recovery Customer’s Monthly Network Load partnership or other entity, each such 27 Compensation for New Facilities and 34.3 Determination of Transmission other corporation, partnership or other Redispatch Costs Provider’s Monthly Transmission System entity that directly or indirectly, III. Network Integration Transmission Service Load 28 Nature of Network Integration through one or more intermediaries, 34.4 Redispatch Charge controls, is controlled by, or is under Transmission Service 34.5 Stranded Cost Recovery 28.1 Scope of Service 35 Operating Arrangements common control with, such corporation, 28.2 Transmission Provider 35.1 Operation Under the Network partnership or other entity. Responsibilities Operating Agreement 1.2 Ancillary Services 28.3 Network Integration Transmission 35.2 Network Operating Agreement Service 35.3 Network Operating Committee Those services that are necessary to 28.4 Secondary Service Schedule 1 support the transmission of capacity 28.5 Real Power Losses Scheduling, System Control and Dispatch and energy from resources to loads 28.6 Restrictions on Use of Service Service 29 Initiating Service while maintaining reliable operation of Schedule 2 29.1 Condition Precedent for Receiving the Transmission Provider’s Reactive Supply and Voltage Control From Service Transmission System in accordance Generation Sources Service 29.2 Application Procedures with Good Utility Practice. Schedule 3 29.3 Technical Arrangements to be Regulation and Frequency Response Completed Prior to Commencement of 1.3 Annual Transmission Costs Service Service Schedule 4 The total annual cost of the 29.4 Network Customer Facilities Energy Imbalance Service Transmission System for purposes of 29.5 Filing of Service Agreement Schedule 5 Network Integration Transmission 30 Network Resources Operating Reserve—Spinning Reserve 30.1 Designation of Network Resources Service shall be the amount specified in 30.2 Designation of New Network Service Attachment H until amended by the Resources Schedule 6 Transmission Provider or modified by 30.3 Termination of Network Resources Operating Reserve—Supplemental Reserve the Commission. 30.4 Operation of Network Resources Service 30.5 Network Customer Redispatch Schedule 7 1.4 Application Long-Term Firm and Short-Term Firm Obligation A request by an Eligible Customer for 30.6 Transmission Arrangements for Point-To-Point Schedule 8 transmission service pursuant to the Network Resources Not Physically provisions of the Tariff. Interconnected With the Transmission Non-Firm Point-To-Point Transmission Provider Service 1.5 Commission 30.7 Limitation on Designation of Schedule 9 Network Resources Generator Imbalance Service The Federal Energy Regulatory 30.8 Use of Interface Capacity by the Attachment A Commission. Form of Service Agreement for Firm Point- Network Customer 1.6 Completed Application 30.9 Network Customer Owned To-Point Transmission Service Transmission Facilities Attachment B An Application that satisfies all of the 31 Designation of Network Load Form of Service Agreement for Non-Firm information and other requirements of 31.1 Network Load Point-to-Point Transmission Service the Tariff, including any required Attachment C 31.2 New Network Loads Connected With deposit. the Transmission Provider Methodology To Assess Available Transfer 31.3 Network Load Not Physically Capability 1.7 Control Area Interconnected With the Transmission Attachment D Provider Methodology for Completing a System An electric power system or 31.4 New Interconnection Points Impact Study combination of electric power systems 31.5 Changes in Service Requests Attachment E to which a common automatic 31.6 Annual Load and Resource Index of Point-To-Point Transmission generation control scheme is applied in Information Updates Service Customers order to: 32 Additional Study Procedures for Attachment F 1. Match, at all times, the power Network Integration Transmission Service Agreement for Network Integration output of the generators within the Transmission Service Service Requests electric power system(s) and capacity 32.1 Notice of Need for System Impact Attachment G Study Network Operating Agreement and energy purchased from entities 32.2 System Impact Study Agreement and Attachment H outside the electric power system(s), Cost Reimbursement Annual Transmission Revenue with the load within the electric power 32.3 System Impact Study Procedures Requirement for Network Integration system(s); 32.4 Facilities Study Procedures Transmission Service 2. Maintain scheduled interchange 32.5 Penalties for Failure to Meet Study Attachment I with other Control Areas, within the Deadlines Index of Network Integration Transmission limits of Good Utility Practice; 33 Load Shedding and Curtailments Service Customers 3. Maintain the frequency of the Attachment J 33.1 Procedures electric power system(s) within 33.2 Transmission Constraints Procedures for Addressing Parallel Flows 33.3 Cost Responsibility for Relieving Attachment K reasonable limits in accordance with Transmission Constraints Transmission Planning Process Good Utility Practice; and 33.4 Curtailments of Scheduled Attachment L 4. Provide sufficient generating Deliveries Creditworthiness Procedures capacity to maintain operating reserves

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in accordance with Good Utility Transmission Provider, is an Eligible 1.20 Long-Term Firm Point-To-Point Practice. Customer under the Tariff. Transmission Service 1.8 Curtailment 1.14 Facilities Study Firm Point-To-Point Transmission Service under Part II of the Tariff with A reduction in firm or non-firm An engineering study conducted by a term of one year or more. transmission service in response to a the Transmission Provider to determine transfer capability shortage as a result of the required modifications to the 1.21 Native Load Customers system reliability conditions. Transmission Provider’s Transmission The wholesale and retail power 1.9 Delivering Party System, including the cost and customers of the Transmission Provider scheduled completion date for such on whose behalf the Transmission The entity supplying capacity and modifications, that will be required to Provider, by statute, franchise, energy to be transmitted at Point(s) of provide the requested transmission regulatory requirement, or contract, has Receipt. service. undertaken an obligation to construct 1.10 Designated Agent 1.15 Firm Point-To-Point and operate the Transmission Provider’s Transmission Service system to meet the reliable electric Any entity that performs actions or needs of such customers. functions on behalf of the Transmission Transmission Service under this 1.22 Network Customer Provider, an Eligible Customer, or the Tariff that is reserved and/or scheduled Transmission Customer required under between specified Points of Receipt and An entity receiving transmission the Tariff. Delivery pursuant to Part II of this service pursuant to the terms of the 1.11 Direct Assignment Facilities Tariff. Transmission Provider’s Network Integration Transmission Service under 1.16 Good Utility Practice Facilities or portions of facilities that Part III of the Tariff. are constructed by the Transmission Any of the practices, methods and Provider for the sole use/benefit of a 1.23 Network Integration Transmission acts engaged in or approved by a particular Transmission Customer Service significant portion of the electric utility requesting service under the Tariff. industry during the relevant time The transmission service provided Direct Assignment Facilities shall be period, or any of the practices, methods under Part III of the Tariff. specified in the Service Agreement that and acts which, in the exercise of governs service to the Transmission 1.24 Network Load reasonable judgment in light of the facts Customer and shall be subject to known at the time the decision was The load that a Network Customer Commission approval. made, could have been expected to designates for Network Integration 1.12 Economy Energy accomplish the desired result at a Transmission Service under Part III of reasonable cost consistent with good the Tariff. The Network Customer’s Energy purchased by a Network business practices, reliability, safety and Network Load shall include all load Integration Transmission customer that expedition. Good Utility Practice is not served by the output of any Network displaces that customer’s own higher intended to be limited to the optimum Resources designated by the Network cost designated Network Resource(s) for practice, method, or act to the exclusion Customer. A Network Customer may the purpose of serving that customer’s of all others, but rather to be acceptable elect to designate less than its total load designated Network Load(s). practices, methods, or acts generally as Network Load but may not designate 1.13 Eligible Customer accepted in the region, including those only part of the load at a discrete Point practices required by Federal Power Act of Delivery. Where a Eligible Customer i. Any electric utility (including the section 215(a)(4). has elected not to designate a particular Transmission Provider and any power load at discrete points of delivery as marketer), Federal power marketing 1.17 Interruption Network Load, the Eligible Customer is agency, or any person generating responsible for making separate A reduction in non-firm transmission electric energy for sale for resale is an arrangements under Part II of the Tariff service due to economic reasons Eligible Customer under the Tariff. for any Point-To-Point Transmission pursuant to Section 14.7. Electric energy sold or produced by Service that may be necessary for such such entity may be electric energy 1.18 Load Ratio Share non-designated load. produced in the United States, Canada or Mexico. However, with respect to Ratio of a Transmission Customer’s 1.25 Network Operating Agreement transmission service that the Network Load to the Transmission An executed agreement that contains Commission is prohibited from ordering Provider’s total load computed in the terms and conditions under which by Section 212(h) of the Federal Power accordance with Sections 34.2 and 34.3 the Network Customer shall operate its Act, such entity is eligible only if the of the Network Integration Transmission facilities and the technical and service is provided pursuant to a state Service under Part III the Tariff and operational matters associated with the requirement that the Transmission calculated on a rolling twelve month implementation of Network Integration Provider offer the unbundled basis. Transmission Service under Part III of transmission service, or pursuant to a 1.19 Load Shedding the Tariff. voluntary offer of such service by the 1.26 Network Operating Committee Transmission Provider. The systematic reduction of system ii. Any retail customer taking demand by temporarily decreasing load A group made up of representatives unbundled transmission service in response to transmission system or from the Network Customer(s) and the pursuant to a state requirement that the area capacity shortages, system Transmission Provider established to Transmission Provider offer the instability, or voltage control coordinate operating criteria and other transmission service, or pursuant to a considerations under Part III of the technical considerations required for voluntary offer of such service by the Tariff. implementation of Network Integration

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Transmission Service under Part III of Provisions of Part I and appropriate Transmission Customer over the this Tariff. Schedules and Attachments. Transmission Provider’s Transmission System between the Point(s) of Receipt 1.27 Network Resource 1.35 Parties and the Point(s) of Delivery under Part Any designated generating resource The Transmission Provider and the II of the Tariff. Reserved Capacity shall owned, purchased or leased by a Transmission Customer receiving be expressed in terms of whole Network Customer under the Network service under the Tariff. megawatts on a sixty (60) minute Integration Transmission Service Tariff. 1.36 Point(s) of Delivery interval (commencing on the clock Network Resources do not include any hour) basis. resource, or any portion thereof, that is Point(s) on the Transmission committed for sale to third parties or Provider’s Transmission System where 1.44 Service Agreement otherwise cannot be called upon to meet capacity and energy transmitted by the The initial agreement and any the Network Customer’s Network Load Transmission Provider will be made amendments or supplements thereto on a non-interruptible basis. available to the Receiving Party under entered into by the Transmission Part II of the Tariff. The Point(s) of Customer and the Transmission 1.28 Network Upgrades Delivery shall be specified in the Provider for service under the Tariff. Modifications or additions to Service Agreement for Long-Term Firm transmission-related facilities that are Point-To-Point Transmission Service. 1.45 Service Commencement Date integrated with and support the 1.37 Point(s) of Receipt The date the Transmission Provider Transmission Provider’s overall begins to provide service pursuant to Transmission System for the general Point(s) of interconnection on the the terms of an executed Service benefit of all users of such Transmission Transmission Provider’s Transmission Agreement, or the date the Transmission System. System where capacity and energy will Provider begins to provide service in be made available to the Transmission accordance with Section 15.3 or Section 1.29 Non-Firm Point-To-Point Provider by the Delivering Party under 29.1 under the Tariff. Transmission Service Part II of the Tariff. The Point(s) of Point-To-Point Transmission Service Receipt shall be specified in the Service 1.46 Short-Term Firm Point-to-Point under the Tariff that is reserved and Agreement for Long-Term Firm Point-to- Transmission Service scheduled on an as-available basis and Point Transmission Service. Firm Point-To-Point Transmission is subject to Curtailment or Interruption 1.38 Point-To-Point Transmission Service under Part II of the Tariff with as set forth in Section 14.7 under Part Service a term of less than one year. II of this Tariff. Non-Firm Point-To- The reservation and transmission of 1.47 System Impact Study Point Transmission Service is available capacity and energy on either a firm or on a stand-alone basis for periods An assessment by the Transmission non-firm basis from the Point(s) of ranging from one hour to one month. Provider of (i) the adequacy of the Receipt to the Point(s) of Delivery under Transmission System to accommodate a 1.30 Non-Firm Sale Part II of the Tariff. request for either Firm Point-To-Point An energy sale for which receipt or 1.39 Power Purchaser Transmission Service or Network Integration Transmission Service and delivery may be interrupted for any The entity that is purchasing the (ii) whether any additional costs may be reason or no reason, without liability on capacity and energy to be transmitted incurred in order to provide the part of either the buyer or seller. under the Tariff. transmission service. 1.31 Open Access Same-Time 1.40 Pre-Confirmed Application Information System (OASIS) 1.48 Third-Party Sale An Application that commits the The information system and standards Transmission Customer to execute a Any sale for resale in interstate of conduct contained in Part 37 of the Service Agreement upon receipt of commerce to a Power Purchaser that is Commission’s regulations and all notification that the Transmission not designated as part of Network Load additional requirements implemented Provider can provide the requested under the Network Integration by subsequent Commission orders Transmission Service. Transmission Service. dealing with OASIS. 1.41 Receiving Party 1.49 Transmission Customer 1.32 Part I The entity receiving the capacity and Any Eligible Customer (or its Tariff Definitions and Common energy transmitted by the Transmission Designated Agent) that (i) executes a Service Provisions contained in Provider to Point(s) of Delivery. Service Agreement, or (ii) requests in Sections 2 through 12. writing that the Transmission Provider 1.42 Regional Transmission Group file with the Commission, a proposed 1.33 Part II (RTG) unexecuted Service Agreement to Tariff Sections 13 through 27 A voluntary organization of receive transmission service under Part pertaining to Point-To-Point transmission owners, transmission users II of the Tariff. This term is used in the Transmission Service in conjunction and other entities approved by the Part I Common Service Provisions to with the applicable Common Service Commission to efficiently coordinate include customers receiving Provisions of Part I and appropriate transmission planning (and expansion), transmission service under Part II and Schedules and Attachments. operation and use on a regional (and Part III of this Tariff. 1.34 Part III interregional) basis. 1.50 Transmission Provider Tariff Sections 28 through 35 1.43 Reserved Capacity The public utility (or its Designated pertaining to Network Integration The maximum amount of capacity Agent) that owns, controls, or operates Transmission Service in conjunction and energy that the Transmission facilities used for the transmission of with the applicable Common Service Provider agrees to transmit for the electric energy in interstate commerce

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and provides transmission service under pay the current just and reasonable rate, operator, it may be unable to provide the Tariff. as approved by the Commission, for some or all of the Ancillary Services. In such service. The existing firm service this case, the Transmission Provider can 1.51 Transmission Provider’s Monthly customer must provide notice to the fulfill its obligation to provide Ancillary Transmission System Peak Transmission Provider whether it will Services by acting as the Transmission The maximum firm usage of the exercise its right of first refusal no less Customer’s agent to secure these Transmission Provider’s Transmission than one year prior to the expiration Ancillary Services from the Control System in a calendar month. date of its transmission service Area operator. The Transmission 1.52 Transmission Service agreement. This transmission Customer may elect to (i) have the reservation priority for existing firm Transmission Provider act as its agent, Point-To-Point Transmission Service service customers is an ongoing right (ii) secure the Ancillary Services provided under Part II of the Tariff on that may be exercised at the end of all directly from the Control Area operator, a firm and non-firm basis. firm contract terms of five years or or (iii) secure the Ancillary Services 1.53 Transmission System longer. Service agreements subject to a (discussed in Schedules 3, 4, 5 and 6) right of first refusal entered into prior to The facilities owned, controlled or from a third party or by self-supply [the acceptance by the Commission of operated by the Transmission Provider when technically feasible. The the Transmission Provider’s Attachment that are used to provide transmission Transmission Provider shall specify the K], unless terminated, will become service under Part II and Part III of the rate treatment and all related terms and subject to the five year/one year Tariff. conditions in the event of an requirement on the first rollover date unauthorized use of Ancillary Services 2 Initial Allocation and Renewal after [the acceptance by the Commission by the Transmission Customer. Procedures of the Transmission Provider’s The specific Ancillary Services, prices Attachment K]. 2.1 Initial Allocation of Available and/or compensation methods are Transfer Capability 3 Ancillary Services described on the Schedules that are attached to and made a part of the For purposes of determining whether Ancillary Services are needed with Tariff. Three principal requirements existing capability on the Transmission transmission service to maintain apply to discounts for Ancillary Provider’s Transmission System is reliability within and among the Control Services provided by the Transmission adequate to accommodate a request for Areas affected by the transmission Provider in conjunction with its firm service under this Tariff, all service. The Transmission Provider is provision of transmission service as Completed Applications for new firm required to provide (or offer to arrange follows: (1) Any offer of a discount transmission service received during the with the local Control Area operator as made by the Transmission Provider initial sixty (60) day period discussed below), and the Transmission must be announced to all Eligible commencing with the effective date of Customer is required to purchase, the Customers solely by posting on the the Tariff will be deemed to have been following Ancillary Services (i) OASIS, (2) any customer-initiated filed simultaneously. A lottery system Scheduling, System Control and requests for discounts (including conducted by an independent party Dispatch, and (ii) Reactive Supply and requests for use by one’s wholesale shall be used to assign priorities for Voltage Control from Generation merchant or an affiliate’s use) must Completed Applications filed Sources. occur solely by posting on the OASIS, simultaneously. All Completed The Transmission Provider is and (3) once a discount is negotiated, Applications for firm transmission required to offer to provide (or offer to details must be immediately posted on service received after the initial sixty arrange with the local Control Area the OASIS. A discount agreed upon for (60) day period shall be assigned a operator as discussed below) the an Ancillary Service must be offered for priority pursuant to Section 13.2. following Ancillary Services only to the Transmission Customer serving load the same period to all Eligible 2.2 Reservation Priority For Existing within the Transmission Provider’s Customers on the Transmission Firm Service Customers Control Area (i) Regulation and Provider’s system. Sections 3.1 through Existing firm service customers Frequency Response, (ii) Energy 3.6 below list the six Ancillary Services. (wholesale requirements and Imbalance, (iii) Operating Reserve— 3.1 Scheduling, System Control and transmission-only, with a contract term Spinning, and (iv) Operating Reserve— Dispatch Service of five years or more), have the right to Supplemental. The Transmission The rates and/or methodology are continue to take transmission service Customer serving load within the described in Schedule 1. from the Transmission Provider when Transmission Provider’s Control Area is the contract expires, rolls over or is required to acquire these Ancillary 3.2 Reactive Supply and Voltage renewed. This transmission reservation Services, whether from the Control From Generation Sources priority is independent of whether the Transmission Provider, from a third Service existing customer continues to purchase party, or by self-supply. The The rates and/or methodology are capacity and energy from the Transmission Customer may not decline described in Schedule 2. Transmission Provider or elects to the Transmission Provider’s offer of purchase capacity and energy from Ancillary Services unless it 3.3 Regulation and Frequency another supplier. If at the end of the demonstrates that it has acquired the Response Service contract term, the Transmission Ancillary Services from another source. Where applicable the rates and/or Provider’s Transmission System cannot The Transmission Customer must list in methodology are described in Schedule accommodate all of the requests for its Application which Ancillary 3. transmission service, the existing firm Services it will purchase from the service customer must agree to accept a Transmission Provider. 3.4 Energy Imbalance Service contract term at least equal to the longer If the Transmission Provider is a Where applicable the rates and/or of a competing request by any new public utility providing transmission methodology are described in Schedule Eligible Customer or five years and to service but is not a Control Area 4.

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3.5 Operating Reserve—Spinning (ii) If the Eligible Customer thereafter to request transmission service under Reserve Service renews its request for the same the Tariff. If the Transmission Customer Where applicable the rates and/or transmission service referred to in (i) by does not own, control or operate methodology are described in Schedule tendering an application under Section transmission facilities, it must include 5. 211 of the Federal Power Act, the in its Application a sworn statement of Transmission Provider, within ten (10) one of its duly authorized officers or 3.6 Operating Reserve—Supplemental days of receiving a copy of the Section other representatives that the purpose of Reserve Service 211 application, will waive its rights to its Application is not to assist an Where applicable the rates and/or a request for service under Section Eligible Customer to avoid the methodology are described in Schedule 213(a) of the Federal Power Act and to requirements of this provision. 6. the issuance of a proposed order under Section 212(c) of the Federal Power Act. 7 Billing and Payment 4 Open Access Same-Time The Commission, upon receipt of the 7.1 Billing Procedure Information System (OASIS) Transmission Provider’s waiver of its Within a reasonable time after the first rights to a request for service under Terms and conditions regarding Open day of each month, the Transmission Section 213(a) of the Federal Power Act Access Same-Time Information System Provider shall submit an invoice to the and standards of conduct are set forth in and to the issuance of a proposed order under Section 212(c) of the Federal Transmission Customer for the charges 18 CFR 37 of the Commission’s for all services furnished under the regulations (Open Access Same-Time Power Act, shall issue an order under Section 211 of the Federal Power Act. Tariff during the preceding month. The Information System and Standards of invoice shall be paid by the Conduct for Public Utilities) and 18 CFR Upon issuance of the order under Section 211 of the Federal Power Act, Transmission Customer within twenty 38 of the Commission’s regulations (20) days of receipt. All payments shall (Business Practice Standards and the Transmission Provider shall be required to provide the requested be made in immediately available funds Communication Protocols for Public payable to the Transmission Provider, or Utilities). In the event available transfer transmission service in accordance with the terms and conditions of this Tariff. by wire transfer to a bank named by the capability as posted on the OASIS is Transmission Provider. insufficient to accommodate a request 6. Reciprocity for firm transmission service, additional 7.2 Interest on Unpaid Balances A Transmission Customer receiving studies may be required as provided by transmission service under this Tariff Interest on any unpaid amounts this Tariff pursuant to Sections 19 and agrees to provide comparable (including amounts placed in escrow) 32. transmission service that it is capable of shall be calculated in accordance with 5 Local Furnishing Bonds providing to the Transmission Provider the methodology specified for interest on similar terms and conditions over on refunds in the Commission’s 5.1 Transmission Providers That Own facilities used for the transmission of regulations at 18 CFR 35.19a(a)(2)(iii). Facilities Financed by Local Furnishing electric energy owned, controlled or Interest on delinquent amounts shall be Bonds operated by the Transmission Customer calculated from the due date of the bill This provision is applicable only to and over facilities used for the to the date of payment. When payments Transmission Providers that have transmission of electric energy owned, are made by mail, bills shall be financed facilities for the local controlled or operated by the considered as having been paid on the furnishing of electric energy with tax- Transmission Customer’s corporate date of receipt by the Transmission exempt bonds, as described in Section affiliates. A Transmission Customer that Provider. 142(f) of the Internal Revenue Code is a member of a power pool or Regional 7.3 Customer Default (‘‘local furnishing bonds’’). Transmission Group also agrees to Notwithstanding any other provision of provide comparable transmission In the event the Transmission this Tariff, the Transmission Provider service to the members of such power Customer fails, for any reason other than shall not be required to provide pool and Regional Transmission Group a billing dispute as described below, to transmission service to any Eligible on similar terms and conditions over make payment to the Transmission Customer pursuant to this Tariff if the facilities used for the transmission of Provider on or before the due date as provision of such transmission service electric energy owned, controlled or described above, and such failure of would jeopardize the tax-exempt status operated by the Transmission Customer payment is not corrected within thirty of any local furnishing bond(s) used to and over facilities used for the (30) calendar days after the finance the Transmission Provider’s transmission of electric energy owned, Transmission Provider notifies the facilities that would be used in controlled or operated by the Transmission Customer to cure such providing such transmission service. Transmission Customer’s corporate failure, a default by the Transmission affiliates. Customer shall be deemed to exist. 5.2 Alternative Procedures for This reciprocity requirement applies Upon the occurrence of a default, the Requesting Transmission Service not only to the Transmission Customer Transmission Provider may initiate a (i) If the Transmission Provider that obtains transmission service under proceeding with the Commission to determines that the provision of the Tariff, but also to all parties to a terminate service but shall not terminate transmission service requested by an transaction that involves the use of service until the Commission so Eligible Customer would jeopardize the transmission service under the Tariff, approves any such request. In the event tax-exempt status of any local including the power seller, buyer and of a billing dispute between the furnishing bond(s) used to finance its any intermediary, such as a power Transmission Provider and the facilities that would be used in marketer. This reciprocity requirement Transmission Customer, the providing such transmission service, it also applies to any Eligible Customer Transmission Provider will continue to shall advise the Eligible Customer that owns, controls or operates provide service under the Service within thirty (30) days of receipt of the transmission facilities that uses an Agreement as long as the Transmission Completed Application. intermediary, such as a power marketer, Customer (i) continues to make all

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payments not in dispute, and (ii) pays 10 Force Majeure and Indemnification designated representatives are unable to into an independent escrow account the resolve the dispute within thirty (30) 10.1 Force Majeure portion of the invoice in dispute, days [or such other period as the Parties pending resolution of such dispute. If An event of Force Majeure means any may agree upon] by mutual agreement, the Transmission Customer fails to meet act of God, labor disturbance, act of the such dispute may be submitted to these two requirements for continuation public enemy, war, insurrection, riot, arbitration and resolved in accordance of service, then the Transmission fire, storm or flood, explosion, breakage with the arbitration procedures set forth Provider may provide notice to the or accident to machinery or equipment, below. Transmission Customer of its intention any Curtailment, order, regulation or 12.2 External Arbitration Procedures to suspend service in sixty (60) days, in restriction imposed by governmental military or lawfully established civilian accordance with Commission policy. authorities, or any other cause beyond a Any arbitration initiated under the 8 Accounting for the Transmission Party’s control. A Force Majeure event Tariff shall be conducted before a single Provider’s Use of the Tariff does not include an act of negligence or neutral arbitrator appointed by the intentional wrongdoing. Neither the Parties. If the Parties fail to agree upon The Transmission Provider shall Transmission Provider nor the a single arbitrator within ten (10) days record the following amounts, as Transmission Customer will be of the referral of the dispute to outlined below. considered in default as to any arbitration, each Party shall choose one obligation under this Tariff if prevented arbitrator who shall sit on a three- 8.1 Transmission Revenues from fulfilling the obligation due to an member arbitration panel. The two Include in a separate operating event of Force Majeure. However, a arbitrators so chosen shall within revenue account or subaccount the Party whose performance under this twenty (20) days select a third arbitrator revenues it receives from Transmission Tariff is hindered by an event of Force to chair the arbitration panel. In either Service when making Third-Party Sales Majeure shall make all reasonable case, the arbitrators shall be under Part II of the Tariff. efforts to perform its obligations under knowledgeable in electric utility this Tariff. matters, including electric transmission 8.2 Study Costs and Revenues and bulk power issues, and shall not 10.2 Indemnification have any current or past substantial Include in a separate transmission The Transmission Customer shall at business or financial relationships with operating expense account or all times indemnify, defend, and save any party to the arbitration (except prior subaccount, costs properly chargeable to the Transmission Provider harmless arbitration). The arbitrator(s) shall expense that are incurred to perform from any and all damages, losses, provide each of the Parties an any System Impact Studies or Facilities claims, including claims and actions opportunity to be heard and, except as Studies which the Transmission relating to injury to or death of any otherwise provided herein, shall Provider conducts to determine if it person or damage to property, demands, generally conduct the arbitration in must construct new transmission suits, recoveries, costs and expenses, accordance with the Commercial facilities or upgrades necessary for its court costs, attorney fees, and all other Arbitration Rules of the American own uses, including making Third-Party obligations by or to third parties, arising Arbitration Association and any Sales under the Tariff; and include in a out of or resulting from the applicable Commission regulations or separate operating revenue account or Transmission Provider’s performance of Regional Transmission Group rules. subaccount the revenues received for its obligations under this Tariff on System Impact Studies or Facilities behalf of the Transmission Customer, 12.3 Arbitration Decisions Studies performed when such amounts except in cases of negligence or are separately stated and identified in intentional wrongdoing by the Unless otherwise agreed, the the Transmission Customer’s billing Transmission Provider. arbitrator(s) shall render a decision under the Tariff. within ninety (90) days of appointment 11 Creditworthiness and shall notify the Parties in writing of 9 Regulatory Filings The Transmission Provider will such decision and the reasons therefor. specify its Creditworthiness procedures The arbitrator(s) shall be authorized Nothing contained in the Tariff or any in Attachment L. only to interpret and apply the Service Agreement shall be construed as provisions of the Tariff and any Service 12 Dispute Resolution Procedures affecting in any way the right of the Agreement entered into under the Tariff Transmission Provider to unilaterally 12.1 Internal Dispute Resolution and shall have no power to modify or make application to the Commission for Procedures change any of the above in any manner. a change in rates, terms and conditions, Any dispute between a Transmission The decision of the arbitrator(s) shall be charges, classification of service, Service Customer and the Transmission final and binding upon the Parties, and Agreement, rule or regulation under Provider involving transmission service judgment on the award may be entered Section 205 of the Federal Power Act under the Tariff (excluding applications in any court having jurisdiction. The and pursuant to the Commission’s rules for rate changes or other changes to the decision of the arbitrator(s) may be and regulations promulgated Tariff, or to any Service Agreement appealed solely on the grounds that the thereunder. entered into under the Tariff, which conduct of the arbitrator(s), or the Nothing contained in the Tariff or any shall be presented directly to the decision itself, violated the standards Service Agreement shall be construed as Commission for resolution) shall be set forth in the Federal Arbitration Act affecting in any way the ability of any referred to a designated senior and/or the Administrative Dispute Party receiving service under the Tariff representative of the Transmission Resolution Act. The final decision of the to exercise its rights under the Federal Provider and a senior representative of arbitrator must also be filed with the Power Act and pursuant to the the Transmission Customer for Commission if it affects jurisdictional Commission’s rules and regulations resolution on an informal basis as rates, terms and conditions of service or promulgated thereunder. promptly as practicable. In the event the facilities.

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12.4 Costs tiebreaker, followed by the highest price 13.4 Service Agreements Each Party shall be responsible for its offered by the Eligible Customer, The Transmission Provider shall offer own costs incurred during the followed by the date and time of the a standard form Firm Point-To-Point arbitration process and for the following request. Transmission Service Agreement costs, if applicable: (iii) If the Transmission System (Attachment A) to an Eligible Customer 1. The cost of the arbitrator chosen by becomes oversubscribed, requests for when it submits a Completed the Party to sit on the three member longer term service may preempt Application for Long-Term Firm Point- panel and one half of the cost of the requests for shorter term service up to To-Point Transmission Service. The third arbitrator chosen; or the following deadlines: one hour before Transmission Provider shall offer a 2. One half the cost of the single the commencement of hourly service, standard form Firm Point-To-Point arbitrator jointly chosen by the Parties. one day before the commencement of Transmission Service Agreement 12.5 Rights Under the Federal Power daily service, one week before the (Attachment A) to an Eligible Customer Act commencement of weekly service, and when it first submits a Completed one month before the commencement of Application for Short-Term Firm Point- Nothing in this section shall restrict monthly service. Before the conditional To-Point Transmission Service pursuant the rights of any party to file a reservation deadline, if available to the Tariff. Executed Service Complaint with the Commission under transfer capability is insufficient to Agreements that contain the information relevant provisions of the Federal Power required under the Tariff shall be filed Act. satisfy all Applications, an Eligible Customer with a reservation for shorter with the Commission in compliance II. Point-To-Point Transmission Service term service has the right of first refusal with applicable Commission regulations. Preamble to match any longer term reservation before losing its reservation priority. A 13.5 Transmission Customer The Transmission Provider will longer term competing request for Short- provide Firm and Non-Firm Point-To- Obligations for Facility Additions or Term Firm Point-To-Point Transmission Redispatch Costs Point Transmission Service pursuant to Service will be granted if the Eligible the applicable terms and conditions of Customer with the right of first refusal In cases where the Transmission this Tariff. Point-To-Point Transmission does not agree to match the competing Provider determines that the Service is for the receipt of capacity and request within 24 hours (or earlier if Transmission System is not capable of energy at designated Point(s) of Receipt necessary to comply with the providing Firm Point-To-Point and the transfer of such capacity and scheduling deadlines provided in Transmission Service without (1) energy to designated Point(s) of section 13.8) from being notified by the degrading or impairing the reliability of Delivery. Transmission Provider of a longer-term service to Native Load Customers, 13 Nature of Firm Point-To-Point competing request for Short-Term Firm Network Customers and other Transmission Service Point-To-Point Transmission Service. Transmission Customers taking Firm After the conditional reservation Point-To-Point Transmission Service, or 13.1 Term deadline, service will commence (2) interfering with the Transmission The minimum term of Firm Point-To- pursuant to the terms of Part II of the Provider’s ability to meet prior firm Point Transmission Service shall be one Tariff. contractual commitments to others, the Transmission Provider will be obligated hour and the maximum term shall be (iv) Firm Point-To-Point Transmission specified in the Service Agreement. to expand or upgrade its Transmission Service will always have a reservation System pursuant to the terms of Section 13.2 Reservation Priority priority over Non-Firm Point-To-Point 15.4. The Transmission Customer must (i) Long-Term Firm Point-To-Point Transmission Service under the Tariff. agree to compensate the Transmission Transmission Service shall be available All Long-Term Firm Point-To-Point Provider for any necessary transmission on a first-come, first-served basis, i.e., in Transmission Service will have equal facility additions pursuant to the terms the chronological sequence in which reservation priority with Native Load of Section 27. To the extent the each Transmission Customer has Customers and Network Customers. Transmission Provider can relieve any requested service. However, Pre- Reservation priorities for existing firm system constraint more economically by Confirmed Applications for service will service customers are provided in redispatching the Transmission receive priority over earlier-submitted Section 2.2. Provider’s resources than through requests that are not Pre-Confirmed. 13.3 Use of Firm Transmission Service constructing Network Upgrades, it shall Within classes of requests (Pre- by the Transmission Provider do so, provided that the Eligible Confirmed or not confirmed), the Customer agrees to compensate the highest price offered by the Eligible The Transmission Provider will be Transmission Provider pursuant to the Customer is the first tiebreaker, subject to the rates, terms and terms of Section 27. Any redispatch, followed by the date and time of the conditions of Part II of the Tariff when Network Upgrade or Direct Assignment request. making Third-Party Sales under (i) Facilities costs to be charged to the (ii) Reservations for Short-Term Firm agreements executed on or after August Transmission Customer on an Point-To-Point Transmission Service 7, 2006 or (ii) agreements executed prior incremental basis under the Tariff will will be conditional based upon the to the aforementioned date that the be specified in the Service Agreement length of the requested transaction. Commission requires to be unbundled, prior to initiating service. However, Pre-Confirmed Applications by the date specified by the for Short-Term Point-To-Point Commission. The Transmission 13.6 Curtailment of Firm Transmission Transmission Service will receive Provider will maintain separate Service priority over earlier-submitted requests accounting, pursuant to Section 8, for In the event that a Curtailment on the that are not Pre-Confirmed. Within any use of the Point-To-Point Transmission Provider’s Transmission classes of requests (Pre-Confirmed or Transmission Service to make Third- System, or a portion thereof, is required not confirmed), duration is the first Party Sales. to maintain reliable operation of such

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system and the system directly and (c) The Transmission Provider shall consistently adhered to by the indirectly interconnected with provide firm deliveries of capacity and Transmission Provider]. Transmission Transmission Provider’s Transmission energy from the Point(s) of Receipt to Customers within the Transmission system. Curtailments will be made on a the Point(s) of Delivery. Each Point of Provider’s service area with multiple non-discriminatory basis to the Receipt at which firm transmission requests for Transmission Service at a transaction(s) that effectively relieve the capacity is reserved by the Transmission Point of Receipt, each of which is under constraint. Transmission Provider may Customer shall be set forth in the Firm 1,000 kW per hour, may consolidate elect to implement such Curtailments Point-To-Point Service Agreement for their service requests at a common point pursuant to the Transmission Loading Long-Term Firm Transmission Service of receipt into units of 1,000 kW per Relief procedures specified in along with a corresponding capacity hour for scheduling and billing Attachment J. If multiple transactions reservation associated with each Point purposes. Transmission customers may require Curtailment, to the extent of Receipt. Points of Receipt and also batch requests and schedules for practicable and consistent with Good corresponding capacity reservations hourly firm service to be provided on Utility Practice, the Transmission shall be as mutually agreed upon by the the same day. Scheduling changes will Provider will curtail service to Network Parties for Short-Term Firm be permitted up to twenty (20) minutes Customers and Transmission Customers Transmission. Each Point of Delivery at [or a reasonable time that is generally taking Firm Point-To-Point which firm transfer capability is accepted in the region and is Transmission Service on a basis reserved by the Transmission Customer consistently adhered to by the comparable to the curtailment of service shall be set forth in the Firm Point-To- Transmission Provider] before the start to the Transmission Provider’s Native Point Service Agreement for Long-Term of the next clock hour provided that the Load Customers. All Curtailments will Firm Transmission Service along with a Delivering Party and Receiving Party be made on a non-discriminatory basis, corresponding capacity reservation also agree to the schedule modification. however, Non-Firm Point-To-Point associated with each Point of Delivery. The Transmission Provider will furnish Transmission Service shall be Points of Delivery and corresponding to the Delivering Party’s system subordinate to Firm Transmission capacity reservations shall be as operator, hour-to-hour schedules equal Service. When the Transmission mutually agreed upon by the Parties for to those furnished by the Receiving Provider determines that an electrical Short-Term Firm Transmission. The Party (unless reduced for losses) and emergency exists on its Transmission greater of either (1) the sum of the shall deliver the capacity and energy System and implements emergency capacity reservations at the Point(s) of provided by such schedules. Should the procedures to Curtail Firm Receipt, or (2) the sum of the capacity Transmission Customer, Delivering Transmission Service, the Transmission reservations at the Point(s) of Delivery Party or Receiving Party revise or Customer shall make the required shall be the Transmission Customer’s terminate any schedule, such party shall reductions upon request of the Reserved Capacity. The Transmission immediately notify the Transmission Transmission Provider. However, the Customer will be billed for its Reserved Provider, and the Transmission Provider Transmission Provider reserves the right Capacity under the terms of Schedule 7. shall have the right to adjust to Curtail, in whole or in part, any Firm The Transmission Customer may not accordingly the schedule for capacity Transmission Service provided under exceed its firm capacity reserved at each and energy to be received and to be the Tariff when, in the Transmission Point of Receipt and each Point of delivered. Provider’s sole discretion, an emergency Delivery except as otherwise specified or other unforeseen condition impairs or in Section 22. The Transmission 14 Nature of Non-Firm Point-To-Point degrades the reliability of its Provider shall specify the rate treatment Transmission Service Transmission System. The Transmission and all related terms and conditions 14.1 Term Provider will notify all affected applicable in the event that a Transmission Customers in a timely Transmission Customer (including Non-Firm Point-To-Point manner of any scheduled Curtailments. Third-Party Sales by the Transmission Transmission Service will be available Provider) exceeds its firm reserved for periods ranging from one (1) hour to 13.7 Classification of Firm capacity at any Point of Receipt or Point one (1) month. However, a Purchaser of Transmission Service of Delivery or uses Transmission Non-Firm Point-To-Point Transmission (a) The Transmission Customer taking Service at a Point of Receipt or Point of Service will be entitled to reserve a Firm Point-To-Point Transmission Delivery that it has not reserved. sequential term of service (such as a Service may (1) change its Receipt and sequential monthly term without having Delivery Points to obtain service on a 13.8 Scheduling of Firm Point-To- to wait for the initial term to expire non-firm basis consistent with the terms Point Transmission Service before requesting another monthly term) of Section 22.1 or (2) request a Schedules for the Transmission so that the total time period for which modification of the Points of Receipt or Customer’s Firm Point-To-Point the reservation applies is greater than Delivery on a firm basis pursuant to the Transmission Service must be submitted one month, subject to the requirements terms of Section 22.2. to the Transmission Provider no later of Section 18.3. (b) The Transmission Customer may than 10 a.m. [or a reasonable time that purchase transmission service to make is generally accepted in the region and 14.2 Reservation Priority sales of capacity and energy from is consistently adhered to by the Non-Firm Point-To-Point multiple generating units that are on the Transmission Provider] of the day prior Transmission Service shall be available Transmission Provider’s Transmission to commencement of such service. from transfer capability in excess of that System. For such a purchase of Schedules submitted after 10 a.m. will needed for reliable service to Native transmission service, the resources will be accommodated, if practicable. Hour- Load Customers, Network Customers be designated as multiple Points of to-hour schedules of any capacity and and other Transmission Customers Receipt, unless the multiple generating energy that is to be delivered must be taking Long-Term and Short-Term Firm units are at the same generating plant in stated in increments of 1,000 kW per Point-To-Point Transmission Service. A which case the units would be treated hour [or a reasonable increment that is higher priority will be assigned first to as a single Point of Receipt. generally accepted in the region and is Pre-Confirmed Applications and second

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to reservations with a longer duration of Commission in compliance with also agree to the schedule modification. service. In the event the Transmission applicable Commission regulations. The Transmission Provider will furnish System is constrained, competing to the Delivering Party’s system 14.5 Classification of Non-Firm Point- requests of the same Pre-Confirmation operator, hour-to-hour schedules equal To-Point Transmission Service status and equal duration will be to those furnished by the Receiving prioritized based on the highest price Non-Firm Point-To-Point Party (unless reduced for losses) and offered by the Eligible Customer for the Transmission Service shall be offered shall deliver the capacity and energy Transmission Service. Eligible under terms and conditions contained provided by such schedules. Should the Customers that have already reserved in Part II of the Tariff. The Transmission Transmission Customer, Delivering shorter term service have the right of Provider undertakes no obligation under Party or Receiving Party revise or first refusal to match any longer term the Tariff to plan its Transmission terminate any schedule, such party shall reservation before being preempted. A System in order to have sufficient immediately notify the Transmission longer term competing request for Non- capacity for Non-Firm Point-To-Point Provider, and the Transmission Provider Firm Point-To-Point Transmission Transmission Service. Parties requesting shall have the right to adjust Service will be granted if the Eligible Non-Firm Point-To-Point Transmission accordingly the schedule for capacity Customer with the right of first refusal Service for the transmission of firm and energy to be received and to be does not agree to match the competing power do so with the full realization delivered. request: (a) Immediately for hourly Non- that such service is subject to availability and to Curtailment or 14.7 Curtailment or Interruption of Firm Point-To-Point Transmission Service Service after notification by the Interruption under the terms of the Transmission Provider; and, (b) within Tariff. The Transmission Provider shall The Transmission Provider reserves 24 hours (or earlier if necessary to specify the rate treatment and all related the right to Curtail, in whole or in part, comply with the scheduling deadlines terms and conditions applicable in the Non-Firm Point-To-Point Transmission provided in section 14.6) for Non-Firm event that a Transmission Customer Service provided under the Tariff for Point-To-Point Transmission Service (including Third-Party Sales by the reliability reasons when, an emergency other than hourly transactions after Transmission Provider) exceeds its non- or other unforeseen condition threatens notification by the Transmission firm capacity reservation. Non-Firm to impair or degrade the reliability of its Provider. Transmission service for Point-To-Point Transmission Service Transmission System or the systems shall include transmission of energy on directly and indirectly interconnected Network Customers from resources an hourly basis and transmission of with Transmission Provider’s other than designated Network scheduled short-term capacity and Transmission System. Transmission Resources will have a higher priority energy on a daily, weekly or monthly Provider may elect to implement such than any Non-Firm Point-To-Point basis, but not to exceed one month’s Curtailments pursuant to the Transmission Service. Non-Firm Point- reservation for any one Application, Transmission Loading Relief procedures To-Point Transmission Service over under Schedule 8. specified in Attachment J. The secondary Point(s) of Receipt and Transmission Provider reserves the right Point(s) of Delivery will have the lowest 14.6 Scheduling of Non-Firm Point- to Interrupt, in whole or in part, Non- reservation priority under the Tariff. To-Point Transmission Service Firm Point-To-Point Transmission 14.3 Use of Non-Firm Point-To-Point Schedules for Non-Firm Point-To- Service provided under the Tariff for Transmission Service by the Point Transmission Service must be economic reasons in order to Transmission Provider submitted to the Transmission Provider accommodate (1) a request for Firm no later than 2 p.m. [or a reasonable Transmission Service, (2) a request for The Transmission Provider will be time that is generally accepted in the Non-Firm Point-To-Point Transmission subject to the rates, terms and region and is consistently adhered to by Service of greater duration, (3) a request conditions of Part II of the Tariff when the Transmission Provider] of the day for Non-Firm Point-To-Point making Third-Party Sales under (i) prior to commencement of such service. Transmission Service of equal duration agreements executed on or after August Schedules submitted after 2 p.m. will be with a higher price, or (4) transmission 7, 2006 or (ii) agreements executed prior accommodated, if practicable. Hour-to- service for Network Customers from to the aforementioned date that the hour schedules of energy that is to be non-designated resources. The Commission requires to be unbundled, delivered must be stated in increments Transmission Provider also will by the date specified by the of 1,000 kW per hour [or a reasonable discontinue or reduce service to the Commission. The Transmission increment that is generally accepted in Transmission Customer to the extent Provider will maintain separate the region and is consistently adhered to that deliveries for transmission are accounting, pursuant to Section 8, for by the Transmission Provider]. discontinued or reduced at the Point(s) any use of Non-Firm Point-To-Point Transmission Customers within the of Receipt. Where required, Transmission Service to make Third- Transmission Provider’s service area Curtailments or Interruptions will be Party Sales. with multiple requests for Transmission made on a non-discriminatory basis to 14.4 Service Agreements Service at a Point of Receipt, each of the transaction(s) that effectively relieve which is under 1,000 kW per hour, may the constraint, however, Non-Firm The Transmission Provider shall offer consolidate their schedules at a Point-To-Point Transmission Service a standard form Non-Firm Point-To- common Point of Receipt into units of shall be subordinate to Firm Point Transmission Service Agreement 1,000 kW per hour. Scheduling changes Transmission Service. If multiple (Attachment B) to an Eligible Customer will be permitted up to twenty (20) transactions require Curtailment or when it first submits a Completed minutes [or a reasonable time that is Interruption, to the extent practicable Application for Non-Firm Point-To- generally accepted in the region and is and consistent with Good Utility Point Transmission Service pursuant to consistently adhered to by the Practice, Curtailments or Interruptions the Tariff. Executed Service Agreements Transmission Provider] before the start will be made to transactions of the that contain the information required of the next clock hour provided that the shortest term (e.g., hourly non-firm under the Tariff shall be filed with the Delivering Party and Receiving Party transactions will be Curtailed or

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Interrupted before daily non-firm with the terms and conditions of the Transmission Provider is not obligated transactions and daily non-firm Tariff including posting appropriate to provide Real Power Losses. The transactions will be Curtailed or security deposits in accordance with the Transmission Customer is responsible Interrupted before weekly non-firm terms of Section 17.3. for replacing losses associated with all transactions). Transmission service for transmission service as calculated by 15.4 Obligation To Provide Network Customers from resources the Transmission Provider. The Transmission Service That Requires other than designated Network applicable Real Power Loss factors are Expansion or Modification of the Resources will have a higher priority as follows: [To be completed by the Transmission System than any Non-Firm Point-To-Point Transmission Provider]. Transmission Service under the Tariff. If the Transmission Provider 16 Transmission Customer Non-Firm Point-To-Point Transmission determines that it cannot accommodate Responsibilities Service over secondary Point(s) of a Completed Application for Firm Point- Receipt and Point(s) of Delivery will To-Point Transmission Service because 16.1 Conditions Required of have a lower priority than any Non-Firm of insufficient capability on its Transmission Customers Transmission System, the Transmission Point-To-Point Transmission Service Point-To-Point Transmission Service under the Tariff. The Transmission Provider will use due diligence to redispatch its own resources or expand shall be provided by the Transmission Provider will provide advance notice of Provider only if the following Curtailment or Interruption where such or modify its Transmission System to provide the requested Firm conditions are satisfied by the notice can be provided consistent with Transmission Customer: Good Utility Practice. Transmission Service, consistent with its planning obligations in Attachment (a) The Transmission Customer has 15 Service Availability K, provided the Transmission Customer pending a Completed Application for agrees to compensate the Transmission service; 15.1 General Conditions (b) The Transmission Customer meets Provider for such costs pursuant to the the creditworthiness criteria set forth in The Transmission Provider will terms of Section 27. The Transmission Section 11; provide Firm and Non-Firm Point-To- Provider will conform to Good Utility (c) The Transmission Customer will Point Transmission Service over, on or Practice and its planning obligations in have arrangements in place for any across its Transmission System to any Attachment K, in determining the need other transmission service necessary to Transmission Customer that has met the for new facilities and in the design and effect the delivery from the generating requirements of Section 16. construction of such facilities. The source to the Transmission Provider obligation applies only to those facilities 15.2 Determination of Available prior to the time service under Part II of that the Transmission Provider has the Transfer Capability the Tariff commences; right to expand or modify. To the extent A description of the Transmission (d) The Transmission Customer agrees a Transmission Provider cannot Provider’s specific methodology for to pay for any facilities constructed and redispatch its own resources to provide assessing available transfer capability chargeable to such Transmission the requested Firm Transmission posted on the Transmission Provider’s Customer under Part II of the Tariff, Service, it shall identify generators in OASIS (Section 4) is contained in whether or not the Transmission other control areas that could relieve the Attachment C of the Tariff. In the event Customer takes service for the full term constraint and allow the Transmission sufficient transfer capability may not of its reservation; Customer to seek redispatch with exist to accommodate a service request, (e) The Transmission Customer Transmission Providers in adjacent the Transmission Provider will respond provides the information required by Control Areas. by performing a System Impact Study. the Transmission Provider’s planning 15.5 Deferral of Service process established in Attachment K; 15.3 Initiating Service in the Absence and of an Executed Service Agreement The Transmission Provider may defer providing service until it completes (f) The Transmission Customer has If the Transmission Provider and the construction of new transmission executed a Point-To-Point Service Transmission Customer requesting Firm facilities or upgrades needed to provide Agreement or has agreed to receive or Non-Firm Point-To-Point Firm Point-To-Point Transmission service pursuant to Section 15.3. Transmission Service cannot agree on Service whenever the Transmission 16.2 Transmission Customer all the terms and conditions of the Provider determines that providing the Point-To-Point Service Agreement, the Responsibility for Third-Party requested service would, without such Arrangements Transmission Provider shall file with new facilities or upgrades, impair or the Commission, within thirty (30) days degrade reliability to any existing firm Any scheduling arrangements that after the date the Transmission services. may be required by other electric Customer provides written notification systems shall be the responsibility of the directing the Transmission Provider to 15.6 Other Transmission Service Transmission Customer requesting file, an unexecuted Point-To-Point Schedules service. The Transmission Customer Service Agreement containing terms and Eligible Customers receiving shall provide, unless waived by the conditions deemed appropriate by the transmission service under other Transmission Provider, notification to Transmission Provider for such agreements on file with the Commission the Transmission Provider identifying requested Transmission Service. The may continue to receive transmission such systems and authorizing them to Transmission Provider shall commence service under those agreements until schedule the capacity and energy to be providing Transmission Service subject such time as those agreements may be transmitted by the Transmission to the Transmission Customer agreeing modified by the Commission. Provider pursuant to Part II of the Tariff to (i) compensate the Transmission on behalf of the Receiving Party at the Provider at whatever rate the 15.7 Real Power Losses Point of Delivery or the Delivering Party Commission ultimately determines to be Real Power Losses are associated with at the Point of Receipt. However, the just and reasonable, and (ii) comply all transmission service. The Transmission Provider will undertake

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reasonable efforts to assist the judicial order, for reliability purposes Transmission Service, the deposit shall Transmission Customer in making such pursuant to Good Utility Practice or be refunded in full, with interest, less arrangements, including without pursuant to RTG transmission reasonable costs incurred by the limitation, providing any information or information sharing agreements. The Transmission Provider to the extent data required by such other electric Transmission Provider shall treat this such costs have not already been system pursuant to Good Utility information consistent with the recovered by the Transmission Provider Practice. standards of conduct contained in Part from the Eligible Customer. The 37 of the Commission’s regulations; Transmission Provider will provide to 17 Procedures for Arranging Firm (v) A description of the supply the Eligible Customer a complete Point-To-Point Transmission Service characteristics of the capacity and accounting of all costs deducted from 17.1 Application energy to be delivered; the refunded deposit, which the Eligible (vi) An estimate of the capacity and Customer may contest if there is a A request for Firm Point-To-Point energy expected to be delivered to the dispute concerning the deducted costs. Transmission Service for periods of one Receiving Party; Deposits associated with construction of year or longer must contain a written (vii) The Service Commencement Date new facilities are subject to the Application to: [Transmission Provider and the term of the requested provisions of Section 19. If a Service Name and Address], at least sixty (60) Transmission Service; Agreement for Firm Point-To-Point days in advance of the calendar month (viii) The transmission capacity Transmission Service is executed, the in which service is to commence. The requested for each Point of Receipt and deposit, with interest, will be returned Transmission Provider will consider each Point of Delivery on the to the Transmission Customer upon requests for such firm service on shorter Transmission Provider’s Transmission expiration or termination of the Service notice when feasible. Requests for firm System; customers may combine their Agreement for Firm Point-To-Point service for periods of less than one year requests for service in order to satisfy Transmission Service. Applicable shall be subject to expedited procedures the minimum transmission capacity interest shall be computed in that shall be negotiated between the requirement; accordance with the Commission’s Parties within the time constraints (ix) A statement indicating whether regulations at 18 CFR ? 35.19a(a)(2)(iii), provided in Section 17.5. All Firm the Transmission Customer commits to and shall be calculated from the day the Point-To-Point Transmission Service a Pre-Confirmed Request, i.e., will deposit check is credited to the requests should be submitted by execute a Service Agreement upon Transmission Provider’s account. entering the information listed below on receipt of notification that the the Transmission Provider’s OASIS. Transmission Provider can provide the 17.4 Notice of Deficient Application Prior to implementation of the requested Transmission Service; and If an Application fails to meet the Transmission Provider’s OASIS, a (x) Any additional information requirements of the Tariff, the Completed Application may be required by the Transmission Provider’s Transmission Provider shall notify the submitted by (i) transmitting the planning process established in entity requesting service within fifteen required information to the Attachment K. (15) days of receipt of the reasons for Transmission Provider by telefax, or (ii) The Transmission Provider shall treat such failure. The Transmission Provider providing the information by telephone this information consistent with the will attempt to remedy minor over the Transmission Provider’s time standards of conduct contained in Part deficiencies in the Application through recorded telephone line. Each of these 37 of the Commission’s regulations. informal communications with the methods will provide a time-stamped Eligible Customer. If such efforts are 17.3 Deposit record for establishing the priority of the unsuccessful, the Transmission Provider Application. A Completed Application for Firm shall return the Application, along with Point-To-Point Transmission Service any deposit, with interest. Upon receipt 17.2 Completed Application also shall include a deposit of either one of a new or revised Application that A Completed Application shall month’s charge for Reserved Capacity or fully complies with the requirements of provide all of the information included the full charge for Reserved Capacity for Part II of the Tariff, the Eligible in 18 CFR 2.20 including but not limited service requests of less than one month. Customer shall be assigned a new to the following: If the Application is rejected by the priority consistent with the date of the (i) The identity, address, telephone Transmission Provider because it does new or revised Application. number and facsimile number of the not meet the conditions for service as entity requesting service; set forth herein, or in the case of 17.5 Response to a Completed (ii) A statement that the entity requests for service arising in Application requesting service is, or will be upon connection with losing bidders in a Following receipt of a Completed commencement of service, an Eligible Request For Proposals (RFP), said Application for Firm Point-To-Point Customer under the Tariff; deposit shall be returned with interest Transmission Service, the Transmission (iii) The location of the Point(s) of less any reasonable costs incurred by Provider shall make a determination of Receipt and Point(s) of Delivery and the the Transmission Provider in available transmission capability as identities of the Delivering Parties and connection with the review of the losing required in Section 15.2. The the Receiving Parties; bidder’s Application. The deposit also Transmission Provider shall notify the (iv) The location of the generating will be returned with interest less any Eligible Customer as soon as practicable, facility(ies) supplying the capacity and reasonable costs incurred by the but not later than thirty (30) days after energy and the location of the load Transmission Provider if the the date of receipt of a Completed ultimately served by the capacity and Transmission Provider is unable to Application either (i) if it will be able energy transmitted. The Transmission complete new facilities needed to to provide service without performing a Provider will treat this information as provide the service. If an Application is System Impact Study or (ii) if such a confidential except to the extent that withdrawn or the Eligible Customer study is needed to evaluate the impact disclosure of this information is decides not to enter into a Service of the Application pursuant to Section required by this Tariff, by regulatory or Agreement for Firm Point-To-Point 19.1. Responses by the Transmission

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Provider must be made as soon as to the Transmission Provider. receipt of notification that the practicable to all completed Applications should be submitted by Transmission Provider can provide the applications (including applications by entering the information listed below on requested Transmission Service. its own merchant function) and the the Transmission Provider’s OASIS. 18.3 Reservation of Non-Firm Point- timing of such responses must be made Prior to implementation of the To-Point Transmission Service on a non-discriminatory basis. Transmission Provider’s OASIS, a Completed Application may be Requests for monthly service shall be 17.6 Execution of Service Agreement submitted by (i) transmitting the submitted no earlier than sixty (60) days Whenever the Transmission Provider required information to the before service is to commence; requests determines that a System Impact Study Transmission Provider by telefax, or (ii) for weekly service shall be submitted no is not required and that the service can providing the information by telephone earlier than fourteen (14) days before be provided, it shall notify the Eligible over the Transmission Provider’s time service is to commence, requests for Customer as soon as practicable but no recorded telephone line. Each of these daily service shall be submitted no later than thirty (30) days after receipt methods will provide a time-stamped earlier than two (2) days before service of the Completed Application. Where a record for establishing the service is to commence, and requests for hourly System Impact Study is required, the priority of the Application. service shall be submitted no earlier provisions of Section 19 will govern the than noon the day before service is to execution of a Service Agreement. 18.2 Completed Application commence. Requests for service Failure of an Eligible Customer to A Completed Application shall received later than 2:00 p.m. prior to the execute and return the Service provide all of the information included day service is scheduled to commence Agreement or request the filing of an in 18 CFR 2.20 including but not limited will be accommodated if practicable [or unexecuted service agreement pursuant to the following: such reasonable times that are generally to Section 15.3, within fifteen (15) days (i) The identity, address, telephone accepted in the region and are after it is tendered by the Transmission number and facsimile number of the consistently adhered to by the Provider will be deemed a withdrawal entity requesting service; Transmission Provider]. and termination of the Application and (ii) A statement that the entity 18.4 Determination of Available any deposit submitted shall be refunded requesting service is, or will be upon Transfer Capability with interest. Nothing herein limits the commencement of service, an Eligible right of an Eligible Customer to file Customer under the Tariff; Following receipt of a tendered another Application after such (iii) The Point(s) of Receipt and the schedule the Transmission Provider will withdrawal and termination. Point(s) of Delivery; make a determination on a non- (iv) The maximum amount of capacity discriminatory basis of available transfer 17.7 Extensions for Commencement of requested at each Point of Receipt and capability pursuant to Section 15.2. Service Point of Delivery; and Such determination shall be made as The Transmission Customer can (v) The proposed dates and hours for soon as reasonably practicable after obtain up to five (5) one-year extensions initiating and terminating transmission receipt, but not later than the following for the commencement of service. The service hereunder. time periods for the following terms of Transmission Customer may postpone In addition to the information service (i) thirty (30) minutes for hourly service by paying a non-refundable specified above, when required to service, (ii) thirty (30) minutes for daily annual reservation fee equal to one- properly evaluate system conditions, the service, (iii) four (4) hours for weekly month’s charge for Firm Transmission Transmission Provider also may ask the service, and (iv) two (2) days for Service for each year or fraction thereof. Transmission Customer to provide the monthly service. [Or such reasonable If during any extension for the following: times that are generally accepted in the commencement of service an Eligible (vi) The electrical location of the region and are consistently adhered to Customer submits a Completed initial source of the power to be by the Transmission Provider]. Application for Firm Transmission transmitted pursuant to the 19 Additional Study Procedures for Service, and such request can be Transmission Customer’s request for Firm Point-To-Point Transmission satisfied only by releasing all or part of service; and (vii) The electrical location of the Service Requests the Transmission Customer’s Reserved ultimate load. Capacity, the original Reserved Capacity 19.1 Notice of Need for System Impact The Transmission Provider will treat will be released unless the following Study this information in (vi) and (vii) as condition is satisfied. Within thirty (30) confidential at the request of the After receiving a request for service, days, the original Transmission Transmission Customer except to the the Transmission Provider shall Customer agrees to pay the Firm Point- extent that disclosure of this determine on a non-discriminatory basis To-Point transmission rate for its information is required by this Tariff, by whether a System Impact Study is Reserved Capacity concurrent with the regulatory or judicial order, for needed. A description of the new Service Commencement Date. In reliability purposes pursuant to Good Transmission Provider’s methodology the event the Transmission Customer Utility Practice, or pursuant to RTG for completing a System Impact Study is elects to release the Reserved Capacity, transmission information sharing provided in Attachment D. If the the reservation fees or portions thereof agreements. The Transmission Provider Transmission Provider determines that a previously paid will be forfeited. shall treat this information consistent System Impact Study is necessary to 18 Procedures for Arranging Non-Firm with the standards of conduct contained accommodate the requested service, it Point-To-Point Transmission Service in Part 37 of the Commission’s shall so inform the Eligible Customer, as regulations. soon as practicable. In such cases, the 18.1 Application (viii) A statement indicating whether Transmission Provider shall within Eligible Customers seeking Non-Firm the Transmission Customer commits to thirty (30) days of receipt of a Point-To-Point Transmission Service a Pre-Confirmed Request, i.e., will Completed Application, tender a System must submit a Completed Application execute a Service Agreement upon Impact Study Agreement pursuant to

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which the Eligible Customer shall agree event that the Transmission Provider is explanation of the reasons that to reimburse the Transmission Provider unable to complete the required System additional time is required to complete for performing the required System Impact Study within such time period, the study. When completed, the Impact Study. For a service request to it shall so notify the Eligible Customer Facilities Study will include a good remain a Completed Application, the and provide an estimated completion faith estimate of (i) the cost of Direct Eligible Customer shall execute the date along with an explanation of the Assignment Facilities to be charged to System Impact Study Agreement and reasons why additional time is required the Transmission Customer, (ii) the return it to the Transmission Provider to complete the required studies. A copy Transmission Customer’s appropriate within fifteen (15) days. If the Eligible of the completed System Impact Study share of the cost of any required Customer elects not to execute the and related work papers shall be made Network Upgrades as determined System Impact Study Agreement, its available to the Eligible Customer. The pursuant to the provisions of Part II of application shall be deemed withdrawn Transmission Provider will use the the Tariff, and (iii) the time required to and its deposit, pursuant to Section same due diligence in completing the complete such construction and initiate 17.3, shall be returned with interest. System Impact Study for an Eligible the requested service. The Transmission Customer as it uses when completing Customer shall provide the 19.2 System Impact Study Agreement studies for itself. The Transmission Transmission Provider with a letter of and Cost Reimbursement Provider shall notify the Eligible credit or other reasonable form of (i) The System Impact Study Customer immediately upon completion security acceptable to the Transmission Agreement will clearly specify the of the System Impact Study if the Provider equivalent to the costs of new Transmission Provider’s estimate of the Transmission System will be adequate facilities or upgrades consistent with actual cost, and time for completion of to accommodate all or part of a request commercial practices as established by the System Impact Study. The charge for service or that no costs are likely to the Uniform Commercial Code. The shall not exceed the actual cost of the be incurred for new transmission Transmission Customer shall have thirty study. In performing the System Impact facilities or upgrades. In order for a (30) days to execute a Service Study, the Transmission Provider shall request to remain a Completed Agreement or request the filing of an rely, to the extent reasonably Application, within fifteen (15) days of unexecuted Service Agreement and practicable, on existing transmission completion of the System Impact Study provide the required letter of credit or planning studies. The Eligible Customer the Eligible Customer must execute a other form of security or the request will will not be assessed a charge for such Service Agreement or request the filing no longer be a Completed Application existing studies; however, the Eligible of an unexecuted Service Agreement and shall be deemed terminated and Customer will be responsible for charges pursuant to Section 15.3, or the withdrawn. associated with any modifications to Application shall be deemed terminated existing planning studies that are and withdrawn. 19.5 Facilities Study Modifications reasonably necessary to evaluate the Any change in design arising from impact of the Eligible Customer’s 19.4 Facilities Study Procedures inability to site or construct facilities as request for service on the Transmission If a System Impact Study indicates proposed will require development of a System. that additions or upgrades to the revised good faith estimate. New good (ii) If in response to multiple Eligible Transmission System are needed to faith estimates also will be required in Customers requesting service in relation supply the Eligible Customer’s service the event of new statutory or regulatory to the same competitive solicitation, a request, the Transmission Provider, requirements that are effective before single System Impact Study is sufficient within thirty (30) days of the the completion of construction or other for the Transmission Provider to completion of the System Impact Study, circumstances beyond the control of the accommodate the requests for service, shall tender to the Eligible Customer a Transmission Provider that significantly the costs of that study shall be pro-rated Facilities Study Agreement pursuant to affect the final cost of new facilities or among the Eligible Customers. which the Eligible Customer shall agree upgrades to be charged to the (iii) For System Impact Studies that to reimburse the Transmission Provider Transmission Customer pursuant to the the Transmission Provider conducts on for performing the required Facilities provisions of Part II of the Tariff. its own behalf, the Transmission Study. For a service request to remain Provider shall record the cost of the a Completed Application, the Eligible 19.6 Due Diligence in Completing New System Impact Studies pursuant to Customer shall execute the Facilities Facilities Section 20. Study Agreement and return it to the The Transmission Provider shall use Transmission Provider within fifteen due diligence to add necessary facilities 19.3 System Impact Study Procedures (15) days. If the Eligible Customer elects or upgrade its Transmission System Upon receipt of an executed System not to execute the Facilities Study within a reasonable time. The Impact Study Agreement, the Agreement, its application shall be Transmission Provider will not upgrade Transmission Provider will use due deemed withdrawn and its deposit, its existing or planned Transmission diligence to complete the required pursuant to Section 17.3, shall be System in order to provide the System Impact Study within a sixty (60) returned with interest. Upon receipt of requested Firm Point-To-Point day period. The System Impact Study an executed Facilities Study Agreement, Transmission Service if doing so would shall identify any system constraints the Transmission Provider will use due impair system reliability or otherwise and redispatch options, including an diligence to complete the required impair or degrade existing firm service. estimate of the number of hours of Facilities Study within a sixty (60) day redispatch that may be required to period. If the Transmission Provider is 19.7 Partial Interim Service accommodate the request for unable to complete the Facilities Study If the Transmission Provider Transmission Service and a preliminary in the allotted time period, the determines that it will not have estimate of the cost of redispatch, Transmission Provider shall notify the adequate transfer capability to satisfy additional Direct Assignment Facilities Transmission Customer and provide an the full amount of a Completed or Network Upgrades required to estimate of the time needed to reach a Application for Firm Point-To-Point provide the requested service. In the final determination along with an Transmission Service, the Transmission

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Provider nonetheless shall be obligated within the 60-day study completion circumstances, the Transmission to offer and provide the portion of the deadlines. Such notice must be filed Provider shall within thirty (30) days of requested Firm Point-To-Point within thirty (30) days of the end of the notifying the Transmission Customer of Transmission Service that can be calendar quarter triggering the notice such delays, convene a technical accommodated without addition of any requirement. meeting with the Transmission facilities and through redispatch. (ii) For the purposes of calculating the Customer to evaluate the alternatives However, the Transmission Provider percent of non-Affiliates’ System Impact available to the Transmission Customer. shall not be obligated to provide the Studies and Facilities Studies processed The Transmission Provider also shall incremental amount of requested Firm outside of the 60-day study completion make available to the Transmission Point-To-Point Transmission Service deadlines, the Transmission Provider Customer studies and work papers that requires the addition of facilities or shall consider all System Impact Studies related to the delay, including all upgrades to the Transmission System and Facilities Studies that it completes information that is in the possession of until such facilities or upgrades have for non-Affiliates during the calendar the Transmission Provider that is been placed in service. quarter. The percentage should be reasonably needed by the Transmission Customer to evaluate any alternatives. 19.8 Expedited Procedures for New calculated by dividing the number of Facilities those studies which are completed on 20.2 Alternatives to the Original time by the total number of completed Facility Additions In lieu of the procedures set forth studies. The Transmission Provider may above, the Eligible Customer shall have provide an explanation in its When the review process of Section the option to expedite the process by notification filing to the Commission if 20.1 determines that one or more requesting the Transmission Provider to it believes there are extenuating alternatives exist to the originally tender at one time, together with the circumstances that prevented it from planned construction project, the results of required studies, an meeting the 60-day study completion Transmission Provider shall present ‘‘Expedited Service Agreement’’ deadlines. such alternatives for consideration by pursuant to which the Eligible Customer (iii) The Transmission Provider is the Transmission Customer. If, upon would agree to compensate the subject to an operational penalty if it review of any alternatives, the Transmission Provider for all costs completes ten (10) percent or more of Transmission Customer desires to incurred pursuant to the terms of the non-Affiliates’ System Impact Studies maintain its Completed Application Tariff. In order to exercise this option, and Facilities Studies outside of the 60- subject to construction of the alternative the Eligible Customer shall request in day study completion deadlines for each facilities, it may request the writing an expedited Service Agreement of the two calendar quarters Transmission Provider to submit a covering all of the above-specified items immediately following the quarter that revised Service Agreement for Firm within thirty (30) days of receiving the triggered its notification filing to the Point-To-Point Transmission Service. If results of the System Impact Study Commission. The operational penalty the alternative approach solely involves identifying needed facility additions or will be assessed for each calendar Non-Firm Point-To-Point Transmission upgrades or costs incurred in providing quarter for which an operational penalty Service, the Transmission Provider shall the requested service. While the applies, starting with the calendar promptly tender a Service Agreement Transmission Provider agrees to provide quarter immediately following the for Non-Firm Point-To-Point Transmission Service providing for the the Eligible Customer with its best quarter that triggered the Transmission service. In the event the Transmission estimate of the new facility costs and Provider’s notification filing to the Provider concludes that no reasonable other charges that may be incurred, such Commission. The operational penalty alternative exists and the Transmission estimate shall not be binding and the will continue to be assessed each Customer disagrees, the Transmission Eligible Customer must agree in writing quarter until the Transmission Provider Customer may seek relief under the to compensate the Transmission completes at least ninety (90) percent of dispute resolution procedures pursuant Provider for all costs incurred pursuant all non-Affiliates’ System Impact to Section 12 or it may refer the dispute to the provisions of the Tariff. The Studies and Facilities Studies within to the Commission for resolution. Eligible Customer shall execute and the 60-day deadline. return such an Expedited Service (iv) For penalties assessed in 20.3 Refund Obligation for Unfinished Agreement within fifteen (15) days of its accordance with subsection (iii) above, Facility Additions receipt or the Eligible Customer’s the penalty amount for each System request for service will cease to be a If the Transmission Provider and the Impact Study or Facilities Study shall Transmission Customer mutually agree Completed Application and will be be equal to $500 for each day the deemed terminated and withdrawn. that no other reasonable alternatives Transmission Provider takes to exist and the requested service cannot 19.9 Penalties for Failure To Meet complete that study beyond the 60-day be provided out of existing capability Study Deadlines deadline. under the conditions of Part II of the Sections 19.3 and 19.4 require a 20 Procedures if the Transmission Tariff, the obligation to provide the Transmission Provider to use due Provider Is Unable To Complete New requested Firm Point-To-Point diligence to meet 60-day study Transmission Facilities for Firm Point- Transmission Service shall terminate completion deadlines for System Impact To-Point Transmission Service and any deposit made by the Studies and Facilities Studies. Transmission Customer shall be (i) The Transmission Provider is 20.1 Delays in Construction of New returned with interest pursuant to required to file a notice with the Facilities Commission regulations Commission in the event that more than If any event occurs that will 35.19a(a)(2)(iii). However, the twenty (20) percent of non-Affiliates’ materially affect the time for completion Transmission Customer shall be System Impact Studies and Facilities of new facilities, or the ability to responsible for all prudently incurred Studies completed by the Transmission complete them, the Transmission costs by the Transmission Provider Provider in any two consecutive Provider shall promptly notify the through the time construction was calendar quarters are not completed Transmission Customer. In such suspended.

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21 Provisions Relating to Transmission specified in the Service Agreement Service Agreement, but only to another Construction and Services on the (‘‘Secondary Receipt and Delivery Eligible Customer (the Assignee). The Systems of Other Utilities Points’’), in amounts not to exceed its Transmission Customer that sells, firm capacity reservation, without 21.1 Responsibility for Third-Party assigns or transfers its rights under its incurring an additional Non-Firm Point- System Additions Service Agreement is hereafter referred To-Point Transmission Service charge or to as the Reseller. Compensation to The Transmission Provider shall not executing a new Service Agreement, Resellers that are Affiliates of the be responsible for making arrangements subject to the following conditions. Transmission Provider shall not exceed for any necessary engineering, (a) Service provided over Secondary the higher of (i) the original rate paid by permitting, and construction of Receipt and Delivery Points will be non- the Reseller, (ii) the Transmission transmission or distribution facilities on firm only, on an as-available basis and Provider’s maximum rate on file at the the system(s) of any other entity or for will not displace any firm or non-firm time of the assignment, or (iii) the obtaining any regulatory approval for service reserved or scheduled by third- Reseller’s opportunity cost capped at such facilities. The Transmission parties under the Tariff or by the the Transmission Provider’s cost of Provider will undertake reasonable Transmission Provider on behalf of its expansion. Compensation to Resellers efforts to assist the Transmission Native Load Customers. that are not Affiliates of the Customer in obtaining such (b) The sum of all Firm and non-firm arrangements, including without Point-To-Point Transmission Service Transmission Provider shall be at rates limitation, providing any information or provided to the Transmission Customer established by agreement with the data required by such other electric at any time pursuant to this section Assignee. If the Assignee does not system pursuant to Good Utility shall not exceed the Reserved Capacity request any change in the Point(s) of Practice. in the relevant Service Agreement under Receipt or the Point(s) of Delivery, or a change in any other term or condition 21.2 Coordination of Third-Party which such services are provided. (c) The Transmission Customer shall set forth in the original Service System Additions retain its right to schedule Firm Point- Agreement, the Assignee will receive In circumstances where the need for To-Point Transmission Service at the the same services as did the Reseller transmission facilities or upgrades is Receipt and Delivery Points specified in and the priority of service for the identified pursuant to the provisions of the relevant Service Agreement in the Assignee will be the same as that of the Part II of the Tariff, and if such upgrades amount of its original capacity Reseller. A Reseller should notify the further require the addition of reservation. Transmission Provider as soon as transmission facilities on other systems, (d) Service over Secondary Receipt possible after any assignment or transfer the Transmission Provider shall have and Delivery Points on a non-firm basis of service occurs but in any event, the right to coordinate construction on shall not require the filing of an notification must be provided prior to its own system with the construction Application for Non-Firm Point-To- any provision of service to the Assignee. required by others. The Transmission Point Transmission Service under the The Assignee will be subject to all terms Provider, after consultation with the Tariff. However, all other requirements and conditions of this Tariff. If the Transmission Customer and of Part II of the Tariff (except as to Assignee requests a change in service, representatives of such other systems, transmission rates) shall apply to the reservation priority of service will may defer construction of its new transmission service on a non-firm basis be determined by the Transmission transmission facilities, if the new over Secondary Receipt and Delivery Provider pursuant to Section 13.2. transmission facilities on another Points. system cannot be completed in a timely 23.2 Limitations on Assignment or manner. The Transmission Provider 22.2 Modification on a Firm Basis Transfer of Service shall notify the Transmission Customer Any request by a Transmission in writing of the basis for any decision Customer to modify Receipt and If the Assignee requests a change in to defer construction and the specific Delivery Points on a firm basis shall be the Point(s) of Receipt or Point(s) of problems which must be resolved before treated as a new request for service in Delivery, or a change in any other it will initiate or resume construction of accordance with Section 17 hereof, specifications set forth in the original new facilities. Within sixty (60) days of except that such Transmission Customer Service Agreement, the Transmission receiving written notification by the shall not be obligated to pay any Provider will consent to such change Transmission Provider of its intent to additional deposit if the capacity subject to the provisions of the Tariff, defer construction pursuant to this reservation does not exceed the amount provided that the change will not impair section, the Transmission Customer may reserved in the existing Service the operation and reliability of the challenge the decision in accordance Agreement. While such new request is Transmission Provider’s generation, with the dispute resolution procedures pending, the Transmission Customer transmission, or distribution systems. pursuant to Section 12 or it may refer shall retain its priority for service at the The Assignee shall compensate the the dispute to the Commission for existing firm Receipt and Delivery Transmission Provider for performing resolution. Points specified in its Service any System Impact Study needed to Agreement. 22 Changes in Service Specifications evaluate the capability of the 23 Sale or Assignment of Transmission Transmission System to accommodate 22.1 Modifications on a Non-Firm Service the proposed change and any additional Basis costs resulting from such change. The The Transmission Customer taking 23.1 Procedures for Assignment or Reseller shall remain liable for the Firm Point-To-Point Transmission Transfer of Service performance of all obligations under the Service may request the Transmission Subject to Commission approval of Service Agreement, except as Provider to provide transmission service any necessary filings, a Transmission specifically agreed to by the Parties on a non-firm basis over Receipt and Customer may sell, assign, or transfer all through an amendment to the Service Delivery Points other than those or a portion of its rights under its Agreement.

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23.3 Information on Assignment or charge under Section 205 of the Federal the Tariff. The Network Customer taking Transfer of Service Power Act. Network Integration Transmission Service must obtain or provide 27 Compensation for New Facilities In accordance with Section 4, Ancillary Services pursuant to Section and Redispatch Costs Resellers may use the Transmission 3. Provider’s OASIS to post transmission Whenever a System Impact Study capacity available for resale. performed by the Transmission Provider 28.2 Transmission Provider Responsibilities 24 Metering and Power Factor in connection with the provision of Correction at Receipt and Delivery Firm Point-To-Point Transmission The Transmission Provider will plan, Points(s) Service identifies the need for new construct, operate and maintain its facilities, the Transmission Customer Transmission System in accordance 24.1 Transmission Customer shall be responsible for such costs to the with Good Utility Practice and its Obligations extent consistent with Commission planning obligations in Attachment K in Unless otherwise agreed, the policy. Whenever a System Impact order to provide the Network Customer Transmission Customer shall be Study performed by the Transmission with Network Integration Transmission responsible for installing and Provider identifies capacity constraints Service over the Transmission maintaining compatible metering and that may be relieved more economically Provider’s Transmission System. The communications equipment to by redispatching the Transmission Transmission Provider, on behalf of its accurately account for the capacity and Provider’s resources than by building Native Load Customers, shall be energy being transmitted under Part II of new facilities or upgrading existing required to designate resources and loads in the same manner as any the Tariff and to communicate the facilities to eliminate such constraints, Network Customer under Part III of this information to the Transmission the Transmission Customer shall be Tariff. This information must be Provider. Such equipment shall remain responsible for the redispatch costs to consistent with the information used by the property of the Transmission the extent consistent with Commission the Transmission Provider to calculate Customer. policy. available transfer capability. The III. Network Integration Transmission 24.2 Transmission Provider Access to Transmission Provider shall include the Service Metering Data Network Customer’s Network Load in Preamble its Transmission System planning and The Transmission Provider shall have shall, consistent with Good Utility access to metering data, which may The Transmission Provider will Practice and Attachment K, endeavor to reasonably be required to facilitate provide Network Integration construct and place into service measurements and billing under the Transmission Service pursuant to the sufficient transfer capability to deliver Service Agreement. applicable terms and conditions contained in the Tariff and Service the Network Customer’s Network 24.3 Power Factor Agreement. Network Integration Resources to serve its Network Load on a basis comparable to the Transmission Unless otherwise agreed, the Transmission Service allows the Provider’s delivery of its own generating Transmission Customer is required to Network Customer to integrate, and purchased resources to its Native maintain a power factor within the same economically dispatch and regulate its Load Customers. range as the Transmission Provider current and planned Network Resources pursuant to Good Utility Practices. The to serve its Network Load in a manner 28.3 Network Integration Transmission power factor requirements are specified comparable to that in which the Service Transmission Provider utilizes its in the Service Agreement where The Transmission Provider will Transmission System to serve its Native applicable. provide firm transmission service over Load Customers. Network Integration its Transmission System to the Network 25 Compensation for Transmission Transmission Service also may be used Customer for the delivery of capacity Service by the Network Customer to deliver and energy from its designated Network economy energy purchases to its Rates for Firm and Non-Firm Point- Resources to service its Network Loads Network Load from non-designated To-Point Transmission Service are on a basis that is comparable to the resources on an as-available basis provided in the Schedules appended to Transmission Provider’s use of the without additional charge. Transmission the Tariff: Firm Point-To-Point Transmission System to reliably serve service for sales to non-designated loads Transmission Service (Schedule 7); and its Native Load Customers. Non-Firm Point-To-Point Transmission will be provided pursuant to the Service (Schedule 8). The Transmission applicable terms and conditions of Part 28.4 Secondary Service Provider shall use Part II of the Tariff to II of the Tariff. The Network Customer may use the make its Third-Party Sales. The 28 Nature of Network Integration Transmission Provider’s Transmission Transmission Provider shall account for Transmission Service System to deliver Economy Energy to its such use at the applicable Tariff rates, Network Loads from resources that have pursuant to Section 8. 28.1 Scope of Service not been designated as Network Network Integration Transmission Resources. Such energy shall be 26 Stranded Cost Recovery Service is a transmission service that transmitted, on an as-available basis, at The Transmission Provider may seek allows Network Customers to efficiently no additional charge. Secondary Service to recover stranded costs from the and economically utilize their Network shall not require the filing of an Transmission Customer pursuant to this Resources (as well as other non- Application for Network Integration Tariff in accordance with the terms, designated generation resources) to Transmission Service under the Tariff. conditions and procedures set forth in serve their Network Load located in the However, all other requirements of Part FERC Order No. 888. However, the Transmission Provider’s Control Area III of the Tariff (except for transmission Transmission Provider must separately and any additional load that may be rates) shall apply to Secondary Service. file any specific proposed stranded cost designated pursuant to Section 31.3 of Deliveries from resources other than

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Network Resources will have a higher as far as possible in advance of the • Unit size and amount of capacity priority than any Non-Firm Point-To- month in which service is to commence. from that unit to be designated as Point Transmission Service under Part II Unless subject to the procedures in Network Resource of the Tariff. Section 2, Completed Applications for • VAR capability (both leading and Network Integration Transmission lagging) of all generators 28.5 Real Power Losses Service will be assigned a priority • Operating restrictions Real Power Losses are associated with according to the date and time the —Any periods of restricted operations all transmission service. The Application is received, with the throughout the year Transmission Provider is not obligated earliest Application receiving the —Maintenance schedules to provide Real Power Losses. The highest priority. Applications should be —Minimum loading level of unit Network Customer is responsible for submitted by entering the information —Normal operating level of unit replacing losses associated with all listed below on the Transmission —Any must-run unit designations transmission service as calculated by Provider’s OASIS. Prior to required for system reliability or the Transmission Provider. The implementation of the Transmission contract reasons applicable Real Power Loss factors are Provider’s OASIS, a Completed • Approximate variable generating as follows: [To be completed by the Application may be submitted by (i) cost ($/MWH) for redispatch Transmission Provider]. transmitting the required information to computations the Transmission Provider by telefax, or 28.6 Restrictions on Use of Service • Arrangements governing sale and (ii) providing the information by delivery of power to third parties from The Network Customer shall not use telephone over the Transmission generating facilities located in the Network Integration Transmission Provider’s time recorded telephone line. Transmission Provider Control Area, Service for (i) sales of capacity and Each of these methods will provide a where only a portion of unit output is energy to non-designated loads, or (ii) time-stamped record for establishing the designated as a Network Resource direct or indirect provision of service priority of the Application. A • Description of purchased power transmission service by the Network Completed Application shall provide all designated as a Network Resource Customer to third parties. All Network of the information included in 18 CFR Customers taking Network Integration 2.20 including but not limited to the including source of supply, Control Transmission Service shall use Point- following: Area location, transmission To-Point Transmission Service under (i) The identity, address, telephone arrangements and delivery point(s) to Part II of the Tariff for any Third-Party number and facsimile number of the the Transmission Provider’s Sale which requires use of the party requesting service; Transmission System; Transmission Provider’s Transmission (ii) A statement that the party (vi) Description of Eligible Customer’s System. requesting service is, or will be upon transmission system: • Load flow and stability data, such 29 Initiating Service commencement of service, an Eligible Customer under the Tariff; as real and reactive parts of the load, 29.1 Condition Precedent for (iii) A description of the Network lines, transformers, reactive devices and Receiving Service Load at each delivery point. This load type, including normal and Subject to the terms and conditions of description should separately identify emergency ratings of all transmission Part III of the Tariff, the Transmission and provide the Eligible Customer’s best equipment in a load flow format Provider will provide Network estimate of the total loads to be served compatible with that used by the Integration Transmission Service to any at each transmission voltage level, and Transmission Provider • Eligible Customer, provided that (i) the the loads to be served from each Operating restrictions needed for Eligible Customer completes an Transmission Provider substation at the reliability • Application for service as provided same transmission voltage level. The Operating guides employed by under Part III of the Tariff, (ii) the description should include a ten (10) system operators • Eligible Customer and the Transmission year forecast of summer and winter load Contractual restrictions or Provider complete the technical and resource requirements beginning committed uses of the Eligible arrangements set forth in Sections 29.3 with the first year after the service is Customer’s transmission system, other and 29.4, (iii) the Eligible Customer scheduled to commence; than the Eligible Customer’s Network executes a Service Agreement pursuant (iv) The amount and location of any Loads and Resources • to Attachment F for service under Part interruptible loads included in the Location of Network Resources III of the Tariff or requests in writing Network Load. This shall include the described in subsection (v) above • that the Transmission Provider file a summer and winter capacity 10 year projection of system proposed unexecuted Service requirements for each interruptible load expansions or upgrades Agreement with the Commission, and (had such load not been interruptible), • Transmission System maps that (iv) the Eligible Customer executes a that portion of the load subject to include any proposed expansions or Network Operating Agreement with the interruption, the conditions under upgrades Transmission Provider pursuant to which an interruption can be • Thermal ratings of Eligible Attachment G, or requests in writing implemented and any limitations on the Customer’s Control Area ties with other that the Transmission Provider file a amount and frequency of interruptions. Control Areas; proposed unexecuted Network An Eligible Customer should identify (vii) Service Commencement Date and Operating Agreement. the amount of interruptible customer the term of the requested Network load (if any) included in the 10 year Integration Transmission Service. The 29.2 Application Procedures load forecast provided in response to minimum term for Network Integration An Eligible Customer requesting (iii) above; Transmission Service is one year; service under Part III of the Tariff must (v) A description of Network (viii) A statement signed by an submit an Application, with a deposit Resources (current and 10-year authorized officer from or agent of the approximating the charge for one month projection), which shall include, for Network Customer attesting that all of of service, to the Transmission Provider each Network Resource: the network resources listed pursuant to

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Section 29.2(v) satisfy the following coordination with the Network contingent upon the availability of conditions: (1) The Network Customer Customer, to complete such transmission service under Part III of the owns the resource, has committed to arrangements as soon as practicable Tariff; and (2) The Network Resources purchase generation pursuant to an taking into consideration the Service do not include any resources, or any executed contract, or has committed to Commencement Date. portion thereof, that are committed for purchase generation where execution of sale to non-designated third party load 29.4 Network Customer Facilities a contract is contingent upon the or otherwise cannot be called upon to availability of transmission service The provision of Network Integration meet the Network Customer’s Network under Part III of the Tariff; and (2) the Transmission Service shall be Load on a non-interruptible basis. The Network Resources do not include any conditioned upon the Network Network Customer’s request will be resources, or any portion thereof, that Customer’s constructing, maintaining deemed deficient if it does not include are committed for sale to non- and operating the facilities on its side of this statement and the Transmission designated third party load or otherwise each delivery point or interconnection Provider will follow the procedures for cannot be called upon to meet the necessary to reliably deliver capacity a deficient application as described in Network Customer’s Network Load on a and energy from the Transmission Section 29.2 of the Tariff. non-interruptible basis; and Provider’s Transmission System to the (ix) Any additional information Network Customer. The Network 30.3 Termination of Network required of the Transmission Customers Customer shall be solely responsible for Resources as specified in the Transmission constructing or installing all facilities on The Network Customer may terminate Provider’s planning process established the Network Customer’s side of each the designation of all or part of a in Attachment K. such delivery point or interconnection. generating resource as a Network Unless the Parties agree to a different Resource at any time but should provide 29.5 Filing of Service Agreement time frame, the Transmission Provider notification to the Transmission must acknowledge the request within The Transmission Provider will file Provider through OASIS as soon as ten (10) days of receipt. The Service Agreements with the reasonably practicable. acknowledgement must include a date Commission in compliance with 30.4 Operation of Network Resources by which a response, including a applicable Commission regulations. The Network Customer shall not Service Agreement, will be sent to the 30 Network Resources Eligible Customer. If an Application operate its designated Network fails to meet the requirements of this 30.1 Designation of Network Resources Resources located in the Network section, the Transmission Provider shall Network Resources shall include all Customer’s or Transmission Provider’s notify the Eligible Customer requesting generation owned, purchased or leased Control Area such that the output of service within fifteen (15) days of by the Network Customer designated to those facilities exceeds its designated receipt and specify the reasons for such serve Network Load under the Tariff. Network Load, plus Non-Firm Sales failure. Wherever possible, the Network Resources may not include delivered pursuant to Part II of the Transmission Provider will attempt to resources, or any portion thereof, that Tariff, plus losses. This limitation shall remedy deficiencies in the Application are committed for sale to non- not apply to changes in the operation of through informal communications with designated third party load or otherwise a Transmission Customer’s Network the Eligible Customer. If such efforts are cannot be called upon to meet the Resources at the request of the unsuccessful, the Transmission Provider Network Customer’s Network Load on a Transmission Provider to respond to an shall return the Application without non-interruptible basis. Any owned or emergency or other unforeseen prejudice to the Eligible Customer filing purchased resources that were serving condition which may impair or degrade a new or revised Application that fully the Network Customer’s loads under the reliability of the Transmission complies with the requirements of this firm agreements entered into on or System. The Network Customer may not section. The Eligible Customer will be before the Service Commencement Date schedule delivery of a Network assigned a new priority consistent with shall initially be designated as Network Resource not physically interconnected the date of the new or revised Resources until the Network Customer with the Transmission Provider’s Application. The Transmission Provider terminates the designation of such Transmission System in excess of the shall treat this information consistent resources. Network Resource’s capacity, as with the standards of conduct contained specified in the Network Customer’s in Part 37 of the Commission’s 30.2 Designation of New Network Application pursuant to Section 29. The regulations. Resources Transmission Provider shall specify the The Network Customer may designate rate treatment and all related terms and 29.3 Technical Arrangements To Be a new Network Resource by providing conditions applicable in the event that Completed Prior to Commencement of the Transmission Provider with as much a Network Customer’s schedule at the Service advance notice as practicable. A Point of Delivery for a Network Network Integration Transmission designation of a new Network Resource Resource not physically interconnected Service shall not commence until the must be made through the Transmission with the Transmission Provider’s Transmission Provider and the Network Provider’s OASIS by a request for Transmission System exceeds the Customer, or a third party, have modification of service pursuant to an Network Resource’s designated completed installation of all equipment Application under Section 29. This capacity. specified under the Network Operating request must include a statement that Agreement consistent with Good Utility the new network resource satisfies the 30.5 Network Customer Redispatch Practice and any additional following conditions: (1) The Network Obligation requirements reasonably and Customer owns the resource, has As a condition to receiving Network consistently imposed to ensure the committed to purchase generation Integration Transmission Service, the reliable operation of the Transmission pursuant to an executed contract, or has Network Customer agrees to redispatch System. The Transmission Provider committed to purchase generation its Network Resources as requested by shall exercise reasonable efforts, in where execution of a contract is the Transmission Provider pursuant to

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Section 33.2. To the extent practical, the subsequent to [the effective date of a Network Load, or (2) excluding that redispatch of resources pursuant to this Final Rule in RM05–25–000], the entire load from its Network Load and section shall be on a least cost, non- Network Customer shall receive credit purchasing Point-To-Point Transmission discriminatory basis between all provided such facilities are integrated Service under Part II of the Tariff. To the Network Customers, and the into the operations of the Transmission extent that the Network Customer gives Transmission Provider. Provider’s facilities and, if the notice of its intent to add a new transmission facilities were owned by 30.6 Transmission Arrangements for Network Load as part of its Network the Transmission Provider, would be Network Resources Not Physically Load pursuant to this section the eligible for inclusion in the Interconnected With the Transmission request must be made through a Transmission Provider’s Annual Provider modification of service pursuant to a Transmission Revenue Requirement. new Application. The Network Customer shall be Calculation of any credit under this responsible for any arrangements subsection shall be addressed in either 31.4 New Interconnection Points necessary to deliver capacity and energy the Network Customer’s Service from a Network Resource not physically Agreement or any other agreement To the extent the Network Customer interconnected with the Transmission between the Parties. desires to add a new Delivery Point or Provider’s Transmission System. The interconnection point between the Transmission Provider will undertake 31 Designation of Network Load Transmission Provider’s Transmission reasonable efforts to assist the Network 31.1 Network Load System and a Network Load, the Customer in obtaining such Network Customer shall provide the arrangements, including without The Network Customer must Transmission Provider with as much limitation, providing any information or designate the individual Network Loads advance notice as reasonably data required by such other entity on whose behalf the Transmission practicable. pursuant to Good Utility Practice. Provider will provide Network Integration Transmission Service. The 31.5 Changes in Service Requests 30.7 Limitation on Designation of Network Loads shall be specified in the Network Resources Service Agreement. Under no circumstances shall the The Network Customer must Network Customer’s decision to cancel 31.2 New Network Loads Connected or delay a requested change in Network demonstrate that it owns or has With the Transmission Provider committed to purchase generation Integration Transmission Service (e.g. pursuant to an executed contract in The Network Customer shall provide the addition of a new Network Resource order to designate a generating resource the Transmission Provider with as much or designation of a new Network Load) as a Network Resource. Alternatively, advance notice as reasonably practicable in any way relieve the Network the Network Customer may establish of the designation of new Network Load Customer of its obligation to pay the that execution of a contract is that will be added to its Transmission costs of transmission facilities contingent upon the availability of System. A designation of new Network constructed by the Transmission transmission service under Part III of the Load must be made through a Provider and charged to the Network Tariff. modification of service pursuant to a Customer as reflected in the Service new Application. The Transmission Agreement. However, the Transmission 30.8 Use of Interface Capacity by the Provider will use due diligence to Provider must treat any requested Network Customer install any transmission facilities change in Network Integration There is no limitation upon a Network required to interconnect a new Network Transmission Service in a non- Customer’s use of the Transmission Load designated by the Network discriminatory manner. Provider’s Transmission System at any Customer. The costs of new facilities particular interface to integrate the required to interconnect a new Network 31.6 Annual Load and Resource Network Customer’s Network Resources Load shall be determined in accordance Information Updates with the procedures provided in Section (or substitute economy purchases) with The Network Customer shall provide 32.4 and shall be charged to the its Network Loads. However, a Network the Transmission Provider with annual Network Customer in accordance with Customer’s use of the Transmission updates of Network Load and Network Commission policies. Provider’s total interface capacity with Resource forecasts consistent with those other transmission systems may not 31.3 Network Load Not Physically included in its Application for Network exceed the Network Customer’s Load. Interconnected With the Transmission Integration Transmission Service under 30.9 Network Customer Owned Provider Part III of the Tariff including, but not Transmission Facilities This section applies to both initial limited to, any information provided The Network Customer that owns designation pursuant to Section 31.1 under section 29.2(ix) pursuant to the existing transmission facilities that are and the subsequent addition of new Transmission Provider’s planning integrated with the Transmission Network Load not physically process in Attachment K. The Network Provider’s Transmission System may be interconnected with the Transmission Customer also shall provide the eligible to receive consideration either Provider. To the extent that the Network Transmission Provider with timely through a billing credit or some other Customer desires to obtain transmission written notice of material changes in mechanism. In order to receive such service for a load outside the any other information provided in its consideration the Network Customer Transmission Provider’s Transmission Application relating to the Network must demonstrate that its transmission System, the Network Customer shall Customer’s Network Load, Network facilities are integrated into the plans or have the option of (1) electing to include Resources, its transmission system or operations of the Transmission the entire load as Network Load for all other aspects of its facilities or Provider, to serve its power and purposes under Part III of the Tariff and operations affecting the Transmission transmission customers. For facilities designating Network Resources in Provider’s ability to provide reliable added by the Network Customer connection with such additional service.

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32 Additional Study Procedures for (iii) For System Impact Studies that for performing the required Facilities Network Integration Transmission the Transmission Provider conducts on Study. For a service request to remain Service Requests its own behalf, the Transmission a Completed Application, the Eligible Provider shall record the cost of the Customer shall execute the Facilities 32.1 Notice of Need for System Impact System Impact Studies pursuant to Study Agreement and return it to the Study Section 8. Transmission Provider within fifteen After receiving a request for service, 32.3 System Impact Study Procedures (15) days. If the Eligible Customer elects the Transmission Provider shall not to execute the Facilities Study determine on a non-discriminatory basis Upon receipt of an executed System Agreement, its Application shall be whether a System Impact Study is Impact Study Agreement, the deemed withdrawn and its deposit shall needed. A description of the Transmission Provider will use due be returned with interest. Upon receipt Transmission Provider’s methodology diligence to complete the required of an executed Facilities Study for completing a System Impact Study is System Impact Study within a sixty (60) Agreement, the Transmission Provider provided in Attachment D. If the day period. The System Impact Study will use due diligence to complete the Transmission Provider determines that a shall identify any system constraints required Facilities Study within a sixty System Impact Study is necessary to and redispatch options, including an (60) day period. If the Transmission accommodate the requested service, it estimate of the number of hours of Provider is unable to complete the shall so inform the Eligible Customer, as redispatch that may be required to Facilities Study in the allotted time soon as practicable. In such cases, the accommodate the request for period, the Transmission Provider shall Transmission Provider shall within Transmission Service and a preliminary notify the Eligible Customer and thirty (30) days of receipt of a estimate of the cost of redispatch, provide an estimate of the time needed Completed Application, tender a System additional Direct Assignment Facilities to reach a final determination along Impact Study Agreement pursuant to or Network Upgrades required to with an explanation of the reasons that which the Eligible Customer shall agree provide the requested service. In the additional time is required to complete event that the Transmission Provider is to reimburse the Transmission Provider the study. When completed, the unable to complete the required System for performing the required System Facilities Study will include a good Impact Study within such time period, Impact Study. For a service request to faith estimate of (i) the cost of Direct it shall so notify the Eligible Customer remain a Completed Application, the Assignment Facilities to be charged to and provide an estimated completion Eligible Customer shall execute the the Eligible Customer, (ii) the Eligible date along with an explanation of the System Impact Study Agreement and Customer’s appropriate share of the cost reasons why additional time is required return it to the Transmission Provider of any required Network Upgrades, and to complete the required studies. A copy within fifteen (15) days. If the Eligible (iii) the time required to complete such of the completed System Impact Study Customer elects not to execute the construction and initiate the requested and related work papers shall be made service. The Eligible Customer shall System Impact Study Agreement, its available to the Eligible Customer. The provide the Transmission Provider with Application shall be deemed withdrawn Transmission Provider will use the a letter of credit or other reasonable and its deposit shall be returned with same due diligence in completing the form of security acceptable to the interest. System Impact Study for an Eligible Transmission Provider equivalent to the 32.2 System Impact Study Agreement Customer as it uses when completing costs of new facilities or upgrades and Cost Reimbursement studies for itself. The Transmission Provider shall notify the Eligible consistent with commercial practices as (i) The System Impact Study Customer immediately upon completion established by the Uniform Commercial Agreement will clearly specify the of the System Impact Study if the Code. The Eligible Customer shall have Transmission Provider’s estimate of the Transmission System will be adequate thirty (30) days to execute a Service actual cost, and time for completion of to accommodate all or part of a request Agreement or request the filing of an the System Impact Study. The charge for service or that no costs are likely to unexecuted Service Agreement and shall not exceed the actual cost of the be incurred for new transmission provide the required letter of credit or study. In performing the System Impact facilities or upgrades. In order for a other form of security or the request no Study, the Transmission Provider shall request to remain a Completed longer will be a Completed Application rely, to the extent reasonably Application, within fifteen (15) days of and shall be deemed terminated and practicable, on existing transmission completion of the System Impact Study withdrawn. planning studies. The Eligible Customer the Eligible Customer must execute a 32.5 Penalties for Failure to Meet will not be assessed a charge for such Service Agreement or request the filing Study Deadlines existing studies; however, the Eligible of an unexecuted Service Agreement, or Customer will be responsible for charges Section 19.9 defines penalties that the Application shall be deemed apply for failure to meet the 60-day associated with any modifications to terminated and withdrawn. existing planning studies that are study completion due diligence reasonably necessary to evaluate the 32.4 Facilities Study Procedures deadlines for System Impact Studies impact of the Eligible Customer’s If a System Impact Study indicates and Facilities Studies under Part II of request for service on the Transmission that additions or upgrades to the the Tariff. These same requirements and System. Transmission System are needed to penalties apply to service under Part III (ii) If in response to multiple Eligible supply the Eligible Customer’s service of the Tariff. Customers requesting service in relation request, the Transmission Provider, 33 Load Shedding and Curtailments to the same competitive solicitation, a within thirty (30) days of the single System Impact Study is sufficient completion of the System Impact Study, 33.1 Procedures for the Transmission Provider to shall tender to the Eligible Customer a Prior to the Service Commencement accommodate the service requests, the Facilities Study Agreement pursuant to Date, the Transmission Provider and the costs of that study shall be pro-rated which the Eligible Customer shall agree Network Customer shall establish Load among the Eligible Customers. to reimburse the Transmission Provider Shedding and Curtailment procedures

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pursuant to the Network Operating to Curtail scheduled deliveries, the Curtailment. Any Curtailment of Agreement with the objective of Parties shall Curtail such schedules in Network Integration Transmission responding to contingencies on the accordance with the Network Operating Service will be not unduly Transmission System and on systems Agreement or pursuant to the discriminatory relative to the directly and indirectly interconnected Transmission Loading Relief procedures Transmission Provider’s use of the with Transmission Provider’s specified in Attachment J. Transmission System on behalf of its Transmission System. The Parties will 33.5 Allocation of Curtailments Native Load Customers. The implement such programs during any Transmission Provider shall specify the period when the Transmission Provider The Transmission Provider shall, on a rate treatment and all related terms and determines that a system contingency non-discriminatory basis, Curtail the conditions applicable in the event that exists and such procedures are transaction(s) that effectively relieve the the Network Customer fails to respond necessary to alleviate such contingency. constraint. However, to the extent to established Load Shedding and The Transmission Provider will notify practicable and consistent with Good Curtailment procedures. all affected Network Customers in a Utility Practice, any Curtailment will be timely manner of any scheduled shared by the Transmission Provider 34 Rates and Charges Curtailment. and Network Customer in proportion to The Network Customer shall pay the their respective Load Ratio Shares. The Transmission Provider for any Direct 33.2 Transmission Constraints Transmission Provider shall not direct Assignment Facilities, Ancillary During any period when the the Network Customer to Curtail Services, and applicable study costs, Transmission Provider determines that a schedules to an extent greater than the consistent with Commission policy, transmission constraint exists on the Transmission Provider would Curtail along with the following: Transmission System, and such the Transmission Provider’s schedules constraint may impair the reliability of under similar circumstances. 34.1 Monthly Demand Charge the Transmission Provider’s system, the 33.6 Load Shedding The Network Customer shall pay a Transmission Provider will take monthly Demand Charge, which shall whatever actions, consistent with Good To the extent that a system be determined by multiplying its Load Utility Practice, that are reasonably contingency exists on the Transmission Ratio Share times one twelfth (1/12) of necessary to maintain the reliability of Provider’s Transmission System and the the Transmission Provider’s Annual the Transmission Provider’s system. To Transmission Provider determines that Transmission Revenue Requirement the extent the Transmission Provider it is necessary for the Transmission specified in Schedule H. determines that the reliability of the Provider and the Network Customer to Transmission System can be maintained shed load, the Parties shall shed load in 34.2 Determination of Network by redispatching resources, the accordance with previously established Customer’s Monthly Network Load Transmission Provider will initiate procedures under the Network The Network Customer’s monthly procedures pursuant to the Network Operating Agreement. Network Load is its hourly load Operating Agreement to redispatch all 33.7 System Reliability (including its designated Network Load Network Resources and the not physically interconnected with the Transmission Provider’s own resources Notwithstanding any other provisions Transmission Provider under Section on a least-cost basis without regard to of this Tariff, the Transmission Provider 31.3) coincident with the Transmission the ownership of such resources. Any reserves the right, consistent with Good Provider’s Monthly Transmission redispatch under this section may not Utility Practice and on a not unduly System Peak. discriminatory basis, to Curtail Network unduly discriminate between the 34.3 Determination of Transmission Transmission Provider’s use of the Integration Transmission Service without liability on the Transmission Provider’s Monthly Transmission Transmission System on behalf of its System Load Native Load Customers and any Provider’s part for the purpose of Network Customer’s use of the making necessary adjustments to, The Transmission Provider’s monthly Transmission System to serve its changes in, or repairs on its lines, Transmission System load is the designated Network Load. substations and facilities, and in cases Transmission Provider’s Monthly where the continuance of Network Transmission System Peak minus the 33.3 Cost Responsibility for Relieving Integration Transmission Service would coincident peak usage of all Firm Point- Transmission Constraints endanger persons or property. In the To-Point Transmission Service Whenever the Transmission Provider event of any adverse condition(s) or customers pursuant to Part II of this implements least-cost redispatch disturbance(s) on the Transmission Tariff plus the Reserved Capacity of all procedures in response to a Provider’s Transmission System or on Firm Point-To-Point Transmission transmission constraint, the any other system(s) directly or Service customers. Transmission Provider and Network indirectly interconnected with the 34.4 Redispatch Charge Customers will each bear a Transmission Provider’s Transmission proportionate share of the total System, the Transmission Provider, The Network Customer shall pay a redispatch cost based on their respective consistent with Good Utility Practice, Load Ratio Share of any redispatch costs Load Ratio Shares. also may Curtail Network Integration allocated between the Network Transmission Service in order to (i) Customer and the Transmission 33.4 Curtailments of Scheduled limit the extent or damage of the Provider pursuant to Section 33. To the Deliveries adverse condition(s) or disturbance(s), extent that the Transmission Provider If a transmission constraint on the (ii) prevent damage to generating or incurs an obligation to the Network Transmission Provider’s Transmission transmission facilities, or (iii) expedite Customer for redispatch costs in System cannot be relieved through the restoration of service. The Transmission accordance with Section 33, such implementation of least-cost redispatch Provider will give the Network amounts shall be credited against the procedures and the Transmission Customer as much advance notice as is Network Customer’s bill for the Provider determines that it is necessary practicable in the event of such applicable month.

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34.5 Stranded Cost Recovery requirements, including all necessary Voltage Control from Generation The Transmission Provider may seek Ancillary Services, by contracting with Sources Service must be provided for to recover stranded costs from the another entity, consistent with Good each transaction on the Transmission Network Customer pursuant to this Utility Practice, which satisfies NERC Provider’s transmission facilities. The Tariff in accordance with the terms, and the [applicable regional reliability amount of Reactive Supply and Voltage conditions and procedures set forth in council] requirements. The Control from Generation Sources FERC Order No. 888. However, the Transmission Provider shall not Service that must be supplied with Transmission Provider must separately unreasonably refuse to accept respect to the Transmission Customer’s file any proposal to recover stranded contractual arrangements with another transaction will be determined based on costs under Section 205 of the Federal entity for Ancillary Services. The the reactive power support necessary to Power Act. Network Operating Agreement is maintain transmission voltages within included in Attachment G. limits that are generally accepted in the 35 Operating Arrangements 35.3 Network Operating Committee region and consistently adhered to by 35.1 Operation Under the Network the Transmission Provider. A Network Operating Committee Operating Agreement Reactive Supply and Voltage Control (Committee) shall be established to from Generation Sources Service is to be The Network Customer shall plan, coordinate operating criteria for the provided directly by the Transmission construct, operate and maintain its Parties’ respective responsibilities under Provider (if the Transmission Provider facilities in accordance with Good the Network Operating Agreement. Each is the Control Area operator) or Utility Practice and in conformance Network Customer shall be entitled to indirectly by the Transmission Provider with the Network Operating Agreement. have at least one representative on the making arrangements with the Control 35.2 Network Operating Agreement Committee. The Committee shall meet Area operator that performs this service from time to time as need requires, but for the Transmission Provider’s The terms and conditions under no less than once each calendar year. which the Network Customer shall Transmission System. The Transmission operate its facilities and the technical Schedule 1 Customer must purchase this service and operational matters associated with from the Transmission Provider or the Scheduling, System Control and Control Area operator. The charges for the implementation of Part III of the Dispatch Service Tariff shall be specified in the Network such service will be based on the rates Operating Agreement. The Network This service is required to schedule set forth below. To the extent the Operating Agreement shall provide for the movement of power through, out of, Control Area operator performs this the Parties to (i) operate and maintain within, or into a Control Area. This service for the Transmission Provider, equipment necessary for integrating the service can be provided only by the charges to the Transmission Customer Network Customer within the operator of the Control Area in which are to reflect only a pass-through of the Transmission Provider’s Transmission the transmission facilities used for costs charged to the Transmission System (including, but not limited to, transmission service are located. Provider by the Control Area operator. Scheduling, System Control and remote terminal units, metering, Schedule 3 communications equipment and Dispatch Service is to be provided relaying equipment), (ii) transfer data directly by the Transmission Provider (if Regulation and Frequency Response between the Transmission Provider and the Transmission Provider is the Control Service the Network Customer (including, but Area operator) or indirectly by the Regulation and Frequency Response not limited to, heat rates and Transmission Provider making Service is necessary to provide for the operational characteristics of Network arrangements with the Control Area continuous balancing of resources Resources, generation schedules for operator that performs this service for (generation and interchange) with load units outside the Transmission the Transmission Provider’s and for maintaining scheduled Provider’s Transmission System, Transmission System. The Transmission Interconnection frequency at sixty interchange schedules, unit outputs for Customer must purchase this service cycles per second (60 Hz). Regulation redispatch required under Section 33, from the Transmission Provider or the and Frequency Response Service is voltage schedules, loss factors and other Control Area operator. The charges for accomplished by committing on-line real time data), (iii) use software Scheduling, System Control and generation whose output is raised or programs required for data links and Dispatch Service are to be based on the lowered (predominantly through the use constraint dispatching, (iv) exchange rates set forth below. To the extent the of automatic generating control data on forecasted loads and resources Control Area operator performs this equipment) as necessary to follow the necessary for long-term planning, and service for the Transmission Provider, moment-by-moment changes in load. (v) address any other technical and charges to the Transmission Customer The obligation to maintain this balance operational considerations required for are to reflect only a pass-through of the between resources and load lies with implementation of Part III of the Tariff, costs charged to the Transmission the Transmission Provider (or the including scheduling protocols. The Provider by that Control Area operator. Control Area operator that performs this Network Operating Agreement will Schedule 2 function for the Transmission Provider). recognize that the Network Customer The Transmission Provider must offer shall either (i) operate as a Control Area Reactive Supply and Voltage Control this service when the transmission under applicable guidelines of the North From Generation Sources Service service is used to serve load within its American Electric Reliability Council In order to maintain transmission Control Area. The Transmission (NERC) and the [applicable regional voltages on the Transmission Provider’s Customer must either purchase this reliability council], (ii) satisfy its transmission facilities within acceptable service from the Transmission Provider Control Area requirements, including all limits, generation facilities under the or make alternative comparable necessary Ancillary Services, by control of the control area operator are arrangements to satisfy its Regulation contracting with the Transmission operated to produce (or absorb) reactive and Frequency Response Service Provider, or (iii) satisfy its Control Area power. Thus, Reactive Supply and obligation. The amount of and charges

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for Regulation and Frequency Response Schedule 5 (1) Yearly delivery: one-twelfth of the Service are set forth below. To the demand charge of $lll/KW of Operating Reserve—Spinning Reserve extent the Control Area operator Reserved Capacity per year. Service performs this service for the (2) Monthly delivery: $lll/KW of Transmission Provider, charges to the Spinning Reserve Service is needed to Reserved Capacity per month. Transmission Customer are to reflect serve load immediately in the event of (3) Weekly delivery: $lll/KW of only a pass-through of the costs charged a system contingency. Spinning Reserve Reserved Capacity per week. lll to the Transmission Provider by that Service may be provided by generating (4) Daily delivery: $ /KW of Control Area operator. units that are on-line and loaded at less Reserved Capacity per day. than maximum output. The The total demand charge in any week, Schedule 4 pursuant to a reservation for Daily Transmission Provider must offer this delivery, shall not exceed the rate service when the transmission service is Energy Imbalance Service specified in section (3) above times the used to serve load within its Control highest amount in kilowatts of Reserved Energy Imbalance Service is provided Area. The Transmission Customer must Capacity in any day during such week. when a difference occurs between the either purchase this service from the (5) Hourly delivery: $lll/KW of scheduled and the actual delivery of Transmission Provider or make energy to a load located within a Reserved Capacity per hour. alternative comparable arrangements to The total demand charge in any day, Control Area over a single hour. The satisfy its Spinning Reserve Service pursuant to a reservation for Hourly Transmission Provider must offer this obligation. The amount of and charges delivery, shall not exceed the rate service when the transmission service is for Spinning Reserve Service are set specified in section (4) above times the used to serve load within its Control forth below. To the extent the Control highest amount in kilowatts of Reserved Area. The Transmission Customer must Area operator performs this service for Capacity in any hour during such day. either purchase this service from the the Transmission Provider, charges to In addition, the total demand charge in Transmission Provider or make the Transmission Customer are to reflect any week, pursuant to a reservation for alternative comparable arrangements to only a pass-through of the costs charged Hourly or Daily delivery, shall not satisfy its Energy Imbalance Service to the Transmission Provider by that exceed the rate specified in section (3) obligation. To the extent the Control Control Area operator. above times the highest amount in Area operator performs this service for Schedule 6 kilowatts of Reserved Capacity in any the Transmission Provider, charges to hour during such week. the Transmission Customer are to reflect Operating Reserve—Supplemental (6) Discounts: Three principal only a pass-through of the costs charged Reserve Service requirements apply to discounts for transmission service as follows (1) any to the Transmission Provider by that Supplemental Reserve Service is offer of a discount made by the Control Area operator. The needed to serve load in the event of a Transmission Provider must be Transmission Provider may only charge system contingency; however, it is not announced to all Eligible Customers a Transmission Customer for either available immediately to serve load but solely by posting on the OASIS, (2) any hourly generator imbalances under rather within a short period of time. customer-initiated requests for Schedule 9 or hourly energy imbalances Supplemental Reserve Service may be discounts (including requests for use by under this schedule for the same provided by generating units that are one’s wholesale merchant or an imbalance, but not both. on-line but unloaded, by quick-start affiliate’s use) must occur solely by generation or by interruptible load. The The Transmission Provider shall posting on the OASIS, and (3) once a ± Transmission Provider must offer this establish a deviation band of 1.5 discount is negotiated, details must be service when the transmission service is percent (with a minimum of 2 MW) of immediately posted on the OASIS. For used to serve load within its Control the scheduled transaction to be applied any discount agreed upon for service on Area. The Transmission Customer must hourly to any energy imbalance that a path, from point(s) of receipt to either purchase this service from the occurs as a result of the Transmission point(s) of delivery, the Transmission Transmission Provider or make Customer’s scheduled transaction(s). Provider must offer the same discounted alternative comparable arrangements to Parties should attempt to eliminate transmission service rate for the same satisfy its Supplemental Reserve Service energy imbalances within the limits of time period to all Eligible Customers on obligation. The amount of and charges the deviation band within thirty (30) all unconstrained transmission paths for Supplemental Reserve Service are days or within such other reasonable that go to the same point(s) of delivery set forth below. To the extent the period of time as is generally accepted on the Transmission System. Control Area operator performs this in the region and consistently adhered service for the Transmission Provider, Schedule 8 to by the Transmission Provider. If an charges to the Transmission Customer energy imbalance is not corrected Non-Firm Point-to-Point Transmission are to reflect only a pass-through of the Service within thirty (30) days or a reasonable costs charged to the Transmission period of time that is generally accepted Provider by that Control Area operator. The Transmission Customer shall in the region and consistently adhered compensate the Transmission Provider to by the Transmission Provider, the Schedule 7 for Non-Firm Point-To-Point Transmission Customer will Long-Term Firm and Short-Term Firm Transmission Service up to the sum of compensate the Transmission Provider Point-to-Point Transmission Service the applicable charges set forth below: for such service. Energy imbalances (1) Monthly delivery: $lll/KW of outside the deviation band will be The Transmission Customer shall Reserved Capacity per month. subject to charges to be specified by the compensate the Transmission Provider (2) Weekly delivery: $lll/KW of Transmission Provider. The charges for each month for Reserved Capacity at the Reserved Capacity per week. Energy Imbalance Service are set forth sum of the applicable charges set forth (3) Daily delivery: $lll/KW of below. below: Reserved Capacity per day.

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The total demand charge in any week, performs this service for the Transmission Customer: pursuant to a reservation for Daily Transmission Provider, charges to the lllllllllllllllllll delivery, shall not exceed the rate Transmission Customer are to reflect lllllllllllllllllll specified in section (2) above times the only a pass-through of the costs charged lllllllllllllllllll highest amount in kilowatts of Reserved to the Transmission Provider by that Capacity in any day during such week. Control Area Operator. The 7.0 The Tariff is incorporated herein (4) Hourly delivery: The basic charge Transmission Provider may only charge and made a part hereof. shall be that agreed upon by the Parties a Transmission Customer for either IN WITNESS WHEREOF, the Parties at the time this service is reserved and hourly generator imbalances under this have caused this Service Agreement to in no event shall exceed $lll/MWH. Schedule or hourly energy imbalances be executed by their respective The total demand charge in any day, under Schedule 4 for the same authorized officials. pursuant to a reservation for Hourly imbalance, but not both. Transmission Provider: delivery, shall not exceed the rate The Transmission Provider shall specified in section (3) above times the establish a deviation band of +/-1.5 By: highest amount in kilowatts of Reserved percent (with a minimum of 2 MW) of Namelllllll llllllll Capacity in any hour during such day. the scheduled transaction to be applied Titlelllllll lllllllll In addition, the total demand charge in on a net hourly basis to any Generator Datelllllll lllllllll any week, pursuant to a reservation for Imbalance that occurs as a result of the Transmission Customer: Hourly or Daily delivery, shall not Transmission Customer’s scheduled By: exceed the rate specified in section (2) transaction(s). The charges for Generator Namelllllll llllllll above times the highest amount in Imbalance Service are set out below: Titlelllllll lllllllll kilowatts of Reserved Capacity in any Attachment A—Form of Service Datelllllll lllllllll hour during such week. (5) Discounts: Three principal Agreement for Firm Point-to-Point Specifications for Long-Term Firm requirements apply to discounts for Transmission Service Point-to-Point Transmission Service transmission service as follows (1) any 1.0 This Service Agreement, dated 1.0 Term of Transaction: llll ll offer of a discount made by the as of llllllll, is entered into, Start Date:lllllll llllll Transmission Provider must be by and between llllllll (the Termination Date:lllllll lll announced to all Eligible Customers Transmission Provider), solely by posting on the OASIS, (2) any and llllllll (‘‘Transmission 2.0 Description of capacity and energy customer-initiated requests for Customer’’). to be transmitted by Transmission discounts (including requests for use by 2.0 The Transmission Customer has Provider including the electric Control one’s wholesale merchant or an been determined by the Transmission Area in which the transaction affiliate’s use) must occur solely by Provider to have a Completed originates. posting on the OASIS, and (3) once a Application for Firm Point-To-Point lllllllllllllllllll discount is negotiated, details must be Transmission Service under the Tariff. 3.0 Point(s) of Receipt:lllllll immediately posted on the OASIS. For 3.0 The Transmission Customer has Delivering Party:lllllll lll any discount agreed upon for service on provided to the Transmission Provider 4.0 Point(s) of Delivery: llll ll a path, from point(s) of receipt to an Application deposit in accordance Receiving Party:lllllll lll point(s) of delivery, the Transmission with the provisions of Section 17.3 of 5.0 Maximum amount of capacity and Provider must offer the same discounted the Tariff. energy to be transmitted (Reserved Ca- transmission service rate for the same 4.0 Service under this agreement pacity):lllllll lllllll time period to all Eligible Customers on shall commence on the later of (l) the all unconstrained transmission paths requested service commencement date, 6.0 Designation of party(ies) subject to that go to the same point(s) of delivery or (2) the date on which construction of reciprocal service obligation: lllll on the Transmission System. any Direct Assignment Facilities and/or lllllllllllllllllll Network Upgrades are completed, or (3) lllllllllllllllllll Schedule 9 such other date as it is permitted to lllllllllllllllllll Generator Imbalance Service become effective by the Commission. lllllllllllllllllll Generator Imbalance Service is Service under this agreement shall 7.0 Name(s) of any Intervening Sys- l provided when a difference occurs terminate on such date as mutually tems providing transmission service: lllllllllllllllllll between the output of a generator agreed upon by the parties. lllllllllllllllllll located in the Transmission Provider’s 5.0 The Transmission Provider Control Area and a delivery schedule agrees to provide and the Transmission 8.0 Service under this Agreement may from that generator to (1) another Customer agrees to take and pay for be subject to some combination of the Control Area or (2) a load within the Firm Point-To-Point Transmission charges detailed below. (The Transmission Provider’s Control Area Service in accordance with the appropriate charges for individual over a single hour. The Transmission provisions of Part II of the Tariff and transactions will be determined in Provider must offer this service when this Service Agreement. accordance with the terms and Transmission Service is used to deliver 6.0 Any notice or request made to or conditions of the Tariff.) energy from a generator located within by either Party regarding this Service its Control Area. The Transmission Agreement shall be made to the 8.1 Transmission Charge: lllllllllllllllllll Customer must either purchase this representative of the other Party as lllllllllllllllllll service from the Transmission Provider indicated below. or make alternative comparable Transmission Provider: 8.2 System Impact and/or Facilities arrangements to satisfy its Generator lllllllllllllllllll Study Charge(s): Imbalance Service obligation. To the lllllllllllllllllll lllllllllllllllllll extent the Control Area operator lllllllllllllllllll lllllllllllllllllll

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8.3 Direct Assignment Facilities Name lllllllllllllll (d) For TRM, a Transmission Provider Charge: Title llllllllllllllll shall explain: (i) Its definition of TRM; lllllllllllllllllll Date llllllllllllllll (ii) its TRM calculation methodology lllllllllllllllllll Transmission Customer: (e.g., its assumptions on load forecast 8.4 Ancillary Services Charges: By: errors, forecast errors in system topology llllllllllllllllll Name lllllllllllllll or distribution factors and loop flow lllllllllllllllllll Title llllllllllllllll sources); (iii) the databases used in its lllllllllllllllllll Date llllllllllllllll TRM assessments; (iv) the conditions lllllllllllllllllll under which the transmission provider lllllllllllllllllll Attachment C—Methodology To Assess uses TRM; and (v) the process used to lllllllllllllllllll Available Transfer Capability prevent double-counting of contingency lllllllllllllllllll The Transmission Provider must outages used in its TTC and TRM lllllllllllllllllll include, at a minimum, the following calculations. A Transmission Provider information concerning its ATC that does not reserve TRM must so state. Attachment B—Form of Service calculation methodology: (e) For CBM, the Transmission Agreement for Non-Firm Point-to-Point (1) the specific mathematical Provider shall include a specific and Transmission Service algorithm used to calculate firm and self-contained narrative explanation of 1.0 This Service Agreement, dated non-firm ATC (and AFC, if applicable) its CBM practice, including: (i) Who as of llll, is entered into, by and for its scheduling horizon (same day performs the assessment (transmission between llll (the Transmission and real-time), operating horizon (day or merchant staff); (ii) the methodology Provider), and llll (Transmission ahead and pre-schedule) and planning used to perform generation reliability Customer). horizon (beyond the operating horizon); assessments (e.g., probabilistic or 2.0 The Transmission Customer has (2) a process flow diagram that deterministic); (iii) whether the been determined by the Transmission illustrates the various steps through assessment method reflects a specific Provider to be a Transmission Customer which ATC/AFC is calculated; and regional practice; (iv) the assumptions under Part II of the Tariff and has filed (3) a detailed explanation of how each used in those assessments; and (v) the a Completed Application for Non-Firm of the ATC components is calculated for basis for the selection of paths on which Point-To-Point Transmission Service in both the operating and planning CBM is set aside. accordance with Section 18.2 of the horizons. (f) In addition, for CBM, a Tariff. (a) For TTC, a Transmission Provider Transmission Provider shall: (i) Explain 3.0 Service under this Agreement shall: (i) Explain its definition of TTC; its definition of CBM; (ii) list the shall be provided by the Transmission (ii) explain its TTC calculation databases used in its CBM calculations; Provider upon request by an authorized methodology (e.g., load flow, short and (iii) prove that there is no double- representative of the Transmission circuit, stability, transfer studies); (iii) counting of contingency outages when Customer. list the databases used in its TTC performing CBM, TTC, and TRM 4.0 The Transmission Customer assessments; and (iv) explain the calculations. agrees to supply information the assumptions used in its TTC (g) The Transmission Provider shall Transmission Provider deems assessments regarding load levels, post its procedures for allowing CBM reasonably necessary in accordance generation dispatch, and modeling of during emergencies (with an with Good Utility Practice in order for planned and contingency outages. explanation of what constitutes an it to provide the requested service. (b) For ETC, a transmission provider emergency, the entities that are 5.0 The Transmission Provider shall explain: (i) Its definition of ETC; permitted to use CBM during agrees to provide and the Transmission (ii) the calculation methodology used to emergencies and the procedures which Customer agrees to take and pay for determine the transmission capacity to must be followed by the transmission Non-Firm Point-To-Point Transmission be set aside for native load, network providers’ merchant function and other Service in accordance with the load, and non-OATT customers load-serving entities when they need to provisions of Part II of the Tariff and (including, if applicable, an explanation access CBM). If the Transmission this Service Agreement. of assumptions on the selection of 6.0 Any notice or request made to or Provider’s practice is not to reserve generators that are modeled in service); CBM, it shall so state. by either Party regarding this Service (iii) how point-to-point transmission Agreement shall be made to the service requests are incorporated; (iv) Attachment D—Methodology for representative of the other Party as how rollover rights are accounted for; Completing a System Impact Study indicated below. and (v) its processes for ensuring that To be filed by the Transmission Transmission Provider: non-firm capacity is released properly lllllllllllllllllll Provider. (e.g., when real time schedules replace lllllllllllllllllll the associated transmission service Attachment E—Index of Point-to-Point lllllllllllllllllll requests in its real-time calculations). Transmission Service Customers Transmission Customer: (c) If a Transmission Provider uses an lllllllllllllllllll lllllllllllllllllll AFC methodology to calculate ATC, it lllllllllllllllllll shall explain: (i) its definition of AFC; Customer: lllllllllllllllllll lllllllllllllllllll (ii) its AFC calculation methodology 7.0 The Tariff is incorporated herein (e.g., load flow, short circuit, stability, Date of Service Agreement and made a part hereof. transfer studies); (iii) its process for lllllllllllllllllll IN WITNESS WHEREOF, the Parties converting AFC into ATC; (iv) what Attachment F—Service Agreement for have caused this Service Agreement to databases are used in its AFC Network Integration Transmission be executed by their respective assessments; (v) the assumptions used Service authorized officials. in its AFC assessments; and (vi) the Transmission Provider: reliability criteria used for contingency To be filed by the Transmission By: outages simulation. Provider.

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Attachment G—Network Operating coordination of such planning with unconditional and irrevocable letter of Agreement interconnected systems within its credit as security to meet its To be filed by the Transmission region, to ensure that the Transmission responsibilities and obligations under Provider. System is planned to meet the needs of the Tariff, or an alternative form of both the Transmission Provider and its security proposed by the Transmission Attachment H—Annual Transmission Network and Firm Point-to-Point Customer and acceptable to the Revenue Requirement for Network Transmission Customers on a Transmission Provider and consistent Integration Transmission Service comparable and nondiscriminatory with commercial practices established 1. The Annual Transmission Revenue basis. The Transmission Provider’s by the Uniform Commercial Code that Requirement for purposes of the coordinated, open and transparent protects the Transmission Provider Network Integration Transmission planning process shall be provided as against the risk of non-payment. Service shall be lllll. an attachment to the Transmission Additionally, the Transmission 2. The amount in (1) shall be effective Provider’s Tariff. Provider must include, at a minimum, The Transmission Provider’s planning until amended by the Transmission the following information concerning its process shall satisfy the following eight Provider or modified by the creditworthiness procedures: Commission. principles, as defined in the Final Rule in Docket No. RM05–25–000: (1) A summary of the procedure for Attachment I—Index of Network Coordination, openness, transparency, determining the level of secured and Integration Transmission Service information exchange, comparability, unsecured credit; Customers dispute resolution, regional (2) A list of the acceptable types of coordination, and congestion studies. collateral/security; Customer lllllllllllllllllll Attachment L—Creditworthiness (3) A procedure for providing Procedures customers with reasonable notice of Date of Service Agreement changes in credit levels and collateral For the purpose of determining the lllllllllllllllllll requirements; ability of the Transmission Customer to Attachment J—Procedures for meet its obligations related to service (4) A procedure for providing Addressing Parallel Flows hereunder, the Transmission Provider customers, upon request, a written To be filed by the Transmission may require reasonable credit review explanation for any change in credit Provider. procedures. This review shall be made levels or collateral requirements; in accordance with standard (5) A reasonable opportunity to Attachment K—Transmission Planning commercial practices and must specify contest determinations of credit levels Process quantitative and qualitative criteria to or collateral requirements; and The Transmission Provider shall determine the level of secured and (6) A reasonable opportunity to post establish a coordinated, open and unsecured credit. additional collateral, including curing transparent planning process with its The Transmission Provider may any non-creditworthy determination. Network and Firm Point-to-Point require the Transmission Customer to Transmission Customers and other provide and maintain in effect during [FR Doc. 06–4904 Filed 6–5–06; 8:45 am] interested parties, including the the term of the Service Agreement, an BILLING CODE 6717–01–P

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Part III

Department of the Interior Fish and Wildlife Service

50 CFR Part 17 Endangered and Threatened Wildlife and Plants; Critical Habitat for Five Endangered and Two Threatened Mussels in Four Northeast Gulf of Mexico Drainages; Proposed Rule

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DEPARTMENT OF THE INTERIOR 5. Federal eRulemaking Portal: http:// If you wish to comment, you may www.regulations.gov. Follow the submit your comments and materials Fish and Wildlife Service instructions for submitting comments. concerning this proposal by any one of Comments and materials received, as several methods (see ADDRESSES 50 CFR Part 17 well as supporting documentation used section). Please submit e-mail comments in the preparation of this proposed rule, to [email protected] in RIN 1018–AU87 will be available for public inspection, ASCII file format and avoid the use of by appointment, during normal business special characters or any form of Endangered and Threatened Wildlife hours at U.S. Fish and Wildlife Service, encryption. Please also include ‘‘Attn: 7 and Plants; Critical Habitat for Five 1601 Balboa Avenue, Panama City, mussels—RIN 1018–AU87’’ in your e- Endangered and Two Threatened Florida 32405 (telephone 850–769– mail subject header, and your name and Mussels in Four Northeast Gulf of 0552). return address in the body of your Mexico Drainages FOR FURTHER INFORMATION CONTACT: Jerry message. If you do not receive a Ziewitz at the address above (telephone confirmation from the system that we AGENCY: Fish and Wildlife Service, 850–769–0552 ext. 223; facsimile 850– have received your message, contact us Interior. 763–2177). directly by calling our Panama City, ACTION: Proposed rule. SUPPLEMENTARY INFORMATION: Florida, Fish and Wildlife Office at phone number 850–769–0552. Please SUMMARY: We, the U.S. Fish and Public Comments Solicited note that the e-mail address Wildlife Service (Service), propose to We intend that any final action [email protected] will be designate critical habitat for the resulting from this proposal will be as closed out at the termination of the endangered fat threeridge, shinyrayed accurate and as effective as possible. public comment period. pocketbook, Gulf moccasinshell, Therefore, comments or suggestions Our practice is to make comments, Ochlockonee moccasinshell, and oval from the public, other concerned including names and home addresses of pigtoe, and the threatened Chipola governmental agencies, the scientific respondents, available for public review slabshell and purple bankclimber community, industry, or any other during regular business hours. (collectively referred to as the seven interested party concerning this Individual respondents may request that mussels), pursuant to the Endangered proposed rule are hereby solicited. We we withhold their home addresses from Species Act of 1973, as amended (Act). particularly seek comments concerning: the rulemaking record, which we will We propose to designate 11 units (1) The reasons any habitat should or honor to the extent allowable by law. encompassing approximately 1,864 should not be determined to be critical There also may be circumstances in kilometers (1,158 miles) of river and habitat as provided by section 4 of the which we would withhold from the stream channels as critical habitat. Act (16 U.S.C. 1531 et seq.), including rulemaking record a respondent’s Proposed critical habitat includes whether the benefit of designation will identity, as allowable by law. If you portions of the Econfina Creek drainage outweigh any threats to the species due wish us to withhold your name or in Florida, the Apalachicola— to designation; address, you must state this Chattahoochee—Flint River drainage in (2) Specific information on the prominently at the beginning of your Alabama, Florida, and Georgia, the amount and distribution of habitat for comment, but you should be aware that Ochlockonee River drainage in Florida the seven mussels, including areas the Service may be required to disclose and Georgia, and the Suwannee River occupied by the seven mussels at the your name and address pursuant to the drainage in Florida. time of listing and containing the Freedom of Information Act. However, DATES: We will accept comments from features essential to the conservation of we will not consider anonymous all interested parties until August 7, the species, and areas not occupied at comments. We will make all 2006. We must receive requests for the time of listing that are essential to submissions from organizations or public hearings, in writing, at the the conservation of the species; businesses, and from individuals address shown in the ADDRESSES section (3) Whether the middle section of the identifying themselves as by July 21, 2006. Flint River complex, between the representatives or officials of confluence of Gum Creek and the organizations or businesses, available ADDRESSES: If you wish to comment, confluence of Auchumpkee/ for public inspection in their entirety. you may submit your comments and Ulcohatchee Creek, has the Primary Comments and materials received will materials concerning this proposal by Constituent Elements for the mussels, is be available for public inspection, by any one of the following methods: occupied by the mussels, or is essential appointment, during normal business 1. You may submit written comments to the conservation of the mussels; hours at the above address. and information to the Field Supervisor, (4) Land use designations and current Role of Critical Habitat in Actual U.S. Fish and Wildlife Service, 1601 or planned activities in the subject areas Practice of Administering and Balboa Avenue, Panama City, Florida and their possible impacts on proposed Implementing the Act 32405. critical habitat; 2. You may hand-deliver written (5) Any foreseeable economic, Attention to and protection of habitat comments to our office, at the above national security, or other potential is paramount to successful conservation address. impacts resulting from the proposed actions. The role that designation of 3. You may send comments by designation and, in particular, any critical habitat plays in protecting electronic mail (e-mail) to impacts on small entities; and habitat of listed species, however, is [email protected]. Please (6) Whether our approach to often misunderstood. There are see the ‘‘Public Comments Solicited’’ designating critical habitat could be significant limitations on the regulatory section under SUPPLEMENTARY improved or modified in any way to effect of designation under Act section INFORMATION for file format and other provide for greater public participation 7(a)(2). In brief, (1) designation provides information about electronic filing. and understanding, or to assist us in additional protection to habitat only 4. You may fax your comments to accommodating public concerns and where there is a Federal nexus; (2) the 850–763–2177. comments. protection is relevant only when, in the

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absence of designation, destruction or controversial. The current statutory of preparation and publication of the adverse modification of the critical framework of critical habitat, combined designation, the analysis of the habitat would in fact take place (in other with past judicial interpretations of the economic effects and the cost of words, other statutory or regulatory statute, make critical habitat the subject requesting and responding to public protections, policies, or other factors of excessive litigation. As a result, comment, and in some cases the costs relevant to agency decision-making critical habitat designations are driven of compliance with the National would not prevent the destruction or by litigation and courts rather than Environmental Policy Act (NEPA; 42 adverse modification); and (3) biology, and made at a time and under U.S.C. 4371 et seq.). These costs, which designation of critical habitat triggers a time frame that limits our ability to are not required for many other the prohibition of destruction or adverse obtain and evaluate the scientific and conservation actions, directly reduce the modification of that habitat, but it does other information required to make the funds available for direct and tangible not require specific actions to restore or designation most meaningful. conservation actions. improve habitat. In light of these circumstances, the Currently, only 475 species, or 36 Service believes that additional agency Background percent of the 1,311 listed species in the discretion would allow our focus to In this proposed rule, we intend to U.S. under the jurisdiction of the return to those actions that provide the discuss only information about the Service, have designated critical habitat. greatest benefit to the species most in seven mussels that is directly relevant to We address the habitat needs of all need of protection. the designation of critical habitat. For 1,311 listed species through more information about these seven Procedural and Resource Difficulties in conservation mechanisms such as mussels, please refer to our final rule Designating Critical Habitat listing, section 7 consultations, the listing fat threeridge, shinyrayed section 4 recovery planning process, the We have been inundated with pocketbook, Gulf moccasinshell, section 9 protective prohibitions of lawsuits for our failure to designate Ochlockonee moccasinshell, and oval unauthorized take, section 6 funding to critical habitat, and we face a growing pigtoe as endangered, and Chipola the States, the section 10 incidental take number of lawsuits challenging critical slabshell and purple bankclimber as permit process, and cooperative, non- habitat determinations once they are threatened published in the Federal regulatory efforts with private made. These lawsuits have subjected the Register on March 16, 1998 (63 FR landowners. The Service believes that it Service to an ever-increasing series of 12664) and to our final recovery plan, is these measures that may make the court orders and court-approved which is available from the Panama difference between extinction and settlement agreements, compliance with City, Florida Fish and Wildlife Office or survival for many species. which now consumes nearly the entire online at http://www.fws.gov/ In considering exclusions of areas listing program budget. This leaves the endangered/recovery/Index.html#plans. proposed for designation, we evaluated Service with little ability to prioritize its The purple bankclimber (Elliptoideus the benefits of designation in light of activities to direct scarce listing sloatianus), Gulf moccasinshell Gifford Pinchot Task Force v. United resources to the listing program actions (Medionidus penicillatus), Ochlockonee States Fish and Wildlife Service (378 F. with the most biologically urgent moccasinshell (Medionidus 3d 1059 (9th Cir 2004). In that case, the species conservation needs. simpsonianus), oval pigtoe (Pleurobema Ninth Circuit invalidated the Service’s The consequence of the critical pyriforme), shinyrayed pocketbook regulation defining ‘‘destruction or habitat litigation activity is that limited (Lampsilis subangulata), Chipola adverse modification of critical habitat.’’ listing funds are used to defend active slabshell (Elliptio chipolaensis), and fat In response, on December 9, 2004, the lawsuits, to respond to Notices of Intent threeridge (Amblema neislerii) are Director issued guidance to be (NOIs) to sue relative to critical habitat, variously distributed in four river basins considered in making section 7 adverse and to comply with the growing number that flow into the northeast Gulf of modification determinations. This of adverse court orders. As a result, Mexico: Econfina Creek, Apalachicola proposed critical habitat designation listing petition responses, the Service’s River (a large basin generally labeled does not use the invalidated regulation own proposals to list critically with the names of its major tributaries, in our consideration of the benefits of imperiled species, and final listing the Chattahoochee and Flint rivers, as including areas in this final designation. determinations on existing proposals are the ACF River Basin), Ochlockonee Rather, it relies on the guidance issued all significantly delayed. River, and Suwannee River. by the Director in response to the The accelerated schedules of court- The endangered fat threeridge is a Gifford Pinchot decision (see ‘‘Adverse ordered designations have left the medium-sized to large, subquadrate, Modification Standard’’ discussion Service with limited ability to provide inflated, solid, and heavy-shelled below). The Service will carefully for public participation or to ensure a mussel that reaches a length of 10.2 manage future consultations that defect-free rulemaking process before centimeters (cm) (4.0 inches (in)). Large analyze impacts to designated critical making decisions on listing and critical specimens are so inflated that the width habitat, particularly those that appear to habitat proposals, due to the risks approximates the height. The umbos be resulting in an adverse modification associated with noncompliance with (bulges near the hinge of the shell) are determination. Such consultations will judicially imposed deadlines. This in in the anterior quarter of the shell. The be reviewed by the Regional Office prior turn fosters a second round of litigation dark brown to black shell is strongly to finalizing to ensure that an adequate in which those who fear adverse sculptured with seven or eight analysis has been conducted that is impacts from critical habitat prominent horizontal parallel plications informed by the Director’s guidance. designations challenge those (ridges). On the other hand, to the extent that designations. The cycle of litigation The endangered shinyrayed designation of critical habitat provides appears endless and is expensive, thus pocketbook is a medium-sized mussel protection, that protection can come at diverting resources from conservation that reaches approximately 8.4 cm (3.3 significant social and economic cost. In actions that may provide relatively more in) in length. The shell is generally addition, the mere administrative benefit to imperiled species. elongated, with broad, somewhat process of designation of critical habitat The costs resulting from the inflated umbos and a rounded posterior is expensive, time-consuming, and designation include legal costs, the cost ridge. The shell is thin but solid. The

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surface is smooth and shiny and ranges Suwannee. Morphological variation respiration and food collection. Known from straw-yellow to chestnut-brown across this broad range has led to the food items include detritus with a variable number of black to description of several nominal species (disintegrated organic debris), diatoms, bright emerald-green rays, which since it was originally described as Unio phytoplankton, zooplankton, and other emanate from the umbo across the disk. pyriformis (Lea 1857, p. 169–172). microorganisms (Coker et al. 1921, p. The shinyrayed pocketbook was listed Williams and Butler (1994, p. 111) 88; Churchill and Lewis 1924, p. 462; as federally endangered under the recognized the form distributed in the Fuller 1974, p. 221). Adults are filter scientific name Lampsilis subangulata. Ochlockonee and Suwannee River feeders and generally orient themselves The shinyrayed pocketbook and three systems as the Florida pigtoe, on or near the substrate surface to take other Lampsilis species that are not Pleurobema reclusum (Wright 1898, p. food and oxygen from the water above federally listed are now assigned to the 111–112), consistent with Simpson them (Kraemer 1979, p. 1085–1096). newly recognized genus Hamiota (Roe (1914, p. 1–1540). However, Turgeon et Juveniles typically burrow completely and Hartfield 2005, p. 1). Several al. (1998, p. 36) recognized the forms beneath the substrate surface and are characteristics, including glochidia from all four basins as one species, P. pedal (foot) feeders (bringing food packaging in a superconglutinate, pyriforme, which was the taxonomic particles inside the shell for ingestion placement and shape of the marsupia, classification upon which we relied on that adhere to the foot while it is and glochidia release through the for the 1998 final rule listing this extended outside the shell) until the excurrent siphon, support recognition of species as endangered. A recent study structures for filter feeding are more these species as a distinct genus (Roe using molecular genetic techniques fully developed (Gatenby et al. 1996, p. and Hartfield 2005, p. 1), and we plan compared tissue samples from three of 604; Yeager et al. 1994, p. 221). to implement the name change in a the four basins (Econfina Creek, ACF, Sexes in unionid mussels are usually separate rule-making. and Suwannee), and concluded that the separate. Males release sperm into the The endangered Gulf moccasinshell is Suwannee samples were distinctive and water, which females take in through a small mussel that reaches a length of warranted specific status as P. reclusum their siphons during feeding and about 5.6 cm (2.2 in), is elongate- (Kandl et al. 2001, p. 10). We respiration. Eggs are fertilized and elliptical or rhomboidal in outline, acknowledged these findings in our retained in the gills of the female until fairly inflated, and has relatively thin 2003 final recovery plan, but have the larvae (glochidia) fully develop. The valves. The ventral margin is nearly deferred any revisions to the listing glochidia of most unionid species, straight or slightly rounded. The taxonomy pending review of an analysis including all seven species addressed in posterior ridge is rounded to slightly that includes samples from the this proposed rule, require a parasitic angled and intersects the end of the Ochlockonee Basin as well. Peer review stage on the fins, gills, or skin of a fish shell at the base line. Females tend to and publication of a genetic analysis of to transform into juvenile mussels (for have the posterior point above the samples from all four basins is expected species-specific information, see ventral margin and are more inflated sometime in 2006 (J.D. Williams, USGS, ‘‘Primary Constituent Elements—Fish than males. pers. comm. 2005). Hosts’’). Females release glochidia The endangered Ochlockonee The threatened Chipola slabshell is a either separately or in masses termed moccasinshell is small, generally under medium-sized species reaching a length conglutinates, depending on the mussel 5.6 cm (2.2 in) long. It is slightly of about 8.4 cm (3.3 in). The shell is species. Exceptionally large elongate-elliptical in outline, the ovate to subelliptical, somewhat conglutinates, such as those of the posterior end obtusely rounded at the inflated, and with the posterior ridge shinyrayed pocketbook, are termed median line, and the ventral margin starting out rounded but flattening to superconglutinates. The duration of the broadly curved. The posterior ridge is form a prominent biangulate margin. parasitic stage varies by mussel species, moderately angular and covered in its The periostracum is smooth and water temperature, and perhaps host entire length with well-developed, chestnut-colored. Dark brown coloration fish species. When the transformation is irregular plications. Sculpturing may may appear in the umbo region, and the complete, juvenile mussels normally also extend onto the disk below the remaining surface may exhibit detach from their fish host and sink to ridge. The periostracum (outside surface alternating light and dark bands. the stream bottom where, given suitable of the shell) is smooth. The color is light The threatened purple bankclimber is conditions, they grow and mature to the brown to yellowish green, with dark a large, heavy-shelled, strongly adult form. green rays formed by a series of sculptured mussel reaching lengths of Distribution connected chevrons or undulating lines 20.5 cm (8.0 in). A well-developed across the length of the shell. posterior ridge extends from the umbo The historical and current range of the The endangered oval pigtoe is a small- to the posterior ventral margin of the seven mussels includes portions of four to-medium-sized mussel that attains a shell. The posterior slope and the disk river basins of the northeast Gulf of length of about 6.1 cm (2.4 in). The shell just anterior to the posterior ridge are Mexico in Alabama, Florida, and is suboviform and compressed. The sculptured by several irregular Georgia: Econfina Creek, ACF, periostracum is shiny smooth; plications that vary greatly in Ochlockonee, and Suwannee. Of these yellowish, chestnut, or dark brown; development. The umbos are low, four basins, the ACF is the largest and rayless; and with distinct growth lines. extending just above the dorsal margin the only one that extends beyond the The posterior slope is biangulate and of the shell. Coastal Plain physiographic province forms a blunt point on the posterior into the Piedmont of Georgia and margin. The umbos are slightly elevated Life History Alabama. Two or more of the seven above the hingeline. The seven mussels are all bivalve mussels occur in each of the four basins, The endangered oval pigtoe is the mollusks (clams) of the family except the Suwannee, in which only the only species among the seven mussels Unionidae. Unionid mussels generally oval pigtoe is found. Because large of this proposed rule that occurs in all live embedded in the bottom of rivers, reservoirs are unsuitable as habitat for four Gulf of Mexico river basins streams, and other bodies of water. They these mussels and the dams that comprising their collective range: siphon water into their shells and across impound them are barriers to the Econfina Creek, ACF, Ochlockonee, and four gills that are specialized for movement of their host fishes, their

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range within two of the basins (ACF and bed elevation of the Apalachicola River 2003). Channel instability induced by Ochlockonee) is divided into two or downstream of Jim Woodruff Lock and gravel mining has probably played a more sub-basins that likely represent the Dam, which is located at the confluence significant role in extirpating the Gulf maximum spatial extent of potentially of the Chattahoochee and Flint rivers, moccasinshell and oval pigtoe from the interbreeding populations. We estimate has degraded about 1.2 to 1.5 meters (m) Uchee Creek system (Howard 1997, p. that the five species listed as (4 to 5 feet (ft)) since its construction in 157), where a small population of the endangered are each extirpated from the late 1950s (Light et al. 1998, p. 21). shinyrayed pocketbook persists. A over half of their historical ranges, and The main channel of the river widened recent Service stream habitat condition the two threatened species are at a rate of about 0.45 m (1.5 ft) per year, survey in the Ochlockonee Basin found extirpated from about one-third of their based on cross sections measured by the evidence of substantial channel historical ranges (USFWS 2003, p. 77). U.S. Army Corps of Engineers (USACE) instability (actively eroding banks) at between 1980 and 2001 (USACE 2002, only 9 of 181 sites surveyed, but Summary of Threats to Surviving p. 1.1–8.3). The Apalachicola River near classified over half of the sites (99) as Populations the Chattahoochee-Flint confluence having a moderate risk of bank erosion The declining range and abundance of once supported a particularly rich (H. Blalock-Herod, Service, pers. comm. the seven mussels is due mostly to mussel bed, which included large 2006). changes in their riverine habitats numbers of fat threeridge and purple Sedimentation resulting from dams, dredging, mining, bankclimber, but this bed had declined channelization, pollution, substantially in diversity and numbers Sedimentation is widely reported as a sedimentation, and water withdrawals, by the early 1970s (Heard 1975, p. 1– contributing factor in the decline of and possibly also the introduction of 31). Although the purple bankclimber stream mussel populations (Kunz 1898, nonnative species, such as the Asian persists, the fat threeridge is now rare in p. 328; Ellis 1931, p. 5; 1936, p. 29; clam. Each of these threats affect one or the upper river (Brim Box and Williams Imlay 1972, p. 76; Coon et al. 1977, p. more of the physical and biological 2000, p. 89). Quantitative sampling 279; Marking and Bills 1979, p. 204; habitat features that we have identified using substrate sieves at two locations Dennis 1985, p. 1–171; Aldridge et al. as essential to the conservation of the in the upper river failed to detect 1987, p. 17; Schuster et al. 1989, p. 84; seven mussels, which we discuss in juveniles of any unionid mussels Wolcott and Neves 1990, p. 74; Houp detail under ‘‘Primary Constituent (Richardson and Yokley 1996, p. 137). 1993, p. 93–97; Richter et al. 1997a, p. Elements.’’ The decline of the rich mussel fauna of 1090; Brim Box 1999, p. 1–108). More than 350 kilometers (km) (217 the Chattahoochee River was attributed Sedimentation is the process by which miles (mi)) of large and small river partly to erosion from intensive farming water detaches, transports, and deposits habitat in the ACF and Ochlockonee before the Civil War (van der Schalie soil materials on the substrates of basins within the current range of the 1938, p. 56; Clench 1955, p. 96), streams, lakes, and wetlands. In seven mussels is inundated by although substantial erosion continued geomorphically stable stream reaches, reservoirs. None of the seven species are for several more decades (Glenn 1911, p. sediment input is balanced by sediment known to persist in impoundments, 1–137; Trimble 1972, p. 454–457). The output, resulting in no net accumulation although a single purple bankclimber most striking example of this erosion or loss of sediment from the stream bed. was found in an impounded portion of and resulting stream channel instability Sediment input is increased by a variety the Chattahoochee River (C. is in the headwaters of Turner Creek, a of human activities that are common in Stringfellow, Columbus State Chattahoochee River tributary in the range of the seven mussels. University, pers. comm. 2000). Obligate Stewart County, Georgia. The massive Substantial sediment accumulation is riverine fishes, some of which may amount of sediment that washed away one factor that may induce channel serve as hosts for larvae of the seven was conveyed via Turner Creek over instability. Lesser amounts may also mussels, are also eliminated by dams time to the Chattahoochee River. adversely affect substrate quality for and impoundments. Several mussels by altering its texture (usually populations of the seven species persist Channelization by increasing the percentage of fine in relatively small fragments of the four Channelization (straightening a materials) and by introducing harmful major river basins that are isolated from stream course by artificial cutoffs and pollutants. other populations by impoundments or other means for flood control and Waters (1995, p. 173–176) reviewed other large patches of unsuitable habitat navigation), dredging, snagging (removal the biological effects of sediments in and by dams or other barriers to of large woody debris), in-stream gravel streams, and Mount (1995, p. 1–359) dispersal via their fish hosts. Habitat mining, and other forms of direct stream provided an overview of the effects of fragmentation reduces the probability of channel modifications may induce various land uses on stream systems. population persistence (Wilcox and channel instability. A well-documented Brim Box and Mossa (1999, p. 99–117) Murphy 1985, p. 879–884), because example of how direct modifications to reviewed the effects of sediments and smaller, more isolated populations are a stream induced substantial instability land uses specifically on mussels. They less able to rebound from chance is the Homochitto River in Mississippi, identified several activities that may adverse environmental, demographic, which incised 5 m (16.4 ft) and widened affect mussels through sedimentation, and genetic events (Shaffer 1981, p. 131; 450 percent following channelization including logging, farming, ranching, Lande 1988, p. 1455). (Kesel and Yodis 1992, p. 99). Hartfield mining, and urbanization. Without A variety of activities may induce (1993, p. 131–141) and Neves et al. adequate measures to control erosion, channel instability that adversely affects (1997, p. 71–72) reviewed the adverse these activities may deliver sediment to habitat conditions for mussels. Because effects of channel modifications on streams via upland gullies, unpaved impoundments block the natural freshwater mollusks. Dredging in the roads, road-side ditches, construction downstream movement of sediment, Apalachicola River to maintain sites, and other areas of soil disturbance. channel degradation is commonly navigability may be contributing to All of these activities are widespread in observed in the tailwaters of dams observed channel instability in that the current range of the seven mussels. (Williams and Wolman 1984, p. 14; system (letter from G. Carmody, Service, Sediment samples from several ACF Lignon et al. 1995, p. 187). The mean to R. Keyser, USACE, dated August 8, Basin streams contained elevated

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concentrations of two heavy metals that Water Withdrawals assessments under Section 305(b) of the are harmful to mussels: Copper (found Water withdrawals for agricultural, Clean Water Act (CWA). Although water throughout the Piedmont) and cadmium municipal, and industrial use may quality in the smallest of the four (found in large Coastal Plain tributaries reduce stream flow and affect mussels. basins, Econfina Creek, is generally of the Flint River) (Frick et al. 1998, p. In the Dougherty Plain of the lower Flint good, mercury accumulation in fish 19). Elevated concentrations of heavy River Basin and upper Chipola River populations was cited as a potential metals (such as chromium and Basin, irrigated agriculture is the largest impairment in Florida’s most recent cadmium) were measured in Asian consumptive water use (Marella et al. basin status report (FDEP 2003a, p. 71). clams and in sediment samples 1993, p. 6, 13, 29, 42). Major crops in Barrios and Chelette (2004, p. 7) collected downstream of two abandoned the region include cotton, peanuts, corn, described the hydrologic setting of battery salvage operations on the and soybeans, with the largest acreage Econfina Creek, which strongly Chipola River (Winger et al. 1985, p. irrigated by groundwater using center influences its water quality 141, 144). Farther downstream in the pivot sprinkler systems. Due to the characteristics. Except during periods of Chipola River, the chromium porous limestone underlying this area, high rainfall, most of the flow in concentrations found in the sediments ground and surface waters are highly Econfina Creek derives from the of Dead Lake (Winger et al. 1985, p. 141, connected, and the base flow of many discharge of a series of at least 39 spring 144) are toxic to mussels (Havlik and streams is supported by the discharge of vents from the Floridan Aquifer in the Marking 1987, p. 1–20). springs (Torak et al. 1996, p. 1–106). middle section of the creek. The ground water contribution zone for these Impoundments This area is also the center of the current range of several of the seven springs is large and encompasses a significant portion of the creek’s surface The operations of several dams and mussels. Approximately 172,125 water basin. Water quality in the withdrawals of surface and groundwater hectares (ha) (425,000 acres (ac)) of Floridan Aquifer is vulnerable to land may alter flow regimes to a degree that cropland were irrigated using center use activities in this contribution zone. adversely affects mussels. Four portions pivot systems in a 16-county area of of the range of the seven mussels are Georgia in the lower Flint River Basin, Water quality in the largest of the four immediately downstream of major with an additional 30,375 ha (75,000 ac) basins, the ACF, varies considerably. mainstem dams. The Apalachicola River irrigated with surface waters (Litts et al. Two small portions of the seven is downstream of Jim Woodruff Lock 2001, p. 23). Using models representing mussels’ current range in the ACF are and Dam (JWLD), which impounds Lake surface water—groundwater dynamics within the State of Alabama: The entire Seminole, a large but shallow reservoir in the lower Flint–upper Chipola area, Uchee Creek watershed (a in the southwest corner of Georgia with Albertson and Torak (2002, p. 22) found Chattahoochee River tributary) and the a storage capacity of about 86 million that 8 of 37 streams examined (7 of headwaters of the Chipola River meters3 (70,000 acre-feet). Seminole is these 37 support listed mussels) were watershed (an Apalachicola River the downstream-most reservoir in a highly sensitive to groundwater tributary). In the latter, the Alabama series of much larger reservoirs on the withdrawal and that during droughts Department of Environmental Chattahoochee River with a cumulative these streams may go dry. Management (2004, p. 7) reports that capacity of about 2.2 billion m3 (1.8 Water supply for municipal and Cypress Creek is impaired due to million ac-ft), which represents about 11 industrial needs are greatest in the areas organic enrichment and low dissolved oxygen (DO). We have no records of the percent of the average annual discharge of greatest human population. Several seven mussels in Cypress Creek; from JWLD (USACE 1998, p. 4.10, 4.48, large urban areas (population greater however, three of the species are known 4.56). During extended periods without than 100,000) are near or within the to occur within a few miles downstream substantial rainfall, however, as during current range of the seven mussels, of its mouth. In the Florida portion of 1999 to 2002, the flow of the including Dothan, Alabama; Panama the ACF, several stream segments that Apalachicola River may consist mostly City and Tallahassee, Florida; and support one or more of the seven of releases from storage in the Albany, Atlanta, and Columbus, mussels in the Chipola and Chattahoochee reservoirs. Georgia. The largest of these is the Atlanta metro area, which extends into Apalachicola watersheds are potentially The Flint River is impounded by two the headwaters of the Flint River Basin. impaired due to excessive coliform mainstem reservoirs, Lake Blackshear Population in the 16-county metro area bacteria, nutrients, un-ionized and Lake Worth. By impeding passage is forecast to increase from about 4 ammonia, or turbidity (FDEP 2003b, p. of host fishes, these dams separate million people in 2000 to about 8 1–208). Mercury-based fish advisories individuals of the shinyrayed million in 2030, when regional water apply to one or more segments of both pocketbook, Gulf moccasinshell, oval planning authorities predict water watersheds. The current range of the pigtoe, and purple bankclimber into at demand will equal available water seven mussels in the Flint River Basin least three populations within the basin. supply from existing and presently includes 131 km (81 mi) that are Both dams are used for hydropower and planned sources (Ashley 2005, p. 1). reported as not supporting or partially are licensed to operate generally in a Water use will likely increase along supporting designated uses due to run-of-river mode (releases with increasing human population in departures from Georgia’s standards for approximately equal reservoir inflow) each of the four basins that support the DO or biological integrity, or are under (USACE 1998, p. 4.48, 4.56), but short- seven mussels. mercury-based fish consumption term alterations of river flow may occur. advisories (GDNR–EPD 2002, p. 1/1–9/ A mainstem dam on the Ochlockonee Water Quality 2). The streams listed include such Flint River creates Lake Talquin, which is Water quality is reported as impaired River tributaries as Spring Creek and licensed and operated in a similar or potentially impaired in some portions Kinchafoonee Creek, but not the fashion. No dams have been constructed of all four river basins within the mainstem. The conditions in an on Econfina Creek or the Suwannee current range of the seven mussels, additional 58 km (36 mi) of Flint River River and its major tributaries within according to the water quality agencies tributaries occupied by the mussels the range of the seven mussels. of the three States in their periodic violate the coliform bacteria standard.

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Water quality is considered impaired were found to exceed criteria for Non-Native Species in a majority of the mussels’ range in the protection of aquatic life. Asian Clam Ochlockonee River Basin of Florida and Many pollutants in the ACF Basin The invasion of non-native aquatic Georgia. In both States, the entire originate from urban stormwater runoff, mainstem length of the river is impaired species has contributed to the decline of developmental activities, and municipal or potentially impaired by excessive several North American mussel species waste water facilities, primarily coliform bacteria or nutrients, low DO, (Neves et al. 1977, p. 72–75; Strayer or is under mercury-based fish upstream of the fall line (the line 1999, p. 74). Some native mussels may consumption advisories (FDEP 2003c, p. marking the relatively abrupt elevation go extinct due to the continued spread 1–141; GDNR—EPD 2002, p. 1/1–9/2). A transition between the Piedmont of the zebra mussel (Dreissena study of water and sediment quality in physiographic province and the coastal polymorpha), a species not yet the basin in relation to mussels found plain) (Frick et al. 1998, p. 1–36). Urban established in the southeast (Ricciardi et that sites with low DO or elevated levels catchments in Piedmont drainages have al. 1998, p. 618). Another non-native of lead, manganese, or ammonia no higher concentrations of nutrients, bivalve, the Asian clam (Corbicula longer supported their historical mussel heavy metals, pesticides, and organic fluminea), is well-established and assemblages, including the listed compounds than do agricultural or almost ubiquitous in the range of the species (Hemming et al. 2005, p. 2). forested ones (Lenat and Crawford 1994, seven mussels. Reports of Asian clam The range of the seven mussels in the p. 185; Frick et al. 1998, p. 1–36), and density vary considerably, from 9 per Suwannee River Basin is limited to one at levels sufficient to affect fish health square foot (Flint River, Sickel 1973, p. species (the oval pigtoe), to the Florida (Ostrander et al. 1995, p. 213). Couch et 11) to over 195 per square foot (Santa Fe portion of the basin, and to one al. (1996, p. 50) counted 137 municipal River, Bass and Hitt 1974, p. 16). In the New River (Suwannee River drainage), watershed within that portion (the Santa wastewater treatment facilities in the Blalock and Herod (1999, p. 145–151) Fe River watershed). The oval pigtoe is ACF Basin. currently known only from the New found an overall density of 8 Asian River and a short segment of Santa Fe Host Fish clams per square foot in an area where itself downstream of the mouth of the oval pigtoe density was 0.003 per square New River. Most of the New River was Collectively, eight species of fish are foot (Blalock-Herod 2000, p. 1–72). In listed as impaired due to excessive now considered probable primary hosts one reach of the Apalachicola River coliform bacteria, excessive nutrients, for the larval life stage of four of the immediately downstream of Jim and low DO in 1998, and remains seven mussels: Largemouth bass, Woodruff Lock and Dam, the stream bed potentially impaired under Florida’s spotted bass, bluegill, redear sunfish, is almost entirely covered with a layer current standards (FDEP 2003d, p. 1– weed shiner, sailfin shiner, blackbanded of live and dead Asian clams several 159). darter, and brown darter (O’Brien and inches deep (J. Ziewitz, personal Agricultural sources of contaminants Brim Box 1999, p. 136; O’Brien and observation). Several researchers have in the ACF and Suwannee basins Williams 2002, p. 150–152) (see suggested that the Asian clam competes include nutrient enrichment from ‘‘PCEs—Fish Hosts’’). According to Lee with native mussels for food, nutrients, poultry farms and livestock feedlots, et al. (1980, p. 1–854), the range of each and space (Heard 1977, p. 1–177; and pesticides and fertilizers from row of these fishes encompasses the range of Kraemer 1979, p. 1094; Clarke 1986, p. crop agriculture (Couch et al. 1996, p. the respective mussel(s) that 8), particularly with juvenile unionids 1–58; Frick et al. 1998, p. 1–36; Berndt (Neves and Widlak 1987, p. 6). Yeager successfully parasitized each species in et al. 1998, p. 1–32). A study by the U.S. et al. (2000, p. 257) determined that laboratory tests, with the possible Soil Conservation Service (1993, p. 26) high densities of Asian clams reduced (now the Natural Resources exception of the sailfin shiner—oval survival and growth of newly Conservation Service) in the Flint River pigtoe association. The sailfin shiner metamorphosed juvenile mussels. system determined that between 72 and does not occur far upstream of the fall However, Asian clams are present at 75 percent of the nutrients entering Lake line in the ACF basin (B. Albanese, GA almost all locations where the seven Blackshear were derived from DNR Wildlife Division, pers. comm. mussels for which we are proposing agricultural sources. Organochlorine 2006), but the oval pigtoe does; critical habitat in this proposed rule are pesticides were found at levels in ACF therefore, at least one more fish likely currently found, and the specific impact Basin streams that often exceeded serves as a host for this species. None of this species upon native mussels is chronic exposure criteria for the of the eight fishes is protected under the largely unresolved (Leff et al. 1990, p. protection of aquatic life (Buell and Act or considered imperiled rangewide 415; Strayer 1999, p. 90). Couch 1995, p. 1; Frick et al. 1998, p. (Williams et al. 1989, p. 2–20); however, Black Carp 11). Cotton is raised in much of the Georgia recognizes the sailfin shiner as region inhabited by these mussels. One a species of special concern (State rank The black carp (Mylopharyngodon of the most important pesticides used in ‘‘S3’’; rare or uncommon in State). The piceus) is another introduced species cotton farming, malathion, affects four centrarchid fishes (the two basses, that may pose a threat to the seven mussels physiologically and may bluegill, and redear sunfish) are each mussels. Largest of the Asiatic carp species, the black carp eats mollusks decrease respiration and feeding ability classified as game species by the three (snails and mussels), and sterile fish are (Kabeer et al. 1979, p. 71–73). Within States. Riverine fish populations in the the Suwannee River basin, nutrient sometimes used in catfish aquaculture southeast generally have been adversely concentrations were greater in to control snails that are the affected by a variety of the same habitat agricultural areas and nitrates were intermediate hosts of a catfish parasite found to exceed U.S. Environmental alterations that have contributed to the (Nico et al. 2001, p. 1–124). Escape of Protection Agency (USEPA) drinking decline of the region’s mussel fauna substantial numbers of the sterile fish water standards in 20 percent of the (Etnier 1997, p. 91; Neves et al. 1997, p. could significantly reduce numbers of surficial aquifer groundwater samples 60; Warren et al. 1997, p. 106, 123–125, native mussels where the escape occurs, (Berndt et al. 1998, p. 6). Mostly in 127, 131). and the establishment of non-sterile urban areas, pesticide concentrations black carp in the wild could

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conceivably extirpate entire mussel designation does not allow government Appropriations Act for Fiscal Year 2001 populations. or public access to private lands. (Pub. L. 106–554; H.R. 5658) and the To be included in a critical habitat associated Information Quality Previous Federal Actions designation, the habitat within the area Guidelines issued by the Service. We listed the seven mussels under the occupied by the species must first have Section 4 of the Act requires that we Act on March 16, 1998 (63 FR 12664), features that are essential to the designate critical habitat on the basis of and approved a final recovery plan for conservation of the species. Critical the best scientific data available. Habitat the seven species on September 19, habitat designations identify, to the is often dynamic, and species may move 2003 (68 FR 56647; October 1, 2003). In extent known using the best scientific from one area to another over time. the final 1998 rule, we determined that data available, habitat areas that provide Furthermore, we recognize that designation of critical habitat was not essential life cycle needs of the species designation of critical habitat may not prudent. On March 15, 2004, the Center (areas on which are found the primary include all of the habitat areas that may for Biological Diversity (Center) filed a constituent elements, as defined at 50 eventually be determined to be lawsuit in the U.S. District Court for the CFR 424.12(b)). necessary for the recovery of the Northern District of Georgia (Civil Habitat occupied at the time of listing species. For these reasons, critical Action No. 1:04 CV–0729–GET) alleging may be included in critical habitat only habitat designations do not signal that that we violated the Act by failing to if the essential features thereon may habitat outside the designation is designate critical habitat for the seven require special management or unimportant or may not be required for mussels. We entered a settlement protection. Thus, we do not include recovery. agreement with the Center on August areas where existing management is Areas that support populations, but 31, 2004, which stipulates that the sufficient to conserve the species. are outside the critical habitat Service would submit for publication in Accordingly, when the best available designation, will continue to be subject the Federal Register, on or before May scientific data do not demonstrate that to conservation actions implemented 30, 2006, a new prudency the conservation needs of the species so under section 7(a)(1) of the Act and to determination, and if designation was require, we will not designate critical the regulatory protections afforded by determined to be prudent, a proposed habitat in areas outside the geographical the section 7(a)(2) jeopardy standard, as rule designating critical habitat. This area occupied by the species at the time determined on the basis of the best publication is our new prudency of listing. An area currently occupied by available information at the time of the determination and our proposed rule the species but was not known to be action. Federally funded or permitted designating critical habitat for the seven occupied at the time of listing is likely, projects affecting listed species outside mussels. but not always, essential to the their designated critical habitat areas conservation of the species and is may still result in jeopardy findings in Critical Habitat typically included in the critical habitat some cases. Similarly, critical habitat Critical habitat is defined in section 3 designation. designations made on the basis of the of the Act as—(i) the specific areas The Service’s Policy on Information best available information at the time of within the geographical area occupied Standards Under the Endangered designation will not control the by a species, at the time it is listed in Species Act, published in the Federal direction and substance of future accordance with the Act, on which are Register on July 1, 1994 (59 FR 34271), recovery plans, habitat conservation found those physical or biological and Section 515 of the Treasury and plans, or other species conservation features (I) essential to the conservation General Government Appropriations planning efforts, if new information of the species and (II) that may require Act for Fiscal Year 2001 (Pub. L. 106– available to these planning efforts calls special management considerations or 554; H.R. 5658) and the associated for a different outcome. protection; and (ii) specific areas Information Quality Guidelines issued outside the geographical area occupied by the Service, provide criteria, Prudency Determination by a species at the time it is listed, upon establish procedures, and provide Section 4(a)(3) of the Act and its a determination that such areas are guidance to ensure that decisions made implementing regulations (50 CFR essential for the conservation of the by the Service represent the best 424.12) require that, to the maximum species. Conservation, as defined under scientific data available. They require extent prudent and determinable, we section 3 of the Act, means to use and Service biologists to the extent designate critical habitat at the time a the use of all methods and procedures consistent with the Act and with the use species is listed as endangered or which are necessary to bring any of the best scientific data available, to threatened. Our regulations at 50 CFR endangered species or threatened use primary and original sources of 424.12(a)(1) state that the designation of species to the point at which the information as the basis for critical habitat is not prudent when one measures provided pursuant to the Act recommendations to designate critical or both of the following situations exist: are no longer necessary. habitat. When determining which areas (1) The species is threatened by taking Critical habitat receives protection are critical habitat, a primary source of or other activity and the identification under section 7 of the Act through the information is generally the listing of critical habitat can be expected to prohibition against destruction or package for the species. Additional increase the degree of threat to the adverse modification of critical habitat information sources include the species; or (2) such designation of with regard to actions carried out, recovery plan for the species, articles in critical habitat would not be beneficial funded, or authorized by a Federal peer-reviewed journals, conservation to the species. In our March 16, 1998, agency. Section 7 requires consultation plans developed by States and counties, final rule (63 FR 12664), we determined on Federal actions that are likely to scientific status surveys and studies, that designating critical habitat was not result in the destruction or adverse biological assessments, or other prudent for the seven mussels because modification of critical habitat. The unpublished materials and expert it would result in no known benefit to designation of critical habitat does not opinion or personal knowledge. All the species and could further pose a affect land ownership or establish a information is used in accordance with threat to them through publication of refuge, wilderness, reserve, preserve, or the provisions of Section 515 of the their site-specific localities. However, other conservation area. Such Treasury and General Government several of our determinations that the

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designation of critical habitat would not rule for the seven mussels; and our final 424.12, we are required to base critical be prudent have been overturned by recovery plan for the seven mussels. habitat determinations on the best court decisions (for example, Our principal sources of information scientific and commercial data available Conservation Council for Hawaii v. for identifying the specific areas within and to consider within areas occupied Babbitt (2 F. Supp. 2d 1280 [D. Hawaii the occupied range of the seven mussels by the species at the time of listing those 1998]); and Natural Resources Defense on which are found those features physical and biological features that are Council v. U.S. Department of the essential to their conservation were: the essential to the conservation of the Interior (113 F. 3d 1121, 1125 [9th Cir. collective database of locality records species (PCEs), and that may require 1997])). for the seven mussels, which is special management considerations or We are already working with Federal tabulated in our 2003 final recovery protection. These include, but are not and State agencies, private individuals, plan and has been supplemented with limited to: Space for individual and and organizations in carrying out surveys completed since then, and the population growth and for normal conservation activities for the seven peer-reviewed scientific literature on behavior; food, water, air, light, mussels, conducting surveys for mussels’ life history and habitat minerals, or other nutritional or additional occurrences, and assessing requirements. Our 1998 final listing rule physiological requirements; cover or habitat conditions. However, critical relied extensively upon data obtained in shelter; sites for breeding, reproduction, habitat designation may provide a rangewide status survey of the seven and rearing (or development) of additional information to individuals, mussels commissioned by the Service offspring; and habitats that are protected local and State governments, and other and conducted in 1991 and 1992 (cited from disturbance or are representative of entities engaged in long-range planning, as Butler (1993, p. 1–30) in the final the historic geographical and ecological since areas with features essential to the listing). Most of these data were taken distributions of a species. conservation of the species are clearly in the ACF basin and have since been The specific PCEs essential for the delineated and, to the extent currently published by Brim Box and Williams seven mussels are derived from their feasible, the primary constituent (2000, p. 3). Although mussel surveys biological needs as described in the elements of the habitat necessary to the have been conducted since publication Background section of this proposal. survival of the subspecies are of the final listing rule at various Space for individual and population specifically identified. Furthermore, locations in the four river basins that growth and normal behavior, and sites although the low numbers of these encompass their known range, the for reproduction and development of 1991–1992 status survey still provides a offspring are provided for the seven mussels make it unlikely that their majority of the most recent mussels on and within the streambed of populations could withstand even distributional records for these seven stable channels with a suitable moderate collecting pressure or mussels. For purposes of this proposed substrate, which we have captured in vandalism, we do not have specific rule, the Service considers the most the PCEs regarding channel stability, evidence of taking, collection, recent post-1990 survey data at a substrate quality, and flow regime. vandalism, trade, or unauthorized particular location as representing a Because the seven mussels are human disturbance. species’ current presence or absence at dependent on fish to complete their Accordingly, we withdraw our that location, and we consider pre-1990 larval life stage, the PCE regarding fish previous determination that the survey data as representing historical hosts is a further requirement for designation of critical habitat will not distribution. We must extend the successful reproduction. Various benefit the seven mussels and will definition of current distribution back to nutritional and physiological increase the degree of threat to the 1990 because mussels are sedentary, requirements are captured in the PCEs species. We determine that the long-lived animals, some species regarding flow regime and water quality. designation of critical habitat is prudent attaining maximum life spans of 100 to These PCEs are explained in additional for these species. At this time, we have 200 years (Neves and Moyer 1988, detail below. sufficient information necessary to p. 185; Bauer 1992, p. 425; Mutvei et al. Channel Stability identify specific areas that meet the 1994, p. 163–186). It was rare in the definition of critical habitat and are, 1991–1992 survey, and is still rare, to Unstable channels do not favor therefore, proposing critical habitat for find juveniles of the seven mussels. mussels in part because adults and the seven mussels. We relied on a variety of information juveniles are relatively sedentary Methods sources for identifying occupied areas in animals. They are unable to move which the features essential to the quickly or across great distances from As required by section 4(b)(1) of the conservation of the seven mussels may unsuitable to suitable microhabitats on Act, we used the best scientific and require special management and in the stream bed. Several commercial data available in considerations or protection, including researchers have reported direct adverse determining areas that contain the land and water management plans of effects to mussels in aggrading (filling) physical and biological features State and regional government agencies, and degrading (scouring) channels essential to the conservation of the surveys of stream channel condition, (Vannote and Minshall 1982, p. 4106; seven mussels. We reviewed the water quality assessments, and Kanehl and Lyons 1992, p. 7; Hartfield available information pertaining to their distributional information for host 1993, p. 133; Brim Box and Mossa 1999, historical and current distributions, life fishes. We used the sources cited in our p. 99–117). In degrading channels, histories, host fishes, habitats, threats to final recovery plan’s summary of known mussels lose the substrate sediment in mussels in general, and threats to the threats to the seven mussels to identify which they anchor themselves against seven mussels in particular. This which essential features may be most the current. Mussels have been information includes our own site- vulnerable in certain portions of the extirpated from streams experiencing a specific species and habitat data; occupied range. ‘‘headcut’’ (stream bed degradation unpublished survey reports; notes and progressing in an upstream direction) communications with other qualified Primary Constituent Elements and from degrading reaches biologists or experts; peer-reviewed In accordance with section 3(5)(A)(i) immediately downstream of dams. In scientific publications; the final listing of the Act and regulations at 50 CFR aggrading channels or in channels with

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actively eroding stream banks, excess proposed rule are found in a variety of disguising their glochidia as potential sediment fouls the gills of mussels, substrates, ranging from pockets of sand prey items (O’Brien and Brim Box 1999, which reduces feeding and respiratory on bedrock to sandy mud, but not in p. 135–136; O’Brien and Williams 2002, efficiency, disrupts metabolic processes, substrates composed of predominantly p. 154), and some of these mechanisms reduces growth rates, and physically fine materials (more than 50 percent silt appear to require flowing water to smothers mussels (Ellis 1936, p. 39; or clay by dry weight) (Brim Box and function effectively as lures. For Stansbery and Stein 1971, p. 2178; Williams 2000, p. 1–143; Blalock-Herod example, flowing water is required to Marking and Bills 1979, p. 209–210; Kat 2000, p. 1–72). suspend the several-feet-long 1982, p. 123; Vannote and Minshall Interstitial spaces (pores) in coarse superconglutinate of the shinyrayed 1982, p. 4105–4106; Aldridge et al. stream substrates may become clogged pocketbook in the water column so that 1987, p. 18; Waters 1995, p. 173–176; when fine sediment input to streams is the glochidia packet at the end of it, Brim Box 1999, p. 65). excessive (Gordon et al. 1992, p. 1–444). which resembles a small fish, is visible In addition to the direct effects above, Reduced pore space and pore flow rates to fish (O’Brien and Brim Box 1999, p. channel instability indirectly affects reduce habitat for juvenile mussels, 135, 138). mussels and their fish hosts in several which tend to burrow entirely beneath Quantifying the amount of flowing ways. Channels becoming wider and the substrate surface, and for some adult water that is essential to the shallower via bank erosion develop mussels as well (Brim Box and Mossa conservation of the seven mussels is more extreme daily and seasonal 1999, p. 99–117). At least some species complicated by the broad size range of temperature regimes, which affects DO of juvenile unionids feed primarily on streams they inhabit, from small levels and many other temperature- particles associated with sediments and tributaries near watershed headwaters to regulated physical and biological pore water during their early the Apalachicola River, which is the processes. Mussels in wider and development (Yeager et al. 1994, p. world’s 82nd-largest river by discharge shallower channels are likely more 221). Fine sediments act as vectors in (Leopold 1994, p. 101). These seven susceptible to predation. Erosive delivering contaminants such as mussels are often found near the toe of channels lose the habitat complexity nutrients, heavy metals, and pesticides stable stream banks associated with provided by mature bankside to streams (Salomons et al. 1987, p. 13). roots and other instream cover or vegetation, which reduces diversity and Most toxicity data for freshwater structure. A flow sufficient to inundate abundance of fish species. Fewer fish mussels is from tests with water-only the stream bed from bank toe to bank toe means lower probability of mussel exposures, despite reports that with adequately oxygenated water deep recruitment (see ‘‘Fish Hosts’’). The contaminated sediments have enough to deter terrestrial predators is many direct and indirect adverse effects contributed to mussel declines (Newton several orders of magnitude greater at a of channel instability on mussels and 2003, p. 2543; Wilson et al. 1995, p. site on the lower Apalachicola River their fish hosts strongly suggest that 213–218). compared to a site on a tributary stream channel stability is a habitat feature Because the juveniles and adults of in the upper Ochlockonee River. essential to their conservation. the seven mussels live in relatively Quantifying the amount of flowing coarse and not predominantly fine- water that is essential to the Substrate Quality grained substrates, and the introduction conservation of the seven mussels is Adult unionid mussels are generally of fine-grained sediments and various also complicated by their dependency found in localized patches (beds) almost pollutants is likely detrimental to one or on various species of fishes to serve as completely burrowed in the substrate more of their life stages, we have hosts for their glochidia. Mussel with only the area around their siphons determined that substrate quality is a population viability is likely dependent exposed (Balfour and Smock 1995, p. habitat feature essential to their on features of the flow regime that 255–268). The composition and conservation. influence fish host population density abundance of adult mussels have been as well as features that directly affect Flow Regime linked to bed sediment distributions adult and juvenile mussel survival. For (Neves and Widlak 1987, p. 5; Leff et al. The species that are the subject of this example, the largemouth bass, which is 1990, p. 415). Substrate texture (particle proposed rule are all riverine unionid a lab-verified host for the fat threeridge size distribution) affects the ability of mussels and are not found in natural or and shinyrayed pocketbook (O’Brien mussels to burrow in the substrate and manmade ponds and lakes. One known and Brim Box 1999, p. 136; O’Brien and anchor themselves against stream exception is a single large (and Williams 2002, p. 150), is known to currents (Lewis and Riebel 1984, p. presumably old) purple bankclimber utilize seasonally inundated floodplain 2025). Texture and other aspects of found in Goat Rock Reservoir on the habitats for spawning and rearing substrate composition, including bulk Chattahoochee River by malacologist C. (Kilgore and Baker 1996, p. 291–294), density (ratio of mass to volume), Stringfellow (Columbus State habitats which do not support adult or porosity (ratio of void space to volume), University) in 2000 (pers. comm. 2000). juvenile mussels because they are dry and sediment sorting may also influence Otherwise, none of the seven mussels for several months of most years. Year mussel densities (Brim Box 1999, p. 1– tolerate impounded conditions or class strength of largemouth bass has 86; Brim Box and Mossa 1999, p. 99– persist in intermittent streams (Brim been positively correlated with flows in 117). Although several studies have Box and Williams 2000, p. 1–141); several river systems due to the reported adult habitat selection by therefore, continuously flowing water is additional habitat available in high-flow substrate composition, most species are a habitat feature associated with all years (Raibley et al. 1997, p. 852–853), found in a relatively broad range of potentially viable populations. Flowing and fish host density is a factor in substrate types (Tevesz and McCall water transports food items to the mussel recruitment (see ‘‘Fish Hosts’’ 1979, p. 114; Strayer 1981, p. 411; Hove sedentary juvenile and adult life stages discussion below). Year class strength is and Neves 1994, p. 36; Strayer and and provides oxygen for mussel abundance of a cohort (born in a Ralley 1993, p. 255), with few respiration at depths that would be particular year) relative to other cohorts. exceptions (Stansbery 1966, p. 29–30). anoxic in a pond setting. At least three A strong year class is represented in The seven mussels for which we are of the seven mussels are known to much greater numbers than a weak year proposing critical habitat in this attract host fishes visually by apparently class, presumably because the strong

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year class experienced more favorable tolerate the full range of these temperatures (Roberts and Barnhart conditions for recruitment. parameters to persist in that stream. 1999, p. 484). Riverine ecologists have recognized Quantifying water quality tolerances for Various contaminants in point- and that variable flow creates variable the seven mussels is further non-point-source discharges can physical and chemical conditions that complicated by the dependency of degrade water and substrate quality and limit the distribution and abundance of mussels on fish hosts, which may adversely affect mussel populations riverine species (Power et al. 1995, p. exhibit different tolerances. (Horne and McIntosh 1979, p. 119–133; 166; Resh et al. 1988, p. 443). Altering Most mussels are considered sensitive Neves and Zale 1982, p. 53; McCann natural long-term patterns of flow to low DO levels and high temperatures and Neves 1992, p. 77–81; Havlik and changes the structure, composition, and (Fuller 1974, p. 245). Johnson (2001, p. Marking 1987, p. 1–20). Naimo (1995, p. function of riverine communities (Bain 8–11) monitored water quality and 341) suggested that chronic, low-level et al. 1988, p. 382–392; Hill et al. 1991, mussel mortality during a drought year contamination of streams may explain p. 198–210; Sparks 1995, p. 172–173; in the lower Flint River Basin. Low DO the widespread decreases in mussel Scheidegger and Bain 1995, p. 134). Poff levels, which occurred during low flow density and diversity. Mussels appear to et al. (1997, p. 770) and Richter et al. periods, were associated with high be among the organisms most sensitive (1997b, p. 243) concluded that the weekly mussel mortality. Species- to heavy metals (Keller and Zam 1991, accumulated research on the specific mortality varied considerably. p. 539), several of which are lethal at relationship between hydrologic The shinyrayed pocketbook and Gulf relatively low levels (Havlik and variability and riverine ecological moccasinshell were among the species Marking 1987, p. 3). Cadmium appears integrity overwhelmingly supported a with the highest mortality rates when to be the most toxic (Havlik and ‘‘natural flow paradigm,’’ that is, the exposed to DO concentrations less than Marking 1987, p. 3), although copper, patterns of variability in a river’s natural 5 milligrams per liter (mg/L). The oval mercury, chromium, and zinc may also flow regime are critical in sustaining its pigtoe demonstrated moderate, but impair physiological processes ecological integrity. Richter et al. (1996, significantly higher than average, (Jacobson et al. 1993, p. 879; Naimo p. 1165, 1997b, p. 236) proposed a set mortality when DO was less than 5 mg/ 1995, p. 353–355; Keller and Zam 1991, of parameters collectively termed L. p. 539–546; Keller and Lydy 1997, p. 3). ‘‘indicators of hydrologic alteration’’ Juvenile mussels may spend their first Metals stored in mussel tissues indicate (IHA) for characterizing ecologically few years buried in the sediments of the recent or current exposure (Havlik and relevant features of a flow regime. stream bed. Interstitial water (pore Marking 1987, p. 12), while The Service and USEPA adapted a water) in sediments is generally less concentrations in shell material indicate subset of the IHA parameters as oxygenated than flowing water in the past exposure (Imlay 1982, p. 7; Mutvei instream flow guidelines for protecting stream above (Sparks and Strayer 1998, et al. 1994, p. 163–186). Highly acidic riverine ecosystems under a possible p. 129). Sparks and Strayer (1998, p. pollutants such as metals may interstate water allocation formula 132) observed marked differences in contribute to mussel mortality by between Alabama, Florida, and Georgia behavior between juvenile Eastern dissolving shells (Stansbery 1995, p. 2– for the ACF Basin (USFWS and USEPA elliptio (Elliptio complanata), congener 3). Low levels of some metals may 1999, p. 1). Although the three States of the Chipola slabshell, that were inhibit glochidial attachment (Huebner failed to agree upon an allocation exposed to DO levels of 2 mg/L and 4 and Pynno¨nen 1992, p. 2349). Mussel formula and the ACF Compact mg/L, and most juveniles of this species recruitment may be reduced in habitats authorizing their negotiations expired, that were exposed to 1.3 mg/L for a with low but chronic heavy metal and the Service has applied the instream week died. In general, juveniles are other toxicant inputs (Yeager et al. 1994, flow guidelines in consultations with sensitive to low DO levels. Interstitial p. 221; Naimo 1995, p. 341; Ahlstedt Federal agencies on actions affecting the DO levels in streams of the eastern and Tuberville 1997, p. 72–77). species addressed in this proposed rule. United States are usually less than 4 Water pollutants associated with The Service–USEPA guidelines are mg/L in the summer and may fall below agricultural activity may adversely definitions of measures of flow 1 mg/L (Sparks and Strayer 1998, p. affect mussels. Arsenic trioxide, which magnitude, duration, frequency, and 132). is used in the poultry industry as a feed seasonality that may serve as thresholds Water temperature affects the amount additive, is lethal to adult mussels at for ‘‘may affect’’ determinations for of oxygen that can be dissolved in water concentrations of 16.0 parts per million proposed Federal actions that would and the toxicity of various pollutants. (ppm), and ammonia is lethal at alter a flow regime (for example, water The toxic effects of ammonia are more concentrations of 5.0 ppm (Havlik and withdrawals and dam operations). The pronounced at higher temperatures and Marking 1987, p. 3, 13). Ammonia is thresholds are computed from long-term at higher pH (Mummert et al. 2003, p. associated with animal feedlots, flow records appropriate to the 2545, 2550; Newton 2003, p. 2543). nitrogenous fertilizers, and the effluents proposed action, such as daily flow High temperatures or decreasing pH of older municipal wastewater treatment records from a stream gage in the action may increase the toxicity of metals to plants. Ammonia causes a shift in area. The Service–USEPA guidelines are unionids (Havlik and Marking 1987, p. glucose metabolism (Chetty and Indira designed as a tool for site-specific 14). Watters and O’Dee (2000, p. 136) 1995, p. 84) and alters the utilization of analyses and such efforts as this suggested that the release of glochidia is lipids, phospholipids, and cholesterol proposed rule. regulated by water temperature. In (Chetty and Indira 1994, p. 693). Stream Texas, exceptionally warm temperatures ecosystems are altered when nutrients Water Quality appeared to prompt early initiation of are added at concentrations that cannot The ranges of several standard mussel reproductive activity, and cool be assimilated (Stansbery 1995, p. 2–3). physical and chemical water quality temperatures appeared to delay activity Excessive nutrients promote the growth parameters (such as temperature, DO, (Howells 2000, p. 40). Temperature may of filamentous algae in streams, which pH, conductivity) that define suitable affect immune system response in fish. may render substrates unsuitable for habitat conditions for the seven mussels Some fish species that reject infections mussels of all life stages and degrade have not been specifically investigated. by mussel glochidia at higher water quality by consuming oxygen As sedentary animals, mussels must temperatures are infected at lower during night-time respiration and

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during decay to levels that mussels under the CWA and the Act (66 FR infestation (Watters and O’Dee 1996, p. cannot tolerate. Several studies have 11202, February 22, 2001). The criteria 387). Glochidia that contact a host with described adverse effects of pesticides for some pollutants, such as ammonia, natural immunity are rejected and die, on mussels (Fuller 1974, p. 215–257; are presently under review. Although usually within 11 days (Neves et al. Havlik and Marking 1987, p. 13; the State standards adopted consistent 1985, p. 15, 17; Yeager and Neves 1986, Moulton et al. 1996, p. 131). Commonly with the USEPA criteria generally p. 338; Waller and Mitchell 1989, p. 86). used pesticides were cited as the likely represent levels that are safe for the In the case of acquired immunity, cause of a mussel die-off in a North seven mussels, these standards are glochidia experience decreased Carolina stream (Fleming et al. 1995, p. sometimes violated in some streams transformation rates with subsequent 877–879). within their current range. Rather than infections of an initially suitable host Gourdreau et al. (1993, p. 211–230) specify the ranges of dozens of water fish (Arey 1932, p. 372; Bauer and Vogel examined mussel populations relative to quality parameters for the seven 1987, p. 393; Luo 1993, p. 26). The the discharges of two municipal mussels, it is more practical to deal with number of exposures associated with wastewater treatment plants on the cases where the national criteria are not glochidial sloughing is variable (Watters Clinch River in Tazewell County, protective of these and other listed and O’Dee 1996, p. 385, 387). Virginia. Mussels were absent or present species under the national consultations As few as 1 to as many as 25 fish in low numbers immediately with USEPA. For purposes of this species are known to serve as suitable downstream of these discharges, but proposed rule, the evidence for the hosts for particular species of mussels occurred in greater diversity and dependency of the seven mussels on (Fuller 1974, p. 238; Trdan and Hoeh abundance immediately upstream and good water quality supports identifying 1982, p. 386; Gordon and Layzer 1989, farther downstream. The investigators water quality generally as a habitat p. 1–98; Hoggarth 1992, p. 3). Some hypothesized that, in addition to feature that is essential to their mussels are host-fish specialists that chemicals of known toxicity to conservation. parasitize a few fish species (Zale and glochidia, the bacteria and protozoans Neves 1982, p. 2540; Yeager and Saylor associated with wastewater discharges Fish Hosts 1995, p. 4; Neves et al. 1985, p. 13, 17), may also adversely affect mussel Most unionid mussels, including the and others are generalists that parasitize reproduction. Glochidia are vulnerable seven species, parasitize fish during the a great variety of host fishes (Trdan and to attack by bacteria and protozoans larval life stage (see ‘‘Background’’), Hoeh 1982, p. 386). Generally, mussels before and after they are released from depending on fish hosts not only for the that are known host-fish specialists tend the adult female mussel (Fuller 1974, p. physiological transformation from larval to release glochidia in conglutinates 219; Goudreau et al. 1993, p. 221). to juvenile form (Isom and Hudson (multiple glochidia in a packet versus a Adults of some mussel species may 1982, p. 147–151), but also for spatial stream of single glochidia) or use tolerate short-term exposure to various dispersal (Neves 1993, p. 4). The various means of attracting a fish host contaminants by closing their valves distribution and diversity of unionids is before releasing multiple glochidia (Keller 1993, p. 701). Juveniles and strongly related to the distribution and (Watters 1997, p. 45). Because fish that glochidia appear more sensitive than diversity of fish species (Watters 1992, are not naturally immune to glochidial adults to heavy metals (McCann and p. 488; Haag and Warren 1998, p. 298). infection develop some immunity after Neves, 1992, p. 77–81) and to ammonia Bogan (1993, p. 600) identified the infection, securing a host fish is to some (Goudreau et al. 1993, p. 224). dependency of mussels on fish hosts, degree a ‘‘first come, first served’’ Ammonia is lethal to juveniles at which are affected by exploitation and situation. Some researchers have concentrations as low as 0.7 ppm total a variety of common habitat alterations, hypothesized that mussels may compete ammonia nitrogen, normalized to pH 8, as one of several contributing causes in for fish hosts (Watters 1997, p. 57; and lethal to glochidia at concentrations the extinction of several unionid species Trdan and Hoeh 1982, p. 384–385). as low as 2.4 ppm (Augspurger et al. worldwide. Haag and Warren (1998, p. Watters (1997, p. 45–62) developed 2003, p. 2569–2575). In streams, 303) identified host fish availability and individual-based models of mussel— ammonia may occur at highest density as significant factors influencing fish interactions to simulate unionid concentrations in substrate interstitial where certain mussel populations can reproductive strategies, showing spaces where juvenile mussels live and persist. specialists tended to have lower feed (Whiteman et al 1996, p. 794; Although female mussels may population sizes and were less sensitive Hickey and Martin 1999, p. 38; produce 75,000 to 3.5 million glochidia to fluctuating host fish density than Augspurger et al. 2003, p. 2569–2575). (Surber 1912, p. 3–10; Coker et al. 1921, generalists, which attained much higher In general, we believe the numeric p. 144; Yeager and Neves 1986, p. 333), population sizes when host fish density standards for pollutants and water contact of the glochidia with a suitable was high and declined when host quality parameters (for example, heavy host fish is a low-probability event fishdensity declined. metals and DO) that are adopted by the (Neves et al. 1997, p. 60). Contact is Haag and Warren (1998, p. 297–306) States under the Federal Clean Water dependent on many factors, including examined patterns of fish and mussel Act (CWA) represent levels that are the timely presence of the host fish, the community composition in two north essential to the conservation of the feeding and respiratory behaviors of the Alabama drainages. They found that seven mussels. However, some State fish (Dartnall and Walkey 1979, p. 36; densities of host-generalist mussels and standards may not adequately protect Neves et al. 1985, p. 17–18), and for of host-specialist mussels with elaborate mussels, such as the standard for some species, the behavior of the mussel host-attracting mechanisms were ammonia (Augspurger et al. 2003, p. when the fish is present (Davenport and independent of host-fish densities, and 2571; Newton et al. 2003, p. 2559). Warmuth 1965, p. R77; Kraemer 1970, were present throughout the two USEPA and FWS and National Marine p. 225–282). Contact between glochidia drainages. Densities of host-specialist Fisheries Service (the Services) agreed and host fish does not ensure successful mussels without elaborate host- to a national consultation on the CWA larval development to the juvenile form, attracting mechanisms were positively Section 304(a) aquatic life criteria as because some fish species have natural correlated with host-fish densities and part of a Memorandum of Agreement immunity to glochidial infestation and were absent or rare near the drainages’ regarding interagency coordination others acquire immunity following headwaters.

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Host-fish specificity has been eastern mosquitofish. They considered (1) A geomorphically stable stream examined in laboratory tests for five of only the sailfin shiner as a primary host, channel (a channel that maintains its the seven mussels: the fat threeridge, as it was the only species upon which lateral dimensions, longitudinal profile, Gulf moccasinshell, oval pigtoe, purple the transformation rate exceeded 50 and spatial pattern over time without an bankclimber (O’Brien and Williams percent. aggrading or degrading bed elevation); 2002, p. 151), and shiny-rayed We are aware of no studies of the (2) A predominantly sand, gravel, pocketbook (O’Brien and Brim Box reproductive biology of the Chipola and/or cobble stream substrate; 1999, 136). The fat threeridge lacks slabshell. It is likely that the species (3) Permanently flowing water; mantle modifications or other expels glochidia in a conglutinate, as do (4) Water quality (including morphological specializations that several other members of the genus temperature, turbidity, dissolved would serve to attract host fishes and Elliptio that occur in the ACF Basin oxygen, and chemical constituents) that appears to be a host-fish generalist that (Brim Box and Williams 2000, p. 34– meets or exceeds the current aquatic life may infect fishes of at least three 47). Keller and Ruessler (1997, p. 402– criteria established under the Clean different fish families. Glochidia 407) identified centrarchids (sunfishes) Water Act (33 U.S.C. 1251–1387); and transformed to juveniles under as host fishes of other southeastern (5) Fish hosts (such as largemouth laboratory conditions on five of seven Elliptio. bass, sailfin shiner, brown darter) that fish species tested: Weed shiner O’Brien and Williams (2002, p. 153) support the larval life stages of the (Notropis texanus), bluegill (Lepomis observed in the laboratory that purple seven mussels. macrochirus), redear sunfish (L. bankclimber conglutinates readily Criteria Used To Identify Critical microlophus), largemouth bass disintegrated when they contained Habitat (Micropterus salmoides), and mature glochidia, and these were easily blackbanded darter (Percina suspended in the water by the aerators We are proposing to designate as nigrofasciata) (O’Brien and Williams in their holding tanks. They speculated critical habitat areas that were occupied 2002, p. 152). that the species may rely on stream at the time of listing by one or more of The elaborate superconglutinate of the currents to carry glochidia to host fish, the seven mussels and that contain one shiny-rayed pocketbook (see which is typical of host-fish generalist or more of the PCEs to support life ‘‘Background’’) suggests it is a host-fish species. Of the 14 fish species they history functions essential to the specialist that targets sight-feeding tested as potential hosts, only a few conservation of the species. This section piscivorous fishes, such as bass. O’Brien species transformed glochidia, describes how we identified those and Brim Box (1999, p. 136) confirmed including the eastern mosquitofish and streams and delineated the upstream that largemouth bass and spotted bass blackbanded darter. Only the mosquito and downstream boundaries of 11 (Micropterus punctulatus) are likely fish was 100 percent effective (all fish proposed critical habitat units. primary hosts (all fishes infected tested transformed glochidia), but it is We began our analysis by examining produced juvenile mussels) among 11 an unlikely primary host fish. The the full extent of each species’ historical species tested. Low transformation rates mosquito fish occupies backwater areas and current range. As discussed under were associated with fish such as the and stream margins with little or no ‘‘Summary of Threats to Surviving eastern mosquitofish (Gambusia current (Lee et al. 1980, p. 1–854), while Populations’’ above, the declining range holbrooki) and bluegill. the bankclimber is found mostly in the and abundance of the seven mussels is The Gulf moccasinshell is probably a main channels of larger streams and due mostly to changes in their riverine host-fish specialist that primarily rivers. The primary host fishes of the habitats resulting from dams, dredging, parasitizes darters. It visually lures host purple bankclimber are still unknown. mining, channelization, pollution, fish by undulating its dark mantle flaps Data that might suggest densities of sedimentation, and water withdrawals. against swollen white gills (O’Brien and the various primary host fish species The Econfina, ACF, Ochlockonee, and Williams 2002, p. 154). O’Brien and named above that are sufficient to Suwannee drainages contain about Williams (2002, p. 152) lab-tested eight support normal mussel recruitment and 54,000 km (33,500 mi) of perennial fish species for suitability as hosts, dispersal rates are not available. streams (USGS 1:100,000 National finding that all black-banded darters Stochastic simulations of fish’mussel Hydrography Data). From mussel survey and brown darters (Etheostoma edwini) interactions indicate that mussel records, the historical range of the seven exposed to infection transformed populations are extirpated if a threshold mussels collectively spanned about glochidia to juveniles. Other fishes, host fish density is not exceeded 3,300 km (2,050 mi), or 6 percent, of the including the eastern mosquitofish, also (Watters 1997, p. 60). Further studies of river and stream channels in these transformed glochidia, but at lower fish and mussel population dynamics drainages, but no one species accounts percentage rates. are necessary to quantify species- for more than about 2,300 km (1,445 mi) The extreme rarity of the Ochlockonee specific thresholds; however, we of that total (USFWS 2003, p. 78–80). moccasinshell has precluded any recognize that the presence of host fish We estimate that the five species listed opportunities to explore its life history. is a biological habitat feature essential to as endangered are each extirpated from We assume its reproductive biology is the conservation of the seven mussels. over half of their historical range, and similar to its congener, the Gulf the two threatened species are moccasinshell, which uses darters as Primary Constituent Elements for Five extirpated from about one-third of host fish. Endangered and Two Threatened theirs, but none are extirpated entirely The oval pigtoe releases rigid white to Mussels from the four major drainages in which pinkish conglutinates, which passively Based on our current knowledge of they each occurred historically. All drift in the current and may resemble the life history, biology, and ecology of seven mussels were more widespread the food organisms of small-bodied the seven mussels, and of the habitat and more abundant within each of the fishes. O’Brien and Williams (2002, p. features necessary to support their four drainages historically. 152) tested 11 fish species as hosts, essential life history functions in areas The largest single portion of the finding that glochidia transformed on occupied at the time of listing, historical range lost to the seven the gills of fish such as the sailfin shiner summarized above, we have determined mussels is the mainstem of the (Pteronotropis hypselopterus) and that the PCEs are: Chattahoochee River. The

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Chattahoochee comprised over 700 km systems. Processes that occur and several days unless they reach (435 mi), or almost one-quarter, of the habitat characteristics that are found unsuitable habitat conditions, such as 3,300-km (2,050-mi) collective historical outside the stream banks are important intolerable salinity or still water, in range, and supported the shinyrayed in maintaining channel morphology, which either would sink to the bottom pocketbook, Gulf moccasinshell, oval providing energy and nutrients, and and be smothered in the sediments. pigtoe, and purple bankclimber. It is protecting the instream environment Therefore, we are proposing stream now impounded by several major dams from pollutants and excessive segments that have mussel point for much of its length and no longer sediments. Similarly, floodplain and locations from the upstream limit as supports the listed mussels. With the backwater habitats may be important in defined in (b) above to the downstream exception of a single live animal found the life cycle of fish that serve as hosts location where the PCEs are no longer in Goat Rock Reservoir in 2000, the for mussel larvae. Although factors present. purple bankclimber appears extirpated affecting the PCEs may occur outside The application of these criteria from the entire Chattahoochee Basin, the channel, the PCEs themselves occur resulted in the identification of 11 units but at least one of the other three within the channel. occupied by one or more of the seven species persist in three of its tributaries: (b) The upstream boundary of a unit mussels and that contain one or more of Uchee Creek, Sawhatchee Creek, and in an occupied stream is the first the PCEs as indicated by the presence Kirkland Creek. Elsewhere in the four perennial tributary confluence or first and persistence of one or more of the major drainages, the pattern of permanent barrier to fish passage (such listed mussels (see ‘‘Proposed Critical extirpation is more variable, with one or as a dam) upstream of the upstream- Habitat Designation’’). Based on fish more of the seven species persisting in most current occurrence record. Many distributional records (Lee et al. 1980, p. portions of a drainage where others have of the mussel survey sites are located 1–854) and our experience sampling disappeared. The collective range of the near watershed headwaters. In these fish in these drainages, these areas also seven species now spans about 1,900 areas, the confluence of a tributary support shiners, darters, and other km (1,180 mi) of river and stream typically marks a significant change in fishes that have been identified as hosts channels. Within this collective range, the size of the stream and is a logical or potential hosts for one or more of the the species presently occur in as little as and recognizable upstream boundary for seven mussels. Further, on the basis of 55 km (34 mi) (the Ochlockonee habitat conditions that are similar to the a review of the information available, moccasinshell) to as much as 785 km upstream-most occurrence record. we have determined that areas not (488 mi) (the shinyrayed pocketbook) Likewise, a dam or other barrier to fish currently known to be occupied by the (USFWS 2003, p. 78–80). passage marks the upstream extent to seven mussels do not appear to be To identify the specific areas that which mussels at the upstream-most essential to their conservation. As such, were occupied at the time of listing by occurrence may disperse via their fish we have not included any areas not each of the seven mussels and that hosts. Therefore, proposed segments known to be occupied by these mussel contain one or more of the PCEs, we encapsulate habitat containing essential species in this proposed designation. used post-1990 mussel survey results. features used by host fish and the seven When determining the boundaries of Because mussels are sedentary and long- mussels for successful natural proposed critical habitat for the seven lived animals, occupancy is strong reproductive process. Habitat above mussels, we made every effort to avoid evidence that some or all of the PCEs are these boundaries does not contain manmade structures existing on the present, except where it is apparent that features essential to the conservation of effective date of this rule and not one or a few adult individuals remain at the species. containing one or more of the primary a location with little or no possibility of (c) The downstream boundary of a constituent elements, such as buildings reproducing due to substantial habitat unit in an occupied stream is the mouth and roads. Any such structures alteration (such as the single purple of the stream, the upstream extent of inadvertently left inside the critical bankclimber found in Goat Rock tidal influence, or the upstream extent habitat boundaries have been excluded Reservoir). It is not feasible to survey all of an impoundment, whichever comes by the text in this proposed rule and are potential habitat for the seven species; first, downstream of the downstream- not proposed for designation. most occurrence record. Many survey therefore, to delineate a species’ Special Management Considerations or sites are located near the mouths of occupied range in the larger stream Protection network, it is necessary to extrapolate streams, the upstream extent of from the available survey data. Most of impoundments, or the upstream extent When designating critical habitat, we the tributary streams in the four basins of tidal influence. Survey locations are assess whether the areas determined to that may support one or more of the typically at road crossings, because that be occupied at the time of listing and seven species have never been surveyed, is where surveyors can most easily gain containing the PCEs may require special and we do not propose any unsurveyed access to the stream. These road management considerations or streams as critical habitat. We used crossings do not typically represent a protections. Activities in or adjacent to USGS 1:100,000 digital stream maps to meaningful ecological boundary for each of the critical habitat units delineate the probable upstream and longitudinal stream habitat conditions. described in this proposed rule may downstream limits to the seven species’ Mussels are dispersed via host fish, and affect one or more of the PCEs that are distribution in streams surveyed since because these host fish traverse freely in found in the unit. These activities 1990, according to the criteria listed the area between the upstream most include, but are not limited to, those below. These limits form the boundaries occurrence and any existing listed in the Adverse Modification of proposed critical habitat units as downstream restriction to fish passage, Standard section as activities that may explained below. larvae drop off their host fish at random destroy or adversely modify critical (a) The lateral boundaries of a unit are points along the stream flow segments habitat. We find that the features the ordinary high-water marks on each traversed by fish. Further, the sperm of essential to each of the seven mussel bank of currently occupied streams. We all seven species and the conglutinates species contained within the areas recognize the dynamic nature of riverine (glochidia packets) of some of the seven proposed for designation may require systems and that floodplains and may be carried downstream by currents special management considerations or riparian areas are integral parts of those and are viable for several hours to protections due to known or probable

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threats from these activities. We and dam construction (unit 5) may also Proposed Critical Habitat Designation summarize here the nature of the threats affect channel stability. and the resulting conservation needs for The construction and operation of We are proposing 11 groups of river both the mussels and their host fish dams, water withdrawals, and water and stream segments (units) as critical across the range of the seven mussels. diversions may alter features of the flow habitat for the seven mussels. The river Sedimentation is an almost regime important to the mussels and and stream segments comprising each ubiquitous threat in the range of the their host fishes. This threat is present unit are contiguous to allow for the seven mussels. A wide variety of to some degree in all 11 proposed units, movement of fish hosts dispersing the activities, such as livestock grazing, but is greatest in units 5, 6, 7, 8, and 10, larval life stages of the seven mussels road and bridge construction, clear-cut which are downstream of the major within the unit. Barriers to the logging, and off-road vehicle use, that mainstem dams or in areas of relatively movement of fish hosts (dams and salt are common in all 11 units may increase high municipal, industrial, or water) separate the units from each erosion rates, either in the banks of the agricultural water use. Measures to deal other. The critical habitat units with this threat include water stream channel itself or elsewhere in the described below constitute our best conservation and operational strategies watershed, and cause the accumulation assessment at this time of areas that that manage water storage capacity and of fine sediments on the stream bed. were occupied by one or more of the water demands in combination to Management considerations to deal with seven mussels at the time of listing minimize departures from the natural this threat include protecting streams flow regime. (1998) and which contain the physical from sedimentation through application Water pollution, especially from non- and biological features essential to the of agricultural and forestry best point (dispersed release) sources, is each of the mussel species. Each unit is management practices, avoiding soil- another almost ubiquitous threat in all designated only for those species that and vegetation-disturbing activity in the 11 units. Water quality is reported as currently occupy it. Each unit contains riparian zone, restoring unstable stream impaired or potentially impaired in one or more of the PCEs, and may channels and other erosive areas, and some portions of all four river basins require special management other practices that prevent or reduce within the current range of the seven considerations or protection to address erosion. mussels, according to the water quality the threats noted above. The 11 units, Urbanization, road and bridge agencies of the three States in their and the States in which they occur, are: construction, and other large-scale periodic assessments under Section (1) Econfina Creek (FL), (2) Chipola alterations of land cover that 305(b) of the Clean Water Act (CWA) River (AL, FL), (3) Uchee Creek (AL), (4) substantially alter the runoff (see ‘‘Summary of Threats to Surviving Sawhatchee Creek and Kirkland Creek characteristics of the watershed may Populations’’). Streams that receive a (GA), (5) Upper Flint River (GA), (6) threaten channel stability in units near high proportion of their flow from the Middle Flint River (GA), (7) Lower Flint the major urban areas of Dothan, discharge of springs are vulnerable to River (GA), (8) Apalachicola River (FL), Alabama (unit 2); Panama City and nutrient enrichment from fertilizers and (9) Upper Ochlockonee River (FL, GA), Tallahassee, Florida (units 1 and 10); to other pollutants applied in the (10) Lower Ochlockonee River (FL), and Albany, Atlanta, and Columbus, Georgia recharge areas of those springs (units 1, (11) Santa Fe River and New River (FL). (units 3, 5, 6, and 7); and other cities. 2, and 7), which may extend far from Management considerations to deal with the streams themselves. Management Collectively, the total length of the river the threat of channel instability include considerations to deal with the threat of and stream segments of all of the areas avoiding soil- and vegetation-disturbing pollution include applying agricultural (units) proposed is approximately 1,864 activity in the riparian zone, limiting and forestry best management practices, km (1,158 mi). Table 1 shows the impervious surface area, and other preserving native vegetation in riparian approximate length of rivers and urban storm water runoff control zones, maintaining septic systems, and streams proposed as occupied critical methods. Sand and gravel mining (unit taking other measures to minimize habitat for each of the seven mussels in 3), dredging and channelization (unit 8), pollutant-laden runoff to streams. the 11 units.

Currently occupied Species, critical habitat unit, and state(s) Kilometers Miles

Fat threeridge 2. Chipola River, AL, FL ...... 190.0 118.1 8. Apalachicola River, FL ...... 155.4 96.6

Total ...... 345.4 214.7

Shinyrayed pocketbook 2. Chipola River, AL, FL ...... 190.0 118.1 3. Uchee Creek, AL ...... 34.2 21.2 4. Sawhatchee Creek and Kirkland Creek, GA ...... 37.8 23.5 5. Upper Flint River, GA ...... 380.4 236.4 6. Middle Flint River, GA ...... 302.3 187.8 7. Lower Flint River, GA ...... 396.7 246.5 9. Upper Ochlockonee River, FL, GA ...... 177.3 110.2

Total ...... 1518.7 943.7

Gulf moccasinshell 1. Econfina Creek, FL ...... 31.4 19.5 2. Chipola River, AL, FL ...... 190.0 118.1

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Currently occupied Species, critical habitat unit, and state(s) Kilometers Miles

4. Sawhatchee Creek and Kirkland Creek, GA ...... 37.8 23.5 5. Upper Flint River, GA ...... 380.4 236.4 6. Middle Flint River, GA ...... 302.3 187.8 7. Lower Flint River, GA ...... 396.7 246.5

Total ...... 1338.3 831.8

Ochlockonee moccasinshell 9. Upper Ochlockonee River, FL, GA ...... 177.3 110.2

Total ...... 177.3 110.2

Oval pigtoe 1. Econfina Creek, FL ...... 31.4 19.5 2. Chipola River, AL, FL ...... 190.0 118.1 4. Sawhatchee Creek and Kirkland Creek, GA ...... 37.8 23.5 5. Upper Flint River, GA ...... 380.4 236.4 6. Middle Flint River, GA ...... 302.3 187.8 7. Lower Flint River, GA ...... 396.7 246.5 9. Upper Ochlockonee River, FL, GA ...... 177.3 110.2 11. Santa Fe and New Rivers, FL ...... 83.1 51.6

Total ...... 1598.7 993.6

Chipola slabshell 2. Chipola River, AL, FL ...... 190.0 118.1

Total ...... 190.0 118.1

Purple bankclimber 5. Upper Flint River, GA ...... 380.4 236.4 6. Middle Flint River, GA ...... 302.3 187.8 7. Lower Flint River, GA ...... 396.7 246.5 8. Apalachicola River, FL ...... 155.4 96.6 9. Upper Ochlockonee River, FL, GA ...... 177.3 110.2 10. Lower Ochlockonee River, FL ...... 75.4 46.9

Total ...... 1487.2 924.4

Total Proposed for All 11 Units (All Species) ...... 1864.0 1158.3

Brief descriptions of each unit follow, Unit 1: Econfina Creek, Florida Unit 2: Chipola River, Alabama and listing the rivers and streams included, Florida the upstream and downstream extent of Unit 1 includes the main stem of the unit in those rivers and streams, and Econfina Creek and one of its tributaries Unit 2 includes the main stem of the which of the seven mussels were in Bay and Washington counties, Chipola River (including the reach present at the time of listing. Each Florida, encompassing a total stream known as Dead Lake) and six of its critical habitat unit includes the length of 31.4 km (19.5 mi). The main tributaries, encompassing a total stream channels of the rivers and streams listed stem of Econfina Creek as proposed length of 190.0 km (118.1 mi) in between the ordinary high water mark extends from its confluence with Deer Houston County, Alabama; and in on each bank, which is defined in 33 Point Lake at the powerline crossing Calhoun, Gulf, and Jackson counties, CFR 329.11 as ‘‘the line on the shore located 3.8 km (2.3 miles) downstream Florida. The main stem of the Chipola established by the fluctuations of water of Bay County Highway 388, Bay River as proposed extends from its and indicated by physical County, Florida, upstream 28.6 km (17.8 confluence with the Apalachicola River characteristics such as a clear, natural mi) to Tenmile Creek in Washington in Gulf County, Florida, upstream 144.9 line impressed on the bank; shelving; County, Florida. Unit 1 also includes km (90.0 mi) to the confluence of changes in the character of soil; the tributary stream Moccasin Creek Marshall and Cowarts creeks in Jackson destruction of terrestrial vegetation; the from its confluence with Econfina Creek County, Florida. A short segment of the presence of litter and debris; or other Chipola River that flows underground upstream 2.8 km (1.7 mi) to Ellis Branch appropriate means that consider the within the boundaries of Florida in Bay County. Unit 1 is designated for characteristics of the surrounding Caverns State Park in Jackson County, areas.’’ In the unit descriptions, the Gulf moccasinshell and oval pigtoe Florida, is not included in Unit 2. The distances between landmarks marking (Blalock-Herod unpub. data 2002–03; downstream extent of each tributary the upstream or downstream extent of a Brim Box unpub. data 1996; Williams within the unit is its mouth (its particular stream in the unit are given unpub. data 1993). confluence with the water body named), in kilometers (km) and equivalent miles and the upstream extent is the landmark (mi), as measured tracing the course of listed. The tributaries of the Chipola the stream, not straight-line distance. River included in Unit 2 are: Dry Creek,

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from the Chipola River upstream 7.6 km is included from its confluence with Unit 5 is designated for the (4.7 mi) to Ditch Branch in Jackson Sawhatchee Creek upstream 3.1 km (1.9 shinyrayed pocketbook (Dinkins pers. County, Florida; Rocky Creek, from the mi) to the powerline crossing located comm. 1999, 2003; P.D. Johnson pers. Chipola River upstream 7.1 km (4.4 mi) 2.3 km (1.4 mi) upstream of Sowhatchee comm. 2003; Brim Box and Williams to Little Rocky Creek in Jackson County, Road, Early County, GA. Unit 4 is 2000, p. 109–110; Roe 2000; L. Andrews Florida; Waddells Mill Creek, from the designated for the shinyrayed pers. comm. 2000; Blalock-Herod Chipola River upstream 3.7 km (2.3 mi) pocketbook, Gulf moccasinshell, and unpub. data 1997; Butler and Brim Box to Russ Mill Creek in Jackson County, oval pigtoe (Brim Box and Williams 1995, p. 3); Gulf moccasinshell Florida; Baker Creek, from Waddells 2000, p. 109–110, 113–114, 116–117; (Edwards Pittman Environmental 2004; Mill Creek upstream 5.3 km (3.3 mi) to Abbott pers. comm. 2005; Stringfellow McCafferty pers. comm. 2003; Dinkins the confluence with Tanner Springs in pers. comm. 2003). pers. comm. 2002; Brim Box and Jackson County, Florida; Marshall Williams 2000, p. 113–114; Andrews Unit 5: Upper Flint River, Georgia Creek, from the Chipola River upstream pers. comm. 2000; Blalock-Herod 13.7 km (8.5 mi) to the Alabama-Florida Unit 5 includes the main stem of the unpub. data 1997; Butler and Brim Box State line in Jackson County, Florida Flint River and eight of its tributaries 1995, p. 3); oval pigtoe (Edwards (this creek is known as Big Creek in upstream of Lake Blackshear, plus two Pittman Environmental 2004; Alabama); and Big Creek, from the tributaries that flow into Lake McCafferty pers. comm. 2003; Dinkins Alabama-Florida State line upstream 7.8 Blackshear, encompassing a total stream pers. comm. 2002, 2003; Stringfellow km (4.9 mi) to Double Bridges Creek in length of 380.4 km (236.4 mi) in Coweta, pers. comm. 2000, 2003; Abbott pers. Houston County, Alabama. Crawford, Crisp, Dooly, Fayette, Macon, comm. 2001; Brim Box and Williams This unit is designated for the fat Meriwether, Peach, Pike, Spalding, 2000, p. 116–117; Andrews pers. comm. threeridge (Brim Box and Williams Sumter, Talbot , Taylor, Upson, and 2000; Blalock-Herod unpub. data 1997); 2000, p. 92–93; Miller 1998, p. 54), Worth counties, Georgia. The main stem and purple bankclimber (Winterringer shinyrayed pocketbook (Williams of the Flint River in proposed Unit 5 CCR pers. comm. 2003; Dinkins pers. unpub. data 2002; Brim Box and extends from the State Highway 27 comm. 2003; P.D. Johnson pers. comm. Williams 2000, p. 109–110; Smith bridge (Vienna Road) in Dooly and 2003; Albanese pers. comm. 2003 unpub. data 2001; Blalock-Herod Sumter counties, Georgia (the river is regarding unpub. data from De unpub. data 2000, 2003; Butler unpub. the county boundary), upstream 247.4 Genachete and CCR; Brim Box and data 1993, 1994, 1999, 2000); Gulf km (153.7 mi) to Horton Creek in Williams 2000, p. 105–106; E. Van De moccasinshell (Butler unpub. data 1999, Fayette and Spalding counties, Georgia Genachete pers. comm. 1999). 2002; Brim Box and Williams 2000, p. (the river is the county boundary). The Unit 5 is divided into two maps in the 113–114; D.N. Shelton pers. comm. downstream extent of each tributary Proposed Regulation Promulgation 1998); oval pigtoe (Butler unpub. data within the unit is its mouth (its section of this proposed rule, one for the 1993, 1999, 2002; Brim Box and confluence with the water body named), southern part and one for the northern Williams 2000, p. 116–117; Williams and the upstream extent is the landmark part of the unit. The ‘‘match line’’ for unpub. data 2000); and Chipola listed. The nine tributary streams in joining these two maps is where the slabshell (Butler unpub. data 1993, Unit 5 are: Swift Creek, from Lake county boundary between Crawford and 2000; Brim Box and Williams 2000, p. Blackshear upstream 11.3 km (7 mi) to Upson counties, Georgia, meets the Flint 95–96). Rattlesnake Branch in Crisp and Worth River. counties, Georgia (the creek is the Unit 3: Uchee Creek, Alabama county boundary); Limestone Creek, Unit 6: Middle Flint River, Georgia Unit 3 encompasses 34.2 km (21.2 mi) from Lake Blackshear in Crisp County, Unit 6 includes the main stem of the of the main stem of Uchee Creek from Georgia, upstream 8.8 km (5.5 mi) to Flint River between Lake Worth its confluence with the Chattahoochee County Road 89 in Dooly County, (impounded by the Flint River Dam near River upstream to Island Creek in Georgia; Turkey Creek, from the Flint Albany) and the Warwick Dam (which Russell County, Alabama. This unit is River upstream 21.7 km (13.5 mi) to impounds Lake Blackshear), and nine designated for the shinyrayed Rogers Branch in Dooly County, tributaries, encompassing a total stream pocketbook (Brim Box and Williams Georgia; Pennahatchee Creek, from length of 302.3 km (187.8 mi) in 2000, p. 109–110; Gangloff unpublished Turkey Creek upstream 4.8 km (3 mi) to Dougherty, Lee, Marion, Schley, Sumter, data 2005). Little Pennahatchee Creek in Dooly Terrell, Webster, and Worth counties, County, Georgia; Little Pennahatchee Georgia. The main stem of the Flint Unit 4: Sawhatchee Creek and Kirkland Creek, from Pennahatchee Creek River in Unit 6 extends from Piney Creek, Georgia upstream 5.8 km (3.6 mi) to Rock Hill Woods Creek in Dougherty County, Unit 4 includes the main stems of Creek in Dooly County, Georgia; Georgia (the approximate upstream Sawhatchee Creek and Kirkland Creek Hogcrawl Creek, from the Flint River extent of Lake Worth), upstream 39.9 and one tributary of Sawhatchee Creek, upstream 21.6 km (13.4 mi) to Little km (24.8 mi) to the Warwick Dam in Lee encompassing a total stream length of Creek in Dooly and Macon counties, and Worth counties, Georgia. The 37.8 km (23.5 mi) in Early County, GA. Georgia (the creek is the county downstream extent of each tributary The main stem of Sawhatchee Creek as boundary); Red Oak Creek, from the within the unit is its mouth (its proposed extends from its confluence Flint River upstream 21.7 km (13.5 mi) confluence with the water body named), with the Chattahoochee River upstream to Brittens Creek in Meriwether County, and the upstream extent is the landmark 28.6 km (17.8 mi) to the powerline Georgia; Line Creek, from the Flint River listed. The nine tributaries of the crossing located 1.4 km (0.87 mi) upstream 15.8 km (9.8 mi) to Middle Flint River in Unit 6 are: upstream of County Road 15, Early Whitewater Creek in Coweta and Kinchafoonee Creek, from the Lee- County, GA. The main stem of Kirkland Fayette counties, Georgia (the creek is Dougherty county line (the approximate Creek extends from its confluence with the county boundary); and Whitewater upstream extent of Lake Worth) the Chattahoochee River upstream 6.1 Creek, from Line Creek upstream 21.5 upstream 107.6 km (66.8 mi) to Dry km (3.8 mi) to Dry Creek, Early County, km (13.4 mi) to Ginger Cake Creek in Creek in Webster County, Georgia; GA. The tributary, Sheffield Mill Creek, Fayette County, Georgia. Lanahassee Creek, from Kinchafoonee

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Creek upstream 9.3 km (5.8 mi) to West (which impounds Lake Worth), and 2001, 2002; Andrews pers. comm. 2000; Fork Lanahassee Creek in Webster nine tributaries, encompassing a total Brim Box and Williams 2000, p. 116– County, Georgia; Muckalee Creek, from stream length of 396.7 km (246.5 mi) in 117; P. Johnson unpub. data 1999; the Lee’Dougherty county line (the Baker, Calhoun, Decatur, Dougherty, Butler unpub. data 1998; Blalock-Herod approximate upstream extent of Lake Early, Miller, Mitchell, and Terrell unpub. data 1997), and purple Worth) upstream 104.5 km (64.9 mi) to counties, GA. The main stem of the bankclimber (S. Carlson unpub. data County Road 114 in Marion County, Flint River in Unit 7 extends from its 2002; Brim Box and Williams 2000, p. Georgia; Little Muckalee Creek, from confluence with Big Slough in Decatur 105–106). Muckalee Creek in Sumter County, County, GA (the approximate upstream Unit 7 is divided into two maps in the Georgia, upstream 7.2 km (4.5 mi) to extent of Lake Seminole) upstream Proposed Regulation Promulgation Galey Creek in Schley County, Georgia; 116.4 km (72.3 mi) to the Flint River section of this proposed rule, one for the Mill Creek, from the Flint River Dam in Dougherty County, GA. The western part and one for the eastern part upstream 3.2 km (2 mi) to Mercer downstream extent of each tributary of the unit. The western part (Map 10) Millpond Creek in Worth County, within the unit is its mouth (its depicts the Spring Creek system and the Georgia; Mercer Millpond Creek, from confluence with the water body named), eastern part (Map 11) depicts the lower Mill Creek upstream 0.45 km (0.28 mi) and the upstream extent is the landmark Flint River system. to Mercer Millpond in Worth County, listed. The nine tributaries of the Lower Unit 8: Apalachicola River, Florida Georgia; Abrams Creek, from the Flint Flint River in Unit 7 are: Spring Creek, River upstream 15.9 km (9.9 mi) to from Smith Landing in Decatur County, Unit 8 includes the main stem of the County Road 123 in Worth County, Georgia (the approximate upstream Apalachicola River and two Georgia; Jones Creek, from the Flint extent of Lake Seminole), upstream 74.2 distributaries (channels flowing out of the main stem), encompassing a total River upstream 3.8 km (2.4 mi) to km (46.1 mi) to County Road 35 in Early stream length of 155.4 km (96.6 mi) in County Road 123 in Worth County, County, Georgia; Aycocks Creek, from Calhoun, Franklin, Gadsden, Gulf, Georgia; and Chokee Creek, from the Spring Creek upstream 15.9 km (9.9 mi) Jackson, and Liberty counties, Florida. Flint River upstream 10.5 km (6.5 mi) to to Cypress Creek in Miller County, The main channel of the Apalachicola Dry Branch Creek in Lee County, Georgia; Dry Creek, from Spring Creek River in Unit 8 extends from the Georgia. upstream 9.9 km (6.1 mi) to Wamble downstream end of Bloody Bluff Island Unit 6 is designated for the Creek in Early County, Georgia; (river mile 15.3 on U.S. Army Corps of shinyrayed pocketbook (Crow CCR pers. Ichawaynochaway Creek, from the Flint Engineers Navigation Charts) in comm. 2004; Edwards Pittman River in Baker County, Georgia, Franklin County, Florida, upstream to Environmental 2004; Albanese pers. upstream 68.6 km (42.6 mi) to Merrett the Jim Woodruff Lock and Dam in comm. 2003 regarding unpub. data from Creek in Calhoun County, Georgia; Mill Gadsden and Jackson counties, Florida CCR; DeGarmo unpub. data 2002; Creek, from Ichawaynochaway Creek (the river is the county boundary). The McCafferty pers. comm. 2000, 2001; upstream 7.4 km (4.6 mi) to County upstream extent of each distributary Golladay unpub. data 2001, 2002; P. Road 163 in Baker County, Georgia; within the unit is its point of departure Johnson unpub. data 1999; Blalock- Pachitla Creek, from Ichawaynochaway from the main channel of the Herod unpub. data 1997; Dinkins pers. Creek upstream 18.9 km (11.8 mi) to Apalachicola River, and the comm. 1995; Brim Box and Williams Little Pachitla Creek in Calhoun County, downstream extent is the landmark 2000, p. 109–110), Gulf moccasinshell Georgia; Little Pachitla Creek, from (Wisnewski unpub. data 2005; DeGarmo listed. The two distributaries of the Pachitla Creek upstream 5.8 km (3.6 mi) unpub. data 2002; Albanese pers. comm. Apalachicola River in Unit 6 are: to Bear Branch in Calhoun County, 2003 regarding unpub. data from D. Chipola Cutoff, from the Apalachicola Georgia; Chickasawhatchee Creek, from Shelton; P. Johnson unpub. data 1999; River in Gulf County, Florida, Ichawaynochaway Creek in Baker Brim Box and Williams 2000, p. 113– downstream 4.5 km (2.8 mi) to its County, GA, upstream 64.5 km (40.1 mi) 114; Weston 1995), oval pigtoe confluence with the Chipola River in to U.S. Highway 82 in Terrell County, (Wisnewski unpub. data 2005; Crow Gulf County, Florida; and Swift Slough, Georgia; and Cooleewahee Creek, from CCR pers. comm. 2004; Albanese pers. from the Apalachicola River in Liberty the Flint River upstream 15.1 km (9.4 comm. 2003 regarding unpub. data from County, Florida, downstream 3.6 km mi) to Piney Woods Branch in Baker CCR; DeGarmo unpub. data 2002; (2.2 mi) to its confluence with the River County, Georgia. Stringfellow unpub. data 2002; Golladay Styx in Liberty County, Florida. unpub. data 2001, 2002; Brim Box and Unit 7 is designated for the Unit 8 is designated for the fat Williams 2000, p. 116–117; P. Johnson shinyrayed pocketbook (Gangloff 2005; threeridge (Brim Box and Williams unpub. data 1999; Blalock-Herod McCafferty pers. comm. 2004; 2000, p. 92–93; Williams unpub. data unpub. data 1997; Weston 1995), and Stringfellow unpub. data 2003; Dinkins 2000; Miller 1998, p. 54, 2000; purple bankclimber (Tarbell 2004; Brim pers. comm. 2001, 2003; Golladay Richardson and Yokley 1996, p. 137; Box and Williams 2000, p. 105–106). unpub. data 2001, 2002; P. Johnson Flakes 2001) and purple bankclimber Unit 6 is divided into two maps in the unpub. data 1999; Albanese pers. comm. (Brim Box and Williams 2000, p. 105– Proposed Regulation Promulgation 2003 regarding unpub. data from CCR; 106; Miller 1998, p. 55, 2000; section of this proposed rule, one for the Andrews pers. comm. 2000; Blalock- Richardson and Yokley 1996, p. 137; western part and one for the eastern part Herod unpub. data 1997; Brim Box and Butler unpub. data 1993; Flakes 2001). of the unit. The ‘‘match line’’ for joining Williams 2000, p. 109–110; Butler Unit 9: Upper Ochlockonee River, these two maps is Lake Worth in unpub. data 1993), Gulf moccasinshell Florida, Georgia Dougherty County, Georgia. (Abbott pers. comm. 2005; Golladay unpub. data 2001, 2002; P. Johnson Unit 9 includes the main stem of the Unit 7: Lower Flint River, Georgia unpub. data 1999; Brim Box and Ochlockonee River upstream of Lake Unit 7 includes the main stem of the Williams 2000, p. 113–114; Butler Talquin (impounded by the Jackson Flint River between Lake Seminole unpub. data 1998; Blalock-Herod Bluff Dam) and three tributaries, (impounded by the Jim Woodruff Lock unpub. data 1997), oval pigtoe (Dinkins encompassing a total stream length of and Dam) and the Flint River Dam pers. comm. 2001; Golladay unpub. data 177.3 km (110.2 mi) in Gadsden and

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Leon counties, Florida, and Grady and Smith FDOT unpub. data 2001; (Blalock-Herod and Williams 2001, p. 5; Thomas counties, Georgia. The main Williams unpub. data 1993). Blalock-Herod 2000, p. 1–72; Williams stem of the Ochlockonee River in Unit unpub. data 1993, 1996–98). Unit 10: Lower Ochlockonee River, 9 extends from its confluence with Florida Existing Critical Habitat Gulley Branch (the approximate upstream extent of Lake Talquin) in Unit 10 encompasses 75.4 km (46.9 Of the proposed critical habitat for the Gadsden and Leon counties, Florida (the mi) of the main stem of the Ochlockonee seven mussels, 147.3 km (91.5 mi) are river is the county boundary), upstream River from its confluence with Syfrett already designated critical habitat for to Bee Line Road/County Road 306 in Creek in Wakulla County, Florida, the Gulf sturgeon (Acipenser oxyrinchus Thomas County, Georgia. The upstream to the Jackson Bluff Dam desotoi) (68 FR 13370; March 19, 2003), downstream extent of each tributary (which impounds Lake Talquin) in Leon which was listed as a threatened species within the unit is its mouth (its and Liberty counties, Florida. Unit 10 is under the Act on September 30, 1991 confluence with the water body named), designated for the purple bankclimber (56 FR 49653). The area in common and the upstream extent is the landmark (Blalock-Herod unpub. data 2003; between the proposed mussels’ habitat listed. The three tributary streams in Williams unpub. data 1993). and the designated sturgeon habitat is entirely within Unit 8, the Apalachicola Unit 9 are: Barnetts Creek, from the Unit 11: Santa Fe River and New River, River. Ochlockonee River upstream 20 km Florida (12.4 mi) to Grady County Road 170/ Unit 11 includes the main stem of the Land Ownership Thomas County Road 74 in Grady and Santa Fe River and its tributary the New States were granted ownership of Thomas counties, Georgia (the creek is River, encompassing a total stream lands beneath navigable waters up to the county boundary); West Barnetts length of 83.1 km (51.6 mi) in Alachua, the ordinary high water mark upon Creek, from Barnetts Creek upstream 10 Bradford, Columbia, and Union achieving statehood (Pollard v. Hagan, km (6.2 mi) to GA Highway 111 in counties, Florida. The main stem of the 44 U.S. (3 How.) 212 (1845)). Prior Grady County, Georgia; and Little Santa Fe River as proposed extends sovereigns or the States may have made Ochlockonee River, from the from where the river goes underground grants to private parties that included Ochlockonee River upstream 13.3 km in O’Leno State Park in Alachua and lands below the ordinary high water (8.3 mi) to Roup Road/County Road 33 Columbia counties, Florida (the river is mark of some navigable waters that are in Thomas County, Georgia. the county boundary) upstream 60.2 km included in this proposal. We believe Unit 9 is designated for the (37.4 mi) to the powerline crossing that most, if not all, lands beneath the shinyrayed pocketbook (Blalock-Herod located 1.9 km (1.2 mi) downstream of navigable waters included in this 2003, p. 1; McCafferty pers. comm. U.S. Highway 301 in Alachua and proposed rule are owned by the States 2003; Williams unpub. data 1993), Bradford counties, Florida (the river is of Alabama, Florida, and Georgia. The Ochlockonee moccasinshell (Brim Box the county boundary). The New River in lands beneath most nonnavigable waters and Williams 2000, p. 60; Williams and proposed Unit 11 extends from its and most riparian lands along the Butler 1994, p. 64), oval pigtoe confluence with the Santa Fe River at navigable and nonnavigable waters (Edwards Pittman Environmental 2004; the junction of Alachua, Bradford, and included in this proposed rule are in Blalock-Herod unpub. data 2003; Union counties, Florida, upstream 22.9 private ownership. Table 2 lists the Blalock-Herod 2003, p. 1; Williams km (14.2 mi) to McKinney Branch in parcels of publicly owned lands within unpub. data 1993), and purple Bradford and Union counties, Florida or adjacent to each proposed critical bankclimber (Blalock-Herod unpub. (the river is the county boundary). Unit habitat unit. Units not listed do not data 2003; Blalock-Herod 2002, p. 1; 11 is designated for the oval pigtoe contain publicly owned lands.

TABLE 2.—PUBLIC LANDS WITHIN OR ADJACENT TO PROPOSED CRITICAL HABITAT UNITS

Critical habitat unit Public lands

1. Econfina Creek ...... Econfina Creek WtrMA. 2. Chipola River ...... Upper Chipola River WtrMA, South Marianna Trail and Canoe Launch, Apalachicola River WtrMA, Apa- lachicola River WEA, Chipola River GW, Florida Caverns SP, Judges Cave WEA, Marianna GW. 5. Upper Flint ...... Joe Kurz WMA, Sprewell Bluff SP and WMA, Big Lazer WMA, Montezuma NA, Flint River WMA. 7. Lower Flint ...... Flint River GW, Radium Springs Tract, Chickasawhatchee Flint WMA, Elmodel WMA, Lake Seminole WMA. 8. Apalachicola River ...... Angus Gholson Jr. Nature Park of Chattahoochee, Apalachicola River WtrMA, Apalachicola River WEA, Fort Gadsden HS, Torreya SP, Apalachicola NF. 9. Upper Ochlockonee ...... Joe Budd WMA, Lake Talquin SF. 10. Lower Ochlockonee ...... Lake Talquin SP, Lake Talquin SF, Tate’s Hell SF, Apalachicola NF. 11. Santa Fe River and New River Santa Fe River Ranch, O’Leno SP, River Rise Preserve SP, Graham CA, Palatka-Lake Butler ST. Abbreviations: CA = Conservation Area, GW = Greenway, HS = Historic Site, NA = Natural Area, NF = National Forest, SF = State Forest, SP = State Park, ST = State Trail, WEA = Wildlife and Environmental Area, WMA = Wildlife Management Area, WtrMA = Water Management Area.

Effects of Critical Habitat Designation regulations at 50 CFR 402.02, we define of those physical or biological features destruction or adverse modification as that were the basis for determining the Section 7 Consultation ‘‘a direct or indirect alteration that habitat to be critical.’’ However, recent Section 7 of the Act requires Federal appreciably diminishes the value of decisions by the 5th and 9th Circuit agencies, including the Service, to critical habitat for both the survival and Court of Appeals (see Gifford Pinchot ensure that actions they fund, authorize, recovery of a listed species. Such Task Force v. U.S. Fish and Wildlife or carry out are not likely to destroy or alterations include, but are not limited Service, 378 F. 3d 1059 (9th Cir 2004) adversely modify critical habitat. In our to, alterations adversely modifying any and Sierra Club v. U.S. Fish and

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Wildlife Service et al., 245 F.3d 434, opinions on proposed critical habitat are discretionary involvement or control is 442F (5th Cir 2001). Also see discussion typically prepared according to 50 CFR authorized by law. Consequently, some on Role of Critical Habitat above) have 402.14, as if the proposed critical Federal agencies may request invalidated this definition. Pursuant to habitat were designated. We may adopt reinitiation of consultation with us on current national policy and the statutory the conference opinion as the biological actions for which formal consultation provisions of the Act, destruction or opinion when the critical habitat is has been completed, if those actions adverse modification is determined on designated, if no substantial new may affect subsequently listed species the basis of whether, with information or changes in the action or designated critical habitat or implementation of the proposed Federal alter the content of the opinion (see 50 adversely modify or destroy proposed action, the affected critical habitat CFR 402.10(d)). Any conservation critical habitat. would remain functional (or retain the recommendations in a conference report Federal activities that may affect any current ability for the PCEs to be or opinion are strictly advisory. of the seven species or their designated functionally established) to serve the If a species is listed or critical habitat critical habitat will require section 7 intended conservation role for the is designated, section 7(a)(2) of the Act consultation under the Act. Activities species. requires Federal agencies to ensure that on State, Tribal, local, or private lands Section 7(a) of the Act requires activities they authorize, fund, or carry requiring a Federal permit (such as a Federal agencies, including the Service, out are not likely to jeopardize the permit from the USACE under section to evaluate their actions with respect to continued existence of such a species or 404 of the Clean Water Act or a permit any species that is proposed or listed as to destroy or adversely modify its under section 10(a)(1)(B) of the Act from endangered or threatened and with critical habitat. If a Federal action may the Service) or involving some other respect to its critical habitat, if any is affect a listed species or its critical Federal action (such as funding from the proposed or designated. Regulations habitat, the responsible Federal agency Federal Highway Administration, implementing this interagency (action agency) must enter into Federal Aviation Administration, or the cooperation provision of the Act are consultation with us. As a result of this Federal Emergency Management codified at 50 CFR part 402. consultation, compliance with the Agency) will also be subject to the Section 7(a)(4) of the Act requires requirements of section 7(a)(2) will be section 7 consultation process. Federal Federal agencies to confer with us on documented through the Service’s actions not affecting listed species or any action that is likely to jeopardize issuance of: (1) A concurrence letter for critical habitat, and actions on State, the continued existence of a proposed Federal actions that may affect, but are Tribal, local, or private lands that are species or result in destruction or not likely to adversely affect, listed not federally funded, authorized, or adverse modification of proposed species or critical habitat; or (2) a permitted, do not require section 7 critical habitat. However, once a biological opinion for Federal actions consultations. proposed species becomes listed, or that are likely to adversely affect listed proposed critical habitat is designated species or critical habitat. Application of the Jeopardy and as final, the full prohibitions of section When we issue a biological opinion Adverse Modification Standards for 7(a)(2) apply to any Federal action. The concluding that a project is likely to Actions Involving Effects to the Seven primary utility of the conference result in jeopardy to a listed species or Mussels and Their Critical Habitat procedures is to maximize the the destruction or adverse modification Jeopardy Standard opportunity for a Federal agency to of critical habitat, we also provide adequately consider proposed species reasonable and prudent alternatives to Prior to and following designation of and critical habitat and avoid potential the project, if any are identifiable. critical habitat, the Service has applied delays in implementing their proposed ‘‘Reasonable and prudent alternatives’’ an analytical framework for jeopardy action as a result of the section 7(a)(2) are defined at 50 CFR 402.02 as analyses of the seven mussels that relies compliance process, should those alternative actions identified during heavily on the importance of core area species be listed or the critical habitat consultation that can be implemented in populations to the mussels’ survival and designated. a manner consistent with the intended recovery. The section 7(a)(2) analysis is Under conference procedures, the purpose of the action, that are consistent focused not only on these populations Service may provide advisory with the scope of the Federal agency’s but also on the habitat conditions conservation recommendations to assist legal authority and jurisdiction, that are necessary to support them. the agency in eliminating conflicts that economically and technologically The jeopardy analysis usually may be caused by the proposed action. feasible, and that the Director believes expresses the survival and recovery The Service may conduct either would avoid jeopardy to the listed needs of the seven mussels in a informal or formal conferences. Informal species or destruction or adverse qualitative fashion without making conferences are typically used if the modification of critical habitat. distinctions between what is necessary proposed action is not likely to have any Reasonable and prudent alternatives can for survival and what is necessary for adverse effects on the proposed species vary from slight project modifications to recovery. Generally, if a proposed or proposed critical habitat. Formal extensive redesign or relocation of the Federal action is incompatible with the conferences are typically used when the project. Costs associated with viability of the affected core area Federal agency or the Service believes implementing a reasonable and prudent population(s), inclusive of associated the proposed action is likely to cause alternative are similarly variable. habitat conditions, a jeopardy finding is adverse effects on proposed species or Regulations at 50 CFR 402.16 require considered to be warranted, because of critical habitat, inclusive of those that Federal agencies to reinitiate the relationship of each core area may cause jeopardy or adverse consultation on previously reviewed population to the survival and recovery modification. actions in instances where a new of the species as a whole. The results of an informal conference species is listed or critical habitat is are typically transmitted in a conference subsequently designated that may be Adverse Modification Standard report; while the results of a formal affected and the Federal agency has The analytical framework described conference are typically transmitted in a retained discretionary involvement or in the Director’s December 9, 2004, conference opinion. Conference control over the action or such memorandum is used to complete

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section 7(a)(2) analyses for Federal vehicle use, and other activities that consult with us on actions in areas actions affecting the seven mussels’ increase erosion rates in the channel or currently occupied by and that may critical habitat. The key factor related to the watershed and deposition of fine affect the seven mussels to ensure that the adverse modification determination sediments. These activities could reduce these actions do not jeopardize the is whether, with implementation of the or eliminate the coarse substrates that mussels’ continued existence. proposed Federal action, the affected provide for the normal behavior, Application of Section 3(5)(a) and critical habitat would remain functional growth, and survival of all life stages, Exclusions Under Section 4(b)(2) of the (or retain the current ability for the PCEs and could increase the exposure of the Act to be functionally established) to serve juvenile and adult life stages to harmful the intended conservation role for the contaminants that adhere to fine The 11 units we propose as critical species. Generally, the conservation role sediments. habitat satisfy the definition of critical of the seven mussels’ critical habitat (3) Actions that would significantly habitat under section 3(5)(A) of the Act units is to support viable core area alter the flow regime. Such activities in that each is a specific area within the populations. could include, but are not limited to, the geographical area occupied by one or Section 4(b)(8) of the Act requires us construction and operation of dams, more of the seven mussels at the time to briefly evaluate and describe in any water withdrawals, water diversions, of listing within which are found those proposed or final regulation that and changes in land cover that physical and biological features that are designates critical habitat those substantially alter the runoff essential to their conservation and that activities involving a Federal action that characteristics of the watershed, such as may require special management may destroy or adversely modify such urbanization and clear-cut logging. considerations or protection (see habitat, or that may be affected by such These activities could alter the spatial ‘‘Primary Constituent Elements’’, designation. Activities that may destroy distribution, timing, and duration of ‘‘Criteria Used to Delineate Critical or adversely modify critical habitat may depths and velocities in the channel Habitat’’, and ‘‘Special Management also jeopardize the continued existence that provide for the normal behavior, Considerations or Protection’’). We of the species. growth, and survival of one or more considered whether conservation Activities that may destroy or mussel life stages. activity on publicly or privately adversely modify critical habitat are (4) Actions that would significantly managed lands within a proposed unit those that alter the PCEs to an extent alter physical and chemical water might remove the need for special that the conservation value of critical conditions. Such activities could management considerations or habitat for the seven mussels is include, but are not limited to, the protection from all or part of a unit. appreciably reduced. Activities that, release of chemicals, nutrients, Several stream reaches within the when carried out, funded, or authorized biological pollutants, or heated effluents proposed critical habitat units run by a Federal agency, may affect critical into the surface water or connected through or adjacent to public lands that habitat and therefore result in groundwater at a point source or by are managed wholly or partially for consultation for the seven mussels dispersed release (non-point source). conservation purposes (see ‘‘Land include, but are not limited to: These activities could alter water Ownership’’). None of the management (1) Actions that would induce conditions that provide for the normal plans for these areas provide assurance channel instability or significantly alter behavior, growth, and survival of one or of effective conservation for the mussels channel morphology. Such activities more mussel life stages. These activities or features essential to their could include, but are not limited to, could promote the excessive growth of conservation, because all of the areas are channelization, impoundment, road and filamentous algae and other organisms affected to some degree by threats bridge construction, mining, dredging, that preclude the normal behavior, upstream and outside of their destruction of riparian vegetation, and growth, and survival of one or more boundaries that may degrade one or changes in land cover, such as mussel life stages. more of the PCEs within their urbanization and clear-cut logging, that (5) Actions that would significantly boundaries. We describe PCE- and unit- substantially alter the runoff reduce the density of host fishes. Such specific threats under ‘‘Special characteristics of the watershed. These activities could include, but are not Management Considerations or activities may alter sediment and water limited to, channelization, Protection.’’ At this time, the Service discharge in the channel, which results impoundment, mining, and dredging. has not received applications for or in smothering the stream bed with, or These activities could alter the issued incidental take permits that eroding it to, materials that are composition of the fish community such would require an HCP for one or more unsuitable substrates for the normal that the rate of host fish infection and of the seven mussels. Further, we do not behavior, growth, and survival of the completion of the larval life stage is too foresee not including particular areas in adult and juvenile life stages. These low to sustain a stable or increasing this proposal that are occupied and activities may initiate or accelerate bank mussel population and normal rates of contain the PCEs but do not require erosion, which results in wider and dispersal and genetic exchange with special management or protection. shallower channels, more extreme other areas. Under section 4(b)(2) of the Act, we temperatures, and chemical properties We consider all of the units proposed must consider the economic impact, that are unsuitable for the normal as critical habitat to contain features impact on national security, and any behavior, growth, and survival of one or essential to the conservation of the other relevant impact of designating more life stages. seven mussels. All of the units are areas as critical habitat. We may exclude (2) Actions that would significantly within the geographic range of the seven any area from critical habitat if we decrease the proportion of coarse species, were occupied at the time of determine that the benefits of exclusion sediments (sand, gravel, cobble) in the listing (based on surveys completed outweigh the benefits of inclusion. stream bed. Such activities could 1990 to 1998), and are likely occupied include, but are not limited to, currently (based on additional surveys Benefits of Inclusion sedimentation from livestock grazing, between 1998 and the present, and on The most direct benefit of critical road and bridge construction, mining, the longevity and relative immobility of habitat is that actions taken, authorized, dredging, timber harvest, off-road mussels). Federal agencies already or funded by the Federal government

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require consultation under section 7 of Fish and Wildlife Office directly (see reduce its clarity? (4) Is the description the Act to ensure that these actions are ADDRESSES section). For further of the notice in the SUPPLEMENTARY not likely to destroy or adversely modify explanation, see the ‘‘Regulatory INFORMATION section of the preamble critical habitat (see ‘‘Effects of Critical Flexibility Act’’ and ‘‘Regulatory helpful in understanding the proposed Habitat Designation—Section 7 Planning and Review’’ discussions rule? (5) What else could we do to make Consultation’’). This regulatory benefit below. this proposed rule easier to understand? has two principal limitations. First, it Send a copy of any comments on how Peer Review applies only to Federal actions and not we could make this proposed rule easier to other actions that may destroy or In accordance with our joint policy to understand to: Office of Regulatory adversely modify critical habitat. published in the Federal Register on Affairs, Department of the Interior, Second, it ensures only that designated July 1, 1994 (59 FR 34270), we will seek Room 7229, 1849 C Street, NW., areas are not destroyed or adversely the expert opinions of at least three Washington, DC 20240. You may e-mail modified and does not require specific appropriate and independent specialists your comments to this address: steps toward recovery. regarding this proposed rule. The [email protected]. Another benefit of critical habitat is purpose of such review is to ensure that that its designation serves to educate our critical habitat designation is based Required Determinations landowners, State and local on scientifically sound data, Regulatory Planning and Review governments, and the general public. By assumptions, and analyses. We will clearly delineating areas of high send copies of this proposed rule to In accordance with Executive Order conservation value, designation may these peer reviewers immediately 12866, this document is a significant help focus and promote conservation following publication in the Federal rule in that it may raise novel legal and efforts for the seven mussels. Register. We will invite these peer policy issues, but it is not anticipated to Designation informs State agencies and reviewers to comment, during the have an annual effect on the economy local governments about areas that they public comment period, on the specific of $100 million or more or affect the may consider for protection or assumptions and conclusions regarding economy in a material way. Due to the conservation under State laws or local the proposed designation of critical tight timeline for publication in the ordinances. habitat. Federal Register, the Office of We will consider all comments and Management and Budget (OMB) has not Benefits of Exclusion information received during the formally reviewed this rule. We are Because the regulatory effect of comment period on this proposed rule preparing a draft economic analysis of critical habitat is limited to Federal during preparation of a final this proposed action, which will be actions, the non-economic impacts of rulemaking. Accordingly, the final available for public comment, to critical habitat are generally limited to decision may differ from this proposal. determine the economic consequences Federal lands, partnerships, and trust of designating the specific areas as resources. We have determined that the Public Hearings critical habitat. This economic analysis streams within the proposed critical The Act provides for one or more also will be used to determine habitat units for the seven mussels are public hearings on this proposal, if compliance with Executive Order not owned or managed by the requested. Requests for public hearings 12866, Regulatory Flexibility Act, Small Department of Defense, there are must be made in writing at least 15 days Business Regulatory Enforcement currently no HCPs for the seven prior to the close of the public comment Fairness Act, and Executive Order mussels, and the proposed designation period. We intend to schedule public 12630. does not include any Tribal lands. We hearings once the draft economic Within these areas, the types of anticipate no impact to national analysis is available so that we can take Federal actions or authorized activities security, Tribal lands, partnerships, or public comment on the proposed that we have identified as potential habitat conservation plans from this designation and the economic analysis concerns are listed above in the section critical habitat designation as proposed. simultaneously. However, we can on Section 7 Consultation. The Based on the best available schedule public hearings on this availability of the draft economic information, we believe that the benefits proposal prior to that time, if any are analysis will be announced in the of designating each of the 11 units we requested, and announce the dates, Federal Register and in local propose as critical habitat outweigh the times, and places of those hearings in newspapers so that it is available for non-economic benefits of excluding any the Federal Register and local public review and comments. The draft specific areas within those units. We newspapers at least 15 days prior to the economic analysis can be obtained from will evaluate potential economic first hearing. the Internet Web site at http:// benefits of exclusion in a separate notice www.fws.gov/panamacity/ or by Clarity of the Rule (see ‘‘Economic Analysis’’). contacting the Panama City, Florida, Executive Order 12866 requires each Fish and Wildlife Service office directly Economic Analysis agency to write regulations and notices (see ADDRESSES section). An analysis of the economic impacts that are easy to understand. We invite of proposing critical habitat for the your comments on how to make this Regulatory Flexibility Act (5 U.S.C. 601 seven mussels is being prepared. We proposed rule easier to understand, et seq.) will announce the availability of the including answers to questions such as Our assessment of economic effect draft economic analysis as soon as it is the following: (1) Are the requirements will be completed prior to final completed, at which time we will seek in the proposed rule clearly stated? (2) rulemaking based upon review of the public review and comment. At that Does the proposed rule contain draft economic analysis prepared time, copies of the draft economic technical jargon that interferes with the pursuant to section 4(b)(2) of the Act analysis will be available for clarity? (3) Does the format of the and E.O. 12866. This analysis is for the downloading from the Internet at http:// proposed rule (grouping and order of purposes of compliance with the www.fws.gov/panamacity/ or by the sections, use of headings, Regulatory Flexibility Act and does not contacting the Panama City, Florida, paragraphing, and so forth) aid or reflect our position on the type of

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economic analysis required by New energy supply, distribution, and use. on non-Federal Government entities or Mexico Cattle Growers Assn. v. U.S. Executive Order 13211 requires agencies private parties. Under the Act, the only Fish and Wildlife Service 248 F.3d 1277 to prepare Statements of Energy Effects regulatory effect is that Federal agencies (10th Cir. 2001). when undertaking certain actions. This must ensure that their actions do not Under the Regulatory Flexibility Act proposed rule to designate critical destroy or adversely modify critical (5 U.S.C. 601 et seq., as amended by the habitat for the seven mussels is a habitat under section 7. While non- Small Business Regulatory Enforcement significant rule under Executive Order Federal entities that receive Federal Fairness Act (SBREFA) of 1996), 12866 in that it may raise novel legal funding, assistance, or permits, or that whenever an agency is required to and policy issues, but it is not expected otherwise require approval or publish a notice of rulemaking for any to significantly affect energy supplies, authorization from a Federal agency for proposed or final rule, it must prepare distribution, or use. Therefore, this an action, may be indirectly impacted and make available for public comment action is not a significant energy action, by the designation of critical habitat, the a regulatory flexibility analysis that and no Statement of Energy Effects is legally binding duty to avoid describes the effects of the rule on small required. destruction or adverse modification of entities (small businesses, small critical habitat rests squarely on the Unfunded Mandates Reform Act (2 organizations, and small government Federal agency. Furthermore, to the U.S.C. 1501 et seq.) jurisdictions). However, no regulatory extent that non-Federal entities are flexibility analysis is required if the In accordance with the Unfunded indirectly impacted because they head of the agency certifies the rule will Mandates Reform Act (2 U.S.C. 1501), receive Federal assistance or participate not have a significant economic impact the Service makes the following in a voluntary Federal aid program, the on a substantial number of small findings: Unfunded Mandates Reform Act would entities. The SBREFA amended the (a) This rule will not produce a not apply; nor would critical habitat Regulatory Flexibility Act (RFA) to Federal mandate. In general, a Federal shift the costs of the large entitlement require Federal agencies to provide a mandate is a provision in legislation, programs listed above on to State statement of the factual basis for statute, or regulation that would impose governments. certifying that the rule will not have a an enforceable duty upon State, local, or (b) We do not believe that this rule significant economic impact on a Tribal governments, or the private sector will significantly or uniquely affect substantial number of small entities. and includes both ‘‘Federal small governments because the At this time, the Service lacks the intergovernmental mandates’’ and proposed units are streams, available economic information ‘‘Federal private sector mandates.’’ unauthorized take of the seven mussels necessary to provide an adequate factual These terms are defined in 2 U.S.C. within and outside the units is already basis for the required RFA finding. 658(5)–(7). ‘‘Federal intergovernmental prohibited, and critical habitat provides Therefore, the RFA finding is deferred mandate’’ includes a regulation that no incremental restrictions. As such, a until completion of the draft economic ‘‘would impose an enforceable duty Small Government Agency Plan is not analysis prepared pursuant to section upon State, local, or tribal governments’’ required. We will, however, further 4(b)(2) of the Act and E.O. 12866. This with two exceptions. It excludes ‘‘a evaluate this issue as we conduct our draft economic analysis will provide the condition of Federal assistance.’’ It also economic analysis and revise this required factual basis for the RFA excludes ‘‘a duty arising from assessment if appropriate. finding. Upon completion of the draft participation in a voluntary Federal economic analysis, the Service will program,’’ unless the regulation ‘‘relates Federalism publish a notice of availability of the to a then-existing Federal program In accordance with Executive Order draft economic analysis of the proposed under which $500,000,000 or more is 13132, the rule does not have significant designation and reopen the public provided annually to State, local, and Federalism effects. A Federalism comment period for the proposed tribal governments under entitlement assessment is not required. In keeping designation. The Service will include authority,’’ if the provision would with DOI and Department of Commerce with the notice of availability, as ‘‘increase the stringency of conditions of policy, we requested information from, appropriate, an initial regulatory assistance’’ or ‘‘place caps upon, or and coordinated development of, this flexibility analysis or a certification that otherwise decrease, the Federal proposed critical habitat designation the rule will not have a significant Government’s responsibility to provide with appropriate State resource agencies economic impact on a substantial funding,’’ and the State, local, or tribal in Alabama, Florida, and Georgia. The number of small entities accompanied governments ‘‘lack authority’’ to adjust designation of critical habitat in areas by the factual basis for that accordingly. At the time of enactment, currently occupied by the seven determination. The Service has these entitlement programs were: mussels, we believe, imposes little to no concluded that deferring the RFA Medicaid; AFDC work programs; Child additional restrictions to those currently finding until completion of the draft Nutrition; Food Stamps; Social Services in place and, therefore, has little economic analysis is necessary to meet Block Grants; Vocational Rehabilitation incremental impact on State and local the purposes and requirements of the State Grants; Foster Care, Adoption governments and their activities. The RFA. Deferring the RFA finding in this Assistance, and Independent Living; designation may have some benefit to manner will ensure that the Service Family Support Welfare Services; and these governments in that the areas that makes a sufficiently informed Child Support Enforcement. ‘‘Federal contain the features essential to the determination based on adequate private sector mandate’’ includes a conservation of the species are more economic information and provides the regulation that ‘‘would impose an clearly defined, and the primary necessary opportunity for public enforceable duty upon the private constituent elements of the habitat comment. sector, except (i) a condition of Federal necessary to the conservation of the assistance or (ii) a duty arising from species are specifically identified. While Executive Order 13211 participation in a voluntary Federal making this definition and On May 18, 2001, the President issued program.’’ identification does not alter where and an Executive Order (E.O. 13211) on The designation of critical habitat what federally sponsored activities may regulations that significantly affect does not impose a legally binding duty occur, it may assist these local

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governments in long-range planning defined by the NEPA in connection with Author (rather than waiting for case-by-case designating critical habitat under the section 7 consultations to occur). Endangered Species Act of 1973, as The primary author of this package is amended. We published a notice the Panama City Fish and Wildlife Civil Justice Reform outlining our reasons for this Office (see ADDRESSES section). In accordance with Executive Order determination in the Federal Register List of Subjects in 50 CFR Part 17 12988, the Office of the Solicitor has on October 25, 1983 (48 FR 49244). This determined that the rule does not assertion was upheld in the courts of the Endangered and threatened species, unduly burden the judicial system and Ninth Circuit (Douglas County v. Exports, Imports, Reporting and meets the requirements of sections 3(a) Babbitt, 48 F.3d 1495 (9th Cir. Ore. recordkeeping requirements, and 3(b)(2) of the Order. We have 1995), cert. denied 116 S. Ct. 698 Transportation. proposed designating critical habitat in (1996)). accordance with the provisions of the Proposed Regulation Promulgation Act. This proposed rule uses standard Government-to-Government Relationship With Tribes Accordingly, we propose to amend property descriptions and identifies the part 17, subchapter B of chapter I, title primary constituent elements within the In accordance with the President’s 50 of the Code of Federal Regulations, designated areas to assist the public in memorandum of April 29, 1994, as set forth below: understanding the habitat needs of the ‘‘Government-to-Government Relations seven mussels. with Native American Tribal PART 17—[AMENDED] Governments’’ (59 FR 22951), Executive Paperwork Reduction Act of 1995 (44 Order 13175, and the Department of 1. The authority citation for part 17 U.S.C. 3501 et seq.) Interior’s manual at 512 DM 2, we continues to read as follows: This rule does not contain any new readily acknowledge our responsibility Authority: 16 U.S.C. 1361–1407; 16 U.S.C. collections of information that require to communicate meaningfully with 1531–1544; 16 U.S.C. 4201–4245; Pub. L. 99– approval by OMB under the Paperwork recognized Federal Tribes on a 625, 100 Stat. 3500; unless otherwise noted. Reduction Act. This rule will not government-to-government basis. We impose recordkeeping or reporting have determined that there are no tribal 2. In § 17.11(h), revise the entries for requirements on State or local lands with features essential to the ‘‘Bankclimber, purple (mussel),’’ governments, individuals, businesses, or conservation of the seven mussels. ‘‘Moccasinshell, Gulf,’’ ‘‘Moccasinshell, organizations. An agency may not Therefore, critical habitat for the seven Ochlockonee,’’ ‘‘Pigtoe, oval,’’ conduct or sponsor, and a person is not mussels has not been designated on ‘‘Pocketbook, shinyrayed,’’ ‘‘Slabshell, required to respond to, a collection of tribal lands. Chipola,’’ and ‘‘Threeridge, fat information unless it displays a (mussel),’’ listed in alphabetical order References Cited currently valid OMB control number. under ‘‘CLAMS’’ to read as follows: A complete list of all references cited National Environmental Policy Act in this rulemaking is available upon § 17.11 Endangered and threatened wildlife. It is our position that, outside the request from the Field Supervisor, Tenth Circuit, we do not need to Panama City Fish and Wildlife Office * * * * * prepare environmental analyses as (see ADDRESSES section). (h) * * *

Species Vertebrate popu- Historic range lation where endan- Status When listed Critical Special Common name Scientific name gered or threatened habitat rules

******* CLAMS

******* Bankclimber, purple Elliptoideus U.S.A. (AL, FL, GA) NA ...... T 633 17.95(f) NA (mussel). sloatianus.

******* Moccasinshell, Gulf Medionidus U.S.A. (AL, FL, GA) NA ...... E 633 17.95(f) NA penicillatus.

******* Moccasinshell, Medionidus U.S.A. (FL, GA) ...... NA ...... E 633 17.95(f) NA Ochlockonee. simpsonianus.

******* Pigtoe, oval ...... Pleurobema U.S.A. (AL, FL, GA) NA ...... E 633 17.95(f) NA pyriforme.

******* Pocketbook, Lampsilis U.S.A. (AL, FL, GA) NA ...... E 633 17.95(f) NA shinyrayed. subangulata.

******* Slabshell, Chipola .... Elliptio chipolaensis U.S.A. (AL, FL) ...... NA ...... T 633 17.95(f) NA

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Species Vertebrate popu- Historic range lation where endan- Status When listed Critical Special Common name Scientific name gered or threatened habitat rules

******* Threeridge, fat (mus- Amblema neislerii ... U.S.A. (FL, GA) ...... NA ...... E 633 17.95(f) NA sel).

*******

3. In § 17.95, at the end of paragraph Spalding, Sumter, Talbot, Taylor, (3) Critical habitat does not include (f), add an entry for seven mussel Terrell, Thomas, Upson, Webster, and manmade structures (such as buildings, species (in four northeast Gulf of Worth. aqueducts, airports, roads, and other Mexico drainages) to read as follows: (2) The primary constituent elements paved areas, and the land on which such structures are located) existing on § 17.95 Critical habitat—fish and wildlife. of critical habitat for the purple bankclimber (Elliptoideus sloatianus), the effective date of this rule and not * * * * * Gulf moccasinshell (Medionidus containing one or more of the primary (f) Clams and snails. penicillatus), Ochlockonee constituent elements. * * * * * moccasinshell (Medionidus (4) Critical habitat unit maps. Data Seven mussel species (in four simpsonianus), oval pigtoe (Pleurobema layers defining map units were created northeast Gulf of Mexico drainages): pyriforme), shinyrayed pocketbook with USGS National Hydrography purple bankclimber (Elliptoideus (Lampsilis subangulata), Chipola Dataset (NHD) GIS data. The 1:100,000 sloatianus), Gulf moccasinshell slabshell (Elliptio chipolaensis), and fat river reach (route) files were used to (Medionidus penicillatus), Ochlockonee threeridge (Amblema neislerii) are: calculate river kilometers and miles. moccasinshell (Medionidus (i) A geomorphically stable stream The following data sources were simpsonianus), oval pigtoe (Pleurobema channel (a channel that maintains its referenced to identify upstream and pyriforme), shinyrayed pocketbook downstream extents of critical habitat lateral dimensions, longitudinal profile, ′ (Lampsilis subangulata), Chipola and spatial pattern over time without an units: USGS 7.5 quadrangles; Georgia slabshell (Elliptio chipolaensis), and fat aggrading or degrading bed elevation); Department of Transportation county threeridge (Amblema neislerii). highway maps; U.S. Census Bureau (ii) A predominantly sand, gravel, (1) Critical habitat units are depicted 1:100,000 TIGER line road data; 1993 and/or cobble stream substrate; on the maps below for the following Georgia digital orthographic quarter counties: (iii) Permanently flowing water; quads (DOQQs); 2004 Florida DOQQs; (i) Alabama: Houston and Russell; (iv) Water quality (including and DeLorme Atlas and Gazetteers for (ii) Florida: Alachua, Bay, Bradford, temperature, turbidity, dissolved Alabama, Florida, and Georgia. The Calhoun, Columbia, Franklin, Gadsden, oxygen, and chemical constituents) that projection used in mapping all units Gulf, Jackson, Leon, Liberty, Union, meets or exceeds the current aquatic life was Universal Transverse Mercator Wakulla, and Washington; and criteria established under the Clean (UTM), NAD 83, Zone 16 North. (iii) Georgia: Baker, Calhoun, Clayton, Water Act (33 U.S.C. 1251–1387); and (5) Note: Index map (Map 1) showing Coweta, Crawford, Crisp, Decatur, (v) Fish hosts (such as largemouth critical habitat units in the States of Dooly, Dougherty, Early, Fayette, Grady, bass, sailfin shiner, brown darter) that Alabama, Florida, and Georgia for the Lee, Macon, Marion, Meriwether, support the larval life stages of the seven mussels follows: Miller, Mitchell, Peach, Pike, Schley, seven mussels. BILLING CODE 4310–55–P

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(6) Table of listed species and critical species, their respective critical habitat habitat units follows. Detailed critical habitat units. A table showing the listed units, and the States that contain those habitat unit descriptions and maps

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appear below in paragraphs (7) through (17).

TABLE OF SEVEN MUSSEL SPECIES, THEIR CRITICAL HABITAT UNITS, AND STATES CONTAINING THOSE CRITICAL HABITAT UNITS

Species Critical habitat units States

Purple bankclimber (Elliptoideus sloatianus) ...... Units 5, 6, 7, 8, 9, 10 ...... AL, FL, GA. Gulf moccasinshell (Medionidus penicillatus) ...... Units 1, 2, 4, 5, 6, 7 ...... AL, FL, GA. Ochlockonee moccasinshell (Medionidus simpsonianus) ...... Unit 9 ...... FL, GA. Oval pigtoe (Pleurobema pyriforme) ...... Units 1, 2, 4, 5, 6, 7, 9, 11 ...... AL, FL, GA. Shinyrayed pocketbook (Lampsilis subangulata) ...... Units 2, 3, 4, 5, 6, 7, 9 ...... AL, FL, GA. Chipola slabshell (Elliptio chipolaensis) ...... Unit 2 ...... AL, FL. Fat threeridge (mussel) (Amblema neislerii) ...... Units 2, 8 ...... AL, FL, GA.

(7) Unit 1. Econfina and Moccasin stream length of 31.4 kilometers (km) (17.8 mi) to Tenmile Creek (¥85.50 creeks, Bay and Washington Counties, (19.5 miles (mi)). The main stem of longitude, 30.51 latitude), Washington Florida. This is a critical habitat unit for Econfina Creek extends from its County, Florida; and Moccasin Creek the Gulf moccasinshell and oval pigtoe. confluence with Deer Point Lake at the from its confluence with Econfina Creek (i) General Description: Unit 1 powerline crossing located 3.8 km (2.3 upstream 2.8 km (1.7 mi) to Ellis Branch includes the main stem of Econfina mi) downstream of Bay County Highway (¥85.53 longitude, 30.41 latitude), Bay Creek and one of its tributaries, 388 (¥85.56 longitude 30.36 latitude), County, Florida. Moccasin Creek, encompassing a total Bay County, Florida, upstream 28.6 km (ii) Note: Unit 1 map (Map 2) follows:

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(8) Unit 2. Chipola River and Dry, km (90.0 mi), including the reach upstream 5.3 km (3.3 mi) to Tanner Rocky, Waddells Mill, Baker, Marshall, known as Dead Lake, to the confluence Springs (¥85.32 longitude, 30.83 and Big Creeks; Houston County, of Marshall and Cowarts creeks (¥85.27 latitude), Jackson County, Florida; Alabama; and Calhoun, Gulf, and longitude, 30.91 latitude) in Jackson Marshall Creek from the Chipola River Jackson counties, Florida. This is a County, Florida; Dry Creek from the upstream 13.7 km (8.5 mi) to the critical habitat unit for the fat Chipola River upstream 7.6 km (4.7 mi) Alabama-Florida State line (¥85.33 threeridge, shinyrayed pocketbook, Gulf to Ditch Branch (¥85.53 longitude, longitude, 31.00 latitude), Jackson moccasinshell, oval pigtoe, and Chipola 30.41 latitude), Jackson County, Florida; County, Florida; and Big Creek from the slabshell. Rocky Creek from the Chipola River Alabama-Florida State line upstream 7.8 (i) General Description: Unit 2 upstream 7.1 km (4.4 mi) to Little Rocky km (4.9 mi) to Double Bridges Creek includes the main stem of the Chipola ¥ (¥85.38 longitude, 31.05 latitude), River and six of its tributaries, Creek ( 85.13 longitude, 30.68 Houston County, Alabama. The short encompassing a total stream length of latitude), Jackson County, Florida; 190.0 km (118.1 mi). The main stem of Waddells Mill Creek from the Chipola segment of the Chipola River that flows the Chipola River extends from its River upstream 3.7 km (2.3 mi) to Russ underground within the boundaries of ¥ confluence with the Apalachicola River Mill Creek ( 85.29 longitude, 30.87 Florida Caverns State Park is not (¥85.09 longitude, 30.01 latitude) in latitude), Jackson County, Florida; Baker included within this unit. Gulf County, Florida, upstream 144.9 Creek from Waddells Mill Creek (ii) Note: Unit 2 map (Map 3) follows:

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(9) Unit 3. Uchee Creek, Russell habitat unit for the shinyrayed (i) General Description: Unit 3 County, Alabama. This is a critical pocketbook. includes the main stem of Uchee Creek

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from its confluence with the longitude, 32.38 latitude), Russell (ii) Note: Unit 3 map (Map 4) follows: Chattahoochee River upstream 34.2 km County, Alabama, encompassing a total (21.2 mi) to Island Creek (¥85.18 stream length of 34.2 km (21.2 mi).

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(10) Unit 4. Sawhatchee, Sheffield 37.8 km (23.5 mi). Sawhatchee Creek km (1.9 mi) to the powerline crossing Mill, and Kirkland creeks, Early County, from its confluence with the located 2.3 km (1.4 mi) upstream of Georgia. This is a critical habitat unit for Chattahoochee River upstream 28.6 km Sowhatchee Road (¥85.01 longitude, the shinyrayed pocketbook, Gulf (17.8 mi) to the powerline crossing 31.23 latitude); Kirkland Creek from its moccasinshell, and oval pigtoe. located 1.4 km (0.87 mi) upstream of confluence with the Chattahoochee (i) General Description: Unit 4 Early County Road 15 (¥84.99 River upstream 6.1 km (3.8 mi) to Dry includes the main stems of Sawhatchee longitude, 31.32 latitude); Sheffield Mill Creek (¥85.00 longitude, 31.13 and Kirkland creeks, and one tributary, Creek, the tributary, from its confluence latitude). encompassing a total stream length of with Sawhatchee Creek upstream 3.1 Note: Unit 4 map (Map 5) follows:

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(11) Unit 5. Upper Flint River and Pennahatchee, Little Pennahatchee, Whitewater creeks in Coweta, Crawford, Swift, Limestone, Turkey, Hogcrawl, Red Oak, Line, and Crisp, Dooly, Fayette, Macon,

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Meriwether, Peach, Pike, Spalding, Rattlesnake Branch (¥83.84 longitude, mi) to Little Creek (¥83.90 longitude, Sumter, Talbot, Taylor, Upson, and 31.82 latitude), Crisp and Worth 32.28 latitude), Dooly and Macon Worth counties, Georgia. This is a counties, Georgia (the creek is the counties, Georgia (the creek is the critical habitat unit for the shinyrayed county boundary); Limestone Creek county boundary); Red Oak Creek from pocketbook, Gulf moccasinshell, oval from Lake Blackshear, Crisp County, the Flint River upstream 21.7 km (13.5 pigtoe, and purple bankclimber. Georgia, upstream 8.8 km (5.5 mi) to mi) to Brittens Creek (¥84.68 longitude, ¥ (i) General Description: Unit 5 County Road 89 ( 83.88 longitude, 33.11 latitude), Meriwether County, encompasses a total stream length of 32.04 latitude), Dooly County, Georgia; Georgia; Line Creek from the Flint River 380.4 km (236.4 mi) and includes the Turkey Creek from the Flint River upstream 15.8 km (9.8 mi) to Flint River from the State Highway 27 upstream 21.7 km (13.5 mi) to Rogers Whitewater Creek (¥84.51 longitude, bridge (Vienna Road) (¥83.98 Branch (¥83.89 longitude, 32.20 33.28 latitude), Coweta and Fayette longitude, 32.06 latitude) in Dooly and latitude), in Dooly County, Georgia; Sumter counties, Georgia (the river is Pennahatchee Creek from Turkey Creek counties, Georgia (the creek is the the county boundary), upstream 247.4 upstream 4.8 km (3 mi) to Little county boundary); and Whitewater km (153.7 mi) through Macon, Peach, Pennahatchee Creek (¥83.89 longitude, Creek from Line Creek upstream 21.5 Taylor, Crawford, Talbot, Upson, Pike, 32.10 latitude), Dooly County, Georgia; km (13.4 mi) to Ginger Cake Creek ¥ Meriwether, and Coweta counties, to Little Pennahatchee Creek from ( 84.49 longitude, 33.42 latitude), Horton Creek (¥84.42 longitude, 33.29 Pennahatchee Creek upstream 5.8 km Fayette County, Georgia. latitude) in Fayette and Spalding (3.6 mi) to Rock Hill Creek (¥83.85 (ii) Note: Two maps of unit 5 (Map 6, counties, Georgia (the river is the county longitude, 32.13 latitude), Dooly northern part of unit 5; and Map 7, boundary); Swift Creek from Lake County, Georgia; Hogcrawl Creek from southern part of unit 5) follow: Blackshear upstream 11.3 km (7 mi) to the Flint River upstream 21.6 km (13.4

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(12) Unit 6. Middle Flint River and Little Muckalee, Mill, Mercer Mill Pond, Dougherty, Lee, Marion, Schley, Sumter, Kinchafoonee, Lanahassee, Muckalee, Abrams, Jones, and Chokee creeks; Terrell, Webster, and Worth counties,

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Georgia. This is a critical habitat unit for (¥84.58 longitude, 32.17 latitude), longitude, 31.67 latitude), Worth the shinyrayed pocketbook, Gulf Webster County, Georgia; Lanahassee County, Georgia; Mercer Millpond Creek moccasinshell, oval pigtoe, and purple Creek from Kinchafoonee Creek from Mill Creek upstream 0.45 km (0.28 bankclimber. upstream 9.3 km (5.8 mi) to West Fork mi) to Mercer Mill Pond (¥83.99 (i) General Description: Unit 6 Lanahassee Creek (¥84.50 longitude, longitude, 31.68 latitude), Worth encompasses a total stream length of 32.11 latitude), Webster County, County, Georgia; Abrams Creek from the 302.3 km (187.8 mi) and includes the Georgia; Muckalee Creek, from its Flint River upstream 15.9 km (9.9 mi) to Flint River from Piney Woods Creek confluence with Lake Worth at the Lee- County Road 123 (¥83.93 longitude, (¥84.06 longitude, 31.61 latitude) in Dougherty county line (¥84.14 31.68 latitude), Worth County, Georgia; Dougherty County, Georgia (the longitude, 31.62 latitude), upstream Jones Creek from the Flint River upstream extent of Lake Worth), 104.5 km (64.9 mi) to County Road 114 upstream 3.8 km (2.4 mi) to County upstream 39.9 km (24.8 mi) to the (¥84.44 longitude, 32.23 latitude), Road 123 (¥83.96 longitude, 31.76 Warwick Dam (¥83.94 longitude, 31.85 Marion County, Georgia; Little latitude), Worth County, Georgia; and latitude), Lee and Worth counties, Muckalee Creek, from Muckalee Creek Chokee Creek, from the Flint River Georgia; Kinchafoonee Creek from its in Sumter County, Georgia, upstream upstream 10.5 km (6.5 mi) to Dry confluence with Lake Worth at the Lee- 7.2 km (4.5 mi) to Galey Creek (¥84.29 Branch Creek (¥84.02 longitude, 31.89 Dougherty county line (¥84.17 longitude, 32.17 latitude), Schley latitude), Lee County, Georgia. longitude, 31.62 latitude), upstream County, Georgia; Mill Creek from the (ii) Note: Two maps of unit 6 (Map 8, 107.6 km (66.8 mi) through Terrell and Flint River upstream 3.2 km (2 mi) to western part of unit 6; and Map 9, Sumter Counties, Georgia, to Dry Creek Mercer Millpond Creek (¥83.99 eastern part of unit 6) follow:

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(13) Unit 7. Lower Flint River and Ichawaynochaway, Mill, Pachitla, Little Cooleewahee creeks in Baker, Calhoun, Spring, Aycocks, Dry, Pachitla, Chickasawhatchee, and Decatur, Dougherty, Early, Miller,

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Mitchell, and Terrell counties, Georgia. km (46.1 mi) to County Road 35 18.9 km (11.8 mi) to Little Pachitla This is a critical habitat unit for the (¥84.78 longitude, 31.34 latitude), Early Creek (¥84.68 longitude, 31.56 shinyrayed pocketbook, Gulf County, Georgia; Aycocks Creek from latitude), Calhoun County, Georgia; moccasinshell, oval pigtoe, and purple Spring Creek upstream 15.9 km (9.9 mi) Little Pachitla Creek from Pachitla Creek bankclimber. to Cypress Creek (¥84.79 longitude, upstream 5.8 km (3.6 mi) to Bear Branch (i) General Description: Unit 7 31.15 latitude), Miller County, Georgia; (¥84.72 longitude, 31.58 latitude), encompasses a total stream length of Dry Creek from Spring Creek upstream Calhoun County, Georgia; 396.7 km (246.5 mi) and includes the 9.9 km (6.1 mi) to Wamble Creek Chickasawhatchee Creek from Flint River from its confluence with Big (¥84.84 longitude, 31.31 latitude), Early ¥ Ichawaynochaway Creek, Baker County, Slough ( 84.56 longitude, 30.93 County, Georgia; Ichawaynochaway Georgia, upstream 64.5 km (40.1 mi) to latitude), Decatur County, Georgia, Creek from the Flint River, Baker U.S. Highway 82 (¥84.38 longitude, upstream 116.4 km (72.3 mi) through County, Georgia, upstream 68.6 km 31.74 latitude), Terrell County, Georgia; Baker and Mitchell Counties, Georgia, to (42.6 mi) to Merrett Creek (¥84.58 and Cooleewahee Creek from the Flint the Flint River Dam (which impounds longitude, 31.54 latitude), Calhoun ¥ River upstream 15.1 km (9.4 mi) to Lake Worth) ( 84.14 longitude, 31.60 County, Georgia; Mill Creek from ¥ latitude), Dougherty County, Georgia; Ichawaynochaway Creek upstream 7.4 Piney Woods Branch ( 84.31 longitude, Spring Creek, from its confluence with km (4.6 mi) to County Road 163 31.42 latitude), Baker County, Georgia. Lake Seminole at Smith Landing (¥84.63 longitude, 31.40 latitude), (ii) Note: Two maps of unit 7 (Map 10, (¥84.75 longitude, 30.89 latitude), Baker County, Georgia; Pachitla Creek, western part of unit 7; and Map 11, Decatur County, Georgia, upstream 74.2 from Ichawaynochaway Creek upstream eastern part of unit 7) follow:

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(14) Unit 8. Apalachicola River and Calhoun, Franklin, Gadsden, Gulf, This is a critical habitat unit for the fat the Chipola Cutoff and Swift Slough in Jackson, and Liberty counties, Florida. threeridge and purple bankclimber.

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(i) General Description: Unit 8 Charts) (¥85.01 longitude, 29.88 its confluence with the Chipola River, includes the main stem of the latitude), Franklin County, Florida, Gulf County, Florida; Swift Slough from Apalachicola River and two of its through Calhoun and Liberty Counties, the Apalachicola River, Liberty County, distributaries, Chipola Cutoff and Swift Florida, upstream to the Jim Woodruff Florida, downstream 3.6 km (2.2 mi) to Slough, encompassing a total stream Lock and Dam (which impounds Lake its confluence with the River Styx ¥ length of 155.4 km (96.6 mi). The main Seminole) ( 84.86 longitude, 30.71 (¥85.12 longitude, 30.10 latitude), stem of the Apalachicola River extends latitude), Gadsden and Jackson counties, Liberty County, Florida. from the downstream end of Bloody Florida; Chipola Cutoff from the Bluff Island (river mile 15.3 on U.S. Apalachicola River in Gulf County, (ii) Note: Unit 8 map (Map 12) Army Corps of Engineers Navigation Florida, downstream 4.5 km (2.8 mi) to follows:

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(15) Unit 9. Upper Ochlockonee River 177.3 km (110.2 mi). The main stem of longitude, 30.98 latitude), Grady and and Barnetts and West Barnetts creeks, the Ochlockonee River extends from its Thomas counties, Georgia; West and the Little Ochlockonee River in confluence with Gulley Branch (the Barnetts Creek from Barnetts Creek Gadsden and Leon counties, Florida, approximate upstream extent of Lake upstream 10 km (6.2 mi) to Georgia and Grady and Thomas counties, Talquin) (¥84.44 longitude, 30.46 Highway 111 (¥84.17 longitude, 30.98 Georgia. This is a critical habitat unit for latitude), Gadsden and Leon counties, latitude), Grady County, Georgia; and the shinyrayed pocketbook, Florida, upstream 134.0 km (83.3 mi) to the Little Ochlockonee River from the Ochlockonee moccasinshell, oval Bee Line Road/County Road 306 Ochlockonee River upstream 13.3 km pigtoe, and purple bankclimber. (¥83.94 longitude, 31.03 latitude), (8.3 mi) to Roup Road/County Road 33 (i) General Description: Unit 9 Thomas County, Georgia; Barnetts Creek (¥84.02 longitude, 31.02 latitude), includes the main stem of the Ochlockonee River upstream of Lake from the Ochlockonee River upstream Thomas County, Georgia. 20 km (12.4 mi) to Grady County Road (ii) Note: Unit 9 map (Map 13) Talquin and three tributaries ¥ encompassing a total stream length of 170/Thomas County Road 74 ( 84.12 follows:

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(16) Unit 10. Lower Ochlockonee counties, Florida. This is a critical (i) General Description: Unit 10 River in Leon, Liberty, and Wakulla habitat unit for the purple bankclimber. encompasses a total stream length of

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75.4 km (46.9 mi) and includes the main County, Florida, upstream 75.4 km (46.9 longitude, 30.39 latitude), Leon and stem of the Ochlockonee River from its mi) to the Jackson Bluff Dam (which Liberty counties, Florida. confluence with Syfrett Creek (¥84.56 impounds Lake Talquin) (¥84.65 (ii) Note: Unit 10 map (Map 14) longitude, 30.02 latitude), Wakulla follows:

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(17) Unit 11. Santa Fe River and New the river goes underground in O’Leno and the New River from its confluence River in Alachua, Bradford, Columbia, State Park (¥82.57 longitude, 29.91 with the Santa Fe River at the junction and Union counties, Florida. This is a latitude), Alachua and Columbia of Alachua, Bradford, and Union critical habitat unit for the oval pigtoe. counties, Florida, upstream 60.2 km counties, Florida, upstream 22.9 km (i) General Description: Unit 11 (37.4 mi) to the powerline crossing (14.2 mi) to McKinney Branch (¥82.27 includes the main stem of the Santa Fe located 1.9 km (1.2 mi) downstream longitude, 30.01 latitude) in Bradford River and its tributary the New River from the U.S. Highway 301 bridge and Union counties, Florida. encompassing a total stream length of ¥ ( 82.18 longitude, 29.84 latitude) in (ii) Note: Unit 11 map (Map 15) 83.1 km (51.6 mi). The main channel of Alachua and Bradford counties, Florida; the Santa Fe River extends from where follows:

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* * * * * Dated: May 30, 2006. Matt Hogan, Acting Assistant Secretary for Fish and Wildlife and Parks. [FR Doc. 06–5075 Filed 6–5–06; 8:45 am] BILLING CODE 4310–55–C

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Part IV

The President Proclamation 8026—National Child’s Day, 2006

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Federal Register Presidential Documents Vol. 71, No. 108

Tuesday, June 6, 2006

Title 3— Proclamation 8026 of June 1, 2006

The President National Child’s Day, 2006

By the President of the United States of America

A Proclamation A hopeful society ensures that its children are provided with the knowledge, skills, and opportunities to succeed. On National Child’s Day, we reaffirm our commitment to America’s children and recognize the power that each of us has to make a difference in a young person’s life. The character of a child is formed in the earliest years through the love and guidance of family members and other caring individuals. A parent, teacher, or mentor can help improve a child’s academic achievement, encour- age right choices, and help them to understand the importance of serving a cause greater than self. Through USA Freedom Corps, my Administration is providing opportunities for volunteers to work with children in schools, after-school programs, and through community groups and organizations. By volunteering, these adults set an example of service and good citizenship for our young people and provide youth with the stability and encouragement they need to achieve their dreams. My Administration has also launched the Community Guide to Helping America’s Youth at helpingamericasyouth.gov. This web-based tool is part of the Helping America’s Youth initiative, led by First Lady Laura Bush, and assists communities in identifying ways to lend a hand to children in need. In addition, my Administration is working through No Child Left Behind and the American Competitiveness Initiative to ensure every child has a quality education and the opportunity to succeed. By investing in the lives of our young people, we can help develop their personal character, teach them to be responsible citizens, and enable them to realize their full potential. NOW, THEREFORE, I, GEORGE W. BUSH, President of the United States of America, do hereby proclaim June 4, 2006, as National Child’s Day. I call upon citizens to observe this day with appropriate ceremonies and activities. I also urge all the people of the United States to take an active role in helping nurture the minds and character of our Nation’s children. IN WITNESS WHEREOF, I have hereunto set my hand this first day of June, in the year of our Lord two thousand six, and of the Independence of the United States of America the two hundred and thirtieth. W [FR Doc. 06–5199 Filed 6–5–06; 8:46 am] Billing code 3195–01–P

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published 5-15-06 Pesticides; tolerances in food, cotton loan deficiency Conservation Act; Title VIII [FR 06-04398] animal feeds, and raw payments (2006-2007 implementation (subsistence ENERGY DEPARTMENT agricultural commodities: crop years); published 6- priority): Energy Efficiency and Emamectin; comments due 6-06 Makhnati Island area; Renewable Energy Office by 6-12-06; published 4- ENVIRONMENTAL subsistence management Energy conservation: 12-06 [FR 06-03308] PROTECTION AGENCY jurisdiction; comments due Commercial and industrial FD&C Blue No. 1 PEG Pesticide programs: by 6-15-06; published 5-1- equipment, energy derivatives; comments due Biochemical and microbial 06 [FR 06-04012] efficiency program— by 6-12-06; published 4- pesticides; data AGRICULTURE Commercial heating, air 12-06 [FR 06-03307] requirements; published 3- DEPARTMENT conditioning, and water Pendimethalin; comments 8-06 Food Safety and Inspection heating equipment; due by 6-12-06; published HEALTH AND HUMAN Service efficiency certification, 4-12-06 [FR 06-03460] SERVICES DEPARTMENT Freedom of information and compliance, and FARM CREDIT Food and Drug public information: enforcement ADMINISTRATION requirements; comments Administration Meat or poultry product Farm credit system: due by 6-12-06; recalls; retail consignees; Animal drugs, feeds, and published 4-28-06 [FR Disclosure to stockholders— lists availability; comments related products: 06-03319] Financial disclosure and due by 6-11-06; published Oxytetracycline; implantation reporting requirements; 5-10-06 [FR 06-04394] ENERGY DEPARTMENT or injectable dosage form; comments due by 6-12- published 6-6-06 AGRICULTURE Federal Energy Regulatory 06; published 3-14-06 Commission TREASURY DEPARTMENT DEPARTMENT [FR 06-02382] Grain Inspection, Packers Public Utility Holding Company Internal Revenue Service Act of 2005; implementation: FEDERAL TRADE and Stockyards COMMISSION Income taxes: Administration Financial accounting, Trade regulation rules: Expatriated entities and their Grain inspection: reporting, and records foreign parents; Section retention requirements; Business opportunity rule; Rice; fees increase; 7874 guidance; published comments due by 6-15- fraud and unfair or comments due by 6-12- 6-6-06 06; published 5-16-06 [FR deceptive practices 06; published 4-11-06 [FR 06-04043] prevention; comments due 06-03507] by 6-16-06; published 4- ENVIRONMENTAL COMMENTS DUE NEXT AGRICULTURE 12-06 [FR 06-03395] PROTECTION AGENCY WEEK DEPARTMENT Air pollution control: GENERAL SERVICES Natural Resources ADMINISTRATION AGRICULTURE Conservation Service State operating permits programs—- Federal Management DEPARTMENT Conservation operations: Regulation: Missouri; comments due Agricultural Marketing Appeals procedures; Motor vehicle management; Service by 6-12-06; published comments due by 6-15- 5-12-06 [FR 06-04432] comments due by 6-12- National Organic Program: 06; published 5-16-06 [FR 06; published 5-12-06 [FR 06-04572] Missouri; comments due Livestock; pasture access; by 6-12-06; published 06-04430] comments due by 6-12- COMMERCE DEPARTMENT 5-12-06 [FR 06-04433] HEALTH AND HUMAN 06; published 4-13-06 [FR National Oceanic and SERVICES DEPARTMENT 06-03541] Air quality implementation Atmospheric Administration plans; approval and Centers for Medicare & Onions grown in Texas; Fishery conservation and promulgation; various Medicaid Services comments due by 6-15-06; management: States: Medicare: published 5-30-06 [FR E6- 08208] West Coast States and Arizona; comments due by Graduate medical education Western Pacific 6-15-06; published 5-16- affiliation provisions for AGRICULTURE fisheries— 06 [FR 06-04515] teaching hospitals in DEPARTMENT Pacific Coast groundfish; Air quality implementation emergency situations; Commodity Credit comments due by 6-16- plans; approval and comments due by 6-12- Corporation 06; published 6-1-06 promulgation; various 06; published 4-12-06 [FR Export programs: [FR 06-04987] States; air quality planning 06-03492]

VerDate Aug 31 2005 21:08 Jun 05, 2006 Jkt 208001 PO 00000 Frm 00003 Fmt 4712 Sfmt 4711 E:\FR\FM\06JNCU.LOC 06JNCU wwhite on PROD1PC61 with FRCU iv Federal Register / Vol. 71, No. 108 / Tuesday, June 6, 2006 / Reader Aids

Hospital inpatient JUSTICE DEPARTMENT Eurocopter France; Terrorism Risk Insurance prospective payment Executive Office for comments due by 6-12- Extension Act; systems and 2007 FY Immigration Review 06; published 4-13-06 [FR implementation; cross- rates; comments due by Immigration: 06-03535] reference; comments due 6-12-06; published 4-25- by 6-12-06; published 5- Arriving aliens in removal Fokker; comments due by 06 [FR 06-03629] 11-06 [FR 06-04349] proceedings; eligibility to 6-12-06; published 4-13- Hospital Inpatient apply for status 06 [FR 06-03480] Prospective Payment adjustment and jurisdiction General Electric Co.; Systems; 2007 FY to adjudicate applications comments due by 6-16- LIST OF PUBLIC LAWS occupational mix for status adjustment; 06; published 4-17-06 [FR adjustment to wage index. comments due by 6-12- E6-05645] This is a continuing list of implementation; comments 06; published 5-12-06 [FR Gulfstream; comments due public bills from the current due by 6-12-06; published 06-04429] by 6-12-06; published 4- 5-17-06 [FR 06-04608] 13-06 [FR 06-03540] session of Congress which NATIONAL ARCHIVES AND have become Federal laws. It HOMELAND SECURITY RECORDS ADMINISTRATION Honeywell; comments due DEPARTMENT may be used in conjunction Public availability and use: by 6-12-06; published 5- with ‘‘PLUS’’ (Public Laws Coast Guard 18-06 [FR E6-07559] Facility locations and hours; Update Service) on 202–741– Ports and waterways safety; comments due by 6-12- McDonnell Douglas; 6043. This list is also regulated navigation areas, 06; published 5-12-06 [FR comments due by 6-15- available online at http:// safety zones, security E6-07263] 06; published 5-1-06 [FR www.archives.gov/federal- zones, etc.: E6-06497] PERSONNEL MANAGEMENT register/laws.html. Atlantic Ocean; Ocean City, Turbomeca S.A.; comments OFFICE MD; comments due by 6- due by 6-16-06; published The text of laws is not Federal Long Term Care 12-06; published 5-11-06 4-17-06 [FR E6-05646] published in the Federal Insurance Program: [FR E6-07205] Class E airspace; comments Register but may be ordered East River, Mathews, VA; Miscellaneous changes, due by 6-12-06; published in ‘‘slip law’’ (individual comments due by 6-15- corrections, and 5-11-06 [FR 06-04362] pamphlet) form from the 06; published 5-18-06 [FR clarifications; comments Superintendent of Documents, due by 6-13-06; published TRANSPORTATION E6-07532] DEPARTMENT U.S. Government Printing 4-14-06 [FR 06-03585] Office, Washington, DC 20402 James River, Newport Federal Highway SMALL BUSINESS (phone, 202–512–1808). The News, VA; comments due Administration by 6-15-06; published 5- ADMINISTRATION text will also be made Engineering and traffic 18-06 [FR E6-07531] Small business size standards: available on the Internet from operations: GPO Access at http:// HOMELAND SECURITY Air traffic control, other Construction and DEPARTMENT airport operations, and www.gpoaccess.gov/plaws/ maintenance; culvert index.html. Some laws may Immigration: other air transportation pipes; alternative types not yet be available. Arriving aliens in removal support activities; specification; comments proceedings; eligibility to comments due by 6-16- due by 6-16-06; published S. 1736/P.L. 109–229 apply for status 06; published 5-17-06 [FR 4-17-06 [FR E6-05651] 06-04619] adjustment and jurisdiction TRANSPORTATION To provide for the participation to adjudicate applications TRANSPORTATION DEPARTMENT of employees in the judicial for status adjustment; DEPARTMENT branch in the Federal leave Federal Motor Carrier Safety comments due by 6-12- transfer program for disasters Federal Aviation Administration 06; published 5-12-06 [FR Administration and emergencies. (May 31, Motor carrier safety standards: 06-04429] Airworthiness directives: 2006; 120 Stat. 390) Driver qualifications; insulin- INTERIOR DEPARTMENT Airbus; comments due by 6- treated diabetes mellitus Last List May 31, 2006 Fish and Wildlife Service 12-06; published 5-17-06 standard; comments due Alaska National Interest Lands [FR E6-07477] by 6-15-06; published 3- Conservation Act; Title VIII Boeing; comments due by 17-06 [FR 06-02417] implementation (subsistence 6-12-06; published 4-11- TREASURY DEPARTMENT Public Laws Electronic priority): 06 [FR 06-03437] Internal Revenue Service Notification Service Makhnati Island area; Brantly International, Inc.; (PENS) subsistence management comments due by 6-16- Income taxes: jurisdiction; comments due 06; published 4-17-06 [FR Consolidated group by 6-15-06; published 5-1- 06-03536] regulations— 06 [FR 06-04012] Foreign common parent; PENS is a free electronic mail Cirrus Design Corp.; notification service of newly Endangered and threatened agent; cross-reference; comments due by 6-15- enacted public laws. To species: comments due by 6-12- 06; published 5-2-06 [FR subscribe, go to http:// Critical habitat E6-06590] 06; published 3-14-06 [FR 06-02437] listserv.gsa.gov/archives/ designations— DG Flugzeugbau GmbH; publaws-l.html Suisun thistle and soft comments due by 6-12- TREASURY DEPARTMENT bird’s-beak; comments 06; published 5-16-06 [FR Terrorism Risk Insurance Note: This service is strictly due by 6-12-06; E6-07394] Program: for E-mail notification of new published 4-11-06 [FR Empresa Brasileira de Terrorism Risk Insurance laws. The text of laws is not 06-03343] Aeronautica S.A. Extension Act; available through this service. Polar bear; comments due (EMBRAER); comments implementation; comments PENS cannot respond to by 6-16-06; published 5- due by 6-16-06; published due by 6-12-06; published specific inquiries sent to this 17-06 [FR E6-07448] 5-17-06 [FR E6-07474] 5-11-06 [FR 06-04348] address.

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